Dale v Martin

• Jurisdiction: Ireland
• Judgment Date: 28 June 1883
• Date: 28 June 1883
• Court: Chancery Division (Ireland)

Appeal.

Before LAW, C. MORRIS, C. J., and FITZ GIBBON, L. J.

DALE

and

MARTIN.

M'Dougall v. Jersey Imperial Hotal Co.ENR 2 H. & M. 528.

In re Exchange Banking Co. (Flitcroft's Case)ELR 21 Ch. D. 519.

Guinness v. Land Corporation of IrelandELR 22 Ch. D. 349.

Attree v. HaweELR 9 Ch. D. 337.

In re European Central Railway Co. (Sykes' Case)ELR L. R. 13 Eq. 255.

In re Wincham Shipbuilding, Boiler and Salt Co. (Poole, Jackson, and White's Case)ELR 9 Ch. D. 328.

Oakbank Oil Co. V. CruiseELR 8 App. Cas. 65.

In re Phoenix Bessemer Steel Co. 44 L. J. Ch. 683.

In re Ince Hall Rolling Mills Co., Limited 30 W. R. 945.

In re Dronfield Silkstone Coal Co.ELR 17 Ch, D. 76.

In re Baglan Hall Colliery Co.ELR L. R. 5 Ch. App. 346.

In re Wedgewood Coal and Iron co. (Anderson's Case)ELR 7 Ch. D. 75.

Simpson v. Westminister Palace Hotal Co.ENR 8 H. L. C. 712.

Dent v. London Tramways Co.ELR 16 Ch. D. 344.

The National Funds Assurance Co.ELR 10 Ch. D. 118.

Guinness v. The Land Corporation of IrelandELR 22 Ch. D. 349.

Company Articles of Association Sum paid on shares in advance of calls Contract to pay interest on such advance Interest payable out of capital as well as profits.

Tor.. 11.] CHANCERY DIVISION. 371 of the minor Plaintiff John Graham Wallace, the costs of this R. motion; and also the costs of and incident to such attachment, when 1883. taxed by the Taxing Master." WALLACE v. Solicitor for the Plaintiff :.lWr. W. Harper. hem. Solicitor for the Defendants Wasson and 1191inatry : Mr. W. E. Armstrong. DALE v. MARTIN (1). Appeal. 1883. Company-Articles of Association-Sum paid on shares in advance of cane-Contract to pay interest on such advance-Interest payable out of capital as well as profits. In the case of a Company, whose nominal capital is fixed, interest on money paid in advance of calls can be constituted a lawful debt, and made chargeable upon the assets of the Company as a debtor ; and a shareholder, who volunÂÂtarily advances money to a Company, is by law enabled to contract for interest upon his advance so long as it is not called up, such a contract binding the Company whenever it is honestly entered into. A Company was formed with a nominal capital of 150,000, divided into 15,000 shares of 10 each, of which 5 per share was, According to the Articles of Association, to be paid on allotment, and the balance at such time as the Directors should think fit. Article 22 authorised the Board to receive from any member, willing to advance it, all or any part of the money due upon the shares held by lqm beyond the sums called, and to pay interest on the money so paid. in advance at such rate as should be agreed on. All the capital was subscribed for, and 5 per share paid thereon. Five thousand. shares were allotted to M., and 5 per share duly paid by him on allotment. M. paid in advance the further sum of 5 on each of his five thousand shares, under an agreement with the Board that the sum so advanced should carry interest at 5 per cent. until the whole of the capital of the Company should be called up. No further call had been made on the shareholders, beyond. the 5 per share paid on allotment. No profit had been made by the Company in a certain year, and a year's interest was due upon the sum advanced. by M., to enforce payment of which interest an action was brought : Held (affirming the decision of Chatterton, V. C.), that M. was entitled. to recover from the Company the interest due as a debt payable out of the general (1) Before LAW, C., MORRIS, C. J., and Frrz GIBBON, L. J. LAW REPORTS (IRELAND). [L. t assets of the Company, including its available capital, and not merely out of profits. In re National Funds Assurance Company (10 Ch. Div. 118) and Guinness v. Land Corporation of Ireland (22 Ch. Div. 349) distinguished. APPEAL by the defendant Company from the judgment of Chatterton, V. C., of the 1st December, 1882, declaring the PlainÂÂtiffs entitled to recover out of the general assets of the Company, including .its available capital, the interest due on sums paid by their testator, the late John Martin, in advance of calls. The hearing below is reported, 9 L. R. Ir. 498, where the facts and arguments of counsel will be found fully set out. Mr. Jellett, Q. C., and Mr. P. White; Q. C. (with them Mr. Wm. Kenny), for the Appellants. Mr. Jackson, Q. C., and Mr. H. Fitz Gibbon, Q. C. (with them Mr. H. M. Fitz Gibbon), for the Respondents. The following authorities...