1842.

VIGERS

บ.

PIKE.

Lord

thus improperly exercised, producing great injustice. A man who, with full knowledge of his case, does not complain, but deals with his opponent as if he had no case against him, builds up from day to day a wall of Cottenham. protection for such opponent, which will probably defeat any future attack upon him. I think that the plaintiffs, the company, have not stated or proved such a case as entitles them to repudiate the acts complained of, and to have them rescinded as against Lord Audley or his estate; and that as parties to these transactions, and cognisant of the facts during the time they were acting upon the arrangement now complained of, using and appropriating the property they derived under it, they, as such company, are precluded from asking any relief to which they might otherwise have been entitled. I confine my observations to the part of the relief which prays the rescinding of the transactions, as that to which alone of all that is prayed any question could be made.

A decree declaring that all the share

holders in a

company are

I therefore think that the cross bill must be dismissed, with costs; and, as I have before said, the title to relief under the original bill follows as a matter of course; and I do not find any objection to the form in which the relief is given by the decree.

It was said, indeed, that the decree was erroneous in declaring that the members of the company were bound to pay what might be found due to the plainbound to pay tiff; and Harrison v. Timmins (x) was cited for that what may be found due to purpose. That case only decided that the director sued a plaintiff, was not personally liable for the amount of the judgdoes not make the ment obtained against the company; no objection was shareholders personally made to the form of the judgment: so here the decree declares that the members of the company are bound

liable.

(s) 4 Mee. & Wels. 510.

to pay to the plaintiff; but it does not contain any order against the individuals to pay. I think, therefore, that the ultimate mode of payment is left open, and that there is not in this respect any objection to the form of the decree; and that the appeal must be dismissed, and the decree affirmed, with costs.

Lord Brougham:-I entirely agree with my noble and learned friend in the view that he has taken of this case, and in the reasons he has given for the decision to which he has proposed that your Lordships should come.

1842.

VIGERS

V.

PIKE.

Devon.

The Earl of Devon:-I attended at the hearing of this The Earl of case, which occupied a considerable time; and it therefore became my duty to endeavour to form an opinion upon it. In the greater part of that which has fallen from my noble and learned friend, I certainly concur. I think the cross suit was improperly instituted in the Court below; and that, looking to the pleadings, and the way in which the different parties are mixed up with the transactions, there is not such a case of fraud made out as would have justified any other decree in that suit.

But there is another view of the case, which I have taken, and which I submitted to my noble and learned friends, who, however, differ from me upon it; and I regret to say, in the view which they take of it I am unable entirely to concur. I am perfectly ready, however, to bow with the utmost deference to their superior judgment and experience, and of course also to the advice which they shall give to your Lordships as to the judgment to be pronounced. But I confess, having given much consideration to this case, which occupied many hours in the discussion, I should wish,

1842.

VIGERS

บ.

PIKE.

The Earl of

Devon.

if your Lordships will hear me for a few minutes, to state the view which I take upon one part of the case.

The suit, which is instituted by the plaintiff in Ireland, is a suit in a Court of Equity, calling for an account; but it is in the nature of an action of covenant. It is in fact to have an account taken in the same terms as upon a covenant; and the form on which this is framed is this:-It is desired that an account may be taken of the sum due to the plaintiff on account of the purchase money of the said lease. Then we look to see what the said lease is, and how it is to be performed. The Act of Parliament which has been referred to, is an Act giving power to the company, or rather to the partners, for they are not incorporated quasi a corporation, and allowing them to sue or to be sued in the name of one of the directors. The Act having given that power, very wisely and properly, as I conceive, limits the cases in which parties may be so attacked through one of the members, by providing in a very special manner a clause which points out the terms and the manner and the formalities with which the company shall be allowed to take leases. They are to take leases of mines only after seven days' notice given to all the directors, and in the name of three directors at least. That appears to me to be a very wise limitation. In a company or partnership where there is a very large number of persons, of course those who reside at a distance may not and cannot be cognisant of all the transactions of the directors. They must, to a certain degree, confide in the discretion of those who take the management, and they may be liable, to a considerable extent, for their foolish acts. But, at any rate, this Act of Parliament has protected them against being liable for covenants contained in any lease of mines that may be taken,

unless that lease is taken under circumstances which give them an opportunity of forming an opinion upon it.

1842.

VIGERS

บ.

PIKE.

Devon.

In this case, the lease in question is not made with any of these formalities. The lease is made between The Earl of Lord Audley, and an individual, who afterwards became executor of Lord Audley, and who himself is the plaintiff, seeking by this bill to have the obligations contained in that lease enforced against the shareholders. I do not, however, rely upon that circumstance; because, unless there are circumstances of fraud made out much more clearly than they are made out in this case, that makes no alteration in the view which I conceive ought to be taken of it in point of law.

Lord Audley having entered into the original lease with one individual, does not obtain payment of the whole of the purchase money; and after his death a bill is filed by his executor, the prayer of which is, "that an account may be taken of the sum due to the plaintiff as executor of Lord Audley, on foot of the purchase money of the said lease." And the decree is, that that account shall be taken, and that all the shareholders are liable for the payment of what is due on the account so taken. Undoubtedly I agree with what my noble and learned friend has said, that that would' have no effect to make the shareholders personally liable. If this decree is substantially right, there is no objection whatever to its form. But I cannot for myself think that a Court of Equity ought to give a relief which will only have effect against the whole body of shareholders by the means and force of the Act of Parliament, when the contract upon which the relief is founded has been entered into in a manner that is not in accordance with the provisions of that Act. That

1842.

VIGERS

V.

PIKE.

1843:

April 27.

shortly is the ground upon which I felt unable to concur in the view taken of this case by my noble and learned friends, and have felt it my duty to call your Lordships' attention to it (t).

It was then ordered that the appeal be dismissed, and the decree affirmed, with costs.

(t) See Lord Cottenham's observations on this point, supra, pp. 649, 650.

THE Respondent (Mr. Pike) proceeded, in his suit in Ireland, to take the accounts before the Master, with a view to fix the shareholders personally with the debt, notwithstanding the Lords' expla nation of the effect of their order. The Master having made his report, the Appellant (defendant in that suit) took exceptions; whereupon both parties came to an arrangement, and the following order was made by the Court :

"By consent, let there be no rule on the exceptions, and let the deposit be paid back to the defendant, and let the report of the Master be confirmed. Let the said West Cork Mining Company pay to the plaintiff out of the property of the said company (it not being intended by this decree to charge the members of the said company personally) the sum so found to be due by the said company, together with the costs of this suit, within one month; and declare the said sum and costs to be a lien and charge upon the said deed of 18th February 1834, and the indentures of the 29th and 30th of August 1834, in the pleadings mentioned, and all other property belonging to the said company and by the consent of the defendant, let the Master forthwith set up and sell the lessees' interest in said indentures of the 29th and 30th of August mentioned, and the premises thereby granted and demised, in such manner as he may be of opinion will be most beneficial; with liberty to the parties to apply, &c.-This order not to affect the question of costs under the Lords' order on the appeal."