Provisional liquidator's appointment does not automatically defeat managing agents' authority to execute a valid company mortgage.

Appointment of a provisional liquidator does not, by itself, automatically vest a company's property in him or extinguish the managing agents' authority. His powers remain confined to the terms of the appointment order and any later directions of the court. Where the winding-up petition was no longer pressed and the court restored charge of the company and its affairs to the managing agents, they remained entitled to deal with company property in accordance with law. A mortgage executed by them pursuant to the company resolution and court directions was therefore valid, supported by consideration, and binding on the company.

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Issues: Whether the mortgage executed by the managing agents of the company was valid and binding despite the appointment of a provisional liquidator in the pending winding-up proceedings.

Analysis: The appointment of a provisional liquidator under the Companies Act does not, by itself, cause an automatic vesting of the company's properties in him. His powers are governed and limited by the order of appointment and any subsequent orders of the court. Where the winding-up petition was no longer pressed and the court directed that charge of the company and its affairs be handed over to the managing agents, the managing agents remained entitled to deal with the company's properties in accordance with law. The provisional liquidator could not assert an absolute or independent right akin to an official liquidator so as to invalidate acts done by the managing agents pursuant to the court's directions and company resolution.

Conclusion: The mortgage was valid, supported by consideration, and binding on the company; the objection based on the provisional liquidator's appointment failed.

Final Conclusion: The appeal failed because the managing agents had lawful authority to execute the mortgage, and the decree in favour of the plaintiff was affirmed.

Ratio Decidendi: Appointment of a provisional liquidator does not automatically divest the company of its property or extinguish the managing agents' authority where the court's orders preserve or restore control to them; the liquidator's powers remain subject to the terms of the court's appointment order.

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