Q4- Doctrine of Constructive Notice

Updated: Dec 16, 2020

Doctrine of Constructive Notice

The memorandum and articles of association of every company are registered with the Registrar of Companies. The office of the Registrar is a public office and consequently the memorandum and articles become public documents. They are open and accessible to all. It is therefore, the duty of every person dealing with a company to inspect its public documents and make sure that his contract is in conformity with their provisions. But whether a person actually reads them or not, “he is to be in the same position as if he had read them”. He will be presumed to know the contents of those documents. Another effect of this rule is that a person dealing with the company is “taken not only to have read those documents but to have understood them according to their proper meaning”. He is presumed to have understood not merely the company’s powers but also those of its officers. Further, there is a constructive notice not merely of the memorandum and articles, but also of all the documents, such as special resolutions [S. 117] and particulars of charges [S. 77] which are required by the Act to be registered with the Registrar. But there is no notice of documents which are filed only for the sake of record, such as returns and accounts. According to Palmer, the principle applies only to the documents which affect the powers of the company. The common law doctrine of constructive notice should apply to the form. To reiterate the form is a public document which contains particulars of directors who are the mind and will of a company, as well as managers and secretaries who are responsible for the day to day running of the company. It is a document which affects the powers of the company and its agents. Certainly, its purpose must be more than just to provide information about the company’s directors, managers and secretary. Therefore, persons dealing with company should check with the Registrar of Companies who its directors, mangers and secretaries are at given time.

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