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Shareholders in Ltd company

Re: Shareholders in Ltd company

Postby inshallah » Tue Aug 01, 2017 7:36 pm

theycantdothat wrote:
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).


Well in this specific case (2 companies actually) it is not simply a CORRECTION of a personal name which could easily be seen as an error, but this shareholder is the name , for example "The Unincorporated Association" . So what exactly do they correct in that name to make it right ?. They cannot put "The Unincorporated Association LTD" as the shareholder as that doesn't exist anyway, it is not a simple slip/error. IF they had simply forgotten to put "Ltd" at the end or some other simple slip, fine I can understand the ease of correction, BUT in this case we are speaking of a Shareholder that doesn't exist in the way that allows it to be shareholder. What if the association has 276 members. WHO can simply replace the shareholder and say all is well and dandy ?. Maybe the replacement would be a person with zero money, How would the banks holding charges feel then ?. AND the UA doesn't want to lose control of the company but it clearly has by mistakenly thinking that they could be a Shareholder in their name .
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Re: Shareholders in Ltd company

Postby Smouldering Stoat » Tue Aug 01, 2017 8:31 pm

That question has already been answered: the trustees of the organisation would be substituted. Arguably, an entry in the company's register saying "The Camberwick Green and District Trainspotters Society" is merely shorthand for "The Management Committee of the Camberwick Green and District Trainspotters Society, as Trustees for that Society." It is not uncommon for unincorporated associations to establish a limited company to do some of the things which they have difficulty in doing for themselves.
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Re: Shareholders in Ltd company

Postby Smouldering Stoat » Tue Aug 01, 2017 9:37 pm

theycantdothat wrote:
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.


Up to a point, yes. But there are also plenty of examples of unincorporated associations bringing proceedings in their own names, or even suing each other.

We maintain the polite fiction that unincorporated associations cannot do all these things, but out in the wild they are doing them all the time. Clearly, as a matter of academic law they are acting through their trustees or members, and that their property is held in some form of trust, but for all practical purposes they are actually acting for themselves.
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Re: Shareholders in Ltd company

Postby dls » Wed Aug 02, 2017 6:50 am

We maintain the polite fiction that unincorporated associations cannot do all these things, but out in the wild they are doing them all the time. Clearly, as a matter of academic law they are acting through their trustees or members, and that their property is held in some form of trust, but for all practical purposes they are actually acting for themselves.


Agreed - which is exactly why the OP is barking up an empty tree.
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Re: Shareholders in Ltd company

Postby inshallah » Wed Aug 02, 2017 8:56 am

dls wrote:
We maintain the polite fiction that unincorporated associations cannot do all these things, but out in the wild they are doing them all the time. Clearly, as a matter of academic law they are acting through their trustees or members, and that their property is held in some form of trust, but for all practical purposes they are actually acting for themselves.


Agreed - which is exactly why the OP is barking up an empty tree.


Nope I can still see something very high up in the tree, well I think I can . Maybe I should go to erm "Specsavers(tm)" ?. Seriously though, it is now in hands of Companies House so we shall see. I will post the results on here.
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Re: Shareholders in Ltd company

Postby inshallah » Wed Aug 02, 2017 12:06 pm

The other thing that someone has pointed out to me is that any of the UA's main people who clearly have control over the company
should have been registered as PSC's .
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Re: Shareholders in Ltd company

Postby theycantdothat » Wed Aug 02, 2017 3:11 pm

inshallah wrote:
theycantdothat wrote:
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).


Well in this specific case (2 companies actually) it is not simply a CORRECTION of a personal name which could easily be seen as an error, but this shareholder is the name , for example "The Unincorporated Association" . So what exactly do they correct in that name to make it right ?. They cannot put "The Unincorporated Association LTD" as the shareholder as that doesn't exist anyway, it is not a simple slip/error. IF they had simply forgotten to put "Ltd" at the end or some other simple slip, fine I can understand the ease of correction, BUT in this case we are speaking of a Shareholder that doesn't exist in the way that allows it to be shareholder. What if the association has 276 members. WHO can simply replace the shareholder and say all is well and dandy ?. Maybe the replacement would be a person with zero money, How would the banks holding charges feel then ?. AND the UA doesn't want to lose control of the company but it clearly has by mistakenly thinking that they could be a Shareholder in their name .


Saying that an unicorporated association has no separate identity from its members is not the same thing as saying it does not exist. It is not the case that the shareholder does not exist. The point is that a shareholder needs to be identifiable, i.e. a physical person or an incorporated body. Who should be named as the shareholder is a separate question.

I am not clear that the matter needed to be referred to Companies House. Whose idea was it to do that?
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Re: Shareholders in Ltd company

Postby inshallah » Wed Aug 02, 2017 5:47 pm

theycantdothat wrote:
inshallah wrote:
theycantdothat wrote:
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).


Well in this specific case (2 companies actually) it is not simply a CORRECTION of a personal name which could easily be seen as an error, but this shareholder is the name , for example "The Unincorporated Association" . So what exactly do they correct in that name to make it right ?. They cannot put "The Unincorporated Association LTD" as the shareholder as that doesn't exist anyway, it is not a simple slip/error. IF they had simply forgotten to put "Ltd" at the end or some other simple slip, fine I can understand the ease of correction, BUT in this case we are speaking of a Shareholder that doesn't exist in the way that allows it to be shareholder. What if the association has 276 members. WHO can simply replace the shareholder and say all is well and dandy ?. Maybe the replacement would be a person with zero money, How would the banks holding charges feel then ?. AND the UA doesn't want to lose control of the company but it clearly has by mistakenly thinking that they could be a Shareholder in their name .


Saying that an unicorporated association has no separate identity from its members is not the same thing as saying it does not exist. It is not the case that the shareholder does not exist. The point is that a shareholder needs to be identifiable, i.e. a physical person or an incorporated body. Who should be named as the shareholder is a separate question.

I am not clear that the matter needed to be referred to Companies House. Whose idea was it to do that?


The Companies House advised me clearly that an Unincorporated Association cannot be a shareholder, and also that there were issues as regards
the PSC declaration. They (Companies House) suggested writing in so they could look in to it, which I did.
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Re: Shareholders in Ltd company

Postby Smouldering Stoat » Wed Aug 02, 2017 8:36 pm

The words "mountain" and "molehill" spring immediately to mind.

Unincorporated associations own all sorts of property. The manner by which that property is held in trust is well-established. When an unincorporated association brings court proceedings in its own name, it is quite clear what is happening. It is similarly clear if an unincorporated association is entered in the register as a member of a company. We may observe that the Companies Act prohibits notice of any trust being entered on a Company's register.

It is unclear to me by what power Companies House might act. There does not appear to be any such power under the Companies Act. The default provision is that they don't hold shareholder information at all: companies keep registers of their members and make them available for inspection as required by the Act. A company may elect to make that information available through Companies House, in which case they need not make the register available elsewhere, but may withdraw that election by giving notice. How and why is Companies House supposed to regulate those registers?

Power to order rectification of the register lies with the Court:
125Power of court to rectify register

(1)If—
(a)the name of any person is, without sufficient cause, entered in or omitted from a company's register of members, or
(b)default is made or unnecessary delay takes place in entering on the register the fact of any person having ceased to be a member,the person aggrieved, or any member of the company, or the company, may apply to the court for rectification of the register.


It does not appear that the Registrar, or anyone who is not a member of the company or the aggrieved person, may make an application for rectification.

As to Persons With Significant Control, it may be the case that one or more people directs the affairs of the unincorporated association exercises such control over it that he thereby has significant control over the Company. But it does not automatically follow. It would need to be shown that she did actually exercise that control.

All of which makes me wonder what your motivation is. What business is it of yours?
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Re: Shareholders in Ltd company

Postby inshallah » Wed Aug 02, 2017 9:33 pm

Smouldering Stoat wrote:
All of which makes me wonder what your motivation is. What business is it of yours?


Well when I tell you later the Company names you may see why but for now I will hold my tongue. It may be that nothing comes of it but if it does then I will post on this thread.
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