The plaintiff, who was at the time engaged in business, entered into negotiations with the defendant with a view to the formation of a partnership between them, which resulted in a document being prepared and signed by both parties, on the 23rd of March, 1868, containing the terms on which they agreed to become partners as from the 1st of August following. This document, after providing that the plaintiff should be liable for all business debts contracted, and be entitled to the profits earned previous to the commencement of the partnership, and that the defendant should bring in a sum equal to the then value of the stock-in-trade, contained a clause stipulating that the defendant should pay the plaintiff 500l. "as goodwill for a moiety of the profits of the business during a partnership of ten or twelve years." Then, after stating the manner in which the 500l. was to be paid, it was agreed that the plaintiff was to be allowed the sum of 300l. per annum "for his extra services and management." The other clauses provided for the introduction of further capital, payment of interest thereon and the division of profits. The defendant, by letter, dated the 2nd of June, refused to carry out the agreement, on the ground that he had suffered heavy pecuniary losses. After some correspondence between the parties the plaintiff filed the bill in this suit, praying for specific performance of the said agreement and for a declaration that he was entitled to damages for the defendant's refusal to carry it out in addition to or in substitution for a decree for specific performance. The defendant demurred. Mr. Kay and Mr. Martineau, for the demurrer. It is uncertain whether the partnership is to last for ten or twelve years. Who is to decide that? What are the "extra services"? The terms are too vague and uncertain Sichel v. Mosenthal, 30 Beav. 371; s. c. 31 Law J. Rep. (N.S.) Chanc. 386. But if there were no uncertainty, the Court would not decree specific performance of an agreement to enter into partnership. The remedy for breach of such an agreement is by an action at law— Ogden v. Fossick, 32 Law J. Rep. (N.S.) Lindley on Partnership, 796, 1st edit., The case of England v. Curling, 8 Beav. 129, was very different from the present. Mr. W. M. James and Mr. A. E. Miller, for the bill.There is no uncertainty in the terms. The defendant has his option of ten or twelve years; when he makes his choice the plaintiff is bound to accept it. "Extra services" mean those of the plaintiff as managing partner. The bill is filed on the authority of England v. Curling, ubi supra. The plaintiff is entitled to a decree that the defendant shall execute a deed of co-partnership, as was decreed in that case. We say that the Court has jurisdiction to make such a decree, but it may be that, in its discretion, under stat. 21 & 22 Vict. c. 27, it may consider damages the more fitting remedy in the present case. Notwithstanding what is said by Mr. Lindley in his book on Partnership, we submit that, as a general rule, the Court will decree specific performance of an agreement to enter into partnership, first, where there is a term for its duration fixed; secondly, where there is an agreement to execute a deed of co-partnership. In the first case, see Anon. 2 Ves. sen. 629 (case 218), Hibbert v. Hibbert, Collyer on Partnership, 133, 2nd ed. Hercy v. Birch, 9 Ves. 357. Lord Eldon was not content with his own decision dismissing the bill in the last case. See 1 Madd. Ch. Pr. 525, 3rd edit. In the second case see Stocker v. Wedderburn, 3 Kay & J. 393; s. c. 26 Law J. Rep. (N.S.) Chanc. 713. And Mr. Swanston's note on Crawshay v. Maule, 1 Swanst. 513. The Court is not asked to decree that the parties shall do something which the Court is unable to overlook and see carried out; it is merely asked to make the parties execute a deed which brings them into a certain relation to each other from which certain legal effects flow. The deed being executed the agreement would be performed and the Court's work at an end. Court, then, has jurisdiction to entertain this suit, but if it should think damages the more appropriate remedy it may give the relief in that form, and will not send the plaintiff to the Courts of common law. The GIFFARD, V.C.-As a general rule the Court will not decree specific performance of an agreement to enter into partnership. In Hibbert v. Hibbert and England v. Curling there had been part performance, and it was essential to justice that the terms of the agreements which had been partially performed should be ascertained and fixed by a deed. Here I do not say whether the terms are certain or uncertain -the plaintiff has his full remedy at law without having a deed executed. There is no obstacle which this Court can remove out of his way. The case is very different from that of an agreement to execute a lease where the deed has sometimes to be ante-dated. This not being a case in which I could decree specific performance, there is no jurisdiction to give damages. If the plaintiff is entitled to damages he has his full remedy at law. Demurrer allowed without prejudice to any action the plaintiff may be advised to bring at law. Solicitors-Mr. J. H. Jones, for plaintiff; Messrs. Cunliffe & Beaumont, for defendant. NEW SERIES, 38.—Chanc. Directors of a company have no power to refuse to register transfers of shares made bona fide unless there are special provisions to that effect in the regulations of the company. A petition to wind up a company having been presented, stood over in order that the company might pass resolutions for a voluntary winding-up. After such resolutions had been passed, an order was made on the petition to continue the voluntary windingup under supervision:-Held, that the commencement of the winding-up under supervision dated from the passing of the confirmatory resolution to wind up voluntarily. This was an appeal from the decision of the Master of the Rolls, reported 37 Law J. Rep. (N.S.) Chanc. 559. The question was whether the directors of the company had power, under the circumstances stated in the former report, to refuse to register a transfer which had been duly executed by Mr. Weston as transferor and Mr. Birnie as transferee. The ground alleged by the directors for their refusal was that they were unable to ascertain Mr. Birnie's address. It appeared that the company made inquiries at the address given, which was the place of business of a relation of Mr. Birnie, and found that he did not live there, but that he was employed there, though not permanently. The articles of association contained a provision that the directors might refuse to transfer the shares of any shareholder unless the certificate of the shares was produced; and another provision, that persons becoming entitled to shares otherwise than by transfer might require the company to register the shares in the name of a nominee instead of themselves. Beyond these there was nothing to regulate the registry of transfers of shares. The transfer in question was, with the certificate of the shares, left for registration on the 19th of June, 1866. H On the 19th of July, 1866, a petition to wind up the company was presented. This was ordered to stand over generally, in order that the company might pass resolutions for a voluntary winding-up. This was afterwards done, the resolution confirming a special resolution to wind up being passed on the 30th of November, 1866. Afterwards an order to wind up under supervision was made upon the petition. It appeared that previously to the month of June the company was in difficulties, but was allowed by its creditors to continue to carry on business under a species of inspection on their behalf. Besides the transfer to Birnie, there was another transfer by Mr. Weston of thirtyfive shares to a Mr. Harvey. This transfer was sent in for registration on the 19th of August, after the presentation of the petition. The directors did not register this, assigning as one reason that they believed it was not made bona fide. Mr. Roxburgh and Mr. Marten, for the appellant, Mr. Weston.-There was here no ground for refusal on the part of the directors to register these transfers. Assume, for the sake of argument, what however is sufficiently disproved, that Mr. Birnie was objectionable as a member of the company on the ground of irresponsibility. We say the directors had still no power to refuse to register. It is well settled that a shareholder may, if he pleases, transfer his shares to a pauper in order to avoid liability, so that the transfer be a bona fide parting with all interest in the shares. Of course, where the regulations of the company provide that the directors may exercise their discretion as to transfers, such a case could not occur. But there is no such regulation here, and the law does not, as his Lordship seems to have thought, imply it— In re the Mexican and South American The passing the resolution to wind up before the transfer was actually registered does not affect our right, because it ought to have been registered long before— In re the Joint-Stock Discount Company, 36 Law J. Rep. (N.s.) Chanc. 32; s. c. 2 Law Rep. Chanc. 16. In re the China Steam Ship Company (Dawes's case), 37 Law J. Rep. (N.S.) Chanc. 901; 6 Law Rep. Eq. 232. The winding-up can only date from the day when the second resolution, constituting a special resolution to wind up, is passed. Hodgkinson v. Kelly, 37 Law J. Rep. (N.S.) Chanc. 837; s. c. 6 Law Rep. Eq. 496. Therefore Mr. Birnie's transfer was left for registration six months before the commencement of the winding-up. As to Mr. Harvey's transfer, the objection on personal grounds is even weaker than in Mr. Birnie's case. Our argument applies equally as to the directors' refusal. And if we are right in our contention as to when the windingup commenced, Mr. Weston is, as to these shares, also entitled to have his name removed from the register. Mr. Westlake (The Solicitor General, Sir R. Baggallay, with him), for the official liquidator. This was a proper exercise of the discretion which all directors must possess in regulating the affairs of the company, particularly when it was in difficulties, and, in fact, in a state of quasi bankruptcy. The evidence shews that Mr. Birnie had the appearance of being a man of no responsibility. The resolution to wind up, at all events, prevented any order being made upon the motion of Mr. Weston. If he has any rights they must be against Mr. Birnie, but the register of the company cannot now be altered. Mr. Harvey's transfer was not sent in till after the petition had been presented. This case, therefore, though weaker as to the point of Mr. Harvey's position, is stronger on that of time, because when Mr. Harvey's transfer was sent in, the winding-up now in progress had actually commenced, as the windingup, under the supervision, must date from the presentation of the petition. He referred to Sections 84, 130. and 153. of the Companies Act, 1862 (25 & 26 Vict, c. 89.) No reply was called for. LORD JUSTICE WOOD.-As regards the time when the winding-up, under the supervision of the Court, must be considered to have commenced, it is satisfactory to me that I agree with his Lordship. I think it must date from the second, the confirmatory resolution, by which the voluntary winding-up was resolved on. When there has been a petition to wind up presented, and nothing done on it, followed by a resolution to wind up voluntarily, and a subsequent order made on the petition to continue the winding-up under supervision, the reasonable conclusion is, that the commencement of that which is being continued, viz., the voluntary winding-up, is the date of the commencement of the winding-up; this, as I before said, is that of the confirmatory resolution. In this I agree with what the Master of the Rolls has, in a former case, Hodgkinson v. Kelly, expressed as his opinion. It would be absurd to talk of continuing a thing as from a time when the thing itself had no existence. The natural construction of the act is, that the winding-up which is continued is that which began, in accordance with a previous section of the act (the 130th), on the 30th of November, and was continued as from that date. The winding-up, therefore, since it began so long after the transfer was left for registration, cannot affect the question between the parties. We come next to the main part of the case. Were the directors justified in refusing to complete the transfer of the fifty shares to Mr. Birnie? What was the power, I will not say the duty, of the directors as to registering or not registering this transfer? It is said, at this very time the company were carrying on their business under a species of letter of licence from their creditors, and that therefore they were in such a condition that they ought not, without great precaution as to the character of a proposed shareholder, to admit him upon the register. The creditors in substance said, Do not admit on your register any one whose competency to pay calls is at all doubtful. But as they chose to give a letter of licence, and not to take the measure which was open to them of winding up the company, they must accept the position of the company as being exactly the same as if no such arrangement had been made; and we must consider the question exactly as if that circumstance were entirely out of the case. Had, then, the directors, as part of their ordinary powers, the right to inquire into the position of a proposed transferee of shares and make the registration of the transfer depend upon the result of their inquiries? I feel bound, with great regret, to come to an opposite conclusion to that of the Master of the Rolls with regard to the law on this. He seems to have thought that, not only they were competent, but that it was their duty to do this.-[His Lordship then referred to the judgment of the Master of the Rolls.]-I have always understood that the very working of these companies was this, that many persons entered into them because they were unlike ordinary partnerships, but partnerships from which they could retire at will by transferring their shares. They could sell their shares in the market, and no person, either director, shareholder or creditor, had any right to object, unless, of course, it was otherwise provided by the regulations of the company: the only restriction upon their so freeing themselves from liability being that it must be a bona fide transaction, by which I mean an out-and-out disposal of property, they not retaining any interest in the shares disposed of. When it was desired (as was quite possible, if thought fit,) to put a restraint upon this unlimited power of disposal there was always inserted in the articles of association a clause for that purpose. Many instances of this kind have been discussed in the Courts; one I think-Shortridge v. Bosanquet (1)—went to the House of Lords, and there the directors were bound to exercise a discretion. In the absence of such a discretion, however, I think it is plain the statute gives, in the first instance, an absolute power of disposing of shares. The very object of persons entering into these partnerships is to have transferable shares, and it has always been thought that this was the policy of the legislature in making special provisions for joint-stock companies. The shares then are transferable by statute, and the articles only point out the mode in which they shall be transferred, and the limitation, if any, to which the transfer shall be subject before registration. It was argued that all the shareholders (1) His Lordship referred to Bargate v. Shortridge, 5 H.L. Cas. 297; s. c. 24 Law J. Rep. (N.S.) Chanc. 457, affirming Shortridge v. Bosanquet, 16 Beav. 84; s. c. 22 Law J. Rep. (N.S.) Chanc. 48. might have excluded any proposed transferee, and what all the shareholders might do the directors might do; but I think the shareholders have no such power unless something is provided by the deed. When we look at this deed we find two sections only which have any relation whatever to this subject.-[His Lordship then read the sections before mentioned.] — But those sections have nothing whatever to enable the directors to approve or disapprove of a transferee. The one gives them the power of asking for the certificate, equivalent to asking for proof of the identity of the transferor; the other enables executors to sell shares without themselves being put upon the registry, which perhaps otherwise might not be allowed. Nothing can be stronger, if anything be wanted, to shew that the directors have no such power as is now contended for. It would, I think, be a serious thing if a restriction, not found in the articles, not in the statute, were to be implied by law, taking away that which to a great extent constitutes the value of these shares,—their being marketable, and passing from hand to hand. Moreover, I might remark that the duties of directors would become more onerous as duties of trustees for the company than any which usually are imposed upon them. I never heard of their making inquiries as to the address of a shareholder under ordinary circumstances. We come now to the question whether there was any ground for refusing the transfer. [His Lordship then commented on the fact, arriving at the conclusion that the transfer was bona fide made to Mr. Birnie, and concluded by saying]—Under all these circumstances, I think that Mr. Weston did all that was necessary to entitle him to get rid of the shares, that they were properly and regularly transferred to Mr. Birnie, and that Mr. Weston was consequently entitled to have his name removed from the register, as having parted with his shares. As to Mr. Harvey's case, what I have said about the commencement of the winding-up disposed of that also. LORD JUSTICE SELWYN.-With respect to the shares transferred to Mr. Birnie, the view I take of the evidence renders it unnecessary to decide the general question whether the directors had the general power to refuse the transfer. I feel, however, bound to state that, like the Lord Justice, I am unable to concur with the Master of the Rolls in treating the directors as agents of the company, and as such agents having that general and unlimited power. I think there have been a great number of cases in this Court which have proceeded upon the particular definitions and limits put upon acts of the directors with respect to the refusal to transfer. All such discussions would have been unnecessary and many quite irrelevant if there had been, without any expression in the articles of association, from the very constitution of the company, any such power given to the directors. In the present case the matter does not rest there, because we have the general act, an essential part of which is that the shares should be transferable, and the 122nd section merely refers the company to their own articles as to the mode in which that transfer shall be effected, leaving the general right of parties to rest upon the act. When we look at the provisions of these articles, we find two cases in which the directors may refuse to register. I think that this strongly shews that nothing more was intended. Of course, if the directors had reason to think that the transaction was anything like fraudulent or fictitious, they might refuse to transfer; but there is nothing suggested here on this, and in the absence of that they are bound to register. -[His Lordship then examined the circumstances, arriving at the conclusion that even if the directors had the power of refusal, there was nothing in the case which would justify their refusal.] On the point, as to the commencement of the winding-up, I am entirely in accordance with the opinion of the Master of the Rolls in the case referred to. The 130th section expressly declared that a voluntary winding-up shall commence at the passing of the resolution to wind up. The order of the Court upon which the respondents rely is an order continuing that winding-up. What is directed to be continued? voluntary winding-up, which certainly commences from the date of the resolution; that and that only is directed to be continued. The I think it is impossible for us to fix any date except that fixed by the 130th section. For these reasons, I agree that |