1851.-Onions' Case.

*IN THE WINDING-UP OF THE DIRECT BIRMINGHAM, [*394] OXFORD, READING AND BRIGHTON RAILWAY COM

PANY.

ONIONS' CASE.

Joint-stock Companies' Winding-up Acts.—Contributory.—Acceptance of Shares.

1851: 28th May.

The secretary to a company wrote to A., a member of the provisional committee, informing him that the managing committee had apportioned one hundred shares to each member of the provisional committee, and requesting to be informed, on or before a certain day, whether A. would take that or any less number of shares, otherwise the committee would consider that he declined taking any. A., in answer, requested that the one hundred shares might be reserved for him. The court directed an issue to try whether A. had accepted the shares.

THE secretary to the company wrote a letter to Mr. Onions, a provisional committeeman, dated Moorgate Street, 10th of October, 1845, and in the following words:-"Sir: I am requested to inform you that the committee of management has apportioned one hundred shares in the company to each member of the provisional committee. You will please inform me, on or before Wednesday morning next, whether you will take that or any less number of shares. Should you not reply by that time, the committee will consider you decline taking any." Mr. Onions' answer to that letter was dated Brosley, the 14th of October, 1845, and was as follows:-"Sir: In reply to your circular of the 10th instant (which only came to hand this morning), informing me that I am entitled to one hundred shares in the Direct Birmingham, Oxford, Reading and Brighton Railway Company, and requesting an answer on or before to-morrow morning, I have to request that number of shares may be reserved for me."

The question was, whether Mr. Onions' letter amounted to ax acceptance of the shares.

*The VICE-CHANCELLOR said that his acquaintance [*395] ' with mercantile language was not sufficient to enable

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1851.-Upfill's Case.

him to decide that Mr. Onions had accepted the shares by requesting that they might be reserved for him; and that he should direct an issue, in order that the question might be determined by a jury.

Mr. Bethell, Mr. Rolt, Mr. W. T. S. Daniel and Mr. Roxburgh were the counsel in the case

IN THE WINDING-UP OF THE DIRECT BIRMINGHAM, OXFORD, READING AND Brighton RAILWAY COMPANY.

UPFILL'S CASE.

Joint-stock Companies' Winding-up Acts.—Contributory.—Call.

1851: 1st, 2d and 28th May

The Master ought not to make a call on any contributory, until he has ascertained that the contributory is liable to pay the debt or debts in respect of which the call is made.

THE above-mentioned company was registered provisionally only. After Mr. Upfill's name had been placed on the list of contributories, pursuant to the decision of the House of Lords, (a) the Master made an order for a call of 21. 12s. 6d. per share, upon that gentleman and certain other persons named in the list. That order was founded on a financial statement made by the official manager, from whence it appeared that certain debts remained due from the company: but there was nothing to show that Mr. Upfill, or any of the other individuals on whom the call was [*396] made, were liable to pay the debts *in respect of which the call was made; and, on that account,

Mr. Rolt and Mr. W. T. S. Daniel, for Mr. Upfill, now moved that the order for the call might be discharged. They said that a state of facts ought to have been laid before the Master, before

(a) See Hutton v. Upfill, 2 House of Lords Cases, 674.

1851.-Upfill's Case.

he made the order, showing that the debts were incurred after Mr. Upfill had consented to be a provisional committeeman and to take shares in the company; and showing also which of the debts were incurred by Mr. Upfill's order or under his authority, and that they were necessarily incurred in launching the con cern: that the liability to be a contributory and the liability to a call were not the same thing: that the question as to Mr. Upfill's liability to the call was still open, notwithstanding the decision of the House of Lords: that that decision had established only one step towards his liability; and that the Master had no power to make a call upon a contributory, until he had astertained that the contributory had, either expressly or impliedly, given authority to incur the debt for payment of which the call was made, or had guaranteed the payment of it. They referred to the judg ment in Hutton v. Upfill, pages 691, 692 and 694, and to Lloyd's case,(a) James' case, (b) Bell v. Lord Mexborough (c) and the 83d section of the Winding-up Act of 1848, 11 & 12 Vict. c. 45.

Mr. Bethell and Mr. Roxburgh, for the official manager, said that the judgment of the House of Lords decided that, from and after the date of the letter in which Mr. Upfill said, "I accept the one hundred shares allotted to me," the provisional committee had power to *bind him by their acts and [*397] engagements, and all things done by them were done as his agents.(d) They relied on the 28th section of the Windingup Act of 1849, 12 & 13 Vict. c. 108; and, in order to show its full force, contrasted it with the 84th section of the act of 1848, which it repealed. They further said that the order for winding up a company was equivalent to a judgment in favor of all the creditors of the company: that the selection of the parties to pay the call, and the distribution of the call amongst them, were equally at the unrestricted discretion of the Master: that, if there were sixty persons on the list of contributories, the Master might order one of them to pay ten shillings and another ten pounds; or any one of them to pay the whole amount of the call; and

(a) Ante, 248.

(b) Ante, 140.

(c) 5 Railway Cases, 149.

(d) See 2 House of Lords Cases, 691

1851.-Upfill's Case.

that, too, notwithstanding there might be, eventually, one hun dred contributories; and, that the party or parties who had paid the call might require the Master to compel contribution from the other contributories, which the Master had power to do under the acts.

The Vice-Chancellor.-Mr. Bethell has, to a great extent, satisfied me that, if Upfill was liable, with others, to debts amounting to 1,000, the Master might make a call, to pay that sum, upon Upfill alone. But I cannot think that the Master might make a call, upon him alone, to pay the whole of the debts of the company, amounting, perhaps, to 100,0007.

Mr. Rolt replied.

20th May.-THE VICE-CHANCELLOR :-The ques[*398] tion in this case arises upon an order of the *Master of the 20th of December, 1850, whereby he has ordered a call, of 21. 12s. 6d. a share, on several contributories who are named in the order, including Mr. Upfill. A motion was made, before me, to discharge that order.

The decision of the House of Lords in Upfill's case, established this proposition, simply: that Mr. Upfill was to be placed on the list of contributories, as a contributory in respect of one hundred shares. Then the question arises, what is the effect of that decision? According to the interpretation-clause in the Winding-up Act, it decides that Mr. Upfill is liable to contribute to the payment of some debt of the company, that is, according to the construction which has been put upon these words, to some debt of the body of persons that were associated for forming the company. The last words of Lord Brougham's judgment in Upfill's case, negative the notion that merely being placed on the list of contributories, at all showed what was the extent of the liability of the contributory. The being a contributory in respect of one hundred shares not showing in respect of what he is to contribute, it would seem to follow, of course, that it does not show in respect of what debts he is to contribute. Now, the power of the

1851.-Upfill's Case.

Master to make calls, depends on section 83 of the first act, and section 28 of the second act. Section 83 enacts: That at any time before the whole of the assets of the company shall have been collected or converted; and, if the assets remaining to be collected or converted shall not be capable of being immediately realized, although such assets may not appear to be insufficient; and also, after the assets of the company shall have been wholly exhausted, it shall be lawful for the Master, from time to time, to make calls on the contributories, or on such individual contributories or classes of contributories as he may think proper (but so far only as such contributories respectively shall [*399] be liable, at law or in equity, to pay the same) as well

for raising such amount as may be necessary to pay the debts or liabilities, or any of the debts or liabilities of such company, or any part thereof, or the costs, charges and expenses of winding up the same; as also for the purpose of adjusting and settling the respective claims of contributories upon each other, or upon the company, whether such claims shall have arisen since or before the date of the petition for dissolution and winding-up, or for winding-up, as the case may be," and for payment of the costs. Then there is, in section 84, a direction as to apportioning the amount of the calls; but I do not pay any attention to that, because, by the subsequent act, that clause was expressly repealed and a new clause introduced instead, namely, section 28, which enacts as follows: "That so much of the said recited act as is contained in the section thereof numbered 84," (that is the section to which I have alluded,) "shall be repealed; and, in lieu thereof, that, when the Master shall think proper to raise any money by means of a call, he shall make such call, from time to time, upon the contributories of the company, or any of them, appearing, for the time being, on the list of contributories, although it may then be under consideration or uncertain whether other persons ought or ought not to be included in the list; and, in making any such call, it shall be lawful, for the Master, to fix such an amount per share for the same, as shall, in his judgment, be likely to supply and bring in the whole sum for the time being intended to be raised, after taking into consideration the probability that some of the contributories upon whom the said call