Section 54 - Canons of construction of class rights

In construing the provisions of the constitution of a company in respect of the rights attached to shares, the following canons of construction shall be observed:

(a) unless the contrary intention appears, a dividend is not payable on any shares unless the company resolves to declare that dividend;

(b) unless the contrary intention appears, a fixed preferential dividend payable on a class of shares shall be cumulative; in other words, a dividend is not payable on any shares ranking subsequent to that class of shares until all the arrears of the fixed dividend have been paid;

(c) unless the contrary intention appears, in a winding up, arrears of a cumulative preferential dividend whether or not earned or declared is payable up to the date of actual payment in the winding up;

(d) if a class of shares is expressed to have a right to a preferential dividend, then, unless the contrary intention appears, that class does not have a further right to participate in dividends;

(e) if a class of shares is expressed to have preferential rights to payment out of the assets of the company in the event of winding up, unless the contrary intention appears, that class does not have a further right to participate in the distribution of assets in the winding up;

(f) in determining the rights of the various classes to share in the distribution of the property of the company on a winding up, consideration shall not be given unless the contrary intention appears, to whether or not the property represents accumulated profits or surplus which would have been available for dividend while the company remained a going concern; and

(g) subject to this section, the shares rank equally in all respects unless the contrary intention appears.