PAGE 2-HONGKONG DAILY PRESS,
4
SATURDAY, JANUARY 16, 1940.
held by the claimants enemy country.”
Jaimants in
ST
The Chinese courts however were
with Its incorporation in China. It has not been -suggested, -nor-is-it arguable, that the company is in- or otherwise than by the law of corporated elsewhere than in China-
China,
But, as Palmer says in his Com-
I cannot therefore sea how it can [shareholders, and in such circum- The special court ordered the be contended that the company. Į stances the Court of Appeal held | dissolution of the company and the corporate juristic existence of that the wishes of the majority, from that decision the appellants which has ceased, should be deem- | the safety of the assets and the fri' this case appealed to the dealing, not with the property of ed to be still in being merely be- ability of the company to resume Supreme Court of Chins, which the company in Shan Tung, but cause it is still carrying on its ac-business at any time were decisive rejected 'the' appeal. tivities in North China. If I un-reasons against allowing it to be
ENEMY CHARACTER „derstand him aright, Mr. Sheldon wound up.
It is here contended that the submits that those activities, apon- Here, although the appellants Chinese courts had no jurisdiction sored as they must be by the Jap-hold many more khares than de because, it is said, the administra- anese, have converted the com-the respondents, the business of tion of Shan Tung by the Chinese pany into ari allen enemy of the branch cannot possibly be car-has been replaced by the military pany Law, 18th edition, at page 45- China, with the affairs of which ried on except to the jeopardy of jurisdiction of the invaders, the this Court cannot interfere, What-the assets, or else under the 'con-allegiance which the company-for- ever force there might be in this trol of Japanese agents whose ap-merly owed to China has been dis- contention if the company were pointment as such was not only placed in favour of an Allegianceership or a family, a mere col- still Incorporated for all purposes void but illegal under the law of to Japan, and the company has under the laws of China, it seems |Ch'¬u.
j
now acquired an enemy character to me that its winding-up as a Por these reasons and for the which would remove it from the corporation pas automatically de-reasons given in the judgment of jurisdiction of the Chidese courts prived it or any such status. It the Court below I am satisfied even if in fact they were able to may well be that the persons res-that the winding up order herein enforce their judgment that the ponsible for its continued activi-was rightly made and that this ap-company be dissolved. ties under the aegis of Japanese peul should be dismissed with interests have broken the laws of costs. China `by, trading with eremy sub-
Despite that judgment. It is said, the company still has in fact a corporate existètice and is carrying
jects but it is the individuals and MR. JUSTICE FRASER on business in Chefoo, and there-
alive?
ENGLISH- LAW
Mr. Justice Fraser said:- I agree with the judgment which has just been delivered by the learned Pulsne Judge.
The Ching Kee Steam "Naviga-
fore there isʻrio ground on which the branch of the "combaby In Hongkong can be wound up under section 313 (1) (b) of the Compan- les Ordinarice, 1932 (No. 39)...
It is said by counsel for the ap-
not the corporation who are now carrying on business. The cor- poration itself is dead. Since then the parent trunk has for all practical purposes ceased to exist, how can this Court be reasonably asked to say that a branch is stillition Company, Limited. is a compellants that in the contemplation pany incorporated under the laws of a neutral (British) court the of the Republic of China. and hav-company is perfectly entitled to Ving its principal place of business trade with Japan, tytt In re Russian Bank for Foreign at Chefoo in the Province of Shan For some purposes; Indeed, it Trade (1933, 1 Ch. 745) and Lazard Tung: now occupied by the Japan- seems that the company has' ne- Brothers & Co. v. Midland Bank jege forces.
quired enemy character. Chefoods (1933 AC 289) are the clearest The company is carrying on in the actual possession of the possible authority for the propost-business In Chefoo, Dairen, An Japanese forces. The produce of tion that, once a foreign corpora- Tung. Tientsin.
Chwang, Cheloo and the property of the tion has been dissolved by an act Tsingtao and Shanghai, and its company in Chefoo would be re- of the foreign state which gave it ships fly the Chinese fag. But garded by the Chinese as enemy being, the corporation will no that they do so is little more than property and so Hlable to seizure. longer be regarded by English law a fiction. The ships enjoy only a The nationality of the occupied as still existent, and, as Maugham limited freedom. Their movements territory of Shan Tung as regards J. (as he then was) said in his are controlled by Japanese agents. property is no doubt Japanese.
With that state of affairs the judgment (p. 764) in the former case, the branch of such a cor-majority of the shareholders, who poration is nothing but "a sub-are the appellants in this case, merged wreck floating on the appear to concur. But there are analogous to that to which Lord ocean of "commerce."
Afteen hundred of them, the res-Lindley. in Janson v. Driefontein
New
"ANALOGOUS POSITION The position of the company is
-יו
"When war broke out the com- pany became an allen enemy ̋of this country .. (although"almost all its shareholders were residenti elsewhere and subjects of other countries."
It is true that in each of those pondents in this case, who do not Consolidated Mines, Limited, (1902). concur with the action of the ma-A.C., at page 505, was referring cases the Russian corporation con-jority, who wish
to dissociate when he said— cerned had been swept out of exis-themselves from it and the other tence and was completely thani-shareholders, and who to that end mate, whereas here some of the nave petitioned in the Chinese activities of the Company are ad-courts for the dissolution of the mittedly still being carried on in cómpany: All the shareholders North China, but the fact still re- mains that the existence of the Company as a Juristic person has been destroyed by the order of the Chungking District Court and with its destruction the Hongkong Branch, which must depend for its legal being on the continued exis tence of the company, cannot be deemed to be still alive.
KISK OF SEIZURE
have submitted themselves to the Chinese courts, which have ordered the dissolution of the company,
CHINESE JURISDICTION The jurisdiction of inferior courts in China is derived from section 2 of Article II of the Chinese Civil Code-
"Regarding the proceedings against a private juristic person or other corporate bodies cap-] able of being made pårtles in a j Even were it possible" to regard
sult, the court of the "dlätrict the branch as able to carry on-a
where its pri sipal office or prin- separate existence, it is obvious
cipal place of business is shall be that such existence could only be
of competent jurisdiction." maintained either by exposing the
But the court, to which applica- company's ships to the risk of al-tion would ordinarily have been most certain seizure by an enemy made, namely the Chefoo District power or by permitting the affairs. Court, was prevented from exercis- of the branch to be managed by ating its functions by the military élemy corporation. It is this occupation of Chefoo by the Jap "feature, apart from the fact that anese. A special court of first "e are here dealing with a branch instähce was appointed by an or "and not with the parent corpora der of the Supreme Court of China, tion itself, "that "makes the case | under Article XXIII of the Chinese clearly distinguishable from In re | Revised Code of Civil Procedure. *Middlesborough '"'Assembly "Rooms | by which--- `relled bon by the appellants. There Company (14 Ch. D, 104) which ́is "relled on by the oppellants. There the company had suspended its -activities for a considerable period Fin the "hope" of the return of bet-
the court directly higher than the court' whose fürisdiction is in question shall appoint, on the application of a party to the proceedings, a court of compet "ent jurisdiction.; when a court
fer times and a disgruntled share-off competent jurisdiction is, by bolder petitioned for its winking-⠀ressons of lawṣor-fact, prevented up which was opposed by a code. siderable majority ... of the other
from exercising its power of con- ducting a hearing."
Commenting on this statement] in Porter v. Freudenberg, (1915) 1 KB., 857, at page: 868, Lord Read- ing, C.J., "said→→
A corporation, it must be re- membered, is not, like a part-
lection or aggregation of' indiv!- dual units. It is, in contempla- tion of law, a person. distinct from the thembers or sharehold- ers who are interested in it--2 metaphysical entitya conveni- ent fiction of law,' but with no' physical existence. As Lord Sel-. borne sald (G. E. Bali, Co. v. "Turner, 8° Ch. App. 132): "The company-is-a mère abatraction of law."
And Ditey," "Ith edition, at page 136. 8a73-
The domicil of a corporation is the place considered by law to be the centre of its affairs which, -(1)-In the case of a trading corporation is Its princi- pal place of business, Le. the place where the administrative business of the corporation is carried on..
W
and in paragraph (4) of his com- ment on this rule-
"FURTHER DIFFERENCE
"There is this further essen-
- tial difference between the "do" micil of a natural person and the domicil of a corporation. The domicil of a human being is a fact which, on certain points, subjects him to the law of a particular country. The dometi of a corporation is action suggested by the "Tact that "a corpórátion is, on certain points, e... the Jurisdiction of the Counts, subject to the law of a particular country. " ̈ ̈ Hence ́& corporation may very well be ́considered ˆ domiciled, or rësi- dent, in a country for one pur- ́pose" and "tot 'for another, and hence, too, the great uncertainty as to the facts which determine the domicil, or residence, -of÷a corporation. In each case the particular question is "not whe- ther a corporation has in reality a permanent residence in a par-"
·ticular - country, but whether, for certain purposes (eg, submission to the jurisdiction of the Courts, or the situs of its shares, or lla- bility to taxation), a corporation. is to be considered 'ds résident in - England, or in some other coun try."
"Lord-Lindley's statement was not intended to be, and is not, exhaustive. His Lordship. for the purposes of the appeal then before the House of Lords, was considering - the 'character of a trading corporation and did not purport to deal with persons re siding but not carrying On 4 business in the enemy territory, "Such a person is equally treated It seems therefore that for some as an allen enemy, provided he purposes the domicile of this com- is voluntarily resident there. pany may be in enemy territory, having elected to live under the that is, the occupied Province of protection of the enemy state, Shan Tung, but for the purposes For the purpose of determining of its incorporation its domielle re- civil rights, a British subject, or mains in the country of its incor- the subject of a neutral state,poration, at least so long as Chin- who is voluntarily resident or ese law is the ordinary civil law of who is carrying on business in the Province of Shan Tung. hostile territory is to be regard That, at least, is the view, which ed, and treated, as ́anallen 'enemy has apparently been taken by the and is in the same position as a Chinese courts. It accords with subject of hostile nationality' re- the principle that a corporation sident in hostile territory."
PRODUCE OF LAND
And in The Asturian, (1816) P. per Bir Samuel Evans, on page 133, we and the statement.
"The simple fact upon which the decision of the court depends
can only be dissolved in the cou- try of its incorporation. -- Have the departure from or modification of appellants shown any ground for this principle in the present.case?
· STRONGEST VIEW The strongest view put forward
la that the goods claimed “Were in support of the argument mat the produce of land owned or Chinese Jurisdiction is suspended