Aug. 11. The following judgments were read : C. A. 1903 VAUGHAN WILLIAMS L.J. This is an appeal from the judgment of Lord Alverstone C.J. in an action tried by him without SHEFFIELD CORPORATION a jury. The facts will be found sufficiently set forth in the judgment of the Lord Chief Justice. [The learned judge gave a summary of the facts, and continued:-] The Sheffield Corporation, in the present action, claim that the defendants are liable to repay them the moneys so paid as aforesaid, and to indemnify the plaintiff corporation in respect of the said liabilities. The plaintiffs shape their case in this way. They say that they have done a lawful act at the request of the defendants, which lawful act had caused the plaintiffs damage, and that, therefore, the defendants were liable for the damage so caused to the plaintiffs. They also say that the question whether a contract of indemnity ought to be implied is in each case a question of fact; and that the implication ought to be made in this case by reason of the defendants having sent in to the plaintiffs the forged transfer at the time when they requested, or, to use the word of the special Act, demanded registration and a certificate. Before dealing more particularly with the terms of the Sheffield Act and the authorities bearing on the circumstances justifying an implication of a contract of indemnity, I wish to say at once that I regard what the defendants did and the act of the corporation thereupon as being aptly described by the words of Bramwell B. in Hart v. Frontino, &c., Gold Mining Co. (1): "I made you a tender of myself as a shareholder, and you accepted me, and I have acted upon that acceptance." And I do not think that the defendants in sending in a transfer to the corporation gave any warranty to the corporation, or made any material representation to the company, that the transferor was the registered holder of the stock: see the judgment of Lord Field in Balkis Consolidated Co. v. Tomkinson (2), where he says that a purchaser sending in a transfer to the corporation makes no representation which might estop him. as against the corporation. See also an observation of v. BARCLAY. (1) L. R. 5 Ex. at p. 115. (2) [1893] A. C. at p. 413. C. A. 1903 SHEFFIELD CORPORATION v. BARCLAY. Vaughan Williams L.J. Brett L.J. to the same effect in Simm v. Anglo-American I will now deal with the authorities. It seems to me perfectly clear that a distinction must be drawn between cases where a request is made to some one who has no duty in the matter independently of the request, and cases where the request is made to one who has a duty in the matter independently of the request. In the former case, where that which is requested to be done does not appear to be illegal, and an act is done in accordance with the request, the implication of a contract of indemnity by the person making the request will generally be made. In the latter case something more than a mere request will be required to raise the contract of indemnity. This distinction is apparent by a comparison of the cases of indemnity claimed by sheriffs with cases where an indemnity is claimed by those who have no duty in the matter. The fact is that in the former class of cases the request or instruction is the sole cause of the act. In the latter the performance of the duty is, or may be, the dominant cause. Collins v. Evans (2) is a case in the Exchequer Chamber, in which the defendants, having reason to believe and actually believing a fact to be true and representing it as such to the sheriffs, who had a duty in the matter, were held not to be liable to an action, although it turned out in the event that they were mistaken; and Tindal C.J. distinguished that case from Humphrys v. Pratt (3), on the ground that in that case the plaintiff pointed out the goods and required the sheriff to take them. Childers v. Wooler (4) is a case on the same lines, in which the defendant Wooler, as attorney for the plaintiff in that suit, caused a writ of fi. fa. to be issued upon the judgment, and the usual indorsement of the amount to be levied was followed continuously by these words: "The defendant is a" (here there was a blank), "and resides at Redcar, in your bailiwick"; and the Court of Exchequer Chamber held that the indorsement was nothing more than a mere statement by the attorney for the purpose (1) 5 Q. B. D. 188, at p. 210. (3) (1831) 5 Bli. (N.S.) 154; 35 R. R. 41. (4) 2 E. & E. 287. C. A. 1903 v. BARCLAY, Vaughan Williams L.J. of affording information to the sheriff, leaving the sheriff to his own discretion as to how he would act. On the other line of cases one finds as examples Toplis v. Grane (1), in which the SHEFFIELD defendants authorized the plaintiffs as brokers to distrain, and CORPORATION the plaintiffs, after asking for an indemnity, proceeded to distrain and took some privileged goods in bona fide compliance with the defendants' directions, without, however, having obtained an indemnity, and the defendants were held liable. And, again, in Betts v. Gibbins (2) goods were deposited by the defendant with the plaintiffs for N., who took two casks away, and the defendant ordered the plaintiffs not to deliver the residue of the goods, which order the plaintiffs obeyed. The plaintiffs being sued and having paid a sum of money and costs to compromise the action, it was held in an action by the plaintiffs against the defendant that a promise to indemnify to the full amount claimed might be implied from the facts. These were cases in which there was no relation of principal and agent, and the mere request or instruction by the defendant to the plaintiff to withhold the goods from N., obeyed by the plaintiff, was held to be sufficient evidence to raise a contract of indemnity. Where the relation of principal and agent exists it is a fortiori that a contract of indemnity may arise on the facts. These cases illustrate the distinction which I have drawn. I will now deal with the special provisions of the Sheffield Act, although I do not think that they differ materially from the provisions to be found in the Companies Act, 1862. The most material provisions seem to me to be s. 25, sub-s. 1, which requires the corporation to keep books in which shall be entered the names and addresses of the holders from time to time of corporation stock; and, sub-s. 2, that the corporation stock register shall be primâ facie evidence of the title of the persons entered therein as holders of stock. Sect. 26, sub-s. 1, which provides that, on demand of a holder of corporation stock, the corporation may if they think fit give him a certificate of the proprietorship thereof; sub-s. 2, that a stock certificate shall be primâ facie evidence of the title of the (1) 5 Bing. N. C. 636; 50 R. R. 814. (2) 2 A. & E. 57; 41 R. R. 381. C. A. 1903 v. Vaughan Williams L.J. person therein named. Sect. 29, sub-s. 1: That where stock is transferable by deed (which is this case)-sub-s. 4-the deed of SHEFFIELD transfer when duly executed shall be delivered to and kept by CORPORATION the corporation or the registrar, and the corporation or the BARCLAY. registrar shall enter a memorial thereof in the register of transfers; sub-s. 5, the corporation or the registrar shall on demand and on delivery up of the old stock certificate, or on proof satisfactory to the corporation of its absence, deliver a new stock certificate to the purchaser; sub-s. 6, until the deed of transfer has been so delivered the corporation shall not be affected thereby, and the purchaser of stock shall not be entitled to receive any dividend thereon. Sect. 30, sub-s. 1: The corporation or the registrar, before allowing any transfer of stock, may, if the circumstances of the case appear to make it expedient, require evidence of the title of any person claiming a right to make the transfer. It seems to me that in this case those who sent the old certificate to the corporationthat is to say, those who claim to be vendors-claim a right to make the transfer, and in my judgment all that Barclays did was to tender the transfer for acceptance, and the corporation accepted the transfer. The case, as pointed out by Bramwell B. in Hart v. Frontino, &c., Gold Mining Co. (1), is analogous to that of a bonâ fide holder of a bill of exchange presenting it for payment to a banker-if the banker pays it he cannot afterwards recover the money from the holder on the ground that the name of the drawer was forged. Lindley J. took the same view in Simm v. Anglo-American Telegraph Co. (2) In my judgment the provisions of the special Act bring this case within the observations of Blackburn J. in In re Bahia and San Francisco Ry. Co. (3), approved by Lord Herschell in Balkis Consolidated Co. v. Tomkinson. (4) Those observations of Blackburn J. run thus: That when joint stock companies were established the great object was that the shares should be capable of being easily transferred; that the Legislature had accordingly provided for the keeping of a register of the members, in order to keep which the (1) L. R. 5 Ex. 111, at p. 115. (3) L. R. 3 Q. B. 584, at F. 595. (4) [1893] A. C. 403. C. A 1903 CORPORATION v. BARCLAY. Vaughan Williams L.J. company must alter the register whenever there was a transfer of its shares; and the learned judge drew attention to s. 31 of the Companies Act, 1862, which provides that a company may SHEFFIELD give certificates, and that these shall be primâ facie evidence of the title of the person named to the shares specified, and pointed out that by granting the certificate the company make a statement that they have transferred the shares specified to the person named in it and that he is the holder of the shares; that if the company have been deceived and the statement is not true, they may not be guilty of negligence, but they and no one else had power to inquire into the matter. The learned judge expressed the opinion that it was the intention of the Legislature that these certificates should be documents on which buyers might safely act, and continued thus (1): "It is quite clear that a statement of a fact was made by the company, on which the company at the very least knew that persons wanting to purchase shares might act. And the claimants having bonâ fide acted upon that statement, and suffered damage, can they recover from the company? think they can on the principle enunciated in Freeman v. Cooke." (2) And Lord Herschell points out (3) that it makes no difference whether it is the purchasers who are seeking to render the company liable by way of estoppel or the vendor of the shares who himself received the certificate from the company, because it must equally have been within the contemplation of the company that a person receiving the certificate from them might on the faith of it enter into a contract to sell the shares. It seems to me to be the fact in the present case. I I bave only now to deal with the cases directly bearing on the position and rights relatively of the person who tenders a transfer for acceptance and the company who accept it. It was not really contested in argument before us that the corporation had some duties towards the person tendering the transfer. It was admitted that it was their duty to look at their register; and it was admitted that, in some cases at (1) L. R. 3 Q. B. at p. 596. (2) (1848) 2 Ex. 654. (3) [1893] A. C. at p. 405. |