Articles of association and share transmission: statutory documents cannot be rectified in equity, and an entitled executrix may seek registration.

Articles of association are statutory corporate documents whose legal effect depends on the registration scheme, so the ordinary equitable jurisdiction to rectify instruments does not apply unless statute authorises alteration. A person legally entitled to a deceased member's shares may, where the articles confer no veto or contrary transfer power, rely on the proper construction of the articles to claim the shares and require registration as holder of them. On that basis, the company could not resist entry of the executrix's name on the register in respect of the ordinary shares.

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Issues: (i) whether, on the true construction of the articles of association, the plaintiff was entitled to the 100 ordinary shares standing in the deceased member's name; (ii) whether the court had jurisdiction to rectify the company's articles of association; and (iii) whether the plaintiff was entitled to have her name entered on the register of members in respect of the ordinary shares.

Issue (i): whether, on the true construction of the articles of association, the plaintiff was entitled to the 100 ordinary shares standing in the deceased member's name.

Analysis: The articles, read as a whole, did not confer on the surviving members an enforceable right to compel the transfer of the ordinary shares to them on the death of a shareholder. The plaintiff, as the person entitled to the deceased member's shares, was therefore entitled to rely on the proper construction of the articles in support of her claim to the shares.

Conclusion: The issue was decided in favour of the plaintiff.

Issue (ii): whether the court had jurisdiction to rectify the company's articles of association.

Analysis: The memorandum and articles of association of a company are statutory documents whose effect depends upon registration under the Companies Act, 1908 and the Companies Act, 1929. The Court held that the ordinary equitable jurisdiction to rectify instruments does not extend to such documents, because their legal force arises only from the statutory registration scheme and any alteration must be made in the manner authorised by statute.

Conclusion: The court had no jurisdiction to rectify the articles of association.

Issue (iii): whether the plaintiff was entitled to have her name entered on the register of members in respect of the ordinary shares.

Analysis: Where an executrix is legally entitled to the deceased testator's shares, and the articles confer no power of veto on the company, she may insist on registration as holder of those shares as ancillary to her legal title. On that footing, the plaintiff was entitled to be registered as holder of the ordinary shares formerly standing in the deceased member's name.

Conclusion: The issue was decided in favour of the plaintiff.

Final Conclusion: The appeal succeeded, the cross-appeal failed, the dismissal of the action and counterclaim was set aside, and the plaintiff obtained the relief sought, including registration in respect of the ordinary shares.

Ratio Decidendi: Articles of association are statutory corporate documents, and absent an express statutory or contractual power, the court cannot rectify them by applying the general equitable jurisdiction applicable to ordinary instruments; a person legally entitled to a deceased member's shares may, unless the articles provide otherwise, require registration as holder of those shares.

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