COPY.
From O. R. High Court to Comptroller.
7th August, 1937.
79
"Distribution of assets pari passu is a prominent
feature in the scheme of the Act (The Companies Act, 1929);
in sections which deal with administration of the assets no
construction which would lead to a distribution other than
pari passu has ever been entertained with favour".
11th Edition, page 499, last paragraph).
(Buckley
As unfortunately the principle enunciated in the above
quotation has already been departed from in the cases of
several Dominions and foreign countries, it is perhaps rather
late in the day to endeavour to 'stop the rot', but I think
it should be borne in mind that every approval of such
departure makes it more difficult for the Government to
arrange with foreign countries for equality of distribution.
In this connection it might be well to refer to the papers
containing a memorandum with regard to the practice of
different countries which is referred to in Minute 5 of File
2927 of 1928. I have not the file containing this Memorandum
before me.
The scheme of the new Section 275A in the attached Bill
has at least this virtue as compared with the South African
Ordinance which is to be found in the above mentioned file
(Cos. 2927 of 1928) in that the latter charges the assets of
the Company with the payment of local creditors, whereas the
former is permissive and merely gives the Court power to
make an Order that the assets of a Company situated within
the Colony shall be applied in the first instance to payment
of such debts as were contracted by the Company within the
Colony; so that the Court would be able to have regard to
the justice and equity of any particular case. The sort of
case I have in mind, in which in my opinion it would be
particularly unfair that local creditors should have the
No comments yet.
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