CO129-369 - Acting Governor May Governor Sir Lugard - 1910 [10-11] — Page 521

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COPY.

Enclosure

3

1904

Dear Sir Frederick,

EC

251

H. B. M. Supreme Court,

Shanghai, 8th. November,1910.

519

I hear that the Chief Justice's judgment

as to the registration of Companies in Hongkong is likely to delay the second reading of your Companies Ordinance. His judg» «ment seems to go beyond the question before him, and in the statement as to what law is applicable in Chine, he is likely to find this Court unanimously in disagreement with him. He

and says the Home Companies Act is not in force in Shanghai, this, although he had before him a judgment of Bourne's with which I am in general agreement to the contrary. As his opinion has no force in China it is immaterial, but I do not want you to have the impression that we have no machinery for winding up

a Hongkong Company here in respect of its assets which are situated within the jurisdiction of the Supreme Court for china and Corea. The parties in the case in which Sir Francia gave judgment would have been better advised if they had applied to

this Court first.

The material point is that if Hongkong choses to register thege Companies they would not escape the jurisdiction of the Courts in other Countries where they may

carry on business.

How far the penalies of the Home Act would apply to directors and others or to the Company itself is a difficult question on which I cannot give an opinien, but it is I think clear that a penalty could not be enforced by a British Court in China on the authority of a Hongkong Ordinance.

It is of vital importance to Shanghai that some provision for erecting limited liability Companies should exist and Hongkong Company law offers the easiest method. I am therefore writing this to assure you of my co-operation if you think Orders in council or action by the Foreign Office ar