MONDAY, July 14. TUESDAY, July 15. Long Eaton Recreation Grounds Company, Limited v. Midland Railway Company. Appeal from Lawrance J. Part heard. WEDNESDAY, July 16. New River Company v. Assessment Committee of Hertford Union and THURSDAY, July 17. New River Company v. Assessment Committee of Hertford Union and COURT II. THURSDAY, July 3. IGOE, APP.; SHANN AND OTHERS, RESPS. The decision of the King's Bench Division, reported [1901] 2 K. B. 740, was reversed by the Court of Appeal (Collins M.R. and Mathew L J., Cozens-Hardy L.J. dissenting). Avory, K.C., and Randolph, for the appellant. C. A. Russell, K.C., and Hildesheimer, for the respondents. Sproat v. Marchese. Appeal from Buckley J. Dismissed. FRIDAY, July 11. Ashworth v. English Card Company. Appeal from Joyce J. Allowed. In re Leeds and Hanley Theatres of Varieties, Limited. SATURDAY, July 12. In re Margeston. Margeston v. Margeston. Fleming v. Loe. Mackusick v. Fleming. Fleming v. Loe. MONDAY, July 14. Appeal from Appeal from C. A. HERBERT v. MCQUADE. A. M. July 10. Revenue-Income tax-Public office or employment of profitIncumbent of benefice-Grant from Queen Victoria Clergy Sustentation Fund-Income Tax Acts, 1842 (5 & 6 Vict. c. 35), s. 146; 1853 (16 & 17 Vict. c. 34), s. 2, Sched. E. Appeal from the judgment of a Divisional Court, reported [1901] 2 K. B. 761. Sir R. B. Finlay, A.-G., Sir E. II. Carson, S.-G., and Rowlatt, for the appellant. Danckwerts, K.C., and F. Low, K.C., for the respondent. Appeal from Byrne J. THE COURT (Collins M.R., Stirling and Mathew L.JJ) were of opinion that the grant was not in the nature of a perAppeal from Cozens-sonal gift to the particular incumbent, but was a grant in augmentation of the value of the benefice; they therefore held that the amount of the grant was chargeable with income tax under Sched. E as being profits accruing by reason of the appellant's office or employment, and reversed the decision of the Divisional Court. Mackusick v. Fleming. Appeal from Cozens- TUESDAY, July 15. Attorney-General v. Bournemouth Corporation. Appeal from Swinfen Appeal allowed. Solicitor for the appellant: Solicitor of Inland Revenue. Holm tead v. Cooper. Appeal from Cozens-Hardy J. Part heard. WEDNESDAY, July 16. Holmstead v. Cooper. Appeal from Cozens-Hardy J. Dismissed. Byrne v. Reid. Same v. Same. Appeal from Joyce J. Part heard. ROBINSON GOLD MINING COMPANY v. ALLIANCE INSURANCE Insurance (Marine) -Policy -Property of alien enemy-Loss Appeal from a judgment of Phillimore J., reported [1901] C. A. 2 K. B. 919. Lawson Walton, K.C., and J. A. Hamilton, K.C. (John Dove with them), for the appellants. Lord Robert Cecil, K.C., and Hon. Alfred Lyttelton, K.C. (Loehnis with them), for the respondents. " THE COURT (Collins M.R., Mathew and Cozens-Hardy L.JJ.) Solicitors for the appellants: Ingle, Holmes & Sons. Whatton. July 11. In re LEEDS AND HANLEY Theatres of VARIETIES, LIMITED. Appeal from a decision of Wright J. The Consolidated Exploration and Finance Company was a company whose business was the promotion of other companies. They were the promoters of a company called the Leeds and Hanley Theatres of Varieties, Limited. The Consolidated Company agreed to purchase two music-halls, which were to be sold to the then intended Theatres Company. The agreements entered into provided for the sale of the halls at prices amounting to 24,000l. to one Rands, a man of no substance, who was a trustee for the Consolidated Company; and he agreed to sell July 9, 11. the halls for 75,000l. to one Carter, who was a trustee for the then intended Theatres Company. The real vendors were the Committal -Non-payment of rates—Imprisonment —Receiving Consolidated Company. The directors of the Theatres Comorder-Release Jurisdiction-Legal process-Punitive order-pany were appointed by the Consolidated Company, and two of Distress for Rates Act, 1849 (12 & 13 Vict. c. 14), s. 2-Debtors them received their qualification from that company. Act, 1869 (32 & 33 Vict. c. 62), s. 4, sub-s. 2—Bankruptcy Act, 1883 (46 & 47 Vict. c. 52), s. 10, sub-s. 2. C. A. In re JAMES EDGCOME. Ex parte JAMES EDGCOME. Appeal from a decision of Mr. Registrar Hope. James Edgcome was the occupier of 12, St. James's Square, in the city of Westminster, and was liable to pay 1747. 16s. 44d. under a general rate made on the 12th of April, 1901. He did not pay these rates, and a distress was issued by a police magistrate to levy that sum on his goods. A return of nulla bona was made, and on the 10th of March, 1902, a warrant of commitment in default of distress was issued by the magistrate directing that Edgcome should be imprisoned for one month unless the money were sooner paid. The warrant was directed to be held over for a month, and was eventually executed on the 1st of July, when Edgcome was imprisoned at Holloway. On the 2nd of July he presented a bankruptcy petition, and on the same day a receiving order was made against him on that petition. On the 4th of July he applied to the registrar in bankruptcy for an order that he should be released from prison under sects. 9 and 10 of the Bankruptcy Act, 1883, on the ground that the committal was a legal process against his property or person, and ought to be stayed. The registrar dismissed the application, and the debtor appealed. Haldinstein, for the appellant. The prospectus of the Theatres Company, which was prepared and The Hon. E. C. Macnaghten, K.C., and Kenyon Parker, for the appellants. Younger, K.C., and W. II. Cozens-Hardy, for the liquidator of the Theatres Company. THE COURT (Vaughan Williams, Romer, and Stirling L.JJ.) dismissed the appeal. Muir Mackenzie, for the mayor, &c., of Westminster. THE COURT (Vaughan Williams, Romer, and Stirling L.JJ.) dismissed the appeal. A committal by a magistrate under the Distress for Rates Act, 1849, was of a punitive character, although it determined on payment of the debt. Orders made under sect. 4 of the Debtors Act, 1869, had a similar effect. VAUGHAN WILLIAMS L.J. said that it was clear that the ConThe exceptions there mentioned to the general rule that in solidated Company from the first were acting as the promoters future there should be no imprisonment for debt formed a of the Theatres Company. Their intention was to buy the class of cases standing on the same footing, and were excepted music-halls for the purpose of selling them to a company which because imprisonment under them all meant punishment. That they were to create, viz., the Theatres Company. They stood was the view expressed in Middleton v. Chichester, (1871) L. R. in a fiduciary relation to the Theatres Company, i.e., to the 5 Ch. 152, and In re Smith. Hands v. Andrews, [1893] 2 Ch. 1. persons who were invited to become shareholders in that comTherefore the Bankruptcy Court had no jurisdiction to inter-pany. It was their plain duty to disclose the fact that they fere under sect. 10, sub-sect. 2, of the Bankruptcy Act, 1883. Solicitors: R. G. Davis; Caprons, Hitchins, Brabant & were the beneficial vendors of the property which was sold to the Theatres Company, and that they were making a profit upon privity. It did not disclose their interest, but, on the contrary, of such a notice. ROMER and STIRLING L.JJ. concurred. C. A. FLEMING v. LOE. W. L. C. July 14. Vendor and purchaser— Voidable contract—Assignment of contract -Privity of contract-Money had and received, Action for. Appeal from Cozens-Hardy J., [1901] 2 Ch. 594. A contract of sale was induced by and voidable for misrepresentations made by the vendor. The vendor assigned the benefit of the contract, and payments made as under the contract by the purchaser, before he elected to avoid it, were received by the vendor's assignee. The assignee sued for specific performance, making the vendor and purchaser defendants, and the purchaser counter-claimed, as for money had and received, for repayment of the sums paid by him. The original action was dismissed, and on the counter-claim judgment was given by Cozens-Hardy J., [1901] 2 Ch. 594, for the purchaser against the plaintiff, the assignee, for the sums claimed, with costs, on the ground that they constituted money had and received on a total failure of consideration. The plaintiff appealed. Eve, K.C., and Martelli, for the plaintiff. Upjohn, K.C., and D. D. Robertson, for the defendant, the purchaser. THE COURT (Vaughan Williams, Romer, and Stirling L.JJ.) allowed the appeal and dismissed the counter-claim with costs, holding, upon the facts, that the moneys paid to the plaintiff, the vendor's assignee, had been duly appropriated by him to the purposes for which, under the contract, they were paid and intended by the purchaser, and therefore could not now be recovered from the plaintiff. Solicitors: Morten, Cutler & Co.; Last & Sons. Their Lordships disapproved of the de cision of Kekewich J. to the contrary in In re Dudley and Kingswinford Tramways Company, (1893) 69 L. T. (N.S.) 711. Their Lordships also held that in the present case the defendants had not "substantially commenced" their works within a year from the date of the provisional order. In their opinion, sect. 18 meant an execution of physical works on the tramway line. The making of contracts for the supply of dynamos and cars was not a "substantial commencement" of the works within the meaning of sect. 18. Statutory provisions for the benefit of the public ought to be strictly enforced, even if the enforcement of them would produce hardship to individuals. The injunction claimed by the plaintiffs was accordingly granted. Solicitors: Sydney Morse; Lovell, Son & Pitfield, for J. & W. H. Druitt, Bournemouth. W. L. C. Vendor and purchaser-Specific performance-Sale by trustersRepurchase by one trustee-Executory contract—Purchases" nominee-Breach of trust. By an agreement of the 17th of January, 1902, two trustee for sale, D. and C., contracted to sell a copy hold property to th defendant for 8001., the purchase to be completed on the 281 of February, 1902. The title was investigated and accepted b the defendant, and the conveyance prepared and engrossed The defendant subsequently regretted his purchase, and by s agreement of the 17th of February, 1902, contracted with on of the trustees, D., for the sale to him of this property for 800. and he then wrote and required the conveyance to be made t D., as sub-purchaser, claiming the right to have the su purchaser's name substituted for his own in the conveyance his nominee. D. subsequently declined to allow his name to inserted in the conveyance, alleging that he had entered int the second contract under a mistaken idea of his duties trustee. As the defendant refused to accept a conveyance of t property from the trustees, they brought the present actio against him for specific performance of the contract of the 17 of January, 1902; the only defence to this action was a counte Appeal from the decision of Swinfen Eady J., noted ante, claim by the defendant for specific performance by D. of th p. 126. The plaintiffs appealed. contract of the 17th of February, or damages for the brea thereof. Warmington, K. C., and R. J. Parker, for the plaintiffs. Levett, K.C., and W. A. Jolly, for the plaintiffs. Vernon Smith, K.C., and Charles Church, for the defendants. Norton, K.C., and Hon. M. Macnaghten, for the defendant. THE COURT (Vaughan Williams, Romer, and Stirling L.JJ.) BYRNE J. held that, the contract of the 17th of January be allowed the appeal. They held that, when sect. 18 of the executory, the trustee could not repurchase the property fr Tramways Act, 1870, made a notice purporting to be published his own purchaser; that the defendant was bound to compl by the Board of Trade in the Gazette "conclusive evidence" his contract, and judgment for specific performance must of the non-commencement of works, it was not meant given against him. As to the counter-claim, the defendant w that no other evidence should be admissible in the absence not in a position to enforce specific performance against D., being able to confer upon him a marketable title; nor was he they came within the words of the will which authorized the retainer of the estate or any part thereof "in its present form of investment." No doubt the shares were different shares, but they were substantially the same form of investment. They were always subject to a liability to have preference shares put over them. They came to the trustees because the testator held the shares in the old company, and for no other reason. The only difference was that they were shares in a different company; but that company was only a transformation of the old company. There was no change in the form of the business, no additional liability on the shares, and the trustee was entitled to retain them. Solicitors: Sharpe, Parker, Pritchards, Barham & Lawford, for Benjamin Shirley Smith, Birmingham. H. C. R. Buckley J. July 3, 4. Buckley J. In re JOSEPH SMITH. SMITH V. LEWIS. Trustees-Investment-Breach of trust —Shares in limited company -Reconstruction-Exchange of shares in old company for shares in new company-Retainer of shares-" Present form of invest ment." The testator gave his real and personal estate to trustees upon trust for conversion, and after payment of debts and legacies to invest the proceeds, with power to vary investments. He declared that the trustees might postpone the conversion of his estate for so long as they should think fit, and "retain the same or any part thereof in its present form of investment." By the investment clause he empowered the trustees to purchase (inter alia) preference stock or shares of any joint stock company at the time of investment paying a dividend on its ordinary stock or shares. At the time of his death in 1895 the testator held 750 fully paid ordinary shares of 51. each in the Birmingham Small Arms and Metal Company, Limited, a company which had no preference shares. The trustees found that the shares were of great value, and accordingly retained 520 of them. In 1896 the company, with a view to increasing its capital, passed resolutions for a reconstruction. The company was wound up voluntarily; a new company with the same name was formed; all the assets of the old company were transferred to the new company; and the new company allotted to each member of the old company, in exchange for every share of 51. fully paid in the old company, one ordinary share of 51. and one preference share of 51. in the new company, credited as fully paid. The trustees did not dissent, as provided by Rect. 161 of the Companies Act, 1862, but accepted 520 preference and 520 ordinary shares in the new company. The question in dispute was whether under the will they were authorized to retain the shares in the new company. J. E. Harman, for the surviving trustee. M. Romer, for the tenants for life. R. J. Parker, for the remaindermen. BUCKLEY J. said that when the new company began in 1897 to pay dividends on its ordinary shares the preference shares became an authorized security within the investment clause, and the trustee could retain them. The question whether the July 11. DOUGHTY V. LOMAGUNDA REEFS, Limited. Company-Memorandum of association-Reconstruction-Sale of assets for shares in new company-Voluntary winding-upCompanies Act, 1862 (25 & 26 Vict. c. 89), s. 161. Clause 3 of the memorandum of association of the defendant company stated as some of its objects-"(n) To sell or dispose of the undertaking of the company, or any part thereof, for such consideration as the company may think fit, and in particular for shares, debentures, debenture stock, or securities of any other company having objects altogether or in part similar to those of this company," and "(v) To distribute among the members in specie any property or any proceeds of sale or disposal of any property of the company, and for such purpose to distinguish and separate capital from profits, but so that no distribution amounting to a reduction of capital be made except with the sanction (if any) for the time being required by law." Clause 164 of the articles of association provided as follows: "If the company shall be wound up, the liquidators (whether voluntary or official) may, with the sanction of an extraordinary resolution, distribute in specie among the contributories any part of the assets of the company, and in particular any shares, stocks, or debentures of any other company which this company may be entitled to. . . ." By an agreement dated the 12th of November, 1901, it was agreed (1) that the defendant company (which was then a going concern) should sell to the Lomagunda Development Company, Limited, all the undertaking and property of the plaintiff company; (2) that, as part of the consideration for the sale, the purchaser company should pay and discharge the debts and liabilities of and perform the contracts binding on the vendor company (and respectively mentioned in a schedule to the agreement), and keep the vendor company indemnified; (3) that the vendor company should retain out of the property and assets 200l. to defray the costs and expenses of and incident to the agreement and the winding-up of the vendor company, and should hand over to the purchaser company on the dissolution of the vendor company any balance, and that if the 200!. should be insufficient to defray the costs and expenses, the deficiency, up to 100., should be paid by the purchaser company; (4) that as the residue of the consideration the purchaser or nominees 17,092 fully paid shares of 17. each of the purchaser company, to be numbered 200,001 to 217,092 inclusive." By clause 9 the agreement was declared to be conditional upon the same being sanctioned on or before the 31st of January, 1902, by an extraordinary resolution of the vendor company. At a meeting of the shareholders of the vendor company held on the 30th of December, 1901, the following resolutions were duly passed: "(1) That the conditional agreement submitted to this meeting [date and parties stated] be and the same is hereby approved and adopted, and that the directors be and they are hereby authorized to carry the same into effect with such (if any) modifications as they may think fit to assent to. (2) That this company may be wound up voluntarily, and that Mr. L. Hasluck, of, &c., be and he is hereby appointed liquidator of the company for the purpose of such winding-up.... and that the liquidator be and he is hereby authorized to distribute any of the assets of this company amongst the members in specie, and to exercise all or any of his powers and authorities by attorney." The second resolution was confirmed as a special resolution at a meeting held on the 15th of January, 1902. Doughty brought an action on behalf of himself and the other shareholders of the defendant company, claiming-(1) a declaration that the agreement was ultra vires of the company and was void; (2) an injunction to restrain the company and its liquidator, officers, servants, and agents from carrying into effect or in any way further acting upon the agreement; (3) alternatively, (a) a declaration that the company and its liquidator were not entitled to carry the agreement into effect without purchasing the interest of the plaintiff and other dissenting shareholders, and (b) an injunction to restrain the carrying out of the agreement without purchasing such interests accordingly. G. F. Hart, for the plaintiff. Astbury, K.C., and J. W. M. Holmes, for the defendant company. BUCKLEY J. said that Chitty J., in Cotton v. Imperial and Foreign Agency and Investment Corporation, [1892] 3 Ch. 454, decided that, in pursuance of a clause in the memorandum of association providing for a sale of the company's undertaking, the undertaking might be sold with a view to having no subsequent undertaking at all, the sale being made at a time when the corporation as a living thing was to come to an end. The special resolutions for winding-up in that case were negatived at the meeting at which the agreement for sale was approved, and were passed afterwards; but Chitty J. did not draw any distinction from that fact, and his decision was binding on the Court. Payne v. Cork Company, [1900] 1 Ch. 308, decided, as regarded a reconstruction which was not carried out by a sale under a power in the memorandum, that the articles could not exclude sect. 161 of the Act of 1862. The question was whether in the present case the sale was properly made by the corporation under the memorandum, or whether it was in disguise a sale by a liquidator upon terms not justified by sect. 161. His Lordship held it to be the former, and dismissed the action with costs. Sequestration-Notice of writ-Effect upon chose in action in hands of third party-Banker and customer. This was a summons by the plaintiffs asking that the London and County Banking Company might be ordered to pay into court the sum of 2047. 7s. 8d., being the balance of cash standing to the credit of the defendant H. E. Pollard in the books of the bank upon the 20th of May, 1902. The action was for administration, and to recover from the defendant a sum of money which was due from him to the testatrix, under whose will he was a legatee and executor. The defendant had been ordered to pay into court to the credit of the action the sum of 1361. 3s., which had been found due from him to the estate. He having failed to comply with that order, on the 20th of May, 1902, a writ of sequestration was issued against him. On the same day the sequestrators attended at the office of the bank, where the defendant had an account, gave the manager notice of the writ, and demanded payment of the amount standing to the credit of the defendant. According to the evidence of the plaintiffs, the manager promised the sequestrators that he would communicate with the solicitor of the plaintiffs and the sequestrators after consulting the bank's solicitors, and that in the meanwhile he would not part with any of the money then standing to the credit of the defendant. It was admitted that on the 20th of May, 1902, the amount standing to the credit of the defendant in the books of the bank was 2047. 7s. 8d. Notwithstanding what had taken place between the manager and the sequestrators, the bank subsequently paid over to the defendant a portion of his balance, and this summons was then taken out. The bank were willing to pay into court the sum of 1361. 3., but opposed the making of an order against them in respect of the larger sum. Hughes, K.C., and Marcy, for the plaintiffs, contended that the bank were not justified in paying anything to the defendant after notice of the sequestration without giving the sequestrators a reasonable opportunity of obtaining an order against the bank. They referred to Wilson v. Metcalfe, (1839) 1 Beav. 263; Miller v. Huddlestone, (1882) 22 Ch. D. 233; Ward v. Booth, (1872) L. R. 14 Eq. 195; Ex parte Nelson, (1850) 14 Ch. D. 41; Dixon v. Rowe, [1876] W. N. 266; and Daniell's Chancery Practice, 7th ed. 736. Maugham, for the bank. JOYCE J. regretted that he could not make an order in respect of the larger sum. It was laid down in the text-books that mere notice of a writ of sequestration did not bind a chose in action in the hands of a third party, and the authorities seemed to bear out that proposition. No case had been cited to shew that mere notice of a sequestration was enough, and certainly it did not create a charge. The bank submitting to pay the 1367. 3s. into court, there would be an order against them for that amount; but, having regard to what had passed between the sequestrators and the bank manager, his Lordship declined to give the bank any costs. Solicitors: S. R. Pollard; Wilkinson, Howlett & Wilkinson. G. A. S. |