Another contribution from sidelined Observer:
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Section 231: some doubt remains
Section 231 of the Corporations Act says, in effect, that a person must agree to become a member of a company.
What this involves has been the subject of debate.
At first instance, the court concluded that, as the unit holders had agreed to be bound by a constitution that gave Wellington the power to distribute shares to the unit holders, their agreement to become shareholders of the company was imputed, satisfying the s231 requirement.
The High Court said that, since the necessary power did not exist, no such agreement could be imputed.
In saying this, it seemed to imply that if the necessary power had existed, the imputation would have been
enough to satisfy the s231 requirement.
However, it did not state this categorically, and so some doubt remains.
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Pump some more air into those floaties, PIFers.
Regards,
OCV
octaviar limited
