The Legal
Legal Observer,

AND

SOLICITORS' JOURNAL.

SATURDAY, JUNE 21, 1856.

THE JOINT-STOCK LIMITED LIA- of Commons affirmed that the Law of PartBILITY BILL. nership required alteration, and that the principle of limited liability ought to be

THE Joint-Stock Companies Bill, which adopted. Parliament, indeed, has no right passed the House of Commons after much to interfere with the free application of opposition, was read a second time in the capital; nor to subject men to an unliHouse of Lords on Monday last the 16th mited extent of liability which they never instant, and is now in Committee of the intended. It is, no doubt, just and fair whole House. It was opposed by Lord that the amount to which the partners or Overstone, amongst other grounds, because shareholders in any company intend to peril it excluded Banking and Insurance Com- their private property should be stated and panies and all other Companies of less than registered, so that all who deal with the seven in number, from the privilege of company may know the amount for which limited liablity. We understood that these each partner is responsible. exceptions to the operation of the Bill were The Act in truth will remove impedimade for the purpose of meeting some of ments in the progress of trade and comthe objections raised by the opponents of merce. All companies numbering more the measure; but there is no hope of than 20 shareholders will be brought under satisfying men who contend against the the provisions of the Act, and where they whole principle of the Bill, and assert that are between 7 and 20 in number they will it will favour every description of fraud and be permitted to avail themselves of its proimperil the commercial security of the visions upon setting forth the objects of the country! company, the number of shares, and its We have not heard that the Limited limited constitution. A registry will be esLiability Act of last year, though imperfect tablished, accessible to the public, and in its scope and some of its details, has ample provisions are made for winding up been productive of any of the evils which the company. The terms and conditions were so confidently predicted, and which of the partnership being made public, what are again repeated with reference to the ground of complaint can there be if the enimproved measure now before the House. terprize be unsuccessful? These prognostications of fraud and ruin, which have not been realised, come now with weakened effect, and the House decided by a majority of nearly four to one in favour of the Bill. The question of limited liability has been under the discussion of Parliament for several years, and we have the example of various parts of the Continent (where the principle has been long established) of its safety and sound commercial policy.

Three years ago a resolution of the House

After further experience, those excepted companies might be brought within the provisions of the Act. No. 1,476.

VOL. LII.

It has been urged, however, that the measure will promote undue and dangerous speculation. Admitting that speculation will be increased, that additional capital will be invested, and enterprizes engaged in which are impeded by the present state of the Law, we deny that the speculations will be more dangerous than they are without the rule of limited liability. The extent of the risk will be known. A man may embark 1,000l., but not his whole property. If unfortunate, he is not a bankrupt; he pays: up his stipulated capital and there is an end to his responsibility. The Legislature cannot distinguish between safe and dangerous speculations. The merchant, manufacturer,

I

138

The Joint-Stock Limited Liability Bili.—New Statutes.

and trader must be left free to conduct his more right to complain if the debtor be unenterprizes on his own responsibility, guid- able to pay for the goods sold to him, than ed by his own skill and his own experience. the lender of money with which the busiThe proposition which has so often been ness is carried on. The creditor for goods put forward, with a sort of boastful feeling sold, does not give credit on the faith that of honesty, that a man who shares in the the capitalist who receives interest in proprofits of business must bear its losses, is portion to the profits will be liable. He for the most part fallacious. He does not knows nothing of him, and delivers the share unlimitedly in the profits; he shares merchandize on the sole responsibility of only in the proportion of his capital in- the trader. If he is not satisfied with such vested; and should therefore be liable only responsibility, he may require a guarantee; to his fair proportion of the loss. If the but without such guarantee, he has no right project be prosperous, he receives 10 or 20 to call upon a third party who was entirely per cent. on his capital. If disaster attends unknown to him at the time of the contract, the speculation, he loses his capital. True but who, instead of stipulating or lending it is, that it must be known to all who deal his money for an absolute 20 per cent. inwith him that he intends to risk only a terest, is satisfied with conditional interest given amount of capital, either actually paid at 10 per cent. on the profits. up and invested in the stock of the concern, or forthcoming whenever called for, and this information the Bill provides shall be truly given.

NEW STATUTES EFFECTING AL-
TERATIONS IN THE LAW.

FIRE INSURANCES.

19 VICT. C. 22.

Duties to be chargeable on all insurances of property within the United Kingdom wheresoever made; sect. 1.

Persons insured chargeable with duties where insurances made by unlicenced foreign companies; s. 2.

Let it be recollected also, that in most of these limited liability cases, the creditors are really benefited by the liability to which each partner is subject, and it is more for their interest that these limited amounts are made available, than by the present system, under which a monied man may make advances at any rate of interest,taking a security for repayment which may be enforced in priority of other creditors or at all events, in case of bankruptcy, he is entitled to a dividend along with the other creditors,—whereas if a partner, how-persons keeping an office for insuring property from loss by fire. Such persons reever limited his share, he must wait till all quired to take out licence and give security the creditors are paid in full, before he can for payment of the duties. Penalty for nereceive anything, and it is only in the event glect; s. 3. of a surplus that he takes a share according to the amount of his capital.

The main object to be effected, under the provisions of the Joint-Stock Companies Bill, is that all limited companies be registered, the names of the partners or shareholders known, and the extent of liability of each duly recorded. It seems to us that this object will be effected under the Bill now before the House of Lords, and we trust that no material alteration will be made in its provisions.

The other Bill on the general Law of Partnership, applicable to companies where the members of them are less than seven, seems also to deserve the support of the Profession. According to the provisions of that Bill loans may be effected, with interest paid out of and in proportion to the profits, without subjecting the lender to the liability of a partnership; and here also it may be observed, that the creditor has no

All persons who shall as agents receive proposals, &c. for insurances by companies out of the United Kingdom deemed to be

Persons keeping offices for insurances on behalf of foreign companies to be chargeable with the duties on such insurances; s. 4.

Not to limit charge of duty under former Acts, nor to charge insurances exempted;

thereof, and a certain stamp duty is by law | such insurance as aforesaid for or on behalf of chargeable upon any policy or other instrument any such company, society, or person or perwhereby any insurance is made of or upon property from loss or damage by fire, and a further duty at and after the rate of 3s. per cent. per annum, is also chargeable in respect of every such insurance; And whereas a practice has been established of insuring from loss by fire property situate within the United Kingdom by foreign companies or by policies or insurances made abroad, and it is expedient that all such insurances should be subject to the same duties as the like insurances made by companies within the United Kingdom are now by law chargeable with: Be it therefore enacted as follows:

1. The said respective duties by the said Acts granted as aforesaid shall extend to and be payable and paid for and in respect of every insurance of property situate within the United Kingdom from loss or damage by fire, whether the same shall be made by any company, society, or person or persons within or out of the United Kingdom, and whether the policy or other instrument, note, or memorandum of or relating to any such insurance shall be made, signed, or issued in the United Kingdom or elsewhere, and whether there shall be any such policy, instrument, note, or memorandum, or

not.

sons as aforesaid, or who shall issue or deliver out any policy or other instrument or any note or memorandum of or relating to any such insurance as aforesaid, made or proposed or intended, shall be held and deemed to be a person keeping an office for insuring property from loss by fire within the meaning of the several Acts before-mentioned, and shall be and is hereby required to take out a proper licence in that behalf, and to give security in the manner directed by the said Acts respectively, and in such form as the Commissioners of Inland Revenue shall think proper, for accounting for and paying the duties with which he shall be chargeable as hereinafter-mentioned; and if any such person hereby required to take out such licence and to give such security as aforesaid shall neglect or omit so to do, he shall forfeit the sum of 1007., and the like penalty for every day that such neglect or omission shall continue.

4. Every person who by reason of any such Act or means as in the preceding clause mentioned shall be deemed to be a person keeping such office as aforesaid within the meaning of this Act and the several Acts aforesaid shall account for and shall be chargeable with the duties in respect of all such insurances as aforesaid made or undertaken or agreed to by any company, society, or person or persons out of the United Kingdom for whom or on whose behalf or in respect of whose business of insurance he shall do any such act as aforesaid, or become a person keeping such office as aforesaid.

2. Where any such insurance as aforesaid shall be made by any company, society, or person or persons out of the United Kingdom, the person insured shall be chargeable with the duties payable in respect of such insurance, and shall pay the same to some agent of such company, society, or person or persons who shall be duly licensed as hereinafter-mentioned, 5. Provided always, That nothing herein or, if there be no such agent, then to the Re- contained shall extend to limit or restrict the ceiver-General of Inland Revenue, or some charging of the said duties under any former other officer appointed by the Commissioners Act now in force, or to charge with duty any of Inland Revenue to receive the same, setting insurance expressly exempted by any such forth the particulars of such insurance in such former Acts. form as the said Commissioners shall require, and in default of such payment the said duties shall be a debt due from him to her Majesty, her heirs and successors, and be recoverable in the manner provided by the 8th section of the Act passed in the 14 Vict. c. 97, or by any other mode by which any such debt may be recovered.

3. Every person in the United Kingdom who shall as agent receive or accept any proposal or instructions for the insurance of property from loss or damage by fire by any company, society, or person or persons out of the United Kingdom, or who shall keep or have or conduct or manage any office or place for accepting or receiving or issuing any such proposals or instructions, or who shall be held out by any public advertisement or notice, with his consent, as a person to or by or from whom any such proposals or instructions may be given or received or obtained, or through or by means of whom any such insurance as aforesaid may be affected, and every person who shall in any manner effect or negotiate or be concerned in effecting or negotiating any

6. And whereas a practice prevails amongst certain insurance companies, on their granting policies of insurance from loss by fire for large Sums, to procure from other companies, in consideration of portions of the premiums for such insurances, indemnity by way of guarantee in case of any such loss happening, against the payment of certain parts of the sums insured, and it is expedient to exempt such indemnity or guarantee from the yearly per-centage duties which would otherwise be chargeable in respect thereof as an insurance from loss by fire: Be it enacted, That where an insurance from loss by fire shall be made by any company who shall duly account for and pay the full and proper duties chargeable in respect thereof, the yearly per-centage duty shall not be payable in respect of any re-insurance effected by such company with any other company by way of indemnity or guarantee against the payment on the original insurance of any portion of the money insured thereby, and no other duty than the stamp duty of 1s. chargeable upon a policy of insurance from loss by fire shall be payable upon such re-insurance.

New Statutes.-Review: Woolrych on the Metropolitan Building Act.

Review: Woolrych on the Metropolitan Building Act.

architect, who, with his clerks, is to be paid by salary; but who must not follow any other occupation.

"The second part of the Act is devoted to the consideration of dangerous, structures. Upon an intimation of danger a survey is to be made under the direction of the Commis

sioners of Sewers or of the Police, to whom notice is in the first instance to be given by the district surveyor. This certificate is the report upon which the Commissioners are to act if it be unfavourable to the structure, and power is given to proceed before a justice to compel repair, and even to sell the property, if the requisitions be not complied with.

"It is very properly ordained, that inmates may be removed from these dangerous buildings by constables, and they shall be received into the workhouse if they have no other place

of abode.

"Party structures embrace the third particular of the Metropolitan Building Statute.

"The rights of the two owners, the building and adjoining owner are separately dealt with The one owner may build, but, unless in case of danger, he must give notice of such his inThe expenses are

tention to the other owner.

141

in setting forth the procedure, in declaring the repeal of Acts upon the same subject, or other collateral matters, and, finally, in directing compensation to the official referees, the registrar, and others whose offices have been abolished."

Numerous alterations are taking place in the law district, as well as all other parts of the metropolis, in the pulling down and rebuilding of houses; and it may therefore be useful to call the attention of our readers to the extent of the precaution necessary in providing hoards and shorings or supports to adjoining buildings. In the notes to the present Act, the Author says:

So if a man build a

who builds a house at the extremity of his "It is not to be supposed that any person land is at once to become so far entitled to a neighbour may not use his own land as he secure foundation there as that his adjoining damage the house. It is his duty to protect pleases, even although he may, in so doing, himself by shoring. If his neighbour digs his land near to the foundation of the new house, so as nevertheless, not to touch the other's to be borne by these owners in proportion, re-into the pit, no action lies. It was the fault of soil, although by such digging the house falls gard being had to the use which each owner the builder to erect his house so near to the makes of the structure. "The fourth part is a miscellaneous collec- stranger's territory (Wilde v. Minsterley, 2 Ro. tion, in the early part of which the persons, house and make cellars upon his own soil, Ab. 564; 15 Car. 1). 'building and adjoining owners,' are more par- whereby a house newly built upon the adjointicularly defined. The expenses above mentioned must be repaid; if not satisfied by the ing soil falls down, no action lies (Stansell v. Jollard, Selw. N. P. 435). The plaintiffs were owner, they will fall, in the first instance, on the occupiers, who may deduct the sums paid owners of a house in Cheapside; the defendfrom the rent due to the landlord. Should ants were owners of the adjoining dwelling. The defendants' house, being in bad repair, there be more than one owner, the rule of conhad, for many years, been supported by strutts tribution must be applied. The owner under sect. 3 is interpreted to mean the person in or shores placed against the house; at length possession or receipt of the rents or profits, or the progress of the work the shores were reit became necessary to rebuild it, and during the occupier other than tenant from year to moved. No supports being substituted by the year, or tenant at will. Hence, a tenant for defendants, the plaintiffs put up some internal more than a year may be classed amongst the owners, and, as all owners are to contribute supports, and it appeared that if the house according to the use which each makes of the would have happened. No notice had been had been properly shored internally no injury structures, the occupying tenant, who has no inconsiderable share of the benefit of party shore up the house, but that was not alleged given by the defendants to the plaintiffs to structures, must have his share of the costs of in the declaration as a ground of injury. Upon repair or improvement. Certainly the occu- these facts Lord Tenterden directed a nonsuit, pier of premises who has paid any expenses being of opinion that the plaintiffs should have under the Act is entitled to deduct his payment sufficiently propped up their own premises. It from the rent by virtue of No. 5 in sect. 9; was then moved to set aside the nonsuit, 1st, but this occupier must mean an occupier from because the defendants were answerable; and year to year, or at will, and not a tenant for 2nd, because they had given no notice. But years. For, immediately afterwards, power is given to an owner to deduct from his landlord's of notice, it was not alleged as the breach, and the Court discharged the rule. As to the point rent any sum beyond his due proportion. therefore the Court would give no opinion There are few expressions which lead to more whether a notice was or not necessary. And confusion than those of owner and occupier. But the Statute may be read with sufficient consistency, if the word owner be referred to owners in the ordinary sense of that word and occupiers for more than a year. Occupier, under the Act, will them mean a tenant at will, or from year to year, or for any less term.

upon the main question, the liability, it was in proof that the defective state of both houses was known to both parties; and there was no evidence to show any grant to the plaintiffs of a right to the support of the adjoining building. No such grant could, consequently, be inferred (Peyton and others v. The Mayor, &c.,

"The residue of these provisions is employed of London, 9 B. & C. 725)."