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GAZETTE
SEPTEMBER 1987
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-
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
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