Partly paid
A partly paid share in a company is one where only a partial payment (or deposit) has been made, with the expectation that as the company requires more fund, calls are made one a time until the shares are fully paid and the calls cease.
Calls
The schedule of calls may be fixed in the company's original prospectus or it may be at the discretion of the directors.
If the company is a Limited Liability one, the legal requirement to pay calls only ceases when the shares are fully paid.
Example
- Three large shareholders of the stillborn Moreton Bay Tramway Company were taken to the Supreme Court of Queensland over a large amount of unpaid calls, need to tidy up outstanding company debts.[1]
Insurance Companies
Insurance companies sometimes issued partly paid shares on the understanding that a call for the unpaid amount would only be made if the company was in default of its liabilities.
Alternatively, the liability of the shareholders might be limited to say twice the share value in case of a default.
See also
- No liability - for mining exploration companies in Australia.
References
- ↑ "QUEENSLAND.". The Mercury (Hobart, Tas. : 1860 - 1954) (Hobart, Tas.: National Library of Australia). 29 March 1865. p. 3. Retrieved 8 September 2012.