Page images

In re The Northern Coal Mining Company; ex parte Bagge.

cause to be delivered to the proprietors. At that time, and for a long time afterwards, only scrip certificates were delivered, certifying that the holder [not named] was entitled to shares. Mr. Bagge received such certificates for 400 shares, on the 13th of June, and for 600 shares more on the 12th of September, 1839. Mr. Bagge, for a year or thereabouts, continued to be the holder of these certificates; and in respect of the shares comprised therein he paid a certain number of calls and received one dividend. Here, then, was a member of the company who had executed the deed, paid calls, and received a dividend, and there was no doubt of his being subject to some liability. In August, 1840, a fourth call having become payable, he wished to part with some of his shares, and through the medium of Mr. Seppings he proposed to the company or to the directors to return to them a certain amount of the shares which had been granted to him; and his proposal was complied with as to 260 shares, part of his 1000 shares. The operation was effected or intended to be effected by means of a purchase made by the company of 260 shares from Mr. Bagge, for 28601., the amount of three calls paid, and 1060l., the amount of the fourth call then due, making 39207. The scrip for the 260 shares was thereupon given back to the company. The transaction was entered in the journal book of the company, under the head of shares bought in the market, on the 29th of September, 1840, and in the book called the share book the 260 shares are entered as bought back by the company. These transactions relating to the 260 shares and the sale of fifty-five shares by Mr. Bagge to a Mr. Webber were previous to the formation of any share register book and to the issuing of any certificates such as those which are described in clause 12 of the deed. Mr. Bagge had scrip certificates for 685 shares remaining in his possession in 1841, when the scrip was called in for the purpose of ascertaining who were the holders, and for the purpose of forming a share register book; and in 1842 he became a duly registered holder of the 685 shares, and proper certificates were delivered to him of his being the holder of those shares. Of these 685 he afterwards disposed, and on this occasion no question is raised either as to the 685 registered shares or as to the 55 shares which were sold to Mr. Webber. In June, 1842, Mr. Bagge was memorialized as a proprietor, under the 5 & 6 Vict. c. 21, and on the 19th of January, 1843, he was memorialized as having ceased to be a proprietor, and it would, therefore, seem that all his registered shares had been disposed of before that time.

The master has held that Mr. Bagge is not subject to any liability or to be considered as a contributory in respect of the 260 shares sold back to the company in September, 1840.

In support of the motion made by the official manager to discharge the master's order, it is alleged that the sale of the 260 shares to the company was altogether void, because it was not conducted in the manner pointed out by the 25th clause of the deed of settlement, and that consequently Mr. Bagge ought now and after the lapse of ten years to be considered as the owner of the same shares.

It is true that the purchase by the company was not made according

In re The Northern Coal Mining Company; ex parte Bagge.

to the specific directions contained in the deed; neither could it have been so at that time, for at that time there was no share register book, the shares had no proper number. There had not been any certificate delivered to any proprietor stating the number of shares held by him and the specific number of every such share.

Now, I am of opinion that the scrip certificates were not the certificates meant by the 12th clause of the deed of settlement, and then the question became whether the transaction, such as it was, was not valid - whether the scripholders could not assign or alienate their scrip share by delivery of the certificates or otherwise even to the directors or to the company itself. The company, now making this claim against a person alleged to be a shareholder, ought to be able to show that their business was so conducted that individual shareholders dealing with them could act in the manner directed by the deed. Having neglected to keep a share register book, not having delivered out any certificate of the shares held by the shareholders as directed by the deed, having afterwards dealt with a holder of scrip as a shareholder for the purpose of purchasing his shares, having bought the shares mentioned or referred to in the scrip certificates, and having afterwards treated the same person as having ceased to be a proprietor, I think that they are not entitled to treat the transaction as void, merely because there had not been an observance of those forms which their own irregularity and neglect had made it impossible to observe. I am far from thinking that forms were in themselves immaterial: I presume they were meant, and they were, to some extent at least, calculated to protect the company against fraudulent and collusive purchases from shareholders. But I think that the regulations had reference to a state of things which, in consequence of the neglect of the directors, did not exist; and after the decisions which have been made on the subject of scrip shares, I cannot consider these scrip shares as inalienable even to the company itself in any ordinary mode of transfer.

I am, therefore, of opinion that the motion must be refused, with costs, which must be paid out of the estate.

Mr. Roundell Palmer. The subject of costs was before Lord Cottenham, who said, that, by an omission of the legislature, the court was so situated, that, however justice might require that costs should be paid at all events, yet the act of Parliament disabled the court from giving them, except out of the estate.

Ashton v. Langdale.


May 2, 1851.

[ocr errors]

Statute of Mortmain, 9 Geo. 2, c. 36 Shares in incorporated and unincorporated Companies - Railway Mortgages and Debentures— Railway Scrip- Practice - Exceptions to Report.

Shares in incorporated companies having interests in land, as canal companies, railway companies, &c., constituted by acts of Parliament, under which the shares are declared to be personal estate, are not within the Mortmain Act, 9 Geo. 2, c. 36.

Debentures given by incorporated companies having interests in land, which merely contain a personal obligation, and do not convey the undertaking, tolls, &&, to the holder, are not within the Mortmain Act.

Shares in an unincorporated banking company, which was authorized to hold lands by way of mortgage, and might have had interests in lands, and which had been constituted by deed of settlement, under which the shares were declared to be personal estate, held not to be within the Mortmain Act.

Railway scrip is not within the Mortmain Act.

Mortgages given by a railway company of the undertaking and tolls, rates, and sums arising by virtue of the act of Parliament under which it was constituted, held to be within the

Mortmain Act.

Where exceptions to a master's report relate only to matters of law, and not to matters of fact, the court will not make any order on the exceptions, but express its decision by way of declaration.

It was conceded by the parties interested in opposing it, that a bequest to the commissioners for the reduction of the national debt, to be applied in reduction of the national debt, was a charitable use.

JOHN ASHTON, by his will, dated the 15th of November, 1836, after certain bequests therein contained, made the following disposition:

"I give and bequeath all the rest, residue, and remainder of my personal estate and effects, after payment of the several legacies or sums of money hereinbefore given or bequeathed by me, unto the honorable commissioners for the time being of the sinking fund of the United Kingdom of Great Britain and Ireland, to be applied by them, according to the directions and regulations of the laws and statutes in force, for the time being, for regulating and applying that fund in or towards the extinction or reduction of the national debt of the said United Kingdom, or as near thereto as circumstances will permit." The testator died in April, 1846.

The bill was filed by the executor of the testator against his next of kin, and the commissioners for the reduction of the national debt, for the administration of his estate.

It appeared by the master's report that the testator died possessed of the following items of property:

First. Mortgages of turnpike tolls.

Secondly. Twenty shares in the Peak Forest Canal Company, an incorporated company, which had been constituted by the 34 Geo, 3, c. 26, under which it was declared "that the shares should be personal

120 Law J. Rep. (N. s.) Chanc. 234.

Ashton v. Langdale.

estate, and transmissible as such, and should not be of the nature of real property."

Thirdly. Thirty-five shares in the Birmingham Waterworks Company, an incorporated company, which had been constituted by the 7 Geo. 4, c. 109, under which the company were authorized to purchase and hold lands, and under which it was declared "that the shares should be personal estate, and transmissible as such, and should not be of the nature of real property."

Fourthly. A large number of railway shares in different companies, which, by the acts of Parliament under which they were constituted, or the Lands Clauses Consolidation Act, were declared to be "to all intents and purposes personal estate, and transmissible as such, and should not be deemed of the nature of real estate."

Fifthly. Several railway debentures, one of which was of the following form: "The Sheffield, Ashton under Lyne and Manchester Railway Company promise to pay the bearer hereof at Messrs. Glyn & Co.'s, Lombard Street, 5000l., value received; and that, until the same shall be paid, interest at 417. per cent. shall be paid half yearly; as witness the corporation seal of the company." (The others being of the same form.)

Sixthly. 150 shares in the Manchester and Liverpool District Banking Company, constituted by a deed of settlement, under which the shares were declared to be personal estate, and under which the directors were authorized to invest money on the mortgage of real


Seventhly. Several railway mortgages, of which the following is one, (the others being of a similar form:) "The Manchester and Birmingham Railway Company assign unto John Ashton, his executors, administrators, and assigns, the said undertaking, and all and singular the rates, tolls, and sums of money arising by virtue of the said act, and all the estate, right, title, and interest of the said company, to hold the same until the sum of 30,000l. shall be repaid with interest at 417. per cent."

Eighthly. A large quantity of railway scrip.

It was admitted by all the defendants that the statements in the master's report were correct; but, the form of report being objected to by both sets of defendants as to the master's representations of the different items being, or not being, interests in land, exceptions were taken to it.

The exceptions now came on to be heard.

Mr. Roundell Palmer and Mr. Hobhouse, for the exceptions, having stated the case,

KNIGHT BRUCE, V. C., asked if the facts in the report were admitted. On this being assented to,

KNIGHT BRUCE, V. C., said that where exceptions related to only matters of law, and not to matters of fact, they merged, if he might

Ashton v. Langdale.

use the expression, in the further directions. He should make no order on the exceptions, and his decision on the questions submitted to him would be only by way of declaration.

Mr. Roundell Palmer said he understood that it was intended, on the part of the commissioners, to raise the question whether the residuary bequest was "a charitable use."

The Solicitor General, for the commissioners, said, that it had been at one time intended to raise that question; but, after a due consideration of the point, and having regard to Nightingale v. Goulbourn, 5 Hare, 484; s. c. 16 Law J. Rep. (N. s.) Chanc. 270; 2 Phil. 594; 17 Law J. Rep. (N. s.) Chanc. 296, he had come to the conclusion to give it up. He also admitted that the turnpike tolls were within the act.

Mr. Roundell Palmer and Mr. Hobhouse. The canal shares, waterworks shares, and railway shares, (being the shares in incorporated companies,) are within the provisions of the Mortmain Act, 9 Geo. 2. c. 36; the profit being derived from land, and from tolls arising from the use of land. There is certainly a conflict of authorities- Sparling v. Parker, 9 Beav. 450; s. c. 16 Law J. Rep. (N. s.) Chanc. 57, and Walker v. Milne, 11 Beav. 507; s. c. 18 Law J. Rep. (N. s.) Chanc. 288, decided by Lord Langdale, and Hilton v. Giraud, 1 De Gex & Sm. 183; s. c. 16 Law J. Rep. (N. s.) Chanc. 285, and Thompson v. Thompson, 1 Coll. 381; s. c. 13 Law J. Rep. (N. s.) Chanc. 455, decided by this court, are against the next of kin; but the cases of Howse v. Chapman, 4 Ves. 542, Tomlinson v. Tomlinson, 9 Beav. 459, and Myers v. Perigal, 16 Sim. 533; s. c. 18 Law J. Rep. (N. s.) Chanc. 185,' are in their favor. It is to be remarked that Tomlinson v. Tomlinson, though not reported until after Sparling v. Parker, had preceded it by many years and that this court has followed the decisions of Lord Langdale. The debentures are also within the act, as giving the holders a right to a receiver. Russell v. The East Anglian Railway Company, 3 Mac. & Gor. 104; 1 English Reports, 101; and see post. The shares in the banking company, an unincorporated company, are also within the statute. Myers v. Perigal. The railway mortgages also are within the statute. Finch v. Squire, 10 Ves. 41. [On this point, Doe d. Myatt v. The St. Helen's and Runcorn Gap Railway Company, 2 Q. B. Rep. 364; s. c. 11 Law J. Rep. (N. s.) Q. B. 6, was also referred to.] Lastly, the railway scrip is also within the act.

Mr. Russell, Mr. Edward Bury, Mr. Calvert, and Mr. Baggallay, on the same side.

The Solicitor General and Mr. W. M. James, for the commissioners, were not called upon.

KNIGHT BRUCE, V. C. I do not understand that any case has been

1 This case has been heard, on appeal, by the lord chancellor, and awaits his decision.

« EelmineJätka »