Registered Valuers, and Removal of a Company's Name from the Register

In one line

Every valuation required under the Act must be made by a registered valuer appointed by the audit committee or the Board, impartially and without interest in the asset for three years either side; and the Registrar may strike a defunct company's name off the register, on his own notice or on the company's application, whereupon it stands dissolved, though the liability of its officers and members continues and the Tribunal may restore it.

In exam wording: section 247 is valuation by registered valuers; section 248 the Registrar's power to remove a name, section 251 a fraudulent application, and section 252 the appeal and restoration.

Why the law has this at all

The valuer first. A great deal of this Act turns on what something is worth. A scheme of arrangement, a merger's share exchange ratio, a squeeze-out of the minority, a non-cash transaction with a director, a liquidator's first report: each depends on a number, and the person who most wants the number to come out a particular way is usually the person choosing the valuer. Section 247 answers that by requiring a registered valuer, appointing him through the audit committee rather than management, and disqualifying him where he has an interest in the asset for three years before or after the valuation.

The removal of names next. Most companies on the register are not trading. They were incorporated for a venture that never began or has long ended, and they file nothing. Winding them up through the Tribunal would cost far more than they are worth, and leaving them on the register makes the register a lie. Section 248 gives the Registrar an administrative route to dissolution, and sections 250 to 252 supply the safeguards: liability survives, a fraudulent application is punished as fraud, and the Tribunal may restore the name.

Some words this chapter uses

A registered valuer is a person having the prescribed qualifications and experience, registered as a valuer and a member of a recognised organisation. A dormant company is one that has obtained that status under section 455. Struck off means removed from the register of companies. Restoration is putting the name back. Jointly and severally liable means each is liable for the whole.

Valuation by registered valuers: section 247

Section 247(1): when and by whom. Where a valuation is required under the Act of any property, stocks, shares, debentures, securities or goodwill or any other assets, or of the net worth of a company or its liabilities, it shall be valued by a person having such qualifications and experience, registered as a valuer and being a member of an organisation recognised in the prescribed manner and on the prescribed terms, appointed by the audit committee or, in its absence, by the Board of Directors.