Louis Doyle KC and Douglas Cochran successful in the Court of Appeal in Re JDK Construction Ltd (in liquidation) on the reliance that can be placed on a company’s register of members following a transfer of shares based on a forged stock transfer form

Louis Doyle KC and Douglas Cochran have been successful on behalf of the respondent liquidators in the Court of Appeal in resisting an appeal against an order of HHJ Hodge KC in the Manchester District Registry. The judgment of the Court of Appeal in Re JDK Construction Limited (in liquidation), Keegan v Bland and Mayo [2024] EWCA Civ 934, handed down on 5 August 2024, concerned an important and unresolved issue as to the reliance that may be placed on entries in a company’s register of members when determining the validity of a written resolution appointing liquidators on the voluntary liquidation of that company. Following argument concerning authorities not before the Court at first instance, including the Supreme Court’s decision in Enviroco Ltd v Farstad Supply A/S [2011] UKSC 16, [2011] 1 WLR 921, the Court of Appeal (Snowden LJ, King and Asplin LJJ agreeing) upheld the decision at first instance, albeit on rather different grounds. Even on the footing that a stock transfer form is a forgery, the register of members maintained under s.112 of the Companies Act 2006 is conclusive as to the identity of the members of a company at any particular point in time, so that a written resolution based on the content of the register, even allowing for a forged share transfer form, is valid and effective. The decision in Re JDK Construction is good news for those who regularly rely upon a company’s register of members, most obviously those licensed insolvency practitioners considering taking appointment in a voluntary liquidation.