losed in the prospectus; otherwise the prospectus
was to be deemed fraudulent. This enactment was repealed by the
Companies Act 1900, but only in favour of more stringent provisions
incorporated in the Consolidation Act of 1908. Now, not only is every
prospectus to be signed and filed with the registrar of Joint Stock
Companies before it can be issued, but the prospectus must set forth a
long and elaborate series of particulars about the company--the
contents of the Memorandum of Association, with the names of the
signatories, the share qualification (if any) of the directors, the
minimum subscription on which the directors may proceed to allotment,
the shares and debentures issued otherwise than for cash, the names and
addresses of the vendors, the amount paid for underwriting the company,
the amount of preliminary expenses, of promotion money (if any), and the
interest (if any) of every director in the promotion or in property to
be acquired by the company. Neglect of this statutory duty of disclosure
will expose directors to personal liability. For false or fraudulent
statements--as distinguished from non-disclosure--in a prospectus
directors are liable in an action of deceit or under the Directors'
Liability Act 1890, now incorporated in the act of 1908. This act was
passed to meet the decision of the House of Lords in _Peek_ v. _Derry_
(12 A. C. 337), that a director could not be made liable in an action of
deceit for an untrue statement in a prospectus, unless the plaintiff
could prove that the director had made the untrue statement
fraudulently. The Directors' Liability Act enacted in substance that
when once a prospectus is proved to contain a material statement of fact
which is untrue, the persons responsible for the prospectus are to be
liable to pay compensation to any one who has subscribed on the faith of
the prospectus, unless they can prove that they had reasonable ground to
believe, and did in fact believe, the statement to be true. Actions
under this act have been rare, but their rarity may be due to the act
having had the effect of making directors more careful in their
statements.

Allotment of shares.

Before the passing of the Companies Act 1900, it was a matter for
directors' discretion on what subscription they should go to allotment.
They often did so on a scandalously inadequate subscription. To remedy
this abuse the Companies Act 1900 (Companies (Consolidation) Act 1908,
s. 85) provided t