Scottish Court of Session Decisions

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Cite as: [1896] ScotLR 33_414, [1896] SLR 33_414

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SCOTTISH_SLR_Court_of_Session

Page: 414↓

Court of Session Inner House First Division.

Thursday, March 12 1896.

33 SLR 414

The Scottish Accident Insurance Company, Limited, Petitioners.

Subject_1Company
Subject_2Resolution to Alter Memorandum of Association
Subject_3Confirmation by Court
Subject_4Companies (Memorandum of Association) Act 1890 (53 and 54 Vict. cap. 52), sec. 1 — Change of Name.
Facts:

A Petition presented by an Accident Insurance Company for confirmation of a resolution to alter its memorandum of association to the effect of enabling it to undertake life, fidelity, and certain other classes of insurance business, granted on condition that the name of the company should be altered in such a manner as should be approved of by the Court, so as to indicate the change which was being effected in the character of its business.

Judgment:

The Scottish Accident Insurance Company Limited, incorporated and registered under the Companies Acts, presented a petition for confirmation of an alteration of its memorandum of association under the Companies (Memorandum of Association) Act 1890, sec. 1.

The company was established under its memorandum of association for the purpose of carrying on the business of insurance against or upon accidental injuries to human life, and against injury to and destruction of property from any accidental cause other than fire. The alterations proposed to be made in the memorandum of association were designed to enable the company to extend the scope of its operations by transacting life, employers' liability, fidelity, and sickness insurance business, and to abandon the power of insuring property against loss caused by accident other than that of fire.

Two extraordinary general meetings of the company adopted and confirmed a special resolution giving effect to these alterations, but a second special resolution “that the name of the company be changed to ‘The Scottish Accident and Life Insurance Company, Limited,’ “ was not confirmed.

The Companies (Memorandum of Association) Act 1890 (53 and 54 Vict. cap. 62), sec. 1, empowers companies to alter the provisions of their memorandum of association subject to confirmation by the Court. Sub-sec. 5 provides—“The Court may confirm, either wholly or in part, any such alteration as aforesaid with respect to the objects of the company, if it appears that the alteration is required to enable the company (a) to carry on its business more economically or more efficiently; or ( b) to attain its main purpose by new or improved means; or (c) to enlarge or change the local area of its operations; or ( d) to carry on some business or businesses which under existing circumstances may conveniently or advantageously be combined with the business of the company; or ( e) to restrict or abandon any of the subjects specified in the memorandom of association or deed of settlement.”

Mr C. B. Logan, W.S., to whom the Court remitted to inquire and report on the petition, reported that the proceedings had been regular. On the reasons for the proposed alteration he said—“Your Lordships have in a previous case sanctioned, under the Act of 1890, the extension of the business of a Life Assurance Company so as to include accident insurance, and have also permitted an Accident Insurance Company to obtain powers to transact fidelity and guarantee business, and I have not been able to ascertain that there have been any cases, either in Scotland or in

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England, in which the Courts have authorised under the Statute of 1890 so important an extension of business as is now sought for.… I have therefore some difficulty in reporting whether the proposed extension can be held to be covered by the provisions of the Act, or whether it may not be necessary to reconstitute the company in order to accomplish the change. This is a matter which I feel it my duty to bring specially under your Lordship's consideration.” He further reported with regard to the name of the company—“It humbly appears to me that if the extension of powers asked for is granted by your Lordships, either in whole or in part, it would be proper that the name of the company should be altered so as to indicate the increased nature of the business. The petitioners are willing that the name of the company be changed to ‘The Scottish Accident, Life, and Fidelity Assurance Company Limited,’ and they are in communication with the Board of Trade for its approval to this change, as provided for under section 13 of the Companies Act of 1862.”

The petitioners expressed at the bar their consent to the proposed change of name.

Argued for the petitioners—The prayer of the petition should be granted. Such applications were only refused when the company sought to undertake a totally different kind of business from that which it had been established to transact— Glasgow Tramway and Omnibus Company Limited v. Magistrates of Glasgow, March 13, 1891, 18 R. 675; Young's Paraffin Light v. Mineral Oil Company Limited, January 16, 1894, 21 R. 384. All the new business proposed to be undertaken by the company was insurance business, and was not foreign to the company's original objects. The case was therefore similar to that of the Northern Accident Insurance Company, June 30, 1893, 30 S.L.R. 834, as well as to those of the Foreign and Colonial Government Trust Company, L.R. [1891], 2 Ch. 395; Alliance Marine Insurance Company, L.R. [1892], 1 Ch. 300; and National Boiler Insurance Company, L.R. [1892], 1 Ch. 306.

The Court pronounced the following interlocutor :—

… “Confirm the alteration of the memorandum of association & subject always to the condition that the name of the company be changed to ‘The Scottish Accident, Life, and Fidelity Insurance Company Limited,’ or such other name as may be resolved upon by the company, and approved of by the Board of Trade, as provided for by section 13 of the Companies Act 1862, and be approved by the Court under this petition; and for this end continue the cause, and decern.”

Counsel:

Counsel for the Petitioners— Lorimer— Crole. Agents— J. & R. A. Robertson, S.S.C.
1896