SUPREME COURT

Evening Post, Volume LXXXV, Issue 51, 1 March 1913, Page 6

SUPREME COURT

ISSUE OF PREFERENCE SHARES. His Honour Mr. Justice Sim delivered judgment to-day in a friendly action under the Companies Act, 1908. between Turnbull and Jones, Ltd. (plaintiffs) and Alexander H. Turnbull, nominal defendant. His Honour said that the question submitted for determination by the originating summons was whether the plaintiff company was entitled, with or without alteration of its articles of association, or otherwise, and without increasing its capital, to issue all or any of its un--issued shares as Valid preference shares. Neither the memorandum of association nor the articles of association contained any provision for issuing any of the shares of the original capital as preference 1 shares. ' The memorandum of association (clause 6) provided, however, that the capital might be' increased by special resolution, and that any new shares forming the increased " capital of the company might be issued with a right of preference in certain specified iespects.' It was clear, in the» first place, that without .an alteration of its memorandum or articles of association, the company was not entitled to issue any of the unallotted shares of its present capital as preference shares. The question was whethe* it could acquire the power to do so by an alteration of its articles of association. It seemed to His Honour that under a decision of the Court of Appeal there was authority for saying that in the present case power to issue preference snares might be acquired by an alteration of the articles of association, if it was not inconsistent with the memorandum of association. In his opinion, there wa& nothing in the memorandum inconsistent with the existence of such a power. He, therefore, thought that the company, by an appropriate alteration of its articles of association could Obtain authority to issue all or any of the unissued shares in its present capital as preference shares. t Mf. A. W. Blair appeared for plaintiff company, and Mr. M. Myers for defendant, A WILL CASE. Judgment was also delivered in the action between Charles Thomas Rushbrook, Civil servant, Wellington (plaintiff), and Alfred Edward Pearman, of WeUsford. farmer (defendant). His Honour 1 Mr.i Justice Sim said tfae first question submitted by the originating summons was whether the plaintiff was the eldest son of the testator, Charles Rdshbrook. The only evidence before the Court was to the effect that ; the plaintiff was the eldest" son ; and the first question was, therefore, answered in the affirmative. After quoting the devise, his Honour said that the Real Estate Descent Act, 1874, was in force when the testator died ; and the first question to be considered was whether that Act applied to this case. In his opinion, it did not apply. The testator left his estate at Port Albert to his widow during her widowhood, and after her death or second marriage to his lawful heir. Under such a, devise, the heir, by force of Statute 3 and 4, William IV., c. 106, section 3, would succeed to the land by virtue of the devise, and not by virtu© of the descent. His Honour was of option that the devise to the testator's lawful heir must be construed as having the same effect in the year 1876 as it would have had if the testator had died in 1872, and that it operated as a gift to his common law heir. The result was that the fee simple of the land was now vested in plaintiff. Mr. E. F. Hadfield appeared for plaintiff, and Mr. R. C. Kirk for the defendant.