RAMANUJAN COLLEGE

KALKAJI, NEW DELHI

CORpORAtE LAWs AssIGNMENt

CAsE LAWs

Submitted by Submitted to
Name – Hemant Singh Dr. Vijay Lakshmi
Roll no. – 20212053
Course – B. Com (Hons.)
Section – B
Semester – II

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Brown v. British Abrasive Wheel Company
Ltd. (1919)

Before: Astbury J.

Representation
Micklem K.C. and Dighton Pollock for the plaintiff.
Upjohn K.C. and Henry Johnston for the defendants.
Solicitors:
Andrew, Wood, Purves AND Sutton, for R.A. Rotherham AND Co., Coventry;
Surr, Gribble AND Co., for Docker, Hosgood AND Co., Birmingham.

Company Law:
Companies (Consolidation) Act, 1908 (8 Edw. 7, c. 69), s. 13.

Facts of the Case:

The majority which held 98 per cent of the shares of the company, passed a
special resolution to alter the articles to include the provision, that upon
the request of holders of 9/10th of the issued shares, a shareholder shall be
bound to sell and transfer his share to the nominee of such holders, at a
fair value. This alteration was not held to be valid as it was made for the
benefit of the majority and not for the benefit of the company as a whole.

Judgment:
Astbury J held that the alteration was not for the benefit of the company as
a whole and could not be made.

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B. Anand Behari Lal v. Dinshaw and Co.
(Bankers) Limited (1942)

Facts of the Case:

An accountant of a company transferred some property of a company
in favor of Anand Behari. On an action brought by him for breach of
contract, the court held the transfer to be void. It was observed that the
power of transferring immovable property of the company could not be
considered within the apparent authority of an accountant. The plaintiff
could not have supposed, in absence of power of attorney, that the
accountant had authority to effect transfer of company’s property.

Expectations to Doctrine of Indoor Management:

Negligence: The doctrine of indoor management in no way rewards those
who behave negligently. Thus, where the circumstances surrounding the
case are suspicious enough to invite enquiry, and if the outsider had made
enquiries and the irregularity would have been revealed, then he is stopped
from relying on the doctrine.

Judgement:
The court held that the plaintiff ought to have obtained a copy of the Power
of Attorney to confirm the authority of the accountant. Hence, the transfer
was considered void.

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