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procedure, and dispensed with the old burdensome system in the 1844 Act. 122 The
company could be formed through the registration of the constitutional documents 123
and payment of the registration fees, upon which the certificate of incorporation was
issued, and thereupon the company can commence its business. 124
At the end of the nineteenth century, concerns over liability for misleading
statements in companies‟ prospectuses arose and the law at the time was modified to
impose liability on those responsible for making such statements, including the
directors. 125 During this time, the law had shifted towards the regulatory approach in
order to exercise control over the company. 126 Nevertheless, the introduction, in the
Companies (Consolidation) Act 1908, of private companies which did not require the
company to file its balance sheet and annual return so as to be more attractive to the
public, indicated that the laissez faire doctrine was still very important. 127
The tendency of company law to adopt the regulatory approach became more
apparent during the times of economic slowdown which saw many companies come
apart. This can be seen, for example, in the introduction of the Companies Act 1896
due to the collapse of the economy in Victoria. The Companies Act 1896 focussed
on regulating the company and was a reversal of the laissez faire principle evident in
existing company legislation. 128 The departure from the laissez faire principle was
intended to control the company and to prevent the same occurrences in the future.
122 Ibid.
123 The company needs to register memorandum of association together with articles of association (if
any) with the Registrars as well as any other documents prescribed by the Companies legislation,
upon which, the Registrar will issue certificate of incorporation certified under his hand and seal.
124 Schmitthoff Palmer’s Company Law above n39 at 10.
125 Ibid, at 12.
126 Ibid.
127 Ibid.
128 John Waugh “Company Law and the Crash of the 1890s in Victoria” (1992) 15 UNSWLJ 356 at
382 [“Company Law and the Crash”].
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