The Sun.
London, England, 1854-01-31 00:00:00

LAW INTELLIGENCE.--Jan. 30.

COURT OF QUEEN'S BENCH.

THE QUEEN (ON THE PROSECUTION OF THE HON F.
SCOTT AND OTHERS) V. HARRISON.-CRIMINAL INFOR-

MATION AGAINST THE TIMES NEWSPAPER.

This was a rule which had been obtained at the in-
stance of the Hon. F. Scott, the chairman, and nine of
the directors of the South Western Railway Company,
calling on the defendant, the printer and publisher of
the Times newspaper, to show cause why a criminal ins
formation should not be filed against him, for an article
which had appeared in that journal in November last,
iefiecting seriously on the character of the prosecutors.
Of the directors who had joined in the application, two
were out of the country, and two had opposed the other
directors in the matter to which the article adverted.
Sir F. Thesiger now appeared to show cause against
the rule. The learned counsel said that the article in
question related to the proposed extension of a line of
the South Western Railway Company, between Dor-
chtster and Exeter, with regard to the expediency of
vrhich some of the shareholders of the company had
joined with the directors, while others took a differ-
ent view. The article was written, as was stated at its
conclusion, to call the attention of the public and the
shareholders throughout the kingdom to the conduct of
the shareholders of the South Western Company, who had
chosen to throw off the yoke of the directors, and had
insisted upon having a voice in their own affairs. It
was admitted by the Attorney-General in moving for
the rule teat railway directors were in the nature of
public functionaries, and that their public conduct might
be remarked upon in the same way as the conduct of
ministers of state, and even of judges, and he thought
their lordships would see that in this case the article had
not transgressed any proper limits which could be
assigned to the discussion of questions of great public
importance. The South-Western Company had extended
its line from Southampton to Dorchester. This line was
a single one with the exception of the first six miles out
of Southampton. There had been great rivalry between
the South Western and the Great Western Companies,
and the battle of the gauges had been fought upon
various fields. The South Western directors had had
an intimation that the Great Western Company intended
to apply to Parliament for an act to extend their line
across a tract of country which would interfere with a
proposed extension of the South Western line to Exeter.
The South Western directors, therefore, considered
that it would be desirable to exclude their rivals from
this tract of country, and on the 10th of May, in last
ear, a report was circulated to the shareholders,
:.,nd a meeting convened for the 19th of May. It ap-
peared from Mr. Scott's affidavits that the directors, in
their report, proposed that the meeting should con-
sider the propriety of extending the line of the company
from Dorchester, through Axminster, to Bridport and
Exeter. This was said to be a fair candid, and full re-
port, but he had affidavits to show that a statement it
contained, that a profit of 31 per cent. had been realised
from the Southampton and Dorchester line, was not
correct. In consequence of this report, a vast number
of proxies were placed in the hands of the chairman.
Some of these proxies were of a peculiar description,
consisting of " preference shares." The nominal amount
of each of these shares was 161. 13s. 4d. ; the first pay-
ment upon them was to be 1/. 13s. 4d., and the parties
who held them were entitled to 7 per cent. dividend.
The amount of the nominal capital held by the preference
shareholders was divided into as many 501. shares as it
would extend to, and each 50/. was entitled to a vote.
Upwards of 280,000 of these shares voted at the meet-
ing, of which 171,000 were in favour of the direc-
tors. The resolution proposed by the directors was
passed almost unanimously by the meeting, only six
or eight hands being held up against it, but this was
because one of the shareholders explained that opposi-
tion would be useless on account of the number of proxies
held by the chairman. It was resolved that the interests
of the company were concerned in procuring a rejection
of the Great Western bill, and in extending their own
railway to Exeter, and that the directors should be
authorised to pledge the company to apply to Parlia-
ment for powers to construct that line. This line was
a single one, and nothing was said except as to extend-
ing the line as it then existed. Mr. Scott then appeared
before a committee of the House of Commons, before
which the Great Western Bill was pending. Ile (Sir
Thesiger) begged distinctly to state that he was not
imputing the slightest impropriety to Mr. Scott, or
anything that in the slightest degree affected his personal
honour and character; but Mr. Scott, carried away by
his zeal for the company, had constructed the pledge
he was authorised to give too extensively, and
had written a letter to the chairman of the
committee, in which he distinctly pledged him-
self on the part of the company to apply to Parliament
in the ensuing session for a bill for the extension of the
South-Western line, and he also said he had no hesita-
tion in adding that the company would, immediately
such extension line was granted them, proceed to double
tile line between Southampton and Dorchester. No
authority had been given to Mrr Scott to make a pledge
of this formidable character, which, if it had been car-
ried out, must have entailed an expense of at. least
500,0001. on the company. He had affidavits from
three shareholders, who swore that no such authority
NN as intended to be given at the meeting in May. One
-of the objections to the article was that it contained the
expression that if Mr. Scott had given this pledge against
the wishes of his constituents, it was a mere swindle."
That was to say, it was a " swindle" upon the Parlia-
ment. This.was certainly an odious word, but a gentle-
mon in the position of Mr. Scott ought to be perfectly
free from blame before he could ask the interposition
of the court in consequence of that word having been
u ,ed. Nothing dishonourable was imputed to him, but
only that he had failed in his duty as a director. It was
s; id this pledge was subsequently sanctioned at a meet-
ing of the 10th August. A few days previously a report
had been issued setting forth the resolution which had
been passed in May, and proposing that the subject of
the extension line should be again taken into delibera-
tion at another meeting. Many of the shareholders had
no idea, therefore, that any important resolution would
be brought forward at the meeting of the 10th Aug. A
resolution was, however, proposed, sanctioning the pledge
which had been given by the directors, when an
amendment was moved, and carried by a majority of 3,
that the proposed extension line should not be carried
out. It was afterwards announced by Mr. Scott him-
self that if it had not been for a mistake in the reckon-
ing of the votes, the majority would have been much
larger. Thus, when the attention of the court was called
to this pledge to make the double line the proceeding
was not sanctioned by them, and therefore the pledge
must have been against the wishes of the shareholders.
Mr. Scott had acted at least entirely in error, and placed
himself in a situation in which he could not ask for the
interposition of the court.
Lord Campbell asked in what words Mr. Scott said
he had authority to give the pledge ?
Sir F. Thesiger read the letter of Mr. Scott to the
chairman of the committee.

Lord Campbell said he did not pledge himself to the
double line under the authority of the meeting.
Sir F, Thesiger—Yes, my lord.
Lord Campbell—He gives the pledge under the au-
thority of the meeting to introduce the bill, but he does
not give the pledge to make the double line under the
same authority.
Sir F. Thcsiger said it was not contended that he did,
but, that he had still given a pledge which was wholly
unauthorised.

Lord Campbell—lf he bona fide believed that the
shareholders would sanction such a line, I do not see
ho ~v he can be said to have exceeded his authority by the
pledge he gave .
Sir F. Thesiger said if he had not given the pledge
the committee would not have reported against the
Great Western scheme. He was not charged with de-
ceiving the shareholders, but with deceiving, or, to use a
strong expression, with " swindling" the Parliament.
Was this a private question ? or was it a matter con-
nected with the conduct and management of the com-
pany? The article was intended to point out to the pub-
lic the example of the South-Western Company for
imitation. There could be no doubt the improvident
extensions had been the bane and ruin of railway com-
panies, and as the article said, it was a matter of the
greatest public importance that the railway interest
siwuld he kept in a solvent condition. It was a matter
of public moment that directors should be kept in strict
or,:er in the exercise of the large powers with which
they were invested ; and if, in the course of observations
not upon their private and personal character, but
directly affecting their discharge of their public duties,
some strong expressions were used, they must not be too
nice and critical in examining those expressions. Di-
rectors of railway companies were clearly amenable to
the public for derelictions of their duty, by which im-
portant interests, which were confided to them, were
materially prejudiced.
Sir F. Kelly followed upon the same side. He con-
tended that Mr. Scott and the directors were not en-
titled to a criminal information, because they had
clearly not shown that they were entirely blameless in
the transactions upon which the article commented.
These extension lines were well known to be profitable
in very few instances, and, therefore, no directors had
a right to pledge the shareholders to the construction of
any extension line without having the clear unbiassed
assent of a majority of the shareholders.
Lord Campbell said that the complaint was that a
specific charge bad been made of tampering with votes,
and making use of fictitious votes.
Sir F. Kelly denied that any such charge bad been
mace. It Was put hypothetically. But he did not I
hesitate to say, disclaiming an imputation against the
per onal honour or character of the directors, that they
had practised a deception or a " swindle" on the com-
mittee of the House of Commons. The article did not
eveninsinuate a charge of tampering with votes, but
merely reasoned upon the case, as stated on the one
side by the directors, and on the other side by the
shareholders.

Lord Campbell said the learned counsel would find
several precedents of libels by means of insinuations and
inuendoes.

Sir F. Kelly said no such insinuation was intended
to be cast on the directors by this article. If their lord-
ships found that the complainants were far from blame-
less upon either of the points adverted to in the article,
they could not now come forward and ask for the pro-
tection of this court by means of a criminal information.
Mr. Cowling was on the same side.
The Attorney-General, who, with Mr. Bovill, appeared
to show cause against the rule, said he admitted that the
conduct of railway directors was a fit and proper subject
for discussion in the columns of a public journal. If
the parties deserved censure, and had been censured in
the manner they deserved, they had no right to complain ;
and if this article had only questioned the policy of the
courie they had pursued, or imputed an error in judg-
ment, it never would have occurred to them to make
the application. But they complained that evil motives
were ascribed to them ; and they were charged, in lan-