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The present work is the result of an attempt to in- 
vestigate the Law of Companies considered as a branch 
of the Law of Partnership. 

The Statutory Law of Partnership was long in a state 
of transition ; but this state may be said to have termi- 
nated when the Companies act, 1862, was passed, con- 
solidating, repealing and amending most of the statutes 
then in force relating to Joint-Stock Companies. The 
Law of Companies has so developed since that time that 
it has become desirable to devote a separate volume to 
it instead of including it in a treatise on the Law of 
Partnership as in former editions. 

The Companies acts, 1862 to 1886, and the rules 
promulgated under their provisions are printed in an 
appendix ; and, to facilitate reference to them, a 
separate index to their sections and clauses is inserted 
immediately before the general index, with which the 
work concludes. 

It must always be borne in mind, that in order to 
determine any legal question relating to companies, it is 
indispensable to attend closely to the language of the 
statutes by which they are governed ; and although for 
convenience, the substance of various statutory enact- 



ments has been shortly stated in the text, the reader is 
warned not to rely on these abridgments, but to consult 
the statutes themselves in every case which he may have 
to investigate. 

Great pains have been taken to render this Edition 
deserving of the favourable reception accorded to those 
which have preceded it. The separation of the matter 
in this treatise from that in the volume on Partnership 
already published has rendered it necessary to recast 
the whole work. The former arrangement has been 
followed in the main; but those portions which relate 
to Fraudulent Prospectuses, Borrowing Money, the 
Duties of Promoters, Transfers in blank, Forged 
Transfers, the amalgamation and reconstruction of 
Companies and Building Societies, have been so de- 
veloped as to be practically new. Other portions, 
especially that relating to Contributories, have been 
rearranged and rewritten. The whole treatise has, in 
short, been carefully revised throughout, and adapted 
to the most recent decisions. 

Notwithstanding, however, the labour bestowed upon 
the work, and the anxiety of the author to render it 
worthy of the profession to which he has the honour to 
belong, the multiplicity and difficulty of the questions 
with which he has had to deal are such, that he dare 
not venture to hope that he has always avoided error, 
or that his work is free from serious faults : and 
although it has engaged his unremitting attention for 
more than thirty years, he is painfully aware that it 
is even now but an imperfect production. 


It only remains to add that this Edition has been 
prepared by the author and his son, Mr. W. B. Lindley, 
and Mr. W. C. Gull. They have not only revised 
the sheets, but have examined the decisions on all 
the most difficult subjects, recast some of the portions 
which are new, made new indexes, and have thus 
greatly diminished the author's labours and contributed 
to the utility of the work. 

Royal Courts of Justice, 
June, 1889. 



Preface v 

Authorities Cited xxi 

Abbreviations lxxiv 

Additions and Corrections lxxv 

Introductory l 

Book I. — Of the Formation of Companies and of the Allotment of 

Shares 11 

Book II. — Of the Rights and Obligations of Companies as regards 

Non-Members 143 

Book III. — Of the Rights and Obligations of Members of Com- 
panies between themselves 298 

Book IV. — Of the Dissolution and Winding-up of Companies . . 608 

Appendix 909 

Indexes 1111 


1 . Nature of a company 1 

2. Historical sketch of the law relating to companies 2 

3. Different sorts of companies 7 




General observations ...... ..11 

CHAP. I. — Agreements to take Shares. 

Sect. 1. — Applications for and allotment of shares . . . .13 



Sect. 2. — Of the prospectus and departures from it . . .19 

[As to fraudulent prospectuses, see infra, Ch. III.] 

Sect. 3. — Of the return of subscriptions to companies on the ground of 

failure of consideration 29 

[As to fraud, see infra, Ch. III.] 

CHAP. II.— Of Membership. 

Sect. 1. — Who can be members 36 

and herein of 

1. Aliens 36 

2. Convicts 38 

3. Infants 39 

4. Lunatics .......... 40 

5. Married women 41 

6. Corporations and companies 43 

Sect. 2. — What constitutes membership 43 

and herein of membership by estoppel 

1. As between the company and an alleged shareholder . 49 

2. As between an alleged shareholder and a creditor . . 54 
Sect. 3. — Of registers of shareholders and certificates of title to shares, 

and herein of the correction of registers. ... 57 
Sect. 4. — Of scrip 65 

CHAP. III. — Of Membership induced by False Statements. 

Sect. 1. — Effect of false statements apart from statute . . . . 68 

1. Recpxisites for redress ....... 68 

2. Remedy against the company 74 

3. Remedy against the individuals who made the state- 


criminal 87 

civil 88 

Sect. 2.— Statutory enactments, 30 & 31 Vict. c. 131, § 38 . . 91 

CHAP. IV. — Of Different Classes of Companies. 

Class I. Cost-book mining companies] . . . ..93 
Class II. Companies incorporated or privileged by the 
crown, viz. : — 

1. Chartered companies .... 97 

2. Companies formed under the Letters 

patent act, 7.Wm. 4 & 1 Vict. c. 73 . 99 
Class III. — Companies incorporated or privileged by some 
special act of Parliament : — 

1. Companies not incorporated, but, em- 

powered to sue and be sued . . . 101 

2. Incorporated companies . . . 102 



Class IV. Companies incorporated or privileged by a 
general act of Parliament : — 

1. Banking companies formed under 

7 Geo. 4, c. 46 . . . . 109 

2. Registered companies . . . . Ill 

1. Companies formed and registered 

under the Companies act, 1862 . 117 

2. Companies registered under the 

Companies act, 1862, but not 
formed under it . . . . 1 26 

CHAP. V.— Of Illegal Companies. 

Sect. 1. — What companies are illegal 130 

note on the Bubble act of 1719 (6 Geo. 1, c. 18) . . 130 

Sect. 2. Consequences of illegality 1 39 




CHAP. I. — General Principles of Agency as applied to Companies 


Sect. 1. — Of the liabilities of promoters and subscribers for the acts of 

each other 143 

Sect. 2. — Of the liabilities of companies for the acts of their promoters 146 

CHAP. II. — General Principles of Agency as applied to Companies 


Sect. 1. — Who are agents 

1. Directors 155 

2. Agents who are not directors 159 


Sect. 2. — Authority of agents of companies 

1. Of acts which are ultra vires . .... 

2. Of acts which axcintra vires but irregular 

3. Of imperative and directory clauses in companies 

statutes and regulations ....■• 

Sect. 3. — Of ratification by companies . 




CHAP. III. — Of the Liabilities of Companies for the Acts of their 
Agents in Particular Cases. 

Sect. 1. — Cases not involving any tort or fraud and herein of 

Admissions 183 

Amalgamation . 183 

Arbitration 184 

Bills of exchange and promissory notes . . . . 185 

Bill in Parliament 186 

Bonds 186 

Borrowing money .186 

Cheques 196 

Compromises .196 

Debentures 196 

Deeds 198 

Extension of business 199 

Indemnity 200 

Insurance 201 

Investments and loans 201 

Judicial proceedings ........ 201 

Leases 201 

Mortgages and pledges 202 

Notice 204 

Purchases 205 

Representations 206 

Sales 207 

Transfer of business 208 

Sect. 2.— Torts 208 

Sect. 3.— Frauds 211 

CHAP. IV. — Of the proper Form of Contracts with Companies and 


Sect. 1. — Of the rule requiring contracts of corporations to be under 

seal 221 

Sect. 2. — Statutory exceptions to the foregoing rule . . . . 225 

Sect. 3. — Bills of exchange and promissory notes .... 230 

CHAP. V. — Liability of Companies in respect of Contracts not 
Binding on them but of which they have had 
the Benefit 235 



CHAP. VI.— Of the Liability op Individual Members of Companies 
to Creditors. 
Sect. 1. — Of the liabilities of directors 

1. For their own acts 239 

2. For the acts of each other 244 

Sect. 2. — Of the liabilities of shareholders 

1. As to the extent of liability 245 

a) of liability at common law and of attempts to 

restrict it . . . . . . . . 245 

b) of limited liability by statute 251 

2. As to the duration of liability 

a) commencement of liability 254 

b) termination of liability 255 

3. On the commencement and termination of liability in 

the case of amalgamating companies . . . . 258 

CHAP. VII. — Of Actions between Companies and Non-Members. 
Sect. 1. — Of actions by and against companies 

1. Incorporated companies ...... 262 

2. Companies empowered to sue and be sued by public 

officers ••...... 265 

3. Other unincorporated companies 270 

Sect. 2. — Of set-off by and against companies .... 273 
Sect. 3. — Of execution against companies and shareholders on judg- 
ments against their companies 276 

1. Execution against the company ..... 278 

2. Proceedings against shareholders upon a judgment 

obtained against a company or its public officer 
generally 280 

3. Proceedings against members of particular companies 


a) 7 Geo. 4, c. 46 285 

6) 7 Wm. 4 & 1 Vict. c. 73 289 

c) 8 & 9 Vict. c. 16 290 

d) other companies ...... 293 

Note on procedure by scire facias 294 





CHAP. I. — Op the Right to take Part in the Management of 
Companies' Affairs. 

Sect. 1. — Of directors and their powers 298 

Sect. 2. — Of shareholders and their powers 303 

Sect. 3. — Of the powers of majorities 314 

Sect. 4. — Of the constitution and management of particular companies 

1. Cost-book mining companies 325 

2. Companies governed by 8 & 9 Vict. c. 16 . . 327 

3. Companies governed by the Companies act, 1862 . . 333 

CHAP. II. — Of the Fiduciary Relation of Promoters and Directors 


Sect. 1. — Of promoters 345 

Sect. 2. — Of directors and of their position as trustees . . . 363 

Sect. 3. — Of the right of directors and others to indemnity . . . 379 

CHAP. III. — Of the Capital of Companies ; of Calls ; of Dividends ; 

and of Accounts. 

Sect. 1. — General observations on the capital of companies . . . 391 

1. Borrowed capital 391 

2. Share capital 392 

varying the amount of capital 392 

the division of capital into shares .... 393 

nominal and paid-up capital 394 

preferential capital 396 

increasing capital 397 

3. Statutory enactments relating to the capitals of 

particular kinds of companies 

the Companies clauses acts ..... 399 

the Companies act, 1862 401 

Reduction of capital 402 

Sect. 2. — Of calls 407 

1. The persons by whom calls can be made . . . 408 

2. The purposes for which they can be made . . . 409 

for starting the company 409 

for carrying on the business of the company . . . 411 



3. The manner of making calls 414 

the resolution making a call . . . . .415 

the notice that a call has been made . . . . 417 

4. The persons liable to pay calls 419 

subscribers 420 

shareholders 420 

representatives of subscribers and shareholders . . 425 

5. Actions for calls 427 

Sect. 3.— Of dividends 429 

payment of dividends out of capital . . .431 

rights of preference shareholders 435 

actions for ........ 437 

in particular companies 437 

Sect. 4. — Of accounts 

1. Of the duty to keep and the right to inspect them . 439 

2. Of false and fraudulent accounts 446 

CHAP. IV.— Of Shares in Companies ; their Transfer and Sale. 

Sect. 1. — Of the nature of a share 449 

Sect. 2. — Of the amount of a share ....... 455 

Sect. 3. — Of a company's lien on the shares of its members . . . 456 

Sect. 4. — Of charging orders on shares ...... 460 

Sect. 5. — Of the transfer of shares 464 

1. Of ordinary transfers ....... 464 

2. Of transfers in blank 471 

3. Of forged transfers 483 

and herein of estoppel by carelessness . . . . 486 
[as to transfers on death and bankruptcy, see infra, 
Ch. VII. and VIII.] 

Sect. 6. — Of sales of shares, and questions arising thereon . . . 487 

1. Sales not on Stock Exchange 491 

vendor's obligations . . . . ... 491 

purchaser's obligations 492 

fraudulent sales 496 

sales by auction 497 

actions between buyer and seller . . . . 498 

2. Sales on Stock Exchange 500 

1. Of the vendor and of the broker or jobber 

who agrees to buy from him .... 503 

2. Of the vendor and the ultimate purchaser . . 505 

3. Of the vendor and undisclosed and inter- 

mediate purchasers 508 

4. Of the vendor and purchaser as regards then- 

respective brokers 511 



CHAP. V. — Op the Surrender of Shares. 

Sect. 1. — Generally 517 

Sect. 2. — In particular companies 523 

CHAP. VI. — Of the Forfeiture of Shares. 

Eight to forfeit 528 

Exercise of the right 532 

Effect of forfeiture 533 

Relief against forfeiture 534 

CHAP. VII. — Of the Effect of the Death of a Shareholder. 

Sect. 1. — As between the executors and the company . . . . 536 

Sect. 2. — As between the creditors of the company and the executors . 539 

Sect. 3. — As regards the separate creditors and legatees of the deceased 540 

CHAP. VIII. — Of the Effect of the Bankruptcy of a Shareholder 549 

Position of trustee and disclaimer by him . . . 553 

Proof by companies for calls, &c. 554 

CHAP. IX. Of Actions between Companies and their Members 


General observations 559 

Sect. 1. — Of the parties to sue and be sued 562 

1. Actions by and against incorporated companies . . 562 

2. Actions by and against public officers .... 564 

3. Actions by one member on behalf of himself and others 565 

Sect. 2. Of the rule that the court will not interfere in matters of 

internal regulation 574 

Sect. 3, Of the rule that the court will not interfere at the instance 

of persons who have been guilty of laches . . . . 582 

Sect. 4.— Of particular actions . . 585 

1. Specific performance 585 

2. Rescission of contract and return of deposits . . 589 

3. Account and discovery 594 

4. Injunctions 596 

5. Receivers 602 

6. Mandamus 603 

7. Other miscellaneous actions 606 


— » — 



Introductory 608 

CHAP. I. — Winding up by the Codrt. 

Sect. 1. — The Court having jurisdiction over the winding up of the 

Company ......... 615 

Sect. 2. — Companies which can be wound up by the Conrt, or subject 

to its supervision ........ 616 

Sect. 3. — Persons at whose instance a winding-up order will be made 624 

Sect. 4. — Circumstances under which a compulsory winding-up order 

will be made 628 

1. Circumstances under which a winding-up order can 

be made 630 

2. Circumstances influencing the discretion of the Court . 635 

Creditors' petitions ...... 635 

Contributories' petitions 639 

3. Summary of cases 644 

Sect. 5.— Proceedings to obtain a winding-up order and to discharge 

it, and to stay proceedings under it . . . 654 
Appeals from, and staying proceedings under, winding-up 

order 661 

Sect. 6. — Effect of winding up as regards dealings with property, &c . 664 

1. Commencement of winding up 664 

2. Effect of winding Tip on dealings with property . . 666 

3. Effect of winding up on legal proceedings against the 

company and its members . .... 669 
a) As regards companies formed and registered under 

the act of 1862 672 

li) As regards companies not formed under that act . 682 

Sect. 7. — Proceedings under compulsory winding-up orders . . 684 

1. Generally 684 

2. Extraordinary powers of the Court .... 689 

3. Mode of enforcing orders and appeals from them . . 697 

Sect. 8.— The liquidators of the company . . ... ('>!)!) 

1. Provisional liquidators 700 

2. Official liquidators ~° l 

L.C. h 



Sect. 9.— Proof and payment of debts ....... 

1. General observations ....... 

2. Debts provable 

3. Set-off 

Sect. 10. — Of eontributoriea 

1. The list of contributories 

2. Who are contributories 

General observations 

Classification of contributories 

A. Contributories as present members . 

1. Duly constituted shareholders 

As to persons who have not ceased to be members 
but whose shares have been sold, surrendered, 
or forfeited, see infra, under head B. 

2. Persons estopped from denying that they are share- 

holders ....... 

3. Persons who are bound by agreement to become 

shareholders ...... 

4. On the repudiation of shares after the commencement 

of the winding-up .... 

a) no agreement ...... 

b) illegally issued shares .... 

c) fraud ....... 

d) non-performance of conditions 

5. Holders of paid-up shares .... 

6. Directors in respect of their qualification shares 

7. Subscribers of the memorandum of association 

8. Holders of scrip 

9. Trustees and cestuis que trustent 
10 Mortgagees 

11. Persons under disability 

a) companies ...... 

b) married women and their husbands 

c) infants ...... 

d) lunatics ....... 

12. Eepresentatives ...... 

a) executors, &c. ...... 

b) trustees in bankruptcy .... 

B. Contributories as past members 

General observations on past members 
1. Persons who have transferred their shares to others 

a) where the transferee has been accepted by the 

company in the place of the transferor . 

b) where the transferee has not been so accepted 














a) where the sale has taken place before the 

commencement of the winding up . . . 833 

8) where the sale has taken place since the com- 
mencement of the winding up 836 

2. Persons who have surrendered their shares to the com- 

pany 837 

3. Persons whose shares have been forfeited . . . 842 
Sect. 11. — Calls for debts, &c 846 

1. Generally 846 

2. Calls for debts 849 

3. Calls for the adjustment of the rights of the con- 

tributories ......... 852 

4. Limit of liability to calls 

a) present members 853 

b) past members ....... 855 

5. Set-off against calls ........ 857 

Sect. 12. — Costs 859 

1. As to costs payable by the company . . . . 859 

2. As to the payment of those costs . . . . . 864 

Sect. 13. — Distribution of surplus assets and final dissolution of the 

company 867 

Note on Building Societies 871 

CHAP. II.— Of Winding up Voluntarily and subject to the Super- 
vision of the Court. 

Sect. 1. —Differences between the various methods of winding up . . 874 

Sect. 2. — Of winding up voluntarily 875 

Sect. 3. — Of winding up subject to the supervision of the Court . . 886 

CHAP. III.— Of the Amalgamation and Reconstruction of Com- 
panies 891 

CHAP. IV. — On the Abandonment of Railways and the Winding-up 
and Dissolution of Railway Companies. 

1. Abandonment of railways . . . . . . 901 

2. Arrangements between railway companies and their 

creditors . . . . . . . . . 904 

b 2 




1. Foreign Companies 909 

2. Industrial and Provident Societies 915 

3. Benefit Building Societies 918 

4. Chronological List of Statutes 923 

Table of Statutes now in force ........ 931 

5. The Companies acts, 1862—1886 

Companies act, 1862 933 

Companies seals act, 1864 1015 

Companies act, 1867 1017 

Companies arrangement act, 1870 1027 

Companies act, 1877 1028 

„ 1879 1030 

„ „ 1880 1032 

„ 1883 1035 

Companies colonial registers act, 1883 1035 

Companies act, 1886 1037 

6. Orders and Bules — 

Rules of 1862 ... 1041 

1868 1084 

7. Life assurance companies acts — 

Life assurance companies act, 1870 1095 

Do., Amendment act, 1872 1103 


Index to the above Acts and Rules 1111 

General Index . 1145 


[Those pages in which a ease is particularly referred to in the text, and is not 
merely cited, are in the following list denoted by an asterisk. 

The cases in each sheet have been brought down to the latest possible moment. 
It ought, however, to be mentioned, that no attempt has been made to collect cases 
decided since the establishment of the Law Reports, and not reported therein. 

An attempt has been made to collect under the name of each company the cases 
reported in connection with its winding up ; but the references to those cases will be 
found, not under the name of the company, but under the names of the persons to 
whom they relate ; for owing to the way such cases are frequently reported, it has 
been found impossible to make complete lists of them under the names of their 
respective companies. ] 


724, 863, 866 
. 117 

792, 793, 794* 

A'Beckett, ex parte 
Abbott v. Rogers 
Aberaman Iron Works . 

Peek (4 Ch. 532) 
Abercorn's case . 15, 
Aberdeen Railway Co. v. Blaikie 328, 

Abraham v. Hannay . . . 564 
Abrath v. Nortb-Eastern Railway 

Co 210, 216 

Accidental Death Insurance Co., 

(7 Ch. D. 568) . . 251, 866 

Allin (16 Eq. 449) 
Chappell (6 Ch. 902) 
Accidental and Marine Insurance 


Bridger (4 Ch. 266) 
Briton Medical and General 
Life Association (5 Ch. 428; 
Neill (4 Ch. 266) 
Accidental Marine Insurance Co. 
v. Mercati .... 
Acland v. Lewis . . . . 
Adair v. New River Co. 
Adam Eyton, Limited 

Charlesworth (36 Cb. D. 299) 
Adams's case 15, 520, 521, 761, 763, 

769, 770, 839, 842 
Adams v. Great Western Railway 

Co 38, 911 

Adansonia Fibre Co. 

Miles (9 Ch. 635) 
Addams v. Ferrick . . . 544 
Addie v. Western Bank of Scotland 216 
Addinell's case . . . . 16 
Addison's case (5 Ch. 294) *782, 806, 

838, 840 

(20 Eq. 620) . . .853 

Addison v. Mayor of Preston . . 280 
v. Tate . . 295, 296, 297 




Addlestone Linoleum Co. 334, 396, 401, 
736, 742, 754, 787, 789 
Adelphi Hotel Co., Limited 

Best (2 De G. F. & J. 650) 

Adley v. Whitstable Co. 308, 322, 433*, 

580*, 597 

Agar v. Athenreum Life Insurance 

Society . . 165, 168*, 174, 180, 

199, 224 

Aggs v. Nicholson 186, 226*, 234. 

Agra Bank's claim . . . 726 
and Masterman's Bank (ex 

parte (6 Ch. 206) 

175, 708, 
712, 881 
712, 894, 898 

(12 Eq. 509) 

(2 Ch. 391) 

Anderson (3 Eq. 337) 

Cannan (7 Eq. 102) 

Tondeur (5 Eq. 160) 

Waring (W. N. 1866, 399) 
Agricultural Cattle Insurance Co. 

(1 Mac. & G. 170) 

(3 De G. F. k J. 194) 

(10 Ch. 1) . 

Baird (5 Ch. 725) 
Belhaven (3 De G. J. & S. 41) 
Brotherhood (31 Beav. 365) 
Bush (6 Ch. 246) 

Dixon (5 Ch. 79) 
Official Manager (10 Ch. 1) 
Smallcombe (3 Eq. 769) 
Spackman (1 De G. & Sm. 599) 

(1 M. & G. 170) 

Stanhope (1 Ch 161) 
Stewart (1 Ch. 511) 

v. Fitzgerald 

A. G. V. Alexander 
v. Birkbeck . 



. 631 

686, 702 

737, 866 

11'.'. \-2J. 



A. G. r. Ely, Haddenham, and 
Sutton Railway Co. . 

v. Great Eastern Railway Co. 

163, 165, 315, 317, 318, 321 

v. Great Northern Railway 

Co. . 264,319,321,580*, 
v. (iould . . . • 

v. Higgins . 

v. Montefiore . . . 

v. Norwich 

v. Shrewsbury Bridge Co. 



, 597 

Aitchison v. Lee . . • • 613 
Alabaster's case . . . 774, 864 
Albert Average Association . 702 

Blyth and Co. (13 Eq. 529) 
Albert Life Assurance Co. (9 Eq. 

700) . ... 249, 251 

(6 Ch. 381) . . 710, 711*, 712 

Bell (9Eq. 706) 

Bleacklev (9 Eq. 706) 

Cook (9 Eq. 703) 

( Iraig's Executors (9 Eq. 706) 

Kerr and Stubbs (9 Eq. 706) 

Western Life Assurance So- 
ciety (11 Eq. 164) 

Wilson (9 Eq. 706) 
Albion Life Assurance Society 

Brown (18 Ch. D. 639) 

Sanders (20 Ch. D. 403) 

Winstone (12 Ch. D. 239) 
Albion Steel Wire Co. . 

v. Martin . . 349, 362* 

Albrecht v. Sussman . 
Alchorne v. Saville 
Aldborough Hotel Co. 

Simpson (4 Ch. 184) 
Aldebert v. Kearns 

v. Leaf ..... 

Alderson v. Clay 

Aldhani v. Brown . . 32, 33 

Aldred r. North Midland Railway 

Co 150 

Aldridge v. Cato . . . 252, 910 
Alexander's case . . 747*, 826* 

Alexander v. Bearne . 

v. Worraan . . . . 

Alexander Water Co. v. Musgrave 
Alexandra Hall Co. 
Alexandra Palace Co. (16 
D. 58) . 

- (21 Ch. D. 149) 

(23 Ch. D. 297) 

Alexandra Park Co. 

Hart (6 Eq. 512) 
Sharon (W. N. 1866, 231) 
Alison's ease . . . 736, 774, 849 
Alivcn r. Furnival . . . . 910 

Allard v. Bourne . . 160, 205 

Allen v. Graves . . 504, 509, 510 

v. London and South- Western 

Railway Co. . . . 209 
v. Sea, Fire and Life Assur- 
ance Co. . . 185, 226, 234* 
Alliance Bank .... 727 
Alliance Society . . • • 872 
Allin's case ..... 829 

737, S53 

681, 721 

365, 368 


246, 251 


. 708 
265, 714 
375, 432, 696 

Allison v. Herring . . . . 272 
Alma Spinning Co. 

Bottomley (16 Ch. D. 681) 
Almada v. Tirito Co. 334, 396, 401, 783, 

Amazon Life Assurance and Loan 
Blackburn (3 Dr. 409) 

(8 De G. M. & G. 177) 

Hutchinson (25 L. J.) 
Ambergate, &c, Railway Co. v. 

Coulthard . . . .416 

„. Mitchell . 393*, 399, 408, 418 

v. Norcliffe .... 416 

Ambrose Lake Tin Mining Co. 369*, 695 
Clarke (8 Ch. D. 635) 
Moss (14 Ch. D. 390) 
Taylor (14 Ch. D. 390) 
Ambrose v. The Dunmow Union 222 
Amsinck's case .... 767 
Spottiswood (6 De G. M. & 
G. 345) 
Anchor Assurance Co. (5 Ch. 632) 260*, 

Anchor Insurance Co.'s case (2 J. 

& H. 408) . . . 261, 735 

Anderson's case (17 Ch. Div. 373) 21*, 

69, 123, 124 

(7 Ch. D. 75) . 118, 783, 799 

(3 Eq. 337) .... 738 

(8 Eq. 509) . . . ^829 

Andress's case . . 784, 785, 789* 
Andrew's case (3 Ch. 161) . 821, 856 

v. Burnes . . • 861 

v. Ellison .... 248 

Andrews and Alexander's case (8 

Eq. 176) 853 

Andrews or Jones v. Swansea 

Cambrian B. B. Soc. . . 922 
Angas' case . 41, 563, 750, 807, 862 

Angelo, re . . . . 451, 469 
Angerstein, ex parte 
Anglesea Colliery Co. 783 

Anglo- African Steamship Co. 
Anglo-Australian Assurance 


785, 852, 

869, 882 

685, 688 


641, 650* 

v. British Provident, &c, 

Society . . 169, 184, 201, 586* 
Anglo-Australian and Universal 
Family Life Assurance Co. 
Smith (1 Dr. & Sm. 113) 
Anglo-Californian Gold MiningCo. 662 

v. Lewis . . . 307, 879 

Anglo-Danish and Baltic Steam 
Navigation Co. 
Sahlgreen and Carrall (3 Ch. 
Anglo-Danubian, &c, Colliery Co. 

Walker (6 Eq. 30) 
Anglo-Danubian Co. v. Rogerson 
Anglo-Egyptian Navigation Co. . 
Anglo-French Co-operative Society 

Pelley (21 Ch. D. 492) 
Anglo - French Porcelain Co. v. 
Harris ... . . 







Anglo-Greek Steam, &c, Co. 632, 650*, 


Carralli and Haggard (4 Ch, 174) 
Anglo-Italian Bank and De Rosaz 883 
Anglo-Moravian, &c, Railway Co. 

Dent (8 Ch. 768) 

Forbes (8 Ch. 768) 

Watkin, ex parte (1 Ch. D. 130) 
Anglo-Romano AVater Co. 

Wright (5 Ch. 437) 
Anon. (2 Str. 696) . . . 604 
Apperley v. Page . . . 565, 593 
Appleton i\ Binks . . . 240 
Appletreewick Lead Mining Co. . 784 
Appleyard, ex parte . . . 736 
Apps, ex parte . . . 767, 839 
Archer v. Harrison . . . 920 
Argus Life Assurance Co. 184, 249, 261, 

839, 899 
Arkwright v. Newbould 70, 73, 90, 91, 

Armitage v. Walker . . . 916 
Armstrong's case i v 3 De G. & S. 

140) 715 

(1 De G. & Sm. 565) . 814, 815 

Armstrong v. Burnet . 426, 538, 544 

v. Normandy . . . 706 

Army and Navy Hotel Co. . . 655 
Arnold v. Mayor of Poole . 221, 265 
Arnot's case 705, 752, 760, 762, 781, 
784, 788*, 795* 
Art Engraving Co. . . . 681 
Arthur Average Association 621, 623, 
662, 722, 849, 853, 859 

Hargrove & Co. (10 Ch. 542) 
Arthur v. Midland Railway Co. . 59 
Artistic Colour Printing Co. . 676 

Fourdrinier (21 Ch. D. 510) 
Ashbury's case . . . 666, 672 
Ashbury Railway Carriage Co. v. 

Riche 119, 163, 164*, 176, 315, 334 
Ashbury v. Watson 322, 334, 344, 

396, 405, 435, 470, 584 
Ashby v. Blackwell . . . 483 

Ashley's case . . 85, 776, 777 
Ashpitel v. Sercombe . 31, 32, 33 

Ashton r. Lord Langdalc . 451, 452 
Ashurst v. Fowler . . .378 

v. Mason . • . . 376, 377, 378 

Ashworth's case . . . . 275 
Asiatic Banking Corporation . 7 11 

Agra and Masterman's Bank, 
(6 Ch. 206) 

Collum (9 Eq. 236) 

Royal Bank of India (7 Eq. 91) 

(4 Ch. 252) 

Symons (5 Ch. 298) 
Askew's case (4 Burr. 2200) . 98 

(9 Ch. 664) {. . . 122, 123 

Aslatt v. FarquharsoD . . . 276 
Asphaltic Wood-pavement Co. 

Lee and Chapman (30 Ch. D. 
Association of Land Financiers 

(10 Ch. D. 269) . . .703 

(16 Ch. D. 373) . . 717, 721 

Aston, re . . 66, 133, 135, 487, 488 

Athenaeum Life Assurance Society 

v. Pooley 165, 166, 168, 171, 178, 
180, 193, 224, 237*, 247, 249, 250, 
275, 737, 740 
Athenaeum Life Assurance Society 
Chinnock (Johns. 714) 
Durham (4 K. & J. 517) 
Eagle Insurance Co. (4 K. & J. 549) 
Hollingsworth (3 De G. & Sm. 102) 
Miller (3 Ch. D. 661) 
Painter (4 K. & J. 305) 
Parbury (3 De G. & S. 43) 
Prince of Wales Life Assurance So. 

(Johns. 633) 
Prince of Wales Life, &c, Assurance 

Co. (3 De G. & J. 660) 
Richmond (4 K. & J. 305) 
Sheffield (Johns. 451) 
Atkins' estate .... 661 
Atkins v. Cooke . . . . 661 

Atkinson v. Grey . . . 544 

v. Pocock . . . . 33, 34 

Attenborough's case . . . 203 
Attorneys, ex parte the Society of 98 
Attree v. Hawe .... 451 
Attwood v. Small . . . . 72, 77 
Atwool v. Merryweather . 309, 572, 
573, 576, 578, 579, 581 
Audley Hall Cotton Spinning Co. 865 
Augusta (Bank of) v. Earle . 910 

Auld v. Glasgow Working Men's 

Building Soc. 320, 524, 872, 918, 920 

Austin's case (2 Eq. 435) . 778, 792, 

793, 795* 

(W. N. 1867, 138) . . 839 

Austin v. Guardians of Bethnal 

Green .... 220, 223 
Australasia, Bank of v. Harding . 101 

v. Nias . . . .101 

Australian Steam Clipper Co. v. 

Mounsey . . 191, 199, 203, 
315, 317, 398, 406 

Direct Steam Navigation Co. 

(20 Eq. 325) . 674, 727 

Miller (5 Ch. D. 70) 

Steam Ship Co. (4 K. & J. 407) 264 

Ayers v . South Australian Banking 

Co 163 

Aylesbury Railway Co. v. Mount 123* 

v. Thompson . . .59, 423 

Ayre's case .... 80 

Bagg.s, ex parte . 487, 522, 840 

Baglan Hall Colliery Co. . 783, 798 

Bagnall v. Carlton 347, 355*, 357, 359, 

361, 362 
Bagnalstown and Wexford Rail- 
way Co 198, 505 

Bagshaw, ex parte . 184, 323, 891, 896 

v. Eastern Union Railway 

Co. . 29, 163, 320, 321, 571, 572, 

Bahia and San Francisco Railway 

Co. . . .54, 64, 123, 484 

Baillie V. Goodwin & Co. . • BOS 


Baily, ex parti (3 Ch. 592, and 5 

Eq. 428) 15, 27*, 122, 769, 772 

(15 Jur. 29) . . 529, 843 

v. Birkenhead, &c, Railway 

Co. . . 412, 577*, 600 

r. Macaulay . . .145 

v. Universal Prov. Life Asso- 
ciation . . .45, 54, 59 

and Leetham's case (8 Eq. 94) 865 

Bain v. Whitehaven, &e., Railway 

Co 58, 105, 106 

Baiubridge v. Smith . . 599, 794 

Baird's case . . 426, 812, 848 
Baird v. Ross . . 29, 32, 33 

Bakers case (1 Dr. & Sm. 55) 193, 226, 
328, 382*, 384, 388, 811 
Baker, ex parte (3 De G. & Sm. 243) 686 

v. Plaskitt . . .18, 488 

v. Sutton .... 452 

Baldwin v. Lawrence . . 440, 569 
Bale v. Cleland . . 88, 431, 433 

Balfour v. Ernest . . 165*, 171 

Balgooley Distillery Co. . . . 402 
Ball, ex parte .... 555 
Banco de Portugal 

Hooper (11 Ch. D. 317) 
Waddell (5 App. 161) 
Bangor and Port Madoc Slate Co. 400, 

435, 869 
Bank of Augusta v. Earle . . 910 
Bank of Australasia v. Breillat . 190 

v. Harding . 101, 266, 910, 913 

v. Nias . 101, 266, 294, 910, 913 

Bank of England v. Anderson . 136 

v. Booth . . . .136 

v. Johnson 60, 110, 287, 288, 289 

Bank of Gibraltar and Malta . 640, 

651*, 693 
Bank of Hindustan v. Alison 17, 53*, 
184, 774, 892 
Bank of Hindustan, China, &c. 

Alison (15 Eq. 394) 

(9Ch. 1) 

Anderson (8 Eq. 509) 

Campbell (9 Ch. 1) 

(16 Eq. 417) 

Groom (16 Eq. 417) 

Flicker (13 Eq. 178) 

Harrison (6 Ch. 286) 

Higgs (2 H. & M. 657) 

Hippisley (9 Ch. 1) 

(16 Eq. 417) 

Kintrea (5 Ch. 95) 

Levick and others (5 Eq. 69) 

Los (11 Jur. N. S. 661) 

Martin (2 H. M. 669) 

Mitchell (5 Ch. 400) 

Smith (3 Ch. 125) 

Swan (10 Eq. 675) 
Bank of Hindustan, &c. v. Eastern 

Financial Association . . 710 
Bank of Ireland v. Evans's Charity 

Trustees . 198, 224, 483, 486 

v. Perry . . . . 727 

Bank of London, &c, Insurance 
Association . . . 114, 617 

Part (10 Eq. 622) 

Bank of London and National, &c, 
Muggeridge (10 Eq. 443) 
Bank of London v. Tyrell 34S, 357, 361 
Bank of Montreal v. Bathune . 910 
Bank of New South Wales v. 

Owston 210 

Bank of Scotland o. Fenwick . . 295 
Bank of South Australia v. Abra- 
hams ..... 192 
Bank of Turkey v. Ottoman Co. . 372 
Banks v. Parker . . . . 569 
Bannatyne v. Direct Spanish Tel. 

Co. . . 397, 403, 406, 435, 602 
Banner v. Johnston . . 698, 727 
Bauque Jacques Cartier v. La 

Banque, &c. , de Montreal . 205 

Banwen Iron Co. v. Barnett 111, 129, 

Barangah Oil Penning Co. 
Arnot(36 Ch. D. 702) 
Barber's case (1 De G. & S. 726) . 687 

(5 Ch. D. 963) . . 793, 795 

Barber, ex parte (1 Mac. & G. 176) 623, 
646*, 662, 663, 684 

re (15 Jur. 51) ... 16 

Barber & Co 230,729 

Agra Bank (9 Eq. 725) 
Barclay's case . 66, 133, 464, 468, 
487, 619, 621, 622, 799 
Barclay v. Wainwright . . 545 
Bardwell v. Sheffield Waterworks 

Co. . 
Barsate r. Shortridge 

. 431, 432 
52, 56*, 299, 
423, 466, 560 
744, 786 
. . 500 
201, 243, 522 
. . 540 
. 145 
. . 145 
692, 705 

Barge's case 
Baring v. Corrie 
Barker v. Allan . 

v. Buttress 

v. Lyndon . 

v. Stead . 

Barned's Banking Co. . 

Andrew (3 Ch. 161) 

Andrews (4 Eq. 458) 

Contract Corporation (2 Ch. 350) 

(3 Ch. 105) 

Coupland (8 Eq. 472) 

(5 Ch. 167) 

Forwood (5 Ch. 18) 

Helbert v. Banner (L. R. 5 H. L. 28) 

(6 Eq. 509) 

Joint Stock Discount Co. (19 Eq. 1) 

(10 Ch. 198) 

Kellock (3 Ch. 769) 

Leech (6 Ch. 388) 

Peel (2 Ch. 674) 

Shrapnell (M.R. 24 April, 1867) 

Thornton (2 Ch. 171) 
Barned v. Hamilton . . . 498 
Barnes v. Addy- . . . . 362 

v. Thrupp . . . . 672 

Barnet v. North Metropolitan 
Junction Railway Co. 

Nicholay's case (15 Jur. 420) 
Barnett's case (18 Eq. 507) . 521, 841 

(19 Eq. 449) . . .742 

Barnett, Hoares & Co. v. Smith . 483 



Harnett, Hoares & Co. 
London Trams Co. 


. South 

154, 161, 183 

206, 218* 

143, 145, 606 

. 268, 269 



Barnelt v. Lambert 
Barnewall v. Sutherland 
Baron de Beville's case 
Baron Liebig's Cocoa Works, 
Limited ..... 
Baroness Wenlock v. River Dee 

Co. 112,238'. 

Barrett's case (3 De G. J. & Sm. 

30) . . 16, 80, 82*, 213, 214, 762 

(4 De G. J. & Sm. 416) 46, 742, 

801, 803, 839 

Barrett r. Blunt . . . .145 

Barrow's case (14 Cli. D. 432) 64, 369, 

785, 787, 789 

(3 Ch. 784) . . . . 847 

Barrow-in-Furness Investment Co. 785 
Barrow Haematite Steel Co. . 403 

Barry v. Croskey. . . 218*, 488 

v. Navan and King's County 

Railway Co. 
Barry Railway Co. 
Barry's representatives, ex parte 
Bartlett v. Pentland . 
Bartley, ex parte 
Barton's case . 322, 528, 529, 534, 761* 

trust .... 545, 546 

Barton v. Hutchinson . . 149, 262 
v. London and North- West- 
ern Railway Co. . . . 

v. North Staffordshire Rail- 
way Co. ..... 

Barwick v. English Joint Stock 

Bank .... 207, 214, 217* 

Bass's case .... 703, 708 

Bastenne Bitumen Co. . . 652* 

Bastow & Co. . . 676, 677 

Batard v. Hawes . . . . 606 

Bateman v. Mayor of Ash ton-under- 

Lyne . . . 186,199,598 

v. Mid Wales Railway Co. . 185 

v. Service [. 115,909,912,914 

Bates v. Mackinley . . . 547 
Bath's case . 196, 319, 374, 521, 842, 

845, 856 




Batten v. Wedgewood Coal Co. 
Batty v. McCundie . . . 

Baxter v. Earl of Portsmouth 
Bayley v. Manchester and Sheffield 
Railway Co. . ... 

v. Wilkins .... 

Bayliffe v. Butterworth . 

Bear v. Bromley .... 

Beardshaw, ex parte . . 766 


Beech v. Eyre ..... 266 
Beeching v. Lloyd . . . 568 
Beer v. London and Paris Hotel 

Co 228 

Beldon v. Campbill . . .192 
Belfast, &c. Railway Co. v. Strange 424 
Belhaven's (Lord) case . 521, 842, 845 
Bell's case (4 App. Cas. 550) 42, 80*, 
86, 733, 802, 808, 809, 810 

(22 Beav. 35) ' . . 80*, 86 

Bell v. Francis . . . . 145 
v. London and North- West- 
ern Railway Co. . . . 183 

v. Mexborough . . . 589* 

v. Reid 37 

Bell and Lang's case (4 App. Ca 





, 861 
Londesborough . 670, 706 
Beattie v. Lord Ebury 196, 242, 805, 806 
Beaujolais Wine Co. . . . 887 
Beaumont v. Meredith . . . 575 
Beavan v. McDonnell ... 40 
Beck's case 17, 25, 26, 769, 773, 774 
Beck v. Dean ..... 560 

v. Kantorowicz . 346, 352*, 566 

Beckitt v. Bilbrough . . 473, 499 
Bedford v. Bagshaw . . 88, 496 

Bedford Railway Co. v. Stanley . 151 

Bellairs v. Tucker 
Beman v. Rufford 

297. 37; 

Bendy v. Harding 
Benham's case 
Bennett's case 
Bennett v. Blain . 
Benson v. Paull 
Bent v. Young . 
Bentham Mills Spinning Co. 

. 69, 89* 
183, 322, 571. 
580*, 598, 892, 893 
. . 295 

Bentinck (Cavendish) v. Fenn 
Bentley, ex parte 

v. Bates . 

v. Craven . 

Beresford's case 

Berkeley v. Standard Discount Co 

Bermingham v. Sheridan 

. 840 
519, 839 
280, 603 
459, 468, 
538, 552 
. 785 
. 550 
. 360 
529, 843 
466, 491, 493, 
499, 505, 511 
82*, 84, 759, 860 
'. Bank of 




Bernard's case 
Berne (The City of) 

England ..... 
Besley, ex parte . 623, 698, 765 
Bessemer Steel and Ordnance Co. 
Best's case (2 De G. J. & Sm. 650) 

15, 769 
Best, ex parte (1 Sim. N. S. 193) 747 

v. Pembroke . . . 697 

Betts v. De Vitre . . 209, 240, 265 
Beulah Park Estate 

Sargood (15 Eq. 43) 
Bevan v. Waterhouse 
Beverley v. The Lincoln Gas Co. 
Beville's case (Baron de) 
Biederman v. Stone . 494,501,514 
Bigg's case (1 Eq. 309) . . 533, 844 
Bigge's case (5 Jur. N. S. 7) 82, 84*, 

Bignold, ex parte 174. 381, 382, 387*, 

389, 594, 851 

Bill v. Darenth, &c, Railway Co. 332 

v. Richards. . . . 284* 

V. Sierra Nevada, &c, Co. 324, 601, 

Bilton Hotel Co. . . 792, 1'X' 

Birch's case . 59, 60, 94, 256, 624, 

748, 840 
Birch Torr & Vitif'er Co. . . 

Lawton (1 K. & J. 204) 




Bird's case (4 De G. J. & Sm. 200) 15, 
761, 769, 791, 796 

(1 Sim. N. S. 47) 111, 129, 761, 862 

Bird v. Bird's Patent Sewage Co. 894 
Birkbeck Life Assurance Co. 

Barry (representatives of), (2 Dr. & 
Sm. 321) 
Birkenhead, Lancashire, &c. , Rail. 

Co. v. Brownrigg . 59, 105, 425 

v. Cotesworth . . 426, 427 

v. Pilcher . . . 39, 422 

. v. Webster .... 416 

Birmingham Banking Co. (3 Ch. 

651) . . • • 156,175,881 

(6 Ch. 83) . . • • 669 

Birmingham, Bristol, &c, Railway 

Co. v. Locke . 49, 51, 58, 106, 421, 
533, 534 
. . 440 

v. White . . • • 

Birmingham and Lichfield Rail- 
way Co. (18 Ch. D. 155) . 

(28 Ch. D. 652) . . 102 

Bishop's case . - . 825. 
Black v. Homersham . . 490, 493 
Black & Co.'s case , 742, 744, 754, 858, 

20, 25, 84, 749, 772 



Blackburn's case 

Blackburn Benefit Building Society 

v. Cunliffe, Brooks & Co. . 

178, 187, 189, 190*, 191, 237" 

Blain v. Agar 

Blake v. Mowatt 

Blake's case 

Blakeley's executors, ex parte 

, 842 
. 537, 
. 741* 


Blakely Ordnance Co. 
Brett (8 Ch. 800) 

(6 Ch. 800) 

Creyke (5 Ch. 63) 

Lumsden (4 Ch. 31) 

Metropolitan and Provincial Banks 

(8 Eq. 244) 
New Zealand Banking Co. 

Ch. 154) 
Keedham (4 Eq. 135) 
Stocken (3 Ch. 412) 

(5 Eq. 6) 

Blann v. Bell .... 

Bleackley"s case 

Blewitt v. Gordon 

Bligh v. Brent 

Blissct v. Daniel 

Blood, ex parte 

Bloomer v. Union, &c, Coal C< 

Blount v. Hipkins . 

Bloxam's case (4 De G. J. & S. 

447) ... 15, 770 

(36 L. J. Ch. 687) . 691, 692 

Bloxam v. Metropolitan Cab Co. . 421, 
497, 592, 597 

v. Metropolitan Railway Co. 430, 

432, 442, 568, 571, 580, 597 
Bluck v. Mailable . 328, 388, 572, 586, 

597, 600 
Blundell, re .... 361 
v. Winsor . 2, 131, 132*. 133* 


. 266 
452, 453 
318, 532 
. 735 
426, 544 


Blyth's case . . 783, 787 

Blyth & Co.'s case . . . . 761 
Bodmin United Mines, 94, 95, 524, 715, 

749, 840 
Bog Lead Mining Co. v. Montague 45, 

119, 129 
Bolckow, Yaughan & Co. v. Fisher 595 
Bolingbroke (Lord) t\ Local Board 

of Swindon .... 209 
Bolognesi's case . . . 881 

Bolton Benefit Loan Society . 620, 
628, 648* 
Coop v. Booth (12 Ch. D. 679) 
Bolton v. Madden . . . . 309 
Bonar v. Mitchell . . .109 
Bonelli's Telegraph. Co. . . . 

Collie (12 Eq. 246) 
Booker, ex parte . . ■ 200 

Booth v. Bank of England . . 136 
Borough of Hackney Newspaper 

Co. (3 Ch. D. 669) . . . 203 
Borough of St. Marvlebone . . 
Buck (3 De G. & Sm. 267) 
Joint Stock Banking Co. 
Stanhope (3 De G. & Sm. 198 
Bosanquet v. Graham . 283, 295, 297 

v. Ransford . . • • 286 

v. Shortridge . 55*, 59, 110, 

158, 288, 289, 423 

v. Woodford . . . . HO 

Boston Deep Sea Fishing Co. v. 

Ansell . . . 147, 149, 367 
Boston, Newark, and Sheffield 
Railway Co. 

Williams (1 Sim. N. S. 57) 
Boswell v. Gurney . . .721 
Bosworthon Mining Co. . 619, 646*, 
654*, 659 
Jones (6 Ch. 48) 
Bottomley's case . 157*, 409, 532, 843 
Bottomley v. Fisher . . . 233* 
Bouch v. Sevenoaks Railway Co. 
. 393, 545' 




21, 144, 393 

v. Sproule 

Boulter v. Peplow 
Boulton, ex parte 
Bourne v. Freeth 
Bousfield v. Wilson . 140, 488 
Boussmaker. ex parte ... 
Bowen v. Brecon, &c, Rail, Co. 
Bowen &; Martin's case 
Bowes v. Hope Mutual Life As- 
surance Co. 
Bowlby v. Bell . 
Bowring v. Shepherd 



453, 498, 513 

493, 501, 506, 


Bowron, Baily & Co. 

Baily (5 Eq. 428) 
Box, re 544 

Bovce v. Green .... 453 
Bovle v. Bethos Llantwit Coll. Co. 675, 
677, 706, 883 
Brackenburv «. Brackenbury . 140 
Bradford Banking Co. v. Briggs 

k Co. . . 129, 459*, 477, 478 

Navigation Co. . 618, 647*, 658, 

Tramways Co. . .102, 904 



Bradley v. Eyre . 

v. Eoufdsworth 

v. Warburg 

Bradshaw, ex parte 
Braham v. Beaehim 
Bramah v. Roberts 


283, 286, 295, 297 

. 453 

. . 295 

192, 197, 665 

. . 113 

155, 185, 244 

Brampton v. Longtown Kail. Co. 


Addison (20 Eq. 620) 

Shaw (In Ch. 177) 
Brander v. Brander . . . 545 

Branley v. South-Eastern Railway 

(o. ' 913 

Breckenrid.^'s ease . 122, 125, 748 

Breech Loading Armoury Co. (4 

Eq. 453) 690 

Calisher (5 Eq. 21 t) 
Merchants' Co. (l Eq. 453) 
Wragge (6 Eq. 284) 
Bremner v. Chamberlayue . . 145 
Brentford and Islcworth Tram- 
ways Co. . . 278, 618, 905 
Brentwood Brick and Coal Co. . 727 
Brereton v. Edwards . . . 461 
Brett's case (6 Ch. 800; 7 Ch. 

200; and8Ch 800) 821, 
856, 857, 867* 

(25 Ch. D. 283) . 792, 793, 795 

Brettell v. Dawes . . 699, 670 
Bridger's case (4 Ch. 266) . 534, 845 

(5 Ch. 304) . . .782 

Bridgwater Navigation Co. . 396, 405, 

434, 455, 679, 681, 717, 721, 868*, 

869, 870, 880, 960, 966 

Bridport Old Brewery Co. . . 306, 

307, 877*, 879, 887 

Briggs, ex parte (1 Eq. 483) . 26, 28, 85 

(8 W. R. 110) . . 722 

Bright'scase .... 765, 766 

Bright v. Hutton 144, 623, 626, 764, 

765*, 766, 901 

Brighton Arcade Co. v. Dowling . 428, 

744, 748, 884, 885 

Club and Norfolk Hotel Co. 638, 


Hotel Co. . . 636, 652* 

Lewes, &c, Railway Co. . 656 

Conway (5 De G. & Sm. 150) 
Hirschel, ex parte (15 Jur. 942) 
Bristed v. Wilkins . . 460, 462 
Bristol and North Somerset Rail- 
way Co 905, 906 

Bristol and Taunton, &c, Co. v. 
Amos ..... 57 

Britannia Mills Co. ... 1029 

British Alkali Co. 

Guest (5 De G. & Sm. 458) 
British Alliance Assurance Corpo- 
ration .... 634, 635 

British and American Steam Navi- 
gation Co. . .... 

Goldsmid (16 Beav. 262) 
Meyer (16 Beav. 383) 
Pearse (8 Eq. 506) 
Ward (10 Eq. 659) 
British and American Telegraph 
Co. v. Albion Bank . . 200, 205 

British and American Telegraph 

Co. v. Colson . . . • 14 
Fowler (14 Eq. 316 
British Empire Co. v. Browne . 226 

British Fanners' Pure Linseed Cake 

Co. ... 61. 395, L022 

British and Foreign Cork Co. 

Leifchild (1 Eq. 231) 
British Guardian Life Assu 

Co. ... 694. 695, 696 

British Imperial Corporation . 749, 693 
British India Steam Navigation 
Co. v. Commissioners of Inland 
Revenue ..... 196 
British Mutual Banking Co. '■. 
Charnwood Forest Railwaj Co. 

2i7*, 4S4, 486 
British Nation, &c., Association, 
ex parte the Liquidators of (8 
Ch. I). 679 . 4:!. 183, 207, 806, 807 
British Nation Life Assurance 
Association (14 Eq. 492) . 703, 878, 
879, 890 
British Provident Lit'' and Fire 
Assurance Co. . . 641, 653* 

Coleman (1 DeG. J. & S. 495) 
Collins (1 Dr. & Sm. 113) 
DeRuvigne(5Ch. 1>. 306) 
Grady (1 De G. J. & S. 489) 
Lane (1 De G. J. & S. 504) 
Orpen (9 Jur. N. S. 615) 
Rumnev (4 N. R. 48) 
Stanley (4 De G. J. & S. 407) 
Teete (4 N. R. 48) 
British Provident Assurance So- 

ciety v. Norton . 313, 328, 382 
British Provident and Anglo-Aus- 
tralian Assurance Cos. . . 735 
British Seamless Paper Box Co. 370, 695 
British Sugar Co. . 61, 62, 122, 306, 

British Waggon Co. v. Lea & Co. . 708, 

Briton Life Association . 857, 898 
Briton Medical Assurance Associa- 
tion 674, 676 

Briton Medical and General Life 

Brittain. ex parte . 
Broadbent, ex parte 
Brockwell's case 


126. 940, 955 

.' 765, 862 


80*, 82, 



Bromley v. Williams . . . 
Bromsdon v. Winter . 
Brooke & Co. (G. F.) . . . 
Brotherhood's case, 179, 518, 519* 

584, 822 
Broughtou v. Hutt . . . 813 
v. Manchester and Salford 

Waterworks Co. . 136, 185. 220 
Brown's case (9 Ch. 102) 788*, 792, 793, 


(19 Beav. 97) 316, 758, 831, 841* 

Brown's claim (9 W. R. 366, & 10 

ib. 662) . . 180, 237*, 735 

Brown, Ex parte (3 De G. & Sm. 

590) 555 




736, 742 
. 839 





Brown, ex parte (12 Ch. 823) 

(8 De G. M. & G. 607) 

Bayley & Dixon (18 Ch. D. 


v. Andrews 

v. Black . . .509 

v. Byers . . 185, 192, 244 

v. Dale 867 

v. Hall .... 

v. Holt 

v. London and North- 
Western Railway Co. 

r. Savage .... 

Browne v. Collins . . 430, 544, 545 

v. La Trinidad . 148, 157, 158, 

176, 302, 305, 567, 602, 792 

v. Monmouthshire, &c, Co. 430. 

572, 600 
Brownlie v. Campbell 

v. Russell . . 524 

Browning v. Great 

Mining Co. . 
Brumfitt v. Bremner . 
Brunton's claim 
Bryon v. Metropolitan 
Omnibus Co. 

70, 241 
872, 918, 920 

149*, 160* 
. 173 
. 740, 741 
190, 191*, 317, 
398, 406, 600 

r. Warwick and Birming- 
ham Railway Co. . . 372, 571 

Buchan's case 426, 549, 53S, 806, 814 
Buck y. Buck . 131, 140, 487, 516 

v. Robson . . . 813, 848 

Budd's case . . . 826*, 864 

Budden, ex parte . . 553, 815, 816 
Buenos Ayres Railway Co. v. 

North Railway Co. of Buenos 

Ayres 912 

Bugg, ex parte 46, 746, 802*, 805, 860 

Bulkeley v. Schutz 
Bullock v. Caird 

v. Chapman 

Buhner's case 
Buhner v. Norris 
Bult v. Morell . 
Bunn, ex parte 

Bunn's case (2 De 

275) . 
Burge, ex parte (1 De G. & 

588) .... 

Burge's case (2 J. & H. 441) 

Burgess's case (15 Ch. D. 507) 

(3 Jur. X. S. 

G. F. & 
17, 201, 

. 115, 912 


60, 61, 596 

813, 814 

. . 452 

185, 231, 232* 


759, 781* 

617, 901 

178, 180, 

, 236, 864 


776, 777 

Burke v. Dublin Trunk Railway 

Co. . . 291, 292, 296 

r. Lechmere . . . 19, 106 

Burkinshaw v. Nicolls 64, 396, 783, 

785, 787 
Burlinson's case . . -42, 808 
Burmester v. Crofton . . . 296 

v. Norris . . . . 192 

v. Von Stentz . . .268 

Barnes v. Pennell 29, 49*, 51, 84, 87, 

88, 154*, 155, 161, 206, 215*, 217*, 

298, 421, 433 

Burns v. Poulsom . . . . 209 


Burnside v. Dayrell . . 35, 145 

Burstall r. Beyfus .... 362 
Burt v. British Nation Assurance 

Co 520, 568, 584* 

Burton, ex parte .... 779 

v. Tannahill . . . 266, 268 

Bush's case (6 Ch. 246 and L. R. 

6 Ho. Lo. 37) 52, 316, 466, 749, 
758, 822, 824, 832, 841 

(9 Ch. 554) . . 783 

Busk's case . . . 518, 840 

Butchart v. Dresser . . . 317 

Butler v. Cumpston . . 805, 809 

v. Manchester and Sheffield 

Railway Co. . . . 209 

v. Withers . . . 450 

Butt v. Monteaux 135, 139, 565, 593, 

Bwlchy Plwm Lead Mining Co. 

v. Baynes 422 

Byrne v. Van Tienhoven . . 14 

Cadiz Waterworks Co. v. Barnett 637 
Cadman v. Cadman . . . 541 

Caerphilly Colliery Co. 

Pearson (5 Ch. D. 336) 
Caillaud's, &c, Co. v. Caillaud . 264 
Calcutta Jute Mills Co. v. Nichol- 
son 38, 911 

Caldecott, ex parte . 458, 550, 555 

Calder, &c, Nav. Co. v. Pilling 

308, 322 
Caldicott v. Griffiths ... 606 
Caldow v. Pixell . . . . 173 
Caldwell v. Ernest . . .712 
Caledonian and Dumbartonshire 
Railway Co. v. Magistrates of 
Helensburgh . . . 151, 
Calisher's case .... 742, 
Callao Bis Co. .... 
Calthrop, re . . . . . 
Cambrian Mining Co. . 
Railway Co. . . 904, 905, 

Coleman (3 De G. & S. 139) 

Steam Packet Co. . . . 

Cambridge and Colchester Rail- 
way Co. 

Marsh (1 M. & G. 302) 
Cameron Coalbrook, &c, Co. 692, 

Bennett (5 De G. M. & G. 

Hunt (32 Beav. 387) 

Walter (3 De G. & S. 2) 
Campbell's case (9 Ch. 1) 53, 344, 

(4 Ch. D. 470) 197, 369, 401, 

Campbell v. Compagnie Generale 

de Bellegarde . 675, 

v. London and Brighton 

Railway Co. 

v. Maund .... 

Canadian Land Reclaiming, &c., 
Coventry & Dixon (14 Ch. 
D. 660) 










Canadian Native Oil Co 

Fox (5 Eq. 118) 
Canadian Oil Works Corporation. 

Hay (10 Ch. 593) 
Cane v. Chapman . . . . 280 
Cann v. Will son . . .70, 89 

Caiman's claim . . . 703 

Cannock and Rugeley Colliery 

Harrison (28 Ch. D. 363). 
Cannon, ex parte . 366, 389, 736, 742 

v. Trask . . . 304, 309 

Canwell, ex parte . . 550, 556, 848 
Cape Breton Mining Co. (29 Ch. 

D. 795) . . . 346, 350, 358* 
— (19 Ch. D. 77) . . 695, 815 

v. Fenn . . . . 708 

Cape's Executor's case . . 254, 823* 
Capel & Co. v. Sim's Composi- 
tion Co 92 

Capital Fire Insurance Associa- 
tion (21 Ch. D. 209) . 628, 649* 

(24 Ch. D. 408) . . 668, 692 

Capper, ex parte (1 Sim. N. S. 

178) . . 765, 766, 861 

(3 De G. & S. 1) 626, 627, 653 

Capper's case (3 Ch. 458) 123, 810, 828 
Car v. Griffith . . . . 10 

Card v. Carr . . . .156, 922 

v. Hope .... 309 

Carden v. General Cemetery Co. 

146, 363 
Cardiff and Caerphilly Iron Co. 

Gledhill (3 De G. F. & J. 713) 
Cardiff Coal Co. . . 414,787,854 

v. Norton 278, 414, 694, 787, 854 

Carew's case (5 De G. M. & G. 

94) 664 

(7 De G. M. & G. 43) 818, 851 

Carew's claim (24 Ch. D. 85) 171, 193 
Carew's Estate Act (No. 2), re 

(31 Beav. 39) . . . . 204 

Cargill v. Bower . . .74, 89, 244 
Caribbean Co. 

Crickmer (10 Ch. 614) 
Carlen v. Drury . . 245, 575*, 600 
Calling's case . 368, 781, 782, 788, 

790, 795 
Carlisle Banking Co. v. Thompson 920 
Carlisle v, South-Eastern Railway 

Co. . . 571, 574*, 580, 597 
Carmarthen Railway Co. v. Wright 45, 
46, 50, 59, 107, 420, 421 
Carmichael's case . 15, 163, 767, 770 
Carnelley, ex parte . . . . 674 
Carpenter's and Weiss's case . 693 
Carr v. Griffith . . 462, 546, 547 
v. London and North- West- 
ern Railway Co. . . 48, 487 
Carr's case ... . . 734 
Carralli and Haggard's claim (4 

Ch. 174) .... 557, 743 
Carriage Co-operative Supply As- 
sociation . 367, 375, 376, 679, 696, 
697, 744, 786, 790 
Clemence (23 Ch. D. 154) 
Carrick's case .... 765, 766 


Carroll v. Kennedy . . .671 
Carron Co. v. Maclaren . . 37, 912* 
Carshore v. North- Eastern Rail- 
way Co 483 

Carta Para Mining Co. . . . 661 
Carter's case .... 696 
Carter v. Dean of Ely . . 220, 221 
Caitmell's case . 156, 161, 17S, 467, 
518, 522, 829 
Castellan v. Hobson . . 509, 511 
Castello's case . . .811, 828 

Catchpole v. Ambergate, &c, 

Riilway Co. . . . 63, 534 

Pathcart, re .... 691 
Catholic Publishing ' !o. 385. 637, 638, 

Cavendish Bentinck v. Fenn . 358, 695 
Cefn Cilcen Mining Co. . . 191 
Central Darjeeling Tea Co. . . 710 
Cercle Restaurant Castiglione Co. 

v. Lavery .... 637 

Cesena Sulphur Co. v. Nicholson 38, 

Chadwick, ex parte . . . 693, 705 
Chalk, Webb & Co. v. Tennent . 848 
Challis's case . . 53, 759, 775" 
Chambers v. Manchester, &c, 

Railway Co. . . . 198, 235 

Chancey v. .May .... 566 
Chandelor '•. Lopus . . . 70 
Chandler v. Howell . . . 451 

Chapel House Colliery Co. . 636, 648 
Chapleo v. Brunswick Building 

Society . 88, 166*, 171, 176, 189, 
196, 242, 919, 920 
7.">4, 782, 
805*, 806 

Chapman and Barker's case 
Chapman's case (1 Eq. 346) 
(2 Eq. 567) 

685, 717, 


. 13, 14, 15, 

567, 795 

268, 427, 565 

493, 514, 832 

465, 824, 829 

. 556 

207, 208 



Chapman v. Milvaiu 

v. Shepherd 

ChappelPs case 

Chappie's case 

Chappie v. Cadell . 

Charitable Corporation v. Sutton . 

Charlesworth, ex parte . . 698 

703, 878, 890 

Charlton v. Newcastle and Carlisle 

Railway Co. . 322, 571, 598, 892 

Chatham Industrial Co-operative 

Society 91 6 

Chatteris, ex parte . . . 687 

Chartres' case . . . 831, 862 

Cheale v. Kenward . . 473, 492 

Cheltenham and Swansea Railway 

Carriage, &c, Co. (8 Eq. 580)". 656 

Cheltenham, &c. , Railway Co. v. 

Daniel . 49*, 51, 108, 421 

v. Price . . .59, 105, 106 

Chepstow Bobbin Mills Co. . 660, 887 

Cherry v. Colonial Bank of Aus- 
tralasia . . . .89, 243 

Cheshire Banking Co. 

Duff's Executors (32 Ch. D. 




Cheshire Patent Salt Co. . 626 

Chester and Manchester Direct 
Railway Co. 

Phillipps (1 Simons, N. S. 
Child v. Hudson's Bay Co. . 

v. Morley . . . . 

Chillington Iron Co. . 
China Steamship Co. 
Capper (3 Ch. 458) 
Dawes (6 Eq. 232) 
Drummond (4 Ch. 772) 
Mackenzie (7 Eq. 240) 
China (Imperial Bank of) v. Bank 

of Hindustan . . . 

Chinnock's case (Johns. 714) 803, 826* 

Chippendale, ex parte . 236, 381, 384, 

385, 387*, 389, 622, 851, 858, 860 

Chorley, ex parte . . . 283,741 



Christie v. Peart . . . 
Church and Empire lire Insur- 
ance Co. 

Andrews (8 Ch. D. 126) 
Pagin and Gill (6 Ch. D. 631) 
Church v. The Imperial Gas Light 


Churchill v. Bank of England 
Chynoweth's case . 95, 326, 



465, 819, 
825, 828 

Cilfoden Benefit Building Society 700 
City Bank, ex parte 171, 185, 230, 740 
City and County Bank . 626, 640, 641, 
653*, 655 
City and County Investment Co. 208, 
864, 895, 896 
City of Berne v. Bank of England 909 
City of Glasgow Bank . . .962 
Bell, Lang and others (4 App. 547) 
Buchan (4 App. 549) 
Ker (4 App. 549) 
Mitchell (4 App. 548) 
Rutherford (4 App. 548) 
City Terminus Hotel Co. 

South-Eastern Railway Co. (14 Eq. 
City of Moscow Gas Co. v. Inter- 
national Financial Society . 263 
Clack's case .... 829, 840 
Clark v. Newsam . . . . 66 

ex parte (7 Eq. 550) 715, 731, 743, 

Clarke v. Chaplin ... 30 

v. Dickson . . 72, 88, 496 

v. Imperial Gas Light and 

Coke Co 168* 

Clarke's case (W. N. 1866, 254) . 710 

(1 K. & J. 22) . . 664. 860 

(8 Ch. D. 635) . . 783, 784* 

— ex parte (20 L. J. Ch. 14) . 766 

(12Jur. 471) 


re (18 Ch. D. 160) . 


Clay v. Rull'ord . 177, 

183, 272, 


323, 567 


v. Southern 


Cleare v. Harwas . 


Clegg v. Edmoudson . 


Cleland's case . 

745, 784 


Clemence, ex parte (23 Ch. D. 154) 679 
Clement's case (13 Eq. 179) . 691, 692 
Clements v. Bowes . 565, 569, 593, 610 

■ v. Hall 

v. Todd . 

Clemonston v. Blessig . 

Cleve v. Financial Corporation 






, 894 




840, 862 
. 260* 

Cleveland Ironworks Co. 

venson ..... 72 
Clifton's case . . . 664, 863 
Clinan v. Cooke . . . . 228 
Clinch v. Financial Corporation . 208, 

571, 580, 581, 595, 891, 892, 894, 895 
Clive v. Clive . . 544, 545, 547 
Clothworkers' Co., ex parte . 553, 554 
Clough v. London and North 

Western Railway Co. . . 584 
Clowes v. Brettell . 59, 288, 293, 294 

Cluff v. Cluff 451 

Coal Consumers' Association 679, 680, 
717, 720, 721 
Coal Economising Gas Co. 

Gover (20 Eq. 114, and 1 Ch. 
D. 182) 
Coates' case .... 783 
Coates v. Nottingham W. W. Co. 
Cobharn v. Holcombe . 
Cobre Copper Mining Co. 
Kelk (9 Eq. 107) 
Pahlen (9 Eq. 107) 
Weston (6 Eq. 17) 
Cockburn's case . 
Cocker's case . 
Cockerell v. Van Diemen's Land 

Co 499, 532 

Coe v. Wise 209 

Cohen v. Wilkinson . . 571, 598 
Colborne and Strawbridge, ex parte 

171, 230, 665, 725, 740, 878, 889 
Colchester (Mayor of) v. Lowten . 198, 

207, 224 
Cole v. North Western Bank . 475 
Coleman's case (1 De G. J. & Sm. 

495) . 53, 759, 781*, 841, 844, 845 
Coleman, ex parte (3 De J. & S. 

139) .... 664, 701 
Coles v. Bristowe . 495, 501, 504*, 510 

v. Trecothick . 

Collen v. Wright . 

Collie's claim . 

Collingridge, expaite . 

Collingwood v. Berkeley 

Collins v. Collins . . 450. 

;;. South Staffordshire Pail- 

way Co 228 

, ex parte (De G. 381) . . 550 

(8 W. R. 170) . . . 653* 

Collum, ex parte . . 66, 800, 843 
Colman v. Eastern Counties Rail- 
way Co. . . . 200, 571, 597 
Colombia Chemical Factory Ma- 
nure, &c, Works 

Brett (25 Ch. D. 283) 
Hewitt (25 Ch. D. 283) 
Colonial Bank v. Hepworth 

v. Whinney 


474, 482* 
454*, 551 






Colonial and < ieinral Co. 
Colonial Life Assurance Co. v. 
Home and Colonial Assurance 


Colonial Trusts Corporation 

Bradshaw(15 Ch. D. 165 
Colquhoun v. Brooks . 
Colt v. Ncttcrvill 

V. Woollaston 

Coltman, re .... 
Columbine v. Chichester . 500, 51 
Colyear v. Mulgrave . 
Commercial Bank Corporation of 
India and the East . 261, 622, 710, 

Fernandes' Executors (5 Ch. 

Gledstane & Co. (1 Ch. 538) 
Smith, Fleming & Co. (1 Ch. 

Wilson (8 Eq. 240) 
( 'ommercial Bank of London 
Commercial Bank of South Aus- 
tralia . 622, 623, 636, 644*, 912 
Commercial Discount Co. . 660, 701 
Commercial and General Life, &c, 

Johnson (27 L. J. Ch. 803) 
Commercial, &c, Wine Co. . 
Compagnie Generale de Bellegarde 

Campbell (4 Ch. D. 470) 
Connell, re . 

Connop v. Levy . . . 

Conquest's case .... 
Consols Insurance Association 
Benham (13 W. R. 483). 
Glanville (10 Eq. 479) 

v. Newall . . . . 

v. Wood . . . . 

Const v. Harris . 317, 318 




. 472 

. 713 

319, 320*, 

and Alexandra 




Hotel Co. 

Ebbett (5 Ch. 302) 

Reidpath (11 Eq. 86) 
Consterdine v. Consterdine . 
Continental Bank . 

Castello (8 Eq. 504) 
Contract Corporation . 43, 157, 224, 
225, 473, 660, 691, 692, 759, 807, 836, 
846, 847, 850, 851 

Baker (7 Ch. 115) 

Batemau (1 W. N. 378 and 

Druitt (14 Eq. 6) 

Ebbw Vale Co. (5 Ch 

Gooch (14 Eq. 454) 

(8 Ch. 266) 

(7 Ch. 207) 

Head (3 Eq. 84) 

Hudson (12 Eq. 1) 

Weston (6 Eq. 1") 

White (3 Eq. 84) 
Conway's case 
Conybeare v. New Brunswick and 

Canada Railway Co. . 84, 590* 

Cooch v. Goodman . . . . 131 


15, 861 




Cook's claim (2) . 


Cook v. Gregson . 

v. Jones 

v. Ward 

Cooke v. Tonkin . . . . 

v. Oceanic Steam Co. . 

ex parte (3 De G. & S. 148) . 

627, 646* 
Cookney's case . . . . 761 
Cookson, ex parte . . 641, 650* 
Cooper v. Powis . . . .569 

v. Shropshire Union Rail way 

and Canal Co. . 411, 600 

v. Webb . . . 565, 593 

, ex parte (2 M. D. & D. 1) . 551 

(10 Ch. 510) . . .669 

Cope v. Thames Haven Co. 221, 225 

Cope's case .... 247, 248 
Copeland v. North-Eastern Rail- 
way Co. . . 63, 109, 469 

v. Stephens . . . 550 

Copin v. Adamson . . . 914 

Copper Miners' Co. v. Fox . 199, 220, 
222, 224, 225 
Corbett v. The General Steam 

Navigation Co. 
Corder v. The Universal Gas Light 


Cork and Bandon Railway Co. v. 

Cazenove . . . .39, 422 

v. Goode . . 425, 427, 537 

Cork Constitution, Limited . 655 

Cork Shipping and Mercantile Co. 630 

Cork and Youghal Railwav Co. (4 

Ch. 748) . . 198, 235, 237*, 


v. Paterson 23, 24, 107, 410, 420 

Cornell v. Hay . . . . 9i ; q-> 
Corner v. Maxwell-Irwin . 270, 559 

Cornwall Great Consolidated 

Mining Co 313 

Cornwall, &c. , Mining Co. y. 

Bennett .... 125, 417* 
Corpe v. Glyn . 278, 279, 280, 604 

Corry v. Londonderrv, &c, Co. . 401, 

429, 430 
Cosmopolitan Life Assurance Co. 

Nickoll (24 Beav. 639) 
Costello's case (2 De G. F. & J. 

302) . . . 800, 825, 826 
Cottam v. Eastern Counties Rail- 
way Co 483 

Cotterell's case . . . 301 790 
Cottle, ex parte . . . 764 766 
Coulson, ex parte . . . 549 

County Life Assurance Co. 155, 158, 167 
County Marine Insurance Co. 

Ranee (6 Ch. 104) 
County Palatine Loan and Dis- 
count Co. 

Cartmell (9 Ch. 691) 
Teasdale (9 Ch. 54) 
Coupland v. Challis . . . 31, 901 
Court Grange Silver Lead Mining 

Sedgwick (2 Jur. N. S. 949) 







Coventry and Dixon's case 


694, 695, 
. . 715 
. 230 
21, 85, 772* 

Cowan's Estate 

Cowie v. Sterling 

Cox's case and Naylor's 

(4 K. & J. 308 and 314) . 
Cox's case (4 De G. J. & Sm. 53) 
59, 96, 802 

(3 De G. and S. 180) . 

Cox v. Midland Counties Railway 

Co. ..... 

Cragg v. Taylor 

Craig v. Phillips . 

Craig's Executor's case 716, 

Cramer v. Bird 

Crampton v. Varna Railway Co 





732, 733 

565, 573 





Crawford v. North-Eastern Rail. 

Co 401 

Crawley's case . . . 14 

Credit Co 343, 658 

Credit Foncier and Mobilier of 

England, ex parte (7 Ch. 161) 

156, 204, 205 

(11 Eq. 356) . . 403, 404 

Cree v. Somervail . . 801, 805 

Crellin v. Brook . . . .271 

v. Calvert 271 

Cremetti v. Crom . . . 697 

Crenver r. Wheal Abraham United 

Mining Co. 

Wilson (8 Ch. 45) 
Creyke's case . . 534, 845 
Crickmer's case . . 
Cridland v. De Mauley 
Crisp v. Bunbury . 
Criterion Gold Mining Co. . 
Cromford and High Peak Co 

Lacey ... 24, 49, 51 
Crook v. Seaford .... 
Crooke's Mining and Smelting Co. 

Oilman (31 Ch. D. 421) 
Crookhaven Mining Co. (3 Eq. 69) 

684, 852, 869, 870, 882, 885 
Cropper, ex parte . 385*, 851, 860 

Crosfield's case 747, 812, 813, 814, 862 
Croskey v. Bank of Wales 407, 568, 593 
Cross v. Law . . . • 286 
Crouch v. Credit Foncier, &c. 230 
Crowe v. Crisford 

Crowley's claim . . . 514 

Crown and Cushion Loan Fund 

Croxton's case (1 De G. M. & G 


(5 De G. & S. 432) . 

Croysdill, ex parte 
Crumlin Viaduct, &c. Co. 669, 706, 720 
Cruse v. Paine . . 505, 510, 805 

Cullen v. O'Meara . . . 1 49 

v. Duke of Queensberry . 247, 272 

v. Thompson ... 88 

Cuming v. Boswell . . . . 545 
dimming r. Prescott . 301, 454, 545, 

Cunliffe, Brooks & Co. v. Black- 
burn Building Society 190, 196, 386 




Cunningham & Co., Limited 

Simpson (36 Ch. D. 532) 
Cunninghame v. City of Glasgow 

Bank .... 758, 801 

Curling r, Flight . . 64, 96, 492 

Currie's case . 301, 395, 785, 789*, 

791, 794, 795, 796* 

Cutteis v. Anchor Insurance Co. . 226, 

Curtis's case (6 Eq. 455) . 591, 749, 

810, 828 
Curzon, ex parte (3 Drew. 508) . 747 
Cutbill v. Kingdom . . 308, 916 

Cutts v. Riddell .... 560 

Da Co^ta v. Russia Co. . . . 604 
Dails v. Lloyd .... 516 
Dale v. Hamilton . . . . 589 

v. Martin . . . 321, 989 

— ex parte (3 De G. & S. 11) . 656 

Dale's case (1 De G. M. & G. 513) 
Dalton v. Midland Railway Co. 

Daly v. Thompson . 

Daly & Co 

Dance v. Girdler 

Daniell v. Royal British Bank 



437, 483 

61, 63 


. 146 


129, 284 

- ex parte (1 De G. & J. 372) 776, 

782*, 789, 805 

Darnell's case (22 Beav. 43) . 518, 782, 

D'Arcy v. Tamar, &c. Railway Co. 158, 
174, 224, 329 
Darlington Banking Co. 

Riches (5 N. R. 287) 
Darlington Forge Co. . 
Davidson v. Bower . 

v. Cooper . 

v. Tullock . 

ex parte (1 Mon. 

Gex, 648) . 

Davidson's case (4 K. & J. 

(3 De G. & Sm. 21) 



. . 269 

268, 269 

88, 91, 496 

& De 

458, 550, 555 

688) . 320 

780, 782, 801, 

803, 805 
Davies v. Hawkins . . 319, 320 

v. London and Provincial 

Marine Insurance Co. . . . 70 
Davies's case (4 De G. F. & J. 78) 769, 

Davis' case (12 Eq. 516) . 189, 385, 516, 

Davis, ex parte (3 Ch. D. 463) 554, 558 

v. Bank of England . . 487 

v. Fisk .... 564 

v. Haycock . . . 506, 510 

Davison v. Gillies . . 432, 597 
Dawes's case . . 664. 843, 878, S89 
Dawkins v. Antrobus . 303, 528, 577 
Dawson v. Malley . . . 715 

v. Morrison . . . . 145 

v. Wrench .... 248 

Day v. Day . .... 544 

ex parte (1 Ch. D. 699) 135, 141 

(3 Jur. N. S. 1016) . . 698, 849 

Dayrell, ex parte . . 852, 858 




Dean v. Bennett . . . 303, 307 

v. Mellaril . . . 263, 915 

Deare v. Soutten . . . 236 

De Bussche v. Alt . . . 377 
De Castro's case . . ■ • 831 
Dee, ex parte . . 620, 641, 647* 

Deffell v. White .... 203 
De Gendra v. Kent . . . 545 

Delta Syndicate 

Forde (30 Ch. D. 153) 
Dendre Valley Railway, &c, Co. 

.Moss (3 De G. & S. 599) 

Denham & Co. . 321, 371, 374, 375, 

376, 518, 696 

Dent's case . . 119, 798, 799 

Dent v. London Tramways Co. . 432, 

436, 597 
Denton v. East Anglian Railway 

Co 222 

v. Great Northern Rail. Co. 88 

v. Macneil . . . . 69 

De Pass's case 468, 800, 825, 826*, 827 
Deposit and General Life Assurance Co. 

Ayre (25 Beav. 513) 
Deposit Life Assurance Co. v. 

Ayscough .... 422 

De Rosaz v. Anglo-Italian Bank . 896 
De Ruvigne's case 367, 696, 789*, 790 
Desinge v. Beare . . . 541 

Devala Provident Gold Mining Co. 156. 
183*, 206 
Devereux v. Kilkenny Railway Co. 292, 


Devon and Somerset Railway Co. 618, 

692, 905, 906 

De Waal v. Adler . . 490, 491 

Diamond Fuel Co. (13 Ch. D. 400) 264, 

626, 632, 633, 634, 645*, 662 

Metcalfe (13 Ch. D. 815) 

Dickinson v. Valpy . . 144, 185 

Dickson's case . . . 748, 749 

Dickson v. Evans . . . 739 

v. Neath and Brecon Railway 

Co 282 

v. Swansea Vale Railway Co. 741 

Diggle v. Higgs . . . .139 

v. London and Blackwall 

Railway Co. . . 221, 225, 227 

Dillon v. Arkins . . . 400, 541 
Dimes v. Scott . ... 543* 
Dimson's Estate Fire Clay Co. . 678 
Direct Birmingham, Oxford, Reading, 
and Brighton Railway Co. 
Amsinck (6 De G. M. & G. 345) 
Best(l Simons, N. S. 193) 
Bright (1 Simons, N. S. 602) 
Capper (1 Simons, N. S. 178) 
Hunter (1 Simons, N. S. 435) 
Onions (1 Simons, N. S. 394) 
Sichell (1 Simons, N. S. 187) 
Spottiswoode (6 De G. M. & G 345) 
Upfill (1 Simons, N. S. 395) 
Direct Exeter, Plymouth, and Devon- 
port Pi ail way Co. 
Besley (2 M. & G. 176) 

(3 M. & G. 287) 

Besly (3 De G. & Sm. 224) 


Direct Exeter, &c, Rail. Co. — cont. 

Hall (3 De G. & Sm. 214) 

Hole (3 DeG. & Sm. 241) 

Mathew (3 De G. & Sm. 234) 

Roberts (2 M. & G. 192) 

(3 De G. & Sm. 205) 

Tanner (5 De G. & Sm. 182) 

Woolmer(5 De G. ,v Sm. 117) 

(2 De G. M. & G. 665) 

Direct London & Exeter Rail. Co. 

D'Urban (18 Jur. 781) 

Hollingsworth (3 De G. & S. 

Osborne (15 Jur. 72) 
Direct London & Manchester Rail. 

Pocock (1 De G. & S. 731) 
Direct London & Portsmouth Rail. 

Goldsmith (14 Jur. 734) 
Direct Shrewsbury & Leicester 
Rail. Co. 

Brittain (1 Sim. N. S. 281). 

Kiddell (1 Sim. N. S. 402) 
Direct Spanish Tel. Co. 
Direct West End and Crovdon Railway 

Lloyd (1 N. S. Simons, 248) 

Studley (14 Jur. 539) 
Disderi & Co. . 786, 789, 796* 

District Bank of London (35 Ch. 
D. 576) ..... 
District Savings Bank . 

Coe (3 De G. F. & J. 335) 
Dixon's case (L. R. 5 H. L. 618) 

521, 842, 845 
Dixon's executors, ex parte (1 Dr. 




& Sm. 225 
Dixon v. Evans 

v. Wrench 

Dobinson v. Hawks 
Dobson, ex parte 
Dodds v. Hills 
Hodgson's case 
Dodgson v. Bell 

v. Scott . 

Doe v. Bold 

v. Jones 

v. Tanniere 

Doman's case . 

752, 758, 812 

842, 845 

. . 461 


. . 551 


. 830, 862 

41, 110, 289 

283, 286-8, 296- 


. . 194 


824, 893 

Dominion of Canada Plumbago Co. 704, 

861, 864, 865 

Donaldson v. Gillot 

Doncaster Permanent 

Society (4 Eq. 579) 

(3 Eq. 158) 

Dornford v. Dornford 

Dosset v. Harding 

Dougan's case 

Douglas v. Horsfall 

Dover and Deal Railway Co. 
Beardshaw (lDr. 226) 
Clifton (5 De G. M. & G. 743) 
Hight (1 Dr. 484) 

Lord Londesborough (4 D. G. M. 411) 
Mowatt & Elliot (3 De G. M. k G. 254} 

476, 487 


. 853, 872, 873, 




58, 129, 295 

774, 775, 891, 892 


670, 671 



Dover, Hastings, &c, Railway Co. 
Carew (7 De G. M. & G. 43) 

Downes v. Ship 

19, 20, 26, 122, 749, 
. 260" 



Dowse's case 

Doyle's case . 

Doyle v. Muntz . 

Drake v. Symes 

Dresser v. Gray . 

Drew v. Nnnn 

Droitwieh Patent Salt Co. 

Curzon .... 
Dronfield Silkstone Coal Co. (17 

Ch. 76) . 334, 395, 402, 520, 526 

(No.2) (23 Ch. D. 511) 703, 861, 

Drouett v. Taylor . . . 35, 145 
Druitt's case .... 691 
Drummond's case (4 Ch. 772). 797, 799 
Drumniond, ex parte ( 2 Gif. 189) 802 
Dry Docks Corporation of London 665, 

681, 699 
Dublin Drapery Co. . . . 203 
Dublin Exhibition Co. . . . 677 
Dublin Grains Co. . . . 686 
Dublin and Wicklow Manure Co. 395, 

Dublin and Wicklow Railway Co. 

v. Black . . . .39, 422 
Ducarrey v. Gill .... 231 
Duce, ex parte . . . . 310 

Duckett v. Gover . . 563, 570 
Duckworth, re . . 557, 743, 754 
Duff's Executors' case . 426, 301, 538, 

Duke's case (1 Ch. D. 620) . 773, 796, 

Duke v. Andrews . . 16, 32, 410 

v. Dive . . 32, 33, 420, 606 

v. Forbes . . 32, 33, 420, 606 

Dura vile v. Birkenhead, &c, Rail- 
way Co 571 

Duncan v. Hill . . 501, 514* 

Duncuft v. Albrecht . . 453, 492 
Dundalk, &c, Railway Co. v. 

Tapster ..... 427 

Dunlop v. Dunlop . . 456, 457, 544 

Dunne v. English . . . . 369 

Dunston v. Imperial Gas Co. . 221, 

308, 366, 388 

Duranty's case . . . . 84 

D' Urban, ex parte . . . 847 

Durham's case . 246, 248, 250, 251, 412 

Durham County Permanent, &c, Society 

Davis (12 Eq. 516) 

Wilson (12 Eq. 516) 

(7 Ch. 45) 

Dutch West India Company (The) 

v. Moses .... 909 
Dutton v. Marsh . . 233*, 243 

Duvergier v. Fellowes . 131, 132*. 139* 
DyneAOr Duffryn Collieries Co. 661, 711 

Eagle Co., ex parte . 166, 169*, 226 
Eaglestield v. Marquis of London- 
derry 242 

Eales v. Cumberland Black Lead 
Co 300 

Eardley v. Law .... 

Earl of Lindsey v. Great Northern 
Railway Co. ... 223 

Earl of Shrewsbury v. North Staf- 
ford Railway Co. 

East and West India Docks Co. 

618, 905 

East and West Junction Railway 

East Botallack Mining Co. . 

Eastern Anglian Railway Co. v. 
Eastern Counties Railway Co. . 

Eastern Counties Junction & South - 
eud Rail. Co. 

Cooke (3 De G. & Sin. 148) 
Mainwaring (2 De G. M. & G. 66) 
Underwood (5 De G. M. & G. 677) 

Eastern Counties Railway Co 






Railway Co. v. 

. 258, 900 

418, 429 

Railway Co. v. 

44, 50, 58, 104-6, 824 

725, 863 

151, 220 

Eastern Union 

v. Symonds 

East Gloucester 

Bartholomew . 
East Holyford Mining Co 
East India Cotton Agency 

Furdoonjee (3 Ch. D. 264) 
East Kongsberg Co. 

Bigg'(l Eq. 309) 
East London Waterworks 

Bailey .... 

East Norfolk Tramways Co. 

Barber (5 Ch. D. 963) 
East of England Banking Co. 
Bugg (2 Dr. & S. 452) 
Feltom's Exors. (1 Eq. 219) 
Pearson (7 Ch. 309) 
East of England Banking Co. 's 

case (5 De G. M. & G. 505) . 426 

(4 Ch. 14) . 

Easton v. London Joint Stock 

Bank ..... 
East Pant Du Mining Co. v. 

Merryweather . . . 309, 573 
East Wheal Martha Mining Co. 61, 124 
Eastwood v. Bain . . 232, 241 
Eaton v. Busker . . . 222, 223 
Ebbett's case . . 39, 810, 829 

Ebbw Vale Co.'s case (5 Ch. 112) 685, 

698, 725 
Ebbw Vale Co.'s claim (8 Eq. 

14) ... . 204, 206, 222 

Ebbw Vale Steel, &c, Co. (4 Ch 

D. 827) .... 
Eberle's Hotels, &c, Co. v. 

Jonas & Bros. 
Ecclesiastical Commissioners 

Merral .... 
Eclipse Gold Mining Co. 
Edger v. Knapp . 
Edie v. The East India Co. 
Edinburgh, fee., Railway Co. 

Hebblewhite . 300, 417, 425, 530, 


Edington v. Fitzmaurice 69*, 72*, 88 









Edmonds V. Blaina Furnaces Co. 




, 296 

Edwards v. Aberayron Society 

v. Barnard . . . . 

r. Buchanan 

V. Cameron's Coalbrook I !o, 

225, 232 : 
'■. Grand Junction Railway 

Co. 150*, 151*, 152*, 153, 258* 

— v. Hall . . . .452 

— v. Kilkenny Railway Co. 46, 59, 

108, 283, 292, 293 

— v. London and North West- 

ern Railway Co. . . 209 

v. Midland Railway Co. . . 210 

v. The Shrewsbury and Birm- 
ingham Railway Co. 577, 579, 600 
Egyptian Commercial and Trading 

Kelson (4 Ch. 125) 
Electric Telegraph Co. of Ireland 397, 
618, 635, 647* 

Budd (30 Beav. 143) 

Bunn (2 De G. F. & J. 275) 

(24 Beav. 137) 

Cookney (2 De G. & J. 170) 

(26 Beav. 6) 

Hoare (30 Beav. 225) 

Maxwell (24 Beav. 321) 

Reid (24 Beav. 318) 

Troup (29 Beav. 353) 
Eley v. Positive Assurance Co. . 148 
Elham Valley Railway Co. 

Dickson's case (12 Ch. D. 298) 
Elkington's case . . . 780, 781 
Elliott's case .... 798 
Elliott v. Richardson . . . 309 
Ellis's case (3 De G. & S. 172) . 847 
Ellis v. Colman . . 201, 357, 5S8 

v. Shinoeck . . 95, 294 

Ellison v. Bignold . . , 131, 575 
Elphinstone (Lord), ex parte . . 732 

(Lord) v. Monkland Iron Co. 732, 

886, 887 
Einly v. Lye 
Emma Silver Mining Co. 

v. Grant . .349 

t>. Lewis 

Emmanuel, ex parte 
Emmerson's case (1 Ch. 433) 


658, 692 

355*, 374 

347, 361* 


. 494, 

836, 837* 


(2 Eq. 236) . 

Emperor Life Assurance Society . 664, 

665, 878, 889 

Empire Corporation (17 W. R. 

431) .... 

Empire Assurance Corporation 

Bagshaw (4 Eq. 341) 

Challis (6 Ch. 266) 

Dousran (8 Ch. 540) 

Leeke (11 Eq. 100) 

Somerville (6 Ch. 266) 
Empress Engineering Co. 
Empson's case 

England (Bank of) v. Johnson 
England (Mayor of the Staple of) 
v. Bank of England . . . 1 


147, 589 

769, 770 


Englefield Colliery Co. 

367, 372, 
377, 696 



English Assurance Co. 

Holdirh (14 Eq. 72) 
English ( liaiinel Steam Co. v. 

Rolt . . . 192, 197, 395 

English and Irish Church and Uni- 

versitv Assurance Society . 656, 737 
Hunt (] Hem. & M. 79) 
English, Irish, &c, Rolling Stock 

Lyon :;"> Beav. 
Yelland (5 De <;. ,v Sm. 395) 
English Joint Stock Bank . 690, 691 
Harding (3 Eq. 341) 
Yelland (4 Eq. 350) 
English aud Scottish Marine Insurance 
Maclure (5 Ch. 737) 
Ennis v. West Clare Railway Co. 112, 
116, 148, 618, 805, 901, 980 
Entwistle v. Davis . . 451, 452 
Era Assurance Society . 176, 184, 200, 
258, 322, 891, 892 
Anchor (2 J. & H. 400) 
AVilliams (2 J. & H. 400) 
Erlanger v. New Sombrero Phos- 
phate Co. . . . 347, 348*, 584 
Ernest v. Croysdill . . 372, 706 

v. Nicholls . 154, 165, 183, 207. 

225, 226, 258, 259, 322, 328, 715, 
891, 892 

v. Weiss . . . . 706 

Esdaile v. Lund . . . 295, 296 

— r. Maclean . . . . 269 

>•. Payne . . . 698, 748 

v. Smith . . . . 287 

v. Trustwell . . 295, 296 

Esgair Mwvn Mining Co. . 746, 748 

Alexander (9 W. R. 410) 
Esparto Trading Co. . 518, 532, 796*, 
797, 839, 843, 845 
Essex Brewery Co. 

Barnett (18 Eq. 507) 
Estates Investment Co. 
Ashley (9 Eq. 263) 
McNeill (10 Eq. 503) 
Pawle (4 Ch. 497) 
Turnley & Oliver (8 Eq. 227) 
Etna Insurance Co. . . 63, 123, 749 
European Assurance Society 
Cocker (3 Ch. D. 1) 
Doman (3 Ch. D. 21) 
Dowse (3 Ch. D. 1) 
Grain (1 Ch. D. 307) 
Harman (1 Ch. D. 326) 
Hort (1 Ch. D. 307) 
Miller (3 Ch. D. 391) 
Ramsay (3 Ch. D. 388) 
Rivington (3 Ch. D. 10) 
European Bank Co. (2 Eq. 521) . 637, 
648*, 659, 661 
Agra Bank (8 Ch. 41) 
Baylis (2 Eq. 521) 
Masters (7 Ch. 292) 
Oriental Commercial Bank (5 Ch. 

c 2 




Corporation (4 




European Bank, ex parte (7 Ch. 


European Central Kail way Co. 
Gustard (8 Eq. 438) 
Holden (8 Eq. 444) 
Oriental Financial 

Ch. D. 33) 
Parsons (8 Eq. 656) 
Sykes (13 Eq. 255) 
European Life Assurance Society 626, 
631*, 632, 649*. 892 
British Nation, &c. , Associa- 
tion (8 Ch. D. 679) 
Arbitration Acts . . 323, 393 
Eustace v. Dublin Trunk Railway 

Co. 61', 65, 107 

Evan v. Corporation of Avon 
Evans' case (2 Ch. 427) . . . 

See also Preece and Evans 
Evans, ex parte (13 Ch. D. 424) . 

(11 Eq. 151) 

v. Coventry . 250, 251, 303, 330, 

372*, 374*, 375, 377, 388, 432, 
520, 583 

v. Hooper . . . . 559 

v. Smalleombe . 178,179,311, 

312, 519, 522, 523, 584*, 822, 838 

v. Wood . 491, 493, 505, 511 

Evens' claim 260* 

Exchange Banking Co. 

Flitcroft (21 Ch. D. 519) 
Exchange Drapery Co. . 455, 736, 870, 

Exeter and Crediton Railway Co. 

v. Buller . 315, 318, 573, 579, 581 
Exeter, Plymouth, & Devonport 
Rail. Co. 

Besley (2 Mc. & G. 176) 
Hall (1 Mc. & G. 307) 
Hole (3 De G. & Sm. 241) 
M.thew (3De G. & Sm. 234) 
Roberts (2 Mc. & G. 192) 
Tanner (5 De G. k Sm. 182) 
Woolmer (2 D. G. M. 665) 
Exhall Coal Mining Co. . 674, 679 

Bleckley (35 Beav. 449) 
Exmouth Docks Co. 278, 618, 625*, 

637, 652 
Eyre's case .... 831, 840 

Factage Parisien Co. . . 641, 650 
Faiititle v. Gilbert . . .163 
Falmouth, Helstou, & Penzance 
Rail. Co. 

Clarke (12 Jur. 471) 
Family Endowment Society 259, 261, 
620, 629, 642, 645, 734 
Farmer v. Giles . . . . 916 

v. Mottram . . . 295 

v. Smith . ... 920 

Farrer v. Close . . . .917 
Faure Electric Accumulator Co. . 364, 
372, 373, 375, 377, 465, 466, 696 
Faviell v. Eastern Counties Rail- 
way Co 221, 265 



Fawcett v. Laurie . 432, 574, 597, 600 

v. Whitehouse . 346, 351, 365 

Fearns v. Young . . . 543 

Fearnside, Dean, and Dobson's case 
Featherstone v. Cooke 
Featherstonhaugh r. Lee Moor 

Porcelain Clay Co. 
Feiling and Eimington's case 393, 402, 

405, 774 
Felgate's case . . 118, 119*, 797* 
Fell v. Burchett . . . 262, 280 
Feltom's Executor's case . 694, 696 
Fenn's case . 94, 95, 524, 621, 840 

Fenn v. Craig . . . 271, 272 
Femiings v. Grenville . . . 319 
Fenwick's case . . 538, 802, 824 
Fenwick v. Wood . . . 493- 

Ferguson v. Wilson . 241, 587, 588 

Fernandes' Executors' case . . 713 
Fernihough v. Leader . . . 560 
Ferraro's case . . . 785, 861 

Fewings, ex parte . . . 725 
Ffooks v. South- Western Railway 

Co 470, 584 

Field v. Lelean . . . . 508 

v. Mackenzie 58, 110, 2S7, 288, 

Fielden v. Lancashire, &c. Rail- 

way Co 596 

Financial Corporation . . 740, 741 
Adams (2 Ch. 714) 
Feiling and Rimington (2 Ch. 714) 
Holmes (2 Ch. 714) 
King (2 Ch. 714) 
Pritchard (2 Ch.' 714) 

v. Lawrence . . . 556, 815 

Finlay v. Bristol Railway Co. 220, 227 
Finlay & Co., ex parte . . 749, 864 
Finlay Hodgson's case, 26 Beav. 

182 799, 804* 

Firbank's Executors v. Humphreys 88, 

241, 243 
Fire Annihilator Co. . 640, 646, 986 
Fisher's case (31 Ch. D. 120) . 778* 
Fisher, ex yarte (3 De G. & S. 116) 623, 


v. Keane . . 303, 528, 577 

v. Taylor . . . 235, 397 

Fishermen of Faversham . . 648* 

Fishmongers' Co. v. Robertson 220, 224 
Flagstaff Silver Mining Co. . 629, 645* 
Flanagan v. Great Western Rail- 
way Co. . . 328, 357, 368, 587 
Fleet v. Murton .... 500 
Fleming's case . . . 260*, 735 
Fleming v. Self . . 916, 920, 921 
Fletcher v. Crosbie . . . . 269 

r. Marshall. . . . 512 

Flitcroft's case . 321, 371, 374, 375, 
432, 695, 696, 697, 744 
Florence Land and Public Works Co. 
Moor (10 Ch. D. 530) 
Nicol (29 Ch. D. 421) 
Tufnell and Ponsonby (29 Ch. D. 
Forbes' case (19 Eq. 353) . 301, 327, 
757, 791, 795 



r wn; 
Forbes' case (8 Oh. 768) . 790, 795 
Forbes and Judd's case (5 Ch. 270) 798 
Forbes v. Marshall . . . 185, 234 
Forde, ex parte .... 784 
Forest, ex parte . . • . 724* 
Forest of Dean Coal Mining Co. 377, 695 
Forrest v. Manchester and Sheffield 

Railway Co. 202, 317, 318, 567, 601 

Forster&Co 730 

Forth Marine Insurance Co. . 912 

Fortune Copper Mining Co. . . 657 
Forwood's claim . . . . 713 
Foss v. Harbottle 173, 300, 304, 346, 
570, 575, 576*, 578, 581, 600 
Foster v. Oxford Rail. Co. . 328*, 368 

v. Wheeler . . . .588 

Fothergill's case . . 783—5, 799 

Fountain's case . 127, 633, 855, 916 

Fountaine v. Carmarthen Railway 

Co. . . . 174, 194, 197, 198 
Fourdrinier, ex parte . . 673, 674 
Fourth City Mutual Benefit Build- 
ing Society v. Williams . . 920 
Fowler's case .... 793, 796* 
Fowler v. Churchill . . 460, 461 

v. Rickerby . . 283, 296, 297 

Fox's case (3 De G. J. & Sm. 465) 46 

(5 Eq. 118) . 123, 521, 777, 842 

Fox, ex parte (17 Q. B. D. 4) . 717 

(6 Ch. 176) 883, 894, 895, 896, 897 

v. Clifton . 19, 21, 144, 393, 410 

v. Frith 66 

France v. Clark . 474, 477, 479*, 480*, 

Frank Mills Mining Co. . 94. 326, 525 


Frankland, re 
Frankly n v. Lamond . 
Fraser v. Cooper, Hall & Co. 

v. Whalley 

Free Fishermen of Faversham 

497, 498 
. 573 
581, 597 
618, 620, 
Freehold and General Investment Co. 

Green (18 Eq. 428) 
Freehold Land and Brickmaking Co. 

Massey (9 Eq. 367) 
Freeman v. Appleyard . . 453 

v. Gainsford . . . 452 

v. Whitbread . . .547 

Fricker's case ..... 691 
Fripp v. Chard Railway Co. . 565 

Frowd's case ... . 84* 

Fry, ex parte . . ■ ■ 714 

v. Russell . . . 129,295 

Furdoonjee's case . . . 557 

Fyfe's case . . . . . 834 
Fyfe v. Swabey . . . 587, 596 
Fyler v. Fyler . . 425, 426, 537 

Galloway's case . . . . 190 
Galvanized Iron Co. v. Westoby 45, 59, 
409, 420, 421 
Gandy v. Gandy . . . .148 

Garden Gully Co. r. McLister 155, 300, 
306, 409, 415, 532, 534, 843 
Gardner v. London, Chatham and 

Dover Railway Co. . . 195*, 197 

Garfit's case . . ... 
Garnet and Moseley Gold Mining 

Co. v. Sutton . 273, 742, 855, 885 
Garrard v. Hardey . . . . 133 
Garrick v. Taylor . . . 539 

Garstin's case .... 710, 825 
Gartness Iron Co. 

Elphinstone, Lord (10 Eq. 412) 
Gartside v. Silkstone, &c. Iron Co. 197 
Garwood v. Ede . . . .33* 

Gaskell v. Chambers . . . 367* 
Gas Light Improvement Co. v. 

Terrell 669 

Gaudet Freres Steamship Co. 710, 882 
Gay's case . . 847, 852, 865, 866 
General Co. for the Promotion of 

Land Credit 116, 468, 619, 622, 636, 

645*, 801 

General Discount Co. v. Stokes 555, 

556, 884 
General Estates Co. 

City Bank (3 Ch. 758) 
Hastie (4 Ch. 274) 

(7 Eq. 3) 

Wright & Gamble (8 Eq. 123) 
General Exchange Bank 712, 743, 859, 

Lewis (6 Ch. 818) 

v. Homer . . 367, 374, 376 

General Financial Bank . 660, 686, 701 
General Floating Dock Co. . . 834 
General International Agency Co. 

640, 651*, 659 
Chapman (2 Eq. 567) 
General Mining Co. . . . 402 

General Provident Assurance Co. 
Bridger (5 Ch. 305) 

(9 Eq. 74) 

National Bank (14 Eq. 507) 
General Rolling Stock Co. 636, 637, 645* 
Alliance Bank (4 Ch. 423) 
Chapman (1 Eq. 346) 
Joint Stock Discount Co. (7 Ch. 
General Share Co. v. Wetley 

Pottery Co. 
General South American Co. 

Yglesias & Co. (10 Ch. 63 
General Steam Navigation Co 

Guillan . 
General Works Co. 

Gill (12 Ch. D. 755) 
Genesee Mutual Insurance Co 

Gerhard v. Bates 
German Date Coffee Co. . 

303, 727 


German Mining Co. . 236*, 


. 19, 88 

. 633, 641, 


381, 387*, 


Chippendale (4 De G. M. & G. 14) 
Stone (3 De G. & Sm. 120) 
Gibbs and West's case 191, 192, 667, 

742, 744 

Giblin v. McMullen . . . 209 

Gibraltar and Malta Bank . .640 

Gibson's case (2 De G. & J. 275) 83*, 

86, 206, S60, 862 



Gibson, ex parte (4 Ch. 662) 261, 734 

re (2 Eq. 669) . . .541 

v. Barton 126, 335, 340, 940, 946 

v. The East India Co. . . 221 

Gibson & Co. (5 L. R. Ir. 139) 736, 783, 

784, 852 
Gilbert v. Cooper 183, 323, 59S, 892 

Gilbert's case . 377*, 394, 412, 465, 
466, 748, 825, 829, 884 
Gilbertson v. Fergusson . . 911 
Giles v. Cornfoot . . . . 145 

v. Hutt . . . 425, 530 

v. Smith . . . . 247 

v. The Taff Railway Co. 160*, 209. 

Gill y. Continental Union Gas Co. 461 
< rill's case .... 742, 858 
Gillan v. Morrison . . . 386* 
( rillespie v. City of Glasgow Rank 801 

In re . 


Gilman's case 


Ginger's case 


*, 80 

Glaholme's case . 


Glamorganshire Ranking Co. 

Morgan (28 Ch. D. 620) 

Glanville's case 



Glassington v. Thwaites 


Gleadow v. Hull Glass Co. 


Gledhill's case 



Gledstanes & Co.'s case . 



Globe New Patent Iron, &c, Co. 



Glossop v. Keston Local Board 


Gloucester, Aberystwith, &c, Rail. 




Maitland (4 De G. M. & 


769) _ 

Glover v. Giles 



Goddard v. Hodges 



Golf v. Great Northern Railway 

Co 160, 209 

Gold Co. (11 Ch. D. 701) . 640, 651*, 


(12 Ch. D. 77) . 689, 690, 881, 


Gold Hill Mines . 624, 637, 64S*, 657 

Goldsmid's case (16 Beav. 262) . 21, 

772*, 845 

Goldsmith, ex parte (14 Jur. 734) 639, 

Goochs case (7 Ch. 207) . 692, 705 

(8 Ch. 266) . . 811, 828, 829 

(W. N. 1872, p. 227) . . 820 

Gooch v. London Banking Associa- 
tion . . . 732, 867, 886 
Gooday v. Colchester Railway Co. 220 
Goodwin v. Francis . . . 241 

v. Robarts . . 67, 474, 740 

Gordon's case ... . . 758, 824 
Gordon v. Pym .... 272 
v. Sea, Fire and Life Assur- 
ance Co. . . . .185, 226 
Gore and Durant's case . 727, 780 
Gorgier v. Morris . . . . 606 
Gorringe v. Irwell India-Rubber, 

&c, Works . 668. 669, 706, 720 
Gorrissen's case . . . . 769 


Gouthwaite's case . 257, 288, 751, 812, 

814, 817 
Gover's case . . 92, 346, 347 

Government of Newfoundland v. 

Newfoundland Railway Co. 276, 740 
Government Security Fire Insur- 
ance Co. ..... 

Mudford (14 Ch. D. 634) 
White (12 Ch. D. 511) 

(10 Ch. D. 720) 

Gow v. Forster .... 545 
Gower's case . . . 532, 845, 860 
Grady's case . 52, 178, 313, 830, 

840, 841, 844 
Graham v. Birkenhead, &c, Rail- 
way Co. . . . . 583* 

■ v. Connell . . . .462 

■ v. Edge . . . 683, 707, 985 

v. Van Diemen's Land Co. . 308, 

532, 551, 552 
Grain's case . . . 251, 260* 

Grand Junction Canal Co. v. Petty 163, 

Grand Trunk Rail. Co. 

Apps (18 L. J. Ch. 409) 

v. Brodie . . 705, 712, 863 

Grant, ex parte . . . . 501 
v. United Kingdom Switch- 
back Railway Co. . 177, 178, 179 
Gray's case .... 805, 806 
Gray v. Chaplin . . . 565, 582* 
- v. Lewis . 200, 205, 372, 563, 570 
. 270, 559 



139, 722 

v. Pearson 

v. Raper 

v. Seckliam . 

Grayburn v. Clarksou . 

Great Australian Gold Mining 

Appleyard(18Ch. D.587) 

Great Berlin Steamboat Co. 

Great Britain Mutual Life Assur 

ance Society (20 Ch. D. 351) . 621, 

635, 648*, 738, 1098 

(16 Ch. D. 246) . . 634, 635, 

663, 738, 752, 757 
Great Cambrian Mining and 
Quarrying Co. 

Hawkins (2 K. & J. 253) 
Great Eastern and Western Rail- 
way Co., re .... 
Great Luxembourg Railway Co. v. 

Magnay . . . 357, 360 L 
Great Monster Railway Co. 

Inderwick (3 De G. & Sm. 231) 
Great Northern and Midland Coal 

Currie (3 De G. J. & S. 367) 
Great Northern Railway Co. v. 

Eastern Counties Railway Co. . 892 

v. Kennedy . . . 425, 530 

— — v. Tahourdiu . . 278, 618 
Great North of England Railway 

Co. v. Biddulph . . . 416, 419 
Great North of England, York- 
shire, &c, Union Railway Co. 
Carrick (1 Simons, N. S. 505) 
Great Oceanic Telegraph Co. 
Harward (13 Eq. 30) 





Great Ship Company 

Parrs (' De G - J - & lS - 63 > 
Great Western Extension Atmo- 
Bpheric Railway Co. 

Wryghte(2 De G. M. & G. 
Great Western Forest of Dean Coal 
Consumers' Co. (21 Ch. D. 769) 

636, 652* 
Carter (31 Ch. D. 496) 
Great Western Railway Co. v. 

Wake .... 200 

v. Metropolitan Railway Co. 43 

v. Rushout . . 318, 598, 601 

Great Western Railway of Bengal 

James (4 De G. & Sm. 183) 
Quilter (4 Ik- G. & Sin. 183) 
Wolesey (3 De G. & Sm. 101) 
Great Western, Southern and 
Eastern Counties Railway Co. 
Holinsworth (3 De G. & Sm. 7) 
Great Wheal Busy Mining Co. 

King (6 Ch. 196) 
Green's case (18 Eq. 428) . . 793 
Green, ex parte (1 Jur. N. S. 33) . 698 

(12 Jur. 534) . . . 901 

v. Barrett .... 593 

v. Britten . . . . 543 

v. London General Omnibus 

Co 209 

v. Murray . . . . 498 

v. Nixon* . 282, 283, 295, 560 

Greenhalgh v. Manchester and 

Birmingham Railway Co. . . 151 
Greening & Co. 

Marsh (13 Eq. 28S) 
Greenshield's case . . 556, 608 
Greenwood's case (3 De G. M. & 

G. 459) . . . 165, 246, 847 
Greenwood, ex parte (9 Ch. 511 . 667 

(9 Jur. N. S. 997) . . 725 

Gregg's case ..... 800 
Gregory v. Patchett . 317, 322, 430, 
579, 583, 584 

v. Williams . 

Gresham Life Assurance Society 

Penney (8 Ch. 446) 
Grey's Brewery Co. 
Grey's case .... 
Griffin v. Beverley 
Griffith's case 
Griffith v. Paget . 


Grimes v. Harrison 
Grimwade, ex parte 

v. Mutual Society 

Grisewood v. Blane 
Grisewood's case . 66 

. 691 

. . 746 


. 260, 734 

321, 433, 868, 


. 371*, 372 

. . 848 


Grissell's case (1 Ch. 52S) 

133, 464, 468, 
487, 619, 799 
. 666, 672, 
736. 742* 
Grissell, ex parte (3 Ch. D. 411) . 716, 


v. Bristowe . . 501, 504*, 510 

Groux's Soap Co. v. Cooper 
Groyes v. Groves 


Guardian Permanent Building 

Society . . . . 87, 189 

Guest, ex parte ' . 639,651* 

v. Worcester Railway Co. . 292, 

395, 787 
Guillemin, ex parte . . 667, 717 
Guiness v. Harrison . . . 92<> 

Guinness v. Land Corporation of 

Ireland . 11'.', 321, 334, 396, 432, 
571, 597 
Gunn's case . . . 14, 769 

Gunn v. London and Lancashire 

Fire Insurance Co. . . 148, 149 

Gurney v. Rawlins 


Custard's case 

16, 47ii, 762, 770 

Guthrie, ex parte 

. 267 

v. Fisk . 

. . 267 

v. Walrond 

. 541 

Gwyn, ex parte (1 Jur. 

N. S. 300) 714, 


Habershox's case (5 Eq. 287; . 669, 

743, 744 
Hack v. London Building Society 921 
Haddon v. Ayres . 201, 243, 522 

Haford Lead Mining Co. 

Slater (35 Beav. 391) 
Hagell v. Currie . . . 372, 675 
Hague v. Daudcsun . . 456, 458 

Haigh v. North Bierly Union 221, 265 
Hakim's case .... 825 
Halford v. Cameron's Coalbrooke, 

&c, Co. . . . 186, 225, 232 
Halket v. The Merchant Traders' 

Loan Association 246, 248, 250, 285 

Hall's case (5 Ch. 707) . 520, 532, 797, 

839, 840, 845 

(3 De G. & S. 80) . . 749 

(3 De G. & S. 214) . 765, 766 

Hall, ex parte (Mon. & Ch. 365) . 550 

(3 Deac. 405) . . .565 

(1 Mac. & G. 315) . . . 750 

— (1 Mac. & G. 307, and 3 De 

G. & Sm. 80) . . . 802 

— (1 De G. M. & G. 1) . . 860 
— , re William (2 Dr. k Sm. 

284) .... 

— r. Bainbridge 

— v. Connell 

— v. Mayor of Swansea . 
— - v. Old Talargoch, &c, Co 
ilall& Co., Limited (A. W.) 

. 697 

240, 270 




396, 787 

248, 251 

Hallett v. Dowdall . 246, 247 

Hallmark's case . 59, 376, 518, 769, 

791, 795* 

Hallows v. Fernie . 21, 69, 71, 568, 

569, 593 
Haly v. Barry . . . . 461 

Hambro' v. Hull, &c, Insurance 

Co. . . . 162, 171, 201, 226 

Hamer's Devisee's case . 812,813,814 

Hamer v. Giles .... 678 

Hamilton v. Smith . . 144, 764 

127 ' Hamilton's case, Lord Claud 300, 301, 

140 790, 795* 




Hamilton's Windsor Ironworks 

Pitman & Edwards (12 Ch. D. 707) 
Hamley's case . . 791, 793, 795 

Hammersmith Town Hall Co. . 700 
Hampden v. Walsh . . . 139 

Hampson v. Price's Patent Candle 


Hancock v. Hodgson 
Handley v. Farmer 
Hanken v. Bourne . 
Hankey, ex parte 
Hannuic v. Goldner 
Harben v. Phillips . 

318, 599 
210, 248* 
. . 192 
. 710 
. 498 
157, 175, 310, 567, 
573, 599, 600 
Harding, ex parte (3 Eq. 341) 729*, 731 
Hardinge, ex parte (1 N. R. 40) . 859 

v. Webster . 259, 282, 456, 563. 

Hardy v. Fothergill 554, 719, 732, 816 

v. Metropolitan Land, &c, 

Co 372 

Hare's case . 26, 27, 53, 773, 775* 
Hare v. London and North- West- 
ern Railway Co. . 54, 60, 63, 
108, 567, 571, 601 

v. Waring . . .64, 492 

Harford v. Amicable, &c, Asso. 

Co 673 

Hargrove, exparte . 115, 135, 621, 622, 

662, 722 
Harman's case . . . . 260* 

Harmony and Montagu Tin and 
Copper Mining Co. 
Spargo (8 Ch. 407) 
Harris's case (7 Ch. 587). 14, 16, 770 
Harris, re (15 Ch. D. 561) . . 451 

i;. Amery . . 114, 135, 450 

v. North Devon Railway Co. 377, 

520, 532, 600 

v. The Royal British Bank . 282 

Harrison's ease (6 Ch. 286) . 768, 824, 


(3 Ch. 633) .... 779 

Harrison, exparte (28 Ch. D. 363) 468, 

538, 552 
v. Brown . . . . 564 

- — v. Heathorn . . 132, 133* 
v. Mexican Railway Co. . 322, 

334, 344, 396, 405 

v. Stewardson 

r. Timmins 

v. Tysan 

Hart's case 

Hart v. Clarke 95 

v. Frontino 

Mining Co. . 
Hartas v. Ribbons 
Hartley's case 
Hartley v. Allen 
Hartridge, ex parte 
Harvey v. Beckwith 

«. C lough . 

r. Collett 

— v. Kay 
v. Scott 

Harward's case 

278, 279 
. . 286 
121, 123, 810, 828 
528, 529, 534*, 582 
and Bolivia 
54, 60, 63, 64, 484 
. 63, 123, 125, 842 
. . 547 
. . 566 
. 95, 97, 127, 683 
. 139, 565 
58, 60, 110, 283, 287, 
288, 295 
. 15, 761, 796* 

Harwood v. Law .... 285 
Hassell v. Merchant Traders' Loan 

and Insurance Association . 248, 250 
Hastie's case . . 556, 815, 848 
Hatcher, exparte . 42, 808, 809, 848 

322, 598, 

600, 601, 892 

380) . 825, 



311, 633,641, 


Hawken v. Bourne . . . 159, 205 
Hawkins' case (2 K. & J. 253) 95, 761 

(23 Ch. D. 452) . . .919 

Hawkins, ex parte (3 Ch. 787) 678, 694 

v. Maltby . . 493, 502, 505, 

506, 510, 511 
Hawtayne v. Bourne . . . 192 
Hawthorn's case (1 De G. & S. 

571, and 1 Mac. & G. 49) 817, 818 

Hattersley v. Shelburne 

Hatton's case (8 Jur. N. S. 

— - (10 W. R. 313) . 
Haven Gold Mining Co. 

(10 W. R. 572) . 


Hay's case . . 368, 786, 797, 


Hay v. Willoughby . . . it 

, 47 

Hayes v. Stirling . . . . 


Hayman v. Governor of Rugby 

School . . . . . 


Hayter v. Tucker . . 452, 


Haytor Granite Co. . . 731, 


Head's case . . . 833, 


Healey v. Chichester and Mid- 

hurst Railway Co. 281, 292, 

v. Story .... 226, 232 

Heathcote v. North Staffordshire 

Railway Co 324 

Heaton's Steel and Iron Co. 
Blyth (4 Ch. D. 140) 
Simpson (9 Eq. 91) 
Hebb's case ... 13, 14, 841 
Heirs Hiddingh (The) v. De Vil- 

liers Denyssen. . . . 547 
Heirons case . 690, 691, 692, 881, 967 
Helbert r. Banner (or Helbert's 

case) . 824, 846, 847, 850, 851, 856 
Helby's case . . 816, 822, 830* 

Hemming v. Maddick . . . 806 
Henderson's case . 759, 832, 841* 

Henderson v. The Australian Royal 
Mail Steam Navigation 

Bank of Australasia 


v. Gilchrist 

v. Lacon 

v. Ro} r al British Bank 5' 

i\ Sanderson . 

Hendriks v. Montagu . 
Henessy's case . . 521 
Henley & Co 
Hennell v. Strong . 
Henry's case (2 Ch. 431) . 
Henry v. Great Northern Railway 

Co. . . . 401, 571, 580, 597 
Heraud v. Leaf . . .143, 244 
Hercules Insurance Co. (Ir. Rep. 

6 Eq, 207) .... 697 


537, 812 
. 76* 

129, 284 

802, 829 

673, 717 



Hercules Insurance Co. (11 Eq. 
321) 707 

Bninton (19 Eq. 302) 

Lowe (it Eq. 589) 

Pugh and 8hannan (18 Eq. 566) 
Hereford and MerfhyrTydviL &c, 
EaiL Co. 

Maitland (3 GifF. 28) 
Hereford and South Wales Wag- 
gon, &c, Co. (17 Eq. 423) 

(2 Ch. 1). 621) 

Herefordshire Banking Co. . 

Buhner (33 Beav. 435) 
Heritage's case (9 Eq. 5) 
Heritage, re (Kay, -\j>i>. 29 

v. Paine 

Herman v. Jenchner 
Herraann Loog, Limited 
Heme Bay Pier Co. 

Burge (1 De G. & Sm. 
Heme Bay Waterworks Co 
Hesketh's case . 
Hespeler's case 
Hester & Co. , Limited 
Heward v. Wheatley . 
Hewitt's case 
Hewitt v. Price 
Heyford Ironworks Co. 

Forbes and Judd (5 Ch. 270) 

Pell (5 Ch. 11) 
Heymann v. European Central 

Railway Co. . . . . 70 

Hibblewhite ». McMorine . 472, 488 
Hicheus v. Congreve . 346, 351*, 365, 
561, 564, 566 
Hickie & Co. s case . . . 727 

Higgs's case . 46, 62, 122, 184, 208, 
891, 896, 897 
Higgs v. Northern Assam Tea Co. 741 
Higgins, ex parte . . 714, 723 

v. Hopkins . . . 145, 247 

Hight, ex parte .... 766 
Hildyard v. The South Sea Co. . 483 
Hill's case (9 Eq. 605) . 189 ; 




10, 821 




625*, 648* 

842, 845, 856 

. . 788 

. 894 

426, 537, 540 

792, 793, 795* 

. . 4S8 

Janet (4 App. Ca. 562) 

(20 Eq. 585 and 595) . 

Hill v. Bridges 

v. East and West India Docks 


London and County As- 

235, 385, 
810, 835 
538, 812 
721, 732 


surance Society 
v. Manchester and 

Waterworks Co. 
Hill Pottery Co. . 
Hilton v. Eckersley 

- v. Giraud 

Hippisley's case 

Hire Purchase Co. v. Richens 

670, 671 

. 168% 312 

. . 677 

. 917 

. . 452 

53, 736, 775 



Hirschel, ex parte (15 Jur. 942) . 
Hirtzel, ex parte (2 De G. F. & J. 

653) 616 

Hitchcock's case .... 862 

Hitchins v. Kilkenny Railway Co. 146, 

291, 292, 294 

Hoare's case (30 Beav. 225) . . 383* 

Hoare's case (2 J. & H. 229) 

(10 W. It. 381) 

Hobbs c. Wayet 
Hodge, re 

Hodge's Distillery Co. 
Maude (6 Ch. 51) 
Hodgkinson v. Kelly 



. . 864 

539, 589, 805 

. . 262 

491, m 





675, 726 

. 836 

. 733 


765*, 862 

594, 921 

— r. National Life Stock Insur- 
ance Co. . 322, 328, 520, 573, 
577, 596 
Hodgsou v. I'ij wis . 
Hodsell, ex parte 
Hodson v. Tea Company 197, 
Holden's case .... 
Holdich's case 
llnldsworth v. Davenport 
Hole's case . 
Holgate i>. Shutt 
Holinsworth, ex parte (3 De G. & 

S. 7) . . 623, 626, 627, 646* 
Holland v. Dickson . 314,333,440, 
567, 599, 604 
Hollinsworth's cn«p '3 De G. & S. 

102) 694 

Hollwey's case . . . 522, 841 
Hollyford Copper .Mining Co (5 

Ch. 93) 697 

(Ir. L. R. 3 Eq. 208) . 853, 869 

(Ir. Rep. 1 Eq. 39). . . 783 

Holmes' case (2 De G. M. & G. 

113) . 594, 818, 823, 830*, 861 
Holmes's, Pritchard's, and Adam's 

cases (2 Ch. 714) . . . 774 

Holmes v. Binney . . . 268 

v. Higgins . . 143, 363,;606 

v. Newcastle, &c. , Abattoir 

Co. . . 321, 432 

v. Symons . 505, 511, 554, 556 

Holroyd, ex parte . . . 698, 849 
Holt's" case (22 Beav. 48) 82*, 156, 206 

(1 Sim. K S. 389) . 518, 838, 862 

Home Assurance Association . 636, 
645*, 659, 661 
Richards 'case (L. R. 6 C. P. 591) 
Home Investment Society . 861, 865 
Homer District Consolidated Gold 

Smith (39 Ch. D. 546) 
Homersham r. Wolverhampton 

Waterworks Co.. . 221,225, 227, 

Hone v. O'Flahertie . . . 
Hoole v. Great Western Railway 
Co. . 396, 431, 432, 436, 565, 
573, 574, 580, 
Hop and Malt Exchange Co. 650*, 
Hope v. Croydon, &c, Trams Co. 

v. International Financial 

Society . 322, 334, 402, 450, 

528, 530, 571, 599, 840 
Hope Mutual Life Assurance Co. 638. 




Hopkins' case (4 De G. J. & S;u. 

342) .... 698. 

Hopkins' trust (18 Eq. 636) 
Hopkinson v. Marquis of Exeter 







202, 732 

247, 254 

251, 260* 


Hopkinson's and Underwood's 

cases .... 148, 850 
Horbury Bridge Coal, kc, Co. 308, 311 
Horn v. Kilkenny, &c, Railway 


Hornby v. Close . . . . 

Home and Hellard, in re 

Horsey "s case (2 Eq. 167) 

Horsey's claim (5 Eq. 562) 

Horsley v. Bell 

Hort's case 

Houldsworth v. City of Glasgow 

Bank . 74,' 216, 217, 736, 754* 

v. Evans . 179, 312, 520, 522, 

523, 838, 845 
Houriet v. Mori is ... 37 

Household Fire Insurance Co. v. 

Grant 14 

Howard's case (1 Ch. 561) . 17, 156, 
771, 781* 
Hew aid and Dollman's case (1 

Hem. & M. 433) . . . 723 
Howard v. Patent Ivory Manu- 
facturing Co. . 147,176,177*, 
192, 193,197 

v. Shaw . . . . 284 

Howbeach Coal Co. v. Teague . 157, 
158, 300, 305, 309, 319, 336, 
409, 411 
Hoylake Railway Co. 

Littledale (9 Ch. 257) 
Hubbersty u. Manchester, 

field, &c, Railway Co. 
Huckle v. Wilson 
Huddleston v. Gouldsbury 
Hudson's case (2 De G. & J. 275) 

(12 Eq. 1) . 

Hudson v. Revett . . . . 
Hue, ex parte .... 
Hughes's case (1 De G. & £m. 606) 

(15 W. R. 476) . 

claim (13 Eq. 623) . 725 

Hughes, ex parte (4 Ch. D. 34, n.) 

v. Thorpe . . 137, 561, 565 

Hughes-Hallett v. Indian Mam- 
moth Gold Mining Co. . 589, 805 
Hulett's case . .180, 224, 741 
Hull, Bamsley, &c, Railway Co. 195, 


Central Drapery Co. . 676, 859 

and County Bank . . 659 

Flax Co. v. Wellesley . 53, 263, 

407, 421, 884 
Forge Co 698 

and London Fire and Life 

Insurance Co. 

Gibson (2 DeG. &J.275) 

Hudson (2 De G. & J. 275) 

Kemp (2 De G. k J. 275) 

Humber Iron Works, kc, Co. 

(2 Eq. 15) . . 658, 659, 660 

^8 Eq. 122) . . . 723 

Warrant Finance Co. (5 
Ch. 88) 

(4 Ch. 643) 

William's case (1 Ch. D. 


. 458, 466 

. 916 

. 450, 541 









Humble v. Langston 

v. Mitchell 

Humby's case 

Hunt's case (32 Beav. 387) 

■ (1 Hem. & M. 79^ 

Hunt v. Gunn 

v. Hibbs . 

■ v. Wimbledon Local Board . 

Hunter's case (1 Sim. N. S. 435) . 


423, 472, 493, 

495, 506, 510 

. . 453 

47, 831 

518, 584, 

822, 838 

732, 734 

449, 490 

. 173 



861, 866 
Hunter, re (L. R. 8 C. P. 24) . 715 

v. Stewart . . . 584, 913 

Hutchinson's case (1 De G. & S. 

563) 746 

Hutchinson, re (16 Q. B. D. 515} 461 

v. Harding . . . 670 

v. Surrey Gas Co. . . 148 

Hutt v. Giles 411 

Hutton v. Scarborough Cliii' Co. . 322, 
334, 343, 396, 405, 597 

v. Thompson . 144, 764, 766 

v. Uptill . . . .16, 764 

v. West Cork Railway Co. . 318, 

366, 389, 599 
Hvam's case . . 800, 825*, 826* 
Hybart v. Parker . . 95, 270, 559 

Ibbotsox v. Elam 

I. H., re (Ir. Rep. 3 Eq. 245) 

Ilfracombe Railway Co. V. Devon 

and Somerset Railway Co 







, 897 

v. Lord Poltimore 

Imperial Bank of China and Japan 

642, 651*, 653*, 
— — Bank of China, kc v. Bank 

of Hindustan . 176, 208, 
264. 307, 891, 894, 895 
Continental Water Corpora- 
tion . . . 689, 691, 692 

Guardian Life Assurance 

Society .... 652* 

Hydropathic Hotel Co. v. 

Hampson 302, 344, 573, 600 

Land Co. of Marseilles 

Colborne and Strawbridge 

(11 Eq. 478) 
Harris (7 Ch. 587) 
Jeaffreson (11 Eq. 109) 
Larking (4 Ch. D. 566) 
National Bank (10 Eq. 

Townsend (13 Eq. 148) 
Yining (6 Ch. 96) 
Wall (15 Eq. 18) 

Mercantile Credit Association 

(12 Eq. 504) . 712, 883, 889, 
894, 896, 897, 898 
(5 Eq. 264) . . . ("693 
(W. N. 1866, 257) . 643, 659 
Chapman and Barkers (3 

Eq. 361) 
Clements (13 Eq. 178 n.) 



Imperial Mercantile Credit Assoc. — cont. 
Coleman (1 De G. J. & 

Sin. 495) 
Curtis (6 Eq. 455) 
Doyle (2 H. & J. 221) 
Marino (2 Ch. 596) 
Payne (9 Eq. 223) 
Richardson (19 Eq. 588) 

v. Coleman . 367, 369*, 378, 389 

Rubber Co. 

Bush (9 Ch. 554; 

Salt and Alkali Co. 

Slatter's executors (5 De 
G. & Sm. 34 & 1 D. G. 
M 64) 

Wine Co. 

Shirreff (14 Eq. 417) 
Incc Hall Rolling Mills Co. . . 334, 
396, 401, 787 

v. Douglas Forge Co. . . 739 

Inchbald v. Western Neilgherry 

Coffee Co. 729, 883 

Ind's case . . . .50, 401 
Independent Assurance Co. 
Bird (1 Simons, N. S. 47) 
Cope (1 Simons, N. S. 54) 
Holt (1 Simons, N. S. 389) 
Terrell (2 Simons, N. S. 126) 
Inderwick v. Snell . 302, 577, 579, 600 

exparte . . . . 651* 

India and Australia Mail Steam 

Packet Co. . . 670 

Maudslay and Field (17 
Simons, 157) 
India and London Life Assurance 

Co 261 

Indian Zoedone Co. . 309, 310, 341, 

878, 879 
Ingate v. Lloyd Austriaco . . 264 
Inglis v. Great Northern Railway 

Co. . . 106, 313, 425, 530 

Inman v. Clare . . . .727 
Inns of Court Hotel Co. . 192, 669, 874, 

International Contract Co. . . 702 
Hughes (13 Eq. 623) 
Ind (7 Ch. 485) 
Levita (3 Ch. 36 & 5 Ch. 

Pickering (6 Ch. 525) 
International Life Assurance Society 

(9 Eq.316) .... 260* 

(2 Ch. D.) ... 737 

Blood (9 Eq. 316) 
Gibbs and West (10 Eq. 

Mclver (5 Ch. 424) 
International Marine Hydropathic 

Co 470, 682 

v. Hawes .... 848 

International Pulp and Paper Co. 674, 

Knowles (6 Ch. D. 556) 
Inventors' Association . 638, 652, 657 
Ipswich, Norwich and Yarmouth 
Railway Co. 

Barnet (1 De G. k Sm. 744) 

Ireland (Bank of) v. Trustees of 

Evans* Charities . . . . 224 
Irish Lands Improvement Society 

Fry (1 Dr. & Sm. 318) 
Irish Peat Co. v. Phillips . 45, 50, 59, 
105, 108, 421 
Irish West Coast Railway Co. 

Carmichael (17 Simons, 163) 
Iron Shipbuilding Co. 
Iron Ship Coating Co. v. Blunt . 




632, 642, 651 

Irrigation Co. of Franco 

Fox (6 Ch. 176) 

Irvine v. Union Bank of Australia 165, 

168, 171, 176, 177, 178, 179*, 191, 

197, 312 

Irving v. Houstoun . . . 545 

Isle of Wight Ferry Co. . 618,636, 

Isle of Wight Railway Co. v. 

Tahourdin . 302, 304, 305, 306, 327, 

332, 578, 599, 602 

Ives, re . . 451, 467, 469 

Jackson v. Cocker 
— - v. Minister Bank 

06, 473, 199 
304, 377, 
578, 599 

v. North Wales Railway Co. 222 

v. Petrie . . . 848 

- — ■ v. Turquand . 16, 770, 824 

Jacques v. Chambers . . . 544 

James, exparte (8 Eq. 225] . . 738 

- (1 Sim. N. S. 140) . 623, 649* 

v. Eve . . . . 299, 432 

■ v. May . . 804, 805, 879 

Jarrett v. Kennedy . - . . 34 

Jeaffreson, ex parte . . 786, 861 
Jefferys v. Gurr . . 46, 220, 464 

v. Smith . . . .608 

Jegon, exparte . . . . 436 
Jenkins v. Hutchinson . . 241 

Jenkinson v. Brandley Mining Co. 198 
Jenner v. Morris . . . . 236 
Jenner's case . . . 793, 795 
Jennings, re (1 Ir. Ch. 236 & 654) 418, 


v. Baddeley . . . . 397 

v. Broughton . 19, 72, 77* 

v. Hammond . .115, 135, 141 

Jervis v. Lawrence . . . 451 
Jessopp's case . . . 522, 830, 841 

Job, re 847 

Johnson, exparte (27 L. J. Ch. 803) 388 

(1 Jur.N.S.913) . . . 693 

v. Goslett . . . 30, 31 

v. Lyttle's Iron Agency Co. 531, 

532, 597 
Johnston's claim . . 209, 716 

Johnston v. Renton . 483, 486, 487 

Joint Stock Coal Co. . 633, 634, 643, 650 
Joint Stock Discount Co. 

Fyfe (4 Ch. 768) 

Hill (4 Ch. 769 n.) 

Loder (6 Eq. 491) 

Nation (3 Eq. 77) 

Reid (24 Beav. 318) 



Joint Stock Discount Co. — cont. 
Shepherd (2 Eq. 564) 

(2 Ch. 16) 

Shipman (5 Eq. 219) 
Sichell (3 Ch. 119) 
Warrant Finance Co. (10 
Eq. 113 & 5 Ch. 86) 
— v. Brown . 318, 371, 375, 376, 450 
Joint Stock Discount Co.'s claim 

(7 Ch. 646) . . . 723, 724 

Jones' case (6 Ch. 48) . . . 799 
Jones, ex parte (27 L. J. Ch. 666) 801 

v. Charlemont . . 610, 901 

v. Garcia del Rio . . 568 

— — v. Harrison . . . . 33* 

v. Ogle . . . .10, 547 

v. Rose .... 569 

v. Scottish Accident Insur- 
ance Co. . . 38, 911, 912 

v. Victoria Graving Dock . 228 

v. Williams . . .721 

v. Yates .... 713 

Jopp's case 849 

Josephs v. Pebrer . . 131*, 132*, 

140, 487, 516 

Joy v. Campbell . . . . 551 

Jury v. Stoker . . . . 88, 92 

Karuth's case 
Kay v. Johnson 
Kearns v. Leaf 

792, 793' 



166, 184, 249, 598, 


Keasley v. Codd . . . . 245 

Keene's executors' case . 315, 316, 

542, 758, 812, 831, 862, 893 

Kelk's case . 528, 530, 800, 819, 843 

Kellock's case 
Kellock v. Euthoven 

Kelly's executors, ex parte 
Kelner v. Baxter . 
Kelsall v. Marshall 101, 

v. Tyler . 

Kemp's case 
Kempson v. Saunder; 

685, 716, 720 

493, 506, 

510, 710, 821 

. 748 

. 149, 243 

266, 910, 913 

. . 916 


131, 141, 494* 



. . 831 

Kendall v. King . 
Kennedy, ex parte . 
— — v. Panama, &c. Mail Co. . 76, 590 
Kensington Station Act 147, - J47, 904 
Kent's case . . 428, 668, 785 

Kent v. Freehold Land, &c, Co. . 73, 
590, 776, 777 

v. Jackson . 29, 317, 518, 577 

579, 583, 594, 600 
Kent Benefit Building Society . 189, 
386*, 920 
Kent Tramways Co. . . .147 
Kentish Royal Hotel Co. . . 657 

Ker's case (4 App. Ca. 549, 598) . 758, 

802, 806 
Kernaghan v. Williams . 321, 598 
Kerridge v. Hesso . . . 145 
Kerr's case (9 Eq. 706) . . . 733 
Keynsham Blue Lias Co. . 673, 674 
v. Barker . . . 38, 911 

Khlut's case . . .42, 808, 862 
Kidderminster (Mayor of) v. Hard- 

wick .... 

221, 224 

Kidwelley Canal Co. v. Raby . 

24, 107, 


Kilkenny, &c. Railway Co. 


Fielden .... 

. 263 

Kimber v. Barber . 


Kincaid's case (11 Eq. 192) 

301, 327, 

757, 791 

— — (2 Ch. 412) 

. 26, 28 

Kinder v. Taylor . 


King's case (6 Ch. 196) 802, 

803. 827, 


King, ex parte (3 Ch. 10) . 


v. Accumulative Ass. Co. 

. 247, 

248, 249 

v. Marshall 

. 192 



v. Parental Endowment Co. 

Kingchurch v. People's Garden 


Kingsbridge Flour Mill v. Ply- 
mouth Grinding and Banking 

Co 154, 206 

King's Cross Industrial Dwellings 

Co. 638, 645*, 652* 

Kingston's case (Duchess of) . 283 
Kintrea, ex parte 123, 124, 466. 685, 

Kipling v. Allan . . 517, 525 

v. Todd . 54, 104, 293, 301, 517, 

520, 525, 797 
Kirk v. Bell . 156, 157% 174, 200, 409 

v. Bromley Union . 222, 227 

Kirkstall Brewery Co. . . . 403 
Kisch v. Central Railway Co. of 

Venezuela . . .29, 72*, 74 
Kit Hill Tunnel . . 713, 720, 723 

Williams (16 Ch. D. 390) 
Kiveton Coal Co. , ex parte . . 698 

Phillips (7 Ch. 730) 
Knight's case . 313, 533, 822, 843 

Knight v. Barber . 453, 469, 490 

v. Knight . . . . 541* 

Knowledge (The Society of Prac- 
tical) v. Abbott . . . 98 
Knox's and Nugent's case . . 791 
Kollman's Railway Locomotive and Car- 
riage Improvement Co. 
Beresford (2 M & G. 197, and 3 De 

G. & Sm. 175) 
Ellis (3 De G. & Sm. 172) 
Kuper's Assignees (3 De G. & Sm. 

La Banque Jacques Cartieu v. 

La Banque de Montreal . 177, 180 
Labouchere v. Earl of Wharnclifie 303, 

528, 577 
Lacey v. Hill . . . 205, 514* 

Lacharme v. Quartz Eock Mining 

Co 279, 595 

Ladywell Mining Co. v. Brooke . 358* 
Laing v. Reed . . .189, 919 
Laird v. Birkenhead Railway Co. 223 
Lake v. Argyll . . . 145, 149 




Lama Italian Coal Co. . . 698 

Miller (2 Ch. 692) 
La Mancha Irrigation and Land Co. 

Lord Claud Hamilton (8 Ch. 548) 
Lambert v. Rendle . . . 543 
Lambton, ex parte . . . 727 

Lamert v. Heath . . .512 

Lamond v. Davall . . . . 497 
Lamprell v. Billericay Union 221, 227 
Lancashire Brick and Tile Co. . 626 
Lancashire and Carlisle Railway 
' Co. v. North- Western Railway 

Co 324 

Lancashire Co-operative Building 

Co 616 

Lancashire Cotton Spinning Co. . 680 
Lancaster, &c. , Railway Co. v. 

Heaton . . . " . .17:5 
Lancaster's case (14 Eq. 72) . . 733 
Lancaster, ex parte (5 Ch. 1). 911) 310 
Land Credit Co. of Ireland 
McEwen (6 Ch. 582) 
Munster (1 W. N. 252) 
Overend, Gurney & Co. (4 Ch. 460) 
Trower v. Lawson (14 Eq. 8) 
Weikersheim (8 Ch. 831) 
Land Credit Co. v. Lord Fermoy 371, 

375, 376 
Land Credit (General Co. for Pro- 
moting) . . . . 116, 135 
Land Development Association 
Kent (37 Ch. D. 508> 

(39 Ch. D. 259) 

Landman v. Entwistle . . 247 

Landore Siemens Steel Co. . . 675 
Landowners' Inclosure Co. v. Ash- 
ford . 168, 175, 1S9, 191, 193 
Lane's case ( 1 De G. & Sm. 504) 52, 
178, 301, 313, 328, 389, 
517, 822, 840 
Lane, re (14 Ch. D. 856) . . 541 

v. Smith . . . . 194 

Langham Skating Rink Co. 630, 633, 

634*, 643, 649*, 654, 700 

Langham's trusts . . . 452 

Langley MiU Steel, &c, Co. . 637, 648 

Lankester's case 
Lanyon v. Smith 

829, 840 
95, 97, 127, 263, 
293, 683*, 819 

Larking, ex parte 

Lame, Belfast, &c, Railway Co. 

(14 Jur. 996) . . 646*, 653 

Baker (3 De G. & Sm. 242) 
Latta, ex parte . . . 627, 646 
Law v. London Indisputable Life 

Policy Co. . . 249, 251, 412 
Lawe's case . 307, 316, 518, 838, 860 
Lawless v. Anglo Egyptian, &c, 

Co. .."... 209 

Lawrence's case . . .26, 28, 771 
Lawrence v. Knowles . 498, 551 

v. Lawrence . . . 547 

v. Wynn . . . 416, 427, 565 

Lawson v. Bank of London . . 113 
Lawton, ex parte 561, 627, 641, 647* 

v. Hickman . . 453, 488 

Lee v. Bude, &c. Railway Co. . 292 

Lee v. Hah-y 113 

v. Neufchatel Asphalte Co. . 431, 


v. Nuttall . . . 720, 721 

v. Sangster . . . .713 

Lee and Chapman's case (30 Ch. 

D. 216) 739 

Lee and Moor's case (5 Eq. 368) . 768 
Leeds Banking Co. . 418, 693, 697 
Addinell (1 Eq. 225) 
Barrett (2 Dr. & Sm. 415) 
Clarke (1 W. N. 254) 
Dobson (1 Ch. 231) 
Fearnside and Dean (ib.) 
Eoward (1 Ch. 561) 
Mallorie (2 Ch. 181) 
Matthewman (3 Eq. 781) 
Leeds Estate Building Society v. 

Shepherd . 321, 371, 374*, 375, 376, 
388, 432, 433, 444 
Leeds and Thirsk Railway Co. v. 

Fearnley .... 39, 422 

Leeke's case . 15, 395, 786, 789, 796* 
Le Feuvre v. Miller . . . 173 

Lefroyv. Gore . . . . 145 

Leggott v. Western . . . 462 

Leicester Club and County Race Course 
Cannon (30 Ch. D. 629) 
Leicestershire Banking Co. . . 861 
Leifchild's case . . . 206, 783 

Leishman v. Cochrane . 46, 75& 

Leominster Canal Co. v. Shrews- 
bury and Hereford Railway Co. 151, 
223, 227 
Le Tailleur v. The South Eastern 

Railway Co. 
Lethbridge v. Adams 


Letterkenny Railway Co. 

Levi v. Ayers 

Levick, re . . 

Levita's case 

Levy v. Abercorri's Slate Co 

Lewis v. Baldwin . 

v. Billing . 

v. Carr . 

v. Nicholson 

, re (6 Ch. 818) 

Lhoneux, Limon & Co. v. 
Kong Banking Co. . 


250, 251, 

373, 854 

. . 905 

. 553 

. . 678 

14, 796 

196, 19S 

. 37, 909 


. . 329 

. 241 

. 457, 458 


265, 909 

Licensed Victuallers' Mutual Trad- 
ing Association . . . . 761 

Life Assurance Co. of England 673, 674 
Blake (34 Beav. 639) 
Thompson (4 De G. J. & Sm. 749) 

Limehouse Works Co. 
Coate (17 Eq. 169) 

Limerick, &c, Rail. Co. v. Fraser 

Limpus v. London General Omni- 
bus Co. ..... 

Lindsev v. Great Northern Rail- 
way Co. . . . 151, 223, 258 

Lindus v. Melrose 186, 233, 234*, 240 

Linford v. Provincial Horse and 

Cattle Insurance Co. . . . 161 

Linley v. Taylor .... 452 





Linton v. 

Lintott, ex parte 
Lion Insurance 



Blakeuey Industrial 

. 263, 915 
. 847 
Association v. 

853, 855 

Lisbon Steam Tramways Co. . . 691 
Litchfield's case .... 828 
Littledale, ex parte 467, 753, 756, S24 
Littlehampton Steam Ship Co. 66, 627 

Ellis (3 De G. & S. 172) 
Ormerod (5 Eq. 110) 

Liverpool Borough Bank 
Durnnty(26'Beav. 268) 

v. Mellor ■. 

640, 800 


Turner (2 De G. F. & J. 


Liverpool Civil Service Association 

Greenwood (9 Ch. 511) 
Liverpool Loan Co. 

Bullen (7 Ch. 732) 
Liverpool and Manchester Saw-Mills 
and Timber Joint-Stock Co. 

Ashburner (13 Jur. 691) 

Holt (3 De G. & Sm. 99) 
Liverpool Marine Assurance Co. 

Green shield (5 De G. & Sm. 
Llanfyrnach Silver Lead Mining 

Co 889 

Llangennoch Coal Co. . . 22, 668 
Llanharry Hematite Iron Ore Co. 

Roney's case (4 De G. J. & 
Sm. 426) 

Stock's case (4 De G. J. & 
Sm. 426) 

To thill (1 Ch. 85) 
Lloyd, ex parte . .148,722,860 

v. Crispe .... 491 

v. Dimmack . . . . 589 

v. Lloyd .... 675 

Lloyd Generate Italiano 622, 652, 912 
Llynir Coal and Iron Co. 

Hide (7 Ch. 28) 

Lock v. Yenables 
Lofthouse's case 
Logan, ex parte 

v. Courtown 

Londesborough's case, Lord 

. 545 

94, 256, 524, 840 

. . 731 

599, 601 

244, 849, 

851, 860 


London Armoury Co. . 

London Assurance Co. v. London 
and Westminster Insurance Cor- 
poration . . . • • 113 

London Bank of Scotland, exparte 

(12 Eq. 268) .... 763 

(\V. N. 1867, 114) . . 849, 884 

London and Birmingham Alkali 

Co 624, 638 

London and Birmingham, &c. 

Bank 124, 458 

Wright (12 Eq. 331) 

London and Birmingham Railway 

Co. v. Winter . . . . 223 

London, Birmingham, and Bucks 

Curzon (3 Dr. 509) 

London and Birmingham Exten- 
sion and Northampton, &c. 
Railway Co. 

Carpenter's Executors (5 De 

G. & Sm. 402) 
Gay ( 5 De G. & Sm. 122) 

(1 De G. M. & G. 347) 

Higgins (2 Jur. N. S. 178) 
Hopkinson and Underwood 

(7 De G. M. & G. 193) 
Prichard (5 De G. M. & G. 

Weiss (5 De G. k Sm. 402) 
London and Bombay Bank (18 

Ch. D. 581) . 41, 803, 808*, 811 

(1 Ch. 525) . . . 701, 702 

Cama (9 Ch. 686) 
London and Brighton Railway Co. 

v. Fairclough 59, 106, 313, 423, 530, 
532, 533, 534 
v. London and South- West- 
ern Railway Co 202 

London, Brighton, and South 

Coast Railway Co. v. Goodwin . 258, 

London, Bristol, and South Wales 
Railway Co. 

Capper (3 De G. & Sm. 1) 
London and Caledonian Marine 

Insurance . 684, 870, 882, 885 
London Celluloid Co. . . 787, 789 
London, Chatham and Dover Rail- 
way Co. v. South-Eastern Rail- 
way Co 184 

London and Colonial Co. 
Clark (7 Eq. 550) 
Horsey (5 Eq. 561) 
London and Continental Assurance 

Society v. Redgrave . 23, 25, 411 
London Conveyance Co. 

Wise (1 Dr. 465) 
London Cotton Co. . . . 676 

London and County Assurance Co. 
Jessopp (2 De G. & J. 638) 
Jones (27 L. J. Ch. 666) 
Wood and Brown (9 W. R. 
366 and 10 ib. 662) 
London and County Bank Co. v. 

London and River Plate Bank 474, 

476, 477, 483 

London and County Coal Co. 632, 641, 

London and County General Agency 

Hare (4 Ch. 503) 
London and Devon Biscuit Co. . 677 
London Dock Co. v. Sinnott 165, 220, 

London and Dublin, &c. Railway 

Co 656 

London and Eastern Banking Cor- 

Longworth's Executors (Johns. 

No. 2 (Johns. 465) 

London and Eastern Banking Cor- 
poration . . . . .613 



London and Exeter Rail. Co. 

Holinsworth (3 De 6. & Sm. 7) 
Parburv (3 ib. 43) 
London and Financial Association 

e. Kelk 163, 177, 179, 200, 364, 373 
London Founders' Association v. 

Clarke . . . 467, 491, 507 

London and Grand Junction Kail- 
way Co. v. Freeman . 88, 106 

v. Graham 49, 51, 58, 106, 421 

London, Hamburg, &c. Exchange 
Emmerson rl Eq. 236) 
Evans (2 Ch. 127) 
Preston (2 W. N. 10) 
Ward and Henry (2 Ch. 431) 
Zulueta (9 Eq. 270) 

(5Ch. 444) 

London India Rubber Co. (5 Eq. 

519) 868 

(1 Ch. 329) . . . . 875 

London and Manchester Indepen- 
dent Railway Co. 

Barber (1 M. & G. 176) 

(1 De G. & Sm. 726) 

Bass (1 De G. & Sm. 722) 
Pocock (ib. 731) 
London and Manchester Industrial 

Association . . . . 700 

London Marine Insurance Associ- 
ation . . 621, 662, 722, 849 
Andrews & Alexander (8 Eq. 176) 
Chatt (8 Eq. 176) 
Cook (8 Eq. 176) 
Crew (8 Eq. 176) 
Smith (4 Ch. 611) 
London and Mediterranean Bank 

Agra and Masterman's Bank (6 Ch. 

Bolognesi (5 Ch. 567) 
Wright (7 Ch. 55) 

(12 Eq. 331) 

London Mercantile Discount Co. 640, 

London Monetary Co. v. Smith . 114 
London, Newbury, & Bath Direct 
Rail. Co. 

Cookson (15 Jur. 615) 
London and Northern Insurance 

Stace & Worth (4 Ch. 682) 
London and North- Western Rail- 
way Co. v. McMichael . . . 39 

v. Price . . . .163, 165 

London and Paris Banking Corpo- 
ration .... 637, 648* 
London and Provincial Consoli- 
dated Coal Co. . . 520, 797, 839 
London and Provincial Law Assur- 
ance Society v. London and Pro- 
vincial Joint-Stock Life . . 113 
London and Provincial Provident 

Society v. Ashtou . . . 114 
London and Provincial Starch Co. 

Gower (6 Eq. 77) 
London and Provincial Telegraph 

Co 124, 551, 552 


London Quays, &c, Co. 702, 888, 889 
London and Scottish Bank 

Logan (9 Eq. 149) 
London and Southern Counties, 

&c., Land Co. . 157, 158, 223, 300, 
319, 409 
London and South Essex Railway Co. 

Murroll (3 De G. & Sm. 4) 
London and Staffordshire Fire In- 
surance Co., In re . . 23,999 
London Suburban Bank (6 Ch. 

641) .... 634, 650 

(15 Eq. 274) .... 832 

(19 W. R. 950) . . . 676* 

London Tramway Co. . . . 483 

London and Westminster Insurance Co. 

Phillips (3 De G. & Sm. 3) 
London and Westminster Wine 

Co 655, 657 

London and Yorkshire Bank v. 

Cooper . . . 692, 870, 970 
London Wharfing and Warehous- 
ing Co 637, 643 

Long v. Kent . . . . 5 11 

Longdendale Cotton Spinning Co. 675 
Longworth's case (7 W. R. 483) . 84 
Longworth's executors' case (1 De 

G. F. & J. 17, 31) . 141, 142, 312, 

612, 849 

Looker v. Wrigley . 189, 191, 196, 919 

Lord, re 883 

v. Copper Miners' Co. 

208, 317, 

579, 601 

504, 505, 


62, 122, 896 

. . 573 

. 213 

. 834, 835 

Loring v. Davis . 489, 493 

Los* case 

Lovell v. Andrew . 

v. Hicks 

Lowe's case 
Lowe v. London and North West- 
ern Railway Co. . . 220, 227 
Lowenthal, ex parte . . . 269 
Lowestoft, Yarmouth, &c, Tram- 
ways Co 102, 904 

Lowndes, ex parte . . 852, 858 

v. The Garnett and 

Moseley Mining Co. . 383*, 886 

Luard's case . 41, 42, 685, 752, 807, 

808, 809 
Lucas v. Beach . . . 1 43, 606 
Luckombe v. Ashton . . . 246 
Lucy's case . . . 710, 860 

Ludlow (Mayor of) v. Charlton 185, 221 
Lund's case .... 800, 825 
Lund v. Blanshard . 272, 568, 573 
Lumsden v. Buchanan . . 801 

Lumsden's case . . 39, 810, 829 
Luudy Granite Co. . . 679, 680 

Heaven (6 Ch. 462) 
Lydc v. Eastern Bengal Railway 


Lydney, &c, Co. v. Bird 

Lyon's case 

Lyon v. Haynes 
Lyster's case . 

321, 571, 598 

. 347, 349, 

356*, 357, 661 

29, 410, 411, 761, 771, 


437, 610 

157, 256, 532, 533, 843 


















McAkpley v. Irish Iodine Co. 
Macbride v. Lindsay . 
Macoallum v. Turton 
McCollin v. Gilpin 
McC'reight v. Stevens 
M "Levitt U Connolly 
Macdougall v. Gardiner 

573*, 578, 581, 600 

v. Jersey Hotel Co. . 321, 410, 

411, 432, 597, 599 
MacDowell's rase .... 730* 
McDowell v. Davis . . .706 

. v. Doyle . . . 267, 706 

McEwan v. Campbell . . .145 
McEwen's case . . . 556, 815 
McEwen v. London and Bombay 

and Mediterranean Bank . 675 

v. West London Wharves, 

&c, Co. . 44, 104, 801, 824 

v. Woods . . . 512, 513 

Macfarlane's claim . 713, 716, 721, 732 
McGowan & Co. v. Dyer . . 209 
McGregor v. Dover and Deal Bail- 
way Co. 186, 244 

v. Keiley .... 670 

Mclntyre v. Belcher . . 247, 249 

v. Connell . 2, 9, 109, 462*, 463 

v. Miller .... 269 

Mclver's claim . 249, 717, 732, 738, 

747, 864 
MacKay's case . 367, 694, 695, 696, 

Mai hay v. Commercial Bank 216, 217* 
McKenna v. Bolt . . .270 
Mackenzie, ex parte . 740, 742, 743, 848 
v. Sligo and Shannon Bail- 
way Co. . 279, 670, 671, 901, 909 
Mackereth v. Glasgow and S. W. 

BailwayCo 909 

Mackley's case . . . . 797 

McKewan's case . . . 783, 855 
Mackrell v. Glasgow & S. W. Bail. 


Maclae v. Sutherland 
Maclaren v. Stainton 


185, 190, 234* 

430, 546*, 

909, 911, 912 


. . 731 

561, 564 

. 123, 777 

144, 145 

Maclean v. Dunn 

Maclure, ex parte . 

MacMahon v. Upton 

McNeill's case 

Maddick v. Marshall 

Madras Irrigation and Canal Co. 
(16 Ch. D. 702) . 

(23 Ch. D. 248) 

Madrid Bank 

Wilkinson (2 Ch. 537) 

v. Bavley . 

v. Belly . 

Madrid and Valencia Bailway Co 
Chadwick (15 Jur. 597) 
James (3 De G. & Sm. 127) 

(2M. & G. 169) 

Quitter (5 De G. & Sm. 276) 
Turner (2 M. & G. 169) 
(3 De G. & Sm. 127) 

Magdalena Steam Navigation Co. 


662, 698 

695, 708 

367, 865 




Magdalena Steam Navigation Co. 

v. Martin ... 36, 757 

Magnus, ex parte . . . . 713 
Maguire's case . . 312, 758, 824 
Mahony v. East Holvford Mining 

Co. . . 157, 158, 160, 167, 196 
Mainwaring's case . 16, 778, 861 

Mair v. Himalaya Tea Co. . . 601 
Maitland's case (4 De G. Mac. & 

G. 769) . . .35, 145 

(3 Giff. 28) ... 766 

Malachy v. Soper . . . . 454 
Malaga Lead Co. 

Firmstone (20 Eq. 524) 
Mallock v. Jenkins . . .920 
Mallorie's case . . . 770, 814 
Malone, ex parte . . . 815 

Manchester Bank 

Mellor(12Ch. D. 917) 
Manchester Economic Building 

Society . . . 662, 663, 698 
Manchester and Liverpool District 
Banking Co. 
littler (18 Eq. 249) 
Manchester and London Life Ass. 260* 

657, 734 
Manchester and Milford Bailway 

Co 279 

Mangles v. Grand Coll. Dock Co. 412 
Manisty v. Churchill . . . 717 

Mann's case 
Mansfield's case 
Mant v. Smith 
March v. A. G. 
Mare v. Charles 
v. Malachy 

123, 810, 828 

761*, 771, 851, 860 


. . 452 

. 232* 

. . 593 

Maria Anna, &c. , Coal and Coke Co. 
Hill (20 Eq. 585) 
McKewan (6 Ch. D. 447) 
Maxwell (20 Eq. 585) 
Marine Estates Co. . . . 263 

Marine Investment Co. 

Boole's Executors (8 Ch. 702) 
Marine Mansions Co. . 197, 707, 865 
Marino's case . . . .121, 836 

Markham v. Markham . . 570 

Markwell's case . . . 765*, 862 
Marlborough Club Co. (1 Eq. 216) 658, 


(5 Eq. 365) . . . 694, 783 

Marlow v. Bitfield . . .236 
Marnham, ex parte . . . . 488 
Marquis of Abercorn's case . . 301 
Marsden v. Kent . . . 548 

Marseilles, &c, Land Co. 703, 878, 879, 

Brandon (30 Ch. D. 598) 
Credit Foncier, &c. of England (7 

Ch. 161) 
Evans (11 Eq. 151) 
Smallpage (30 Ch. D. 598) 
March's case (13 Eq. 388) . . 867 
Marsh, ex parte (1 Mac. & G. 302) 863 

v. Keating . . . 483 

Marshall, ex parte . . 556, 815 

v. Corporation of Queen- 

boiough 223 



Marshal] v. Glamorgan Iron Co. 526, 

818, 833 
Marson v. Lund. . 291, 295, 670 
Mil tano v. .Mann . . . . 661 
Martin v. Lacon . . .451 

v. Sedgwick . . , 454 

Martin's casi 2 Hem. & M. 669) 62, 

122, 896 
Martin's claim (14 Eq. 148) . 761 

Mai tin's Patenl Anchor Co. v. 

Morton . . . 556, 815, 848 
Marty n v. day .... 96 

Marylebone Joint-Stock Hank (18 
Jur. 281) 850, 851, 852, 863, 865, 866 

(25 L. J. Ch. 650) 852, 854, 858 

Husk (:; TV G. &S. 267) 
Davidson {ib. 21) 
Stanhope (ib. 198) 
Troutbeck (1 De G. & S. 585) 
Walker (1 De G. & S. 585) 
Masons' Hall Tavern Co, 

Habershon (5 Eq. 286) 
Mason v. Bogg . . . . 720 

v. Harris . . 571, 572, 579 

Masonic and General Life Assur- 
ance Co. ... . 624 
Massey, re. . . 703, 704, 865 

v. Allen .... 691, 806 

Master's case . . . 825, 828 
Mather, ex parte . . . 141 
v. National Assoc. Invest- 
ment Society . . 293, 794 
Matheson Brothers. Limited 622, 623, 
636, 644% 912 
Mathew's carse . 15, 767, 770, 861 
Mathew v. Blackmore . . . "J 1 7 
Matlock Old Bath Hydro. Co. 

Maynard (9 Ch. 60) 
Matterson v, Elderfield . . . 920 
Matthewman's case . .41, 809 

Matthews v. Great Northern Rail- 
way Co. ..... 401 

Maturin v. Tredinnick . 496. ;,:•! . ,v.^ 
Maude, ex parte (6 Ch. 51) . 852, 869, 

Maudslay and Field's case . 766, 860 
Maughan v. Leamington Gas Co. 434* 
Maund v. Monmouthshire Canal 

Co 209 

Maunder v. Lloyd . . . 913, 914* 
Maunsell v. Midland Great West- 
ern Railway Co. 184, 186, 571, 598, 

Mawer's case .... 848 
Maxtrd v. Paine 

(No. 1, L. R, 4 Ex. 81) . 503, 510, 

(No. 2, L. R. 6 Ex. 132, and 

4 ib. 203) . 491, 495, 500, 501, 

504*, 506, 508, 509, 510, 511 

Maxwell's case (20 Eq. 585) 783, 855 

(24 Beav. 321) . . 811, 829 

trusts (1 Hem. & M. 610) . 547 

v. Dulwich College . . . 223 

v. Port Tennant, &c. 357, 585, 587 

Mayhew's case . 94, 254, 471, 823, 831 
Maynard's case . . . 785, 798 



Maynard o. Eaton . . . 509, 511 
Mayor of < lofchester v. Lowten 1T8, 207 
Mayor of Kidderminster v. Hard- 
wick 221, 224 

Mayor of Ludlow v. Charlton 185, 221 
Mayor of Stafford v. Till . . 220 
Mayor of the Staple of England 
v. Bank of England 198, 221, 224, 
483, 484, 486, 487 
Meader v. Isle of Wight Ferry Co. 282, 

Medical Invalid, &c, Life Assur- 
ance Society 
Griffith (6 Ch. 374) 
Spencer (6 Ch. 362) 
Meek v. Wendt & Co. . . . 241 
Meeus v. Thelusson . . . 914 
Melbourne Banking Corporation 
Brougham (4 App. 156) 

v. Brougham . . .223 

Melhado v. Hamilton . . . 405 
v. Porto Alegre, &c. Rail- 
way Co 147 

Meliorucchi v. Royal Exchange 

Co. . . . 551 

Melhss v. Shirley Local Board . 222 
Menier v. Hooper's Telegraph 

Works . . . 309, 321, 572 

Mercantile and Exchange Lank 
London Bank of Scotland (12 
Eq. 268) 
Mercantile Mutual Marine Insur- 
ance Association . . 556, 815 
Mercantile Trading Co. 
Schroder 1] Eq. 131) 
Stringer (4 Ch. 475) 
Mercer's case . 
M< rchants' Co. . 

Heritage (9 Eq. 5) 
Merchant Banking Co. of London 
v. Merchants' Joint-Stock Bank 
Merchant Traders' Ship Loan and 
Assoc. Co. .... 
Chappie (5 De G. & Sm. 400) 
Talbot (5 De G. & Sm. 386) 
Yelland (5 De G. & Sm. 395) 
Merchants' and Tradesmen's As- 
surance Society . . 260* 
Meredith's case and Conver's case 
Merionethshire Slate and Slate 

Slab Co 

Day (3 Jur. N.S. 1016) 
Rye {ib. 460) 
Merry v. Nickalls 501, 503, 504 
Mersey Docks Co. v. Gibbs . 
Mersey Railway Co. 
Mersey Steel and Iron Co. v. Nay- 
lor & Co. . . 273, 667, 719, 728*, 
738, 739 
Metropolitan Bank v. Heiron . 374 

v. Jones .... 881 

v. Pooley . . . . 210 

Metropolitan and Provincial Bank 726 
Metropolitan Public Carriage, &c. 
Brown (9 Ch. 102) 
Cleland (14 Eq. 387) 


. 690 
685, 690 








Metropolitan Railway Junction Co. 
Markwell (5 De G. & Sm. 528) 
Metropolitan Railway Warehouse 

Co. (15 W. R. 1121, L. J.) . 628 

("W. N. 1867, 94) . . 646* 

Metropolitan Saloon Omnibus Co. 635, 
639, 641, 650* 

v. Hawkins . . . 563 

Meux's Executors' case 183, 207, 813, 

Meux v. Maltby . . 266, 267, 272* 
Mexican and South American Co. 671, 

747, 864 
Aston (4 De G. & J. 320) 

(27 Beav. 474) 

Barclay (26 Beav. 182) 
Costello (2 De G. F. & J. 302) 
De Pass (4 De G. & J. 544) 
Finlay Hodgson (26 Beav. 

Grisewood <fc Smith (4 De G. 

& J. 544) 
Hyam (1 De G. F. & J. 75) 
Lund (27 Beav. 465) 
Shewell (2 Ch. 387) 
Wilkinson (2 Ch. 536) 
Meyer's case . 21, 521, 772*, 841 
Middlesborough Assembly Rooms 

Co 628, 639, 649* 

Midland Counties Benefit Build- 
ing Society . . . 916, 918, 922 
Midland Great Western Railway 
Co. r. Gordon . 23, 46, 106*, 410, 


v. Johnson . . 222, 227 

Midland Union, &c. Railway Co. 
Lucy (4 De G. M. & G. 357) 
Norbury (5 De G. & Sm. 423) 
Pearson's Executors (3 De G. M. & 
G. 241) 
Migotti's case . . . . 798 

Milan Tramways Co. 

Theys (22 Ch. D. 122 and 25 
Ch. D. 587) 
Milburn v. Codd . . .606 

Mildmay v. Methven . . . 725 
Miles v. Bough . 300, 313, 330, 415, 

417, 418 

v. New Zealand, &c. Co. . 459 

v. Thomas . 575, 581, 601, 609 

Milford Docks Co 624 

Lister (23 Ch. D. 292) 
Mill v. Hawker . . . . 240 
Millard v. Bailey . . . 541 

Miller v. Thompson . . . 233* 

Miller's case (3 Ch. D. 391) . 260* 

(5 Ch. D. 70 & 3 ib. 

661) . 789*, 793, 795*, 839, 844 
Miller's Dale, &c, Lime Co. . 305, 775 
Mills v. British Provident Assur- 
ance Society . . . 313 

v. Northern Railway of 

Buenos Ayres Co. . 278, 431, 602 
Milroy v. Lord . . . 500, 588 
Minor v. The London and North- 
Western Railway Co. . . 911 
Mitcalfe's case . . . 367, 696 

Mitchell's case (9 Eq. 363) . 39, 802, 


(5 Cb. 400) . 556, 693, 816. 848 

Mitchell's claim (6 Ch. 822) . 723 

Mitchell's and Rutherford's cases 

(4 App. Ca. 548 & 567) . 466, 806, 

Mitchell v. City of Glasgow Bank 409, 


v. Moberly . . .451 

v. Newall . . . 494, 512 

Mitre Assurance Association . 613 

Evre (31 Beav. 177) 
Mixer's case . 72, 80, 82, 85, 214 
Moifatt v. Farquhar . . 309, 377, 

464, 465, 566, 597 

. 309 

. . 514 

— - — v. Farquharson 
Mollett v. Robinson 
Monarch Insurance Co. 

Gorrissen (8 Ch. 507) 
Monmouthshire Canal Co. v. 

Kendall . . . . 310 
and Glamorganshire Bank- 
ing Co. . . 639, 642, 653* 
Cape's executors (2 De G. 
M. & G. 562) 
Montagu's case (Lord R.) . 746,834 
Montreal (Bank of) v. Bathune . 910 
Montreal Assurance Co. v. Mc- 

Gillivray .... 187 

Moody v. London and Brighton 

Railway Co. . .156, 160, 161 

Moor, ex parte 


v. Anglo-Italian Bank 

. 197, 624 

675, 720 

Moore v. Garwood 

. 14, 31 

r. Hammond . 

. . 307 

v. Metropolitan Railway Co. 209 

v. Rawlins . . 117, 533, 922 

Moore Gold Mining Co., Sir John 

703, 878 
Morgan's case (1 Mac. & G. 235 & 

1 De G. & Sm. 750) . . 317, 
320, 518*, 817, 838* 

(28 Ch. D. 620) . 440, 705, 896 

Morgan v. Great Eastern Railway 

Co 569 

Morisse v. Royal British Bank . 282, 

295, 671 
Morrice v. Aylmer . . . 400, 541 
Morris' case (7 Ch. 200 & 8 Ch. 800) 394, 

Morris v. Cannan . . 473, 488 

v. Glynn . . . 451 

v. Kearsley .... 492 

v. Sadlier .... 537 

Morrison, ex parte (De Gex, 539). 158, 


(15 Jur. 346 & 20 L. J. Ch. 

296) 765 

v. Glover .... 916 

Morton's Gase . . . . 824 

Morvah Consols Tin Mining Co. 

McKay (2 Ch. D. 1) 
Moscow Gas Co. (City of) v. Inter- 
national Financial Society . . 263 
Moseley v. Cressey's Co. . 32, 568 

.mi in mi i ii. s iiei 1:1:1:1. 1» TO. 

Moscli'v Green CoaJ and Coke Co. 
Barreti ( 1 De G. J. & S. 756) 

(4 De G. J. &S. 416) 

Fox (5 Eq. 118) 

Moss, ex part* 14 Ch. D. 398) . 
(3 De G. &S. 599). . . 

(] 1 in-. 754) 

Steam ( rondola Co. 



622, 654* 

15, 54*, 59 



Mostyn v. Calcott Ball Mining Co 

Moulton v. Caimoux 

Mowah Consols Tin .Mining Co. . 

.McKay (2 Ch. D. 1) 
Mowatt v. Castle Steel Co. . .197, 
198, 723, 784 

exparte(1 Drew, 247) . . 851 

v. Lord Londesborough . 31, 34 

Mowatt and Elliott's case (3 De G, 

M. & G. 254) 
Mozley v. Alston 

780, 851, 861 
300, 570, 573, 575, 
76*, 578, 581*, 600 
. 736 
813, 848 

Mudford's claim . 

Muggeridge, re 

Muir's case (4 App. Ca. 337) 

Muir v. City of Glasgow Bank . 801 

Mulkern v. Lord . . . 921 

Mulliner v. Midland Railway Co. 202 

Monday, ex parte . . . . 748 

Municipal Permanent Building 

Society v. Kent . . . 921 

v. Richards . . . 921 

Munster Bank, Limited . . . 805 

v. Cammell Co. . 302, 337, 567, 

599, 996 
Munt's case . 201, 519, 838, 839 

Munt v. Shrewsbury and Chester 

Railway Co. . 321, 323, 571, 598 

Murphy v. O'Shea . . .368 
Murray's executors' case . 193, 226, 328, 


Murray v. Busb . 300, 336, 758, 822, 

824, 832, 841 

v. East India Co, 

v. Flavell 

v. Pinkett . 

v. Scott . 

Murrell, ex parte 
Musgrave's case 

185, 222 

. 589 


189, 919 

652*, 653 

121, 500, 749, 835 

Mutter v. Eastern and Midland 

Railway Co. . 314. 333, 440, 567, 

599, 604 

Mutual Society 

- (22 Ch. D. 

(24 Ch. D. 

714) . 692, 695, 705 
425) . . . 872 
Grimwade (18 Ch. D. 530) 
Mutual Aid Building Society (29 

Ch. D. 182&30Ch. D. 434) . 189, 872 
Myers v. Perigall . . . . 452 

v. Rawson .... 293 

Mysore Reefs Gold Mining Co. . 703 

Nacupai Gold Mining Co. . . 659 
Nanney v. Morgan . 108, 467, 469, 
472, 477, 588 
Nanteo's Consols Co. 

Thomas (13 Eq. 437) 

688, 746 
834, 835 

• ;-2 

Nantle Vale Slate Co. 

Job (27 Beav. 32) 
Nant-y-Glo v. Grave . . . 367* 
Narborough and Watlington Rail- 
way Co. 

James (1 Sim. X. s. 140) 
Natal Investment Co. . .-640,651* 

Financial Corporation (3 Ch. 

Nevill (6 Ch. 43) 

Snell (5 Ch. 22) 

Nathan, Newman & Co. . 685, 

Nation's case .... 

National Alliance Assurance Co. 

Ashworth (10 W.B, 771) 
National Anns Co. 
National Assurance and In 
ment Association 

Munday (31 Beav. 20o) 
National Bank, re (10 Eq. 298) . 694, 


ex parte (14 Eq. 507) . 203, 726 

of St. Charles v. Barnales . 909 

National Bolivian Navigation Co. 

v. Wilson 30 

National Building Land Co. . 865 

National Coffee Palace Co. 

Panmure (24 Ch. I). 367) 
National Equitable Provident Society 

Wood (15 Eq. 236) 
National Exchange Co. of Glasgow 

v. Drew .... 211*, 213* 
National Funds Assurance Co. (10 

Ch D. 118) . 321, 371, 373, 375, 

378, 390, 695, 696 

(4 Ch. D. 305) . . 662, 698 

National Guaranteed Manure Co. 

v. Donald .... 199 

National Insurance and Invest- 
ment Co. 

Abercorn (4 De G. F. & J. 78) 
Cotterell (11 W. K. 13) 
Davie (4 De G. F. & J. 78) 
Munday (31 Beav. 206) 
National Live Stock Insurance Co. 

(26 Beav. 153) . . . 649* 

National Patent Steam Fuel Co. 
Baker (1 Dr. & Sm. 55) 
Barton (4 Dr. 535) 

(4 De G. & J. 46) 

Worth (4 Dr. 529) 
National Permanent Benefit Build- 
ing Society . . . 237, 662 
National Provincial Life Assurance 

Society . . 260*, 261, 645*, 734 
Fleming (6 Ch. 393) 
National Provincial Marine Insur- 
ance Co. 

Gilbert (5 Ch. 559) 

Parker (2 Ch. 685) 

National Savings Bank 

Hebb's case (4 Eq. 9) 
Native Iron Ore Co. 
Natle Slate Co. . 
Nash, ex parte 
Nassau Phosphat Co. 

626, 662, 863, 
875, 877, 887 

. . 203 
. 61, 605 
39, 111 
d 2 



Natusch v. Irving 319*, 321, 579*, 597 
Navan and Kingscourt Railwav 

Co ". 906 

Naylor's case . . . .85, 772 
Naylor v. South Devon Railway 

Co 535, 597 

Neale v. Turton . ■ . . 185 
Needham's case .... 821 
Needham v. Law . . 268, 269, 286 

v. Rivers Protection Co. . 676 

Neill's case 845 

Neilson, ex parte . . 488, 316 

v. James . . . 489, 511 

Nelson Mitchell v. City of Glas- 
gow Bank Liquidators . . 466 

Ness, ex parte 


v. Angas 


, 55 



v. Armstrong 




V. Bertram . 


r. Fenwick 


Nevill's case 


Nevins v. Henderson 


Newbigging v. Adam . 
New Brunswick Railway 





v. Conybeare 


v. Muggeridge 





New Buxton Lime Co. 

Duke's case (1 Ch 
Newby v. Von Oppen . 
New Callao . 






Newcastle, &c, Bank, 




Spence's case (17 Beav. 203) 
Newcastle Machinists' Co. 
Newcastle-upon-Tyne Marine In- 
surance Co. 

Brown's case (19 Beav. 97) 
Henderson's case (19 Beav. 
New Chili Gold Mining Co. . 334, 




New City Constitutional Club Co 
Purssel (34 Ch. D. 646) 

New Clydach Co. 

Newfoundland (Government of) v. 
Newfoundland Railway Co. 276 

New Gas Co 

New Gas Generator Co. . 640. 
646, 649* 

Newhaven Local Board v. New- 
haven School Board . 300, 302, 330, 


Newington Local Board v. Eldridge 

New London Brazilian Bank v. 
Brocklebank . . . 450 

Newport, &c, Railway Co. v. 
Hawes ..... 

New Quebrada Co. 

Newry, &c, Railway Co. v. Coombe 





— v. Edmunds . . 416, 419 

v. Moss . . .46, 421, 802 

New Sombrero Phosphate Co. v. 

Erlanger . . 70, 88, 354* 

New South Wales Bank v. Owston 210 

New Theatre Co. 

Bloxam (4 De G. J. & S. 447) 

(33 Beav. 529) 

Newton v. Belcher 

v. Daly ... 9: 

v. Liddiard . 

Newtownards Gas Co. 
New York Exchange, Limited 
New York Life Insurance Co. 
New Zealand Banking Corporation 

Hickie & Co. (4 Eq. 226) 

Levi & Co. (7 Eq. 449) 

Sewell (3 Ch. 131) 
Nicholas, ex parte 
Nicholay's case . . . . 
Nicholls v. Diamond . 
Nichols v. Rosewarne 
Nichols' case (W. N. 1867, 77) 26.* 772 

(29 Ch. D. 421) . 124, 763, 797 

(3 De G. & J. 387 and 420) . 72, 

80*, 82*, 87, 156, 206, 211, 214, 
215, 522, 749, 751, 824, 841, 861 


205, 293 


852, 869 

. 636 







Nicholson v. Bradfield Union 

v. Gooch 

Nickoll's case (24 Beav. 639) 




I, 805 


Niger Merchants' Co. v. Capper 
Nister Dale Iron Co. 

Hughes (1 De G. & Sm. 606) 
Nixon v. Brownlow . 23, 106, 291, 292, 

296, 393 




131, 132 

. . 767 

24, 393, 410, 

34*, 597, 599 


v. Green 

v. Kilkenny Railway < !o. 

v. Taff Vale Railway Co. 

Nockells v. Crosby 30*, 34 
Norbury's case 
Norman v. Mitchell 
Norrington, re . . . . o4» 
Norris v. Chambers . . . 912 

v. Cooper . . . 764, 766 

r. Cottle . . . 764, 766 

u. l r i s h Land Co. . 61, 280, 603 

North American Colonial Asso- 
ciation of Ireland v. Bentley . 424* 
North Brazilian Sugar Factories 

(56 L. T. (N. S.) 229) . . 660 

■ (37 Ch. D. 83) . . . 705 

North of England Joint Stock 

Banking Co. . . 654, 684, 703 
Angas (1 De G. & Sm. 560) 
Armstrong (1 De G. & Sm. 565) 
Bernard (5 De G. & Sm. 283) 
Burlinson (3 De G. & Sm. 26) 
Chartres (1 De G & Sm. 581) 
Crosfield (4 De G. & Sm. 338) 

(2 De G. M. & G. 128) 

Dodgson (3 De G. & Sm. 85) 
Fenwick (1 De G. & Sm. 557) 
Glaholme (1 De G. & Sm. 583) 
Gouthwaite (3 M. & G. 187) 

(3 De G. & Sm. 25S) 

Hall (1 M. & G. 306) 

(1 De G. M. & G. 1) 

(3 De G. & Sm. 80) 

Hawthorne (1 M. & G. 49) 
Hawthorn (1 De G. & Sm. 571) 



North of England Joint Stock 
Banking Co. — continued. 
Holme (2 De G. M. k G. 113) 

(4 De G. k Sin. 312) 

Hutchinson I De <;. & Sm. 563) 
Mawer | I De G. & Sm. 3 
Reaveley 1 1 De G. k Sm. 550) 
Sadler (3 De G. & Sm. 26) 
Sanderson (3 De G. k Sm. 67) 

(1 M. k G. 306) 

Straffon's Executors (1 De G. .M. ,v 
G. 576) 

n De G. >v Si„. 256) 
Thomas (1 De G. & Sm. 579) 
North Hallenbeagle .Mining Co. 

Knight (2 Ch. 321) 
Northampton Coal, &c, Co. c. 

Midland Waggon Co. . . 264 
North Kent Railway, &c, Co. 

Kincaid (11 Eq. 192) 
North London Railway Co. v. 

Great Northern Railway Co. . 596, 
598, 602 
North Shields Quay and Improve- 
ments Co. 

Davidson (4 K. & J. 688) 
North and South Wales Bank . 203 
North Stafford Steel Co. v. Ward 410, 

North-West Transportation Co. v. 

Beatty 309 

North- Western Railway Co. v. 

Me. Michael . . 106, 416, 422 

North-Western Trunk Co. . 653 

North Yorkshire Iron Co. . . 680 
Northern Assam Tea Co. . . 702 
Universal Life Assurance Co. (10 
Eq. 459) 
Northern Coal .Mining Co. 
Bagge (13 Beav. 162) 
Northern Counties of England File 
Insurance Co. 

Macfarlaine (17 Ch. D. 337) 
Northern and Southern Connect- 
ing Railway Co. 

Mercer (5 De G. M. & G. 26) 
Northey v. Johnson . 96, 256, 524 
Northfield Iron & Steel Co. . . 694 
Northumberland Avenue Hotel 

Co 147, 176 

Northumberland District Banking 
Co. . . . . . 112,617 

Northumberland and Durham 

Banking Co 708 

Bigge (5 Jur. N.S. 7) 
Dixon's executors (1 Dr. & 

Sm. 225) 
Luard (1 De G. F. & J. 553) 
Rhodes (7 W. R. 510) 
Totty (1 Dr. k Sm. 273) 
Norwegian Charcoal Iron Co. 

Mitchell (9 Eq. 363) 
Norwegian Titanic Iron Co. . 628 

Norwich Equitable Fire Insurance 

Co 691 

Norwich and Lowestoft Naviga- 
tion Co. v. Theobald . . 410 


Norwich and Norfolk Permanent 
Building Society . . .92] 

Smith's case (1 Ch. D. 481) 
Norwich Provident Insurance Society 

Bath (8 Ch. D. 334) 

(11 Ch. D. 386) 

Hesketh (13 Ch. I). 693) 
Norwich Yarn Co. (22 Beav. 165) 311, 

, 382 

(12 Beav. 366) . 628, 633, 647 

(13 Beav. 428) . . 715,749 

Bignold (22 Beav. 143) 

East of England Banking Co. 's case 
Nunn r. Clayton . . . 295 
'■. Lomer . . . . 296 

Oakbank Oil Co. v. Crum . 434, 455, 

Oakes and 1'. ek, 

(3 Eq. 576) . . . . 84 

See Oakes v. Turquand. 
(3 Eq. 634) . . 747, 862, 864 
(W. N. 1886, 361) . . 849 
Oakes v. Oakes . . . . 541 

v. Turquand 26, 29, 60, 70, 73, 

111, 214, 589*, 590, 753*, 776, 
777, 797, 810 
Oak Bits Colliery Co. . . 680, 681 
O'Brien's . . 104, 757, 791 

O'Connor v. Bradshaw . 135, 138 
Odessa Tramways Co. v. Mendel . 586, 

O'Flaherty v. McDowell . . . 1014 
Ogle v. Knipe . . . 450, 541 
Old Wheal Neptune Mining Co. 
Pulbrook i2 I).- G. J. k S. 348) 
Rawlings ^2 De G. J. & S. 348) 
Onion's case . . .15, 16 
Onslow's trusts 

Oppenheimer v. British and Fo- 
reign Exchange, &c. Bank 
Oriental Bank Corporation 

The Crown (28 Ch. D. 643) 




Guillemin (28 Ch. D. 634) 
MacDowall (32 Ch. D. 366) 
Oriental Commercial Bank (5 Ch. 

358) 204 

(W. N. 1866, 283) . 637, 643, 659 

(7 Ch. 99) . . . . 728 

Alabaster (7 Eq. 273) 
Barge (5 Eq. 420) 
European Bank (7 Ch. 99) 
Maxoudoff (6 Eq. 582) 
Morris (7 Ch. 200) 

(8 Ch. 800) 

— — exparte(3 Ch. 791) . 728,804 
Oriental Financial Corporation, ex 

parte (4 Ch. D. 33) . . . 725 
Oriental Hotels Co. ... 865 

Oriental Inland Steam Co. ,. 
Briggs - . . . 16, 587 

Sciude Railway Co. (9 Ch. 557) 
Ormerod's case . . .65, 800 

( Irnamental Pyrographic Co. v. 

Brown . . . . . 411 






Orpen's case . . 467, 824, 826 

Orr v. Glasgow Railway Co. . 303, 411, 

568, 577*, 596 

v. Union Bank of Scotland . 483 

Orrell Colliery and Fire Brick Co. 

Osborne, ex parte 

Osgood v. Nelson . . . 303, 

Ottley v. Browne 

Oundle Union Brewery Co. 

Croxton (1 De G. M. & G. 600) 

(5 De G. & Sm. 432) 

Outlay Assurance Society . 871, 
Overend, Gurney k Co., ex parte 

(4 Ch. 460) . 165, 170*, 185, 230 
Barrow (3 Ch. 784) 
Gibb (L. R. 5 Ho. Lo. 480) 
Grissell (1 Ch. 528) 
Lintott (4 Eq. 184) 
Musgrave & Hart (5 Eq. 193) 
Oakes & Peek (3 Eq. 576) 
Walker (2 Eq. 554) 
Ward & Garni (4 Eq. 189) 

v. Gibb . . 372, 373, 374 

v. Gurney . . . 373, 374 

Owen v. Challis 31, 901 

v. Routh . . . . 499 

v. Van Uster . . 65, 205 

Oxford Benefit Building Society . 321, 
371, 373, 374, 375, 376, 388, 432, 
433, 696 
Oxford and Worcester Extension 
and Chester Junction Railway 

Barber (15 Jur. 51) 
Morrison (15 Jur. 346) 
Potter (1 De G. & Sm. 728) 
Sharp & James (1 De G. M. 
Oxford, Worcester and Wolver- 
hampton Railway Co. 
Mel ward (26 Beav. 571) 

Padstow Total Loss Association . 115, 
135, 141, 621, 622, 623, 647*, 662 
Page v. Cox ... . 589 

Pagin and Gill's case 745, 784, 785, 789 
Paklen's case, and Kelk's case . 530, 843 
Paine v. Hutchinson 493, 494, 505, 510 
Paine and Layton, ex parte . . 692 
Paine v. Strand Union . . . 221 
Painter's case . 79, 86, 412, 519, 532*, 


See Richmond and Painter's case 
Painter v. Liverpool Gas Co. . 417 
Palmer, ex parte . 524, 736, 860 

v. The Justice Assurance 

Society .... 295, 671 
Panama, &c, Mail Co, . . 197 
Panmure, ex parte . 241, 494, 512, 515 
Panonia Leather Cloth Co. . . 656 

Paper Bottle Co 659 

Paraguassu Steam Tramroad Co. 

Black & Co. (8 Ch. 254) 

Ferrao (9 Ch. 355) 

& G. 


Parbury's case (3 De G. & S. 43). 86*, 


(3 De G. F. & J. 80) . . 556 

Pare v. Clegg . . . 272, 566 
Pans v x sri s 

Paris Skating Rink Co. (6 Ch 

(5 Ch. D. 959) 

Park Gate Waggon Co. 
Parker, ex parte 


61, 603 

. 637, 648* 

70S, 956 

122, 123, 464, 835 
371, 374 

. 366*, 375, 376 

. 363 

. . 676 

123, 811, 828, 829 

S18, 819, 840, 861 

. 541 


— v. McKenna . 
Parkin v. Fry 
Parry's case . 
Parson's case 
Parson v. Spooner 
Part's case 

Partridge r. Partridge 
Patent Artificial Stone Co. 
Patent Bread Machinery Co. 

Valpy & Chaplin (7 Ch. 289) 
Patent Carriage Co. 

Gore & Durant (2 Eq. 349) 
Patent Cocoa Fibre Co. . . 659 
Patent Elastic Pavement, &c, Co. 

Armstrong (3 De G. & Sm. 

Price & Brown (3 De G. & 
Sm. 146) 
Patent File Co. . . . 203, 207 

Birmingham Banking Co. (6 
Ch. S3) 
Patent Floor Cloth Co. . 655, 887 
Patent Invert Sugar Co. . . 344, 402 
Patent Paper Manufacturing Co. 

Addison (5 Ch. 294) 
Patent Screwed Boot Co. . . 657 

Patent Steam Engine Co. . 626, 627 
Patent Ventilating Granary Co. . 404 
Paterson v. Ironside . . . 268 
Patrick v. Reynolds . . . 145 
Paul and Beresford's case (33 

Beav. 204) . . 328, 346 

(10 Jur. N. S. 692) . . . 520 

Pauling v. London and North- 
western Railway Co. . . . 227 
Pawle's case . . . 123, 777 

Payne's case .... 466, 827 
Payne v. Brecon . . . .173 

v. New South Wales Co. . 148 

Pearse's case . . . 697, 744 
Pearson's case (3 Ch. 443) . 667, 699 

(4 Ch. D. 222, aff. 5 Ch. D. 

336) . . 367, 694, 696, 790 

(7 Ch. 309) .... 709 

Pearson's Executors' case (3 De G. 

M. & G. 241) . . . .767 
Pearson v. London and Croydon 

Railway Co 399 

Peart v. The Universal Salvage Co. 295 
Pease v. Jackson . . . . 920 
Peddell v. Gwyn . . 283 

Peek's case (4 Ch. 532) . . 16, 760 

Oakes & Peek 
Peek v. Deny . 72, 73, 88, 89*, 90 

v. Gurney . 70, 88, 89, 90*, 214, 

215, 217, 470, 584 




Peel's case . 26, 29, 111, 771, 773*, 797 
Peel v. Thomas . . . 25, 95, 293 
Peirce v. Jersey Waterworks Co. . 158, 
165, 170*, HO 
Pell's case (5 CL 1 1, 8 Eq. 222) . 395, 

785 799 

— (3 De G. & S. 170). . 704* 861 

Pellatt's case . 14, 15, 17, 71 1, 769, 

778, 77'.'. 780, 781* 

Pelly, ex parte . 372, 375, 696, 697, 744 

Pelotas Cotl'ee Co. 

Karutb (20 Eq. 506) 
Pen'allt Silver Lead Mining Co. 

Fothergil] (8 Ch. 270) 
Pender v. Lushington . 309,465,566, 

I, 597 
Pendlebury v. Walker . . 266 

Penhale and Lomax, &c, Co. . 125, 615 
Peninsula Banking Co. (35 Beav. 

280) .... 673, 678 
Peninsular, West Indian, &c, Bank 
Austin (2 Eq. 435) 
Jopp'scase (W. N. 1867) 
Penkivel v. Council . . 232*, 670 
Pennant and Craigwen Mining Co. 
(15 Jur. 1192) . 641, 646*, 647 

Fenn (4 De G. M. & G. 285) 
Mayhevv (5 De G. M. & G. 837) 
Penney, ex parte .... 
Penrose v. Martyr • 
Pentelow's case . 
Pentland v. Gibson. 
Pen-y-van Colliery Co. 


. 231, 240, 253 

13, 760 

. . 266 

624, G37, 648*, 

886, 968 

. . 676 

. 865 


People's Garden Co. 

Percival, ex parte 

Percy and Kelly Nickel. &c 

Hamley (5 Ch. D. 705) 

Jenner"(7 Ch. D. 132) 
Perkins Beach Lead Mining Co. 676, 677 
Perrett's case . . . . 16, 773 
Perrier, ex parte . . 352, 852, 853 

Perring v. Dunston 

v. Hone 

Perry v. Barnett 

v. Oriental Hotels Co 


603, 675, 
677, 706 
773, 777 

Persee's case . 
Peruvian Railways Co. 
Crawley (4 Ch. 322) 
Robinson (4 Ch. 322) 
Peruvian Railway Co. v. Thames, 

&c, Insurance Co. . .185, 204 
Petre v. The Eastern Counties 

Railway Co. ... 150, 153 

Pharmaceutical Society v. London 

and Provincial Assoc. 
Phelps v. Lyle . . 270, 302, 303 
Phone v. Gillan . . .499, 806 
Philipson v. Egremont 255, 283, 290 
Phillipps, ex parte (1 Sim. N. S. 

605) . . 639, 646*, 652* 

Phillips, ex parte (2 De G. F. & J. 

634) 488 

(3 De G. & Sm. 3) . . 620, 621, 

641, 647* 
re (18 Beav. 629) . 670, 671 


Phillips V. Turner . . . . 541 
Phillipson v. Tempest . . 295 

Phoenix Life Assurance Co. . 176, 201, 
236, 312, 319, 321 
Burj i , Stocl 3 (2 J. & H. 441) 
Batton (10 W. R. 313) 
Hoare (2 J. k H. 229) 
Reeve (10 W. B. 817) 
Phosphate of Lime Co. v. Green . 179*, 
311, 312, 520, 521, 523, 532 
Phosphate Sewage Co. v. Eart- 

mont .... 355*, 361 
Photographic Artists' Association 264, 

Pickering's claim (6 Ch. 525) 

149, 240, 
. 556 
. 453 
598, 913 

Pickering, expwrte (4 Ch. 58) 

v. Appleby 

— v. Stephenson 321, 371 
Piercy r. Roberts 
Pierpoint v. Brewer 
Pilbrow r. Pilbrow's Atmospheric 

Co. . Ill, 129, 149, 247, 262, 264 
Pirn's case . 521, 802, 813, 814, 829 

Pinkett v. Wright . 456*, 465, 551 
Pinto Silver Mining Co. . 684, 870, 

882, 885 
Pitchford o. Dans . 21, 393, 410 
Pitman and Edwards, ex parte 190, 197 
Pitts r. La Fontaine . . . 861 
Planet Benefit Building Society . 633, 
638, 639, 648*, 650* 

Plant, ex parte 
Plaskynaston Tube Co. 

456, 458 
334, 396, 
401, 787 
. 677 
. 423, 517 
. 520, 596, 600 
. 545 
. 613, 662 

. 661, 706 

642, 652*, 653* 

. . 547 

. 514* 

124, 763 


Plas-yn-Mhowys Coal Co. 
Plate Glass Co. v. Sunley 
Playfair v. Birmingham, 

&c, Co. 
Plumbe v. Neild . 
Plumstead Water Co. 
Hardinge (1 N R 

v. Davis . 

Pocock, ex parte. 
Pollock v- Pollock . 

v. Stables . 

Ponsonby's case 

Pool's case (35 Ch. D. 579) 

Poole's executors, ex parte (8 Ch 

702) . . . 712, 894, 897 
Poole Fire Brick and Blue Clay 

Co. (17 Eq. 268) . . . 673, 674 
Hartley (18 Eq. 542) 

(10 Ch. 157) 

Poole v. Knott . . . . 540 

v. Middleton . 465, 499, 500* 

v. National Provincial, &c., 

Assurance Society . . 226, 328 

Poole, Jackson and WTiyte's case . 364, 

377, 669, 787 

Poppleton, ex parte . 114, 115, 135, 141 

Port of London Assurance Co.'s 

case ..... 258 

Collingridge (14 Jur. 1129) 

Portal v. Emmens . 44, 54, 59, 60, 

104, 105, 107, 293, 301, 327, 

422, 525, 791 




Portsmouth Banting Co. . . 594 

Helby (2 Eq. 168) 
Horsey (2 Eq. 168) 
Stokes (2 Eq. 168) 
Pott v. Flather . . . . 498 
Potteries, Shrewsbury and North 

Wales Railway Co. 904, 905, 907 

v. Minor .... 906 

Potter's case 692 

Potts v. Bell . . . . 37 
Poulton v. London and South- 
western Railway Co. . . . 209 
Powell v. Jessopp . . . 453 

59, 129, 256, 295. 

540, 812 

. 58, 129, 284 

. 727 

. 109, 204 

131, 132 

852, 862, 866 

60, 110, 288 

60, 110, 288, 289 


Povvis v. Butler 

■ v. Harding 

Powles v. Hargreaves . 

v. Page . 

Pratt v. Hutchinson . 
Preece and Evans's case 
Preseott, ex parte 

v. Buffrey 

v. Hadow . 

Preston v. Grand Collier Dock Co. 412, 
532, 571, 580 s , 596, 600 

v. Liverpool, &c, Railway 

Co. . 151, 152*, 153, 220, 258 

V. Melville . . . .545 

Price v. Anderson . . . . 545 

v. Great Western Railway 

Co 194 

v. Taylor . . . 233*, 234 

Price and Brown's case . . S06 
Prichard's case (5 De G. M. & G. 

484, 495) . . 671, 714, 722, 850 
Prichard's claim (2 De G. F. & J. 

354) .... 715, 849 

Prince v. Prince . . . . 228 
Prince of Wales Life Assurance 

Society . . . 247, 854 
v. Athenaeum Insurance So- 
ciety .... 169* 

■ v. Harding . . . . 169 

Princess of Reuss v. Bos . Ill, 112, 116, 
135, 468, 619, 622, 636, 645*, 912 
Printing and Numerical Register- 
ing Co. ... 678, 719, 720 
Pritchard's case (8 Ch. 956) . 395, 784 

(2 Ch. 714) .... 774 

Pritchard v. London and Birm- 
ingham, &c, Railway Co., re 

Weiss 706 

Professional, &c, Building So- 
ciety . 619, 633, 639, 650*, 922 
Professional Life Assurance Co. . 251, 
737, 742, 866 
Progress Assurance Co. . . 681 
Prosper United Mining Co. . 94, 326 

Palmer (7 Ch. 286) 
Pugh and Sharman's case (13 Eq. 

566) . . .59, 803, 808, 811 
Pulbrook, ex parte (4 Ch. 627) . 704 
■ (2 De G. J. & S. 349) . . 878 

v. New Civil Service Co- 

operation . . . 891 

v. Richmond Consolidated 

Mining Co. . . 301, 567, 599, 794 

Pulsford v. Richards 
Purcell's case 


19, 70, 71, 76* 
. 301 

Quartz Hill Gold Mining Co. v. 

Eyre 614 

Quebrada, &c, Copper Co. . . 403 
Queen's Benefit Building Society . 619, 

655, 922 
Queensbury Industrial Society v. 

Pickles .... 263, 915 
Quilter, ex parte . . . . 724 

Rai>e:n t hup„st v. Bates 

Radley v. Bramall . . . . 

Rail and Electric Appliance Co. 

Railway Finance Co. . 

Railway Sleepers Supply Co. 305 

Railway Steel and Plant Co., ex 

In re Taylor (8 Ch. D. 183) 





Li re Williams (8Ch. D. 192) 

678, 719 
Railway Time Tables Publishing 


Ralph v. Harvey . 
Ramsay's case 
Ramsgate Victoria 
v. Montefiore 

127, 819, 820, 986 
Hotel Co. v. 

. 13, 15 
13, 15 

Ramskill v. Edwards 349, 374, 376, 

Ranee's case 371, 414, 430, 433, 694, 
695, 696, 787, 854, 881, 885 
Randell v. Trimen . . . 241 
Ranelagh v. Haynes . . 588, 589 
Ranger v. Great Western Railway 

Co 211, 227, 595 

. 286, 294 

. 137 

. . 849 

Ransford v. Bosanquet 

v. Copel and 

Rapier v. Wright . . . . 

Rasbotham v. Shropshire Union 
( 'anal Co. .... 

Rashdall v. Ford . . . . 

Rastrick v. Derbyshire, &c, Rail- 
way Co. . 60, 104, 291, 292 

Rawlins v. Wickham . 

Read v. Anderson 

v. Blunt 

Reaveley's case . 

Reddish v. Pinnock 

Redgrave v. Hurd 

Reece v. Taylor . 

Rees v. Ferine 

Reese River Co. v. Smith 

Reeve's case . 

Reeves v. White 

Regent's Canal Ironworks Co. 
Grissell (3 Ch. D. 411) 

Regent United Service Stores 
" Bentley (12 Ch. D. 850) 




. 72 

t88, 469, 512 

. . 544 

828, 860 

. . 565 

72, 73 

. 460 

. . 488 







656, 679 



. Arnaiul .... 36 
y. Aspinall . . 87, 488 

•. Bank of England . 604, 605 
v. Beard . . . 268, 270 

o. Bigg .... 220 
r. Birmingham . 172, 173 

v. Burgiss .... 268 
.-. < iambridge . . . 605 

. i axnatic Railway l '<>. 42, 61 

■ v. Caster . . . 268, 270 

■ v. Cawood . . .130 

■ v. Cemetery Co. . . . 

- v. Chester .... 
<■. I Hear . . . 

■ v. Cockermouth Enclosure 


■ v. Cooper 
• v. Cumberland . 221, 265 

- v. De Berenger . . . 488 

- v. The Derbyshire Railway 

Co. 282, 292, 296, 297, 604 

- v. Dodd . . 131*, 245, 246 

- v. D'Oyly .... 

- v. Eastern Archipelago Co. 

- v. Esdaile . . . 87, 433 

- v. Frankland 

- v. The Fraternity of Hostmi n 

in Newcastle-upon-Tyne 

- v. Gaskarth 






v. General Cemetery Co. 

63, 109, 

— o. Government Stock Invest- 

ment < !o. . . . 311 

— v. Grand ('anal Co. . 440 

— I?. Grimshaw . . 307 

— v. Gurney . . . 87 

— v. Hammond . . . 332 

— 17. Harrald . . 311 
— 17. Haythorne ... 98 

— v. Hughes .... 98 

— v. Ingall .... 173 

— v. Inns of Court Hotel Co. . 466 
— 17. James . . . 268, 270 

— 17. Kelk 310 

— v. Lambourn Valley Railway 

Co. . . 603, 604, 605 

— 17. Langton .... 112 

— v. Larwood . . . . 98 

— v. Liverpool, Manchester, &c. 

Railway Co. . 61, 466, 605 

— v. London Assurance Co. . 604 

— v. Londonderry Railway Co. 

416, 423, 425, 604 

— 17. Mariquita Mining Co. 440, 604 

— v. Mayor of Stamford . 221 

— v. Mildenhall Savings Bank 916 

— v. Miller .... 98 

— v. Mott 394 

— 17. Osbourne ... 99 

— v. Pasmore . . . . 98 

— v. Pritchard . . .268 

— i'. Registrar of Friendly So- 

cieties . . 112, 917, 938 

— y. Registrar of Joint-Stock 

(10 Q, B. 839) . . Ill, 113 

(21 Q. B. D. 131) 61, 395, 605, 1022 



. 173 

v. Saddlers' Co. . 

. 604 

i>. St. Catherine Dock Co. 

280, 604 

17. Shropshire, &c. Canal Co. 604 

v. Shropshire Union Rail- 

way < !o. . 

54, 61, 64 

». Stafford . 


p. Stainer 


p. Stratton . 


V. Tewkesbury 

. 300 

17. Thomas . 

. 311 

17. Timothy 


p. Trafford . 

. 916 

v. Victoria Park Co. 

280, 412, 


17. Watson 


17. Webb . 

L31*, 132* 

17. Whit marsh . Ill 

,117, 128, 

131, 138 

17. Whitstable Co. 

. 604 

— v. The Wilts and Berks Canal 

Co. . . . 440, 604, 605 

v. Wimbledon Local Board. 311 

17. Windham . . . . 605 

v. Wing . . 423, 425, 604 

17. Worcester Canal Co. . 604 

17. York 605 

Reid's . . . 39, 810,828 

R id y. Allan .... 248 

v. Explosives Co. . 73 

Reidpath's case . . . 14 

Remfry 27. Butler . . . 496 

Rennie r. Clarke . . . 145 

17. Morris . . 501, 503, 510 

v. Wynn . . . . 145 

Reuss (Princess of) v. Bos 111, 112, 116, 

135, 468, 619, 622, 636, 

645*, 912 

Reuter 17. Electric Telegraph Co. . 160 


128, 144* 


456*, 563 

'. 41, 807 

. 661 

. 247, 249 

. 638, 652* 

626, 64'j . 654 

Reynell v. Lewis 
Reynolds 17. Bassett 
Rheam v. Smith 
Rhodes, ex parte . 

17. Dawson . 

v. Forwood . 

Rhydydefed Colliery Co 
Pica Gold Washing Co. 
Richard r. Home Assurance Asso- 
ciation ... . • 
Richards & Co. . 677, 678, 711 
Richards v. Home Assurance As 

sociation . 
Richardson's case 
Richardson 17. Hastings 

17. Larpent . 

17. Williamson 

Richmond's case (4 K. & J. 305) . 79, 
86*, 412, 519, 532*, 534, 839, 845 
Richmond's Executors' case (3 De 

G. & Sm. 96) . . 518, 838, 862 
Richmond's Executors (13 Jur. 

727) 814 

Richmond Hill Hotel Co. 

Elkington (2 Ch. 511) 

King (3 Ch. 10) 

(4 Eq. 566) 

Pellatt (2 Ch. 527) 


14, 770 
803, 811 
565, 621 
377, 573 
242. 920 




295, 540 
. 749 



Ricketts v. Bennett 

v. Eowhay 

Riddell, ex parte .... 
Riddick v. Deposit, &e. Ass. Co. . 
Ridgway v. Philip 
v. The Security, &c. Ass. 

Society ... . . 
Ridley v. Plymouth Grinding and 

Baking Co. , 154, 156, 200, 226 

Rigby v. Connol . . . . 528 

v. Dublin Trunk Railway Co. 291, 


Risca Coal and Iron Co. . . 710 
Ritso's case 
River Steamer Co. 

Mitchell (6 Ch. 822) 
Rivington's case . 
Roberts' case (3 De G. & S. 

2 Mac. & G. 192 and 14 

Roberts, ex parte (1 Drew 

Rio Grande do Sul Steamship Co. 

13, 770 



766, 778, 
•204) 15, 
766, 861, 863 

. 710, 821 
. 603 

. . 26S 



321, 366- 
. 147 

v. Crowe 

v. Eberhardt 

Robertson v. Sheward 
Robinson, &c. Brewery Co. 

Sidney (13 Eq. 228) 
Robinson's case (4 Ch. 322) . 14, 863 
Robinson's Executors' case (2 De 
G. M. & G. 517) . 759, 776, 782, 812 

(6 De G. M. & G. 572) 245, 426, 

428, 537, 848 

Robinson v. Burbridge 

v. Chartered Bank . 

v. Mollett . 

v. Sheward 

v. Thompson 

v. Trevor 

Robson v. Dodds 

v. The Earl of Devon 

v. McCreight 

78, 590 
251, 671, 672 

Rochdale Property and General 

Finance Co. 684, 708 

Roe v. Fuller .... 269 
Rofl'e v. Roscoe . . . . 475 
Rogers' case (3 Ch. 633) . 17, 778* 
Rogers' trusts (1 Dr. & Sm. 338) 547 
Rogers, ex parte (15Ch. D. 207 . 488 

v. Oxford, &c. Railway Co. 321, 

568, 601 
Rolling Stock Co. of Ireland 
Shackleford (1 Ch. 567) 
Rolt v. Hopkinson . . . . 459 
Rome v. Young .... 727 
Romford Canal Co. . 168, 171*, 193, 

194, 741 
Roney's case . 301, 313, 791, 797 

Roots v. Williamson . 476, 477, 479 
Rose & Co. v. Gardden Lodge Coal 

Co 673 

Rosewarne v. Billing . . . 
Ross v. Army and Navy Hotel Co. 

v. Estates Investment Co. 
v. Moses ... 







Rossmore v. Mowatt 
Rotheram Alum, &c. Co. 
Rotherhithe, &c. Society . . 

Routh v. Webster 
Royal Bank of Australia 

Boyds (1 De G. & J. 223) 
Cockbum (4 De G. & Sm. 177} 
Connell (29 L. J. Ch. 649). 
Latta (3 De G. & Sm. 186) 
Meux's Executors (2 De G. M. 

— (4 D~e G. & Sm. 331) 
Robinson's Executors (6 De G. M. & 
G. 572) 

(2 De G. M. & G. 517) 

Sutton (3 De G. & Sm. 262) 
Walker (15 Jur. 853) 
Royal Bank of India's case 43, 167, 774, 

806, 807 
Royal Bank of Scotland v. Cuth- 
bert ..... 

Royal British Bank (3 Jur. N. S. 


Brockwell (4 Dr. 205) 
Frowd(9 W. R.) 
Mixer (4 De G. & J. 575) 
Nicol (3 De G. & J. 387) 
Walton & Hue (3 Jur. N. S. 853) 

v. Turquand 165, 167*, 169*, 174, 

190, 199- 
Royal Exchange Assurance Co. v. 
Moore .... 

v. Vaughan 

Royal Hotel Co. of Great Yar- 
mouth .... 
Royal Liver Friendly Society 
Ruby Consolidated Mining Co. 

Askew (9 Ch. 664) 
Rudge v. Bowman . 488, 494, 837 

Rudow v. Great Britain Mutual 

Life Assurance Society . 621, 677, 
682, 985 
Rugby, Warwick, &c. Railway Co. 

Preece & Evans (2 De G. M. & G. 
Rule v. Jewell . . 326, 535, 582 
Rumball v. Metropolitan Bank 67, 472, 

Rumney's case .... 735 
Russell v. Croysdill . . 263, 706 

v. East Anglian Railway Co. 603 

v. Reece .... 240 

v. Wakefield Waterworks Co. 563, 

566, 570, 571, 572 
Russian (Vyksounski) Iron Works 

Co 20*, 26 

Kincaid (2 Ch. 412) 
Stewart (1 Ch. 574) 
Taite (3 Eq. 795) 
Webster (3 Eq. 740) 
Whitehouse (3 Eq. 790) 
Rutherford's case . . 806, 835 

Ruthin & Cerrig-y-Druidian Rail. 

Act 904 

Pattter v. Chapman ... 98 
Rye's case .... 20*, 772 
Ryland v. Delisle . . .428 

49 1 





Sablonieke Hotel Co. . . . 073 
Sadler's case . . . .42, 808 
Sahlgreen's and Carrall'a case 14, 841 
St. George's Building Society 019,647* 
St. I (eorge Steam Packel « lo. 
Cropper (1 De G. M. & G. 

Hamer (2 De G. M. & G. 366 

and 3 De G. & Sin. 279) 
Hennessey (2 .M. & G. 201 and 

3 Dc (i. .v Sm. 191) 
Litchfield (3 De G. & Sm. 141) 
Maguire (3 De G. & Sm. 31) 
Pirn (3DeG. & Sm. 11; 
St. James's Club . . . 617, 620 
St. Marylebone Joint Stock Bank- 
ing Co. See Marylebone. 
Walker (8 1 >e G. M. & G. 607) 
St. Nazaire Co. . . 663, 698, 748 
St. Thomas' Dock Co. . 636, 637, 652* 
Salman v. Hamburg Co. . . . 279 
Salomans v. Laing . . 322, 571, 580, 
597, 598, 892 
Sander's case . . 737, 758, 836 
Sanderson, ex parte (1 Mac. & G. 

306) 698 

Sanderson's case (3 De G. & S. 66, 

and 3 H. L. C. 698) . 84, 85*, 254, 

698, 749, 758, 824, 830 

Sanderson's Patents Association . 641, 

646*, 649 

Sandy's case . . . 787, 789* 

Sangster v. Cochrane . . . 920 

Sankey Brook Coal Co. . . 192 

Kadly & Bramall (12 Eq. 472) 

v. Marsh . . . 739, 74 1 

Sargent, ex parte . 122, 124, 316, 467, 

479, 500 
Sargood's claim .... 725 
Saunders' case . 780, 791, 795*, 805 

Savin v. Hoylake Railway Co. . 147 
Saxon Life Assurance Society . . 184, 
258, 261, 735, 864, 892 
Anchor (2 J. & H. 408, and 

1 De G. J. & Sm. 29) 
Era (2 J. & H. 408, and 1 De 
G. J. & Sm. 29) 
Sayles v. Blane . . . 472, 506 
Scadding v. Lorant . . . 307 
S earth v. Chad wick , . . 569 
Schanschieff Electric Battery Syn- 
dicate 882 

Schibsby v. Westenholz . . 914 
Scholefield v. Redfern . . . 547 
Scholey v. Central Railway Co. of 

Venezuela . . . .85, 777 
Schomberg, ex parte . . . 549 
Schroder's case (11 Eq. 131) . 395, 786 
Scinde, &c, Bank Corporation . 882 
Scinde, Punjaub, and Delhi 




Scinde Railway Co. 


Scott v. Berkeley . 


v. Clifton School Board 


v. Colbum . 



■ — — v. Ebury (Lord) 



v. Hastings (Lord) 



. Izon . . . ■ • 583 
v. Mayor of Manchester . 209 

Scottish Petroleum Co. . 21, 124, 157, 

418, 777 
Anderson (17 Ch. D. 373 
Scottish and fTniversal Finance 

Bank 20*, 25 

Ship'- case (2 De G. J. & Sm, 
Scrimgeour's claim . . . - r >l I 
Scully, ex parte . 802, 803, 826, 831 

Sculthorpe v. Tipper 

Sea, Fire and Life Assurance Co. 
Greenwood (8 De G. M. & G. 

Gwvu (1 Jur. X. S. 
1 \ hi of London Assurance Co. 
(5 De G. M. &G. 465) 
Sea, River and Marine Insurance 


Seaton v. Grant . . . • 
Seddon v. Connell 
Sedgwick, ex parte 
Seidler, ex p 
Selwyn v. I hi rison 



. . 568 

561, 564, 592, 595 

388, 627, 646*, 858 

. 661 

382, 387* 














Serrell v. The Derbyshire, Staf- 
fordshire, &c., Railway Co. 227, 232 1 
Sewell's case . . . 393, 402, 7 / 4 
Seymour v. Bridge . . . 489 
Shackleford's case . . 14, 17*, 778 
Shackleford v. Dangerfield 
Sharman's case 
Sharon's claim . 
Sharp and James's case . 

Sharp v. Dawes . 

v. Stewart & Co. 

v. Taylor 

Sharpe v. Day 

Sharpley v. South and East Coast 

Railway Co. .... 584 
Sharpus's case . . 664, 761, 771 
Shaw's claim (10 Ch. 177) . 147, 722 
Shaw, ex parte {18 Eq.. 16) . . 123 

(2 Q. B. D. 463) . 121, 123, 124, 500 

v. Benson . . 115, 135, 141 

v. Fisher . . .64, 473, 492 

v. Holland . . . 117, 498 

v. Port Philip Gold Mining 

Co. 64, 484* 

v. Rowley . . 416, 418, 498 

v. Simmons . . .114 

Shears v. Jacob . . . . 203 

Shedden v. Patrick . _ . .283 
Sheehy v. Professional Life Assur- 
ance Co. ..... 914 

Sheerness Waterworks Co. v. 

Poison 708 

Sheffield's case (Johns. 451) 73, 84*, 

85*, 86*, 166, 772 

Sheffield, The Earl of v. London 

Joint Stock Bank . . . 

Sheffield, &c. , Gas Co. v. Harrison 



Sheffield and Hallamshire Ancient 
Order of Foresters 

Fountain (11 Jur. N. S. 553) 



Sheffield, &c. Railway Co. v. 

Woodcock . 49*, 51, 108, 328, 329, 

416, 419, 421 

Sheffield Nickel Co. v. Unwin 165, 334, 

Sheffield and S. York Permanent 

Building Society . . . . 524 
Shepherd's case . 121, 466, 833, 835 
Shepherd v. Gillespie . 493, 505, 510 
Sheppard v. Murphy 491, 505, 506, 510 

v. Oxenford 133, 135, 139*, 565, 

593, 594 

v. Scinde, Punjaub, and Delhi 

Railway Co 870 

Sherrington's case . . . 779 
Sherwood Loan Co. . 627, 642, 647" 

Smith (1 Sim. N. S. 165) 
Shewell's case . . 747*, 799, 804 
Shield v. Great Northern Railway 

Co 38, 911 

Shields Marine Insurance Associ- 
ation 621, 655 

Lee & Moor (5 Eq. 368) 
Ship's case . . 20*, 25, 122, 625, 749, 

754, 772 
Ship v. Croskill 
Shipman's case 
Shirreff's case 
Shortridge v. Bosanquet 


ShrapnelPs case 
Shrewsbury, Earl of 
Stafford Railway Co. 

71*, w . 


730*, 731 

, 61, 423, 

560, 596 

. 810, 828 


147, 150, 151, 


Shrewsbury and Birmingham Rail- 
way Co. v. North Western 
Railway Co. . . . 202 

r. Stour Valley Railway Co. 323 

Shrewsbury and Leicester Direct 
Railway Co. 
Riddell (1 Simons, N. S. 402) 
Shrimpton v. Sidmouth Railway 

Co 292 

Shropshire Union Railway and 

Canal Co. v. Anderson 59, 60, 
108, 414, 421 

v. Regina . 54, 64, 104, 485 

Sibley v. Minton ... 95, 560 
Sibson v. Edgworth . 33, 565, 567 

Sichell's case (3 Ch. 119) . 124, 125, 

806, 836 
Sichell, exparte (1 Sim. N. S. 187) 765*, 
860*, 861, 862 
Siddall, re .... 115, 135 
Sidney's case . 761, 763, 793, 797, 839 
Silber Light Co. v. Silber . . 573 
Silkstone and Dodworth Iron Co. 680 

Whitworth (19 Ch. D. 118) 
Silkstone Fall Colliery Co. . . 877 
Silver Valley Mines (18 Ch. I . 

472) 615 

(21 Ch. D. 381) . . . 863 

Simm v. Anglo-American Tele- 
graph Co. . 54, 60, 64*, 484, 787 
Simons v. Patchett . . . 241 
Simpson's case (9 Eq. 91) . . 122 
(4 Ch. 1S4) . . .778 


Simpson's claim (36 Ch. D. 532) 161, 

Simpson v. Denison . 321, 323, 571, 598 
— — v. Lord Howden . . .153 

v. Rand . . . . . 513 

v. "Westminster Palace Hotel 

Co. . . 202, 317, 566, 570, 601 
Singleton v. Selwyn . . . 570 
Sir John Moore Gold Mining Co. 878 
Skegness Tramway Co. . . . 147 
Skinner v. City of London Marine 

Insurance Corporation 63, 124, 470, 

v. Lambert 

Shatter's Executors 
Slattery's case 
Slim v. Croucher 
Small v. Attwood 

v. Smith 

Smallcombe's case 

Smallpage's case 

Smart v. West Ham Union 


267, 427, 565 

. 688, 861 


. . 213 

271, 566 

. 200, 922 

•^19*, 522, 523, 822 

. 861 


Smith's case (2 Ch. 604 & 4 L. R. 

H. L. 64) 
- (1 Ch. D. 481) 

(4 Ch. 611) 

(4 De G. & J. 544) 

Smith, ex parte (1 Sim. N. 

■ (3 Ch. 125) . 

(39 Ch. D. 546) . 

Smith, Fleming & Co. 's case 

123, 771, 777 

. . 872 

53, 759, 761 


S. 165) 619 

715, 743, 865 

14, 156, 157, 

158, 305 

.85, 709, 


672, 691 

Smith, Knight & Co. , re . 

Ashbury (5 Eq. 223) 

Gibson (4 Ch. 663) 

Weston (6 Eq. 238) 

(4 Ch. 20) 

Smith, Mackrill, re (3 Ch. 125) . 678 
Smith v. Anderson . 114, 135, 141 

v. Birmingham Gas Co. . 209 

v. Cannan . . . . 549 

v. Chadwick . 21, 71*, 89, 590 

v. Cork and Bandon Railway 

Co 401 

v. Goldsworthy . 267, 299, 320, 

322, 393*, 427, 565 

v. Hull Glass Co. . 154, 159*, 160, 

161, 163, 168*, 178*, 205 

v. Lloyd .... 916 

. Manchester (Duke of) . . 321, 
571, 599 

c. Morgan .... 

v. Pilkington . . . . 

v. Reese River Co. 

. . 920 
. 73, 75*, 76, 
213, 428, 597 
520, 526, 840 
. . 40 

Snell's case 
Sneyds, ex pari . 
Snook v. AVatts 
Societe Generale de Paris 

Geen (8 App. 606) 

Walker (11 App. 20) 

v. Tramways Union Co. . 205 

v. Walker . 205, 454, 470, 472, 

476, 477*, 479*, 490 
Society of Practical Knowledge v 

Abbott . . 163, 278, 315, 370* 



Snincs v. Currie . 
Soulby v. Smith 
Southall r. British 

Assurance Sm-ictv 


60, 122, 271, 769 
98, 454, 870 
. . 267 
Mutual Life 

367, 598, 601, 
894, 895 
Southampton Dork Co. v. Arnett 409 

v. Richards . 59, 106, 313, 409*, 

Southampton, [sle of Wight, &c, 
Steamboat Co. 

Bird (4DeG. J. & S. 201) 
Eopkins' Executors ( 1 Do G. 

■I. & S. .".12) 
Webb (9 Jut. N. S. S56) 

v. Rawlins .... 264 

South Barrule Slate Quarry Co. . 663, 

882, 890 
Sou th Blackpool Hotel Co. 
James (8 Eq. 225 
Migotti (4 Eq. 238) 
South Carolina Bank v. Case . 909 
South Durham Brewery Co. . . 118, 
261, 322, 334, 344, 396, 405 
South Durham Iron Co. 

Smith (11 Ch. D. 579) 
South - Eastern Railway Co.'s 

claim ...... 806 

South - Eastern Railway Co. \ 

Hebblcwhite . 300, 409, 411, 414 
Southern Railway Co. . . . 279 

South Essex Estuary Co. 
Chorley (11 Eq. 157) 
Paine & Layton (4 Ch. 215) 
South Essex Gas Light and Coke 

Hulett (2 J. & H. 306) 
Stears (Johnson, 480) 
South of France Co. 

Baron de Beville (7 Eq. 11) 
South of Ireland Coll. Co. v. 

Waddle . 220, 222, 223, 228 

South Kensington Co-operative 

Stores . . . . 680, 681 

South Lady Bertha Mining Co. 619, 646* 
South Llanharran Colliery Co. 

Jegon (12 Ch. D. 503) 
South London Fish Market Co. . 464, 
620, 628, 648, 825, 829 
South port and "West Lancashire 
Banking Co. 

Fisher (31 Ch. D. 120) 
Sherrington (31 Ch. D. 120) 
South Staffordshire Railway Co. 

v. Burnside . . 551, 555, 815 
South "Wales Atlantic Steamship 

Co 135, 621 

South Wales Railway Co. v. 

Redmond .... 200 

Southwark Water Co. v. Quick . 595 
South "Western Loan Co. v. 

Robertson . ... 461 

Spackman's case. See Spackman 

v. Evans 
Spackman, ex parte (1 De G. & S. 

599 & 1 Mac. & G. 170) . 617, 
649*, 901 


Spackman v. Evans 53, 179, 312 

520, 522, 523, 532, 538, 845 

v. Lattimore . 24, 147, 598 

Spargo's rase . . . 743, 784, 785 
Sparks v. Liverpool Waterworks 

Co 535 

Sparling <\ Parker . . .1 l'.>. 152 
Sparrow v. Fanner . . . 920 

Spence's case (17 Beav. 203) . . 426, 

— (6 Ch. 362) . . . 260 

nt Co. 

, 735 




. 569 

766, 767 



, 892 




Spence's Patent, &c 

I 0. New Inn 

Spiller v. Johnson 

v. Maude 

v. Paris Skating Rink 

Spittal v. Smith 
Spottiswoode's rase 
Spui gin /-. White. . . . . 
Stace and Worth's case . 17, 53, 
184, 323, 759, 774* 
Stafford (Mayor of) v. Till . 
Staffordshire and Shropshire Rail. 

Bowen & .Martin (20 L. J. 

Ch. 856) 

Stainbank v. Femley . . 592 

Standing v. Bowring . 

Stanhope's case 1 1 Ch. 161) . 3D:. 520, 

523, 532, 538, 845 

(3 De G. & Sm. 198) . . 518*, 

838*, 839, 862 
Stanhope Silkstone Collieries Co. 678 
Stanley's case . . . . 192 

Stanley v. Chester and Birkenhead 
Railway Co. . . 150, 15 

Stapleford Colliery Co. 

Barrow (14 Ch. D. 432) 
Stapleton, ex parte . . . 861 
Stark v. Highgate Archway Co. . 186 
State Fire Insurance Co. . 249, 737 
Meredith's case and Conver's 

case (1 N. R. 510) 
Times Assurance Co. (2 Hem. 
& M. 722) 
Steadman v. Arden ... 30 
Steam Stoker Co. . . . 626 

Stearic Acid Co. ... 307, 879 

Stears, ex parte . . . 226, 328 
Stears v. South Essex Gas Co. . 328 
Steele v. Harmer . . . . 185 

v. North Metropolitan Rad- 

way Co. 

v. Sutton Gas Co. . . . 

Steigenberger v. Carr . 
Stent v. Bailis . . . . 

Stephen, re (2 Ph. 562) 
Stephens, ex parte (3 Ch. 753) 

v. De Medina 

Stevens, re (Ir. Rep. 6 Eq. 604) . 

v. Guppy . . . . 

v. Mid Hants Railway Co. . 

v. Midland Counties Railway 

Co. ... . 

v. South Devon liailwav Co. 

401, 429, 430, 572, 600 
Stevens' Hospital v. Dyas . . 223 





Stevenson, ex parte (32 L. 
97) . 

v. McLean 

Steward v. Dunn 

v. Greaves 

Stewart's case (1 Ch. 574) 


J. Ch. 

. 855 

. . 14 

110, 268, 269 

. 268, 604 

. 21*, 26*, 

122, 312, 772 


(1 Ch. 511) 
Stewart v. Anglo -Californian Gold 
Co. ... 45, 59, 64 


v. Cauty 

Stirling's case 
Stirling v. Maitland 
Stock's case (2 J. & H. 441) 

(22 L. J. Ch. 218) 

(4 De G. J. & Sm. 426) 



817, 818 

. 729 

. 178, 

180, 199 

765, 766 

. 301, 

790, 795 


585*, 587 

679, 721 

124, 458 

822, 830* 

220, 690 

Stocken's case 
Stocker v. "Wedderburn 
Stockton Iron Furnace Co. 
Stockton Malleable Iron Co 
Stoke's case 
Stone's case . 

Stone v. City and County Bank . 753, 
776, 877, 880 
Storforth Lane Colliery Co. . . 686 
Storm v. Sterling .... 230 
Stratfon's Executors' case . 52, 316, 
751, 758*, 812, 824, 860 
Straker v. Wilson . . . 545, 546 
Strand Music Hall Co. . .193 

European and American Finance 
Co. (35 Beav. 153) 
Strang, ex parte . . . 557, 743 
Stranton Iron and Steel Co. . 309, 

464, 465, 466 
Barnett (19 Eq. 449) 
Stratford and Moreton Railway 

Co. v. Stratton . . 416, 417 

Stray v. Russell . 467, 491, 493, 496, 

501, 506*, 514 

Strick v. Swansea Tin Plate Co. . 528, 


Stringer's case (4 Ch. 475 & 493) . 278, 

414, 430, 433, 694, 695, 696, 787, 854, 

Stringer, ex parte (9 Q. B. D. 436) 459, 

. 543, 546 
. . 436 
. 532, 535* 

Stroud v. Gwyer 
Stuart v. Lord Bute . 
Stuart's Trusts, re . 
Stubb's case 
Stubbs v. Lister 
Studdert v. Grosvenor 

321, 322 
Studley, ex parte 
Stupart v. Arrowsmith 

.71, 598, 599 
. . 765* 
317, 583*, 
Sturge v. Eastern Union Railway 

Co 401, 569 

Sturt & Co 

Pearcy (13 Eq. 309) 
Styles v. Cardiff Steamboat Co. . 205, 


Suburban Hotel Co. . 632, 633, 634, 

639, 641, 650* 

Suche & Co. (Joseph) . 685, 719, 720 
Sudlow & Kingdom, re . . . 670 
Sudlowu. Dutch- Bhenish Railway 

Co. ... 528, 909, 913 

Sullivan v. Mitcalfe ... 92 

Sunderland Universal Building 

Society . 614, 619, 627, 876, 922 
Sunderland Marine Insurance Co. 

v. Kearney .... 
Sunken Vessels Recovery Co., 


Wood (2 De G. & J. 85) 
Sutton's case .... 
Sutton v. Tatham . . . • 
Swan's case (10 Eq. 675) 
Swan, exparte (7 C. B. N. S. 400) or 
v. N orth British Australian 

Co. 62, 472, 486*, 487 

Swansea Dock Co. v. Levien . 300, 

Swansea Friendly Society . . 43 





Sweeting v. Pearce 
Sweny v. Smith 
Swift v. Jewsbury 

v. Pannell 

Swire v. Francis . 
Sykes' case 
Sykes v. Beadon . 
Symes v. Hughes 
Symon's case . 


. 532, 534, 571 

207, 217 

. . 198 

. 217* 

. 377, 669, 786 

114, 135, 140, 141 


. 123, 811 828 

247, 466, 601 

Taft o. Harrison 
Tahiti Cotton Co. 

Sargent (17 Eq. 273) 
Taite's case ..... 28 
Talbot's case . 250, 251, 412, 854, 862 
Tal-y-Drws Slate Co. 

Mackley (1 Ch. D. 24) 
Tambracherry Estates Co. . . 403 
Tanner's case .... 766 
Taunton v. Royal Insurance Co. 161, 
163, 318, 599, 601 
Taurine Co. . 156, 664, 665, 822, 824, 
825, 832, 878 
Tavarone Mining Co. 

Pritchard (8 Ch. 956) 
Tavistock Ironworks Co. 

Lyster (4 Eq. 233) 
Tayler v. Great India Peninsula 
Railway Co. . 62, 473*, 4 

Taylor, Exparte (14 Ch. D. 398) 

v. Blakelock 

v. Bowers . . . . 

v. Chichester and Midhurst 

Railway Co. . 
v. Crowland Gas Co. 


v. Dulwich Hospital 
v. Hughes 52, 56*, 


38, 148, 280, 


220, 221 

61, 423, 466, 

560, 596, 597 

. . 254 


v. Ifill .... 
v. Lendy 
v. Pilsen, &c, Light Co. 334, 344, 
402, 602 
v. Rundell . . . 441, 595 

a i i iioKiMi.s i;i.ri.l;khi> To. 



Taylor V. Salmon . . . 566 

v. Stray. . . . 507,513* 

v. Taylor . . . .813 

Teasi laic's case . 102,526,530,840 
Teete'a case .... 732, 735 
Teignmouth, &c, Shipping Asso- 

.Martin (11 Eq.. 148) 
raph Construction Co. . 403, 732 
Telegraph Despatch Co. v. McLean 247, 

Telford v. Metropolitan Board of 

Works 324 

T mr Valley Railway Co. 
Forbes (lit Eq. 353) 
Tempest v. Kilner . 453, 498, 499 
Tenant v. Elliott . . . . 140 
Tennant v. City of Glasgow Bank ! 53, 

Tepper v. Nicholls . . . 452 
Terrell's case .... 126, 148 
Terrell v. Hutton 148, 149, 714, 722, 72 1 
Teversham v. Cameron's Coalbrook 

Co. . . . 193, 226, 328, 388 

Thacker v. Hardy . . . 488, 501 

Thames Haven Dock Co. v. Hall 221, 

265, 415, 428 

v. Rose 157, 174*, 299, 409, 415, 

428, 604 
Thames Plate Glass Co. v. Land 

and Sea Telegraph Co. 673, 675, 699 
Thames Tunnel Co. v. Sheldon 19, 420 
Thetford School case . . . 312 
Theys, ex parte 697, 719, 739, 740, 744 
Thomas's case (13 Eq. 437) . 520, 840 

(1 De G. J. k S. 579) . . 812 

Thomas, ex parte (18 Eq. 17, note) 123 

(9 C. B. 740) . . . . 848 

v. Bishop . . . 231, 232* 

v. Clark . . .95, 254 

v. Hobler . . . 254, 567 

v. Patent Lionite Co. 665, 673, 678, 

680, 717, 720, 721, 878, 96S, 969 

v. Wells . . . 60S, 672 

Thompson v. Harding . 59, 129, 288, 

v. Norris . . . 671, S50 

v. Planet Building Society 916, 921 

v. Universal Salvage Co. 1S5, 295, 

v. "Wesleyan Newspaper Asso- 
ciation .... 185 
Thomson's case (4 De G. J. & Sm. 

749) 778, 779 

Thorn v. Croft .... 920 
Thornton, ex parte . . . 2S2, 666 

v. Ellis .... 


v. Kempson. . . . . 


Tierney, re . 


Tilleard, re ... . . 


Tilson v. Warwick Gas Light Co. 


Times Fire Assurance Co. 625, 



, 660 

Times Life Assurance, &c, Co. (5 

Ch. 381) .... 260* 


(9 Eq. 382) .... 


Timms v. Williams 



Tipperary Joint Stock I tanking Co. 
Ginger 5 Ir. Ch. Rep. 171) 
Scully (6 lr. Ch. Rep. 72) 
Stirling (6 Ir. Ch. Rep. 180) 
Tippetl v. Johns . . . . 95, 96 
Tobin, t ' pa/rte .... o7l' 
Todd r. Wright . . . . 268 
Toll v. Lee . . .95, 96, 294 

Tomkinson v. Smith Eastern Rail- 
way Co. . . 322, 571, 579, 599 
Tomunsonu Tomlinson . . 152 
Tondeur, ex parte . . . . 729 
Tooke, ex parte .... 416 
Topham v. Greenside Fire Brick 

Co 196, 198 

Torkington, ex parte . . 269, 550 
Torquay Hath Co. . . 115, 614, 875 
Torrington v. Lowe . . . 509 
Tosh v. North British Building 

Society . . 524, 861, 872, 920 
Tothill's case . . 313, 790, 795" 
Totterdell v. Fareham Brick Co. 

156, 161, 228, 338 
Totty, ex parte . . . . 709 
Touche v. Metropolitan Railway 

Co 148, 158 

Towne v. London and Limerick 

Steamship Co. . . . 264 

Towns I >rainage Co. 

.M,r ]o| 

Townsend's case . . . 14, 15 

Townsend v. Ash . . . 451 
Trade Auxiliary Co. v. Vickera . 578 
Traders' North Staffordshire 

Carrying Co 680 

Trades Bank Co. ... 686 

Traill v. Baring . . . 70 

Transatlantic Co. v. Pietroui . 913 
Tredinnick v. Oliver . . 454, 463 
Tredwen v. Bourne 25, 64, 95, 192, 205, 

Trent & Humber Co. 

Bailey and Leetham (8 Eq. 

Cambrian Steam Packet Co. 
(4Ch. 112 and 6 Eq. 396) 
Trent Valley, Chester, &c, Rail- 
way Co. 

Dale (3 De G. & Sm. 11) 
Tretoil & Messer Mining Co. 619, 646*, 


Trevor v. Whit worth . 119, 206. 322, 

334, 402, 432, 520, 526*, 527, 599, 838 

Trinder v. Trinder . . . 541 

Tring, Reading and Basingstoke 

Railway Co., re . . . . 656 

Barber (1 Mac. >fc G. 176; 

Cox (3 De G. & Sm. ISO) 

Trinity House of Hull v. Beadle . 310 

Tripp v. Chard Railway Co. . 271 

Troup's case ..... 383* 

Troutbeck, ex parte . . 642, 646* 

Trower and Lawson's case . . 691 

Trueman's Estate . . . 704 

Tufnell's case .... 124, 763 

Tumacacori Mining Co. . 626, 62S, 632, 

640, 645*, 651 



Tunis Railway Co. . . . 711, 883 
Tunnel Mining Co. 

Pool (35 Ch. D. 579) 
Turner, ex parte (3 De G. & J. 46) 488 

(3 De G. & S. 127) . . . 660 

& James, ex parte (3 De G. 

& S. 127, and 2 Mac. & G. 169) 622, 
623, 646*, 660 

v. Borlase .... 593 

v. Hill 593 

■ v. Metropolitan Live Stock 

Co 45 

r. Tyacke . . . . 593 

Turney v. Bayiey . . . 440 
Turnley & Oliver, ex parte . . 698 
Turquand v. Kirby . . 707, 813 

v. Marshall . 311, 371, 373, 374, 

376, 377, 378, 389, 433, 441, 707 
Twycross v. Grant . 70, 90, 92, 496 

Ulster Land Co., Limited . 693 

Ulverstone Railway Co. v. Com- 
missioners of Inland Revenue . 469 
Underbill v. Devereux . . 281 

Underwood's case . 664, 710, 846, 849, 

852, 868 
Union Bank of Calcutta 

Watson (3 De G. & Sm. 253) 
Union Bank of Kingston-upon- 

Hull . 208, 881, 883, 896, 972 
Union Bank of Manchester 

Jackson (12 Eq. 354) 
Union Bank of Scotland v. Na- 
tional Bank of Scotland . . 459 
Union Cement and Brick Co. 

Pulbrook (4 Ch. 627) 
Union Rubber Co. v. Hibbard . 910 
United Kingdom, &c. Building 

Association . . - 704 

United Kingdom Mutual Steam 

Assurance Assoc, v. Xevill 46, 428 
United Kingdom Shipowning Co. 

Felgate (2 De G. J. & S. 456) 
United Ports and General Insur- 
ance Co 660 

Adams (13 Eq. 474) 

Beck (9 Ch. 392) 

Even (16 Eq. 354) 

Perrett (15 Eq. 250) 

Wynne (8 Ch. 1002) 

v. Hill .... 264 

United Service Co 665 

Hall 15 Ch. 707) 

Johnston (6 Ch. 212) 
United Stock Exchange, Limited 659 

Philp & Kidd (28 Ch. D. 183) 
Unity General Bread and Flour Co. 

Hirtzel (2 De G. F. & J. 653) 
Unity Joint-Stock Banking Assoc. 

King (3 De G. & J. 63) 
Universal Bank, re . . . 662 

Universal Banking Corporation 

Gunn (3 Ch. 40) 

Harrison (3 Ch. 633) 

Rogers (3 Ch. 633) 

Stracy (5 Ch. 492) 


Universal Disinfector Co. . 678 

Universal Life Assurance Co. . 741 
Universal Non-tariff Fire Insur- 
ance Co. 

Ritso (4 Ch. D. 774) 
Universal Provident Life Assoc. 

Bell (22 Beav. 35) 

Daniell (22 Beav. 43) 

(2) (23 Beav. 568) 

Holt (22 Beav. 48) 

Munt (22 Beav. 55) 
Universal Salvage Co. 

Mansfield (2 M. & G. 57) 

(3 De G. & Sm. 58) 

Murray (5 De G. M. & G. 746) 

Sharpus (3 De G. & Sm. 49) 

Smallbone (14 Jur. 103) 

Woodfall (3 De G. & Sm. 63) 
Universal Tontine Life insur. Co. 

Dee (3 De G. & Sm. 112) 
Upfill's case (Hutton v. Upfill, 2 

H. L. C. 674) . 764*, 765*, 767 

(1 Sim. N. S. 395) . 851, 861 

Upton v. Brown .... 545 
Uruguay Central & Hygueritas 

Railway Co. of Monte Video . 625*. 
636, 648* 

Vale of Neath and South Wales 
Brewery Co. 

Gordon (3 De G. & Sm. 249) 
Hitchcock (3 De G. & Sm. 92) 
Hollwey (1 De G. & Sm. 777) 
Keene's Executors (3 De G. M. & G 

Kluht (3 De G. & Sm. 210) 
Morgan (1 De G. & Sm. 750 

and 1 M. & G. 225) 
Richmond's Executors (3 De G. & 

Sm. 96) 
Walters (3 De G. & Sm. 149) 

No. '2 (3 De G. & Sm. 244) 

White (3 De G. & Sm. 157) 
Vale of Neath, &c. Joint-Stock Co. 

Lawes (1 De G. M. & G. 421) 
Vallee v. Dumergue . . . 914 

Valpy& Chaplin, ex parte . .203 
Vance v. The East Lancashire 

Railway Co. . . 321, 323, 598 
Van Diemen's Land Co. v. Cock- 

Vane v. Cobbold 
Van Sandau v. Moore 

. . 33, 34 
266, 561, 564*, 

Varney v. Hickman . . . 
Venables v. Schweitzer 
Venezuela (Directors of Central 

Railway Co. of) v. Kisch 
Vertue v. East Anglian Railway 


Vice v. Anson 21, 65*, 96*, 205, 
Victoria Permanent Benefit Build- 
ing, &c. Society 

Empson (9 Eq. 597) 
Hill (9 Eq. 605) 
Jones (9 Eq. 605) 







Vigors v. Pike 

. 281,572 

Vining's case 

842, 897 

Vivyan v. Mowatt . 

96, 97 

Yolhuis v. Fletcher . 

. 14, 16 

A 7 ion Colliery Co., 20 Ch. D. 442 677 

\Y\i.\ Wynaad Indian Gold Min- 
ing Co 626, 1029 

Walburn v. Ingilby 2, 133*, 134, 569 
Walker's case (6 Eq. 30) . . 823 

(2 Eq. 554) . . 836, 837, 861 

(8 De G. M. & G. 607) 244, 839, 


(2 Jur. N. S. 1216) . . 520 

Walker, ex parte (1 De G. & Sm. 
585, 1 H. & T. 100, and 
13 Jur. 157) . . 640 

(15 Jur. 853) .... 

Walker v. Banaghcr Distillery Co. 


v. Bartlett . 96, 453, 468, 472, 
493, 506, 510 
v. General Mutual Building 
Society. . . . 920, 921 
v. Great Western Railway 


v. London Tramways Co. 119, 

31, 34*, 128 


v. Milne 

Wall's case (15 Eq. 18) 
Wallis's case 
Walsh's case . 
Walstab, c.r parte 

». Spottiswoode 

Walter's case (3 De G. & Sm. 244) 

518, 839 

(3 De G. & Sm. 149, and 19 

L. J. Ch. 501) . . 791, 796*, 824 
Walter, ex parte (3 De G. & S. 2). 628 
Walton's estate (23 Beav. 480) . 540 
Walton, ex parte (17 Ch. D. 746). 553 

(3 Jur. N. S. 853) . . . 861 

Walton v. Edge . 524, 861, 872, 920 
Walton and Hue. . . .831 
Walworth v. Holt . . . 565, 594 
Warburton v. Hill . . .461 
Ward's case (10 Eq. 659). . 14, 769 

(4Eq. 189). . . .121 

(2 Ch. 431) . . . . 121 

(2 Eq. 226) . . 833, 834 

Ward and Garrit's case 
Ward and Henry's cases 


834, 835 

470, 500, 833, 


Ward, ex parte (L. R. 3 Ex. ISO) 44, 

121, 123 

(20 Ch. D. 356) . 

Ward v. Combe . . . . 

v. Londesborough 

v. Sittingbourne and Sheer- 

ness Railway Co. . 
v. Society of Attornies 98, 







v. South - Eastern Railway 

Co. 54, 60, 61, 63, 108, 471 
Ware v. Camberledge . . . 452 



Ware v. Grand Junction Water- 
works . . 324, 601 

o. Regent's Canal Co. . . 264 

Waring, ex parte (W. N. 1866, 

390) .... 717 

(19 Vesey, 345) . . . 727* 

Warkworth Dock Co. 

Phillips (18 Beav. 629) 
Warrant Finance Co.'s case (5 Ch. 

(4 Ch. 643) . 

(No. 2), (10 Eq. 11) 

Warren's Blacking Co. 

Pentelow (4 Ch. 178). 
Warwick and Worcester Railway 
Co. (13 Jur. 651). . . 

(27 L. J. Ch. 735) 

Parbury (3 De G. F. & J. 80) 
Pell (3 De G. & Sm. 170) 
Prichard (5 De G. M. & G. 495) 
Washoe Mining Co. v. Ferguson 
Waterford, Duugarvan and Lid 
more Railway Co. (5 L. R. Ir 
103, 584) 
Waterford, &c, Railway Co. (Ir, 
Rep. 4 Eq. 538) 

v. Dalbiac . 

v. Logan 

v. Pidcock 45, 46, 50, 59, 60 

. 725 
725, 726 






107, 108, 420, 421 

Waterhouse v. Jamieson. . 395, 

Waterloo Life Assurance Co. (31 

Beav. 586) . 127, 624, 

(4N. R. 207). . . . 

Carr (33 Beav. 542) 

Paul & Beresford (33 Beav. 204) 

Saunders (2 De G. J. & S. 101) 

Waterlow v. Sharp . . . . 

Waters v. Taylor. . . 575, 

Watkin, ex parte . . . . 

Watkins v. Clark 

v. Huntley . . . . 

AVatson, ex parte (re Calcutta 

Bank, 3 De G. & S. 253) 561, 
622, 639*. 651 




(21 Q. B. D. 301) 

163, 177, 189, 
190, 191, 919 
. 569, 570 
35*, 145 

Watson v. Black . 

r. Cave . 

v. Charlemont . 

v. Eales 417, 418, 424*, 532, 534*, 


v. Mid Wales Railway Co. . 

v. Spratley . . . 449, 

Watson, Kipling & Co. . . . 
Watts v. Jerfryes 

v. Porter . . . . 

v. Salter . . . 33*, 

Weald of Kent Canal Co. v. Robin- 
son 426, 

Wear Engine Works Co. . . . 
Wearmouth Crown Glass Co. 
Webb's case . . ... 
Webb v. Commissioners of Heme 
Bay. . . 163, 171 

v. Earle. 

v. Taylor . 







400, 435 




Webb v. Whiffin . 394, 754, 821, 851, 

856, 857 
Webster's case (2 Eq. 741) 21, 25, 26*, 

122, 772 

(32 L. J. Ch. 135) . . . 843 

Wedgwood Coal and Iron Co. . 711, 881 

Anderson (7 Ch. D. 75). 
Weekley v. Weekley . . 452, 453 
Weeks v. Propert . . 89, 242 

Weikersheim's case 59, 758, 806, 807 
Weir v. Barnett .... 244 

v. Bell . ... 88, 89* 

W T eiss, re . . . 263, 295, 671 
Welland Railway Co. v. Berrie 417, 

909, 910 

v. Blake. . . 414, 427, 537 

Wellington Reversionary Annuity 
and Life Assurance Soc. 
Conquest (1 Ch. D. 334). 
Wells v. Mayor of Hull . . . 223 

v. Williams. ... 37 

Welsh Flannel and Tweed Co. 847, 879 
Welsh Potosi Mining Co. . . 613 
Birch (2 De G. & J. 10). 
Clarke (2 De G. & J. 245). 
Lofthouse (2 De G. & J. 69). 
Tobin (7 W. R. 4). 
Wenlock (Baroness) v. River Dee 

Co. 112, 162, 163, 164, 165, 176, 187, 
189*, 191 
Wentworth v. Chevell. . 537, 544 
Werle & Co. v. Colquhoun . . 911 
West's case) . , . 191, 192 
Westbourne Grove Drapery Co. (5 

Ch. D. 248) . . 720, 732 

(W. N. 1878, 195) . . 885 

Westcomb's case . . . 863 

West Cork Railway Co. . . 905 
West Cornwall Railway Co. v. 

Mowatt . . . 105, 192, 396 
West Cumberland Iron and Steel 

Co 665 1029 

West Devon Great Consols Mine 

(27 Ch. D. 106) 325, 658, 705 

(38 Ch. D. 51 ) 

W T est of England Bank . 

Booker (14 Ch. D. 317) 

Brown (12 Ch. D. 823) 

Budden and Roberts (12 Ch. 
D. 288) 

Hatcher (12 Ch. D. 284) 
West of England and South Wales 
District Bank. 

Swansea Friendly Society (11 
Ch. D. 768) 

Dale & Co. (11 Ch. D. 772) 
West Ham Distillery Co. 

Whittel (2 De G. & J. 577) 
West Hartlepool Iron Works Co. 
(10 Ch. 618) . . . 

(10 Ch. 629) 

(34 L. T., N. S. 570) . .■ 

Gray (1 Ch. D. 664) 
West India Steamship Co. . 
West Jewell Tin Mining Co. 

Weston (10 Ch. D. 579). 
West London Commercial Bank . 






West London Commercial Bank 

v. Kitson .... 231, 242 
West London Railway Co. v. Ber- 
nard ..... 313 
West Riding Union Banking Co. 

Turner (19 Ch. D. 105) 
West Silver Bank Mining Co. . 986 
West Surrey Tanning Co. 640, 645* 

West v. West . . . 108, 467 

Western Bank of Scotland v. Addie 72, 


v. Bairds .... 373* 

Western Benefit Building Society 657 
Western of Canada Oil, &c. , Co. 

(17 Eq. 1) 630, 635, 636, 637, 652 

(6 Ch. D. 109) . . .691 

Carling <20 Eq. 580 and 1 Ch. 

D. 115) 
Hespeler (1 Ch. D. 115) 
Walsh (1 Ch. D. 115) 
- v. Walker ". . . 263 

Western Life Assurance Society 

(11 Eq. 164) . . . . 735 

(5 Ch. 396) . . 702, 704 

Willett (5 Ch. 396) 
Western Suburban Building Society 

v. Martin .... 921 

Westman v. Aktiebolaget, &c. 

Fabrik 909 

Westminster Silver Lead Ore Co. 

(Duchess of) . . . 749, 786 
Weston's case (10 Ch. D. 579) . 367, 

696, 699 

(4 Ch. 20, and 6 Eq. 238) . 464, 

465, 665, 821, 825, 827, 834, 
835, 878, 889 

(5 Ch. 614) 800, 803, 811, 828 

Westropp v. Solomon . . 494, 515* 

Wexford and Valencia Railway Co. 

Fisher (3 De G. & Sm. 116) 
Wey and Arun Junction Canal Co. 

618, 647* 
Whaley Bridge Co. v. Green 347, 349, 
356*, 361* 
Wheal Anne Mining Co. (10 W. 

R. 330) 619 

(30 Beav. 601) . . 653* 

Wheal Buller Consols 148, 301, 792, 
793, 795* 
Wheal Lovell Mining Co. 
Wyld (1 M. & G. 1) 
Wheal Unity Wood Mining Co. 
Chynoweth (15 Ch. D. 13) 
Wheal Virtue Mining Co. . . 686 
Wheal Vyvyan Mining Co. 
Wescomb (9 Ch. 553) 
Wheatley v. Silkstone Coal Co. . 197 
Wheeler v. Van Wart . . 609* 

Whinney, ex parte (13 Q. B. D. 

476) 848 

White's case (3 De G. & Sm. 157) 42, 


(12 Ch. D. 511) . . .785 

(3 Eq. 84) . . . 833, 834 

White v. Carmarthen Railway Co. 198, 

Whitehead v. Izod ... 832 




Whitehead v. Whitehead . . - r 'i7 
Whitehouse's case (3 Eq. 790) . 28 
Whin-house & Co., re (9 Ch. D. 

595) .... 742, 744 
Whitfield v. South- Eastern Rail- 

way Co. 
Whitley Partners, Limited 

. 209 
19, 119, 
797, 935 



Whittet's case ... 60, 
Whitworth'a case . . . 690, 
Wigan v. Fowler 
Wightwiek r. Lord . . . 

Wilby v. West Cornwall Railway 


Wilde v. Stannar . . . . 
Wilkins v. Roebuck . 
Wilkinson's case . 26, 28, 771, 773 
Wilkinson v. Anglo-Cahfornian 

Gold Co. . . . 45, 59, 64 

v. Lloyd . . 467, 491, 493 

Willes v. Greenhill . . . 205 

Willey v. Parratt ... 33 

Williams' case (1 Ch. D. 576) . 802, 

803, 805, 827, 828 

(2 J. & H. 400) . . . 735 

(9 Eq. 225) . . .828 

Williams, ex parte (2 Eq. 216) 357, 722 

(1 Sim. K S. 
v. Archer . 
v. Aspinall 
v. Beaumont 
V. Colonial Bank 





. . 286 

. 267 

474, 475, 481*, 


550, 556, 708, 848 










Salmond . 565, 567, 568 

Swansea Harbour Trustees 88 

v. Harding 

v. Hathaway 

— — v. Hayward . 

v. Hopkins 

v. Jones . 

v. Pigott 

— v. Prince of Wales 

Life Co 

v. St. George's Harbour Co. 

v. Trye 

Williamson, ex parte 

v. Barbour . 

Willison v, Patteson 

Willmott v. London Celluloid Co 

189, 235, 236, 
238*, 385, 919 



58, 307, 308, 415, 
426, 537 
267, 427, 565 

Wills v. Bridge . 
v. Murray 

v. Sutherland 

Wilmot v. Corporation of Coventry 220, 




. 694 

45) . . 696 

. 699 

. . 364 

, Railway 

425, 427 

Wilson's case (8 Eq. 240) 

(9 Eq. 706) . 

(12 Eq. 516) 

Wilson, ex parte (8 Ch. 
— (7 Ch. 45) . 

v. Bury (Lord) 

v. Birkenhead, &c 

Co. . 


30, 265, 570 


. 363, 606 

. 499, 802 

207 1 



. 139 
1 19, 176 


v. Caledonian Railway Co. 

Wilson v. Churcli . 

v. Craven . 

v. Curzon 

r. Keating . 
v. Miers 

v. Natal Investmenl Co 
— v. Stanhope 
r. Strugnell . 
r. Tumman . 
— v. Wallani 

v. W.-t Eartlepool Rail. Co. 160, 

223, 228 

v. Wilson . . . 302, 303 

Wiltshire Iron Co. 

Pearson (3 Ch. 443) 

v. Great Western Rail. Co. 668*, 

672, 754 
Winch v. Birkenhead Rail. Co. 202, 

207, 322, 572, 580, 598, 601, 892 
Wincham Shipbuilding Boiler and 
Salt Co. 

Hallmark (9 Ch. D. 329) 
Poole, Jackson & White 
Ch. I). 322 
Winehouse v. Winehou c e 
Wingfield v. Barton 

v. Peel .... 

Winne o. Bampton 
Winstone's case . 120, 737, 752, 757 
Winterbottom, exparte . 550,708 
Wise, exparte 561, 631, 632, 639, 

Withernsea Brickworks 676, 678, 719, 

Wittenbury v. Law 
Witts v. Steere 
Wolesey, exparte 
Wolverhampton, Chester and 
Birkenhead Junction Co. 
Cottle (2 M. & G. 185) 
Dale (1 De G. M. & G. 513) 
Holroyd (15 Jur. 696) 
Roberts (1 Dr. 204) 
Stocks (22 L. J. Ch. 218) 
Wolverhampton New Waterworks 

Co. v. Hawkesford 59, 60, 104, 105*, 

421, 427 

Womersley v. Merritt . . 135 

Wontner v. Shairp . 16,34,145 

Wood's case (15 Eq. 236) . . 124 

(3 De G. & J. 85) . . 778* 

Wood's claim (9 W. R. 366, and 

10 ib. 662) 180*, 237, 735 
Woodv. Argyll . . . 144, 145 

v. Marston . . . . 269 

■ v. Wood .... 534 

Woodfall's case . ... 780* 

Woodhams v. Anglo-Australian 

Co. . 180, 275, 283, 560, 563, 741 
Woollaston's case 83*, 533, 822, 843, 

Woolman v. Toby . 32, 270, 607 

Woolmer, exparte 623, 646*, 664, 860, 

865, 866 
Worcester Corn Ex. Co. (3 De G. 

M. & G. 180) 235 248, 384, 851, 862 
(15 Jur. 960) . . .684 


720, 721 

293, 294 

293, 294 

. 220 

622, 656 



. 247 

353, 709 

704, 889 

521, 777 

. 818 






Worcester, Tenbury arid Ludlow 

Rail. Co 663* 

Wormwell v. Hailstone . 278, 279 

Worth's case (5 Ch. 682) 53, 122, 184 
Worth, ex parte, (4 Drew. 529) 83, 84, 

Worthington v. Sudlow 
Wreck Recovery Salvage Co. 
Wright's case (5 Ch. 437) 

(7 Ch. 55) . 

(12 Eq. 331) . 

(12 Eq. 336, note) 

Wright v. Campbell 

v. Desley . 

— v. Horton . . 17 . 
V. Monarch Investment Build- 
ing Society . • 916 

t>. Snowe .... 

v. Tuckett .... 

v. Warren . 

Wright & Gamble, ex parte (8 Eq. 


Wrighte's case (2 De G. M. & G. 

636) . . . 722, 723, 850, 860 
Wrighte v. Lindsay . . .848 
Wrysgan Co. 

Humby (5 Jur. N. S. 215) 
Wyall v. The Darenth Rail. Co. 
Wyatt v. Metropolitan Board of 

Works . . • • 146 
Wye Valley Rail. Co. v. Hawes 









Wvlam's Steam Fuel Co. v. Street 

Wyld, ex parte 561, 619, 631, 639, 

J 649* 

v. Hopkins . . 128, 144* 


Wyley v. Exhall Coal Co. . .674 
Wynn Hall Coal Co. 

North and South Wales Bank 
(10 Eq. 515) 
Wynne's case 17, 26, 769, 773, 774 

Wynne v. Price . 473, 499, 505, 510 

Yarborough v. Bank of England 

Yelland's case (5De G. & Sm. 395, 
and 16 Jur. 509) 47, 757, 

(4 Eq. 350) .... 

Yetts v. Norfolk Railway Co. 411, 

York Buildings Co. , The 
York and London Assurance Co. 

Hodsell (19 L. J. Ch. 234) 
York and North Midland Railway 

v. Hudson 321, 364*, 365*, 2 

York Tramways Co. v. Willows 

158, 302, 337, 409 

Yorkshire Fibre Co. . . 440 

Yorkshire Railway] Wagon Co. r. 
Maclure ..... 

Young v. Brompton Waterworks 

v. Cole . • • 

v. Smith .... 

Young & Co. v. Mayor of Leam- 
ington Spa . . . • • 

Ystalifera Gas Co. 









Zulueta's claim 

171, 206, 723 

lxix ) 




33 Hen. 8, c. 27 . . . . 315 

7 Wm. 4 & 1 Vict. c. 71 

21 Jac. l,c. 16 . . . . 723 


j 20 


100, 437 

29 Car. 2, c. 3, § 4 and § 17 . 228, 453 


. ioo 

, 101, 

256, 290 

6 Geo. 1, c. 18, § 18 . . 130, 320 



6 Geo. 1, c. 91 . . . . 130 



7 Geo. 2, c. 8 . . . .488 



255, 257, 

21 & 22 Geo. 3, c. 46 (Irish) . . 5, 8 


39 & 40 Geo. 3, c. 28, § 15 . . 136 


. 270 

4 Geo. 4, c. 76, § 16 . . . 172 



5 Geo. 4, c. 114 ... 3 



6 Geo. 4, c. 42, § 10 . . . 137 


97, 252 

6 Geo. 4, c. 91, § 2 . . 3, 99, 252 


99, 100 

7 Geo. 4, c. 46 . . . . 4, 93 

1 & 2 Vict. 

c. 96 


See, in Index, Com- 

§4 . 

. 458 

panies governed by 

1 & 2 Vict. 

c. 106 

, §§ 29, 

31 . 


7 Geo. 4, c. 46 

1 & 2 Vict. 

c. 110 

460, 463, 848 

§ 4 . 109, 269, 282, 285, 

§ H 

. 6 

, 9, 461 




5 . 109, 110 



6 . . . . 109 



11 ... 252 



12 . . . . 252 

3 & 4 Vict. 

c, 11 


13 252, 257, 285, 286 

3 & 4 Vict. 

c. 82, 



14 . . . 379, 380 

4 Vict. c. 14 


9 Geo. 4, c. 14, § 6 . 207, 217, 285 

4 & 5 Vict. 

c. 45, 

§17' . 


1 AVm. 4, c. 66 . . . . 66 

5 Vict. c. 5 

§4 . 

. 6, 4 

60, 463 

3 & 4 Wm. 4, c. 42, § 28 and 

7 & 8 Vict. 

c. 32, 

§§ 1, 8- 

-11, 23 

§29 . . 725 


! 136 

3 & 4 Wm. 4, c. 83, § 2 . . 136 

7 & 8 Vict. 

c. 85, 



3 & 4 Wm. 4, c. 98, § 2 . . 136 

7 & 8 Vict. 

c._ 110 

4 & 5 Wm. 4, c. 94 . 4, 99, 252 


in the Index 

, Com 

6 & 7 Wm. 4, c. 32 . . . 918 

panies governed 



7 Wm. 4 & 1 Vict. c. 73 

Vict. c. 


See, in the Index, Com- 


43, 44 

panies governed by 7 



Wm. 4 & 1 Vict. c. 73 



§1 . . . .266 


. 1 

48, 253 

2 . . . . 101 



87, 488 

3 . . 101, 270 


. 3 

28, 382 

4 101, 252 



00, 336 

5 . . . .100 



6 43, 93, 100, 282, 290 



7 . . . . 100 



8 . . . 100, 101 



9 . . . 100, 101 



10 . 43, 93, 100 



13 100, 270 



17 . . . .100 

7 & 8 Vict. c. 11 

5, 611, 

612, 6 

17, 620 

18 . . . . 100 




7 & 8 Vict. c. 113 . . 

See, in the index, Com- 
panies governed by 7 & 8 
Vict. c. nr 

§1 • 

7 . 

14 . 

23 . 

37 . 
8 & 9 Vict. c. 16 

See, in the Index, Com 

panies governed by 8 & 9 

Vict. c. 16 

§3 . 


7 . 


109, 138 




104, 538 
. . 103 
104, 293, 438 
103, 282, 333 
103, 282, 333 
. . 103 
. . 103 
108, 467, 538 

16 and Sched. B. 108, 458, 


468, 488, 538 


438, 478, 538 

399, 420, 426 

399, 418, 420 

. 414 

. . 400 

399, 414 

. 425, 427 

425, 427 

. 103, 427 

99, 408, 425, 529 

. . 529 

333, 529 

. 333, 529 


. . 529 


106, 252, 257, 282, 291, 

292, 294, 901 

. . 380 

188, 194, 203, 

332, 399 

. 194, 333 


. . 194 

194, 438 

50 . • . . 194 

51 . . • -194 

53 . • . . 195 

54 . . • -195 
56-58 . . . . 399 
61 . • • .399 
62-65 . . . . 400 
63 . . • .333 

65 . • . . 146 

66 . . • .330 

67 ... 331 



38 et seq. 



& 9 Vict. c. 16 
74 . 

76 . 

78 . 

80 . 
83 . 

85 . 

86 . 










100 . 

104 . 
109 . 
111 . 

113 . 


116 . 


118 . 


120 . 


122 . 


124 . 



138 . 


Sched. B 
9 & 10 Vict, c 28 

10 Vict. c. 75 . 

11 & 12 A r ict. c. 45 

3 . 
10 . 
16 . 


. 330 
. 331 
331, 601 


309, 328 

329, 332, 408 
329, 332, 438 
. 329 
. 329 
. 329 
226, 329 

226, 228, 329 
. 330 
. 330 
. 332 

' 332 
• 330 
. 330 


332, 441 


. 333, 441 

. . 434, 438 

414, 432, 438 


. . 438 








. 5, 901 
. 114 
. 5, 611 
. 619 
745, 750 

. 656 

. 681 



11 k 12 Vict. c. 45 



§29 ... 


24 & 25 Vict. c. 96 . 

. . 88 

30 . 

. 705 

§75 . 

. 446 




. . 9 

50 . 

263, 705 

84-87 . 


. 705 

82 . 

. . 446 

61 . . . 

. 858 

83 . 

. 446 


. 693 

84 . 

. . 446 

67 . . . 

. 693 

85 . 



. 832 

24 k 25 Vict. c. 98, § 23 

. . 66 

127 . 


24 & 25 Vict. c. 134, § 150 et se(/. 555 

Form 2 in schedule 

. 684 

25 k 26 Vict. c. 87 .6 

263, 293, 619 

12 k 13 Vict. c. 108 

. 5, 611 

§17 . 

. . 614 

§1 . . 

S19, 670 

25 k 26 Vict. c. 89 . 

. 933 

16 . . . 


The Companies 

act, 1862. 


. 746 

See the act in the Appendix, 



and see the Index, No. 1, 

40 . . . 

. 623 

and also " Comj 

lanies go- 

13 k 14 Vict. c. 43 . . 

. 616 

verned by the act of 1862 ' ' 

13 k 14 Vict. c. 60 

in the General Index. 

§2 . 

. 457 

26 k 27 Vict. c. 87, § 14 

. 721 



26 k 27 Vict. c. 92 

13 & 14 Vict. c. 83 . 

. 6, 618 

§37 . 

. . 891 

§§ 1, 2-29 . 


43 . 

. 264 

§§ 31, 35, 36 


26 & 27 Vict. c. 118 7, 

103, 196, 198, 

16 & 17 Vict. c. 70 


§§ 2, 116, 120, 12£ 


§4 . 

. . 530 




. 530 

141 ... 



. . 525 

142 . 

. 467 

10 . 

525, 530 

17 & 18 Vict. c. 25 . . 268, 293 


. . 530 

17 & 18 Vict. c. 82 . 


14 . 


17 & 18 Vict. c. 104, § 18 



. 396, 399 

17 & 18 Vict. c. 125, § 68 . 280, 603 

22 . 

188, 203 

18 & 19 Vict. c. 32 

23-35 . 

. . 188 

§4 . . . 

. 114 

28 . 

. 333 

22 . . . 

. 325 

Part III. . 

. . 198 

18 & 19 Vict. c. 133 

. 5, 127 

27 & 28 Vict. c. 19 . 

199, 229 

19 & 20 Vict, c 47 .6, 128, 255, 797 

27 k 28 Vict. c. 32 

. 266, 268 

See, in the Index, Com 


27 & 28 Vict. c. 121, § 3 et 

seq. 146, 400 

panies governed by the 

28 k 29 Vict. c. 78 

. . 204 

acts of 1856-8 

§3 . 

334, 343 

§19 ... 

45, 129 

6-11 . 

. . 339 

20 . 


21 . 

. 339 


. 755 


. . 339 

41 225, 228 

27 . 

. 339 

62 ... 

. 257 

31-33 . 

. . 339 

Table B. . 

45, 129 

29 & 30. Vict. c. 108 . 

188, 195, 196, 

20 k 21 Vict. c. 14 



§3 . . . 

. 135 

30 Vict. c. 23 

. . 761 

26-27 . 


30 Vict. c. 29 . 468, 491, 

501, 505, 511 

20 & 21 Vict. c. 49 

§ 1 

. 489, 784 

§ 4 . . . 114, 138 

30 & 31 Vict. c. 38 


5 . . 114, 135, 138 

30 k 31 Vict. c. 68 

. . 712 

12 . 


30 & 31 Vict. c. 47 and 131 . 6. 666 

20 & 21 Vict. c. 78 611, 612, 710, 

30 & 31 Vict. c. 127 

196, 901, 904 


§3 . 


§1 . . . 



. 195, 278 

7 . . . 


6 . 

. 905 

12 . . . t 

19, 670 


. . 905 

13 . 



905, 906 

21 k 22 Vict. c. 60, § 17 



. . 905 

21 & 22 Vict. c. 78 . 



906, 907 

22 & 23 Vict. c. 59 . 



. . 907 

23 & 24 Vict. c. 28 . 


27 . 

396, 399, 400 

23 k 24 Vict. c. 38, § 10 



. . 441 

23 & 24 Vict. c. 125, § 20 . 


31 . 

618, 902, 903 

23 k 24 Vict. c. 126, § 33 



. 902, 903 




30 & 31 Vict. c. 131 

The Companies act, 1867- 
See the act in the Ap- 
pendix, and the Index 
No. 1 

31 & 32 Vict. c. 68 . . . 882 

32 & 33 Vict. c. 19 97, 615, 619, 654, 

§3 . . . .325 

4 . . . . 326 

5 . . . 326, 419 

6 . . . . 326 

7 . . . .325 

8 . . 326, 419, 687 

9 . .94, 95, 325, 446 

10 326, 408, 417, 419, 446 

11 . • .412 

12 396, 414 

13 95, 265, 419, 425, 426, 

427, 559, 565 

14 . . 96, 326, 466 

15 96, 326 

16 . . . 326, 529 
16-23 . . .94, 326 
21-23 . . .524 

24 278, 326 

25 . . . 95, 819 

32 . . . . 699 

33 . . • .701 

35 . 96, 326, 465, 825 

36 . . • .278 
32 & 33 Vict. c. 46 . . 426, 537 
32 & 33 Vict. c. 48 . 7, 103, 198, 400 

§ 1 . . . 188, 203 

5 . . . 396, 399 

6 . . . 396, 399 

7 . . . 396, 399 
32 k 33 Vict. c. 62 

§ 4 . . • 462, 696 

23 . . • .556 

24 . • . . 556 
31 . • • .556 

32 & 33 Vict. c. 71, § 87 - 678 

32 & 33 Vict. c. 96, § 14 . . 458 

32 & 33 Vict. c. 114 . . . 901 

§ 4 . . 618, 630, 903 

§§ 8-10 . . • 902, 903 

33 Vict. c. 14 . . • • 36 
33 & 34 Vict. c. 20 . . 204, 334 

§ 3 et seq. . . 339, 343 
33 & 34 Vict. c. 23 

§§ 6-10, 12, 21, 30 . 38 
33 & 34 A r ict. c. 35 . 546, 547, 681 

s f\ 9 

33 & 34 Vict. c. 61 . 184, 441, 

445, 700 

§2 . . • -625 

14 . . 250, 261, 898 

15 . . . .898 

21 . . 621, 625, 631, 

634, 661 

22 . 621, 634, 635, 717 
33 & 34 Vict. c. 97 . . .469 

§ 3 . 14, 66, 97, 310 

69 . . . .469 

102, pi. 1 • • • 310 

pi. 3 . . . 310 

33 & 34 Vict. c. 97 

§112 . . • • 920 

Sch. Title Conveyance 310 

33 & 34 Vict. c. 104 . . 6, 1027 

34 Vict. c. 4 
34 & 35 Vict. c. 31 

34 & 35 Vict. c. 58 

35 & 36 Vict. c. 41 

§4 . 
7 . 

1st Sch. 

2nd . 

36 & 37 Vict. c. 66 




115, 917 

184, 445 

. 184, 445 

625, 643, 665, 702 

. 634, 733 

. 260 

. . 733 

. 734 


Act, 1873] 




596, 602, 603, 740 

§ IS (3) 
24, cl. 
25 (8) 
26, cl. 6 
34 . 
37 & 38 Vict. c. 35 . 
37 & 38 Vict. c. 41 

§7 . • • • 
37 & 38 Vict. c. 42 

Building Societies act, 
1874. See Appendix 
918 et seq., and also 




614, 615 

614, 615, 619, 627, 

638, 887 

43 . . • 189, 196 

37 & 38 Vict. c. 50 . . . 42 

37 & 38 Vict. c. 62 . . . 39 

37 & 38 Vict. c. 96 . . . 136 

38 Vict. c. 9 . . . .918 
38 Vict. c. 39 . . ■ ■ 189 
38 & 39 Vict. c. 31 - . . 278 
3S & 39 Vict. c. 55 

§§ 173, 174 . . . 223 

211 .. . 681 

38 & 39 Vict. c. 60, § 10 . 201, 918 

38 & 39 Vict. c. 66 . . 7, 103, 188 

38 & 39 Vict. c. 77 [Judicature 

act, 1875] 
§ 10 . 678, 681, 685, 716, 
719, 725, 726, 738, 739, 742, 858 

39 Vict. c. 6, § 2 . . .761 
39 Vict. c. 29 . . . • 515 

39 & 40 Vict. c. 45 

Appendix pp. 915* — 917. 
See also as to 
§4 . 
§11 ■ 
§17 . 

40 & 41 Vict. c. 26 

(Companies act, 
See the Appendix 
40 & 41 Vict. c. 63 . 
42 & 43 Vict. c. 76 

42 & 43 Vict. c. 76 

(Companies act, 1879) 
See the Appendix 

43 Vict. c. 14, § 8 

. 293, 614 

. 221 

. . 266 


614, 615, 619 


. . 1028 

918, 918, 920 





43 Vict. c. 19 

(Companies act, 1880) 
See Appendix 
41 k 45 Vict. c. 59 
§4 . 

44 k 45 Vict. c. 59, § 4 and r. 74 

45 & 46 Vict, c 43 

45 k 46 Vict. c. 61 


. 198, 203 

185, 186, 230, 267, 

559, 740 

45 k 46 Vict. c. 75 

§§ 1 and 6 to 9, 41, 42, 428, 

436, 437, 549, 809 

§§ 13, 14. . 42, 808, 809 

46 & 47 Vict. c. 28 

(Companies act, 1883) 
See Appendix . 
46 k 47 Vict. c. 30 
Register act) 
See Appendix 
46 & 47 Vict. c. 39 
46 k 47 Vict. c. 47. 
46 & 47 Vict. c. 49 
46 k 47 Vict. c. 52 
§§ 23 k 24 




. . 1035 

. 903 

. . 915 

279, 2S0, 603 


. 550 

. . 556 


426, 554, 556, 557, 

558, 815, 816 

. 721 

. 550, 557 

454, 550, 551, 557 

. 461, 678 

. . 678 

. 668 

. 552, 557 

550, 557 

426, 553, 554, 556, 

557, 558, 815, 816 

46 & 47 Vict. c. 52 
123 . 
164 . 
c. 43 
c. 56 


97, 441, 

47 & 48 Vict. 
47 & 48 Vict. 
47 k 48 Vict 

49 Vict. c. 23 

(Companies act, 1886) 
See Appendix 

50 k 51 Vict. c. 43 

§ 2 

3 . 


6 . 

13 . 

19 . 

22 . 326, 524, 

23 & 24 94, 325, 
25 & 26 325, 
27 . . 323, 

32 . 

51 Vict. c. 8 

§11 • 

12, 13, 14 
17 . 

51 & 52 Vict. c. 42, §§ 4 & 10 

51 & 52 Vict. c. 48. 

51 & 52 Vict. c. 51 

51 k 52 Vict. c. 59, § 8 . 

51 & 52 Vict. c. 62 . 681, 

. 616 


264, 550 

. 668 
550, 720 
918, 921 
103, 915 

. 4, 97 

. 1037 
654, 689 

. 325 
325, 615 
278, 718 
293, 294 

325, 709 
. 718 


326, 525 
816, 840 
446, 448 

326, 446 

327, 899 
615, 619 

. 325 

117, 401 
. 469 
. 469 

469, 490 

. 451 


. 282 

. 374 

717, 718 


Order IX. r. 8 . 

Order XI. 

Order XVI. 
r. 9 
r. 11 
r. 14 . 
r. 15 
r. 48 . 

Order XXII. r. 17 

Order XXXI. 

rr. 1 & 5 
r. 12 

Order XL1I. 

r. 10 . 
r. 23 


. 264 

. 268 
. 569 
268, 271 
. 483 
. 450 

265, 594 
. 595 


281, 282, 286, 289, 291, 
292, 293 

Order XLII. 

r. 31 

r. 32 et seq. 
Order XLV. . 

r. 1 
Order XLVI. . 

r. 1 
Order XLIX. r. 5 . 
Order LI. r. 2a . 
Order LIII. rr. 1—4 
Order LVIII. 

r. 4 

rr. 9 & 15 
Order LXI . 
Order LXV. r. 6 . 





. 697 

460, 464 

461, 84S 
. 675 
. 675 

280, 603 

662, 698 
. 864 
264, 661 


( lxxiv ) 


The following abbreviations frequently occur in the present work :— 

R. S. C. = Rules of the Supreme Court, 1883, and subsequent rules. 

Bank. Rules = The Bankruptcy Rules, 1886, and subsequent rules. 

Buckley = The Law and Practice under the Companies Acts, 1862-1886, by 
H. Burton Buckley, Q.C. 5th edition. London, 1887. 

Part. - A Treatise on the Law of Partnership, by the authors of the present 

work. 5th edition. London, 1888. 

( lxxv ) 



72, 73, and\ 
88-90 . J 

113, note («). 
123, note (to). 

184, line 7. 
186, note (b). 
217, note {q). 

229, note (y). 


266, note («). 

267, note (g). 


431, note («). 
464, note (i). 

659, note (6). 


738, note (h). 

785, note (A). 

/V-/. v. Ar,-//, 37 Ch. D. 541, is under appeal in the House of 

Life assurance companies fall under one or other of the Class** 
2, 3, and 1, unless they are merely large partnerships, which 
is seldom, if ever, the rase. Thev are, however, governed by 
the Acts 33 & 34 Vict. c. 61, and" 35 & 36 Vict. c. 41, which 
will be found in Appendix VII., pp. 1095 and 1103. These 
statutes ought to have been noticed in the introductory obser- 
vations in Bk. I. c. 4. 

Add Outlay Assuranc: Society, 34 Ch. D. 479. 

Railway Times Tab < Publishing Co. overruled. W. N. 1889 

p. 77. 
Add Export* Smith, 39 Ch. D. 546. 

For insurance companies, read Life insurance companies. 

For Bk. III. c. 2, § i read c. 1, § 3, p. 323. 

British Mutual Banking Co. v. Chamu-ood Forest Rail. Co. 

observe that their 
company had no p 

stock certificates were for stock which the 
>wer to issue ; being for stock in excess of 

the amount which t be company had power to borrow. 

The Companies seals ict, 1864, will be found in the Appendix of 
Statutes, p. 1015. 

Add Ex parte PoppleAn, 14 Q. B. D. 379 

For Bk. III. c. 9, § 3 

As to the removal of 
Sea Fishing Co. v. 

Lee v. Neufchatel As t 

read Bk. III. c. 9, § 1. 

Add reference to Ban mrptcy Rules, 1886, r. 258, and cf. p. 549 
and 550. 

a managing director, see also Boston Deep 
Ansell, 39 Ch. D. 339. 

halte Co. is now reported 41 Ch. D. 1. 

Add but the Court w 11 not grant a prerogative writ of mandamus 
to compel registrs tion in such a case, see p. 603 and R. v. 
Lambourn Valley Vail. Co., 22 Q. B. D. 463. 

Criterion Col, I Mini/ g Co. is now reported 41 Ch. D. 146. 

Transfers of shares, see p. 471 and p. 832. 

For 37 & 38 Vict. c. 83, read 38 & 39 Vict. c. 77. 

See also Jones, Lloxd <i- Co., Limited, 41 Ch. D. 159, where an 
agreement to set-c ff against future calls a present liability of 
the company to p;y cash was held within the section. 


ict., yeo 

Page 902, note (i). For 14 k 15 Vict., bead 13 & 14 Vict. 

,. 911 The following cases on income-tax payable by companies may be 

useful for reference : — 
Last v. London Assurance Corporation, 10 App. Ca. 438 ; 

12 Q. B. D. 389 ; 14 Q. B. D. 239. 
Ryhope Colliery Co. v. Fryer, 7 Q. B. D. 485. 
R. v. Commissioners of Lncome-Tax, 20 Q. B. D. 549. 
Lawless v. Sullivan, 6 App. Ca. 373. 

.. 916, note (d). Add p. 921 before the reference to notes (c) and (d) in next 

,, 929. Add 1886, 49 Vict. (c. 23, the Companies act, 1886. 




1. Nature of a company. 

By a company is meant an association of many persons who Introductory. 
contribute money or money's worth to a common stock and 
employ it in some trade or business, and who share the profit 
or loss (as the case may be) arising therefrom. The common 
stock so contributed is denoted in money and is the capital of 
the company. The persons who contribute it or to whom it 
belongs are members. The proportion of capital to which 
each member is entitled is his share. Shares are always trans- 
ferable ; although the right to transfer them is often more or 
less restricted. 

A company which is neither incorporated nor privileged by Companies 

A J i . compared witu 

the Crown or the Legislature is substantially a partnership ; partnerships. 
and although the transferability of its shares considerably 
modifies the application to it of the ordinary law of partner- 
ship, still the company, like an ordinary firm, is not in a legal 
point of view distinguishable from the members composing 
it (a). 

A company which is incorporated, whether by charter, 
special act of Parliament, or registration, is in a legal point 
of view distinct from the persons composing it, and is therefore 
regarded by lawyers somewhat as a firm is by non-lawyers. It 
sues and is sued by a name of its own, and its continuous 
existence is not affected by changes amongst its members. 

(a) Part. 110 et seq. 
L.C. B 


Introductory. A company which without being incorporated is privileged 
to sue and be sued by the name of some public officer, is as it 
were half-way between an incorporated and an unincorporated 
company. So far as its privileges do not make a difference, 
the company is a partnership ; and so far as its privileges 
extend, it may without any great inaccuracy be likened to a 
corporation ; for the main object of these privileges is to 
confer upon the company a sort of continuous existence, 
whatever changes may take place amongst the individual 

Sketch of com- 
pany law. 

Progress of 


2. Historical sketch of the law relating to companies. 

By the common law of this country every association of 
persons formed for the sake of sharing profits, is either a 
partnership or a corporation ; and a company which is neither 
a corporation nor a partnership, is a thing unknown to the 
common law of England (b). It has even been said that a 
large partnership, the shares in which are transferable without 
the assent of all the members, is illegal at common law ; and 
although the better opinion is that this is not so (c), still the 
courts treat as illegal any association for profit which attempts 
to arrogate to itself the privileges of a body corporate (d). 
But within the last century associations unknown to the 
common law have struggled into existence, and after much 
opposition have become legal. These are commonly called 
companies, or more accurateky joint- stock companies. 

When unincorporated companies, with a joint-stock divided 
into numerous transferable shares, began to assume import- 
ance, and to force themselves upon the attention of the legis- 
lative and judicial departments of the State, the reception they 
met with was by no means encouraging. Owing to the then 
established rules relating to parties to actions at law and suits 
in equity, a joint-stock company could not practically sue its 

(b) M'Intyre v. Con mil, 1 Sim. 
X. S. 233. Cost-book mining com- 
panies are partnerships governed by 
special local laws. 

(c) See Walbiirn v. Ingilby, 1 M. 

& K. 76. 

(</) Blundell v. Winsor, 8 Sim. 
601. This subject will be examined 
more fully hereafter. 


own debtors, nor could disputes between its members be tvru. m.t,,ky. 

readily, if at all, adjusted. At tbe same time, the doctrine each member was answerable for the whole of the debts 

of the company was studiously promulgated and rigorously 


Under these circumstances, joint-stock companies were re- Regarded as 

garded as nuisances, and the first legislative enactment relating 

to them (6 Geo. 1, c. 18, commonly called the Bubble act) 
was an attempt to put them down altogether. This attempt 
was simply futile ; and notwithstanding the Bubble act, joint- 
stock companies increased both in number and importance. 
It was not, however, until the end of the first quarter of the 
present century, that the legislature began to retrace its steps. 

In the year 1825 the Bubble act was repealed (e), and from Reaction. 
that time to the present the legislature has endeavoured by 
various means so to amend the law as to give free scope to 
a combination of capital, and at the same time to prevent 
injustice being clone either to or by its subscribers. 

Even when the opposition which joint-stock companies had Charters, 
to encounter was greatest, they could always apply to the 
Crown for a charter of incorporation. Whether a charter 
would be granted, depended mainly on the opinion which the 
officers of the Crown entertained of the proposed objects and 
constitution of the company. If a charter was granted, the 
company became a corporation for all intents and purposes ; 
and with this amongst other results, viz., that the members 
of the company were rendered personally irresponsible for its 
debts. At common law, the Crown had no power to grant 
charters of incorporation, and also to declare that the persons 
incorporated by them should be subject to the same liabilities 
as members of unincorporated societies. 

But in 1825 an act was passed, empowering the Crown to 6 Geo. 4, c. 01. 
grant charters of incorporation, and at the same time to 
declare that the persons incorporated should be personally 
liable for the debts of the body corporate (/). This act was, 4 & 5 ffm. 4, 

c 94 

m the year 1834, followed by another, enabling the Crown, 

0) 6 Geo. 4, c. 91. The 2nd 114. 
section of the Bubble act had been (/) 6 Geo. 4, c. 91, § 2. 

previously repealed by 5 Geo. 4, c. 

j; 2 


Introductory, without incorporating a company at all, to confer upon it by 
means of letters patent, certain privileges, and especially the 
privilege of suing and being sued in the name of a public 
7 Wm. 4 & officer {()). Both these acts have since been repealed, but 
the powers conferred upon the Crown by the act of 1834, 
are still exercisable under the provisions of the repealing 
act (h). 
Special acts of If a charter could not be obtained from the Crown, a com- 
pany which desired to be legally recognised as such was 
compelled to apply to Parliament for a special act of its own. 
The act usually sought to be obtained was either an act incor- 
porating the company, or an act which, without incorporating 
it, authorised it to sue and be sued by its secretary, or some 
other officer. 

Acts incorporating companies were sometimes silent as to 
the liabilities of their members, and in that case, they were 
not to any extent responsible for the debts of the incorporated 
company. But other incorporating acts rendered the members 
of the company liable for its debts to the extent of their 
respective shares of the nominal capital of the company, or of 
so much thereof as might not have been paid up. 

Acts which did not incorporate companies, but merely em- 
powered them to sue and be sued, invariably, it is believed, 
contained clauses rendering the shareholders liable for the 
debts of the company to the fullest extent. 

Until the year 1826, there was no method by which a com- 
pany could acquire any of the privileges of a corporation, or 
the power of suing and being sued by a public officer, except 
by means of a special application to the Crown or to Parlia- 
7 Geo. 4, c 46. ment. But in 1826 a general act was passed enabling joint- 
stock banking companies to obtain the power of suing and 
being sued in the name of a public officer, by simply comply- 
ing with certain specified conditions, and making certain re- 
7 & 8 Yict. turns to the stamp office (/). And in the year 1814, another 
general act was passed, enabling all companies (with some 
exceptions) to obtain from an office in London a certificate of 

(g) 4 & 5 Wm. 4, c. 94. 47 & 48 Vict. c. 5G, § 1. 

(h) 7 Wm. 4 & 1 Yiet. c. 73, and (i) 7 Geo. 4, c. 46. 


incorporation without applying either for a charter, or for an Ihthoductory. 
act of Parliament (A;). But, what is not a little remarkable 7 & 8 Vict, 
is, in this very same year, 1841, the legislature retraced its c ' l13 ' 
steps as regards banking companies, and compelled banking 
companies formed after May, 1844, to apply to the Crown 
for incorporation. This the Crown was empowered to grant, 
without however limiting the liability of the shareholders (I). 

As regards liability to creditors, companies formed under these Limited 
acts were essentially partnerships. Their members were liable lbbilit; '- 
to their last farthing for the debts of the companies ; only before 
recourse for payment of such debts could be had against an 
individual member, it was necessary for the creditors to show 
that they could not obtain payment from the company to 
which that member belonged. Companies which desired 
limited liability in any other sense than this, were still obliged 
to procure a charier from the Crown, or a special act of Par- 
liament, and it was not until the year 1855 (>») that the law in 
this respect was altered. In that year, however, an act was is & 19 Vict, 
passed enabling companies registered under the general act of ' 133, 
1844 (other than insurance companies), to obtain a certificate 
of incorporation with limited liability (//). 

None of these acts provided for the dissolution and winding Winding up 
up of companies. The first act upon this subject was passed acts " 
in 1844, and it declared what were to be deemed acts of bank- c. lit. 1V ' 
ruptcy in the case of joint-stock companies, and how bankrupt 
companies were to be wound up for the benefit of their credi- 
tors (o). In the year 1840 an act was passed for winding up 9 k 10 Vict, 
railway companies projected before July, 1846, and not incor- °' 28 ' 
porated by act of Parliament (p). In 1848 and 1849, two 11 & 12 Vict. c. 
statutes were passed enabling joint-stock companies generally v ^ t a ° d Jo* 13 
to be dissolved and wound up in equity without the necessity 
of a bill to which all the shareholders must have been par- 
ties (q). The following year, 1S50, produced another act for 13 & U Vict. 

C. b'<i. 

(k) 7 & 8 Viet. c. 110. partnerships with limited liability 

(/) 7 & 8 Vict. c. 113. („) 18 & 19 Vict. c. 133. 

(m) Long before this, however, (o) 7 & 8 Vict. c. 111. 

the Parliament of Ireland had (p) 9 & 10 Vict. c. 28. 

passed an act (21 & 22 Geo. 3, c. (q) 11 & 12 Vict. c. 45, and 12 

46), authorising the formation of & 13 Vict. c. 108. 



Introductory, winding up railway companies incorporated by special acts of 
their own (r) . 

Acts of 1856-7. A rapid sketch has now been given of the progress of joint- 
stock company legislation down to the year 1856. In 1856 
and 1857 acts (s) were passed, repealing more or less nearly 
all the acts which have been noticed, consolidating what were 
supposed to be their most valuable provisions, and introducing 

Act of 1862. extensive alterations of an entirely new character. These 
acts, however, were themselves repealed by the Companies act, 
1862 (t), which is now the principal statute relating to joint- 
stock companies, and will be found printed in the appendix at 
the end of this treatise. In the same year, 1862, a very im- 
portant statute was passed relating to industrial and provident 
societies (u), and placing them on much the same footing as 
limited joint-stock companies. 

In addition to the statutes which have been referred to 
already, there was an important act passed in the year 1838, 
enabling separate creditors of shareholders in public companies 
to obtain an order charging their debtors' shares, whereby 
payment of their debts can be obtained without the interven- 
tion of a sheriff and a seizure by him of the property of the 
company (a?) ; and in the year 1841 another act was passed, 
enabling the Court of Chanceiy, on a summary application, to 
restrain any public company from allowing any specified share- 
holder to transfer his shares or to receive dividends in respect 
of them {y). 

8 & 9 Vict. c. 16. The year 1845 produced three statutes incorporating clauses 
usually inserted in special acts of Parliament relating to rail- 
way and other companies which interfere with private property; 
and of these statutes, one, viz., the Companies clauses con- 
solidation act {z) , forms an important part of the law to which 
this treatise relates. 

Other statutes 
1 & 2 Vict, 
c. 110. 

5 Vict c. 5. 

(r) 13 & 14 Vict. c. 83. 

(s) 19 & 20 Vict. c. 47, and 20 & 
21 Vict. c. 14. 

(t) 25 & 26 Vict. c. 89, amended 
by 30 & 31 Vict. c. 47, and c. 131 ; 
33 & 34 Vict. c. 104 ; 40 & 41 Vict, 
c. 26 ; 42 & 43 Vict. c. 76 ; 43 Vict, 
r. 19 ; 46 & 47 Vict. c. 28, and c. 30; 

and 49 Vict, c. 23. 

(w) 25 & 26 Vict. c. 87, repealed 
by 39 & 40 Vict. c. 45. A note on 
these societies will be found in the 

(z) 1 & 2 Vict. c. 110, § 14 et seq. 

(y) 5 Vict. c. 5, § 4. 

(z) 8 & 9 Vict, c. 16, amended by 


111 1865, after a long and arduous struggle, an act (Bovill's [hteodwotort. 

act) was passed extending the principle of limited liability to 28 & 29 Vict. 
large classes of persons previously excluded from it, and 
enabling them to lend their money and render their services in 
consideration of a share of profits, without thereby exposing 
themselves to indefinite Losses. This act is discussed in the 
volume relating to Partnerships. 

The criminal law applicable to partners and directors, with 
respect to thefts, embezzlements, fraudulent accounts, and 
statements, was amended in 18C>1 and 1808 ; and within the 
last few years important arts have been passed relating to 
Cost-book mining companies and Life insurance companies. 

In the appendix will be found a chronological list of the 
statutes relating to companies so far as they fall within the 
scope of this work, and also a table showing which of these 
statutes are now in force. 

3. Different sort* of companies. 

Associations of persons having gain for their object, will be Different Borts 
r if r- of partnerships 

found to belong to one or other of the following classes, and companies. 

viz. : — 

1. Partnerships in the proper sense of the word. Partnerships. 

2. Partnerships with more members than usual, and with Lir — partner- 

transferable shares. To this class belong all joint-stock com- 
panies which do not belong to one or other of the classes 

3. Partnerships governed by certain local customs which Partner-hips 

iii i t • -i governed by 

exclude those laws, applicable to partnerships generally, with local customs. 
which the customs are inconsistent. To this class belong 
Cost-book mining companies. 

4. Partnerships privileged by the Crown or the legislature Partnerships 

, empowered t.> 

to sue and be sued by a public officer. These companies are sue and be sued, 
sometimes said to be quasi incorporated ; they include joint- 
stock banking companies, governed by the act of 7 Geo. 4, 
c. 46, joint-stock companies governed by the Letters Patent 

26 & 27 Vict. c. 118 ; 32 & 33 Vict. c. 48 ; 38 & 39 Vict. c. 66 ; and by 
47 & 48 Vict, c, 43. 




Introductory. ac t of 7 Will. 4 & 1 Yict. c. 73, and a number of insurance 
and other companies governed by special acts of their own. 

5. Corporations in the proper sense of the term, the mem- 
bers of which are to no extent liable to the debts of the body 
corporate. These must be created either by royal charter or 
by act of Parliament, and to them the law of ordinary partner- 
ships has little, if any, application. 

6. Partnerships incorporated by royal charter or act of 
Parliament, but so nevertheless, as to leave their members 
more or less liable to the debts of the whole body. Com- 
panies governed by the Companies clauses consolidation act 
are, and banking companies governed by the repealed act of 
7 & 8 Yict. c. 113, were, types of this class. 

7. Partnerships incorporated by registration. These con- 
stitute the great mass of joint-stock companies, and are of 
two sorts, according as the liability of the members for the 
debts of the body corporate is unlimited, or limited. 

The first sort included all joint-stock companies governed 
by the repealed act of the 7 & 8 Vict. c. 110, and it includes 
all unlimited companies registered under the acts of 1856-8, or 
under the Companies act, 1862. 

The second sort included those companies which availed 
themselves of the short-lived act of the 18 & 19 Vict. c. 93, 
and now includes all companies registered as limited com- 
panies under the acts of 1856-8, or under the Companies act, 

Limited liability companies again are of two sorts, viz., 
1, those in which the liability of the members is limited by the 
amount of their shares; and 2, those in which the liability of 
the members is limited by guarantee ; i.e., by the amount they 
have respectively undertaken to pay in the event of a con- 
tribution becoming necessary in order to discharge the liabi- 
lities of the company (b). Companies limited by guarantee 
may have their capitals divided into shares or not (c), and are 
supposed to admit of greater varieties of internal organisation 




(«) To this class also belonged 
Irish anonymous partnerships, go- 
verned by 21 & 22 Geo. 3, c. 4G 

(Irish), repealed by the Companies 

act, 1862. 

(b) 25 & 26 Yict. c. 80, § 7. 

(c) lb. § 14. 


than companies limited by shares. The latter, however, are Ihtkoductobt. 
much the more numerous. 

The following table conveniently exhibits the above class 
of companies. 

Large Partnerships. 

r<>.st-I5<>ok Mining ( Companies. 

inking ( !ompanies 
verned by 7 Geo. 4, 
c. 46. 

/ Unincor- 

Joint Stock 

( lompanies empowered 
to sue and lie sued 
by a public officer, 

Companies governed by 
t!ic Letters Patenl Acl 
(7 Wm. 4&1 Vict. c. 73). 

' !ompanies having special 
Acts of their own. 

ated by 

'Special Act of Parliament, e.g., Railway, ('anal, 
Dock, and Waterworks Companies. 

In which the members are not lia- 
ble to the debts of the company. 

Royal Charter 


In which the members are liable 
to the debts of the company. 

'Without limited liability. 

limited by shares. 

limited by guarantee. 



For some purposes, and particularly in order properly to Public com- 
interpret certain statutes (</), it is necessary to distinguish panies ' 
public companies from others. But in this, as in many other 
instances, the word public is used with no definite significa- 
tion ; and it is extremely difficult to say exactly what the 
essential character of a public company really is. It has, 
however, been decided that banking companies, governed by 
the 7 Geo. 4, c. 46, are public companies within the meaning 
of the statute 1 & 2 Vict. c. 110, s. 14 (c) ; and that an in- 
surance company governed by a special act of its own was a 
public company within the meaning of the Apportionment act 

(d) The statutes here referred to members of companies ; 33 & 34 
are : 1 & 2 Vict. c. 110, § 14, relating 
to executions against shareholders 
for their separate debts ; 24 & 25 
Vict. c. 96, §§ 81 to 84, relating to 
frauds by directors, officers, and 

Vict. c. 35, § 5, relating to the ap- 
portionment of dividends. 

(V) M'Intyre v. Connett, 1 Sim. N. 
S. 225. 


Introductory^ f iqjq ( /*). j t WO uld however seem that those companies 
only are public which are either incorporated, or, if unincor- 
porated, are endowed by the Crown or the legislature with some 
special privileges, and are bound to make some kind of return 
or list of their officers or members which the public have a 
right to see. A mere partnership, however large and however 
transferable its shares, is apparently not a public company (g). 

Companies not Companies formed for merely scientific, literary, artistic, or 
charitable purposes, and not with any view to the acquisi- 
tion of gain or the avoidance of loss by themselves or their 
members do not fall within the scope of this treatise, which 
is confined to companies formed for the purpose of acquiring 
and dividing profit in some form or other, or, as in the case of 
mutual insurance companies, of avoiding loss. 

Owing to the course legislation has taken and to the classes 
into which companies must be divided if confusion is to be 
avoided, it is absolutely necessary to consider companies not 
only with reference to general principles more or less applicable 
to them all, but also particularly with reference to the statutes 
applicable to their several sorts, viz. : — 

1. The Banking act of 7 Geo. 4, c. 46. 

2. The Letters Patent act, 7 Win. 4 & 1 Vict. c. 73. 

3. The Companies clauses consolidation act, 8 & 9 Vict. 
c. 16. 

4. The Companies act, 186*2. 

(/) Can v. Griffith, 12 Ch. D. (g) See the last two ca-'jes, and 

655. Jones v. Ogle, 8 Ch. 192. 




General observations. 
A company, so far as it is only a partnership consisting of a Book I. 

large number of persons having a joint stock, and associated Companies as 
for the purpose of sharing profits, is formed in precisely the fronTpartn •'-■- 
same manner as any other partnership, viz., by agreement ; sl " p ' - 
and after what has been stated in the volume on Partnership, 
it is unnecessary to dwell upon the formation of those com- 
panies which, being unincorporated and subject to no statutory 
provisions have nothing to distinguish them from societies the 
nature and formation of which have been explained in that 

With respect to other companies, an agreement to share Agreement the 

c, .11 • i , , basis of com- 

prohts or to take shares is more or less remotely the basis of pmies. 
them all. 

Indeed, except where a person is made a member of a com- 
pany by some act of Parliament which there is no gainsaying, 
it may be safely laid down that no person can become an 
original member (a) of a company in the absence of some agree- 
ment, express or implied, between himself and the company ; 
and further that every person who has agreed with a company 
to become a member of it can compel the company to do what 
is necessary to constitute him a member ; and can on the 
other hand be himself compelled to do what is necessary to 
become a member, or to submit to the completion by the com- 
pany of those formal acts, e.g., registration, which may be 
necessary to make him, in point of law, a member of it. 

What is necessary to constitute a binding agreement with a 

(n) Members by transfer from other members are not here referred tc. 



Book I. company to become a member of it, is determined by the 
general law of contracts as applied to the'company in question ; 
and what is necessaiy to become an actual member of any 
particular company depends upon the nature of that company, 
i.e., upon its own regulations, or the statutory enactments 
relating to it. Each inquiry involves some examination into the 
nature of the company under consideration ; for contracts with 
it depend for their validity on the authority of the persons who 
enter into those contracts on behalf of the company ; and what 
constitutes membership depends entirely on the kind of com- 
pany which is spoken of. Both of these matters will be 
examined hereafter. 

Prospectus. Practically the great bulk of companies are formed as 

follows. A few persons called promoters form a scheme by which 
they sa%- money may be made but requiring considerable funds 
for its realisation. To make their scheme known and to raise 
the funds required, they publish a prospectus, setting forth the 
nature of the scheme and the amount of Capital necessary to 
cany it out, and inviting persons to become subscribers. 
Sometimes the prospectus is issued before any company has any 
legal existence ; at other times the promoters or their friends 
do what is necessary to create the company as a legal body and 
issue the prospectus after the company has been created. In 
either case the prospectus is a very important document ; for on 
the faith of it persons are intended to apply, and do in fact 
apply, for shares in the company to be formed or already 
formed as the case may be. 

Promoters. The relation between the promoters of a company on the one 

hand and the company and its members on the other is 
extremely complex, and will be examined hereafter; but in 
order to understand that relation it is necessary to explain the 
mode in which companies are formed and the doctrines of 
agenc} r as applied to them. These subjects will be dealt with 
in Books I. and II. ; and the relation of promoters to their 
companies will be discussed in Book III. 





Agreements to take shares in a company about to be formed I;L }■ Cha P- L 

(or if technically formed already having its capital still unsub- 

scribed), are usually enteredinto by an application for shares on 

the one hand and by an acceptance of such application on the 

In practice, the application is generally a printed form of Application for 
request, addressed to the secretary or directors of the company, 
or to persons named by the projectors, and expressing an agree- 
ment on the part of the applicant to take a certain number of 
shares in the company, or such smaller number as may be 
allotted to him. The form is signed by the applicant, and he 
generally pays to the bankers of the company or projected 
company a small deposit on each share applied for, and obtains 
from the bankers a receipt for the payment. The payment is 
usually made before or at the time when the application is 
sent in. 

The application for shares, in whatever form it is made, and Application for 

shares revoked 

whether accompanied by the payment of a deposit or not, is before allotment. 
only an offer to take the shares applied for, and may, like any 
other offer, be retracted before it has been accepted (a). Nor 
is this right to revoke excluded by the insertion in the applica- 
tion of words to the effect that the applicant agrees to accept 
the shares applied for, or any less number that may be allotted 
to him, and consents to be registered in respect of them; for 

(a) Ritso's case, 4 Ch. D. 774, 1 Ex. 109. See, also, Chapman's 

where the applicant was a director ; case, 2 Eq. 567 ; HeWs case, 4 Eq. 

Gledhill's case, 3 De G. F. & J. 713 ; 9 ; Pentelows case, 4 Ch. 178 ; Slat- 

Ramsgate Victoria Hotel Co. v. Monte- tery's case, 7 Ir. R. Eq. 243. 
fiore, and Same v. Goldsmid, L. R. 



bk. I. Chap. 1. 
Sect. 1. 

Letter of allot- 


complete by 
allotment and 

such words themselves only amount to an offer and do not 
constitute an agreement until the offer they express has been 
accepted (b). But a revocation received after notice of accept- 
ance has been posted is too late (c), even though the letter of 
revocation is written and posted before the letter of application 
is received (<l). 

If the application for shares is acceded to, a letter of allot- 
ment is usually sent to the applicant, informing him that so 
many shares have been (or will be) allotted to him, and that a 
certain sum, by way of deposit on each share, must be paid to 
the bankers of the company. 

A letter of allotment requires a pemry stamp (e). 

In order that the application and acceptance may constitute 
a binding agreement the acceptance must be by persons who 
can bind the company (ee) ; and must be notified to the 

But, unless under special circumstances, notice of allotment 
must be given to the applicant or his agent in order to bind 
the allottee (/). Notice by post is sufficient (g), even if the 
notice should fail to reach the allottee or his agent, either 
owing to the default of the allottee (h) or to some casualty in 
the post office establishment (i). It is not, however, necessary 
to prove express formal notice of the allotment, it is sufficient 
to show that the allottee in fact knew of it (k). 

(b) See Ward's case, 10 Eq. 659, green's and Carrall's case, 3 Ch. 323. 

and Best's case, 2 De G. J. & Sm. 
650 ; Chapman's case, 2 Eq. 567. 

(c) See Harris' case, 7 Ch. 587. 

(d) Byrne v. Van Tienhoven, 5 C. 
P. D. 344 ; Stevenson v. McLean, 5 
Q. B. D. 346. 

(e) 33 & 34 Vict, c. 97, § 3. For- 
merly this was not so. See Vollans 
v. Fletcher, 1 Ex. 20 ; Moore v. Gar- 
wood, 4 ib. 681. 

(ee) Infra, Bk. ii. c 2, and Ex 
parte Smith, 39 Ch. T). 546. 

(/) Gunn's case, 3 Ch. 40 ; Robin- 
son's case, 4 ib. 322 ; Wallis's case, 
ib. 325, note ; Ilebbs's case, 4 Eq. 9 ; 
Shackleford's case, 1 Ch. 567; Ward's 
case, 10 Eq. 659, where the allottee 
bad si "ned a blank transfer ; Said- 

See, also, Pellatt's case, 2 Ch. 527 ; 
Shackleford's case, 1 Ch. 567. 

(g) Household Fire Insurance Co. 
v. Grant, 4 Ex. D. 216 ; Harris's case, 
7 Ch. 587 ; Wall's case, 15 Eq. 18. 

(h) Townsend's case, 13 Eq. 148. 

(i) Household Fire Insurance Co. 
v. Grant, 4 Ex. D. 216 (overruling 
on this point British and American 
Tel, Co. v. Colson, L. B. 6 Ex. 108 ; 
Reidpath's case, 11 Eq. 86) ; Harris' 
case, 7 Ch. 587. 

(/.•) Levita's case, 3 Ch. 36 ; Craw- 
Iqi's case, 4 ib. 322. In both of these 
the allottee had acted as a share- 
holder. See also Richards v. Home 
Assurance Association, L. B. 6 C. 
P. 591, where the allottee became 


Moreover, an applicant may dispense with notice of allot- Bk - J ,- Cua P- ] - 

• . i. 

ment or preclude himself from objecting to its non-receipt (I). 

Notice of allotment sent to the allottee to the address given 

by him will be sufficient, although, owing to the insufficiency 

of the address, the notice never reaches him (m). 

If no time is fixed for the acceptance of the application, and Tilae forallot- 

... . ""■■' it - 

it is not accepted within a reasonable time, it will be considered 

as having been declined (n). What is a reasonable time must 

depend on the circumstances of each particular case ; and a 

prudent applicant who does not receive an answer in what he 

considers reasonable time, should revoke his application. 

The acceptance by a company of the offer contained in an Acceptance 

without allot- 
application for shares may, it is conceived, be evidenced other- ment. 

wise than by an actual allotment. Sometimes the offer by the 
company precedes the application, so that the application is in 
truth an acceptance of a prior offer ; and where this is the case 
an allotment is not necessary to complete the contract, although 
it may be necessary to constitute the applicant an actual share- 
holder^). But allotment is the ordinary evidence of accept- 
ance ; and where there has been no allotment, acceptance will 
not be inferred from the mere facts that the applicant paid a 
deposit on the shares at the time he applied for them ; that he 
obtained a receipt for the amount of his deposit, and that the 
money has not been returned to him (p) ; nor from the fact 
that as a director he ought to have had shares (#). 

manager. Compare Pellattfs case, 17 Sim. 163 ; Mathew's case, 3 De 

•1 Ch. 527, where a demand for calls G. & Sm. 234. See, too, Onion's 

was lield not notice. case, 1 Sim. N. S. 394 ; Conway's 

(I) As in Bloxam's case, 33 Beav. case, 5 De G. & S. 150; Sharp and 

529, aff. on appeal, 4 De G. J. & Sm. James's case, 1 De G. Mac. & G. 

447. This case is regarded as 565 ; Ex parte Roberts, 1 Drew. 

having turned on its own special 204 

circumstances, and has not heen (o) See Adams' case, 13 Eq. 474, 

followed. See the cases referred to where one company transferred its 

above. See, also, as to directors, business to another ; Bird's case, 4 

Harward's case, 13 Eq. 30 ; Leehe's De G. J. & Sm. 200. 

case, 6 Ch. 469. (p) Best's case, 2 De G. J. & Sm. 

(m) Townsend's case, 13 Eq. 148. 650. See, also, Ramsgate Victoria 

(a) Ramsgate Hotel Co. v. Monte- Hotel Co. v. Montefiore, and Same v. 

fiore, and Same v. Goldsmid, L. B. 1 Goldsmid, L. R. 1 Ex. 109. 

Ex. 109 ; Ex parte Bailey, 3 Ch. 592, (q) See Chapman's case, 2 Eq. 567. 

and 5 Eq. 428 ; Carmichael's case, Abercorn's case, 4 De G. F. & J. 78, 


Bk. I. Chap. l. I n order that an application for shares and an acceptance 
- of it (by allotment or otherwise) may constitute a concluded 

Unconcluded .. , . . 

agreements. agreement between the applicant and the company or its 
directors, it is essential that the acceptance shall be in strict 
conformity with the application, and not depart from it in any 
material respect. If it does, the acceptance, even if in the 
form of a letter of allotment, must be regarded as a new offer, 
which the applicant for shares is at liberty to accept or decline ; 
and there will be no concluded agreement until the new offer 
has been accepted (/■). This has been decided where shares 
were applied for and those allotted were " not transferable " (s); 
so where the allotment was made subject to forfeiture on non- 
compliance with certain conditions (t) ; so where 100 shares 
were applied for and only 25 were allotted (u) ; so where 20/. 
shares were applied for and 40/. shares were allotted (,r). So 
where the secretary of a company wrote to a provisional com- 
mittee-man to say that shares had been allotted to him, and 
asking whether he would accept them ; and in answer, the 
allottee requested that the shares in question might be "re- 
served for him," an issue was directed to try the question 
whether the answer amounted to an acceptance of the offer or 
not (//). There are several other cases illustrating the same 
principle, to which however it is unnecessary more particularly 
to allude (z). 

and others of that class noticed here- "where the new term was accepted 

after under the head Contributories. by payment, and with PerreWs case, 

(;•) See the next four notes, and 15 Eq. 230, where repudiation came 

compare with them Harris case, 7 too late. 

Ch. 587; Peek's case, 4 Ch. 532, (») Ex parte Roberts, 1 Drew. 204 ; 

where the term as to payment was Re Barber, 15 Jur. 51. The common 

held no qualification. form of application now in use, is 

(s) Duke v. Andrews, 2 Ex. 290. for a certain number of shares, or 

See, too, Wontner v. Shairp, 4 C. B. such smaller number as may be 

404 ; Vollans v. Fletcher, 1 Ex. 20, allotted. 

and compare Hutton v. Upfill, 2 H. (.<•) See Custard's case, 8 Ecp 438, 

L. C. 674. where the bargain as to the 20/. 

(t) Jackson v. Turquand, L. R. 4 shares was held binding, but there 

H. L. 305, affirming AddineWs case, was no bargain for 401. shares. 

1 Eq. 225 ; Oriental Inland Steam (?/) Onion's case, 1 Sim. N. S. 394. 

Co. v. Briggs, 8 Jur. K. S. 801, and See, too, Mainivaring's case, 2 De G. 

4 De G. F. & J. 191. Compare ]VJ.eK:0. 66. 

these with Barrett's case, 2 Dr. & (:) See infra, book iv., under the 

Sm. 415, and 3 De G. J. & Sm. 30, head Contributories. 


Moreover, in cases of this kind, the facts that shares have Ek - l - C,1R P- *• 

. 1- 

heen allotted to the applicant, and that he; has been registered - 

in respect of them and has applied for certificates, do not 

conclusively show an acceptance by him of the new terms (a). 

Again, if an offer is made to take shares conditionally or Conditional 

upon unusual terms, a clear acceptance of these conditions or 
tonus must be proved in order to constitute a binding agree- 
ment : and the mere fact that shares have been placed in the 
applicant's name is not sufficient to biml him. Thus, in 
Shackleford's casc(b), a person applied for shares upon the rd's 

terms that he should have the refusal of certain contracts and 
pay for the shares in goods and not in cash. There was no 
distinct evidence that this oiler was accepted. The shares 
applied for were, however, in fact allotted to him and placed 
in his name; and although no notice of the allotment was sent 
to him, there was evidence t) show that he was aware that 
shares had been given to him. It was nevertheless held that 
no concluded agreement had been entered into, and that the 
applicant had not become a shareholder. 

The conditions, moreover, must be assented to by those who 
are competent to bind the company (see Book II., c. 2). There- 
fore, where a person applied for shares upon certain terms 
which were assented to by the manager and two directors, 
when by the constitution of the company three directors were 
required to bind the company, it was held that there was 
no binding agreement, although the board of directors had 
delegated the allotment of shares to the manager and the two 
directors in question (c). 

It is a necessary consequence of the same principle that if 
the conditions are such that the company cannot lawfully assent 
to them there is no binding agreement (d). 

An application for shares upon terms not assented to must 
not be confounded with an application for shares upon condi- 
tions which are assented to but are not performed. In the 

(a) Beck's case, 9 Ch. 392. See, (d) See Bank of Hindustan v. 

also, Wynne's ceise, 8 Ch. 1002. Alison, L. R. 6 C. P. 54 & 222 ; 

(/() 1 Ch. 507. See, also, Rogers' Stace and Worth's case, 4 Ch. G82 ; 

case, 3 Ch. 633. Pellatt's case, 2 Ch. 527 ; Sunn's case, 

(c) Howard's case, 1 Ch. 561. 2 De G. F. & J. 275. 

L.C. C 



i:k. I. Chap. l. f irs t case, there is no agreement at all: in the second case, 

Sect. 1. ' & ' ' 

there is a concluded agreement, and its effect with reference to 

the question whether the applicant has hecome a member or 
not, turns on other considerations ; viz., 1. Has the condition 
been performed ? if not, then 2. Is the condition precedent 
or subsequent with reference to becoming a member? if 
precedent, then 3. Has the performance of it been waived ? 
These matters will be more full}* discussed when membership 
is being examined. 

Agreements to take shares can be enforced by action; but it 
is a well settled principle of the Law of Partnership (e) that an 
agreement to share profits does not create a partnership so 
long as anything remains to be done before the right to share 
them accrues. It consequently follows that neither the pro- 
jectors of, nor the subscribers to, a company in course of 
formation are partners (/) : nor are the}-, simply by reason of 
their position as projectors or subscribers, liable for each 
other's acts as if they were partners (g). It becomes therefore 
important to distinguish clearly a company which is formed 
from one which is being formed ; and this is by no means 
always an easy matter (/<). When indeed a company is incor- 
porated by special act of Parliament, by charter, or by regis- 
tration, the moment of its formation is coincident with the 
date of its incorporation, and is accurately determinable ; but 
where a company is not incorporated it is often difficult to fix 
the time at which the agreement to form it became replaced by 
a contract of present partnership. The test is whether any- 
thing still remains to be done before the relation of partners is 
created (/). 

Efi'ect of an 
agreement to 
lake shares. 

Forming and 
formed com- 

(e) Part. 20 et seq. a comj)any can be said to have been 

(/) lb. and infra, Ek. II. c. 1, commenced, see Baler v. Plaskitt, 5 

sec. 1. C. B. 262. 

{g) lb. and infra, Bk. II. c. 1, (i) Part. 23 et seq. and infra, 

sec. 1. Bk. II. c. 1. 

(h) As to when the formation of 



( >ne of the first steps in the formation of a company is the Bk. I. Chap. 1. 
publication b} r its projectors of a prospectus, setting forth the 
nature and objects of the proposed company, the number and ' "'' 
value of the shares intended to be created, and the amount of 
capital supposed to be required. The public is invited to 
subscribe to the company thus proposed to be formed : in 
other words, persons arc invited by advertisements, circulars, 
&c, to enter into an agreement to take shares in a company, 
such as that described, when the same shall have been formed. 
Those who sign such an agreement, whether by themselves or 
by their agent (k), become subscribers to the undertaking in 
the proper sense of the word (/). 

The prospectus issued to the public must, in the absence of Prospectus not 

ti'llicrcJ. to* 

evidence to the contrary, be regarded as the basis of the agree- 
ment which results from an application for shares by a person 
who has seen the prospectus, and an allotment to him(m). 
Hence, if a person applies for shares in a company upon the 
faith of a prospectus issued by its promoters or directors, and 
he receives in answer to his application an allotment of shares 
in a company to which the prospectus does not apply, he is at 
liberty to decline to accept such shares ; for they are not in 
truth what he asked for. Nor will even payment of a deposit Effect of paying 

, , . ., ,, ,/ . , . for shares allot- 

by him upon the shares allotted be conclusive evidence against ted when diffe- 

him of an assent by him to take the shares allotted ; for he is ™£ed fo™ L 
entitled to assume that he has received what he applied for ; 
and unless it can be shown that when he paid the deposit he 
did not act on that assumption, he is, notwithstanding such 
payment, entitled to say he has entered into no binding con- 
tract (»)• 

(/;) Be Whitley Partners Ld., 32, the meaning of an act incorporating 

Ch. D. 337. the subscribers to a projected com- 

(Z) Burke v. Lechmere, L. E. 6 Q. pany. 

B. 297 ; Thames Tunnel Company v. (to) See Putsford v. Richards, 17 

Sheldon, 6 B. & C. 341, decided that Beav. 87 ; Jennings v. Broughton, ib. 

a person who had signed nothing, 234 ; Fox v. Clifton, 6 Bing. 776, 

but had applied for shares and had infra. Compare Gerhard v. Bates, 2 

paid a deposit on those allotted to E. & B. 470. 

him, was not a subscriber within (n) Dowries v. Sliip, L. R. 3 H. 

c -J 


Bk. I. Chap. 1. The following are leading cases on this bead. 

The prospectus of the Merionethshire Slate and Slate Slab 

Stete°Company. Company stated the objects of the company to be to work a 
particular slate quarry in Wales. The company was formed 
for the purpose of working not only that quarry, but any slate 
quarry in Great Britain or Ireland. It was held that a person 
who had applied for shares on the faith of the prospectus, and 
had on his application agreed to execute the company's deed 
of settlement, and had had shares allotted to him, and had 
paid a deposit upon their allotment, was nevertheless not bound 
to take such shares. He never had, in fact, agreed to take 
shares in such a company as was ultimately formed (o). 
Scottish Finance The prospectus of the Scottish and Universal Finance Bank 
described the objects of the company to be general banking- 
purposes, and the purchase, importation, and exportation of 
specie. The objects of the company as formed went far beyond 
this, and included, amongst other things, obtaining concessions 
for the construction of railway and other works, and the leasing 
or working such undertakings, and the transaction of the 
business of a merchant, contractor, and capitalist, as principal 
or agent in any part of the world. It was held, first by the 
V.-C. Wood, and afterwards by the Court of Appeal, that a 
person who applied for shares on the faith of the prospectus, 
and to whom shares were allotted, had not agreed to become a 
member in the company ; he never having been aware that the 
company was formed for purposes so materially different from 
those stated in the prospectus (_/>). 
Russian Iron The prospectus of the Russian Vyksounski Iron-works Com- 

„omi>any. pany stated that the objects of the projected company were to 

acquire, work, and extend certain specified iron-works in Russia. 
The objects of the compairy as formed were to acquire and 
work iron mines and works in Russia generally, and to work 
mines, build ships, forge, cast, and roll iron, to construct 
wrought and cast iron work, and to manufacture all kinds of 
engines and engineering work. It was held, in this case also, 

L. 356, 358, and Blaclcbum's case, 3 (p) SMjj's case, 2 De G. J. & Sm. 

Drew. 409, noticed infra. 544,-and Doicncs v. Ship, L. R. 3 H. 

(p) Rye's car, 3 Jur. N. S. 4G0, L. 343. 
V.-C. S. 


that applicants for shares on the faith of the prospectus, and 1;k - *■ Chap. 1. 
to whom shares had been allotted, but whose attention had 
never been drawn to the variance between the objects of the 
company as formed and those advertised, were at liberty to 
repudiate their shares on discovering the variation (q). 

The prospectus of the Scottish Petroleum Con/puny named TI >e Scottish 
G. and R. as two of the directors. Anderson, on the faith of Company. 
this statement, applied for shares in the company, but before Anderson's case 
any shares were allotted to him both G. and R. had refused to 
be appointed directors. It was held that Anderson under 
these circumstances was at liberty to repudiate the shares 
allotted to him (;•). 

Many cases under the older winding-up acts illustrate the 
same principle and may still be usefully referred to where the 
right to repudiate is not lost by reason of the winding up of 
the company (s). 

Other illustrations of the same principle arc afforded by Companies 
those cases in which the liability of subscribers to projected socm . ( 
companies for debts contracted by the directors has been dis- 
cussed. These cases establish that persons who agree to 
become members of a company to be formed upon certain 
terms and for certain purposes are not liable for debts con- 
tracted by the directors before the company is formed as 
contemplated ; unless the subscribers have rendered themselves 
liable to such debts otherwise than by their agreement to take 

Thus in Fox v. Clifton (t ), it was held that the defendants Fox r. Clifton. 
who had applied for shares in a company, had had them 
allotted, and had paid a deposit in respect of them, were not 

(q) Stewart's case, 1 Ch. 574 ; case, 16 Beav. 262 ; Meyers case, ib. 

Webster's case, 2 Ecp 741. 383. 

(r) Anderson's case, 17 Ch. D. (t) 6 Bing. 776. See, also, Bourne 
373 ; and see In re Scottish Petroleum v. Freeth, 9 B. & C. 632 ; Pitchford 
Co., 23 Ch. D. 413. And compare v. Davis, 5 M. & W. 2 ; Vice v. 
Smith v. Chadwick, 20 Ch. D. 27, Anson, 7 B. & C. 409. Perring v. 
and 9 App. Ca. 187 ; Hallows v. Hone, 4 Bing. 28, so far as it decided 
Fernie, 3 Ch. 467, where the direc- that persons become partners by sub- 
tors resigned after the shares had scribing to an inchoate company, 
been allotted. must be regarded as overruled by 

(.s) Cox's case and Naylor's case, Fox v. Clifton. 
4 K. & J. 308 & 314 ; Goldsmid's 


Bk. I. Chap. l. partners with the projectors of the company, inasmuch as the 
- company in which alone the defendants had agreed to become 
partners was never in fact formed. The capital was never 
subscribed, only a few shares were ever taken up, the deed was 
only signed by a comparatively few persons, and by one only 
of the defendants. The time fixed for its execution had 
elapsed, and it was expressly declared in the prospectus of 
the company, and which prospectus was held to form the basis 
of the contract into which the defendants had entered, that 
every person who should neglect to execute the deed within 
the time fixed should forfeit all share and interest in the com- 
pany. In answer to the argument that the defendants had 
become shareholders in a de facto existing company by pay- 
ment of the deposits, it was observed by the Court : — 

Effect of paying " the paying of the deposits must undoubtedly be taken to imply an assent 
deposit. to t j ie Serins of the advertisement ; that is, an assent to become partners 

in a company raising a capital of 600,000?. consisting of 12,000 shares, and 
to be governed by a deed which should contain the clauses and conditions 
to be agreed on in future ; but we think it implies nothing more, and that 
it cannot be construed as an assent to the terms of a partnership already 
formed. When, therefore, instead of an allotment of 12,000 shares, the 
utmost that were ever allotted scarcely exceeded 7500 ; when, out of that 
number, no more than 2300 ever paid the first instalment ; when not half 
the latter number paid the second instalment, and only sixty-five sub- 
scribers signed the deed ; we think the subscribers were at liberty to say, 
This was not the trading company upon which we paid our deposit ; 
neither the capital nor the number of shares bearing any reasonable 
proportion to the original plan and project. And this the more especially, 
because, by the terms of the advertisement, they were taught to expect 
that the utmost risk which they encountered was the loss of all share and 
interest ' in the concern ' upon their refusal to execute the deed ; which 
loss they appear to have submitted to." 

Change of The foregoing cases must be carefully distinguished from 

riseTor ratified. tnose in which the applicant has authorised or sanctioned an 

allotment of shares to him, with notice of a difference between 

the objects of the company as described in its prospectus and 

its objects as ultimately fixed by the instrument creating the 


Change of "Where there is a special agreement to take shares, and the 

riseTby^edal company as described in the agreement differs in character or 

agreement. purpose from that described in the prospectus, the agreement 


must, in the absence of fraud, be regarded as expressing the Bk I. Chap. l. 

Sent. 2. 

contract into which the parties have entered ; and to the — 
extent to which the agreement and prospectus differ from each 
other the terms of the prospectus must he considered as 
excluded by those of the agreement («). 

Persons who subscribe to projected companies which are to Change of 
be incorporated by act of Parliament or by charter, frequently j.-J^ by form of 
give the managers very extensive powers, and bind themselves a PP Ucallon - 
to take shares in almost any company which the managers 
may be able to induce the legislature or the Crown to incor- 
porate, and which is not altogether of a different nature from 
that proposed. When this is the case, and a company is 
formed, the subscribers will be bound to take shares, and will 
b3 converted into shareholders, if the act or charter so 
declares, although the company actually formed differs both 
in object and constitution from that to which they sul»- 
scribed (x). 

In the Midland Great Western Railway Company v. Midland, &c, 
Gordon (x), a prospectus was issued for the formation <>f a Gordon?' *" 
company to construct a railway from Dublin to Mullingar and 
thence to Athlone. The directors were authorised to apply to 
Parliament for an act, and to do all that was necessary for 
forming a railway as proposed. Scrip certificates for shares 
were issued, and the defendant subscribed for ten shares. 
The directors obtained an act incorporating the comuan}', 
authorising it to make a railway from Dublin to Mullingar 
only, and to purchase a canal existing between Mullingar and 
Athlone, and to work such canal. The act provided that 
every one who should have subscribed to the undertaking or 
should be otherwise entitled to a share, and whose name 
should be entered on the register, should be a shareholder. 
The defendant had sold his scrip, but he was nevertheless 
registered by the company as a shareholder, and he was held 
to be a shareholder notwithstanding his contention that the 
company actually formed was materially different from that to 
which he had subscribed (y). 

(a) London and Continental As- (x) 16 M. & W. 8J4. 

surance Soc. v. Redgrave, 4 C. B. N. (//) Nixon v. Brownlow, 2 II. & N. 

S. 524, and the next note. 4.;5, and 3 ib. 635, and Cork and 



Bk. I. Chap. 1. 
Sect. 2. 

Again, where a banking company was projected with a 
capital of 1,000,000?. to be trebled if necessary, and the sub- 

Mitchell. ' scribers signed an agreement reciting that application had 

been made to the Crown for a charter and nominating certain 
persons with power to arrange the terms of the charter in such 
manner as they should think necessary in compliance with 
the requisitions of the Crown, and to narrow or extend the 
objects of the company as might be necessaiy, it was held 
that a charter incorporating the subscribers with a capital of 
Gll,O00L with power to increase it to 1,000,000?., with the 
consent of the Lords of the Treasury, was one which the 
directors had authority to accept, and that the subscribers 
were bound by it (z). 

Change of Even where the subscribers' agreement is less general in its 

scheme autho- pt->t • ., 

rised by act of language, the terms of the act ol .Parliament incorporating the 
Parliament. company may be such as to convert the subscribers to a com- 
pany of a particular description into shareholders in another 
company materially different from it. A construction of the 
act leading to such a result is to be avoided if possible ; but if 
its language is clear and precise no court can lawfully decline 
to give effect to it, nor hold that a person expressly made a 
shareholder by the legislature is not a shareholder to all 
intents and purposes (a). "When two companies are amalga- 
mated by an act of Parliament which enacts that the share- 
holders of the old companies shall be entitled to shares in the 
new company, nothing more is required to make them members 
thereof (&). 
Change cf A person who has applied for shares and has had them 

scheme subsc- . . . . . . . , . 

fjueutiy assented allotted to him under circumstances which entitle mm to reject 
them, may nevertheless elect to retain them ; and this election 
may be evidenced not only by an express agreement but 
by conduct. It need hardly be added that if a person 
knowing the circumstances which entitle him to reject 

Youghal Bail. Co. v. Paterson, 18 C. 
B. 414, are similar cases. 

(;.) See Norman v. Mitchell, 5 De 
G. M. & G. 648 ; and 10 Beav. 278. 

(a) See Kidwelley Canal Co. v. 
Raby, 2 Price, 93 ; Cromford and 

High Peak Co. v. Lacey, 3 Y. & J. 
80 ; Scott v. Berkeley, 3 C. B. 925. 
(//) Spademan v. Lattimore, 3 GifF. 

16 ; and see Cork and Youghal Pail. 
Co. v. Paterson, 18 C. B. 414. 


shares which have been allotted to him retains them without Bk. I. Chap. I. 

. . Sect. 2. 

objection, and acts as if lie were a shareholder, it will be too - 

late for him afterwards to repudiate them upon the ground 

that the} r were not what he applied for, or upon the ground 

that the terms of the company's prospectus have not been 

adhered to (c). 

]>ut although a person may acquiesce in a change in the Allotment with 

. Tii' n a Ueged notice 

objects oi a company, yet, where those objects are changed of dmnge in 
after an application for shares and before the allotment of M eme " 
them, and the attention of the applicant is not drawn to the 
change, and he is really ignorant of it, the mere fact that 
he receives the shares and pays the deposit on them, will 
not preclude him from denying that he ever agreed to take 
them (d). 

The same principle applies to registered companies ; and it 
has been decided that the mere circumstance that the appli- 
cant receives a letter of allotment or certificate stating that the 
shares are to be held subject to the company's memorandum 
and articles of association is not enough to call his attention 
to a material difference between the prospectus on the faith of 
which he applied for shares, and the memorandum of associa- 
tion which fixes the objects of the company (e). 

But the strong tendency of modern decisions is that as Delay in repu- 
regards companies formed under the Companies Act, 1862, an ' 
allottee of shares wdio does not inform himself of the contents 
of the memorandum of association within a reasonable time, 
and who keeps the shares allotted to him without taking the 
trouble to ascertain whether there is airy discrepancy between 
the prospectus and the memorandum of association, cannot 

(c) See Tredicen v. Bourne, 6 M. by the Vice-Chancellor remains un- 
& W. 461 ; Peel v. Thomas, 15 C. B. impeached. On the appeal addi- 
714 ; Steigenberger v. Can; 3 Man. & tional evidence was adduced and 
Gr. 191 ; London and Continental the Court was satisfied that when 
Assurance Co. v. Redgrave, 4 C. B. Blackburn paid his deposit he must 
N. S. 524. Compare these cases have known what shares he was 
with those on p. 21, note (t). taking. 

(d) Blackburn's case, 3 Drew. 409. (e) Webster s case, 2Eq. 741 ; Ship's 
This case was reversed on appeal case, 2 De G. J. & Sni. 544. See, 
(8 De G. Mae. & G. 177) ; but the also, Beck's case, 9 Ch. 392, where 
principle on which it was decided the allottee was registered. 



Repudiation ill 

Stewart's case. 

Bk. I. Chap. 1. afterwards repudiate the shares (/). In the application, how- 
Sect. 2. , .... ,. . . . 

ever, of this rule, it is important to distinguish cases m which 

the allottee repudiates his shares hefore the company is being 
wound up from those in which he does not (g). The following 
cases, which arose before any winding-up had commenced, may 
be usefully referred to on this head. 

In Stewart" 8 case (Ji) the application to be removed from 
the list was successful although twelve months had elapsed 
since the allotment of shares, and the allottee had in the 
interval tried to sell them, and had attended a meeting called 
for the express object of altering a clause in the articles 
relating to the increase of capital beyond the amount stated 
in the prospectus : but both the V.-C. Wood and the Court 
of Appeal held that these circumstances did not preclude 
the shareholder from having his name removed, it being 
clearly proved that he, in fact, knew nothing of the great 
change which had been made in the objects of the com- 
pany (?). 
Webster's case. In Webster's case (/.'), which was another in the same com- 
pany, the allottee had exchanged the banker's receipt for a 
certificate that he was the proprietor of fifteen shares " subject 
to the provisions of the memorandum and articles of associa- 
tion : " but even this and the lapse of one year after the allot- 
ment, and ten months after the receipt, were held not to 
deprive him of his right to be removed. 

Nichols' case (1). A prospectus of a projected company 
stated (in effect) that its objects were to rear poultry, and to 
enable consumers to buy eggs and poultry at half the usual 
price. The prospectus stated that the articles of association 
might be seen at the company's office ; but neither the pro- 
spectus nor the articles referred to the memorandum of asso- 

Niehols' case. 

(/) See the judgments in PecVs 
case, 2 Ch. 674 ; Lawrences case and 
Kincaid's case, ib. 412 ; Wilkinson's 
case, ib. 536 ; also in Dowries v. Ship, 
L. E, 3 H. L. 343, and Oakes v. Tiu- 
quand, 2 ib. 325. 

(g) Compare with the cases re- 
ferred to in the next notes, P< i Vs 
c«?>', 2 CI;. 674 ; Hare's case, 4 Ch. 


(/;) 1 Ch. 574, ante, p. 21. See also 
TFijnn's case, 8 Ch. 1002, and Beck's 
case, 9 ib. 392. 

(?') Compare Ex parte Briggs, 1 Eij. 
483. • 

(/.■) 2 Eq. 741. 

(/) W. N. 1807, 77. 


ciation. On the faith of tliis prospectus, application was made I5k - {- r,ll i'- ] - 

' 2. 

by Nichols for shares, and tiny were allotted to him. Shortly - 
afterwards the company was registered, and by its memo- 
randum of association its objects were stated, to be not only 
to rear poultry and deal in poultry and eggs, but also " the 
dealing in game and wild birds, the cultivation and growth of 
vegetables, fruit, and agricultural produce, the acquisition, 
use, or sale of inventions for artificial hatching, the preserva- 
tion of poultry or meat, and any other purpose connected with 
the business of the company, and the carrying on the busi- 
nesses of poulterers, egg merchants, dealers, market gardeners, 
and farmers." Nichols took no part in the proceedings of the 
company, and did nothing whatever except pay for the shares 
on allotment. A year after the allotment he, for the first 
time, became acquainted with the objects of the company as 
formed, and he at once repudiated his shares. The 
V.-C. Wood removed his name from the register of share- 
holders, being of opinion that there was nothing to put 
Nichols on inquiry, and that under those circumstances the 
time which had elapsed since the allotment of shares was 

In Bailys case (m), a person applied for shares, and paid the Baily's case, 
deposit on them ; the company was afterwards registered, and 
it issued another prospectus, materially differing from the first ; 
the shares were then allotted, but this was some months after 
the application for them; the allottee declined to accept them, 
and asked for his money back ; nothing further was done for 
eighteen months, when a call was made upon him ; he then 
applied to have his name struck off the register of share- 
holders, and it was ordered to be struck off. This case is 
instructive, not only on the effect of delay after repudiation (»)> 
but as showing, that even although the memorandum of asso- 
ciation and the prospectus may not vary, still a material 
departure by the company from the prospectus on the faith of 
which shares are applied for, entitles the applicant to decline 
to accept them. 

(m) Ex parte Bailij, 3 Ch. 592, 503, where the company was being 
and 5 E<|. 428. wound up. 

(n) Compare Hare's case, 4 Ch. 


Bk. I. Chap. 1. On the other hand, where a person knowing the change of 

the objects of the company delays to repudiate his shares, he 

] ate> will be treated as electing to hold them, and any subsequent 

attempt to repudiate them will be unsuccessful ; and a delay of 
four months has been held fatal, even although during that 
time the shareholder had done nothing which was inconsistent 
with his repudiation (o). But the onus of proving such know- 
ledge is on the persons who made the misrepresentation, and 
proof by them that a letter containing a notice of the misrepre- 
sentation was sent to the registered address of the person 
seeking to repudiate his shares is not sufficient to fix him with 
notice of the misrepresentation, if in fact he had no knowledge 
of the letter (p). It need hardly be observed, that if after 
knowledge of the facts entitling a person to repudiate his 
shares he acts as a shareholder, e.g., by attending meetings, 
paying calls, or attempting to sell his shares, his right to repu- 
diate them will be at an end (q). Further, if a shareholder 
knowing of one ground of variance, or having his suspicions 
aroused, chooses to remain quiet, it will be too late for him 
afterwards to repudiate his shares, and he will be a contribu- 
tory (;•)• So will delay be fatal after the right of the share- 
holder to repudiate his shares is denied (s). 
Application for In all the foregoing cases it will have been observed that the 
company is™ application for shares preceded the formation of the company. 
formed. Where a company is actually formed, and a person afterwards 

applies for shares in it, and they are allotted to him, an agree- 
ment between him and the company is thereby concluded, and 
in the absence of fraud is binding on both parties. In such a 
case a definite thing is applied for, viz., a share in an existing 
compan} T , the objects of which are defined by the Company's 
act of Parliament or memorandum of association, with which 
he can make himself acquainted ; the thing applied for is 
acquired ; the contract, therefore, is complete and can only be 
impeached, if at all, for fraud (t). 

(o) Lawrence's case, 2 Ch. 412 ; (</) See Ex parte Briggs, 1 Eq. 

Kincaid's case, ib. See, also, Wil- 483. " 

kinson's case, 2 Ch. 536. (r) JVhitchouse's case, 3 Eq. 790. 

(p) In re London and Staffordshire (s) Taite's case, 3 Eq. 795. 

Fire Insurance Co., 24 Ch. D. 149. (t) See Lord Cairns' judgment in 


The subject of fraudulent prospectuses will be referred to Bk. I. chap. i. 
hereafter (see Book I., c. 8). — — - 


Before leaving the subject discussed in the foregoing pages, 
it will be convenient to consider the circumstances under which 
an allottee of shares, who has paid a deposit upon them, has a 
right to have this deposit returned, upon the ground that the 
consideration for its payment has failed. His right to be 
relieved on the ground of fraud will be considered hereafter. 

It has been decided by the House of Lords, that if a number Subscriber to a 
of persons, meaning to join in a common undertaking, raise a uSyto retire 
common fund, eventually to be increased, but commencing by from Lt 
a deposit, and they put these deposits for a common object 
into the hands of a committee, with directions to them to do 
certain acts, it is not competent for any one or more of the 
subscribers against the will of the others to withdraw and say, 
" I think, or we think, you ought not to go any further." Any 
one subscriber who is not of that opinion has a right to say, 
" I gave my money upon the faith that we all embarked in 
one common undertaking, and till that has been done, which 
we agreed should be done, none have a right to withdraw and 
say you shall not go any further" (u). It follows from this, 
that no subscriber to a projected company can recover back his 
money on the ground that the consideration for his subscrip- 
tion has failed, until the formation of the company upon the 

Peel's case, 2 Ch. 684, and the judg- H. L. C. 497; compare Kent v. 

merits in Kisch v. Central Railway Jackson, 14 Beav. 367, and 2 De G. 

of Venezuela, 3 De G. J. & S. 122, Mac. & G. 49. As to' the right of 

and L. R. 2 H. L. 99; Oakes v. scrip holders to have the money 

Turauand, ib. 325 ; and see as to subscribed by them applied to the 

the immateriality of altering the purposes for which they subscribed 

articles of association, Lyon's case, it, see Bagshaw v. The Eastern Union 

35 Beav. 646. Bail. Co., 7 Hare, 114, and 2 Mac. 

(u) Baird v. Ross, 2 Macqueen, & G. 389. 
61. See, too, Barnes v. Pennell, 2 



Bk. I. Chap. 1. 
Sect. 3. 

Unless it has 

1. Subscribers 
to abortive com- 
panies not liable 
for expenses 
incurred in 
attempting to 
form them. 

Nockells v. 

terms assented to by him (r) lias been abandoned or has 
become impracticable. 

But further, 'when a person applies for shares and has them 
allotted to him, a contract is entered into between him and 
others, and before any question as to failure of consideration 
can be discussed, the terms of this contract must be examined 
for the purpose of ascertaining precisely for what the deposit 
was paid (y). If the contract shows that the deposit was paid 
for a share in a company to be formed for certain purposes and 
upon certain conditions and no such company is formed, and 
the time for its formation (which, if no time is limited, must be 
taken to be a reasonable time) has elapsed, then the considera- 
tion for which the deposit was paid has failed, and the deposit 
is returnable, unless the original contract has been varied with 
the consent of the subscriber of the deposit. But if the con- 
tract shows that the deposit was made for some other purpose 
(e.g. for the purpose of being employed in attempting to start 
the company), then the circumstance that the company has 
not been and cannot be formed, is no reason why the deposit 
should be returned. 

The leading case in support of the first of these propositions 
is Nockells v. Crosby (z). There the defendants, in circulars 
published by them, had proposed to receive subscriptions of 10s. 
a week for the space of one year, and to invest these subscrip- 
tions and to divide the interest twice a year equally amongst the 
subscribers or the survivors of them. The plaintiff subscribed 
to this scheme, but there not being a sufficient number of 
other subscribers nothing was ever invested, and the defendants 
came to a resolution to proceed with it no further, and to 
return to each subscriber the amount of his subscription, less a 
per-centage for expenses incurred. The plaintiff demanded to 

(x) See Johnson v. Goslett, 18 C. 
B. 728, and 3 C. B. N. S. 5G9, and 
see also Wilson v. Church, 13 Ch. 
D. 1, and S. C. under the name of 
National Bolivian Navigation Co. v. 
JFilson, 5 App. Ca. 17(5. 

(y) Hence in an action for the 
recovery hack of the deposit, the 
letter allotting the shares in respect 

of which the deposit was paid, must 
be produced, Clarke v. Chaplin, 1 
Ex. 26. The defendants will, if ne- 
cessary, be ordered to produce the 
agreement hetween them and the 
plaintiff, Hteadman v. Arden, 15 M. 
& W". 587. 

{z) 3 B. & C. 814. 


have the whole amount subscribed by him returned, and he l; - t. Chap. 1. 

• Becfc - '■'■ 

brought an action against the defendants for its recovery and 

was held entitled to a verdict. He had subscribed his money 
for one purpose only; it had not been applied, nor was there 

any longer any intention to apply it for that purpose, and it 
was therefore the duty of the defendants to return it to him in 
full. The judgment of Littlcdale, J., upon the right of pro- 
moters of abortive schemes to charge the subscribers with 
expenses is particularly valuable, and was as follows : — 

"I also am of opinion that the plaintiff is entitled to recover, upon tlii- 
general principle, that it' persons set a scheme afoot, ami assume to be the 

directors or managers, all the expenses incurred before the scheme is in 
actual operation, must in the first instance he home by them. When it is 
in operation, the expenses and charge of management should he borne by 
the concern, and then it may be fair that the preliminary expenses should be 
paid in the same way, for then the subscribers have the benefit of them. 
The prospectus put forth by thesu defendants stated that the money 
subscribed was to be placed out at interest. The plaintiff's sole object in 
paying the money must have been to have it so placed out, but during 
eighteen months it remained idle at the bankers. Suppose there had 
been no subscribers, the projectors must have paid all the expenses. 
If, then, one person only subscribes, are all those expenses to be cast upon 
him ? The hardship and injustice would be monstrous, yet that would be 
the consequence in such a case were we now to hold that the plaintiff was 
liable to a proportion of the expenses incurred by these defendants. With 
respect to the supposed partnership, it is plain that there could be none 
until the money was laid out in execution of the proposed scheme. I am, 
therefore, clearly of opinion that the plaintiff was entitled to recover." 

This case has been constantly recognised and followed (a) . 0ther cases - 
The principle applies, whatever the object of the company 
when established may be ; and to companies formed on the 
cost-book system as well as to the others (b). Moreover, if an 
allottee of shares undertakes to sign some deed which is 
referred to, and that deed is not in existence ; but a deed, said 
to be the one referred to, is afterwards prepared, he is not 

(a) See Walstab v. S})Ottisivoode, (b) Johnson v. Goslett, 18 C. B. 

15 M. & W. 501 ; Moore v. Garwood, 728, and 3 C. B. N. S. 569. In this 

4 Ex. 681 ; Ashpitel v. Sercombe, f> case the company was actually at 

Ex. 147 ; C'oupland v. Challis, 2 Ex. work, and its formation had never 

682; Owen v. Challis, 6 C. B. 115; been abandoned. But its formation, 

Ward v. Londesborovgh, 12 C. B. on the terms originally agreed upon 

252 ; Mowatt v. Londesborouyh, 3 E. was abandoned, and the plaintiff had 

& B. 307, and 4 ib. 1. not assented to any others. 



Bk. I. Chap. l. bound to execute that, if it is inconsistent with the contract 

Sect. 3. ' 

— into which he has already entered. Consequently, where a 
person applied for shares in a projected railway and paid his 
deposits, and undertook to sign the parliamentary contract and 
subscribers' agreement, and a deed was afterwards prepared 
authorising the promoters of the company to apply the deposits 
in defraying preliminary expenses, it was held, that this was 
not such a deed as it was obligatory upon the allottee to 
execute, and that, the company having proved abortive, he was 
entitled to recover his deposits although it would have been 
otherwise had he executed the deed (<■). 

No lien for Even where, upon the foregoing principles, a subscriber is 

entitled to have his deposit returned he has no lien for it and 
cannot restrain other creditors from attaching it (d). 

Calls on sub- It need hardly be observed that, if a person has agreed to 

SCribers to ... „ ln .... 

abortive com- pay a deposit in respect of certain shares, and the consideration 

varies. £ or j^g agreement has failed, he is not compellable to pay the 

deposit (e). But if a person undertakes to pay deposits by a 

certain day, it is no defence to an action for not paying them 

on or before that day, that since that day the projected compan\ r 

has become abortive ; for, perhaps, that would not have been 

its fate if the subscriptions had been paid as promised, and ex 

hypothesi, the promise was broken before the circumstances 

relied on as an excuse for its breach occurred (/). 

2. Deposits not In the cases referred to above, the deposits were held return- 

pS'to^ver' 611 aDle u P on tne ground that they had been paid for one purpose 

preliminary onlv, and that such purpose had become unattainable. In 


those about to be referred to, the deposits were held not return- 
able, although the company subscribed to had proved abortive ; 
for the contract of the parties showed that the deposits were 
properly applicable in discharge of the expenses incidental to 
the attempt to form the company (g). 

(c) Ashpitel v. Scrcombe, 5 Ex. 7 E. & B. 164, and on appeal, 2 E 
147. & E. 398 ; see IVoolmer v. Toby, 10 

(d) Moseley v. Cresscy's Co., 1 Eq. Q. B. 691, as to "who ought to sue in 
405. such cases. 

(e) Duke v. Andrews, 2 Ex. 290. (g) See Baird v. Boss, 2 :,1 'Queen, 
(/) Duke v. Vice, 1 Ex. 36 ; Duke 63, 69. 

v. Forbes, ib. 356 ; Aldham v. Broun, 


Garwood v. Ede (//) is a case of this description. There the 1;k - !• Chap. i. 

plaintiff had paid deposits on shares in a projected railway, and - — 

*• Garwood r. Ede. 

liad signed a deed which authorised the promoters to defray 

the expenses incidental to the undertaking out of the deposits 

paid for shares (i). Under these circumstances it was held 

that, although the scheme for the railway proved abortive, the 

deposits paid by the subscribers for shares in it were not 


Clements v. Todd (k) was decided on the same principle ; for Clements v. 

K Eodd. 

although the plaintiff had not signed any such deed as that 

signed in the last case, there was a deed which he had under- 
taken to sign, and he had accepted scrip certificates which 
stated that he had signed it. lie was therefore held to have 
authorised the application of his deposits in the discharge of 
preliminary expenses, as mentioned in the deed. 

Jones v. Harrison (I) is another instance of the same kind, £> nei ! v - 

Harris a\. 

only the authority to defray preliminary expenses out of the 
deposits was conferred by the terms of the letter of allotment, 
and not by any deed intended for execution after the allotment 
was made. 

Upon precisely the same principle it was held in the more Aldham v. 
recent case of Aldham v. Brown (m), that where a person had 
covenanted to pay a deposit which was to be applicable, amongst 
other things, to the discharge of the expenses of forming a com- 
pany, he was bound by his covenant, and was liable to an action 
upon it, although, before the action was brought, the formation 
of the company had become impossible. 

The cases of Garwood v. Edc(n), and Watts v. Salter (o), Cases in which 

. . . deposits have 

which decided that a person who had paid deposits and been held 
executed a deed authorising their application in payment of^["™ h ^ e 

company's deed 

. (h) 1 Ex. 264 ; see, too, Watts v. Edgivorth, 2 De G. & Sin. 73. has bee " S ' gned " 

Salter, 10 C. B. 477 ; Vane v. Cob- (I) 2 Ex. 52; see, too, Willey v. 

bold, 1 Ex. 798 ; Atkinson v. Pococl; Parratt, 3 Ex. 211 ; Baird v. Ross, 

ib. 79G. 2 M'Queen, 61. 

(i) Meaning the preliminary ex- (m) 7 E. & B. 164, and 2 E. & E. 

penses. See Willey v. Parratt, 3 398 ; see, too, Duke v. Dive, 1 Ex. 

Ex. 211 ; Baird v. Boss, 2 M'Queen, 36 ; Duke v. Forbes, ib. 356. 

69. (to) 1 Ex. 264. 

(k) 1 Ex. 268 ; compare Ashpitel (o) 10 C. B. 477. 
v. Sercombe, 5 Ex. 147; Sibson v. 

L.C. I> 



Bk. I. Chap. 1. 
Sect. 3. 

Evidence in 
actions for the 
recovery back 
of deposits. 

Evidence of the 
receipt of the 
money by the 

preliminary expenses, could not recover the deposits so paid, 
are not to be regarded as authorities for the proposition that 
the execution of such a deed necessarily, and under all circum- 
stances, precludes the recovery back of the deposits. If the 
execution of the deed has been induced by fraud, the right to 
recover the deposits is unaffected by such execution (p) ; and 
although it was said in Watts v. Salter that in the absence of 
fraud, the deed, and that alone, regulated the rights of the con- 
tracting parties, yet this doctrine has not altogether met with 
approbation : and in a later case, where the promoters of a 
railway company had in their circulars and letters of allotment 
expressly undertaken to return the deposits in full, if the 
necessary act of Parliament could not be obtained, it was held, 
first by the Court of Queen's Bench, and afterwards by the 
Exchequer Chamber, that the deposits paid were recoverable 
in full, even by persons who had executed a deed whereby it 
was expressly stipulated that the promoters should be indem- 
nified out of the funds of the compan}*- and by the subscribing 
shareholders against all expenses (q). The promoters, in order 
to induce persons to take shares, to pay deposits, and execute 
the deed, promised to return all deposits in full in a given 
event : and it could never have been intended that a person by 
executing the deed should lose the benefit of that promise. 

Before leaving this subject, it may be as well to observe that 
in order that an action for the recovery back of deposits may 
be successful, the plaintiff must prove that the money he seeks 
to recover was paid to the defendants or to their agents. For, 
in the absence of such proof, however clear the right of the 
plaintiff may be to have his money back, he will have estab- 
lished no case against the individual from whom he seeks to 
recover it. 

In Nockells v. Croshy, Walstab v. Spottisicoode, and the cases 
of that class already referred to (p. 30, et seq.), the plaintiff 

(}?) Wontner v. Shairp, 4 C. B. 

404 ; Jarrett v. Kennedy, 6 C. B. 
319 ; compare Vane v. Cobhold, 1 
Ex. 798; and Atkinson v. Pococlc, 
ib. 796 ; Watts v. Salter, 10 C. B. 

(q) Mowatt v. Lord Londesborough, 
3 E. & B. 307, and 4 ib. 1. In this 
case interest on the deposit had 
been demanded, and was recovered, 
from the time of the demand. 



proved that lie had paid his deposit's to the bankers appointed by 1;k - i;^ 1 '?, 1 '' 

the defendants to receive them, and this was quite sufficient (r). 

But it must he borne in mind that the promoters of companies are 

not partners (s), and that in order that any particular promoter 

may be liable to return deposits paid into a hank to the account 

of the company, it must be shown that he authorised the bank 

to receive the deposits on the account to which they have been 


Thus in Watson v. The Earl of Charlemont (t), the plaintiff J** 8 ?* <■ 

J . Charleinont. 

brought an action against three persons to recover deposits 
paid by him for shares in an abortive company. The three 
defendants were members of the committee of management. 
The letter of allotment sent to the plaintiff was signed by the 
secretary to the company, and contained a list of banks into 
any of which deposits might be paid. The plaintiff had paid 
his deposits into one of these banks, and had received from 
the bankers a receipt on account of certain persons as trustees 
for the company. Only one of the defendants was amongst the 
persons on whose account the receipt of the money was thus 
acknowledged ; and it was held that this evidence was insuffi- 
cient to show a receipt by all the defendants, and the action 
therefore failed. 

(?•) See, too, Hayes v. Stirling, 14 infra, book ii. c. I, sec. 1. 
Ir. Com. Law Rep. 277 ; Maitland's (f) 12 Q. B. 856. See, also, Bum- 
case, 4 De G. M. & G. 769. side v. Dayrell, 3 Ex. 224 ; Drouett 

(s) See Partnership, p. 23, and v. Taylor, 16 C. B. 671. 

D 2 





Bk. I. Chap. 2. Every person who is capable of contracting is capable of 

' becoming a member of a company (a). A company may no 

doubt be formed on terms which expressly exclude certain 
persons or classes of persons from becoming members of it ; 
but regulations to this effect do not affect the legal capacity of 
the persons excluded. Such capacity depends on the general 
law of the country, not on the regulations of any particular 
compairy. But notwithstanding the general proposition above 
stated, a few observations are necessary with reference to 
1. Aliens; 2. Convicts; 3. Infants; 4. Lunatics; 5. Married 
women ; and 6. Corporations and companies. 

1. Aliens. 

Alien friends. There is nothing to prevent an alien, not an enemy, from 

holding shares in a company (b). But a public minister of a 
foreign state, accredited to and received by the Queen, cannot 
be sued here even in respect of commercial transactions in 
which he may have engaged ; and if, therefore, such a person 
holds a share in a company, he cannot, while so accredited 
and received, be sued here, either for calls or in respect of the 
debts and liabilities of the company (c). 

(a) Partn. 71 ; as to the clergy, see B. v. Arnand, 9 Q. B. 806 ; and 17 
1 & 2 Vict. c. 106, §§ 29-31, and 4 & 18 Vict. c. 104, § 18. See, geue- 
Vict. c. 14. rally, as to aliens, 33 Vict. c. 14. 

(b) A ship may be registered in (c) Magdalena Steam Nav. Co. v. 
the name of a company, although Martin, 2 E. & E. 94. 

some of its members are foreigners. 


Alien enemies stand in a very different position from alien 1;| <. I. Chap. 2. 
friends. for when two supreme powers are at war all persons, 
who for the time being arc the subjects of either, become, in' 
contemplation of the civil tribunals of both, hostile to the 
subjects of the other; and so long as the war lasts, the subj' 
for the time being of the one country are incapable of entering 
into any valid contract with the subjects of the other; and all 
remedies available for the one against the other in respect of 
transactions before the war are suspended (d). Consequently 
while war lasts an agreement by an alien enemy to become a 
member of an English company cannot be enforced. The 
effect of a person who is a member of a company becoming an 
alien enemy by a declaration of war has never been decided; 
but Ex parte Boussmaker (e) tends to show that such a person 
woidd not ipso facto cease to be a member : but rather that his 
lights and liabilities would be suspended during the war, and 
might be enforced upon the restoration of peace (/). 

It is to be remembered that whether a person is or is not to 
be considered as an enemy depends, not on whether there is 
war between this country and his native land, but upon 
whether there is war between this country and the country in 
which he is voluntarily resident (g). A foreigner resident in 
this country and holding shares in an English company would 
not therefore be affected as regards his shares by a war be- 
tween this country and his own (//). 

With reference to the legality of trade and commerce, a com- Residence of 
pan}* ought, it is conceived, to be treated as resident not only 
where its principal place of business is, but wherever it has 
any place of business (i). It has, however, been determined, 

(d) Albrecht v. Sussman, 2 Y. & (;/) Albrecht v. Sussman, 2 Yes. & 
B. 323; JVillison v. Patteson, 7 B. 323; Willison v. Patteson, 7 
Taunt. 440; Ex parte BoussmaJcer, Taunt. 440; Houriet v. Morris, 3 
13 Yes. 71 ; Putts v. Bell, 8 T. R. Camp. 303 ; Bell v. Reid, 1 M. & S. 
548. See the note to Ckmontson v. 726. 

BUssig, 11 Ex. 141. (/*) See Wells v. Williams, 1 L. 

(e) 13 Yes. 71. Raym. 2X2 ; 1 Salk. 46; and the 
(/) Subject to being barred by cases in the last note. 

the Statute of Limitations. Whether (?) See Carron Co. v. Maclaren, 5 

peace operates retrospectively, see II. L. C. 416, and Lewis v. Baldwin, 

New York Life Ins. Co. v. Statham, 11 Beav. 153, from which it appears 

3 Otto, 24 (Amer.). that for some purposes at all events 



Bk - *• Ch *v- 2 - that for the purpose of deciding whether a company dwells 

within a particular district, regard ought to be had rather to 

the place where its business is principally carried on than to 
the situation of its subordinate offices (k). 

A registered company does not necessarily dwell where its 
registered office is situate (I). 

A note on the subject of foreign companies will be found in 
the Appendix. 

2. Convicts. 

The old law by which the property of felons was forfeited to 
the Crown was abolished by 33 & 34 Vict. c. 23 (m). The 
Crown, however, is empowered to commit the custody and 
management of the propert}- of an} r convict (i.e. a person sen- 
tenced to death or penal servitude) (§ 6) to an administrator (§ 9) 
in whom all the convict's property then becomes vested (§ 10), 
and who can dispose of the same as he may think fit (§ 12). 
A convict cannot alienate any of his propert}- nor make any 
contracts, nor maintain any action for the recovery of any 
property, debt, or damage (§8), except when lawfully at large 
under a proper license (§ 30). Provision is also made for the 
appointment by a justice of the peace of an interim curator of 
a convict's property (§ 21). 

Position of the There have not as yet been any decisions on the application 
administrator. „ .. . -.i-i-i-it -^ 

ot this act to convict shareholders. But several important 

questions are suggested by it : e.g. Is the administrator, him- 
self a shareholder, liable to pay calls and to be a contributory 
in the event of the company being wound up ? or is he entitled 
to sell and transfer the convict's shares without becoming a 
shareholder himself ? Sect. 10 is so worded that it may pos- 
sibly be held to make the administrator a shareholder simply 
by virtue of his office ; but when the section is applied to the 

companies may be considered as resi- 404 ; Taylor v. Crouiand Gas Co., 1 1 

dent in more places than one. Ex. 1. 

(/;) See Jones v. Scottish Accident (I) Cesena Sulphur Co. v. Nichol- 

Insurance Co., 17 Q. B. D. 421 ; son, 1 Ex. D. 428 ; Calcutta Jute 

Brown v. Lond. and X. W. Bail. Co., Mills Co. v. Nicholson, ib. ; Keyn- 

4 B. & Sni. 326 ; Shield v. Great X. sham Blue Lias Co. v. Barker, 2 H. & 

Bail. Co., 7 Jur. N. S. 6:32 ; Adams C. 729. 

v. .Great W. Rail. Co., 6 H. & N. (m) Partn. 73. 



shares of any particular company, the company's act, charter, l;k - \- Ch; ')'- '-'■ 

Sect. 1. 

or regulations may enable the administrator to dispose of the 
shares vested in him without himself becoming a shareholder, 
and incurring personal liability as such (see also § 12). 

:!. Infants. 

An infant may be a member of a company, but he can 
repudiate his shares whilst he is an infant or on coining of 
age (in. 

An infant, however, cannot hold shares and decline to pay 
the calls in respect of them. He may, if he chooses, repudiate 
his shares and so get rid of his liabilities (o) ; but if he does 
not repudiate the shares, he must pay calls like any other 
shareholder (p). Qui sentit commodum sentire debit at onus. 

If a company's memorandum of association is signed by an 
infant, his signature is by no means inoperative. The incor- 
poration of the company is not affected by it : and he becomes 
a member until he repudiates his share (q). 

An infant who has had shares in a company transferred to 
him, ma} r be rejected as a shareholder by the company on 
ascertaining the fact of his infancy (/•) ; but the transfer is 
voidable only and not void, and unless repudiated by the com- 
pany or the infant will be held good (s). 

The Infants' relief act, 1874 (t), which renders invalid pro- 

(/<) Co. Lit. 38U6 ; Dublin and 
Wicklow Rail. Co. v. Black, 8 Ex. 
181 ; and see Mitchell's case, 9 Eq. 
363 ; and EbbeWs case, 5 Ch. 302, 
and others of that class. If a com- 
pany is being wound up and is in- 
solvent, of course it will he for the 
benefit of an infant shareholder to 
repudiate his shares, and so avoid 
being made a contributory. See 
Reid's case, 24 Beav. 318 ; and infra, 
book iv., under the head Contri- 

(o) Load, and N. W. Hail. Co. v. 
McMichael, 5 Ex. 114 ; Newry and 
Ennishillen Rail. Co. v. Coombe, 3 
Ex. •"><;.">. and tin- cases referred In in 

book iv., under the head Contri- 

(p) See Cork and Bandon Rail. Co. 
v. Cazenove, 10 Q. B. 935 ; Leeds and 
Thirsk Rail. Co. v. Feamleij, 4 Ex. 
26 ; North West Rail. Co. v. Mc- 
Michael, 5 Ex. 114. The Birkenhead, 
Lancashire, &c, Rail. Co. v. Pitcher, 
5 Ex. 24, is not opposed to these ; 
see S. C. ib. 121. 

(q) See Nassau Phosphate Co., 2 
Ch. D. 610. 

(r) See Sijmoii's case, 5 Ch. 298, 
and infra, in book iv. 

(s) Lumsden's case, 4 Ch. 31. 

(t) 37 & 38 Vict. c. CrJ. 


Bk. I. Chap. 2. mises made by persons of age to pay debts contracted during 
— their minority, does not apparently affect the position of persons 
who become shareholders before they are twenty-one, and 
retain their shares after they come of age. 

The position of infant shareholders on the winding up of 
companies will be alluded to hereafter when treating of con- 
tributor} es. 

4. Lunatics. 

Although contracts with lunatics are not necessarily void, 
and lunatics not known so to be may become liable in damages 
for goods supplied to them (it), yet a lunatic cannot be com- 
pelled specifically to perform a contract, nor can he obtain a 
judgment for specific performance against other people (x). 
But a lunatic ma} r become a shareholder without his insanity 
being known ; and if he does he cannot repudiate his shares (y) ; 
whence it follows that he is entitled to dividends, and is liable 
to calls in respect of them. 

A lunatic who is so found by inquisition, and whose property 
is under the care of a duly appointed committee, is not in a 
position to bind himself by contracts or to deal with his own 
property. Shares belonging to him remain his, and he is liable 
to calls and to be a contributory in respect of them ; but his 
rights in respect of them can only be exercised by his 

By the Lunacy regulation act (16 & 17 Vict. c. 70) {z), the 
committee can sell and transfer them without himself becoming 
a member in respect of them ; and this power is usually exer- 
cised if the holder of them is under airy liability to have calls 
made upon him. 

By the Trustee act, 1S50 (13 & 14 Vict. c. GO, § 5), shares 
standing in the name of a lunatic trustee may be transferred 
by a person appointed by the Lord Chancellor for the purpose. 

(u) See Drew v. Nunn, 4 Q. B. D. [y) See Moulton v. Gamroux, 2 Ex. 

661 ; Baxter v. Earl of Portsmouth, 487; and 4 ib. 17 ; Beavan v. Mc- 

5 B. & C. 170. As to lunatics so Donndl, 9 ib. 309 ; and 10 ib. 184. 
found, see Snook v. Watts, 11 Bear. (.-.) See §§ 2, 116, 120 123, 140- 

107. 144. 

(.;) See Fry on Spec. Perf. 

[ED women. 41 

5. Married iromen. 

Bk. I. Chap. 2. 

Sect. 1. 

As regards married women, it is necessary in the first place 
to distinguish those who have separate estate from those who 
have none. 

A married woman without separate estate cannot, except in No separate 
a few cases (a), contract as a principal. She cannot be com- w 
polled to take shares which she may have applied for; nor can 
she be compelled to pay for them. Nor, apart from statute, 
is she liable to pay any calls in respect of any shares which 
may have been in fact allotted to her and are standing in her 
name (/>). Whether her husband is a shareholder or is liable 
to calls in respect of such shares depends on the nature of the 
company. But if, as often happens, he cannot be regarded as 
a member of the company consistently with its regulations or 
with the statutes by which it is governed, he will not be liable 
in respect of them (c). 

A married woman having separate estate which she is not Separate estate. 
restrained from anticipating is, as to such estate, in the posi- 
tion of a feme sole (d). She can invest it in shares, and make 
herself liable to pay for them and to pay calls upon them to 
the extent of such separate estate (<?) ; and on the winding up 
of the company she will be a contributory in respect of her 
shares to the like extent (/). Her husband is not liable in 
respect of such shares (g). 

A married woman entitled to fully paid-up shares for her 

(a) Viz. 1, When her husband is and as to his non-liability to sci.fa., 

a convicted felon; 2, when he is Ness v. -Angas, 3 Ex. 805; Dodgson 

judicially separated from her ; 3, v. Bell, 5 ib. 967. 
when she has obtained a protection (d) 45 & 46 Vict. c. 75, § 1. 

order against him ; 4, when he is an (e) lb. 

alien enemy abroad; 5, when the (/) lb., §§ 6 & 7; and see 

wife is trader in the city of London. Matthewman's case, 3 Eq. 781 ; Bond. 

See Partn. 77. and Bombay Bank, 18 Ch. D. 581. 

(6) But see 45 & 46 Vict. c. 75, §§ (g) See 45 «fe 46 Vict. c. 75, §§ 1, 

6 & 7, referred to below. 6, 7 ; as to shares standing in her 

(c ) See as to his non-liability to name before marriage, see infra ; 

be made a contributory, Angus' Luard's case, 1 De G. F. & J. 533, 

case, 1 De G. & Sm. 560 ; Ex parte seems no longer law except as re- 

Bhodes, 7 W. R. 510. Compare gards such shares. 
Luard's case, 1 De G. F. & J, 533 ; 


Bk. I. Chap. 2. separate use can compel the company to register them in her 

Sect. 1. 

name (It) ; but she cannot do so if the holding of the shares 
involves liabilit} T , and there is anything in the company's act or 
regulations which entitles the company to decline to accept 
her as a shareholder (i). 

By the Married woman's property act, 1882, shares standing 
in the sole name of a married woman are deemed to belong to 
her for her separate use unless the contrary be proved (k). 

Feme sole share- If a feme sole is a shareholder and marries, the law now is 
ryi that the shares are her separate estate and, subject to a quali- 
fication, to be mentioned presently, she is alone liable in 
respect of them (/). Formerly, both she and her husband 
were liable (m) ; and even now he is liable to calls made on his 
wife's shares, whether before or after the marriage, if he has 
in fact obtained by the marriage property of his wife to the 
value of such calls (n). Further, in the event of the company 
being wound up and his wife becoming a contributory, he is 
liable to be put on the list himself (o). His liability to calls 
is confined to the continuance of the marriage (p), but not to 
the amount of the property acquired from his wife ((f). 

The Married woman's property act, 1882, § 17, enables the 
husband or the wife or the company to obtain a decision as to 
his or her title to shares, by summons or otherwise, in a 
summary way, before a judge of the High Court (p). 

Date of marriage. It is necessary to mention that the date of marriage is some- 
times material ; but on this point it is sufficient to refer the 
reader to the Married woman's property act, 1882 (45 & 46 
Vict. c. 75). 

(h) lb., §§ G, 7; B. y. Carnatic Ex parte Hatcher, 12 Ch. D. 284. 

Rail. Co., L. R. 8 Q. B. 29!). (u) 45 & 46 Vict. c. 75, § 14. 

(i) lb., § 7. (o) Companies act, 1862, § 78 ; 

(&) II)., §§ 6 & 7. Ex parte Hatcher, 12 Ch. D. 284 ; 

(I) 45 & 46 Vict. c. 75, §§ 6 & 13. see also Bell's case, 4 App. Cas. 550. 

(m) See LuaroVs case, 1 De G. F. & ( p) See the section. 

J. 533 ; Burlinsons case, 3 De G. & (q) See Ex parte Hatcher, 12 Ch. 

Sm. 18 ; Sadler's case, ib. 36; Khlut's D. 284 ; decided on the Married 

case, ib. 210 ; White's case, ib. 157 ; woman's property act, 1874. 


Bk. I. Chap. 2. 
G. Colorations and Companies. - 

There is no general principle of law which prevents a corpo- Corporations, 
ration from holding shares in a company except the principle partners! 
that a corporation cannot lawfully employ its funds for pur- 
poses not authorised by its constitution. It has hecn assumed 
by the legislature, in many of the statutes relating to com- 
panies, that corporations may lawfully be shareholders (r), 
and at common law one corporation may be a member of 
another (s). Accordingly it has been held that where the 
above principle does not apply one company may hold shares 
in another (/) ; although not in a benefit building society (m). 
Practically, however, it may be said to be prima facie ultra 
vires for one company to hold shares in another : i.e., power 
so to do must be shown to be expressly or impliedly given 
to it (x). 

Generally speaking, some condition has to be performed, Who are mem - 

r i«i i i t , f l' crs °f con '- 

sonie formality to be observed, before a person entitled to ranks. 
become a member actually becomes one, and before a person 
entitled to retire actually ceases to be a member. What these 
conditions or formalities are in any particular case can only be 
ascertained by examining the act of Parliament, charter, deed 

(r) See for example the Com- surer of a friendly society, Ex parte 

parries' act, 1862, § 23, and the Swansea Friendly Society, 11 Ch. D. 

interpretation put on it in the cases 768. 

cited in note (t) ; the Industrial (..■) See Great W. Rail. Co. v. 

and Prov. Soc act, 39 & 40 Vict. c. Metrop. Rail. Co., 9 Jur. N. S. 562 ; 

45, § 12(4); 7 Wm. IV. and 1 Ex parte Contract Corp., 3 Ch. 105; 

Vict. c. 73, §§6& 10; 7 & 8 Vict. c. Ex parte British Nation, dbj ri Ass.', 

110, §§ 3 & 7, (8), and § 50. 8 Ch. 1). 679, where it was held' 

(••>■) Grant on Corporations, p. 5. that a society to which shares in 

(t) Ex parte Contract Corp., 3 Ch. another society had been transferred 

105 ; Royal Bank of India's case, 4 by an act ultra vires, could not be 

Ch. 252, and 7 E.p 91. placed on the list of contributories 

(u) Dobinson v. Hawks, 16 Sim. of that society. 
407. A corporation cannot be trea- 



Bk - g e( J h< 2 P ' 2 ' or °^ ier instrument by which the company is governed ; and 
care therefore must be taken in applying decided cases to 

attend to the constitutions of the companies to which they 

relate (y). 
Necessity of N person can, properly speaking, be said to be a member 

observing '*■!■•/* 

formalities. of or shareholder in a company so long as he has only a right 
to become such ; nor "can a person who has become a member 
or a shareholder be properly said to have ceased to be one so 
long as he has only a right to retire. 

If a person who is not a shareholder omits to do what is 
necessary to render himself a shareholder, he remains a non- 
shareholder, although very little may be wanting to render 
him a shareholder. On the other hand, if a person who is a 
shareholder already omits to do what is necessary to retire, 
he continues to be a shareholder whatever intention he may 
have had of withdrawing from the company, and whatever pre- 
liminary steps he may have taken for that purpose. In these 
cases that which is necessary to change an existing state of 
things has not happened : the right to enter or leave the com- 
pany has not been exercised ; and until such right has been 
exercised membership in the proper sense of the word has not 
been created in the one case, and has not ceased in the other. 
Subject then to the qualifications to be mentioned presently, 
before a person entitled to become a member actually becomes 
one, all necessary conditions must be fulfilled. 

There are many cases in the books illustrating this principle, 
and to which it may be convenient shortly to refer. 

7 &^ Vict. The repealed act 7 & 8 Vict. c. 110, defined a shareholder 

to mean any person entitled to a share, and who had executed 
the deed of settlement, or a deed referring to it (z) ; and it was 
held that no person was a shareholder within the meaning of 

(y) As to the construction of acts Eiamens, 1 C. P. D. 201 & 6G4 ; 

of Parliament, apparently making and as to allotting shares before 

payment by an allottee (or some any business can be carried on, see 

qualification) a condition precedent Ex parte Ward, L. R. 3 Ex. 180. 
to his becoming a shareholder, see (z) See 7 & 8 Vict. c. 110, § 3 ; 

East Gloucestershire Bail. Co. v. this definition did not apply to 

Bartholomew, L. R. 3 Ex. 15 ; Mc- mutual insurance societies : see the 

Euen v. West Bond. Wharves, d-c., section. 
Co., 6 Ch. 655, and Portal v. 


the act if he had not signed the deed, although he might be 1 k. I Chap. 2. 
entitled to shares and be registered and returned as a share- - 
holder (a). 

Other cases, in which the non-execution of the company's Non-execution 
deed has been held to prevent a person entitled to shares in a of deed " 
company from being a shareholder therein, will be found in 
the note below (b). 

Again, by the repealed Joint-stock companies act, 185G, it 19 & 20 Vi.-t. 
was declared that every person who had accepted shares in a °" " 
registered company, and whose name was entered in the 
register, and no other person (except a subscriber to the 
memorandum of association in respect of the shares thereby 
subscribed for by him), should for the purposes of the act in 
question be deemed to be a shareholder (c) ; and in the articles 
which, in the absence of other regulations applied to companies 
registered under the act, it was declared that no person should 
be deemed to have accepted any share unless he had testified 
his acceptance thereof, by writing under his hand in such form 
as the company from time to time should direct (</). Under 
these provisions it was held that a person who merely agreed 
to take shares, but did not testify his acceptance of them in 
the particular form required, did not become a shareholder, 
although he was registered as such (c). 

Upon precisely the same principle a purchaser of shares in Purchasers of 
a company is not a shareholder in it until he has made himself shares ' 
such by complying with its regulations as to the admission of 
members (/) ; and, on the other hand, a shareholder who has 

(a) Baily v. Universal Prov. Life heel Iron Co. v. Westoby, 8 Ex. 17 ; 

Assoc., 1 C. B. N. S. 557 ; Moss v. Waterford, d-c, Bail. Co. v. Pidcock, 

Steam Gondola Co., 17 C. B. 180 ; 8 Ex. 279. 
Wilkinson v. Anglo-Californian Gold (c) 19 & 20 Vict. c. 47, § 19. 

Co., 18 Q. B. 728 ; Stewart v. Sams, (d) 19 & 20 Vict. c. 47, table B. 

ib. 736. The registrar's certificate § 1. 

that a person had been returned as (e) New Brunsicick, &c, Bail. Co. 

a shareholder was prima facie evi- v. Muggeridge, 4 H. & N. 160 and 

dence of his being so. Turner v. 580. Compare this case with Bog 

Metropolitan Live Stock Co., 2 Ex. Lead Mining Co. v. Montague, 10 C. 

567 '• B. N. S. 481, where no particular 

(6) Irish Peat Co. v. Phillips, 1 B. form of acceptance was required. 
& Sm. 598 ; Carmarthen Bail. Co. v. (/) Hay v. Willoughhy, 10 Ha. 

Wright, 1 Fos. & Fin. 282 ; Galvan- 242. 



Bk. I. Chap. 2. so ld his shares remains a shareholder until the purchaser has 

Cestuis que 

complied with 
by the company. 

Type of a 

taken his place (Y/). 

Again, where shares are held by A., whether as trustee for 
B. or simply as his agent, and B. has done nothing to render 
himself a shareholder, according to the terms of the company's 
regulations, and has never acted or been treated as a share- 
holder, he is not a shareholder, although A. may be in- 
solvent (A). But as will be seen hereafter, a person cannot 
escape liability by assuming a fictitious name (i). 

A person who has entered into a binding agreement with a 
company to take shares in it, cannot complain if the company 
acts on the faith of the agreement, and complies for him with 
those formalities which he has bound himself to observe. Upon 
this principle, where a person has agreed with a company to 
take shares in it and nothing remains to make him a share- 
holder except to register him as such (A), and the company 
registers him accordingly, he becomes a member, although he 
may have protested against such registration (/). But it need 
hardly be observed that persons cannot be made members 
without their consent ; and if a company or some other person 
has placed shares in a person's name, and complied with all 
the formalities necessary to make him a member, he will never- 
theless not be a member, unless he has by agreement or other- 
wise authorised the acts in question, or ratified them, and 
thereby assented to take the shares (in). 

The type then of a member or shareholder of a company is 

(g) See, for example, Mid. G. IV. 
Rail. Co. v. Gordon, 16 M. & W. 

(/() See United Kingdom Mutual 
Strain AsmLranm Association v. 
Nevill, 19 Q. B. D. 110; Barrett* 
case, 4 De G. J. & Sm. 416 ; Muir's 
case, 4 App. Gas. 337 ; Ex parte 
Bugg, 2 Dr. & Sm. 452 ; Neivry 
Bail, Co. v. Moss, 1 4 Beav. 64 ; 
Jefferys v. Smith, :> Russ. 158, ami 
other cases referred to hereafter in 
book iv. c. 1, under the head Con- 
tributories. Compare Goddard v. 
Hodges, 1 Cr. & M. 33, and Cox's 

case, 4 De G. J. & Sm. 53. 

(i) Infra, p. 59. 

(/,-) This is essential, see Waterford, 
Wexford, dr., Bail. Co. v. Bidcock, 8 
Ex. 279 ; Carmarthen Bail. Co. v. 
Wright, 1 Fos. & Fin. 282. 

(I) Midland Gt. West. Bail. Co. v. 
Gordon, 16 M. & W. 804, and other 
cases of that class, noticed ante p. 23, 
and post. See, also, Leishman v. 
Cochrane, 1 Moo. P. C. N. S. 315. 

(m) See, for examples, Edv;arcls v 
Kilkenny Bail. Co., 14 C. B. N. S.' 
526 ; Fox's case, 3 De G. J. & S. 465 ; 
Higgs's case, 2 Hem. & M. 657. 


a person who has agreed to become a member, and with respect lik - T - Clia i'- -' 

Sect ■' 

to whom all conditions precedent to the acquisition of the - 
lights of a member have been duly observed. Where all these 
circumstances are combined, there is membership in the fullest 
and most accurate sense. This, indeed, would be too obvious 
to require express statement were it not useful to have present 
to the mind a standard by which to judge of other cases. In 
practice difficulties are only presented where this standard is 
not reached; and the important question really is to what 
extent it can be departed from, and membership be neverthe- 
less constituted. 

In the first place, a person bound bv agreement with a com- Membership in 
, •, , . equity, though 

pany to take shares in it, can be compelled specifically to not at law. 

perform his agreement, and on this principle he can often be 
treated as a member in equity (n). There are endless cases in 
the books in which persons not shareholders in the strict and 
proper sense of the word, have nevertheless been held to be 
contributories on the winding up of the company (o). But the 
equitable maxim that what has been agreed to be done is to be 
treated as done, is only a consequence of the more general 
principles applicable to the specific performance of contracts ; 
and the maxim only applies as between the parties to an agree- 
ment of which specific performance can be decreed and their 
representatives. If therefore a person has agreed, not with 
the company or its agents, but with some one else, to take 
shares [in the company, and such person does not perform 
those conditions which are necessary to render him a member 
thereof, then whatever his position and obligations may be 
as between himself and the other party to the agreement, he 
will not be a member of the company in equity any more than 
at law (j)). 

Secondly, the performance of conditions and observance of F ai T. of 

n «... ,. formalities. 

formalities may be dispensed with; and irregular, as distin- 
ct) The subject of specific per- (p) See Hay v. Willoughby, 10 

formance so far as it relates to shares Ha. 242. See, also, Humby's case, 5 

will be discussed hereafter. Jur. N. S. 215, and others of that 

(o) These cases will be noticed class noticed hereafter under the 

hereafter. Ydland's case, 5 De G. & head of Contributories. 

Sm. 395, illustrates the principle. 



Bk " Sec^T' 2 ' S uisliet * n ' om vok1 > transactions may be confirmed. Conse- 
~7 - quently, a person may become a shareholder to most, if not to 

Estoppel by . 

conduct. " all, intents and purposes, without complying with all the 
formalities prescribed in that behalf by the statute, charter, or 
deed of settlement constituting the company, and although 
there may have been irregularities in the issue of the shares to 
him ; for if, notwithstanding these circumstances, he has been 
treated as a shareholder by the company, and has acted as a 
shareholder, both he and the company will be estopped from 
denying that he is a shareholder. So, if a shareholder, having 
a right to retire, has in fact retired and been treated by the 
company as if he were no longer a shareholder, both he and 
the company will be estopped from denying that he has ceased 
to be a shareholder, although he may not have retired regularly 
and properly. This doctrine of estoppel by conduct has been 
frequently recognised (q), but its application is attended with 
difficulty, and involves the important question to what extent 
prescribed formalities and conditions can be disregarded by 
companies, i.e., by the persons who conduct their affairs, and 
whose obvious duty it is to observe what is prescribed. Upon 
this question opinions have differed, and the non-compliance of 
prescribed formalities has frequently been held to be conclusive 
upon the question of membership or no membership, notwith- 
standing an apparent waiver of those formalities by all parties. 
Moreover there are decisions which show that a person who, in 
an action for calls, is estopped from denying that he is a share- 
holder, may nevertheless show that he is not one when sued 
by a creditor of the company. 

It becomes necessary, therefore, to subdivide the cases 
bearing upon the present subject-matter of inquiry, and to 
distinguish those in which the question of membership or non- 
membership arises between the company on the one part, and 
an alleged member on the other, from those in which the 
question arises between the alleged member on the one part, 
and the creditors of the company on the other. 

(q) The leading authority on the Carr v. Lond. and N. W. Rail. Co., 
subject of estoppel by conduct is L. E. 10 C. P. 307. 


Bk. T. Chap. -'. 
First, as between the company and an alleged shareholder. Sect. -■ 

It has frequently been decided, even at law, that where a Effect of 
psrson has acquired a right to become a shareholder, and he toeen%hecum- 

has acted and been treated by the company as a shareholder, P an y and the 

. , shareholder. 

lie is liable to calls at the suit of the company, although he may 

not have complied with all the formalities prescribed by the 
regulations of the company for the admission of members. 
Thus, in Burncs v. Pennell (r), the deed of settlement of a Barnes r. 
company required certain acts to be performed by every pur- 
chaser of shares, before he could become entitled to exercise 
the rights of a shareholder. A purchaser of shares did not 
comply with the terms of the deed, but he nevertheless paid 
some calls made on his shares, and he was registered as a 
shareholder. It was held that he could not resist an action 
for further calls on the ground that he was not a shareholder. 

Again, in a case where an act of Parliament required that Sheffield, &c , 
the shares in a company should be transferred by deed stating Woodcock.' 
the consideration for the transfer ; and a person purchased 
shares without taking a proper transfer, the transfer being in 
blank, with the consideration stated untruly, but he neverthe- 
less signed a prox}* - paper describing himself as a shareholder, 
and transmitted it to the company, and was thereupon regis- 
tered as a shareholder, it was held, that in an action for calls 
by the company he was estopped from denying the validity of 
the transfer (s). 

80 in The Cheltenham and Great Western Union Railway Cheltenham, &c, 
Company v. Daniel (t), an original subscriber to a projected Daniel/ 
railway company sold his scrip to the defendant. The com- 
pany after its formation had notice of this sale from the 
defendant himself; he claimed to be registered in respect of 
the scrip which he had purchased, and he sent the certificates 
for such scrip to the company. The company gave him a 
receipt for the certificates and registered him as a shareholder. 

(;•) 2 H. L. C. 497. dke., Rail. Co. v. Locke, 1 Q. B. 256 ; 

(s) Sheffield, dr., Rail. Co. v. London Grand' June. Rail. Co. v. 

Woodcock, 7 M. & W. 574. See, Graham, ib. 271 ; Cromford, dr., 

too, Cheltenham Rail. Co. v. Daniel, Rail. Co. v. Lacey, 3 Y. & J. SO. 

2 Q. B. 281 ; Birmingham, Bristol, (t) 2 Q. B. 281. 

L.C. E 



Bk. I. Chap. 2. It was held that he was properly registered, and that he was 
Sect. 2. I I J t> > 

a shareholder, although the shares purchased by him had 

never been formally transferred to him from the vendor as 
required by the company's special act, and although the scrip 
certificates purported to be not transferable before the obtaining 
of the act. 
Non-execution On the other hand, in The Irish Peat Company v. Phillips («), 

deed. hfty shares, not numbered, nor distinguished from each other, 

Irish Peat Co. v. had been allotted to the defendant. He had paid some calls 
upon these shares, and he was registered as holder of them, 
but he had received no certificates for them, and he had not, 
as required, executed the company's deed. He had not done 
anything as owner except pay calls. Further calls having been 
made, he declined to pay them, mainly on the ground that the 
terms contained in the company's prospectus and letters of 
allotment had not been adhered to. Being sued for calls, the 
Court of Queen's Bench, and also the Court of Exchequer 
Chamber, held that the defendant was not liable for them ; but 
the two Courts differed in their reasons for so holding. 

The Court of Queen's Bench expressed a strong opinion 
that neither the non-execution of the conrpany's deed of set- 
tlement, nor the non-fulfilment of the terms contained in the 
company's prospectus and in the letters of allotment, afforded 
any defence to the action ; but that Court thought that, the 
shares not having been numbered, calls could not be made 
upon them (x). 

The Court of Exchequer Chamber did not express any 
opinion upon the second point, and intimated considerable 
doubt whether the fact relied upon by the Court of Queen's 
Bench was material, but held that the non-execution by the 
defendant of the company's deed of settlement afforded a com- 
plete defence to the action. 

Assuming that in the case in question the conduct of the 
defendant was not such as to preclude him from denying that 
he was a shareholder, the non-execution \>y him of the com- 
pany's deed was a sufficient answer to the action (y) ; but it is 

O) 1 B. k Sm. 598. 
(a?) See, as to this, East Gloucester- 
shire Rail. Co. v. Bartholomew, L. E. 

3 Ex. 15 ; InoVs case, 7 Ch. 485. 

(y) As in Wattrford, Wexford, £x., 
Hail. Co. v. Pidcock, 8 Ex. 279; ( 'ar- 


conceived that the mere fact that a person has not executed ;i 1;k - [■ <Jli:, i>- -• 
deed is not sufficient to exclude the application to him of the 
doctrine of estoppel by conduct where that doctrine would Phillips. 
otherwise apply. 

It is true, that in the cases cited below (z), and in all of 
which the defendant was held precluded by his own conduct 
from denying that he was a shareholder, it would seem that 
the company had no deed of settlement which shareholders 
were required to execute ; but the same observation does not 
apply to The Cro in ford and High Peak Railway Company Cromford, &c, 

.,.." . Rail. Co. v. 

v. Laccy (a), which does not appear to have been cited Lacey. 
in The Irish Peat Company v. Phillips. The Cromford and 
High Peak Railway Company was created by a special act, 
which in terms incorporated the defendant and other persons 
who were in effect recited in the act to have executed a certain 
deed which the defendant had not done. In an action for 
calls, it was held that the defendant was estopped by his con- 
duct from denying that he was a shareholder, and the Court 
was particularly careful not to let it be supposed that the 
defendant had become a shareholder nolens volens, by reason 
of the mere terms of the act. The defendant was held liable 
because, although he had not executed the company's deed as 
he ought to have done, he had with a full knowledge of all 
material facts acted and been treated as a proprietor of shares. 

The foregoing authorities are sufficient to illustrate the doc- Application of 

.. „ , ,. . .,...., „., doctrine against 

trine oi estoppel as applied against individuals. The same companies, 
doctrine, however, is applicable against companies, as is shown 
by those cases it which it has been held that companies cannot 
treat, as continuing shareholders, persons who have transferred 
their shares irregularly and improperly, but who have neverthe- 
less been dealt with by the company as no longer members of 

marthen Rail. Co. v. Wright, 1 Fos. & were actions for calls in which the 

Fin. 282. defendant had not executed the 

(z) Sheffield Rail. Co. v. Woodcock, deed of transfer. In Burnes v. 

7 M. & AV. 574 ; Cheltenham Rail. Pennell, 2 H. L. C. 497, what the 

Co. v. Daniel, 2 Q. B. 281 ; Rir- defendant ought to have signed was 

mingham Rail. Co. v. Locke, 1 Q. B. not a deed but a minute in the com- 

256; Lond. Gr. June. Rail. Co. v. pany's books. 
Graham, 1 Q. B. 271. All of these (a) 3 Y. & J. 80. 

I '2 



Bk. I. Chap. 

Sect. 2. 

between irre° 
lar and void 

Illegal issue 


it (b). These cases show conclusively that companies cannot, 
any more than individuals, take advantage of the non-obser- 
vance of formalities which they have not insisted upon, and 
have, tacitly at least, dispensed with (c) ; and they show further, 
that if the directors of a company, in transacting such business 
of the company as they are authorised to transact, neglect to 
observe the formalities prescribed by the regulations of the 
company, and treat an informal act as a formal one, and thereby 
induce others to do the same, the company is estopped from 
afterwards disputing the validit}- of what has thus been treated 
as valid by all parties. This proposition is also supported by 
many decisions upon the question, who are and who are not 
contributories under the winding up acts (<1) . 

The proposition thus established is perfectly consistent with 
the doctrine that companies are not bound by the acts of their 
directors in matters as to which the directors are not the com- 
pany's agents. The extent to which directors have power to 
bind their respective companies will be examined hereafter. 
It is sufficient to draw attention^ in the present place to the 
distinction between irregular acts and acts which are altogether 
unauthorised and are incapable of being confirmed ; and to 
warn the reader not to conclude from the decisions just 
adverted to, that a company is estopped from disputing the 
validity of acts done and treated as valid by its directors, if 
those acts are such as the directors have no authority to 
perforin and the shareholders cannot ratify (e). 

The cases which give rise to most difficulty are those in 
which a person has in fact acted and been treated as a share- 
holder in respect of shares which the company had no power to 
issue. If the shares can, under any circumstances, legally 
exist, then, however improper their issue may have been, the 
company and the holder of them may be estopped from denying 

(b) Bush's case, L. E. 6 H. L. 37, 
and 6 Ch. 246 ; Grady's case, 1 De G. 
J. & Sin. 488 ; Lane's case, ib. 504. 
See, too, Bargate v. Shortridge, 5 H. 
L. C. 297 ; and Taylor v. Hughes, 2 
Jo. & Lat. 24. 

(c) As to how far a company is 
estopped by it* own register, see 

infra, pp. 57, et seq. 

(d) See Straffon's executor's case, 1 
De G. M. & G. 576, and the cases in 
the last note but one. 

(e) See Grady's case, 1 De G. J. & 
S. 488, and Lane's case, ib. 504, and 
the cases in the next three notes. 

El FECT OF N..I OBSEITS IXG l ORJ] M.u m . 5c 

their existence and the holding of them by him (/) ; but it' ''•'■• f - Chap. 2. 

. Sect. '1. 

they cannot Legally exist, the person taking them cannot by - 

estoppel or otherwise become a member in respect of them. A Bank of Hindu- 
striking illustration of this is afforded by The Bank of Hindustan 

v. Alison (g), where one company had, in excess of its powers, 
amalgamated with another, and had, as part of the amalga- 
mation scheme, issued new shares in excess of the authorised 
capital : the issue being held void, it was also held, that a 
person who had taken some new shares and paid on them, and 
had retained them for some time without objection was, never- 
theless, not precluded from denying that lie was a shareholder. 
This same principle lias been recognised in equity as well as 
at law, as will be seen hereafter when treating of contributories 
and of the retirement of members (/<). 

[n equity, the mere execution of a company's deed does Estoppel by 
not preclude a person from denying that he became a share- 
holder (/), and it is presumed that now the same doctrine wil* 
apply at law. 

In connection with the doctrine of estoppel by conduct, it is Effect of ^ n °- 
important to consider the effect of ignorance of material facts, facts. 
Upon general principles it is conceived that a person who 
induces others to act upon the faith of an untrue repre" 
sentation innocently made by himself, cannot, as against them, 
take advantage of his own want of information ; as between 
them and him they ought not to be prejudiced by the circum- 
stance that he would not have made the representation if he 
had been better informed. But except where a person has 
induced others to act on his own representations, ignorance of 
material facts on his part affords a sufficient reason for not 
holding him bound by what in such ignorance he may have 
said or done. Accordingly, it has been held that if a company, 
in ignorance of material facts, is induced to register an im- 

(/) Campbell's case and Hippisley's (h) State and Worth's case, 4 Ch. 

case, 9 Ch. 1 ; Challis's case, 6 Ch. 082 ; Smith's case, il>. 611 ; Spack- 

266 ; Hare's case, 4 Ch. 503. man v. Evans, L. R. 3 H. L. 171. 

(g) L. II. 6 C. P. 54 & 222. The (,') Coleman's case, 1 De G. J. & 

Court of Chancery took a different Sm. 495. It was otherwise at law. 

view of the facts of this case ; (see See Hull Flax Co. v. Wellesley, 

9 Ch. 1) for the reasons given in 9 6 II. & N. 38. 
Ch. 17. 



Bk. I. Chap. 2. proper transfer of shares, it is not precluded from denying as 

— - against the transferee his title as a shareholder (k) ; although 

it cannot deny his legal title as against other persons who, on 
the faith of the company's register, or a certificate of his title, 
have bond fide bought his shares without notice of the impro- 
priety in the transfer to himself (7). 

Effect of vaiver 
as between 
and creditors. 

Moss v. Steam 
Gondola Co. 

Secondly, as between an alleged shareholder and a creditor. 

Whether a person is liable, as a shareholder, to be pro- 
ceeded against by the creditors of an incorporated or quasi- 
incorporated compairv depends upon the construction of the 
statute or charter which enables him to be proceeded against; and 
in cases of this kind which have generally arisen in courts of law, 
those courts have adhered very strictly to the language of the 
statute or charter (m). The doctrine of estoppel has not been 
applied in these cases, so as to enable a creditor to proceed 
against a person who, though not a shareholder, has been 
treated by the company as if he were one, or so as to prevent a 
creditor from proceeding against a person who has not ceased 
to be a shareholder according to the company's regulations, 
but who has been treated by the company's officers as no longer 
a shareholder in point of fact. 

In Moss v. The Steam Gondola Company (n), a person who 
had acted as a director of a company was held not to be liable 
to creditors as a shareholder as he had not executed the com- 
pany's deed, which was necessary to render him a shareholder. 
Upon the same principle, where a married woman was a share- 
holder in a company, and her husband was not entitled to act 
as a shareholder until he had complied with certain regulations, 

(k) Simm v. Anglo-American Tel. 
Co., 5 Q. B. D. 188 ; Hare v. London 
and North-Western Bail. Co., Johns. 

(/) See Shropsltire Union Rail. Co_ 
v. B., L. R. 7 H. L. 496, reversing 
S. C. L. R. 8 Q. B. 420 ; Ward v. 
South-Eastern Bail. Co., 2 E. & E. 
812; Baliia and San Francisco Bail. 
Co., L. R. 3 Q. B. 584 ; Hart v. 
Frontino and Bolivia Minimi <'o.. 

L. R. 5 Ex. Ill, and see also Simm 
v. Anglo-American Tel. Co., 5 Q. B. 
D. 188. 

(m) See Portal v. Emmens, 1 C. P. 
D. 201 & 664, and the cases there 
cited. Compare Kipling v. Todd, 
3 C. P. D. 350, and infra, Bk. Ill , 
c. 6, § 7. 

(n) 17 C. B. 180. See, too, Bail- y 
v. Universal Prov. Life Ass., 1 C. B. 
X. S. 557. 


it was held that he was not liable to be proceeded against as a ,;k - T - chap. 2. 

t. 2 

shareholder by creditors, as he bad not complied with those • ' ■ ■ ' • 

regulations, although be bad received bis wife's dividends, and 
bad voted at meetings, and otherwise acted as a shareholder (0). 

These principles were carried to their utmost extent in another 
casr, where a person who bad, in fact, retired from a company, 
was sought to be proceeded against as if be were still a share- 
holder. The case in question is instructive, as it was litigated 
both at law and in equity, and was carried to the House of 
Lords ; it moreover shows, better than any other, the different 
tendencies of the old Courts of law and equity to hold com- 
panies bound by the conduct of their managers and directors in 
matters of mere form. The case in question was decided at 
law under the name of Bosanquet v. SJwrtridge, in equityunder 
the name of Shortridge v. Bosanquet, and in the House of Lords 
under the name oiBargate v. Shortridge. 

In Bosanquet v. Shortridge (p), as it first came before the Bo3anquet v. 
Court, the plaintiff, who had obtained judgment against the 
public officer of a banking company, sought to enforce that 
judgment against the defendant, who was alleged to be a 
member of the company. The defendant had been a share- 
holder, but he had sold his shares to another person, and the 
transfer thereof to him was registered in the company's register. 
By one of the rules of the company no person was to be regis- 
tered as a shareholder without the consent of a board of 
directors, and in this case no such consent had been obtained ; 
and some time after the transfer had been registered the 
directors declared the transfer void, and the} r put the de- 
fendant again on the list, and returned him as a shareholder. 
They did this for the express purpose of enabling the plaintiff, 
as a creditor, to proceed against him. In appeared that in 
point of fact transfers had been for years registered like the 
one in question, viz., without the observance of the formali- 
ties required by the company's deed. The Court of Ex- 
chequer held that the defendant had not ceased to be a 
shareholder ; that he still was a shareholder within the true 

(0) See Ness v. Angas, 3 Ex. 805 ; Ness v. Armstrong, 4 ib. 21. 
(j?) 4 Ex. 699. 



Shortridge v. 

Bos .in iiiet. 

Bargate .v. 

Bk. I. Cbap. 2. intent of the company's deed ; and that he was therefore liable 

fcGCt. z. 

— • to be proceeded against by the creditors of the company. 

In consequence of this decision, the suit of Shortridge v. 
Bosanquet (q) was instituted for the purpose, first, of having 
it declared that the plaintiff (i.e., the defendant at law) was no 
longer a shareholder in the company, that his name might be 
erased from its books, and not be returned to the stamp office 
as if he were a member; and for the purpose, secondly, of 
restraining the creditor from proceeding to execution against 
the plaintiff. The Master of the Holls held that, after what 
had taken place, the compairy could not insist that the plaintiff 
was still a shareholder, or that his transferee was not : and, it 
being established that the creditor was proceeding at the insti- 
gation of the company, an injunction was granted as prayed by 
the bill. 

From this decree the creditor appealed to the House of 
Lords, but the decree was there affirmed, upon the ground 
that the company could not take advantage of the non- 
observance by its own officers of formalities required by its 
own deed (r). 

The decision thus affirmed is in conformity with a prior 
decision in Ireland in a case where it was held that a share- 
holder in a banking company had, as between himself and the 
company, ceased to be a member thereof, although he had 
retired irregularly ; and that, having ceased to be a member as 
between himself and the company, he was not liable to be sued 
as a member b} r a creditor of the compairy, instigated to sue 
him by its directors (s). 

In both of these cases the creditor was suing at the instiga- 
tion of the company. Had it not been for this circumstance 
there would have been no ground on which a Court of equity 
could have restrained him from exercising his legal rights. 
Nor is there any case in which a Court of equny has assisted 
a creditor against a person held at law not to be liable to be 
proceeded against as a shareholder. Indeed, except under 

Taylor v. 

Observations on 
these cases. 

(q) 16 Beav. 84. 

(r) Bargate v. Shortridge, 5 II. L. 
C. 297, decided by Lord St. Leonards, 
affirming the judgment of Sir John 

Eonully, Lord Cranworth not con- 
curring. - 

(s) Taylor v. Hughes, 2 Jo. & Lat. 

l;l GIS I ER8 01 SB tftEHOLDERS. 57 

very special circumstances, a Courl of equity would have had Bk. I. Chap. 2. 

no jurisdiction in the matter. If, however, such a case as 
Bargate v. Shortridge were now to arise, the equitable princi- 
ples on which it was ultimately decided would be applicable to 
the proceedings taken by the creditor. 


With reference to the question whether a person is or is not Register of 
a shareholder in a company, the state of its register of share- s 
holders is of considerable importance. 

Shares in companies being marketable commodities, transfer- 
able from one person to another, some method of registration 
is indispensable, in order that the persons who are at any given 
time members of the company may be known. But a register Register as 
of shareholders would be of little use if it were not admissible e ^ 
in evidence both for and against every person whose name is 
upon it ; and it is therefore necessary, not only to have a 
register, but to make it evidence in judicial proceedings. The 
simplest, and at the same time most just way of accomplishing 
this is, to compel every member either to write his name in a 
book kept by the company, or to give some officer of the com- 
pany a written authority to insert his name therein. Another, 
but much more arbitrary wa} r , is to make it the duty of every 
company, or of some official, to keep a register of shareholders, 
and to make that register evidence against any one whose 
name may be upon it, without the necessit}- of showing by 
what authority it was put there. The former of the modes is 
commonly had recourse to in mining districts where partner- 
ships with transferable shares have long been known ; but the 
latter mode has been adopted by the legislature, and prevails 
in most companies governed by acts of Parliament (t). A par- 

([) The making of companies' and Taunton, dr., Co. v. Amos, 1 M. 
Looks evidence against their mem- & S. 569. 
tiers is not a new device, see Bristol 


Bk. I. Chap. 2. liamentary register of shareholders thus hecornes a "most im- 

bect. 3. " 

- portant document ; for, speaking generally, unless a person is 
on it, he is not entitled to the rights of a shareholder, whilst if 
he is on it, he is suhject to all the liabilities of a shareholder, 
unless he can show that his name ought not to have been on 
the list. The acts of Parliament relating to registers of share- 
holders are unfortunately numerous and differently worded, 
and it is necessary, before determining the effect of being on 
or off the register of a particular company, to examine the 
provisions of the act which applies to it. 
General rules on One or two general rules relating to these registers re- 

tlns subject. , ° & 

gamed as evidence of membership, may, however, be usefully 
adverted to : — 

1. The rule that a register or official return shall be evidence 
in favour of a company keeping or making it, is contrary to 
general principles of evidence and is a great privilege, and in 
order to enjoy this privilege, the register or return must 
be kept or made as required by the statute making it evi- 
dence (w). 

2. At the same time, if the provisions of the statute are 
substantially complied with, the register or the official return, 
as the case may be, will be admissible in evidence, although it 
may be in some respects inaccurate or informal, e.g., if a 
shareholder's residence is omitted (x) ; if some of the amounts 
paid are not entered (y) ; if the numbers of the shares are 
omitted (z) ; if the heading of the return is not strictly accu- 
rate (a) ; if the return does not purport to be signed by the 
person whose duty it is to sign it (6) ; if it was signed at the 
wrong time (c). Moreover, inaccuracies as to some persons do 

(h) Bain v. Whitehaven, dr., Bail. Bail. Co. v. Bartholomew, L. R. 3 

Co., 3 H. L. C. 1. Ex. 1.3. 

(x) Wills v. Murray, 4 Ex. 843. (a) Bain v. Whitehaven Bail. Co., 

(//) Bain v. Whitehaven Bail. Co., 3 H. L. C. 1 ; JJosset v. Harding, 1 

3 H. L. C. 1 ; Bond, and Grand C. B. N. S. 524 ; Fowls v. Harding, 

June. Rail. Co. v. Freeman, 2 Man. ib. 533. 

& Gr. 606 ; Birmingham and Bristol (Ji) Harvey v. Scott, 11 Q. B. 92 ; 

Rail. Co. v. Bocke, 1 Q. B. 256 ; Field v. Mackenzie, 4 C. B. 705. 

Bond, and Grand June. Bail. Co. v. (c)" Henderson v. Boyal British 

Graham, ib. 271, Bank, 7 E. & B. 356; Daniel v. 

(V) Ib. and East Gloucestershire Royal British BanJe, 1 H. & N. 681. 

RJ <.isi BRS AS ]\ [DEN( i . 


n<»( preven< the register or return from being evidence against r,k - l cha P- '-'• 

,. .... Beet 3. 

others us to whom there is no inaccuracy (<1). But if what is 

called a register is only a rough memorandum, it cannot be 

regarded, although it is sealed (e). A share ledger, however, 

has been held sufficient (/). 

3. A person who assumes a fictitious name or whose name is 
inaccurately stated, but whose identity can be established, 
cannot escape liability as a shareholder on the ground of the 
inaccuracy (g) ; and the use of a fictitious name only increases 
the difficulty of proving identity (//). 

4. The register or return is no evidence of the membership 
of a person except at and after the date at which the register 
or return becomes official (/). 

5. Unless the statute making the register or return evidence, 
clearly and indisputably makes it conclusive evidence, the 
register or return will be prima hide evidence only of the 
truth of the statements in it ; so that not only may a person 
whose name is on the register or return show that his name 
ought not to have been there (/,) ; but a person whose name is 
not on it may be shown to have been in fact a member when 

(d) Southampton Dock Co. v. 
Richards, 1 Man. & Gr. 448 ; London 
and Brighton Bail. Co. v. Fairclough, 
2 ib. 674. 

(e) Wolverhampton New Jf'nt<r- 
works Co. v. Hawkesford, 6 C. B. N. 
S. 336 ; 7 ib. 795, and 11 ib. 456, 
approved by the Exchequer Cham- 
ber in Irish Peat Co. v. Phillips, 1 

B. & Sm. 638. See, too, Birkenhead, 
Lancashire, dr., Bail. Co. v. Brown- 
rigg, 4 Ex. 426 ; Cheltenham and 
Great Western Bail. Co. v. Price, 9 

C. & P. 55. 

(/) Weikersheim's case, 8 Ch. 831. 

(g) Thomson v. Harding, 1 C. B. 
N. S. 555 ; Clowes v. Brettell, 11 M. 
& W. 461 ; Pugh and Sharman's case, 
13 Eq. 566 ; Cox's case, 4 De G. J. & 
Sm. 53. 

{h) Arthur v. Midland Bail Co., 3 
K. & J. 204. 

(i) Aylesbury Bail. Co. v. Thomp- 
son, 2 Ea. Ca. 668 ; Cheltenham Bail. 
Co. v. Price, 9 C. & P. 55. Compare 
Bosanquet v. Sliortridge, 4 Ex. 699. 

(k) See Portal v. Emmens, 1 C. P. 
D. 212 ; Hallmark's case, 9 Ch. I). 
32!) ; Powis v. Butler, 3 C. B. X. S. 
645, and 4 ib. 469 ; Galvanized Iron 
Co. v. Westoby, 8 Ex. 17 ; Waterford, 
Wexford, &c, Bail. Co. v. Pidcock, 8 
Ex. 279 ; Carmarthen Rail. Co. v. 
Wright, 1 Fos. & Fin. 282 ; Shrop- 
shire Un. Canal Co. v. Anderson, 3 
Ex. 401 ; Bailey v. Universal Pror. 
Life Ass., 1 C. B. N. S. 557 ; Moss 
v. Steam Gondola Co., 17 C. B. 180 ; 
Wilkinson v. Anglo -Calif or nian Gold 
Co., 18 Q. B. 728 ; Stewart v. Same, 
ib. 736 ; Edwards v. Kilkenny Bail. 
Co., 14 C. B. N. S. 526 ; Birch's case, 
■2 De G. & J. 10. 


Bk. I. Chap. 2. the register or return became official (I) ; so if no register has 

Sect. 3. . 

been kept (m). 

6. It follows that a company is not necessarily estopped by 
its own register. This was assumed by the Court of Ex- 
chequer in The Waterford and Wexford Railway Company v. 
Pidcock (n), where the defendant was held not to be liable to 
calls because, though on the register, he had been placed there 
before he had become a shareholder ; and because, notwith- 
standing the register, he was not entitled to exercise the rights 
of a shareholder (o). So where a company has, in ignorance of 
material facts, registered a forged or improper transfer, it is 
not estopped by its register from denying as against the regis- 
tered transferee that he is a shareholder (p). 

7. A person improperly registered as a shareholder in a 
company cannot be considered as holding himself out as a 
shareholder merely because he takes no steps to have his 
name removed (q). But as regards some companies, it is 
enacted that a person once properly registered as a share- 
holder is to be deemed a shareholder so long as his name 
remains on the register (r) ; and as will be seen hereafter, a 
person once put on the register with his consent may lose his 
right of repudiating his shares by delaying to have his name 
removed (s). 

(I) See Rastrick v. Derbyshire, (p) Simm v. Anglo-American Tel. 

&c, Bail. Co., 9 Ex. 149 ; PrescoU Co., 5 Q. B. D. 188 ; Hare v. Lond. 

v. Buffrey, 1 C. B. 41 ; Bank of and N.-W. Bail. Co., Johns. 722. 

England v. Johnson, 3 Ex. 598; But as to persons acting on the faith 

Wolverhampton Waterworks Co. v. of the register, see Ward v. S.-E. 

Hawkesford, 6 C. B. N. S. 336 ; 7 Bail. Co., 2 E. & E. 812 ; and Hart 

ib. 795, and 11 ib. 546; JVhittefs v. Front ino and Bolivia Mining Co., 

case, 2 De G. & J. 577. The ques- L. B. 5 Ex. 111. See, also, infra, p. 

tion whether a person is a contri- 64, note (t). 

butory or not in consequence of (7) See Somerville's case, 6 Ch. 

being on or off the register will be 266 ; Bullock v. Chapman, 2 De G. 

adverted to in a subsequent chapter. & S. 211 ; F>ircJi , s case, '2 De G. & 

(m) See Ported v. Emmcns, 1 C. P. J. 10. 
D. 201 & 664, which turned on the (r) See Ex parte Preseott, Mon. & 

Companies Clauses Cons. Act and a Ch. 611 ; Harvey v. Scott, 11 Q. B. 

special act. 92. This subject will be reverted 

(n) 8 Ex. 279. to hereafter. 

(0) See, too, Shropsldre Union, dr., (.s) See Oakes v. Turquand, L. B. 

Co. v. Anderson, 3 Ex. 401, and the 2 H. L. 325, and other cases of that 

other cases in notes (/.•) and (/). class. 



Where ;i company or its officers are required to keep a oLS 3 
register of shareholders, it is their duty to keep such register : 

1 Correction of 

accurately, and it' they refuse to insert the name of a person agister. 
entitled to be registered, or to erase the name of a person 
improperly registered, in either ease upon complaint being 
made to the proper tribunal, the company or its officers will 
be ordered to correct the register. Several modern acts of 
Parliament contain express provisions upon the subject of 
correcting registers, and these provisions will be noticed here- 
after when treating of the companies to which they relate. 
Ijiit even where there is no statutory enactment expressly 

applicable to the case, a mandamus or an injunction will be Mandamus and 


granted to compel a company, required hy statute to keep a 
register, to insert a name improperly excluded (t), or to 
compel the company to remove a name improperly inserted («)■ 
A mandamus will not, however, go to compel a company to 
remove its seal from a register which it has sealed, although 
it may he shown that the register is incorrect, and that it has 
been sealed without authority (x). 

A person asserting his right to be on the register must 
prove his title to the shares in respect of which he claims to be 
registered (y), and his right to be on the register (z) ; but if he 
has already been registered, and he complains of being struck 
off, the onus is on the company to show its right to remove 
his name (</). It has been held that a mandamus will not be 
granted in favour of a person wdio seeks to become a registered 
shareholder for the purpose of being troublesome (b) ; nor in 

(t) R. y.Reg. of Jt. St. Companies, Chapman, 2 De G. & S. 211, the 

21 Q. B. D. 131 ; Paris Skating Rink Court declined to interfere, the case 

Co., 6 Ch. D. 731 ; R. v. Camatic not being sufficiently clear. 

Rail. Co., L. R. 8 Q. B. 299, a case (.-•) Ex parte Nash, 15 Q. B. 92. 

of a married woman ; R. v. Shrop- (y) Daly v. Thompson, 10 M. &W. 

shire Union Rail. Co., L. E, 8 Q. B. 309. 

420, reversed but not on this point, (z) British Sugar Co., 3 K. & J. 

L. R. 7 H. L. 496 ; Norris v. Irish 408. 

Land Co., 8 E. & B. 512 ; Waul v. (a) See Ward v. S.-E. Rail. Co., 2 

S.-E. Rail. Co., 2 E. & E. 812. E. & E. 812 ; East Wlieal Martha 

(u) Eustace v. Dublin Trunk Rail. Mining Co., 33 Beav. 119. 
Co., 6 Eq. 182 ; Taylor v. Hughes, 2 (6) See Reg. v. Liverpool, Man- 
Jo. & Lit. 24; Shortridge v. Bosan- Chester, dr., Rail. Co., 21 L. J. Q. B. 
quet, 16 Beav. 84. In Bullock v. 284. 


r»k. I. Chap. 2. favour of a person whose own negligence lias occasioned the 

Sect. 3. „ , . . . 

— state of things which he seeks to have rectified (c). Moreover, 

Correction of . . ,.,... ,, ,, 

register. where an important question, e.g., liability to calls is actually 

pending between a person and a company, a summary applica- 
tion to rectify the register will not be entertained unless it can 
be shown that it is necessary to rectify the register in order 
that the real question in dispute may be fairly decided (d). 
But the mere fact that the application to have the register 
rectified involves the decision of an important and difficult 
question is not sufficient to induce the Court to refrain from 
ordering it to be rectified (e). Nor will the Court decline to 
order the name of a person to be struck off the register simply 
because his shares are marked forfeited, and his name has 
been already removed (/). The order to remove is a great 

Where a register is rectified by order, it should so appear 
on the register ([/). 

Where a person on the register applies to have his name 
struck off, and the name is alleged not to refer to him but to 
some other person, the Court will not expunge the name until 
satisfied upon the question of identity (It). 

The right of a married woman to be registered has been 
noticed already (i). 

With respect to the registration of titles to shares, it has 
been held that a company is not bound to register complicated 

(c) See Ex 'parte Swan, 7 C. B. of Parliament differently worded 
N. S. 400, and Swan v. North Brit. from the Companies act, 1862, as to 
Australian Co., 7 H. & N. 603, and which see infra. 

2 H. & C. 175. The extreme diver- (e) Higg's case, 2 Hem. & M. 657 ; 

sity of opinion of the judges before Los' case, 6 N. R. 327. 

whom this important case came (/) Martin's case, 2 Hem. & M. 

renders it unsatisfactory as a guide 669 ; Los* case, 6 N. R. 327. 

for the future. Compare Tayler v. (g) See Iron Ship-Building Co., 34 

Great India Peninsular Rail. Co., 4 Beav. 597. 

De G. & J. 559 ; and see the ob- (/<) See IVehVs case, 9 Jur. N. S. 

servations of Y.-C. Matins in 11 Eq. 856, where a person was removed 

319. from the list of con tributaries, but 

(d) Anglo-French Poicelain Co. v. his name was left on the register of 
Harris, 5 H. & N. 809; British shareholders. 

Sugar Refilling Co., 3 K. & J. 408. (i) Ante,]). 41. 
These cases, however, turned on acts 


deeds of transfer, e.g.. marriage settlements, by which shares l!k - \ Chap. 2. 

Sect. •*}. 

are assigned to trustees upon the usual trusts for the husband 

and wife, and their children (k). 

Companies are too frequently in the habit of altering their Right of com- 

own registers by striking off the names of persons whom they i te register. 

do not wish to recognise as shareholders and by substituting 

other names in their places. Such proceedings cannot be too 

strongly reprobated (I). When once a person is registered as 

a shareholder, and his name has been since removed, the onus 

of justifying the removal is on the company ; and it has been 

held, that even where his title is defective the company has 

no right to strike off his name unless his shares are claimed by 

a person establishing a better title to them (m). A company 

can however rectify its register in order to correct its own 

mistakes (»)• 

A person entitled to be registered as a shareholder by a Actions for im- 
... .. , ., ., proper exclusion 

company can maintain an action against the company, or those f rom or insertion 

of its officers whose duty it is to register him as a shareholder, in re = l - stei '- 
if they wrongfully refuse to register him. In such an action 
it is no defence that the register is full, if it is so impro- 
perly (o) ; and if the plaintiff complains that, in consequence of 
his name not being registered, his shares have been forfeited 
without notice to him, it is no defence that the forfeiture is a 
mere nullity, and that the plaintiff has therefore sustained no 
damage (})). In like manner a person w T ho has transferred his 
shares is entitled to maintain an action for damages against a 
company for improperly refusing to register the name of his 
transferee (q). The principles on which these decisions are 
based are, it is conceived, sufficient to support an action for 
damages by a person improperly inserted in a company's 

(k) Reg. v. General Cemetery Co., (a) Hartley's case, 18 Eq. 542, and 

E. & B. 415 ; Copeland v. Xorth-E. 10 Ch. 157 ; Re Etna Ins. Co., Ir. 

Rail. Co., ib. 277. Rep. 7 Eq. 264. 

(I) See the judgments in the cases (o) Daly v. Thompson, 10 M. & W. 

below. 309. 

(ru) See Ward v. South-E. Rail. (p) Catchpole v. Ambergate, &c, 

Co., 2 E. & E. 812 ; Hart v. Frontino Rail. Co., 1 E. & B. 111. 

and Bolivia Mining Co., L. R. 5 Ex. (q) Skinner v. City of London 

111. Compare Hare v. Lond. and Marine Insurance Corporation, 14 

Xm-th-ir. Rail. Co., Johns. 72± Q. B. D. 882. 


Bk. I. Chap. 2. register : but the writer is not aware of any case bearing 

Sect. 8. , .*''_. . 
directly on this point. 

Right to register It has been already seen that if a person is bound by agree- 

a person against .,, , ■, ■, • , .-, 

his will. ment with a company to take shares in it, the company is 

entitled without more, to act on the agreement and to register 
him as a shareholder (>•). 
fVHificates of In addition to the evidence of membership obtainable from 

registers of shareholders, many companies are required by 
statute to give every shareholder, on demand, a sealed certi- 
ficate of his ownership of the shares, to which he is entitled. 
The object of this is to enable a shareholder to prove that he 
is such ; and particularly to enable him, upon a sale of his 
shares, to prove his title to them to the satisfaction of a pur- 
chaser, and to show how much has been paid up in respect of 
them («). The company cannot dispute the truth of the certi- 
ficate as against a person who has bought on the faith of it (t). 
But the certificate applies only to the legal, not to the equit- 
able title of the person named in it {u). No person is entitled 
to demand a certificate of title to shares in a company until he 
has done everything necessary to constitute himself a share- 
holder in the full sense of the word {x). 
Admissions. A person may be proved to be a member of a company by 

his own admissions. Thus it has several times been held 
that a person who has admitted himself to be a shareholder 
in a company constituted by deed, may be rendered liable as 
a shareholder without any evidence being given as to that 
deed (y). 

(r) Ante, p. 46. and Bolivia, dec, Mining Co., L. R. 

(s) See upon this subject, Hare v. 5 Ex. 111. Gomp. ante, p. 60, 

Waring, 3 M. & W. 362 ; Curling v. note (p). 

Flight, 6 Ha. 41, and 2 Ph. 613 ; (u) Shropshire Union Rail. Co. v. 

Shaw v. Fisher, 2 De G. & S. 11. 7?., L. B. 7 H. L. 496, reversing 

(t) Burkinshaw v. Nicolls, 3 App. S. C. L. R. 8 Q. B. 420. 

Cas. 1004, affirming British Farmers' (re) Wilkinson v. Anglo-Californian 

Pure Linseed Cake Co., 7 Ch. D. 533 ; Gold Co., 18 Q. B. 728 ; Stewart v. 

Si m in v. Anglo-American Tel. Co., Ang.-Cal. Gold Co., ib. 736. 

5 Q. B. D. 188 ; Barrow's case, 14 (//) liar,; y v. Kay, 9 B. & C. 356 ; 

Ch. D. 432 ; Shaw v. Port Philip Ralph v. Harvey, 1 Q. B. 845 ; and 

Gold Mining Co., 13 Q. B. 1). 103; see Tredicen v. Bourne,6 M. & W. 

Bahia and San Francisco Rail. Co., 461. 
L. B. 3 Q. B. 581 ; Hart v. Frontino 

SCRIP. <»■ 

Admissions, however, arc not necessarily conclusive, and 1;k - '• Chap. 2. 

Sect. 4. 
little weight oimht to be attached to them if it is shown that 

they were made under erroneous suppositions (z). This seems 
to have heen the true ground of the decision in the much 
debated case of Vice v. Anson (a). There the defendant sup- Vice v. Anson, 
posed herself to be a shareholder in a mine ; she had in private 
letters and in private society written and spoken of herself as 
a shareholder ; she had received certificates stating that her 
name was registered in the act-book of the mine, and that she 
was entitled to share the profits of it; and lastly, she had paid 
deposits on her shares. But Lord Tenterden held that she 
had not in point of fact any interest in the mine, and that as 
she never represented to the plaintiff that she was a share- 
holder therein, she could not be made liable to him simply 
because of her erroneous suppositions and admissions. 


In order to enable persons who do not desire to become Scrip, 
shareholders to acquire the right so to become and to transfer 
that right to others, recourse is had to what are called scrip 

A scrip certificate is an acknowledgment by a company or 
its projectors that the person named in the certificate (or more 
commonly the holder) is entitled to a certain specified number 
of shares in the undertaking. The certificate represents a 
right to acquire, but not necessarily an obligation to take a 
share (b). The certificate must have a penny stamp (c). 

(z) See Ridgway v. Philip, 1 Cr. she not entitled as a partner to 

M. & E. 415. share the profits obtained by work- 

(«) 7 B. & C. 409, and Moo. & M. ing the mine I and what more was 

98. See, on this case, Owen v. Van necessary to make her liable to the 

Uster, 10 C. B. 318, and qu. if it is supplier? 

law ; for though the defendant had (6) Eustace v. Dublin Trunk Rail. 

no legal interest in the mine, was Co., 6 Eq. 182 ; Ormerod's case, 5 Eq. 

(c) See note (r) next page. 

66 scrip. 

Bk. I. Chap. 2. j n some companies nothing is required to convert scrip- 

- holders into shareholders. Companies constituted upon this 
Scrip companies. . , n . . . . . ., . ■• 

principle are called scrip companies, and m them scrip and 
shares are synonymous, there being in fact no difference 
between scripholders and shareholders (d). 
Scripliolders Usually, however, a person entitled to scrip does not acquire 

shareholders. the rights of an actual shareholder until his scrip certificates 
have been delivered up and exchanged for share certificates, 
nor until his name has been inserted upon the company's 
register of shareholders. Generally speaking, after a company 
is formed, its scrip is called in ; i.e., the holders of the scrip 
are required to exchange their certificates for share certificates, 
and to do whatever else may be necessary to render them 
members of the company, as distinguished from persons who 
have only a right to become members. In such cases as these, 
scripliolders are not shareholders, nor are they partners either 
with each other or with the promoters of the company (e). 
This doctrine results from the distinction between agreements 
to form a future partnership and contracts for a present part- 
nership (/) ; but as will be seen hereafter, it does not follow 
that a company which progresses no further than the issue of 
scrip cannot be wound up ; nor that upon the winding up of 
such a company scripliolders are not liable to be put upon the 
list of contributories {g). 
Transfer of scrip. ^i ie e ff ec t of a transfer of scrip will be alluded to hereafter, 
when treating of the transfer of shares. It may, however, be 
noticed here that scrip certificates are not negotiable instru- 
ments ; but if they are proved to be so in any jjarticular case, 
they cannot be recovered from a bond fide holder for value 

110 ; Ex parte Collum, 9 Etp 236 ; (e) See the cases in note (b), and 

He Littlehampton Steam Shi}) Co., 34 Fox v. Frith, 1 Car. & M. 502. 

Beav. 256, and 2 De G. J. & Sm. (/) As to which, see Partn., p. 

521 ; Jackson v. Cocker, 4 Beav. 59. 20. 

Clark v. Newsam. 1 Ex. 131, shows (</) See, on this subject, Barclay's 

that to forge scrip was only a mis- case, 26 Beav. 177 ; Re Aston, 27 ib. 

demeanour under 1 Win. 4, c. 66. 474, and 4 De G. & J. 320 ; Grise- 

Compare 24 & 25 Vict. c. 98, § 23. wood and Smith's case, 4 De G. & 

(c) 33 & 34 Vict. c. 97, § 3. J. 544, and the cases cited in 

(d) As to the legality of scrip note (i). 
companies, see infra, ch. v. 

SCRIP. an 


without notice of any infirmity in the title of the person from ut r. Chap. 2. 

whom lie has taken them (A). ,Sect 4 - 

^ (A) See Goodwin v. Jfoforta, 1 App. pany, and the mercantile usage was 

Las 476 ; a case of a foreign govern- proved. Qu., how often will it have 

ment loan. In Rumball v. Metro- to be proved before the usage is 

pohtan Bank, 2 Q. B. D. 194, the judicially recognised ? 
scrip was that of a banking com- 

f 2 





Having now explained the doctrines relating to agreements 
to take shares, and what constitutes membership, it will be 
convenient to consider the position of persons who have been 
induced to enter into such agreements and to take shares by 
false, and, in many cases, fraudulent misrepresentations. 

Bk. I. Chap. 3, 
Seot. 1. 

in piospectus. 

must be of 


1. Requisites for Redress. 

Nothing is, unfortunately, more common than the occur- 
rence of serious mis-statements in a company's prospectus. 
These mis-statements are sometimes the result of ignorance 
and carelessness, but they are sometimes also the result of 
deliberate fraud. "Whatever may be their moral aspect, their 
effect is to induce persons to take shares on the faith of their 
accuracy ; and the question then arises whether the shares so 
taken can be repudiated, or what reined}-, if any, is open to 
those who have been induced to take shares on the faith of 
the truth of the statements. 

It will be convenient to consider first those requisites which 
must be proved in order to entitle the complainant to any 
redress at all, and then to consider what further is necessary 
to entitle him — 1. To relief against the company by way of 
rescission of contract and indemnity ; 2. to relief in the shape 
of damages against the individuals who have misled him. 

In the first place it must be observed that statements which 
are not statements of fact, but which are expressions of 


sanguine expectations are not actionable, although they prove Bk - *■ ' ; ha P- :; - 
to be unfounded (a) ; nor, are extravagant expressions of - 
opinion as to value (b). 

In Bellairs v. Tucker (c) the prospectus stated that for ikiiairs v. 
reasons given a dividend of 50 per cent, was confidently ex- 
pected ; the reasons wore unsatisfactory, and the company 
proved a total failure ; but there was no actual mis-statement 
of any fact, and an action brought to recover damages from 
those who issued the prospectus failed. 

It must not, however, he assumed that an expression of an False statement 

of intention. 

opinion, or of an intention, or of a purpose, may not he a 
statement of fact within this rule. If an opinion, intention, 
or purpose is not in truth entertained, those who say the 
contrary mis-state a fact. Therefore, in Edgington v. Fitz- gJgington v. 
maurice (d), where a prospectus was issued inviting subscrip- 
tions to debentures for a purpose, which was not the true 
purpose for which money was wanted, a person who took 
debentures which proved worthless was held entitled to main- 
tain an action against those who had fraudulently misled him. 

Secondlv, amis-statement of fact must, in order to entitle Statement must 

; be untrue. 

a person to any relief in respect of it, be untrue when made ; 
or, if then true, must be untrue when it is intended to be acted 
upon and is acted upon. It has already been seen (e) that if 
an application for shares is made on the faith of a statement 
which is true when made, but which is not true when shares 
are allotted to the applicant, he may refuse to take them. 
Further, a statement that an existing condition of things is 
likely to last, is not true if circumstances have occurred which 
will soon put an end to it ; and a statement that a condition 
of things exists may be so expressed as to be intended to lead, 
and so as in fact to lead, to the inference that the condition 
not only exists now but will exist for some reasonable time to 
come. A statement to this effect is fraudulent if the person 
who makes the statement knows that permanence in the sense 
implied cannot be relied upon, or that the state of things has 

(a) Hallows v. Ferule, 3 Ch. 467, (J) 29 Ch. D. 459. 

and 3 Eq. 520. (e) Anderson 's case, 17 Ch. D. 373 ) 

(6) Denton v. Macneil, 2 Eq. 352. ante, p. 21. Compare Hallows v. 

(c) 13 Q. B. D. 562. Fernie, 3 Ch. 467, and 3 Eq. 520. 


Concealment of 
material facts. 

Bk. I. Chap. 3. ceased when its continuance is still believed in by a person 

— acting on the faith of the statement (/). But in the absence 

of such knowledge the fact that what was true has ceased to be 
so, cannot entitle a person who is a shareholder to relief unless 
indeed there is some contract express or implied guaranteeing 
him against the consequences of change. 

By the law of this country the duty of a person bargaining 
with another to disclose all material facts known to himself is 
confined to a very limited class of contracts (g). In all con- 
tracts of buying and selling the maxim is caveat emptor ; and 
contracts to take shares are apparently governed rather by this 
principle than by any other (h). At the same time, if persons 
issue prospectuses or make statements, and fraudulently sup- 
press material facts which render the statements made untrue, 
an action for damages may be sustained against them (■?*). 
A fortiori, will such a concealment support an action for 
rescission of contract. But such an action cannot apparently 
be supported by a person induced to take shares by the con- 
cealment of a material fact unless there has been some untrue 
statement (k). 

Thirdly, the mis-statement of fact must have been made 
with a view to induce the person complaining of it or persons 
in general to act upon it. A mis-statement made by A. to B., 
but not intended to influence C, nor any class of persons of 
whom C. is one, does not entitle C. to redress, although he 
may have heard of it and acted upon it and suffered loss (I). 

Fourthly, a mis-statement of fact in order to entitle a 
person to any relief in respect of it, must be material to the 

Intention with 
which false 
statement is 

False statement 
must be mate- 

(/) See Traill v. Baring, 4 De G. 
J. & S. 318 ; and Brownlie v. Camp- 
bell, 5 App. Cas. 950, per Lord 

(g) See Davies v. Lond. and Prov. 
Marine Ins. Co., 8 Ch. D. 469, a case 
of suretyship. 

(/t) See the next note. In l\vy- 
cross v. Grant, 2 C. P. D. 469, reasons 
are given against this view. 

(i) See Peek v. Gurney, L. R. 6 
H. L. 377, and 13 Eq. 79 ; Ark- 
v- right v. Newbold, 17 Ch. D. 301. 

(k) See the last note and the judg- 
ments in New Sombrero Phosphate Co. 
v. Erlanyer, 3 App. Cas. 1218, and 
5 Ch. D. 73, a promoter's case ; 
Oakes v. Turquand, L. R. 2 H. L. 
325 ; Pidsford v. Richards, 17 Beav. 
87 ; hut see 5 App. Cas. 950, per 
Lord Blackburn. 

(I) See Peck v. Gurney, ubi supra ; 
and the note to Chandelor v. Lopus, 
1 Sm. L. C. ; compare Cann v. 
Wilson, 39 Ch. D. 39. 


contract into which the statement induced him to enter. It Bk. I. Chap. 
must be a statement but for which he would not have entered 

into it. Mis-statements relating to trifling matters of detail, 
or statements which though not true when made were true 
before their untruth became important, are not sufficient to 
sustain cither an action for damages or for rescission of con- 
tract din. 

In Ship v. Cro88kill (n) a prospectus stated that more than Ship v.\ 
half tli.' capital had been subscribed for. This was not true ; Crosskl L 
hut it was true soon afterwards, an 1 before the plaintiff 
applied for shares. He was held not entitled to maintain 
an action for damages against the directors for misrepre- 

Fifthly, the person complaining of the mis-statement must F<dse statement 
in fact have acted on the faith of it {<>). Further, if the state- acted upon. 
ment on which he relies is fairly capable of two meanings, one 
true and the other false, lie must show which meaning he 
attached to it, and that lie understood it in the sense in which Ambiguous 
it was false. Smith v. Chadivick (p) is the leading case on Smith r 
this point. The statement there was — " The present value of Chadwick. 
the turnover or output of the entire works is over 1,000,000/. 
per annum." This was true in one sense but not in another ; 
and the plaintiff would not say in which sense he understood 
it — in truth he evaded that question. The action was for 
damages, and it failed. If the action had been for rescission 
of contract the result would probably have been the same, for 
the plaintiff would have still failed to prove that he had been 
misled b}^ the statement (q). 

It is not, however, necessary for the person who seeks False ; staten)ent 

' * not the sole 

redress on the ground that he has been induced to take shares inducement to 
by a false statement to prove that such statement was the sole 
inducement which led him to apply for shares ; it is sufficient 
for him to prove that the mis-statement materially tended to 

(»>) See Puhford v. Richards, 17 (n) 10 Eq. 73. 

Beav. 87, and cases of that class, (o) See infra. 

noticed infra; Hallows v. Fernie, 3 (p) 9 App. Cas. 187, and 20 Ch. 

Ch. 467, and 3 Eq. 520 ; Smith v. D. 27. 

Chadwick, 9 App. Cas. 187, and 20 (q) Lord Bramwell thought this 

Ch. D. 27, as to several of the was proved, but that there was no 

grounds relied on. fraud on the part of the defendant. 


Bk. I. Chap. 3. induce him to do so (r). In Edqinqton v. Fitzmaurice (s) a 
Sect. l. . / ' w 

- person relied on a mis-statement in the prospectus, but he was 

Fitzmaurice. also influenced by a mistake of his own ; he was nevertheless 

held entitled to redress. 

Opportunity of A person who makes a statement to another in order to 

truth not ° induce him to act upon it' cannot complain if the statement 

material. j g Relieved without further inquiry. The person making 

the statement may guard himself by saying that it must not 

be taken as true without inquiry ; he may refer to others, or to 

books or documents, and leave the person with whom he is 

dealing to act on his own judgment (t). But unless this is 

done, the person to whom the statement is made is entitled to 

believe it and act upon it ; and if it is false he is entitled to 

redress, although he might have found out the truth without 

much trouble or expense («). 

Unless all the above-mentioned requisites are established, a 

person who complains that he has been induced to take shares 

in a company by misrepresentation is without redress of any 

kind. But if he can establish them he will be entitled to 

redress of some sort either against the company or against the 

persons who made the misrepresentations, or against both 

them and the company, as the case may be, and as will be 

now explained. 

(n) Tn rescind If he can show that the mis-statements have been made under 

such circumstances as to be imputable in point of law to the 

company (x), and he has obtained his shares directly from the 

company, he can rescind his contract and repudiate his shares, 

and obtain back from the company whatever money he may 

have paid to the company in respect of them ((/), and further 

7LL • SW^ I, ^^L^ {ryPeek v. Derry, 37 Cli. D. 541 ; & F. 232; and see Redgrave v. 

JL^aU &*— 1 i^xU. Western Bank of Scotland v. Addie, Kurd, 20 Ch. D. 1. 

L. E, 1 H. L. (Sc), pp. 158 & 162 ; (u) See Peek v. Derry, 37 Ch. D. 

Nicol's case, 3 De G. & J. 387 ; 541 ; Baidins v. TVickham, 3 De G. 

Clarke v. Dickson, 6 C. B. N. S. 453 ; & J. 304, and 1 Giff. 355. 

Cleveland Iron Co. v. Stevenson, 4 (.>•) See as to this, infra, book ii. ; 

Fos. & Fin. 437. Nicol's case, 3 De G. & J. 387 ; 

(s) 29 Ch. D. 459, an action fur Mixer's case, 4 ib. 575, noticed infra. 

damages. (y) Kisch v. Central Bail. Co. vf 

(t) As in Jennings v. Broughton, Venezuela, 3 De G. J. & Sm. 122, 

17 Beav. 234; and 5 De G. M. & and L. E. 2 H. L. 99, and others 

G. 126; Attv;ood v. Small, 6 CI. of that class referred to below. 


compel the company to indemnify him against loss (:). More- ,:k - '■ r| "i'- -• 
over, to entitle him to this relief, it is nol necessary to prove - 
that the statements were false to the knowledge of those who 
made them (a). 

With respect, however, to the repudiation of shares, two Loss of right to 
points must be borne in mind, viz. : (1.) The right to repudiate 
will be lost if not promptly asserted after the factsare known, or 
might have been known, if reasonable diligence had been exer- 
cised (b) ; and a fortiori will be lost if the shareholder has so 
acted after he knew the facts as to have elected to keep the 
shares, and to have waived his right to repudiate them. (2.) The 
right to repudiate by any registered shareholder in a company 
being wound up, cannot be exercised after the commencement 
of the winding up of the company (c). This last doctrine 
turns on the provisions of the Companies act, 1862 ; and the 
cases under the older winding up acts in which shares were 
repudiated after the commencement of winding up proceedings, 
although valuable as illustrations of principles, are no longer 
authorities on the right to repudiate after winding up has 

If the person defrauded cannot prove all that is necessary to (*>) To recover 
repudiate his shares, or if he has lost his right to repudiate 
them, he may still be entitled to damages against those who 
issued the prospectus. But in order to entitle him to this 
relief, he must prove not only that the statements were untrue 
when made, but were untrue to the knowledge of the defen- 
dants, or at all events that the defendants, in publishing the 
statements acted recklessly, and without having reasonable 
grounds for believing them to be true (d). 

The person aggrieved may both repudiate his shares and 
obtain damages if he can prove what is necessary to entitle him 
to this double relief. 

(z) See Newbigging v. Adam, 34 (6) Sheffield's case, Johns. 451, and 

Ch. D. 582, and 13 App. Ca. 308. others of that class noticed infra. 

(a) Smith v. Reese River Co., L. R. (c) Oakes v. Turquand, L. R. 2 H. 

4 H. L. 64, 2 Ch. 604, and 2 Eq. L. 325 ; Kent v. Freehold Land, dr., 

264 ; Arhvright v. Ncicbold, 17 Ch. Co., 3 Ch. 4.93, and 4 Eq. 588. 

D. 301 ; Redgrave v. Hurd, 20 Ch. (d) See Peek v. Berry, 37 Ch. D. 

1). 1. See Pollock on Contracts, 541, and the cases referred to below, 

cc. 9 and 10. See Pollock on Torts, 236 et seq. 

>ee ronocK on rorts, ei seq. , . n 


Bk. I. Chap. 3. With respect to actions for damages against companies as 
— distinguished from actions for rescission of contract and 

damans against indemnity, there is always the difficulty of establishing fraud 
ths company, j a g a i ns t the company as a body. Many eminent men consider 
that on principle a corporate body cannot commit a fraud, and 
that consequently an action for fraud can never be maintained 
against an incorporated company ; but the current of authority, 
and in the author's opinion sound principle also, are opposed to 
this view, and are in favour of such actions being maintainable. 
This difficult subject will be discussed hereafter (Bk. II., c. 3, 
§ 3). It is however settled that such an action (or its equivalent, 
viz., a claim for damages) cannot be supported against a com- 
pany which is being wound up (e). 

This doctrine is based upon the winding-up provisions of the 
Companies act, 1862, and upon the rights of creditors under 
winding-up proceedings, and has no application to actions 
against companies not being wound up, nor to actions against 
individual directors or other persons. 

Having now stated the general principles applicable to the 
subject under consideration, it will be useful to notice some of 
the more important decisions illustrating, (1) The right to relief 
against the company by way of rescission of contract and 
indemnity ; and (2) The right to redress against the indi- 
viduals who have been guilty of fraud. 

2. Remedy against the Company. 

Kisch v. Central In Kisch v. Central Railway Company of Venezuela (/), the 
SS'rfW prospectus in effect stated, (1) That the company had obtained 
zue!a - a concession from a foreign government ; (2) That the con- 

tractor had guaranteed a dividend of two-and-a-half per cent, 
on the paid-up capital during the construction of the works ; 
and (3) That the foreign government had guaranteed a divi- 
dend of nine per cent, on the paid-up capital for twenty years. 

(c) Houldsworth v. City of Glasgow these decisions. 

Bank, L. R. 5 App. Cas. 317. See (/) 3 De G. J. & Sm. 122 ; aff. 

also Cargill v. Bower, 10 Ch. D. 502. L. R. 2. H. L. 99, under the name 

Observe that these are cases of de- Directors of Central Bail. Co. of 

frauded members. Claim- fur frauds Venezuela v. Kisch. 
on other persons are not affected by 


The real facts were (1) That the company had for a large sum Bk. I. Chap. 3. 

bought a concession made to another company; (2) The con- 
tractor's guarantee was limited to 20,000/., the capital of the 
company being 500,000*. ; (8) The government guarantee only 
came into operation in the event of the company failing, 
without any default of its own, to realise a profit of nine per 
cent, on its paid-up capital from its business. The memo- 
randum of association empowered the company to purchase 
concessions, and the agreement for the purchase of the con- 
cession already obtained by others was referred to in the com- 
pany's articles, but was not disclosed in them. The Court 
held that the misrepresentations in the prospectus were such 
as to entitle a person taking shares on the faith of it to rescind 
his contract, although he was not entitled to rely upon his own 
ignorance of the memorandum and articles of association, and 
of wdiat was there disclosed. 

In Smith v. Reese Hirer Company (g), the prospectus de- Smith "■ Re "^ 
scribed some silver mines abroad which the company had ^^ Company * 
contracted for, and proposed to work as extremely valuable, 
whereas in fact they were wholly worthless, and were after- 
wards given up by the company for others, which were more 
promising. The directors who issued the prospectus did not 
know that the mines referred to in the prospectus were worth- 
less, they having themselves been duped ; but the Court held 
that a person who had taken shares on the faith of the pro- 
spectus was entitled to rescind his contract, and to have the 
company restrained from suing him for calls (A). 

In Ross v. Estates Investment Company (/), a prospectus R°*s »■ 
was issued by the directors of a company after its formation, 1 q2^T 
and the prospectus stated, falsely, that half the first issue of 
shares had been already subscribed for, and that the company 
had contracted for the purchase of two properties, on one of 
which the vendor had already spent 70,000/. A person who 
had been induced to take shares in the company on the faith of 
this prospectus, was held entitled to rescind his contract, to 

{[)) L. R. 4 H. L. 64, 2 Oh. 004, directors that their statements were 

and 2 Eq. 261. false, ante, p. 73. 

(h) See, as to the immateriality (I) L. R. 3 Eq. 122, aff. 3 C'li. 

of knowledge on the part of the 683. 



Bk. I. Chap. 3, 
Sect. 1. 

Henderson v. 

Fraud not 

Private arrange- 
ments by pro- 

Pulsford r. 

recover from the company the money he had paid to it for the 
shares, to have his name removed from the register of share- 
holders, and to have the company restrained from suing him 
for calls. 

In Henderson v. Lacon (/.), the prospectus stated, falsely, 
that the directors and their friends had subscribed a large 
portion of the capital ; and a shareholder who had applied for 
and obtained shares on the faith of this prospectus was held 
entitled to repudiate his shares and to have his money back, 
and to have his name removed from the register of members, 
and to be indemnified by the directors. 

Moreover, in such cases as these, the plaintiff is entitled to 
relief, although a petition to wind up the company may be 
presented after action brought (/). 

These cases may be conveniently contrasted with the follow- 
ing, in which the misrepresentation relied upon was held not to 
be sufficiently material, or not to have been relied upon by the 
plaintiff so as to entitle him to relief. 

In Pulsford v. Richards (tn), the projectors of a Belgian 
railway issued a prospectus for the formation of a company, 
stating that they transferred to the company the concession 
obtained from the Belgian government, and all the benefits 
arising from it, subject to certain specified reservations in 
favour of the promoters for reimbursement of preliminary 
expenses. The plaintiff, acting on the faith of this prospectus, 
applied for and accepted shares in the company, but afterwards 
filed a bill against the projectors for a return of all monies 
paid by him in respect of such shares with interest, offering 
to return the shares and all dividends received on account of 
them. The grounds on which the plaintiff sought to rescind 
his contract were substantially — (1) that an arrangement 
had been made by the promoters with an engineer, highly 
beneficial to him and detrimental to the company, and that 
this arrangement was in no way alluded to in the prospectus ; 
and, (2) that the promoters had appropriated to themselves 

(k) 5 Eq. 249. mann v. European Central Rail. Co., 

(1) Smith v. Eeese Hirer Co., and 7 Eq. 154; Kennedy v. Panama, d-c., 

Henderson v. Lacon, vbi supra. Mail. Co., L. R. 2 Q. B. 580. 
(m) 17 Beav. 87. See, also, Hey- 


20,000 shares in the company, in addition to the benefits Bk.I. Chap. 3. 
expressly reserved to them in the prospectus. The Court, 

Fulsford v. 

however, held that there was no such fraud as was sufficient to Richards. 
enable the plaintiff to rescind the contract into which he had 
entered, and his bill was dismissed with costs. As regards 
the shares, the Court was of opinion that the directors took 
the shares bond fide, and that the number of shares allotted 
l>3 r them to themselves and the engineer, was not a fact so 
material, that the knowledge of it was a matter which the 
directors were bound to communicate to the public, in order 
to enable them to come to a sound conclusion as to the 
probable success of the undertaking in which they were 
invited to take a part. As to the concealed arrangement with 
the engineer, the Court came to the conclusion that the ser- 
vices performed and to be performed by him, must have been 
performed by some one ; that he was peculiarly well fitted 
to perform them ; that supposing the remuneration agreed 
upon to have been excessive, still that would only entitle the 
shareholders to have the amount of excess paid by the direc- 
tors themselves, and that the non-disclosure to the public of 
the agreement made with the engineer, was not the suppres- 
sion of a fact which affected the intrinsic value of the under- 
taking, or consequently afforded a sufficient ground for a 
rescission by the plaintiff of his contract to take shares in the 

In Jennings v. Browjhton (//), the plaintiff, who had taken Statements not 

.... „ relied on by 

shares in a mining company formed by the defendants, sought plaintiff. 
to rescind the contract on the ground that he had been induced Jennings v. 


so to do, by their representations. The misrepresentations 
consisted of exaggerated statements, as to the value and 
prospects of the mine, contained in the report of an engineer 
employed by the defendants, and which report was submitted 
by them to the plaintiff. The plaintiff, however, did not alto- 
gether rely on this report, but went and examined the mine 
himself more than once, before he purchased the shares in it. 
The mine had undoubtedly been described in too glowing 

(n) 17 Beav. 234, and 5 De G. the plaintiff also relied on his own 
M. & G. 126. See, also, Attwood judgment, 
v. Small, G CI. & Fin. 232, where 



Prospectus not 
relied upon by 

Robson v. 

Bk. I. Chap. 3. colours, and it bvno means came up to the expectations formed 

Sect. l. ' J l L 
of it ; but the Court was of opinion, upon the evidence, that the 

plaintiff had not relied on what was represented to be actually 
existing, that he not only had had the same means as the 
defendants of ascertaining the truth, but that he had availed 
himself of those means, and that his deception was as much 
owing to his own error of judgment as to anything else. His 
bill therefore was dismissed, and with costs, and an appeal by 
him was also dismissed. 

In Robson v. The Earl of Devon (o), the plaintiff, a stock- 
broker, was induced by the secretary of a company, first to 
advance him 500/. on the security of 1000 1/. shares, on each 
of which 1/. was certified to have been paid up ; and secondly, 
to purchase 1200 other shares. On the failure of the company, 
the plaintiff sought to have both transactions declared void, 
and to obtain back from the company his 500/., and the money 
paid for the purchased shares. The plaintiff rested his case 
against the company upon the following, amongst other 
grounds, viz. : First, that the company's prospectus showed 
that no shares ought to have been issued before a certain 
amount of capital had been subscribed ; and secondly, that 
nothing had ever been paid in respect of the shares on which 
the 500/. had been advanced. But it was held that the 
plaintiff was entitled to no relief on either of these grounds. 
For, first, it was by no means clear that the capital required 
by the prospectus to be subscribed, had not in fact been 
subscribed ; secondly, the plaintiff had not parted with his 
money on the faith of the prospectus, so that it was im- 
material to consider what w r as there stated ; and thirdly, 
the shares on the security of which he lent his money, were, 
as between the holder and the company, to be taken as 
paid-up shares, and therefore it was of no consequence to 
the plaintiff, whether anything had actually been paid upon 
them or not. 

Although the cases under the older winding up acts, in which 
persons induced by fraud to take shares in a company were held 
not to be contributories, can no longer be relied upon where the 

(o) 3 Jur. N. S. 567, and 4 ib. 245. 


point for determination is contributory or non-contributory, l;k - '• Cha P- 3 - 

. Sect. 1. 

those cases throw great light on the questions discussed in this 
chapter, 'and the following notice of them may still prove 

1. Persons held entitled to repudiate their shares, having ban 
induced t<> take them by the fraud <>/' tli<- company. 

Ginger's case(p) i> an important Irish case, decided in winding up the dinger's case. 
Tipperary Bank. In that case the managing director of the bank, acting 
without authority, and in violation of the bank's deed of settlement, issued 
a number of shares, entered them in the share register book in the name of 
A., and debited him with their price. Of this proceeding A. was ignorant. 
In order to induce persons to take these shares, the director issued a 
flourishing report, prospectus, and balance-sheet, in which there was not a 
word of truth ; he placed these documents in the hands of a friend, wdio did 
not know them to be false, and induced him to endeavour to sell the shares. 
The friend in question employed agents equally innocent with himself, to 
induce people to take shares, and such agents were furnished with the false 
and fraudulent documents above alluded to. < ringer was induced by one of 
these agents, and by the false documents produced by him, to purchase 
shares ; and A. was induced by a trick on the part of the director to sign 
transfers to Ginger, who accepted the shares, and was registered as a share- 
holder in respect of them. Ginger was held not to be a contributory : first, 
because the shares transferred to him ought never to have been issued or 
transferred to him at all (q) ; and secondly, because he was induced to pur- 
chase them by a gross fraud, imputable to the company. Upon the question 
of fraud it was considered, that if shareholders choose to adopt, and seek to 
enforce, the contract of a director, and say that he was their authorised agent 
to enter into it, they cannot repudiate the frauds of the agent which led to 
the contract, and which are immediately connected with, and the foundation 
of, the very transaction which is sought to be enforced. 

BrockwelVs case (r), which arose in the course of winding up the Royal Brockwell 3 
British Bank, was substantially as follows : The bank was formed in 1849 
under 7 & 8 Vict. c. 113. Annual reports were made by the directors to the 
shareholders, and such reports were from the very first false, to the know- 
ledge of most, if not of all, of the directors. In December, 1854, the company 
was hopelessly insolvent, and the directors knew it. They nevertheless 
prepared a report, and laid it before a general meeting of shareholders, held 
in February, 1855, and in such report represented the company to be in a 
nourishing condition. In this same month the directors, by false represen- 
tations as to the state of the company, induced the Board of Trade to grant 

(p) 5 Ir. Ch. Rep. 174. shares issued without authority and 

(q) But see, as to this, Richmond's fraudulently, was held a contri- 

case and Painter's case, 4 K. & J. butory. 

305, where a person who had taken (r) 4 Drew. 205. 



Observations on 
these cases. 

Bk. I. Chap. 3. the company a supplemental charter, and to authorise the increase of its 
&ect- • capital by the issue of new shares. The report made to the shareholders in 
February, 1855, was advertised in the newspapers, and was to be seen at the 
company's office, and there Mr. Brockwell saw it. Upon the faith of this 
report he took shares in the company from the company itself ; he paid up 
his capital and received dividends. In September, 1855, the company was 
ordered to be wound up. The frauds committed by the directors, and the 
falsity of their reports and representations, were then discovered. It was 
admitted that Brockwell would have been a contributory had there been no 
fraud ; but it was contended on his behalf, and held, that he had been in- 
duced to take shares in and from the company by the fraud of the company 
and that he was therefore not a contributory, and his name was struck off 
the list, with costs to be paid by the company. 

These cases are frequently regarded as inconsistent with, and in effect 
overruled by Nicol's case(s) ; indeed the V.-C. Kindersley, who decided 
BrochwelVs case, appears himself to have regarded it as overruled (t). But 
all that Xicol's case decided was, that a company could not be affected by 
the use one of its directors might make of a report which had been laid 
before, and adopted by a meeting of shareholders («). In so far as Ginger's 
case and BrochwelVs case are opposed to this decision, they may be considered 
as overruled by it ; but the broad principles on which they proceeded may^ 
it is conceived, still be relied upon, and have been recognised and acted upon 
in other cases. 

BelVs case (.<•). In this case the secretary of a company had, by the autho- 
rity of its directors, issued circulars in which the affairs of the company 
were falsely and fraudulently represented to be in a flourishing state. Such 
circulars were issued for the purpose of inducing the public to take shares. 
Mr. Bell took shares on the faith of the statements contained in the circulars- 
He obtained such shares directly from the company, which was shortly 
afterwards ordered to be wound up. The fraud which had been committed 
was then discovered, and Mr. Bell repudiated his shares. He was held not 
to be a contributory, although he had executed the company's deed. 

Ayre's casc(y). In this case The Deposit and General Life Assurance 
Company was desirous, in March, 1854, of issuing new shares. The com- 
pany had a manager in London and an agent in Bristol. The Bristol agent 
applied to Mr. Ayre to take shares, and produced to him the company's deed 
of settlement, also a list of the original -shareholders, who were described as 
holding 10,550 shares, and as being persons of considerable property, and 
also a report made by the directors of the company, and representing the 
affairs of the company to be in a flourishing state. This report was false. 
The list of shareholders also contained many material false statements. The 
documents shown to Mr. Ayre had been sent from London for the express 
purpose of being laid before him ; and on the faith of those documents, and 
of the statements made to him both by the company's London manager and 

Bell's case. 

Ayre's case. 

(s) 3 De G. & J. 387, infra, See, (;/) Infra. 

also, Mixer's case, 4 ib. 575. (x) 22 Beav. 35. 

(f) Barrett's case, 2 Dr. & Sm. 415, (;/) 25 Beav. 513. 


by its Bristol agent, Mr. Ayre was induced to hike- 200 of the new shares, Bk, I. CTiap 3. 
and to sign the company 'a deed in respeel thereof. Be afterwards, however, 

id reason to suspect thai he had beer imposed upon, and he then repudiated 
his shares and refused to pay a call made upon him. He further defended 
an action brought against him for such call, pleading fraud as a defence to 
the action ; at the trial, however, the evidence adduced by him to prove the 

fraud was not satisfactory, and the company obtained a verdict, and lie was 
compelled to pay the amount of the call, together with interest and costs. 
On the subsequent winding up of the company he succeeded in establishing 

the facts already mentioned, and it was accordingly held that he was not a 
contributory, and that the verdict of the jury was not conclusive upon the 
question of fraud. The judgment on this question deserves attentive perusal, 
and is an authority for the [imposition that companies cannot be heard to 
say they did not know that their own reports were untrue. 

Blake's casi (.). There the secretary of the company sent to its brokers Blake's 
prospectuses of the company for distribution. The prospectus represented 
that several persons were directors of the company. The brokers were in- 
formed by the secretary that the shares taken by the directors and others 
exceeded the number set apart for person- in L mdon and the neighbour- 
hood, and that the London share list was closed ; but that shares might still 
lie had by person- residing in the country, and applying through country 
brokers. Advertisements to this effect were also published in the n< 
papers. This information was conveyed by the brokers to Blake, to whom 
they st-nt a prospectus. He bought some shares in the company on the 
faith of the above statements ; but his suspicions being aroused by the low 
numbers on the scrip certificates sent to him, he made inquiries and dis- 
covered that the London share-list was still open, and that there was no 
difficulty in obtaining shares in London, and that three out of the eleven 
directors named in the prospectus had no shares in the company. Blake 
immediately repudiated his shares, and demanded back the money he had 
paid for his shares ; and it was returned to him, and a line was drawn 
through his name on the register. Two calls were afterwards made, but he 
was not retpuired to pay either of them. On the subsequent winding up of 
the company, he was held not a contributory. The decision proceeded on 
the ground— 1, that Blake had been induced by fraud to apply for shares, 
and that such fraud affected the company ; and 2ndly, that he had repudiated 
the shares as soon as he had discovered the fraud, and such repudiation had 
been acquiesced in by the company. 

2. Persons held not entitled to repudiate their shares, 

a) Fraud not imputable to the company. 

Even where a person has taken shares in a company on the faith of a false Fraudulent 
and fraudulent report of the directors of the company, he will nevertheless re P 0lts - 
be unable to repudiate his shares if such report was not issued or published 

(z) 34 Beav. 320. 
L.C. G 



Bk. I. Chap. 3. by the directors, or by their authority, in order to induce persons to take 
Secfc - lj shares in the company. The unauthorised production of such a report 
to a person in order to induce him to take shares in the company, is not 
such a use of the report by the company as to render the company guilty of 
a fraud upon him, even although the report may have been produced to him 
by a director or some officer of the company. 

The leading authority on this head is Nicol's case, which maybe regarded 
as an appeal from the decision in BroclacelVs case (<<). 

Nicol's case. ^ n Nicol's case (b), Nicol had taken shares in the Royal British Bank, in 

March, 185"), on the faith of the same reports as had induced Brockwell to 
take his. Brockwell had seen the reports at the Bank. Nicol Avas shown 
them by a director, who made additional statements as to the nourishing 
condition of the bank. The Yke-Chaneellor held Nicol not to be a con- 
tributory, he having been induced, by the fraud of the company, to take 
the shares in question. The Lord Chancellor dissented from this view, and 
expressed a strong opinion that companies are not responsible for the frauds 
of their directors ; the Lord Justice Knight Bruce was not satisfied that the 
Vice-Chancellor's view of the case was correct ; and the Lord Justice 
Turner, although differing in many respects from the Lord Chancellor, 
agreed with him in thinking that Nicol, having had no communication 
with the directors as a body, but having dealt with one of them only, was 
not in a position to say that lie had been defrauded by the company. The 
whole Court, however, agreed that Nicol's name ought to be struck off the 
list of contributories, he having effected a valid transfer of his shares. 

Holt's rase. Holt's case (d). The managing director of a company induced Holt to 

become a director, to take shares, and to sign the company's deed, by 
misinforming him as to the position and prospects of the company, 
and producing a flourishing but false prospectus. Holt was held a 

Barrett's case Again, it was decided by the V.-C. Kindersley in Barrett's case(e), that 

where directors made a false report to a meeting of shareholders, and the 
meeting adopted the report, and it was afterwards sent to each shareholder, 
no shareholder could treat that report as a fraud by the company on him- 
self. Consequently a shareholder who, on the faith of such report, applied 
for and obtained more shares in the company, was held to be a contributory 
in respect of them. 

In the following cases, persons who had been induced to take shares in a 
company by the fraud of some individual connected with the company, were 
held not to be entitled to repudiate their shares. After what has preceded 
they will be found to offer little difficulty. 

Bernard's case. Bernard's case(f). Bernard, being desirous of purchasing shares in a 

(a) 4 Drew. 205, ante, p. 79. 
(h) 3 De G. & J. 387. See, also, 
Mixer's case, 4 ib. 575. 

(d) 22 Beav. 48. See, too, Bigge's 
case, 5 Jur. N. S. 7, infra, p. 84. 

(e) 2 "Dr. & Sm. 415, and 3 De G. 
J. & Sm. 30. 

(/) 5 De G. & S. 283. The fraud 
here consisted in the payment of 
dividends out of capital, rather than 
in the statement of the manager. 
The Court does not seem to have 
been satisfied that there was any 
dolus dans locum contractu!. 


company, applied to the manager for information as to it.- circumstances, Dk. I. Chap, o.: 

ami was told, amongst other things, that dividend were being paid. He *" *• 

took fifty shares, which were in fa-;t, although he did nol know it, issued 

by the directors. He received dividends for three years, and was held 

a contributory, although the company was insolvent when he took the 


Gibson's case (g). In this case Gibson had been induced by a promoter of Gibsons case. 
a company to take shares in it, and to sign its deed of settlement in respect 
of such shares, upon the assurance of the promoter that two other persons 
would do the same These two persons, however, refused to join the com- 
pany, and Gibson then repudiated his shares. He was afterwards informed 
by tin- promoter, with whom he had dealt, that such shares had been trans- 
ferred, which, however, was not true. Gibson was held to be a contributory. 
in this case there was in truth no fraud inducing him to take shares; for 
the persons who were stated to be willing to sign the deed and become 
directors were at the time believed to he willing to do so. Further, there 
was nothing to show that the promoter, with whom alone Gibson dealt, 
ever acted otherwise than in his individual capacity. 

IVoollastotfs caseQi). Dr. Woollaston was requested by one of the direc- Woollaston's 
tors of an insurance company to become one of its medical referees, and '' a ~''' 
was told that there would he only two. l>r. Woollaston applied for the 
appointment, and his application was accepted. The appointment appears 
to have been made without qualification, but to have been confirmed upon 
the condition that the appointee should Bign the company's deed for 200 
shares, and that the appointment should date from the day on which lie 
signed it. The secretary of the company assured Dr. Woollaston that only 
two referees would be appointed ; thai every oliicer of the company had 
200 shares in it ; and that lie must take a like number. On the faith of 
these representations Dr. Woollaston signed the deed for 200 shares. He 
acted for the company for some little time, but having afterwards discovered 
that two other referees had been appointed, he tendered his resignation, and 
demanded back the money he had paid for his shares. This demand, how- 
ever, was not complied with. The statement made by the secretary as to 
the number of shares held by the other officers of the company was false ; 
but it was held that there was no such fraud as to relieve Dr. Woollaston 
from his liability to be a contributory. 

Ex parte Worth {i). In this case the shareholders of a company had Ex parte Worth. 
resolved on issuing preference shares, which they had no right to do. A 
certain number were taken by a director, and he sold some of them to a 
lady, who accepted them, and signed the company's deed in respect of them. 
She was held to be a contributory, for there had been no dealing whatever 

(g) 2 De G. & J. 275. Kemp's not a contributory, his shares having 
case, and Hudson's case, reported in been forfeited, 
the same place, are not distinguish- (i) 4 Drew. 529, as to shares pur- 
able from Gibson's. chased from shareholders, and not 

(h) 5 Jur. N. S. 617, affirmed on obtained directly from the company, 

the point of fraud, 4 De G. & J. 437. see the next page. 

On appeal, Dr. Woollaston was held 

o 2 



Ek. I. Chap. 3. between her and the company ; she was not induced to take any shares by 
Sect. 1. an y representation made to her by the company, or made by the company 
to the public, and which she had a right to take advantage of as one of the 

FrowcVs case (k) is another case of the same class. Frowd was induced to 
take shares by the representations of one of the company's clerks, and was 
held a contributory. 

Sheffield's case (?) may be referred to as an authority, to the effect that a 
person who takes shares in a company, and signs its deed, is a contributory, 
although the effect of that deed may have been misrepresented to him by 
the officers of the company. 

Frowd's case. 

Sheffield'- cas« . 

Case of person 
buying shares 
from a share- 

h) Fraud by a person not a party to the contract. 

[nasmuch as a contract between two persons cannot be rescinded by 
either on the ground that lie was induced to enter into it by the fraudulent 
representations of a stranger, it follows that if a shareholder in a company 
sell his shares to a person who accepts them, and is accepted by the com- 
pany as a shareholder in respect of them, the purchaser will be unable to 
repudiate his shares, although he may have been induced to buy them by 
false and fraudulent reports issued by the directors of the company (m). 
The fraud of the company is not imputable severally to each of the persons 
composing it ; and the purchaier cannot, therefore, repudiate his shares on 
the ground that he was induced to take them by the fraud of the seller. 
This explains several cases in which purchasers of shares in companies pay- 
ing large dividends when they were in fact insolvent, have, nevertheless, 
been held to be contributories (a). 

Case of person 
not induced to 
take shares by 
the fraud in 

Bigge's case. 

c) Fraud of tin: company not the cause of the contract. 

Although fraudulent reports may have been issued and published by the 
directors of a company, no person can rely upon them as a ground for 
repudiating shares taken by him in it, unless he was induced to take the 
shares by such reports. Bigge's case (o) may be usefully referred to on this 
head. There a young man of the name of Bigge, having money and nothing 
to do, was induced by his uncle and friends to become a director of a com- 

(/.■) 9 W. E, 328. 

(/) Johns. 451, and infra. See, 
too, Blackburn's case, 8 De G. M. & 
G. 177 ; Conybearev. Neic Brunswick, 
&c,Co., 7 H. L. C. 711. 

(m) Durantifs case, 26 Beav. 182 ; 
Ex jxuie Worth, 4 Drew. 529 ; 
Sanderson's case, 3 De G. & S. 66 ; 
Ex parte Oakes and Peck, 3 Eq. 576 ; 
and see the next note. 

(n) Biggt's a se, 5 Jur. X. S. 7; 

Barnes v. Pennell, 2 II. L. C. 497. 
Bernard's case, 5 De G. & S. 283, is 
partly but not wholly explicable on 
this principle, for fifty of the shares 
in respect of which Bernard was a 
contributory, were issued by the 

(o) 5 Jur. N. S. 7. See, too, 
Longworth's case, 7 AY. It. 483, where 
the shares were taken before the 
fraud was committed. 


pany. He was told that to <lo BO he must take a certain number of shares Bk. I. Chap. 3. 

in it. His uncle was himself a director, and transferred to him the neces- ^ eot - *• 

sary number of shares. The company was paying dividends ; it had issued 

reports which contained untrue representations of the state of its affairs ; 

and it was, in fact, insolvent. But the shares were not taken on the faith of 

these reports, nor upon the faith of any representations attributable to the 

company, and Bigge was therefore held to be a contributory (j)). 

d) Shares not repudiated when fraud vms discovered. 

A person induced to take shares in a company by the fraud of the com- Effect of not re- 

pany, will be unable to repudiate them if, knowing or having the means of l JU,Jlatin S sl)ares 
.. • , . , on discovery of 

discovering the fraud, he nevertheless continues to hold his shares. A fraud. 

leading case on this head is Sheffield's case (q). 

There a person had been induced to take shares in a company, on the 
assurance of its manager and its cashier that no risk would be incurred if 
he paid up his shares in full. He accordingly took shares, signed the com- 
pany's deed, and paid up his shares in full. The deed, when he signed it, 
contained a clause limiting the liability of the shareholders to the amount 
of their unpaid-up capital. This clause had been fraudulently inserted in 
the deed, so as apparently to form part of it, and was fraudulently withdrawn 
from the deed before it was registered. He, however, never read the deed. 
The company carried on its business for several years, and the shareholder 
in question, who had never had his attention called to the difference between 
the deed as registered and the deed as signed by him, received dividends 
and attended meetings as a shareholder. After the lapse of more than four 
years, the company was ordered to be wound up, and it was then that the 
fraud above mentioned was discovered. The shareholder contended that he 
had never become a shareholder in the registered company ; or that if he 
had, he had been induced to become so by the fraud of the company. But 
it was held that it was not open to him to say he did not know the contents 
of the registered deed ; that other people were entitled to say they had 
acted on the faith of it ; and that he could not escape from being made a 
contributory (r). The shareholder in this case was held liable, mainly upon 
the ground that he might have known, and, in fact, was bound to know, 
the contents of the registered deed. Treating him, therefore, as acquainted 
with those contents, although ignorant of the fraud which had been perpe- 
trated, his acts amounted to an adoption of shares in the registered company. 

(|>) See, too, Sanderson's case, 3 and Ashley's case, ib. 263. 

De G. & S. 67, and 3 H. L. C. 698, (/•) Other persons who had signed 

where the company accepted a pur- the deed whilst the limited liability 

chaser of shares as a shareholder, clause was part of it, were held not 

although it was on the eve of bank- to be contributories; but the cir- 

ruptcy. cumstances distinguishing their cases 

(q) Johns. 451. See, too, Mixer's from Sheffield's do not appear. See 

case, 4 De G. & J. 575 ; Ex parte CoxJs case, and Naijlors case, men- 

Briggs, 1 Eq. 483; Scholeyv. Central tioned in 4 K. & J. 314. 
Railway Co. of Venezuela, 9 Eq. 26Gn., 



13k. I. Chap. 3 
Sect. 1. 

Sheffield's case. 

The only question which could then arise would he, whether he was entitled 
to be indemnified by the company against loss, he having been told by the 
manager and one of the directors, that he would not be liable beyond the 
extent of his paid-up capital. Such a statement as this, however, could not 
affect the company ; for, so far as the statement was true, it added nothing 
to what might have been learnt from the deed itself ; and so far as it was 
false, it was made by persons who certainly were not the agents of the 
company to explain the legal effect of its deed of settlement. 

Effect of person 
taking shares on 
the faith that 
others are 


Painter's case. 

Parbnry's case. 

e) Effect of •persons taking shares on faith of others being shareholders. 

If a shareholder has been induced to take shares in a company by the 
fraud of the company, and since he took such shares other persons have 
taken shares on the faith of his being a shareholder, there are three 
alternatives, viz., 1, to hold that he, and consequently they, are entitled to 
repudiate their respective shares ; 2, to hold that they, and consequently he, 
must be treated as shareholders ; 3, to distinguish between his case and 
theirs, and whilst holding him at liberty to repudiate, to hold them bound. 

Of these alternatives the last was adopted in Richmond's case and Painter's 
case (s). There persons had been induced to take shares in a company, the 
deed of settlement of which was materially altered after they had signed it. 
Other persons had taken shares in the same company, and had executed the 
deed in the state in which it ultimately remained, and whilst the j)ersons 
first referred to were shareholders. The first set of shareholders were held 
not to be contributories ; but the second set were held to be contributories, 
although it was contended on their behalf, that they had only agreed to 
join a company in which the first set were shareholders in reality as well as 
in appearance. 

Upon this case it is to be observed that there was no evidence showing 
that in point of fact the second set of shareholders had been induced to take 
shares in the belief that the first set were shareholders ; for it does not 
appear that the shareholders held to be contributories, knew who, in parti- 
cular, had signed the company's deed before they signed it themselves. If 
the facts had in this respect been different, Sheffield's case goes far to show- 
that all the persons defrauded would have been contributories (t). 

Such cases as those last adverted to must not be confounded with Par- 
bury's case(u), in which it was held that a person induced to take shares in 
a company on the faith of its prospectus, which contained false and fraudu- 
lent statements, was nevertheless a contributory, inasmuch as it was reason- 
able to suppose that there were other persons, equally innocent with himself 
and with whom, therefore, he was liable to contribute. Now it is conceived 
that if these other persons had, like himself, been induced to take shares on 
the faith of the company's prospectus, the only consequence would be that 
they and he might all have repudiated their shares. If in such a case some 
of those deceived do not choose to exercise their right of repudiation, that 

(s) 4 K. & J. 305. 
(t) Ante, p. 85. Compare t the 
judgments in Gibson's rase, 2 De G. 

& J. 284 ; Bell's case, 22 Beav. 35 
BrockwelVs case, 4 Drew. 214. 
(u) 3 De G. & S. 43. 


ought not to prevenl the others from so doing, [f 100 persons have been Dk. I. Chap, 3. 
equally cheated, and ninety-nine of them are content to abide by their Sect - *• 
bargain, that is no reason why the hundredth should he held to his (.<•). 
Moreover, under tin' older Winding-up acts (under which Parbwry's case was 

decided), persons entitled to he indemnified by the company ought not to 
be contributories, simply because they may possibly be called upon to bear 
debts or losses, for which the company, as between them and it, is primarily 
responsible. Parbwry's case, therefore, cannot be considered satisfactory. 
But this conclusion does not render it more easy to deal with such crises as 
Richmond's and Painter's case; for, ex hypoiliesi, in them, those persons who 
are equally innocent are not in the same position relatively to each other ; 
Milne of them having become shareholders in the belief that the others had 
heroine so first. It is the right of the former against the latter which it is 
so difficult to determine, and which cannot yet be considered as finally 
settled by decision. 

3. Remedy against the individuals who made tin' statements. 

Directors and others who publish false and fraudulent reports 

with a view to induce people to take shares incur serious 

criminal as well as civil responsibility. They are liable to he Criminal 

t • / responsibility. 

indicted and convicted for conspiracy at common law (y) ; 

and they are also liable to punishment under 24 & 25 Vict, 
c. 96, § 84, which will be found in the chapter relating to 
fraudulent accounts (z). 

In the notorious case of the Royal British Bank, the 
directors were indicted and convicted of the common law 
offence of a conspiracy to induce persons to become share- 
holders in and customers of the bank by issuing false and 
fraudulent reports respecting its condition and solvency (a) ; 
and in the equally notorious case of the Eupion Fuel and Gas 
Company, the directors were indicted and convicted of a con- 
spiracy to defraud by fraudulently obtaining a settling day from 
the Stock Exchange Committee, with intent to induce persons 
to deal in shares of the company in the belief that it was duly 
formed and constituted (b). 

(x) See 4 Drew. 214, in BrockweW-i in Burnes v. Pennell, 2 H. L. ('. 497) 

case, and 3 De G. & J. 425, in Nicol's p. 525. 
case. (b) B. v. Aspinall, 1 Q. B. 1). 730, 

(y) See below. and 2 Q. B. D. 48. See, also, R. v. 

(:.) Infra, book iii., c. 3, § 4. Timothy, 1 Fos. & Fin. 30, and R. v. 

(a) R. v. Esdaile, 1 Fos. & Fin. Gurnet;, Finlaison's Report, and for 

213. See, also, per Lord Campbell obtaining money under false pre- 


Bk. I. Chap. 3. Directors and others who circulate fraudulent prospectuses 
and reports, with a view to induce people to take shares are 

ivil liability. 

answerable in damages to those who take shares on the faith of 
such reports (c) ; and an action for misrepresentation is sus- 
tainable, although the prospectus or report relied on was not 
the sole inducement to the plaintiff to take shares (d) ; and 
although there may have been no immediate communication 
between the plaintiff and the defendant (e), and although the 
defendant may have been only a servant of the company (/). 
Such an action, moreover, is sustainable in. Scotland and 
perhaps in England against executors for the fraud of their 
testator (g) . But a director is not liable for the frauds of his 
co- directors or of airy other agent of the company, e.g., for a 
fraudulent prospectus issued by them, unless he has himself 
authorised what has been done (A). 

Actions of this class are often brought on insufficient 
materials by shareholders whose expectations have been dis- 
appointed, and who seek without justice to throw the loss 
they have sustained on persons who are as innocent of fraud as 
themselves. But the law of this country is unquestionably very 
lenient to persons who act honestly, but who nevertheless put 
their names to statements on the faith of what they are told by 
others and the truth of which they too readily assume. Actions 
for negligent as distinguished from fraudulent misrepresenta- 
tions are not encouraged ; and the fiction of an implied warranty, 
which has been had recourse to in order to make agents liable 
for honest mistakes as to their own authority (/), has not been 

tences, Ii. v. Watson, 4 Jur. N. S. 117. Compare Peek v. Gurney, I. 

14 ; 24 & 25 Vict. c. 96. R. 6 H. L. 377, and 13 Eq. 7!), 

(c) Edgington v. Fit :.mau rice, 20 noticed infra. 

L4. * £U>~j „ ^JU>~ Ch. D. 459 ;*Peek v. Dcrry, 37 Ch. (/) Cullen v. Thompson, 1 McQu. 

JL^4U ^^^l. I i^M D. 541 ; Gerhard v. Bates, 2 E. & B. 424. 

476 ; Burncs v. Pennell, 2 H. L. C. (g) Davidson v. Tullock, 3 McQu. 

497. See, also, Denton v. Great 783 ; Peek v. Gurney, L. R. 6 H. L. 

Northern Bail. Co., 5 E. & B. 860 ; 377, and 13 Eq. 79 ; New Sombrero 

Williams v. Swansea Harbour Trus- Phosphate Co. v. Erlanger, 5 Ch. D. 

tees, 14 C. B. N. S. 845 ; Jury v. 73, and 3 App. Ca. 1218. 

Stoker, 9 L. R., Ir. 385. (//) Weir v. Bell, 3 Ex. D. 238, 

(«/) See ante, p. 71. noticed infra. 

(e) Clarke v. Dickson, 6 C. B: N. S. (i) Firbank's executors v. Hum- 

453 ; Bedford v. Bagshaw, 4 H. & N. phreys, 18 Q. B. D. 54 ; Chapleo v. 

538; Bedew Ckland,4 Fos. & Fin. Brunswick Building Society, 6 Q. B. 


applied to other honest mistakes, although they may have Bk - *• (, '>*P- 3. 
seriously misled and injured other people. Actions against - 
directors and others have constantly failed hy reason of the 
evidence of fraud not being sufficient (k). 

The case which goes furthest in imposing liability fur mis- Peek r. Derry. 
representations is Peck v. Perry (I). There the prospectus of 
a tramway company stated that the company had a right by 
their special act to use steam instead of horses. This was not 
true. The company were by their act authorised to use steam if 
the Board of Trade consented, but not otherwise ; and the Board 
would not consent to the use of steam except on a very small 
portion of the company's line. When the prospectus was 
issued, the directors believed that the}' would have no difficulty 
in procuring the necessary consent ; but they had not applied 
for it, and they had no reasonable grounds for their belief. It 
was held that notwithstanding their belief they were liable in 
damages to a person who had taken shares on the faith of the 
statement kfthe prospectus. 

By way of contrast with this decision, and as a strong illus- Weir v. Be'.l 
tration of the leniency above alluded to, reference ma} 7 be made 
to Weir v. Bell (m). There the directors of a company were 
authorised by a general meeting to raise money by debentures. 
The directors, including Bell, authorised the secretary to 
employ a firm of brokers to obtain subscriptions for the deben- 
tures. The brokers issued a prospectus which contained 
serious mistatements of fact which were false to the knowledge 
of the brokers, and mentioning Bell and others as directors. 
The plaintiff subscribed for debentures on the faith of this pro- 
pectus, and, they proving worthless, sued Bell for damages. 
But there was no proof that Bell knew of or authorised these 
statements, and the jury found that he did not. It was there- 
fore held that he was not liable. Cotton, L.J., dissented on 

D. 696 ; Weeks v. Propcrt, L. R. 8 (I) 37 Ch. D. 541. See, also, 

C. P. 427 ; Cherry v. Col. Bank of Cann v. Wilson, 39 Ch. D. 39. 

Australasia, L. R. 3 P. C. 24. (m) 3 Ex. D. 32 & 238 ; Cargill v. 

(k) See Ship v. CrosskiU, 10 Eq. Dov-er, 10 Ch. D. 502. Compare 

73, ante, p. 71 ; Smith v. Ghadwick, Peek v. Gurncy, 13 Eq. 79 & L. R. 6 

L. R. 9 App. Ca. 187, and 20 Ch. D. H. L. 377 ; Peek v. Dcrry, 37 Ch. 

27 ; Bellavrs v. Tucker, 13 Q. B. 1). D. 541. 



Bk. I. Chap. 
Sect. 1. 

Shares not pro- 
cured from 

Peek v. Gurncv, 


Lapse of time. 

Measure of 

the ground that it was Bell's duty as a director to know the 
contents of a prospectus issued by persons authorised by him 
to invite subscriptions for the company's debentures. 

In an action against directors for a fraudulent statement in a 
prospectus, it is always material to consider from whom the 
plaintiff acquired his shares and from whom he obtained the 
prospectus. The object of a prospectus is to induce persons 
to apply to the company for shares, and not to enable persons 
who have shares to sell them to other people. Accordingly it 
was decided by the House of Lords in Peek v. Gurney (n) that 
a person who had bought shares on the stock exchange on the 
faith of a prospectus which was materially misleading, could 
not maintain an action for damages against the directors with- 
out proof of some direct communication between them and him. 

A fraudulent concealment of a material fact will not support 
an action for damages unless its effect is to make what is stated 
untrue. This doctrine was distinctly laid down by Lord Cairns 
in Peek v. Gurney (o), and has been often recognised since (p). 
There is no doubt, however, that the commission of frauds in 
the formation of companies is greatly facilitated by this limita- 
tion of the circumstances necessary to sustain such actions. 

In an action for damages, lapse of time short of that 
prescribed by the Statute of Limitations affords no defence (q). 

The measure of damages in these cases is the difference 
between the price paid by the plaintiff for his shares and their 
real value at the time. Their market value may, however, be 
and practically always is dependent on the ignorance on the 
part of the public of the frauds complained of. In order to 
ascertain the real value of the shares subsequent events must 
be looked at ; and if these show that the shares were really 
worthless, the whole of the money paid for them will be 
recoverable. The circumstance that the plaintiff might have 
sold his shares at a high price before the frauds were exposed 
does not diminish the damages to which he is entitled (r). 

O) L. R. 6 H. L. 377. 

(o) L. R. 6 H. L. 377 ; see ante, p. 

(p) Arkwright v. Newbold, 17 Ch. 
P. 301. 

('_/) Peek v. Gurney, L. R. 6 H. 
L. 377.; overruling on this point 
S. C. 13 Eq. 79. 

(r) r Peeh v. Derry, 37 Ch. D. 54 L ; 
Twycross v. Grant, 2 C. P. D. 409 ; 


Ilk. I. Chap. 3. 

30<t-31 Via. c. 131, § 38. 

In order the more effectually to protect shareholders (••>•) Fraudulent 
from frauds on the part of the promoters of companies, every '' ' 1 " 
prospectus of a company, and every notice inviting persons to 30 ft 31 Vict, 
subscribe for shares in any joint stock company, is required to c ' b 38 ' 
specify the dates and names of the parties to any contract 
entered into by the company or the directors, promoters, or 
trustees thereof before the issue of such prospectus or notice (t). 
The statute which renders this necessary is very badly worded 
and lias given rise to much discussion and no little difference 
of opinion. In the first place it does not apply to all com- 
panies, but only to those formed under the Companies act, 
1862. In the next place the information required to be given 
is practically worthless: the act only requires dates and names 
to be given : the nature and effect of the contracts to be 
referred to need not be stated ; but it is obvious that this is 
what is most material to be known. 

Compliance with the statute does not prevent a false pro- 
spectus from being treated as fraudulent if in truth it is so. 
The object of the statute is to enlarge, not to restrict, the 
doctrines relating to fraudulent prospectuses ; and this object 
is sought to be attained by declaring that prospectuses shall 
be deemed fraudulent unless the dates and names of the parties 
to certain contracts are disclosed. The contracts referred to 
are not clearly defined, but it is obvious that only those can be 
meant which can be regarded as material to persons who may 
become shareholders. The result of the decisions on this 
extremely ill-expressed enactment seems to be as follows : — 

1. The enactment is not confined to contracts to be per- 
formed by the company, but extends to all contracts (u) whether 

Davidson v. Tulloch, 3 McQu. 790. is printed in the Appendix. 

See, also, Arhwright v. Neicbold, 17 (») An understanding between 

Ch. D. 301, fcr Fry, J. the persons mentioned not amount- 

(s) Bondholders are not within ing to a contract is not within the 

the enactment, Cornell v. Hay, L. E. section, Arhwright v. Xevbolrf, 17 

« C P. 328. Ch. I). 301. 

(t) 30 & 31 Vict. c. 131, § 38. It 


Bk. I. Chap. 3. in writing or not (r), entered into b\ T the persons mentioned, 

Sect. 2. 

and directly or indirectly affecting the formation, management, 

capital, or other propert) T of the company, or the position of 
the directors or officers of the company with respect to the 
company, its promoters or vendors, and which might reason- 
ably influence a person in determining whether to apply for 
shares or not (x). 

2. The enactment does not extend to contracts by which the 
promoters themselves have become owners of the property which 
they afterwards sell to the company if such contracts in no 
way affect the company itself (?/). 

3. The words promoter, director, or trustee include persons 
engaged in forming the company, or engaged in inducing the 
public to take shares in it when formed (z) : and perhaps even 
persons who are not so engaged when the contract with them 
is entered into, but who afterwards become promoters, directors 
or trustees (a). 

4. A person who takes shares on the faith of a prospectus, 
not complying with the enactment in question, is not entitled, 
simply on that ground, to rescind his contract to take the 
shares (b) ; but is only entitled to maintain an action for 
damages against the promoters, directors, or trustees who 
knowingly issued the prospectus (c). 

It has become customary to insert in prospectuses a clause 
to the effect that applicants for shares waive all claims against 
directors for infringements of § 38, but the validity of such 
clauses is very doubtful. 

(v) Arkvrrifjld v. Newbold, 17 Ch.~ servations of L. J. James on this 

D. 301 ; Capcl <£■ Go. v. Sim's Com- last case, 5 Cli. D. 118. 

position Co., W. N. 1888, p. 97. (::) Twycross v. Grant, 2 C. F. D. 

(x) Sullivan v. Mitcalfe>5 C. P. D. 469. See infra, bk. iii., c. 2, § 1. 

455 ; Tvycross v. Grant, 2 C. P. I). («) Sullivan v. Mitcalfe, 5 C. P. D. 

469 ; Jury v. Stoker, 9 L. R., Ir. 455 ; Govers case, 1 Ch. D. 182, and 

385; Cornell v. Hay,L. R. S C. P. 20 Eq. 114. Sed quaere : see 5 Ch. 

328. D. 118. 

(ij) Sullivan v. Mitcalfe, 5 C. P. D. (b) lb. 

455 at p. 467 ; Craig v. Phillijis, 3 (c) Ibid., and Twycross v. Grant, 

Ch. D. 722 ; Cover's case, 1 Ch. D. ubi sup. 
182, and 20 Eq. 114. See the ob- 




Having made the foregoing observations on companies in Bk. I. Chap. 

general, it is proposed to advert to the formation of different Formation of 
, . ■, n . , , • i it-i companies, 

kinds of companies, and to the evidence by which a person 

may be proved to be a shareholder in them. 

It will be convenient to take them in the following order :— 

Class I. Cost-book mining companies. 

Class II. Companies incorporated or privileged by the 
Crown, viz. : — 

1. Chartered companies. 

2. Companies formed under the Letters patent act, 7 

Win. 4 & 1 Yict. c. 73. 
Class III. Companies incorporated or privileged by some 
special act of Parliament, viz. : — 

1. Companies not incorporated, but empowered to sue 

and be sued. 

2. Incorporated companies. 

Class IV. Companies incorporated or privileged by a general 
act of Parliament, viz. : — 

1. Banking companies formed under 7 Ceo. 4, c. 4G. 

2. Registered companies. 

Class I. — Cost-book mining companies. 

Cost-book mining companies are sometimes represented as Cost-book 
. . . companies, 

differing essentially from ordinary partnerships ; but there is 

no authority for this statement ; and it may be said with more 

truth that cost-book mining companies are mere partnerships 

governed by the general law of partnership, except so far as 

that law is excluded by local custom or by special agreement 


Bk. I. Chap. i. referring to and embodying such custom («•). A cost-book 
- mining company is formed by agreement. A number of adven- 
turers who have obtained permission to work a lode agree to 
share the enterprise in certain proportions. It is seldom that 
they agree on a fixed capital (b). They appoint an agent, com- 
monly called a purser, for the purpose of managing the affairs 
of the mine, subject to the control of the shareholders. They 
Cost- book. write in a book called the " cost-book " the agreement into 

which they have entered ; and in this same book are inserted 
from time to time the receipts and expenditure of the mine, 
the names of the shareholders, their respective accounts with 
the mine, and transfers of shares (c). The shares are trans- 
ferable and may be relinquished ; they may also be sold by the 
company for non-payment of calls ; and these circumstances, 
rather than any other, distinguish cost-book mining companies 
from common partnerships (d). 
Liability to Some persons imagine that the liability of shareholders in 

creditors. cost-book mining companies is limited ; that both their past 

as well as their future liability is got rid of as soon as they 
have transferred their shares, and that they are in no case 
liable for the debts of the mine if they have paid the calls 
which may have been made upon their shares. All this is 
mere delusion ; and although it is true that a shareholder can 
as between himself and co-shareholders get rid of his liability 
by transferring or relinquishing his shares (e), there is no 
authority whatever for saying that the liabilities of the share- 
holders to creditors were until lately governed by principles in 
any respect different from those which apply to ordinary part- 

(«) See Frank Mills Mining Co., (c) See 32 & 33 Vict. c. 19, § 9, 

23 Ch. D. 52 ; Prosper United Mining and 50 & 51 Vict. c. 43, §§ 23 & 24. 

Co., 7 Ch. 286 ; and as to Cost-book The rules and regulations must now 

mining companies, 32 & 33 Vict. c. he filed with the registrar of the 

19, amended by 50 & 51 Vict. c. 43 ; Stannaries Court, 32 & 33 Vict, c. 

the Readwin Prize Essay on the 19, § 9. 

Cost-book, by Tapping ; Collier on (d) 32 & 33 Vict, c. 19, §§ 16-23. 

Mines, ed. 2, pp. Ill, etseq. Batten's (e) Fenn's case, 4 De G. M. & G. 

Stannaries Act, 1869. 285 ; Mayhem's case, 5 ib. 837 ; Bod- 

(h) Mr. Batten in his useful little rain United Mines, 23 Beav. 370 ; 
treatise, p. 31, says that a true Cost- Birch's- case, 2 De G. & J. 10 ; Loft- 
hook company never has a fixed house's case, ib. 69. 


nerships(/). By the Stannaries act, 1869 (32 & 33 Vict. Bk. I. Chap. 4. 

c. 10, s. 25), however, a past shareholder is not liable to con- - 
tribute to the assets of the company if he has ceased to be a 
shareholder two years or upwards before the date of the 
winding-up order (<i). 

Whoever alleges that a cost-book mining company is in any Mining customs 
respect governed by a local usage which excludes the applica- noticed, 
tion of the general law of partnership, must prove the existence 
of such usage (It) ; for the courts do not take judicial notice of 
what the cost-book principle is ; and they invariably apply the 
general law of partnership to companies formed on that prin- 
ciple, unless it is proved that the application of such law is 
excluded as alleged (/). 

The question whether a person is or is not a shareholder in Proof of member- 
ship in a cost- 
a cost-book mining company must be determined in precisely book company. 

the same way as the question whether a person is or is not a 

member of an ordinary partnership (k). The usual mode of 

proving that a person is a shareholder in a cost-book mine is 

by showing that he has signed the cost-book or an authority 

for the insertion of his name in it : and it has been said to be 

part of the cost-book principle that a register of shareholders 

should be kept, and that every member should sign either the Signing th ■ 

book itself or an authority for the insertion of his name in it (I). 

At the same time, a person clearly may, as between himself 

(/) Shareholders in a cost-book Beav. 370 ; Fenn's case, 4 Do. G. M. 

mine were held liable to creditors & G. 285 ; Hart v. Clarke, 6 ib. 

for goods supplied in Tredwm v. 232, and 6 H. L. C. 633 ; Sibley v. 

Bourne, 6 M. & W. 461 ; Newton v. Minton, 27 L. J. Ch. 53, V.-C. Kin- 

Daly, 1 Fos. & Fin. 26 ; Lanyon v. dersley. The purser can now sue a 

Smith, 3 B. & Sm. 938 ; Harvey v. shareholder for calls. See 32 & 33 

Clough, 2 N. R. 204. See, too, Vict. c. 19, § 13. See before this 

Ellis v. Shmceck, 5 Bing. 521 ; Peel act, Hybart v. Parker, 4 C. B. N. S. 

v. Thomas, 15 C. B. 714; Toll v. Lee, 209. 

4 Ex. 230. (k) See Peel v. Tliomas, 15 C. B. 

(g) hi re Wheal Unity Wood 714; Tredwen v. Bourne, 6 M. & W. 

Mining Co., Chynoweth's case, 15 461; Thomas v. Clark, 18 C. B. 662. 

Ch. D. 13, at p. 21. (I) See Tippett v. Johns, Tap- 

(h) See ante, note (a), and the ping's Essay, p. 187 ; Toll v. Lee, 

cases cited below. 4 Ex. 230. Such a register is now 

(i) See Hawkins' case, 2 K. & J. required, see 32 & 33 Vict. c. 19, 

253 ; Bodmin United Mines, 23 § 9. 



F.k. I. Chap. 
CJass 1. 

Vice r. Anson. 

Transfer of 

and third parties, incur the liabilities of a shareholder without 
signing the cost-book or any such authority as that referred 
to (m) ; and it is apprehended that a person may be a share- 
holder as between himself and the other members although 
he ma} r not have signed the cost-book or any authority for the 
insertion of his name in it. Indeed there is reason for going 
further, and for denying that any such signature is essential ; 
for an attempt to prove it to be so is reported to have failed, 
the evidence adduced amounting only to this, that it was usual 
for every member to testify his acceptance of shares by writing 
under his hand (n). 

In Vice v. Anson (p), the Court seems to have thought that 
a person could not be a shareholder in a cost-book mining 
company unless he acquired some interest in the mine, treating 
it as land, and that some deed conveying him an estate in the 
land was recmisite. But this opinion cannot be supported ; 
and it seems clear that shares in a cost-book mining company 
are transferable by entries in the cost-book ; and that a person 
who is entered therein as a shareholder in respect of shares 
accepted by him is a shareholder, although no deed or writing 
at all has been executed (_p). Shares in cost-book mining 
companies are ordinarily transferred by a document in which 
the transferor acknowledges that he has transferred, and the 
transferee acknowledges that he has accepted the shares 
mentioned. This document is signed by both parties, is 
addressed to the purser, is sent to him by the transferee, and 
is the authority to the purser to register the transferee as a 
shareholder (q). 

(m) See Martyn v. Gray, 14 C. B. 
X. S. 824, as to holding out ; and 
see Cox's case, 4 De G. J. & Sra. 53, 
where a person entitled to shares 
tried to screen himself from liability 
by holding them in the names of 
other people. 

(n) Northey v. Johnson, 19 L. T. 
104, Q. B. 1852. ' That this is usual 
there can be no doubt ; it is ex- 
pressly required by the rules of 
most large mines. 

(o) 7 B. & C. 409. 

(p) See Tippet v. Johns, Tap- 
ping's Essay, p. 187 ; Reynolds v. 
Bassdt, Collier on Mines, 124, note ; 
Viryan v. Mowatt, 8 L. T. Ex. 480 ; 
Northey v. Johnson, 19 L. T. 104 ; 
Toll v. Lee, 4 Ex. 230. Compare 
Curling v. Flight, 5 Ha. 242 ; 6 ib. 
41 ; and 2 Ph. 643. 

(q) Toll v. Lee, 4 Ex. 230 ; Walker 
v. Bartlctt, 18 C. B. 845. See, as to 
parol transfers, Northey v. Johnson, 
19 L. T. 104, Q. B. See, also, 32 & 
33 Vict, c. 19, §§ 14, 15, and 35. 


r.y 33 & 34 Vict. c. 97, s. 3 ; an 1 schedule, title Transfer, a Bk. i. « ha P . 4. 
. . . 

6a. stamp duty is imposed upon " any request or authority to 

the purser or other officer of any mining company conducted' 
on the cost-book system, to enter or register any transfer of 
any share or part of a share in any mine ; or any notice to 
such purser or officer of such transfer " (/•). 

Companies engaged in working mines within and subject to Registration, 
the jurisdiction of the Stannaries, need not be registered under 
the Companies act of 1862 («) ; but if their capital is fixed, 
and if there are seven or more shareholders, the}' may be so 
registered, with or without limited liability. If the capital is 
not fixed, the company cannot apparently be registered as an 
existing company with limited liability (t). The effect of regis- 
tration under the Companies act, 1862, will be considered 
hereafter (u). If not registered under that act, cost-book 
mining companies working mines within the Stannaries are 
subject to the provisions of '-I'l & •'>:> Vict. c. 19, and if working 
metalliferous mines or tin streaming works, to the provisions 
of 50 & 51 Vict. c. 43, which will be noticed in their proper 

Class II. — Companies chartered or privileged pa* the 


1. Chartered companies. 

The Crown has at common law the power of incorporating Chartered 
by charter any number of persons who assent to be incorpo- 
rated, and a chartered company is therefore formed as soon as 
a charter is granted to, and accepted by, two or more indivi- 
duals, enabling them, alone or with others, to trade as a body 
corporate (x). The Crown, however, has no power to incorpo- 

(;•) The cost-book itself requires see Lanyon v. Smith, 3 B. & Sm. 

no agreement stamp. See Vivyan 938 ; and Harvey v. Clough, 2 N. R. 

v. Mowatt, 8 L. T. Ex. 480. 204. 

(s) 25 & 26 Vict. c. 89, § 4. (a?) See, as to charters, Grant on 

(t) See 25 & 26 Vict. c. 89, § 179, Corporations, pp. 9, ct seq. As to 

cl. 3, and § 181. charters for a limited time, see 7 

(u) As to the effect of registration Will. 4 & 1 Vict. c. 73, § 29, and 

with respect to retired shareholders, 47 & 48 Vict. c. 56. 

L.C. II 


Bk. I. Chap. 4. ra te persons against their will (y) : nor can the Crown force a 

Class 2. 

— - new charter upon a corporation after it is once established. A 

charter which has been confirmed by act of Parliament cannot 
be varied by the Crown (z) ; but a charter which has not been 
so confirmed may, without being formally surrendered (a), be 
varied by a subsequent and inconsistent charter (//), provided 
the new charter is accepted by the body corporate (c), i.e., by a 
majority of the members composing it (d). 

A chartered company is a corporation existing for the pur- 
poses for which it is created and no others ; and those persons 
only are members of it who are declared to be so by the charter, 
or who have been admitted in compliance with the charter and 
the bye-laws made in pursuance of it (e). The charter of a 
company is a law set to it and to the individuals composing it, 
and they have no power by any agreement amongst themselves 
to annul or legally do anything at variance with their charter (/). 
This subject will be adverted to hereafter. 

Chartered com- A chartered company, being a corporation, is not a partner- 

panynota ship, although the company may have gain for its object, and 

the members of the company may share profits. 

Validity of A charter is not necessarily of any legal value ; for it may 

have been obtained from the Crown by misrepresentation, or 
it may have been granted by the Crown in excess of its pre- 
rogative, and in either case the charter will be void. A 
charter which has been obtained from the Crown by false and 
fraudulent statements may be formally annulled by scire 

(y) Grant, pp. 13 and 18 ; Dr. 1 . Coll. 370, an injunction was 

Ashew's case, 4 Burr. 2200, per granted to restrain the majority 

Yates, J. ; and see Rutter v. Chap- from accepting a new charter. See 

man, 8 M. & W. 1. Ex parte The Society of Attorneys, 8 

(z) R. v. Miller, 6 T. R. 268 ; but Ch. 163, for the grounds on whicli 

see Royal Exch. Ass. Co. v. Vaughan, the grant of a supplemental charter 

1 Burr. 155. can be successfully opposed. 

(a) R. v. Larwood, 1 Salk. 168. (e) Dr. Askew' s case, 4 Burr. 2200, 

(b) lb. ; and R. v. Haythorne, 5 per Yates, J. 
B. & C. 410 ; Royal Exch. Ass. Co. (/) See The Society of Practical 
v. Vaughan, 1 Burr. 155. Knowledge v. Abbott, 2 Beav. 559. 

(c) Bull. N. P. 212, c. ; R. v. As to giving effect to the practice of 
Pasmore, 3 T. R. 240. the members and allowing that to 

(d) R. v. Hughes, 7 B. & C. 708. control the charter, see Somes v. 
In Ward v. The Society of Attorneys, Currie, 1 K. & J. 605. 



facias(g); but although a charter which has noi been thus Bk. I. Ch 
annulled is to be treated as valid until the contrary is proved, 

there is apparently no rule to the effect that its validity is not 
to be disputed except in a formal proceeding instituted for the 
purpose of procuring its cancellation (h). At the same time 
those persons who have accepted or acted on a charter and 
treated it as valid cannot, unless in a proceeding to annul it, 
object that it was obtained from the Crown irregularly, or by 
the misrepresentation of themselves or their fellow-members, 
or of their predecessors (i). Indeed, it is said, that neither 
those who have accepted a charter, nor their successors, can 
dispute its validity ; but this is very doubtful (A). 

< barters are obtained by petitioning the Queen in Council. Charters bow 
The petition and draft of the proposed charter are left at the " l,t;m " L 
Council Office, and are then referred to the Board of Trade. 
The Colonial Office, Foreign Office, and India Office are also 
referred to, if the proposed company falls within their depart- 
ments. If it is determined that a charter shall be granted, it 
issues under the great seal (/). But charters are now very 
seldom granted to trading companies. 

A charter maybe surrendered to the Crown; but a surrender 
is of no effect unless accepted and enrolled in the enrolment 
department of the central office of the Supreme Court of Judica- 
ture (m). After the surrender has been accepted and enrolled 
the corporation ceases to exist (»). 

2. Companies formed under the Letters patent act, 
7 Will. 4 cC- 1 Vict. c. 73. 

Letters patent and charters are both Uteres patentcs sealed Companies 
with the great seal, and are, in fact, the same thing. But the Lette^patent * 
Crown is empowered by the act 7 Will. 4 & 1 Vict. c. 73 (o), act - 

{(j) E. v. The Eastern Archipelago Companies, p. 401, ed. 10 ; see, as to 

Co., 1 E. & B. 310 ; 2 ib. 856 ; and advertisements, 7 Will. 4 & 1 Vict. 

4 De G. M. & G. 199. See, as to c. 73, § 32. 

sci. fa. to repeal patents, 2 Wins. (m) See E. v. Oshourne, 4 East, 

Saund. (ed. 1871), 231, et seq. 326, and Jud. (Officers) act, 1879, 

(h) Grant on Corp. 39, &c. 42 & 43 Vict. c. 78, §§ 4, 6 and 12 

[i) See Macbride v. Lindsay, 9 Ha. and Ord. LXI. 

574. (n) Grant, 46. 

(k) See Grant, 20— 22. (o) Repealing 6 Geo. 4, c. 91, § 2, 

(0 See Wordsworth on Joint Stock and 4 & 5 Will. 4, c. 94. 


Bk. I. Cbap. 4. to grant by letters patent to any company or body of persons, 
■— - although not incorporated by such letters patent, any privileges 
which the Crown might at common law grant to any company 
or body of persons by any charter of incorporation. Letters 
patent under this act are obtained on application to the Queen 
in Council, and notice of the application must be inserted 
three times in the "London Gazette," and in one or more of 
the newspapers, circulating in the county in which it is pro- 
posed that the principal place of business of the company shall 
be established, at intervals of not less than one week {p). 

Company's deed. Every company formed under this act, is required to be 
entered into by agreement under seal, in which are to be 
specified the number of shares in the company, the name of 
the compairy, the names of its members, the date of its com- 
mencement, the nature of its business, the place or principal 
place where such business is to be transacted, and also the 
names of two or more officers to sue or be sued on behalf of 
the company (q). Within three months after the grant of the 
letters patent, a return is to be made to the enrolment depart- 
ment of the central office (r) of all the above particulars, and of 
the date of the letters patent (-s) ; and returns are required to be 
made of every change made in the company's principal place of 
business, and of every change amongst its shareholders (t), 
and of the officers by which it is to be sued (u). These 
returns are directed to be registered and to be open to the 
inspection of any person upon payment of a small fee (x). A 
certified copy of the return is made evidence both in civil and 
in criminal proceedings (y). 

Such companies Companies formed under this act are not corporations, but 

not corporations. are esse ntially partnerships. Their privileges depend on the 
letters patent obtained by them. The possession of a common 
seal is taken for granted in the act itself (z) ; but there is 
nothing requiring the seal to be affixed to a contract, in order 

(p) 7 WE 4 & 1 Vict. c. 73, (t) lb. §§ 7-10. 

§ 32. («) lb. § 13. 

(q) lb. § 5 (,;) lb. § 17. 

(r) In the case of an English com- (y) lb. § 18 ; see, too, §§20 and 

pany, see § 26, and 42 & 43 Vict. 21. 

c. 78, §§ 4, 6 and 12, and Ord. LXI. (,-„.) See § 27. 

00 lb- § 6. 

7 WM. 1 AND 1 VK'T. C. 73. 101 

to bind the company; and the act is express that the members Bk - *■ cha P- 4 - 

,, , . . Class 3. 

oi the company are to be liable to its debts and engagements, 

except so far as that liability may be limited by the letters 
patent (a). 

Who are to be deemed members is not stated; that question Members, 
therefore must depend in each case upon tin- provisions of the 
deed of settlement, and of the letters patent by which the 
particular company in question may be governed; but when 
once a person has become a member, his liability as a member 
continues, until a return of the means whereby he has ceased 
to be one is registered (b). 

The act does not state with any precision how shares are 
to be transferred, but a transfer, by deed or writing, is evi- 
dently contemplated (c). 

This act is seldom had recourse to ; the modern registra- 
tion acts have practically superseded it. 

Class III. — Companies incorporated or privileged by 


1. Companies not incorporated, but empowered to sue and be 


These companies are formed b} r agreement, and by the acts Companies em- 

... ... ... -, TT . * . , powered to sue 

which privilege them (a), uhether a person is a member or an d be sued, 
not, depends, in the absence of any special provisions in the 
act of the company which may be in question, upon the prin- 
ciples applicable to ordinary partnerships. 

Banking companies governed by the general act, 7 Geo. 4, 
c. 46, may be regarded as the type of companies empowered to 
sue and be sued, and the authorities which will be referred to 
hereafter, in connection with that act (infra, Class 4), may be 

(«) See §§ 2-4 and 24. be sued by a public officer, see Bank 

(b) See § 21. of Australasia v. Harding, 9 C. B. 

(c) See §§ 8 and 9. 661 ; Bank of Australasia v. Nias, 

(d) As to companies empowered 16 Q. B. 717 ; Kelsall v. Marshall, 1 
bv a colonial legislature to sue and C. B. N. S. 241. 



Bk. I. CLap. 4. usefully consulted upon questions arising upon special acts of 
Class 3. 

a similar description. 

Companies in- 
corporated by 
spi cial act of 


Promoters not 

contract and 

The special act. 

2. Incorporated companies. 

A company incorporated by a special act of Parliament 
exists as an incorporated company by virtue of that act, and 
not otherwise. It is formed by the act, and by that alone, 
and those only are members of the company who are made so 
by the act. 

Persons associated together for the purpose of obtaining an 
act of Parliament to incorporate them into a company, are not 
partners, although the company, when formed, will have gain 
for its object, and although the shareholders will divide 
amongst themselves whatever profits may accrue to the com- 
pany (e). 

It does not fall within the scope of the present work to 
detail the method of obtaining acts of Parliament, or to advert 
to the rules which have to be observed in compliance with the 
standing orders of the two houses (/). It may, however, be 
observed, that before an act can be obtained for the incorpora- 
tion of a company, a deposit must be made of a certain pro- 
portion in some cases of the estimated expense of the under- 
taking, and in others of the capital it is proposed to raise. 
Formerly a contract had to be entered into by the subscribers, 
whereby each covenanted to pay a sum set opposite his name. 
This contract was commonly called the " parliamentary con- 
tract," by way of distinction from the " subscribers' agree- 
ment," i.e., the agreement entered into by the allottees of 
shares for the formation of the company. 

The act which each company may succeed in obtaining for 
itself is called its " special act," and governs the company as 
to all matters specially provided for in it. But as to other 

(e) See infra, book ii., c. 1, and 
Partn. pp. 23, et seq. 

(/) The standing orders are pub- 
lished annually, and reliance is not 
to be placed on any except the last 
for the time being. See on this 
subject generally, Hodges on Rail- 

ways, c. i. ed. 6 ; and as to the ap- 
plication of the deposit in payment 
of debts, Bradford Tramways Co., 4 
Ch. D. 18; Lowestoft, Y.,d-S. Tram- 
ways Co., 6 Ch. D. 484 ; and Bir- 
mingham and Lichfield Junction 
Bail. Co., 28 Ch. D. 652. 


matters the company (if incorporated since the 8th of Mav. Bk. I. Chap. 4. 

Class 3 

L845) is governed by the Companies clauses consolidation 

act (//), which is a public general act passed in .May, L845, and eh^B^aS!"^ 
is applicable to every English (/<) company incorporated by act 
of Parliament since that time, save so far as its clauses and 
provisions may be expressly varied or exempted by the com- 
pany's special act. In the present place it is proposed to 
notice such of the clauses of the act in question as relate to 
the constitution of the companies to which it applies, and to 
the evidence of membership therein. 

A company is supposed to be incorporated by a special act, 
to have the amount of its capital fixed thereby, and to have the 
capital thus fixed, divided into shares of a certain number and 
amount, and numbered progressively from one upwards, so that 
each share may be distinguished by its appropriate number 
(§ 6). The company is then (by § 9) required to keep a book 
called the "register of shareholders," in which book are to Register of 
be entered, (1), the names of the persons entitled to shares in blmxholders - 
the company ; (2), the number of shares to which such persons 
are respectively entitled ; (3), the distinguishing numbers of 
such shares ; and (4), the amount of the subscriptions paid on 
them. This book is to be authenticated by the seal of the 
company (which is to be affixed at ordinary meetings), and is 
prima facie evidence against a person registered therein as a 
shareholder that he is so in point of fact (see § 28) ; and the 
creditors of the company have a right to inspect it (§ 36). In 
addition to the " register of shareholders," the company is 
required to keep a " shareholders' address book " (§ 10), which 
is to be open to the inspection of every shareholder at all con- 
venient times (/). On demand of the holder of any share, and 
on payment of a small fee, the company is required (§ 11) to 
deliver to him under its seal a certificate of proprietorship ; 
and this certificate is (§ 12) required to be admitted in all Share certificate. 

(g) 8 & 9 Vict. c. 16, amended by discussed in this treatise. 

26 & 27 Vict. c. 118 ; 32 & 33 Vict. (h) See Wilsonx. Caledonian Rail. 

c. 48 ; 38 & 39 Vict. c. 66 ; 47 & Co., 5 Ex. 822. 

48 Vict, c, 43, and 51 & 52 Vict. (?) See as to inspection and taking 

c. 48. The Lands clauses and the copies, infra, book iii. c.l, § 3, & c. 3, 

Railways clauses consolidation acts § 4. * 
have no connection with the topics 


Bk. I. Chap. 4. courts as prima facie evidence of the title of the person named 

Class 3 • • i 

! in it, and of his executors, administrators, or assigns to the 

share therein specified (j). Provision is then made for the 
transfer of shares, for the registry of transfers, for the pay- 
ment of calls, for the forfeiture of shares for the non-payment 
of calls, and for executing against shareholders judgments 
which have been obtained against the company ; all of which 
matters will be noticed hereafter. 

Who are share- The statute contains two definitions of the term share- 
holders. , . 7 

holder : — 

1. It is declared in § 3, that the word shareholder shall 
mean shareholder, proprietor, or member of the company ; 

2. It is declared in § 8, that every person who shall have 
subscribed the prescribed sum (k) or upwards to the capital of 
the company, or shall otherwise have become entitled to a 
share in the company, and whose name shall have been entered 
on the register of shareholders, shall be deemed a shareholder 
of the company. 

Upon this section it has been decided that a person may be 
a shareholder although he has not paid for his shares, and 
although payment is a condition precedent to his exercising 
his full rights (/). 
Effect of register. As regards the entry on the register, it is to be ob- 
served : — 

1. The act nowhere says that a person not on the register is 
not a shareholder. A person made a member by the special 
act is clearly a shareholder although not registered (>») ; and it 
is conceived that other persons may be shareholders although 
not registered as such («)• 

(j) The certificate only shows the 201 & 664, where no shares were 

legal title, Shropshire Union Rail. Co. ever issued, and no register was ever 

v. B., L. E. 7 H. L. 496. kept. Compare Kipling v. Todd, 3 

(/.•) i.e., the sum prescrihed in the C. P. D. 350, and see O'Brien's case, 

company's special act, see § 2. Ir. B. 11 Eq. 422. 

(I) East Gloucestershire Bail. Go. (n) See the last note, and Bastrick 

v. Bartholomew, L. E. 3 Ex. 15, and v. Derbyshire, d-c, Bail. Co., 9 Ex. 

see, also, McEuen v. West Bond. 149, and Wolverhampton Waterv. Co. 

Wharves Co., 6 Ch. 655. * v. Hawhesford, 6 C. B. N. S. 336, 7 

(m) Portal v. Emmens, 1 C. P. D- ib. 795, and 11 ib. 456. 


2. The register is primd facie evidence that a person whose 1!k - T - ( ' 1,ft i'- 4 - 

Class 3. 

name is on it is a shareholder. 

It follows from this, that the company may put anybody's 
name on the register, and throw upon him the burden of 
showing that he is not a shareholder (o). But the register is 
no evidence that a person whose name is not on it is a share- 
holder; and therefore where shares were allotted to " Brown- 
rigg and Taylor," who were trustees for anothi c person, and 
were described on the register as " Brownrigg and others," 
this entry was held to be no evidence against Taylor (/)). 

The leading case on the requisites of a register of share- Form of register, 
holders in companies governed by the Companies clauses con- 
solidation act, is Wolverhampton New Waterworks Company v. Wolverhampton 

New "Welter works 

Hatokesford(q). It was there held that a sheet of paper on company v. 
which were written the names of some shareholders, and the IIuNvkcsford - 
total number of shares held by them, and which paper was 
sealed with the seal of the company, was not a register at all. 
In this case the shares were not identified by numbers, and in 
this respect the register was substantially informal; and the 
Court relied much on this circumstance. But it would, per- 
haps, be going too far to hold that if a company issues un- 
numbered shares, and keeps a proper register of such shares, 
this register is altogether useless and inadmissible in evi- 
dence (r). And if the shares are numbered the register is 
admissible, although it does not contain the numbers of the 
shares (s). 

A rough share book has been held inadmissible in evidence 
as a register under the act now in question (t). 

If the register is in several volumes they are all admissible 
in evidence, although the company's seal is to be found in the 

(o) Waterford, Wexford, <fec, Bail. Emmens, 1 C. P. D. 201 & 664. 

Co. v. Pidcock, 8 Ex. 279 ; Bain (r) See the last case, and Irish 

v. Whitehaven Rail. Co., 3 H. L. Peat Co. v. Phillips, 1 B. & Sm. 

C. 1 ; West Cornwall Rail. Co. v. 638. 

Mowatt, 15 Q. B. 528. (s) East Gloucestershire Rail. Co. 

(p) Birkenhead , Lancashire, &c, v. Bartholomew, L. R. 3 Ex. 15. 

Rail. Co. v. Brownrigg, 4 Ex. 426. (t) Birkenhead, dr., Rail. Co. v. 

(q) 6 C. B. N. S. 336, 7 ib. 795, Brownrigg, 4 Ex. 426 ; Cheltenham, 

and 11 ib. 456. Compare Ported v. dr., Rail. Co. v. Price, 9 C. & P. 55. 


Bk. I. Chap. 4. l as t of them only (u) ; and the register sealed with the seal of 
— — the company is admissible in evidence without proof of the 
time or place, or authority at or by which the seal was 
affixed (x). Moreover, the register is, if sealed and kept sub- 
stantially as required, prima facie evidence against any one 
whose name is on it, although he may prove that it has been 
kept irregularly, and is in many respects inaccurate and imper- 
fect (y) ; but the sealed register is no evidence that a person 
whose name is on it was a shareholder at any given time 
anterior to the day on which the seal was affixed (z). 

Register not 3, The register is not conclusive evidence that a person 

conclusive. . . . . 

whose name is on it is a shareholder. It is competent tor him 
to rebut the pui md facie case made against him by the register, 
by showing that the company inserted his name in it without 
any authority. An express authority from him is not, however, 
requisite ; for if he has entered into a contract with the pro- 
moters of the company to take shares in it, and if that contract 
is binding upon both parties, he may without more be properly 
registered as a shareholder, and the contract and the register 
will together be conclusive against him. But if he can show 
that no such contract was ever entered into, or that such a 
contract, if ever entered into, had terminated before his name 
was inserted in the register, then the prima facie case raised 
against him by it will be at an end. The following cases 
illustrate these propositions : 
Eight of com- 1. As to the right of the company to register those who 

pany o regis i. ^^ eil titlecl to shares. That a person who is bound to accept 
shares may be properly registered as a shareholder was decided 
in The Midland Great Western Railway Company v. Gordon (a). 

(a) Inglis v. The Great Northern Brighton Rail. Co. v. Fairclough, 

Bail. Co., 1 Macqueen, 112. ib. 674 ; Birmingham, Bristol, and 

(x) North-Western Bail. Co. v. Thames June. Bail. Co. v. Locke, 

M'Michacl, 5 Ex. 855. 1 Q. B. 256 ; London and Grand 

(y) See East Gloucestershire Bail. June. Bail. Co. v. Graham, ib. 271. 
Co. v. Bartholomew, L. K. 3 Ex. 15 ; (-.) Cheltenham and Great Western 

Bain v. Whitehaven Co., 3 H. L. Union Bail. Co. v. Price, 9 C. & P. 

C. 1 ; Southampton Dock Co. v. 55. 

Richards, 1 Man. & Gr. 448 ; Lon- (a) 16 H. & W. 804 ; see, too, 

don and Grand June. Bail, Co. v. Burke v. Lechmere, L. R. 6 Q. B. 

Freeman, 2 ib. 606; London and 297; Nixon v. Brownloiv, 2 H. & N. 


In tliat case a railway company was projected; the defendant Bk. I. Chap. i. 

• ii i-i» Cla 
agreed to take snares in it; he executed the subscribers agree- 

merit ; and he received scrip certificates. He sold the scrip 
before the company was incorporated. Alter it was incorpo- 
rated the company placed his name on the register of its share- 
holders, and lie was held to be a shareholder, although he had 
never authorised the insertion of his name in the register, 
except so far as his contract conferred an implied authority for 
such insertion (Ji). But a person who has never agreed to 
take shares, and who is only the holder of scrip transferable to 
bearer, ought not to be registered as a shareholder against his 

Will (r). 

2. As to the inconclusiveness of the register. A person Improper 
whose name is on the register is not a shareholder unless he 1C ° 
is also entitled to a share in the company ; and in order to 
entitle a person to a share, he must have acquired such title 
by the company's special act (d), or he must have been an 
original subscriber for the share, or have obtained a title to it 
from or through an original member or subscriher. An original 
subscriber does not become a shareholder by being placed on 
the register unless he has acquired a right to be registered ; 
and therefore if he has entered into a contract which uives him 
no right against the company to be considered a member • 
thereof until he has performed certain conditions, e.g., executed 
a deed, he does not become a shareholder by being registered 
as one before he has complied with those conditions ; for as the 
registry would not be equivalent to a compliance with the con- 
ditions for one purpose, e.g., as against the company if a divi- 
dend were claimed, so it is not equivalent to a compliance with 
them for another purpose, e.g., against him who is registered, 
in an action for calls (e). 

455, and 3 ib. 686 ; Cork and before the act had passed, he retired 

Youghal Rail. Co. v. Paterson, 18 from his contract so far as he law- 

C. B. 414. fully could. 

(b) In Kidwelly Canal Co. v. Rabij, (c) Eustace v. Dublin Trunk, &c, 

2 Price, 93, an act of Parliament, Rail. Co., 6 Erp 182. 
incorporating the subscribers to a (d) As in Portal v. Emmens, 1 C. 

company, was held to have made P. D. 201 & 664. 
the defendant a shareholder, he (e) Waterford, Wexford, &c., Rail. 

having been a subscriber, although, Co. v. Pidcoch, 8 Ex. 279 ; Curmar- 



Bk. I. Chap. 4. 
Class 3. 

Company not 
estopped by its 



Estoppel by 

Transfers of 

A person who is not yet entitled to share dividends, is not a 
shareholder in the company, and does not become one by 
simply being put on the register, unless indeed the insertion 
of his name there is the only one thing remaining to be done 
to perfect his title (/). 

It follows from the above that the company is not estopped 
by its own register (g). But when a person is put on the 
register, the company has no right to strike him off unless it 
can show proper grounds for so doing (h). 

The Companies clauses consolidation act contains no pro- 
vision for the rectification of the register ; but it may never- 
theless be rectified both by mandamus and injunction as already 
pointed out (i). 

The doctrine by which individuals and companies are 
estopped by their own conduct from taking advantage of the 
non-performance of conditions precedent, and the 'non- 
observance of prescribed formalities, is applicable to com- 
panies of the class now in question, and to shareholders in 
them, as is shown by the cases of Sheffield and Manchester 
Railway Company v. Woodcock (/.), and Cheltenham and Great 
Western Railway Company v. Daniel (I), which have been 
already noticed (m). 

Shares in companies governed by the Companies clauses 
consolidation act are transferable by deed delivered (duly 
executed), to the secretary of the company (n) ; a form of 
transfer is given by the act (o) ; and in order that a company 
may be compelled to register an instrument of transfer, it 

then Rail. Co. v. Wright, 1 Fos. & 
Firi. 282. See, also, Irish Peat Co. 
v. Phillips, 1 B. & Sm. 598, noticed 
ante, p. 50 ; and Edwards v. Kil- 
kenny Bail. Co., 14 C. B. N. S. 526. 

(/) See Shropshire Union Co. v. 
Anderson, 3 Ex. 401. 

(r/) See the last case, and Water- 
ford, Wexford, &c, Pail. Co. v. 
Pidcock, 8 Ex. 279. See, also, ante, 
p. 60. 

(/;) Ward v. S.-Eastern Rail. Co., 
2 E. & E. 812, Compare Hare v. 

Lond. and N.-W. Rail. Co., Johns. 

(i) Ante, p. 61. 

(/•) 7 M. & W. 574. 

(1) 2 Q. B. 281. 

(m) Ante, p. 49. 

(n) 8 & 9 Vict. c. 16, §§ 14 & 15 ; 
Nanney v. Morgan, 35 Ch. D. 598 
and 37 ib. 346 ; West v. West, 9 
L. B., Ir, 121. 

(o) 8 & 9 Vict. c. 16, § 14, and 
Sched. B. 


must be in a simple form, not differing substantially from the ]5k - T - Chap. l. 

r -i i / \ Class I. 
rorm prescribed (_/>). 

Class IV. — Companies incorporated or privileged by a 


1. Banking companies formed under 7 Geo. 4, c. 4G. 

Banking companies governed by 7 Geo. 4, c. 4G, and formed Banking com- 
before May, 1844, still exist, but no company can now be c . 46?' 
formed under that act (a). These companies are not mere 
partnerships, for they possess many privileges which ordinary 
partnerships do not (r). A company of this kind was formed 
by agreement, and the privileges alluded to were acquired by 
sending returns to the stamp office, of (inter alia) the names 
and residences of the members ; and the names, residences, and 
titles of office of two or more members resident in England, 
who had been appointed public officers of the company, and by 
any one of whom the company might sue and be sued (s). The 
returns thus made are evidence that all persons named therein 
as members were members at the dates of the returns in which 
their names appear (t). 

The act contains no definition of the term shareholder or who are .share- 
member ; but it has been decided that no person is a member bolders - 
within the meaning of the act unless he has complied with 
all the conditions necessary to constitute a person a member 
according to the company's deed of settlement. Thus it has 
been held that the husband of a married woman who, with 
his consent had become a shareholder, was not himself liable 
to creditors as a member, he not being a member according to 
the company's deed (»)• 

(p)Copelandv. North-Eastern Rail. (s) 7 Geo. 4, c. 46, §§ 4 & 5 ; an 

Co., 6 E. & B. 277 ; E. v. General irregularity in the returns does not 

Cemetery Co., ib. 415. deprive the company of the privi- 

(q) 7 & 8 Vict. c. 113, § 1. leges conferred by the act ; Bonar 

(?•) Powles v. Page, 3 C. B. 16 ; v. Mitchell, 5 Ex. 415. 

Macintyre v. Council, 1 Sim. N. S. (t) 7 Geo. 4, c. 46, § 6. 

225 & 252. (u) Ness v. Avgas, 3 Ex. 805 ; 


Bk. I. Chap. 4. The act requires that the returns to the stamp office shall 

Class 4 " be made out and be verified by the oath of one of the regis- 

SmToffice! 116 tered public officers, and shall be sent in once a year, between 
the 28th of February and the 25th of March (x). But it has 
been held that a certified copy of the return is admissible in 
evidence, although it may have been made out by a person 
calling himself" cashier," and there may be nothing to show 
that he was a public officer (//). It has also been held unneces- 
sary to prove that the return was verified by the oath of a 
public officer, as required by the act (z) ; or that the return 
was made at the proper time (a). On the other hand, it has 
been held that returns proved not to have been made in 
compliance with the act are inadmissible ; e.g., when it is 
proved that they were not made until after the 25th of 
March (&). 
Effect of return. A person returned as a member will, until the contrary is 
shown, be presumed to have been a member at the time the 
return was made and subsequently (c) ; and if two successive 
returns contain the name of the same person, the presumption 
is strong that he was a member during the whole period be- 
tween the times at which such returns were made (d). 

There is nothing in the act which makes the returns 
conclusive, either one way or the other ; and a person not 
returned as a member may be proved, not only to have 
become a member since the making of the last return, but 
to have been a member at the time of the making of that 
return (e). 

The act is silent as to the mode in which shares are to be 

see too, Dodgson v. Bell, 5 Ex. 967 ; compare this with the last case, 

Ness v. Armstrong, 4 Ex. 21 ; Bosan- where it was held that the act was 

quet v. Shortridge, 4 Ex. 699. directory only in this respect. 

(x) 7 Geo. 4, c. 46, § 5. (c) Steward v. Dunn, 12 M. & W. 

(y) Harvey v. Scott, 11 Q. B. 92 ; 655; Ex parte Prescott, Mon. & Ch. 

Field v. Mackenzie, 4 C. B. 717. 611 ; Harvey v. Scott, 11 Q. B. 106. 

(z) Steward v. Dunn, 12 M. & W. {d) Bosanquet v. Shortridge, 4 Ex. 



(«■) Bosanquet v. Woodford, 5 Q. B. (e) See Prescott v. Buffery, 1 C. B. 

2iQ w 41 ; Bank of England v. Johnson, 3 

(b) Prescott v. Buffery, 1 C. B. 41 ; Ex. 598. 


2. Registered companies. Bk. i. Chap, i 

Class !. 

By far the greatest number of joint-stock companies belong 
to this class. They are all now governed by the Companies 

arts, 1862, 18G7, 1877, 1879, 1880, 1883 (ee), and 1880. These 
acts, like those which they supersede, require for their prac- 
tical working, a public officer in each division of the United 
Kingdom. This officer (called the registrar of joint-stock 
companies) is appointed by, and, to a certain extent, is subject 
to the Board of Trade. His duty is to register the various 
documents required by the acts to be registered, and to allow 
such documents to be inspected by any one desirous of seeing 
them (25 & 26 Vict. c. 89, § 174). 

These duties will, if necessary, be enforced by man- 
damus (/). 

Registration incorporates the company (§§ 18, 191, and Incorporation 
192) ; and the registrar's certificate of registration, which he is of coml ' :iny - 
required to give, is conclusive evidence that all the statutory 
requisitions have been complied with (§§ 18 and 192) (g). 
Even therefore if they have not, still the existence of the com- 
pany as a corporate body cannot be denied in the face of the 
certificate (h) ; nor does the fact that a company was formed 
in fraud invalidate the certificate or deprive the company of its 
corporate character (i). There is, moreover, no provision for 
cancelling the registration of an improperly registered com- 
pany ; nor is it clear that there are any means of cancelling 
such registration (A). 

But the registrar has no power to extend the acts to com- Certificate of 
panies not within their scope ; and in order that his certificate Xn notion- 

(ee) 46 & 47 Vict. c. 28 is repealed 26, § 6. Cl,,S1VC ' 

except as to Ireland by 51 & 52 (h) See the last note, and Glover 

Vict. c. 62. v- Giles, 18 Ch. D. 173; Nassau 

(/) R. v. WMtmarsh, 15 Q. B. Phosphate Co., 2 Ch. D. 610; Ban- 

600 ; see, also, R. v. Registrar of wen Iron Co. v. Burnett, 8 C. B. 406 ; 

Joint Stock Companies, 10 Q. B. 839 ; Bird's case, 1 Sim. N. S. 47. 
R, v. Same, 21 Q. B. D. 131. (0 Pilbrow v. Pilbroic's Atmo- 

(g) Peel's case, 2 Ch. 674 ; Oahcs spheric Co., 5 C. B. 440. 
v. Timjuand, L. R. 2 H. L. 325 & (k) Princess of Reuss v. Bos, L. R. 

354-369 ; Princess of Reuss v. Bos, 5 5 H. L. 176, 193, 197, 202. But see 

ib. 176 ; New Bnmsivick Rail. Co. v. Glover v. Giles, 18 Ch. D. 180 as to 

Boore, 3 H. & N. 249. See as to Quo warranto. 
copies of certificates, 40 & 41 Vict. c. 



Bk. I. Chap. 4 

Class 4. 

Evidence of 

may be conclusive evidence of the incorporation of a company 
formed and registered under them, it is essential that the com- 
pany shall be one which may be duly registered ; neither regis- 
tration nor the registrar's certificate is of any avail in the case 
of a company to which the acts do not apply (/). 

The registrar's certificate, although the best, is not the only 
admissible evidence of registration. Registration may be suffi- 
ciently proved by other evidence ; for example, as against the 
company, by the production of certificates of shares sealed with 
its seal (m). But this sort of evidence cannot be relied upon 
when it is necessary to prove the incorporation of the company 
against persons not connected with it (n). 

No two companies are to be registered by the same name, or 
by names so similar to each other as to be calculated to 
deceive (§ 20) (o). But if a registered company is being dis- 
solved, and it consents to the assumption of its name by 
another company, the latter may be registered under the name 
Power to change borne by the former (§ 20) (p). In the event of two companies 
name * being inadvertently or otherwise registered by the same name 

or by two names so similar as to be calculated to deceive, the 
name of the company last registered may be changed (§ 20). 
And any registered company may change its name, with the 
sanction of a special resolution of its members, and the approval 
of the Board of Trade (§ 13). But the change of name is not 

Name of com- 

(I) See Northumberland District 
Banking Co., 2 De G. & J. 357. 
See, also, Baroness Wenlocl v. Rivi r 
Dee Co., 38 Cli. D. 534, which turned 
on a .similar provision in another 
act. Compare Princess of Reuss v. 
Bos, uU sup. As to companies 
registered under part VII. of the 
act, see Ennis v. West Clare Rail. 
Co., 3 L. R, Ir. 94, where the certifi- 
cate was held conclusive. See § 192. 

(m) Mostyn v. ( 'alcottHall Mining 
Co., 1 Fos. & Fin. 334. See Agri- 
cultural Cattle Insurance Co. v. Fitz- 
gerald, 1(5 Q- B. 432, as to actions by 
the company. The fact of registra- 
tion is there stated to have been 
proved, but hew does not appear. 

The certificate, however, was not 

0) See R. v. Frankland, L. & C. 
276, as to the proof required in 
criminal cases, and compare R. v. 
Langton, 2 Q. B. D. 296. 

(o) See R. v. Registrar of Friendly 
Societies, L. E. 7 Q. B. 741. As to 
one company restraining the regis- 
tering of another in a name like its 
own, see below. 

(p) Advantage is taken of this 
when it is desired to reconstruct a 
registered company. The company 
dissolves, and a new company is 
formed with a new constitution, 
but with the same name as the old 
company. See infra, bk. iv., c. 2, § 4. 


complete until a new certificate of incorporation has been Bk. I. Chap. 4. 

1 Class l. 
issued (fj). ' 

It is further provided that such existing companies as 
register with limited liability, shall add the word limited to 
their former name (§ 183, cl. 3, and § 190). But except in cases 
specially provided for, a company once registered under a given 
name cannot require to be registered under a new name (r). 
But an unlimited company may be converted into a limited 
company (see the Companies act, 1879, 42 & 43 Vict. c. 76). 

A mere change of name does not affect a company's rights 
or obligations (§§ 13, 20, and 194). But as will be seen here- 
after, the consequences of registering an existing company 
under the acts are extremely important. 

One company can restrain persons from registering another com- Rival companies. 
pany under a name so like its own as to he calculated to deceived); 
so a company which has been already registered under such a 
name can be restrained from carrying on business under it (t). 

The registrar may remove from the register the name Defunct com- 
of any company which has ceased to carry on business («). 

With respect to the registration of companies under the act Scope of act of 

1 fif:0 

of 1862, it will be found that its provisions apply, first to all 
companies formed under it (r) ; secondly, to some companies 
existing when the act came into operation Cr) ; and, thirdly, to 
some companies formed subsequently to that date, but not 
under the provisions of the act itself (#). It will further be 
seen that many companies may be wound up under it although 
not registered under it {2). 

((/) Shackleford v. Dangerjield, L. The Home and Colonial Assurance 

B. 3 C. P. 407. Co., 33 Beav. 548 ; The London 

(/•) R. v. Registrar of Joint Stock Assurance Co. v. The London and 

Cos., 10 Q. B. 839. Westminster Insurance Corporation, 

(s) Hendriks v. Montagu, 17 Ch. 9 Jur. N. S. 843, V.-C. S. ; The 

D. 638. London and Provincial Law Assnr- 

(t) Merchant Banking Co. of London ance Society v. The London and Pro- 

■ v. Merchants' Joint Stock Bank,9 Ch. vincial Joint Stock Life Ass. Co., 17 

D. 560. See further as to one com- L. J. Ch. 37, N. S. 

pany suing another for taking its (u) 43 Yict. c. 19, § 7. C&J&^ M^sj^t^ -W^. th-tlL^d 

name with a colourahle imitation, (v) See the first four parts of theact. 

Lee v. Haley, 5 Ch. 155 ; Braham v. (x) Seethe sixth and seventh parts 

Beachim, 7 Ch. D. 848 ; Lawson v. of the act. 

The Bank of London, 18 C. B. 84 ; (y) See § 180. 

The Colonial Life Assurance Co. v. (z) See part eight of the act. 

L.C. I 



Bk. I. Chap. 4. 
Class 4. 

when compul- 

Carrying on 

business. ■ 

For gain. 

Registration is compulsory — 

1. In the case of insurance companies completely registered 
under 7 & 8 Vict. c. 110 (see § 209 of the act of 18G2) (a). 

2. In the case of companies which ought to have registered 
under the repealed acts of 1856 — 1858, but which were not so 
registered (§ 209). This class includes, 1, all companies regis- 
tered under 7 & 8 Vict. c. 110, except insurance companies (b) ; 
2, all chartered banking companies formed under 7 & 8 Vict, 
c. 113 ; and, 3, Scotch and Irish banking companies formed 
under 10 Vict. c. 75 (c). 

3. In the case of banking partnerships of more than ten 
persons, formed on or after the 2nd of November, 1862, unless 
formed under some other act of Parliament, or under letters 
patent (§4). 

4. In the case of companies, associations, or partnerships of 
more than twenty persons (d) formed on or after the 2nd of 
November, 1862 (e), for the purpose of carrying on any other 
business (except banking) for gain by the company, &c, or the 
members thereof, unless they are formed under some other act 
of Parliament, or under letters patent, or unless they are com- 
panies engaged in working mines within and subject to the 
jurisdiction of the Stannaries (§ 4) (/). 

Associations of more than twenty persons carrying on busi- 
ness by agents are within the act(/y). But persons who are 
only the cestuis que trustent of others who carry on business as 
principals, do not themselves carry on business within the 
meaning of the act (h). 

What amounts to carrying on business for gain has been 

(a) This gets rid of London 
Monetary Co. v. Smith, 3 H. & N. 
543, and Lond. and Provincial Prou. 
Soc. v. Ashton, 12 C. B. N. S. 709. 
The first of these cases was clearly 

(6; See 20 & 21 Vict. c. 14, §§ 26 
& 27. As to insurance companies, 
see the cases in the last note, and 
Bank of London, &c, Lns. Assoc, G 
Ch. 421. 

(c) See 20 & 21 Vict. c. 49, §§ 

(d) I.e. 20 when formed or by 
subsequent increase, Ex parte 
Poppleton, 14 Q. B. D. 379. 

(e) As to older companies, see 
Shaw v. Simmons, 12 Q. B. D. 117. 

( /) The j urisdiction was extended 
to Devonshire by 18 & 19 Vict. c. 32. 

(;/) See Harris v. Amery, L. R. 1 
C. P 148, and the next note. 

(/<■) Smith v. Anderson, 15 Ch. D. 
247, overruling Sykes v. Beadon, 11 
Ch. D. 170. 


much discussed (i) : and it is now settled thai mutual marine Bk. I. Chap i. 

Class 4. 

insurance companies (,/) and mutual loan societies (k) are 

within the act; but freehold Land societies are not (I). 

Registration appears to be impossible only in the following Registration 

when impo 
eases, VIZ. : 

1. In the case of companies and associations of less than 
seven members (§6). 

2. In the case of companies and associations having the 
liability of their members limited by act of Parliament or 
letters patent, and not having a capital divided into shares or a 
transferable stock (§ 179, cl. 1, and § 181), e.g. mutual incor- 
porated societies, and learned societies, such as the Royal 

3. In the case of Trade Unions (;»)• 

4. In the case of foreign incorporated companies (//). 

Companies which had been alread}' registered under the Companies al- 
repealed acts of 1856 — 8 need not register under the act of nn ^ T tracts 
1862, but they may do so; and whether tiny do or do not re- "' l856 8 " 
gister they are subject to its provisions, except that their own 
regulations remain unchanged (compare §£ 176, 177, 206, 
208) (o). For some purposes (see §§ 176, 177) however, a 
distinction is made, in the case of non-re-registration, between 
companies formed and registered under the acts of 1856 — 
1858 and those registered but not formed under them. The 
former class are placed substantial^' on the same footing as 
companies formed and registered under the act of 1862, the 
old regulations being preserved (§§ 176 and 206) ; whilst the 
latter class are placed on the same footing as other existing 
companies which have registered under the act of 1862 (§ 177). 

The other clauses which authorise, but do not imperatively Registration 

when optional 

(i) See the last note and the next (m) 34 & 35 Vict. c. 31, § 5. 

three. (?<) Bulkeky v. Schutz, 3 L. R. P. 

(j) Padstoto Total Loss Assoc, 20 C. 764 ; Bateman v. Service, 6 App. 

Ch. D. 137 ; Ex parte Hargrove, 10 Ca. 386. 

Ch. 542. (o) See Torquay Bath Co., 32 Beav. 

(k) Jennings v. Hammond, 9Q.B. 581. Of course without re-registra- 

D. 225 ; Shaio v. Benson, 11 Q. B. D. tion such a company cannot be con- 

563 ; Ex parte Poppleton, 14 Q. B. D. verted from an unlimited into a 

379. limited company. 

(0 Be Siddall, 29 Ch. T). 1. 

I 2 



Bk. I. -Chap. 4. require, registration, are the 6th and the 180th. These appa- 

Class 4. . 

- rently authorise any seven or more persons, associated for any 
lawful purpose, to form a company by registration with the ex- 
ceptions above mentioned {p). The circumstance that the 
persons are foreigners and intend to carry on business abroad 
does not preclude registration (q). 
Option to regis- With a few exceptions, eveiy company capable of being 

ter with limited . . - 

liability, or registered may, at the option ot its members or promoters, be 
registered either with or without limited liability (§§ 6 and 
180) ; and, in the first case, with the liability limited either by 
shares or by guarantee (§§7 and 180). The exceptions are as 
follows : 

1. No company, having the liability of its members limited 
by act of Parliament or letters patent, can register as an un- 
limited company, or as a company limited by guarantee (§ 179, 
cl. 2). 

2. No company that has not a capital divided into shares, or 
a transferable stock, can register as a company limited by 
shares (§ 179, cl. 3, and § 181). This applies to most cost- 
book mining companies. 

Further a company can be formed with limited liability, but 
with the liability of its directors or managers unlimited (r). 

Having made these preliminary observations, it is proposed 
to consider the formation of registered companies and the 
evidence b} r which a person can be shown to be a member of 
them. For this purpose it is not necessary to distinguish 
limited from unlimited companies, but it is necessary to divide 
registered companies into 

1. Companies formed and registered under the act of 1862. 

2. Companies registered under that act, but not formed 
under it. 

(p) The joint efl'ect of § 179, cl. 1, not intended. See Ennis v. West 

and of §§ 180 & 181, seems to be Clare Bail. Co., 3 L. R., Ir. 94. 
that railway companies incorporated (q) Princess of Keuss v. Bos, L. R. 

by act of Parliament, and having a 5 H. L. 176, affirming General Co. for 

capital divided into shares or a Promoting Land Credit, 5 Ch. 363. 
transferable stock, may be registered (r) 30 & 31 Vict. c. 131, § 4. 

under the act. This was probably 


Bk. I. Chap. 4. 
1. Companies formed and registered under tin Companies act, L862. Cla ss >• 

Any seven or more persons associated for any lawful pur- 
pose may form ;i company under this ad (§ 6). Jt is not even 
necessary that gain shall he the object of the company (s). 

A company is formed under the act of 1862, by the registra- Memorandum of 
lion of a memorandum of association, bearing a deed .stamp, M 
and subscribed by seven or more persons, in the presence of, 
and attested by one witness at least (see §§ 8 — 11 and 17 and 
18, and the forms in sched. 2). 

This memorandum must contain, 1, the name of the pro- 
posed company; 2, the part of the United Kingdom in which 
the registered office of the company is to be ; and 3, the objects 
for which the company is to he established (§§ 8—10, and 
sched. 2). If the company is to he limited by shares, the 
memorandum must also state, -1, that the liability of the 
members is limited; and, 5, the amount of proposed capital, 
and the shares into which it is to he divided (§ 8 and sched. 2, 
form A.). If the company is to he limited by guarantee, the 
memorandum must contain, in addition to the three things 
first above mentioned, a declaration that each member will, if 
necessary, contribute to a specified amount on the winding up 
of the company (§ 9, and sched. 2, forms B. and ('.). If the 
company, whether limited or unlimited, has a capital divided 
into shares, each subscriber to the memorandum must write 
opposite his name, the number of shares he takes, and he 
must take one at least (§§8 and 14). 

A statement of the amount of nominal capital to he raised Stamp. 
by shares must he sent to the registrar and be stamped with a 
stamp duty of 2-5. per 100/. of capital, see 51 Viet. c. 8, § 11. 

The memorandum of association must, in the case of an Articles of 
unlimited company, and of a company limited by guarantee, ass 


(s) See 30 & 31 Vict. c. 131, § 23. for their object, 7,'. v. Wldtmarsli, 15 

No questions, therefore, can arise Q. B. 600 ; Bear v. Bromley, 18 ib. 

under the act of 1862, similar to 271 ; Moore v. Rawlins, 6 C. B. X. 

those which arose under 7 & 8 Vict. S. 289 ; to companies, the forma- 

c. 110. See as to the application of tion of which was commenced before 

that act to projected railway com- 1st Nov. 1844, Shaw v. Holland, 15 

p.mies, Abbott v. Rogers, 16 C. B. M. & W. 136. 
277 ; to companies not having gain 



Table A. 

Bk. I. Chap. 4. an( | mav { n the case of a company limited by shares, be accom- 

Class 4. - . l / . . 

pained, when registered, by articles of association, prescribing 

regulations for the company (§ 14, and sched. 2, forms B. and 
C). These articles must be printed and be stamped with a 
deed stamp, and be signed by the subscribers to the memo- 
randum of association, in the presence of, and attested by one 
witness at least (§§ 14 and 16). In the case of a company 
having a capital divided into shares, and not being limited by 
shares, the articles must state the amount of the proposed 
capital ; and in the case of a compan} T not having such a capital, 
the articles must state the number of members with which the 
company proposes to be registered (§ 14). 

The first schedule of the act, table A., contains a set of 
regulations which may be adopted, wholly or in part, by any 
company, and which apply to companies limited b} r shares, 
unless the contrary is expressed in their registered articles 
(§§ 14 and 15). These regulations closely resemble those con- 
tained in table 13., in the repealed act of 1856. They have 
been framed with care, and they should be adopted, as far as 
possible, in all cases. The Board of Trade has power to alter 
them, but not retrospectively (§ 71). 

The memorandum of association, and the articles, if any, are 
to be delivered to the registrar of joint-stock companies, who 
is required to retain and register them (§ 17). Certain fees 
are payable upon their registration (§ 17). After their regis- 
tration, the registrar is required to certify that the company is 
incorporated, and in the case of a limited company, that it is 
limited ; and his certificate is conclusive evidence that all the 
requisitions of the act, in respect of registration, have been 
complied with (§ 18) (0- 

The memorandum of association and the articles of asso- 
ciation ought to be consistent with each other, and they ought, 
if possible, to be construed so as to make them consistent (u). 
But if the two conflict, the articles must give way to the 
memorandum, for that is the more important document of the 
two, and cannot be altered except in certain particulars specified 

(t) Ante, p. 111. D. 75 ; South Durham Brewery Co.. 

(u) See Felgate's case, 2 De G. J. 31 Cli. D. 2(51. 
& Sin. 456 ; Andersons case, 7 Ch. 

Registration of 
stud articles. 

Certificate of 
re ristration. 

Construction of 

aud articles. 


in the statutes (.r). Many cases illustrating this general rule Bk. I. Chap. i. 
will be nut with hereafter when considering the powers of 
directors and majorities, and the Liabilities of the subscribers 
of the memorandum (y). Moreover, articles of association, 
w bich arc inconsistent with the Companii s acts, arc invalid (2). 

The articles of association may be varied by special resolu- Varying articles 
tion (§ 50), and the company cannot, deprive itself of its power 
to alter them (a). 

The act in substance declares that the subscribers of the Who are mem- 
memorandum of association (§§ 18 and 23) (6), and all persons 
who have agreed to become members and whose names are 
entered in the register of members, shall be deemed members 

of the company (§ 23). It is conceived that persons who Subscribers of 
,. ., i •, r ■ , ■ ■ -. memorandum. 

sign copies ot the memorandum before it is registered are 

members under this act, as they were held to be under the act 

of 1856 (c). 

It is very difficult to see how any person who signs the 
memorandum of association can he held not to be a member. 
But in Frigate's case (d), a person who had signed the memo- 
randum and articles of association was held not to he a contri- 
butory, as the articles he had signed had been tampered with 
before they were registered. He was held not to be bound by 
the articles, and not being bound b}' them he was held not 
bound by the memorandum. 

With respect to other persons it is to be observed that no Other member?. 
particular form of agreement is necessary (e) ; but a question 

(x) See § 12 of the Companies act, (k) Signature by an agent is suffi- 

18(52, and §§ 8, 9 & 21 of the (.Van- cient, Whitley Partners Limited, 32 

panies act, 1867, and § 5 of the Com- Oh. Div. 337. 

panics act of 1877, and the Com- (c) New Brunswick Bail. Go. v. 

panies act, 1879. Bbore, 3 H. & N. 24!). 

(//) See particularly Guinness v. (d) 2 De G. F. & J. 456. This 

Land Corporation of Ireland, 22 Ch. case turned on the act of 1836, but 

D. 349 ; Aslibury Rail. Carriage Go. there does not appear to be any 

v. Iilche, L. R. 7 H. L. 653 ; Dent's difference between that act and the 

case, 8 Ch. p. 776. act of 1862, so far as this subject is 

(2) Trevor v. Whitworth, 12 App. concerned. 

Ca. 409, the case of an article em- (>) This gets rid of New Bruns- 

powering a company to buy its own wick Rail. Co. v. Muggeridge, 4 If. 

shares. & N. 160 & 580. See Bog Lend 

(a) Walker v. London Tramways Mining Co. v. Montague, 10 C. 13. N. 

Co., 12 Ch. D. 705. !S. 481. 



Bk. I. Chap. 4, 
Class 4. 

Several classes 
of members. 

Certificate of 

Register of 

Correction of 
register, § 35. 

may arise on tins act, as on the Companies clauses consolida- 
tion act, whether a person may not be a member although his 
name is not on the register. In considering this question 
regard must be had to the right of companies to put persons 
on the register (/), to the i:>rovisions for its rectification^/), 
and to the extent to which a person may have acted and been 
treated as a member (h). 

There is nothing in the statute to prevent the existence of 
two or more classes of members (?'), but as will be seen here- 
after (in Book III.) the rights of each class must be respected, 
and this consideration may prevent the creation of another 
class with special privileges. 

A certificate under the seal of the company, stating that any 
shares or stock are held by a member, is prima facie evidence 
of his title to the shares or stock therein specified (§ 31) (A). 

Every company registered under the act is bound to keep at 
its registered office (§ 82) a register of its members, and a 
duplicate of any colonial register which it may keep under the 
provisions of the Companies (colonial registries) act, 1883 (/). 
The register must contain the names and addresses, occupa- 
tions, and the number of the shares, if any, held by the 
members, and the amounts paid, or agreed to be considered as 
paid, in respect of such shares, and the dates at which the 
members were registered, and the dates at which they ceased 
to be members (§ 25). Xo notice of any trust is to be entered 
on the register (§ 30) (m). The register is prima facie evidence 
of all matters directed or authorised to be inserted therein 
(§ 37) (n). 

The 35th section provides for the rectification of the register, 
and is extremely important (o). Its effect is that if the name 

(/) Ante, p. 46. 

(g) §§ 35 & 98. 

(h) Ante, p. 47 et seq. 

(i) IV i 'nst ones case, 12 Ch. D. 239, 
where there were shareholders ami 
assurance members not shareholders. 

(A-) The right to demand this cer- 
tificate is not given by the act, but 
only by Table A, Nos. 2 and 3. See 
as to these certificates, ante, p. 64. 

(/) 46 & 47 Vict, c 30. 

(m) See as to this, Bradford Bank- 
ing Co. v. Briggs, 12 App. Ca. 29. 

(n) See, as to the register when 
fullj- paid-up shares have been re- 
placed by share warrants transfer- 
able by delivery, 30 & 31 Vict. c. 
131, § 31. 

(o) See on the correction of 
registers generally, ante, pp. 61-63. 


of any person is without sufficient cause entered in or omitted Bk. I. Chap. 4. 

Class 1. 

from the register of members, or if default is made or unneces- 
sary delay takes place in entering on the register the fact of register under 

any person having ceased to he a member of the company, he § 3o " 
or any member of the company or the company itself may 
obtain an order for the rectification of the register. The order 
may be obtained from any division of the High Court; or in 
the case of a colonial register from any competent court in the 
colony where such register is kept (_/;). 

A difference of opinion has been expressed as to the correct 
interpretation of this section. Some consider that under it 
the register may be rectified whenever it can be shown by any 
person who is on or off the register himself that some other 
person ought as between themselves to be in his place (7) ; 
whilst others consider that the section does not admit of so 
wide an interpretation, being confined to the cases specified in 
its commencement (r), viz. : — 

1. To cases where the name of a person is without sufficient 
cause entered in or omitted from the register. 

'2. To cases where default is made or unnecessary delay takes 
place in entering on the register the fact of any person having 
ceased to be a member of the company. 

The more restricted interpretation, it will be observed, 
renders the section inapplicable except where the company 
fails in discharging the duty imposed upon it of keeping a 
proper register. 

It must be borne in mind that before a company is being 
wound up its register is much more readily rectified than after 
the winding up has commenced and the rights of creditors 
have to be considered. The rectification of the register in 
connection with the settlement of the list of contributories 
will be considered hereafter ; in the present place those deci- 
sions only will be referred to which relate to the rectification of 
the register of a going company. 

(p) 46 & 47 Vict. c. 30, § 3 (3). cos, , 2 Ch. 431. 

(q) See Ex, parte Shaw, 2 Q. B. D. (/•) Ex parte Ward, L. R. 3 Ex. 

463 ; Ward and Garfit's case, 4 Eq. 180 ; Shejjherd's case, 2 Cb. 16 ; and 

189 ; Musgrave and Hart's case, 5 see Lord Cairns' judgment in Ward 

Eq. 193; and the judgment of and Henry's case, 2 Ch. 431 ; Marino's 

Turner, L. J., in Ward and Henry's case, 2 Ch. 596. 


Bk. T. Chap. 4. Tlie 35th section not only authorises the correction of mis- 
Class 4. 
takes but also the determination of important conflicting rights, 

going further in this respect than the corresponding section of 
the Companies act, 1856 (s). As however trusts are not 
noticed (§ 30) the title to be investigated is the legal title or 
the right to acquire it (t). If this legal title is clear, and there 
is no difficult question of fact to be investigated, the Court 
will rectify the register without directing any action to be 
brought (») ; but the Court has a discretion as to whether it 
will interfere summarily under the act or direct an action, and 
will be guided by the nature of the facts in dispute and by the 
desirability of having them investigated by a jury (a;). The 
circumstance, however, that the company has itself rectified 
the register does not preclude the Court from ordering it to be 
rectified ; an order of the Court being often of great import- 
ance to the applicant^). 
Instances of Registers will be rectified at the instance of persons who 

have been registered as members without having entered into 
any contract to take shares (z) ; so where the contract they 
have entered into is void (a) ; so where the contract being 
voidable it has been duly avoided by the alleged shareholder. 
Thus registers have been rectified where persons have taken 
shares on the faith of a prospectus with which the company's 
memorandum of association does not correspond (b) ; so where 
a person applied for shares on the faith of particular persons 

(s) As to which, see British Sugar 669. 

Refining Co., 3 K. & J. 408. (;.) Los? case, 6 X. E. 327 ; Higg's 

(t) Ex parte Sargent, 17 Eq. 273 ; case, 2 H. & M. 657 ; Martin's case, 

Ex parte Parker, 2 Ch. 685. ib. 659, where the name had been 

(u) Ex parte Shaw, 2 Q. B. D. removed already ; Baily's ease, 5 

463. Eq. 428 ; 3 Ch. 592 ; Somerville's 

(.'•) See the last case ; Ashew's case, case, 6 Ch. 266, 271. 

9 Ch. 664, where an action was (a) Stace and Worth's case, 4 Ch. 

directed to try a question of fraud ; 682. . 

Simpson's case, 9 Eq. 91, where a bill (b) Stewards ease, 1 Ch. 574; 

was directed to be filed. The dim- Webster's case, 2 Eq. 741 ; Dowries 

eulty here mainly turned on the v. Ship, L. R. 3 H. L. 343 ; and 

construction of documents, and qu. Ship's case, 2 De G. J. & Sm. 544; 

the advantage of directing an action Breckenridge's case, 2 Hem. & M. 

in such a case. 642. See ante, p. 19 et seq. 

(//) Martin's ruse, 2 Hem. & M. 


named in the prospectus being directors, and such persons l;k - ' Chap. 1. 

< 'lass 1. 

refused to become directors (c) ; so where a person lias been 

induced by the fraud of the company to become amember(d) ; 
so where the company refuses to register a transferee, to whom 
the company cannot object ('•)• 

Again, where shares are transferred to an infant the infant 
can have the register rectified whilst he is an infant (/), or on 
his coming of age, providing lie lias not accepted the shares (g) ; 
and the company itself can obtain an order rectifying the 
register in such cases (//) if it has not accepted the infant as a 
shareholder knowing the facts (7). So where a person has by 
misrepresentation or fraud induced the company to register 
him as a shareholder, the register will be rectified at the 
instance of the company, if it applies promptly (A;), and if third 
parties have not dealt with the person registered and have not 
acquired rights on the faith of his being a shareholder (/). 

So where shares intended to be issued as fully paid up, have 
been inadvertently issued as not paid up, the register has been 
rectified under this section (in). 

The question whether a vendor or a purchaser of shares is 
entitled to be registered in respect of them can also be deter- 
mined upon an application to rectify the register (ti). 

On the other hand, a duly registered member cannot have Application to 
his name struck off the register (o) ; and no person is entitled re 

(c) Andersons case, 17 Cli. D. 373. noticed ante, p. 54. Compare 

(d) Smith's case, 2 Ch. 604, and 4 Askew's case, 9 Ch. 664, where an 
H. L. 64 ; Paw!<\< ens,, 4 Ch. 4'.)1 ; action was directed. 

McNiell's case, 10 Eq. ."303 ; Forts ( m ) Darlington Forge Co., 34 Ch. 

ease, 5 Eq. 118. D. :>22 ; Ex parte Shaw, 18 Eq. 

(e) See Ex parte Parker, 2 Ch. OS."), 16; Ex parte Thomas, ib. 17 note. 
and infra, Bk. III., c, 4, § 5, Transfer It seems that in these cases the com- 
of shares. P'my may rectify its own mistake ; 

(/) See Mann's case, 3 Ch. 459 n. ; Hartley's case, 18 Eq. 542, and 10 

Cappers case, ib. 458. Ch. 157 ; Re Etna Ins. Co., Ir. B. 7 

(g) See Hart's case, 6 Eq. 512 ; Eq. 264. See as to shares issued at 

Wilson's case, 8 Eq. 240. a discount, Bail. Time Tables Pub. r. 

(h) See Symon's case, 5 Ch. 298. Co., W. N. 1888, 239.{^o^uJUb ^j^jjp ^u. oT ^T^ 

(i) Parson's case, 8 Eq. 656. (ri) Ex parte Shan; 2 Q. B. D. ~ 3t * ( °- 

(/.•) See Ex parte Kintrea, 5 Ch. 95. 403. 

(I) See, as to tins, Pallia and San (o) Ex parte. Ward, L. B. 3 Ex. 

Francisco Bail. Co., L. B. 3 Q. B. 180. 
584, and other cases of that sort 



Bk. I Chap. 4. to have his name put on the register until lie has complied 

Class 4. j. o j. 

- with all conditions precedent, e.g., proved his title to his shares 
in the manner required by the company's regulations {p) ; and 
where a company is required to register a transfer of shares 
on which it has a lien, that lien must be first discharged (q). 
Neither can a person who was entitled to be on the register 
have it rectified in his favour if he has allowed some one else 
to be registered in his place, and such person has transferred 
his share to a bond fide purchaser (r) ; and as will be seen 
hereafter, under the head " Contributories," delay in applying 
to the Court is often fatal to the application (s). Nor can a 
company which has, when prosperous, persistently refused to 
register a person, obtain an order to register him when the 
company is in difficulties (t). 

If a person has suffered damage by reason of a company 
improperly excluding him from or retaining him on its register, 
the company will be ordered to pay it (u). But the company 
will not be liable to pay any special damage arising from 
unusual circumstances of which it had no notice (x). 

So long as the company is a going concern, the Court has 
apparently no jurisdiction under the 35th section, to order 
costs to be paid by airy one except b} r the company (y). But 
this observation does not apply to the costs of an appeal {z). 

If the application is made after the liquidation has com- 
menced, the Court has jurisdiction to order costs to be paid 
as it may think fit (a). 

The jurisdiction conferred by this section on the Vice- 
Warden of the Stannaries to rectify the register of companies 




(p) East Wheal Martha Mining 
Co., 33 Beav. 119. 

(a) See London, Birmingham, dr., 
Bank, 34 Beav. 332 ; Stockton Mal- 
leable Iron Co., 2 Ch. D. 101. 

(r) London and Provincial Tele- 
graph Co., 9 Eq. 653. 

(s) See Scottish Petroleum Co., 23 
Ch. D. 413. 

(t) See Sichell's case, 3 Ch. 119 • 
NicoVs case and Tufnell and Pon- 
sonby's case, 29 Ch. D. 421. 

(//) New Quebrada Co., 36 L. J. 
Ch. 903. 

(./') Sk inner v. City of Loud mi 
Marine Ins. Corp., 14 Q. B. D. 882. 

(»/) Ex parte Sargent, 17 Eq. 273 ; 
Ex parte Kintrea, 5 Ch. 95. 

(a) Ex parte Shaw, 2 Q. B. D. 463. 

(a) See Ex parte Kintrea, 5 Ch. 
95. In Anderson's case, 17 Ch. D. 
373, and in Wood's case, 15 Eq. 236, 
the company "was ordered to pay 
costs as between solicitor and client. 

];i Q] - I BE. 125 

within tin; district of the Stannaries, does not exclude the Iik - i- Chap. i. 

( ! 1 .■ i l 

jurisdiction of the High Court for the same purpose (6). 

Notice of an order rectifying the register must in most cases 
be given to the registrar (<■). 

By § 98 of the act of 18G2 it is provided thai when a Correction oi 

company is being wound up. the Couri winding it up shall"'- 1 ': 1 '''""" . 
L J ° L e» j winding up of 

have power t<> rectify the register of members; and this power company. 

is constantly acted upon (//). In determining who are contribu- 
tories, the actual state of the register is therefore of much less 
importance than the state in which it ought to be. 

A company can correct its own register where a Court would 
compel it to do so (e). 

Every person, whether a member or not, has a right to Inspection of 
inspect the company's register, and to have a copy of it, or of Ies ' s 
any part of it, on payment of a small fee (§ 32). Every 
member is entitled to inspect the register gratis ; other per- 
sons may be required to pa}' one shilling (§ 32). The register 
may be temporarily closed (§ 33). 

The act does not expressly require the register to be sealed Obsorvatious on 
with the company's seal ; and a book kept as required by § 25 regU> e 
may, it is conceived, be evidence under § 37, though not 
sealed (/). 

In addition to the register of members above referred to, Annual list and 
every company having a capital divided into shares is bound Sl 
under penalties to keep in a separate part of its register of 
members, and once a year at least to make out and transmit 
to the registrar of joint-stock companies, a list of its members 
and late members, and a summary showing the amount of the 
company's capital, and the number of shares into which it is 
divided, and the number of shares issued and forfeited, and 
the amount of calls made, received and unpaid (§§ 26 and 27, 

(h) Tlie Pcnhale and Lomax, dc, than that conferred by § 35. See 

Co., 2 Ch. 398. SichelVs case, 3 Ch. 119 ; Reese River 

(c) § 3G. Co. v. Smith, L. R, 4 H. L. 64. 

(d) No special application to (e) Hartley's case, 18 Eq. 542, and 
rectify the register is necessary in 10 Ch. 157. See ante, pp. 63, 123. 
these cases ; Brechenridge s case, 2 (/) See Cornwall, dc, Mining Co. 
Hem. & M. 642. The power con- v. Bennett, 5 H. & N. 423, and see 
ferred by § 98 is not more extensive ante, pp. 57-60. 


Bk. I. Chap. 4. and schecL 2, form E.) (r/). And every company not having a 
Class 4. . ' . . 

capital divided into shares is bound to keep at its registered 

office a register of its directors and managers, and to send a 
copy of such register to the registrar of joint-stock companies, 
and to notify all changes amongst them to him (§§ 45 and 46). 
When share warrants transferable to bearer have been issued 
under the Companies act, 1867, the annual return must be 
varied as required by that act (h). And when any company 
has reduced its capital under the Companies act, 1880, the 
annual return must contain the particulars required by sect. 6 
of that act (/). 
Inspection. ' These documents when registered are open to the inspection 

of every one on payment of a small fee (§ 174, cl. 5 ; see also 
as to their inspection, § 32). 

2. Companies registered under the Companies act, 1862, hut not formed 

under it. 

Little need be said with respect to the formation of com- 
panies which may be registered under the act of 1862, but 
which are not formed under its provisions. Such companies, 
if created already, must have been formed either under acts 
now repealed, or in one of the various methods which have 
been considered in preceding pages ; and companies, if created 
hereafter, but not under the act, must, as the law at present 
stands, be formed in one or other of the same methods, that 
is to say, under some special act of Parliament, or under a 
royal charter or letters patent, or, if for working mines in 
Cornwall or Devonshire, on what is called the cost-book 

It has been ahead} 7 seen that registration, under the act, of 
companies not formed under it, is in some cases compulsory, 
in some impossible, and in others optional (A;). With respect 
to existing companies which are required to register, and which 
omit so to do, the consequences of non-registration are serious ; 

(a) See as to these sections and as and Barton, 10 L. R. Q. B. 329. 
to the powers of magistrates under (h) See 30 & 31 Vict. c. 131, § 32. 

§ 27, Briton Medical and General (i) 43 Vict. c. 19, § G. 

Life Assoc., 39 Ch. D. 61 ; Gibson (k) Ante, p. 114 et sea. 


for, first, such companies cannot sue (I) ; secondly, no divi- Bk. LChap. 4. 

Class 4. 

dends can be lawfully paid to their shareholders ; and, thirdly. 

each of their directors becomes liable to a penalty of 51. per 
day (§ 210) (»). 

Companies not formed under the act but capable of being Registration of 
registered under it, may, subject to certain restrictions and naaiea with 
qualifications (see §§ 179— 188) (h), be registered either with Umited liabii:t - v 
or without limited liability (§ 180) ; and such liability, if 
limited, may be limited either b}' guarantee or by shares 
(§ 180) (o). 

Every company when registered becomes incorporated under Effect of 
the act (§§ 191 and 192). The incorporation, however, does 1Lgls 
not deprive the company of its property or acquired rights 
(§ 193), nor discharge it from its debts or other liabilities 
(§ 194) (;;). But after registration no execution upon a judg- 
ment against the company can be issued against its members 
(§ 195). The creditors, therefore of an existing company 
must, after its registration, proceed to wind up the company, 
if they cannot obtain payment of their debts by execution 
against the propert}' of the company (q). 

Upon compliance with certain requisitions mentioned in the 

(/) Accordingly it was held in Vict. c. 110, and registered -with 

the case of the Waterloo Tnsur. Co., limited liability under 18 & 19 

31 Beav. 5S6, that an insurance Vict. c. 133, was held not to be 

company could not petition to be discharged by such registration. 

wound up before it was registered. (</) The effect of registration on 

(m) A company required to the liabilities of members will be 

register under the act by § 209, considered" hereafter. It has been 

and registered accordingly, is in held that § 194 does not affect the 

the same position as if it had been question who ought to be contri- 

registered voluntarily, Ramsay's case, butories on the winding up of the 

3 Ch. D. 388. company, Fountain's case, 11 Jur. 

(h) § 1S2 is repealed, and a sub- X. S. 553 ; and that § 195 does not 

stituted section enacted by the Com- prevent a shareholder in a cost-book 

panies act, 1879, 42 & 43 Vict. c. 1V>, mining company, who had retired 

§ 6. before the registration, from being 

(0) A company registered as 1111- sued in respect of a debt contracted 

limited may be afterwards registered whilst he was a shareholder ; Lanyon 

as limited under the Companies act, v. Smith, 3 B. & Sm. 938 ; Harvey v. 

1879. Clough, 2 N. R. 204. As to what 

(p) See Groux's Soap Co. v. Cooper, companies cannot register, see ante, 

8 C. B. N. S. 800, where a surety to p. 115. 
a company registered under 7 & 8 


Bk. I. Chap. 4. act, and which need not he here specified (see §§ 109, 179, and 

Class 4. ... 

183 — 8), the registrar is required to certify that the company 

is incorporated under the act, and in the case of a limited 
company, that it is limited (§ 191) ; and his certificate is con- 
clusive evidence that all requisitions have been complied with, 
and that the company is authorised to be registered as a 
limited or unlimited company, as the case may be (§ 192) (r). 

Change of name. An existing compare cannot, apparently, change its name 
on registration, except by adding the word " limited " to its 
former name. (Compare § 183, cl. 3, and § 190.) After 
registration, however, it has the power of changing its name 
as if it were formed under the act. (See §§ 12, 13, 20, and 
196) (s). 

Membership in The question who is a member in a company registered, 
companies, but not formed under the act of 1862, depends upon the consti- 
tution of the particular company, and must be determined upon 
the principles which have been already considered (see § 196). 
With respect, however, to companies governed by the repealed 
acts of 7 & 8 Yict. c. 110, 7 & 8 Vict. c. 113, and 19 & 20 
Vict. c. 47, it may be useful to add a few observations. 

7 & 8 Yict. Companies formed under 7 & 8 Yict. c. 110, were incor- 

porated by registration, but before being so incorporated they 
passed through a preliminary state, viz., that of provisional 
registration, the object of which was to enable the public to 
ascertain the nature and objects of the proposed company and 
the persons who projected it. Provisional registration did not 
incorporate the company or its promoters (t), nor did it affect 
their liability for each other's acts (u). A certificate of com- 
plete registration was necessary to form and incorporate the 
company ; and before this could be obtained a deed of settle- 
ment containing certain covenants and particulars specified by 
the act was required to be executed by at least one-fourth of 
the subscribers to the company. The certificate of complete 
registration was conclusive evidence that all the requisitions of 

(r) See, as to this certificate, ante, (t) See I?, v. Whitmarsh, 14 Q. B. 

pp. Ill, 112. 803. 

(s) See as to changing name, ante, (u) See Reynett v. Lewis, and 

p. 112 ; and as to becoming limited, Wyld v. Hopkins, 15 M. & TV. 517 ; 

see the Companies act, 1879. Walstal v. Spottiswoode, ib. 501. 


the act had been duly complied with (x). The act defined a 1;k - T - ( lia P- 4 - 

I lass 4. 

shareholder to mean any person entitled to a share, and who 

had executed the deed of settlement or a deed referring to it; 

and it was held that no person was a shareholder who had not 

executed such deed (y). 

< bartered banking companies were formed under the repealed Chart red bank- 
ing companies, 
act of 7 & 8 Yict. c. 113, by letters patent and a deed of settle- 7 k 8 Vi ,. t 

merit set forth in it. This act contained no definition of the c - llj - 
word shareholder, but persons whose names were returned as 
shareholders to the stamp office pursuant to the aci weveprimd 
fad i- liable as shareholders (c). 

Companies were formed under the acts of 1856-8, as under J.-'.r.t Btock 
the act of 1862, by registration. Under 19 & 20 Yict. c. 47, isse. " 
§ 19, every person who had accepted shares in a company 
formed under it, and whose name was entered in the company's 
register, and no other person (except a subscriber to the 
memorandum of association in respect of the shares sub- 
scribed for by him) w 7 as a shareholder ; and § 20 in effect 
declared that a transferor of a share should be deemed a 
shareholder until the transferee was registered in his place. 
These enactments may still be important. Moreover, not- 
withstanding the repeal of the act of 1856, the regulations 
contained in table B. in the schedule to that act still apply to 
those companies which were subject to them when the Com- 
panies act, 1862, was passed (see § 206). These regulations, 
therefore, must be consulted in order to decide who is or is 
not a member of such companies ; and as regards other com- 
panies registered under the act of 1856, attention must be paid 
to their regulations, deeds of settlement, charters, &c. (a). 

(x) Banasen Iron Co. v. Barnett, 8 Butler, ib. 645, and 4 ib. 469 ; 

C. B. 406 ; Bird's case, 1 Sim. N. S. Daniell v. Royal Brit. Bank, 1 H. 

47 ; Pilbrow v. Pilbrovfs Atraos^jheric & N. 681 ; Henderson v. Royal Brit. 

Co., 5 C. B. 440. Bank, 7 E. & B. 356. 

(y) See ante, pp. 43 et seq. (a) See New Brunsivick Rail. Co. 

(z) Dossett v. Harding, 1 C. B. v. Muggeridge, 4 H. & N. 160 and 

N. S. 524 ; Powis v. Harding, ib. 580, and Bog Lead Mining Co. t. 

551 ; Thompson v. Harding, ib. 555; Montague, 8 Jur. N. S. 310, noticed 

Fry v. Russell, 3 ib. 665 ; Powis v. ante, p. 45, note (e). 



Sect. 1. 




Bk. I. Chap. 5. It has been said that unincorporated joint-stock companies 
with transferable shares are illegal at common law, first, because 
the privilege of having transferable shares can only be acquired 
by charter from the Crown, or by an act of Parliament ; and, 
secondly, because all such companies are dangerous, mis- 
chievous, and, in short, public nuisances. But this view can- 
not, the writer thinks, be supported. The question has now 
only an historical interest, and the following note on the 
subject is reprinted for the convenience of those who may 
desire information on the subject. 

Note on the Babble act. 

In order to investigate this subject properly, it is necessary to advert to 
the celebrated "Bubble act" of 1719, and the decisions upon it, for 
although that act is repealed, the discussions to which it gave rise are 
constantly referred to when the illegality at common law of joint-stock 
companies is alleged or denied. The Bubble act (a) was levelled more 
particularly at — 

1. The acting or presuming to act as a corporate body. 

2. The raising or pretending to raise transferable stock. 

(a) 6 Geo. 1, c. 18, § 18. In the Str. 472, but that case throws no 

first two editions this act was printed light on any question of present 

at length, but it is omitted now for importance, as it merely relates to 

the sake of gaining space. The act the punishment to be inflicted on a 

was repealed by 6 Geo. 4, c. 91. The person found guilty of an infringe- 

earliest reported decision on the ment of the act. See as to the his- 

Bubble act is B. v. Uawood or Cay- tory of this act, Collyer on Partner- 

u-ood, 2 Ld. Raymond, 1361, and 1 ship, p. 722, ed. 2. 


3. The using of charters for purposes not warranted by them. Bk. I. Chap. 5. 

4. The formation <>f dangerous ami mischievous companies, tending to _ 

the grievance of the suhjects of this realm. 

1. With respect to acting or presuming to act as a body corporate, it was Assuming to act 
held in It. v. Webb (b) that having a committee, general meetings, and ** a corporation, 
power to make bye-laws, was not unequivocally assuming to act as a body 

corporate ; but in the later case of Josephs v. Pebrer (c) the Court was of a 
different opinion. To create transferable shares in a common stock has also 
been said to amount t<> assuming to act as a body corporate, although only 
such bodies corporate as are specially empowered so to do can lawfully 
possess stock, the shares in which are transferable (d). 

2. With respect to transferable stock it was held that any company not Transferable 
incorporated and specially empowered to possess such stock was illegal, if it s ' Kires - 
professed to have its stock divisible into shares transferable from one person 

to another without restriction (e). But it was held that, if the shares were 
not thus transferable, their transfer being restricted to such person as should 
be approved by a committee, and as should enter into some special agree- 
ment (/), or to persons already members of the company (g), the company 
was not necessarily illegal. A scheme for establishing a tontine the shares 
in which were to be transferable after a certain time, was held not to be 
illegal, the scheme having failed before the time arrived (h). And where a 
railway company, the shares in which were to be transferable, was projected; 
and the projectors issued scrip, but resolved that nothing further should be 
done without the authority of Parliament, it was held that the project was 
not illegal (i). 

3. To use charters for purposes not authorised b} r them was clearly illegal, E sing charters 
not only by the act, but at common law. This ground of illegality does not, im P'°P r '* 
however, appear to have been made the subject of any decision on the act 

now in question. 

4. Lastly, with respect to the general ground of illegality, for being mis- Tendency to 
chievous, and tending to the grievance of the subjects of this realm. In mischief - 

22. v. Dodd(Jc) it was held that a company with transferable shares based R ex •>« Do<M. 
upon a prospectus which declared that no person could be accountable 
beyond the amount of the shares for which he should subscribe, was illegal, 

(b) 14 East, 406. Bing. 248. 

(c) 3 B. & C. 639. Adopting a (e) Buck v. Buck, 1 Campb. 547 ; 
name which necessarily denotes a R. v. Stratton, ib. 549, note ; Josephs 
corporation is assuming to act as a v. Pebrer, 3 B. & C. 639. 
corporation, R, v. Whitmarsh, 14 Q. (/) R. v. Webb, 14 East, 406 ; 
B. 803. So is the assumption and Pratt v. Hutchinson, 15 ib. 511. 

iise of a common seal, Cooch v. Good- (g) Per Lord Eldon, in Ellison v. 

man, 2 Q. B. 580. These cases were Bignold, 2 J. & W. 510. 

not decided on the Bubble act, and (/() Nockells v. Crosby, 3 B. & C. 

do not show that an unincorporated 814. 

society which assumes to act as a (i) Kempson v. Saunders, 4 Bing 5. 

corporation is illegal. (k) 9 East, 516, and see Blundell 

(d) See Duvergier v. Fellowes, 5 v. Winsor, 8 Sim. 601. 

K 2 



Bk. I. Chap. 5. 
Sect. 1. 

Rex v. Webb. 

Josephs v. 

Opinion of Lord 

Duvergier v. 


Blundell v. 

on the ground that this was a mischievous delusion, calculated to ensnare 
an unwary public. In B. v. Well {I) it was held that a company, the 
shares in which were transferable, but not without restriction, was not 
necessarily mischievous ; and the jury having found that the company was 
in fact rather beneficial than otherwise, the company was held to be legal. 
As regards the important question, how far the mere raising transferable 
stock was, per se, an offence against the act, the Court inclined to think that 
it was not, unless the company had in fact a mischievous tendency (m). In 
Josephs v. Pelrer (n), a company, with shares transferable without restriction, 
was held to be clearly mischievous, particularly because the shares were sold 
at a very considerable premium. Abbott, C. J., thought that this tended to 
introduce gaming and rash speculation to a ruinous extent, to the grievance 
of numbers of his Majesty's subjects. 

Such are the leading decisions on this celebrated act. Juster views of 
political economy, and of the limits within which legislative enactments 
should be confined, have led to the repeal of the statute in question, which, 
though deemed highly beneficial half a century ago, probably gave rise to 
much more mischief than it prevented. But the repeal of the act still 
leaves room for the contention that companies of the nature described in 
the act are illegal at common law. This question is one of present 
importance, especially in the colonies, and requires therefore careful 

Lord Eldon, who certainly had a great aversion to companies, seems to 
have been of opinion, in Kinder v. Taylor (o), that companies with large 
capitals, arising from numerous small contributions, and with transferable 
shares, were injurious to the public, and were illegal, independently of the 
Bubble act. The same opinion was expressed by the Court of Common 
Pleas, in a case which arose after the repeal of that act ( p), and also by the 
Yice-Chancellor Shadwell, on a still later occasion (q). In none of these 
cases, however, was it necessary to decide this question. In Duvergier v. 
Fellowes (r), the company was formed for an illegal purpose, vie., the work- 
ing of a patent which could not be lawfully transferred to more than five 
persons, and this was the ground relied on by the Court of Appeal. In 
Blundell v. Winsor (s) the Vice-Chancellor thought that there was held out 
to the public a false and fraudulent representation calculated to ensnare the 
unwary, viz., a representation that any shareholder when he transferred his 

(0 14 East, 406. This is the 
leading case on the Bubble act, 
and is well worthy of attentive 

(m) See, too, NocJcells v. Crosby, 3 
B. & C. 814 ; Pratt v. Hutchinson, 
15 East, 511 ; Broivn v. Holt, 4 
Taunt. 587. 

(w) 3 B. & C. 639. 

(o) Coll. on Part. 917, ed. 2. 

( p) Duvergier v. Fellowes, 5 Bing. 
248 ; affirmed 10 B. & C S26, and 1 

CI. & Fin. 39. 

(q) Blundell v. Winsor, 8 Sim. 

(r) 5 Bing. 248, and 10 B. & C. 
826, and 1 CI. & Fin. 39. 

(s) 8 Sim. 601. This case can- 
not be supported. See Harrison v. 
Heathom, 6 Man. & Gr. 81. In 
Blundell v. Winsor there was not in 
fact any such holding out as sup- 
posed by the Vice-Chancellor. 


shares ceased to I"- liable to the debl of the company ; and he relied on ttk. I. Chap. 5. 
this as a ground of illegality. Although, then fore, in each of these cases -_ ect> • 
the Court was of opinion that the company gal, inasmuch as it 

trenched upon the prerogative of the Crown by assuming to do that which 
(■annul be lawfully done without special authority, there were additional 
circumstances, rendering it unnecessary to decide on this ground alone. Tn 
IFalburnv. Tngilby(t) Lord Brougham declined to declare an unincorporated Walburnv. 
joint-stock company, with transferable hares, illegal ; although the deed of I"odby. 
settlement stated that provision was to be made, in all engagements to be 
entered into by the directors, that no shareholder should be Liable beyond 
the amount of his share, and his lordship thought this clause was nugatory. 
In Garrard v.Hardey(u) it was held that an unincorporated joint-stock Garrard v. 
company, which had assumed the mime of " The Limerick Marble and. ar ey " 
Stone Company," and had a capital of 50,000/., divisible into 500 transfer- 
able shares, was not illegal at common law. It was in this case declared 
that the raising and transferring of stock in a company could not be held to 
be in itself an offence at common law. In Harrison v. Heathom(x), a Harrison v. 
similar conclusion was arrived at. In this case the company's deed of Heathorn. 
settlement provided, that a person ceasing to lie a shareholder should he 
entitled to a certificate declaring him discharged from all liabilities on 
account of the shares formerly held by him. This was, in fact, the same 
company as was held to he illegal by Vice-Chancellor Shad well in Blundell 
v. TFinsor, which, though not overruled on appeal, can scarcely he sup- 
ported after the decision in Harrison v. Heathorn. 

Attempts have also been made, to induce the Courts to declare scrip Scrip companies, 
companies (i.e., unincorporated companies with shares transferable by 
delivery) to be illegal at common law (//). But these attempts have 
been unsuccessful. The case of Blundell v. Winsor, always relied upon 
as an authority by those who contend that such a company is illegal, 
has never met with approbation from the bench ; nor has it ever been 

Upon the whole, therefore, it appears that there is no case deciding that Conclusion from 
a joint-stock company with transferable shares, and not incorporated by tue cases, 
charter or act of Parliament, is illegal at common law ; that opinions have 
nevertheless differed upon this question ; that the tendency of the Courts 
was formerly to declare such companies illegal ; that this tendency exists 
no longer ; and that an unincorporated company with transferable shares 
will not be held illegal at common law, unless it can be shown to be of a 
dangerous and mischievous character, tending to the grievance of her 
Majesty's subjects. The legality at common law of such companies may 
therefore be considered as finally established. 

(r) 1 M. & K. 61, and Cooper, 177; Ex parte, Aston, 27 Beav. 474, 

temp. Brougham, 270. and 4 De G. & J. 320 ; Ex parte 

(u) 5 Man. & Gr. 471. Griscwood, 4 De G. & J. 544. As to 

(.c) 6 Man. & Gr. 81. See, too, the effect of the act of 1862 on these 

Shcppard v. Oxenford, 1 K. & J. 491. companies, see infra, p. 135. 

(y) See Ex parte Barclay, 26 Beav. 


Bk. I. Chap. 5. It is nut easy to arrive at any other conclusion if the question is examined 

Sect - !• without reference to the decisions which have been noticed. For 

Observations on 1- It is not illegal for persons, however numerous, to enter into an 
the illegality of ordinary contract of partnership. 

transferable^" 11 % Ifc is not nle § al f ° r a11 th ° Se P ersons to a § ree tnat 01le ° f tliem sha11 
shares. ' retire, and that a person who is not a member of the firm, but who is 

willing to become one, shall take his place. 

3. It is not illegal for partners, however numerous, to agree once for all 
that any partner who is willing to retire shall be at liberty so to do, and to 
introduce in his place any person selected by himself. 

4. It is not illegal for an out-going partner of a firm established on this 
last principle, to retire in favour of an in-coming partner, upon any terms 
to which they both agree, provided those terms are not themselves illegal. 

5. It is not illegal for an out-going and in- coming partner to agree that 
the latter shall pay the former more or less than he himself paid when he 
entered the firm. 

6. It is not illegal for the members of a partnership to assume a name (z\ 
and to agree that the management of its affairs, both external and internal, 
shall be entrusted to a select few, and that those few shall have the power 
to make rules which the others will obey. 

If these propositions are assented to, it will, it is conceived, be found 
impossible to establish the illegality at common law of unincorporated 
joint-stock companies with transferable shares (a). 

To say that such a partnership is illegal, because it assumes to act as a 
corporation, is untrue ; for none of the above acts are characteristic of 
corporations. What distinguishes corporations from other bodies is their 
independent personality ; and no society which does not arrogate to itself 
this character can be fairly said to assume to act as a corporation. Besides 
this, it is by no means clear that it is illegal at common law to assume to 
act as a body corporate (b). 

To assert that unincorporated companies with transferable shares are mis- 
chievous and dangerous, and therefore illegal, is to assert a proposition the 
truth of which has not yet been established, and which therefore cannot be 
admitted as the basis of a judicial inference. This ground of illegality 
would probably not have been relied upon so much had it not been for the 
technical rules of pleading which required all the members of a firm, how- 
ever numerous, to be made defendants to actions and suits against the firm. 
This rule undoubtedly created difficulties in dealing with large bodies of 
persons unless they were incorporated ; but if the question is reduced to 
this, viz., whether the rule, or a company to which it is inapplicable, most 
deserves to be characterised as mischievous, the question must surely be 
answered in favour of the company and against the rule. The rule, how- 

(z) Ante, p. 133. See the qualifi- that presuming to act as a body cor- 

cation in p. 131, note (c). porate was an offence at common 

(«) See JValburnv. Ingilby, Cooper, law." As to assuming a corporate 

temp. Brougham, 270. name and using a corporate seal, see 

(b) See 6 Man. & Gr. 107, where ante, p. 131, note (c). 
Tindal, C. J., says, "I am not aware 


ever, being established as law, the judges felt bound to adhere to it, and Bk. LChap. 5. 

then finding it difficult to deal with un incorporate! companies, declared • ! 

them mischievous and illegal. The difficulty presented by the rule in 
question has been to a great extent removed by the Judicature acts and 
rules made under them. 

Assuming an unincorporated joint-stock company not to be Effect of non- 
illegal at common law, it remains to be considered whether it iegls ra lon ' 
is rendered illegal, by statute, if not registered. 

The Companies act, 1862, is extremely important in this Companies act, 
respect, for the 4th section says imperatively that no company, 
association, or partnership, shall be formed after the 2nd of 
November, 1862, except as therein mentioned. From this it 
follows that companies, associations, and partnerships required 
to register under that section, are illegal if not registered (c). 
In this respect the act of 1862 differs from the Companies acts 
of 1856 and 1857 (d), and resembles the older acts of 7 & 8 
Vict. c. 110, and c. 113 (e). 

Companies formed before the 2nd of November, 1862, and 
required by the Companies act, 1862, to register under it, are 
not illegal, although the consequences of non-registration are 
severe (see § 210). 

The question whether scrip companies formed since the act Scri .P com - 
of 1862 are illegal, has not yet been determined (/) ; but it is 
of great practical importance, and before deciding it attention 
must be paid not only to the precise language of the act, but 
also to the difference between agreements to form companies 

(c) See ace. Ex parte Day, 1 Ch. Bradshaw, 5 Ex. 882, as to banks ; 
D. 699 ; S. Wales Atlantic Steamship and as to other companies, Butt v. 
Co., 2 Ch. D. 763 ; Ex parte Har- Monteaux, 1 K. & J. 98 ; Sheppard 
grove, 10 Ch. 542 ; Harris v. Araery, v. Oxenford, ib. 491. The 7 & 8 
L. R. 1 C. P. 148 ; Jennings v. Vict. c. 110, did not apply to com- 
Hammond, 9 Q. B. D. 225 ; Slmw panies formed before the passing of 
v. Benson, 11 Q. B. D. 563; Ex the act, Ex parte Aston, 27 Beav. 474, 
parte Poppleton, 14 Q. B. D. 379 ; and 4 De G. & J. 320 ; and see 
Smith v. Anderson, 15 Ch. D. 247 ; Womersley v. Merritt, 4 Eq. 695. 
overruling Sykes v. Beadon, 11 Ch. (/) The point was discussed in 
D. 170 ; Padstow Total Loss Assoc., The Gen. Co. for the promotion of 
20 Ch. D. 137 ; In re Siddall, 29 Ch. Land Credit, 5 Ch. 363, and Princess 
D. 1, all noticed ante, p. 114-115. of Reuss v. Bos, L. R. 5 H. L. 176. 

(d) See 20 & 21 Vict. c. 14, § 3, It is tolerably plain that shares not 
and c. 49, § 5. paid up in full cannot be made 

(e) As to which see O'Connor v. transferable to bearer. 



Bk. I. Chap. 5. 
Sect. 1. 


and partnerships and companies and partnerships which are 
actually formed (//). Scrip companies are not, in the writer's 
opinion, illegal at common law (/<)• 

The only other statutes to which it may he useful to allude 
in the present connection are those relating to hankers (i). 

By 7 & 8 Vict. c. 32, s. 21 (A), all hankers are required on 
the first day of January, in eveiy je&v, to make a return to the 
stamp office of their names, residences, and occupations, or in 
the case of a company or partnership, of the name, residence, 
and occupation of eveiy member of the conipairy or partner- 
ship, and in default a penalty of 50?. is inflicted. Upon this 
act a question might arise as to the legality of a banking part- 
nership, or company, composed in part of members whose 
names are not returned. 

By two statutes, which have since been considerably modi- 
fied, it was made unlawful for banking firms of more than six 
members, to issue in London or within sixty-five miles thereof, 
notes payable on demand, or within six months after date (7). 

(g) See Partn., p. 23, et seq. 

(h) Ante, p. 133. 

(i) As to marine insurers?, see 
Partn. 97. 

(k) §§ 8 & 29 of this act, and 
parts of §§ 9 & 23 are repealed by 
37 & 38 Yict. c. 96. 
Issu3 of notes. (0 39 & 40 Geo. 3, c. 28, § 15 ; 
7 Geo. 4, c. 46. See Broughton v. 
Manchester and Salford Waterworks 
Co., 3 B. & A. 1 ; Bank of England 
v. Anderson, 3 Bing. N. C. 589; 
Bank of England v. Booth, 2 Keen, 
466 ; and on appeal, Booth v. Bank 
of England, 6 Bing. N. C. 415 ; 
and 7 CI. & Fin. 509. By a sub- 
sequent act (9 Geo. 4, c. 23) the 
right to issue lulls and notes pay- 
able on demand was extended to all 
bankers (except within London or 
three miles thereof), provided they 
obtained a licence and gave a secu- 
rity, as recpnred by the act. By 3 
& 4 Will. 4, c. 83, § 2, it was made 
lawful for banking firms of more 

than six persons to issue notes pay- 
able in London through an agent, 
or to draw bills or notes upon any 
agent in London, payable on de- 
mand, or otherwise, in London, and 
for any less amount than 501. 
Then the legislature retraced its 
stq>s, conferring by the act of 3 & 4 
Will. 4, c. 9S, certain privileges on 
the Bank of England, and enact- 
ing (§ 2) that during the continu- 
ance of those privileges no banking 
firm of more than six persons 
should issue in London, or within 
sixty-five miles thereof, bills or 
notes payable on demand, with a 
proviso, as to firms carrying on 
business beyond that limit, in 
favour of bills and notes, payable 
through an agent in London, and 
for not less than bl. Then by the 
Bank Charter act of 1844 (7 & 8 
Yict. c. 32, §§ 10 & 11), it is en- 
acted that no person, other than a 
banker,- who on the 6th of May, 1844, 



Upon these statutes, it was held, that a banking company m -. \- ' 
of more than six persons associated for the purpose of issuing 
notes payable on demand, or within six months after date, was 
not illegal unless it was proved that the company issued such 
notes within sixty-five miles of London (m). Upon a similar 
statute relating to Ireland (n), it was held, that in order to 
establish the illegality of a hanking company upon the ground 
that its houses of husiness had been, from the time of the 
formation of the company until the commencement of the 
suit, and then were, at places in Ireland within fifty miles of 
Dublin, it was necessary to prove the existence of a place of 
husiness within that limit for the whole time alleged (o). The 
statutes in question, moreover, have been held only to affect 

was lawfully issuing his own Lank- 
notes, shall issue any bank-notes in 
any part of the United Kingdom ; 
and that it shall not he lawful for 
any hanker to issue in England and 
Wales bills or notes payable to 
bearer on demand ; except that it 
shall he lawful for any hanker who 
was, on the 6th of May, 1844, carry- 
ing on the husiness of a hanker in 
England or "Wales, and was then 
lawfully issuing in England- or 
Wales his own bank-nobs under 
the authority of a licence, to con- 
tinue to issue such notes to the 
extent and under the conditions 
mentioned in the act ; and by § 26, 
it is made lawful for hanking firms, 
though of more than six memhers, 
carrying en husiness in London, or 
within sixty-five miles thereof, to 
draw, accept, or endorse hills not 
payable to hearer on demand. Such 
is the state of the law on this sub- 
ject at the present time. The joint 
effect of the above enactments 
seems to be that : (1.) The Bank of 
England can alone issue, in Lon- 
don, or within three miles of it, 
notes payable to bearer on demand. 
(2.) Beyond that limit such notes 
may he issued by hankers who were 

lawfully issuing them before May, i ssue f notes. 
1844, under a licence ; hut by no 
other hankers ; ami not, therefore, 
by any banking firm of more than 
six persons carrying on the business 
of bankers within sixty-five miles 
of London. In other words there 
an 1 three limits : (1.) London and 
three miles round, in which the 
Bank of England has an exclusive 
monopoly. (2.) The district more 
than three, hut within sixty-five 
milts of London, in which the mo- 
nopoly is divided between the Bank 
of England and banking firms of less 
than six members, lawfully issuing 
notes before May, 1844. (3.) The 
district more than sixty-five miles 
from London in which the mono- 
pi ily is divided between the Bank 
of England and banking firms of 
six or more or less members, law- 
fully issuing notes before May, 
1844. See further on this subject 
the note to the Cos. act, 1862, sched. 
3, part 2, in the Appendix ; A.-G. v. 
Birkbeck, 12 Q. B. D. 605. 

(ru) Eansford v. Copeland, 6 A. & 
E. 4S2. 

(n) 6 Geo. 4, c. 42, § 10. 

(o) Hughes v. Thorpe, 5 M. & "W. 


Bk. I. Chap. 5. partnerships formed for the purpose of carrying on the busi- 
- ness of a hanker, and not to interfere with the issue of notes 

by firms not carrying on such business. 

By an act which prior to 1857 regulated joint-stock banks 
in England (7 & 8 Vict. c. 113, § 1), it was not lawful for any 
company of more than six persons to carry on the trade or 
business of bankers in England under an}- agreement or cove- 
nant of co-partnership made or entered into on or after the 
6th of Ma} r , 1844 (p), unless by virtue of letters patent to be 
granted b} T her Majesty according to the provisions of that act. 
Any banking company therefore formed since May, 1844, and 
not under letters patent, was altogether illegal if its members 
were more than six in number (q). But the law on this head 
has been altered by 20 & 21 Vict. c. 49, and by the Companies 
act, 1862. The combined effect of those acts apparently is 
that banking companies of ten or more members formed 
between May, 1844, and November, 1862, must be registered 
unless formed under letters patent, but are not illegal by reason 
of non-registration (r), and banking companies of ten or more 
members formed since November, 1862, must be registered, 
and are illegal if not registered (s). 
Chemists. An incorporated company may carry on business as chemists 

and druggists if the persons who actually sell and dispense 
drugs are duly licensed so to do (t). The principle of the 
decision which settled this is applicable to other licensed trades 
and businesses. 

(p) See Wigan v. Fowler, 1 Stark. § 205, and sched. 3, and the note 

459 ; Perring v. Dunston, By. & M. thereto in the Appendix. 

426. (s) Companies act, 1862, § 4, and 

(q) See O'Connor v. Bradshaw, 5 ante, p. 114. 

Ex. 882. Compare this case with (t) Pharmaceutical Soc. v. London 

B. v. JVhitmarsh, 15 Q. B. 600. and Provincial Supply Assoc, 5 App. 

(r) See 20 & 21 Vict. c. 49, §§ 4, Ca. 857, and 5 Q. B. D. 310 ; re- 

5 & 12, and the Companies act, 1862, versing 4 ib. 313. 


Bk. I. Chap. 5. 

Sect. 2. 


If a company, when it is formed, will be illegal, any contract Consequences 

of illegality, 
to form it, must be illegal also. Upon this ground it was held 

in Duvergier v. Fellowes (u), that a bond for the payment of 

money upon the formation by the obligee of an illegal company 

was invalid. 

It does not, however, follow that because an agreement to Effect of ilie 

•ii i i i-i • • tmlity on the 

form a company is illegal, those who subscribe to its tormation right to recover 
cannot recover back their subscriptions. If money is paid by t -' ms su 

A. to B'. to be applied by him for some illegal purpose, it is 
competent for A. to require B. to hand back the money if he 

B. has not already parted with it (.r), and the illegal purpose 
has not been carried out (//). Although, therefore, the sub- 
scribers to an illegal company have not a right to an account 
of the dealings and transactions of that company and of the 
profits made thereby (z), the}' have a right to have their sub- 
scriptions returned ; and even though the moneys subscribed 
have been laid out in the purchase of land and other things for 
the purpose of the company, the subscribers are entitled to 
have that land and those things reconverted into money, and 
to have it applied as far as it will go in payment of the debts 
and liabilities of the concern, and then in repayment of the 
subscriptions. In such cases, no illegal contract is sought to 
be enforced ; on the contrary, the continuance of what is 
illegal is sought to be prevented. 

In Sheppard v. Oxenford (a), a company was started for Actions for 


working mines in Brazil. The members subscribed each a gheppard v. 


(u) 5 Bing. 248 ; 10 B. & C. 826 ; 7 Q. B. D. 548 ; and the cases in the 

and 1 CI. & Fin. 39. See, also, last note. 

Williams v. Jones, 5 B. & C. 108. (z) See Harvey v. Collet t, 15 Sim. 

(x) See Taylor v. Lendy, 9 East, 332. Compare the cases in the next 

49 ; Varney v. Hickman, 5 C. B. note. 

271 ; Biggie v. Higgs, L. R. 2 Ex. («) Sheppard v. Oxenford, 1 K. & 

D. 422; Hampden x. Walsh, 1 Q. J. 491. See, too, Brett v. M onteaux, 

B. D. 189 ; Taylor v. Bowers, ib. ib. 98 ; Sharp v. Taylor, 2 Ph. 801 ; 

291. Compare Great Berlin Steam- Symes v. Hughes, 9 Ecp 475 ; Taylor 

boat Co., 26 Ch. D. 616. v. Bowers, 1 Q. B. D. 291. If in 

(y) Compare Herman v. Jtnchner, these cases the companies were 

15 Q. B. D. 561 ; Wilson v. StrugncU, really illegal, they must be re- 


Bk. I. Chap. 5. certain sum and received a sort of scrip certificate specifying 

Sect. 2. ... 

the number of shares to which each was entitled. Mines, 

buildings, plant, and shares were bought, and at a meeting of 
the subscribers the defendant and another were appointed sole 
directors and trustees of the property of the association. Dis- 
putes having arisen, a bill was filed against the defendant (his 
co-trustee being dead) by one of the shareholders on behalf of 
himself and the others for an account of the monies received 
and paid by the directors, and of the debts of the association, 
and for payment of those debts out of the assets, and for 
a division of the profits among the shareholders, and for an 
injunction to prevent the defendant from selling the property, 
and for a receiver. It was contended that the company was 
illegal, and that no relief could be given ; but it was held that 
the defendant as trustee could not dispute the trust on which 
he had accepted the property ; and a demurrer to the bill was 
overruled and a receiver and manager was appointed (b). 

Sales of shares If & company is illegal, shares in it cannot be recognised, 
and contracts for the sales of such shares are themselves 
illegal. Therefore, a broker employed to buy shares in an 
illegal company cannot recover the price he may have paid for 
them from the person fur whom he bought them (c) ; nor can 
the buyer, if he has paid the broker, and the shares have been 
bought, recover back any part of the money so paid, although 
the broker may have been guilty of a fraudulent overcharge (d). 
But if the purchaser of the shares has paid the broker for 
them, the broker cannot retain the mone} T against the seller (c). 
Again, as a contract for the sale of shares in an illegal 
company is itself illegal, it follows that a purchaser of such 
shares, who may have paid for them, cannot recover back his 

garded as modifying the general infra, p. 141, note {%). 

proposition, that a court of equity (c) Josephs v. Pebrer, 3 B. & C. 

will not assist a person to get back 639. The illegality in this case was 

property which he has transferred apparently treated as obvious. 

to another for some illegal purpose. (d) Buck v. Jiucl; 1 Camp. 548. 

See Brachenbury v. Brackeribury, 2 (e) Bousfield v. Wilson, 16 M. & 

J. & W. 391 ; Groves v. Groves, 3 Y. W. 185. See, also, Nicholson v. 

& J. 163. Gooch, 5 E. & B. 999 ; Tenant v. 

(b) Compare SyJces v. Beadon, 11 Elliott, 1 Bos. & P. 3, and Partn. 

Ch. D. 170 ; and other cases noticed 107, 



money if it should ultimately turn out that the company is no 1!k - I- Ch^P- 5 - 
apany at all, but a project which has failed (/). . — — 

Again, if a company is illegal it cannot maintain any action by companies. 
in respect of any transaction tainted with illegality. For 
example, an illegal company cannot prove in liquidation pro- 
ceedings for a debt clue to it (//), nor can the trustee of an 
illegal loan society recover on promissory notes given by the 
borrowing members to secure the repayment of the money 
advanced to them by the society (Ji). 

Again, as no Court will lend its assistance towards carrying 
out an illegal transaction, a member of an illegal association 
which is regulated by a trust deed cannot maintain an action 
to have the trusts administered by the Court nor compel the 
trustees to pay damages for any breach of trust (i). 

An illegal company cannot be wound up by the Court {k), Winding up. 
except perhaps at the instance of a creditor ignorant of its 
illegality (I). But if the company is legal, the mere fact that 
it may have engaged in some illegal transaction and sustained 
loss does not exclude contribution amongst the members in 
respect of such loss (m). 

Before quitting the subject of the consequences of the ille- indictment, 
gality of a company, the risk of criminal prosecution ought to 
be mentioned. Persons engaged in an illegal business are 
liable, whether incorporated or not, to be punished crimi- 
nally (n) ; and even where the object of a company is not 

(/) Kempson v. Saunders, 4 the association in question to be 

Bing. 5. illegal was disapproved. Had it 

(g) Ex parte Bay, 1 Cli. D. 699. been illegal the decision would have 

Compare Ex parte Poppleton, 14 been correct. 

Q. B. D. 379, where a company (k) Padstow lotal Loss Assoc., 20 

after registration sued in respect of Ch. D. 137. 

matters which occurred before. (I) See infra, book iv., c. 1, § 2. 

(h) Shaiv v. Benson, 11 Q. B. D. (m) Longworth's Ex. case, 1 De G. 

563 ; Jennings v. Hammond, 9 Q. F. & J. 17, affirming S. C. Johns. 

B. D. 225. 465. See Partn. 103, et seq. and 

(i) Ottley v. Browne, 1 Ball & Bea. infra, book iii., c. 2, § 3, and book 

360 ; Ex parte Mather, 3 Yes. 373 ; iv., c. 1, § 11. 

Sykes v. Beadon, 11 Ch. D. 170. In (n) See the title Conspiracy in 

Smith v. Anderson, 15 Ch. D. 247, Russell on Crimes, and Archbold's 

this last decision so far as it declared Criminal Law. 


Bk. I. Clap. 5. illegal, directors and others will do well to Lear in mind, that 

if they wilfully violate the provisions of an act of Parliament 

they are in strict law guilty of a misdemeanor and liable to be 
indicted accordingly (o). 

(o) See Lord Campbell's observa- G. F. & J. 31. As to issuing fraudu- 
tions in Longivorth's Ex. case, 1 De lent prospectuses, &c, see ante, p. 87. 








It was formerly held that persons engaged in establishing Bk. II. Chap. 1. 

companies were partners ; but this doctrine is clearly not law 

at the present da} r (a). Associations for forming partnerships, 
not being partnerships, it follows that persons who hold them- 
selves out as members of such associations do not thereby 
hold themselves out as partners, either with each other or with 
their co-members. From this it results further that, in order 
that a person engaged with others in forming a company may 
be liable for their acts, he must have authorised them to do 
those acts as his agent, or have ratified such acts. The autho- 
rity conferred may be general or special ; but unless it is held 
— which it is not (b), — that the jrarsuit of a common object by 
persons in concert gives each an authority to act as the agent 
of the others in whatever he thinks tends to the attainment of 
that object, it must be held that no one is liable for the acts of 

(a) Partn. 23, where Holmes v. are explained. 

Higyins, 1 B. & C. 74 ; Lucas v. (b) See, in addition to the cases 

Beach, 1 Man. & Gr. 417 ; and cited below, Hernial v. Leaf, 5 C. B. 

Burnett v. Lambert, 15 M. & "W. 489, 157. 


Bk. II. Chap. l. the others except so far as he has, in some definite manner, 

' constituted them his agents or ratified what they have done. 

Subscribers not The cases of Bourne v. Freeth (c), Dickinson v. Valpy (d), 
liable for acts anc j -pox v. Clifton (e), are distinct authorities for the proposi- 

of promoters. J ' 

tion that the allottees of shares in an unformed company are 

not, as such, liable for the acts of its managers. Nor are they 

liable for the acts of each other unless authority to do the acts 

can be proved (/). 

Promoters of The doctrine that the promoters of companies are not, as 

eacKher's 0t such, each other's agents, and liable for each other's acts, 

agents. appears to have been first distinctly laid down by the Court of 

Reynell v. Lewis, Exchequer in Reynell v. Lewis and Wijld v. Hopkins (g), which 

\\ yid v. Hop- were ac ti ons brought by advertising agents and map makers 

against members of the provisional committees of two railway 

to x 

companies. In each of these cases prospectuses and advertise- 
ments had been issued by the provisional committee, and the 
name of the defendant, as a member of the committee, was 
therein announced to the public. In each case the plaintiff 
had been directly employed by the solicitor to the committee, 
and in neither case had the defendant authorised his credit to 
be pledged to any one, except so far as his being a member of 
the committee, and knowing what was going on, was to be 
regarded as conferring an authority to that effect. In both 
cases the jury found verdicts for the plaintiffs. In both, how- 
ever, the Court granted new trials, and (in a judgment well 
worthy of attentive perusal) it was distinctly laid down, that 
the members of provisional committees are not partners ; that 
they are not even prima facie each other's agents ; and that, in 
order to render any member liable for the acts of the others, it 
is incumbent upon those who assert that such liability exists, 
to prove, to the satisfaction of a jury, the existence of an 
authority emanating from the member in question to the others 
to bind him. At the same time it was as distinctly laid down 

(c) 9 B. & C. 632. H. L. C. 1G1 ; Bright v. Hutton, ib. 

(d) 10 B. & C. 128. 368. 

(e) 6Bing. 776; and 9 ib. 115. (g) Both in 15 M. & W. 517. 
(/*) Wood v. Argyll, 6 Man. & Gr. Compare Maddick v. Marshall, 16 

928 ; Hamilton v. Smith, 5 Jur. C. B..N. S. 387, and 17 ib. 829. 
N. S. 32 ; Hutton v. Thompson, 3 


that ;i general authority, conferred by a defendant on his co- uk. n. Chap. 1. 

. . 1. 1. 

committee men or any other person, and sumcient to make 

their acts his, might be properly inferred from public announce- 
ments, and that a special authority for each act was by no 
means essential to render him liable for it (//). But no such 
general authority is to be assumed from the mere announce- 
ment that several persons are acting together, and endeavouring 
to get up a company. 

The principles laid down above have been since constant! v Members of 

provisional or 

recognised and acted upon, as will be seen by reference to the managing com- 
numerous cases cited below, in many of which the defendant Iu 
was a member, not only of a provisional committee, but of a 
managing committee also (/). The appointment, by a pro- 
visional committee, of a managing committee, does not per se 
render the members of the former liable for the acts of the 
latter (A). 

It follows from the same principle that the acts, statements, Acts of one r.o 
and letters of one member of a committee formed for getting the oth 
up a company, cannot prejudice any other member, unless the 
first can be shown to be the agent of the last by some other 
circumstance than their common object ; nor is the receipt of 
deposits by one member equivalent to a receipt of them by the 
others (I). 

(h) See, accordingly, Collingwood 2 McQu. 499 ; Eennie v. Clarke, 5 

v. Berkeley, 15 C. B. N. S. 145; Ex.292; Bell v. Francis, 9 C. & P. 

Maddick v. Marshall, 16 ib. 387, 66 ; Kerridije v. Hesse, 9 C. & P. 

and 17 ib. 829; Burnett v. Lambert, 200 ; Barrett v. Blunt, 2 C. & K. 

15 M. & W. 489 ; Higgins v. Hop- 271 ; Barker v. Lyndon, ib. 651 ; 

kins, 3 Ex. 163 ; Lake v. Argyll, 6 Giles v. Cornfoot, ib. 653 ; Griffin 

Q. B. 477 ; Maitlands' case, 4 De G. v. Beverley, ib. 648; Bremner v. 

M. & G. 769. See Newton v. Bel- Chamberlayne, ib. 569. 

cher, 12 Q. B. 921, and Newton v. (k) Cooke v. Tonkin, 9 Q. B. 936; 

Liddiard, ib. 925, as to mistaken Williams v. Pigott, 2 Ex. 201 ; Daic- 

admissions of liability. See as to son v. Morrison, 5 Ra. Ca. 62. 

contribution amongst promoters, (1) See Bumside v. Dayrell, 3 Ex. 

Le.froy v. Gore, 1 Jo. & Lat. 571. 224 ; Eennie v. Wynn, 4 Ex. 691 ; 

(i) Bailey v. Macaulay, 13 Q. B. Watson v. Charlemont, 12 Q. B. 856; 

815 ; Barker v. Stead, 3 C. B. 946 ; Drouet v. Taylor, 16 C. B. 671. 

Rennie v. Wynn, 4 Ex. 691 ; Ne- Compare Rennie v. Clarke, 5 Ex. 

vim v. Henderson, 5 Ra. Ca. 684 ; 292 ; Wontner v, Shairp, 4 C. B. 

Wood v. Argyll, 6 Man. & Gr. 404 ; Maddick v. Marshall, 16 C. B. 

928 ; Patrick v. Reynolds, 1 C. B. X. S. 387, and 17 ib. 829. 
N. S. 727 ; McEwan v. Campbell, 

L.c. L 



Bk. IT. Chap. 1. 

Sect. 2. 

Liabilities of 
companies for 
acts of their 

Where liability 
is imposed by 
constitution of 

Statutory debts 

Tcrson to sue. 


With respect to companies, the general principle is that 
no member of an unincorporated company is liable to non- 
members for acts done before he became a member, unless he 
has rendered himself liable for them by some contract between 
him and them (m). As regards incorporated companies, it is 
obvious that they can do no act nor have any agent before 
the}' exist themselves : whence it follows that an incorporated 
company is not liable for the acts and engagements of its pro- 
moters, unless it is made so by its charter, act of Parliament, 
or deed of settlement, or unless it has become so by what it 
has done since its formation (»)• 

When a company is formed by act of Parliament, the sub- 
scribers are usually bound by the terms of the act obtained by 
the promoters of the company (o) ; and if that act says that 
the company is to be liable for debts and liabilities incurred 
before its formation, of course it will be so liable, and the only 
question which can arise in such a case is as to the true con- 
struction of the act, and the remedy upon it. The Companies 
Clauses Consolidation act renders companies governed bj r it 
liable for the expenses of obtaining their special act (p). 

The statutory obligation thus imposed is a legal obligation 
enforceable (before the Judicature acts) by an action of debt (q); 
and such action could be sustained, although the plaintiff was 
a member of the company (r). 

The common form of enactment which imposes the obliga- 
tion usually leaves in doubt the proper person to enforce it. 
This point, however, was settled by Wyatt v. Metropolitan 
Board of Works (s) ; it was there (in effect) decided that only 

(m) Partn. 201, et seq. 

(n) See infra, c. 2, § 3, as to this. 
As to the effect of incorporation in 
discharging sureties, see Dance v. 
Girdler, 1 N. K. 34. As to pro- 
visional contracts for the purchase 
of lamls by the promoters of rail- 
way companies, see 27 & 28 Vict 
c. 121, § 3. 

(o) See as to this, ante, p. 23, 24. 

(p) 8 & 9 Vict. c. 16, § 65 ; 27 & 
28 Vict. e. 121, § 3, et seq. 

(q) Tihon v. Warwick Gas Light 
Co., 4 B. & C. 962 ; Hitchins v. A'u 7 - 
l-enny Rail. Co., 9 C. B. 536. 

(r) Garden v. General Cemetery Co., 
5"Bing. N. C. 253. 

(s) 11 C. B.N. S. 744. 

i.lAi'.li.l I J 01 C0MPANE 3 FOB A.I [B 01 PR( 11, 

those persons can sue the company upon a clause in the usual l; • 1[ Cha P- *■ 
form who have incurred expense or bestowi 'I time and trouble 
in forming the company and in getting its acl passed, and who 
have no other paymasters. For example, solicitors or parlia- 
mentary agents who have thus acted, and who have no1 been 
employed by other people who are liable to them, can sue the 
company on such clauses (/) ; but solicitors or parliamentary 
agents who have been employed by the promoters of the com- 
pany's act, and who are entitled to be paid by them, cannot 
sue the company on such clauses (w). 

It has also been decided that a person who lias agreed with 
the promoters of a company's bill in Parliament to work for 
nothing and not to charge the company for his services, 
cannot sue the company for those services, although the com- 
pany's act contained such a clause as is here referred to (x). 

Again, notwithstanding such a clause, claims which are 
illegal on grounds of public policy cannot be enforced, e.g., a 
claim by a peer for a sum of money agreed to be paid for his 
vote (or withdrawal of opposition) in Parliament (y), or a claim 
which is inconsistent with representations made to Parliament 
and inducing it to pass the bill (z). 

Again, a company's articles of association or deed of settle- Adoption by the 
ment only affect the members inter se or the parties to the comi ' :u, - v - 
deed, and a clause adopting an agreement made by the pro- 
moters does not of itself amount to a contract on which the 
company can be sued by a person with whom the company has 
not, in fact, entered into an agreement (a) ; and the fact that 

(<) Shim's claim, 10 Ch. 177, and Staff. Rail. Co. 1 Eq. 593, noticed 

see ante, note (q) ; Re Tilleard, 3 infra, p. 153. 

De G. J. & Sm. 519. (z) Spademan v. Lattimore, 3 

(u) Kent Tramways Co., 12 Ch. Giff. 16. 

D. 312 ; Wyatt v. Metrop. Board of (a) Howard v. Patent Ivory Co., 
Works, 11 C. B. N. S. 744 ; Skegness 38 Ch. D. 15G; Empress Engineer- 
Tramway Co., W. N. 1888, 253. ing Co., 16 Ch. D. 125 ; North- 
Kensington Station Act, 20 Eq. 197, umberland Avenue Hotel Co., 33 Ch. 
is not consistent with these cases. D. 16; Rotherham Alum, dec, 

(x) Savin v. Hoijlake Rail. Co., L. Co,, 25 Ch. D. 103 ; Melhado v. 

E. 1 Ex. 9. Observe that the terms Porto, Alegre, dec, Rail. Co., L. R. 9 
of the agreement were admitted by C. P. 503, where the directors had 
the demurrer. an option. And see Boston Deep Sea 

(y) Earl of Shrewsbury v. North Fishing Co. v. Ansell, 39 Ch. D. 339. 

L 2 


Bk. II. Chap. 1. ije i s a member of the company makes no difference (b). But 

such a clause may create a trust for the plaintiff which he can 

enforce (c) ; and if the clause entitles the promoters with whom 
the agreement was made to he indemnified against the claim of 
the plaintiff he can sue them and they can bring in the com- 
pany as third parties (d). 
Company taking The circumstance that a company has had the benefit of an 
the agreement agreement entered into by its promoters is not of itself suffi- 
cient to render the company liable to be sued upon it (e). 
There may, however, be cases in which it may be inequitable 
to allow a company to hold and enjoy property discharged 
from those obligations which were contracted by the promoters 
who enabled the company to acquire it (/). 
Ordinary rule But in the absence of special circumstances, such as those 

m other cases. aDove alluded to, a company is not liable for what may have 
been done by its promoters. Thus, it was held that a com- 
pany formed under the repealed act, 7 & 8 Yict. c. 110, was not 
liable to pay for the services of agents employed by its pro- 
moters (before provisional registration) for purposes connected 
with the establishment of the company (g) ; and that agree- 
ments entered into after provisional but before complete regis- 
tration, only bound the company when they were expressly 
made binding by the act itself (/?)• 

(b) Browne v. La Trinidad, 37 Ch. R, Ir. 180, where promoters sought 
D. 1 ; Eley v. Positive Ass. Co., to make the company pay interest on 
L. E. 1 Ex. D. 20 & 88, in which money borrowed in order to make 
§ 16 of the Companies act, 1S62, is the usual Parliamentary deposit, 
considered; and see Wlieal Bulla- (/) See infra, p. 149, and c. 5. 
Consols, 38 Ch. D. 42. {(J) Hutchison v. Surrey Gas Co., 

(c) See Touche v. Metropolitan 11 C. B. 689 ; and 3 Car. & Kir. 
Rail. Co., 6 Ch. 671 ; Terrell v. 45. 

Hutton, 4 H. L. C. 1091 ; Parsons (h) Payne v. N. S. Wales Co., 

v. Spooner, 5 Ha. 102 ; WiOcins v. 10 Ex. 283 ; Gunn v. Lond. and 

Roebuck, 4 Drew. 281 ; HopJeinson's Lancashire Fire Insur. Co., 12 C. B. 

case, 7 De G. M. & G. 193 ; Gaady N. S. 694. These cases turned on 

v. Gandy, 30 Ch. D. 67, per Cot- 7 & 8 Vict. c. 110, §§ 23 & 25, as to 

ton, L.J. which, see also, Taylor v. Crouiand 

(d) R, S. C. order 16, r. 48. See Gas Co., 10 Ex. 288, note ; Terrell's 
the last three notes as to the rights case, 2 Sim. X. S. 126 ; Lloyd's case, 
of the plaintiff against the company. 1 ib. 248. Terrell's case was re- 

(e) See the cases in note («), and versed on appeal, but the principle 
L.misv. West Clare Rail. Co., 15 L. in which it was decided below is 


In cases of this description the promoters themselves are Rk - n - Chap. 1. 

■ 2, 

liable on the contracts entered into by Hi (i), but not 

the company. Moreover, as will be n en hereafter, a company are not bound 
cannot ratify a contract made by its promoter^ befon Its own to jf 

existence (A - ). At the same time, an agreement 1>\ a company 
to do what its promoters have undertaken it shall do, may 
obviously be entered into, and such an agreement, if entered 
into, and if not ultra vires, will be binding on the company. 
This appears to have been the true ratio decidendi in Browning Browning v. 
v. Great Central Mining Company (I), in which a company » ^-Corn- 
registered under the Companies act of 185G was held liable to lany - 
pay the wages of a person appointed by the promoters of the 
company to be the manager of the company's works. The 
company when formed retained the manager in its service, and 
there were other circumstances warranting the inference that 
the company had appointed him its manager, although there 
was no evidence of any formal appointment, as required by the 
articles of association. The jury having found a verdict for 
the manager, the Court declined to disturb it. The salary 
sued for appears to have been calculated from a pi nod anterior 
to the registration of the company, but upon this p tint there 
is some obscurity. 

The difficulty of holding companies bound by the acts of Liability in 
their promoters has been felt as much in equity as at law (m) ; ' 
but where a company has acquired properly or exercised rights 
under an agreement entered into with its promoters, there is a 
strong tendency to treat such agreement as binding on the 

not impeachable. See Terrell v. Ebury, ib. 255 ; Spiller v. Paris 

Mutton, 4 H. L. C. 1091. Skating Rink Co., 7 Ch. D. 368, 

(i) Kelner v. Baxter, L. R. 2 C. P. is overruled by later decisions re- 

174 ; Scott v. Lord Ebury, ib. 255 ; ferred to in note (a). 
Lake v. Argyll, 6 Q. B. 477 ; Barton (l) 5 H. & X. 856. See, also, 

v. Hutchinson, 2 Car. & K. 712; Pilbrov: v. PUbrovo's Atmospheric 

Cullen v. O'Meara, Ir. Rep. 5 Com. Bail Co., 5 C. B. 440 ; and Boston 

L. 640. Deep Sea Fishing Co. v. Ansell, 39 

(A) See the cases in note (a),supra, Ch. D. 339, where there was a con- 

and Wilson v. Tumman, 6 Man. & tract by the company with the 

Gr. 236 ; Gunn v. London and plaintiff. 

Lancashire Fire Insur. Co., 12 C. (m) See the cases in the next two 

B. N. S. 694 ; Kelner v. Baxter, notes ; and as to contracts under 

L. B. 2 C. P. 174 ; Scott v. Lord seal, Pickering's claim, 6 Ch. 525, 



Bk. II. Chap. 1. company, provided the agreement is one by which the company 

Edwards v. 
Grand Junction 
Railway Com- 

Lord Cotten- 
hani's reasoning. 

would have been bound if the agreement had been entered 
into on its behalf after its formation (/*)• The leading case 
on this subject is Edwards v. The Grand Junction Railway 
Co. (o), in which an agreement between the trustees of a turn- 
pike road and the promoters of a railway company was entered 
into, to the effect that the trustees should withdraw their oppo- 
sition to the company's bill, and that the company should, if 
its bill passed, carry the turnpike road over a bridge of certain 
dimensions. The trustees withdrew their opposition, the bill 
passed, and the company refused to perform the agreement. 
An injunction to restrain the company from violating the 
agreement was granted both by Vice-Chancellor Shadwell and 
by Lord Cottenham, on appeal. Lord Cottenham, in the 
course of his judgment, said : — 

" It cannot be denied that tlie act of Moss (the projector who signed the 
agreement) was the act of the projectors of the railway ; it is therefore the 
agreement of the parties who were seeking an act of incorporation, that, 
when incorporated, certain things should be done by them. But the ques- 
tion is, not whether there be any binding contract at law, but, whether this Court 
will permit the company to use their powers under the act, in direct opposition 
to the arrangement made with the trustees prior to the act upon the faith of whirl t 
they were permitted to obtain such powers. If the company and the projectors 
cannot be identified, still it is clear that the company have succeeded to, and 
are now in possession of, all that the projectors had before ; they are entitled 
to all their rights, and subject to all their liabilities. If any one had indi- 
vidually projected such a scheme, and in prosecution of it had entered 
into arrangements, and then had sold and assigned all his interest in it to 
another, there would be no legal obligation between those who had dealt 
with the original projector and such purchaser ; but iu this Court it would 
be otherwise. So here, as the company stand in the place of the projectors 
they cannot repudiate arrangements into which such projectors had entered ; 
they cannot exercise the powers given by Parliament to such projectors in their 
corporate capacity, and at the same time refuse to comply with those terms up>on 
the faith of ivhich all opposition to their obtaining such powers was withheld. 

(n) This condition is essential. 
See Shrewsbury v. North Staffordshire 
Rail. Co., 1 Ecp 593, noticed infra, 
p. 153. 

(o) 1 M. & Cr. 650, affirming 
S. C. 7 Sim. 337. See, also, Petre 
v. The Eastern Counties Rail. Co., 
1 Ea. Ca. 462, and Stanley v. The 

Chester and Birkenhead Rail. Co , 
ib. 58, and 9 Sim. 264, affirmed 3 
M. & Cr. 773. Compare Aldred v. 
North Midland Rail. Co., 1 Ea. Ca. 
404, where the terms of the agree- 
ment were held insufficient to pre- 
clude the company from doing what 
was complained of. 


The case of The I ! London Waterworks v. Bailey was cited to prove that, Bk. ir. Chap, i 

save in certain excepted cases, the agent of a corporation must, in ord< Sect. 2 - 

bind the corporation, be authori ed by a power of attorney ; but it does not 

therefore follow thai corporations are not to be affected by equities, whether 

created by contract or otherwise, affecting those to v. tion they 

succeed, and affecting rights and property over which they claim to exe: 

control. Whit right bave the company to meddle with tlie road at all 1 

Thepowers under tlu act givt them right; but before that right < ' rred, 

it had been agreed that the right should only be used in a parti ular ma 

Gan the company exercise therighi \h agreement ? 

clearly of opinion that they cannot." 

The passages in italics contain, as Lord Cottenham himself Theory of this 
explained in a subsequent case (p), the true principle on which 
Edwards v. Grand Junction Railway Co. was decided, and 
maybe supported. In fact, the right of the plaintiff in lit 
cases is not based upon the notion that there is any contract 
between him and the company, but upon the principle that as 
the company obtained the power to interfere with him upon 
certain terms, it ought not to be allowed to exercise its powers 
to his prejudice in violation of those terms. 

The propriety of this decision has, however, been questioned Doubts as to 
and denied more than once in the House of Lords on the ise " 

ground that persons who take shares on the faith of a com- 
pany's act of Parliament cannot be justly subjected to any 
liabilities not disclosed therein or contracted by the company 
after its formation (q). At the same time, the decision itself 
lias not been overruled ; and although Lord Cottenham* s 
reasoning would apply to all contracts, whether ultra vires or 
intra vires, and is open to objection on that account, yet as 
regards contracts of the latter class, the decision in Edwards 
v. The Grand Junction Railway Co. may, it is conceived, still 
be regarded as unimpeached (/•)• This view is supported by 

(■p) Greenhalgh v. Manchester and (554; Shrewsbury v. North Stafford- 
Birmingham Rail. Co., 3 M. & Cr. shire Mail. Co., 1 Eq. 593, infra, p. 
790, 791. 153. 

((/) See Preston v. Liverpool and (r) See Bedford Bail. Co. v. Stanley, 

Manchester Bail. Co., 5 H. L. C. 2 J. & H. 746, where it was con- 

605 ; Caledonian and Dumbarton- sidered that the company was Lound 

shire Bail. Co. v. The Magistrates by the agreement sued upon. See, 

of Helensburgh, 2 Macqueen, 391 ; also, Lindsey v. The Gnat Northern 

Leominster Canal Co. v. Shrewsbury Bail Co., 10 Ha. 679. 
and Hereford Bail. Co., 3 K. & J. 


Bk. II. Chap. 1. the judgment of the Lords Justices in Williams v. The St. 
- George's Harbour Co. (s). There the promoters of a railway 
Gem^Harbour company had entered into an agreement with an owner of land 
Comp.iny. through which the proposed railway was to pass, for the pur- 

chase of his land on certain terms. The landowner, who up 
to that time had opposed the scheme, agreed to withdraw, and 
he accordingly did withdraw his opposition. The company 
obtained its act, took the land in question, hut declined to 
abide by the terms of the contract of sale ; it had, however, so 
far recognised that contract, that it had allowed judgment in 
an action for its breach to be entered up against itself. This 
recognition of the contract was held sufficient to render it 
binding on the company, whatever might have been the case 
had there been no such recognition. 
Cases to which It follows from the principle on which Edwards v. The Grand 
GranT Junction Junction Railway Co. was decided, that if the promoters of a 
Railway Com- com p anv enter into an agreement with a person, and the com- 
apply. pany, after its formation, does not exercise its powers to his 

prejudice, he can no more enforce the agreement against the 
company on equitable than on legal grounds. This was all 
Preston v. Liver- that was really decided by the House of Lords in Preston v. 
way 'Company, Liverpool, Manchester, etc., Railway Co. (t). There the com- 
pany did not take the plaintiff's land, and was therefore held 
not bound to pay for it, although the promoters had agreed to 
pay him a large sum for his land if he withdrew his oppo- 
sition to their bill, which he did. The plaintiff had nothing 
but the agreement to rely upon, and even according to 
Edwards v. The Grand Junction Railway Co., this alone is 
not sufficient (u). 
Agreements' Asain, if the contract of the promoters is one which would 

ultra vires. be ultra vires if entered into by the company after its forma- 
tion, such contract, even if attempted to be ratified by the 
company when formed, cannot bind the company. For ex- 
ample, agreements by the promoters of a company that the 

(s) 2 De G. & J. 547, varying the (n) A similar observation applies 

S. C. 24 Beav. 339. to Caledonian, dr., Bail. Co., v. 

(t) 5 H. L. C. 605, affirming 17 Magistrates of Helensburgh, 2 Mac- 

Beav. 114. See the same case on queen,. 391. 
demurrer, 1 Sim. N. S. 586. 

] i w.m [TT 0] I 0MPANIES I OB l< I S OF PR< I 


company, when formed, shall apply its funds to purposes for 1 *- " Chap. l. 

: 2. 

which they are no! subscribed, clearly do nol bind the company. 
Nor can the principle of Edwards v. 'J'ltr Grand Junction Rail- 
way Co. be applied to agreements of this description. In The Shrewsbury v. 

' ... North Stafford- 

!■'. irl of Shrewsbury v. North Staffordshire Railway Co.(x), an shire Baiiway 

ngreemenl was entered into first by tin- promoters of a railway '""i M "^ 
company, and afterwards by the company itself, to pay a peer 
20,00(M. for his countenance and support in obtaining the 
company's act, and also t<> compensate him for such land as 
the company should take or injuriously affect. It was held 
that this agreement was ultra vires and could not he enforced 
against the company, although under its statutory powers it 
took land belonging to that peer (.«/). 

(.-■) 1 E<{. 593, where all the cases 
were most carefully examined. 

(y) This is by no means the only 
authority for saying that agree- 
ments hy the promoters of a com- 
pany to the effect that the com- 
pany shall pay a large sum of 
money in consideration of the with- 
drawal of opposition to its hill in 
Parliament are altogether ultra vires. 
See Preston v. Liverpool, M"u- 
cliester, dec, Rail. Co. 5 H. L. C. 
('. >:>. The agreements in Petre v. 
Eastern Counties Rail. Co., 1 Pa. 
Ca. 642, and Stank)/ v. Chester and 
Birkenhead Rail. Co., ib. 58, and 
L» Sim. 2G4, and 3 M. & Cr. 773, 

were (if such an extravagant nature A-reori^nts for 
that they might well 1- held ultra withdrawal of 

T ,, n . c Al opposition to hill 

wres. In the first of these cases ;,, i> ar ] iaIncnt . 

120,000/., and in the latter 20,000/., 

were agreed to be paid for tin- with 

drawal of opposition to a bill, and 

fi r i ompensation for the land which 

might lie taken and injuriously 

affected. It does not, however, 

follow that such i are 

in any other respects illegal ; and 

it seems that they are not, if the 

person withdrawing his opposition 

is personally interested in opposing 

the bill. See Simpson v. Lord 

Howden, 9 CI. & Fin. 61 ; 10 A. 

& E. 793 & 807 ; 3 M. & Cr. 97. 





Agents of com 
panies which 
are formed. 

r.k. II. Chap. 2. The circumstance that a joint-stock company consists of a 
large and fluctuating body of members, is itself sufficient to 
prevent the application to companies of the ordinary partner- 
ship rule, that each member of a firm is its agent, for the 
purpose of carrying on its business. All persons dealing with 
companies are supposed to know this, and to know that the 
management of their affairs is entrusted to a few individuals 
who, and who alone, have power to act for them (a). 

B urnes v. Pennell (b), in the House of Lords, is a good illus- 
tration of the doctrine that a company is not, like an ordinary 
partnership, responsible for the acts of its members. In that 
case a shareholder in a company, who was also its solicitor 
and law agent, induced a person, by false representations as to 
the flourishing state of the company, to buy shares in it. The 
purchaser being afterwards sued for calls, relied upon the fraud 
as a defence, and he also sought to have the transfer of the 
shares to him cancelled. But it was held, that it was no part 
of the business of the company's solicitor to make any repre- 
sentations on its behalf as to its condition ; and that, although 
he was himself a shareholder, his statements were not the 
statements of the company, he not being, in his character 
of shareholder, an agent of the company for any purpose 

Company not 
bound by the 
acts of its 

Barnes v. 


(a) See Ridley v. The Plymouth 
Grinding and Baking Co., and 
Kingsbridge Flour Mill v. Same, 2 
Ex. 711 ; Smith v. Hull Glass Co., 
11 C. B. 897 ; Ernest v. Nicholls, 
6 H. L. C. 418, per Lord Wens- 

leydale ; Burnes v. Pennell, 2 H. L. 
C. 497. 

(b) 2 H. L. C. 497. See, also, 
Barnetf, Hoares <£• Co. v. The South 
London Tramways Co., 18 Q. B. D. 


Whether the company is incorporated or not, whether it is a I;k - Ir - Cha P- - 

. , Sect. 1. 

chartered company, a registered company, a company merely 
empowered to sue and be sued by a public officer, or a com- 
pany of some other description, is of no consequence whatever 
as regards the question here alluded to ; the same reason 
applies to them all (c). 


1. Directors. 

The directors then of a company, and such other persons, if Directors the 
any, as may be entrusted with the management of its affairs, company. 
are its only agents; and b} r the acts of its directors a company 
is bound, provided those acts are within the limits of their real 
or apparent authority ; and provided the person dealing with 
them has had no notice of the irregularity (if any) of their pro- 
ceedings (d). Moreover the power of directors to bind the 
company is not affected by any irregularity in their own 
appointment if the person dealing with them acted lond fide 
and without notice of such irregularity (c) ; although such 
irregularity may prevent the company from enforcing what 
they have purported to do as agents of the company (/). 

But it by no means follows that each director is the agent of Acts done by 
the company. Speaking generally, it is clear that if a person prop er number 
appoints six others to be his agents jointly, he is not bound by of directors - 
the acts of any five, four, three, two, or one of them. There- 
fore, if the affairs of a company are entrusted to the manage- 
ment of not less than a fixed number of directors, it is prima 
facie not bound by the acts of a fewer number. It has been 
held, for example, that two out of several directors had no 

(c) See Lord Campbell's judg- (e) County Life Ass. Co., 5 C'li. 

inent in Barnes v. Pennell, 2 H. L. 288. 

C. 520, et seq., and Bramah v. (/) Garden Gully Co. v. McLister, 

Boh lis, 3 Bing. N. C. 963. 1 App. Ca. 39 ; and cases quoted, 

{(l) See infra, as to this. notes (y) and (z) below. 


Bk. II. Chap. 2. power to waive a forfeiture (g), or to allot shares (h) ; that four 
- out of five had no power to compromise a large debt due to the 
company and to indemnify the debtor against certain bills of 
exchange (i) ; that six out of eight had no power to bind 
the company to pay for services rendered pursuant to their 
order (k) ; that four out of five had no power to bind the com- 
pany by an agreement for a lease (I) ; that the representations 
of one director could not be regarded as those of the com- 
pany (m) ; that notice to one director did not affect the com- 
pany (n) ; that instructions to sell land given to an auctioneer 
by one director and by the solicitor of a company, could not, 
without further evidence, be considered as having been given 
by the company (o) ; that one liquidator out of four could not 
bind the company by a bill (p). 

Majority of But it must not be supposed that the majority of a duly 

convened and duly constituted board of directors cannot act for 
the whole board and bind the company. Business could not 
be carried on if such a rule were to prevail. The decisions 
referred to above do not apply to such a case. 

Delegation of Directors being themselves agents, are 'prima facie unable to 

on y. delegate their authority to one or more of their own num- 

ber (q) ; but in many companies, and in all which are governed 
by Table A. in the schedule to the Companies act, 1862, the 
directors are authorised to delegate their powers to a few, 
and even to one only (r), of themselves, and such a delegation 
may be presumed if one or two directors act for the company in 
a matter incidental to its legitimate business (s). 

(g) Card v. Can; 1 C. B. N. S. D. 593. 
197. (n) Ex parte Credit Fonder and 

(h) Howard's case, 1 Cli. 561 ; com- Mdbilier of England, 7 Ch. 161. 
pare Ex parte Smith, 39 Ch. D. 546. (o) Moody v. Lond. and Brighton 

(i) Kirk v. Bell, 16 Q. B. 290. Bail. Co., 1 B. & Sm. 290. 

(k) Brown v. Andreivs, 13 Jur. (p) Ex parte Birmingham Banking 

938. Co., 3Ch. 651. 

(I) Ridley v. Plymouth Grinding (q) -Cartmell's case, 9 Ch. 691 ; 

Co., 2 Ex. 711. Howard's case, 1 Ch. 561 ; Ex parte 

(m) Holt's case, 22 Beav. 48 ; Birmingham Banking Co., 3 Ch. 651 ; 

Nicol's case, 3 Be G. & J. 387. Cook v. Ward, 2 C. P. B. 255. 
But see as to reports made by the (r) Taurine Co., 25 Ch. B. 118. 

chairman to a meeting of share- (s) Totterdell v. Fareham Brick 

holders, Devala Mining Co., 22 Ch. Co., L. R. ] C. P. 674 ; Lyster's 


Where the power to act for a company is vested in a given Bk - IX - Cba P- 2 - 
number of directors, and that number does not exist, and 

, . .... , . . ,ti Wliere the pro- 

there is no provision in the company s regulations enabling the per number of 

directors to act, notwithstanding a vacancy in their board (t), the f^ 6 ^-™ d ° C3 
directors who do exist cannot act for the compan}' (a). At the 
same time, if a company does in fact carry on business by 
certain persons who are allowed by the shareholders to act as if 
they were the duly constituted directors of the company, the com- 
pany will be bound by the acts of such persons in all ordinary 
matters of business, in favour of all persons bond fide dealing 
with them, without notice of their insufficiency in number or 
defective appointment (jc). But as to matters out of the 
ordinary course of business the company will not be bound. 
In Kirk v. Bell (y), where a company's deed of settlement Kirk v - Bell, 
contained a clause to the effect that there should not be less 
than five directors, and that three should be a quorum for the 
transaction of ordinary business, and where there were in fact 
only four directors, it was held that a deed executed by these 
four on behalf of the company did not bind it, the deed being 
of an unusual description, and not a matter of ordinary 
business. In like manner, in In re Alma Spinning Company, 
Bottomley's case (z), where the articles of association provided Bottomley's case, 
that the business of the company should be conducted by not 
less than five nor more than seven directors, it was held that 
these words were imperative, and not merely directory, and 
consequently a call made by the directors, when their number 
had been reduced to four, and a resolution passed by them 
forfeiting a member's shares for non-compliance with the call 
were invalid. 

Closely connected with the present subject is the question 

case, 4 Eq. 233 ; Ex parte The Con- (x) See Mahony v. East Holy- 
trad Corporation, 3 Ch. 105 & 116. ford Mining Co., L. R. 7 H. L. 

(t) Scottish Petroleum Co., 23 Ch. 869 ; Thames Haven Dock Co. v. 

D. 413 ; and see York Tramways Co. Rose, 4 Man. & Gr. 552, a case re- 

v. Willows, 8 Q. B. D. 685. rating to calls where the court was 

(a) As to giving notices to hold asked to set aside a judgment, 

meetings of shareholders, Harhen v. (y) 16 Q. B. 290. 

Phillips, 23 Ch. D. 14 ; of directors, (z) 16 Ch. D. 681; see, also, 

Ex parte Smith, 39 Ch. D. 546. Howbeach Coal Co. v. Teague, 5 H. 

Compare Brovme v. La Trinidad, 37 & N. 151; London and Southern 

Ch. 1). 1. Counties, <£r., Land Co., 31 Ch.U. 223. 



Bk. II. Chap. ! 

Sect. 1. 

Acts done by 
directors but 
not by a Board. 

Quorum must 
be present. 

and termination 
of directors' 
power to bind 
the company. 

■ whether an act which ought to he done by a Board of directors 
is valid when done by the requisite number but not at a board 
meeting. There certainly is authority for answering this ques- 
tion in the negative (a) ; and as between the company and any 
person having notice of the irregularity, that answer is probably 
correct. But as between the company and persons having no 
notice of the irregularity, the preponderance of authority is in 
favour of holding the company bound (6). 

Moreover, in order that a majority of persons present at a 
meeting may exercise the powers of a meeting, the meeting 
itself must not be too small (c), nor summoned at too short 
notice (cc). 

Prima facie, the power of the directors of a company to bind 
it commences at the date of its formation or of their appoint- 
ment ; but the commencement of that power may be postponed 
to a later period ; and if it is, their previous acts will not bind 
the company to a person dealing with them with notice express 
or implied of their want of authority (d). Again in conformity 
with the general principles of agency, the directors of a joint- 
stock company continue to have power to bind it, not only as 
long as their appointment lasts, but also as long as its termi- 
nation is unknown to those with whom they have been accus- 
tomed to deal. But this proposition must be taken in con- 
nection with the rule that persons dealing with companies 
are deemed to have notice of the contents of companies' acts 
of Parliament, charters, and registered deeds of settlement ; 
and consequently, if it is sought to make a company liable 
for the acts done by its directors after their retirement from 

(a) Bosanquet v. Shortridge, 4 Ex. 
699 ; D'Arcy v. Tamar, dec, Rail. Co., 
L. E, 2 Ex. 158, and Ex parte Smith, 
39 Ch. D. 546. 

(b) See Mahony v. East Holy- 
ford Mining Co., L. E. 7 H. L. 
869 ; Collie's claim, 12 Eq. 246 ; 
County Life Ass. Co., 5 Ch. 288. 
In Collie's claim it was said, but 
surely not correctly, that D'Arcy v. 
Tamar, dec, Rail. Co., turned on a 
technical rule of pleading. See, 
further, the cases aB to irreg 

cited infra. 

(c) London and Southern Coun- 
ties Land Co., 31 Ch. D. 223 ; How- 
beach Coal Go. v. Teague, 5 H. & N. 
151 ; Ex j)arte Morrison,De Gex, 539 ; 
and compare York Tramways Co. v. 
Willows, 8 Q. B. D. 685. 

{cc) Expte Smith, 39 Ch. D. 546 ; 
Browne v. La Trinidad, 37 Ch. D. 1. 
| (d) See Peirce v. Jersey Water- 
works Co., L. E. 5 Ex. 209. Com- 
pare Touche v. Metropolitan Rail., 
d-c, Co., 6 Ch. 671. 


office, it must be ascertained whether, upon the principle Bk. n. Chap. 2. 

n Sect. 1. 

alluded to, there was or was not notice of the cessation of — 
their authority to act for the company (e). 

The extent to which directors are agents of each other and 
liable for each others acts will be noticed hereafter (/). 

2. Agents who are not directors. 

The directors of a company are not necessarily its only Agents who are 
agents. It may, and indeed generally must, be competent for m 
them to employ other persons to act for the company ; and 
where this is the case, those persons will also have power to 
bind the company within the limits of their agency but not 
further (g). In dealing with the agents of companies there is 
great danger of finding their authority altogether repudiated, 
on the ground that they have not been duly appointed. Now, 
although directors have no implied power to delegate the 
authority conferred upon themselves, yet they must necessarily 
employ persons not only to do the every-day work of the 
company, but also to transact special branches of business 
requiring peculiar knowledge. Upon principle, therefore, 
where persons are in fact employed by directors to transact 
business for a company the authority of those persons to bind 
a company within the scope of their employment cannot be 
denied by the company, unless — 1, their emplo}-ment was 
altogether beyond the power of the directors ; or unless, 2, 
the persons employed have been appointed irregularly, and 
those who dealt with them had notice of the irregularity (/*). 
Where the power to appoint an agent for a given purpose 
exists, irregularity in its exercise is immaterial to a person 
dealing with the agent bond fide and without notice of the 
irregularity in his appointment. The following cases are 
important on this point. 

In Smith v. The Hall Glass Company (i), it was held that a Smith v. Hull 
company registered under 7 & 8 Vict. c. 110, was liable to pay Glass Com P an ^ 

(e) See as to notice, infra, §2. & W. 703, and the cases cited in 

(/) Book ii., c. 6, § 1. the next few notes. 
(g) See infra, p. 161, note (>•). (i) 8 C. B. 668, and 11 ib. 897. 

(/i) See Hawken v. Bourne, 8 M. 



Bk. II. Chap. 2. 
Sect. 1. 


Giles v. Taff 
Railway Com- 

Browning v. 
Great Central 
Mining Com- 

for goods ordered by persons in its employ, and that it was not 
necessary for the plaintiff to prove that those persons were 
authorised by the directors to order the goods in question. 
Maule, J., went further than this, and his judgment is an 
authority for the broad proposition that a company is bound 
by the acts of persons who take upon themselves, with the 
knowledge of the directors, to act for the company, provided 
such persons act within the limits of their apparent authority ; 
and that strangers dealing bond fide with such persons, have 
a right to assume that they have been duly appointed (/«;). 

This view is in accordance with later authorities. Thus, a 
company has been held bound by a verbal contract with the 
chairman of directors, although a sealed contract countersigned 
b} r three directors was required by the company's deed of 
settlement (Z) ; so by orders for repairs given by a secretary 
instead of by the directors (m) ; so by an agreement for the 
sale of land made by a company's manager who was allowed 
by the directors to make such contracts (n) ; so by cheques 
drawn by de facto but improperly appointed directors (o). Again, 
in Giles v. The Taff Railway Company (p), it was held that 
a railway company was liable for a tort committed by one of 
its servants in the course of his employment, although there 
was no proof, except that afforded by the fact of employment, 
that he was the servant of the company. 

Even as between the agent himself and the company, if the 
directors appoint him and allow him to act as agent of the 
company, and he does so act bond fide and without notice of 
any irregularity in his appointment, the company will be liable 
to him for his salary although he may not have been appointed 

(k) See 11 C. B. 927. The other 
judges relied more on the fact that 
the directors had sanctioned and 
adopted the contracts. But as the 
knowledge on the part of the 
directors of what was done was 
assumed rather than proved, there 
was little if any difference in the 
views of the different members of 
the Court. 

(/) Renter v. Electric Telegraph 
Co., 6 E. & B. 341. 

(w) Allard v. Bourne, 15 C. B. N. 
S. 468. 

(«) Wilson v. West Hartlepool 
Rail. Co., 34 Beav. 187, affd. 2 De 
G. J. & Sm. 475. Compare Moody 
v. Loudon and Brighton Rail. Co., 1 
Best & Sm. 290. 

(o) Mahony v. East Hohjford 
Mining Co., L. R. 7 H. L. 869. 

(p) 2 E. & B. 822 ; Goff v. G. N. 
Rail. Co., 3 E. & E. 672. See, 
further, infra, c. 3, § 2. 


precisely in the manner prescribed by the regulations of the l;; " c ' ja P- -• 

Sect. 2. 

company (q). 

These cases must not be confounded with others in which Lim'ts to autho- 
companies have been held not bound by acts done by their 11 
agents when acting beyond the limits set by the nature of their 
employment (/•). 

Having seen who are to be considered agents of a company, Limits of the 

. . . t • • l-i directors' 

it is necessary to examine the limits within which a company authority. 

is answerable for their acts. Agents cannot have a more 
extensive authority than their principals can legally confer 
upon them ; and this principle at once limits the authority of 
all agents of incorporated companies. The capacity of such 
companies is itself limited, and they cannot be legally bound 
by any acts of their directors or officers in which the companies 
themselves are legally incompetent to engage. But as regards 
other matters, business cannot be carried on unless the directors 
of companies may be dealt with, on the assumption that they 
have power to bind their companies by all such acts as can 
fairly be said to be necessary for the purpose of carrying on 
their legitimate businesses in the way in which such businesses 
are usually carried on by other people. Such power is con- 
sequently implied (s) in favour of all persons dealing bond fide, 

(</) Browning v. Great Central Hail. Co., 3 Ex. 268 ; Walker v. 

Mining Co., 5 H. & N. 856. In Great Western Rail. Co., L. U. 2 Ex. 

this case an appointment under the 228 ; statements made by secretary, 

seal of the company was not neces- Barnett, Hoares <£• Co. v. South Loud. 

sary. See, also, Totterdell v. Fare- Tramways Co., 18 Q. B. D. 815 ; 

ham Brick Co., L. E. 1 C. P. 674. statements by solicitors as to the 

(r) See as to Promissory notes, flourishing condition of the com- 

Ximpson's claim, 36 Ch. D. 532 ; as pany, Burnes v. Pennell, 2 H. L. C. 

to buying shares, Cartmell's case, 9 497 ; sales by a solicitor not in- 

C 'h. 691 ; as to policies of insurance structed to sell by the directors, 

issued by local agents, Linford v. Moody v. Lond. and Brighton Fail. 

Provincial Horse and Cattle Insur- Co., 1 B. & Sm. 290. 
ance Co., 34 Beav. 291 ; as to orders (s) See Smith v. Hull Glass Co., 8 

by station masters for surgical C. B. 608 ; Taunton v. Royal Insur. 

attendance, Cox v. Midland Counties Co., 2 Hem. & M. 135; A.-G. v. 
L.C. M 


Bk. IT. Chap. 2. anc ] without notice of its non-existence. Further it is esta- 

Sect. 2. 

blished that what the directors of a company have power to do, 

and do in the name of the company and on its behalf (t), binds 

the company, although they may not have acted in the manner 

Distinction be- prescribed by the regulations of the company. A distinction is 

tween acts ultra x J ° x 

vires and acts thus taken between what directors have no power to do at all, 
intra vires, but -i-iit -, ■ • t • 

irregular. and what they have power to do, provided certain conditions are 

complied with; in other words, between acts which, as regards 

the company, are altogether ultra vires and those which are 

intra vires but irregular; and whilst it is held that companies 

are not bound by acts of the former class, it is held that 

they may be bound by acts of the latter class in favour of all 

persons dealing with their directors bond fide and without 

notice of the irregularities of which they may be guilty (u). 

1. Of acts which are ultra vires. 

Acts altogether With respect to those acts which directors have no power to 
do at all, it must be borne in mind that trading and similar 
corporations which are created for certain definite purposes 
have no greater capacity than is conferred upon them by their 
constitution (x). They exist for certain purposes, more or less 
well denned in the instrument incorporating them, but the}- 
exist for no other purposes ; and a corporation created for one 
purpose cannot lawfully do anything which is foreign to the 
purpose for which alone it was created. If, therefore, it can 
be predicated of any contract entered into by or on behalf of a 
body corporate, that such contract is one into which the cor- 
poration, even with the assent of all its members, cannot 
legally enter, such contract must necessarily be invalid. This 
is not the consequence of any doctrine of the law of agency, 
but of the nature of corporations, and of the difference between 

Great Eastern Rail. (Jo., 5 App. Ca. (./•) See the judgment of Bowen, 

473. L. J., in Baroness fVenlock v. River 

(t) See Hambro' v. Hull, dr., Dee Co., 36 Ch. D. 684 n., where 

Insurance Co., 3 H. & X. 789. the difference between trading 

(it) See generally on the subject and other corporations of that kind, 

of the ensuing pages a treatise on and municipal corporations is pointed 

the doctrine "f ultra vires by Seward out. 



them and ordinary individuals (2/). This principle applies to l;L ','■ ' ^P- -• 

joint stock companies. But there is an important difference — 

between incorporated and unincorporated companies, forwhilst 

it is. competent for all the shareholders of an unincorporated 

company to depart from the agreement entered into by each 

with the others (:), it is not competent for all the shareholders 

of a company incorporated by charter or statute to do anything 

contrary thereto (a). Nor can a corporate body be estopped 

by deed or otherwise from showing that it had no power to do 

tliat which it purports to have done (b). 

The constitution of a company as settled by its charter, act Powers of di- 

p t> v 1 r ' j. m i i c ^1 rectors limited 

01 .Parliament, memorandum oi association, or deed ot settle- 1)V t j ic con ., t ;. 

ment, limits, to a certain extent, the powers of its directors ; t,lt1 "" "' llli '' 

x ' company. 

for whatever it may or may not be competent for all the share- 
holders to do, it certainly is not competent for the directors of 
a company to bind it by entering on its behalf into trans- 
actions not warranted by its constitution as settled for the 
time being (c). The directors of a company have authorit}' to 
do whatever is necessary for the transaction of the company's 
legitimate business in the way in which such business is 
usually carried on by other people (d), but they have no power 

(;/) See upon this subject, Pollock 
on Contracts, 110, et seq. ; Att.-Gen. 
v. Great Eastern Bail. Go., 5 App. 
Ca. 473, and 11 Oh. D. 449 ; L. and 
N. W. Bail. Co. v. Price, 11 Q. 
B. D. 485 ; London Financial Assoc. 
v. Kelk, 26 Ch. D. 107 ; Baroness 
Wenlock v. Biver Dee Co., 10 App. 
Ca. 354, 36 Ch. D. 675 n., ib. 674, 
and 38 Ch. D. 534 ; and the cases 
referred to infra, notes (/) and (g). 
See, as to dealings with land, 
Grand Junction Canal Co. v. Petty, 
21 Q. B. D. 273, and cases there cited. 
As to the consequences of a corpora- 
tion taking securities which it ought 
not to take, see Ayers v. S. Austra- 
lian Banking Co., L. R. 3 P. C. 548. 

(3) Partn. 408 ; Blackburn Benefit 
Soc. v. Gunliffe, Brookes & Co., 29 
Ch. D. 902. 

(a) See Ashbury Railway Carriage 
Go. v. Riche, L. R. 7 H. L. 653; 
Society of Practical Knowledge v. 
Abbott, 2 Beav. 559; Bagshaw v. 
Eastern Union Bail. Co., 7 Ha. 114, 
and 2 M. & G. 389 ; and Baroness 
Wen lock v. Biver Dee Co., ubi supra. 

(b) See Baroness Wenlock v. Biver 
Dee Co., ubi supra ; Ex parte Watson, 
21 Q. B. D. 301 ; Fairtitle v. Gilbert, 
2 T. R. 169. Compare Webb v. 
Commissioners of Heme Bay, L. R. 5 
Q. B. 642, where the company had 
power to issue debentures, although 
they did not properly exercise the 

(c) Ashbury Bailway Carriage Co. 
v. Riche, L. R. 7 H. L. 653. 

(d) Smith v. Hull Glass Co., 8 C. 
B. 668 ; Taunton v. Royal Ins. Co., 
2 Hem. & M. 135. 

M 2 



Bk. II. Chap. 2. to engage in a class of business for the transaction of which 

Sect. 2. n n 
r the company was not formed (e). 

With respect to the capacities of trading and similar cor- 

Capacity of 

Ashbury, &c. 
Co. v. Kiche. 

porate bodies to bind themselves by contracts, there is an 
apparent difference of opinion upon the question whether the 
burden of proof is upon those who assert that the power to 
enter into any particular contract exists or upon those who 
assert the contrary. 

It is agreed on all hands that a corporation cannot lawfully 
do that which its constitution does not expressly or impliedly 
warrant. The difference of opinion, if there really be any, is 
not as to that, but simply as to whether the act of incorpora- 
tion is to be regarded as conferring unlimited powers except 
where the contrary can be shown ; or whether alleged corpo- 
rate powers are not rather to be denied unless the}*- can be 
shown to have been conferred either expressly or by necessary 

The former is apparently the correct view so far as muni- 
cipal and other corporations not created for any clearly limited 
purpose are concerned (/) ; but the latter is submitted to be 
the correct view with respect to trading and similar corpora- 
tions which are created for certain definite purposes only(#). 
That such corporations cannot do that which their constitu- 
tion does not warrant admits of no doubt, and is conclusively 
established by the decision of the House of Lords in Ashbury 
Railway Carriage Co. v. lliclie (/*). In that case it was held 
that a company formed and registered under the Companies 
act, 1862, for contracting to supply materials for making 
railways and to carry on the business of general contractors, 
was not bound by a contract to make a railway, although such 

(e) The cases on this head are 
excessively" numerous, and will be 
noticed hereafter. 

(/) See the authorities cited, L. 
R. 9 Ex. 262, et seq. 

(g) The leading cases on this sub- 
ject are Baroness Wenlock v. River 
Dee Co., 10 App. Ca. 354, and 36 Ch. 
D. 674, and Ashbury Railway Carriage 
Co. v. Riche, L. R. 7 H. L. 653, and 

9 Ex. 224. See Lord Justice Bowen's 
judgment, 36 Ch. D. 684 n. ; and 
Lord Selborne's judgment, L. R. 
7 H". L. 693, both of which are in 
favour of the view in the text ; but 
the judgment of Lord Blackburn, 9 
Ex. 262, et seq.. is opposed to it. 

(h) L. R. 7 H. L. 653, S. C. L. B. 
9 Ex. 224, 249. 


contract had been entered into by directors of the company, Bk. II. Chap. 2. 

and had been afterwards approved by the shareholders (i). 

Such a contract was not authorised by the company's memo- 
randum of association and could not bind the company in its 
corporate character, even though every shareholder in it might 
have assented to it. The rule laid down in this case applies 
to all companies created b} r statute for a particular purpose, 
and is not confined to companies created by the Companies 
act, 18G2 (k). At the same time, whatever may fairly be 
regarded as incidental to or consequential upon those things, 
which the legislature has authorised, ought not, unless expressly 
prohibited, to be held by judicial construction to be ultra 
vires (/). 

Companies' articles of association and deeds of settlement ' ' 

usually prescribe certain limits to the powers of their directors. of ' 

rendering them much less extensive than they would be if 1 C0I11 F« n :'- 
limited merely by the purpose for which the companies are 
formed ; and opinions have differed upon the question whether 
the public can safely deal with the directors of companies 
without ascertaining the real limits set to their authority (;»)• 
But it is now settled that persons who deal with a company 
whose regulations are registered, and are therefore accessible to 
the public, cannot hold the company liable if the directors exceed 
their authority as disclosed by those regulations. Accordingly 
in Balfour v. Ernest (n), it was held, that an insurance company Balfour v. 

" Ernest. 

(i) Compare Sheffield Nickel Co. v. Ernest v. XichoUs, 6 H. L. C. 401 ; 

Uittriii, 2 Q. B. D. 214, where what Iloyal British Ban]; v. Turquand, 

was done was within the scope of E. & B. 327 ; Atheneeum Life Ass. 

the memorandum of association. Society v. Pooley, 1 Giff. 102, and 3 

(k) Att.-Gen. v. Great Eastern Bail. De G. & J. 294. See as to Lord 

Co., 5 App. Ca. 473, and 11 Ch. D. Wensleydale's observations in 6 H. 

440 ; Baroness JFenlock v. River L. C. 419 ; Agar v. Afhenceum Life 

Dee Co., 10 App. Ca. 354, and 36 Ins. Soc., 3 C. B. N. S. 725; 

Ch. D. 075 n. London Dock Co. v. Sinnott, 8 E. 

(/) Att.-Gen. v. Great Eastern Bail. & B. 347. 
Co., ubi supra; L. and N.-JF. Bail. (n) 5 C. B. X. S. 601. See, too, 

Co. v. Price, 11 Q. B. D. 485. Irvine v. Union Bank of Australia, 

(m) The difference of opinion on 2 App. Ca. 3G6, as to resolutions 

this subject will be seen at once by which ought to be registered ; 

comparing the judgments in Green- Peirce v. Jersey Waterworks Co., 

wood's case, 2 Sm. & G. 95 (reversed L. R. 5 Ex. 209 ; Ex parte Overend, 

on appeal, 3 De G. M. & G. 459) ; Gurney & Co., 4 Ch. 460 ; Ex parti 



Cliajileo v. 


Bk. II. Chap. 2. was no i bound bv a bill of exchange accepted by its directors 

Sect. 2. • to L . J 

— on its behalf for a debt incurred by another insurance company, 
which had been amalgamated with the first ; for the amalga- 
mation was not authorised by the deed of settlement of the 
company on whose behalf the bill had been accepted, and the 
holder of the bill was aware of the nature of the debt for which 
the bill had been given. 

Again in Chapleo v. Brunswick Building Society (o), it was 
held that persons who have dealings with a building society 
must be taken to know that such a society has no power of 
borrowing except such as is conferred upon it b}' its rules ; and 
if the directors exceed their authority in this respect, those 
who trust them and lend them money for the society, cannot 
compel the society to repay it. 

This doctrine is based upon the necessity of protecting 
shareholders against the unauthorised acts of their directors, 
and ought not to be extended to cases in which persons who 
are really ignorant of the powers of directors, seek to make 
them personally responsible for the assumption of powers they 
did not really possess. The liability of directors in respect of 
contracts entered into by them beyond their powers will be 
alluded to hereafter (_p) ; and it will then be seen that although 
such contracts do not bind the compan}' for which the directors 
may have acted, it by no means follows that they are not 
personally liable in respect of them. 

Limits of this 

Acts intra vires, 
but irreinilar. 

2. Of acts which ewe intra vires, but irregular. 

Notwithstanding, however, that a company is not bound by 
those acts of its directors, which as regards the company are 
ultra vires, and notwithstanding the doctrine that persons 
dealing with companies are affected with notice of their regis- 
tered regulations, yet, as already stated, there is no necessity 
on the part of such persons to see that tie facto directors arc 

Eagle Ins. Co., 4 K. & J. 549; 
Athenceum Life Ass. Soc. v. Pooley, 1 
Giff. 102, and 3 De G. & J. 294 ; 
Sheffield's case, Johns. 451, and 
Kearns v. Leaf, 1 Hem. & M. 681. 

(o) 6 Q. B. D. 696, at pp. 712 & 
713. See, further, as to borrowing 
powers, infra, pp. 187, ct seq. 

(p) Book ii., c. (!, § 1. 


properly appointed (q), nor to see that directors exercise the Bk. II. Chap. 2. 

powers they possess in the precise manner prescribed by the 

regulations of the company ; and it may be taken as now settled 

that persons dealing with directors bond fide, and without 

notice of an irregular or improper exercise of their powers, 

are not affected by such irregularity or impropriety. 

The leading authority on this head is The Royal British Royal British 
" J ' . Bank v. Tur- 

Bank v. Turquand (r). In that case, a company's deed, regis- quand. 

tered under 7 & 8 Vict. c. 110, empowered the directors to 
borrow on the bonds of the company such sums, as by a 
general resolution of the company might be authorised to be 
borrowed. The directors gave the bankers of the company a 
bond for 1000J-., sealed with the seal of the company, and 
signed by two directors, as a security for what might he due 
from the company to its bankers on its current account. This 
was not authorised b}' any resolution of the company, and it 
was therefore contended that the bond was invalid. There 
was no question here as to the form of the bond, or as to the 
authority of those who issued it to act for the company. The 
company was prima facie bound by the bond, and no one 
looking onl}- at the deed of settlement and the bond, could 
come to a different conclusion. The only question was, 
whether the bankers were bound to look further and to ascer- 
tain whether the issuing of the bond had been authorised by 
the resolution of a general meeting. It was held both by the 
Court of Queen's Bench and by the Court of Appeal, that 
they were not, and that the excess of authority was a matter 
which concerned only the shareholders and the directors. 
C. J. Jervis, in affirming the decision of the Court below, said, 

" We may now take for granted, that the dealings with these companies 
are not like dealings with other partnerships, and that the parties dealing 
with them are hound to read the statute and the deed of settlement ; but 
they are not hound to do more (s). And the party here on reading the deed 
of settlement, would find not a prohibition from borrowing, but a per- 

(7) County Life Ass. Co., 5 Ch. H. L. 809, where there were none. 
288, where there were some duly (?•) 5 E. & B. 248, and 6 ib. 327. 

appointed directors ; Mahony v. (s) See ace. as to bye-laws, Royal 

East Eolyford Miniwj Co., L. R. 7 Bank of India's case, 4 Ch. 252. 



Bk. II. Chap. 2. mission to do so on certain conditions. Finding that the authority might 
> - e be made complete by a resolution, lie would have a right to infer the fact of 

a resolution authorising that which on the face of the document appeared to 
be legitimately done " (t). 

Omnia praesu- 
niuntur rite 
esse acta. 

Clarke v. Im- 
perial Gas 

Hill v. Man- 
chester Water- 
works Company. 

Smith r. Hull 
Glass Company. 

Agar v. Athe- 
naeum Assurance 

This was not the first occasion on which the maxim omnia 
prasumuntur rite esse acta had been applied to such cases. In 
Clarke v. Tlie Imperial Gas Light and Coke Company (u), a 
bond given b} r the directors of a company under the seal of the 
company for the payment of an annuity to a retired servant, 
was presumed tohave been executed after due compliance with 
all conditions ; and in Hill v. The Manchester and Salford 
Waterworks Company (#)", the same principle was acted upon ; 
although that case rather turned on the inadmissibility of the 
evidence by which it was sought to show that the requisite 
formalities had not been complied with. In Smith v. The Hull 
Glass Company (y), Maule, J., whilst recognising the doctrine 
that all persons who contract with the directors of a registered 
company must be taken to be cognisant of the extent of the 
authority conferred upon them, added, " But it by no means 
follows that they are to be taken to be cognisant of all the 
proceedings of the board of directors ; " and that learned judge 
held, that the public were entitled to assume that a person 
acting as the agent of a compan} T had been duly appointed by 
the directors ; for by the company's deed of settlement, the}- 
had power to appoint persons to carry on its business. Again 
in Agar v. The Athenaum Life Assurance Society (z), the directors 
had power to borrow, but only with the consent of an extra- 
ordinary general meeting of shareholders. The} r did borrow 
by issuing debentures sealed with the seal of the company, and 
signed by two of themselves ; and it was held, that these deben- 
tures were binding on the company, although no such authority 
to borrow had been conferred by a general meeting as was con- 

(t) See as to this Irvine v. Union 
Bank of Australia, 2 App. Ca. 366, 
where the resolution, if any, would 
have been registered. See, also, 
La ttdovmerJ Inclosv.rc Co. v. Ashford, 
16 Ch. D. 411 ; Romford Canal Go., 
24 Ch. D. 85. 

(«) 4 B. & Ad. 315. 

(x) 5 B. & Ad. 866. 

(y) 11 C. B. 897. 

(;.) 3 C. B. N. S. 725. Compare 
this with Athenazum Life Ass. Hoc. v. 
Pooley, 3 De G. & J. 294, and 1 Gift". 


templated by the company's deed of settlement. In Tlie Bk. u - CIii i'- -• 

Prince of Wales Assurance Society v. The Athenceum Insurance 
Society (a), the Court of Queen's Bench held, that a policy of Wl] , 
insurance issued under the seal of an insurance society and ^."ij^q,',' ',,,',' 
signed hy three of its directors, was binding' upon the society, Society. 
although the issue of the policy had not been authorised by a 
previous resolution of directors as required by the company's 

The same principles have frequently been approved and Eaglo Co upany's 
acted upon in chancery.. In Ex parte The Eagle Company (b) 
a claim was made against the Athenasum Assurance Society in 
respect, not of a policy under its seal, but of an agreement to 
grant such a policy entered into on behalf of the society by its 
directors. The Court allowed the claim. The Vice-Chancellor 
Wood, in delivering judgment, approved of the observations 
made in The Royal British Bank v. Turquand and of the dis- 
tinction there drawn, between that which upon the face of it is 
manifestly imperfect when tested by the requirements of the 
deed of settlement of the company, and that which contains 
nothing to indicate that those requirements have not been 
complied with. 

" Tims, where the deed requires certain instruments to be made under 
the common seal of the company, every person contracting with the com- 
pany can see at once whether that requisition is complied with, and he is 
hound to do so ; hut where, as in the case I have last referred to, the con- 
ditions required hy the deed consist of certain internal arrangements of the 
company, for instance, resolutions at meetings and the like, if the party 
contracting with the directors finds the acts which they undertake to do, to 
be within the scope of their power under the deed, he has a right to assume 
that all such conditions have been complied with. In the case last sup- 
posed, he is not bound to inquire whether the resolutions have been duly 
passed or the like, otherwise he would be bound to go further back and to 
inquire whether the meetings have been duly summoned and so ascertain a 
variety of other matters into which, if it were necessary to make such 
inquiry, it would he impossible for the company to carry on the business 
for which it is formed." 

('() 3 C. B. N. S. 756, note. See, Australian, cOc, Ass. Co. v. British 

too, Prince of Wales Assurance Soc. Provident, dr., Society, 3 Giff. 521, 

v. Harding, E. B. & E. 183. varied on appeal, 4 De G. F. & J. 

(6) 4 K. & J. 549. See, t< »o, A nglo- 341. 


Bk. IL^Chap. 2. Again iii Ex parte Overend, Gurney dt Co. (c), a company 
— - was held bound by bills accepted by its chairman, although he 

Ex parte Over- , . ^ ' ° 

end, aurcey k had only been authorised to accept them on certain conditions 
which had not been complied with. The bill holder in this 
case had no notice of the conditions, but even if he had had 
such notice it would have been no part of his business to see 
that they had been complied with ; he would have been entitled 
to assume that they had id). 

Further illustrations of the same principle are afforded by the 
cases already noticed in which companies have been held bound 
by the acts of agents irregularly appointed (e). 

Peirce v. Jersey In connection with these cases it is necessary to allude to a 

i V ti t c r \v o rk s 

Company. decision apparently in direct conflict with them, viz., Peirce v. 

Jersey Waterworks Company (/). In this case a company was 
formed and registered under the Companies' act, 1862, with 
articles which provided in substance that when 3,000 shares 
had been allotted the members should be associated for the 
objects of the company and be all bound by its regulations, as 
if all the shares had been allotted. Before 3,000 shares were 
allotted the directors appointed the plaintiff to be the engineer 
of the company ; and he sued the company for his salary, and 
although he had no notice that the 3,000 shares had not been 
allotted, he was held not entitled to recover. The Court con- 
sidered that until 3,000 shares had been allotted no such com- 
pany existed as the plaintiff could contract with. But the 
company unquestionably did exist as a corporate body (g) ; and 
although the allotment of 3,000 shares may have been a con- 
dition precedent to the commencement of the directors' power 
to bind the company, the cases already alluded to go far to 
show that the plaintiff was entitled to assume that the condi- 
tion had been performed. There is, however, a difference 
between assuming that an agency has commenced and assuming 
that persons whose agency has commenced are pursuing their 
authority, and this difference is perhaps sufficient to render the 
decision in question consistent with those alluded to above (h). 

(c)4Ch. 460. (g) Ante, p. 111. 

(d) See per L. J. Giffard, ib. 474. (h) See the end of Mr. Baron 

(e) Ante, pp. 158, 160. Bramwell's judgment. 
(/) L. E. 5 Ex. 209. 


The principles established by the foregoing cases apply, not 1;1 • " '' li:i i'- -• 
only as between companies on the one hand and strangers on 


the other, but also between companies and their members; ami .,. :ili 

it has been held over and over again, as will be seen hereafter, St"^!^- 

that as between one shareholder and the others the validity of 

the acts of their directors depends in any particular case much 

more on the power of the directors to do the acts in question, 

than on the regularity or irregularity of the manner in which 

those acts may have been done (?'). 

A person who knows or is to be treated as knowing that i:,i ! 

of impropriety. 
directors or agents are acting irregularly and improperly cannot 

hold the company bound by their acts (k) ; and instruments 

signed by directors on behalf of a company, in a name which 

is not that of the company, are improper on the face of them, 

and do not bind the company (/). 

In connection with the subject of notice, it must not be for- Ti 

„ „ _ _ . seem itii a i 

gotten that transferees of bonds and other ordinary choses in perlj issued. 

action of that kind, not being negotiable instruments, are prima 
facie in no better position than their transferors (m). But a 
company may be estopped from denying as against a transferee 
of a security what it might have denied as against the trans- 
feror. For example, in Webb v. Commissioners of Heme Webb v. Com- 
Bay (n), a corporation was empowered by statute to issue j'^',' 
debentures but not to members of its governing body. Deben- 
tures however were issued to one of such members, and were 
assigned to a bund fide holder for value without notice of the 
impropriety in the issue, and it was held that the corporate 
body was bound by the debentures, and was estopped from 
denying their validity as against the plaintiff'. 

Again in the case of the Romford Canal Co. (o), some deben- Romford Canal 

, . . . „ Company. 

tureswere issued to a contractor without the sanction 01 a meet- 

(i) See in book iv. under the head (m) Athenaeum Life Ass. Soc. v. 

Contributories. rooky, 1 Giff. 102, and 3 De G. & 

(k) See Chapleo v. Brunswick J. 294 ; and other cases noticed 

Building Society, 6 Q. B. D. G96 ; infra, p. 180. 

Balfour v. Ernest, 5 C. B. N. S. 601 ; (n) L. R. 5 Q. B. 642. 

Zulueta's claim, 5 Ch. 444 ; Irvine v. (o) Careufs claim, 24 Ch. D. 85. 

Union Bank of Australia, 2 App. Ca. See, also, Ex parte The City Bank, 3 

366. Ch. 758 ; Ex parte Colborne and 

(I) Hambro' v. Hull, dr., Ins. Co.. Strawbridge, 11 Eq. 478. 
3 II. & N. 789. 


Ek. II. Chap. 2. j n g a t w hich an insufficient number of shareholders was present 
Sect. 3. ° x . 
and he knew this. A bond fide transferee for value without 

notice of the irregularity was nevertheless held entitled to pay- 
ment by the company. 
Formalities The observations made above respecting the validity of con- 

required by ... . 

law. tracts, &c, entered into by directors in contravention of a 

company's regulations, have no application to cases in which 
contracts are required by law to be in a particular form, and 
that form is not observed. The formalities which must be 
complied with in order to render contracts binding upon com- 
panies will be noticed hereafter ( jj), and it will then be seen 
that whether these formalities are required by statute or by the 
common law, contracts not in the form prescribed are altogether 
invalid, unless they can be upheld on the equitable principles 
relating to part performance. 


A statute may require an act to be done in a particular way 
and yet not render the act null and void if not done in the way 
prescribed. "Whether invalidity of what is done is a conse- 
quence of a departure from the terms of the act or not depends 
on its true interpretation, and this again depends on the word- 
ing of the statute and on the object sought to be attained by 
it. Statutes are said to be imperative when they render null 
and void what is done contrary to their provisions ; and to be 
directory when the consequence of disregarding them is not 
the nullity of what is done but something different. The 
following cases illustrate the distinction in question : — 

Examples of di- By the 4 Geo. 4, c. 76, § 16, it was enacted that the father, if living, of 

rectory statutes, an ^ p ar ty under twenty-one years of age, should have authority to give 

k^ consent to the marriage of such party, and if the father was dead, then that 

other persons mentioned in the act should have such authority ; and the act 

then went on thus : " And such consent is hereby required for the marriage 

( p) Infra, c. 4. 


of such party bo underage, unless there shall be no person authorised to Bk. n. Chap. 2. 

give such consent." A person who was under twenty-one, and whose lather ' °' 

was living, married without hi • con ent. It was held that the marriage was 

nevertheless valid ; for the legislature evidentlydid not intend to bastardise 

the issue of ma mnised without the consent required (q). Again, Pay™ 

it has been held thai a covenant by a municipal corporation to repay money Brecon. 

borrowed, is valid, although the monej i- uot borrowed for any purpo • 

which the borough fund is made applicable by the Municipal corporation 

act, and although the deed containing the covenant has nol been approved 

by the Lords of the Treasury as required by the same act (/•). So it was i,,. Feuvre v. 

held, that a rale made under the Public health act of 1848 was valid, Miller. 

although that statute requires all rates made or collected under it, to be 

published in the same manner as poor-rates, and the rate in question had 

not been published in the manner required (••>•). 

Ill each of these cases, the statute in question was said to be 
directory only ; and to each of them the maxim Fieri non 
debuit sed factum valet, was held applicable. In each case 
something was to be done in a particular manner; but what- 
ever may have been the consequences of doing it in some 
other manner, the invalidity of what was done was not one of 
those consequences ; and this appears to be the test whereby 
to decide whether a law is directory or imperative as those 
terms are customarihy employed (0- 

Statutes which are directory only are common enough, but 
it is not easy to recognise them with certainty before they have 
been judicially interpreted. There is, however, a natural ten- 
tency on the part of Courts of justice to uphold au honest 
transaction although somewhat irregular, if to do so is con- 
sistent with the true interpretation of the statute which has to 
be construed. The following illustrations of clauses held to 
be directory will serve as guides in other cases. 

In Foss v. Harbottlc (u), an act of Parliament incorporating Examples of so- 
the Victoria Park Company, declared that it should be in the ci auses . 
power of a certain number of shareholders, acting in a certain Foss v. 


(7) R. v. Birmingham, 8 B. & C. Ingall, 2 Q. B. D. 199 ; Hunt v. 

29. Hibbs, 5 H. & N. 123 ; Brumfitt v. 

(r) Payne v. Brecon, 3 H. & N. Bremner, 9 C. B. N. S. 1 ; R. v. 

572. Rochester, 7 E. & B. 910 ; Lancaster, 

(s) Le Feuvre v. Miller, 8 E. & B. Ac, Rail. Co. v. Heaton, 8 E. & B. 

321. 952 ; Calcine v. Pixell, 2 C. P. D. 

(t) For other instances of direc- 562. 
tory statutory enactments, see R. v. (u) 2 Ha. 461. 


Bk. II. Chap. 2. manner, and observing certain forms, to require the directors 
- to convene extraordinary meetings, and in case of their default, 

meetings. to convene such meetings themselves. A question having 

arisen how far it was necessary to adhere strictly to the letter 
of the enactment, in order to give validity to the acts of a 
meeting convened under it, the Vice-Chancellor, Sir James 
Wigram, expressed a strong opinion that the acts of a meeting 
convened in substantial compliance with the statute would be 
valid, although all the prescribed forms had not been observed. 
He considered the statute to be in this respect directory only. 

Quorum of In The Thames Haven and Dock Railway Company v. 

directors. . . ... 

Rose (x), a private act ot Parliament directed that the business 
of a company should be carried on by twelve directors, of 
whom five should be a quorum ; and the Court of Common 
Pleas was of opinion that the act was in this respect directory 
only, and that calls made by five out of seven directors, there 
being no more, were valid (y). 
Cases where a Again, it has more than once been held, that when a corn- 

been informally pany is incorporated by charter, or act of Parliament, which 
directs the observance of certain forms before the corporate 
seal is annexed to contracts purporting to bind the body cor- 
porate, a contract under the corporate seal, and of a kind 
authorised by the charter or statute, is binding on the corpo- 
ration, although the seal may have been annexed without the 
observance of the prescribed formalities (0). 
Signatures of g 0j i n the case of any ordinary joint-stock company, the 

deed of settlement of which declared that all cheques on its 
bankers Avere to be signed by three directors, and the directors 
drew cheques signed by less than three of them, it was held 
that this irregularity did not affect the right of the directors 
to be allowed as between themselves and the shareholders the 
sums drawn out, such sums having been bond fide applied for 
the purposes of the company (a). 

(x) 4 Man. & Gr. 552. B. 327, and 5 E. & B. 248 ; Agar v. 

(*/) Compare Kirk v. Bell, 16 Q. The Athenceum Life Assurance Society 

B. 290, and other cases cited ante, 3 C. B. N. S. 725. Compare D'Arcy 

pp. 155,156. v. Tamar, &c, Bail. Co., L. R. 2 Ex. 

(.-.-) See Fountaine v. Carmarthen 158. 
Bail. Co. 5 Ecp 316; The Boyal (a) Ex parte Big nold, 22 Beav. 143. 

British Bank v. Turquand, 6 E. & Compare Ex parte Agra and Master- 




So, clauses relating to the mode of signing minutes of meet- 1; ' ; lf - Chap. 

. Sect. i. 

ings, keeping registers, and making returns, so as to render 

them admissible in evidence without preliminary proof, are ',„•",,'. 

considered as directory only (h). 

As regards borrowing money, statutes limiting the amount Borrowing 

which may be borrowed are always regarded as imperative, 

as will be seen hereafter (c) ; but a statute authorising money 

to be borrowed with the consent of a general meeting was, as 

to this, held directory only (d). 

Sect. 43 of the Companies act, 18G2, which directs limited Non.-regL.try of 

companies to keep registers of all mortgages and charges has 

been held to be directory only ; and an unregistered mortgage, 
even to a director of the company, is not invalid (c). 

On the other hand, a clause in a company's regulations Proxy paper?. 
requiring proxy papers to be attested has been held to be im- 
perative, and proxy papers not so attested were rejected (/). 

These cases are not to be confounded with those in which Cases of estoppel 

to be distin- 
shareholders and companies have been held estopped from gaished. 

taking advantage of the non-observance of formalities. Such 

cases do not turn upon whether the clauses prescribing the 

formalities are directory or imperative ; but upon the very 

different question, whether, supposing them to be imperative, 

the invalidity of what has been done informally can be insisted 

on by those who have always treated it as valid, and induced 

others to do the same. 

When a contract has been entered into on behalf of a com- Ratification by 

. r. it " i companies. 

pany informally, but has been acted upon and is then disputed 
by the company, the question naturally arises whether it has 

man's Bank, 6 Ch. 206 ; Ex parte (d) Landowners, <ix., Inclosure Co. 

Birmingham Bank Co., 3 Ch. 651. v. Ashford, 16 Ch. D. 411. 

(6) See ante, p. 57, 102, 110, as to (e) Wright v. Horton, 12 App. Ca. 

registers and returns, and infra, book 37 1 . 

iii., c. 1, as to minutes of meetings. (/) Harhen v. Phillips, 23 Ch. D. 

(r) Infra, c. 3. 14, a dispute between shareholders. 


Bk " Sect 8 ? 1 *' 2 ' n0t been rat ^ ed or otherwise adopted by the company and so 
become binding on it. In order to answer this question, 
regard must be had first of all to the nature of the contract. 
If it is one by which the company would not have been bound, 
even if all proper formalities had been observed, ratification 
by the directors can be of no avail as against the company ; 
nor will ratification or adoption by the shareholders be of any 
avail against the company, if the contract in question is one 
into which the company has no power to enter (g). But if the 
contract would have been binding on the company, if all 
proper formalities had been observed, or if all the shareholders 
had concurred in it, ratification or adoption by or on behalf of 
the company is perfectly possible ; and the only question for 
determination then is, whether the contract has been effectually 
ratified or adopted or not (h). 

Acts done before A contract entered into or an act done before a company is 

the formation of . 

the company. formed cannot be ratified by it m the proper sense of that ex- 
pression. Ratification is a technical word and presupposes 
the existence — 1, of a principal; 2, of an agent; and 3, of 
some act done by the agent for and on behalf of the principal 
but without his authority (/). Where there is no principal 
there can be no agent and no act done by him for his prin- 
cipal, and consequently there can be no ratification — i.e., ap- 
proval by him of something previously done for him. A 
company therefore cannot, properly speaking, ratify what 
its promoters have done before its formation (k). But a com- 
pany may after its formation become bound to do what 
others have undertaken it shall do when formed. It ma}' 

(y) Ashbury Railway Carriage Co. & S. 29, and 1 Hem. & M. 672. 

v. Riche, L. E. 7 H. L. 653, noticed (//.) Irvine v. Union Bank of Aus- 

ante, p. 164. See, also, Chapleo v. tralia, 2 App. Ca. at p. 374, noticed 

Brunswick Building Society, 6 Q. B. infra. 

D. 696, at p. 711 ; Blackburn Benefit (i) Wilson v. Tumman, 6 Man. & 

Society v. Cunliffe, Brooks & Co., 29 Gr. 236. 

Ch. D. 902; Baroness Wenlock v. (/„•) See ace. Browne v. Lai rinidad, 

River Dee Co., 36 Ch. D. 675 n. ; 37 Ch. D. 1 ; Northumberland Avenue 

Imp. Bank of China, &c. v. Bank of Hotel Co., 33 Ch. D. 16. Compare 

Hindustan, 6 Eq. 91 ; Phoenix Life Howard v. Patent Ivory Manufactur- 

Ass. Co., 2 J. & H. 441 ; The Era ing Co., noticed infra. 
Co.'s case, 2 J. & H. 408 ; 1 De G. J. 


become so bound by its charter or act of incorporation, or by r>k - IT - c1i:i p- 2 - 

a valid contract entered into by itself after its formation. 

This subject, so far as regards charters and acts of incorpo- 

tion, lias been already examined (I), and as regards contracts 

made by the company after its formation, the reader is referred 

to § 2 of the present chapter, and to Howard v. Patent Ivory Howarj v. 

Manufacturing Co. (m), where a company was held bound by J, aten * ,vol ' : v 

J .1 \ n i j j Manufacturing 

debentures issued by it pursuant to arrangements made before Co. 
it Avas formed. But the new contract must, of course, be 
itself intra vires, or it will be worthless. 

Acts done by the agents of a company since its formation Acts don- since 

the formation of 

can be ratified by it, provided they are not ultra vires the the company, 
company (n). 

Moreover, although a company's articles cannot be altered 
for the future without a special resolution duly passed and con- 
firmed, an act done by the directors contrary to the articles as 
they stand may be ratified by the shareholders without altering 
the articles, and without any such special resolution as their 
alteration requires (o). 

A ratification, to be imputable to a company, must be made 
directly by its shareholders or indirectly through their agents 
acting within the limits of their real or apparent authority ; 
and in order that ratification by the shareholders or their 
agents may be proved, it must be shown — 

1. That the parties alleged to have ratified the contract 
knew what it was ; or, having their attention drawn to it, did 
not choose to inquire into it (p). 

2. That they have in some way recognised and adopted it. 
If these two essential points are established, there will still 

remain for consideration the question whether the recognition 

(I) Ante, p. 146. (o) Grant v. United Kingdom 

(m) 38 Ch. D. 156. See Ex -.parte Switchback Rail. Co., 40 Ch. D. 

Watson, 21 Q. B. D. 301, where the 135. See, also, Irvine v. Union 

deposit note was given in discharge Bank of Australia, 2 App. Ca. 366. 

of a debt not due from the society. Compare Clay v. Rufford, 5 De G. & 

(n) Ante, p. 166, et seq. ; V.-C. S. 760. 

Bacon in London Financial Ass. v. (p) See La Banque Jacques Cartier 

Kelk, 26 Ch. D. 146 & 151, seems v . La Banque, &c, de Montreal, 13 

to go even further if the cpiestion'of App. Ca. 111. 

ultra vires is doubtful. 

L.C. N 


Bk. II. Chap. 2. anc j adoption have been in proper form. Each of these matters 

Sect. 4. 

requires a few observations. 
l. As to know- First, as to knowledge. Where the contract is one which it 
is competent for the directors to make, it is also one which it 
is competent for them to ratify ; and in such a case knowledge 
by them is for the purpose in question equivalent to know- 
ledge by the company (//). The case of Smith v. Hall Glass 
Co. (r) is a leading authority on this head, and has been 
followed by others which have been already referred to (s). 
Where, however, the contract is one which it is not competent 
for the directors to make, ratification by them is of no avail ; 
and knowledge on their part of what is being done under the 
contract is not equivalent to knowledge on the part of the 
company. In such a case as this, ratification on the part of 
the shareholders must be proved, in order to establish rati- 
fication by the company (t). But even in this case, it will be 
inferred as against the shareholders, from comparatively slight 
circumstances, that they were cognisant of what it was the 
duty of the directors to bring before them (u). 
Knowledge by As in ordinary cases of agency a principal may ratify his- 

notdways 18 agents' acts without inquiring into them, so shareholders who 
essential. hnxe their attention fairly drawn to what the directors have 

done may ratify their acts without knowing all the circum- 
stances attending them. Ratification on the part of all the 
shareholders will be inferred if the acts are such as all can 
ratify ; if the attention of them all, or of such of them as 
choose to attend, has been fairly called to the acts in ques- 
tion (x), and if those acts have been permitted to be done or 
acted upon for any length of time without being called in 
question. Although cases exist which are extremely difficult 

(q) Implied knowledge from the case, 2 J. & H. 441. 
books of the company, but which (u) See Lane's case, 1 De G. J. & 

they never saw, is not enough. See S. 504. 
CartmeWs case, 9 Ch. G91. 0) Of course tin's is essential. 

(r) 8 C. B. G68, 11 ib. 897. See- Irvine, v. Union Bank of Aus- 

(s) See ante,]). 160, and Grady's tralia, 2 App. Ca. 366; Blackburn, 

case, 1 De G. J. & -Sin. 488. d-c, Building Society v. Cunliffe, 

(t) Athcnceum Life Assur. Soc. v. Brooks & Co., 29 Ch. D. 902, at p. 

Pooley, 1 Giff. 102,. and 3 De<i& J, 910; Grant v. United Kingdom 

■1\)[. See, also, Evans v. Smallcomle, Switchback Bail. Co., 40 Oh. D. 135. 
L. E. 3 H. L. 249: Burgesand Stock's 


to reconcile with this principle (y), the principle itself will be Bk. II. Chap. 2. 

found recognised even in those cases which have been decided 
not to fall within it (//). Others have been decided in accord- 
ance with it (z). A leading case on this subject is The Phos- Phosphate of 
phate of Li me Co. v. Green (a), in which it was held in effect : ,.'"!';,, 

1. That a purchase of shares by the directors of a company 
out of its funds was beyond the powers of the directors. 

2. That the money paid for them might have been recovered 
by the company but for the subsequent ratification of the trans- 
action. 3. That the company ought to be treated as having 
ratified the transaction, as it was fairly brought to the atten- 
tion of the shareholders (b), and had been allowed to pass un- 
questioned for five years, and had been treated as valid in 
other arrangements since made by the company. 

A ratification of a past irregular act does not of itself Ratification for 

. . past n °t equiva- 

authorise a repetition of a similar act ; and it ma}' happen that lent to authority 

whilst an ordinary meeting of shareholders may suffice to 
ratif} r what has been done, a different kind of meeting is re- 
quired to confer an authority to do the like in future. This is 
well illustrated by Irvine v. rnion Bank of Australia (c), in Irvine v. Union 

• -n • s~, ii- Hank of Aus- 

wnicn the directors of a Kice Company were empowered by its tralia. 
articles of association to borrow money to an extent not 
exceeding one half of its paid-up capital. The directors 
borrowed more than this from a bank which had notice of the 
restriction, and that the articles had not been altered b}' proper 
authority (d). The company was held not liable for. the sum 
thus borrowed in excess of the directors' powers, although the 
shareholders had ratified a similar transaction two years before. 

(y) Spachnan v. Evans, L. R. 3 (c) 2 App. Ca. 36G. Gh-ant v. 

H. L. 171 ; Houldsworth v. Evans, United Kingdom Sivitchhack Rail. 

ib. 263. Co., 40 Ch. D. 135. 

(z) Evans v. Smallcombe, L. R. 3 (d) The notice of the restriction 

H. L. 249 ; Brotherhood's casz, 31 was given by the articles of associa- 

Beav. 365, and 8 Jur. N. S. 926, on tion ; an alteration of them could 

appeal ; and the case next cited. only be made by a registered special 

(«) L. R. 7 C. P. 43. See, also, resolution. The bank was therefore 

London Financial Ass. v. Kelk, 26 treated as having had notice as 

Ch. D. 107, and the next case. stated in the text. The report does 

(b) Opinions might reasonably not state that the bank had notice 

have differed upon this point, as that the limit was in fact exceeded, 

the allusion to the transaction in but the writer assumes that it had. 
question was somewhat misleading. 

N 2 




2. Mode of 

Bk. II. Chap. 2. A ratification by the directors is not a" ratification by the 

- company where the ratification relates to an act clone by the 

toeltorfin cL directors in fraud of the shareholders, and the person relying 
!a f „ f lT!i!!L the on sucn ratification was party to the fraud (e). Therefore, if 
directors of a company fraudulently issue debentures under the 
seal of the company to a person privy to the fraud, and the 
issue of such debentures is entered in the company's books, 
and interest upon the debentures is regularly paid, but the 
shareholders are kept in ignorance of the entry and payments, 
the company is no more bound by ratification than by the 
original issue of the debentures. And inasmuch as a deben- 
ture is ti chose in action, and onby confers upon its assignee 
the title of its assignor, even a bond fide purchaser for value, 
without notice of any fraud, is in no better position against the 
company than the original payee; and the purchaser's position 
against the company is not improved by the recognition of his 
title by its directors (/). But, as before observed, a company 
may be estopped from denying as against a transferee the 
validity of an instrument it might impeach if in the hands of 
his transferor (g). 

Secondly, with respect to the mode of recognition and adop- 
tion. Assuming a contract to be one which the directors of a 
company have power to enter into, and that it has been entered 

(e) So an entry in the books of a 
bank, by its manager, making it 
appear that a debt due from him is 
due from the bank, does not bind 
the bank, La Banque Jacques Carticr 
v. La Banque, &c, de Montreal, 13 
App. Ca. 111. 

(/) Athcna'um Life Ass. Soc. v. 
Pooley, 1 GifF. 102, and 3 De G. & 
J. 294. This case was followed in 
JFood's claim and Brown's claim, 9 
W. E. 366, and 10 ib. 662. See, too, 
Burges and Stock's case, 2 J. & II. 
441. Compare JVoodhams v. Anglo- 
Australian Co., 3 Giff. 238 ; The 
Magdalena Steam Nav. Co., Johns. 
690 ; Hulett's case, 2 J. & H. 306, 
where the shareholders were not 
kept in ignorance of what had been 

done. The Athenaum Life Ass. 
Society v. Pooley appears at first 
sight to be opposed to Agar v. 
Athenceum Life Ass. Society, 3 C. 
B. N. S. 725 ; for in the latter case 
judgment Avas recovered in an action 
at law upon one of a set of deben- 
ture?, whilst in the former case 
others of the same set were held 
invalid. In the action at law, 
however, the only plea was non est 
factum, and no question of fraud, 
even if there was any in that case, 
was raised. But in the suit in 
ecpuity the dehenture was impeached 
for fraud, and was set aside on that 

(g) Ante, p. 171. 


into irregularly, and has been acted upon with their knowledge, r ' k - n - C1 >ap. 2. 

then, upon the principles already explain* d, the company ought - — - 

to be deemed to have ratified the contracl in question, and to 
be bound by it, unless some particular form of ratification is 
required by law, and that form has not hern observed. It has 
been already seen that the non-observance of particular for- 
malities prescribed by companies' deeds of settlement and 
regulations is immaterial as regards persons dealing bond fide 
with the directors without notice of the non-observance of the 
forms; and several instances have been already referred to in 
which informal contracts have been held binding on companies 
on the ground that the}- have been acted on with the knowledge 
of the directors (/<). A greater difficulty, however, arises where 
the formalities in question are required to be observed by law 
as distinguished from agreement between the parties. If in- 
formal ratifications of contracts informally entered into were 
in such cases held valid, the law requiring the observance 
of the formalities would be practically repealed. Upon this 
ground it is that the old rule of the common law that a body 
corporate can only be bound by instruments under its common 
seal has been so rigidly adhered to, even where the corporation 
has had the benefit of the contract (i). But even here, as will 
be seen hereafter, the equitable doctrines of part performance 
may come into operation and render the contract binding. 

(h) Ante, pp. 166-172. (i) Infra, c. 4. 




Bk. II. Chap. 3. Recapitulating the results arrived at in the foregoing 
Recapitulation, pages, it may be taken as settled that, — 

1. Companies can only be bound by the acts of their real or 
ostensible agents. 

2. The agents of a company cannot bind it by any act which 
the company as a body has no power to do. 

3. The agents of a company can bind it by all acts which 
can be shown to be within the limits of the authority really 
conferred upon them : 

4. And also by acts, which, although not themselves autho- 
rised, belong to a class which is ; and which acts, therefore, 
may be authorised for anything that can be learned to the 
contrary by an examination of the authority conferred. 

5. As regards acts of this last description, the neglect of 
directors to observe the provisions of their company's deed of 
settlement or regulations is a matter which does not concern a 
person dealing with them bond fide without notice of the non- 
observance of those provisions. 

6. The above rules apply as well to ratifications of contracts 
previously entered into as to other matters. 

7. But a company cannot ratify acts done before it came 
into existence ; although it may bind itself by a new contract, 
or be bound by its act of incorporation, to perform them. 

8. Where particular formalities are required to be observed 
by law in order that a contract may be binding, an informal 
ratification of an informal contract is of no avail, except in the 
limited class of cases to which the equitable doctrines of part 
performance are applicable. 


!). Bui as regards matters which are nol beyond the powi • ■'■■ Chap. 3. 

of all the shareholders, they or the company will be held to ^— - 

have ratified what they might have disputed, provided th 
attention has been fairly called to it, and they have uol cho 
to question it. 

It is necessarj next to illustrate the application of th 
general principles to particular cases. 


Admissions. — Admissions made by the servants and officers Admissions, 
of a company in the course of their business and relating to 
matters which it is their duty to transact are admissible in 
evidence against the company (a). But not other admissions. 
In The Devala Provident Gobi Mining Company's cas .,, & c ., 

speech by the chairman of a meeting to the shareholders of ? 

* C8 

a company admitting that the prospectus was false, was held 
inadmissible against the company in a proceeding to set aside 
an allotment of shares applied for on the faith of the pro- 
spectus. So an admission by a liquidator was held insufficient 
proof of facts relied on for the purpose of setting aside an 
amalgamation (c). 

See further, infra, Representations. 

Amalgamation. — Directors of companies have no power to Amalgamation 
amalgamate their respective companies unless such power is ° f comparues - 
expressly or impliedly conferred upon them. 

General powers of management do not include a power to 
purchase the business of another company (d), or to sell the 
business of one's own company (e). Whether such a power 

(a) See Bell v. L. & N. W. Rail. 401. See, too, Gilbert v. Cooper, 10 
Co., 15 Beav. 448 ; Meux's Exors. Jur. 580 ; Beman v. Bufford, 1 Sim. 
case, 2 De G. M. & G. 522 ; and K S. 550 ; Clay v. Bufford, 5 De G. 
Barnett, Hoares &• Co. v. South Lon- & Sm. 768 ; and see the next two 
don Tramways Co., 18 Q. B. D. 815. notes. 

(b) 22 Ch. D. 593. ( e ) See Ex parte The Liquidators 

(c) Empire Corporation, 17 W. R. of the British Nation, dx., Association, 
43L 8 Ch. D. 679. 

(d) Ernest -v. Nicholls, H. L.' C. 


Bk. II. Chap. 3. can oe conferred on directors by a meeting of shareholders has 

Sect. 1. J & 

been much discussed, and is scarcely yet settled. Such a 

purchase generally involves the assumption by the purchasing 
company of the debts and liabilities of the selling company, 
and it is difficult to hold that a transaction of this kind is one 
as to which a majority ought to be able to bind a minority (/). 
The amalgamation of^isurance companies is now governed 
by 33 & 34 Vict. c. 61, and 34 & 35 Vict. c. 58, as amended 
by 35 & 36 Vict. c. 41. 

See further infra Sales, and Book IV. c. 2, § 4. 

Arbitration by Arbitration. — The question whether the directors of a com- 

compaaies. . 

pany can bind it by agreeing to refer a dispute to arbitration 
has not been decided. But the power to bring and defend 
actions involves a power to compromise them. 

See infra, Compromise. 

By the Railway companies arbitration act, 1859 (g), railway 
companies are empowered to refer to arbitration any matters 
in which they are mutually interested, and which they might 
lawfully settle by agreement amongst themselves ; and by the 
Companies act, 1862 (h), companies governed by that act are 
also empowered to refer disputes with other companies or 
persons to arbitration, in accordance with the Railway com- 
panies arbitration act, 1859. 

Where a company has entered into an agreement which is 
ultra vires, any agreement to refer disputes arising out of it to 
arbitration is equally ultra vires (i). 

(/) Compare upon this subject not enable directors to force their 

the judgments in the cases of the own shareholders to take shares in 

Era Assurance Soc, 2 J. & H. 400 ; another company. Higg's case, 2 

and of the Saxon Life Assurance Hem. & M. 657 ; Ex parte Bagshaw, 

Soc, ib. 408, and 1 De G. J. & Sm. 4 Eq. 341, and see, as to the con- 

29, and 1 Hem. & M. 672. See, struction of such powers, Stace and 

also, Reams v. Leaf, and Aldebert v. Worth's case, 4 Ch. 682; Bank of 

Kearns, 1 Hem. & M. 681. In Ex Hindustan v. Alison, L. R. 6 C. P. 

parte Bagshaw, 4 Eq. 341 ; Anglo- 54, and 222. 

Australian Assurance Co. v. British (g) 22 & 23 Vict. c. 59. See L. C. 

Prov. Life, &c, Soc, 3 Giff. 521, and & D. Bail. Co. v. S. E. Rail, Co., 

4 De G. F. & J. 341, the power to 40 Ch. D. 100, as to jurisdiction of 

purchase was conferred by the deed the Court, 

of settlement, and see Argus Life (h) §§72 and 73. 

Ass. Co., 39 Ch. D. 571. But even an (i) Maunsell v. Midland Greed 

express power to amalgamate does Western Bail. Co., 1 Hem. & M. 130. 



Bills of exchanqe and promissory notes. — Whether directors, bl II. ciiap. 3. 

J J 2 . . Ll. 

secretaries, or managers of companies have implied power to 


bind the companies to which they belong by bills 01 excnari 
and promissory notes, depends partly on the statutes relating 
to the privileg< 5 of the Dank of England (k). But where these 

statutes do not apply the power depends on the nature of the 
company. If its business is such thai i: cannot be carried on 
in the ordinary way without the use of bills, &c, its direel 

have power to draw, accept, and indorse them in the name and 
on behalf of the company (/), in the ordinary course of the 
company's business (m). But if its business is not of this 

description, there is prima facie no such power (n). This has 
been decided in the cases of a salvage company (<>), a mining 
company (}>), a gas company (q), a washing company (r), a salt 
and alkali company (s), a waterworks company (t), a cemetery 
company (u), a railway company (•'')• 

"Where the directors of a company have power to bind it 
by bills and notes, a bill or note issued by them improperly but 
in the name of the company, is binding on it in favour of any 
b nil} fide holder for value without notice of the impropriety (y). 

(k) As to which see ante, p. 136, 
note (/). 

(I) See per Parke, B., and Rolfe, 
B., in Mayor of Lvdlow v. Charl 
6 M. & W. 821, and per Best, J., in 
Broughton v. Manchester and Salford 
Wai rworks Co., 3 B. & A. 1. See, 
also, Murray v. East India Co., 5 
ih. 204 ; Peruvian Bail. Co. v. 
Thames, dr., Ins. Co., 2 Ch. 617 ; 
Ex parte City Bank, 3 Ch. 758. 

(m) Simpson's Claim, 36 Ch. D. 

(n) The Bills of Exchange act, 
1882, does not extend the power. 
See § 22 (1). 

(o) Thompson v. Universal Salvage 
Co., 1 Ex. 694. 

(£>) Dickinson v. Valpy, 10 B. & 
C. 128 ; Brown v. Byers, 16 M. & 
W. 252. 

(q) Bramah v. Roberts, 3 Bing. 
N. C. 963. 

(r) Neale v. Turton, 4 Bing. 149. 

(s) Buli \. Mo ll, L2A.&E.745; 
see the judgment of ( loleridge, J. 

(t) Broughton v. Ma hosier, dr., 
W< i . :; B. & A. 1. 

(m) Steele v. Earmer, 14 M. & W. 
831, reversed, hut not on this point, 
4 Ex. 1. 

(.'•) Bateman v. Mid-Wales Rail. 
Co., L. E. 1 C. P. 499. Compare 
Peruvian Rail. Co. v. Thames, &c, 
Ins. Co., 2 Ch. 617, where the 
power was held to be conferred 
by the general words of the articles 
of association. 

(y) Ex parte Overend, Gurncy, & 
Co., 4 Ch. 460 ; Gordon v. Sea Fire 
and Life Assurance Co., 1 H. & X. 
599 ; Thompson v. The Wesleyan 
Newspaper Association, 8 C. B. 849 ; 
Alhii v. Sea Fire and Life Assurance 
Co., 9 C. B. 574 ; Forbes v. Marshall, 
11 Ex. 166 ; Maclae v. Sutherland, 3 



Bk. II. Chap. 3. 
Sect. 1. 

Bill in Parlia- 




Before leaving the subject of negotiable instruments it may- 
be observed that it is often difficult to say whether they purport 
to be the paper of a company or only that of some one or 
more of the directors. Unless the paper purports to be the 
paper of a company no one whose name is not on the paper is 
liable to be sued on it (z). This subject will be adverted to 
hereafter (a). 

Bill in Parliament. — It will be seen hereafter that it is 
not competent for the directors of a company to employ 
its funds in endeavouring to obtain an act of Parliament 
authorising it to engage in businesses for which it was not 
formed (b). And a contract by one railway company with 
another, to the effect that the first shall take a lease of the 
line of the second and pa}- the expenses of an application to 
Parliament for an act extending and improving such line 
has been held illegal and void (c). But in a more recent 
case, it has been held that a railway company is liable to 
pay for surveys, plans, &c, made by order of its directors 
for the purpose of an application to Parliament for an exten- 
sion of powers (d). 

Bonds, see infra, Borrowing money, Debentures, Mortgages. 

Borrowing money. — One of the most important questions 
respecting the powers of directors, and one which is constantly 

E. & B. 1. See, also, the judgment 
of Holroyd, J., in 3 B. & A. 10, 
and compare Stark v. Highgate 
Archway Co., 5 Taunt. 792. In 
Aggs v. Nicholson, 1 H. & N. 165 ; 
and Lindus v. Melrose, 2 ib. 293, 
and 3 ib. 177, the point decided was, 
that the defendants were not per- 
sonally liahle on the notes there in 
question. These cases by no means 
decided that the companies would 
have been liable without proof of 
authority in their directors to issue 
notes on their behalf. The mar- 
ginal notes of the reporters go too 
far, and are apt to mislead. In 
Halford v. Cameron's Goalbrooke, dbc., 
Co., 16 Q. B. 442, and Edwards v. 
Cameron's Goalbrooke, &c, Co., 6 Ex. 

269, the action Avas against the 
company, but the authority of the 
directors to bind it by bills was not 
in issue. 

(z) Bills of Exchange act, 1882, 

(a) Infra, c. 4, § 3. 

(h) Infra, B k. HI, c, 2, § 2: c . / / 3 . f, 

(c) Eastern Anglian Rail. Co. v. 
Eastern Counties Bail. Co., 11 C. B. 
775. See, also, McGregor \. Dover 
and Deal Rail. Co., 18 Q. B. 618 ; 
Maiin sell v. Midland Great Western 
Rail. Co., 1 Hem. & M. 130; Taylor 
v. Chichester and Midhurst Bail. Co., 
L. Pt. 2 Ex. 356, and 4 H. L. 628. 

(cl) Bat', man v. Mayor of Ashton- 
under-Lyne, 3 H. & N. 323 ; Bram- 
well, B., dissented. 


arising in practice, is whether they can borrow money for their l;k - J J- Ch*P- '■'>■ 
company and render their company liable to repay it. 

Whenever this question arises, the first point to determine is ] ;, growing ultra 
whether the company is one which cannot lawfully borrow 
money at all, for if all borrowing is ultra vires, it follows that 
it cannot be liable as debtor (e) to repay what its directors 
may have assumed to borrow for it (/). 

Supposing that all borrowing is not ultra vires, the next 
point to determine is whether there is any statutory or other 
limit to the amount which may be borrowed; and whether this 
amount has been already raised so as to render an}" further 
exercise of the power to borrow, not only irregular and improper 
as an excess of authorhy, but wholly ultra vires. If this be 
the case, it will again follow that, to the extent to which the 
borrowing powers have been exceeded, the company will not be 
liable to repay what may in fact have been borrowed in its name 
and on its credit (g). 

Supposing, thirdly, that borrowing is not ultra vires as re- Borrowing 
gards the company, its liability for money borrowed in its name 
will depend upon whether the directors had authority, express 
or implied, to borrow money for the company ; for if not, the 
company will not be liable to repay what its directors may in 
fact have borrowed for it, unless the company has ratified the 
borrowing (Ji). 

Supposing, lastly, that borrowing is intra vires so far as the 
company is concerned, and thatthe directors have implied though 
no express authority to borrow, and they do borrow money for and 
on behalf of the company, then the company will be liable to 
repay it, unless there has been some excess of real authority 
known to the lender (/). 

Cases in which the directors of a company have power 
to borrow, and do borrow for and in the name of the 

(c) As to liability arising from and 9 App. Ca. 857 ; Baroness Wen- 

the application of the money, see lock v. River Dee Co., 36 Ch. D. 

infra, c. 5. 675, note, and 10 App. Ca. 354 ; and 

(/) Montreal Assurance Co. v. see further on other points, 38 Ch. 

McGillivray, 13 Moo. P. C. 87, and D. 534, aft'. 36 ib. 674, and 19 Q. B. 

the cases in the next note. D. 155. 

(y) Blackburn Building Soc. v. (h) See ante, 166, &c, 175, &c. 

Cunliffe, Brooks <b Co., 22 Ch. D. 61, (i) See ibid. 



Application of 
the money. 

Bk. II. Cbap. 3. company, give rise to no difficulty, and need not be further 
— — alluded to. 

Again cases in which the directors of a company borrow as 
principals, and not for or in the name of the company, give 
rise to no difficulty, for ex hypothcsi the money borrowed has 
not been lent to or borrowed by the company. 

"When money is so borrowed for a company as to render the 
company liable to repay it as a debt of its own, it is quite 
immaterial to the lender what has been done with the money ; 
the application of the money in the case supposed is no concern 
of his, and in no way affects his rights. But if money is so 
borrowed for a company as not to render the company liable 
to repay it as a debt of its own, still the lender may not be 
wholly without remedy against the company. The application of 
the money then becomes important, and may render the compan} r 
liable to repay him in whole or in part, as will be more fully 
explained hereafter {infra, Book II. c. 5). 

Having made these general observations, it is proposed to 
notice the leading decisions on the subject. 

Whether all borrowing is ultra vires, whether only borrowing 
beyond a certain amount is ultra vires, whether there is any 
and what authority on the part of directors or others to borrow 
(assuming no question of ultra vires to arise), are all questions 
which depend on the nature of a company's business, and upon 
the terms of its charter, act of Parliament, deed of settlement, 
or regulations. 

It is very seldom that the nature of a company is such as to 
render all borrowing under all circumstances ultra vires, so 
that even all its members cannot sanction a loan to it for any 

But there are numberless companies which have by statute 
or charter power to borrow to a limited extent (A;), and there 
are numerous cases establishing that loans to such companies 
beyond the authorised amount are invalid. The two most 

power to 

(A-) E.g., railway, canal, and other 
companies which obtain special acts 
and limited borrowing powers. See, 
as to them, S & 9 Vict. c. 16, §§ 38, 
et seq.; 16 & 27 Vict, c, 118, §§ 22- 

35 ; 29 & 30 Vict. c. 108 ; 32 & 33 
Vict. c. 48, § 1 ; and 38 & 39 Vict. 
c. 66. As to loan notes, &c, im 
properly issued, see 7 & 8 Vict. c. 
85, § 19. 


recent and instructive decisions on this point are Baroness Bk. IJ. Chap. 3. 

Sect. 1. 

Wenlock v. River Dee Co., and The Blackburn Building Society 

v. ('mil [ifc, Brooks <('• < '<>. 

In the Baroness Wenlock v. The River Dee Co. (1), & com- Baroness Wen- 
panywaa formed to improve the river Dee and lands adjoining, DeeCompanv 
and was empowered to borrow 25,000/. on mortgage. The 
directors borrowed 85,000/., which was applied in paying off a 
previous mortgage of 60,000/. In an action to recover the 
85,000/. and interest, it was held that the plaintiff was only 
entitled to recover 25,000/., and so much more as had been 
applied in payment of debts and liabilities of the company 
properly incurred (/»)• 

The borrowing powers of benefit building societies are Building 
strictly defined by statute (n). Such societies are empowered 
to borrow money up to a certain limit if their certified rules 
enable them so to do (o). But apart from the acts and the 
rules there is no power to borrow (j>). Consequently if money 
is borrowed by the managers of the society for it, the society 
itself is not liable to repay the amount (q), although the 
managers are personally liable to repay it by virtue of an 
express enactment to that effect (r). So stringent is the law 
limiting the borrowing powers of these societies, that if money 
is borrowed beyond the authorised amount, and the amount so 

(/) 10 App. Ca. 354, and 30 Ch. money for shares hi advance, Guar- 

D. 675, note, and 19 Q. B. D. diem, &c, Building Soc, 23 Ch. D. 

155. See also, Landowners, (fee, In- p. 453. 

closure Co. v. Ashford, 10 Ch. D. Q<) See, in addition to the cases 

411. cited below, Kent Benefit Build. Soc, 

(to) See as to this, infra, c. 5. 1 Dr. & Sm. 417 ; Ex parte IVilliam- 

(n) 37 & 38 Vict. c. 42, §§ 15, 16 ; son, 5 Ch. 309. 
38 Vict. c. 39. (q) Ghapleo v. Brunswick Build. 

(o) The rules need not themselves Soc, 6 Q. B. D. 696 ; Blackburn 

limit the amount : Murray v. Scott, Build. Soc. v. Cunliffe, Brooks d; Co., 

9 App. Ca. 519, and 23 Ch. D. 440, cited below. See also, Ex parte 

sub nom., Guardian Permanent Watson,21 Q. B. D. 301, where the 

Build. Soc; Mutual Aid Build. Soc, society acquired borrowing powers 

29 Ch. D. 182, and 30 ib. 434 ; and then gave a note for money 

Laing v. Reed, 5 Ch. 4. These previously borrowed, 
authorities overrule Hill's case, 9 Eq. (r) 37 & 38 Vict. c. 42, § 43 ; 

605, and Davis' case, 12 Eq. 516. Ghapleo v. Brunswick Build. Soc, ubi 

See as to the difference between supra ; Looker v. Wrigley, 9 Q. B. 

borrowing money and receiving D. 397. 



Bk. II. Chap. 3, 
Sect. 1. 

Building Society 
v. Cunlitfe, 
Brooks & Co. 

Ex parte 

power to 

borrowed is actually repaid out of the funds of the society, such an 
application of the funds is ultra vires, and the amount so repaid 
can be recovered hack by the society from the lender of the money. 
This was decided in The Blackburn, &c, Building Society v. 
Cunlife, Brooks & Co. (s). It had been previously decided 
that the bankers could not recover the amount of the society's 
overdraft nor hold securities given for it except to the extent 
to which the moneys advanced had been properly applied in 
discharging liabilities of the company (.ss). 

It has also been decided that where money was borrowed for 
a building society which had no power to borrow, a note given 
by it for repayment of the money was invalid, although the 
society had acquired power to borrow before it gave the note (/). 
There was in this case no compromise and no consideration for 
the note to render it intra vires. The note was clearly not 
given for money borrowed when there was power to borrow ; 
there was no fresh borrowing. 

Passing now to cases unaffected by the doctrines of ultra 
vires, the directors of ordinary trading companies, whose regu- 
lations are silent on the subject of borrowing, have an implied 
power to borrow for the purposes of the business of the com- 
pany (w), but the directors of other companies have, it is con- 
ceived, no such implied power (a?). 

A power to borrow is so necessary to a banking company that 
its directors can scarcely be deprived of it ; and there are several 
cases in the books in which their power was held to have been 
exercised so as to bind the company (y). Moreover, although the 
directors of a company may have no power to borrow, power so 
to do may be conferred upon them by the shareholders ; for 
this is a matter as to which a majority can bind a minority (z), 

(s) 29 Cli. D. 902. 

(ss) Gunliffe, Brooks cfJ Go. v. Black- 
burn Build. Soc, 9 App. Ca. 857, 
and 22 Ch. D. 61. 

(t) Ex parteWatson,21 Q.B.D. 301. 

(«) Ex parte Pitman d> Edwards, 
12 Ch. D. 707, and the next four 

(x) See the judgment of L. J. 
Bowen in 36 Ch. D. 685, note. 

(y) Bank of Australasia v. Breil- 
lat, 6 Moore, P. C. 152, and 12 Jur. 
189 ; Maclae v. Sutherland, 3 E. & 
B. 1 ; Royal Brit. Bank v. Turquand, 
5 ib. 248, and 6 ib. 327 ; Galloway's 
case, 18 Jur. 885. 

(a) Bryon v. Metropolitan Saloon 
Omnibus Co., 3 De G. & J. 123. As 
to unincorporated building societies, 
see 29 Ch. D. 902. 


unless borrowing is ultravires as regards the company itself." Bk « H- Ch . a P- 3 - 

° # . Sect. 1. 

Further, if the directors have already power to do whatever the — 

company itself can do, this includes a power to borrow (a), 

if to borrow is intra vires. Moreover, a special power given to 

the directors to borrow to a certain extent does not preclude 

the company from borrowing to a greater extent with the 

sanction of the shareholders (6). 

Borrowing imports the creation of the relation of debtor and What is bor- 
creditor, and whenever money is obtained upon terms which 

produce this relation, there is in substance a borrowing; e.g., 
overdrawing a banking account is borrowing (c). But mort- 
gages and charges may be created on property, and the remedy 
of the lender may be confined to realising his security ; whether 
such securities are valid as against any particular companj', 
must be decided upon the principles already explained. But 
where directors have no power to borrow, they have no power 
to raise money on such securities, unless such power can be 
shown to exist (d). It is not, however, every transaction by 
which money is obtained that can be considered borrowing, 
even although the transaction involves the payment of money 
by the person who obtains the money, to the person from whom 
it is procured ; the transaction ma}' be a sale and rehiring, and 
such a transaction, if bona fide and not a borrowing in disguise, 
will be valid, although there may be no power to borrow {del). 
Further, giving a note for an existing debt not due from the 
company, is not a borrowing by the company (<?). 

Connected with the subject of borrowing money, is increasing Increasing 
capital. The difference between them is illustrated by Bryon „ pi ' , r ± 

->< f Bryon v. Metro - 

v. Metropolitan Saloon Omnibus Company (f). In that case poiitan Saloon 
the capital of a limited joint-stock company had been expended, pan y. 

(a) Australian Steam Clipper Co. and Cefn Cilcen Mining Co., 7 Eq. 
v. Mounsey, 4 K. & J. 733 ; Gibbs 88, contra, are overruled by the 
and West's case, 10 Eq. 312. above. 

(b) Irvine v. Union Bank of (d) See Baroness Wenlock v. River 
Australia, 2 App. Ca. at p. 374. Dee Co., ubi supra. 

(c) Blackburn Building Soc. v. (dd) Yorkshire Bail. Waggon Co. 
Cunliffe, Brooks & Co., 9 App. Ca. v. Maclure, 19 Ch. D. 478, and 21 
837, and 22 Ch. D. 61 ; Landowners' ib., 309. 

<fec, Inclosure Co. v. Ashford, 16 Ch. (e) Ex parte Watson, 21 Q. B. D. 

D. 437 ; Looker v. Wrigley, 9 Q. B. D. 301. 

397. Waterlow v. Sharp, 8 Eq. 501, (/) 3 De G. & J. 123. 



Bk. II. Chap. 3. an( J a majority of shareholders proposed to borrow money on 

Sect. 1. . .... 

— the credit of the company. A dissentient minority sought to 
restrain the majorit} r from so doing, and reliance was placed on 
the doctrine that the capital of the company could not be 
increased by borrowing money without the consent of all the 
shareholders. But it was held competent for the majorit} 7 to 
borrow money on the credit of the company, and that the 
doctrine relied on had no application to the case ; the capital 
of the company being one thing, and that which was sought to 
be increased b}' borrowing (viz., the cash in hand) being a 
different thing. 

The difference between borrowing money and procuring 
goods or services on credit is not only obvious (<j), but is practi- 
cally important, as is shown by the cases in. which members of 
cost-book mining companies have been held liable for goods 
supplied to the mine (//), but not for money borrowed (i). 

An authority to borrow does not warrant the issue of deben- 
tures except to secure money lent or to discharge a liability (k) ; 
nor does an authority to borrow on the security of the funds 
and property of a company justify a mortgage of its uncalled- 
up capital (/) ; but future debts may be charged by way of 
security (m). Where directors have power to borrow on mort- 
gage but not on bills of exchange, a mortgage to secure money 
borrowed and for which bills have been given, is not invalid («). 

Obtaining goods ] 
on credit. 

Exercise of 
power to borr 

(g) Partn. 133. 

(h) Tredwen v. Bourne, 6 M. & 
W. 461 ; Haicken v. Bourne, 8 ib. 

(i) Haidayne v. Bourne, 7 M. & 
TV. 595 ; Burmester v. Norris, 6 Ex. 
796; Bicketts v. Bennett, 4 C. B. 
686 ; Brown v. Byers, 16 M. & W. 
252 ; Beldonv. Campbell, 6 Ex. 886. 

(It) Inns of Court Hotel Co., 6 Eq, 
82 ; West Cornwall Bail. Co. v. 
Mowatt, 12 Jur. 407. 

(/) English Channel Steam Co. v. 
Bolt, 17 Ch. D. 715 ; Ex parte Brad- 
sluiw, 15 Ch. D. 467 ; Stanley's case, 
4 De G. J. & Sm. 407 ; Bank of S. 
Australia v. Abrahams, L. E. 6 P. C. 

265 ; and see King v. Marshall, 33 
Beav. 565. Calls actually made, 
Gibbs and West's case, 10 Eq. 312; 
Sanlcey Brook Coal Co., No. 2, ib. 
381, and calls actually determined 
to be made, although not actually 
made, Sankey Brook Coed Co., No. 
1, 9 Eq. 721, may be mortgaged. 
So may uncalled-up capital if the 
power extends to the properties and 
rights of the company, Howard v. 
Patent Ivory, &c, Co., 38 Ch. D. 

(m) Bloomer v. Union, etc., Coal 
Co., 16 Eq. 383. 

(n) Scott v. Colburn, 26 Beav. 276. 


Indeed, where the power to borrow exists and money is bor- I5k - H- C^p- 3 - 

Sect. 1 . 

rowed, a debt is contracted, although the security given for it - 
may be informal (o). 

Where the directors of a company have power to borrow, Loans i>y 
there is nothing now to prevent a loan to the company by one 
of themselves ( p). 

The validity of securities improperly issued depends on the Validity of 
principles above explained. If they are ultra rires they are properly V^^ 1 '- 
invalid and worthless even in the hands of bona fide holders for 
value, except so far as the money the}' represent can be recovered 
by reason of its having been applied for the benefit of the com- 
pany (q). But where the doctrines of ultra vires do not apply, 
securities which are improperly issued are invalid in the hands 
of persons having notice of the impropriety (r), and also in the 
hands of their transferees if the securities are mere choses in 
action and are not negotiable, and if the company is not 
estopped as against such holders from denying the validity of the 
securities (s). But if the securities are negotiable (t), or if they 
create a legal charge (u), or if, although they are not negotiable 
and are mere choses in action, the company is estopped, as 
against a bond fide transferee for value without notice of any 
impropriety, from disputing their validity (x) such a trans- 
feree can enforce them against the company. 

Borrowed or loan capital (y) may be properly referred to in Borrowed 

• capital. 

connection with this subject. The right to raise it depends 
on the principles already alluded to. There are, however, 
several very important statutory enactments relating to the 

(o) See Strand Music Hall Co., 3 Co., 38 Ch. D. 156. 

De G. J. & Sm. 147 ; Boss v. Army (s) Athenceum Life Ass. Co. v. 

and Navy Hotel Co., 34 Ch. D. 43. Pooley, 1 Giff. 102, and 3 De G. & 

(p) Campbell's case, 4 Ch. D. 470. J. 294, ante, p. 180. 

It was otherwise under 7 & 8 Vict. (t) Ante, p. 171. 

c. 110, as to which see T ever sham («) This is inserted on general 

v. Cameron 's Coalbrook Co., 3 De G. principles ; no case actually deciding 

& S. 296 ; Bakers case, 1 Dr. & the point has been found. 

Sm. 55 ; Murray's Ex. case, 5 De G. (x) As in Romford Canal Co., Ca- 

M. & G. 746. rew's claim, 24 Ch. D. 85 ; Webb 

(q) See ante, p. 162, etseq. and infra, v. Commissioners of Heme Bay, L. 

p. 237, Landowners, dec, Lnclosure R. 5 Q. B. 642. 

Co. v. Ashford, 16 Ch. D. 434. (y) As to this use of the word 

(r) Howard v. Patent Ivory, <kc, "capital" see bk. hi., c. 3, § 1. 

L.C. O 


Bk. II. Chap. 3. borrowed or loan capitals of companies incorporated by 
— special acts of Parliament and governed by the Companies' 
clauses consolidation act, 1845, and these enactments require 

s & 9 Viot c 16. By ^ ie ac t m question, railway and other companies governed 
by it are empowered to raise money by mortgage or bond by 
the order of a general meeting (z). But this order is not 
essential to the validny of the securities issued (a). The 
bonds or mortgages rank pari passu as between their respec- 
tive holders inter se, without reference to their respective 
dates (b). A register of the bonds and mortgages is required 
to be kept, and the holders of them are entitled to inspect the 
register (c). The bonds or mortgages are transferable b} r 
deed (d), and the transfer must be registered in order to com- 
plete the title of the transferee as between himself and the 
company (e). The interest on the bonds and mortgages is 
paj^able in priority to dividends to shareholders (/). As 
regards repayment of the principal sum, a day for repayment 
ma}' be fixed in the bond or mortgage, or no time for repay- 
ment may be fixed. If a day for repaj-inent is fixed the prin- 
cipal sum then becomes a debt for which an action maj r be 
brought (g). If no time be fixed the creditor may call in the 
money twelve months after the date of the bond or mortgage 
on giving the company six months' notice (/*). The company 
may pay it off on giving a like notice (i). The most effectual 
remedy for enforcing payment is to obtain a receiver ( j) ; and 
if the special act authorises the mortgagees to apply for a 
receiver, they can obtain one from two justices of the 
peace (k). 

(z) 8 & 9 Vict. c. 16, §§ 38, 39, (cj) § 50. Price v. Great Western 

40. Rail. Co., 16 M. & W. 244 ; Vertue 

(a) Fonntaine v. Carmarthen, <£c, v. East Anglian Bail. Co., 5 Ex. 
Bail. Co., 5 Eq. 316 ; Romford Canal 280, shows that a transferee can 
Co., 24 Ch. D. 85. sue in his own name. See infra, 

(b) §§ 42, 44. See Boioen v. Bre- c. 7. 

con, d-c, Bail. Co., 3 Eq. 541. ' (h) § 51. 

(c) § 45. (i) § 51. 

(d) § 46. (j) Infra, c. 7. A hond creditor 

(e) § 47. See Doe v. Jones, 5 Ex. must first recover judgment. 
16 ; Lane v. Smith, 14 Beav. 49. (k) §§ 53 & 54. 

(/) § 48. 


The Railway companies securities act, 18G6 (I), also con- 1;k - Ir Cha P- '■'•■ 
tains important provisions relating to the registration of 

persons authorised to issue securities, to rendering accounts 
of loan capital, and to the endorsement on bonds and mort- 
gages of certain particulars in order to prevent over-issues. 

The Railway companies act, 1867 (in), protects the rolling 
stock of railway companies from seizure (//), and declares 
that money borrowed on mortgage bond or debenture 
stock under any special act shall have priority over other 
claims arising after August, 1867, with some few excep- 
tions (<>). 

This act was passed after the decision of Gardner v. London, Ghudnei ,-. 

n •? /-i • London, Chat- 

Chatnam d- Dover Railway Co. (j>), which settled that mort- ham, and Dover 

gagees of a railway company's " undertaking " are not entitled pany. 
to any specific charge upon the company's stock or surplus 
lands, but are only entitled, so long as the company is a going 
concern, to a receiver of its earnings. The effect of the 
priority clause just alluded to does not affect this decision ; 
and notwithstanding that clause, a judgment creditor can 
obtain a sale of the surplus lands and payment out of their 
proceeds in priority to mortgagees of the company's under- 
taking (q). The clause in fact only comes into operation when 
there is a receiver of the earnings, when there is a scheme of 
arrangement, and when the company is being wound up under 
the Railway abandonment act (r). 

Debenture stock is merely borrowed capital consolidated Debenture 


into one mass for the sake of convenience. Instead of each 
lender having a separate bond or mortgage, he has a certificate 
entitling him to a certain sum, being a portion of one large 
loan. The debenture stock of railway companies and of other 
companies created by special act of Parliament and governed 
b}* the Companies' clauses consolidation act, 1845, is regulated 

(I) 29 & 30 Vict. c. 108. injuriously affected. 

(m) 30 & 31 Vict. c. 127. (p) 2 Ch. 201. This is the lead- 

(n) § 4, and see infra, c. 7. ing case on these securities. 

(o) lb. The exceptions are rent- (q) Hull, Barnsley, dec, Rail. Co., 

charges granted under the Lands 40 Ch. D. 119. 

clauses acts, rents payable under (r) lb., and see infra, bk. iv., 

leases, claims for lands taken or c. 3. 

o 2 


Bk. II. Chap. 3. l, y a variety of statutes of which the principal are the Coin- 
Sect, l. J * L x 

- panies' clauses act, 1803 (26 & 27 Yict. c. 118), the Railway 

companies' securities act, 1866 (29 & 30 Vict. c. 108), and the 

Railway companies act, 1867 (30 & 31 Vict. c. 127), to w T hich 

the reader is referred for further details. 

See further, Debentures ; Mortgages. 

Cheques. Cheques. — The bankers of a company which has no proper 

directors ma}'', nevertheless, safely pay cheques drawn in its 
name by those persons who in fact carry on its business, unless 
the bankers are aware of their want of authority (s). 

Overdrawing is borrowing ; and bankers who allow com- 
panies which have no power to borrow to overdraw their 
accounts cannot recover the amount overdrawn from the 
company (t). 

Bankers who allow a company to overdraw its account have 
no remedy against the directors personally ; although they 
may have signed the cheques or authorised others to sign 
them (u). But as regards building societies, the law is other- 
wise by virtue of 37 & 38 Vict. c. 42, § 43 (x). 

Compromises. Compromises. — A company has, as incident to its existence, 

the same power as an individual to compromise claims brought 
against it (y). 

Debentures. Debentures. — The word debenture, though of frequent occur- 

rence in connection with companies, has no definite legal 
meaning (z). What is called a debenture may be a mere pro- 
mise to pay, a covenant to pay under seal, or a mortgage or 
charge under the seal of the company (a). If, as is usually 
the case, it purports to give the holder a charge on the under- 

(s) Mdhony v. East Holyford Dixon's case, L. R. 5 H. L. 618, per 

Mining Co., L. R. 7 H. L. 869. Lord Westbury. 

(t) Ante, p. 191 ; see Cunliffe (z) British India Steam Nav. Co. 

Brooks dc Co. v. Blackburn Building v. Commissioners of Inland Revenue-, 

Soc, 22 Ch. D. 61, and 9 App. Ca. 7 Q. B. D. 165 ; Edmonds v. Blaina 

857. Furnaces Co., 36 Cli. D. 215 ; Levy 

(?t) BcaMe v. Lord Ebury, L. R. v. Abercorris Slate Co., 37 Ch. D. 

7 H. L. 102. 260 ; Topham v. Greenside Fire 

(x) See Looker v. Wrigley, 9 Q. B. Brick Co., 37 Ch. D. 2S1. 

D. 397 ; Chapleo v. Brunswick Build. (a) See cases in last and succeed- 

Soc, 6 Q. B. D. 696. ing notes. 

(y) Bath's case, 8 Ch. D. 334; 

OB 1 i:ai'1>. 197 

taking or 1 1 j « - general property of the company, the charge Bk. II. Chap. 3. 

■ l. 
given is wliiit has been called "a floating security," thai Is, it 

chargee the property of tin- company for the time being, but 

not previ nt the company from dealing with its property 

in the ordinary course of its busineg Consequently, if 

the company, after having issued debentures of this nature, 

mortgages m specific pari of it- property in 1 1 1 « - ordinary course 

of its business, or to obtain an advance of money n< cessary to 

carry on that busin< B8, th< specific m< . whether he had 

notice of the previous issue of d< bentures or uot, lias priority 

over the debenture-hold* < >n the appointment <>f a 

]■■ ceiver by a debenture-holder, or on the commencement of a 

winding-up, the floating nature of the security is at an end, 

and the charge then becomes effective on the property of the 

company existing at that time, hut not as a rule on capital 

which has not been called up (d). 

The validity of debentures given byway of renewal of former 
debentures' or in lieu of bills or bonds of the company pre- 
viously issued, depends on the validity of Buch former instru- 
ments (c). Where power exists to issue debentures they may 
be issued at a discount (/). 

What are called LloycCs Bonds are instruments under the Lloyd's bonds. 
seal of a company, containing an admission by the company of 
its indebtedness to a specified amount to the obligee, and a 
covenant to pay him such amount, with interest, on a future 

(b) See Panama, d-c, Mail Co., 5 priority of debenture-holders inter 
Ch.318 ; Marine Mansions Co., 4 Eq. se, see Cart side v. Silkstone, d-c., Iron 
001 ; New Clydach Go., 6 Eq. 514 ; Co., 21 Ch. D. 762 ; Mowatt v. 
Gardner v. Lond. Chatham and C ', Co., 34 Ch. D. 58. 
Dover Rail., 2 Ch. 201 ; Ex parte (d) Ex parte Bradshaw, 15 Ch. D. 
Moor, 10 Ch. D. 530 ; Moor v. 4G5 ; English Channel Steam Co. v. 
Anglo-Italian Bank, 10 Ch. D. 681 ; Bolt, 17 Ch. D. 715. Compare 
Hodson v. Tea Company, 14 Ch. D. Howard v. Patent Ivory Co., 38 Ch. 
859 ; Ex parte Bradshaw, 15 Ch. D. D. 188. 

405 ; WUlmott v. London Celluloid (e) See Fountaine v. Carmarthen 

Co., 34 Ch. D. 147. Bail. Co., 5 Eq. 316. Compare 

(c) Moor v. Anglo-Italian Bank, Irvine v. Union Bank of Australia, 
10 Ch. D. 681 ; Ex parte Pitman and 2 App. Ca. 366. 

Edwards, 12 Ch. D. 707 ; Wheatley (/) Anglo-Danuhian, dbc, Colliery 

v. Silkstone Coal Co., 29 Ch. D. 715, Co., 20 Eq. 339 ; Campbells case, 4 

:and compare In re Home and Hel- Ch. D. 470. See, also, Regent's Canal 

lard, 29 Ch. D. 736. As to the Ironworks Co., 3 Ch. D. 43. 



Issue of deben- 

Registration of 

under Hills of 
sale act. 

p,k. II. Chap. 3. clay. The validity of these instruments depends on the con- 

— siderations for which they are given ; they are primd facie 

binding on the company as admissions of indebtedness ; but 
when issued by railway companies for money borrowed after 
their statutory powers of borrowing have been exhausted, they 
are altogether illegal and void (g). 

Debentures are issued when they are delivered (h). 
Section 17 of the Bills of sale act, 1882, excepts from the 
operation of that act any debentures issued by any mort- 
gage loan or other incorporated company and secured upon 
the capital, stock, or goods, chattels, and effects of such 

company (?')• 

And as to debenture stock of companies governed by special 
acts of Parliament, see 26 & 27 Vict. c. 118, Part 3 ; and 32 & 
33 Vict. c. 48. 

See further Borrowing Money and Mortgages. 

Deeds. — The deeds of unincorporated companies are governed 
by the principles applicable to ordinary partnerships (k). 

The question, whether an instrument sealed with the seal of 
an incorporated company is binding on the company, depends 
(1) on the authority by which the seal was affixed to the 
instrument, and (2) on the nature of the instrument. An 
instrument to which the seal has been affixed by a person who 
has no authority to affix it, is invalid, and if there is any 
intent to defraud, is a forged instrument (I). On the other 

Deeds of com- 

(g) Chambers v. Manchester, dr., 
Rail. Co., 5 B. & Sm. 588 ; White 
v. Carmarthen Rail. Co., 1 Hem. & 
M. 786 ; Cork and Youghal Rail. 
Co., 4 Ch. 748 ; Fountaine v. Car- 
marthen Rail, Co., 5 Eq. 316-325. 
As to debentures issued for debts 
contracted before tbe power to bor- 
row commenced, see Re Bagnals- 
town and Wexford Rail, Co., Ir. R. 
4 Eq. 505, where the previous autho- 
rities are reviewed. 

(h) Mowatt v. Castle Steel Co., 34 
Ch. D. 58. 

(i) See on this section, Ross v. 
Army and Navy Hotel Co., 34 Ch. D. 
43 ; Edmonds v. Blaina Furnaces 

Co., 36 Ch. D. 215 ; Levy v. Aber- 
corris Slate Co., 37 Ch. D. 260 ; Top- 
ham v. Greenside Fire Brick Co., ib. 
p. 281 ; Jenkinson v. Brandley Mining 
Co., 19 Q. B. D. 568, and as to the 
Bills of Sale Act, 1878, see Swift v. 
Pannell, 24 Ch. D. 210, and Palmer's 
Comp. Prec. 4th ed. pp. 386-388. 

(k) As to the inability of one 
partner to bind his firm by a deed, 
see Partn. 136. 

(I) See Bank of Ireland v. Evans' 
Charities, 5 H. L. C. 389, and per 
Lord Eklon in Mayor of Colchester 
v. Louiev, 1 V. & B. 244 ; Mayor of 
the Staple of England v. Bank of 
England, 21 Q. B. D. 160. 


hand, an instrument sealed by the propei officers is, primd Bk. n. ci 
facie, binding on the bodj corporate; and although the 
Bence of the seal does Dot have the effect of binding the corpo- 
ration with respect to matters which are ultra vires, ii d 
throw upon the corporation the onus of proving the invalidity 
of the instrument, and precludes the corporation from ta] 
advantage of the non-observance of preliminary formalities, it* 
the person dealing with its managers had not aotice of such 
non-observance (m . 

By §55 of the Companies act, L862, any company under 
the act may empower any person to execute <]•>■>]- on its 
behalf in any place not situate in the United Kingdom (n). 

Extension of business. — It follows from the principles inv< - "- ,D of 

• bvusu 

tigated in the last chapter that although the directors of a 

company may develop the business which it was formed to 
transact, they have qo pow< r to chan tharacter of such 

business, nor to enlarge it by embarking in any business not 
necessary to carry on the first in tin- usual way. This sub 
has been already alluded to (o), and will be more fully examin< d 
hereafter when considering th rs of majorities to bind 

minorities, and the cases in which injunctions have been 
granted against directors (p). It is sufficient here to state that 
in conformity with the principles above alluded to, a company 
formed for the purposes of life insurance has been held not 
bound by policies against maritime risks, though issued with 
the sanction of two general meetings Oj) ; that it has been 
doubted whether a copper mining company could sue on a 
contract for the supply of iron by itself (r) ; that a canal com- 
pany has been held unable to obtain by prescription any right 
to water except for the purposes of its canal (s). 

(m) Bateman v. The Mayor of act, 1864, 27 & 28 Vict. c. 19. 

Ashton, 3 H. & N. 323 ; The Aus- (o) See ante, p. 162 et sea. 

tralian, dr., Co. v. Mounsey, 4 K. (p) See book iii. chap. 1, § 3, 

& J. 733 ; The Royal British Bank and chap. 9, § 4. 

v. Turquaiid, 5 E. & B. 248, and (q) Surges and Stock's case, 2 J. & 

6 ib. 327 ; Agar v. The Athenamm H. 441. 

Life Assurance Co., 3 C. B. N. S. (r) Copper Miners' Co. v. Fox, 16 

725 ; Scott v. Colburn, 26 Beav. 276, Q. B. 229. 

and aeea?iie,p. 166 et seq. (s) National Guaranteed Manure 

(n) See also the Companies' Seals Co. v. Donald, 4 E & N. 8. 



Buying share 
in another 

Ek - IL Chap- 3. On the other hand, it is now settled that railway companies 

are bound by contracts to carry or send goods beyond the 

limits of their own lines (t) ; and a railway company can sue 
upon a contract between itself and others who undertake to 
carry passengers and goods from its terminus across the sea 
in steam vessels (u). 

See further in connection with this subject ante, Bill in 
Parliament, and infra, under the heads Leases and Transfer of 

The power of a company formed for lending money, acquiring 
property and carrying on any monetary operations, to join 
other persons in buying an estate and building upon it and 
to form another company in order to carry out the speculation 

London Financial was much discussed in London Financial Assurance v. Kelk (x); 

Keik Ca ° n "' an( ^ ^ was ne ^ ^hat sucn operations were within the power of 
the company ; that any irregularities in the way in which the 
directors had acted had arisen from mere errors of judgment; 
and that what they had done had been approved and sanctioned 
by the bulk of the shareholders. In this case, however, the 
company's memorandum of association was so wide in its terms 
as to warrant almost any kind of business which the directors 
might choose to engage in. 

Indemnity. — A company is not boimd by an indemnity 
given by its directors, unless their power to give it can be 
shown Q/) ; but a general power of management is a sufficient 
authority, if giving an indemnity is fairly within the scope of 
the company's business (z). Nor is a company bound by a 
guarantee given for a fraudulent purpose, and which purpose 
is known to the person to whom the guarantee is given (a). 

Indemnities by 

(t) Willy v. West Cornwall Bail. 
Co., 2 H. & X. 703, and the cases 
there cited ; Great Western Rail. Co. 
v. Blake, 7 H. & N. 987. 

{u) South Wales Rail. Co. v. Red- 
mond, 10 C. B. N. S. 675. Compare 
Col/man v. Eastern Counties Rail. Co., 
10 Beav. 1. 

(») 26 Ch. D. 107. Referred to 
infra, hook iii., c. 2. 

(y) Era Assurance Co., W. N., 1866, 
309 ; Ridley v. Plymouth Grinding 

Co., 2 Ex. 711 ; Kirk v. Bell, 16 Q. 
B. 290 ; and see, as to guaranteeing 
profits to other companies, Colman 
v. Eastern Counties Rail. Co., 10 
Beav. 1. 

(z) Ex parte Booker, 14 Ch. D. 
317 ; Small v. Smith, 10 App. Ca. 
119. • 

(a) British and American Tel. Co. 
v. Albion Bank, L. R. 7 Ex. 119 ; 
Gray v. Lewis, 8 Eq. 526 ; reversed 
hut not on this point, 8 Ch. 1049. 


Aii agreement by directors, that persons taking Bharea in a B ;1 ' 
company shall be indemnified by t li . company against 1 
does not bind the company(6); nor does an agreement that 
the company will indemnify outgoing shareholders againsl their 

liabilities (c). But directors who personally give such in- 
demnities, are hound by them (d). 

Where two companies have power to amalgamate, an agree- 
ment by one of them to indemnify the other against it> liabi- 
lities is valid, and capable of being enforced S further 
as to this subject infra, under tin- head Purchases. 

Insurances. — A life insurance company i> nol hound bylnaorai 
marine policies issued by its directors with the sanction of a 
general meeting of shareholders (/). Nor is a fire insurance 
company, which has power to issue marine policies limiting 
the liability of the company to its funds, hound by marine 
policies issued in a name which is not the name of the 
company, and containing no stipulation as t" the limit of 
liability (g). 

Investments and loans. — Notwithstanding 38 & 30 Vic. c. GO, i 
a loan by a friendly society to a person who i~ not a number 
of the society on the security of his promissory note is not 
illegal but merely unauthorized and the money lent can there- 
fore be recovered (//). 

Judicial Proceedings. — The powers of directors and others to Ju,lici;i1 1'" - 
. . . ceedings. 

act for the company in legal proceedings will be noticed here- 
after when treating of actions (Bk. II., c. 7, and Bk. III., 
c. 9), and winding up (Bk. IV. c. 1). 

Leases. — With respect to leases to and by companies, a Leases, 
company may take on lease a larger house and more land than 
it wants at the time, and may sublet what it does not actually 

(b) See Bunn's case, 2 De G. F. («) Anglo- Australian Ass. Co. v. 
& J. 275. British Prov. Society, 3 Giff. 521 ; 

(c) See Munt's case, 22 Beav. 55, and on app. 4 De G. F. & J. 341. 
and others of that class, which will (/) Phoenix Life Assurance Co., 
he noticed hereafter in hook iii., 2 J. & H. 441. 

ch. 5, § 6. (g) Hambrd' v. Hull and London 

(d) See Barker v. Allan, 5 H. & Fire Ins. Co., 3 H. & N. 789. 

N. 61 ; Haddon v. Ayres, 1 E. & E. (h) In re Coltman, 19 Ch. D. 

118. Compare Ellis v. Colman, 25 .64. 
Beav. 662. 


Bk. II. Chap. 3. require at the time (£). It lias also been held that the directors. 
- — — — - of an hotel company might lease part of the hotel for the 
purposes of a government office (k) ; but in this case the 
circumstances were peculiar ; the hotel was of an immense 
size and just finished ; the letting was to be temporary ; and 
the whole building could not have been advantageously opened 
as an hotel at once. It is settled that in the absence of 
express power so to do, one railway company cannot lease its 
line to another and exclude itself from using it (I). Where, 
however, the articles of association of a company authorised 
two-thirds of the shareholders to require the directors to do 
any act which the company itself could do, and two-thirds of 
the shareholders authorised and required the directors to lease 
the company's works for twenty-one years, and such lease was 
made accordingly, it was held to be valid and binding on the 
company and on dissentient members (m). 

It has been decided that a railway company cannot make 
a valid lease of any part of its land, so as to prevent the 
company from retaking the land if and when possession of 
the land becomes necessary for the purposes of the com- 
pany (n). But this doctrine is not to be extended to cases in 
which it is not clearly proved that the lease is inconsistent 
with the attainment by the company of the purposes for which 
it was created (o). 
Mortgages and Mortgages and Pledges. — With respect to mortgages and 
p ° c ; pledges by companies little remains to be added to what has 

been said above under the head Borrowing money. It has 
been held that a trading company can give a valid bill of sale 

(t) See Horsey s claim, 5 Eq. 562. 6 H. L. C. 113. See further, as 

(fe) Simpson v. Westminster Palace to this much litigated case, 2 Mac. 

Hotel Co., 2 De G. F. & J. 141, and & G. 324 ; 3 ib. 70 ; 16 Beav. 441 ; 

8 H. L. C. 712. See, also, Forrest 4 De G. M. & G. 115 ; 17 Q. B. 652. 

v. Manchester and Sheffield Rail. Co., (m) Featherstonhaugh v. Lee Moor 

30 Beav. 40, and 7 Jur. N. S. 887, Porcelain Clay Co., 1 Eq. 318. 

as to temporary use of property. (n) Mulliner v. Midland Rail. Co. r 

(I) See Winch v. Birkenhead Rail. 11 Ch. D. 611. Qu., if this case did 

Co., 5 De G. & Sm. 562 ; London not go too far. 

and Brighton Rail. Co. v. London (o) See Grand Junction Canal Co. 

and S.-W. Rail. Co., 4 De G. & J. v. Petty, 21 Q. B. D. 273, where part 

362 ; Shrewsbury and Birmingham of a towing path was dedicated to- 

Rail, Co. v. North-Western Rail. Co., the public as a highway. 


I cure a debt of the company (p) ; that the directors of a 
Bteam ship company having general | of management - 

cau mortgage its Bhipa for money borrowed (q), and that the 
directors of a manufacturing company with similar pov. 
can equitably mortgage it- property by depositing its deeds (r); 
but tliut a mortgage of the uncalled-up capital of a company is 
invalid unless ander special circumstanci - 

\ to mortgages by companies governed by the Compani 
clauses consolidation act, see ante, under the head Borrowing 
money, and al 9 Vict. c. 16, § 88 et seq., and as to deben- 

ture stock, 26 & -11 Vict. c. 118, § 22 et seq., 82 & 38 Vict, 
c. 48, § 1. 

All limited registered companies are required by the Com- & 
pames act, 18G2, to keep a register of all mortgages and 
charges specifically affecting their property and to allow the 
register to be inspected (t); but unregistered mortgages are 
not invalid, even although held by a director whose duty it i^ 
to see that the statute is complied with (m). 

By section 19 of the Stannaries art, 1887 (50 & 51 Vict, 
c. 43), all companies to which that act applies are required (in 
addition to any other registration required by law) to register 
;it the office of the registrar of the vice-warden's court within 
twenty-eight days of their date, all documents whereby power 
is given to any person to take possession of any mining effects 
of or in their mine. Unless registered the documents shall 
confer no priority over, or title as against, the claims of an}' 

(p) Shears v. Jacob, L. B. 1 C. P. (t) 25 & 26 Vict. c. 89, § 43. 
513 ; Deffell v. Jlltite, L. R. 2 C. P. (tt) Wright v. Horton, 12 App. 
144. A bill of sale given by a com- Ca. 371, which finally settles this 
pany is within the Bills of Sale act, much - contested question. The 
1882 (45 & 46 Vict. c. 43), unless it earlier authorities are, General South 
is a debenture within the meaning American Co., 2 Ch. D. 337; Bo- 
ol section 17 of that act. See At- rough of Hackney Newspaper Co., 
tenborough's case, 28 Ch. D. 682, and 3 Ch. D. 669 ; North and South 
ante, p. 196. Wales Bank, 10 Eq. 515 ; Dublin 

(q) Australian Steam Clipper Co. Drapery Co., 13 L. E. Ir. 174. Com- 

v. Mounsey, 4 K. & J. 733. pare Native Iron Ore Co., 2 Ch. D. 

(?•) Ex parte National Bank, 14 345 ; Ex parte Valpy and Chaplin, 

Eq. 507 ; Patent File Co., 6 Ch. 83. 7 Ch. 289, where the mortgages were- 

(s) See ante, p. 192, (I) and p. 197 held invalid. 



Mortgage De- 
benture Act. 

Bk. II. Chap. 3. persons for work done in the mine or for goods supplied to the 

Sect. 1. . ... 

■ — - — - company by which the mine is carried on. 

By the Mortgage debenture act, 1865 (28 & 29 Vict. c. 78, 
amended by 33 & 34 Yict. c. 20) (x), facilities are given for the 
issue, by certain classes of companies, of transferable mortgage 
debentures, upon certain terms and conditions. But the act 
only applies to, 1, companies governed by the Companies 
act, 1862, and restricted by the memoranda of association to 
the objects of advancing money on real securities, and of 
borrowing money on transferable mortgage debentures, or on 
real securities (y) ; 2, to companies incorporated by act of 
Parliament for similarly restricted purposes. Moreover the 
paid-up capitals of these companies must not be less than 
100,000L, and each share must be of the nominal value of not 
less than 50Z., of which not less than one-tenth nor more than 
one-half must have been paid up. 

Notice. — From the principle that the individual shareholders, 
and even the individual directors of a company are not its 
agents (z), it follows that notice to one of them is not notice 
to the company (a) ; and a company is not deemed to have 
notice through a director of a fraud on the company com- 
mitted by that director (b) ; nor are two companies having 
some directors in common necessarily affected through them 
with notice of each other's affairs (c). Thus where two com- 
panies, A. and B., had in common two directors and a solicitor, 
and company A., in order to buy up its own shares, borrowed 
money of company B., and this circumstance was known to 
one of the two directors and to the solicitor, it was neverthe- 
less held that company B. had no notice of the impropriety of 

Notice to com- 
panies, &c. 

(sc) The act contains a great va- 
riety of important provisions, to 
which it is unnecessary to allude in 
the present place. 

(y) There is power to alter the 
memorandum so as to restrict it to 
these objects where the memorandum 
as originally framed includes them, 
but extends to others as well. See § 3. 

(z) Ante, p. 155 et seq. 

(a) See Powles v. Page, 3 C. B. 

16 ; Re Carew's Estate Act (No. 2), 
31 Beav. 39 ; Peruvian Rail. Co. 
v. Thames, &c., Insurance Co., 2 Ch. 

(b) Oriental Commercial Bank, 5 
Ch. 358 ; Re Car eld's Estate Act, 
(No. 2)-, 31 Beav. 39. 

(c) Credit Fonder, &c, Co., 1 Ch. 
161 ; Ebbw Vale Co.'s claim, 8 Eq. 


the transaction (rf). At the same time if, as sometimes Bk - JI - C 1 
happens, one director lias authority to act for ;i company, his 
knowledge of matters within the scope of his authority affects 
the company; and it may be said generally that a company is 
affected by the knowledge acquired by its agents in the course 
of their duty (e), and as to matters to which it is their duty to 
attend, bu1 not to other matters (/). 

Although every person has notice of what he himself doi 
a company is not affected with notice of what is done by its 
officers when acting for themselves and not for the com- 
pany (ij), nor when acting in fraud of the company or beyond 
their powers (//). 

Purchases. — Companies are clearly liable for goods supplied Purchases, 
to them for the purpose of carrying on their business, if 
ordered by their agents. It has been held that the members 
of a cost-book mining company are liable for goods supplied 
to the mine by the order of its/lirectors or resident manager (?'); 
and that an ordinary joint-stock company cannot escape 
liability for goods bon<i fide supplied to it for the purposes of 
its business, and by the order of the superintendent of its 
works, simply because he may not have been appointed in 
strict conformity with the company's deed of settlement (/.). 

(d) Credit Fonda; etc, Co., 7 Ch. Drew. 635 ; Willes v. Greenhill, 29 

161. See, also, Gray v. Lewis, 8 Ch. Beav. 376 and 387. 

1035, reversing S. C. 8 Eq. 526. (/<) See in addition to the cases 

(c) Societe Generate de Paris v. in note (b), Partn. 142, and Banque 

Tramways Union Co., 14 Q. B. D. Jacques Cartier v. La Banque, &c, 

424, and 11 App. Ca. 20, sub nom. de Montreal, 13 App. Ca. Ill ; IVil- 

Societe Gen., dec. v. Walker, where liamson v. Barbour, 9 Ch. D. 535 ; 

the knowledge was acquired from Lacey v. Hill, 4 Ch. D. 537, and 

casual talk at a funeral. As to ante, p. 178 et seq. 

notice through clerks, see the cases (i) Newton v. Daly, 1 Fos. & Fin. 

in note (h). 26 ; Tredwen v. Bourne, 6 M. & W. 

(/) British and American Tel. Co. 461 ; Hawken v. Bourne, 8 ib. 703. 

v. Albion Bank, L. R. 7 Ex. 119. As to Vice v. Anson, 7 B. & C. 409, 

See, also, Styles v. Cardiff' Steam- see the above cases, and Owen v. Van 

boat Co., 4 N. R. 483, Q. B. ; a case Uster, 10 C. B. 31S. 

as to notice of ferocity of a dog. (A-) Smith v. Hull Glass Co., 1 1 

(g) See the cases on reputed C. B. 897 ; Allard v. Bourne, 15 

ownership, Ex farte Boulton, 1 De C. B. N. S. 46S. 
G. & J. 163 ; Browne v. Savage, 4 


Ek. II. Chap. 3. s a company is liable to pay for goods which it has power to 
buy, and which have been ordered in its name b} T its agents, 
although not for its use (I). But the mere circumstance that 
goods have been supplied to a company in the course of its 
trade and have been used by it, is not sufficient to render the 
company liable for them if they were supplied by the order of 
persons not authorised to obtain them for the company (m). 
In such a case ratification by the company must be proved (n). 
A company has implied power to purchase a patent which is 
useful to it for the purpose of carrying on its business (o). 

Whether a company can buy shares in another company 
depends on the objects with which it is formed (_p). But a 
company has no implied power to buy its own shares, nor is 
such a power included in a general power to deal in shares (q). 
In fact, such a power is inconsistent with the whole principle 
of limited companies, and cannot be conferred on such a 
company even by its articles of association, nor is it conceived 
even by its memorandum of association (r). 

Representations. Representations. — A joint stock company is not bound by 
the statements of one of its members, unless he is also the 
agent of the company, and his statements relate to matters 
within the scope of his agency (s), and are made by him when 
acting for the company in some business with a third party (t). 
Nor is a company bound b} T statements made by one of its 
directors, if he is not singly an agent of the company (u). 
But a company is bound by the statements of its directors, if 

(l) Ebbw Vale Go's claim, 8 Eq. 14. association would he void — and the 

(m) Kingsbridge Flour Mill Co. v. writer is of the same opinion. This 

Plymouth Grinding Co., 2 Ex. 718. point, however, did not actually 

(n) As to which, see ante, p. 178 arise, and has not been directly 

et seq. 


(o) Leif child's case, 1 Eq. 231. (s) Burnes v. Pennell, 2 H. L. C. 

(p) Ante, pp. 43, 200. 497, ante, p. 154 ; Burnett Hoares £• 

(q) Zulueta's claim, 5 Ch. 444. Co. v. South London Tramways Co., 

(r) See Trevor v. Whitworth, 12 18 Q. B. D. 815. 

App. Ca. 409, where the earlier (t) Devala Provident Gold Mining 

cases are collected and discussed. Co., 22 Ch. D. 593. 

Lord Macnaghten (p. 436) was of («) Holt's case, 22 Beav. 48 ; Gib- 

opinion that the power even if son's case, 2 De G. & J. 275 ; Nicols 

contained in the memorandum of case, 3 De G. & J. 387. 

• l r.\ 0L1 [NQ any TOUT OB PBAUD. 2 7 

made \>\ them honesth for the company and in the coursi 
the business which it ie their duty to transact 

A r< [ards representations respecting the credit of p 
these to be actionabL must be in writinj I by the persons, 

making them I. c. 1 1. . 6). Signature bj an agent U 

not enough, and it has been held thai a banking company 
governed b} 7 Geo. !. c. 16, is no! liable to be Bued for a 
misrepri sentation of the kind in question mini-- by its mana{ 
although signed by him 

II. >w far companies are liable for the false and frauduL 
statements of their directors and other officers will be examined 
in a subsequent Bection of the present chapter. 

See furthi r on this Bubjecl ante, under the head Admissions. 

Suits. \\ itli respect t<> sales by companies, tin- main points Sale* '. 

to be borne m mmd are : — 

1. Corporate bodii s have by common law lull power t < > sell 
their own corporate property (z). 

2. Railway and other companies governed bj Bpecial acts 
Parliament conferring upon them rights and privileges which 
tiny would not otherwise enjoy, cannot delegate or transfer 
those rights ami privileges to other persons 

3. Although general powers of management necessarily in- 
clude power to sell in the ordinary course of business, Buch 
powers do not authorise ^ale> of an unusual description, e.g., a 
sale of the business of the company (o). 

But there is a distinction between selling the business of a 
company as a whole and selling the specifie goods and chattels 
of the company. This is well illustrated by the case of 
Wilson v. Miers (c). There a steamship company, being the Wilson v. Mien?. 

(x) See the cases cited in § 3. (a) See Winch v. Birkenhead 

Mux's Ex. case, 2 De G. M. & G. Bail. Co., 5 De G. & Sm. 562, and 

522. other cases of that class, ante, p. 202, 

(?/) Swift x. Jewsbury, L. R. 9 note (I). 

Q. B. 301, overruling 8 Q. B. 244. (b) See Ernest v. Nicholls, 6 H. 

Compare Bancick v. English Joint L. C. 401 ; Ex parte Liquidators of 

Stock Bank, 2 Ex. 259. the British Nation, dec, Ass., 8 Oh. D. 

(z) Mayor, <£-c., of Colchester v. 679, and the cases cited ante, p. 184 

Lowten, 1 V. & B. 226 ; Evan v. note (/). See, also, Chappie v. Cadell, 

Corporation of Avon, 29 Beav. 144. Jac. 537, infra, nott- (e). 

See, also, Patent File Co., 6 Ch. 83. (c) 10 C. B. N. S. 348. 



Bk. II. Chap. 3. reverse of prosperous, its directors entered into a contract for 
Sect. 2. . 

— the sale of its whole fleet. The purchaser declined to com- 
plete the contract, on the ground that, although the directors 
had general powers of management, including power to buy 
and sell ships, they could not, in the absence of a resolution to 
dissolve the company, sell off all its ships at once. The Court 
of Common Pleas, however, held that the contract was one 
which the directors could lawfully enter into and carry out 
without any special authority from the shareholders. 

4. A power to sell the assets of a company as a whole when 
it is being wound up is conferred by the Companies act, 
1862 (d) ; and independently of that act, where there is power 
to wind up, there must necessarily be a power to sell and con- 
vert into money (e). 

See further ante, Amalgamation. 
Transfer of Transfer of business, see ante, Amalgamation, and Sales. 


Negligence of 


Although companies are never created to do what is wrong, 
and can seldom be said to have in fact authorised the wrongful 
acts of their directors or servants, it is plain that the ordinary 
principles of agency apply to such cases; and on these 
principles, companies are liable for the negligence of their 
servants, and for torts committed by them in the course of their 
employment ; and it never has been admitted, as a sufficient 
reason for non-liability on the part of the company, that it did 
not in fact authorise the very act complained of. All that is 
necessary to charge the company is that the act complained of 

(d) See § 161, and Higg's case, 2 
Hem. & M. 657 ; Clinch v. Financial 
Corp., 5 Eq. 450, and 4 Ch. 117 ; 
Imperial Bank of China, &c. v. 
Bank of Hindustan, 6 Eq. 91 ; City 
and County Investment Co., 13 Ch. 
D. 475 ; and Union Bank of Kings- 

ton-upon-Hull, ib. p. 80S. 

(e) See Lord v. Copper Miners' 
Co., 2 Ph. 740. Compare Cliapple 
v. Cadell, Jac. 537, where it was held 
that the majority of the proprietors 
of a newspaper could only sell their 
own shares. 



should be intra vires, and not idtra vires (/), and Bhould be Bk - n - CIia i ) - 3 - 

I 2. 

committed by the agent or servant of the company in tin* course - 
of the business to which it is his duty to attend, or as it is 
Bometimes expressed, in the course and ae pari of his employ- 
ment^). Upon this principle it hae been held thai the Bank 
of England is liable for a wrongful detention of hank notes by 
its servants (h) ; that a banking company is liable for the loss 
of securities entrusted to it and carelessly kept(t); that a com- 
pany is liable for a wrongful Beizure of goods made by its 
servants for aon-paymenl of tolls (ft) ; for wrongful assaults (Q, 
and arrests if made by persons authorised to act for tin- com- 
pany in removing persons or 'jiving them into custody (m); for 
negligence in laving down gas-pipes («) ; for reckless driving (o); 
for the infringement of a patent by its servants contrary to the 
orders of its directors (/>) ; and for the publication of a libel by 
transmitting it by telegraph (g). /Moreover, in such cases as 

(/) See cmte f p. 161, d eeq, and 
Poulton v. L. it S.-W. Bail Co., L. 
R. 2 Q. B. 534. 

(g) See, on this subject generally, 
Burnsy.Poul8om ) h.'R.8C. P. 563, and 

the cases cited infra ; with reference 

to arrests, Lord Bolingbroke v. Local 
Board of Swindon, L. R. 9 C. P. 7"' , 
Mersey Docks Co. v. Gibbs, L. R. 1 
H. L. 93 ; Coe v. Wise, ib. 1 Q. B. 
711 ; and as to the non-liability of 
companies for the acts of directors 
and agents when not acting as their 
agents, British Mutual Banking Co. 
v. Charmoood Forest Rail. Co., 18 Q. 
B. D. 714 ; McGowan db Co. v. Dyer, 
L. R. 8 Q. B. 141. 

(h) Yarborough v. Bank of Eng- 
land, 16 East, 6. See, too, Giles v. 
Taff Vale Rail Co., 2 E. & B. 822. 

(i) Johnston's claim, 6 Ch. 212. 
Compare Ciblin v. McMulUn, L. R. 
2 P. C. 317. 

(k) Ma-undv. Monmouthshire Canal 
Co., 4 Man. & Gr. 452 ; Smith v. 
Birmingham Gas Co., 1 A. & E. 526. 

(I) Butler v. Manchester and Shef- 
field Rail. Co., 21 Q. B. D. 207. 


Co., L. R. 8 Q. B. 'nj v. 

"a' 1 >7< '. Co., 

L. R. 8 0. P. 148 ; Goff v. G. 
Northern I . 3 E. & E. 672. 

Compare / v. London and 

X.-ll'. Bail. Go., L. R. 5 C. P. 445; 
Allen v. London and S.-W. Rail. Co., 
L. R. 6 Q. B. 65 ; Poulton v. London 
and S.-W. Rail. Co., L. R. 2 Q. B. 
534, and Eastern Counties Rail. Co. 
v. Broom, 6 Ex. 314, in all of which 
the company was held not liable. 

(n) Scott v. Mayor of Manchester, 
1 H. & N. 59, and 2 ib. 204. 

(o) Green v. London General Om- 
nibus Co., 7 C. B. N. S. 290; 
Limpus v. Same, 1 Hurlst. & C. 

(p) See Betts v. De Vitre, 3 Ch. 

( q) Whitfield v. So u th-E astern Rail. 
Co., E. B. & E. 115. See, further, 
as to libels by companies, Lawless v. 
Anglo-Egyptian, &c, Co., L. R. 4 Q. 
B. 262, where the libel complained 
of was contained in a report made by 
the directors to the shareholders 



Bk. II. Chap. 3. those now in question, it is not necessary, in order to fasten 

Sect. 2. * J . 

— — liability on the company to prove any formal appointment of 
the agent by the company (r). 
Malicious Whether an action will lie against a corporate body for a 

malicious injury has been much discussed and doubted, and can 
scarcely be said to be yet settled (s). The weight of authority is 
however in favour of such an action being maintainable, and in 
the author's opinion this is most in accordance with principle (t). 
It is, however, essential in order that a company ma}' be 
liable for the wrongful acts of its servants that those acts should 
be such as the company could have authorised, and that they 
should have been authorised or ratified by the company, or 
have been done by the servants in the course of their employ- 
ment, and not when acting in matters to which it is not their 
duty to attend (u). Accordingly it was held that a company 
was not liable for injuries committed by a dog kept in a yard, 
there being no evidence to show that the savage nature of the 
dog was known to any one who had charge of it, nor to the com- 
pany's manager, nor, in fact, to any one whose knowledge could 
be considered as the knowledge of the company, although it was 
proved to be known to one or two of its servants (x). 

and which was held to be a privi- expressed a decided opinion against 

leged communication. such an action. As to maintenance 

(r) See Giles v. Tuff Vale Rail. Co., and champerty, see Metropolitan 

2 E. & B. 822. Bank v. Pooley, 10 App. Ca. 210. 

(s) An action for malicious prose- (t) Pollock on Torts, 51 & 81. 

cution was held to lie in Edwards v. (u) See the cases in the last ten 

Midland Rail. Co., 6 Q. B. D. 287 ; notes, and the judgment in Bank of 

and the possibility of its being New South Wales v. Owston, 4 App. 

sustainable was recognised by the Ca. 270. The cases cited in note (m) 

Privy Council in Bank of New South show that a company can ratify and 

Wales v. Owston, 4 App. Ca. 270. adopt the torts of its agents, if those 

See, however, contra, Stevens v. Mid- torts are such as can theoretically 

land Counties Rail. Co., 10 Ex. 352, be imputed to the company, 

and Abrath v. N.-E. Rail. Co., 11 (x) Styles v. Cardiff Steam Boat Co., 

App. Ca. 247, where Lord Bramwell 4 N. K. 483, Q. B. 


Hk. II. C\ 

Ii la now proposed to examine the general question — Under ?n 
wlint circumstanci -. is a fraud perpetrated by the directors of a 
company imputable to the company? 

Directors of a company have no Implied authority from the 
company t" make false representations on it- behalf; and, 
generally speaking, frauds committed bj directors are quit 
much frauds tui the companies th< y represent as on othi 1 per- 
sons. But consistently with the established principli acy, 
it doea aol ("How that, as between an innoc< n1 company on the 
one hand, and an innocent individual defrauded by its directors 
on the other, the company is no1 reponsible for the fraud com- 
mitted by the directors. It has been held that the general 
interests of society demand that the representations by the 
directors of a company Bhall bind the company, although the 
shareholdi rs may be ignorant of the r< pm sentations and of 
their falsehood (y). In practice this question never arises in 
an abstracl form, but always with reference to Borne remedy 
sought either by the company or againsi it ; and if against it, 
then with reference to the rescission oi some contract or with 
reference to an action for damages. This must always be borne 
in mind in reading the reported cases on the subject; for 
observations true with reference to one class of remedies may 
be inapplicable to another class (z). 

First it will be convenient to refer to cases in which com- 1. Rescission 
panies have sought redress, and to cases in which relief by way 
of rescission of contract has been sought against them. 

In The National Exchange Company of Glasgow v. Drew (a), National Ex- 
the defendants had been induced, by the false statements con- { (jwowtt, 
tained in the reports of the directors to the shareholders of a Drew - 
company, and by the false representations of its manager, to 
borrow money of the company, and to buy shares in it with 

(y) See the cases cited below. ments in this case were reviewed by 

(2) See in addition to the cases in Lord Chelmsford in Nicol's case, 3 

the text, TFestem Bank of Scotland v. De G. & J. 387, and were not alto- 

Addie, L. R, 1 H. L. Sc. App. 145 ; gether approved by him. See, how- 

Banger v. The Great Western Bail. ever, the judgment of Lord Justice 

Co., 5 H. L. C. 72. Turner in the same case. 

(a) 2 McQueen, 103. The judg- 

P 2 


Bk. II. Chap. 3. the money so borrowed, in order to keep the price of shares up 
- in the market. The company sued for a return of the money 
lent, and the defendants relied upon fraud as an answer to the 
suit. The fraud was clearly proved, and it was held imputable 
to the company, and a sufficient ground of defence. The 
following passage from the judgment of the Lord Chancellor 
shows how the argument, that the fraud committed was not 
the fraud of the company, was met. 

Judgment of "The company, as an abstract thing, can represent or do nothing. It can 

Lord Cranworth. on ]y ac ^ ^y j^ s managers. When, therefore, the directors, in the discharge 
of their duty, fraudulently (for I assume this to be so), for the purpose of 
misleading others as to the state of the concerns of the company, represent 
the company to be in a different state from that which they know it to be, 
and the persons to whom the representation is addressed act upon it in the 
belief that it is true, I cannot think that society can go on without treating 
that as a misrepresentation by the company. Otherwise companies of this 
sort would be in this extraordinary predicament — that they might employ, 
nay, must employ, agents to carry on their concerns, and that those agents 
might make representations, be they ever so false and ever so fraudulent, 
and yet that the company might and must benefit by those misrepresenta- 
tions, without being at all liable to be told, that is your fraud. It waa 
plausibly argued that these reports were not made by the company but to 
the company. In form that is so. No doubt they are reports made to the 
company. But I assume, for the present, that they were made to the 
company under such circumstances that what they so report is known and 
intended to be known, not only to the shareholders, but to all persons who 
may be minded to become shareholders, just the same as if they were pub- 
lished to the world. I repeat that I think the exigencies of society demand 
that the reports so made and so circulated should be deemed to be the 
Judgment of reports of the company." Lord St. Leonards expressed a similar view upon 
Lord St. Leo- ^g question. He said, " If representations are made by a company fraudu- 
lently, for the purpose of enhancing the value of their stock, and they 
induce a third person to purchase stock, those representations so made by 
them for that purpose do bind the company. I consider representations by 
the directors of a company as representations by the company, although 
they may be representations made to the company ; it is their own repre- 
sentation. What is the first act which takes place at any such meeting as 
^hat at which the report was read ? The first act which takes place at every 
such meeting in Scotland and England is, that if there is not a rejection, 
there is an adoption of the report ; then I say the report is the act of the 
company, and not simply of the directors. It does not stand as the simple 
statement of the directors. It becomes the act of the company by the 
adoption of the report, and sending it forth to the world as a true repre- 
sentation of their affair?, and if that representation is made use of in 
dealing with third persons for the benefit of the company, it subjects them 
to the loss which may accrue to the party who deals, trusting to those 



Again in New Brunswick Co. v. Conybeare (b), the facts 1;k - n - r],:i v ■'■'■■ 
of which will be referred to hereafter in considering the sub- 

New Brunswick 
ject oJ the rescission of contracts for fraud, Lord Westbuiy, company v. 

naif] • Conj 

•• 1 1 1 rtainly am not a1 all I to advise your lordships to throw any Judgment of 

doubt upon this doctrine, that if report* are made to the .-!. of a L ' J1 ' 1 ™« 8 ** mi y« 

company by the directors, and the reports are adopted by the Bharehol 
at one of the appointed meetings of the company, and tb - are 

afterwards inilu.-tiiuu.~ly circulated (c), undoubtedly representations con- 
tained in those reports must be taken, after their adoption, to be represen- 
tations ami statements made with the authority of the company, and th 
fore binding the company. Neither do I think it would beat all expedient 
to question this conclusion — that if those reports, having been industriously 
circulated, shall be clearly shown to have been the proximate and immediate 
of shares having been bought from the company by any individual-, 
or subscribed for by any individuals, undoubtedly it will be impossible, 
consistently with the principles of equity, to permit the company to retain 
the benefit of that contract, and to keep the purchase money that has been 
bo paid. There may be a very different consideration applied tu the same Difference 
transaction in a court of Law and in a court of equity; because when an .^j^.'uit'v* 
attempt is made in a court of law to render a party liable in damagi 
certain consequences of a misrepresentation, it is necessary to prove that 
the individual was aware, at the time, of the falsehood of the representation, 
or ought to have been bo aware ; but with regard to a claim for the i 
tution of property acquired through : tations made 1 

individual acting in the capacity of agent, although the company 
no parties to those representations, and did not distinctly authorise them, 
it would still appear to be inconsistent with natural justice to permit 
property acquired by the company through the medium of those repre- 
sentations to be ret lined by them. So far, therefore, as these report- 
concerned, they must be taken, I think, to be representations made by 
the company " (d). 

Lord Cranworth expressed it as his opinion " That if an incorporated Judgment of 
company, acting by an agent, induces a person to enter into a contract for Lord Cranworth. 
the benefit of the company, that company can no more repudiate the 
fraudulent agent than an individual could repudiate him, and that conse- 
quently the company are bound by the misrepresentations of their agent : " 
and after alluding to the opinion he had expressed in the National Exchange 
Company v. Drew, and which is given above, bis lordship added— 

" To that opinion I entirely adhere, and I think it would have been 

(b) 9 H. L. C. 711. (d) See, in illustration of this 

(c) A report by the directors to doctrine, Lovell v. Hicks, 2 Y. & C. 
the shareholders is not industriously Ex. 46 and 481 ; Slim v. Croucher, 1 
circulated by being sent to absent De G. F. & J. 518 ; Smith v. Reese 
shareholders, Ex parte Barrett, 2 Dr. River Co., 2 Eq. 264 ; 2 Ch. 604, and 
& Sm. 415. L. R. 4 H. L. 64. 




II. Chap. 
Sect. 3. 

applicable in this case if it had been proved that there had been a fraudu- 
lent representation or concealment by the directors, in order to induce 
Mr. Conybeare to purchase, not shares in the market (that is a very 
different thing), but shares belonging to the company ; namely, forfeited 
shares. If the directors, or the secretary acting for them, had fraudulently 
represented something to him which was untrue, I then adhere to the 
opinion which I expressed in the former cases, that the company would 
have been bound by that fraud. But the principle cannot be carried to 
the wild length that I have heard suggested, namely, that you can bring 
an action against the company upon the ground of deceit, because the 
directors have done an act which might render them liable to such an 
action. That I take not to be the law of the land, nor do I believe that it 
would be the law of the land if the directors were the agents of some 
person, not a company. The fraud must be a fraud that is either personal 
on the part of the individual making it, or some fraud which another 
person has impliedly authorised him to be guilty of." 


applicable to 
these cases. 

Distinction be- 
tween reports 
of directors and 
reports of share- 

The principles above laid down have indeed been ques- 
tioned (c) ; but so long as it is law that a principal may be 
bound by the unauthorised act of his agent, so long it will be 
impossible to deny that companies may be affected by the false 
and fraudulent representations of their directors, although they 
have no authority to promulgate falsehoods. The falsehood 
may be an excess of authority, but it does not therefore follow 
that it is imputable only to those who utter it : and it is now 
settled that 'for all purposes of rescission of contract induced by 
a false and fraudulent statement made by an agent of a com- 
pany, such statement is, in point of law, the statement of the 
company, if the statement relates to a matter as to which he is 
its agent (/), and if it is made in the course, and as part of 
the business which he is appointed to transact for the com- 
pany (g). Moreover in such cases there is no difference in prin- 
ciple between a fraudulent misstatement and a fraudulent con- 
cealment of a material fact (Ji). 

A distinction is sometimes drawn between false reports made 
by directors to the shareholders, and adopted by them and 

(e) See NicoFs case, 3 De G. & J. 
387 ; Mixer's case, 4t ib. 575 ; Ex 
parte Barrett, 2 Dr. & Sm. 415. 

(/) See the cases of rescission of 
contracts to take shares, ante, book 
L, c. 3, as well as the authorities re- 
ferred to in the present section. 

(g) As to this qualification, see the 
cases infra, p. 216. 

(h) See Peek v. Gurney, 13 Eq. 79, 
and L. E. 6 H. L. 377 ; Harwich v. 
English Jt. Stock Bank, L. R. 2 Ex. 
259 ; and Oakes v. Turquand, L. R, 
2 H. L. 325. 


then laid before the public, and false statements made by the Ck. II. Chap, .3. 

directors alone to persons making enquiries of them with refer- 

ence to the affairs of the company. But if such statements as 

the last cannot bind the company, it is difficult to see on what 
principle untrue reports adopted by shareholders can be 
regarded as emanating from those shareholders who do not 
expressly adopt them. If the directors are not the agents of 
the body of shareholders, for the purpose of stating what is 
false, surely some of the shareholders are not the agents of the 
rest for the same purpose. To say that a falsehood emanating 
from the directors is not imputable to the company, but that a 
falsehood emanating from a meeting of the shareholders is im- 
putable to the company, cannot be right. The same principles 
ought to be applied to both cases ; and the distinction between 
representations made by shareholders and similar representa- 
tions made by directors is only sound when the representations 
relate to matters which the shareholders are competent to deal 
with, but the directors are not. 

It must not be concluded from the foregoing observations Reports and cir- 

. ... , culars when not 

that circulars and reports issued by a company are to be imputable to 

regarded as representations by the company to any one who com P an y- 
sees them and is induced, even by an officer of the company, 
to act upon them. They will not amount to representations 
by the company unless they were issued for the purpose for 
which they are afterwards used ; nor unless used by some 
person whose business it is to carry out that purpose ; nor 
unless used by him when acting on behalf of the company. 
This is well illustrated by Bunies v. Pennell (/), which is some- Bumes v. 
times, but erroneously, supposed to have decided that false 
reports made by the directors to their shareholders, and after- 
wards laid before the public, are not to be regarded as repre- 
sentations by the compan}\ In this case a company was paying 
dividends when it was not warranted in doing so ; its directors 
had issued and published false reports as to the flourishing 
state of its affairs ; some time after these reports had been 

(i) 2 H. L. C. 497. See, too, case, 4 Drew. 529 ; and see Peek v. 
Nicol's case, 3 De G. & J. 387 ; Gumey, L. E. 6 H. L. 377, which, 
Bigge's case, 5 Jur. N. S. 7 ; Worth's however, was an action for damages. 


Bk. II. Chap. 3. published, and when in fact they were old, they were shown by 
— the law agent of the company to a person who was desirous of 
taking shares in it, and who ultimately did take shares in it on 
the faith of the representations made to him by the law agent, 
backed by the reports in question. It was held that these cir- 
cumstances afforded no answer to an action for calls. It was 
no part of the business of the law agent to induce people to 
take shares in the company ; no part of his business to make 
any representations as to the affairs of the company. The case 
is an authority for the proposition that representations made 
by an unauthorised person, although an officer of the company, 
do not bind the company, and that reports of the company 
used by him to substantiate his statements are not to be re- 
garded as representations made by the company to the person 
to whom he shows them. But the case is no authority for the 
proposition that reports of directors are not reports of the com- 
pany upon whose affairs it is part of their business to report. 
Whether any person who sees them is entitled to make use of 
them against the company is quite a different matter. He is 
only entitled to do so in one of two cases, viz., 1, if the reports 
are published for the purpose of being acted upon by the public, 
and he as one of the public deals with the company upon the 
faith of them ; or, 2, if, being used for the purposes for which 
they were published, they are so used by the agents of the 
company when acting within the limits of their real or apparent 
authority and on behalf of the company. 

Numerous other cases illustrating these principles will be 
found in the chapter relating to membership induced by false 
statements (Bk. I. c. 3, ante, p. 68, et seq). 
2. Actions for Passing now to actions for damages, the question whether a 

corporate body can commit a fraud and be liable in damages for 
it, at once presents itself for consideration. Some eminent 
judges are of opinion that an action of deceit will not lie against 
a corporation (k) ; but the contrary has been decided more than 

(k) See Lord Bramwell's judgment 166. See the comments on the dicta 

in Abrath v. N.-E. Bail. Co., 11 in this case in Mackay v. Commercial 

App. Ca. 352; and per Lords Bank, L. R. 5 P. C. 413; and Houlds- 

Chelmsford and Cranworth in worth v. City of Glasgow Bank, L. R. 

Addie v. Western Bank of Scotland, 5 App. Ca. 317. 
L. E. 1 Sc. & Div. App., pp. 158, 


once, both by the Privy Council and by the Exchequer *■ u « Cba P- 8 - 

In Barwick v. English Joint Stock Bank (I), an incorporated Barwick v. 
banking company was held liable in damages for a false and Stock Bank. 
fraudulent statement of its manager relating to the state of a 
customer's account with the bank. 

In Mackay v. Commercial Bank of New Brunswick (m) the Mackay v. 

i t> 11 3 , i i • .. . Commercial 

above case was followed, and a banking corporation was again Bank of New 
held liable in damages for a false and fraudulent statement BnmBwlck - 

of its manager, by which the plaintiff had been induced to 
accept a bill in which the bank was interested. 

In Swire v. Francis (n) these cases were again approved, Swire v. Frai 
but this was not an action against a company. Swire v. Francis 
is, however, another clear authority to the effect that principals 
are liable for the frauds of their agents on precisely the Bame 
grounds on which they are liable for other acts which are not 
in fact authorised : and this the writer conceives to be the true 
doctrine (o). 

But assuming this to be the law it will be still true that n 
company (like any other principal) is not liable in damages for 
a false and fraudulent representation of its agent unless such 
representation has been made for and on behalf of the company 
and in the course of the business which it is his duty to trans- 
act. Bwrnes v. Pennell {p), which has been already noticed, is 
an illustration of the application of this principle to reports 
made by directors to shareholders and shown to other persons 
by agents of the company, but by agents whose employment 
did not extend to circulating the reports. 

So in British Mutual Bank Co. v. Cham wood Forest Railway British Mutual 
Co. (q), a company was held not liable for a false and fraudu- ^, ank Co - ?• 

C nam wood 
Forest Rail. Co. 

(?) L. E. 2 Ex. 259, a case of the Law of Torts, p. 25, et seq. ; 

fraudulent concealment. Compare Pollock on Torts, 236, et seq. In 

Swift v. Jewsbury, L. B, 9 Q. B. 301, Houldsworth v. City of Glasgow Baal, 

which turned on the signature of 5 App. Ca. 317, ante, p. 74, the 

the manager not being the signature liability of the company, but for the 

of the bank, within 9 Geo. 4, c. 14, winding up, was not denied by the 

§ 6. House of Lords. 

(m) L. E, 5 P. C. 394. (p) Ante,?. 215. See, also, Peek v. 

(») 3 App. Ca. 106. Gumey, L. E. 6 H. L. 377. 

(o) See Bigelow's Lead. Ca. on (q) 18 Q. B. JD. _714„ Observe 


Ek ? t h i V ' 3 ' lent re P resenta ti° n made by an agent for his own purposes and 
- not in fact for or on behalf of the company ; although the re- 
presentation related to matters as to which it was his business 
to answer inquiries. 

Bainett, Hoares Again in Burnett, Hoares & Co. v. South London Tram. 

London Tram. 1 @ 0, ( r )> a company was held not liable in damages for a 
false and fraudulent representation made by its secretary, on 
the ground that it was not his duty to make representations 
on behalf of the company. 

In the two last cases the company derived no benefit from 
the misrepresentation. This circumstance was material on the 
question whether the agent was or was not acting for and on 
behalf of the company ; but if he had been so acting within the 
scope of his employment, the fact that the company was not 
benefited would, it is apprehended, have been immaterial. 

Frauds on Stock In Barry v. Croskey (s), it was attempted to make a com- 

ang ^' , P an Y liable for alleged frauds on the part of the directors in 
Barry r. Croskey. . 

getting up the company and issuing its shares, and in procur- 
ing the recognition of the company by the Stock Exchange 
Committee, and the appointment of a settling day for its 
shares. The bill charged that the company had adopted and 
ratified the acts of the directors, and that by the frauds in 
question the shares of the company had commanded in the 
market prices considerably higher than would otherwise have 
been possible. The bill then stated various dealings and trans- 
actions in shares of the company between the plaintiff and the 
broker of one of the directors, and that by these dealings and 
transactions, which were in fact time bargains, the plaintiff had 
lost money in consequence of the frauds of which he com- 
plained. The plaintiff by his bill sought to have all the con- 
tracts into which he had entered with the directors cancelled, 
and to be repaid all the moneys paid by him under those con- 
tracts. To this bill the company demurred ; and the demurrer 
was allowed on the ground that the frauds complained of were, 
according to the plaintiff's own statements, such as could not 

that the person deceived did not to this circumstance, 

know that the agent was not in fact (r) 18 Q. B. D. 815. 

acting for the company, and qu. (s) 2 J. & H. 1. 
whether sufficient weight was given 


be attributed to the company, but only tc the individuals who Bk. II. Chap. 3. 

were concerned in their perpetration. The company had done — 

nothing in order to induce the plaintiff or any one else to 
speculate in its shares; the company knew nothing of the 
plaintiff nor of his dealings, and had not in any way been 
benefited thereby; the damage moreover sustained by the 
plaintiff was too remote to be attributed to anything imputable 
to the company. The Vice-Chancellor observed that " if this 
were the case not of a company and its directors, but of an 
individual principal and of his agent, the principal could never 
be held responsible in the manner for which the plaintiff 

For reasons which have been already explained (Bk. I. c. 3, § 1), 
a company is not liable in damages for false as distinguished 
from fraudulent statements of its directors or agents ; nor is a 
company responsible in damages for those acts which can only Companies act, 
be regarded as fraudulent by reason of § 38 of the Companies 1867 ' § 
act, 18G7 0). 

The personal liability of directors and others for frauds com- 
mitted by themselves has been already fully examined. See 
Bk. I. c. 3, §§ 1 and 2. 

(0 Ante, pp. 91, 92. 





Bk. II. Chap. 4. 
Sect. 1. 

Contracts of 



It is a rule of the common law that, subject to one or two 
exceptions which will be noticed presently, a body corporate 
is not bound by any contract which is not under its corporate 
seal ; and this rule has always been rigidly adhered to both at 
law and in equity (a). 

(«■) See generally, on this subject, 
Com. Dig. Franchise, F. 13 ; Bac. 
Ab. Corporation ; Vin. Ab. Corpo- 
ration ; Grant on Corporations ; 
Pollock on Contracts, 4th ed., p. 
146, et seq.; R. v. Bigg, 3 P. W. 
419 ; Broughton v. The Manchester 
and Salford Waterworks Co., 3 B. 

6 A. 1 ; and on the application 
of the rule in equity as well as 
at law, see Winne v. Bampton, 
3 Atk. 473 ; Taylor v. Dulwich 
Hospital, 1 P. W. 655 ; Wilmot v. 
Corporation of Coventry, 1 Y. & C. 
Ex. 518 ; Carter v. Dean of Ely, 

7 Sim. 211 ; Gooday v. The Col- 
chester Kail. Co., 17 Beav. 132 ; 
Preston v. The Liverpool, &c, Rail. 
Co., ib. 114, and 5 H. L. C. 605. 
An action will in some cases lie 
against a corporation for money had 
and received, Hall v. The Mayor of 
Swansea, 5 Q. B. 548 ; for money 
paid, Jefferys v. Gurr, 2 B. & Ad. 

833 ; for use and occupation, Lowe 
v. The London and North-West . 
Rail. Co., 18 Q. B. 632 ; and see 
Eccl. Comrs. v. Merral, L. R. 4 Ex. 
162 ; but see Finlay v. The Bristol 
Rail. Co. y 7 Ex. 409. As to actions 
by corporations on contracts not 
under seal, see South of Ireland Coll. 
Co. v. Waddle, L. B. 3 C. P. 463, 
and 4 ib. 617, overruling East Lon- 
don Waterworks Co. v. Bailey, 4 Bing. 
283. See, also, McArdle v. Irish 
Iodine Co., 15 Ir. Com. Law Rep. 
146 ; Copper Miners' Co. v. Fox, 16 
Q. B. 229 ; Fishmongers' Co. v. Ro- 
bertson, 5 Man. & Gr. 131 ; Mayor of 
Stafford v. Till, 4 Bing. 75 ; Doe v. 
Taniere, 12 Q. B. 998 ; TJie London 
Dock Co. v. Sinnott, 8 E. & B. 347 ; 
Doc v.Bold, 11 Q. B. 127. See as to 
the engagement of a clerk to a work- 
house, Austin v. Guardians ofBethnal 
Green, L. R. 9 C. P. 91 ; and as to the 
appointment and retainer of a soli- 



At common law any sea! affixed by the proper authority will Bk - "■ ' lll i ' 

suffice (6); but any director or other agent of a limited com 

pany under the Companies act, 1802, who uses a seal without 
the company's name engraved upon it makes himself liable to 
a penalty of 501. (See sects. 41 and 42 of that act.) There is 
a similar provision in the Industrial and provident societies 
ad, 1870 (39 & 40 Vict. c. 45, § 10, sub-s. 1, and § 18, 

Sllb-S. 2). 

Even a resolution of the members of the body corporate Lfl 
not equivalent to an instrument under its seal (c) ; and a cor- 
poration will not be compelled to execute a contract which it 
has been resolved shall be entered into by it(<I). A distinction 
was at one time supposed to exist between executed and 
executory contracts ; but except where the equitable doctrines 
of part performance are applicable, a corporation is no more 
bound by a contract not under its seal, of which it has had the 
benefit, than it is by a similar contract which has not been 
acted upon by either party (e). 

citor by an incorporated company, 
Thames Haven Dock Co. v. Hull, 
5 Man. & Gr. 274; Faridl v. 
The Eastern Counties Rail. Co., 2 
Ex. 344 ; R. v. Cumberland, 5 Ra. 
Ca. 332, which show that the solici- 
tor on the record will be presumed 
to be properly appointed. If a soli- 
citor sues a company for payment for 
his services, it is doubtful whether 
he must not prove a retainer under 
seal. See Arnold v. The Mayor of 
Poole, 4 Man. & Gr. 860, and com- 
pare Haigh v. North Bierley Union, 
E. B. & E. 873. 

(b) Grant on Corp., 59. See 
as to the proper mode of affixing 
the seal and as to estoppels by in- 
struments under seal improperly 
affixed, Mayor, &c, of the Staple of 
England v. Governor and Co. of Bank 
of England, 21 Q. B. D. 160. 

(c) Gibson v. The East India 
Company, 5 Bing. N. C. 262 ; 
Arnold v. The Mayor of Poole, 4 
Man. & Gr. 860 ; Mayor of Ludlow 

v. Charlton, 6 M. & W. 815 ; Smart 
v. West Ham Union, 10 Ex. 867 ; 
R. v. The Mayor of Stamford, 6 Q. 
B. 433 ; Cope v. The TJiames Haven 
Co., 3 Ex. 841 ; Dunstan v. The 
Imperial Gas Co., 3 B. & Ad. 

(d) Wilmot v. The Corporation of 
Coventry, 1 Y. & C. Ex. 518 ; T 

v. Dulwich Hospital, 1 P. W. 655 ; 
Carter v. Dean of Ely, 7 Sim. 211. 

(e) Mayor of Kidderminster v. 
Hardvnck, L. R. 9 Ex. 13 ; Mayor 
of Ludlovj v. Charlton, 6 M. & W. 
815 ; R. v. Stamford, 6 Q. B. 433 ; 
Paine v. The Strand Union, 8 Q. B. 
326 ; Lamprell v. Tlie Billericay 
Union, 3 Ex. 283; Diggle v. The 
London and Blackwall Rail. Co., 5 
Ex. 442 ; Homersham v. Tlie Wolver- 
hampton Waterworks Co., 6 Ex. 137 ; 
Arnold v. The Mayor of Poole, 4 Man. 
& Gr. 860; Cope v. The Thames 
Haven Co., 3 Ex. 841. Courts of 
ecpuity did not interfere in these 
cases. See Crampton v. Varna Rail. 


Bk. II. Chap. 4. g u t strict as is the rule in question, it is and always has 

been subject to qualification. . There are, it is said, some 
the general matters of so trivial a nature that the} 7 can be done so as to 
rule " bind a corporation in the absence of any instrument under its 

seal (/) ; and what is more to the present purpose, it is held 
that if a corporation is created for a particular purpose, it will 
be bound by unsealed contracts entered into on its behalf in 
the ordinary course and bond fide for the purpose for which it 
is created (g). Upon this principle the East India Gompany 
was held liable to be sued upon bills of exchange accepted on 
its behalf, although its seal was not upon them (li). So gas 
companies have been held bound by agreements, not under 
seal, for the supply of gas (i) and gas meters (k) ; a navigation 
company has been held bound by a contract, not under seal, 
for the navigation of its ships (I) ; a railway coinpam- has been 
held bound to pay for rails, oil, and paint, &c, supplied to it 
on the order of its officers (m) ; a colliery company for pump- 
ing maehineiy supplied for the purposes of its colliery (n) ; a 
poor law union for coals supplied on similar orders (o) ; and a 
municipal corporation owning a dock for refusing to admit a 

Co., 7 Ch. 562 ; Kirk v. The Bromley 2 Burr. 1216, and Murray v. Tlie 

Union, 2 Ph. 640 ; Ambrose v. The East India Co., 5 B. & A. 204. 

Dunmow Union, 9 Beav. 508 ; Jack- (i) Church v. The Imperial Gas 

son v. Tlie North Wales Rail. Co., 13 Light Co., 6 A. & E. 846. 

Jur. 69 ; The Directors of the Mid- (Jc) Beverley v. The Lincoln Gas 

land Great West. Rail, of Ireland v. Co., 6 A. & E. 829. The judgment 

Johnson, 6 H. L. C. 798. As to the in this case deserves more attention 

effect of affixing the company's seal than it has received. 

after the contract has been partly (I) Henderson v. The Australian 

performed, see Melliss v. Shirley Royal Mail Steam Navigation Co., 5 

Local Board, 14 Q. B. D. 911, re- E. & B. 409. 

versed on another point, 16 Q. B. D. (m) Ebbw Vale Co.'s claim, 8 Eq. 

446. 14 ; Denton v. East Anglian Rail. Co., 

(/) See as to this, South of Ireland 3 Car. & Kir. 16. Compare Copper 

Coll. Co. v. Waddle, L. R. 3 C. P. Miners' Co. v. Fox, 16 Q. B. 229, 

463, and 4 ib. 617 ; and Eaton v. where the corporation was held not 

Basker, 7 Q. B. D. at p. 532. liable for iron rails. 

(g) See as to the last condition, (?;) South of Ireland Coll. Co. v. 

Ebbw Vale Co.'s claim, 8 Ecp 14, Waddle, L. R. 3 C. P. 463, and 4 ib. 

which, properly understood, is not 617. 

inconsistent with the text. (o) Nicholson v. Bradfield Union, 

(h) Edie v. The East India Co., L. R. 1 Q. B. 620. 



ship which they had agreed to admit in its turn (p). On the Bk II. Chap. 4. 

other hand it was held in a well-considered case, that a dock Sect h 

company was not bound by an unsealed agreement for cleansing 
its docks (q) ; and still more recently that poor law guardians 
are not bound by an unsealed agreement engaging a clerk (r). 
The exception in question, therefore, must still be applied 
with caution (s). 

Another qualification of the general rule is founded upon Part perform- 
the equitable doctrine of part performance. If a corporation an ° e * 
has entered into an unsealed agreement which has been partly 
performed, and if the nature of the agreement and other cir- 
cumstances are such as would induce a Court to decree specific 
performance of the contract if the parties to it were ordinary 
individuals, the Court will hold the corporation bound by the 
agreement, and will enforce it accordingly against or in favour 
of the corporation as the case may require (t). 

A corporation may obviously ratify, under seal, a contract Ratification. 
previously entered into but not under seal (//) ; but whether 

(p) Wells v. The Mayor of Hull, 
L. E. 10 C. P. 402. 

(q) London Dock Co. v. Sinnott, 8 
E. & B. 347. But see on this case, 
South of Ireland Coll. Co. v. Waddle, 
ubi sup. 

(r) Austin v. Guardians of Bethnal 
Green, L. R. 9 C. P. 91. Compare 
Scott v. Clifton School Board, 14 Q. 
B. D. 500. 

(s) These exceptions do not apply 
to non-trading corporations, the con- 
tracts of which are required by 
special statutes to be under seal. 
See the following cases under the 
Pubbc health act, 1875 (38 & 39 
Vict. c. 55, §§ 173 & 174) ; Young 
& Co. v. Mayor of Leamington Spa, 
8 Q. B. D. 579, 8 App. Ca. 517; 
Eaton v. Basher, 6 Q. B. D. 201, 
reversed 7 Q. B. D. 529, on the 
ground that the act did not require 
the contract in question to be under 
seal ; Runt v. Wimbledon Local 
Board, 3 C. P. D. 208, 4 C. P. D. 

(0 See Melbouriu Banking Corpo- 
ration v. Brougham, 4 App. Ca. 156 
at p. 168 ; Crook v. Seaford, 10 Eq. 
678, and 6 Ch. 551 ; London and 
Birmingham Rail. Co. v. Winter, Cr. 
& Ph. 57 ; Earl of Lindsey v. Great 
Northern Bail. Co., 10 Ha. 664 ; 
Laird v. Birkenhead Bail. Co., 
Johns. 500 ; Wilson v. West Hartle- 
pool Rail. Co., 34 Beav. 187, and 2 
De G. J. & Sm. 475 ; Marshall v. 
Corporation of Queenborough, 1 Sim. 
& Stu. 520; Maxwell v. Dulwich 
College, 7 Sim. 222, note ; Stevens' 
Hospital v. Dyas, 15 Ir. Ch. 405. In 
Crampton v. Varna Rail. Co., 7 Ch. 
562, the contract was not one which 
could be specifically enforced, and 
in Leominster Canal Co. v. Shrewsbury 
and Hereford Rail. Co., 3 K. & J. 
654, there was nothing amounting 
to part performance in the sense 
in which that expression is used in 

(u) See ante, book ii., c. 2, § 4. 



Estoppel by 

Effect of a 

Ek. II. Chap. 4. an y other ratification of a contract required to be under seal 

Sect. 1. J . . . ?_ . , 

-will bind the corporation is questionable ix). It has, indeed, 
been said, that a corporation which sues upon an unsealed 
contract thereby irrevocably ratifies it by matter of record ; 
and that the invalidity of the contract sued upon cannot avail 
as a defence to the action ; and further, that if the corporation 
is afterwards sued upon the same contract, it would be es- 
topped from denying its validity (?/) . These propositions have, 
however, been denied \>y high authority and cannot be relied 
upon (z) . 

If, however, a corporation is sued upon an unsealed agree- 
ment and judgment is obtained against it, the corporation will 
not be allowed afterwards to repudiate the agreement, as 
against the person who has obtained the judgment, unless the 
judgment can be shown to have been obtained by fraud ; or 
unless the agreement itself can be impeached for fraud and 
the question of fraud was not in issue in the action in which 
judgment was obtained (a). 

Before leaving the present subject, it may be observed that 
although an instrument sealed with the corporate seal is prima 
facie valid, yet if the seal is essential to its validity, and if it 
be proved that the seal was improperly affixed, e.g., was 
affixed by a person having no authority to use it, the instru- 
ment is void as a corporate act (b). But those persons who in 
practice conduct a company's business, have implied authority 

Seal improperly 

(x) See the observations of Lord 
Blackburn, L. R. 9 Ex. 261. 

(y) Fishmongers' Co. v. Robertson, 
5 Man. & Gr. 192. 

(z) Mayor of Kidderminster v. 
HardivicJce, L. R. 9 Ex. 13 ; Copper 
Miners' Co. v. Fox, 16 Q. B. 229. 

(ft) See Williams v. St. George's 
Harbour Co., 2 De G. & J. 547 ; 
Eulett's case, 2 J. & H. 306. In 
The Athenamm Life Assur. Soc. v. 
Pooley, 1 Giff. 102, and 3 De G. & 
J. 294, debentures were set aside, 
although in Agar v. Athenazum, etc., 
Co., 3 C. B. N. S. 725, judgment 
had been obtained on another of 
like nature. But in the latter case 

the only plea was non est factum, 
and no question of fraud, even if 
there were any in that case, was 
raised. As to what fraud will 
avoid a deed at law, see Wright v. 
Campbell, 2 Fos. & Fin. 393. 

(b) See Mayor, efcc, Staple of 
England v. Governor and Co. of Bank 
of England, 21 Q. B. D. 160 ; Bank 
of Ireland, v. Trustees of Evans' 
Charities, 5 H. L. C. 389 ; 
Colchester v. Lowten, 1 V. & B. 
243/ 244 ; D'Arcy v. Tamar, efcc, 
Bail. Co., L. R. 2 Ex. 158. Com- 
pare Ex parte The Contract Corpo- 
ration, 3 Ch. 105. 

ON < ON I RAI I - "l UNDER -l LL. 22.1 

to use its seal for the purposes of such business (c) : and a Bk - n. Chap. 4. 
corporation will be estopped from disputing the authority to — 
fix tlif seal if negligence imputable to the corporation has 
conduced to the misuse of the seal and to the misleading of 
the person relying on it (d). 


The general rule, that a corporation is not bound by any Contra 
contract not under its common seal, applies to all incorporated 
companies, save where it has been abrogated by statute; 
whence it follows, that in order that an incorporated company 
may be hound by a contract entered into on its behalf, the 
contract must fall within one of the exceptions already referred 
to, or he under the common seal of the company, or be i ntered 
into in the manner and form directed by the statute which em- 
powers the company to contract in some other mode(<'). 

It is important, therefore, to ascertain what statutory enact- 
ments there are bearing upon this subject. 

The Banking act, 7 Geo. 4, c. 40, and the Letters Patent Statutory 

• enactm nts. 

act, 7 mil. 4H\ ict. c. 73, leave the common law untouched 

as regards the question now under consideration. But com- 
panies regulated by these acts are not incorporated by them. 

The Joint-stock companies registration act, 7^8 Vict. c. 
110, §§ 44-46; the Joint-stock companies banking act, 7 & 8 
Vict. c. 113, § 22; and the Joint-stock companies act of 1856, 
§ 41, all contained provisions on this subject; but these acts 
are now repealed, and it is not necessary further to allude to 

(c) See Ex parte Contract Corp., 3 Thames Haven Co., 3 Ex. 841 ; 

Ch. 105. Copper Miners' Co. v. Fox, 16 Q. B. 

{d) See the first two cases in note 229 ; and see Ernest v. Nicholls, 6 

(b). H. L. C. 401. 

(e) Homersham v. Tlie Wolver- (/) Upon 7 & 8 Vict. c. 110, § 45, 

hampton Waterworks Co., 6 Ex. 137 ; relating to bills and notes, see Hal- 

Digglev. The London and Blackwall ford v. Cameron's Coalbrook Co., 16 

Bail. Co., 5 Ex. 442; Cope v. The Q. B. 442; Edwards v. Cameron's 

L.C. Q 


Ek ' Sc Ch 2 P ' 4 ' ^ By the Metro P olis § as act > 18G0 (9)> tlie contracts of gas 
companies regulated by that act and entered into in accord - 

(1) Metropolitan . . . .... 

gas act. ance with it are binding without any seal, if signed by two or 

more directors, or by the company's secretary, or other officer, 
by the authority of two or more directors. 

(2) 8 & 9 Vict. (2) The Companies clauses consolidation act, 8 & 9 Yict. 

c. 16. 

c. 1G, renders it lawful for the directors of a company to which 
that act applies to appoint committees (§ 95), and enacts (§ 97) 
that the power of the committees as well as the power of the 
directors to make contracts on behalf of the company may 
lawfully be exercised as follows : — 

" With respect to any contract, which if made between private persons, 
would be by law required to be in writing and under seal, such committee 
or t the directors may make such contract on behalf of the company in 
writing and under the common seal of the company, and in the same 
manner may vary or discharge the same. 

"With respect to any contract, which if made between private persons, 
would be by law required to be in writing, and signed by the parties to be 
charged therewith, then such committee or the directors may make such 
contract on behalf of the company in writing, signed by such committee or 
any two of them, or any two of the directors, and in the same manner may 
vary or discharge the same. 

" With respect to any contract which, if made between private parties, 
would by law be valid though made by parol only, and not reduced into 
writing, such committee or the directors may make such contract on behalf 
of the company by parol only, without writing, and in the same manner 
may vary or discharge the same." 

Cases on tins This enactment does not render a company liable on a 

contract entered into b} r its directors in writing, but not pur- 

Coalbrook Co., 6 Ex. 269; Aggs v. with directors, see Stem's case, 

Nicholson, 1 H. & N. 165 ; Healey Johns. 480 ; Ernest v. Nicholls, 6 

v. Story, 3 Ex. 3 ; Allen v. The Sea, H. L. C. 401 ; Curteis v. Anchor 

Fire, and Life Insurance Co., 9 C. B. Insur. Co., 2 H. & X. 537 ; Poole v. 

574 ; Gordon v. The Sea, Fire, and National Provincial, &c. } Assurance 

Life Insurance Co., 1 H. & N. 599. Society, ib. 6S7 ; Murray's Ex. ca., 

As to § 44, relating to other con- 5 De G. M. & G. 746 ; Teversham v. 

tracts, see Ridley v. Tlie Plymouth Cameron's Coalbrooh, d-c, Pail. Co., 

Grinding Co., 2 Ex. 711 ; Ex parte 3 De G. & S. 296 ; Baker's case, 1 

Eagle Insur. Co., 4 K. & J. 549 ; Dr. & Sm. 55. 

Harribro' v. Hull and London Fire (g) 23 & 24 Vict. c. 125, § 20. 

Insur. Co., 3 H. & N. 789 ; British Quaere what the words " entered 

Empire Co. v. Browne, 12 C. B. 723. into in accordance with this act" 

As to § 29, relating to contracts really mean. 


porting to bind the company (h) : nor on a contract required Bk. 

Sect. 2. 

to be under eal or signed by two directors, bul which is neither 
under seal nor bo signed, although the company may have 
had the benefit of the contract (i . Moreover, notwithstanding 
the general words of the last clause of the enactment, it has 
been decided thai where a company has entered intoa contract 
in proper form for the execution of certain specified works, it 
is uot hound to pay for extra works not done under the con- 
tract, although they may have bet o done by the orders and 
under the superintendence of the officer appointed by the 
directors to 3ee the specified works properly executed (A;). At 
the same time, where the company has had the benefit of a 
contract which, if entered into between ordinary individuals 
would be valid, although not in writing, it will he presumed, 
in the absence of evidence to the contrary, that such contract 
was duly made by the directors of the company or a committee 
of them, or by an agent duly appointed, so as to he binding on 
the company. Upon this principle a railway company has 
been held liable to pay for the use and occupation of land 
occupied by it for the purposes of its business (/) ; and to pay 
for sleepers furnished to the company at the requesl of its 
engineer (m) ; although there was nothing in either case to 
show that any express written or parol contract had been 
entered into on behalf of the company by its directors or any 
committee of them. 

Ordinary individuals can appoint agents verbally, and the The Statute of 

frauds and the 
clauses act. 
(h) See Serrell v. The Derbyshire, Waterworks Lo., 6 Ex. 13/. See, 

d-c., Rail. Co., 9 C. B. 811 ; and further, as to extra works, Ranger v. 

McCollin v. Gilpin, 5 Q. B. D. 390 Tlie Great Western Rail. Co., 5 H. L. 

affirmed G Q. B. D. 516, the case of C. 72 ; and Nixon v. The Tuff Vale 

a company governed by the Com- Rail. Co., 7 Ha. 136 ; KirJc v. Tlie 

panies act, 1862. Bromley Union, 2 Ph. 640; Lamprell 

(i) Leominster Canal Co. v. Tlie v. The Billericay Union, 3 Ex. 283. 
Shrewsbury and Hereford Rail. Co., 3 (I) Lowe v. Tlie London and North- 

K. & J. 654. See, too, Higgle v. Western Rail. Co. 18 Q. B. 632. See 

London and Blackball Rail. Co., 5 Finlay v. Tlie Bristol and Exeter Rail. 

Ex. 442 ; Midland Great Western Co., 7 Ex. 409. 

Rail. Co. of Ireland v. Johnson, 6 (m) Pauling v. The London and 

H. L. C. 798. But see as to cases North- Western Rail. Co., 8 Ex. 867. 

of part performance, ante, p. 223. See further on this subject, ante, p. 

(k) Homersham v. Wolverhampton 222. 

Q -2 



Bk. II. Chap. 
Sect. 2. 

The Lands 
clauses act. 

(3) The Compa- 
nies act, 1S56. 

The Companies 
acts, 1802 and 

4th and 17th sections of the Statute of frauds, which in cer- 
tain cases require contracts to be evidenced by some writing 
signed by the party to be charged, or his agent, do not render 
it necessary that the agent there spoken of should be appointed 
in writing (n). Hence a written contract entered into on 
behalf of a railway company for the purchase of land, and 
signed by its agent, is apparently binding on the company, 
although the agent may not have been appointed under seal 
or by any writing signed b} T two directors or members of a 
committee (o). 

It is beyond the scope of the present work to treat of the 
method in which companies governed by special acts of Parlia- 
ment and the Lands clauses act can obtain land for the pur- 
pose of their undertakings ; but it is not altogether irrelevant 
to observe that where parties have agreed to refer questions 
of disputed compensation under that act to arbitration, the 
appointment of an arbitrator on the part of the company may 
be made by the secretary (p). 

(3) The Companies act of 1856 contained a clause (q) similar 
to that which occurs in the Companies clauses consolidation 
act (r) ; and although the act of 1856 is repealed, it has been 
decided that companies formed and registered under it may 
still be bound by unsealed contracts (s). The Companies act, 
1862, contained no similar clause : but this defect has been 
cured by the Companies act, 1867 (t). Under it a memorandum 
signed by a director is sufficient to bind the company so far as 
the Statute of frauds is concerned (»). 

(ri) Coles v. Trecothick, 9 Ves. 250 ; 
Clinan v. Cooke, 1 Sell. & Lef. 31. 
Maclean v. Dunn, 4 Bing. 722, shows 
that a verbal ratification of a previ- 
ously unauthorised agreement signed 
by an agent renders the agreement 
binding on the principal. 

(o) See the cases on the Companies 
act, 1867, in note («). See, also, 
Wilson v. West Hartlepool Bail. Co., 
34 Beav. 187, and 2 De G. J. & Sm. 
475, where, however, this point was 
not alluded to. 

(p) Collins V. South Staffordshire 
Ha il. < 'o. } 7 Ex. 5. 

(q) 19 & 20 Vict. c. 47, § 41. 

(?•) Ante, p. 226. 

(s) Prince v. Prince, 1 Eq. 490. 

(0 30 & 31 Vict. c. 131, § 37, 
which is similar to 8 & 9 Vict. c. 16, 
§ 97, above set out. See, as to the 
act of 1862, South of Ireland Coll. Co. 
v. Waddle, L. R. 3 C. P. 463, and 4 
ib. 617, and Totter dell v. Fareham 
Brick Co., L. R. 1 C. P. 674. 

( u) Jones v. Victoria Craving Dock, 
2 Q. B. D. 314. See, also, Beer v. 
London and Paris Hotel Co., 20 Eq. 


The act also provides for the appointment by a company l;k - 'J Ch *P- 4 - 
under its common seal, of agents to execute deeds abroad, and 

Deeds executed 
renders deeds executed by them as valid ;is if scaled by the ahmad. 

company (a;). This provision lias been extended by a sub- Companies seals 

r> I \ 1 • • act > 1864. 

sequent act of rail lament (//), which authorises companies 
governed by the Companies act, 1862, and carrying on busi- 
ness in foreign countries, to keep duplicate common seals there, 
having engraved upon them the name of the place in which 
they are to be used. The act, however, only applies to com- 
panies expressly authorised by their articles of association, or 
a special resolution to exercise the powers given by the act; 
and the persons entrusted with the seals must be specially 
empowered to use them by some instrument in writing under 
the common seal of the company. Instruments sealed by 
such persons in the place to which the seal entrusted to them 
applies, are as binding on the company as if such instru- 
ments had been sealed in this country with the ordinary 
common seal. 

(./•) § 55. this act in the appendix, and its 

(//) 27 & 28 Vict. c. 19. It has general effect only is attempted to 
not been thought necessary to print be given above. 



Bk. II. Chap. 4. 
Sect. 3. 


Bills of 
Exchange act, 

under seal. 

Companies act, 

By the Bills of exchange act, 1882 (c), a bill of exchange 
may be made payable to the holder of an office for the time 
being. The older cases therefore to the effect that a bill 
payable to the secretary or treasurer for the time being of a 
company, is invalid (d), are no longer law. 

In general the persons liable to be sued on a bill of ex- 
change as drawer, indorser, or acceptor, are the persons who 
have signed it as such and no others (e) ; but this rule does not 
affect the provisions of the Companies act, 1862, nor any act 
relating to joint-stock banks or companies, or the Bank of 
England or Bank of Ireland (ee). 

The power of a corporation to bind itself by drawing, 
accepting, or endorsing a bill is left by the act to depend upon 
the law for the time being in force relating to corporations (/). 
This power, so far as regards companies, has been already 
alluded to {(f). 

It is doubtful whether an instrument under seal can by the 
law merchant be a negotiable instrument {h) ; but now by the 
Bills of Exchange act, 1882 (hh), if an incorporated company 
has power to draw, accept, or indorse a bill, and it does so 
under its corporate seal, the company is liable to be sued on 
the bill. 

The Companies act, 1862, expressly enacts that promissory 
notes and bills of exchange shall be deemed to be made, 
accepted, or endorsed on behalf of a company registered under 
the act, if made, accepted, or endorsed in the name or by or 

(c) 45 & 46 Vict. c. 61, § 7 (2). 
and see as to promissory notes, 
§ 89 (1). 

(d) Yates v. Nash, 8 C. B. N. S. 
581 ; Storm v. Sterling, 3 E. & B. 
832, and Coicic v. Sterling, 6 E. & B. 

(c) 45 & 46 Vict. c. 61, § 23, and 
see § 89, as to promissory notes. 
(ee) lb., § 97 (3). 
(/) lb., § 22. 
(g) Bk. i., c. 2, § 2, and ante, 

p. 185. 

(/() See Grouch v. Credit Fonder 
of England, L. R. 8 Q. B., at p. 382. 
In Ex parte City Bank, 3 Cli. 758, 
the holder of a debenture payable to 
bearer, and under the seal of the 
company, was held entitled to prove 
for its amount, and per Selwyn, 
L. J., it was a promissory note. 
See, also, Ex parte Colborn and 
Strawbridge, 11 Eq. 478. 

{hh) See 45 & 46 Vict, c. 61,]§ 91. 


"ii behalf or on account of tin- company, by any person acting ''• '■ 

under its authority (/). 

Moreover, if any director, manager, or officer of a limited 
company signs on behalf of the company any lull or note 
without adding the word " limited,'' he is personally liabli 
pay the same, unless it is duly paid by the company(A). 

Directors and others constantly make promissory notes, and Liability of 
i , i i -ii • i -i • directora. 

draw and accept bills in such a manner as to make it very 

difficult to say whether they personally, or only the compai 
for whom they art, are liable upon the instrument (I). The 
question is in every case one of construction ; is the bill or note 
the bill or note ofthe company or no1 ? 1 >oes it really purport 
so to be? for, although given for the purposes ofthe com- 
pany, the bill or note may not ev< n purport to hind it. If on 
the true construction ofthe instrument the bill or note is the bill 
or note of the company, the company will be liable upon it, and 
not the individuals whose names are on it > m), unless the bill or 
note is the bill or note of both. On the other hand, if on 
the true construction of the bill or note it is not the bill or 
note of the company, the persons whose names are upon it will 
be liable upon it, whether they intended to be so or not. 

The following cases illustrate these principles. A bill 
drawn on the directors of a company, and accepted for the 
company by its manager and three of its directors, binds the 
three directors who accept the bill, but no one else (n). A 
fortiori, a bill drawn on the agent of a company, and accepted 
by him simply in his own name, binds him and not the com- 
pany {<>). On the other hand, a bill drawn on a company and 
accepted by its directors, secretary, or other authorised agent 
on its behalf or as its agent, binds the company and not those 
who accept the bill, except so far as they are members of the 

(i) § 47. See Ex parte Overdid, give it will he liable, West London 

Gurney cO Co., 4 Ch. 460; Be Barber Commercial Bank v. Kitson, 13 Q. 

& Co., 9 Eq. 725. B. D. 360. See, also, as to not adil- 

(/;) § 42 ; Penrose v. Martyr, E. B. ing " limited," ante, note (k). 

& E. 499. (n) Bult v. Morell, 12 A. & E. 

(/) See as regards firms, Partn. 745. 

180, et seq. (o) Ducarrey v. Gill, 1 Moo. & M. 

(m) This supposes that the bill is 450, and 4 C. & P. 121 ; Thomas v. 

not ultra vires, for if it is these who Bishop, 7 Mod. 180. 


Bk. II. Chap. 4. company (7)). But to this last rule there is an exception, as 
—^ already noticed (q). 

Examples of the 

foregoing rules. Iii Thomas v. Bishop (r), the bill was drawn on John Bishop, cashier of the 
Thomas v. York Buildings Company, and was accepted by Bishop in his own name, 

Bishop. without reference to the company, and he was held by Lord Hardwicke to 

be personally liable on the bill. 
Senell v. The In Serrell v. The Derbyshire, Staffordshire, &c, Railway Company (s), a 

Der >\ shire, sc., cheque was drawn on the bankers of a companv, and was signed bv three 
Railway Cum- ,. .. . . , -, ^ , -, 

, 1(nv _ ' directors, and countersigned by the secretary, and on the cheque was a date 

stamp, with the name of the company in a circle round the date ; but the 

companv was held not liable upon the cheque, for it did not purport to 

be a cheque of the company. The persons who signed the cheque had not 

even signed it as directors. 

Butt v. Morell. In Bull v. Morell{t), the bill was drawn on The Directors of the Imperial 

Salt and Alkali Company, and was accepted for the Imperial Salt and Alkali 

Company, and signed 

Richard Parker, Manager, 

J. Rainsford, \ 

James Parker, (. Directors. 

Richard <■' irrett, ) 

The three last named persons only were held liable on the bill. 
Nicholls v. In Nicholls v. Diamond (»), the bill was drawn on "Mr. James Diamond, 

Diamond. purser, West Downs Mining Company" and was accepted thus, "James 

Diamond, accepted per p>roc. West Downs Mining Company." Diamond was 

held liable on this bill. 
Mare v. Charles. In Mare v. Charles (x),& bill was drawn on Jl'm. Charles for goods supplied 

to a mine, and was "accepted for the company, Wm. Charles," and thisaccepl- 

ance was held to render Charles solely liable. 

Promissory Similar principles are applicable to promissory notes. In 

the following cases the makers were held personally liable 
upon them : — 

Penkivil v. We, the directors of the Royal Bank of Australia, for ourselves and 

Connell. other shareholders of this company, jointlj- and severally promise to 

pay, &c, value received on account of the company. 
T. W. Sutherland, n 
J. Connell, I 

M. Boyd, Directors (,,). 

A. Dcff, 

(p) See Edwards v. Barnard, 32 (r) 7 Mod. 180. 

Ch. D. 447 ; Edwards v. Cameron's (s) 9'C. B. 811. 

Coalbrook Co., 6 Ex. 269 ; Halford (t) 12 A. & E. 745. 

v. Cameron's Coalbrook Co., 16 Q. B. (») 9 Ex. 154. 

442, and Eastwood v. Bain, 3 H. & (x) 5 E. & B. 978. 

N. 738. (y) Penkivil v. Connell, 5 Ex. 381. 

(7) See, ante, note (k). See, also, Healey v. Storey, 3 Ex. 3. 


,_,,. , . ,,,, . . I'.k. II. Chap. 1. 

Midland < ounties Buildii , ;;. 

We jointly and severally promise to pay, &c. ,.„,,,. 

W. R. UlATII. ) Pi 

S.B. Smith, | Director& 
W. D. Fisher, Secretar 


Two month aftei demand in writing we promise to pay Mr. Tin. ma ■ Price r. Taylor, 
I' £100, for value n ceived. 

W. R. Ill \!M. ) 

JohnTaylor, i TrU8t( 

W. I >. Fisher, Secretary («). 

liven ii' the company's seal is affixed and attested the Dutton v. 
directors signing the note will be liable if they promise to pay, 
as in Dutton v. Marsh(b), where the note ran thus: — 

We, the directors of the Isle of Man Slati I ■ .. Limited, do promise 
to pay J. I>. £1,600, with interest at •'» per cent till paid, for value 
i \ ei 1 . 

Signed by four din 

The company's seal attested was in one corner. 

In Miller v. Thompson (c) the following instrument, drawn Miller u 

on a joint-stock bank, by the manager of one of its branches, 011 '' n ' 
was held to be the promissory note of the directors of the 
bank, and to be binding on them personally ; 

London Trades' Joint Stock Banking Company. 

Dorking, Surrey, 24th August, 1839. 

Six months after date, pay, without acceptance, to the order of John 
Cogan Francis, Esquire, £100, value received. 
(Signed) For the Directors, 

Thomas Newham, Manager. 

(Addressed) The London Trades' Joint Stock Banking 
Company, 33, Gracechurch Street, London. 

On the other hand, companies have been held bound hy notes Notes of com- 

ai £ n • r panies. 

m the following forms : — 

(z) Bottomlcy v. Fisher, 1 H. & C. 234. 

211. (6) L. R. 6 Q. B. 361. 

(a) Price v. Taylor, 5 H. & N. 540. (c) 3 Man. & Gr. 576. 
Compare Lindus v. Melrose, infra, p. 


13k. II. Chap. 4. We, two of the directors of the Ark Life Assurance Society by 

S ecti 3 - and on behalf of the Society, do hereby promise to pay, &c, value 

Aggs v. received. 

J\ic son. (Signed by two directors, and sealed with the seal of the Company) (d). 

Maclae v. We, directors of the Eoyal Bank of Australia, for ourselves and 

Sutherland. other shareholders of the Company, jointly and severally promise 

to pay, &c, for value received, on account of the Company. 
J. W. Sutherland, Chairman. 
Adam Duff, ) 

John Mitchell, } directors («). 

Entered, Benjamin Wood, Secretary. 

Lindas r. We jointly promise to pay, &c, for value received in stock, on 

Melrose. account of the London and Birmingham Iron and Hardware Com- 

pany, Limited. 

James Melrose, \ 
G. N. Wood, > Directors (/;. 

John Harris, ) 
Edwin Guess, Secretary. 

The following instruments have also been held to be pro- 
missory notes binding on companies : — 

... „ Sea, Fire, and Lijc Assurance Society. 

Firr&c.,Com- To the CASHIER, 

P an y- , Credit A., or order, with the sum of, &c, on account of this 


A. Davis, ) 

W. Ouilvie, j Directors (Si- 
Entered, F. F. A., Accountant. 


Forbes v. At sixty days after sight of this our first bill of exchange (second 

Marshall. anc i tliircl of same tenor and date not paid), Ave promise to pay, 

on account of the proprietors of the Union Bank of Calcutta, &c, 

value received. 

J. Eennie, ) 

W. F. Grant, \ Directors (h). 
H. W. Abbott, Secretary. 

(d) Aejijs v. Nicholson, 1 H. & N. & N. 540, ante, p. 233. 

165. (<j) Allen v. The Sea, Fire, and Life 

(e) Maclae v. Sutherland, 3 E. & Assurance Co., 9 C. B. 574. 

B. 1, held to be binding on the (h)- Forbes v. M arshall, 11 Ex. 166. 

members of the company jointly. The above instrument had an accept- 

(/) Lindus v. Melrose, 2 H. & N. ance written across it, and might, it 

293, and 3 ib., 177, held to bind the seems, have been treated as a bill of 

company and not the directors sign- exchange. 
ing. Compare Price v. Taylor, 5 H. 




It is obvious that one person may be benefited by a l:!; - Ir - cha P- 3 - 
contract made by others without being himself in any way 
bound by it. A loan to A. cannol be recovered from B. 
simply because the money lent has come into his hands (a). 
So if the directors of a company enter into a contract which is 
not binding on the company, either upon the ground that the 
contract is ultra vires or upon any other ground, the company 
is not liable on the contract simply because it has had the 
benefit thereof (&)• 

It lias been already seen that a company is not, under 
ordinary circumstances, liable on contracts entered into by its 
promoters before its formation, although it may have had the 
benefit of such contracts (c). Further, a company which has 
benefited by a contract, not binding on it, is not to be deemed 
to have thereby ratified that contract ; nor to have incurred an 
obligation quasi ex contractu, similar to that which would have 
been incurred if the contract had been binding on the company 
in the first instance (d). 

At the same time, a company is liable to refund monev ' B ff an P oi t°X 

. , J sideration winch 

which it has received without consideration, e.g., premiums has failcd - 
paid to it in respect of policies which it had no power to 

(a) Partn. 189. See Emly v. Lye, 309 ; Cork and Youghal Rail. Co., 4 
15 East, 7, and other cases there cited. Ch. 748 ; Hill's case, 9 Eq. 605; 

(b) See, in addition to the cases Chambers v. Manchester and Milford 
cited below, The Worcester Com Ex. Rail. Co., 5 B. & S. 588. See, also, 
Co., 3 D. G. M. & G. 180 ; Fisher v. per Parke, B., in Homersham v. 
Taijler, 2 Ha. 218. Wolverhampton Waterworks Co., 

('') Ante, Bk. ii. c. 1, § 2. Ex. 142, and the cases in the last 

(d) Ex parte Williamson, 5 Ch. few notes. 


Bk. H. Chap. 5. grant (e) ; and money received in respect of shares the contract 
to take which afterwards fails or is rescinded (ce). 

Exception to There is, however, a very important exception to the general 

rule against liability by reason of benefits received. It has been 
long settled in equity that although an infant is not liable at 
law for money borrowed although expended in necessaries, 
nevertheless a person who bond fide advances money to an 
infant is entitled, on the administration of the infant's estate, 
to rank as a creditor in respect of so much of the money 
advanced as has in fact been expended in necessaries (/). A 
similar rule has been applied to mone}- lent to married women 
and expended in properly maintaining them (g). There is a 
further well settled rule that agents and trustees are entitled 
to be indemnified by their principals and ccstnis que irustent 
against all expenses properly incurred in the exercise of their 
authority or the execution of their trust. From these doctrines 
there has been developed a rule to the effect that a compan}' is 
liable to refund money improperly borrowed \>y its directors 
but in fact bond fide applied in discharging debts or liabilities 
of the company which could have been enforced against it, or 
bond fide applied for any other legitimate purpose for which it 
might have come under liability. These last words are added 
because with reference to the matter in hand there can, it is 
conceived, be no difference between paying a person for goods 
already supplied and paying cash for goods which might have 
been obtained from him on credit (h). 

This doctrine has grown out of the celebrated decision in 
the German Mining Company's case (i), which will be hereafter 
referred to when considering the rights of directors to in- 
demnity (Bk. III., c. 2, § 3). The following cases show the 
application of the doctrine to other persons, and the limit of 
its application. 

(c) PJiaiuix Ass. Co. Burges 1 and ea.sos may have gone too far, but the 

Stock's case, 2 J. & H. 441. tendency in this direction has been 

(ee) Ante, pp. 33 and 72, note (ij). checked by more recent decisions. 

(/) Marlow v. Pitfield, 1 P. W. See Ex parte Williamson, 5 Ch. SOD, 

558. and the decisions subsequent to it 

(g) Jcnner v. Morris, 1 Dr. & Sm. noticed in the text. 

218 ; Deare v. Soutten, 9 Eq. 151, (i) Ex parte Chippendale, 4 De G. 

(70 This, however, has not yet M. & G. 119. 
been actually decided. Some of the 


In Re The Cork and Yonghal Railway Company (k), the Bk. II. chap. 5. 
holders of Bome invalid Lloyd's bonds (I) were held not Cork v. Youghal 
entitled to rank as creditors of the company for the amounts S^™ 7 Com " 
of the bonds, bul were held entitled to be paid so much of 
those amounts as they could prove had been properly applied 
for the legitimate purposes of the company ; and an inquiry on 
this head was directed. 

In the Blackburn Building Society v. ( 'unUfe Brooks dt ( 'om- Blackburn 
pany (w), a building society was not only held not to be liable ^fiffe ! 
i" repay money improperly borrowed by its directors bul was 
held entitled to recover from the lenders the sums repaid to 
them out of the funds of the society. But here again an 
exception was made in respect of those sums which could be 
proved to have been applied in discharging the debts and 
liabilities of the society. 

The same principle affords an explanation of certain cases 
in which transferees of debentures, issued ultra vires but in the 
name of a company, have been held entitled to recover from the 
company the value of the consideration received by it for such 

Thus, in the grossly fraudulent case of the Athenceum Life Athenaum As- 
Assurance Society v. Pooley (n), where debentures of a eom-^SS^* 1 
pany given in exchange for Westminster improvement bonds, 
were decided to be invalid in the hands of a bond fide pur- 
chaser for value, the purchaser was held entitled to an inquiry 
whether the company had received any benefit from the bonds. 
Again in the similar and subsequent cases of Wood's Claim Wood's Claim. 
and Brown's Claim (o), Westminster bonds were sold to an 
insurance company for money debentures and shares. The 
transaction was held invalid ; and it appearing that the bonds 
were worth more than the company gave for them, and that 
the company had had the benefit of the excess, the company 
was debited with such excess in an account directed between 
the company and the vendor ; and he, on the other hand, was 

(k) 4Ch. 748. See, also, National (m) 9 App. Ca. 857, and 22 C'h. 

Permanent Benefit Building Soc, 5 D. 61, and 29 ib. 902, noticed ante, 

Ch. 309 ; Magdalena Steam Nav. p. 190. 
Co., Johns. 690. (n) 3 De G. & J. 294. 

(0 As to which see ante, p. 197. (o) 9 W. R. 3(5(5, and 10 ib. 662. 



Bk. II. Chap. 

Ex parte 

Baroness Wen- 
lock v. River 
Dee Company. 

debited with the money paid to him by the company, and with 
the sums realised by him by the sale of the debentures and 

The mere fact that the company has had the use of the 
money is not enough to create an obligation to repay it ; so to 
hold would render nugatory all prohibition against borrowing. 
Accordingly where the managers of a building society borrowed 
money for the society, but in excess of their powers, and the 
money so borrowed was advanced to members on the security of 
their shares, it was held that the lenders had no claim against 
the society either as creditors at law or by reason of the appli- 
cation of the money (_p) . 

The following case also shows that the doctrine in question, 
cannot be extended so as to defeat a company's special act. 

In Baroness Wenlock v. River Bee Company (q) a company 
was created by act of Parliament for the purpose of embanking 
the river Dee and improving the lands near its mouth. 
Limited powers of borrowing and of mortgaging were conferred 
by the act. The directors borrowed money largely in excess 
of their powers ; but the money to a great extent at least was 
bond Jide applied for the legitimate purposes of the company 
i.e., in doing the work which the compairy was formed to do, 
and in paying off pre-existing mortgages, some of which were 
valid and others invalid. The money thus borrowed was held 
not recoverable as a debt (r) ; but so much of the money as 
had been applied in paying off existing valid mortgages and in 
payment of any debts and liabilities properly incurred was 
held to be recoverable (s). But the money applied in paying 
off one of the invalid mortgages was held to be no charge on 
the lands, although the money raised by such invalid mortgage 
had been spent in embanking the river and reclaiming the 
land adjoining it. The ground of this decision (t) was that to 
hold the money so applied to be a charge would be to con- 
travene the terms of the company's special act. 

Qj) Ex parte Williamson, 5 Ch. 

(q) 10 App. Ca. 354 ; 19 Q. B. D. 
155 ; and 36 Ch. D. 674 ; 38 ib. 

(r) 10 App. Ca. 354, ante, p. 189. 

(s) lb., and 36 Ch. D. 675, note. 

(0 38 Ch. D. 534, and 36 ib. 674. 
The mortgage above referred to as 
invalid was the mortgage for ,£6405 
to the Lands Improvement Co. 





The liabilities of directors of companies to their members, 1;k - u - c,,a P- G - 
the liabilities of members to calls, and their liabilities as con- 
tributories in winding-up proceedings will be discussed here- 
after in Books III. and IV. In the present chapter it is 
proposed to examine the separate liability of members of 
companies to creditors and others apari from all questions as 
to their liabilities inter se, whether before or after a winding- 
up order. For this purpose it is necessary to distinguish 
directors from other members; for although what is true of 
members is also true of directors as members, it frequently 
happens that directors incur liabilities by their own acts in 
addition to those to which they art- subject simply in their 
characters as members. 


1. For their own acts. 
It has been already seen that the directors of a company are Torts and 


the agents of the company, but not of each other, unless 
clearly so constituted (a). It has also been seen that directors 
are responsible for the frauds which they may themselves com- 
mit or authorise (/>). On similar principles it is conceived 

(«) Ante, c. 2, § 2. (/») Bk. i. c. 3, § 1 (3) and § 2. 


Bk. II. Chap. 6. that they are personally responsible for any torts which they 
Sect. 1 . 

— may themselves commit or direct others to commit, although 

it may be for the benefit of their company (c). 

It was held in a case in which a company infringed a patent, 

that the directors were personally liable to the costs of a suit 

to restrain the infringement (d). But it would be contrary to 

principle to hold directors personally responsible for the 

negligent or other acts of other servants of the company 

unless the directors are themselves personally implicated in 

such acts. 

Contracts. With respect to contracts directors may bind themselves 

personally, although acting for the company, e.g. by putting 
their names to bills of exchange or promissory notes so 
worded as to be their bills or notes and not those of the com- 
pany (e), or by entering into covenants (/), or other contracts 
so worded as to bind them individually (//). Such cases turn 
on the true interpretation of the documents which may be in 

But if a contract is so worded as to bind the company, the 
directors who sign it are not liable upon it ; unless indeed the 
terms of the contract are such as to bind, both them personally 
and the company, which is sometimes the case (/<). This is in 
accordance with the ordinary rules applicable to contracts with 
agents (?'). The only exception to this rule is, that a director 
contracting for a limited company and suppressing the word 
"limited," is liable personally on the contract (k). 

Position of agent Formerly it was thought that if an agent entered into a con- 

who exceeds his tract 011 b e l ia lf f a principal, and such contract did not bind 
authority. * '■ 

(c) See Mill v. Haviker, L. R. 9 Q. B. D. 516, and 5 ib. 390, where 
Ex. 309, and 10 ib. 92. three directors promised to pay 

(d) See Betts v. De Vitre, 5 N. R. money advanced to the company on 
165, and 3 Ch. 441 : and see an the security of plant, &c. belonging 
article in 10 Jur. N. S. (part 2), to it, and see infra, p. 243. 

p. 475. (h) Lindus v. Melrose, 2 H. & N. 

(e) Ante, c. 4, § 3. 293, and 3 ib. 177 ; Aggs v. Nichol- 
(/) See, as to covenants by agents, son, 1 H. & X. 165 ; Russell v. Reece, 

Appleton v. BinJcs, 5 East, 148 ; 2 Car. & Kir. 669. 
Hancock v. Hodgson, 4 Bing. 269 ; (/) See Partn. 177, &c. 

Hall v. Bainbridge, 1 Man. & Gr. (k) 25 & 26 Vict. c. 89, §§ 41 

42; Pickering's claim, 6 Ch. 525. and 42 ; Penrose v. Martyr, E. B. & 

(g) As in McGollin v. Gilpin, 6 E. 499. 

FOB illKll: OWN ACTS. 211 

the principal, he not having authorised it, the agent was him- 1;; - "• ( li:i i' ,; - 

-'II bound by the contract. According to this doctrine, a con- - 

trait ostensibly entered into by A. through 15. was treated as a 

contract by II., although it was not the intention of either 

party to the contract that 15. should be in any way bound by 

it. The propriety of thus making contracts for persons ha-. 

however, been very properly questioned and denied ; and it i^ 

now held that an agent contracting as such without authority, 

is not bound by tlte contract at all, hut thai he is liable in 

damages lor tin' consequent 9 ensuing from his having 

assumed to act with an authority which in fad he did not 

possess. It is also held that he is thus Liable although he 

acted bond fide and in the belief that In- had the authority he 

assumed (I). 

This result has been arrived at by the fiction of an implied Warranty of 
warranty of authority ; but it really is an exception to the' 11 
general rule that an action will not lie for a misreprest il- 
lation unless fraudulent (in). 

The rule in question is as applicable to directors as to other Personal liability 
kinds of agents (//). But with respect to directors, it must excee( i their 
not be forgotten that in mosi cases the limits of their authority i owers - 
can be readily ascertained, and are supposed to be known (o) ; 
and a person who deals with directors whom he knows, or is 
supposed to know, to be exceeding their authority, cannot 
complain of them if he finds that their acts are repudiated. 

(I) See on this subject the cases Campbell, 5 App. Ca. p. 952, where 

referred to in the next ten notes, the difficulty of drawing the line 

and Jcnkiiis v. Hutchinson, 13 Q. B. between warranty, fraud, and es- 

744 ; Lewis v. Nicholson, 18 Q. B. toppel is pointed out. See, also, 

503 ; llandellx. Trimen, 18 C. B. 786; Pollock on Contracts, Appendix, 

Gotten v. Wright, 7 E. & B. 301, and note L. ; Holmes on the Com. Law, 

8 ib. 647 ; Simons v. Patchett, 7 ib. 130. 

568 ; Eastwood v. Bain, 3 H. & N. (n) Godwin v. Francis, L. R. 5 C. 

738, where the plaintiff had not sus- P. 295 ; Ferguson v. Wilson, 2 Ch. 

tained damage. As to the measure 77. 

of damages, see Ex parte Panmure, (0) See as to this, ante, p. 165. 

24 Ch. D. 367 ; Meek v. TVendt & Wilson v. Miers, 10 C. B. N. S. 348, 

Co., 21 Q. B. D. 126. was an action against directors for 

(on) See ante Bk. I. c. 3, § 1, and exceeding their authority, but the 

Firbank's exors. v. Humphreys, 18 Q. Court was of opinion that there was 

B. D. 54. See, also, Lord Black- no excess, and decided against the 

burn's observations in Brownlie v. plaintiff on that ground. 

L.C. R 


Bk. II. Chap. 6. He runs the risk of such repudiation. In the absence, there- 
Sect, l. l ' 

- fore, of fraud on their part, such a person will be unable to 

obtain airy redress against them. Moreover, they are not 

liable for honest mistakes as to the legal extent of their 

authority (p). 

Thus, where a person advanced money to a coinpan}- on the 

security of an invalid Lloyd's bond of the company, the 

directors who issued it were held not to be personally liable 

to repay the monej' advanced (q). So where a person bought 

new preference stock of a railway company which both he and 

the directors bond fide believed they had power to issue, but 

which in truth they had not, it was held that he had no 

remedy against them, for there was nothing more than a 

common mistake of law (r). 

Liability for But directors, like other agents, impliedly warrant all facts 

acts ultra . 

vires. necessary to confer the authority which they profess to exer- 

cise. And if the company is governed by a private act of 
Parliament the contents and effect of that act are regarded as 
matters of fact (s). Therefore directors who had accepted 
bills on behalf of a company, which had no power under its 
private acts of Parliament to accept bills, were held liable to 
the holders who had no notice in fact that the company was 
not empowered to accept bills (s). So where a company had 
power to borrow, but the power had been already exhausted, 
and the directors nevertheless raised more money, they were 
held personally liable to repay it (t). So where the directors of a 
benefit building society had power to borrow if a rule enabling 
them to do so had been passed, and they borrowed money for 
the society in the absence of any rule enabling them so to do, 
it was held that they were personally liable to repay it («). So 
where directors of a company authorised the manager to over- 
draw the company's account, they were held liable for the 

(p) Beattie v. Lord Ebury, L. B. v. Kitson, 12 Q. B. D. 157, and 13 

7 Ck. 777, and 7 H. L. 102. Com- Q. B. D. 360. 
• pare the cases in the next four notes. (t) Weeks v. Propert, L. B. 8 C. 

(q) Rashdall v. Ford, 2 Eq. 750. P/427 ; Chapleo v. Brunswick Build- 
See on this ease, 13 Q. B. D. 363. ing Soc, 6 Q. B. D. 696. 

(r) Eaglesfield v. Marquis of Lon- (u) Richardson v. Williamson, L. 

donderry, 4 Ch. D. 693. B. 6 Q. B. 276, explained by Mel- 

(s) West Loudon Commercial Bank lish, L. J., in 7 Ch. 801. 

FOB l; OWN A( I -. 2 18 

over-draft, for although the company had no power to borrow 1;k - "■ Chap- ••• 
without the consent of ;i meeting of shareholders, they had 

power to do so with such consent^ . So where a company had 
power to issue debenture stock to a Limited extent, and the 
directors, niter the power was exhausted, issued more deben- 
ture stock, they were held personally Liable to the holdei - of the 
unauthorised stock. The damages were held to be the value 
which the stock would have had if it had been authorised (>/). 

Further, where a person purports to contract as an agent, Contracts with 

promoters of 

and lie has in truth no principal, so that the contract, unless compan 

binding on the party to it, is wholly void, he is treated as 
having contracted on his own behalf, and is personally Liable 
accordingly. Thus, if a person contracts on hehalf of a com- 
pany not yet formed, he is Liable on that contract ; and he is 
not relieved from such Liability by the subsequent adoption of 
the contract by the company when formed ci ; unless the con- 
tract is so worded as to exclude personal liability. 

Again, if directors contract as principals, which is quite Express personal 
consistent with their acting on behalf of the company (a), they 
will be bound personally by tluir contract provided it is not 
actually illegal. The fact that the contract is one which would 
not bind the company is not p< r se sufficient to render it void 
as against the directors personally. Therefore, where the 
directors of a company disagreed and divided into two parties, 
and one party retired, and the other party covenanted to 
indemnify them, this covenant was held binding on the direc- 
tors who entered into it, irrespectively of the question how far 
the whole transaction was one which the directors had power 
to enter into on the part of the company (b). But if the con- 
tract is illegal no action can be maintained upon it ; and there- 
fore where the directors of a railway company agreed that it 

(as) Cherry v. Col. Bank of A us- and the cases on promissory notes, 

tralasia, L. R. 3 P. C. 24. ante, p. 232 et sea. See, also, Kay v. 

(y) Firbank's exors. v. Humphreys, Johnson, 2 Hem. & M. 118, in which 

18 Q. B. D. 54. a decree for the specific performance 

(;.) Kelner v. Baxter, L. R. 2 C. P. of an agreement for a lease was made 

174 ; Scott v. Lord Ebury, ib. 255. against directors personally. 

(a) McCollin v. Gilpin, 5 Q. B. (b) Haddon v. Ayers, 1 E. & E. 

D. 390, affirmed 6 Q. B. D. 516, 118; Barker v. Allan, 5 H. & N. 

DvMon v. Marsh, L. R, 6 Q. B. 361, 61. 

K 2 


Bk. II. Chap. 6. should pa} r the expenses which might be incurred by another 

company in attempting to obtain an act of Parliament for the 
formation of a line which, when made, was to be handed over 
to the first company, it was held that this was an agreement 
to the effect that the first company should do that which was 
altogether illegal, and that an action against the directors for a 
breach of the agreement could not be sustained (c). 

2. For the acts of each other. 
Directors not the Although the directors of a company are the agents of the 

agents of each G I J & 

other. company, and although, as a member of the company, each of 

the directors is liable for the acts of its agents on the same 
ground as other members, still, unless a director has done 
something to make his co-directors his agents in some other 
sense than this, he is no more liable for their acts than any 
other shareholder. In this respect directors are like pro- 
moters, each being answerable for his own acts and for the 
acts of the others so far as he has made them his agents, but 
no further (d). It must however be borne in mind that the 
liability here referred to is liability to persons dealing with 
directors as representing their company. The duties and 
liabilities of directors to shareholders will be referred to here- 
after in Book III. 


Passing now to the consideration of the personal liabilities 
of shareholders of companies in respect of transactions which 
impose liabilities on the companies of which they are members, 
it is necessary to distinguish one company from another, and 
especially unincorporated from incorporated companies. 

(c) Macgregor v. Dover and Deal case, 4 -De G. M. & G. 411 ; Walker's 
Rail. Co., 18 Q. B. 618. case, 8 De G. M. & G. 607. See, 

(d) See Brown v. Byers, 16 M. & also, Weir v. Barnett, 3 Ex. D. 32 
W; 252 ; Heraud v. Leaf, 5 C. B. and 238 ; Gargill v. Bower, 10 Ch. 
157 ; Bra,,) ah v. Roberts, 3 Bing. D. 502. 

K. C. 963 ; Lord Londesborough's 

/ \u.s r hi i.i \i;ii.u v. 245 

Bk. II. Chap. 6. 
Sect. 2. 

1. As to the > tteni of liability, 
(a.) Of liability at Common Law and of attempt I 

Hy the common law of this country every member of an 
unincorporated partnership, whether it be an ordinary firm or 
a joint-stock company with transferable shari 3, is personally 
liable for nil tin- debts and engagements of the partnership 
contracted whilsl he is a member of it [e). As may be Bup- utemptato 
posed, many attempts have been made from time to time 
to restrict the application of this rule and to form com- 
panies on such terms as to prevent their members from being 
ruined in the event of the companies suffering serious loss. 
These various attempts have ceased to be of much practical 
importance owing to the facilities of forming incorporated 
companies by means of registration; hut they have still greal 
historical interest and deserve notice on that account : more- 
over, there are still insurance companies which issue policies 
on the terms that they are to be paid solely out of the funds 
of the companies. 

The attempts referred to may be ranged under two heads, 
according as there has or has not been some special agreement 
with the creditors. 

So inflexible is the doctrine of unlimited liabilit}', and' so Without special 
important is it that no doubts shall be cast upon it, that judges creditors, 
have frequently denounced in the strongest terms the conduct 
of those who have endeavoured to inveigle the public into 
taking shares in companies by asserting that "no one shall be 
liable beyond the amount of his subscription." Nothing can 
be more delusive or worthless than such statements as applied 
to unincorporated bodies, or to bodies not governed by special 
acts of Parliament ; for although the subscribers themselves 
may stipulate with each other for such a restricted liability, 
nothing is more clear than that, as to the rest of the world, 
each shareholder is liable for the whole amount of the debts of 

(e) Partn., bk. ii. c. 2, and see, as V. & B. 157 ; R. v. Dodd, 9 East, 
to companies, Keasley v. Codd, 2 Car. 516 ; Robinson's Executor's case, 6 De 
& P. 408, note ; Garlen v. Drury, 1 G. M. & G. 572. 


Ck. II. Chap. 6. the company (/). Nor will notice that a stipulation of this 

— kind has been entered into between the shareholders prevent a 

creditor from holding each of them liable to the full extent of 
his demand (//). 
By special con- Notwithstanding, however, this general rule, if a person 
tors. V ' 1 l c> ' chooses to deal with a company upon the terms that its funds, 
and they only, shall be available to make good his demands, 
he cannot afterwards depart from those terms and hold the 
members individually liable as if no such restriction had been 
agreed to (h). 

It is, however, to be borne in mind, that members of unin- 
corporated companies, like other partners who contend un- 
restricted liability, have the onus probandi on themselves, and 
if, owing to any circumstance, they fail in establishing their 
contention, the general rule of unlimited liability applies to 
them as a matter of course (i). 
Limiting liability The ordinary mode of restricting liability, is to contract 

to funds of com- ^ ^ ^^ q£ ^ company shaU alone be Hable to the 

demands against [it. Upon contracts in this form, it is to be 
observed that — 

1. A contract by a person to pay out of his own property 
without limitation, is in fact an absolute contract to pay ; for 
expressio coram qua tacite insunt nihil operatur. 

2. Upon the same principle, a contract by a corporation to 
pay out of its funds generally is, as regards the corporation, 
neither more nor less than a contract to pay absolutely ; for 
a corporation as such has nothing except its funds to pay 
out of (k) . 

3. An express contract to pay out of certain specified 

(/) See B. v. Dodd, 9 East, 516, judgment on the bill of exceptions) ; 

and the cases in the last note and Durham's case, 4 K. & J. 517. 

the next. (t) See Luckombe v. Ashton, 

(g) See Greenwood's case, 3 De G. 2 Fos. & Fin. 705, and ante, 

M. & G. 459. The State Fire Ins. note (g). 

Co., Meredith's case, and Conver's (/.:) Sunderland Marine Insur. Co. 

case, 1 N. R. 510, V.-C. W. v. Kearney, 16 Q. B. 925, in which 

(h) Alchorne v. Saville, 6 Moo. the liability of the individual mem- 

202 ; Halket v. The Merchant bers of the company was not in 

Traders' Loan Assoc, 13 Q. B. 960 ; question. 
Hallett v. Dowdall, 18 Q. B. 2 (the 



funds, excludes an implied contract to pay in some ■ -t h»-r l;; ■ n Chap. ''■ 

1 l ■ b. 2. 

manner (J). 

-1. Bnl ;i person who undertakes to pay out of certain funds, 
is absolutely bound to pay it' those funds exist and are avail- 
able; so thai it', tin' funds existing and being available, he 
docs not choose to pay out of them, he must pay out of liis 

own property | m I. 

5. On the other hand, a person who undertakes to payout 
of certain funds, is under no obligation to pay unless those 
funds exist (n), or unless their non-existence is owing to his 
own default (o), or unless he has also undertaken that they 
shall exist ; in which last case his undertaking to pay amounts 
to an absolute undertaking, and the qualification as to the 
funds goes for nothing (}>). 

En conformity with these principles, it has been held that Success of 
the promoters of a company are not Liable to persons i mployed limit liability, 
by them upon the terms that such pi rsons shall look for pay- 
ment to certain specified funds, and not to the promoters 
individually (</) ; that upon a contract to pay out of the funds 
of a joint-stock company, all those who in point of law are 
bound by the contract, are personally liable to satisfy the 

(/) See Alexander v. Wormeen, 6 
H. & N. 100 ; Giles v. Smith, 11 
Jur. 334, C. P. ; Landman v. En- 
twistle, 7 Ex. 632 ; Mathew v. Black- 
more, 1 H. & N. 702 ; Taft v. 
Harrison, 10 Ha. 489. Compare 
Cope's case, 1 Sim. N. S. 54. 

(;») Higgins v. Hopkins, 3 Ex. 
163 ; Haildt v. Dowdall, 18 Q. B. 
2. But if an incorporated company 
promises to pay out of its funds 
only, anil it lias funds, it does not 
follow that the shareholders are 
personally liahle, Re the Athenaeum 
Society, and Prince of Wales Society, 
Johns. 80, affirmed 3 De G. & J. 

(») The Statute of Limitations 
does not begin to run until they do 
exist. See in re Kensington Station 
act, 20 Eq. 197. 

(o) As in Mclntyre v. Belcher, 14 

( '. B. N. S. 65 1. where the defendanl 

discontinued the business, out of 
the profits of which he was to pay 
the plaintiff. See, also, Telegraph 
Despatch Go. v. McLean, 8 Ch. 658 ; 
Worihington v. Sudlow, 2 B. & Sm. 
508. [Compare King v. Accumulative 
Ass. Co., 3 C. B. X. S. 151 ; Rhodes 
v. Forwood, 1 App. Ca. 256 ; Rail- 
v<tij and Electric Appliances Co., 38 
Ch. D. 597, noticed infra, p. 249, 
note (a). 

{p) See Pilhrow v. Pilbrow's At- 
mospheric Co., 5 C. B. 440. 

(q) Giles v. Smith, 11 Jur. 334, 

C. P. ; Landman v. Enticistle, 7 Ex. 
632. Compare Cope's case, 1 Sim. 
N. S. 54 ; GuUen v. Duke of Queens- 
berry, 1 Bro. C. C. 101, and Horslcy 
v. Bell, ib. in the note ; S. C. 2 Am. 
770 ; Williams v. Hathaway, 6 Ch. 

D. 544. 

Hancock r. 


Bk. II. Ciap. 6. demands to which those funds are applicable, if any such funds 
— — there be (r) ; but that if there are no such funds, then the 

event on which alone payment has to be made not having 

arisen, no one is liable to pa}^ (s). 
Failure of at- ^he latter proposition, however, supposes that the contract 

tempt where . 

contract is not is not so framed as (notwithstanding what is said about the 
funds of the company) to amount to an undertaking to pay at 
all events. The importance of attending to this point appears 
from Hancock v. Hodgson (t). In that case, the projectors 
of a mining company purchased a copper and tin mine, and 
covenanted to pay the purchase money by quarterly instal- 
ments out of the funds of the company ; but it was provided 
that in case there should not have been received by the 
bankers of the company or by the directors for the time being, 
the deposits or instalments due from the several shareholders, 
so as to enable the directors to pay the purchase money at the 
times therein before mentioned, then and in such case the said 
directors shall be allowed a further time to pay such balance, 
until six months after the time or times when the said quar- 
terly instalments became due. Upon this covenant and 
proviso it was held, that the covenantors were personally liable 
to pay the whole purchase moneys, although the company had 
no funds ; for that whatever might have been the case without 
the proviso, that clearly showed that after the expiration of the 
further period therein mentioned, the payment was to be made 
by the covenantors at all events, whether the company had 
funds or not. 

Having made the above general observations, it is necessary 
to examine with greater particularity the effect of contracts by 
companies to pay out of particular funds, on 

1. The rights of creditors against the funds themselves; 

(?•) See Andrews v. Ellison, 6 B. Loan and Insurance Association, 13 

Moore, 19!) ; Gurney v. Rawlins, 2 Q. B. 960 ; Hassell v. Ditto, 4 Ex. 

M. & W. 87 ; Bauson v. Wrench, 3 523 ; The Worcester Com Exchange 

Ex. 359 ; Reid v. Allan, 4 Ex. 32G ; Co., 3 De G. M. & G. 180 ; King v. 

llallett v. Dowdall, 18 Q. B. 2, the The Accumulative Assurance Co., 3 

judgment on demurrer. C. B. N. S. 151 ; and compare Cope's 

(s) See, in addition to the above case, 1 Sm. N. S. 54. 
cases, Durham's case, 4 K. & J. 517 ; (0 4 Bing. 269. 

Hailed v. The Merchant Traders' 


and 2. Their rights againsl the members individually where Bk - IL Cba P- 6 - 

those funds have been exhausted. 

1. With respeel to the rights of creditors against the funds, Right against 
it may now be considered as settled, thai a contract by a com- 
pany to paya person out of its funds does not give the creditor 
any specific charge or lien on those funds, nor any preference 
over other creditors (//) ; hut it nevertheless entitles him, even 
before the time for payment arrives, to prevent the funds from 
being misapplied (x). Where therefore an insurance company 
had issued policies and mad.' them payable out of its funds, a 
policy holder whose policy had not become payable was laid 
entitled to an injunction to restrain the company from amal- 
gating with and transferring its funds to another company, 
such amalgamation and transfer not being warranted by the 
deed of settlement of the first company (y). Jt has, however, 
been held o thai a contract to pay a policy out of particular 
funds does not amount to a contract to carry on business, nor 
to a contract not to hand over the muds to other persons (a) ; 
and that a policy holder whose policy is not due cannot sup- 
port an action for damages which he fears he will sustain, but 
which possibly he will not. The last ground is perhaps the 
most satisfactory, and has the advantage of rendering the de- 
cision in equity consistent with that at law. 

It is, however, by no means uncommon for an unlimited Wliere the com - 

,. . . ,. , ... I'.tnv has power 

insurance company to limit its liability to policy holders and to transfer its 
annuitants to its funds, and to have in its deed of settlement f '"" ls ' 

(u) A Ibcrt Life Ass. Co., 9 Eq. 706 ; 571. 

Mclver's claim, 5 Ch. 424, and the (z) King v. Accumulative Life 

cases in the next note. Assur. Co., 3 C. B. X. S. 151. See 

(.<■) See Kearns v. Leaf, 1 Hem. & also, Lefhhridgex. Adams, 13 Eq. 547. 

M. 681 ; State Fire Insur. Co., (a) See, also, llhodes v. Foncood, 

ib. 457, and 1 De G. J. & Sm. 634 ; 1 App. Ga. 256, where an agent of a 

Athenceum Life Insurance Society, colliery contended in vain that his 

Johns. 80 & 633, and 3 De G. & J. employer was bound to carry it on. 

660 ; Law v. London Indisputable So in Re Railway and Electric Ap- 

Life Policy Co., 1 K. & J. 223. These pliances Co., 38 Ch. D. 597, there was 

cases will be adverted to hereafter, no implied covenant to carry on 

when the winding up of companies business in order to work a patent, 

is being considered. Compare Telegraph Despatch Co. v. 

(y) Kearns v. Leaf, 1 Hem. & M. McLean, 8 Ch. 658, and Mclntyre v. 

861 ; Aldebert v. Leaf, ib. Compare Belcher, 14 C. B. N. S. 654, noticed 

Argus Life Ass. Society, 39 Ch. D. ante, p. 247, note (o). 



Extent of mem- 
bers' liability. 

(a) Where the 
company is 

Bk. II. chap. 6. or articles of association as originally framed, or as altered in 

Sect. 2. . . 

- accordance with a power therein contained, power to transfer 
its funds and its business to another company. Where this 
occurs, a transfer of the funds cannot be prevented ; and upon 
a proper transfer being made and in the case of life insurance 
companies confirmed bj r the Court, the policy holders and 
annuitants cease to have any claims against the transferring 
company (b). 

2. "With respect to the extent of the liability of the members 
of a company upon contracts in which it is specially stipulated 
that the funds of the company alone shall be answerable, and 
that no member shall be liable beyond the amount of his share, 
the limit set by contract is the limit of liability : — 

"Where the company is an incorporated compairv, there never 
was any difficulty in giving effect even at law to all the terms 
of the contract ; and in the case of companies registered under 
the act 7 & 8 Vict. c. 110, it was held that the members were 
not liable to have execution issued against them upon judg- 
ments obtained against the compan}' on a contract of the 
description in question ; but that the property of the company 
was alone liable to make good the demands of the judgment 
creditor ; and this was held at law even in cases where the 
subscribed capital had been exhausted but the whole capital 
had not been paid up (c) . 

The same principle was acted on in equity, except that a 
Court of equity compelled the shareholders to pay up rateably so 
much of the capital as had not already been subscribed (d). 
This can now be done by a properly constituted action. 

In all these cases, however, it must be borne in mind that 
the liabilities which are limited to the funds of the company, 
are those only which are expressly so limited by the contracts 

(6)* See infra, § 3, p. 258, &c, and 
as to life assurance companies, see 
The Life Assurance Companies act, 
1870, 33 & 34 Vict. c. 61, § 14. 

(r) Hailed v. The Merchant Tra- 
ders' Loan and Insurance Assoc, 13 
Q. B. 960 ; Hassell v. The Same, 4 Ex. 
525 ; Durham's case. 4 K. & J. 517 ; 

lie the AtlienoBwm Life Soc, Johns. 
80, and 3 De G. & J. 660, on appeal ; 
Lethbridge v. Adams, 13 Eq. 547. 

(d)' Talbot's case, 5 De G. & Sni. 
386 ; Durham's case, 4 K. & J. 517 ; 
Evans v. Coventry, 8 De G. M. & G. 
835. See clause 7 of the decree. 

I.I \l:ll.I'I V LIMITED BY BTA1 ri E. 251 

with the creditors: the Liabilities to other persons are un- |;! ■ n - '' 1m i'- ,; - 
limited (e). 

Companies governed by the Companies act, 1802, may, Com] 
although unlimited, limit their liability by special contract \J >, a i of L862. 
and where they do so the principles above adverted to will be 
applicable. But as under the < lompanies act, 1862, judgments 
against a company cannot be enforced against its members, 
questions as to their individual liability can scarcely arise 
except when a company is being wound up. 

As regards unincorporated companies, it was extremely dif- (&) Wherethe 

i • r • -i i i i • c i -r i- coiniauv is not 

iicult, li not impossible, before the passing ot the Judicature incorporated. 
Acts, to enforce by action at law a contract limiting their 
liability to their funds (y). It was practically necessary to sue 
in equity. But now it is apprehended thai an action can be 
maintained against the persons having the control of the funds 
and the persons liable to contribute to them, to enforce the 
liability to contribute, and the due application of the funds 
when raised (/<). 

(/».) of limit*, 1 liability by Statute. 

Passing now to the subject of limited liability by statute, Limited lil,,ili y 
. . ' . ' b J statute, 

the first point which lias to be borne in mind is that the 

moment a society of any kind is incorporated, its members 

cease by common law to be in an} r way liable for the debts and 

engagements of the body corporate. Moreover, although by 

common law it has always been lawful for the Crown to create 

corporations, the Crown has no power by common law to create 

a corporation and at the same time to render its members indi- 

(e) See the Albert Life Ass. Co., 9 this treatise, but it has not been 

Eq. 706 ; Professional Life Ass. Co., thought necessary to reproduce the 

3 Eq. 66S, and 3 Ch. 167 ; Lcthbridge former observations on it. 
v. Adams, 13 Eq. 547. (h) See Law v. The London In- 

(/) See § 38, cl. 6, Accidental disputable Life Policy Co., 1 K. & 

Death Ins. Co., 7 Ch. D. 568. J. 223 ; Talbot's case, 5 De G. & Sm. 

((/) See Hallett v. DowdaU, 18 Q. 386 ; Durham's case, 4 K. & J. 517 ; 

B. 2, and the observations of Mellish, Robson v. McCreight, 25 Beav. 272 ; 

L. J., in Crain's case, 1 Ch. D. 322 ; Evans v. Coventry, 8 De G. M. & 

Alchorne v. Saville, 6 B. Moore, 202, G. 835. See, as to the effect of a 

note. Hallett v. DowdaU was noticed transfer by the company of its busi- 

at length in the earlier editions of ness, Hart's case, 1 Ch. D. 307. 



Bk. II. Chap. 6. 
Sect. 2.' 

Chartered com- 

Companies go- 
verned by 8 & 9 
Vict. c. 16. 

Companies em- 
powered to sue 
and be sued. 

Banking com- 
panies governed 
by 7 Geo. 4, 
c. 46. 

Companies act, 

vidually liable for its debts (/), the whole of that branch of 
the law which relates to the liability, as distinguished from 
the non-liability, of the members of incorporated companies 
for the debts and engagements of such companies, is of modern 
growth and is based upon statutory enactments. These enact- 
ments will be examined hereafter in connection with the 
subjects of execution and winding up, but it may be useful to 
state generally in the present place that — 

1. The liability of the members of a company governed by 
the Letters Patent act depends on the terms of its charter or 
letters patent, the Crown being empowered by the act in ques- 
tion to limit their liability or not. (See 7 Will. 4 and 1 Vict. 
c. 73, §§ 4 & 29.) 

2. The liability of the members of a company governed by 
the Companies clauses consolidation act is limited to the 
extent of their unpaid-up shares in the capital of the company 
(8 & 9 Vict. c. 1G, § 36). 

3. The liability of the members of a company empowered by 
a special act of Parliament to sue and be sued by a public 
officer depends on the terms of such act, but will almost inva- 
riably be found to be unlimited (k). 

4. The liability of the members of a banking company 
governed by 7 Geo. 4, c. 46, is unlimited. (See 7 Geo. 4, 
c. 46, §§ 11, 12, 13.) 

5. Subject to the exceptions presently to be noticed, the 
extent of the liability of the members of a company formed 
and registered under the Companies act, 1862, depends upon 
whether the company is registered with limited liability or not. 
If the company is registered with limited liability, its members 
are not liable beyond the amount for which they have under- 
taken to be responsible ; but if the company is not so regis- 
tered, its members are liable to the full amount of the com- 

(i) This power was conferred upon 
the Crown by 6 Geo. 4, c. 91, § 2, 
which was followed by 4 & 5 Will. 
4, c. 94, and was with it repealed 
and replaced by 7 Will. 4 eS: 1 Vict. 
c. 73. 

(k) See Aldridge v. Cato, L. R. 4 
P. C. 313, as to the liability of a 

member of a company empowered 
to sue and be sued, but not incor- 
porated. The Colonial ordinance in 
that case was held not to have in- 
corporated the company, and the 
case may be usefully referred to on 
the construction of such documents. 


pony's debts and engagements, whatever that may be (/>. The l;L n (| "i'- ,; - 
liability, however, of each member i-* merely ;i liability t" 

contribute with others; and such liability can only be en- 
forced by winding up the company. No execution can issue 
against a member upon a judgment obtained against the 

The exceptions above referred to are ;i^ follows : — tjonal 

/i \ -n •/• 1 • • 1 • • i • •!• liabilities. 

(1.) hiven it the company is registered with limited liability, 
the liability of the directors will be unlimited it' the memo- 
randum of association so provides (/«). 

(2.) If a company carries on business for six months with 
less than seven members, all the members cognisant of the fact 
are severally liable for the debts contracted by the company 
during that time, and may be sued accordingly (n). 

(3.) The act contains stringent provisions to compel limited 
companies and their officers to use the word " limited " as part 
of the name of the company in matters relating to its busi- 
ness (o) ; and persons signing or authorising the signature on 
behalf of such a company of any bill of exchange, promissory 
note, cheque, or order for money or goods, in which the word 
limited is not used as directed, are themselves liable for the 
amount, unless the same is duly paid by the company (p). 

(4.) The liability of limited banking companies issuing 
notes is unlimited in respect of such notes (q). 

(5.) Although a company may be registered without limited 
liabilit}', the liability of its members may be limited by special 
contract (r). 

(6.) The liability of the members of companies not formed Companies re-is- 

.,,'.. tered but not 

under the act but registered under it, is as to all matters formed under 
occurring after registration the same as the liability of mem- 
bers of companies formed and registered under the act. But 
as to other matters the extent of liability is the same as if no 
registration had taken place (s). Existing companies with 

(0 See 25 & 26 Vict. c. 89, § 38. (3) 42 & 43 Vict. c. 76, § 6. 

(m) 30 & 31 Vict. c. 131, §§ 4 (r) 25 & 26 Vict. c. 89, § 38, cl. 6. 

and 5. (s) See §§ 179 and 196, cl. 5. The 

(n) 25 & 26 Yict. c. 89, § 48. liability under the repealed act of 

(0) §§ 41 and 42. 7 & 8 Vict. c. 110, was unlimited ; 

(p) § 42. See Penrose v. Martyr, see § 25. So was the liability under 

E. B. & E. 499. the repealed act 7 & 8 Vict. c. 113 ; 



Bk. II. Chap. 6. unlimited liability, whether registered as such under the act of 

fcGCt, A, u 

1862 or not, may be registered as limited companies, and if 

so registered, the liabilitiy of their members as to matters 
occurring after registration becomes limited also (t). But 
banking companies existing at the date of the passing of the 
act and registering under it as limited companies, are bound 
to give certain notices to their customers before the privilege 
of limited liability can be claimed as against them (»). 

of shareholders' 

2. As to the duration of liability, 
(a.) Commencement of liability. 

In ordinary partnerships a person who joins a firm does not 
become liable to its existing creditors simply by the act of 
joining it, although he may have been admitted into partner- 
ship upon the terms that as between him and his co-partners 
he shall contribute to the existing debts of the firm (x). The 
same rule applies to the members of unincorporated companies 
when there is no statutory provision to the contrary. There- 
fore, where a creditor sued a shareholder in a cost-book mining 
company for goods supplied to the company before the de- 
fendant became a shareholder, the creditor was held not 
entitled to recover (y). 

When, however, a person takes shares in a company, he, as 
between himself and other shareholders, takes those shares 
with all the rights and liabilities attaching to them, so that 
his co-shareholders have a perfect right to insist upon his 
contributing with them towards the liquidation of debts con- 
tracted before he joined the company (z). And even as regards 

see § 7. The liability under the acts 
of 1856 and 1857 was substantially 
the same as that under the Com- 
panies act, 1862. 

(t) See §§ 179, 180, and 42 & 43 
Vict. c. 76, §§ 4 & 5. 

(«) See § 188. 

(x) Partn., bk. ii., c. 2, § 3, p. 201, 
et sec[. 

(y) Thomas v. Clarke, 18 C. B. 
662. See, too, Thomas v. Holler, 4 

De G. F. & J. 199. 

(z) Taylor v. Ifill, 1 N. R. 566, 
V.-C W. ; Cape's Executor's case, 2 
De G. M. & G. 562 ; Mayhew's case, 
5 ib. 837. See, too, Horsley v. Bell, 
1 Bro. C. C. 101, note. Sanderson's 
case, 3 De G. & S. 66, contra, cannot 
be regarded as correct on this point. 
See Henderson v. Sanderson, 3 H. 
L. C. 698. 


creditors, the liability of a shareholder to them seldom depends Bk - 'J;' 1 '.:''• { ' K 
npoii the ordinary principles of partnership law ; for most com- - 
panics are governed by statutory enactments, which must not 
be overlooked. These enactments will be examined hereafter, 

but it may be stated generally, that in all companies regulated 
by 7 Geo. 4, c. 46, by 8 & 'J Vict. c. 1G, or by the Companies 
act, 18G2, an incoming shareholder is, so long as he remains a 
shareholder, liable to creditors in respect of debts incurred by 
the company before he became a shareholder ("). The Letters 
Patent act (7 Will. 4 and 1 Vict. c. 73, § 24) is so worded as 
to be capable of receiving a different construction in this 
respect; but probably a different construction would not be 
put upon it; for it would be highly inconvenient to apply 
different principles to different companies if it can be avoided, 
and there certainly is no sufficient reason for any distinction 
between them with reference to the liability alluded to (l>). 

(b.) Termination of liability. 

A member of an ordinary partnership may, even during the ] - T?'"^"^." 

continuation of the partnership, determine the authority of his liability in re- 

• • • / \ mi • • fc P ect °f f utuie 

co-partners to bind him, by giving proper notice (c). lhis is, :i , .. s . 

in truth, only an instance of the more general proposition, 
that an agent's authority is determinable by his principal at 
any time before the authority has been acted on. But as the 
directors of an incorporated company are the agents of the 
company, and not of the individual members, a notice by one 
of them to the effect that he will not be responsible for the 
future acts of its directors, would, it is conceived, be simply 
inoperative. As regards incorporated companies, the only 
mode in which a shareholder can escape liability for future 
acts of the directors is by duly severing his connection with 
the conrpairy. 

"When a shareholder ceases to be such, he obviously deter- 
mines the authority conferred by himself upon the company 

(«) The same was true of com- tended to be raised in Philipson v. 

panies governed by the repealed Egremont, 6 Q. B. 587, but it was 

acts, 7 & 8 Vict. cc. 110 and 113, not decided. 

and the Joint Stock Companies acts, (c) Partn., bk. ii., c. 2, § 3, p. 210, 

1856 and 1857. et seq. 

(b) This point was apparently in- 


Ek. II. Chap. 6. and its agents to bind him. If lie is a shareholder in a corn- 
Sect. 2. 
pany which has no register of its members accessible to the 

public, he is in the position of a dormant partner, and conse- 
quently he cannot be made liable for what occurs after his re- 
tirement ; and no notice of retirement is necessary except to 
Effect of continu- those who knew him to be a shareholder^?). But a person 
mg on register. w j 1Q ^ g a s i iare i 10 l c i er j n a company which has a register of its 

members accessible to the public, is prima facie in a different 
position ; and reasoning from analog}', a retiring shareholder 
ought in such a case to take care to have his name removed 
from the register, for so long as it is there he holds himself 
Statutes must out as a shareholder (e). But here, as in other cases, the 
be looked to. liability of shareholders turns on the statutes applicable to the 
companies in which they are shareholders, and reliance 
must not be placed upon the general principles applicable to 

The Letters Patent act expressly enacts that a person ceas- 
ing to be a shareholder in a company to which that act applies, 
shall for all purposes of liability be considered as a continuing 
shareholder until the fact that he is not so has been regis- 
tered (/). But as regards companies governed by other 
statutes, it will be found that their liability for future debts 
depends not so much on what appears from the company's 
register, as on the fact of membership, of which the register is 
only prima facie evidence (g). 
T ■ 'n tion Again, with respect to the liability of a late shareholder in a 
of shareholders' com p an y for those debts and engagements of the company to 

liability in re- r . . . 

spect of past which he was liable when he was a shareholder, it is necessary 
to consult the statute or charter by which the company in 
question is governed. Without referring to particular enact- 
ments at length, it may be stated generally that the ordinary 

(d) See, Ace. Northey v. Johnson, Birch's case, 2 De G. & J. 10 ; Loft- 
19 L. T., 104 Q. B. 1852, the case of house's case, ib. 69 ; Powis v. Butler, 
a shareholder in a cost-hook mine. 4 C. B. N. S. 469, affirming S. C, 3 

(e) This is consistent with the ib. 645. See, also, Partn., p. 40 etseq. 
cases which show that a person (/) 7 Will. 4 & 1 Vict. c. 73, § 
whose name is put on a register of 21. 

shareholders without his authority (//) See the section in the next 

does not hold himself out as a share- chapter on Execution against Corn- 
holder. See Lyster's case, 4 Ecp 233 ; panies and their Shareholders. 


principles of partnership and corporation law have not been Bk - ?M 31l § p- 6 * 
materially departed from in 1 1 j * - case of companies, i xc< pi as 
regards time (h). 

The Joint-stock banking act, 7 Geo. I, c. 16, L 8, contains Summary of 
provisions continuing the liability of shareholders in respect of 
pasl debts until the lapse of three years after they had c< asecl 
to be shareholders 

The Letti rs Patenl act, 7 Wm. 1 & 1 Vict. c. 73, § 24, con- 
tinues tin- liabilities of late shareholders, but it does nol con- 
tain any provisiou limiting the duration of such liabiliti 

The Companies clauses consolidation aci contains no pro- 
vision continuing the liability of a shareholder, after he has 
ceased to be such (8 & !) Vict. c. I<>, § 86). 

The liability of shareholders in a company formed under the 
Companies act, 1802, is continued, as to debts contracted he- 
fore their retirement, for one year alter they have ceased to 
hold shares (25 & 26 Vict. c. 89, § 38). 

The liahilitv of a retired shareholder to contribute to the Liability to con- 

r i i • i i • i- i i- tribute ii 

(lehts oi a company must not be confounded witn his liability confounded with 
to creditors. For notwithstanding the continuance of his ^itore. 
liahilitv to creditors, he may be entitled to a complete in- 
demnity from the other shareholders, and may not therefore 
be a contributory with them, and this is a common case. On 
the other hand, a shareholder may he freed from liahilitv to 
creditors, but not he freed from liability to the other share- 
holders, to contribute with them to the payment of debts for 
which they only are directly liable. This, although not so 
common a case as the other, is still a possible case, and affords 
a striking illustration of the difference (constantly lost sight 
of by non-lawyers) between direct and indirect liability to the 
debts of a company (k). This subject will be examined here- 

(h) See, as to partners, Part., bk. for debts contracted whilst lie was 

ii., c. 2, § 3, pp. 223 et seq. a shareholder. The act of 1856 

(i) The repealed acts, 7 & 8 Yict. rendered him liable for debts con- 

c. 110, § 66; c. 113, § 10; and 19 traded before he became a share- 

& 20 Vict. c. 47, § 62, as to un- holder, and whilst he continued to 

limited companies, contained similar be so. 

provisions. But the 7 Geo. 4, c. 46, (k) See Ex parte Gouthicaite, 3 

and 7 & 8 Vict. c. 110, and c. 113, Mac. & G. 187. 
only render a late shareholder liable 

L.C. s 


Bk. II. Chap. 6. 

Sect. 2. 

3. On the commencement and termination of liability in the 

case of amalgamating companies. 

Commencement The position of a company which amalgamates with another 
of liability. 

by agreement is analogous to that of a man who enters into 

partnership with another. As the two partners do not become 
jointly liable to their respective separate creditors, and neither 
partner becomes liable to the debts of his co-partner, so the 
two companies do not become jointly liable for each other's 
engagements, nor do the shareholders in the one company 
become debtors to the creditors of the other company. If the 
agreement to amalgamate is valid, it will bind the two com- 
panies as between themselves ; but such an agreement will not 
per se give the creditors of either any locus standi against the 
other : and if the agreement to amalgamate is ultra vires and 
invalid as between the two companies, securities given by one 
company in respect of the debts of the other will be invalid 
also (I). 

Where companies are amalgamated by statute, special provi- 
sion is always made with respect to these matters. 

The principle of Edwards v. The Grand Junction Railway 
Co. (m) applies to the case of two companies amalgamating. 
The amalgamating company will not be allowed to exercise 
powers acquired by means of agreements with its component 
companies or their projectors, except upon the terms of com- 
plying with those agreements, provided they are such as the 
amalgamated company would itself have been bound by if it 
had entered into them (n). 

(I) See Partn. pp. 239 et seq., the two companies contained an express 

Era Ass. Co., 2 J. & H. 400, and the provision on the subject. 

Saxon Assurance Society, 2 J. & H. (m) Ante, p. 150. 

408, and Ernest v. Nicholls, 6 H. L. (■«) See The Earl of Lindsey v. 

C. 401. As to the effect of amalga- Great Northern Rail. Co., 10 Ha. 

niation in discharging sureties, see 664 ; Preston v. Liverpool and Man- 

The Eastern Union Rail. Co. v. Chester Rail. Co., 1 Sim. N. S. 586, 

Cochrane, 9 Ex. 197, and The London, on demurrer ; Stanley v. Chester and 

Brighton, and South Coast Rail. Co. Birkenhead Rail. Co., 9 Sim. 264, 

v. Goodwin, 3 Ex. 320. In these and 3 M. & Cr. 773. See, also, 

cases the surety was not discharged ; Port of London Assur. Co.'s case, 5 

but the statute amalgamating the De G. M. & G. 465, reversed in 6 


Partners cannot get rid of their Liabilities to creditors by v,k - I! - Cha P- ,; - 

; 2. 
retiring from the firm (o) ; and it is wholly immaterial whether 

all retire, bo as to put an end to the firm altogether, or whether liability. 

some only retire; the principle in each case being that a 

creditor is not affected by agreements come to between his 

debtors.. Precisely the same principle renders it impossible 

for the members of a company to get rid of their liabilities as 

between themselves and thi ir creditors, by simply agreeing to 

dissolve, or by transferring their rights and (so far as they can) 

their liabilities to some other company. Although, therefore, Amalgamating 

' ...... com; 

a company may have transferred all its :i jets and liabilities to 
another company, the transferring company will still remain 
liable to those of its creditors who have not expressly or im- 
pliedly released it from their claims (p). What amounts to an 
implied release is often very dillicult to determine; nor are all 
the cases on the subject easy to reconcile (q). 

In the first place, holders of policies of insurance must not ''" i!;on of 

be confounded with ordinary creditors. The holder of a sub- 
sisting policy is not a creditor at all ; and in order that he may 
become a creditor of the company which issued the policy, he 
must keep up his policy with the company, and the event in- 
sured against must happen whilst the policy is so kept up. 
Consequently it was held in many cases that if an insurance 
office had transferred its business to another company, a 
holder of a policy who had notice of the transfer and who paid 
his future premium to the new office, ought to be treated as 
having agreed to accept the new office in lieu of the old ; and 
unless this inference could be rebutted lie was held to have 
discharged the old office. The following cases illustrate 
this : — 

H. L. C. 401, sub nom. Ernest v. was a member of both companies. 

Nicholls on the ground that the (q) As pointed out by Lord 

amalgamation was altogether in- Hatherley,[in .Ee The Family Endow- 

valid. matt Soc, 5 Ch, 118, see p. 133, 

(o) Part. 223 et seq. clear proof is recpured to show that 

(})) See, in addition to the cases a person having a claim against one 

cited below, Hardinge v. Webster, 1 company on a written contract has 

Dr. & Sm. 101, in which the ere- abandoned it for a claim against 

ditor was a member of the trans- another company which it may be 

ferring company, and the defendant difficult to prove. 


Bk. II. Chap. 6. A. Original company held to be discharged. 

fecct. z. 
(a) The original having had, by its deed of settlement, express 

power to transfer its bnsiness, and the policies having been 

issued subject to this power. 

Hort's case, 1 Ch. D. 307. 

Grairfs case, ib. 

Harman's case, ib. 326. 

Cocker's case, 3 Ch. D. 1. 

Dowsers case, ib. 384. A case of an annuity. 

(b) The policy-holder having accepted the new office after notice 
of the transfer. 

National Provincial Life Ass. Soc, 9 Eq. 306. 
International, &c, Life Ass. Soc, 9 Eq. 316. 
Merchants' and Tradesmen's Ass. Soc, 9 Eq. 694. 
Times Life Ass. Soc, 5 Ch. 381. 
Anchor Ass. Co., 5 Ch. 632. 
Spencer's case, 6 Ch. 362. 
Fleming's case, 6 Ch. 393. 
Evens' claim, 16 Eq. 354. 
Miller's case, 3 Ch. D. 391. 

B. Original company held not to be discharged. 

(a) The policy-holder having had no sufficient notice of the 

Manchester and London Life Ass., 9 Eq. 643, and 

5 Ch. 640. 
Conquest's case, 1 Ch. D. 334. 

(I) The policy-holder having refused to accept the new company. 
Griffith's case, 6 Ch. 374. 

35 & 36 Yict. In order, however, to remove the difficulty of determining in 

41, § 7. 

these cases whether a policy-holder has or has not released the 
old office, it has been enacted by 35 & 36 Vict. c. 41, § 7, as 
follows : — 

§ 7. Where a company, either before or after the passing of this act, has 
transferred its business to or been amalgamated with another company, 
no policy-holder in the first-mentioned company, who shall pay to the 
other company the premiums accruing due in respect of his policy, shall 
by reason of any such payment made after the passing of this act, or by 
reason of any other act done after the passiug of this act, be deemed to 
have abandoned any claim which he would have had against the first- 
mentioned company on due payment of premiums to such company, or to 
have accepted in lieu thereof the liability of the other company, unless 
such abandonment and acceptance have been signified by some writing 
signed by him or by his agent lawfully authorised. 

in i •■ m \ i r... i 0MP4 II-. 261 

lint even in the case of policy-holders who have apparently I;k - j£ r| '';i'- °- 

accepted the new office, in lieu of the old, if it should appear 

that the amalgamation was ultra vires so thai the new com- 
pany is not Liable to pay the policy, the old office will not be 
discharged (1 1. 

As regards persons who arc actually creditors of the trans- Actnal cred 
ferring company, they arc qo! held to have released their ori- 
ginal debtor simply by receiving payments from the new 
companj and giving receipts to it(«); there must be some 
clear and distinct agreement to accept the new company as 
the debtor in lieu of the old ; and where an annuitant who 
knew of the amalgamation had done nothing more than for 
several years receive his annuity from the new company and 
give receipts to it, the Court held that he had not ceased to be 
a creditor of the old company (t). But creditors whose claims 
are limited to the funds of a company which has power to 
transfer those funds and its business, lose their rights against 
the company alter it has transferred its funds and business to 
another (u). 

The amalgamation of Life Insurance Companies is now 33 & 34 Vict. 

c 61 

regulated by 33 & 3-4 Vict. c. 61, § 14, which prohibits 
amalgamation otherwise than by an order of the High Court 
to be obtained as there mentioned (r). 

(r) See 7.V Saxon Lift . ! partt Gibson, 4 Ch. 662, where there 

Society; 27c Anchor's case, 2 J. & H. wa . but a refusal to accept 

408, and on appeal, 1 De G. J. <& the new company. 
Sm. 29. (/) Family Endowment Society, 5 

(s) India and London Life Ass. Ch. 118; Nat. I'rov. Life Ass. Soc, 

Co. 7 Ch. 651, a case of an annuitant ; 9 Eq. 306. 

Commercial Bank Corp. of India (u) Dowses case, 3 Ch. D. 384. 

and the East, 16 W. R. 958, where (v) See Re Argus Life Ins. Co., 39 

there was no sufficient notice of the Ch. D. 571. 
transfer of the business ; and see Ex 




Bk. II. Chap. 7. 

Sect. 4. 

General obser- 


In order to complete the subjects discussed in the preceding 
chapters it is necessary to examine the remedies by which the 
obligations and liabilities already alluded to can be enforced. 

The remedies which alone are of sufficient importance to 
require consideration in a treatise like the present are actions, 
defences by way of set-off, proceedings to enforce judgments, 
and proceedings to wind up companies. The subject of wind- 
ing up will be discussed hereafter, and the present chapter will 
be confined to actions, set-off, and execution. 

Actions by 
and against 


1. Incorporated companies. 

An incorporated company, whether it is incorporated by 
charter, special act of Parliament, or registration, must sue 
and be sued by its corporate name (a) ; and as a general rule 
an incorporated company cannot sue or be sued in respect oi 
any contract entered into or act done prior to its incorpora- 
tion (b). But to this rule there are statutory exceptions, 
and by the Companies act, 1862, a company formed before 

(a) See Be Hodges, 8 Cli. 204 ; Fell 
v. Burchelt, 7 E. & B. 537, where a 
shareholder in a registered company 
was unsuccessfully sued. Compare 
Barton v. Hutchinson, 2 Car. & K. 
712. The company should be sued 
in its corporate name simply. Pil- 

brow v. Pilbroiv's Atmospheric Bail. 
Co., 3 C. B. 730. As to service of 
writs, &c, see R. S. C. 1883, Ord. ix., 
r. 8, and Companies act, 1862, § 62. 
(b) See ante, p. 146, and the next 

I.< ..IM'mRATED compamks. 

November, L862, but registered under the act, may apparently 1;k - IT - ( ! 
sue ami be sued m it- corporate name m respect of such 
matters as it mighl have sued it have been sued for if qo 
registration had taken place(c). 

The law relating to actions by and against companies which Actions by and 

i • i -Hi • -i • i ■ n against 

are being wound up, will bo examined m that portion oi the panies being 
treatise which relates 1>> the winding up of companies; but it W0UIK ap " 
may he observed here generally, that when a company regis- 
tered under the Companies act, 1862, i- being wound up, 
actions, whether by or againsl it, musl be brought in its 
registered uame(d), and not us under the Winding-up acts ; — \~ 
of 18 JS !), in the name of the official manager or liqui- 
dator {<■). 

A foreign company (/), and also a limited company it th ire Security for costs 

.... ... . . ,. . ' when company 

is reason to suppose thai its assets will he insufficient to pay . sues . 
the defendant's costs, can he compelled to give security for the 

costs of actions instituted by it (.</). An affidavit, showing 
reasomihle ground for supposing that the company cannot pay 
the costs, will, if unanswered, induce the Court to order secu- 

(c) This it is conceived is the 
general effect of 25 & 26 Vict, c, 89, 
§§ L93-195. In Hull Flax Go. v. 
Wellesley, 6 H. & N. 38, calls made 
before registration were sued for 
afterwards in the company's re- 
gistered name, and were recovered. 
So in Queensbury Industrial > 
v. Pickles, L. B. 1 Ex. 1, where a 
society registered under 25 & i'<i 
Vict. c. 87, recovered in its regis- 
tered name a debt owing to it be- 
fore registration ; and compare that 
case with Dean v. Mellard, 15 C. B. 
N. S. 19, and Linton v. Blakeney 
Industrial Society, 3 H. & C. 853, 
where societies registered under the 
same act were held not liable to 
be sued in their registered names 
in respect of debts contracted before 
registration. The only general con- 
clusion to be drawn from these cases 
is that the exact language of each 
act must be closely attended to. 

See, farther, Lanyon \. Smith, 3 
Sm. 938. 
25 & 26 Vict. c. 89, § 95. 

(«) 11 & 12 Vict. c. 45, § 50, et 
seq. There were, however, some 
cases in which he could not sue. 
See, as to this, Re Weiss, 15 C. E. 
331 ; Russell v. Groysdill, 11 Ex. 

(/) Kilkenny, &c, Go. v. 
Fielden, 6 Ex. 81 ; Limerick, dr., 
Bail. Co. v. F enter, 4 Bing. 394. 

((/) Western of Canada Oil Go. v. 
Walker, 10 Ch. C2s ; 25 & 26 Vict. 
c. 89, § 69. City of Moscow Gas Co. 
v. International Financial Soc, 7 
Ch. 225 ; Washoe Mining Co. v, 
Ferguson, 2 Ecp 371. The section, 
however, did not apply to pure 
cross suits; Accidental and Marine 
Insur. Co. v. Mercati, 3 Ecp 200 ; 
nor to petitions of appeal, lie 
Marine Estates Co., Jan. 18G7, 

l. j. j. ^.^ %yU— i* a.«.<3. 2-79 



Bk. II. Chap. 7. rity to be given (h). And in the absence of any evidence to 
— the contrary, the fact that the company is in liquidation affords 
a sufficient reason for ordering security (?). The amount and 
kind of securit}' are in the discretion of the Court, and depend 
on the nature of the case (k). In injunction actions a limited 
company's undertaking to abide by such order as the Court may 
make as to damages is not sufficient (I). 

An unlimited company, although it is insolvent and being 
wound up, cannot be ordered to give security for costs of an 
action (m). 

Actions by the Attorney- General to restrain companies from 
exceeding their statutory powers may be brought in cases 
where, owing to the absence of any special injury to a par- 
ticular individual, an action by a stranger will not lie (n). 

"Where companies are amalgamated b}' act of Parliament, it 
is generally enacted that actions pending against either com- 
pany may be continued against the amalgamated company, and 
in such cases it is only necessary to state the amalgamation on 
the proceedings (o). 

At common law incorporated companies act in legal pro- 
ceedings by their agents, appointed under seal ( p). 

Actions by the 

Actions after 

(h) Southampton Steamboat Co. v. 
Rawlins, 9 Jur. N. S. 887, and 2 N. 
K. 544, in which Caillaud's, d'C, Co. 
v. Caillaud, 26 Beav. 427, contra, was 
not followed. 

(i) Northampton Coal, dr., Co. v. 
Midland Waggon Co., 7 Ch. D. 500 ; 
and as to appeals, see Diamond Fuel 
Co., 13 Ch. D. 400; Photographic 
Artists' Ass., 23 Ch. D. 370. 

(k) E. S. C. Ord. lxv. r. 6, as to the 
old practice, see Imperial Bank of 
Cliina v. Bank of Hindustan, 1 Ch. 
437, modifying Australian St am 
Ship Co., 4 K. & J. 407. 

(/) Anglo-Danubian Co. v. Roger- 
son, 3 N. B. 185, and 10 Jur. N. S. 

(m) United Ports Co. v. Hill, L. 
B, 5 Q. B. 395. This does not apply 
to appeals. 

(/() See Att.-Gcn, v. Shrewsbury 

Bridge Co., 21 Ch. D. 752 ; AU.-Gen. 
v. (h-eat Northern Bail. Co., 1 Dr. & 
Sm. 154, and Ware v. Regent's Canal 
Co., 3 De G. & J. 212. It may be 
inferred from the judgment in the 
latter case that a definite injury to 
the public need not be proved in 
order to support such an action. 

(o) See 26 & 27 Vict. c. 92, § 43. 

(p) See, as to bankruptcy, 46 & 
47 Vict. c. 52, § 148. As to regis- 
tered companies, see 25 & 26 Vict. c. 
89, § 64. See, as to the service of 
writs on companies, E. S. C. Ord. ix. 
r. 8, Pilbrow v. Pilbrow' s A tmospheric, 
&c, Co., 3 C. B. 730 ; and as to com- 
panies . registered under the Com- 
panies act, 1862, see 25 & 26 Vict. 
c. 89, § 62, and Towne v. London 
and Limerick Steam Ship Co., 5 C. B. 
N. S. 730 ; and as to foreign com- 
panies, see Ingate v. Lloyd Austriaco, 


As between the parties to an action instituted by an incor- 1;1 - Ir - Chap. 7. 
porated company, a retainer under -> al of the solicitor acting 
for it will, if necessary, be presumed (q) ; but in an action by ^S?^™*** 
that solicitor againsl the company for his costs, it i-. question- 1 '" ' '"'■" 1 - 
able whether ;i proper retainer under seal must aol be 
proved (r), if such retainer is essential, which d< pends on the 
nature of the company («). 

The directors of a company have, it is conceived, power to 
institute and defend actions in the name of the company, and 
to do for it whatever may be necessary, having regard to the 
ordinary course of legal proceedings. It has been held that a 
liond given by an incorporated company as a security for costs 
in an action to which it is party, and in the ordinary course, is 
not ultra vires (t). 

Ina case where a company was restrained from infringing a 
patent the directors were ordered to pay the costs(w). 

In an action by or againsl an incorporated company, any Directors may be 
member or officer may he examined on interrogatories (x) ; and " lU ' n,, ° ateJ - 
he need not be made a party to the action tor purposes of 
discovery only Q/). 

2. Companies empowered to sue and be sue,! by public officers. 

Cost-book mining companies are empowered to sue for calls Statutory enact- 
i , , • / \ -d i • • -. meats enabling 

by their purser (z). .banking companies governed by the companies to 8 ue 

and be sued. 

4 C. B. N. S. 704 ; Newly v. Von (») See Beits v. De Vitro, 5 X. B. 

Oppen, L. R. 7 Q. B. 293 ; Lhoneux 165, V.-C. Wood, and 3 Ch. 429 and 

Limon & Co. v. Hong Kong Banking 441. 

Corp., 33 Ch. D. 446. (,) R. S. C. Ord. xxxi. rr. 1 and 5. 

(q) Thames Haven Dock Co. v. As to the person to examine, see 

Hall, 5 Man. & Gr. 274. Berkeley v. Standard Discount Co., 9 

(r) Compare Arnold v. Mayor of Ch. D. 643 ; 12 Ch. D. 295, and 13 

Poole, 4 Man. & Gr. 860, with Haigh Ch. D. 97; Re Alexandra Palace 

v. North Bierley Union, E. B. & E. 873. Co. , 1 6 Ch. D. 58. 

(s) P. v. Cumberland, 5 Ra. Ca. (ij) Wilson v. Church, 9 Ch. D. 

332. See as to companies registered 552. 

under the act of 1862, § 37. (z) See 32 & 33 Vict. c. 19, § 13 ; 

(t) Young v. Brompton JVaterw. but this enactment only applies to 

Co., 1 Best & Sm. 675. See as to calls and to companies subject to 

references to arbitration, Faviell v. the jurisdiction of the Stannary 

Eastern Counties Bail. Co., 2Ex. 344. Courts. 


Bk. II. Chap. 7. 7 Geo. 4, c. 46 (extended by 27 & 28 Vict. c. 32), and com- 
- panies formed under the Letters Patent act, 7 Wm. 4 & 1 
Vict. c. 73 (a), are empowered by statute to sue and be sued in 
the name of an individual appointed to sue and be sued on 
their behalf; and there is a large number of private acts (b) 
enabling particular companies to sue and be sued in like 
manner. It is customary to designate such companies as 
companies empowered to sue and be sued (c), and amongst them 
will be found most existing unincorporated companies formed, 
for other than mining purposes, before the passing of the 
Joint- stock companies registration act of 1844. 

Who are repre- A company which, without being incorporated, is empowered 

sented by public . _, . „ . .. 

officers. to sue and be sued by a public officer, is sufficiently repre- 

sented by that officer in all actions between the company as a 
body on the one side, and a stranger on the other (d). But, as 
will be seen hereafter (e), a public officer does not represent 
one set of shareholders as against another set ; for he is only 
the representative of the shareholders as a body. 
Whether public It does not follow that, because a company is empowered by 
sued™ mUSt ^ some P r i vate statute to sue and be sued by a public officer, 
therefore a creditor may not sue any one or more of the share- 
holders. Creditors are not deprived of their common law 
rights by an act of Parliament which is consistent with their 
retention of those rights ; and there are several instances of 
special statutes under which it has been held, that, although a 
creditor might sue the public officer, it was not incumbent on 
him to do so (/). 

(a) § 1, repealed by 37 & 38 Viet. 1 C. B. N. S. 241. 
c. 35. Industrial and Provident (<■) A good account of the pro- 
Societies were formerly empowered gress of legislation relating to these 
to sue and be sued by a public companies will be found in Van 
officer, Burton v. Tannahill, 5 E. Sandau v. Moore, 1 Euss. 441. 
& B. 797. By 39 & 40 Vict, c. 45, (d) See Pendlebury v. Walker, 4 
§ 11, such societies are incorporated Y. & C. Ex. 424 ; Meux v. Maltbij, 2 
by being registered under that act. Swanst. 277. 

(6) There are also some colonial (c) See book iii., c. 9, § \i. 

statutes to the same effect. The (/) Blewitt v. Gordon, 6 Jur. 825, 

validity of one of them was unsuc- per Coleridge, J. ; S. C, 1 Dowl. 

cessfully disputed in Bank of Aus- N. S. 815 ; Pentland v. Gibson, 1 

tralasia v.Nias, 16 Q. B. 717. See, Ale. & Nap. 310 ; Beech v. Eyre, 5 

too, Bank of Australasia v. Harding, Mac. & Gr. 415. 
9 C. B. 661 ; and Kelsall v. Marshall, 


Another ob ervation to be made with respecl to these privati ''■'•• "• ' '"l 1 - 7 - 

! - i- 
acts is, thai the public officers created by them have do ]><>■ 


except those expressly conferred upon them. Where, there- p U b] 
fore, a company was empowered to sue and be Bued in the 
name of its secretary, and to institute actions and suits in his 
name, it was held that he had no power to petition on behalf 
of the company for a commission of bankruptcy against one of 
its debtors (g). 

Questions sometimes arise as to whether a public officer can On what 

t racts public 

sue or be sued in respecl of a contract nol expressly entered 
into with the company. These questions will all be found to 
turn on the Language of the act applicable to the company to 

which the questions relate ; hut speaking generally, it may be 
said that a public officer may sue or be surd upon contracts 
which an- contracts of the company in point of substance, 
although not in point of form (h). 

A promissory note payable to the order of a person who is Bills and not< . 
in fact a trustee for a company empowered to sue by a public 
officer ought, if unindorsed, to be sued upon by the payee and 
not by the public officer (/). 

A public officer may sue for a libel on the company repre- Libels. 
sented by him (k). 

By far the greater number of decisions to he met with in the Public officers 

, . (jt 1 tanking 

hooks relating to puhlic officers, have turned upon the Banking companies, 
act of 7 Geo. 4, and to these decisions, so far as they relate 
to actions between companies governed by the act on the one 
hand, and strangers on the other, it is now' proposed to direct 
the reader's attention. 

(y) Guthrie v. Fish, 3 B. & C. 929 ; Smith v. Goldsworthy, 4 Q. B. 

178 ; and see Ex parte Guthrie, 1 430 ; Wills v. Sutherland, 4 Ex. 

Gl. & Jam. 245. Some of the older 211, and on appeal, 5 Ex. 715 ; 

acts only empower companies to Skinner v. Lambert, 4 Man. & Gr. 

sue by tlieir public officers, and are 477. See, also, Cobham y.Holcombe, 

altogether silent about their being 8 C. B. N. S. 815. 

sued. See the act which was in (i) See M'Dowell v. Doyle, 7 Ir. 

question in Meux v. Maliby, 2 Com. Law Rep. 598. See as to bills 

Swanst. 277. More modern acts payable to officers for the time being, 

are much more comprehensive in 45 & 46 Vict. c. 61, § 7, cl. 2, ante, 

their terms. See now Bankruptcy p. 230. 

Rules 1886, r. 258. w^6..(.f^9^f5o (k) Williams v. Beaumont, 10 

(h) Soulby v. Smith, 3 B. & Ad. Bing. 260. 



Bk. U. Chap. 7. The Banking act of 7 Geo. 4, c. 46 (I), has been decided to 

Sect. 1. . . 

- require imperatively, that all actions by or against companies 
raeo. 01 ?, ^*!. governed by it shall be brought by or against their public 
officers, and not otherwise (m). What is to be done if there is 
no public officer is not clear (n) ; perhaps now, in such a case, 
a creditor could sue the company in its mercantile name ; or 
sue some of the members on behalf of the whole company (o). 

The fact that the company has stopped pajmient does not 
prevent it from suing and being sued by its public officer (p) ; 
and if a banking company changes its name, the public officer 
of the new company represents the old company (q). \Vhatever 
number of public officers a company may have, one only should 
sue or be sued (/•). The bankruptcy of a public officer does not 
prevent his being sued as such (s). 

The change of a public officer pendente lite does not affect 
the action (0 . If an action is brought by a public officer, and 
he dies or is removed, and no steps are taken by his successor 
to prosecute the action, it may, after the lapse of the usual 
time, be dismissed with costs for want of prosecution (u). 

It is to be observed, that if a person who is not a public 

Effect of i hang- 
in.; public 

Action by a per- 
son who assumes 
to be a public 

officer, sues as if he were, the company which he assumes 
to represent is not a party to the action, and consequently 

(1) Amended by 1 & 2 Vict. c. 96, 
3 & 4 Vict. c. 11, and 27 & 28 Vict. 
c. 32. 

(m) Steward v. G reaves, 10 M. & 
W. 711; Chapman v. Milvain, 5 
Ex. 61. Compare Robertson v. 
Sheward, 1 Man. & Gr. 511. See 
as to laying intent to defraud in 
indictments for forgery, B. v. ( 'artt r, 
1 Car. & K. 741 ; B. v. Beard, 8 
Car. & P. 143 ; I!, v. James, 7 Car. 
& P. 553 ; and P. v. Bur gist, ib. 
490 ; and as to an affidavit to hold 
to bail, Spencer v. Newton, 6 A. & 
E. 630. The Industrial Provident 
Societies act, 17 & 18 Vict. c. 25, 
was also imperative, Burton v. Tan- 
nahill, 5 E. & B. 797. 

(n) See Steward v. Greaves, 10 M. 
& TV 711. An indictment will lie 

for stealing the property of the com- 
pany although there is no public 
officer, B. v. Pritchard, 7 Jur. X. S. 

(o) See R.S. C. Ord. xvi. rr. 9 and 

(p) Davidson v. Cooper, 11 M. & 
W. 778 ; Needham v. Law, ib. 400. 

(q) Wilson v. Craven, 8 M. & YV 

(/•) Holmes v. Binney, 4 Bing. N. 
C. 454. 

(s) Steward v. Dunn, 11 M. & W. 

(i) See Webb v. Taylor, 8 Jur. 39 ; 
Todd v. Wright, 11 Jur. 471 ; Barne- 
wedl v. Sutherland , 9 C. B. 380, and 
Paterson v. Ironside, 14 Jur. 722, note. 

(/') Burmester v. Von Stcntz, 23 
Beav. 32. 


will not bo affected by the judgment in it ; hence the fact. Bk - n - Cha P- "• 

Sect. 1. 
thai the plaintiff is whal he pretends to be, is material and 

traversable (x) ; and declarations and affidavits by public 
officers have been held bad for not stating with sufficient 
precision tbe character in which the plaintiff on the record 

was suing, and tbe existence of the company he assumed to 
represent (//). 

Although, as has been seen, a public officer may sue on Company must 

ll'tVC be STUD 

behalf of a company which ha3 stopped payment, there can be business. 

no public officer under the 7 Geo. 4, c. 46, of a company which 
has not begun to carry on the business of bankers under that 
act (z) . 

In an action against a public officer as a nominal defendant, Plea that j.ison 
lie may deny that he fills the office he is assumed to fill (a). ^yicVt'i: 
But this defence will be of no avail, if the only evidence 
to support it is that the company has ceased to carry on 
business (6). A plea of the bankruptcy of a person sued as a 
public officer will not be allowed to stand, if the plaintiff' will 
give an undertaking not to issue execution against the person 
or property of the defendant himself (c). 

Under the 7 Geo. 4, c. 4G, public officers are appointed bv Appointment of 

.. . .. . , , public officers 

their respective companies ; and returns are required to be under 7 Geo. 4, 
made to the Stamp Office, in the form given in the schedule c ' 46 ' 
to the act, stating the names and places of abode of the persons 
so appointed (d). The most formal evidence of the appoint- 
ment of a particular individual to be a public officer of a corn- 
er) See Barneicall v. Sutherland, 9 record, and was not in issue. 
C. B. 380; Steward v. Dunn, 11 M. («) Roe v. Fuller, 7 Ex. 220; 

& W. 63. Steward v. Dunn, 11 M. & W. 63 ; 

(y) See Esdaile v. Maclean, 15 Fletcher v. Crosbie, 9 M. & W. 252 ; 
M. & W, 277 ; Mclntyre v. Miller, and compare Davidson v. Bower, 4 
13 ib. 725 ; Fletcher v. Crosbie, 9 ib. Man. & Gr. 626. 
252 ; Christie v. Peart, 7 ib. 491 ; (a) Qu. whether the denial must 

Spiller v. Johnson, 6 ib. 570; David- not be supported by affidavit, Wood 
son v. Bower, 4 Man. & Gr. 626. v. Marston, 7 Dowl. 835. 
See as to affidavits Ex parte Tor- (6) See Needham v. Law, 11 M. & 

Hngton, 9 Ch. 298; Ex parte Lowen- W. 400; Davidson v. Cooper, ib. 778. 
thai, ib. 324. Compare Robinson v. (c) Steward v. Dunn, 11 M. & W. 

Sheward, 1 Man. & Gr. 511, where 63 ; Wood v. Marston, 7 Dowl. 865. 
the character in which the plaintiff (d) 7 Geo. 4, c. 46, § 4. 

was suing did not appear on tbe 



Bk. II. Chap. 7. pany, is the return made by the company to the Stamp Office 
- in pursuance of the statute. But it has been frequently decided 
that the appointment may be proved otherwise than b} T such 
returns, e.g., by parol testimony, and that an informality in a 
return is of no importance, if satisfactory evidence aliunde of 
the alleged appointment is forthcoming (<?). 

It has been decided that if a public officer brings an action, 
he may be interrogated by the defendant (/)'. 

The law relating to public officers of companies formed 
under the Letters Patent act, 7 Wm. 4 & 1 Yict. c. 73, will 
be found in §§ 3, 13, 22, 23, 24 and 25 of that act. There 
have been no decisions upon it bearing upon the present 
subject, but it seems clear that a company governed by it 
must sue and be sued by its public officer, if there is one ; 
but if there is not, then any member of the company may be 

public officer. 

Public officers 
of companies 
governed by 
7 Wm. 4 & 
1 Vict. c. 73. 

3. Other unincorporated companies. 
Difficulty of Unincorporated companies not empowered by statute to sue 

Sature e Acte. and be sued b * y a P ublic officer > must sue aud be sued like 
ordinary partnerships (g). This observation applies to unin- 
corporated cost-book companies (/*). Consequently, before the 
passing of the Judicature acts, it was extremely difficult for 
unincorporated and unprivileged companies to sue at law at 
all, and various unsuccessful attempts were made to avoid the 
necessity of joining all the proper persons as co-plaintiffs (?)• 

(e) Edwards v. Buchanan, 3 B. & 
Ad. 788 ; R. v. Carter, 1 Car. & K. 
741 ; E. v. Beard, 8 C. & P. 143; B. 
v. James, 7 C. & P. 553. 

(/) M'Kenna v. Bolt, 3 Jur. N. S. 
714, Ex. 

(g) As to which, see Partn. book 
ii., c. 3, pp. 264, et seq. 

(h) Such companies can sue for 
calls by their purser, ante, p. 265, 
but there is no statutory enactment 
enabling them to sue and be sued 
generally by that officer. 

(i) See as to all such attempts, 
Badenhurst v. Bates, 3 Bing. 470; 

and as to agreements to enable 
actions to be brought by the chair- 
man for the time being of the direc- 
tors of a company, Hall v. Bain- 
bridge, 1 Man. & Gr. 42 ; by the 
directors for the time being of a 
company, Phelps v. Lyle, 10 A. & E. 
113 ;*Woobner v. Toby, 4 Ra. Ca. 
713 ; by the purser for the time 
being of a cost-book company, 
Hybart v. Peirker, 4 C. B. N. S. 209 ; 
by the managers of a mutual marine 
insurance society, Gray v. Pearson, 
L. R. 5 C. P. 568 ; Corner v. Max- 
u-ell-Iru-in, Ir. R. 10 C. L. 354. Ou 



Bui even as the law bI 1 before those acts, there was no great J:k - g c ; c ^ h 1 ap - 7 " 

difficulty in the way of a creditorwho soughtto obtain payment — 

of a debt owing by the company. For although if he did not 
sue all the shareholders who in strictness ought to have been 
sued, he might have been met by a plea in abatement, yet 
Inasmuch as such a plea was of no avail unless it disclosed the 
uames of all the persons who ought to have been made defen- 
dants, and unless it was verified by affidavit, and unless it 
was strictly proved if issue was taken upon it, it was practi- 
cally impossible for a member of a large company seriously 
to obstruct or embarrass a creditor by having recourse to a plea 
in abatement, founded on the non-joinder of the other share- 
holders (_/). 

The alterations made in the law respecting parties to actions Alterations made 
by the Judicature acts and rules, have, however, removed the tore Acts. 
difficulty in the way of unincorporated companies suing ; for 
an action may now be maintained by or against some of the 
shareholders on behalf of themselves and others having a 
common interest in the action (/.) ; or, where no change has 
occurred amongst the shareholders, an action may be brought 
in the name of the company (I). 

Actions in this form will have to be adverted to hereafter kct lT^ J »° me 

on behalt or 

when treating of actions between companies and their mem- themselves and 


bers ; but it niay be observed here that even before the 
Judicature acts, suits in equity by some persons on behalf of 
themselves and others having a common interest, were fre- 
quently instituted to enforce equitable rights, e.g., to enforce 
the rights of the mortgagees of a company's undertaking (m) ; 
to rescind a contract for fraud (n) ; to enforce specific per- 

the other hand a contract made with observation, 

an agent of a company might be sued (k) R. S. C. Ord. xvi. r. 9. 

on by the agent, unless the contract (I) lb. it. 14 & 15. See Partn. 

was on the face of it made with the book h., c. 3, § 1, p. 265 et seq. 

company through its agent. See (m) Tripp v. Chard Bail. Co., 11 

C'lmj v. Southern, 7 Ex. 717, and so Ha. 241. 

it may now. (n) Small v. Attwood, Younge, 

(j) Grellin v. Calvert, and Crellin 457 et seq.; Fenn v. Craig, 3 Y. & 

v. Brook, 14 M. & W. 11, may be C. Ex. 213. 
referred to as illustrating the above 


Bk. II. Chap. 7. formance of an agreement (o) : to obtain an account ( //), or an 

Sect. 1. . . ° w 
injunction (q). 

Some on behalf So a suit against some of the members of a numerous part- 
^ edt nership or unincorporated company, might be maintained to 

enforce an equitable right if it was a right against the whole 
body, and one which all the members thereof had a common 
interest in opposing (/•). But suits in this form could not be 
maintained to enforce purely legal rights, on the ground that 
it was inconvenient to sue at law (s) . 

Now actions in this form are maintainable in all the divisions 
of the High Court. Such actions, however, are occasionally 
attended with inconvenience, for although judgment may be 
obtained, it may be found practically useless. 
Meux r. Malthy. The case of Meux v. Maliby (t) illustrates this. A suit 
was there instituted against the treasurer and the directors of 
a company, to obtain the benefit of an agreement made with 
the plaintiff by the former owner of property which had 
become vested in the company. The agreement was an agree- 
ment for a lease, and the Court made a decree in the plaintiff's 
favour, but found itself unable to decree the execution of any 
lease to him. The defendants had no power to convey the 
legal estate in the land, and all the Court could do was to 
declare the plaintiff entitled to a lease, and to restrain the 
officer from bringing any action to disturb the plaintiff's 

(o) Clay v. Bufford, 8 Ha. 281 ; 216 ; Gullen v. Duke of Queensberry, 

and see Douglas v. Horsfall, 2 Sim. 1 Bro. C. C. 101, and 1 Bro. P. C. 

& Stu. 184. 396 ; The City of London v. Eich- 

(p) Gordon v. Pijm, 3 Ha. 223. mond, 2 Vera. 421. 

(</) Lund v. Blanshard, 4 ib. 290. (s) Allison v. Herring, 9 Sim. 583. 

(r) See Pare v. Clegg, 29 Beav. (t) 2 Swanst. 277. See, too, Lund 

589, where a suit was instituted by v. Blanshard, 4 Ha. 290, where an 

the creditor of a benefit society injunction restraining a defendant 

against its trustees, and one of each from suing the plaintiffs, was held 

class of its members. See, also, not to preclude the defendant from 

Adair v. The New River Co., 11 Ves. suing other persons on behalf of 

429 ; Meux v. Malthy, 2 Swanst. whom the plaintiffs filed their bill. 
277 ; Fenn v. Craig, 3 Y. & C. Ex. 

! ol P. -17>'> 

J;k. II. Chap. 7. 

Tn actions between companies on the one hand and non- 
members on the other, there is little to be sai I upon the 
subject of set-off, except that the ordinary rules are applicable; 
the most important rule being that joint debts cannot be set- 
off against separate debts (u), and that the debts of a body 
corporate cannot be set-oil' against the separate debts of its 
members. Unliquidated damages may be set-off in an action 
by the company although it is being wound up (x). 

It is onlv when a company sues or is sued by one of its own Set off where a 

^ company sues a 

members, or by some person claiming under him, or when one member. 
member of a company, having obtained judgment against it, 
seeks to enforce such judgment against a co-member, or when 
a company is being wound up, that questions of set-off present 
peculiar difficulties. These are matters, however, which will 
be more conveniently discussed hereafter, and the only obser- 
vation which requires to be made here is, that in actions 
between a company on the one hand and one of its own 
members on the other, the member is so far treated as a 
stranger to the company, that cross debts existing between 
him and the company may be set off against each other (y), 
but that cross demands between himself and other members 
individually cannot be gone into. As regards incorporated 
companies, this follows from the circumstance that they are 
distinct from the members composing them ; and as regards 
unincorporated companies, it follows from the doctrine that a 
debt due from or to several persons jointly, cannot be set off 
against a debt due to or from some or one of them only. 

Moreover, if a member of an unincorporated joint- stock Set-off where 

. . . one member sues 

company is a creditor of the conipairv, and is in a position to another tor a 
sue the other members or any of them, it is no defence that if t h e company 7 
the compairy were wound up, and its accounts taken, the 
plaintiff would be found indebted to the company as a share- 
holder thereof. In such a case as that now supposed, the 

(u) Partn. book ii., c. 3, § 2, p. App. Ca. 434. 
290, et seq. (y) Garnet Mining Co. v. Sutton, 

(x) Mersey Steel and Iron Co. v. 3 B. & Sin. 321. 
Naylor & Co., 9 Q. B. D. 648, and 9 

L.C. T 


Bk. II. Chap. 7. plaintiff sues as a non-member ; and if his demand is one 

Sect. 2. 

- capable of being enforced, lie will not be prevented from 

enforcing it, simply because in his character of member, he is 
indebted to his co-shareholders. This is well illustrated by 
a case before Lord Cottenham, which may be conveniently 
noticed here, although it will have to be referred to again in 
connection with another subject. In the case in question, 
Rbeam v. Smith. Rheam v. Smith [z), the plaintiff and one of the defendants 
were members of an unincorporated joint-stock company ; the 
defendants were the bankers of the company, and had sued the 
plaintiff' for a debt due by the company to the defendants as 
bankers. The plaintiff thereupon filed a bill against the 
bankers and the company, upon the ground that he ought not, 
as between himself and the bankers (one of whom was a share- 
holder), to pay more than what, on taking the accounts of the 
company, would be found to be due from the plaintiff in 
respect of the debt in question. The bill accordingly prayed 
that the accounts of the company might be taken, and its 
affairs wound up, and that provision might be made for due 
payment of the debts of the company, and that in the mean- 
time the action, and all proceedings therein, might be stayed. 
A demurrer to the bill was overruled by the Vice- Chancellor, 
who, it is said, treated tbe case as one in which a partnership 
of A. and B. was suing a partnership of A., C, and D., in 
which case it would be contrary to equity to allow the debt to 
be recovered without first ascertaining for what proportion of 
it A. was himself liable (a). But on appeal to the Lord Chan- 
cellor, the decision below was reversed, and the demurrer was 
allowed : the Lord Chancellor observing, — 

" It really seems to me that, if the principle upon which this demurrer is 
said to have been overruled by the Vice-Chancellor were admitted, it might 
lead to the most frightful consequences ; for it comes to this, that if a 
railway company, or any company carrying on great works, and who may 
have become indebted to some contractor in half-a-million of money for 
work done, upon that contractor applying for payment of his debt, can find 

(,-.•) 2 Ph. 726. clear that although one partner 

(«) The fact that such an action might under certain circumstances 

could not be maintained at law, is sue another at law, A. and B. could 

not noticed in the report. But it is not possibly have sued A. and C. 

SET OFF. 275 

.■lit thai he, or any one connected with him in business, holde share Bk. II. Chap. 7. 

in the company, they may jay, No, we cannol payourdebl : you must ectj 2j 

lir-i break up the company, and a certain whether Li as ts are sufficient Rheam ,-. Smith, 
for paymenl of its debts, for if not, you ot the persons connected with you 
will In-- liable to contribute to the very sum which you seek to recover. It 
is impossible to Btop Bhorl of that if the principle be once admitted. After 
some difficulty a rule has been established at law, enabling creditoi 
these greal companii I i enforce their claims against individual share- 
holders, leaving them, of ■ urse, to their right to contribution against their 
co-partners. The rule, no doubt, leads sometimes to hardship upon the 
party sued, hut the balance of convenience is in its favour, and for that 
reason it lias been adopted : because it would be a still greater hardship 
upon parties dealing with such companies, if the enforcement of their 
claims were to he embarrassed by the necessity of treating all the members 
of the company as jointly responsible. This suit, however, is an attempt 
to induce a court of equity to interfere with that rule, for the plaintiff, by 
his hill, asserts in effecl nothing short of this proposition : — If I ran find 
out that you, who are suing me at law, have a Bingle share in the company 
against whom the claim is made, then there is an end to your legal right; 
equity will interfere, and though your money may have contributed to the 
establishment of the company, you shall not he permitted to recover a 
single farthing against any member of the company until the concern is 
altogether wound up."' 

It must not, however, be inferred from this case, that if a 
member of a company litis a demand against it, and seeks to 
enforce that demand against some member of it, he may not 
be met by some defence based on the rights of the members 
inter se. This subject will be examined in the third book, 
when the rights of members inter se are discussed (b). 

The general rule that an assignee of a debt is in no better Set-off against 

..,,. . . , , holders of 

position than his assignor, is undoubted ; and, as a general securities. 
rule, where a debt due from a company is assigned, the assign- 
ment cannot defeat the right of the company to set off against 
the assignee, what may be due from the assignor to the com- 
pany before the company has notice of the assignment, and 
when payment by the company is demanded (c) ; nor defeat the 

(b) See Woodhams v. Anglo- Aus- 102, and 3 De G. & J. 294. See, 
tralian Co., 2 De G. J. & Sm. 162. also, WatJcins v. Clark, 12 C. B. N. 

(c) Ashworth's case, 10 W. E. 771, S. 277 ; Watson v. Mid Wales Rail 
V.-C. W. ; and see Athenceum Life Co., L. R. 2 C. P. 593. 
Assurance Society v. Pooley, 1 Giff. 

T 2 



Bk. II. Chap. 7. company's right to set off what may become due after such 
— notice under the same contract as created the debt assigned (d). 
At the same time, it is possible for a company to deprive itself 
of this right of set-off; and if, being indebted, it gives to 
its creditor a document which shows that the debt is to be paid 
without reference to the state of other accounts which may 
exist between him and the company, the company cannot, when 
sued for such debt, set off demands which it may have against 
him for other matters. The decisions on this subject will, how- 
ever, be more conveniently referred to hereafter when treating 
of the proof of debts in winding-up proceedings (c) . 

against com- 

Modes of exe- 
cuting such 
against the 

First mode. 


By the common law, a judgment against an incorporated 
company can only be executed excep against the property 
of the company ; and a judgment against an individual 
cannot by common law be executed against any person or 
property, except the person or property of the individual 
named in the judgment. In order, however, to give creditors 
a more extensive remedy than the}" would have at common 
law upon a judgment obtained against companies, either in 
their corporate names or in the names of their public officers, 
the legislature has rendered such judgments enforceable 
against the individual members of the companies. For this 
purpose three schemes have been had recourse to. 

The first in point of time was applicable to companies 
empowered to sue and be sued, and was as follows : — A credi- 
tor having obtained judgment against the public officer, was 
allowed to proceed upon that judgment by scire facias against 
any of the shareholders in the company at the time the judg- 
ment was obtained ; and, if necessary, also against such of the 

(d) See, as to this, Government of (e) See infra, book iv. c. 1, § 9, 

NeiLftntjiillandy.NeivfoundlandRail. and Aslatt v. Farquharson, 10 W. 
Co., 1 :i App. ( !a. 1 99 ; and Partn. 364. R. 458. 


late shareholders us were members of the company when the I;k - ir - Chap. 7. 
debt was contracted. ■ — ■ — ■ — 

The next device was a mere modification of the last, and Second mode. 
consisted in the application of it to judgments against com- 
panies by their corporate names, which judgments were mail. 
enforceable against shareholders and former shareholders in 

substantially the same manner as thai above explained: a 
qualification, however, was added, to the effect that recourse 
should not be had against individual shareholders until efforts 
had been made in vain to obtain payment from the company, 

and as to some companies, that recourse should not be had 
against any shareholder except to the extent of his shai 

The third and last device was altogether different, and was Thud mode, 
the result of the course adopted by creditors, who, when the}' 
could not obtain satisfaction from companies, singled out some 
unfortunate shareholder, and compelled him to pay the whole 
amount for which judgment had been recovered. This course 
was in the highest degree cruel ; and Parliament was induced, 
when legislating on joint-stock companies, in 1856, to leave out 
all those clauses, found in the preceding acts, enabling creditors 
to execute judgments against individual shareholders, and to 
provide, instead, that creditors should have the power, upon 
non-payment of the debts due to them from the company, to 
cause it to be wound up. The same view prevailed when the 
acts relating to joint-stock companies were remodelled in 1862. 
Consequently, a creditor of a company registered under the 
Companies act, 1862, can only execute a judgment obtained 
against the company b} r proceeding against the corporate pro- 
perty, and, if necessary, by having recourse to a petition for 
winding up the company. 

Such is a general outline of the manner in which a creditor 
of a company has been enabled to obtain satisfaction of a 
judgment recovered against it. To fill up this outline so far 
as is possible, without alluding to repealed statutes and to the 
winding up of companies, is the object of the remainder of the 
present section. 



Bk. II. Chap. 
Seel. 3. 

against cor- 

of company's 


1. Execution against the company. 

A judgment against a corporation is executed against the 
corporate property in the same way as a judgment against an 
individual is executed against his property ; and a judgment 
against a public officer ma} r , it is conceived, be executed 
against him and his property as if he were an ordinary indi- 
vidual, where the right of the judgment creditor is not in this 
respect modified by statute (/). 

What is propert^y of a company must be determined by 
ordinary principles of the law of property. It must be borne 
in mind that unsecured creditors of companies, whether limited 
or unlimited, have no lien on their assets (<y) ; and cannot pre- 
vent a sale or other disposition thereof (h) ; and it is clearly 
competent for all companies to divide profits amongst their 
shareholders, and to that extent to convert what was property 
of the company into the separate estates of the members. 
But any division of the property of a company amongst its 
members which is not warranted by the constitution of the 
company can be impeached by the company itself (i) ; and 
any division of the assets of a coinpairy which would not leave 
enough to pay the creditors of the company, would primd 
facie be a fraud upon them ; and even if not a fraud upon 
them would probably be ultra vires (k). 

The rolling stock and plant of railway companies (l) are 
protected from seizure by statute (m) ; but a judgment creditor 

(/) See Harrison v. Tvmmins, 4 
M. & W. 510 ; JFormwell v. Hail- 
stone, 6 Bing. 668, where the no- 
minal defendant was held not liable 
to execution ; and Corpe v. Glyn, 3 
B. & Ad. 801, where he was held 
not liable to an attachment. See 
infra, as to particular companies. 

(g) But see, as to cost-book com- 
panies, 32 & 33 Vict. c. 19, §§ 24 & 
36, and 50 & 51 Vict. c. 43, § 4, 
giving miners a lien for their wages. 

(h) Mills v. Northern Rail, of 
Buenos Ayres Co., 5 Ch. 621. 

(£) See Society of Practical Know- 
ledge v. Abbott, 2 Beav. 559. 

(k) See, as to this, Stringer's case, 
4 Ch. 475 ; Cardiff Coal Co. v. Norton, 

2 Eq. 558, affirmed by Lord Chelms- 
ford, 2 Ch. 405. The decision in this 
case was probably right under the 
peculiar circumstances affecting the 
real plaintiff, but some of the prin- 
ciples laid down in the case deserve 
serious reconsideration. 

(I) The term includes railway and 
dock companies, see East and West 
India Docks Co., 38 Ch. D. 576; Gt. 
North. Rail. Co. v. Tuhourdin, 13 Q. 
B. D. 320. Compare Exmoulh Docks 
Co., 17 Eq. 181. As to tramway 
companies, see Brentford, ii~c, Tram. 
Co., 26 Ch. D. 527. 

(m) 30 & 31 Vict. c. 127, § 4, 
made perpetual by 38 & 39 Vict. 
c. 31. 


of such a company can obtaii a receiver of the earnings of Bk. II. Chap. 7. 
tne company (ro), and ••an issue execution against its unpro- 

tected property, and obtain a sale of its surplus Lands 

A corporation cannot be attached for contempt or for dis- Attachments, 
obedience to an order made upon it (p). Bui if an order is 
made upon a corporation, and its directors or officers set the 
order at defiance, an attachment against them personally will, 
if necessary, be granted (q). By the Rules of the Supreme 
Court, L883, Ord. XLII. r. 31, it is provided that :— 

'• A.ny judgment or i rder againsl a corporation wilfully disobeyed, may, Executions 
by leave of the Courl or a judge, be enforced by sequestration against the against corn- 
corporate prbpi rty,or byan attachment against thedu officers paD 
thereof, or by writ of sequestration againsl tli.-ir property "(?•)• Attachments. 

Ads of Parliament are sometimes met with which empower Under Acts 
a company to sue and be sued by a public officer, but which, * e nds 

instead of giving any remedy against him or the other share- alone liable - 
holders individually, render the funds of the company alone 
liable to its creditors. In such a case no execution against 
the public officer of the company, or against any of its share- 
holders, can be issued (s) ; but an action against the public 
officer will nevertheless lie, even although there may be no 
funds, and the plaintiff may consequently have no means of 
enforcing his judgment after he has obtained it (t). If there 
are funds they can be got at; but before the Judicature act it 
was said that the only mole in which a creditor could get at 
them was by mandamus, or by a bill in equity (u). 

(») Mancliester and Milford Bail. award. 

Co., 14 Ch. D. 645 ; Southern Rail. (q) LacMrme v. Quartz Rock 

Co., 5 L. K., Ir. 105. The line must Mining Co., 1 H. & C. 134, and see 

have been begun, see Birmingham Salmanv.HamburgCo.,1 Ch.Ca. 204. 

and Lichfield Rail. Co., 18 Ch. D. (>■) This rule takes the place of 

155. Only one receiver will be § 33 of the C. L. P. act, I860 (23 & 

appointed, Mersey Rail. Co., 37 Ch. 24 Vict. c. 126), which was repealed 

D. 610, which see as to priorities. by 46 & 47 Vict. c. 49. 

(o) Hull, Barnsley, &c, Rail. Co., (s) See Harrison v. Timmins, 4 M. 

40 Ch. D. 119. See as to debenture & W. 510 ; Worm-well v. Hailstone, 

holders, where one sues on behalf of 6 Bing. 668 ; Gorpe v. Glyn, 3 B. & 

himself and others, Hope v. Croydon Ad. 801. 

and Norwood Tramways Co., 34 Ch. (t) See Kendall v. King, 17 C. B. 

I). 730. 483. 

(p) Machenziev.Sligo and Shannon (it) Seethe cases in the last two 

Rail. Co., 9 C. B. 250, a case of an notes. Actions have been brought 


Bk. IT. Chap. 7. Even before the Common law procedure act of 1854, tlie 
Sect. 3. ... 

- 68th section of which considerably extended the power of 

Mandamus in . 

suck cases. courts of law to grant a mandamus (x), it had been held that a 

creditor of a company, who b} T virtue of its act of Parliament 
had no remedy against its shareholders, but only against the 
funds of the company, was entitled to a 'mandamus to its 
treasurer and directors, after establishing his debt in an ac- 
tion (y). If there are no funds, and the company is not under 
an obligation to provide any, no mandamus can be granted {z) ; 
but if the company is under an obligation to provide funds, 
and it will take no measures to raise them, it seems that a 
mandamus will go (a). It has, however, been held that a writ 
of mandamus will not be granted if the only reason why pay- 
ment cannot be obtained by execution in the ordinary way, is, 
that there is nothing to seize (b). 

The effect of winding up a company upon executions against 
it will be examined hereafter in the Fourth Booh. 

2. Proceedings against shareholders upon a judgment obtained 

against a company or its public officer, generally. 

Shareholder can If a company is incorporated, or if it must be sued by a 

only be pro- „ 

ceeded against public omcer, a creditor cannot proceed by action against a 

aoain^the 1611 * snare holder ; but must obtain judgment against the company 

company. an( j then proceed upon that judgment (c). It seems to be 

doubtful, whether a county court judgment against a company 

can be executed against its shareholders ; hence the prudence 

of suing companies in one of the superior courts (d). 

in such cases, as in Cane v. Chapman, ib. 360. 

5 A. & E. 647 ; but see Addison v. (;:) E. v. The Victoria Park Co., 1 

The Mayor of Preston, 12 C. B. 108. Q. B. 288. 

(x) See Norris v. The Irish Land («) Ib. ; and see R. S. C. Ord. liii. 

Co., 8 E. & B. 512, correcting Benson r. 1. 

v. Paull, 6 E. & B. 273. The section (b) See R. v. The Victoria Park 

was repealed by 46 & 47 Vict. c. 49. Co., 1 Q. B. 288. 

The Supreme Court Rules of 1883, (c) Fell v. Burchett, 7 E. & B. 537 ; 

Ord. liii. it. 1 to 4, have taken its and see as to public officers, ante, p. 

place. 265, et seq. 

(y) See Corpe v. Glyn, 3 B. & Ad. (d) See Taylor v. The Crowland 

8oi ; R. v. St. Katherine Unci Co., 4 Gas Co., 11 Ex. 1. 


By the common Law, a judgment againsl A. cannot be exe- llk - "• n "i- "• 

■ .■'.. 
cuted againsl B. withoul a scire facias, which, though a judicial 

. . . , „ , ' fa. against 

writ, is m tne nature of an action, and may be pleaded to B harehoid< 
accordingly. So, before a judgment in the Chancery division Judgment in 
against a public officer can be enforced againsl individual Division, 
shareholders, an order against them personally musl be ob- 
tained (e). The object of the sci.fa. was technically to make 
the execution conformable to the judgment ; hut substantially 
its object was to give the person againsl whom the judgmenl 
was sought to be enforced an opportunity of defending himself; 
for, ex hypoth si, he had not had that opportunity before (/). 

Proceedings by sci.fa. have not been abolished; but a much OrderXLU. 
simpler mode of proceeding lias been introduced by the Rules r- 2 ' J ' 
<>f the Supreme Court, 1883, Ord. XLII. r. 23, which pro- 
sides that — 

" Where a party is entitled to execution against any of the shareholders 

of a joint stock company npmi a judgment recorded against such company, 
or against a public officer or other person representing such company, the 
party alleging himself to be entitled to execution may apply to the Court 
or a judge for leave to issue execution accordingly, and Buch < lourt or judge 
may, if satisfied that the party so applying is entitled to issue execution, 
make an order to thai effect, or may order that any issue or question 
necessary to determine the rights of the parties shall he tried in any of the 
ways in which any question in an action may lie tried. And in either case 
such Court or judge may impose such terms as to costs or otherwise as shall 
he just." 

This improvement in procedure renders it unnecessary to 
refer at length' to the old rules of practice relating to sci.fa.; 
hut as they may be still useful in some cases, a short account 
of them is given in a note at the end of the present chapter. 

A judgment or writ of execution against a company or its Registry of jud£- 
public officer may be registered like any other judgment or TOmpanies!'^ 
writ of execution ; and in those cases in which a judgment 
is equivalent to a judgment against all the members of the 
company individually, and is enforceable against them, it has 
been supposed to affect them as if it had been in form a judgment 

(c) Vigers v. Pike, 8 CI. & Fin. Com. Dig. Pleader, 3 L. ; Bac. Ab. 

652 ; Healey v. Chichester and, Mid- Sci.fa., and the note to Underhill v. 

hurst Rail. Co., 9 Eci. 148. Devereux, 2 Wms. Saund. 71. 

(/) See, generally, as to sci. fa. 


Bk. II. Chap. 7. against tliem individually and registered accordingly (g). But 

OGCt. o. 

as a judgment against a company or its public officer could 

not be executed against an individual shareholder of the com- 
pany without a sci.fa., it could not be reasonable to make that 
judgment a charge on his property before execution against 
him could lawfully be sued out (h). A judgment registered 
against a company governed by the act of 1862 obviously does 
not affect the property of its members. 
Discovery of In order to enable a creditor who has obtained judgment 

shareholders. . _. . 

against a company to discover the persons against whom such 
judgment may be executed, provision has been made by the 
various statutes relating to companies compelling them to 
make periodical returns, or to keep registers, of the names and 
residences of their shareholders, and directing such returns or 
registers to be open for inspection (i). 
Right of creditor A creditor who has obtained judgment against a company, 

to proceed against , . , « .. , . . 

individual share- ar >d is m a position lawfully to execute such judgment against 

holders. ^ e individual members of that company, cannot be restrained 

from proceeding to execute it against any member or members 

he may choose to select, provided he acts bond fide for the 

purpose of obtaining payment of what is due to him (k). But, 

(g) See Ex parte Ness, 5 C. B. sary ; R. v. The Derbyshire Bail. Co., 

155. 3 E. & B. 784, where a mandamus 

(h) See Harris v. The Royal was obtained. As to examining the 

British Bank, 2 H. & N. 535. It directors, see Dickson v. Neath and 

has been held in Ireland that a Brecon Bail. Co., L. R. 4 Ex. 87. 

judgment obtained against a com- See, also, R. S. C. Ord. xlii. r. 32, 

pany ought not to be registered et sea., as to discovery in aid of 

against a former shareholder. See execution. 

Hone v. O'Flahertie, 9 Ir. Ch. 119, (h) See Morisse v. The Royal 

where relief against such registra- British Bank, 1 C. B. N. S. 67 ; 

tion was given. See, also, Ex parte Green v. Nixon, 23 Beav. 530. See, 

Thornton, 2 Ch. 171, as to register- also, Hardinge v. Webster, 1 Dr. & 

ing winding-up orders. See now 51 Sm. 101, where it was held that a 

6 52 Vict. c. 51. member of a company who had ob- 
(i) See 7 Geo. 4, c. 46, § 4, et seq.; tained judgment against it could 

7 Wm. 4 & 1 Vict. c. 73, § 6, et not be restrained from enforcing 
seq. ; 8 & 9 Vict. c. 16, §§ 9, 10, 36; that judgment against another 
and as to the mode of obtaining in- member of the same company, 
spection, see Meader v. I. of Wight The company was governed by 7 
Ferry Co., 9 W. R. 750, Ex., where & 8 Vict. c. 110, and had become 
a mandamus was held not neces- amalgamated with another com- 


as will be seen hereafter, neither a judgment creditor, nor a Bk. [I. Cbap. 7. 

purchaser from him, will be allowed to use the judgment for ■ 

the dishonest purpose of aiding some members of the company 
against the others (/). 

Upon a proceeding against a shareholder to enforce a judg- 
ment already obtained against a company or public officer, the 
shareholder is bound by the judgment, and cannot impeach it, 
except on the ground that the judgment itself was obtained by 
fraud (m). A judgment obtained by default is, in the absence 
of fraud, as conclusive against the shareholders as any other 
judgment (//). 

A judgment obtained by fraud and collusion is however Exception in 
always impeachable by innocent parties affected by it; and STp^oT the™ 
however high the tribunal in which the judgment has been creditor, 
pronounced may be, its invalidity on the ground of fraud may 
be examined by any inferior court which may happen to be 
called upon to give effect to it (o). If, therefore, a shareholder 
is proceeded against upon a judgment obtained by fraud on the 
part of the creditor, the judgment may be impeached ; and il 
seems that the shareholder may at his option either apply to 
the Court in which the judgment was obtained to have it set 
aside, or rely on the fraud as a defence to a sci. fa., or to an 
application for leave to issue execution as the case may be (p). 

It is to be observed that the fraud here referred to as Frand by com- 
affording a defence to the sci. fa., is fraud on the part of the Eddcr do^ntt 
judgment creditor in obtaining the judgment. Fraud on a prot j:. ct llim from 
shareholder by the directors of the company, and to which 

pany in which the defendant was a ston's case, in 2 Sm. L. C, and 

shareholder, Imt the plaintiff was the admirable dissertation upon it 

not. there. 

(/) See Woodhams v. Anglo- Aus- ( p ) See Dodgson v. Scott, 2 Ex. 

tralian Co., 2 De G. J. & Sm. 162. 457 ; Edwards v. The Kilkenny Co., 

(m) See Peddell v. Gwyn, 1 H. & 2 C. B. N. S. 397 ; Philipson v. 

N. 590; Bradley v. Eyre, 11 M. & Egremont, 6 Q. B. 587; Bosanquet 

W. 432 ; Fowler v. BicJcerby, 2 Man. v. Graham, 6 Q. B. 601, note ; Green 

& Gr. 760. v. Nixon, 23 Beav. 530. The hrst 

(h) Green v. Nixon, 23 Beav. 530. two of these cases, and Harvey v. 

See, also, Ex parte Chorlcy, 11 E<p Scott, 11 Q. B. 92, show that it is 

137. not proper to raise the question of 

(o) See Shedden v. Patrick, 1 frand upon a motion for leave to 

McQu. 535; The Duchess of King- issue a sci. fa. 



r.k. ii. Chap. 7. fraud the creditor is not privy, affords no defence to pro- 
Sect. 3. 
ceedings b} r him against the shareholder. This was decided in 

several cases arising out of the failure of the Royal British 

Bank, and is a necessaiy consequence of the principles of the 

law of partnership (q). 

Creditor pro- A shareholder in a company cannot escape from the liability 

ceeding against . .... . i i i i 

shareholder after to its creditors which is imposed irpon him as a shareholder, 

in u.iii- im to exce p£ by v i r tue of some act of theirs : and nothing short of 
become such. r j o 

fraud on their part, or of some contract or conduct of theirs 
precluding them from treating him as their debtor, will afford 
him a defence as against them so long as their demand exists 
as between them and the company. This is well illustrated 

Bill v. Richards, by Bill v. Richards (r), where a shareholder in a railway com- 
pany pleaded to a sci.fa. issued against him by a creditor who 
had obtained judgment against the company, that he, the share- 
holder, had at the request of the plaintiff taken shares in the 
compan} r as a trustee for others, and upon the faith of the 
plaintiff's statement that by so doing no responsibility in 
respect of the shares would be incurred. It was not alleged 
that the plaintiff had been guilty of any fraud ; his statement 
did not relate to any matter of fact ; it did not amount to a 
contract of indemnity, nor to a contract that if he were a 
creditor of the company he would not endeavour to obtain pay- 
ment from the defendant. It was quite consistent that all that 
was meant was, that if the defendant would allow shares to be 
taken for others in his name the} 7 would indemnify him against 
the consequences, and the defence was therefore held insuffi- 
cient, although pleaded as a defence on equitable grounds. 

No remedy by The effect which a contract by a company to pay out of its 

creditor whose ..... ....... 

right is limited funds, and those only, has in limiting the liability oi the share- 

funds npany S holders, has been already examined (s). Where such a contract 

has been entered into, no execution on the judgment against 

(q) Henderson v. Royal British 
Bank, 7 E. & B. 356. See, too, 
Daniell v. Tlie Royal Brit. Bank, 1 
H. & N. 681 ; Poms v. Harding, 
1 C. B. N. S. 533. Howard v. Shaw, 
9 Ir. Law Kep. 335, shows that a 
shareholder sued for a debt of the 
company cannot escape payment on 

the ground that the company was 
concocted in fraud, and that its deed 
of settlement was invalid. 

(r) 2 H. & N. 311. Compare 
Batty v. McCundie, 3 Car. & P. 203 ; 
Connop v. Levy, 11 Q. B. 709. 

(s) Ante, p. 24(i, et seq. 


the company will go against the shareholders at the Buit of ;i 1;; - 'J- , ' l,:i i'- "• 
person seeking to enforce that contract (t). 

The effect of winding up proceedings on executions against 
members of companies will be noticed in the Fourth Book. 

Having made these preliminary remarks on the subject ot 
executions against shareholders generally, it is proposed to 
examine more in detail the law relating to proceedings against 
shareholders in companies governed by the Banking act of 9 
Geo. 4, the act of 7 Wm. 1 & 1 Vict. c. 73, the Companii a 
clauses consolidation act, and other compan 

3. Proceedings against members of particular companies. 

<() Execution against members of companies governed by 1 Geo. 1, c. 16. 

The Banking companies act of Geo. 4 requires the public Execution 
officers of a company governed by that act to be members of officer under 

the company (it), and enacts that execution upon any judgment 
obtained against a public officer may be issued against any 
member of the company (x). Prom this it follows that a public 
officer of a company governed by the act in question is per- 
sonally liable upon every judgment obtained against him; and 
that writs can issue against him grounded on such judgment, 
and that, so far as he is concerned, no intermediate proceeding 
is necessary (y). If, indeed, the public officer named in the 
judgment has ceased to be a member of the company, then, by 
the act, he is only liable like other former shareholders ; and 
upon an affidavit by him, the court will stay execution against 
him until after he has been proceeded against by scire facias or 
its modern equivalent (z). 

The act in question, 7 Geo. 4, c. 46, allows a creditor, who Liability of 

. • n -. shareholders 

has obtained judgment against the public officer to execute under 7 Geo. 4, 
that judgment — c< 40 ' 

1. Against any member for the time being of the company ; 
and in case any such execution shall be ineffectual, then 

(t) HalJcety. The Merchant Traders' (y) Harwood v. Lau; 7 M. & W. 

Ass., 13 Q. B. 960. 203. 

(u) 7 Geo. 4, c. 46, § 4. (z) See Harwood v. Lau; 7 M. & W. 

(a;) § 13. 203. 



Members for the 
time being. 

Bk. II. Chap. 7. 2. Against any person who was a member ot the company 

Sect. 3. . 

— at the time the contract sued upon was entered into ; or 

3. Against any person who became a member at any time 
after such contract was entered into, but before it was exe- 
cuted ; or 

4. Against any person who was a member at the time when 
the judgment was obtained. 

But persons who are not members for the time being, and 
so do not fall within the first class, are only liable for three 
} T ears after they have ceased to be members (a). 

It appears, therefore, that a creditor must go first of all 
against the members for the time being, and that until he has 
done so he cannot go against late members (b) ; and by members 
for the time being are meant, not members at the time judgment 
was obtained against the public "officer, but members at the time 
a sci.fa. or summons on the judgment is issued (c). Members 
for the time being in this sense can be proceeded against at 
once, and the statute expressly allows proceedings to be taken 
against any one or more of them. Their liability, it will be 
observed, is much more extensive than the liability of ordinary 
partners ; not being confined to debts incurred after they 
become partners. 

A sti. fa. (or now a summons under R. !?. C. Ord. XL1I. 
r. 23) is the proper mode of proceeding against shareholders 
under this act (d) . 

The names of the shareholders can be ascertained from the 
returns made to the Stamp Office (e). 

A creditor is not bound to proceed against all the members 
for the time being before having recourse to former members ; 

Former mem- 

(a) 7 Geo. 4, c. 46, § 13. 

(h) Hence a late member was a 
competent witness for the public 
officer. Necdham v. Law, 12 M. & 
W. 560. 

(c) See Dodgson v. Scott, 2 Ex. 
457. See, too, Bradley v. Eyre, 11 
M. & W. 432, which turned on a 
private act in which similar words 

(d) Ransford v. Bosanquet, 2 Q. 
B. 972, and Bosanquet v. Ransford, 

11 A. & E. 520, and Cross v. Law, 
6 M. & W. 217 ; Wittenbury v. Law, 
6 Bing. N. C. 345; Williams v. 
Aspinall, 7 Scott, 822, contra, is not 
to be relied upon. The rule for a 
sci. fa. against present members is 
absolute in the first instance, arid 
need not be moved for in open 
court, Harrison v. Tysan, 1 Bail Ct. 
Ca. 111. 

(e) See 7 Geo. 4, c. 46, § 4, et seq., 
and see ante, p. 110. 

i COMPANIES GOVERNED BY 7 GEO. i, C. l< - >. 287 

l)ut he must make every reasonable effort to obtain payment 1;k - n - r,,a P- 7. 

. ' ; - 

from the firsl before he acquires a right to proceed agamst the 

last. Acting upon this principle, the Court allowed a sd. fa. 
to issue against a late member, although proceedings against a 
member for the time being were pending, evidence being given 
to Bhow that nothing was to be got from him, and that evi- 
dence being uncontradicted (/). So in another case, a late 
member was allowed to be proceeded against, although some 
only of the members for the time b< ing had been sued ineffec- 
tually, uncontradicted evidence being given that inquiry had 
been made as to the solvency of the others, and that there was 
reason for believing that payment could not he obtained from 
any of them (g). So it was unnecessary for the creditor to 
issue writs of ca. %a. against the existing shareholders before 
proceeding against former members (h). Moreover, a mort- 
gagee who has obtained judgment for his debt, and has clone 
his best to obtain payment by executing that judgment against 
the members for the time being, is, it seems, entitled to 
proceed against former members, even without realising his 
mortgage (e). On the other hand, the Court will refuse a 
creditor leave to proceed against a late member where there is 
reason to believe that satisfaction can be got with diligence 
from existing members (k) ; and a return of nulla bona to a 
writ of fi. fa. issued against the public officer, together with a 
loose affidavit as to the insolvency of the members for the time 
being, will not of itself be sufficient to satisfy the Court that 
payment from them cannot be obtained (I). 

With respect to late members, the act, as has been seen, Classes of former 
makes three classes of them liable, and renders it lawful for mem ers ' 
the creditor to proceed agamst any or all of them, not con- 
fining him to one class before having recourse to another (m). 

(/) Dodgson v. Scott, 2 Ex. 457. 802. See, too, Cross v. Law, 6 M. 

(g) Harvey v. Scott, 11 Q. B. 92 ; & "W. 217. 

Field v. Mackenzie, 4 C. B. 705. (F) Bank of England v. Johnson, 3 

(h) Field v. Mackenzie, 4 C. B. Ex. 598. 

'32. (m) A rule for a sci. fa. against a 

(i) lb. 4 C. B. 725. The mort- late member must be served per- 

gage in that case could not be sonally, or be shown to have reached 

realised at once without great loss. him, Esdaile v. Smith, IS L. J. Ex. 

(h) Eardley v. Law, 12 A. & E. 120. 


Bk. II. Chap. 7. The liability of late members is, in some respects, mure ex- 

— tensive than the liability of retired partners at common law, 

inasmuch as these last are not liable to be sued in respect of 
debts contracted before they became members. But, on the 
other hand, the statute limits the duration of a late member's 
liability to creditors to three years after retirement (n). More- 
over, there is one class of late members who cannot be pro- 
ceeded against by one class of their former creditors at all, 
viz., those members who did not become such until after the 
creditors' debts had arisen, and who had ceased to be members . 
before judgment obtained against the public officer. "Whether 
the omission of all members of this class to creditors of 
this class was designed or accidental is not known ; but being 
omitted, their freedom from liability towards such creditors is 
complete (o). 
Evidence of A creditor, being entitled to issue execution only against 

membership. . . . . 

members lor the time being, or, 11 necessary, against certain 
classes of late members, must, before he can obtain leave to 
proceed against any particular person, adduce some evidence 
to show either that such person is a member for the time 
being, or that he was a member at the time when the contract 
with the creditor was entered into, or before the same was 
executed, or at the time judgment was recovered ( p). For this 
purpose recourse is usually had to the memorial of share- 
holders, directed to be returned to the Stamp Office, which is 
held to be sufficient if uncontradicted, even although it may 
be in some respects informal (q) or inaccurate as regards the 
name of the shareholder proceeded against (r). The memorial 

(?i) This limitation applies only to although there was strong evidence 

creditors, and does not prevent a late against his having heen a member at 

shareholder from being a contribu- the time alleged. 

tory, although three years may have (</) See Ex parte Prescott, Mon. & 

elapsed since he retired from the Ch. 611 ; Harvey v. Scott, 11 Q. B. 

company. Gouthwaite's case, 3 Mc. 92 ; Field v. Mackenzie, 4 C. B. 705 

& G-. 187. and 717 ; Bosanquet v. Shortridge, 

(o) See Dodgson v. Scott, 2 Ex. 4 Ex. 699. Compare Prescott v. 

457, and Harvey v. Scott, 11 Q. B. Buffery, 1 C. B. 41, ante, p. 110. 

92. (/•) Clowes v. Brettell, 11 M. & W. 

(p) In The Bank of England v. 461, decided on a private act. See 

Johnson, 3 Ex. 598, the Court let too, Thompson v. Harding, 1 C. B. 

a sci. fa. issue against a person N. S. 555. 


is not. however, conclusive, nor is it the only evidence of Bt - n. Cna P- 7. 

Beet. 3. 

membership ; and it has been decided that a person whose 

name is omitted 1V« >ni the last return may nevertheless In- 
proved, aliunde, to have been a shareholder when the return 
was made, and that, if there is a dispute as to the fact of mem- 
bership, proper steps must be taken in order to have that 
question tried («). 

As between a creditor and an alleged shareholder, the gues- Effecl ofnon- 
r i i • ii-i i -i compliance with 

tion 01 membership or no membership depends entirely upon requisite for- 

whether the requisites, which, by the company's deed, have " ,;i 

to be complied with before a person becomes a member, have 

been complied with or not ; and it may happen that one and 

the same person is not a member for the purpose of being 

proceeded against by a sci. fa., although he may be a member 

for the purpose of being made a contributory on the winding 

up of the company (£). 

/») Execution against members of companies governed by tJu Letters Patent act. 
The Letters Patent act (7 Win. 4 & 1 Yict. c. 73) does not Execution 

n' r ii-i against public 

require the public officers ol a company governed by it to be officer under 
members of the company ; and even if they arc members their ^ Vi ^' c Z 3 
liabilities are restricted to the extent specified in the letters 
patent of their respective companies. These circumstances 
alone, it is conceived, render it improper for a creditor to issue 
execution against a public officer of a company governed by 
the Letters Patent act without an order of a court or judge («) 
or a sci. fa. ; for it is clear from the act that he cannot be made 
personally liable unless he is or has been a member, and in 
neither case is lie liable to the extent to which he would be 
liable at common law. 

The act in question appears to empower a creditor who has Liability of 
obtained judgment against the public officer of a company um i e r 7 Wm. 4 
governed by it, to execute that judgment against all or any of & l ' " 

(s) Bank of England v. Johnson, strong, 4 ib. 21 ; Bosanquet v. Short- 

3 Ex. 598 ; Prescolt v. Buffery, 1 C. ridge, ib. 699, there cited. See, too, 

B. 41. Dodgson v. Bell, 5 Ex. 967. 

(t) See ante, p. 54, and Ness v. (u) Under R. S. C. Ord. xlii., r. 23, 

Angus, 3 Ex. 805 ; Ness v. Arm- ante, p. 281. 

L.C. U 



Bk. II. Chap. 7. the shareholders, or late shareholders whom he might have 

— sued for payment at common law ; the only qualifications 

being : 1, that a shareholder who transfers his shares con- 
tinues a shareholder for all purposes of liability until the 
transfer has been registered ; and 2, that the extent of a 
shareholder's liability is limited or unlimited, according to 
the letters patent granted to the company (x). This act has 
not received any judicial interpretation throwing light upon 
the liabilities imposed by it, and it is by no means clear, 
that the liability of an incoming shareholder is not more 
extensive than the ordinary liability of an incoming partner. 

The names of the shareholders can be ascertained from the 
returns made under the act(//). 

Under 8 & 9 
Vict. c. 16, 
creditor must 
first go against 
the company ; 

c) Execution against members of companies governed by 8 & 9 Vict. c. 16. 

"With respect to companies governed by the Companies' 
clauses consolidation act (8 & 9 Vict. c. 16), there is one im- 
portant rule which has no analogy with anything met with in 
the law applicable to ordinary partnerships, or in that ap- 
plicable to companies governed by the Banking act of 7 Geo. 4, 
c. 46, or by the Letters Patent act of 7 Wm. 4 & 1 Vict, 
c. 73. The rule referred to is, that the creditors of a company 
governed by the Companies' clauses act, are not entitled to 
proceed against the shareholders personally, if payment can be 
and show that he obtained from the company. In other words, the creditors 
payment from it. must have recourse to the assets of the compan} r before they 
can have recourse to the shareholders individually. When, 
therefore, an application is made for leave to issue a sci.fa. or 
execution against a shareholder in a company governed by the 
act in question, evidence must be adduced to satisfy the Court 
that payment cannot be obtained from the company itself as a 
body (z). The creditor need not show that there is no possi- 

(x) 7 Wm. 4 & 1 Vict. c. 73, §§ 21 
& 24 ; and see upon it Philipson v. 
Egremont, 6 Q. B. 587. The writer 
supposes that the returns are now 
made to the High Court instead of 
to the Court of Chancery. 

[y) lb- § 6, et seq. 

(z) The same rule applied to com- 
panies governed by the repealed acts 
of 7 & 8 Vict, cc. 110 and 113. It 
seems that the sci.fa. need not con- 
tain any averment that nothing can 


bility of the company ever paying him : all that the Court Bk. n. Ch 

. _ 3. 

requires is to be satisfied that the creditor applymg for leave 

to proceed against the shareholder has qo means of obtaining 
present payment except from them individually. In order to 
satisfy the Court upon this head, the creditor must prove that 
he has made reasonable attempts to obtain payment from the 
company, and to discover assets presently available for his 
satisfaction, and that such attempts have been unsuccessful. 
A mere general assertion by a solicitor's clerk that writs of 
//. fa. have been issued against the company and returned 
nulla bona, is nut sufficient; for it is consistent with such an 
assertion that no attempt has been made to ascertain whether 
the company has any assets or not (a). But if attempts have 
been made to discover assets, and those attempts have been 
fruitless, and a writ of fi. fa. has issued against the company 
and been returned nuUa bona, that will be sufficient until it 
is shown affirmatively that the company has assets (b) ; and 
even if the company has assets which have not been taken in 
execution, still, if the Court is satisfied that they arc insuffi- 
cient to satisfy the plaintiff, the sci. fa. will go, or leave to 
issue execution will be given under R. S. C. Ord. XLIL, 
r. 23 (c). 

By the Companies' clauses consolidation act, a judgment Liability of ' 

i i-ii t shareholders 

recovered against a company to which such act applies, may, under s & 9 

if necessary, be executed against any of the shareholders- ^ lct- c ' 16 ' 

But no shareholder is liable to a greater extent than the 

amount unpaid up of his shares in the company (d). 

begot from the company, Hitchins Rail. Co., 2 C. B. N. S. 110; Ridg- 

v. The Kilkenny Rail. Co., 15 C. B. way v. TJie Security, dr., Ass. Soc, 

459 ; but if it does, the averment 18 C. B. 686. The return by the 

may be traversed, Mar son v. Lund, sheriff need not be filed when the 

16 Q. B. 344. See Nixon v. Brown- sci. fa. is moved for ; Ilfracombe 

loiv, 1 H. & X. 405. Rail. Co. v. Devon and Somerset Rail. 

(a) See Hitchins v. The Kilkenny Co., L. R. 2 C. P. 15 ; and see infra 
Rail. Co., 10 C. B. 160, and 15 ib. notes (e) and (g). 

459 ; King v. The Parental Endow- (c) Ilfracombe Rail. Co. v. Lord 

ment Co., 11 Ex. 443. Poltimore, L. R. 3 C. P. 288 ; Rigby 

(b) Rastrick v. The Derbyshire v. Dublin Trunk Rail. Co., L. R. 2 
Rail. Co., 9 Ex. 149 ; Nixon v. The C. P. 586. 

Kilkenny Rail. Co., 1 H. & N. 47 ; (d) 8 & 9 Yict. c. 16, § 36. See 

Hitchins v. The Kilkenny Rail. Co., Burke v. Dublin Trunk Rail. Co., L. R. 
15 C. B. 459 ; Wyall v. TheDarenth 3 Q. B. 47 ; Guest v. Worcester Rail. 

v 2 


Bk. II. Chap. 7. The expression, " any of the shareholders," has been decided 

Sect. 3. ... 
to mean any of the shareholders at the time execution against 

shareholders." the company is found to be ineffectual, i.e., in ordinary cases, 
at the time of the sheriff's return of nulla bona (e). Conse- 
quently, not only all persons who have ceased to be share- 
holders before judgment against the company has been 
recovered, but also all who have ceased to be so after that 
time, but before it has been ascertained that execution against 
the company on such judgment will prove ineffectual, are 
wholly exempt from liability to the judgment creditor (/). 

The act requires that every shareholder intended to be pro- 
ceeded against, is to have sufficient notice in writing before 
application for leave to issue a sci.fa. against him is made (<j). 
Leave to issue a sci. fa. will be refused if the Court is of 
opinion that there is a clear defence to it(h). On the other 
hand a sci. fa. may be dispensed with if the shareholder does 
not desire to contest his liability (i). How far these rules apply 
to proceedings under R. S. C. Ord. XLIL, r. 23, has not been 
Evidence of The meaning of the word shareholder in this act of Parlia- 

mem ers lp. men t has been already examined (A,) ; and it is only necessary 
here to observe that the company's register of shareholders, 
which a creditor who has obtained judgment against the 
company has a right to inspect (I), is, in the absence of evi- 

Co., L. R. 4 C. P. 9. In the last case 9 Eq. 148. 

the shares were not in fact paid up. (Ji) See as to the discretion of the 

(e) Nixon v. Green, 11 Ex. 550, Court, Shrimpton v. Sidmouth Rail. 

and 3 H. & N. 686 ; Nixon v. Co., L. R. 3 C. P. 80 ; Lee v. Bude, 

Broivnlow, 3 H. & N. 686. &c, Rail. Co., L. R. 6 C. P. 576 ; 

(/) Ibid. Burke v. Dublin Trunk Rail. Co., 

(g) 8 & 9 Vict. c. 16, § 36. See L. R. 3 Q. B. 47. However, in Guest 

Hitchins v. Kilkenny Rail. Co., 10 v. Worcester Rail. Co., L. R. 4 C. P. 

C. B. 160 ; Devereux v. Kilkenny 9, the Court allowed a sci. fa. to go 

Rail. Co., 5 Ex. 834. See Ilfra- although the case was clear. 

combe Rail. Co. v. Devon and Somer- (i) Burke v. Dublin Trunk, dr., 

set Rail. Co., L. R. 2 C. P. 15, and Rail. Co., L. R. 3 Q. B. 47. 

Edwards v. Kilkenny Rail. Co., 1 (k) Ante, p. 104. 

C. B. N. S. 409, as to serving the (I) 8 & 9 Vict. c. 16, § 36. R. v. 

notice and rule nisi on the share- The Derbyshire, &c, Rail. Co., 3 E. 

holder. See, as to enforcing decrees & B. 784 ; Header v. Isle of Wight 

in equity without a sci.fa. Healey v. Ferry Co., 9 W. R. 750, which shows 

Chichester and Midhurst Rail. Co., that a mandamus is not necessary. 


dence to the contrary, sufficienl proof that a person whose Bk - n - cha i J - 7. 

name is on it is a shareholder (ra). 13 ut the register is not 

conclusive evidence, and leave to issue a sci. fa. (or, it is 
presumed, execution, under I!. S. C. Ord. XLII.r. 23) againsl a 
person who is on it will not be given if he can show that lie is not 
a shareholder (n). Neither is the register the only evidence thai 
a person is a shareholder ; and a person made a member of the 
company by its special act, may 1/.- proceeded against accord- 
ingly, although no shares have been issued (o), unless he is to 
be regarded as having ceased to be a member (;>). In a case 
where a creditor was prevented from seeing the register, a sci. 
fa. was allowed to issue against a person sworn to be a .-hare- 
holder to the belief of the deponent, and which belief was 
founded on information from officials connected with the 
company (q). 

d) Execution "gainst members of other companies. 

Companies empowered by special acts to sue and be sued, Liability of 
and the shareholders in which are liable for the debts of the in other com- 
companies, will generally be found to resemble companies panies - 
governed by 7 Geo. 4, c. 46 (>•). 

Execution against partners or shareholders under judgments 
obtained against them in the name of their tirm or compam-, is 
governed by R. S. C. Ord. XLIL, r. 10, as to which see Part., 
Bk. II., c. 3, § 3, p. 298 et seq. 

Unregistered cost-book mining companies are partnerships, Cost-book 
and shareholders in them may be proceeded against ac- 
cordingly (s). But by the Stannaries act, 1887 (50 & 51 Vict. 

(m) See 8& 9 Viet, c. 16, §§ Sand & W. 506; Wmgfield v. Barton, 7 

29. Jur. 258 ; Wingiield v. Peel, 13 L. J. 

(n) Edwards v. Kilkenny Rail. Co., X. S. Q. B. 102 ; and as to friendly 

14 C. B. X. S. 526; Mather v. Nat. societies, Myers v. Rawson, 5 II. & X. 

Assoc. Investment Soc., ib. 676. 99. The 17 & IS Vict. c. 25, on 

(o) Portal v. Emmens, 1 C. P. D. which the last case turned, was re- 

201 and 664, ante, p. 104. pealed by 25 & 26 Vict, c. 87 (since 

(p) Kipling v. Todd, 3 C. P. D. 350. repealed by 39 & 40 Vict. c. 45, § 4). 

(q) Rastrick v. The Derbyshire, d-c., (s) Lanyon v. Smith, 3 Best & 

Rail. Co., 9 Ex. 149. See ante, p. Sm. 939 ; Trechecn v. Bourne, 6 M. 

104 et seq. & W. 401 ; Newton v. Daly, 1 Fos. 

(r) See Clowes v. Brettell, 10 M. & Fin. 26 ; Peel v. Thomas, 15 C. 



Bk. II. Chap. 7. c. 43) } § 6, in the case of execution against any company to 

which the act applies, the sheriff is to levy sufficient to pay all 

wages due at the date of the levy in addition to the judgment 
debt, and such wages are payable in priority to the judgment 

Companies Shareholders in companies governed by the Companies act, 

governed by . . . 

act of 1862. 1862, are not liable to execution on judgments against the 
company, but must be proceeded against under the winding-up 
clauses, which will be examined hereafter (t). 

The law respecting execution against members of companies 
governed by the repealed acts of 7 & 8 Vict. cc. 110 and 113, 
is now obsolete, and is therefore omitted (u). 

Note on procedure by Scire facias. 

Necessity of l n th° se cases "i which a judgment against a company or a public officer 

sci. fa. was sought to be enforced against a shareholder, a scire facias was a neces- 

sary preliminary, unless there was some statutory enactment to the 
contrary (a;), and a provision that execution should not issue without leave 
obtained by motion in open court, was not sufficient to dispense with a 
sci. fa. (y). 
Sci, fa. under A sci. fa, was necessary in the case of banking companies governed by 

7 Geo. 4, c. 46, *j Qeo. 4, c. 46 (a), and of companies governed by the Companies' clauses con- 
solidation act ( a) ; and probably also in the case of companies governed by 
the Letters Patent act, 7 Win. 4 & 1 Vict. c. 73. 
&Tvic't. c. 73. Under the repealed acts 7 & 8 Vict. cc. 110 and 113, leave to issue execu- 
Under 7 & 8 tion against a shareholder might be obtained without any suggestion or sci. 
Vict. cc. 110 f a . But this did not render a sci. fa. improper; and in point of fact it 
was very commonly had recourse to for the purpose of executing judg- 

and 8 & 9 Vict. 

c. 16 

Under 7 Wm. 4 

and 113. 

B. 714 ; Toll v. Lee, 4 Ex. 230 ; Q. B. 

Ellis v. Sclunoeck, 5 Bing. 521, are (y) See the last three cases. A 

instances of successful actions against judgment obtained in a colony may 

individual shareholders in cost-book be sued upon in this country in an 

mining companies. action in the ordinary form : Bank 

(0 25 & 26 Vict. c. 89, §§ 180 and of Australia v. Nias, 16 Q. B. 717. 

195. (z) Ransford v. Bosanquet, 2 Q. B. 

(u) It will be found in the first 972. 

edition of the present treatise, vol. i. (a) 8 & 9 Vict. c. 16, § 36 ; Hitchins 

pp. 458-462. v. The Kilkenny Bail. Co., 10 C. B. 

(x) Bartlett v. Bentland, 1 B. & 160 ; Devereux v. The Kilkenny Bail. 

Ad. 704 ; Clowes v. Brettell, 10 M. & Co., 5 Ex. 834. See, as to enforcing 

W. 506; Wing Held v. Barton, 2 decrees in equity, Healey v. Chichester 

Dowl. N. S. 355, and 7 Jur. 258 ; and Midhurst Bail. Co., 9 Eq. 148. 
Wimgfield v. Beel, 12 L. J. N. S. 102, 

PROCI.M l:l MY m Il;l. FACIAS. 


ments obtained ompaniee to which these acts applied (5). A ad. fa., iJk. II. Chap. 7. 

however, did not lie against the executors of a deceased shareholder (c). Sect. 3 - 

A writ of scire facias is a judicial writ, and is the commencemenl of a new Nature of act. fa. 
action, founded on a judgment already obtained. The wril states the 
recovery of the judgment, and whatever facts are necessary to show that the 
person againsl whom the writ is issued is liable to be proceeded against on 
that judgment ; and the shareholder againsl whom tin- writ is issued is 
commanded to appear to mow why the plaintiff ought not to have execution 
against him. Tin- writ is set out in a declaration or statement of claim, 
which prays that execution may issue againsl the defendanl (d) ; and which 

may be pleaded or demurred to in il rdinary waj 1 1 I ae having b< en 

joined, the cause proceeds to trial (/). A judgment obtained against a 
defendant in a mi. fa. is executed Like any other judgment. But the Court 
will compel the creditor to limit the amount for which execution is sued out 
to what may then be really due to him. This is done by putting the creditor 
on terms when leave to issue a id. fa. is granted {</). 

A sci.fa. issued irregularly, e.g., without leave, where leave is required, Irregular aci fa* 
will he set aside ; but a plea to it, alleging merely an irregularity for which 
it might be set aside, is bad (A). 

A judgment creditor of a company may is9Ue as many concurrent writs Concurrent writs 
of sci.fa. against as many shareholders as he thinks proper ; and so long as his °* s " - J a - 
demand is unsatisfied, a defence by any shareholder that the plaintiff is pro- 

(/») See as to 7 & 8 Vict. c. 110, 
Palmer v. The Justice Assurance So- 
ciety, 6 E. & B. 1015 ; Peart v. The 
Universal Salvage Co., 6 0. B. 47S ; 
Thompson v. The Universal Salvage 
Co., 3 Ex. 310 ; Re Weiss, 15 C. B. 
331. And as to 7 & 8 Vict. c. 113, 
see Bendy v. Harding, 1 C. B. N. S. 
551 ; TJtompsonv. Harding, ib. 555 ; 
Dossett v. Harding, ib. 524 ; Morisse 
v. The Royal British Bank, 1 C. B. 
N. S. 67 ; Wilde v. Stunner, 1 H. & 
N. 873. See, too, Powis v. Butler, 3 
C. B. N. S. 645, and 4 ib. 469 ; Fry 
v. Russell, 3 ib. 665. 

(c) Powis v. Butler, ubi supra. 

(d) See the pleadings in Ricketts 
v. Bowhay, 3 C. B. 889, where the 
writ and declarations are set out in 
full. See, too, Bradley v. Eyre, 11 
M. & W. 432 ; Nunn v. Claxton, 
3 Ex. 712. In some of the forms 
the writ is directed to the sheriff, 
but in others it is directed to the 
individual shareholder. 

(e) See Esdaile v. Trust well, 1 

Ex. 371 ; Bank of Scotland v. Fen- 
wick, ib. 792 ; Ness v. FenwicJe, 2 
Ex. 598 ; Nunn v. Claxton, 3 Ex. 
712, in each of which the declara- 
tion was demurred to. Several 
matters may be pleaded : Phillipson 
v. Tempest, 8 Jur. 60. As to the 
practice and forms, see 2 Chitty's 
Archbold's Practice, and Chitty's 
F( urns thereto. 

(/) The jury must not be share- 
holders, Esdaile v. Lund, 12 M. & 
W. 734. 

(g) See Harvey v. Scott, 11 Q. B. 
92 ; Green v. Nixon, 23 Beav. 530 ; 
Addison v. Tate, 11 Ex. 250. 

(h) Marson v. Lund, 16 Q. B. 
344 ; Bradley v. Warburg, 11 M. & 
W. 452 ; Ricketts v. Bowhay, 3 C. B. 
889 ; Bank of Scotland v. FenwicJe, 
1 Ex. 792 ; Bosanguet v. Graham, 7 
Jur. 831, Q. B. See as to suing out 
a sci. fa. on a judgment entered up 
for costs, Farmer v. Mottram, 6 Man. 
& Gr. 684. 


Bk. II. Chap. 7. ceecling against others is bad (i). Even the circumstance that judgments have 
Sect - 3 - been already obtained against them on the writs issued against them, affords no 
ground of defence ; for such judgments do not extinguish the right conferred 
upon the creditor by the prior judgment obtained against the company (k). 
Even before pleas in abatement were abolished it was decided that to a sci. 
fa. against a shareholder the non-joinder of other persons liable to be pro- 
ceeded against, could not be pleaded in abatement ; and if one sci. fa. issued 
against several shareholders, a declaration upon it against some of them only 
was not bad on demurrer, even if it were irregular (I). Neither is it any 
objection to a sci. fa. by a creditor against a shareholder that other creditors 
are suing him or are in a position to issue execution against him (m) ; 
although when he has paid the full amount to which he is liable, no other 
creditor can extract more from him (n). 
Applications for A rule for a sci. fa,, or an application for leave to issue execution (in those 
rule for sci. fa, cases i n which no sci. fa. is necessary) may, it seems, be moved for, or made, 
more than once by the same creditor against the same shareholder for the 
same debt, if the same rule or application has been allowed to drop for any 
satisfactory reason, or has been refused upon some technical ground which 
has been removed. At the same time the maxim, nemo debet lis vexari pro 
eddern causa, is applicable, unless some good reason to the contrary can be 
shown (o). 
Sci. fa. after A judgment against a company, the shareholders of which are liable to 

elegit. execution on the judgment, may be executed against them, although the 

creditor has issued an elegit against the company, and has obtained partial 
satisfaction by an extent under the writ (p). The extent does not, in these 
cases, satisfy the debt. If the creditor has received nothing from the extent, 
he is entitled to execution for his whole demand ; and if he has obtained any 
fruits from the extent, he is still entitled to execution for so much as remains 
clue (q). If the land extended is of small value compared with what is due 
to the creditor, he is entitled to execution against the shareholders without 
delay ; but if the land is of such a value that the creditor will in a short 
time be able to obtain payment without having recourse to the shareholders, 

(i) See Rigby v. Dublin Trunk (o) See upon this, Corder v. The 

Rail. Co., L. R. 2 C. P. 586 ; Nixon Universal Gas Light Co., 6 C. B. 190 

v. Brownlow, 1 H. & N. 405 ; Nunn and 554 ; Field v. Mackenzie, ib. 

v. Lomer, 3 Ex. 471. Compare 384 ; Dodgson v. Scott, 2 Ex. 457. 

Esdaile v. TrustweU, 2 Ex. 312, and Edwards v. Cameron's, dec, Rail. 

Esdailc v. Lund, 12 M. & W. 607. Co., 15 Jur. 470, Ex., is a strong 

(k) Burmester v. Crofton, 3 Ex. authority for not allowing two 

397. applications. 

(I) Fowler v. Rickerby, 2 Man. & (p) Addison v. Tate, 11 Ex. 250 ; 

Gr. 760, decided on 7 Geo. 4, c. 46. R. v. The Derbyshire Rail. Co., 3 E. 

See the argument in Esdaile v. & B. 784. 
Lund, 12 M. & W. 607. (q) See Addison v. Tate, 11 Ex. 

(m) Rigby v. Dublin Trunk Rail. 250, from which it appears that the 

Co., L. R. 2 C. P. 586. sci. fa. should state what has been 

(n) Burke v. Dublin Trunk Rail, done under the elegit, and the 

Co., L Pi. 3 O. B, 47. amount if any obtained by it. 


the Court will not, as ;i matter of course, lei immediate execution against Bk. IF. Chap. 7. 
them be issued (/•). Sect - 3 - 

Except where judgmenl has been obtained by fraud, the validity of a Validity of jndg- 
judgment which has been recovered against a company or its public officer, ment cannot \>e 
cannot be impeached by a shareholder who is proceeded against by sci. /a. qu . e v° n 
for, excepting in cases of fraud, nothing is admissible as a defence to a scu fa, 
w hich might have been relied on as a defence to the action on the judgment 
in which the set. fa. issues (s). The judgment i> conclusive, and nothing 
ran be set up as a defence to a set. fa. upon it, except some matter which is 
consistent with the validity of the judgmenl itself (i). 

Upon the same principle it seems that if judgment is obtained against a Bradley v. Eyre. 
person sued as a public officer, a shareholder cannot plead as a defence to a 
■-ri.fn., that the person against whom the judgment has been obtained was 
not the representative (d the company (</). In Buch a case application 
should be made to set aside the judgment (.<■). 

(r) See Addison v. Tate, 11 Ex. (») See Bradley v. Eyre, 11 M. & 

250. W. 432 ; Fowler v. Eickerby, 2 Man. 

(«) See per Lord Mansfield in & Gr. 760. 

Cook v. Jones, Cowp. 727. (.<•) Ibid., and Bosanquet v. Gra- 

(t) See the cases noticed, ante, ham, 7 Jur. 832, and 6 Q. B. 601, 

p. 283. note. 






Bk. III. Chap. 1. One of the peculiarities of companies, as distinguished from 

— ' partnerships, is that the management of a company's business 

is entrusted to a few chosen individuals, and that the share- 
holders are deprived of that right of personal interference 
which is enjoyed by the members of ordinary firms (a). The 
members of companies form two bodies, whose interests are 
or should be the same, but whose powers and functions are 
different ; the one body consists of the directors, in whom the 
general powers of management are vested ; and the other body 
consists of the shareholders, to whom the directors are ac- 
countable, and by whom they are generally appointed. Each 
of these bodies has its own sphere of action, and its own rights 
and duties, as will be seen more particularly hereafter. 


Managing body. Where there is no statutory or other provision regulating 
the constitution and powers of the managing body, the majority 
of the shareholders of the company must determine how its 

(a) See Burnesv. Pennell, 2 H. L. C. 520 and 521. 


affairs are 1" be conducted, and to whom, and under what Bk. HI. Chap. 1. 
restrictions, the management of those affairs shall be en- 
trusted^). This is ihr rule which prevails in cost-hook 
mining companies <), and it is nol easy to conceive what, 
except the will of the majority, can determine a matter of this 
description under the circumstances now supposed. 

The number of persons composing the managing body of aNumberof 
company is generally fixed by the company's special b 
charter, deed of settlement, or regulations, and the number 
making a quorum is also usually thereby fixed. As a general 
rule, a power entrusted to a given number of individuals 
cannot be properly exercised by any less number; and there 
are several cases in which this rule has been applied to 
companies, and in which the acts of directors have been held 
invalid on the ground that they were not done by the requisite 
number of directors (d). Hut it does not therefore follow that Varying the 
the number of directors, as originally fixed, cannot be altered by 
the majority iA' a meeting of the shareholders; and where 
the number is not fixed by the legislature or the Crown, it 
seems that the shareholders may alter it (e). Even where the 
number is fixed by an act of Parliament or a charter, the act 
or charter may be so worded as to be in this respect director}' 
only (/). 

It is to be observed that the directors of a company are all Who are 
those persons who are constituted directors by a company's 
act, charter, or deed of settlement, and not only such of them 
as choose to act. 

Sometimes provision is made for the transaction of business Persons deemed 
by persons who are to be deemed to be directors until directors 
are appointed. Such a provision does not necessarily make 
such persons directors for all purposes ; and a clause to the 

(b) Agreements by directors de- the power of directors to delegate 
priving the shareholders of this their authority, see p. 156. 

power are invalid, James v. Eve, L. (e) Smith v. Goldsworthy, 4 Q. B. 

It. 6 H. L. 335. The powers of 430. 

majorities will be examined here- (/) Thames Haven, Dock, <&c, Co. 

after. v. Rose, 4 Man. & Gr. 552. See, 

(c) See Tapping on the Cost- too, Banjate v. Shortridrje, 5 H. L. C. 
Book, p. 64. 297. 

((/) See ante, p. 155 ; and as to 

ot directors 



Bk. HI. Chap.i. effect that two directors shall be a quorum has been held not 

Sect. 1. , 

'— * to apply to persons who were to be deemed to be directors (g). 

So a clause as to the qualification of directors has been held 
not to apply to similar persons (h). 

Qualifications Generally speaking, the members of the managing body are 

required to possess certain qualifications, and to be appointed 
in some prescribed manner {%). But it by no means follows 
that persons who are in fact acting as duly qualified directors 
will be prevented from doing so, simply because they have 

Irregular been irregularly appointed (k). Still less does it follow that 

the irregularity of their appointment will render all their acts 
null and void. Persons dealing with them as directors bond 
fide, and without notice of the irregularity, are entitled to 
treat them as the agents of the company, and to hold the 
company bound by their acts, as if they were its duly appointed 
directors (/). But, as between themselves and the share- 
holders, the irregularity is of greater importance ; and it has 
been held that persons tie facto, but not de jure, directors 
cannot allot shares, make valid calls or forfeit shares, even 
where there is a provision rendering valid what may be done 
by persons acting as directors, notwithstanding the subsequent 
discovery of a defect in their appointment (to). 

(g) London and Soutliern Counties to the proceedings of a board not- 

Land Co., 31 Ch. D. 223. withstanding any vacancy among its 

(h) Lord Claud Hamilton's case, members or defect in their election, 

8 Ch. 548, and others of that class see Newhaven Local Board v. New- 

noticed infra, bk. iv., under the haven School Board, 30 Ch. D. 350. 
head Contributories. (I) See as to this, ante, pp. 161 

(i) As to disqualification by hold- and 166. 
ing other offices, see Iron Shi}) (m) See London and Southern, dr., 

Coating Co. v. Blunt, L. R. 3 C. P. Land Co., 31 Ch. D. 223 ; as to 

484 ; Bales v. Cumberland Black Co., allotments, Garden Gully, &c, Co. v. 

6 H. & N. 481, or by being in- Mc Lister, 1 App. Ca. 39 ; as to calls 

terested in contracts, see Beg. v. and forfeiture, Howbeach Coal Co. v. 

Gaskarth, 5 Q. B. D. 321. As to Teague, 5 H. & N. "151"; and Miles 

the effect of giving votes for dis- v. Bough, 3 Q. B. 845 ; Edinburgh, 

qualified persons, see R. v. Tcwkcs- &c, Rail. Co. v. Hebblewhite, 6 M. 

bury, L. R. 3 Q. B. 629. & W. 707 ; South-Eastern Rail. Co., 

(k) See Foss v. Harhottle, 2 Ha. v. Hebblewhite, 12 A. & E. 497; 

461, and Mozley v. Alston, 1 Ph. Swansea Dock Co. v. Levien, 20 L. J. 

790. These cases will be noticed Ex. 447. Compare Murray v. Bush, 

hereafter. For a discussion as to L. R. 6 H. L. 37, turning on 7 & 8 

the effect of a clause giving validity Vict. c. 110, § 30. 

Dini'.c ions. 80J 

Directors are supposed to know the regulations of their own 1;k - Hi. Chap< 1- 
company (ra) ; and it might be supposed that if a person 

i t i.i 11 ii i ii Denying quali- 

became a director and acted as such, lie would not be allowed i,,,ui.,n. 

to take advantage of the fact that he was not duly qualified to 
act in that capacity ; hut as will he seen hereafter the decisions 
on this subjecl are not all in accordance with this view. There 

are several decisions to the effect that a person may act as a 

director and be required to hold a certain number of shares 
as a qualification for his office, and still he at liberty to show 
that he did not in tact hold such shares, or agree to take 
them (<>). Where, however, a company's special act is so 
worded as to make a director a shareholder, in respect of the 
number of shares necessary to qualify him, he will he a share- 
holder in respect of that number of shares whether any 
definite shares have been allotted to him or not (p). 

A provision that no person shall be eligible as a director 
unless he holds a certain number of shares, does not apply to 
persons who sign a company's memorandum of association, 
and who by that fact alone are the persons to act as directors 
until others are appointed (</). 

Where a person is required to hold a certain number of Effect of mort- 
shares as a qualification for the office of director, those shares qualification! 
must not he nominally paid-up shares (r) ; but a director 
having the requisite number of shares is not disqualified for 
the office simply because he may have mortgaged his shares (s) ; 
it is sufficient if he retains the legal title to them. This was 
held in a case where the qualification shares were to he held 
by the directors in their own right (0. 

(«) See per Lord Westbury in C. P. D. 350. 
Lane's case, 1 De G. J. & S. 506. (q) Stock's case, 4 De G. J. & Sni. 

Compare Marquis of Abercorn's case, 426; and see Cotterell's case, 11 W. 

4 De G. F. & J. 78. R. 13 ; and Lord Claud Hamilton's 

(o) Wheal Butter Consols, 38 Ch. case, 8 Ch. 548. 
D. 42, and other cases of that sort. (>•) Roney's case, 4 De G. J. & Sin. 

See infra, bk. iv., c. 1, Contri- 426 ; Curries case, 3 De G. J. & Sm. 

butories. 367. 

(p) Portal v. Emmens, 1 C. P. D. (s) Cumming v. Prescott, 2 Y. & 

664 and 201, and see also Kincaid's C. Ex. 488. 

case, 11 Eq. 192 ; Forbes' case, 19 (t) Pulbrook v. Richmond Consoli- 

Eq. 353 ; Purcell's case, 29 W. R. dated Mining Co., 9 Ch. D. 610. 
170. Compare Kipling v. Todd, 3 



Bk. III. Ch; 
Sect. 1 


Removal of 

*P- !• "Whether a person once a director has or has not ceased to 

be so depends (except in the case of his death) upon the 

regulations of the company (»). A director who becomes 
bankrupt or ceases to attend to his duties does not thereby 
necessarily vacate his office (x). 

The power to fill up casual vacancies is frequently given to 
the remaining directors ; in such a case they can fill up a 
vacancy although a general meeting of shareholders has been 
held since the vacancy occurred (y). But if the number of 
continuing directors is less than the minimum number requisite 
for the transaction of any business, they cannot fill up the 
vacancy (s). The rules of the company may, however, allow 
the continuing directors, however few, to fill up a vacancy, 
although not to transact any other business until the vacancy 
is filled up (a). 

Power to remove directors is often expressly conferred on 
the shareholders (b). It has not yet been decided whether 
when there is no such express power there is an implied power 
in the shareholders of a company to remove a director from 
his office by a resolution duly passed at a meeting properly 
convened for the purpose, but the better opinion seems to be 
that there is (c). If, however, a director is appointed for a 
definite period, he cannot be removed before that period has 
expired unless there is some special provision to that effect (d). 
Where the shareholders have power to remove a director for 
" any reasonable cause," the shareholders are themselves the 
judges as to what is and what is not a reasonable cause for 
removal ; and their decision will not be interfered with if they 
act fairly and in good faith (e). 

(a) Phelps v. Lyle, 10 A. & E. 

(a;) lb., and see Wilson v. Wilson, 
6 Scott, 540. 

(y) Munster v. Cammell Co., 21 
Ch. D. 183. 

(s) See Newhaven Local Board v. 
Newhaven School Board, 30 Ch. D. 

(a) As in York Tramivays Co. v. 
Willows, 8 Q. B. D. 685. 

(6) There is power to remove 
under the Companies' clauses act, 
1845. See Isle of Wight Rail. Co. v. 
Tahourdin, 25 Ch. D. 320.^^ty.£»£i 

(e) See Browne v. La Trinidad, ' 
37 Ch. D. 1, and the last case. 

(d) Imperial Hydropathic Hotel Co. 
v. Hampson, 23 Ch. D. 1. Compare 
the last note. 

(e) InderwicJc v. Snell, 2 Mo. & G. 
216. See as to becoming bankrupt, 


Directors have no power to vote themselves fees for salaries Bk - m - Chap.l. 

t 2 
for their services beyond what the constitution of the company- 

The powers of directors as agents of the company have been 
already examined (Bk. II. c. 2 & 3) : their powers to call 
meetings, allot shares, make rails, forfeit shares, will be 
noticed hereafter when treating of those subjects. 


The shareholders of a company cannot usually exercise any 
control over the management of its affairs, except at meetings 
duly convened ; for the directors of a company are the servants, 
not of the individual shareholders, but of the company; and 
where the management of the directors is complained of, an 
aggrieved shareholder should seek redress through the company, 
and induce it to call the directors to accouut(^/). As will, 
however, be seen hereafter, if the directors are doing that 
which the shareholders cannot sanction, or that which they 
have by a proper resolution forbidden, the dissentients may 
obtain redress by legal proceedings (/*)• 

It may, however, happen that the constitution of a company 
is such that the shareholders are deprived of all control over 
the managing body in matters not foreign to the objects of the 
compan}'. Where this is the case, the managers have it in 
their power to disregard the wishes of the shareholders as to 
all such matters (i). 

Phelps v. Lyle, 10 A. & E. 113; Ch. 489 ; Hayrnan v. Gov. of Rugby 

absconding from creditors, Wilson School, 18 Eq. 28. 

v. Wilson, 6 Scott, 540. See the (/) See Evans v. Coventry, 8 De 

cases as to expelling members of G. Mc. & G. 835, decree, clause 3. 

clubs, Dawlcins v. Antrohus, 17 Ch. See infra, ch. 2, § 3. 

D. 615 ; Fisher v. Keane, 11 ib. 353; (g) See Orr v. Glasgoiv Rail. Co., 

Ldbouchere v. Wliarncliffe, 13 ib. 3 McQu. 799. 

346 ; and as to removing persons (h) See infra, ch. 9, § 2. 

from offices, Osgood v. Nelson, L. R. (*) Spurgin v. JVliite, 2 Giffi 473, 

5 H. L. 636 ; Dean v. Bennett, 6 is an instance. 



Bk. III. Chap. l. Individual shareholders, being comparatively powerless, pro- 

fio/>+ 9 ... 

Sect. 2 

Meetings of 

vision is generally made for bringing them together at meet- 
ings, and it is not a little important that the right to convene 
them should to some extent, at all events, be exercisable by the 
shareholders themselves. If matters are in such a state that 
nothing can be done without a meeting, and there is no express 
power to call one, it would seem necessary to imply a power in 
any shareholder to convene one. This, however, is a case 
which can seldom happen. It more commonly happens that 
there is a power to convene a meeting, but that those who have 
Interference of the power will not exercise it. In cases of this kind it has 
meetings! 1 been held that, where those who have the right to call a 

meeting of the shareholders refuse to exercise that right, for 
the express purpose of preventing the shareholders from duly 
assembling, the Court will, if necessary, interfere to protect the 
shareholders against an abuse of power on the part of those 
entrusted with the management of the affairs of the company (A;). 
So where directors give notice that a meeting will be held on a 
day when they know that a large number of shareholders will 
not be in a position to vote, the Court will interfere and 
restrain such an abuse of power (/)• Again, if directors con- 
vene a meeting to pass resolutions favourable to themselves on 
questions in which the interests of the directors are opposed to 
those of the shareholders, by a circular which is misleading, 
and which contains statements calculated to obtain proxies in 
their favour without giving the shareholders the information 
necessary to enable them to form a just judgment as to who are 
the proper persons to whom to entrust their votes, the Court 
will grant an injunction to restrain the holding of the meeting 
or to restrain the directors from laying such resolutions before 
the meeting (m). 

The Court, however, is very reluctant to interfere with the 
holding of meetings of shareholders, especially when they are 
called for the purpose of investigating and controlling the con- 
duct of the managing body ; and the Court will not interfere to 
restrain such a meeting simply because the notice convening it 

(k) Foss v. Harbottle, 2 Ha. 461 ; 
Isle of Wight Rail. Co. v. Tahourdin, 
25 Cli. D. 320. 

(1) Cannon v. Trash, 20 Eq. 669. 
(m) Jackson v. Munster Bank, 13 
L. K. Ir. 118. 


is badly framed, and invites the meeting inter alia to pass Bk - HL Chap. l. 
resolutions which would be invalid if passed (n) ; for the — 

meeting might take souk; other legal course, e.g., pass some 
amended resolution which would be valid. 

In order that a resolution come to at any meeting, whether Resolutions d 
of directors or of shareholders, ma}' have any legal effect, it is 
necessary that the meeting shall be duly convened : that a 
proper number of persons shall be present (o), and there must 
always be two at least (j)) ; that the resolution should relate to 
a matter upon which the meeting is competent to pass a reso- 
lution ; and that the resolution should be duly passed. 

In order that a meeting may be duly convened, it is necessary 
that it be convened (1) by those who have a right to convene it, 
(2) at a proper time, (3) at a proper place, and (4) by a proper 

The persons entitled to convene a meeting have been Persons to 


alluded to already ; and it is only necessaiy to add that a 
meeting convened by the proper persons will not be incom- 
petent to transact business simply because they may themselves 
have been irregularly convened to consider whether a meeting 
shall be called or not (<[). 

As regards time : where there is no express provision, a Time, 
reasonable time must be given (r) ; and perhaps if the time 
were unreasonably short and were made so purposely, the 
Court might restrain the holding of the meeting. But if a 
meeting is held, and no objection is taken to the shortness of 
the notice convening it, the Court will not interfere (s). Where 
the time for holding a meeting is prescribed, such time must be 
observed ; and there are instances in which resolutions of 
meetings have been held invalid on the ground that the 
meetings were not held at the proper times (t). 

In calculating the time for holding a meeting, where an 

(n) Isle of JFight Bail. Co. v. Ta- (r) Browne v. La Trinidad, 37 Cb. 

hourdin, 25 Ch. D. 320. D. 1. As to a meeting of directors, 

(o) See Howbeach Coal Co. v. see Ex parte Smith, 39 Ch. D. 546. 

Teague, 5 H. & N. 151, and other (s) Browne v. La Trinidad, 37 

cases, ante, pp. 157, 158. Ch. D. 1. 

{p) Sharp v. Dawes, 2 Q. B. D. 26. (t) Baihvay Sleepers Supply Co., 

(q) Browne v. La Trinidad, 37 Ch. 29 Ch. D. 204. Compare Miller's 

D. 1. Dale, &c., Lime Co., 31 Ch. D. 211. 

L.C. X 




Notice of object 
of meeting. 

Bk. III. Chap. 1. interval of not less than a certain number of days is required 

Sect. 2. . . 

to elapse between one meeting and another, the rule is that 
the prescribed number of days must be clear days, i.e., ex- 
clusive of the days of the meetings (?/). 

As regards place : where no place is prescribed, it is con- 
ceived that any reasonably convenient place of meeting may be 
fixed. But the Court would probably interfere if a place were 
purposely fixed at which it was known shareholders could not 

A meeting is not duly convened unless every person entitled 
to attend has notice not only of the time and place at which, 
but also of the purposes for which it is to be held, so that he 
may exercise his own judgment whether he will attend or 
not ; and there are numerous cases in which resolutions have 
been held invalid on the ground that insufficient notice was 
given of an intention to submit the matters to which they 
relate to the meeting at which they were passed (x). But a 
notice may be good in part and bad in part, and is not wholly 
invalid because it extends to something which cannot be 
done (y). 

A person who attends a meeting cannot dispute the validity 
of what is done on the ground that he had not due notice of 
the time and place at which the meeting was about to be held ; 
and if all entitled to notice have it in fact, but not in the 
precise form in which it ought to have been given them, the 
proceedings of the meeting will not necessarily be invalid (s). 
But still it is absolutely requisite for the j^otection of those 
heard must have w ] 10 are to be affected by the resolutions of others, that such 

an opportunity . . .. 

of being heard, resolutions shall have no effect unless aff entitled to a voice m 
making them had an opportunity of expressing their views. In 
a case where directors were empowered to meet once a week at 
their office, without notice or summons, but on such day and 
at such hour as they should from time to time agree upon, it 
was held that a resolution come to by a quorum assembled 

Every one 
entitled to be 

(m) lb. 

(x) A leading case on tins head 
is Bridport Old Brewery Co., 2 Ch. 
191. See also Garden Gully Co. v. 
McLister, 1 App. Ca. 39. 

(y) Clevex. Financial Corporation, 
16 Eq. 363 ; Isle of Wight Rail. Co. 
v. Tahourdin, 25 Ch. D. 320. 

(z) See British Sugar Refining Co., 
3 K. & J. 408. 


without notice was invalid, inasmuch as no day or hour for the Bk. III. Chap. 1. 

Sect. 2. 
meeting oi the directors bad ever been fixed (a). 

The mode in which notice is to 1"' given varies with almost Mode of giving 
every company. Such statutory enactments as exist upon the mee < 
subject will be notic< d hereafter. The only general rule which 
can be laid down is, that notice must be given in the manner 
prescribed by each companj^s act, charter, deed of settlement, 
or regulations. It seems that it is not necessary to give notice 
of the holding of an adjourned meeting to the persons entitled 
to attend it; it is apparently sufficient if they had notice of 
the holding of the original meeting (6). But nothing can, 
without notice, he transacted at an adjourned meeting except 
the unfinished business of the first meeting (c). 

There are two lands of meetings, viz., ordinary and extra- Ordinary and 
ordinary, or, as they are sometimes called, general and special, meetings. 
Ordinary or general meetings are usually held at stated times, 

and for the transaction of husiness generally. Extraordinary Nature of busi- 

. ■, . . ill • n i nesa should be 

or special meetings are held as occasion may require, for the 

transaction of some particular husiness, which ought to be 
specified in the notice convening the meeting. A resolution 
passed at an extraordinary meeting, upon a matter for the 
consideration of which it was not avowedly called, or which 
was not specified in the notice convening the meeting, is alto- 
gether inoperative (d) ; and although such resolution may have 
been confirmed at a subsequent ordinary meeting, it will still 
be invalid unless it might have been properly passed in the 
first instance at an ordinary meeting, without previous notice 
of any intention to enter upon the matter to which the reso- 
lution relates (e) : and if a meeting is convened to confirm 
resolutions previously passed, the notice ought to state those 
resolutions or their effect (/). 

(a) Moore v. Hammond, 6 B. & C. Bank of Hindustan, 6 Eq. 91 ; Anglo- 
456. Californian Gold Alining Co. v. Lea-is, 

(b) See Wills v. Murray, 4 Ex. 6 H. & N. 174 ; Stearic Acid Co., 9 
843, 862 ; Scudding v. Lorant, 3 H. Jur. N. S. 1066, V.-O. K. 

L. C. 418. (e) Lawes' case, 1 De G. M. & G. 

(c) li. v. Grimshaw, 10 Q. B. 747. 421. 

(d) Bridport Did Brewery Co., 2 (/) Dean v. Ik mutt, 6 Ch. 489, 
Ch. 191 ; Imp. Bank of China v. and 9 Eq. <52i>. 

x 2 



Bk. III. Chap. 1. 
Sent. 2. 


One and the same meeting may be both ordinaiy and ex- 
traordinary ; ordinaiy for the purpose of transacting the usual 
he both ordinary business of the compaii} T , and extraordinary for the transaction 
and extraordi- f some particular business of which special notice may have 
been given (g). If an ordinaiy meeting is held and adjourned 
the adjourned meeting continues to be an ordinaiy meeting, 
although special notice is given that it is about to be held for 
special business (/?). 

The power of making bye-laws for the regulation of the 
affairs of a company is not unfrequently reposed in its share- 
holders : and it is not uncommonly required that all bye-laws 
shall be sealed with the seal of the company. In such a case 
nothing which is not so sealed can be regarded as a bye- 
law (i) ; nor is an unsealed resolution passed at a meeting of 
the shareholders of an incorporated companj r , equivalent to a 
contract under the seal of such compairy (j). At the same 
time it is clear that, as a general rule, the resolutions of meet- 
ings of members of a body corporate do not require to be 
sealed in order to be binding on its members, as between 
themselves, and as members. Acts relating to the internal 
affairs of a corporation, affecting members only, and affecting 
them merely as members, do not in general require the com- 
mon seal to render them valid (k). 

Bye-laws not warranted by the authority which empowers 
them to be made, are altogether illegal (I). 

Where there is no special provision to the contrary, the 
resolution come to by the majority of those present at a meet- 
ing is the resolution of that meeting (???) ; and the chairman is 
the person to decide what the result is and all incidental ques- 
tions requiring instant decision ; but his decision is not neces- 

Resolution of a 

majority is a 
resolution of a 

(g) See Cutbill v. Kingdom, 1 Ex. 
494 ; Graham v. Van Diemen's Land 
Co., 1 H. & N. 541. 

(h) Wills v. Murray, 4 Ex. 843. 

(i) Dunston v. Imperial Gas Co., 
3 B. & Ad. 125. 

(J) Ibid., and see ante, p. 221. 

(k) Grant on Corp. 65. 

(I) See Colder, <tc, Nav. Co. v. 
Pilling, 14 M. & W. 7G ; Adley v. 

Whitstable Co., 17 Ves. 315, 19 ib. 
304, and 1 Mer. 107. 

(m) Horbury Bridge Coal, &-c, Co., 
11 Ch. D. 109, deciding that the 
regular method of voting is by show 
of hands, and that an article giving 
every member one vote for every 
share only applies to cases where a 
poll is demanded. 

■ii i. DINGS 0] SHAREHOLDERS. 309 

sarily final («). It is not illegal to transfer or procure shares Bk.HI. Chap. 1. 

, e . . . Sect. 2. 

before a meeting so as to multiply votes at it ; nor can votes 

so obtained be disregarded (o). 

A meeting at which there is not present a sufficient number 
of persons to transact business, cannot pass any valid resolu- 
tion (}>). 

It is conceived that an agreement to vote in a particular Interest* 
way, in consideration of some personal benefit, is illegal; for 
a vote ought to be an impartial and honest exercise of judg- 
ment (7). But as a matter of law as distinguished from con- 
science a person may vote on a question in which he happens 
to have a personal interest opposed to that of the company; 
and where the question was whether proceedings should be 
taken by the company to impeach the title of some of the 
shareholders in it, those shareholders were held entitled to 
vote in respect of the very shares the title to which was dis- 
puted (/•). So a director may vote as a shareholder on the 
question whether a contract between the company and himself 
shall be entered into or be confirmed (-s-). 

Absent members are not entitled to vote by proxy unless Proxies 
they are specially empowered so to do (t). The right of an 
absent member to vote by proxy depends on the terms of 

(n) Indian Zoedone Co., 26 Ch. D. tween two .subscribers to a charity 

70. to vote for each other's nominees, 

(0) Pender v. Lushington,6 Ch. D. was held not to be illegal. 

70; Stranton Iron and Steel Co., 16 (/■) East Pant Du Mining Co. v. 

Eq. 559 ; Cannon v. Trasl; 20 Eq. Merry weather, 2 Hem. & M. 254. 

669; Moffatt v. Farquhar, .7 Ch. D. See, also, Menier v. Hooper's Tele- 

591, and see North-West Transpoiia- graph Works, 9 Ch. 350. Compare 

tion Co. v. Beattij, 12 App. Ca. 589, Atwool v. Merryweather, 5 Eq. 464, 

noticed infra. note, and see 8 & 9 Vict. c. 16, §§ 85