Part 17A company’s share capital
Chapter 10Reduction of share capital
Effect of reduction of capital
652Liability of members following reduction of capital
1
Where a company’s share capital is reduced a member of the company (past or present) is not liable in respect of any share to any call or contribution exceeding in amount the difference (if any) between—
a
the nominal amount of the share as notified to the registrar in the statement of capital delivered under section 644 or 649, and
b
the amount paid on the share or the reduced amount (if any) which is deemed to have been paid on it, as the case may be.
2
This is subject to section 653 (liability to creditor in case of omission from list).
3
Nothing in this section affects the rights of the contributories among themselves.
653Liability to creditor in case of omission from list of creditors
1
This section applies where, in the case of a reduction of capital confirmed by the court—
a
a creditor entitled to object to the reduction of share capital is by reason of his ignorance—
i
of the proceedings for reduction of share capital, or
ii
of their nature and effect with respect to his debt or claim,
not entered on the list of creditors, and
b
after the reduction of capital the company is unable to pay the amount of his debt or claim.
2
Every person who was a member of the company at the date on which the resolution for reducing capital took effect under section 649(3) is liable to contribute for the payment of the debt or claim an amount not exceeding that which he would have been liable to contribute if the company had commenced to be wound up on the day before that date.
3
If the company is wound up, the court on the application of the creditor in question, and proof of ignorance as mentioned in subsection (1)(a), may if it thinks fit—
a
settle accordingly a list of persons liable to contribute under this section, and
b
make and enforce calls and orders on them as if they were ordinary contributories in a winding up.
4
The reference in subsection (1)(b) to a company being unable to pay the amount of a debt or claim has the same meaning as in section 123 of the Insolvency Act 1986 (c. 45) or Article 103 of the Insolvency (Northern Ireland) Order 1989 (S.I. 1989/2405 (N.I. 19)).