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

I.

II.

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)

346. II. OF THE VARIOUS PROPERTIES OR INCI

(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 reasonable any 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.

undertaking shall be sold after any call has become payable in respect of such shares unless the full amount of that call has been paid. (i) This provision however the purchaser may waive by any agreement or stipulation to that effect, even though it be by parol only, shares in a railway company being neither an interest in land nor goods and merchandize, and therefore contracts regarding them not falling within the operation of the statute of frauds. (k)

349. Secondly. Of the contract; and herein, 1st, of its requisites; 2nd, of its form; 3rd, of the rules of construction by which it is governed. The requisites of a contract for the sale of railway shares must necessarily be the same as those of an ordinary con

(i) See ante, 256, n. (h).

(k) Ibid.; see also Humble v. Mitchell, 11 A. & E. 205; S. C. 2 Railw. Cas. 70; Bradley v. Holdsworth, 3 M. & W. 422; Duncuft v. Albrecht, 12 Sim. 189. See also Hargreaves v. Parsons, 13 M. & W. 561; there the defendant and one P. agreed for the sale by P. to the defendant of the “put or call" of fifty foreign railway shares at a certain price per share premium, at any time on or before the 18th February, 1844. Before that day the defendant agreed to resell the option to the plaintiff and to guarantee the performance of the agreement by P. On the 16th February, the plaintiff called the shares (i. e. required the delivery of them pursuant to the agreement), but it was at the same time verbally agreed between him and the defendant and P. that they should be delivered by P. to the plaintiff, not on the 18th of February, but on the 2d of March at Paris. It was held that this was not an agreement by the defendant to be answerable for the default of P., but an original promise by the defendant for the delivery of the shares by P., for which a note in writing was not required by the statute of frauds, that statute applying only to promises made to persons to whom another was already or was to become answerable, and P.never having contracted, &c. with the plaintiff.

tract of sale, viz. the mutual assent of the parties and an agreed price.

350. (2ndly.) Of the form. A contract for the sale of railway shares need not be in writing, inasmuch as railway shares, as has before been said, are neither an interest in land, nor goods, wares, or merchandize, (k) and therefore contracts regarding them do not fall within the operation of the statute of frauds.

351. (3rdly.) The class of contracts in question must, it seems, be taken to be governed by the like rules of construction as mercantile contracts in general, of which they form a class. Evidence, for instance, of a prevailing usage, may be called in to alter, qualify or explain the terms of such a contract. Where, therefore, parties bargain for the sale of shares, to be transferred on or before a given day, although on the face of the contract the option of the time would seem to be with the seller, being the party to perform the first act, evidence would, nevertheless, it should seem, be admissible to show that, according to the usage prevailing in such contracts, the option was with the purchaser. (1) So likewise in an action for not accepting (m) railway shares sold at Liverpool, and to be delivered in a reasonable time, a rule of the Liverpool Stock Exchange, acted on by all the Liverpool brokers, and seen by the defendant, "that the seller was in all cases entitled to seven days to complete his contract by delivery, the time to be computed from the day

(k) See ante, 257, n. (k).

(1) Hare v. Waring, 3 M. & W. 376.

(m) Stewart v. Cauty, 2 Railw. Cas. 616; S. C. 8 M. & W.

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