Registered shareholder status and displaced persons debt relief apply despite an unregistered transfer and an earlier share call

A company was entitled to treat the registered shareholder as the owner of shares until the register was altered, so an unregistered transferee could not displace the transferor in dealings with the company. The transferor therefore remained entitled to maintain the claim against the company. Section 19 of the Displaced Persons (Debts Adjustment) Act also applied where a call had been made before 15 August 1947, provided the shares were held by the displaced person on that date and the statutory conditions were otherwise satisfied. The declaration for the respondent was sustained.

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Issues: (i) Whether, as between the company and the transferor, the registered shareholder continued to be treated as the holder of the shares despite an unregistered transfer. (ii) Whether section 19 of the Displaced Persons (Debts Adjustment) Act applied where the call had been made before 15 August 1947 but the shares were held by the displaced person on that date.

Issue (i): Whether, as between the company and the transferor, the registered shareholder continued to be treated as the holder of the shares despite an unregistered transfer.

Analysis: The registered holder remained on the company register and, under the company's articles, the company was entitled to treat that holder as the absolute owner of the shares and was not bound to recognise any equitable or other claim of another person. Until the register was altered and the transferee entered as shareholder, the transferor retained the right to deal with the company in matters relating to the shares. Any dispute between transferor and transferee was separate from the company's position.

Conclusion: Yes. The transferor was entitled to maintain the claim against the company and was to be treated as the holder of the shares.

Issue (ii): Whether section 19 of the Displaced Persons (Debts Adjustment) Act applied where the call had been made before 15 August 1947 but the shares were held by the displaced person on that date.

Analysis: The provision required that the call be made upon a displaced person in respect of moneys unpaid on shares held by him on 15 August 1947. Nothing in the text required the call itself to be made on or after that date. The section therefore covered calls made earlier, provided the shares were held by the displaced person on the relevant date and the other statutory conditions were met.

Conclusion: Yes. The section applied to the case.

Final Conclusion: The appeal failed, and the order granting the declaration in favour of the respondent was sustained.

Ratio Decidendi: A company may treat the registered shareholder as the owner until the register is altered, and section 19 of the Displaced Persons (Debts Adjustment) Act is attracted if the shares were held by the displaced person on 15 August 1947, even when the call was made earlier.

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