the company has obtained its act, and which we have seen is not rendered illegal as regards railway companies, by the 7 & 8 Vict. c. 110, s. 26.

Now where the subscriber has sold his scrip before incorporation, the company may refuse to register the scripholder. The

case of the Kidwelly Canal Company v. Raby, 2 Price, 93, [275]

seems to decide this point. There the act passed in June, 1812, and the subscribers' names were inserted, except the defendant's, but his name was omitted in consequence of his expressed wish, before the act was obtained, that his subscription should be withdrawn; but he was held bound to pay the calls, and it was ruled that he could not withdraw or escape from his liabilities as a shareholder without the formal consent of all the others.

Persons thus bound cannot discharge themselves by what, though a legal sale, is still an unauthorized transfer to some person between whom and the company and the trustees, there is no privity of contract. The directors may therefore refuse to register any but the subscriber, and they have a right to compel him to come in and register; for the transfer clause which regulates how shares shall be transferred after the act is obtained, enacts that "until such transfer has been so delivered as aforesaid, the vendor of the share shall continue liable to the company for any calls," &c. Thus even upon a transfer after the act, unless it be duly certified, the original subscriber is liable; à fortiori is he liable when the transfer takes place before the act is passed.

The premature transfer of scrip is a barren contract. The vendor seldom undertakes that the vendee shall be registered, and unless he does, the latter has no remedy in the event of a refusal by the company to accept him, as in Deeman v. Lloyd, 14 Law Jour. Q. B. 165, where there was an express undertaking by the vendor. On the other hand the scripholder, it is submitted, cannot be compelled to register himself, for in the first place, he has contracted no liability to the company, and may, if he pleases, forego his claim, which in some cases it may be his interest to do. In this case the covenant between the company and the original subscriber must hold good, and the latter will be held bound to fulfil it, and pay the calls, whether he is registered or not, according to the requirements of the 8 Vict. c. 16, s. 21. "That the several persons who have subscribed any money towards the undertaking, or their legal representatives respectively, shall *pay the sums respectively subscribed, or such portions thereof as shall from time to time be called for [276] by the company, at such times and places as shall be appointed by

the company." Neither, in the second place, does the scripholding vendee usually undertake to indemnify the vendor.

In equity, an attempt was frustrated to obtain indemnity in a similar (Jackson v. Cocker, 4 Beavan, 59.) The Master of the Rolls observed, "This is called a purchase of shares, when it is a purchase of mere certificates, and the question is, whether there is a contract on the part of the defendant to become a proprietor at all events? I cannot find it expressed, and I cannot raise it by implication of law." In Humble v. Langston, 7 M. & W. 517, this case is distinguished from that of an original lessee compelled to pay damages incurred by a breach of covenant by the assignee of the lease. But if the company choose to register the scripholder, and he choose to be registered, and if he be, there is express authority, not only that he becomes liable, quâ shareholder, for calls, &c., but that the original subscriber is discharged from such claims arising subsequently to the registration of the transfer, in the above cited case of the London Grand Junction Railway Company v. Freeman. The court having referred to the general and well-known usages with respect to these transfers, said, "Taking all these things into consideration, the court cannot doubt that all are made liable to pay calls, who, having before the passing of the act become entitled by the then well-understood method of transfer, were afterwards registered as shareholders."

Even if the company refuse to register a mere scripholder, the subscriber can register himself and transfer to the scripholder, and thus defeat the refusal.

The various liabilities are provided for in the 8 Vict. c. 16; the 8th section of which makes every one a shareholder who has subscribed the required sum, "or shall otherwise have become entitled to a share in the company," and who has been registered. The 11th section of the same statute entitles the holder to a share in the certificate, which is evidence of his proprietorship. By section 14, the

[*277] *shareholder may transfer all his interest in the capital stock and his "shares" to the transferee, who thereupon de facto becomes the "shareholder." The 15th section, as we have seen, enacts that until a transfer has been so delivered as required by the act, the vendor is liable. The conclusion is, therefore, that after it, he ceases to be liable for calls; and section 23 makes the shareholder liable to pay the calls, and against shareholders, section 25 limits the remedy in default of payment. "If, at the time appointed by the company for the payment of any call, any shareholder fail to pay the amount of such call, it shall be lawful for the company to sue such shareholder for the amount thereof."

The 26th section of the Joint Stock Company's Act, prevents any doubt as to the liabilities of sale of scrip in such companies, for it enacts that "with regard to subscribers, and every person entitled, or claiming to be entitled, to any share in any joint stock company, the formation of which shall be commenced after the 1st day of November, 1844, that until such joint stock company shall have obtained a certificate of complete registration, and until any such subscriber or erson shall have been duly registered as a shareholder in the said stry office, it shall not be lawful for such person to dispose, by e or mortgage, of such share, or of any interest therein, and that every contract for, or sale or disposal of such share or interest shall be void, and that every person entering into such contract shall forfeit a sum not exceeding 107.

The transfer of shares after complete registration, is thus provided for by section 54: "It shall be lawful for every shareholder of such company, and he is hereby entitled, to sell and transfer his shares. therein by deed duly stamped, in which the full amount of the pecuniary consideration for such sale shall be truly expressed, and which instrument of transfer must be according to the form in the schedule (K) to this act annexed, or to the like effect; and the directors of the company shall cause a memorial of such instrument of transfer, when produced at the office of the company, to be entered in a book to be called 'The Register of Transfers,' and the entry thereof *to be endorsed on the instrument of transfer." All calls are to be paid previous to transfer, and subsequently the transferee is alone liable.

[*278]

The 9 & 10 Vict. c. 28, facilitates the dissolution of railway companies, but dissolution is not to affect the rights of creditors (s. 25), or the settlement of liabilities.

The original liability of the shareholder to creditors and third parties, for all contracts made up to the time of the registered transfer of his interest, clearly remains. It is governed entirely by the same law as that of retiring partners, which has been already fully explained. Wherever any original shareholder has reason to believe that any credit has been given to the company on his account, or by parties who have a particular knowledge of his connexion with the company, it will be prudent to give such parties express notice of its termination.

This brief outline of the law of public companies, as far as it affects contracts by and with them, will be found to embrace the general principles of the law applied to cases most likely to arise, and of which the solution promises to be of practical or frequent use.

PRINCIPAL AND AGENT- -THEIR RESPECTIVE LIABILITIES AGENCY OF WIVES FOR THEIR HUSBANDS

- RECAPITULA

TIONS REMEDIES BY ACTION-STATUTES OF LIMITATION.

PURSUING the consideration of the points arising upon contracts made through the medium of agents, and having disposed of those which relate to the liability of the principal upon them, the next in order is that which regards his power to take advantage of them. Now, where the agent, when he makes the contract, states who his principal is, and states that he is contracting on the behalf of that principal, or where (though there may be no express statement to that effect) the circumstances of the transaction can be shown to have been so completely within the knowledge of the parties to it that there can be no doubt that it was understood at the time that the person who actually made the contract made it as an agent, and intended to make it on behalf of his principal, in such cases there can of course be no doubt of the principal's right to take advantage of it, and enforce it to the fullest extent. It is, in truth, as if he had put his own hand to it. In such cases, therefore, there can [*280] *be no difficulty. But the cases in which difficulties arise, are those in which the agent, being really only the substitute for another, nevertheless contracts in his own name as if he were himself the principal.

Now, in such a case, the principal may adopt and enforce the contract, but his right to do so is subject to a qualification which has been dictated by common sense and public convenience, namely, that, on declar

ing himself, he stands in the place of the agent who made it, so that the other contracting party enjoys the same rights against him which he would have enjoyed against the agent who made it, had that agent really been the principal. For instance, if I buy a parcel of goods from A., who sells them to me in his own name, though he is really only the factor of B., whose property the goods really are, B. may, if he think proper, declare himself the principal, and require me to pay the price to him, but if the factor owed me money which I could have set off against the price had the factor sued me for it, I have the right of setting it off against B. in like manner, as I might have done against the factor. And the good sense and justice of this is obvious; for it may be exceedingly inconvenient, indeed ruinous to me, to pay in hard cash; and my knowledge that I should have this set-off may have been my only inducement to buy, and if I were deprived of it, I should be led into a trap-induced *to purchase upon one ground, and forced to pay upon a different one.

[*281]

1 George v. Clagget, 7 Term, 359; Purchell v. Salter, 1 Queen's Bench, 197, 41 E. C. L. R.; Sims v. Bond, 5 Barn. & Ald, 393, 27 E. C. L. R.; Lime Rock Bank v. Plimpton, 17 Pick. 159; Leeds v. Marine Ins. Co. 6 Wheaton, 570; Violett v. Powell, 10 B. Monroe, 347; Parker v. Donaldson, 2 Watts & Serg. 21.

As the lecturer has elsewhere expressed it, "in every case in which the agent sues in his own name, two consequences, it must be remembered, follow: 1. That the defendant may avail himself of those defences which would be good as against the agent who is the plaintiff on the record; Gibson v. Winter, 5 B. & Ad. 96; Wilkinson v. Lindo, 8 Mees. & Wels. 83; Bauerman v. Radenius. 2. That he may avail himself of those which would be good as against the principal, for whose use the action is brought; Welstead v. Levy, 1 Mood. & Rob. 138; Megginson v. Harper, 4 Tyr. 94; Rex v. Hardwicke, 11 East. 578; Harrison v. Vallance, 1 Bing. 45; Smith v. Lyon, 3 Campb. 465." Note to Thompson v. Davenport, 2 Smith's Leading Cases, 317.