High Court of Australia Stephen, Mason, Murphy, Aickin and Brennan JJ. Maddocks v DJE Constructions Pty Ltd [1982] HCA 17 ORDER Appeal dismissed with costs. Cur. adv. vult. The Court delivered the following written judgment:— April 23 Stephen, Mason, Murphy, Aickin and Brennan JJ. This is an appeal from the Court of Appeal of the Supreme Court of New South Wales which allowed an appeal from Wootten J. in a proceeding instituted in the Equity Division. The early history of these proceedings, which is complex and not altogether clear from the documents in the appeal book, appears to be irrelevant to the present appeal and was so treated by the appellant who appeared in person and by counsel for the respondent. The issues with which this appeal is concerned are a claim by the respondent that the appellant was not a holder of any shares in the respondent and that he be restrained from exercising or attempting or purporting to exercise any powers or rights as a shareholder or member of the company and an order restraining the appellant from operating or attempting to operate or purporting to operate on the respondent's bank account. When the matter came on for trial before Wootten J. on 14 May 1980 the only question argued was whether the respondent was entitled to a declaration that the appellant was not a holder of any shares in the respondent. The material findings of fact made by Wootten J. may be summarized as follows. The company was incorporated under the Companies Act 1961 N.S.W. in July 1973. The subscribers to the memorandum of association were D. J. Ensor and D. L. Hanratty, each of whom subscribed for one share. Hanratty held his share on trust for one A. W. Logan. D. J. Ensor ("Ensor") and his father E. J. Ensor became directors of the company, the former being the managing director. E. J. Ensor held no shares in the company. In November 1974 the company made an application for a builder's licence under the Builders Licensing Act 1971 N.S.W. but was advised that such a licence would not issue except to a company which had a paid-up capital of at least $6,000. It appears that at some time in late 1974 Ensor and Logan agreed that the company should increase its issued shares by 5,998 shares and that on 28 November 1974 Logan gave Ensor a cheque drawn by one Veronica Reilly on her own bank account and that Logan then said: "This is the cheque for the issue of the 5,998 shares; give me a counter cheque to cover Miss Reilly's cheque because her cheque will bounce because there are no funds to meet it". On the same day Ensor gave Logan the cheque drawn on the respondent's account for the same amount, $5,998. After some mistiming which resulted in Miss Reilly's cheque being dishonoured the cheques were re-presented and the respondent's cheque paid to the credit of Miss Reilly's account and her cheque was again presented and honoured. At some later stage Logan said to Ensor: "I would like the shares issued in the name of J. D. Maddocks as nominee for me", to which Ensor agreed. Wootten J. found that it must have been arranged at an earlier stage that the shares would be issued to Logan or his nominee, even if the identity of the nominee was communicated later, but nothing turns on this aspect of the matter. On 28th January 1975 a return of allotment of shares in the respondent signed by Ensor as director was filed with the Corporate Affairs Commission. It stated that 5,998 shares had been allotted to the appellant on 20 January 1975 and a copy of that return was forwarded to the Builders' Licensing Board. There was however no communication between the appellant and any representative of the company. There was no meeting of directors to deal with the issue of shares. Until shortly before the hearing before the Court of Appeal the company had maintained no register of members and, as will appear, the appellant's name was at no time entered in the register. An uncompleted form of a share certificate purporting to be in respect of 5,998 shares in the name of the appellant was partly filled in by the company's accountant on 20 December 1974. It was however not signed by any director or by the secretary, nor was the seal of the company affixed to it, and in fact it was never removed from the share certificate book. The issue of the respondent's cheque for $5,998 to Logan was dealt with in the accounts of the company as an unsecured loan to him. Wootten J. found that Ensor believed that he had done everything that was necessary to make Maddocks the holder of the shares and if there were any defect if flowed not from want of intention to make Maddocks a member but "solely from Mr. Ensor's limited knowledge of the requirements of company law". The annual returns of the respondent for the years 1975 and 1976 also showed the appellant as the holder of 5,998 shares. Wootten J. took the view that a person whose name does not appear on the register of a company may nevertheless be proved to be a member in some circumstances, basing this view on Portal v. Emmens [1] . 1. (1876) 1 C.P.D. 201; 664. He then said that he could dispose of the matter on a different basis, namely that the making of a declaration was a matter of the exercise of a discretion and held that he would not be prepared to make the declaratory order even if entry in the register were necessary to complete membership. His Honour held that although Maddocks was not a party to the original agreement between the company and Logan, he must be taken to have agreed to become a member and that the company on its part agreed to accept him as a member. The respondent had relied on s. 67 of the Companies Act 1961 N.S.W., as amended, for an argument that the allotment and issue of these shares was illegal and void by reason of s. 67. Wootten J. held that the breach of s. 67 did not invalidate the allotment of the shares. Wootten J. refused the declaration sought by the company that the appellant was not a holder of shares in the company and also refused to order that the appellant be restrained from exercising or purporting to exercise the powers and rights of a shareholder. From that decision the respondent appealed to the Court of Appeal. The appeal came on for hearing before Street C.J., Glass and Samuels JJ.A. That Court allowed the appeal. In the course of the proceedings in the Court of Appeal the respondent was given leave to tender its share register. That register disclosed that there were three members of the company but that the respondent's name did not appear in the share register or in the application and allotment journal. It does not appear when that share register came into existence but Wootten J. had said in his judgment of 26 June 1980 that there was at that stage no register. It seems reasonable to assume that the register which was produced and tendered before the Court of Appeal had come into existence at some date between 26 June 1980 and the hearing in the Court of Appeal in 1981. The register having been tendered in the course of argument, the appellant sought and obtained from the Court of Appeal leave to file a cross claim seeking an order that the register be rectified by the entry therein of his name as the holder of 5,998 shares, the date of allotment to be shown as 20 January 1975. It appears from the judgments that the principal question argued before the Court of Appeal was whether or not there was a contract binding the respondent and the effect of the infringement of s. 67 which each of the members of the Court regarded as fatal to the appellant. Street C.J. examined the authorities on s. 67 and concluded that when a party is faced with the necessity of proving an agreement which infringes s. 67, then that section, having made the agreement illegal and void, produces the result that such party cannot obtain rectification of the register based upon the illegal agreement. He pointed out that the position is otherwise where a person has become a shareholder entered on the register as the result of a dealing which involves a breach of s. 67, at least in the sense that his presence on the register establishes that he has in fact become a shareholder. He concluded that Maddocks' application for rectification of the register must fail because it depended upon the illegal transaction. Glass J.A. agreed with the reasons for judgment of the Chief Justice and those of Samuels J.A. Samuels J.A. pointed out that there was no evidence that any notice of the allotment of the shares (which he found to have taken place sometime in December or January 1975) was ever communicated to the appellant either by the company or by the directors, or indeed communicated to Logan who had made the offer to take up the shares. He pointed out that the shares were never "issued" to the appellant in the sense that he became vested with complete control, nor was his name put on the register when it came into existence. He concluded that it was clear that at no time had there been any contract between the company and the appellant, nor was any offer made by the appellant or by the respondent which could have been accepted. He concluded that any claim by the appellant to be on the register depended upon a contract between the company and Logan. He then concluded that because of the arrangement for the provision of funds by the respondent to enable the application moneys to be paid the whole contract was illegal and void. Samuels J.A. concluded that the appellant could not set up the allotment as an independent basis for the relief claimed without resorting to the contract (assuming all other points in his favour) and he could not point to any completed contract which ought to remain undisturbed but that he had to use the illegal contract in order to obtain completion by registration. He concluded therefore that the claim for rectification failed. From that decision of the Court of Appeal the appellant appealed to this Court. The grounds of the appeal were primarily concerned with the question whether s. 67 applied. There is no ground of appeal expressly directed to the order refusing rectification of the register. It is however desirable to deal with the matter upon the footing that there was an appeal against that order. It is desirable before considering the effect of s. 67 to consider the other questions which arise. The starting point must be that the appellant was not, and never had been, entered on the register of the respondent as a shareholder. Until the matter reached the Court of Appeal there had not been a register in existence and when one did come into existence the appellant's name was not entered on the register. It is also clear that there was no agreement between him and the company by which he was to become a shareholder and have his name entered on the register. The evidence suggests that it was the intention of Logan that the shares should be placed in the name of Maddocks who was to hold them as nominee for Logan but it is clear that there was no communication between the company or its directors and Maddocks and it is equally clear that his name was not entered on the register of shareholders. The trial judge took the view that the decision in Portal v. Emmens [2] demonstrated that a person whose name does not appear on the register may nevertheless be proved to be a member in some circumstances, e.g. where there is no register. 1. (1876) 1 C.P.D. 201; 664. An examination of Portal v. Emmens however demonstrates that it is not authority for any such proposition. It is important to remember that the company with which that case was concerned was a company created by a private Act of Parliament to which the Companies Clauses Consolidation Act 1845 applied. The special Act incorporating the Didcot, Newbury, and Southampton Junction Railway Company (36 & 37 Vict. c. CCXXIX) provided in s. 2 that the Companies Clauses Consolidation Act 1845 and certain other provisions of the Railways Clauses Act and other Acts should be "incorporated with and form part of this Act". Section 4 of the special Act provided that: William Emmens, J.R. Engledue, H. Vigne, and all other persons and corporations who have already subscribed to or hereafter shall become proprietors in the undertaking, and their executors, administrators, successors, and assigns respectively, shall be and are hereby united into a company for the purpose of making and maintaining the railway, and for other the purposes of this Act, and for those purposes shall be and are hereby incorporated by the name of The Didcot, Newbury, and Southampton Junction Railway Company, and by that name shall be a body corporate, with perpetual succession and a common seal. Section 14 provided that: The first ordinary meeting of the company shall be held within nine months after the passing of this Act; and the quorum for general meetings, whether ordinary or extraordinary, shall be seven shareholders holding together not less than 20,000l. in the capital of the company. Section 18 provided that: William Emmens, J. R. Engledue, H. Vigne, and two persons to be nominated by them or the majority of them, and consenting to such nomination, shall be the first directors of the company, and shall continue in office until the first ordinary meeting held after the passing of this Act. At that meeting the shareholders present in person or by proxy may either continue in office the directors appointed by this Act or nominated as aforesaid, or any of them, or may elect a new body of directors, or directors to supply the place of those not continued in office, the directors appointed by this Act or nominated as aforesaid being, if qualified, eligible for re-election. The case stated which was heard in the Common Pleas Division by Grove, Archibald and Lindley JJ. indicated that no first ordinary meeting of the company was held, nor any meeting of directors, nor any general meeting of shareholders, nor was there any register of members, nor were any shares allotted to Emmens or any other person; nor was he ever a shareholder unless the statute operates as an allotment or makes him a shareholder, nor was any director other than the three named persons appointed. The Court said [3] : This much we think is clear: — 1. The company was created and incorporated, and became capable (as from the date of the Act) of acquiring rights and incurring debts and obligations: 2. The agreement mentioned in the schedule became binding as between the plaintiff on the one side and the company on the other, and the company became bound to pay the sum of 315l. mentioned in clause 11 of the agreement on or before the 1st of December, 1873, whether any shares were issued or not, and whether any general meeting of shareholders should be held or not previously to that time: 3. The defendant and the other persons mentioned in s. 4 became by the Act members of the company: See as to this Cromford and High Peak Ry. Co. v. Lacey [4] and Scott v. Berkeley [5] , where, however, the Court held that the defendant had ceased to be a member before judgment against the company was recovered: 4. The defendant and the other persons mentioned in s. 18 became the first directors of the company. They then said [6] : The conclusion at which we have arrived from a careful study of the two Acts is, that the special Act constitutes the defendant a shareholder in respect of thirty shares, within the meaning of s. 36 of the general Act. The Court concluded by saying [7] : The question which we have to consider is, whether a person who by statute is made a member and director of a company, and is required to hold a certain number of shares, and whose duty it was to cause numbered shares to be appropriated to himself, and to cause himself to be registered as a shareholder, and who would plainly be liable to a scire facias if he had performed his duty in these respects, which he has not, can avail himself of his own breach of duty, and successfully contend that he is not a shareholder within the true meaning of s. 36 of the Companies Clauses Consolidation Act 1845. We are of opinion that he cannot. It is apparent that the essential feature of the case was that the special Act itself made Emmens both a member and a director and it is not at all surprising that it was found in the context of the special Act and of s. 36 of the Companies Clauses Consolidation Act that Emmens was regarded as a member and liable in the proceedings brought against him, the nature of which it is not necessary to elaborate. That decision was upheld by the Court of Appeal [8] . Their Lordships took a somewhat different view of the matter but arrived at the same conclusion. Cockburn C.J. said [9] : The ground on which I base my decision is this: the defendant was one of the persons at whose instance the special Act was obtained; therefore he is a party to the engagement mentioned in the schedule to the Act between the plaintiff and the company, and is bound by that engagement. By the Act the defendant and two other gentlemen got themselves constituted directors of the company; so far as the general public are concerned they might not be bound to act in the exercise of their functions as directors; but so far as the plaintiff is concerned, he being a person with whom there was a binding agreement for good consideration to which they were parties, they incurred an obligation to exercise their powers as far as was necessary for the purpose of carrying out the bargain. Under these cricumstances I think that they cannot be heard to say that they are not directors and have not all powers necessary to the carrying out of the agreement with the plaintiff. With that conclusion Jessel M.R. agreed but he added that he agreed with the decision of the Court below upon the main points discussed. He said [10] : By the 4th section the defendant and certain others are made a body corporate under the name of the Didcot, Newbury, and Southampton Junction Railway Company. He must therefore be a member of the company, for he is one of the corporators. Apart from the 3rd section of the Companies Clauses Consolidation Act how can the defendant be a corporator unless he is a shareholder? The only possible members or corporators of a company are its shareholders. It is therefore clear on the terms of the special Act that the defendant must be considered as holding at least one share. But did he hold more? I think that the Act makes him the holder of the number of shares specified in s. 16 as the qualification of a director. It provides that he shall be a director, and continue so until the first ordinary meeting. He is therefore a director from the moment of the passing of the Act. The 16th section provides that the qualification of a director shall be the possession of thirty shares. The defendant petitioned for the passing of the Act, and accepted office on those terms, and agreed that he should be qualified in that way. I think, therefore, that he is a shareholder to the extent of thirty shares. He said [11] : The next point that was urged was the non-existence of a register. It is clear that there cannot be a register in the strictest sense of the term until the book is sealed at the first ordinary meeting. But it is also clear from the Act that there must be shareholders before that, for the first ordinary meeting is to be a meeting of shareholders. The company may have to incur obligations before the meeting. For instance, they may have to give notice to take lands, and many other things might be mentioned which involve liability. It never could be intended that the whole action of the company should be paralysed during this period, especially when it is taken into consideration that the time for the exercise of their powers to take land is limited. There is nothing in the Companies Clauses Consolidation Act to lead to the conclusion that the existence of a register is necessary in order that there may be shareholders against whom a sci.fa. may issue. Mellish J. said [12] : That he became a member of the company is clear. The 4th section says that he and several others shall be united into a company. He petitioned Parliament, however, to pass the Act by which he was to be constituted a director, and by which the qualification of a director was to be thirty shares. I think that, putting the provisions of the Act together, it is not straining the words of the Act to say that he consented to be a director and to be qualified as the holder of thirty shares; and the meaning of the Act is, that directly the Act passed he did become a director and the possessor of that number of shares. 1. (1876) 1 C.P.D., at pp. 209-210. 2. (1829) 3 Y. & J. 80 [148 E.R. 1101]. 3. (1847) 3 C.B. 925 [136 E.R. 371] 16 L.J. (C.P.) 107. 4. (1876) 1 C.P.D., at p. 214. 5. (1876) 1 C.P.D., at p. 219. 6. (1876) 1 C.P.D. 664. 7. (1876) 1 C.P.D., at p. 666. 8. (1876) 1 C.P.D., at p. 667. 9. (1876) 1 C.P.D., at p. 668. 10. (1876) 1 C.P.D., at pp. 668-669. The effect of Portal v. Emmens is succinctly stated in the judgment of the Court of Appeal in Kipling v. Todd [13] where Thesiger L.J., speaking for Bramwell, Baggallay L.JJ. and himself, said [14] : "We cannot agree with the argument of Mr. Benjamin that the ratio decidendi" [of Portal v. Emmens] "was limited to the narrow ground of an estoppel founded upon the special circumstances of the case, although the judgment of the Lord Chief Justice Cockburn [15] , and the concluding passages of the judgment of the Master of the Rolls [16] lend some colour to the argument; but we read the judgment as deciding that where, by an Act of Parliament, persons' names are incorporated into a company having a share capital, and the same persons are also named as directors, while the holding of a certain number of shares is prescribed as a qualification for the office of directors, these legal consequences follow: First, Each corporator ex necessitate rei becomes a member of the company, and as such, and apart from the definition of shareholder given in s. 3 of the Companies Clauses Consolidation Act 1845, must be considered as holding at least one share in the company; and each person named as a director must be considered as holding at least the number of shares constituting the prescribed qualification: Secondly, Section 36 of the last-mentioned Act, under which the scire facias in this and similar cases is issued, authorizes its issue against any shareholder. Section 3 of the same Act defines "shareholder" as meaning "shareholder, proprietor, or member of the company," and consequently execution may issue against a person who by the special Act is constituted a director, a member of the company, and therefore a shareholder. The decision in Portal v. Emmens [17] , though going to the length we have mentioned appears to us to go no farther, and the facts there proved shewed that the defendant on the one hand had done nothing for the purpose of getting rid of his position as director, with its consequent obligations, and on the other hand had done nothing towards satisfying the liability of the plaintiff, under which the company by its special Act itself had come." 1. (1878) 3 C.P.D. 350. 2. (1878) 3 C.P.D., at pp. 356-357. 3. (1876) 1 C.P.D., at p. 666. 4. (1876) 1 C.P.D., at p. 668. 5. (1876) 1 C.P.D. 201; 664. That passage demonstrates clearly that Portal v. Emmens does not establish that, even under the Companies Clauses Consolidation Act, the absence of a share register will itself authorize or require persons not on the register being treated as members or shareholders. It deals only with persons made members by an Act of Parliament. The provisions of the Companies Act 1862 (25 & 26 Vict. c. 89) produce substantially the same effect, though necessarily adapted to the new mode of incorporation which no longer required a "special" or "private" Act of Parliament. Section 6 provided as follows: Any Seven or more Persons associated for any lawful Purpose may, by subscribing their Names to a Memorandum of Association, and otherwise complying with the Requisitions of this Act in respect of Registration, form an incorporated Company, with or without limited Liability. Section 18 provided: The Subscribers of the Memorandum of Association, together with such other Persons as may from Time to Time become Members of the Company, shall thereupon be a Body Corporate by the Name contained in the Memorandum of Association, capable forthwith of exercising all the Functions of an incorporated Company, and having perpetual Succession and a Common Seal, with Power to hold Lands, but with such Liability on the Part of the Members to contribute to the Assets of the Company in the event of the same being wound up as is herein-after mentioned: A Certificate of the Incorporation of any Company given by the Registrar shall be conclusive Evidence that all the Requisitions of this Act in respect of Registration have been complied with. Section 23 provided: The Subscribers of the Memorandum of Association of any Company under this Act shall be deemed to have agreed to become Members of the Company whose Memorandum they have subscribed, and upon the Registration of the Company shall be entered as Members on the Register of Members herein-after mentioned; and every other Person who has agreed to become a Member of a Company under this Act, and whose Name is entered on the Register of Members, shall be deemed to be a Member of the Company. In In re Florence Land and Public Works Co. (Nicol's Case) [18] , Bowen L.J. said in relation to the Companies Act 1862: But the 23rd section defines the status of a subscriber of the memorandum in a different way to the position of other persons who agree to become members. From a comparison of the three sects. 6, 18, and 23, it is clear to me that the subscription of the memorandum is of itself the initial act in creating the corporate body. Under sect. 6, upon the registration of the company, a subscriber of the memorandum actually becomes a corporate member. Then sect. 18 says that on the registration of the memorandum and articles the corporate body comes into existence, and is composed of the subscribers of the memorandum and of all other persons who may from time to time become members. Then, by the 23rd section, subscribers of the memorandum are to be deemed to have agreed to become members, and upon the registration of the company "they shall be registered;" there is no option given in their case. The object of the provision, as pointed out in Migotti's Case [19] , was mainly that the public might rest with confidence on the subscribers of the memorandum becoming members of the company. Neither the reason nor the language of the Act applies to other persons who afterwards agree to become members. Fry L.J. [20] made similar observations as to the effect of ss. 18 and 23 where he said: "The short effect of sect. 18 is, in my opinion, to make these two gentlemen members of the company." 1. (1885) 29 Ch.D. 421, at p. 444. 2. (1867) L.R. 4 Eq. 238. 3. (1885) 29 Ch.D., at pp. 445-446. Subsequent legislation over more than one hundred years has added greatly to the length and number of provisions in the 1862 Act and to the corresponding Acts passed in the Australian colonies in the years following 1862. The Companies Act 1961 N.S.W., as amended, reproduces the basic structure and the position of those who sign the memorandum of association is the same as in the 1862 Act, and indeed corresponds with that of persons named in the private Acts incorporating companies. The material provisions of the New South Wales Act are s. 14 (1) and s. 16 (4) and (5). Section 14 (1) is as follows: Subject to this Act any five or more persons or, where the company to be formed will be a proprietary company, any two or more persons associated for any lawful purpose may by subscribing their names to a memorandum and complying with the requirements as to registration form an incorporated company. Section 16 (4) and (5) are as follows: (4) On and from the date of incorporation specified in the certificate of incorporation, but subject to this Act, the subscribers to the memorandum together with such other persons as may from time to time become members of the company shall be a body corporate by the name contained in the memorandum capable forthwith of exercising all the functions of an incorporated company and of suing and being sued and having perpetual succession and a common seal with power to hold land but with such liability on the part of the members to contribute to the assets of the company in the event of its being wound up as is provided by this Act. (5) The subscribers to the memorandum shall be deemed to have agreed to become members of the company and on the incorporation of the company shall be entered as members in its register of members, and every other person who agrees to become a member of a company and whose name is entered in its register of members shall be a member of the company. Sub-section (5) draws the distinction between the subscribers to the memorandum who are deemed to become members prior to the entry of their names in its register, and other persons who after incorporation agree to become members and whose names are later entered on the register. It was established as long ago as 1867 that a subscriber to the memorandum of association of a company incorporated under the 1862 Act becomes a member of the company whether his name was entered on the register or not — In re London, Hamburgh, and Continental Exchange Bank (Evans's Case) [21] . Subscribers' shares are deemed to have issued at the date of registration of the company: Dalton Time Lock Co. v. Dalton [22] ; In re Ebenezer Timmins & Sons Ltd [23] . 1. (1867) 2 Ch. App. 427. 2. (1892) 66 L.T. 704. 3. [1902] 1 Ch. 238. These authorities and statutory provisions to which they relate make it clear that a person who is not a subscriber to the memorandum of association is not and cannot become a member unless and until he agrees to become a member and his name is entered in the register of members. In this respect the view of Wootten J. must be rejected. In the present case it is not in dispute that the appellant did not agree to become a member and that his name is not, and never has been, entered on the register of members. Moreover his application to have the register rectified to show his name as a member holding 5,998 shares was rejected by the Court of Appeal. The authorities are clear that in the case of a person who subsequently to incorporation applies for shares to be allotted to him, or purchases shares from an existing shareholder, does not become a member of the company until his name is entered in the share register. In the present case the name of the appellant was at no time entered in the share register. It is irrelevant that for a long period the company had not had a register of shareholders. No claim was made in the Court of Appeal that the register produced at the hearing was not a genuine register and the fact that it was a belated compliance with the Act by the directors and secretary of the company does not affect the matter at all. The outline of submissions handed to the Court on behalf of the appellant makes no mention of the application to rectify the register and in the course of oral argument the appellant said that he would be concentrating on s. 67 but that he proposed to argue that the full legal status of a shareholder arises at the time of the allotment and that the share certificate and perhaps the register are just evidence. He argued however that there were two proceedings, the second having been started in the Court of Appeal when the share register was tendered in evidence. There was then filed a cross claim by the appellant seeking rectification of the register. In the course of his argument in this Court he stated that the order which he sought was that the respondent's appeal to the Court of Appeal should have been dismissed and that he should be able to institute a new proceeding to establish that the share register produced was not a genuine register. At a subsequent stage he said that he wished to withdraw his application in the Court of Appeal to rectify the register. Counsel for the respondent pointed out that there was nothing which the appellant could withdraw except his appeal and that, although he was now seeking to say that it was not a proper register, no such suggestion had been made in the Court of Appeal and that he had there applied after the register had been before the Court to have that register rectified. There can be no doubt that on this point it is open to the appellant to argue that the decision of the Court of Appeal on the rectification application was wrong but it is equally without doubt that it is not possible for him to withdraw the application once it had been made and judgment given on it. The time for discontinuance or "withdrawal" expired on the giving of judgment by the Court of Appeal. In that sense the appellant is bound by the result in the Court of Appeal unless the decision be upset on appeal. Although the appellant did not argue the substance of his appeal against the refusal of rectification by the Court of Appeal, it is desirable that the Court should deal with that question. It is not disputed that the appellant's name is not on the share register, there is no finding that the share register is otherwise than a genuine share register, and indeed it would be inconsistent with the appellant's application to rectify the register to contend that there was no register or that the register in evidence was not a genuine register. Having launched his application to rectify the existing register by having his name entered therein, it is not open for the appellant to contend that there was no register or no "proper" or "genuine" register. It is also not disputed that there was no agreement between the appellant and the respondent by which he agreed to take shares and the company agreed to allot them, whether arising out of an offer made by him to the company or an offer made to him by the company. It is eqully clear that no notification was given to him of the allotment of shares by the company nor does it appear that at the time of the arrangement between Logan and Ensor he was aware of what passed between them. It does not appear at what point of time he became aware of the entries made in the returns of allotment which, pursuant to the provisions of the Companies Act, were lodged with the Commissioner of Corporate Affairs in the years 1975-1977. The return in respect of 1977 stated that the shares were held by Mr. Maddocks as trustee for Mr. Logan. It should also be noted that there was no evidence of communication at all between the company or its directors and Mr. Maddocks until some litigation between them began in 1978. Moreover the facts referred to establish that the shares were never "issued" to the appellant within the meaning of that term in the Companies Act. The meaning of this term is discussed by Dixon J. in Central Piggery Co. Ltd. v. McNicoll and Hurst [24] where he said: Speaking generally the word "issue" used in relation to shares means, where an allotment has taken place, that the shareholder is put in control of the shares allotted. A step amounts to issuing shares if it involves the investing of the shareholder with complete control over the shares. In re Ambrose Lake Tin and Copper Co. (Clarke's Case) [25] makes that quite clear. Cockburn L.C.J. said: —"inasmuch as the term "issue" is used, it must be taken as meaning something distinct from allotment, and as importing that some subsequent act has been done whereby the title of the allottee becomes complete, either by the holder of the shares receiving some certificate, or being placed on the register of shareholders, or by some other step by which the title derived from the allotment may be made entire and complete." [26] 1. (1949) 78 C.L.R. 594, at pp. 599-600. 2. (1878) 8 Ch.D. 635. 3. (1878) 8 Ch.D., at p. 638. Even if there had been an "allotment", which is by no means clear, there was nothing that was done which could constitute an issue of the shares, but more importantly than that, there is nothing by reason of which the appellant could be regarded as the holder of the shares or a member of the company. It may be observed that the appellant did not at any stage of the proceedings give evidence himself or swear any affidavit as to his position in the matter and his knowledge or lack thereof in relation to any of the events. He was of course not bound to do so and it is clear enough that the trial judge did not disbelieve any of the witnesses although in one respect he thought that the recollection of one witness must be mistaken. The situation may be summarized by saying that the appellant having made an application to rectify the register by having his name thereon as the holder of 5,998 shares in the company and the Supreme Court having refused his application to rectify, there is a decision of the Court of Appeal that he is not a member of the company and that his name is not on the register as a member. He did not in the Court of Appeal dispute the authenticity of the register but indeed relied upon it as being the register. The Court of Appeal rejected his application for rectification. For the reasons given above the argument that in the circumstances of this case the appellant can be a member or shareholder notwithstanding that his name was not on the register must be rejected. The terms of the Companies Act itself make that argument untenable. The appellant sought rectification which was refused by the Court of Appeal. Upon the assumption that the notice of appeal was adequate to challenge the decision of the Court of Appeal in this respect, he has failed to advance any argument which could result in the register being rectified or there being some declaration in his favour. That conclusion having been reached, it becomes unnecessary to consider the question of illegality under s. 67 of the Companies Act. A decision in the appellant's favour on that point could not improve his position since he is not on the register and his appeal against the rejection of his application to rectify the register has failed. The appeal should be dismissed.