The Gazette 1987

GAZETTE

SEPTEMBER 1987

tion of the law relating to directors, and his analysis of the complex protections afforded under Irish law to shareholders, graphically if inaccurately termed "minority pro- t ec t i on". Many of the cases on section 205 of the Companies Act 1963 are distinguished by a strange judicial reluctance to refer to previous Irish authority, and conse- quently give the impression of con- stituting not so much a wilderness of single instances, as a series of judicial applications of "visceral ad h o c e r y " . Every s t udent ap- preciates that there is some rela- tion between the section 205 cases and the evolving attitude of the courts to the way in which directors exercise their fiduciary and common law duties. Ussher however takes this perception to its logical conclusion. His exposi- tion of the Irish case-law on Sec- tion 205 and 213 (f) of the Companies Act, 1963, his discus- sion of the alteration of individual and class rights is expressly based upon, and is ordered by his ap- preciation of the legal and commer- cial change in the role of the company director in Ireland. Ussher forces us to review our apprecia- tion of the S. 205 cases as con- stituting not so much disorder, as an evolutionary process whereby more is judicially expected from company directors. These t wo chapters point the reader not only to a critical evalua- tion of the fraudulent trading cases, but to a vantage point where many of the features of the 1987 Companies Bill appear not only to punish the rogue, but to deter the prudent — not perhaps the most encouraging prospect for Irish industry. Constraints of space on the reviewer, rather than lack of merit on the part of the work reviewed, preclude f u r t her specific encomium. The only criticisms I offer, relate to the overall balance of the text. Two specific instances come to mind in chapter four and chapter sixteen. First, in his discussion of the law on ultra vires Ussher is, I think, right to disagree with Keane J.'s decision in Northern Bank Finance Corporation v Quinn & Achates In- vestment Co., but since the arguments for and against the

decision depend on whe t her statutory protection is afforded to those ignorant of the memorandum or, on the other hand, of the true effect of the memorandum, the discussion could have been briefer. This case is cited and discussed at least ten times, but Ussher's own criticisms of the decision force one to question that decision's correct- ness. Mr. Justice Keane, like a great author, may have nodded — but Dr. Ussher may have shaken his head too forcefully albeit in the other direction. The whole sorry saga of the con- flict between section 8 of the Com- panies Act, 1963, and section 6 of S.I. 163 of 1973 could also have been treated more summarily. As Ussher himself says, this is a legislative blunder. Is his extensive discussion worth-while, in the light of prospective legislative moves in England, which, if adopted, will mitigate the most reprehensible ex- cesses of the ultra vires doctrine? Doub t l ess, legislative moves elsewhere will be followed by the Oireachtas — w i t h its customary rapidity. On the other hand, the im- plications of English decisions in this area, in particular that of the Court of Appeal in Rolled Steel Pro- ducts v British Steel Corporation merit fuller treatment on grounds of the practical importance of its commercial implications. Secondly, the discussion of li- quidation is uneven. Ussher's ac- count of t he p r ac t i ce and procedure of the different kinds of liquidation is, with respect, insuf- ficiently detailed, by comparison with his review of the law relating to fraudulent preference and fraudulent trading. These are inconsiderable, in comparison to the book's worth. No doubt the next edition will en- capsulate the provisions of the 1986 Act and any subsequent legislation. Ussher writes with considerable elegance and precision. He argues with force, dexterity and conviction. His practical experience as a banister and law don has in no way dimmed the vigour of his enthusiasm. His book is a model of what a good law treatise should be, since it conveys a clear and convincing picture ac- curately, relates the law to the society which engenders and is served by it; and is critical, con- structive and imaginative. It refers

BOOK REVIEW Patrick Ussher. Company Law In Ireland. London, Sweat & Max- well, 1 9 8 6. xlvii & 5 77 pp. Price l r £21 . 79. In the past t wo years, the lot of the Irish student of company law has changed for the better. Where formerly, no reliable Irish text-book on the subject existed, now four text-books, and t wo case-books on the subject not only foster access to essential i n f o rma t i on, but stimulate critical and comparative analysis of the law. The search is no longer for quantity but quality. This book, like Mr. Justice Ronan Keane's Company Law in The Republic of Ireland. Butterworth's, London, 1985, is a summary of ex- emplary comprehensiveness and lucidity — quantity and quality combined. Dr. Ussher's book provides a fuller but by no means less elegant synthesis of the subject, than all its rivals, but it must be conceded that Ussher's work goes well beyond them in other directions. It is not only a full and scholarly portrayal of the " s t a te of the a r t ", but also a book in which the depth of analysis of the Irish cases is mat- ched by the range of disciplined and practical, if speculative con- sideration accorded to legislative provisions, proposals for reform, and academic authority originating in this jurisdiction and elsewhere. The non-lawyer will see one fur- ther merit to this book, that may at first escape the occluded vision of the specialist company lawyer. The book offers, at a sophisticated level, a thoughtful analysis of the role and method of legal interven- tion in the area of company law. It is no dry treatise on Irish law, but an insight into the effect on prac- tice, in the "real wo r l d ", of the theory behind the Irish law. It is a book wh i ch has elicited con- siderable praise from professional economists with a legal training. Of the strikingly good chapters of this book, the ones on company capital and corporate borrowing, are particularly clear and com- prehensive. But to show how in- tellectually well-ordered the book is, take t wo contiguous chapters. Consider how Ussher deals wi th the relationship between the evolu-

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