WITH MODEL RULES, A PRACTICAL INTRODUCTION, AND A COPIOUS INDEX. BY ARTHUR SCRATCHLEY, M.A., Barrister-at-Law; Author of "The Practical Treatise on Building Societies ;” EDWARD WILLIAM BRABROOK, SECOND EDITION. LONDON SHAW & SONS, FETTER LANE & CRANE COURT, Law Printers and Publishers, NOTICE. PART I. of the present work is founded on the law as determined by 37 & 38 Vict. c. 42 (1874), for the carrying through of which beneficial Act Building Societies were indebted to the statesman-like efforts and support of the Right Hon. S. H. Walpole and Mr. W. M. Torrens, M.P., and to the unremitting exertions of Mr. J. Higham and the other members of the Building Societies Protection Committee. This Act has been amended, in matters of detail, since the first edition of this work was published, by the Building Societies Acts, 1875 and 1877. Part II. applies to societies certified under the Act of 1836, and not incorporated under that of 1874. Part III. relates to societies not registered under any Act. As it was passing through the press, the decision of the Court of Appeal in the case of the Padstow Total Loss and Collision Assurance Association (20 Ch. Div. 137) has been reported. It confirms the statements we have made in that Part, and establishes that a society of more than 20 members, formed for the acquisition of Gain by the society or by its members individually, is not even entitled to be wound up as an Unregistered company under sect. 199 of the Companies Act, 1862. We must venture to add that, so far as regards the particular society which was the subject of the decision, we have been wholly unable to follow the reasoning by which their Lordships arrived at the conclusion that it was one for the acquisition of gain, either by the society or by any of its members. The contract of marine insurance is one purely of Indemnity, and when it is entered into by a Mutual Society, it is an agreement that each member shall sustain a small loss in order that one may be relieved of a great loss. Suppose 21 persons, each to have a ship worth 2107., and 107. in the Bank. They agree that, when one of the 21 ships is lost, each will apply his 107. at the bank towards replacing the lost ship. When that has been done, each man has his ship as before, but each has lost his 107. in the bank. Where is the gain to any? One man has not lost so much as he would have lost if the association had never existed; but 20 men have lost what they would still have possessed. The society is really one for incurring loss by "the individual members thereof," except the one whose loss is mitigated. The metaphysical reasons by which their Lordships satisfied themselves that in his case 66 a diminution of a loss is a gain" would hardly have seemed so forcible to them if the question had been brought to the simple test of liability to Income tax. These considerations, however, are apart from the purpose of the present treatise as, with regard to Unregistered building societies, the effect of the decision is wholly satisfactory. LONDON, September, 1882. |