Kirkcaldy Caf� Co., Ltd Petitioners [1921] ScotLR 419 (21 May 1921)

Kirkcaldy Caf� Co., Ltd Petitioners [1921] ScotLR 419 (21 May 1921)

The Court held that increasing the dividend cap from 4% to 6% constituted an 'improved means' of attaining the company's main purpose under section 9(1)(b) of the Companies (Consolidation) Act 1908, as it would enable the company to attract necessary capital without abandoning its philanthropic objects. The alteration was confirmed as it did not amount to a complete abandonment of the company's original purpose.

Citation
[1921] ScotLR 419
Parties
Petitioner: Kirkcaldy Café Company, Limited
Jurisdiction
Scotland
Judgment Date
21 May 1921
Procedural Posture
Petition for Confirmation of Alteration of Memorandum of Association / Judgment After Hearing and Further Resolution
Outcome
Petition granted in part; alteration confirmed
Legal Topics
Alteration of Memorandum of Association, Dividend Restriction, Philanthropic Company Objects, Companies (consolidation) Act 1908
Company Law Alteration of Memorandum of Association Dividend Restriction Philanthropic Company Objects Companies (consolidation) Act 1908

Case Brief

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Parties

Kirkcaldy Café Company, Limited

Petitioner

Procedural Posture

Petition for Confirmation of Alteration of Memorandum of Association / Judgment After Hearing and Further Resolution

Legal Issues

  1. 1 Whether the company may alter its memorandum to increase the maximum dividend from 4% to 6% under the Companies (Consolidation) Act 1908, section 9
  2. 2 Whether such alteration constitutes a restriction or abandonment of the company's philanthropic objects

Ratio Decidendi

The Court held that increasing the dividend cap from 4% to 6% constituted an 'improved means' of attaining the company's main purpose under section 9(1)(b) of the Companies (Consolidation) Act 1908, as it would enable the company to attract necessary capital without abandoning its philanthropic objects. The alteration was confirmed as it did not amount to a complete abandonment of the company's original purpose.

Court Disposition

Petition granted in part; alteration confirmed

Orders

  • The alteration of the memorandum of association to substitute 'six' for 'four' in the dividend clause is confirmed.