Discussing UK law. Links: swarb.co.uk | law-index | Acts | Members Image galleries

Who "Owns" a Limited Company ?

Re: Who "Owns" a Limited Company ?

Postby dls » Thu Jan 09, 2014 10:42 pm

I doubt seperately it could hold/sustain Common Law rights accrued by trading (because it hasnt traded for many years) and infact even a registered trade mark could be challenged if not used .


Nowhere near as simple as that. Common law rights here are presumably rights in passing off. There is no reason to think that such rights simply disappear when a company stops trading. There are many many trading names which persist in real value despite them no longer being used.
David Swarbrick (Admin) dswarb@gmail.com - 0795 457 9992
User avatar
dls
Site Admin
 
Posts: 12514
Joined: Thu Nov 01, 2012 1:35 pm
Location: Brighouse, West Yorkshire

Re: Who "Owns" a Limited Company ?

Postby jantra » Fri Mar 07, 2014 11:00 am

iwanttoaskaquestion wrote:
dls wrote:The terms you are using are incorrect - so much that I cannot understand what you are getting at.

Shareholders do not generally make such decisions. What you describe are the actions of directors.


Sorry DLS let me explain. The directors of the company who allegedly hold the common law rights are NOT shareholders. The shareholders of the company are holding 99 and 1 shares respectively. It is contended by the majority shareholder (which is a Ltd company itself ) that it (the Ltd company shareholder) is holder of those common law rights because they ,quote "own the company". So the questions are could that majority shareholder company claim the common law rights and bring them over to itself simply by being the majority shareholder, or would it have to show some deed of transfer agreed by the directors or other minority shareholder agreeing to such transfer of common law rights ?



the IP is owned by the subsidiary which can own property in its own right. the holding company (99% of equity) can control the subsidiary through its choice of directors but in itself it does not own the IP. The holding company can own the IP if there is a transaction between the holding company and subsidiary.

shareholders do not manage companies, directors do. shareholders appoint directors to manage the company and further its goals. however once appointed the directors have the power to act without reference to the shareholders although any acts against the wishes of the shareholders can result in the removal of the director following an AGM or EGM by majority shareholder vote.
jantra
 
Posts: 469
Joined: Sun Nov 25, 2012 10:59 am

Re: Who "Owns" a Limited Company ?

Postby jantra » Fri Mar 07, 2014 11:03 am

landlordnightmare wrote:
atticus wrote:...... If certain shareholders wish to treat a company asset as their own,...


The point would be NO - that is not the way company law works- that would almost certainly likely to be illegal


of course it is in practice. I own my own company (ies), they own their own assets. I am a director of all companies and choose when and where to use the companies assets. I properly record the transactions and as such all is above board. The issue will arise if the director seeks to gain some sort of pecuniary advantage by using his position - such as clearing a company bank account in the face of pending insolvency....
jantra
 
Posts: 469
Joined: Sun Nov 25, 2012 10:59 am

Re: Who "Owns" a Limited Company ?

Postby jantra » Fri Mar 07, 2014 11:04 am

iwanttoaskaquestion wrote:
dls wrote:The shareholders do not have direct access to or control of the company's assets save through the directors.
Only the directors have the power to do this sort of thing.

A shareholder cannot as shareholder deal with company assets or sign a transfer of a company asset - he can only transfer his share.

These are directors acts - actions taken in the capacity of director or shadow-director in dealing with the company assets. They are not the actions of shareholders. That they may have both roles does not mean that any particular act is in both roles.
Somebody doing the things complained of is acting as a director - if necessary as a shadow director, with the attendant duties of good faith to the company.


Thanks for this. In which case the Opponent will need to show some kind of paperwork assigning the
alleged common law rights of the dormant company TO the Opponent company I guess.
Thanks


why isn't the subsidiary company challenging rather than the holding company? am I missing something here?
jantra
 
Posts: 469
Joined: Sun Nov 25, 2012 10:59 am

Re: Who "Owns" a Limited Company ?

Postby jantra » Fri Mar 07, 2014 11:06 am

iwanttoaskaquestion wrote:
landlordnightmare wrote:To the OP

Be careful of associating 'dormant company' with a company with no rights or assets. 'Dormant' normally means 'not trading', it might still own a lot of assets - including shares or trademarks.

A 'dormant company' (to the best of my knowledge as far as legal proceedings are concerned) retains all the same rights as an actively trading compnay.

A company that is 'struck off' however ceases to legally exist - it died. But again be careful there - unlike humans - a dead company can quite easily be 'brought back from death' to exist as though it had never died if it has not been through a formal liquidation process.


Yes am aware of that thanks, but although the dormant company could be the registered owner/proprietor of a trade mark I doubt seperately it could hold/sustain Common Law rights accrued by trading (because it hasnt traded for many years) and infact even a registered trade mark could be challenged if not used .In the current case the dormant company does NOT own a registered mark, it is only contended (contended by the other company) to have common law rights in the name ,and it is those the other company says belong to them and which we dispute.

Thanks


the majority of holding companies don't trade per se, they tend to hold assets or investments and seek a return rather than generating their own income. forget about whether the company is dormant or trading as it doesn't mean they can't hold assets or IP, it just means they aren't using them. not only that but Companies House data is not current and can be significantly out of date. A company stated as dormant in the public record could be actually trading today!
jantra
 
Posts: 469
Joined: Sun Nov 25, 2012 10:59 am

Previous

Return to Company Law

Who is online

Users browsing this forum: No registered users and 1 guest

cron