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

Shareholders in Ltd company

Re: Shareholders in Ltd company

Postby theycantdothat » Mon Jul 31, 2017 2:09 pm

I remember a leasehold title where the lease was granted to [name of unicorporated association] a trade union. The grant was of course void and a confirmatory lease had to be granted to trustees.

Unincorporated associations are something of an oddity and have traps for the unwary - see previous paragraph. One peculiarity is that if a club buys, say, a barrel of beer all the members buy it and any individual who buys a pint at the bar buys the beer again.
theycantdothat
 
Posts: 1118
Joined: Fri Nov 02, 2012 7:36 pm

Re: Shareholders in Ltd company

Postby inshallah » Mon Jul 31, 2017 6:50 pm

dls wrote:It is the compamy's own secretary who compiles and is responsible for the list of shareholders. Companies House merely receives a copy.


Well Companies House now have all the details and we shall see what they say. They did advise that Unincorporated Associations could NOT be shareholders but I wonder IF they will allow a correction. BUT even if they do it will make it difficult for the parties in question as this is a very well known "Association" and it will be hard to choose who should be shareholder. IF companies house do not allow a correction then that will mean the company may be struck off. I wonder what happens to all the loans etc that are tied to the Ltd companies in question ? Clearly those charges are worthless aren't they ?.
inshallah
 
Posts: 23
Joined: Sat Jul 29, 2017 9:12 pm

Re: Shareholders in Ltd company

Postby Hairyloon » Mon Jul 31, 2017 7:19 pm

dls wrote:It is the compamy's own secretary who compiles and is responsible for the list of shareholders. Companies House merely receives a copy.

Presumably then, they cop for any fallout consequent on the nonexistence of any recorded shareholders.
Take me to your lizard...
User avatar
Hairyloon
 
Posts: 9884
Joined: Thu Nov 01, 2012 3:12 pm
Location: From there to here and here to there... Funny things are everywhere.

Re: Shareholders in Ltd company

Postby inshallah » Mon Jul 31, 2017 7:57 pm

Let us assume that their are no valid shareholders in the 2 concerned companies. Those companies have a large number of properties and loans secured against the Company. CAN they be secured when there are no valid shareholders or are these banks and lenders on a limb now ?. AND who actually would own the freehold and leasehold properties, IF as thought now likely the sole shareholder is NOT allowed to be a shareholder ???
inshallah
 
Posts: 23
Joined: Sat Jul 29, 2017 9:12 pm

Re: Shareholders in Ltd company

Postby dls » Mon Jul 31, 2017 9:13 pm

Do not assume at all that this is not correctible fairly easily.
David Swarbrick (Admin) dswarb@gmail.com - 0795 457 9992
User avatar
dls
Site Admin
 
Posts: 12085
Joined: Thu Nov 01, 2012 1:35 pm
Location: Brighouse, West Yorkshire

Re: Shareholders in Ltd company

Postby inshallah » Mon Jul 31, 2017 9:19 pm

dls wrote:Do not assume at all that this is not correctible fairly easily.


Nope DLS I won't, I agree never assume is correct as you say. But please say HOW you think it COULD be
corrected ?. Can the directors say "Unincorporated Association ,sorry you cannot own the shares we
are giving them to XYZ" ?. HOW could the UA even transfer the shares since they were not allowed to
own them ?.
I just cannot see how it can be done, legally ?.
inshallah
 
Posts: 23
Joined: Sat Jul 29, 2017 9:12 pm

Re: Shareholders in Ltd company

Postby Smouldering Stoat » Mon Jul 31, 2017 10:29 pm

I am inclined to agree with Atticus. Brief perusal of Bailii reveals numerous examples of unincorporated associations suing or being sued in their own names which, lacking a separate legal identity, they are supposed not to be able to do. A search for the name of any major political party will reveal several such cases.

It may well be that, theoretically, the case is being brought against the members or governing bodies of those associations as trustees. If so, then listing the case as "A v The Labour Party" is a convenient and well-understood shorthand for "A v The National Executive Committee of the Labour Party as Trustees for the Members." Where, then, is the objection to similarly registering a shareholding? It would be most odd if the secretary of a small company ought to keep to a more strict approach than the High Court.

Even if this were not the case, plainly the Company has the power to clarify the entry in its register. It is not at all clear to me that it would be proper for Companies House to interfere in that.

There must be very many unincorporated associations who own shares, just as they own all sorts of other property.
Smouldering Stoat
 
Posts: 6280
Joined: Thu Nov 01, 2012 6:31 pm
Location: Near the Creek.

Re: Shareholders in Ltd company

Postby dls » Tue Aug 01, 2017 4:54 am

I just cannot see how it can be done, legally ?.


The trustees of the association would be substituted. Trusst of Land and Appointment of Trustees Act if necessary.
David Swarbrick (Admin) dswarb@gmail.com - 0795 457 9992
User avatar
dls
Site Admin
 
Posts: 12085
Joined: Thu Nov 01, 2012 1:35 pm
Location: Brighouse, West Yorkshire

Re: Shareholders in Ltd company

Postby theycantdothat » Tue Aug 01, 2017 4:08 pm

inshallah wrote:I just cannot see how it can be done, legally ?.


My opinion: I do not see why it has to be different from correcting any other mistake in describing a shareholder. If a shareholder's name is John Henry Smith and the company records show John Harold Smith, the secretary just makes the change in the records and issues a new share certificate to replace the old one. Companies House is informed of the change by the next annual return (or whatever they call it now).
theycantdothat
 
Posts: 1118
Joined: Fri Nov 02, 2012 7:36 pm

Re: Shareholders in Ltd company

Postby theycantdothat » Tue Aug 01, 2017 4:38 pm

Smouldering Stoat wrote:It may well be that, theoretically, the case is being brought against the members or governing bodies of those associations as trustees. If so, then listing the case as "A v The Labour Party" is a convenient and well-understood shorthand for "A v The National Executive Committee of the Labour Party as Trustees for the Members." Where, then, is the objection to similarly registering a shareholding? It would be most odd if the secretary of a small company ought to keep to a more strict approach than the High Court.


I think there is a difference.

If you do business with an unincorporated association and have a claim against it you need to be able to pursue it. You may not know the name of any official or indeed any member.

When it comes to ownership clarity is needed otherwise there is doubt about who can pass title. Members of an unincorporated association change over time. "The Dingle in the Dell Gardening Club" is as uncertain and vague as "the inhabitants of High Street Newton".
theycantdothat
 
Posts: 1118
Joined: Fri Nov 02, 2012 7:36 pm

PreviousNext

Return to Company Law

Who is online

Users browsing this forum: No registered users and 1 guest