The Sun.
London, England, 1846-04-23 00:00:00

APR IL 239 1846.
9

(pities without exercising all the functions delegated to Sub--
Committees. In fact it was found impossible to., make suches.
selection. All the commercial men • and otaers who
have given their attention to the subject were unab'et
to make any practical suggestions that the Hoene could
safely adopt. There wire four , distinct classes wish whom
they would have to deal. The first class was the provisional
committee, or directors, or tke governing body. 2.the second
class was the original eubscribers who had aTtiliscribed the
deed, bat had ceased .to possess an inttepatn the project.
The third class was the holsters of scrip ; and the
fourth class those eh° had given credit to the company,
and who were creeitors in many- :caps to a large amount.
They now saw the state in which-. they were situated. It was
better that a plan should be 'submitted which weuld allow
Parliament.to select the best scheme, aod this Bill would have
that effect. As he said before, the promotes of many of those
Bills were placed in great difficulty, for there was now no means
of dissolving these schemes without the sanction of the original
shareholders, many of whom had parted with their scrip. If
there were no means of dissolving those schemes, what would.
be the consequence of companies dissolving themselves? I'
there was a company—and he was sure a great majority of alien
was se— in which the great majority of the directors were hnnest,
and a great majority of the shareholders were honest, where they
would be willing to dissolve, they were under this d fficulty,
but they were not legally able to do so, for they were bound
by their contract deed to carry out such works. They could
not dissolve, they must proceed with the object of those deeds
or they might be proceeded against by action in Chancery.
they being bound by the various covenants into which they had
entered. He could state on his own knewleege, there were
many companies who were willing to give up, but for being
so bound ; and they were thus compelled to go into
committee and incur great expense by employ-
ing engineers and witnesses in the inquiry.
During the prevalence of the wild mania of speculation , com-
panies, which were supposed to have immense sums of money,
were projec'ed, the uhtortunate speculators in which, by veil:
tartng to purchase shares, and by paying the deposes, rendered
themselves liable for the expenses, and if the Bills should pass
into) law to subsequent calls hereafter, and possibly to the full
amount of the company, or that portion of it for
which they had subscribed their names. In some
150,000'., and one company, he knew 200,000/. were paid in
to the Accountant-General, and there was locked up not I
only from general circulation, but beyond the reach, as the
law now stood. of those suitor unate persons who had subscribed
it, who had no power to abolish the company, so that their
money was far ever away from their hands, and was subject
ti the Act of Parliament being obtined. Bets it was
evident that three out of four of the Bills before
Parliament could not, on any reasonable foundation, hope to
receive the sanction of Parliament. Even if they were well
advised to stop they were unable to do so, or to
obtain their money from the Aeccountant-General,
and in the meantime the Provisional Directors, who
alone had any control over the fund so deposited,
were obliged to continue their exertions in the chance of ob-
taining the Bill. Then, again, it was not the rejection of the
Bill tl.at would enable the company to dissolve itself and ob-
twn the money from the Accountant General for
distribution amongst the shareholders. The Bill might
be rejected, and although introduced into successive
Parliaments might not stand the slightest chance of success,
but vet in the face of all this the promoters must go on with
the project in the endeavour to get the Bill in a future session.
Still the money was locked up—expenses increased, and there
vas no m, ans of putting an end to them. The law, as his
Hon. Friend stated, gave them no power to disso've.
In existing state of things the would have managing com-
mittee-men bringing actions against allottees and subscribers,
and allottees and subscribers against committee-men; but in
the present state of the law it was impossible to say whether
these actions would be muintainable or not. There could
be no doubt, however, that these parties would go on bringing
actions against each other, the one relying upon the decision of
Wilmer and Tobin, which he contended was no decision at all,
for the learned judge pronounced no opinion upon it, and what
he aid say was incorreeted reported in the newspapers and
the consequence was that upon die faith of the verdict in the
case, 300 actions .were commenced by three companies alone,
and the other relying upon the decision of W. alstead and Spot-
tiswode. Thus speculation having
ended in railway shares
the parties commenced speculating in actions at law;
and realty in his opinion there would be no end to
the litigation and mischief. That all these evils cou dbe re-
moved by Legislative measures it was in vain to
hope, bet he ventured to entertain a strong expec-
tation that if parliament hereafter adopted the Bill
which would be submitted to them by Government,
and in the meantime the present resolutions, the evils them-
selves might not indeed altogether be abolished, but they
would at all events receive a most salutary check.—'( Hear,
hear.) Now, what would this Bid be without Ong into the
details, he might in a few words possess the House of the sub.
stantial parts of the Bill. In the fist place power would be
given to the holders of some small number of shares between
the time of signing the subscription deed, and then obtaining
of the Act of Parliament through the zusnag.eg
c ommiriee, to call a meeting of shareholders to con-
sider the proprietory of proceeding with the undertaking.
It was pi opnsed, that when the meting shou'd Ir cunvuneci
teat proper machinery should be provided for taking by proxy,
or 1 ersonally, the votes of the sharthelders, and if they so
choose they might came to the resolution to dissolve the com-
pany at once, the number required to vote for that resolution
being at least three• fifths of the whole. Proper previsions would
also be made to enable trustees and all persons of an official cha-
racter to vote at atoll meetings, and if the required majority came
to a determine:len at once to wind their affairs, their concern
would be brought to a termination in the same 'manner as all
pirtnership c noerns were wound up. The directors would
have rower of possessing themselves of the funds of the com•
pony, which tiley would have to dispose of, in the first place, In
the discharge of all liabilities into vili:eie they had entered 1
and, in the second place, they would have to pay the surplus in
a fair proportion to such as were bona fide holders
of shares in the company ; and he had hopes
that there would he large surpluses in most cases,
because it was impossible that the large funds which the law
had r. quired to be deposited before any railway Bill passed the
sanding orders of either Houses of Parliament. The pro-
posal of the Right Han. Baronet would create no new liabili-
ties, it would only give relief to such as were desirous to re-
lieve themselves from the engagements which they had enter eel
into in a time of great excitement.— ( Hear, hear. )
The present proposal would Involve no new difficulties ;
its only object was to prevent this waste and useless ex•
penditure of the money of the public in foolish undertakings.
It was obvious that some time must elapse before this lull
could pass, arid what was to be done with the three or four
hundred railway Bills now before Parliament, during the few
weeks that must elapse before this Bill could pass into a law.
To let these Bills go on without any check, would be allowing
the evil to ge on at this period of time when it was most
pressing ; but, on the other hand, were they to take the course
suggested by his Hon. Friend. His Hon. Friend suggested
that they should do more than classify these Bills ; he proposed
that they should at once suspend all these Bills from
further progress, until some reasonable time should
elapse for the passing of this Bill.—(Hear, hear.)
It would be better to allow these rat etings to be called at once,
and the Bills to be stopped. In the first place, before the
petitions can be framed, it was necessary to have recourse to
serious operations, which were certainly attended with some
difficulty. Most extensive interests were involved
its many of these schemes, and the proprietors,
in some cases, would be compelled to relinquish
their projects without having had any opportunity of express-
ing their assent or dissent. It would, perhaps, be advisable
to postpone the consideration of some of these Bills to a
future period, when sufficient time might be had for the pros
prietors to decide on the course most prudent to be pursued. It
was proposed by these resolutions, in case the company
intended to be incorporated, that such meeting
was constituted of persona producing scrip of this
company representing one-third part of the capital proposed to
be raited under this Bill, and it would appear, unless one-fifth
should signify their assent, they would be overborne by the
remaining shareholders. . But then the Hen. Gentleman (Mn,
Bernal asked, would they proceed on the assent of SO small a
numbsr ? To that he would reply that, by these resolutions,
an opportunity would be given to all the scripholders to come
forward to express their sentiments on the subject. lf,
however, four-fifths of them hell back, and only one-
fifth came forward, that circumstance proved that it
was a fit Bill to be entertained. No doubt cases might be
cited where four-fifths of the holders not coming forward
showed an opposition on their part to the Bill, but they would
have again an opportunity of petitiioring against it ; and it was
competent to the Committee afterwards to reject the Bill on
sufficient grounds being shown why they should c :me to such
a decision. The assent of one-fifth went the length
of inducing them to entertain the Bat. When they considered
that these resolutions would operate on every Bill, and that no
Bill in the present rate of public feeling would be entertained
without a compliance with them, he considered that the most
beneficial results would be the consequence. Various objec-
tions were started, and one with regard to persons who had a
right to interfere, but who, by these resolutions,
would not be enabled to do so. It was only
those whit could show that they had really paid
their depo-it, who ought to have a voice in assent or dissent. at
those meetings. It had been said that they ought not to take
away the right of the original shareholders in Noting at
such meetings. He could by no merns agree to
that view of the case. if they hat paid on their shares with
theintention of becoming bona fide shareholders, if they had
taken up their scrip with the view of becoming investors in the
undertaking, they would have stood by the schemes whether
successful or not. The fact of many of the original
shareholders, however, having disposed of their
scrip, they had no interest whatever from the Act of
sale. If the scheme turned out a beneficial one, it was not
the man who had sold his shares who would receive any share
of the profit, notwithstanding he had signed the deed
of the company.—( Hear.) By parting with his scrip
he had forfeited all interest in the undertaking.
He agreed with an Hon. Member, who had spoken this even-
ing, that it would not be safe at the present moment to go
further than to apply the resolutions proposed by his Hon.
Fiiend to the Bills now before Parliament.
Mr. LABOUCHERE said the object of the resolutions was
twofold. First, to pass a Bill to regulate and amend the Bills
under which railway Companies weie constituted, and by
which they were carried on r and, secondly, to discUss
the general question of railway speculation, to
which he should shortly devote his attention.
He hearti:y rejoiced that her Majesty's Government had turned
their atte .tion to a subject of such paramount importance.
Any one who had the slightest attention to what had been
going on during the period of undue speculation must have
seen that the attention of the Government should be directed
and the intervention of the Legislature asked to put an end
to a state of things which were extremely prejudicial
to individuals, and not creditable to the cam.
mercial character of the country. There was only one
point with reference to this subject to which he should venture
to advert ; namely, what the Right Hon. Gentleman had
stated with respect to reserved shares by directors of railways.
He confessed he was rather surprised at the innocence of the
Right Honourable Baronet on the subject, because he
thought the prevalence of the practice was a matter
of notoriety, and, he might add, scandalous none
riety, that this system of reserving shares on the
part of the persons who, from their station and influence, he
thought would have been incapable of such a procetevliseimilliTe
erectiee had been carried to a very greet extent,
effect of coral letely debeiving the great
o were inveigled
Y
et,
doft the public
—toe persons of small property,
Ile h!Treated, that the
in shoals' into these railway projects•
the parties. either allotted to
reserving of these shares,
.which
.eacleivicirequently came off
themselves and their friends, and
g those shorn
scot free themselves,. . thus
them.
they had induced
whether it was possible for
.to join . He did not know
the Legislature to check these
evils, but if the Government would, by the Bill
they were about to introduce, remedy the abusers h. thought