Todd (Liquidator of Millen & Sommerville, Ltd) v. Millen and Others [1910] ScotLR 695 (16 June 1910)

Todd (Liquidator of Millen & Sommerville, Ltd) v. Millen and Others [1910] ScotLR 695 (16 June 1910)

The statement in the prospectus that the vendors 'have agreed to subscribe for' shares is not sufficient evidence of a concluded mutual contract binding the vendors to take, or the company to allot, the shares. There is no enforceable agreement, and thus the vendors cannot be placed on the list of contributories.

Citation
[1910] ScotLR 695
Parties
Petitioner: Alfred A. Todd (Liquidator of Millen & Sommerville, Limited); Respondents: Alexander Millen, Robert Galbraith Sommerville, and Alexander Melville (as trustees for James A. Millen & Sommerville)
Jurisdiction
Scotland
Judgment Date
16 June 1910
Procedural Posture
Company Winding Up / Appeal (reclaiming Note) From Lord Ordinary's Refusal to Rectify Register
Outcome
petition refused; appeal dismissed; Lord Ordinary's decision adhered to
Legal Topics
Contributories, Prospectus Liability, Share Subscription Agreements, Rectification of Register
Company Law Insolvency Law Contributories Prospectus Liability Share Subscription Agreements Rectification of Register

Case Brief

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Parties

Alfred A. Todd (Liquidator of Millen & Sommerville, Limited)

Petitioner

Alexander Millen, Robert Galbraith Sommerville, and Alexander Melville (as trustees for James A. Millen & Sommerville)

Respondents

Procedural Posture

Company Winding Up / Appeal (reclaiming Note) From Lord Ordinary's Refusal to Rectify Register

Legal Issues

  1. 1 Whether a statement in a prospectus that vendors 'have agreed to subscribe for' shares constitutes a binding contract to take shares, making them contributories on winding-up.
  2. 2 Whether the doctrine of personal bar applies to prevent the vendors from denying liability.

Ratio Decidendi

The statement in the prospectus that the vendors 'have agreed to subscribe for' shares is not sufficient evidence of a concluded mutual contract binding the vendors to take, or the company to allot, the shares. There is no enforceable agreement, and thus the vendors cannot be placed on the list of contributories.

Court Disposition

petition refused; appeal dismissed; Lord Ordinary's decision adhered to

Orders

  • Refusal to rectify the register of shareholders to include the respondents as holders of the disputed shares.