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trustees might at any time call upon any creditor to assent within seven days under pain of exclusion; but that they should have power to revoke any such exclusion and to admit any such creditor on receiving his assent; but it was further provided that the trustees should have no power to admit any creditor who should not assent within the before-mentioned three months. Held, that this was a deed for the benefit of all the creditors who wished to take part in it, and that it therefore came within the exceptions in sect. 4 of the Bills of Sale Act 1878, and did not require to be registered as a bill of sale. (Hadley and Son v. Beedon; Leicester and another, claimants.) ...page 493 Attestation by agent of party thereto-Consideration -True statement of-Term for maintenance of the security. An agent of the grantee of a bill of sale may be an attesting witness of the execution thereof within the meaning of sect. 10 of the Bills of Sale Act 1882, which requires the execution of a bill of sale to be attested by a credible witness, not being a party thereto. A debtor, in order to pay an agreed composition to his creditors, obtained a loan of 1501. from certain of those creditors, and in consideration thereof granted a bill of sale to such creditors to secure this advance of 150., and their own compositions. This advance was made by cheques payable to the joint order, and paid into the joint account, of the grantor and one L., the agent of one of the grantees, who was to see to the payment of the compositions to the other creditors, the joint account being opened for the purpose of enabling L. to make the payments. It was said that the consideration was not truly stated by reason of the 1501. having been paid to the joint order and into the joint account of the grantor and L. instead of to the grantor himself: Held, that the advance was really made to the grantor for the purposes correctly set forth in the bill of sale, and that the arrangement made as to the joint account did not alter the character of the consideration, which was therefore truly stated. A stipulation in the bill of sale provided that "the grantor shall not during the course of this security obtain credit to the extent of ten pounds without the consent of one of the parties hereto

and

shall bind himself to give the said firms the greater portion of his business, and shall keep proper books of account of his business, and shall permit the parties hereto, or any authorised agent of them or any of them, to enter the premises of the grantor and inspect the said books at all reasonable times during the existence of the security." Held, that this was not a term for the maintenance of the security, and that the bill of sale was therefore not in accordance with the form in the schedule and was void. (Peace and others, Claimants, v. Brookes, Execution Creditor.)...

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Consideration-Trust - Bills of Sale Act 1878Bills of Sale Act 1882.-By sect. 10 (3) of the Bills of Sale Act 1878: "If the bill of sale is made or given subject to any declaration of trust not contained in the body thereof, such declaration shall be deemed to be part of the bill, and shall be written on the same paper or parchment therewith before the registration, and shall be truly set forth in the copy filed under this Act, therewith and as part thereof, otherwise the registration shall be void." By sect. 8 of the Bills of Sale Act 1882: " Every bill of sale

shall truly set forth the consideration for which it was given, otherwise such bill of sale shall be void in respect of the personal chattels comprised therein." Six persons joined together to advance the sum of 600l. to S. They contributed the loan in different amounts, and at different times. When the whole 6001. had been advanced, S. gave a bill of sale to T., one of the six, to secure the loan of 6001. The consideration was therein stated as 600l. now paid by T. Held, that this was a true statement of the consideration, and that T. was not a trustee, but merely a collector

798

for the six lenders. (Re Smith; Ex parte Tarbuck.)... ...page 59 Non-registration - Bankruptcy -Assignment with intent to defeat or delay creditors.-The appellant made an advance in good faith to C. who was at the time solvent, and took a bill of sale as security. The bill of sale was not registered at the wish of the appellant. C. afterwards became bankrupt, and the appellant did not take possession under the bill of sale till just before the bankruptcy. Held, that the bill of sale was not void as having been made with intent to defeat or delay credi tors. (Morris v. Morris, Assignee of the Estate of Cook.) 879

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66

BOND.

Construction "Representatives" Death of obligor-Notice of death to holders of bond-Liability of estate of obligor.-Where a bond given to secure an account contained a provision that a month's notice in writing should be given by obligors, 'or their respective representatives," in order to determine the liability, and notice of the death of an obligor was given by his executor to the holders of the bond, but no special notice was given to determine the liability, of which the executor was wholly unaware: Held, that the word "representatives must be held to include "legal personal representatives," and as the special notice contemplated by the bond had not been given, the estate of the deceased obligor was liable for his contribution under the bond. (Re Silvester; The Midland Railway Company v. Silvester.)

BUILDING CONTRACT. Construction-Non-completion by date specifiedPenalty for delay-Proviso to terminate contract and re-enter-Liquidated damages-Assignment of contract-Right to deduct from retention moneys-Liability of assignee.-In a building contract, by which one Brigg contracted with the respondent company to construct a reservoir, it was provided that, in case the works should not be completed by the 30th Sept. 1891, the company should have the right to deduct from the retention money, as and for liquidated damages, the sum of 5001., and 51. a day for each day from such date until completion. Also that, should the contractor become bankrupt or insolvent, it should be lawful for the company" to terminate the contract so far as respects the performance of the same under the directions and by means of the contractor, but without thereby affecting in any other respects the liabilities of the said contractor." The time for completion was extended until the 31st Dec, 1892, and subsequently until the 16th Jan. 1894. In Nov. 1894 the contractor was unable to continue the works, and the company re-entered and took possession. Thereupon the appellant took from the contractor an assignment of "all the estate, part, share, and interest of the said contractor of and in the contract, and the full benefit and advantage thereof, and all rights, powers, and privileges of the contractor thereunder." On the 5th Dec. 1892 it was agreed between the appellant and the company that the appellant should complete the works in accordance with the original contract. The appellant completed the works on the 22nd Sept. 1893. The company claimed to deduct certain sums as liquidated damages from the retention money. The matter was referred to an arbitrator, who found, as a fact, that the delay in completion was due to the delay of the original contractor, but decided that the company were entitled to deduct from the retention moneys the

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sum of 17451., being 5001. for non-completion on the extended date, and 51. per diem for each day between the extended date and the date of actual completion. The arbitrator stated a special case. Held, that the words " but without thereby affecting in any other respects the liability of the contractor," contained in the proviso as to terminating the contract, effectually kept alive the company's right to deduct liquidated damages from the retention money; and that by the agreement of the 5th Dec. 1892 the appellant was subject to the contractual liabilities of the original contractor, and to the aforesaid deduction in the settlement of accounts as between himself and the company. (Re an Arbitration between the Yeadon Waterworks Company, resps., and J. A. Binns, the Trustee of J. Brigg, a bankrupt, and Samuel Wright, app.)... ...page 538, 832

BUILDING SOCIETY. Deed of dissolution-Alteration of rights of members-Withdrawing members.-The priority of repayment of members of a building society, who have given notice of withdrawal, cannot be abrogated by an instrument of dissolution executed pursuant to sect. 32 of the Building Societies Act 1874. (Botten v. City and Suburban Permanent Benefit Building Society.) Mortgage-Power to lend on first mortgage-Part payment of mortgage moneys by third personPostponement of security in favour of third person -Second mortgage-Borrowing powers-Ultra vires-Subrogation. (The Portsea Island Building Society v. Barclay.)

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Unadvanced shareholders-Withdrawals-Priority of payment.-The rules of a building society, incorporated under the Building Societies Act 1874, provided that: "Upon giving one month's notice in writing to the secretary of his intention so to do, any member may withdraw his investments at any monthly meeting of the society, the amount to be repaid out of the moneys received from members in repayment of advances on the night for withdrawal, but should the repayments not be sufficient, the balance shall be paid from the same fund on the next or following monthly night. If several members shall give notice to withdraw within any one month, they shall be paid pro rata; but the directors shall have power, after a resolution of the board, to use the monthly subscriptions upon investments to assist in repaying withdrawals. The directors shall also have power in their discretion to make prior payments to any member leaving not more than 501. standing to his credit in the books of the society upon such terms as may be arranged between the member and the directors, should the directors deem the same beneficial to the society. Provided always that the widow and children of lunatic or deceased members shall have the precedence.' (Botten v. The City and Suburban Permanent Benefit Building Society.) ...

BURIAL GROUND.

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744

87, 375

Disused burial ground-Prohibition of buildingSite of dismantled church - Vaults used for burial.-In July 1894 the site of the Church of Allhallows the Great was put up for sale by the Ecclesiastical Commissioners in pursuance of a scheme under the Union of Benefices Act 1860 (23 & 24 Vict. c. 142), whereby the benefice of that church had been united to two adjoining benefices, and the site directed to be sold, and the proceeds applied in the erection of another church in the metropolitan area. The vaults of the church had been used for burial, but the remains therein had some time before the sale been removed under the special powers contained in that Act. The site was described in the particulars as a valuable freehold corner building site. The purchaser objected to the title on the ground that the site was a disused burial ground within the meaning of the Disused Burial Grounds Act 1884, which forbids the erection of any building on disused

burial grounds. By the joint effect of this Act, the Metropolitan Open Spaces Act 1881, and the Open Spaces Act 1887, the term "disused burial ground" is defined to mean any ground which has been at any time set apart for the purposes of interment. Held, that sect. 5 of the Disused Burial Grounds Act 1884 applied to sales after as well as before that Act, that the site of a church in which burials had taken place was not ground. set apart for the purposes of interment within the meaning of that Act, and that the Disused Burial Grounds Act could not have been intended to repeal the express provisions of the Union of Benefices Act 1860. The purchaser's objection was therefore overruled. (Re The Ecclesiastical Commissioners of England and The New City of London Brewery Company Limited.)

CERTIORARI.

...page 481

Quarter sessions - Amendment of conviction Imprisonment with hard labour in default of distress-Striking out of words "hard labour." S. was convicted in a court of summary jurisdiction on an information under the PublicHealth (London) Act 1891, for not abating a nuisance, and was fined 101. and costs, or in default of sufficient distress was ordered to be imprisoned with hard labour. S. paid the finewithout appealing. Held, upon a rule for a certiorari, that the conviction must be quashed, as the Act does not authorise hard labour for such an offence. S. was also convicted on another information under the same Act for disobeying a closing order, and the conviction in this case was drawn up in the same form as in the last case. S. did not pay the fine, but appealed to the quarter sessions, when the justices, on evidence that it was owing to an oversight on the part of the clerk when drawing up the conviction that the words "hard labour were mentioned, amended the conviction under sect. 7 of Baines's Act, affirmed the conviction as amended, and dismissed the appeal. Held, upon a rule for a certiorari, that the decision of the quarter sessions was right._(Reg. v. Slade and others; Ex parte Saunders. Reg. v. Justices of London and others; Ex parte Saunders.) 568

CHARITY. Administration - Scholarship fund-Action by person claiming to be entitled to scholarshipConsent of Charity Commissioners.-Under the provisions of a deed founding a scholarship, the scholarship was to be awarded to the pupil leaving a certain school who should pass the best examination in subjects to be determined from time to time by the examiners for the scholarship. The trustees announced an examination for June 1894, at which the plaintiff and another pupil were the only candidates, and the plaintiff obtained the larger number of marks, but the trustees declined to award the scholarship. The plaintiff thereupon commenced an action against the trustees, and claimed by the statement of claim a declaration that he was entitled to the possession and enjoy. ment of the scholarship. The defendants moved for a stay of all further proceedings in the action on the ground that the plaintiff had not before commencing the action obtained the consent of the Charity Commissioners pursuant to sect. 17 of the Charitable Trusts Act 1853. Held, that the claim presented did not show a case of contract between the plaintiff and the trustees, and that the plaintiff's alleged individual equitable right related to and involved the partial execution or administration of the trusts of the charity deed, and therefore that the action could not proceed without the certificate of the Charity Commissioners. (Rooke v. Dawson.)

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Devise to, by will, of reversionary interest in landMortmain. The provisions of sect. 4 of the Mortmain and Charitable Uses Act 1888 are perfectly independent of the provisions of sect. 5 of the Mortmain and Charitable Uses Act 1891, and the restrictions imposed by sect. 4 of the former are inapplicable to dispositions by will under sect. 5

248

of the later statute. An assurance of land by will to or for the benefit of any charitable use is therefore valid, notwithstanding the fact that the interest in the land is reversionary Sub-sects. 1, 2, 3, and 6 of sect. 4 of the Mortmain and Charitable Uses Act 1888 are not inconsistent with, and have not been repealed by, sect. 5 of the Mortmain and Charitable Uses Act 1891, but still apply to an assurance of land by deed to or for the benefit of any charitable use. (Re Hume; Forbes v. Hume.)

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COLONIAL LAW. Canada, Law of Canadian Railway Act 1888 (51 Vict. c. 29), s. 161, sub-sect. 2-ArbitrationAward-Appeal-Duty of Superior Court.-By sect. 161, sub-sect. 2, of the Canadian Railway Act 1888 (51 Vict. c. 2o) an appeal lies to the Superior Court from the award of arbitrators in respect of compensation for land taken and injury done by a railway company in the exercise of their statutory powers, where the amount exceeds a certain sum; and the section directs that the court shall upon the hearing of the appeal. "if the same is a question of fact," decide the same upon the evidence taken before the arbitrators' as in a case of original jurisdiction." Held, that the intention of the section was that the court should examine into the facts as well as the law, and decide as to the justice of the award upon the merits; and that they should supersede the arbitrators, and entirely disregard their award and the reasoning in support of it. (Atlantic and North-West Railway Company v. Wood and others.) Cape of Good Hope-Joint-stock company-Memorandum of association-Business to be carried on in the colony-Licence-Duty.-By sched. 17 to the Colonial Act, No. 3, of 1864 every joint-stock company, any of the dealings of which shall, by the deed or other instrument regulating such company, be described as to be carried on in this colony," shall take out an annual licence and pay a stamp duty at a certain rate. The memorandum of association of a limited company having its principal office in England declared that one of the objects of the company was "to carry on in any part of the world the business," &c. The company carried on business through an agent in the Cape Colony. Held, that the company was not liable to stamp duty under the schedule, which was intended to apply only to companies in whose constitution there was something specially pointing to the colony as a place of business. (Marshall v. Orpen.)...

Landlord and tenant-Right of tenant to remove buildings erected during tenancy.By the law of the Cape of Good Hope a lessee who annexes materials, not being growing trees, to the soil, is presumed to do so for temporary, not perpetual, use; and as between himself and the owner of the land does not during the tenancy lose his property in such materials, but may, before the expiration of his term, sever them and remove them from the land. A lease contained a proviso" that if no rent shall be due and unpaid the lessees shall be at liberty during their tenancy to remove all such improvements (save and except boundary fences) as should be capable of removal without injury to the land itself.' Held, that the effect of the lease was not to deprive the lessees of their common law right to remove a substantial brick building, with stone foundations eighteen inches deep, erected by them on the land. (London and South African Exploration Company v. De Beers Consolidated Mines Company.) ... Colonial Government-Servants of Crown-Tenure of office-Colonial Office Regulations-Appeal by special leave Practice Costs. A colonial Government stands on the same footing as the Crown in England in relation to the employment and dismissal of public servants.-The Colonial Office "Regulations" do not form part of the contract of employment with such servants.-Servants of the Crown hold their offices at the pleasure of

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238

783

609

Lower Canada, law of-Code of Procedure, arts. 154, 997-Powers of Attorney-General-Power to discontinue action-Mandamus.-Bv art. 703 of the Revised Statutes of Quebec, 1888 the AttorneyGeneral has the functions and powers which belong to the office of Attorney-General and SolicitorGeneral of England respectively by law or usage, in so far as the same are applicable to the province. Therefore, when the Attorney-General has taken proceedings upon an information under art. 997 of the Code of Procedure against a corporation in the public interest for a violation of law, he is sole dominus litis, and has the same right to control the conduct and settlement of the suit as if there had been no relator, and may discontinue the suit without the leave of the court, and a mandamus will not lie at the instance of the relator to compel him to proceed. A new AttorneyGeneral cannot retract a discontinuance entered by his predecessor in office. The words in art. 997 of the Code of Procedure which empower the Attorney-General to take action whenever corporation "exercises any power, franchise, or privilege which does not belong to it or is not conferred upon it by law," are not to be taken to include every act which can be shown to be contrary to law, but only such acts as are done in the assertion of some special power, franchise, or privilege. The General Railway Act by sect. 12 gives the local authority an absolute discretion to sanction the construction of a permanent line of railway along a public road. (Casgrain v. Atlantic and North-West Railway Company.)

a

Ecclesiastical law-Erection of a new parish Decree of Archbishop - Validity - Jurisdiction of court-Debt of parish-Revised Statutes of Quebec, art. 3380.-Where the ecclesiastical authority has made a decree, in accordance with the provisions of the Revised Statutes of Quebec relating to religious matters, for the erection of a new parish, which decree is admitted to be good and valid for all ecclesiastical purposes, the court has no power to inquire into the regularity of the proceedings by which the authorities were put in motion; and a decree for the canonical erection of a new parish which is valid according to ecclesiastical law is a sufficient foundation for proceedings to obtain civil recognition of such new parish. Proceedings before the commissioners of a diocese, in accordance with the statutory provisions, with a view to the civil recognition of a new parish, are not subject to review in a court of justice. A debt of the Fabrique" is nct a debt of the parish within sect. 3380 of the Revised Statutes so as to prevent the division of the parish till it is paid. (Alexandre and others v. Brassard and others.) Manitoba, Law of-British North America Act 1867 -Manitoba Act 1870-Manitoba Public Schools Acts 1890-Denominational schools-Schools prejudicially affected-Appeal to Governor-General in Gouncil.-Sect. 22 of the Manitoba Act 1870 is intended to be a substitute for sect. 93 of the British North America Act 1867 (30 Vict. c. 3, Imperial) so far as regards the province of Manitoba. Sub-sect. 2 of sect. 22 of the Manitoba Act 1670 extends to rights and privileges of the minority in relation to education, acquired by legislation in the province after the union with Canada, but is not to be construed as giving to parties aggrieved an appeal to the GovernorGeneral in Council concurrently with the right to resort to the courts of law. An appeal lies to the Governor-General in Council under the sub-section on the ground that the Public Schools Acts of 1890 (53 Vict. c. 37, and c. 38) prejudicially affected

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the rights and privileges of the Roman Catholic minority in relation to education by substituting a system of undenominational schools supported out of public funds, for the previously existing denominational schools. (Brophy and others v. The Attorney-General of Manitoba.) New South Wales, Law of-Companies Act 1874Arbitration Act 1892.-Where the court or a judge orders the issues in an action in which one of the parties is a limited company to be referred to an arbitrator, under sect. 12 of the Arbitration Act 1892, it is not necessary for the arbitrator, before entering on the reference, to make a declaration before a justice as required by sect. 113 of the Companies Act 1874, as that section refers only to a voluntary submission under the Act, not to a reference by order of the court. (Zelma Gold Mining Company v Hoskins.)

Crown Lands Alienation Act 1861 (25 Vict. No. 1)-Crown Lands Act 1884 (48 Vict. No. 18) -Conditional purchase-Reservation of "rights accrued." A conditional purchase of Crown lands by a holder in fee simple of adjoining lands, under sect. 22 of the Crown Lands Alienation Act 1861, does not make such purchaser the holder of an original conditional purchase within the meaning of sect. 42 of the Crown Lands Act 1884, and entitle him to make additional conditional purchases of adjoining Crown lands under that section. Where a statute repeals a previous statute with a reservation of "all rights accrued" under such repealed statute, the mere right existing in any person to take advantage of the repealed enactment without any act done towards availing himself of that right cannot be deemed a "right accrued" within the meaning of the reservation. (Abbott v. The Minister for Lands.)

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Municipal corporation - Liability for nonrepair of highway-" Rights and liabilities." -Where a statute relating to a municipal corporation repealed previous statutes, and provided that, "all rights and liabilities existing at the commencement of this Act shall be and continue to be as binding on and enforceable in favour of the " corporation as if this Act had not been passed:" Held, that these words could not be taken to include all the powers and duties possessed by or imposed on the corporation by the repealed statutes. Where a statute vested all public ways in a city in the corporation, and gave the corporation" full power to alter, widen, level, divert, extend, construct, improve, maintain, repair, and order such public ways:' Held, that no action would lie against the corporation for not repairing such ways. (Municipal Council of Sydney v. Bourke.)

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Victoria, Law of-Land tax-Liability-Vendor and purchaser Outgoings-Conditions of sale.-By the law of Victoria land tax is only payable upon landed estates above a certain area. The appelants, who were owners of a large landed estate, sold a portion to the respondent. The portion so sold was less than the quantity liable to land tax. By the conditions of sale "all rates and other outgoings were to be "adjusted as usual." Held that the respondent was not liable to repay a proportionate amount of the land tax in respect of the land purchased by him, it not being an outgoing which would enure to his benefit when he became owner, but one the liability to which would then determine. (County Estates Company r. Graves.)

COMPANY.

Debentures-"Floating security"-Execution creditors-Sale-Money not handed over-Priority.— The sheriff, having seized on behalf of execution creditors goods of a limited company, was proceeding to sell the same, when the plaintiffs, who held debentures of the company, charging all its property as a floating security, paid out the execution under protest, giving the sheriff's officer notice not to part with the money. Held, that, as the money had not been handed over, the d

32

402

605

31

same

equity of the debenture-holders was not displayed. The money was therefore ordered to be paid to a receiver who had been appointed in an action by the debenture-holders against the company. (Taunton v. Sheriff of Warwickshire.) ...page 460, 713 Debentures Floating security When attached.-Where the debentures issued by a company are constituted a floating security over the property of the company, subject to a condition that the company shall be at liberty to deal with its property until (inter alia) default shall be made in payment of any interest thereby secured for the period of three calendar months after the same shall have become due, in order that the floating security may attach, the debenture-holders are under the necessity of applying for a receiver at the expiration of that term. (The Governments Stock Investment and other Securities Company Limited v. The Manila Railway Company.)

886

Beneficial occupation-Licence in nature of lease-Costs of realisation-Costs of preservation -Receiver authorised to "raise money Advances to receiver by debenture-holders Priority. (Lathom v.Greenwich Ferry Company.) 790 Receivers and managers-Moneys authorised to be raised-Costs, charges, and expenses — Priority. Where persons have lent money for the purpose of enabling the receivers and managers appointed in a debenture - holders' action against a company to carry on the business of the company, they are entitled to have priority in respect of the money so lent, over the claims of the debenture-holders, but not of the receivers and managers, for their costs, charges, and expenses properly incurred, unless the lenders are in the position of strangers to the litigation. (Strapp v. Bull, Sons, and Co. Limited.)

Short cause-Sale-Minutes of order-Declaration of charge-Consent of debenture-holder not a party-An action was brought by the holder of the only first mortgage debenture issued by a company on behalf of himself and all other debentureholders, claiming a sale of the colliery belonging to the company; the defendants being the company and the owner of all the second mortgage debentures except some to a small amount which, after the commencement of the action, were found to be held by a person not a party. The action was set down as a short cause, and the plaintiff now moved for judgment according to proposed minutes, which contained a declaration that the plaintiff was entitled to a charge upon the undertaking, uncalled capital, and assets of the company, and an order for immediate sale of the colliery. The company consenting: Held, that the declaration should be inserted in the order according to the usual practice in the Chancery Division; but that, as the plaintiff was the holder of the only first mortgage debenture, he could not sue on behalf of the other debenture-holders so as to bring the case within rule 1b of Order LI., and the order asked for could not be made without the consent of the debenture-holder who was not a party to the action. (Parkinson v. Wainwright and Co. Limited and Wainwright.) ...

Mortgage debenture-Floating security-ChargePriority-Notice-Garnishee order.-Debentures whereby a charge in the nature of what is called a floating security over all a company's property is given to the debenture-holders, allow the company to deal with its assets in the ordinary course of business until the company is wonnd-up, or stops business, or a receiver is appointed at the instance of the debenture-holders; or, in other words, such debentures constitute a charge, but give a licence to the company to carry on its business. So long as the debentures remain a mere floating security, that is to say, so long as the licence to the company to carry on its business has not been terminated, the property of the company may be dealt with in the ordinary course of business as if the debentures had not been given, and any such dealing with a particular property will be binding on the debenture-holders, provided that

514

485

the dealing be completed before the debentures cease to be merely a floating security. The holder of a debenture which constitutes only a floating security as long as the company continues to carry on its business, and no steps have been taken to wind it up or to get a receiver appointed, cannot single out a particular debt due to the company, and give notice requiring that debt to be paid to him, or not to be paid to the company, or to persons validly claiming under the company, and under such circumstances where a garnishee order has been obtained against the debtor, the garnishee may safely pay his debt to the judgment creditor without reference to the notice. The word charge" in a debenture providing that the company shall not be at liberty to create any mortgage or charge upon any property in priority to the debenture will be construed strictly, and accordingly garnishee proceedings (which are only a form of execution) do not lead to any "charge" in the true sense being created on the debt garnished. (Robson v. Smith.) ...page 559 Payment of dividend-Profits-Excess of income over expenditure - Depreciation of capital Liability to make good-" Fixed " and "floating capital-Leases-Goodwill -Where the value of the assets of a solvent company has fallen below the nominal amount of the share capital, the company, in the absence of any special provisions in its articles or of a contract binding the company, is under no obligation to make good such depreciation in the value of the assets, before declaring a dividend out of the profits. Depreciation in the value of the leases and goodwill of a company is a loss of "fixed" as distinguished from "floating" capital. The balance-sheet of a company cannot, therefore, be impeached on the ground that it does not charge anything against revenue in respect of depreciation of goodwill. (Wilmer v. MeÑamara and Co. Limited.) Power to charge uncalled-up capital-Companies Act 1862-Companies Act 1874 of New South Wales (37 Vict., No. 19).-A company limited by shares under the Companies Act 1874 of New South Wales, which is identical with the English Companies Act 1862, has power to create a valid charge upon its uncalled-up capital, so as to confer priority in a winding-up, if such charge is not prohibited by the memorandum or articles of association. (Newton and another v. Debentureholders and Liquidators of the Anglo-Australian Investment, Finance, and Land Co. Limited.)

WINDING-UP.

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305

Banking company Misfeasance Auditors Whether officers - Dividends Payment ofBalance-sheet Profits. Although it cannot be laid down as a general rule that the auditors of every joint-stock company are to be regarded as officers thereof, yet, in the case of a joint-stock banking company, the auditors must be taken to be officers because of sect. 7 of the Companies Act 1879, and as such they come within sect. 10 of the Companies (Winding-up) Act 1890, and may be rendered liable to make compensation in respect of a misfeasance or breach of trust. (Re The London and General Bank Limited.) 227, 611 Compulsory order-Previous voluntary liquidation -Petition founded on debt payable under agreement with voluntary liquidators.-Where a voluntary liquidator of a company enters into an agreement, a debt arising thereunder, although not provable in the voluntary liquidation, will be sufficient to support a petition subsequently presented for a compulsory order to wind-up. (Re The Bank of South Australia) Contributory-Issue of fully paid shares-Registered contract-Consideration.-Sect. 25 of the Companies Act 1867, as interpreted by Re Eddystone Marine Insurance Company (68 L. T. Rep. 408; (1893) 2 Ch. 9) and Re Almado and Tirito Com pany (59 L. T. Rep. 159; 38 Ch. Div. 415) regulates merely the mode of payment for shares. It permits payment to be made by a registered

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contract in the shape of something else than cash. But that something else must be the equivalent of cash. The shares must be really paid for, and if the registered contract makes it manifest on the face of it, that the consideration given under the contract is less than the nominal cash value the allottee will not be relieved from paying up the balance. But the court will not take each contract into consideration and decide whether the price given for the shares is fair and reasonable or whether what is given has a cash value in the market equivalent to their nominal amount. unless there is evidence to impeach the value of the consideration as stated in the contract. (Re Theatrical Trust Limited; Chapman's case : Brandon's case; Greville's case.) Lease-Claim by lessor-Fature rent-Basis of proof.-Where at the date of the winding-up of a company the company is the lessee of premises for an unexpired term of years, the lessor is entitled to prove in the winding-up for the amount of the rent then due, and to enter a claim for the full amount of the rent which will become due under the lease. (Re New Oriental Bank Corporation Limited; Ex parte Hong Kong Land Investment and Agency Company Limited.) 419 Misapplication of assets-Gifts to director-Liability to refund.-Directors have no right to be paid for their services, and cannot pay themselves or each other, or make presents to themselves, out of the company's assets, unless authorised so to do by the instrument which regulates the company or by the shareholders at a properly convened meeting. A company was formed consisting of N., his five brothers, his six sons (all of whom are infants), and two other persons. The directors were N., four of his brothers, and one other person. Only 2500 shares were issued, and they were issued to N. as fully paid up, and he distributed 1831 of them among the other persons composing the company. The company desired to purchase a building agreement, but, as the owners of the land would not enter into an agreement with the company, N. entered into the agreement with them and then assigned the benefit of it to the company, receiving 10,000l. more from the company than he had paid for it. Of this sum 70007. was paid by N. for commissions, &c., in order to obtain the agreement, and he retained 3000l. N. applied the assets of the company to the amount of 3500l. in decorating his own house, and the directors afterwards passed a resolution that he should not be charged with this sum, and it was written off. These sums were paid out of money borrowed by the company for the purposes of its business. All the directors and shareholders knew and sanctioned what was done; but in neither case was there any formal meeting of the company at which the gifts to N. were authorised; nor did the articles give the directors power to make presents to themselves. The company having been ordered to be wound-up: Held, that N. was liable to account for the 3000l. and the 35001., as they were presents to him out of the money borrowed by the company for the purposes of its business; that the gifts were a breach of trust by the whole of the directors; and even if they could have been sanctioned by all the shareholders, that could only be done at a properly convened general meeting, and there had been no such meeting. Held also, that N. was not liable to account for the 7000., the expenditure of that sum having been necessary for the acquisition of the building agreement and authorised by the directors. (Re George Newman and Co.) Practice Debenture-holders' action-Declaration of charge Action commenced after winding-up order.-In Dec. 1894 a company was ordered to be wound up. In Jan. 1895 an action was brought

by a debenture-holder on behalf of himself and all other debenture-holders to enforce his security. By his statement of claim the plaintiff claimed (inter alia) a declaration that he and the other debenture-holders were entitled to a charge upon the undertaking of the company, and upon all its

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