provided he was willing to accept payment in fully paid-up shares. Advertisements were accordingly inserted, and shares, purporting to be fully paid-up, were issued to W., but the contract was not registered as required by section 25 of the Companies Act, 1867. A bill was sent in by W. for the advertisements, and the words "paid in script" were written at the foot of the bill and signed by W.'s agent.

Held (reversing the decision of Hall, V.-C.), that, the allottee having originally agreed to accept shares in payment of his account, the company never came under any liability to pay for the advertisements in cash; and therefore that the allottee must be placed on the list of contributories for unpaid shares. Fothergill's Case (L. R. 8 Ch. App. 270) followed; Spargo's Case (L. R. 8 Ch. App. 407; 28 L. T. (N. s.) 153) distinguished. In the latter case it was held that a bona fide debt in money payable by the company to the shareholders, at the time of the issue of the shares, would amount to payment in cash" within section 25 of the Companies Act, 1867.-Re Government, etc., Insurance Co., White's Case, 1879, Ct. of App. (James, Brett, and Cotton, L. JJ.), L. R. 12 Ch. Div. 511; 41 L. T. (N. s.) 333; 48 L. J., Ch., 236; 27 W. R. 304.

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7.-Damages, Right to by a Newspaper Proprietor who is promised Paid-up Shares in return for Advertisements.

In another case, also, advertisements were inserted on the terms of the newspaper proprietor, M., receiving certificates of fully paid-up shares to the amount of his charges.

The company was wound-up, and M. was settled on the list of contributories, and made liable for the full amount of the nominal value of

the shares, on the ground that nothing had been paid on them, and there had been no contract duly registered under the Companies Acts for the issue of the shares without liability. M. had no notice or knowledge that the shares were not issued under a registered contract. He made a claim to prove in the winding-up by way of damages for the par value of the shares in his name. It was contended that the company was not bound to register the contract before issuing the shares, and that contributory negligence was imputable to the applicant for not seeing that it was registered.

Hall, V.-C., was of opinion that the argument could not avail the company in the teeth of their express contract to give fully paid-up shares, i.e., effectually paid-up shares. The agreement had been broken. For the breach there was a right of action against the company, and therefore a right of proof in the windingup. In his opinion the measure of damages would be the value of the really paid-up shares at the date when the allotments were made.-Re Government, etc., Insurance Co., Mudford's Case, 1880, Hall, V.-C.; W. N., 1880, p. 90; 49 L. J., Ch., 452.

8.-Equitable Mortgage-Share Certificates-Cestui que Trust Trustee.

(i.)—Where shares are held in trust, it is to be observed that as far as the trustee, the cestui que trust, and the company are concerned, the trustee is treated by the Companies Acts as being for all purposes the owner of the shares. This, however, is not the case as between the trustee, the cestui que trust, and third parties.

(ii.)-A certificate of shares is merely a solemn affirmation under the seal of the company that a certain amount of stock stands in the name of

the individual mentioned in the certificate. It is the duty of a person, who receives the certificates as an equitable mortgagee of shares, to inquire what is the real position of a person pretending to mortgage them, for if such person has only the legal title by having the certificates in his possession, but is, in truth, merely the trustee for another, the equitable mortgagee will be unable to enforce his claim in opposition to the original cestui que trust.

On this point decision was given in the House of Lords in the case of Reg. v. Shropshire Union Railway Co., 1875; L. R. 7 H. L. Cas. 496, reversing S. C., L. R. 8 Q. B. 420.

(iii.)-Per Cairns, L. C.:-Whether a transfer of shares in a company can or cannot be made without the production of the certificates of the shares, is a matter entirely within the discretion of the directors.

9.-Shares" in his own Right"--Claim to act as a Director.

The words "in his own right" do not mean that a person must hold the shares beneficially.

In the case of Pender v. Lushington (L. R. 6 Ch. D. 70) Jessel, M. R., observed that, the register of shareholders was final for the purpose of voting, and that, as the Court was precluded by the Companies Act from regarding any trust attaching to the shares, all that the words "in his own right" meant was, that a person must hold the shares in his own right, and not in such a capacity as executor or administrator, or as the husband of a feme coverte, who might be a shareholder.

Scc, also, the later case of Pulbrook v. Richmond Mining Co.; L. R. 9 Ch. D. 610; 48 L. J., Ch., 65; 27 W. R. 377.

10.-Allotment of Shares-Letter of Allotment posted, but not received-Post Office, Agent of Parties contracting by Letter.

Where an offer or application for shares has been made to a person, who is expressly or by implication authorized to accept such offer by post, then, as soon as

a letter containing an acceptance is posted, correctly addressed to the applicant, the contract is complete, even though such letter never reaches the applicant.

The defendant applied for shares in the plaintiff's company. The company allotted the shares to the defendant, and duly addressed to him and posted a letter containing the notice of allotment, but the letter never was received by him :

Held (affirming the decision of Lopes, J.), that the defendant was a shareholder. British and American Telegraph Co. v. Colson (L. R. 6 Ex. 108) overruled.

Household Fire Insurance Co. v. Grant, 1879, Ct. of App. (Baggallay and Thesiger, L. JJ.,-Bramwell, L. J., dissenting); L. R. 4 Ex. Div. 216; 48 L. J., C. P., 577; 41 L. T. (N. s.) 298. (Sec, also, the leading case of Dunlop v. Higgins; L. R. 1 H. L. Cas. 381.)

11.-Buying up of shares.

(i.)-It is open to doubt whether a company can purchase its own shares, even if the memorandum of association in direct terms authorizes it. By buying up its shares a company would be reducing its capital and the security of its creditors. It would be a reduction of a kind quite different from that for which specific provisions of a special kind are made by the Statute of 1867.

(ii.)—Nor can such a power be acquired after incorporation by special resolution.

In 1876, the International Financial Society deter mined, by resolution of two meetings, to apply its funds to buy up its own shares at prices by tender. A member,

Hope, objected and threatened legal proceedings. The directors thereupon determined (under a clause in the articles) to expel him, as one disturbing the peace of the society, and to pay him the market price of his

shares.

Held, by Bacon, V.-C., that the scheme was ultra vires and void by reason of section 12 of the Companies Act, 1862, and that no clause in the articles could bar a member's right to apply to the Courts of law. Affirmed on appeal.-Hope v. International Financial Soc., 1876, L. R. 4 Ch. Div. 327; 35 L. T. (n. s.) 623; 46 L. J., Ch., 200; 25 W. R. 203.

12.-Purchase of Shares-Fraud of Directors-Rescission of Contract, not available after Company has stopped payment.

T. appeared on the register as a holder of shares in a joint stock banking company, which stopped payment. After the stoppage, and before the resolution to wind-up had been passed, T. raised an action for reduction of his contract to take shares, on the ground that he had been induced to purchase them by the fraudulent misrepresentation of the directors.

Held (affirming the decision of the Court below), that the contract could not be rescinded after the company had stopped payment, as the rights of innocent third parties had intervened; and that T.'s action for reduction of his contract was too late to exempt him from liability. -Tennent v. City of Glasgow Bank, 1879, H. of Lords; L. R. 4 App. Cas. 615; 40 L. T. (N. s.) 694; 27 W. R.