Salomon v Salomon & Co Ltd: Difference between revisions

Lord MacNaghten: “For such a catastrophe as has occurred in this case some would blame the law that allows the creation of a [[floating charge]]. But a {{tag|floating charge}} is too convenient a form of {{tag|security}} to be lightly abolished. I have long thought, and I believe some of your Lordships also think, that the ordinary trade creditors of a trading company ought to have a preferential claim on the assets in liquidation in respect of debts incurred within a certain limited time before the winding-up. But that is not the law at present. Everybody knows that when there is a winding-up debenture-holders generally step in and sweep off everything; and a great scandal it is.”

*[[Salomon Brothers]]