Scottish Court of Session Decisions

The Glasgow Coal Exchange Company on 20th January 1885 presented a petition to the Court of Session for the winding-up of the Glasgow Investments Company (Limited), and an order for judicial winding-up was pronounced by the Court on 6th February 1885. James Hutton, chartered accountant, Glasgow, was appointed official liquidator.

This was a note by the liquidator under the 115th section of the Companies Act 1862

Section 115 provides—“The Court may, after it has made an order for winding up the company, summon before it any officer of the company or … any person whom the Court may deem capable of giving information concerning the trade dealings, estate, or effects of the company, and the Court may require any such … officer or person to produce any books … or other documents in his custody or power belonging to the company…. Nevertheless in cases where any person claims any lien on papers, deeds, writings, or documents produced by him, such production shall be without prejudice to such lien, and the Court shall have jurisdiction in the winding-up to determine all questions relating to such lien.”

The liquidator averred that the only assets of the company consisted of 664 shares (£10 each, £5 paid up) in the Glasgow Coal Exchange Co. (Limited), and that these shares were transferred to the company by Messrs Borland & King, writers, Glasgow, in exchange for which they received fully paid-up shares of the company; that the capital of the company was £10,000 in 10,000 shares of £1 each; that up to July 10th 1884 3742 shares had been allotted and were paid up; that William Borland, writer, Glasgow, held 1868 shares, and John Young King, writer, Glasgow (his partner) held 1869 shares. The remaining allotted shares were held by the other parties named in the note, who held one share each.

The liquidator further averred that for the proper discharge of his duties it was necessary that he should obtain delivery of the books and other papers of the company, but that Messrs Borland, King, & Shaw, writers, claimed to have a lien over them in security of an account for law business incurred to them in connection with the promotion of the company; that he had been unable to obtain any information regarding the company or its affairs. It was in consequence of their refusal to give up these documents that the present application was made. A list of the documents specially called for, and being the prospectus, memorandum, articles, books, contracts of the company, &c., was appended to the note.

The liquidator prayed that the parties named being the whole shareholders might be cited for examination concerning the trade dealings of the company, and that they should be required to produce the books and documents in their custody, and further that under the 126th and 127th sections of the Companies Act of 1862 commission should be granted to the Sheriff of the county of Lanark, or any of his Substitutes at Glasgow, to examine the parties and documents, and to make report thereof to the Court.

Section 126 provides — “That … the Sheriffs of counties in Scotland shall be commissioners for the purpose of taking evidence under this Act in cases where any company is wound up.”…