the winding up. But here, I must confess, I cannot say that this debt is so clearly made out to my mind as being a valid debt at law and in equity that I think the Court was bound to direct the winding up if there be any mode by which the validity of the debt could be better established before that order was made; and I think that if a discretion is even to be exercised as to the course to be pursued preliminarily to deciding whether there is to be an order for winding up or not, it is such a case as this, where, ex concessis, this is the sole debt. When I say "the sole debt," there are also two small annuities upon the lives of two parties, amounting together to about 40%. a year, but I think those may be disregarded in considering this question. Therefore, this is, in fact, a single creditor claiming under a judgment of a rather suspicious character to put the machinery of the Joint-Stock Companies' Act in motion for the purpose of winding up this company in order that he may have his debt paid.

But

I must confess that although there are two modes in which this investigation might take place, I think the one which has been suggested by my noble and learned friend is by far the most convenient, because I think it is by far the least expensive. The debt may be investigated either by proceedings instituted by those who impeach it in order to set it aside, or by making a winding-up order, so that the official liquidator under the winding-up order may himself institute proceedings to investigate the matter. In general, perhaps, that would be the cheapest and wisest course. here, considering that this was the only debt to which the attention of the official liquidator would have to be directed, I think that by far the cheapest and most expeditious mode would be to leave it to the person impeaching this debt, within a very short time, to raise the question by filing a bill. If he successfully impeaches it, there will be an end to the case; and if not, the form of order which has been suggested by my noble and learned friend provides very properly for the case, and all the costs that have been incurred will then fall upon the company if the winding-up order is established: otherwise, it will be in the discretion of the Court to direct by whom they are to be paid.

NEW SERIES, 35.-CHANC.

LORD KINGSDOWN. I entirely agree with my noble friend who has last addressed your Lordships. Everybody must feel that this is a case (as it is here stated) in which there is the gravest possible doubt as to the genuineness and fairness of this transaction. It is clear that it must be investigated, and thoroughly investigated, and the only question is in what manner that investigation will best take place. Now if it be the fact (as I presume it is) that under a winding-up order the expenses would come out of the estate, and the costs of those proceedings were to be included in those costs, it might turn out, I do not say at all that it will, but it might turn out that the grossest injustice would be done, and that in fact an alleged creditor, who really had no debt at law or in equity, would have thrown upon this company the expenses of winding-up in a case in which there was really no foundation whatever for the charge against them. I quite agree therefore with my noble and learned friend who has last addressed your Lordships, that the order proposed by the Lord Chancellor is the proper order, and I trust that the result of that order will be that justice will be done.

Ordered-That the order of the Lords

Justices be reversed, except so far as it discharges the order of the Master of the Rolls, and that in lieu thereof the petition be ordered to stand over until the 8th of May, 1865; the respondent undertaking in the mean time to take proceedings for impeaching the judgment; and that either party may be at liberty, after the 8th of May, to apply to the Master of the Rolls. The costs of the appeals to this House and to the Lords Justices to be costs in the winding-up, in case an order for winding up be made. Costs paid by the appellant to the respondents to be repaid.

Solicitors-Messrs. Edwards & Edwards, for appellant; Messrs. Terrett & Chamberlain, for respondents.

4 E

A deed of assignment for the benefit of creditors, dated the 12th of March, 1864, was made between Nevil Simmonds of the first part, the trustees of the second part, and the several other persons whose names and seals were thereunto subscribed and set, being creditors of the said Nevil Simmonds, and all other persons creditors of the said Nevil Simmonds, of the third part. After reciting that Simmonds was indebted to the parties thereto of the second and third parts in the several sums set opposite their respective names in the schedule thereto, it was witnessed that Simmonds thereby assigned all his estate and effects to trustees, upon trust to sell, and out of the proceeds to pay and retain to themselves the said trustees and their partners, and the other persons parties thereto of the third part, the several debts or sums set opposite their respective names in the said schedule, and to pay the residue, if any, to Simmonds. And it was provided, that any creditors not executing or assenting in writing, under their hands and seals, to the deed within three calendar months from the date of the deed, should be excluded from all benefit of the deed; and that it should be lawful for the trustees, at the expense of the trust estate, to require the amount of any debts of any of the creditors parties thereto to be verified by solemn declaration, or in such manner as to the trustees should scem expedient. The deed contained a

release to the debtor by the creditors parties thereto of the second and third parts.

The debtor, Nevil Simmonds, died; and this suit was instituted to administer his estate. Francis, a creditor, whose name was not in the schedule, and who had not assented to the deed, brought in a claim upon the estate, which was allowed to be good if the deed were invalid as against him. The Chief Clerk held the deed to be invalid, and allowed the claim.

The cause now came on for further consideration.

Mr. Archibald Smith, for the trustees of the deed, said that the current of decisions on the 192nd section of the Bankruptcy Act, 1861, had lately changed in favour of upholding the validity of these deeds. Two conditions were required for their validity-the first, that the deed must be for the equal benefit of creditors; the second, that its provisions must not be unreasonable. As to the proviso here, that creditors who did not come in and consent within a given time should be excluded, he admitted that, where the deed was in the form of a trust for such creditors who should execute it within a given time, the deed was invalid against a non-executing creditor. But in this case the deed was for the benefit of all creditors, with a proviso that those who did not execute it within a given time should be excluded from all the benefit thereof. Such a clause was really only in terrorem; it would not prevent a creditor, executing after the time named, taking the benefit of the deed.

Ex parte Morgan, 1 De Gex, J. & S.
288.

Ex parte Spyer, Ibid. 318.
Whitmore v. Turquand, 3 De Gex, F.

& J. 107; s. c. 1 Johns. & H. 444; 30 Law J. Rep. (N.S.) Chanc. 345. As to the other proviso, that the trustees might require verification of the debt in such manner as they should think expedient, this was not a ground for, holding the deed invalid

Coles v. Turner, ante, C.P. 169.
Strick v. De Mattos, 3 H. & C. 22;

s.c. 33 Law J. Rep. (N.S.) Exch. 276. Mr. Morgan Lloyd and Mr. W. W. Karslake, for the creditor Mr. Francis, argued that the deed was invalid as against him on three grounds. First, he was not an

Secondly, the creditors were required to execute the deed before a certain day, or else to be excluded from the benefit thereof. The principle of the last three cases applied to this objection also. Ex parte Spyer was no authority on this point; the deed was considered so vague that the Court could make nothing of it. Moreover, in that Moreover, in that case there was a provision, wanting here, that the estate should be administered as in bankruptcy. Thirdly, there was a further condition imposed on creditors, that they must prove their debts in such a manner as the trustees should appoint. That this made the deed invalid was shewn by

Leigh v. Pendlebury, 15 Com. B. Rep.
N.S. 815; s. c. 33 Law J. Rep. (N.S.)
C.P. 172,

where the proviso was in precisely the same words as in this case.

Mr. W. Pearson, for the executors of Nevil Simmonds.

Mr. Archibald Smith, in reply, on the first objection, said that

Reeves v. Watts, 1 Law Rep. Q.B. 412, was in his favour. Buvelot v. Mills was distinguishable from the present case on two grounds: first, that in that case there was no trust, and that, therefore, the equitable doctrine that a creditor could come in after the time named would not apply; secondly, that the limitation there was inserted in the

release as well as in the covenant. The trus

tees here could insert the name of a creditor in the schedule at any time. In the three cases cited from the Law Journal Reports in support of the first objection, the creditors as a body were not parties to the deed. As to the third objection, he said that Leigh v. Pendlebury had been gradually undermined, and now was virtually overruled by Strick v. De Mattos and Coles v. Turner.

The proviso in Ex parte Spyer was identical with this. By the 136th section a resort was given to Bankruptcy in all cases.

The MASTER OF THE ROLLS said that the state of the authorities was very unsatisfactory. The case of Coles v. Turner, perhaps, amounted to this, that the trustees of a composition deed are entitled (on the authority of Strick v. De Mattos) to require a statutory declaration of a debt: and the Court in that case considered that the words "or otherwise, as the trustees shall think fit," referred to the manner of making such declaration. In the present case the trustees had power to require any manner whatever of proving the debt, and the case of Leigh v. Pendlebury had held this unreasonable. This bore on Mr. Lloyd's first point, as to the cestuis que trust. It was true that all creditors were parties to the deed in the sense that they might become parties thereto, but the trust was confined to those whose names were inserted in the schedule. No one could have the benefit of the deed who was not a cestui que trust; no one would be a cestui que trust whose name was not set down in the schedule; and as to this the trustees had arbitrary powers. The case of Buvelot v. Mills applied; and the Chief Clerk's finding must be confirmed.

Mines-Agreement for Lease-Constructive Possession by Entry under an Agreement for a Lease-Boundary-Mistake in Quantity" Or thereabouts."

The mines under a farm of 181 acres were supposed to be divided by a fault running north and south in such a way as to leave about 83 acres on the west and 98 acres on the east; and the owners, by several agreements, agreed to demise to S. the mines lying to the westward of the fault, "supposed to be 83 acres or thereabouts," and to

D. the mines lying to the east of the same fault, "supposed to be 98 acres or thereabouts," and each lessee was to pay, in addition to a royalty, a dead rent amounting to about 21. per acre on the estimated area of the mines demised to him. No lease was executed to either of the lessees, but they entered upon and commenced working the mines agreed to be demised to them respectively. S. in the course of his workings arrived at a fault, which, if taken as the boundary between the mines agreed to be demised to him and those agreed to be demised to D, would leave him only 8 acres, instead of 83; and he worked through the fault. D. then filed a bill for an injunction to restrain him from so working, and one of the Vice Chancellors granted the injunction; but, upon appeal, this decision was reversed, the Court being of opinion that, assuming the fault worked through by the defendant to be the same as the fault indicated in the agreement (which was not clear), the plaintiff was not entitled to a lease of mines so largely exceeding the estimated acreage of the mines agreed to be demised to him as the mines lying to the eastward of the fault, and he could not be considered as constructively in possession of more than the lessors had by their agreement bound themselves to demise.

In construing the words "or thereabouts," when used to qualify the statement of the estimated quantity of mines agreed to be demised, the same principles ought to be acted upon as would guide the Court in construing the same words in an agreement for sale or demise of the surface.

The bill in this case was filed for the purpose of restraining the defendant Thomas Shepherd from working mines to the eastward of a certain fault, which the plaintiff claimed to be the boundary between the workings agreed to be demised to himself and the defendant respectively.

The plaintiff and the defendant Shepherd were coal-miners, and were respectively entitled to the coal and ironstone under the lands on the eastern and western sides of a farm called Blaenamman Fach Farm, in the parish of Aberdare, in the county of Glamorgan, the plaintiff's mines being on the eastern and the defendant Shepherd's mines on the western side. The other defendants were the owners of Blaenamman Fach Farm. To the south of Blaenamman Fach Farm lay the Forchamman Farm Colliery, the workings of which, so far as they had proceeded up to the time of the agreement hereinafter mentioned, disclosed a 60 yards' upthrow fault to the east or downthrow fault to the west, which, if continued in a straight line northwards through the Blaenamman Fach Farm, would divide it in such a way as to leave about 83 acres on the west and 98 acres on the east.

A fault in a coal-mine is a natural dislocation of the strata, severing by a vertical drop or slip one portion or platform of coal from another, as was well illustrated in the following exhibit B, in the defendant Shepherd's answer, being a vertical section illustrating the supposed position of the strata in an east and west direction across Blaenamman Fach Farm:

A fault is a good boundary-line, because it forms a barrier between two collieries where otherwise a barrier of coal would have to be left; and where the strata on the east side of the fault are higher than the strata on the west side it is called an upthrow fault to the east or a downthrow fault to the west, according as it is approached from the west or east side.

By a memorandum of agreement, dated the 14th of September, 1861, and made between Evan Williams David, as the agent for the defendants Miss Turbervill, the Rev. Sir George Lewen Glyn, Bart, and William Read King, the owners of Blaenamman Fach Farm, of the one part, and the defendant Thomas Shepherd and David Evans (since deceased) of the other part, it was agreed, among other articles, as follows:

"1. That the said Miss Turbervill, Sir George Lewen Glyn, and William Read King shall grant, and the said Messrs. Shepherd and Evans shall take, a lease of the coal, ironstone and fireclay in and under a portion of the Blaenamman Fach Farm, situate in the parish of Aberdare, which lies to the westward of a downthrow fault to the west, supposed to run through the said farm in the direction shewn upon the plan. The exact quantity cannot at present be ascertained, but it is supposed to be 83 acres or thereabouts.

"2. That there shall be included in the said lease the following powers to lesseenamely, power to enter upon such portions of the surface not exceeding ten acres, as shall hereafter be determined, as herein provided, for the purpose of sinking pits and shafts, driving levels, &c.

"3. That the term shall be fifty years, from the 1st of November, 1861.

"4. That the certain rent shall be 1857., and shall commence to be payable from the 1st of November, 1861.

"5. That the royalties shall be for large coal, from the 4 feet, 6 feet, and Rhos Las, 8d. per ton; from all other seams, 7d. per ton; small coal from all the seams, 4d. per ton; ironstone, 9d. per ton; fireclay, 4d. per ton; building stone, 3d. per ton; wayleave, 1d. per ton.

"27. That before the lease is granted a plan of the property shall be made from actual survey, at the lessee's expense. Upon

that plan the 10 acres which the lessee is to be at liberty to enter upon shall be defined."

By another memorandum of agreement, dated the 19th of July, 1862, and made between the agents for the owners of the one part and the plaintiff of the other part, it was agreed, among other things, as follows:

"1. That the said E. M. Turbervill, Sir G. L. Glyn, and W. R. King shall grant, and the said David Davis shall take, a lease of the coal, ironstone, and fireclay in and under the portion of the Blaenamman Fach Farm, situate in the parish of Aberdare, which lies to the eastward of an upthrow fault to the east, which fault is supposed to run through the said farm in the direction shewn upon the plan annexed hereto. The exact quantity cannot at present be ascertained, but it is supposed to be 98 acres or thereabouts."

And the agreement contained other articles similar, mutatis mutandis, to those contained in the defendant's agreement, and the plan referred to was the same in both agreements.

At the respective dates of these agreements the continuous course of the veins of minerals under Blaenamman Fach Farm was known or believed to be interrupted by two faults, which entered the land from the Forchamman Colliery works on the south, and were supposed to run completely through Blaenamman Fach Farm, and to meet at a point to the northward. By one of these faults, being that already described and mentioned in the defendant's agreement as a downthrow fault to the west, and in the plaintiff's agreement as an upthrow fault to the east, (a section of which fault is roughly shewn as the western fault on the plan) the levels of the veins of minerals were so interrupted that the levels on the east or north-east side thereof were considerably higher than the levels thereof on the west or south-west, the difference of level being supposed to be about 60 yards, and in the plans annexed to the agreement it was described as "an upthrow fault to the east 60 yards." The other fault ran entirely through the portion of the mines agreed to be demised to the plaintiff, and is not necessary to be here particularly referred to.