The Legal Mechanism Of Share Transfer

Based on the study of the nature of shares, the time when share transfer completes and the basis of the doctrine of acquisition in good faith, this dissertation concludes that the doctrine of acquisition in good faith can't be applied to forged share transfer and the shareholder's right to recourse, as the inherent right of property, should be protected by law.Methods of case analysis and comparative analysis are utilized in the research. After analyzing about 20 classical cases, the dissertation gives a good exhibition of the developments and applications of rules governing rights and obligations of the four parties as mentioned above, like company estopped by certificate of shares, shareholder estoppel and implied contract to indemnity and implied warranty by the requester to the company. Through comparative study, the thesis shows that shareholder estoppel and shares acquired in good faith are rules with the same function and the former can help a lot to understand the latter.Besides the parts of introduction and conclusion, the thesis is divided into four chapters. The first chapter denotes three main questions to be resolved by the thesis, that is, the nature of shares, the time when share transfer completes and the basis of the doctrine of acquisition in good faith. Besides it defines the shares to be the interest in the residual assets of the company. The second chapter states the share should be a right in rem based on the division of right in rem and right in personam, which lays the basis for the comparative study of forged share transfer in China and UK since both countries define shares to be right in rem. The third chapter discusses the procedure of share transfer in China and UK and shows that the share transfer is completes when it is registered on the share register since the share register is an instrument to make the share transfer known to the public. Thus, the dissertation suggests the reconstruction of the publicity system of share transfer based on the share register. The fourth chapter discusses the rules in UK to define the right of relative parties in a forged share transfer. Based on the UK's right and obligation analysis, the thesis claims that the basis of the doctrine of acquisition in good faith should be breach of duty which the owner owes to the public that the true owner should not willfully make another person to be publicized as the owner. The conclusion of the dissertation is that when the share transfer is forged, which is obviously not under the will of the shareholder, the doctrine of acquisition in good faith should not be applied and the shareholder should be protected as the owner of the shares based on the inherent right to recourse as the holder of a right in rem. Besides, the thesis makes a critical analysis of relative articles of the judicial interpretation III of the company law of PRC.