1852. BEFORE VICE-CHANCELLOR SIR G. J. TURNER. SIMPSON V. DENISON and Others, THE GREAT NORTHERN June 12th, RAILWAY COMPANY, and THE AMBERGATE, NOTTINGHAM 13th, & 24th. & BOSTON, AND EASTERN JUNCTION RAILWAY COMPANY. Com And THIS was a motion for an injunction to restrain the an Act of Par liament can be obtained, to work the traffic of the Ambergate Railway Company from the 1st of July next, and to pay to the Ambergate Railway Company such toll as will, after answering all expenses and liabilities, furnish a dividend of 41. per cent. on the paid-up share capital of the Ambergate Railway Company; and, as soon as an Act of Parliament can be obtained, will guarantee a dividend of 47. per cent. on such capital. The Great Northern Railway Company to apply, at their own expense, for an Act of Parliament to ratify such arrangement; and, in case such Act is not obtained in the first session, the application to be renewed, always at the expense of the Great Northern Railway Company, unless the same be lost by the default of the Ambergate Railway Company. The Great Northern Railway Company to have the privilege of paying off the shareholders at par, on giving six months' notice at any time after the obtaining of the Act. No further call to be made on the Ambergate shares." This agreement had been approved at a general meeting of one of the Companies, but, before it was submitted to the meeting of the Great Northern Railway Company, one of the shareholders filed a bill praying an injunction to restrain the Company from proceeding with it:-Held, that the 87th section of the Lands Clauses Consolidation Act gives one Railway Company a right to contract for passing over the line of another Company, and to stop, and take up and carry passengers and goods upon that line, but not to acquire the trade of the Company over whose line they have agreed to pass. That an agreement" to pay such an amount as would, after answering all expenses and liabilities, furnish a dividend of 4l. per cent.," is not an agreement to pay " toll" within the meaning of the Act. That, if one shareholder dissent, the funds of a Company are not applicable to the purpose of applying to Parliament for powers to enter into any undertaking not forming part of the original objects for which the Company was incorporated. 1852. SIMPSON V. DENISON. of May, 1852, (hereinafter mentioned) or the arrangement intended to be thereby made, or any similar arrangement, contained or to be contained in any deed that then was or might thereafter be prepared to carry out such arrangement, with or without any variations, additions, or modifications consistent with the scope of such arrangement, and also from pledging the credit of the Great Northern Railway Company for all or any of the above purposes. The bill in this case was filed on the 28th of May, 1852, by J. Simpson and W. Wright, on behalf of themselves and all other the proprietors of stock and stockholders in the Great Northern Railway Company, except such of them as were defendants thereto, and stated, that the plaintiff Simpson was, long previously to the 5th of May, 1852, the registered proprietor of twenty 251. shares in the capital of the Great Northern Railway, converted into 5001. stock of that Company, and that the plaintiff Wright was the registered proprietor of fifty half shares in the said capital, converted into 6251. consolidated stock of the Company. The bill then stated the Acts of Parliament establishing the Great Northern Railway Company, with which the then General Consolidation Acts were incorporated, and also the Act of Parliament establishing the Ambergate Company; and that, by the last-mentioned Act, it was among other things enacted, that, from and immediately after the opening of the Ambergate Railway, the Company thereby incorporated should be liable to pay to the committee of management of the Nottingham Canal the sum of 2251. for each share in that Canal (500 in number) and to the committee of management of the Grantham Canal 1601. for each share (750 in number) within six calendar months from the opening of the Railway, but without interest in the meantime; and that the said sum, if not paid within the period and in manner before stated, should be recoverable, with interest at 5l. per cent. per annum: and by the 81st section of the said Act, provision was made for the conveyance of the canals to the Railway Company; and by the 90th section all works and things, which, under the provisions of the Acts therein recited, the Canal Companies were made liable to make, construct, complete, or maintain, and all repairs thereof, should be made, constructed, completed, or maintained by the Railway Company, as fully &c., as by the Canal Companies. The bill then stated, that a judgment had been given in favour of the Grantham Canal Company against the Ambergate Company for the sum of 120,000l. and costs, which had not been paid; and that 112,500l., with interest, was then due from that Company to the Nottingham Canal Company. That the directors of the Great Northern Railway Company had then recently determined to possess themselves of the entire control, and work the whole traffic of the Ambergate Railway, and had come to an agreement, dated the 5th of May, 1852, signed by the defendants, the chairman and one of the directors of the Great Northern Railway Company, on behalf of that Company, and by the chairman, deputy chairman, and one of the directors of the Ambergate Company; which agreement was as follows: "The Great Northern Railway Company to give the following terms, bearing harmless the Ambergate Railway Company against all liabilities, whether of canals or otherwise. The Great Northern Railway Company, until an Act of Parliament can be obtained, to work the traffic of the Ambergate Railway Company from the 1st of July next, and to pay to the Ambergate Railway Company such toll as will, after answering all expenses and liabilities, furnish a dividend of 4l. per cent. on the paid-up share capital of the Ambergate Railway Company; and, as soon as an Act of Parliament can be obtained, will guarantee a dividend of 4l. per cent. upon such capital. The Great Northern Railway Company to apply, at their own expense, for an Act of Parliament to ratify such arrangement; and, in case such Act is not obtained in the first session, the 1852. SIMPSON V. DENISON. 1852. SIMPSON v. DENISON. application to be renewed, always at the expense of the Great Northern Railway Company, unless the same be lost by the default of the Ambergate Company; the Great Northern Railway Company to have the privilege of paying off the shareholders at par, on giving six months' notice at any time after the obtaining the Act. No further call to be made on the Ambergate shares." That the agreement had been confirmed at a special general meeting of the Ambergate Company, and that the Boards of Directors of the two Companies were about to cause the terms of the agreement to be embodied in a deed, and to affix their respective common seals thereto. The bill prayed, that the agreement of the 5th of May, 1852, might be declared illegal and void, and an injunction in the terms of the present motion. The affidavits filed on behalf of the defendants, the Great Northern Railway Company, stated that, according to the best of the deponents' judgment and belief, the sum which would be requisite to be paid by the Great Northern Railway Company, in order to make up a dividend of 41. per cent. upon the capital of the Ambergate Company, beyond the profits of the same Company, exclusive of the Great Northern trains, would not exceed but rather be less in amount than the maximum tolls which were payable under the Acts of Parliament of the Ambergate Company, in respect of the several articles of traffic which would be carried by the Great Northern trains over the line of the Ambergate Company. That the Great Northern Railway Company did not intend to take the whole control over, and the working of, the whole traffic of the Ambergate line, but that they did intend to work the trains of the Great Northern Railway over the line of the Ambergate Railway, in conformity with such rules and regulations as had been or should be laid down or established by that Company; and to carry, by means of the same trains, as well the traffic of the Great Northern Railway Company, as also such of the traffic of the Ambergate Company as could be conveniently conveyed and accommodated by the same trains, leaving the Ambergate Company in the control and management of their line, and to work all other traffic thereon. Sir W. P. Wood and Mr. Jessell, in support of the injunction, contended-That the agreement was such an one as no Company could fulfil without the express authority of Parliament. That the 87th (a) and 88th sections of the Railways Clauses Consolidation Act (8 & 9 Vict. c. 20), gave no such authority; that the object of those sections was to facilitate the proper through-traffic of the passengers, and to give to one Railway Company the power of passing, without hindrance, over Railways belonging to other Companies; but did not contemplate an assumption of the control over the passengers or traffic of the Railways over which they passed. That this agreement was, in fact, a delegation of powers on the part of one Company, and an undertaking by another Company of risks and liabilities which the Act under which they had been constituted never contemplated. In Beman v. Rufford (b), it was clearly held, that one Railway Company could not transfer its powers to another. That signal trains of starting and general working of the line were to be regulated by the Board of Directors of each particular Company, in whom a responsibility, which could not be delegated, was vested. That such an agreement as this, even when consented to by the majority of the shareholders, could not bind one dissentient shareholder. That the funds of the Company were solely applicable to the purposes for which they had been originally subscribed; but that, by the present agreement, the funds of the Great Northern Railway Company would be applicable to the payment of certain (b) Ante, p. 48. (a) See post, p. 412. 1852. SIMPSON v. DENISON. |