The Express.
London, England, 1858-03-19 00:00:00

TEE EXPRESS. FRIDAY EVENING, MARCH 19, 1858.

tab) inulligtnct.
EQUITY COURTS.—MARCH 18.
(Before Vice-Chancellor ilinderney.)
TRH XL/LC*IO2MA TOWPISIVIND V. TEI EARL OP

This suit wan Instituted for the porpoee of settling a ques-
tion whether certain property bequeathed to the plaintiff by
Lord Dudley Stuart fell within the scope of a covenant in
bar marriage settlement. By the covenant in the settlement
In question it wee " provided, declared, and agreed between
sad by' the parties thereto, and the said John Marquis Town -
Am; for himself, &c., did thereby covenant, promise, and
grsat, ' with the trustees, that in case the marriage should
take effect, and the plaintiff, "or the said Marquis Townshend
fa hew right, should become possessed of, or interested in, or
entitled to, any personal estate, moneys, effects, or other pro-
in possession, reversion, remainder, or expectancy,"
thbfe Mw means whatsoever, the said Marquis Townshend and
plaintiff should, within six calendar months after Lady
Townshend became so entitled,t master the estate to the trustees
of the settlement. By the will of Lord Dudley Stuart, dated
In 1863, a sum of 6,0001. was directed to be held by his true-
tees upon ouch trusts as Lady Townshend should appoint,
and in default of appointment, upon trust for her for life for
her separate use, with remainder in trust for his exeeatore or
administrators. It was thia sum of 6,0001. which wait in dis-
pute, it being contended on the one hand that it fell within
the covenant in the settlement, and on the other that it did
not'

Belly, Mr. Leach, Mr. Stratton, Mr. Giffard, Mr.
alts, and Mr. F. Bacon represented the different parties.
The Vice-Chancellor said that the bequest under the will
of Lord Dudley Stuart really constituted three distinct gift.
There wort the gift of the power of appointment, the gift in
default to the plaintiff for life, and the gift to the plaintiff of
the ultimate reversion in case she died without ince. In his
Honour's opinion the covenant to settle failed to touch either
the power or the life estate ; but he came to the conclusion
that it operated on the revessionaryinterest, and there would,
therefore, ba a declaration accordingly.

(Before Vi

Si, W. P. Wood.)

THE ATIIEN.F.UNt INSURANCE COMPANY.-TN RE A. BAILEY

RICHMOND—WINDING-UP ACT—CONTRIBUTORY.
This was a motion by way of appeal from the decision of
the chief clerk, whereby Mr. Alexander Bailey Richmond
had been placed on the list of contributories to respect of
2,100 shares. The grounds on which the motion was made
were of a somewhat extraordinary character, and would form
en
instructive chapter in the history of frauds. The com-
pany, which was formed as a proprietary insurance company,
was established in 1851 It would seem it had been intended
that the capital should be large, but it was not clear whether
' a hundred thousand or • million was the sum fixed upon.
The Joint Stock Companies !Act provides that no company
shall be registered until one-fourth of the share capital has
been subscribed for,but only 3,027 one pound shares had been
taken up in this concern. To obviate this difficulty, the deed of
settlement provided that the capital should be 10,0001., and
complete registration was effected on the 14th May, 1856.
The deed, however, contained another provision that at an
extraordinary meeting of shareholders, at which not less
than 50 shareholders should be present, the capital might
be lammed by an amount not exceeding 990,0 M.,
and on the 16th of May, two days after the company had
been completely registered, a minute was made in the share-
holders' book to the effect that at an extraordinary meeting
of shareholders held that day, the Rev. J. Bartlett in the
chair, it was resolved that the capital should be increased to
100,000/. ; that 1,400 shares should be awarded to the pro-
mitten of the undertaking ; and that a vote of thanks be
gtven to the Rev. J. Bartlett for his conduct in the chair.
These minutes, it was stated, were in Mr. Bartlett's writing,
and the fact was that no such meeting ever took plate. The
directors, however, issued shares aa if the resolution had
been legally canted, and 35,000 shares were issued alto-
gether. Mr. Richmond executed the deed in October 1861,
and took a thousand shares, on which he paid 11. s share.
He was elected a director and took his seat. While he was
on the direction he proposed that no more shares should be
famed, and that the directors should take up the remaining
shares and hold them for the company. He alleged that this
was agreed to, and that in pursuance of that arrangement he
signed the deed for 2,000 shares in addition to those be
already held, but the shares were never actually issued, and
he paid nothing on them. He resigned his seat on the direc-
tion in October, 1864, and announced his intention to sell his
thousand shares. The directors flared the effect of throw-
ing a thousand shares at once on the market, and they
requested him not to dispose of his shares, but to accept a
bond of indemnity against risk. This b agreed to do, and
the bond was executed in respect of the thousand shares.
At the latter end of 1856 the company was in difficulties, and
the shareholders appointed a committee of shareholders, of
whom Mr. Richmond was one, and afterwards, the directors
having resigned, they elected the members of the committee
in then places. Mr. Richmond had then transferred his
thousand shares, but in order to qualify himself as a director
he took another 100 shares. In 1866 the company was
brought under the operation of the Winding-up Act, and
some extraordinary disclosures were then made. It appeared
that a Mr. Cox was appointed superintendent of agencies,
and he resisted being placed on the list of contributories. on
the ground that when he signed the deed it contained a
clause limiting the liability of the shareholders to their shares.
Evidence was given before the chief clerk on this matter,
and it was shown that the deed, which was a parchment in
the book form, bad cot the clause in question in it when it
was registered, bat that it had been inserted when Mr. Cox
executed it. and also when Mr. Naylor, a gentleman
residing in Sheffield, and who executed it at the instance of
Mr. Naylor, on the understanding that the liability was
limited. It wee also shown that circulars were issued with
extracts from the deed, including this clause, and that the
skin sentaining the interpolated demo was afterwards re-
moved. It did not appear when It was removed, nor whe-
ther it was removed when Mr. Richmond signed the deed,
but it was contended on his behalf that he ought not to be
held liable in respect of the 2,000 &area inasmuch as be
took those shares only for the benefit of the company, in pur •
seance of the arrangement betweao himself and the other
directors, and that moreover the directors had made a call of
sa. a share, which he had not paid, and in consequence they
had been cancelled, and that both with regard to them and to
the 100 shares he ought not to be held liable, inasmuch es he
knew nothing of the interpolated clause which invalidated the
deed.

The Vice-Chancellor said there was no evidence that the
interpolated clams was in the deed when Mr. Richmond
signed it, nor was that his case, and it would be a startling
doctrine to hold that a shareholder who had signed the origi-
nal deed should be entitled to escape from the circumstance of
others having signed it with an additional clause. Mr. Rich-
mond had been returned to the registration officer as holding
2,000 'harm and he stood before the world in that capacity.
The subsequent cancelling of those shares by the directors he
looked upon as a proceeding of no validity, inasmuch as they
had no power to cancel shares, but the deed went on the
assumption that the forfeiture of the shares would be a pro-
ceeding which would be beaeftcisl to the company. Then
with retard to the increase of capital, though that had been
accomplished by improper means, and, he regretted to say,
through the medium of a clergyman, yet so dividends were
paid on the increased capital, and the shareholders must have
known of it, they must be held to have acquiesced in it. Mr.
Richmond would, therefore, remain on the list, in respect of
2,100 shares.
Mr. Pigott appeared for Mr. Psinter, the executor of a
shareholder, who claimed exemption on the ground that his
testatrix had signed the deed when the interpolated clause
had been removed, and that the interpolation had invalidated
the deed. In this case also his honour decided that the same
should remain on the list.

The Vioe-Chancellor, in the oonrse of the hearing, ob-
served that there was reason to believe this wee not the oily
caao in which the deeds of settlement of joint stock companies
h►d had clauses interpolated, and he had communicated the
facto of this came to the late Attorney-General.

ceedings to abate the nuisance complained of, but they were
not effectual, and it was at length considered necessary to
Institute the present prosecution.
The case was proceeding when the parcel was despatched,
and appeared likely to occupy a very considerable time.