Our Practice Note: Notice to complete covers what ready, able and willing means and what the consequences are of serving an invalid notice. Under the heading Serving an invalid notice to complete, it explains that if a notice to complete is invalid the consequences for the party who gave it can be severe. An invalid notice does not give rise to a right to rescind. If the person who gave the notice does not know that it was invalid and purports to rescind, it will be a wrongful repudiation of the contract. The other party can then accept the breach, rescind

A dividend is a type of distribution made by a company to its members. The Companies Act 2006 (CA 2006) governs how a company may make distributions in CA 2006, Pt 23. A distribution will be unlawful if it does not comply with the requirements of CA 2006, Pt 23 and the applicable common law rules as modified by those provisions. If a company makes an unlawful distribution, there are repercussions not only for that company and its directors, but also for the recipient of the distribution. For further information on unlawful distributions, see: • Practice Note: Unlawful distributions • Q&A: What are the consequences of payment of an unlawful dividend? Breach of articles The provisions of CA 2006, Pt 23 are without prejudice to any enactment, or any provision of a company's articles, restricting the sums out of which, or the cases in which, a distribution may be made. A company's articles should be checked

For the purpose of this Q&A we assume that the company in question is a private limited company and that there has been an allotment of shares that was correctly carried out (although not correctly reflected in the returns of allotment or annual returns filed at Companies House). Returns of allotment A limited company is required to file a return of allotment at Companies House within one month of making an allotment of shares (using Form SH01), which must contain certain prescribed information and be accompanied by a statement of capital. If a company makes default in complying with CA 2006, s 555, an offence is committed by every officer of the company who is in default and the penalties on conviction are set out in CA 2006, s 557 – these may include a daily default fine. In the case of default in delivering the return required by CA

For the purpose of this Q&A we assume that the company in question is a private limited company and that there has been an allotment of shares that was correctly carried out (although not correctly reflected in the company's register of allotments or register of members). Incorrect entries in the register For detailed information on a company’s registers, see Practice Notes: Company records—a company's statutory registers and Company records—a company's non-statutory registers. Register of allotments A company is not legally required to keep a register of allotments. However, the Companies Act 2006 (CA 2006) does require a company to register an allotment of shares (in addition to requiring the company to deliver a return of an allotment to Companies House) as soon as practicable and in any event within two months of the date of the allotment. A failure to comply with this requirement to register an allotment is an

We refer you to the following materials which may be of assistance. For guidance on the courts' attitude to non-compliance and seeking relief from sanctions,

Land Registration Rules 2003 (LRR 2003), SI 2003/1417, r 79 provides that an application to record in the register the determination of a registered estate must be accompanied by evidence to satisfy the registrar that the estate has determined. If the registrar is satisfied that the estate has determined, he must close the registered title to the estate and cancel any notice in any other registered title relating to it, save in the circumstance specified in LRR 2003, SI 2003/1417, r 79(3). To close a registered leasehold title on determination

If a private company pays an unlawful dividend, ie a dividend in breach of the requirements set out in Part 23 of the Companies Act 2006 (CA 2006) or the common law, there are repercussions not only for that company and its directors, but also for the recipient of the dividend. In addition to being unlawful, a dividend may also be paid in breach of the company’s articles of association or any shareholders’ agreement, which would give rise to a breach of contract. A consideration of the consequences of such a breach is outside the scope of this Q&A. The principle underlying the rules relating to the proper payment of dividends is the protection of the shareholders and creditors of the paying company, therefore many of the consequences of an unlawful dividend relate to recovery of the amount paid out. Consequences of an unlawful dividend—paying company A unlawful dividend that is paid remains unlawful. It cannot retrospectively be made lawful. The directors of a company who are party to the payment

Special notice of 28 clear days (ie excluding the day on which notice is given and the day of the general meeting) of a proposed ordinary resolution to remove a director is required to be given to the company (Companies Act 2006 (CA 2006), s 168(2))—28 clear days is not required to be given to the director who is the subject of the proposed

As explained in Practice Note: Stamp duty on transfers—consideration and calculation, an instrument transferring stock or marketable securities, such as a stock transfer form, is chargeable to UK stamp duty unless an exemption or relief applies. The rate of duty is 0.5% of the value or amount of the consideration for the transfer (rounded up to the nearest multiple of £5). The rules determining what constitutes consideration and how to value that for stamp duty purposes are

What is a negative pledge? A negative pledge is a contractual undertaking which prohibits or restricts the party granting the undertaking from creating encumbrances over its assets. In lending transactions, a negative pledge is commonly given by the borrower to the lender and it is often one of the most important negative undertakings in a facility agreement. Negative pledge clauses are primarily intended to ensure that: • an unsecured lender will continue to rank pari passu with all other unsecured creditors of the borrower with all assets of the borrower available for distribution if there are no secured creditors • in syndicated loans, different lenders of the same class will continue to rank equally, and • the borrower is prevented from incurring excessive liabilities (by restricting the amount of security a borrower can create, the lender can indirectly restrict the amount of debt it can incur) For information about negative pledges, see Practice Note: Negative pledges. Why might a company grant security

For information on costs orders generally, see Practice Note: Costs in the employment tribunal. Except in the case where a tribunal makes a costs order with the amount to be paid to be determined by way of detailed assessment, any of the types of costs order once made, will be ‘a judgment or order for the payment of an amount of money’ within the meaning of rule 66 of the ET Rules. It follows that: • if the tribunal, in the wording of its costs order, specifies a date by which the costs must be paid, that will be the date by which the paying party must comply, but • if the tribunal does not specify a date by which the costs must be paid in the wording of its order, then the default period under rule 66 will apply, ie the costs must be paid within 14 days of the date of the judgment or order See

Solicitor acting outside authority If a solicitor does not have authority from their client: • they will be unable to charge their client costs for work done, and • their unauthorised acts will not bind their client to third persons unless those acts are within their ostensible authority For more information, see Commentary: Limits of solicitor's authority: Halsbury's Laws of England [584]. A solicitor holds themself out to their clients as having adequate skill and knowledge to properly conduct the business they undertake and they owe a duty to their client in contract and tort. Accordingly, if they fall below that professional standard they may be liable in negligence, and where that