He is a member of the company, and whether he votes with the majority or the minority he is entitled to have his vote recorded—an individual right in respect of which he has a right to sue. [His Lordship then reviewed the several articles of association, which shewed that a member of this company meant a person whose name was on the register of shareholders, and that the title of any member to vote could only be found out by reference to the register. Case Brief Case Name: Pender v Lushington Citation: (1877) 6 Ch D I think the applicants are entitled to the order they ask, which is subject to further order. It says: “Member means member for the time being of the company,” that is, member means member. A meeting could be called, and, if the Court was satisfied that the majority would direct an action to be brought, the company's name would not be taken away. “That it is expedient to put an end to the present antagonism of this company towards the Anglo-American Telegraph Company and its connections, and to work this company's cable in friendly alliance with their lines; and that a committee of shareholders be appointed to be named by the meeting to confer with the directors as to the best method of giving effect to this resolution, and to report to the shareholders thereon at such time as the meeting shall appoint.”. Surely it must do something in the meantime, and it follows, I think, from that portion of the judgment, that in the meantime the Court ought to grant the injunction to keep things in statu quo . Therefore on that view this is a perfectly good action. That being so, their votes were rejected on this ground: It was said that the persons who gave the votes were trustees for other persons, and that these other persons, the cestuis que trust of those trustees, were also either holders in their own name or as cestuis que trust of other shares, amounting in the whole to more than 1000 shares, so that if all the shares to which the persons were entitled had been registered in one name, that person could not have given more than 100 votes, the 56th section of the articles saying, that every member holding at least ten shares shall have one vote for every complete number of ten shares, with this limit, that no shareholder shall be entitled to more than 100 votes in all. You can only give him notice by referring to the register which, under Article 2, is “to be kept pursuant to the terms of the Companies Act, 1862 .” So that a member is a man who is on the register. I now come to the subordinate question, not very material in the view I take of the case, namely, whether you have the right Plaintiffs here. Pender v Lushington 6 Ch D 70 In the case of Pender, the plaintiff had been denied the voting rights. He may think it more for his particular interest that a certain course may be taken which may be in the opinion of others very adverse to the interests of the company as a whole, but he cannot be restrained from giving his vote in what way he pleases because he is influenced by that motive. It is equally clear, if I am right in the conclusion to which I have come as to the impropriety of the decision of the chairman in rejecting these votes, that it is a case in which the company might properly sue as Plaintiffs to restrain the directors from carrying out a resolution which had not been properly carried, and then comes the question whether I ought or ought not to allow the company now to remain as Plaintiffs. But there is another ground on which the action may be maintained. No doubt they are rights of suing in a distinct character. Pender v Lushington (1877) 6 CH 70 This case set out a general principle that part of a member's property when owning shares was the right to vote. Even if that is not the true meaning of the judgment, and it is not quite so explicit as I could have wished for my guidance, then the only other alternative is that it is a case in which it would be impossible for relief to be obtained by the company bringing an action, and it must be within the exception pointed out in Foss v Harbottle, that the shareholders must have a right to institute an action in the name of one or more, because otherwise it would be impossible to maintain an action at all. Even if that is not the true meaning of the judgment, and it is not quite so explicit as I could have wished for my guidance, then the only other alternative is that it is a case in which it would be impossible for relief to be obtained by the company bringing an action, and it must be within the exception pointed out in Foss v Harbottle, that the shareholders must have a right to institute an action in the name of one or more, because otherwise it would be impossible to maintain an action at all. Mr John Pender had bought 1000 shares. The summons will stand over till the trial or further order, with liberty to either party to call a meeting. Lord Jessel MR held that Pender could have an injunction for his vote to be recorded. Filter Ltd v Cuninghame, Hickman v Kent Sheep-Breeders’ Association, North-West Transportation Co Ltd v Beatty, Isle of Wight Railway Company v Tahourdin, Court of Appeal of England and Wales cases, has a right to say, "Whether I vote in the majority or minority, you shall record my vote, as that is a right of property belonging to my interest in this company, and if you refuse to record my vote I will institute legal proceedings against you to compel you. I object to that modification. As Lord Jessel MR put it, a member: . There is, first, Mr. Pender himself, on behalf of himself; next, as the representative of the class of shareholders who voted with him, whose votes I hold to have been improperly rejected; and, next, there is the Direct United States Cable Company. You can only give him notice by referring to the register which, under Article 2, is “to be kept pursuant to the terms of the Companies Act, 1862 .” So that a member is a man who is on the register. Pender v Lushington (1877) 6 Ch D 70 is a leading case in UK company law, which confirms that a company member's right to vote may not be interfered with, because it is a right of property. I now come to the subordinate question, not very material in the view I take of the case, namely, whether you have the right Plaintiffs here. This article was sourced from Creative Commons Attribution-ShareAlike License; additional terms may apply. Then it is said that there are several rights. [His Lordship then reviewed the several articles of association, which shewed that a member of this company meant a person whose name was on the register of shareholders, and that the title of any member to vote could only be found out by reference to the register. Crowd sourced content that is contributed to World Heritage Encyclopedia is peer reviewed and edited by our editorial staff to ensure quality scholarly research articles. It would be an absolute denial of justice, and it appears to me that the Court of Appeal, in the case of MacDougall v Gardiner,[2] have deliberately adopted that view of the matter, as I read the following observations of Lord Justice James: “Any one of the shareholders might have filed his bill in the name of the company, and then, if the directors had said, ‘You are not the company; the majority do not act with you, but with us,’ the Court would, as it has done in other cases, have taken the means of ascertaining which party it is, the Plaintiff's or the Defendant's, which really represents the majority of the company.” I suppose he means that the Court may direct a meeting to be called. If it means that a man may hold 1000 shares beneficially, or that a man may disunite his shares, then there is no reason why he should be disqualified because he has one share in his own name or ten shares in his own name. I only grant that until further order. To that question I am now going to address myself. Eley should be a permanent company’s solicitor as stated in the articles Appoint other solicitor instead of Eley. I cannot deprive him of his property, although he may not make use of that right of property in a way I might altogether approve. Pender v LushingtonThis case is about the right to vote and the right to havethe vote to be counted were personal right given tomember. As Lord Jessel MR put it, a member. Now the argument is, that the words “every member” mean, not a man registered on the list of shareholders, but any person beneficially entitled to shares, because if not carried to that extent I do not understand the argument at all. Those are the propositions with which I must deal. He then continued:—]. He may think it more for his particular interest that a certain course may be taken which may be in the opinion of others very adverse to the interests of the company as a whole, but he cannot be restrained from giving his vote in what way he pleases because he is influenced by that motive.