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Such books, even though kept in strict compliance with the act, cannot in general be evidence for the company further than is provided by their act. (s)

342. The act usually provides for the shareholders having access to the books of the company under certain limitations. A shareholder who neglects to avail himself of this privilege cannot, when sued by the company for calls, compel an inspection of the company's books, at least, where his object is not to enable himself to plead a particular plea, but to discover some ground of defence to the action. (t)

SECT. 4. Of the Capital of the Company.

Sub-Sect. I. Of the Capital of the Company in general.
II. Of shares.

III.-Of Calls.

SUB-SECT. 1.-Of the Capital of the Company in


343. A railway act invariably empowers the company to raise a certain amount of capital by the

(s) See Hill v. Manchester and Salford Water Works Company, 5 B. & Ad. 866; Clarke v. Imperial Gas Company, 4 B. & Ad. 315.

(t) Birmingham, Bristol and Thames Junction Railway Company v. White, 2 Railw. Cas. 863; S. C. 1 A. & E. N. S. 282. As to right of inspection of books of company, and mode of enforcing such right, &c. see Rer v. Wiltshire Canal Company, 5 N. & M. 344, S. C. 3 A. & E. 477; Rex v. Trustees of NorthLeach and Witney Roads, 5 B. & Ad. 978; Pontet v. Basingstoke Canal Company, 2 Bing. N. C. 370; S. C. 2 Scott, 543; Imperial Gas Light Company v. Clarke, 7 Bing. 95; Rex v. Masters and Wardens of Merchant Tailors' Company, 2 B. & Ad. 115; Mayor of Southampton v. Graves, 8 T. R. 590.

mutual subscriptions of its members. This capital it divides into shares, which are made to vest in the subscribers according to their respective contributions, and entitle them to a corresponding proportionate part of the profits of the undertaking. Such shares are transferable by the proprietor, and in case of his death, bankruptcy, &c., pass to his legal representative. A party accordingly can in general no otherwise become a member of such a company than by himself subscribing to the undertaking, or stepping into the place of an original subscriber; and it is the peculiarity of what is thus made the title of admission to the company, and the provision it affords for the succession of fresh members, that constitutes one of the main features of these companies, and mainly distinguishes them from ordinary corporations.

344. A railway act in general gives a power to the company, not merely to raise a certain fund out of the subscriptions of its members, but likewise to insist on the payment of those subscriptions. The exercise of this power however is subjected to certain stringent restrictions in favour of the subscribers. In the first place, a party is not to be called on to pay the entire amount of his subscription at once and in one entire sum, but only by certain instalments and at certain intervals, as the exigencies of the society may require. The company furthermore are required, whenever they call for any instalment, to give notice thereof to the subscribers, and this in a particular way, and with particular formalities prescribed by the act. And it is only where these various requisites are fully satisfied,

that the company can avail themselves of the remedies given by the act for compelling payment from the subscribers.



SUB-SECT. 2.-Of Shares.

Of their Nature.

Of their Incidents, and herein,

1st, Of their Capability of Transfer;
2dly, Of their Liability to Forfeiture.

345. I. AS TO THE NATURE OF A SHARE. (a) It may be defined to be a right to partake, according to the amount of the party's subscription, of the surplus profits obtained from the use and disposal of the capital stock of the company to those purposes for which the company is constituted. In general, the act expressly provides that this interest shall be deemed personal property. Independently however of any such enactment, it must, it seems, be so regarded; and this, notwithstanding it arises in a measure out of realty, it being the surplus profit only that is divisible among the individual shareholders, and the railway, land, buildings, &c., being the mere instruments whereby the joint stock of the company is made to produce that profit, and belonging moreover exclusively to the corporate body, which is altogether a separate person from its individual members. (b)


(a) As to nature of shares under Companies Clauses Consolidation Act (8 Vict. c. 16), see act, s. 7, post, App.

(b) Bradley v. Holdsworth, 3 M. & W. 422; see also Bligh v. Brent, 2 Y. & Coll. 294, and cases there cited.

DENTS usually annexed to shares in a railway company by the legislature; and herein, 1st, of their CAPABILITY OF ASSIGNMENT. Railway shares are transferable, &c. (c) in three ways; I. By the act of the owner; II. By the act of the law; III. By the act of God. The first class of transfers is again distinguishable according to the quality or quantity of interest that passes to the transferee, viz. into assignments, leases and pledges, equitable mortgages and the like.

347. 1st, then, of absolute assignments, and herein, 1st, of the power of assignment generally; 2dly, of the contract of sale; 3rdly, of the conveyance. 1st. Under the usual provisions of a railway act, shares are transferable at the sole will and pleasure of the holder, subject only to this one restriction, viz. that shares are not to be transferred after a call has been made, &c. in respect thereof, unless such call has been paid. (d) The provisions of railway acts touching registration, not being intended to affect the property (e) in the shares, a transfer is valid, though made by an unregistered proprietor prior to the formation of a register of the proprietors. (f).

348. 2dly. Of the contract of sale; and here four points suggest themselves for consideration, the title

(c) As to transfer of shares under Companies Clauses Consolidation Act (8 Vict. c. 16), see act, s. 14, et seq. App.

(d) Under Companies Clauses Consolidation Act, s. 16, transfer not to be made until calls paid. See App.

(e) See London and Brighton Railway Company v. Fairclough, 2 Railw. Cas. 544; S. C. 2 M. & Gr. 674.

(f) Sheffield, Ashton under Lyne and Manchester Railway Company v. Woodcock, 2 Railw. Cas. 522; S. C. 7 M. & W.

and capacity of the vendor, the contract, the rights, duties, and liabilities to which it gives rise, and the remedies incidental to those rights. First, then, of the title and capacity of the intended vendor. A party may enter into a contract for the sale of shares in a railway company, although at the time of the contract he is not possessed of them, nor has entered into any contract to purchase them, nor has any reasonable expectation of becoming possessed of them by the time appointed for the delivery of such shares, otherwise than by purchasing them after the making of the contract, the stock-jobbing act not applying to bargains for the stock of a railway company, but only for public stock; (g) but where the other party bargains for a conveyance from the vendor himself, there the latter, it should seem, must take care to acquire a property in the shares by the time appointed for the transfer, so as to be capable of conveying himself, because under such circumstances the intended transferee must be understood as bargaining for the security of the other's implied covenant for title, which he cannot have, if a different person is owner, and is to convey to him. (h) As a general rule, a vendor ought also to take care to pay all calls due before the time fixed for the transfer, as a railway act usually provides that no shares in the

(g) Hewitt v. Price, 4 M. & Gr. 355; Hibblewhite v. M'Morine, 5 M. & W. 462. But it is otherwise, as it seems, by the French law; and therefore a contract made in France for the sale of shares in a foreign undertaking cannot, under such circumstances, be enforced in this country; Hannuic v. Goldner, 11 M. & W. 849.

(h) Hibblewhite v. M'Morine, 2 Railw. Cas. 66; S. C. 6 M. & W. 200.

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