Unpaid Share Capital in Liquidation: contributory liability was enforced and the limitation objection to recovery was rejected.

In liquidation, liability to contribute arises under the statutory scheme governing contributories, and the decisive question is whether share money remains unpaid. The court accepted that the relevant shares were not fully paid and held that the respondents were liable for the unpaid balance, so they were placed on the list of contributories. It also held that the official liquidator's claim was not barred by limitation because the demand to make good unpaid share capital was treated as a statutory liability arising on liquidation, not an ordinary contractual claim. The limitation objection was therefore rejected, and recovery of the unpaid calls was allowed.

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Issues: (i) Whether the respondents were liable to be placed on the list of contributories for the amount claimed against them; (ii) whether the claim of the official liquidator was barred by limitation.

Issue (i): Whether the respondents were liable to be placed on the list of contributories for the amount claimed against them.

Analysis: Liability of a member to contribute in liquidation arises from the statutory scheme governing winding up and the list of contributories. Where share capital remains unpaid, the liquidator is entitled to require contribution according to the unpaid amount, and the question is determined by the actual state of payment of share money rather than by the form in which the company's records may have been manipulated. The court accepted the liquidator's case that the relevant shares were not fully paid and that the respondents remained liable for the unpaid balance.

Conclusion: The respondents were liable to be settled on the list of contributories for the amounts claimed against them.

Issue (ii): Whether the claim of the official liquidator was barred by limitation.

Analysis: The right of the liquidator to call upon contributories to make good unpaid share money was treated as a statutory liability arising upon liquidation and not as an ordinary contractual claim. On that basis, the ordinary limitation objection based on the date of the original calls was rejected. The court held that unpaid calls could be recovered in liquidation irrespective of the limitation defence relied upon by the respondents.

Conclusion: The claim of the official liquidator was not barred by limitation.

Final Conclusion: The application succeeded and the respondents were placed on the list of contributories for the quantified unpaid share amounts, with the limitation objection rejected.

Ratio Decidendi: In liquidation, liability for unpaid share capital is a statutory liability enforceable against contributories, and recovery of unpaid calls is not defeated by the ordinary law of limitation.

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