New Clause 84
Company Law Reform Bill [Lords]
Public companies: effect of irregular allotment where issue not fully subscribed
‘(1) An allotment made by a public company to an applicant in contravention of section (Public companies: allotment where issue not fully subscribed) (public companies: allotment where issue not fully subscribed) is voidable at the instance of the applicant within one month after the date of the allotment, and not later.
(2) It is so voidable even if the company is in the course of being wound up.
(3) A director of a public company who knowingly contravenes, or permits or authorises the contravention of, any provision of section (Public companies: allotment where issue not fully subscribed) with respect to allotment is liable to compensate the company and the allottee respectively for any loss, damages, costs or expenses that the company or allottee may have sustained or incurred by the contravention.
(4) Proceedings to recover any such loss, damages, costs or expenses may not be brought more than two years after the date of the allotment.’.—[Margaret Hodge.]