Promoter - Definition - Law Dictionary Home Dictionary Definition promoter

Definition :

Promoter, a term anciently sometimes applied to a common informer generally (see 5 Inst. 191), but in modern times applied only to the prosecutor of an ecclesiastical suit, as in Combe v. Edwards, (1878) 3 PD 103.

Those who obtain, or take steps for obtaining, the passing of a private Act of Parliament, to the incorporation of a company under the Companies Acts, are called the promoters. In many respects promoters stand in a fiduciary capacity towards the company which they are engaged in forming, see Twycross v. Grant, (1877) 2 CPD 469; Lagunas Nitrate Co. v. Lagunas Syndicate, (1899) 2 Ch 392, and also OMNIUM; Electric Palace v. Baines, (1914) 1 Ch 532, where the position of promoter vendors was discussed. The promoters usually pay the registration fees, and the company is under no liability to repay them, Re National Motor Co., (1908) 2 Ch 515.

As to the liability of promoters of a company for any untrue statements in the prospectus, see s. 37 of the Companies Act, 1929, and 4th Sch., par. 12, under which the prospectus must disclose the amount paid within the two preceding years or intended to be paid to any promoter and the consideration for any such payment.

See PROSPECTUS; DIRECTOR; MISFEASANCE.

Means the authority, person or co-operative society, as the case may be, by which, or by whom, any multi-storeyed building has been constructed. [Delhi Apartment Ownership Act, 1986 (58 of 1986), s. 3(w)]

Promoter, has been described as follows 'one who promotes, urges one encourages, incites, advances, etc. One promoting a plan by which it is hoped to insure the success of a business, entertainment, etc. venture.

The persons who, for themselves or others, take the preliminary steps to the founding or organisation of a corporation or other venture. Those persons who first associate themselves together for the purpose of organising the company, issuing tits prospectus, procuring subscriptions to the stock, securing a charter, etc., Black's Law Dictionary, 6th Edn.