But if there is any charge still subsisting and not merged, still, having regard to the terms of the conditions of sale, the Defendant is entitled to have the lands conveyed to him freed from such charge.

Mr. Karslake, in reply, cited Kilderbee v. Ambrose (24 L. J. (N. S.) Exch. 49). THE VICE-CHANCELLOR Sir W. PAGE WOOD. This is a special case depending upon the effect of the acts done by the Plaintiffs, as trustees of Sir William Stanley, with reference to the redemption of the land tax in the lifetime of one of his predecessors, when infant tenant in tail of the estate.

There are two classes of persons who may redeem the land tax under the provisions of the 38 Geo. 3, c. 60. One class consists of those who have the first right as persons [484] interested in the estate. The other class consists of strangers who are entitled to redeem, unless persons interested in the estate shall, after notice given as provided by the Act, advance the necessary money.

As regards those who are interested in the estate, rights are reserved (see 38 Geo. 3, c. 60, s. 18) to remainder-men to redeem the land tax when purchased by persons having a less estate than an estate of inheritance, which, according to the view of Lord Eldon in Ware v. Polhill (11 Ves. 257), means an estate of inheritance in feesimple, and not in tail. Persons who have only limited interests may, at the time of the purchase of the land tax, declare their option to be treated as strangers purchasing (sect. 17); and, upon so doing, they are dealt with under certain provisions in the Act by which the Receiver-General, or other person appointed for the purpose, is to pay over to the purchaser or his assigns the amount of the land tax purchased; and the land tax so purchased remains a Government charge, and subject to the ordinary incidents of the land tax. (See sects. 37 and 77.) If no such option is declared, then, upon a purchase by a person entitled to a limited interest, the lands become chargeable for his benefit, with the amount of the stock he has transferred as the consideration for the redemption of the land tax, and with the payment of a further yearly sum, by way of interest thereon, equal to the amount of the land tax redeemed. (Id. see sects. 17 and 37.)

The circumstances of this case are analogous to those in Ware v. Polhill (11 Ves. 257). A redemption of the land tax upon the whole of the lands in question was effected in the year 1799 during the infancy of the late Sir William Stanley, who, as to the portions of the lands called the Puddington estates, was infant tenant in tail, having, therefore, ac-[485]-cording to Ware v. Polhill (11 Ves. 277), a limited interest in those estates; and as to other portions called the Hooton estates he was only tenant for life.

The persons who redeemed the tax upon one of these estates were his guardians, who he had himself appointed: the persons who redeemed as to the other estates were trustees to preserve contingent remainders, and to receive the rents during minorities. In reality, neither of these parties had any distinct power of action, according to Ware v. Polhill. Lord Eldon, on the second occasion of his mentioning that case, seems to consider there is some difficulty in treating it as within the Act at all; he says it is clear the land tax was extinguished, because, the option not being exercised, the land tax quá land tax was gone, and he could not revive a statutory imposition. He says the stock itself was a charge on the rent, and he seems in his judgment to have confined it to the rent. He ultimately considered it to be simply the case of persons having changed an infant's estate from realty to personalty during his minority; and considered the infant to have an equity against them to re-establish his property in its original form; and, therefore, he decided to fix a rent-charge upon the tenant for life and remainder-man; and that was ultimately the form of the decree.

The case before me is one in which, no option having been declared by the trustees, it is clear that the land tax quá tax is gone; but there remains a charge of a sum of stock, and a charge by way of rent-charge, equal to the dividends; or, at all events, a charge by way of rent-charge, if not of a capital sum. But the charge is by way of rent, not a statutory tax enforceable by the remedies provided by the Act.

[486] In Blundell v. Stanley (3 De G. & S. 433), in which the result of such of the facts now before me as took place previously to the year 1849 was considered in reference to the question whether Sir Thomas had merged the land tax; the material

circumstances were these:-The tax had been redeemed, during the infancy of the late Sir William Stanley, in the manner I have mentioned. He died in 1800, at the age of nineteen, being competent to make a disposition of his personal estate only. The statute expressly provides, with regard to persons having limited interests, that this charge shall be held by them as personal estate; and Sir William dealt with this accordingly. He gave to his brother, who succeeded him as the next baronet, all land tax charged upon his real estates which had then lately been redeemed or purchased by his guardians and trustees, charged and chargeable with the same money, moneys or stock in the public funds, which his guardians and trustees had then contracted to pay or transfer for the same, to be paid or transferred to his executors, as to such part or instalment as his guardians and trustees should have paid or transferred at his decease, within twelve months next after his decease, and, as to the residue of such instalments, at the time mentioned in the Act, in trust for his brothers, Charles, James and Henry, and his sister Catherine. It appears in effect that the last instalments were not paid until 1802, subsequently to his death. At the time of his death his brother, who then became Sir Thomas, was an infant aged seventeen. Sir Thomas, therefore, was not of age when the last payment was made. He came of age in 1804; and from the time of his coming of age until the year 1817 he did not make any payment or deal in any way with the tax, so as to make it his property. In 1817 he settled his accounts with his guardians and trustees, and on the settlement of those accounts he recognised the pay-[487]-ment by the executors of Sir William of the sums properly payable under the will. This would make him owner of the stock and rent-charge, or, at all events, of the rent-charge. Meanwhile, in 1804, before he had thus made himself owner of the rent-charge, he suffered a recovery of the Puddington estates and settled them, reducing his interest therein to an estate for life, and covenanting against all incumbrances. In a certain sense, the land tax having been abolished, the rent-charge in lieu thereof had assumed the form of an incumbrance; so that the same point occurred in Blundell v. Stanley as occurs here; but the Vice-Chancellor does not seem to have thought that the covenant shewed any intention on the part of Sir Thomas to merge the charge. In truth, at the time of the covenant Sir Thomas had not acquired the charge, nor did he acquire it until long after he was reduced to the position of a tenant for life; and, of course, a tenant for life purchasing such a charge is to be taken as purchasing it not for the benefit of the estate, but for his own benefit; and upon the death of a tenant for life entitled to such a charge the charge vests in his personal representatives as personal estate. Sir Thomas by his will, dated in 1841, devised all his land tax, or rent-charges in lieu of land tax to which he was entitled, to trustees for sale, with a direction that his son Sir William, the present baronet, should have the option of repurchasing such land tax or rent-charges-an option which the statute would have given him at all events if the matter was not taken out of its control. Sir Thomas died; the estates were disentailed, and Sir William, the present baronet, became seised in fee of all the lands in question. Subsequently, in 1842, Sir William declared his option of repurchasing the land tax or rent-charges, pursuant to the provisions of his father's will; but after he had done so it occurred to him or to his advisers that the land tax had, in truth, been merged, and that he was not bound to purchase it or to make any payment in pursuance of that notice. It was under [488] these circumstances that the question arose before Vice-Chancellor Knight Bruce whether there was a merger; and he held that there was no merger by Sir Thomas, because he was never, except for a moment, seised in fee of the estates.

The question I have here to consider is what is the position of the present baronet, or his trustees, as to the same rent-charge. Before Sir William declared his option to repurchase the land tax or rent-charges he had made a mortgage, in which he covenanted against incumbrances. Subsequently to declaring his option he executed other mortgages, and, finally, he conveyed the whole of his property to trustees for sale, and gave them full powers of settling this question as to the land tax. The suit of Blundell v. Stanley was then instituted. It was ultimately determined in favour of the representatives of Sir Thomas; and by the decree made on the 5th of May 1849 Sir William was compelled to fulfil the notice he had given that he would exercise his option. The decree directed a conveyance to his trustees of the land tax, or rent

charge in lieu of land tax, charged on the estates; and in 1851 a conveyance was accordingly executed.

With reference to the Acts relating to the land tax, it is clear, according to Ware v. Polhill, that when this decree was made the land tax was gone, and the rent-charge only remained. The result, therefore, of the decree would be that the equitable interest in the rent-charge, as well as the equitable interest in the estates charged, was in Sir William Stanley, the estates having been already conveyed to trustees for sale, for his benefit.

The trustees, on the 22d of May 1849, put up the estates for sale. Probably the conditions were prepared at the time when they were contending that the land tax was gone. If that were the case it would not be more favour-[489]-able to their present contention, because it would imply that they were intending to sell the property as being free from land tax. The first attempt to sell was made on the 22d of May, shortly after the decree, and the property has since been sold by private contract. There is nothing in the conditions of sale relating very distinctly to the question of intention. Part of the property is mentioned to be "subject to such apportionment of the land tax as shall be made by the assessor amongst the respective purchasers," which would seem to indicate that the land tax upon that part of the property was not redeemed. However, it has been taken out of the power of the assessor. Another lot is expressed to be sold "subject to land tax, if any," implying a doubt whether it existed, and at the same time that there was some suspicion that this lot was not free. As to the other lots, it would seem there was no such suspicion, as none is indicated.

I must treat the matter according to the legal rights. The equitable interest was in Sir William, and he undertook to sell. Independently of the question of merger, a party selling is taken, prima facie, to do so free from incumbrances; and this being a charge on the estate to the whole fee-simple of which Sir William was entitled, and being no longer a statutory tax, but a charge effected by the operation of the Courts of Equity, as was said in Ware v. Polhill-not in the ordinary condition of land tax, but simply a rent-charge issuing out of property, the equitable fee-simple in which also belonged to Sir William-nothing which the trustees could do would affect the rights of purchasers after the contract. The same trustees ultimately, in effect, took a conveyance of the charge, and of the estates; and the legal effect of that must be a merger of the rent-charge; but I do not rely on this. Of course, if they had been mere trustees, and if Sir William had been only a tenant for life, that legal merger [490] would have had no effect on his equitable interest. But the equitable interest in the rent-charge, and the equitable interest in the estate in fee, were both in him; the legal interest in both was in the trustees; and Sir William, having agreed to sell free from incumbrances, cannot say that there was no merger as against the purchasers. The case is totally different from that before the Vice-Chancellor Knight Bruce, where the question was whether Sir Thomas, having only such a limited interest in the estate as I have mentioned, had merged the rent-charge; and it was held that he had not.

The first question must, therefore, be answered in the negative. The second does not arise; but, if thought worth while, it may be answered in the affirmative.

Declare that the lands mentioned in this case are not, nor is any part thereof, subject to any land tax or any yearly or other charge in respect or by reason of the redemption thereof; and that the Defendant is entitled to have the said lands conveyed to him freed and discharged therefrom.

[491] SHEPPARD v. OXENFORD. April 20, 21, 1855.

[S. C. on appeal, 3 W. R. 397.]

Partnership. Association. Legality. Receiver.

A partnership of a great number of persons was constituted before the passing of the Joint Stock Companies Registration Act. The members subscribed a certain sum, and received a sort of scrip certificate, specifying the number of shares

to which each was entitled. No deed was executed, nor was any register of shareholders kept. They occasionally held meetings, at one of which the Defendant and another person were appointed sole directors and trustees of the property of the association, which consisted of mines, plant and slaves in the Brazils. The Defendant survived his co-trustee, and, disputes having arisen, a bill was filed against him by the Plaintiff, who was a derivative shareholder by purchase of one of the scrip certificates, for an account of the receipts and payments of the Defendant, and of the debts of the association, and for payment of such debts, and a division of the profits, and for a receiver and injunction, but the bill did not pray for a dissolution. Pending a motion for a receiver and injunction the Defendant clandestinely left England for Brazil. Quere, whether the association was legal.

Held, that the Plaintiff, having been treated by the Defendant as a member of the association, could maintain the suit.

Held, also, that he had an equity to secure the property of the association; and, for that purpose, a receiver was appointed.

In 1828 the Defendant, Oxenford, and others formed an association or partnership, for the purpose of carrying on mining operations in Brazil, which they called "The National Brazilian Mining Association." They subscribed the necessary capital, and purchased mines, buildings and plant and slaves in the Brazils. No deed of settlement was ever executed, nor was the association incorporated. Upon payment of the amount of their subscriptions certificates were issued to the members in the form stated in the judgment, and the interest in the shares was treated as transferable by simple delivery of these certificates. The business of the association was managed by the directors. There were no periodical meetings of the shareholders, but some of them occasionally convened meetings; and at one of such meetings, held in August 1848, it was resolved that the Defendant, Oxenford, and a Mr. Hamilton, who had since died, should be appointed sole directors, and that all the property of the association in the Brazils should be vested in these directors on behalf of the association; and that annual reports should be laid by the directors before the shareholders in the month of May in each year; and that each of such reports should be brought down to the 31st day of the preceding December.

[492] In 1849, 1850 and 1851 the said directors printed certain statements of accounts, purporting to be accounts current for 1848, 1849 and 1850 respectively; and in the last two of such accounts they claimed balances of £3800 and £4700 to be due to the directors for advances. Hamilton died in 1853, and the Defendant, Oxenford, after his death had the entire management of the affairs of the association. In June 1853 a committee of shareholders was appointed at a meeting of the association for the purpose of investigating the affairs.

In October 1853 the Defendant published a report containing the former accounts, and also accounts for the years 1851, 1852 and half of the year 1853, according to which large further advances had been made by him in each of those years. This report also, after detailing the circumstances of the association, contained three propositions, to the effect-1. That the Defendant, if required, would make over the property to such persons as the majority of shareholders might choose, on payment to him of a sum sufficient for the liquidation of all the debts of the association. 2. That

he would sell a sufficient part of the property to pay the debts, and make over the remainder as before. 3. That he would sell the whole of the property, pay the debts, and divide the balance pro ratâ among the shareholders. And it continued, "If nothing is done speedily for relief, I shall be constrained to adopt such measures as I may be advised."

A correspondence ensued between the chairman of this committee and the Defendant; and subsequently between the Plaintiff, who was a derivative shareholder in the association, and the Defendant; the material parts of which are stated in the judgment.

[493] In March 1855 the Plaintiff filed the present bill, on behalf of himself and all the other shareholders except Oxenford, against Oxenford, for an account of all the moneys received and paid by the directors on behalf of the association, and an account of the debts and liabilities of the association, and payment thereof out of the V.-C. XIV.-18*

available assets; and for sale, if necessary, for that purpose, of part of the property, and for a division of the profits of the association among the shareholders. The bill also prayed an injunction to restrain the Defendant "from selling or otherwise disposing of or dealing with the property of the association or any portion thereof," and from removing the books from the office; and for a receiver "to receive and get in all sums of money due and owing to the association, and all remittances which may be made to or on account of the association from the Brazils or elsewhere, and generally to conduct the business and affairs of the association in the meantime,” till the accounts thereby sought should be taken.

The bill did not pray for the dissolution of the association.

The Plaintiff moved for a receiver and injunction in the terms of the prayer.

On the 22d of March the Defendant signed an undertaking not to do any of the acts which the motion sought to restrain in consideration of the Plaintiff consenting to allow the motion to stand over until the 27th; and subsequently, on a similar undertaking, it stood over until the 16th of April. On the 9th of April the Defendant secretly left England for the Brazils, leaving a letter for the Plaintiff shortly announcing his departure.

Mr. Rolt, Q.C., and Mr. Baggallay, for the motion.

[494] Mr. Daniel, Q.C., and Mr. Toller, contrà. The Plaintiff was not an original shareholder, and does not represent that he had ever contributed a shilling to the funds of the company; and the certificates of shares are not properly transferable; aud therefore the Plaintiff has no title to sustain this suit. [THE VICE-CHANCELLOR. The Defendant is a trustee, and has treated the Plaintiff as one of the cestuis que trust.] This association is not a proper partnership, but is altogether illegal. [THE VICECHANCELLOR. Has that been decided? There is no representation here that the shares were transferable, as in Blundell v. Winsor (8 Sim. 601).] [Mr. Rolt, Q.C. This case is like Sharp v. Taylor (2 Ph. 801).] Moreover, the Plaintiff has shewn no probability of danger to the property; and the Defendant, as sole director, had a right to do what he proposed, viz., to apply part of the property to protect the rest from depreciation, and to ask the Court to make a call upon the shareholders, in order to recoup advances so made: Re The German Mining Company (4 De G. Mac. & G. 19). And a receiver of mining property will not be granted without a very strong case, because of the probable injury to such a concern: Norway v. Rowe (19 Ves. 144). And parties interested in mines receive no favour in this Court where they have not been most vigilant and active in asserting their rights; Prendergast v. Turton (1 Y. & C. C. C. 98).

Mr. Rolt, Q.C., in reply.

THE VICE-CHANCELLOR reserved judgment.

April 21. THE VICE-CHANCELLOR Sir W. PAGE WOOD. In this case the bill is filed by a shareholder, as he is [495] termed, on behalf of himself and all other the shareholders in the partnership or association called the National Brazilian Mining Association, against the Defendant, Oxenford, who has been appointed a trustee and director for the so-called shareholders in this association. The constitution of the association is of a singular character, and although it is said there are many companies of a similar nature, I think there will be some difficulty at the hearing in determining what is to be done with respect to a company so constituted; and if a demurrer had been put in to this bill there would have been a question how far the relief prayed by it could be granted. But the question now is whether there is not enough in the absence of a demurrer to bring the case within the decision in Walworth v. Holt (4 My. & Cr. 619), so as to enable me to provide for the security of the property, which seems to be the full extent of the relief which I can give.

The association itself is of such a nature that it is difficult to understand how it can be effectually worked if any dispute should occur. Whether it is even legal is a question which I need not, however, determine upon this application. The ground for considering it illegal is on account of the members of it assuming to act as a corporation, which was remarked upon in Blundell v. Winsor (8 Sim. 601) and Duvergier v. Fellowes (5 Bing. 248). I doubt, however, whether this company have held themselves out as a legal corporation, who could give to their shareholders the right of relieving themselves of all responsibility upon the sale of their shares. They