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Section 661: Liability of others where nominee fails to make payment in respect of shares

Companies Act 2006 · 2006 c. 46View on legislation.gov.uk

Part 18: Acquisition by limited company of its own shares — Chapter 1: General provisions

This section applies where shares in a limited company—

are taken by a subscriber to the memorandum as nominee of the company,
are issued to a nominee of the company, or
are acquired by a nominee of the company, partly paid up, from a third person.

If the nominee, having been called on to pay any amount for the purposes of paying up, or paying any premium on, the shares, fails to pay that amount within 21 days from being called on to do so, then—

in the case of shares that he agreed to take as subscriber to the memorandum, the other subscribers to the memorandum, and
in any other case, the directors of the company when the shares were issued to or acquired by him,

are jointly and severally liable with him to pay that amount.

If in proceedings for the recovery of an amount under subsection (2) it appears to the court that the subscriber or director—

has acted honestly and reasonably, and
having regard to all the circumstances of the case, ought fairly to be relieved from liability,

the court may relieve him, either wholly or in part, from his liability on such terms as the court thinks fit.

If a subscriber to a company's memorandum or a director of a company has reason to apprehend that a claim will or might be made for the recovery of any such amount from him—

he may apply to the court for relief, and
the court has the same power to relieve him as it would have had in proceedings for recovery of that amount.

This section does not apply to shares acquired by a nominee of the company when the company has no beneficial interest in the shares.

About this text

This legislation text comes from legislation.gov.uk. Contains public sector information licensed under the Open Government Licence v3.0. These source and reuse terms cover the legislation text, not Remedy's commentary.

Reuse reviewed 21 August 2026 under Open Government Licence v3.0.