THE WOLVERHAMPTON NEW WATERWORKS COMPANY v. HAWKESFORD. April 28.

The 21st and subsequent sections of the Companies Clauses Consolidation Act, 1845 (8 & 9 Vict. c. 16), do not authorize an action against a "subscriber to the undertaking" for calls. Whether a party may be a "shareholder," without being on the register,—quære?

A count alleged that the defendant subscribed a certain sum to the undertaking, and that certain portions thereof were called for, and places and times appointed for the payment thereof, and that the defendant had due notice of the premises, and that the plaintiffs (the company) did all things necessary to entitle them to have the calls paid, but that the defendant made default:-Held, that the count disclosed no cause of action,-inasmuch as it did not show that the defendant was a "shareholder" within the act.

THIS was an action against the defendant, a subscriber to The Wolverhampton New Waterworks Company, for calls. The second count of the declaration stated, that the defendant subscribed 6000l. towards the undertaking and works which were by the Wolverhampton New Waterworks Act, 1855 (18 & 19 Vict. c. cli.), authorized to be executed, and divers portions thereof, amounting to 45007., were called for by the plaintiffs, being the company constituted by the said act, and the plaintiffs appointed certain places and times for the payment thereof respectively, and the defendant had due notice of the premises, and the said times elapsed, and the plaintiffs did all things necessary to entitle them to have the said sums, amounting to 45007., paid to them by the defendant; yet the defendant made default in paying the same, contrary to the said act, and the same are still in arrear and unpaid and due from the defendant to the plaintiffs.

The defendant pleaded, sixthly, to the second count, on equitable grounds, that divers other persons subscribed large sums of money respectively towards the said undertaking therein mentioned, which, at the times of the making of the said alleged calls in the *second

count mentioned, remained and still were wholly unpaid, and [*337 that the plaintiffs did not, nor did any other persons, at any time call for the payment by the said other subscribers, or any of them, equally with the defendant, of the said sums subscribed by them respectively, or any part thereof.

He also demurred to the second count; the ground of demurrer stated in the margin being, "that the second count shows no contract under seal, and no undertaking by the defendant to pay the moneys called for, nor any liability on the defendant to pay the same." Joinder.

The eighth plea, to the second count, stated that the subscription in that count mentioned was and is the execution by the defendant of a certain indenture made and executed, before the passing of the said act, by and between the defendant and the other persons therein and hereinafter mentioned, of the one part, and Thomas Spencer and George Lees Underhill, both respectively hereinafter mentioned, of the other part, and which said indenture was signed, sealed, and delivered by the parties thereto respectively, and was and is to the tenor following, that is to say, "Subscription contract. This indenture, made the 20th of December, 1854, between the several persons whose names and seals are respectively subscribed and affixed to the schedule hereunto annexed, VOL. VI., C. B. (N. S.)-14

being subscribers to the undertaking hereinafter mentioned, of the first part, and Thomas Spencer, of, &c., and George Lees Underhill, of, &c., trustees for the purpose of enforcing and giving effect to the covenants hereinafter contained, of the second part, Witnesseth that each of the said several parties hereto of the first part doth hereby for himself and herself, his and her heirs, executors, and administrators, but to the extent only of the sum or amount of *subscriptions set opposite *338] his or her name in the said schedule, and not further or otherwise, covenant, promise, and agree, to and with the said Thomas Spencer and George Lees Underhill, their executors and administrators, and doth hereby bind himself and herself, and his and her heirs, executors, and administrators, in manner following, that is to say, that each of them the said several persons parties hereto of the first part hath subscribed and doth subscribe the sum set opposite his or her name in the said schedule, to be recoverable by action at law, for the purpose of enabling the company, to be hereafter incorporated by act of parliament under the name of The Wolverhampton New Waterworks Company, to supply with water the town and parish of Wolverhampton, and the parishes of Tettenhall and Codsall, in the county of Stafford, and also the parishes and places following, that is to say, Donington, Albrighton, and Boningale, or Boninghall, in the county of Salop, and for that purpose to take and acquire land and other hereditaments, and to divert streams, brooks, rivulets, and springs, and to appropriate and impound the water thereof; and also to enable the said company to make and maintain the works hereinafter mentioned, that is to say, a reservoir situate in a certain valley between Ruckley Wood Farm and Neachley Hill, extending from within a short distance of the road leading from Albrighton to Ruckley to a dam or embankment near to the Shrewsbury and Birmingham Railway, in the parishes of Donington and Tong, in the said county of Salop, and also a surface or supply reservoir and pumping station situate in a certain place near to the Holyhead Road, to the north side thereof, at or near to King's Wood, in the parish of Tettenhall aforesaid, with all proper works, roads, approaches and conveniences thereto respectively belonging, and from such pumping station *339] *to make and maintain an aqueduct or aqueducts from the said last-mentioned reservoir to the centre of the town of Wolverhampton, with branches to the said service reservoir and pumping station situate in a certain place in the said parish of Tettenhall aforesaid, and belonging to the Wolverhampton Waterworks Company, and to lay down conduct, main, and other pipes, with all necessary and proper works and conveniences thereto respectively belonging, such works to be constructed in the manner and to the extent defined and shown on certain plans and sections of the said several works which were depos ited with the clerks of the peace of the said counties of Salop and Stafford respectively on or before the 30th of November last, with full power and authority to the directors of the said company from time to time to alter and vary the sites or spots at which the several intended works before mentioned shall commence and terminate, and the lines and levels thereof; and also to fix and determine, and from time to time alter and vary, the extent and situation of the said works, and to change the name of the proposed undertaking, and to substitute in lieu thereof such

other name or names as the said directors shall think proper; and to enter into such contracts and agreements with land-owners and others or with any company or companies, for any purposes whatever in any way affecting or connected with the said undertaking; and to make application to parliament for an act or acts, and thereby to take powers to execute all or any of the said works; and also to purchase, take, and hold the works of The Wolverhampton Waterworks Company, and all reservoirs, aqueducts, mains, pipes, and other works and lands, and other the property, estate, and effects of the same, and all powers, rights, and privileges which may have been or may be vested in the *said [*340 company under the acts hereinafter mentioned, that is to say, The Wolverhampton Waterworks Act, 1845 (8 & 9 Vict. c. cxxv.), and The Wolverhampton Waterworks Amendment Act, 1850 (13 & 14 Vict. c. lxxiv.), and for that purpose to repeal either wholly or in part, and to alter and amend the said acts; and also to take powers to enable the Wolverhampton Waterworks Company to sell and transfer to the said intended Wolverhampton New Waterworks Company their said works, lands, and other their said property, estate, and effects, and the rights, powers, and privileges connected with or belonging to the same; and also to take powers to enable the said intended Wolverhampton New Waterworks Company to transfer to and vest in the corporation of the town of Wolverhampton, or some other board of commissioners to be by the said act or acts appointed, the whole undertaking of the said company or companies, and the works, lands, and other the property and estate, rights, and privileges connected with or belonging to the same, and to abandon if they think fit, or defer the application to parliament in respect of, the whole or any part or parts of the said proposed undertaking; and generally to do and perform all such acts, deeds, matters, and things, as they in their discretion shall deem necessary or desirable for the attainment of such objects, or any of them: And this indenture witnesseth, that each of them the said persons parties hereto of the first part doth hereby for himself and herself, his and her executors and administrators, further covenant, promise, and agree to and with the said Thomas Spencer and George Lees Underhill, their executors and administrators, that he and she, and his and her heirs, executors, and administrators, shall and will well and truly pay or cause to be paid the full amount subscribed by him or her, or such part thereof as shall not have been paid by him or her at the time of his or her execution of these presents, and at such places and times and in such [*341 manner as may be required by any act of parliament which may be passed in the next or any subsequent session of parliament for the purposes aforesaid, or as the directors or others authorized by such act shall lawfully direct or appoint; it being the express meaning and intention of each of them the said parties hereto of the first part, that the amount so subscribed by him or her shall be recoverable from him or her, his or her heirs, executors, and administrators, by the said parties hereby of the second part, or the survivor of them, his executors or administrators, by action at law, in case default should be made in payment thereof. In witness," &c.

Averment that the subscription in the second count mentioned was and is the subscription aforesaid, and not any other or different subscription; and that no places or times for the payment of the amount subscribed by the defendant, as subscriber, by virtue of the said indenture, or any part thereof, in satisfaction of the covenant therein contained, ever was appointed by the plaintiffs, or at all.

The plaintiffs demurred to the sixth plea; the ground of demurrer stated in the margin being, "that the 21st section of the Companies Clauses Consolidation Act, 1845, does not make it imperative to call up

subscriptions pari passu, and that the plea shows no ground entitling the defendant to have them all called up pari passu." Joinder.

*They also demurred to the eighth plea; the ground of demurrer stated in the margin being, "that the eighth plea does [*343 not deny the appointment of time and place absolutely, but merely that no time or place was appointed for payment in satisfaction of the covenant; and the parts sued for of course would not be payable in satisfaction of the covenant." Joinder.

Mellish (with whom were Bovill, Q. C., and Hawkins, Q. C.), for the plaintiffs. (a) The first question is as to the validity of the second count. By the 7th section of the Wolverhampton New Waterworks Company's Act, 18 & 19 Vict. c. cli., the persons named (in[*344 cluding the now defendant), and all other persons and corporations who have already subscribed or who shall hereafter subscribe to the undertaking by that act authorized, and their executors, administrators, successors, and assigns respectively, are incorporated, with the usual powers. By s. 17 the qualification for a director is declared to be "the possession in his own right of one hundred shares at least in the undertaking." By s. 19, the now defendant is named as one of the first directors. The 21st section of the Companies Clauses Consolidation Act, 1845 (8 & 9 Vict. c. 16), enacts that "it shall be lawful for the company from time to time to make such calls of money upon the respective shareholders, in respect of the amount of capital respectively subscribed or owing by them, as they shall think fit, provided that twenty-one days' notice at the least be given of each call, and that no call exceed the prescribed amount, if any, and that successive calls be not made at less than the prescribed interval, if any, and that the aggregate amount of calls made in any one year do not exceed the prescribed amount, if any; and every shareholder shall be liable to pay the amount of the calls so made, in respect of the shares held by him, to the persons and at the times and places from time to time appointed by the company. And the 26th section provides, "that, in any action or suit to be brought

(a) The points marked for argument on the part of the plaintiffs, were as follows:"The second count is good, according to the Companies Clauses Act, 8 & 9 Vict. c. 16, s. 21, and s. 2 (which explains the word undertaking), and s. 8, which shows that a subscriber, if his name is not on the register, is not a shareholder, and according to the special act, 18 & 19 Vict. c. cli., s. 7, which incorporates all who had subscribed or should subscribe to the undertaking. It is sufficient to say that defendant 'subscribed,' without saying how, and it was so held in The Great Northern Railway Company v. Biddulph, 7 M. & W. 243.†

"The 6th plea is bad, for, amongst other reasons,-first, that, if equity would restrain, it would not grant a perpetual injunction, but only restrain till the other subscribers were called upon but, secondly, that the plea shows no obligation to call on all pari passu, and the 21st section of the Companies Clauses Consolidation Act does not create such an obligation, and there may be numberless cases imagined why all should not be called upon.

"The 8th plea is bad, because the 21st section, by making the subscriptions payable to the company, gives the company a right of suit, and the plea must be taken to admit, as alleged in the second count, that times and places were appointed for payment, and then to assert that such times and places were not appointed for payment in satisfaction of the covenant, which, whatever it may mean, is not required by the 21st section. The payment of the portions sued for, of course, was not appointed to be made in satisfaction of the whole covenant.

"The only substantial question is, whether the 21st section gives the company a right of suing subscribers who are not shareholders. If the form of subscription gives a right of action to no one, and the 21st section does not give a right of action to the company, the enactment that the subscriptions are to be paid is nugatory.

"It is not necessary for the plaintiffs to contend that the trustees of such a covenant as appears in this case cannot sure. They only have to contend that the company may sue."