The Athenaeum Life Assurance Society ex parte The Prince of Wales Life and Educational Assurance Company
| Jurisdiction | England & Wales |
| Judgment Date | 19 February 1859 |
| Date | 19 February 1859 |
| Court | High Court of Chancery |
English Reports Citation: 44 E.R. 1423
BEFORE THE LORDS JUSTICES.
S. C. Johns. 80.
[660] In the Matter of the athen^um life assurance society. Ex parte the prince op wales life and educational assurance company. Before the Lords Justices. Jan. 26, 27, 29, Feb. 19, 1859. [S. C. Johns. 80.] A policy of assurance granted by the A. company provided that the capital stock of 100,000, and other the property of the company remaining at the time of the 1424 IN RE ATHENAEUM LIFE ASSURANCE COMPANY 3DB 0. & J. 61. claim unapplied and inapplicable to prior claims, should alone be liable to pay the sum assured, arid that no shareholder should he liable beyond the amount unpaid of his shares in the capital stock. Not more than 49,000 out of the 100,000 was ever subscribed for. The life having dropped, the assured claimed the sum payable under the policy; and an order having been made for winding up the company, a claim for the amount was carried in and disallowed, upon which the assured sued the official manager at law, and obtained judgment, the jury finding that there was sufficient property of the company applicable to pay the demand. Held, that by the special contract contained in the policy, the liability of the individual shareholders was effectually limited to the amount remaining unpaid on their respective shares, and that they could not be made further liable, either on the ground that the policy contained an engagement that the property of the company should be applied in due course in payment of the sum assured by the policy and that the judgment established the existence of capital sufficient to pay it, or on the ground that the policy contained an untrue representation that the capital was 100,000, which representation the persons making it were bound to make good; or on the ground that the official manager represented the shareholders in the action. The costs of the action were, however, allowed as a general debt against the con-tributories, on the ground that they were part of the necessary expenses of the winding up. This was an appeal from part of an order of Vice-Chancellor Wood, who had decided that those shareholders in the Athenfeum Life Assurance Society who had paid up the full amount on their shares were free from all liability in respect of certain policies of that society effected by the Appellants the Prince of Wales Life Assurance Society. The Athenffium Society was a joint stock company, registered under 7 & 8 Viet, c. 110. By the 4th clause of the deed of settlement it was provided that the capital 661] should consist of 100,000 in 100,000 shares, with a power of increasing it: "provided, nevertheless, that in case the whole of the 100,000 shall not be subscribed for or disposed of, the shareholders of the society for the time being shall continue associated and bound under and by these presents, and the powers and provisions herein contained shall continue and be valid in respect of the shares for the time being subscribed for or taken, in like manner as if the number of such shares had been the whole number of shares agreed or intended to be issued." The total amount of shares actually subscribed for was never more than about 49,000. The 28th clause of the deed of settlement, prescribing the form of the policies to be granted, was as follows :- "That any policy, endowment, grant of annuity or other instrument required in any of the transactions aforesaid shall be given under the hands of not less than three of the directors, and be sealed with the common seal of the society ; and that there shall be contained therein, and in every other contract to be entered into on behalf of the society in or about the premises, a reference to these presents, and a proviso limiting the scope and effect of the contract thereby created, so that the same shall take effect and be satisfied only out of such funds and property of the society as under the provisions hereinafter contained shall at the time at which such liability shall accrue be at the disposal of the directors in that behalf, and negativing an unconditional liability. Provided always that nothing herein or in such contract contained shall limit the liability of any shareholder as to the performance of such contract, or prejudice the rights of any person or persons against any shareholder under or by virtue of the aforesaid statute," i.e., the 7 & 8 Viet. c. 110. The Prince of Wales Society having granted to a Mr. [662] Trulock certain policies in the life of Mr. E. P. H. Jodrell, effected, in 1854, with the Athenueum Society, policies to the amount of 10,500 on Jodrell's life. The witnessing part of each of these policies was in the following form :- " Now this policy witnesseth, that if the said R. P. H. Jodrell shall die before or on the said 2d day of September 1855, or shall live beyond that day, and the said assured or his assigns, or the holder of this policy who shall be registered...
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The Joint Stock Companies Winding-Up Acts, 1848 and 1849; and The Joint Stock Companies Winding-Up Amendment Act, 1857; and The State Fire Insurance Company
...solvent and properly managed no inconvenience can arise from holding the policy to create a lien. Re AthencBum Life Assurance Society (3 De G. & J. 660) was referred to. Judgment reserved. August 4. [THE lord justice turner, after stating the nature of the question which had arisen, and the......
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Re the Athenaeum Life Assurance Society and Re the Prince of Wales Life Assurance Society Vice-Chancellor Wood
... ... & J. 660; 44 E. R. 1423. See also Johns. 633. Insurance Company. 7 & 8 Vict. c. 110. Policy limiting Liability of Individual Shareholders. Joint Stock Companies ... ...