Constructive trustee of partly paid shares cannot be forced to acquire new shares with fresh liabilities for the beneficiary.

A constructive trustee of partly paid shares cannot be compelled to buy further shares in his own name under a pre-emptive allotment offer where that would expose him to fresh personal liability and future calls; the beneficiary is entitled only to the benefit attached to the original holding, not to impose new burdens on the trustee. A requisition must clearly identify the true beneficiaries and provide an effective indemnity; an uncertain or incomplete demand is insufficient in law. The receiver, whose name was not on the register, could not force allotment or registration of the new shares in his name, and damages were unavailable because no valid demand or enforceable entitlement was shown.

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Issues: (i) Whether a transferor of partly paid shares, holding the legal title as constructive trustee for the transferee, could be compelled to apply in his own name for further shares offered under the company's pre-emptive allotment provision for the transferee's benefit; (ii) whether the requisition made upon the transferor was valid and sufficient in law to require him to act on it; (iii) whether the receiver, and consequentially the company, could be compelled to have the newly issued shares allotted and registered in the receiver's name and whether the plaintiffs were entitled to the reliefs sought.

Issue (i): Whether a transferor of partly paid shares, holding the legal title as constructive trustee for the transferee, could be compelled to apply in his own name for further shares offered under the company's pre-emptive allotment provision for the transferee's benefit.

Analysis: The beneficial owner of the original shares was entitled to the advantages annexed to those shares, but the equitable obligation of a constructive trustee could not be extended so as to compel him to acquire additional shares in his own name where that course would impose fresh personal liabilities and future calls. The right arising from the new issue was not treated as an incident that automatically bound the transferor to become a trustee of the new shares themselves. The trustee could be required to pass on the benefit by renunciation, but not to invest his own money and expose himself to additional obligations for the beneficiary's advantage.

Conclusion: The transferor could not be compelled to purchase the further shares in his own name for the transferee's benefit.

Issue (ii): Whether the requisition made upon the transferor was valid and sufficient in law to require him to act on it.

Analysis: The requisition did not clearly identify all the true beneficiaries, did not establish their entitlement with certainty, and did not provide an effective and secure indemnity against the prospective liabilities attached to the new shares. A trustee is bound only by a proper and effective demand; an incomplete or uncertain direction does not create default. The offer to indemnify was too indefinite to protect the transferor against possible future burdens.

Conclusion: The requisition was ineffective and insufficient in law.

Issue (iii): Whether the receiver, and consequentially the company, could be compelled to have the newly issued shares allotted and registered in the receiver's name and whether the plaintiffs were entitled to the reliefs sought.

Analysis: The privilege to claim the new shares under the relevant company provision belonged to a member whose name stood on the register. The receiver's name was not on the register, and the company was not bound in the suit between the transferor and transferee to recognize him as a member or to allot the new shares in his name. In the altered situation after lapse of the sanction for fresh capital, the reliefs originally granted could not be sustained, and damages also failed in view of the absence of a valid demand and the inability to compel the trustee to take the shares.

Conclusion: The receiver and the plaintiff were not entitled to the allotment or registration reliefs, and no damages were payable.

Final Conclusion: The constructive trustee was bound to pass on the benefit of the new offer only by renunciation, not to acquire new partly paid shares with fresh liabilities for the beneficiary, and the plaintiffs failed for want of a valid requisition and enforceable entitlement to registration or allotment.

Ratio Decidendi: A constructive trustee of sold shares cannot be compelled, merely by reason of the earlier transfer, to buy additional partly paid shares in his own name where doing so would expose him to fresh personal liabilities; the beneficiary is entitled only to the benefit annexed to the original holding, and relief depends on a proper, effective, and sufficiently protective requisition.

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