Scottish Insurance Corporation v Wilsons & Clyde Coal Co Ltd
Encyclopedia
Scottish Insurance Corp Ltd v Wilsons & Clyde Coal Co Ltd [1949] AC 462 is a UK company law case concerning share
s. It illustrates that where the rights of shares are explained in the articles, that is likely to be an exhaustive statement.
. The company’s assets were transferred to the National Coal Board
, and the company was waiting for reimbursement. In advance of liquidation the company procured a special resolution for reduction of capital, whereby all paid up capital would be returned to preference shareholders, to settle any claims. The aim was to eliminate them from the company, so ordinary shareholders could get excesses from compulsory purchase compensation. The preference shareholders, including Scottish Insurance Corp Ltd complained that they should be able to share in the proceeds from liquidated assets.
Share
Share may refer to:to some dume life* To share a resource is to make joint use of it; see sharing.* Share , a man who writes Urdu poetry* Share , a stock or other security such as a mutual fund...
s. It illustrates that where the rights of shares are explained in the articles, that is likely to be an exhaustive statement.
Facts
Wilsons & Clyde Coal Co Ltd was nationalised under the Coal Industry Nationalisation Act 1946Coal Industry Nationalisation Act 1946
The Coal Industry Nationalisation Act of 1946 is an Act of the Parliament of the United Kingdom. It received Royal Assent on 12 July 1946, and provided for the nationalization of the entire British coal industry. It established the National Coal Board which acted as the managing authority for coal...
. The company’s assets were transferred to the National Coal Board
National Coal Board
The National Coal Board was the statutory corporation created to run the nationalised coal mining industry in the United Kingdom. Set up under the Coal Industry Nationalisation Act 1946, it took over the mines on "vesting day", 1 January 1947...
, and the company was waiting for reimbursement. In advance of liquidation the company procured a special resolution for reduction of capital, whereby all paid up capital would be returned to preference shareholders, to settle any claims. The aim was to eliminate them from the company, so ordinary shareholders could get excesses from compulsory purchase compensation. The preference shareholders, including Scottish Insurance Corp Ltd complained that they should be able to share in the proceeds from liquidated assets.
Judgment
The House of Lords held that preference shareholders had no right to share in surplus assets, so it could not be said that the scheme was not fair and equitable. Lord Simonds said the followingSee also
- UK company law
- Wilsons and Clyde Coal Ltd v English [1938] AC 57