The evening telegraph. [volume] (Philadelphia [Pa.]) 1864-1918, 1866-02-26

stockholder in the consolidated company, but he
exhibited a certificate Of stock showing he was
holder OF twelve shares In the Atlantic and Great
Western Railroad Company, the Pennsylvania
corporation, and the only one / can recognize.
Is was then the ordinary case Of shareholder in
acompany asking the interpretation Of Court
Of Equity, to restrain the commission Of acts
which were ultra uires. thought this was settled
in the case of Sanford vs. Railroad Company, IL
Harris, 37S, where the plaintiff was the holder OF
only ten shares, and was the member OF rival
Express Company, and had purchased the stock
for the purpose of fling the bill. 1t was held
there that the contract made by the Railroad
Company was against law and void, and 1t was
ordered to be cancelled, and delivered up. In
the case of Gratz vs. Pennsylvania Railroad and
Philadelphia and Erie Railroad Companies (5
Wright, 442), the suit was by single share
holder. brought to restrain acts alleged to be
ultra pires.
AS several cases in England have been cited
by Ithe defendants and the question has been
argued at length, shall consider them briefly,
TO see whether we have been In error in Penn
sylvania. In Sparks We. Southwestern Railway
Company Small & Gifferd, 142, Vice.Chancei-
lor Stuart, on the 14th OF January, 1858, held
that the plaintiffs having been aware of the
intention to construct the line and not having
applied with diligence, the court would not
grant the Injunction; and at page 166 he says:-
mo doubt 1t has been held In several cases that
the mere fact that the plaintiffs are shareholders
in rival company is no reason tor the court IN
o proper case refusing its aid 20 prevent the
violation of contracts.
"But where the fact is established that under
the pretense of serving the interests of one Com
pany, the shareholders in rival company by
purchasing shares for the purposes OF litigation
can make this Court the instrument of defeating
or injurlng the Company into which they so in
trude themselves in order TO raise questions and
disputes on matters as to which the other men,
bers of the company may be agreed, | cannot
consider that in such case it is the province of
the Court ordinarily to interfere" This is not
the case before us, taking the language in its
strongest sense.
In Rogers vs.. Oxford etc.. Railway Company,
2 De Gex and Jones, G62, the bill was fled by
clerk of rival company, who had made him q
shareholder with view solely to their own in
terests, and the case was heard and decided on
the merits against him, the act complained of
rot being ultra UireS. Lord Justice Knight
Bruce said :-"But if on the legal point there is
room for doubt, the circumstances do not in my
judgment render it imperative on the Court to
act against the Company"
In Forrest VS.. Manchester, Sheffield and Lin
colnshire Railway Company, 30 Bevan 40 (3Oth
May, 1861, where the plaintiff who held 9S2 of
stock of the Railway Company, had an interest
amounting to f360 in Packet Company, whose
profits were interfered with by the excursion
traffic of the defendant, he was also Director
OF the Packet Company. and the Directors
directed the institution Of Lhe suit and indemni6ed
him against the costs The Master of the Rolls
decided the case on the merits against the
plaintiff.
Upon appeal Lord Chancellor Woodbury. on
the 18th of July, 1861, affirmed the decree Of the
Master of the Rolls q Jurist, N. S., 887) not
upon the ground taken below, but entirely
upon that OF personal exception to the character
of the plaintiff as being the mere puppet Of the
Packet Company, who had directed the institu-
tion of the suit.
In Hare VS.. London and Northwestern Rail-
way Company e johnson & Hemming, sO), Vice
Chancellor Wood, on the llth of June, 1861,
held the agreement complained CT was not ultra
vres, and it was queried whether the plaintiff as
a shareholder in one company had, with full
knowledge, received profits under an agreement
between that company and others, can after
wards, on purchasing shares In one of the other
companies parties TO the agreement sustain q
bill on behalf of all shareholders in such COM
pany impeaching the agreement as ultra ores,
more especially if it appears that he is really
suing in collusion with one of the companies
parties to the agreement
l have stated these cases in detail to show that
the case before the court has no features in com.
mon with them.
In the leading cases of Coleman vs. The East
ern Counties Railway Company, 10 Bevan;
Lord Langdale, on the 18th November, 1916,
where plaintiff filed bill in behalf of him
self and other stockholders in railway Com
pany, to restrain the Directors committing a
breach of trust, and it appeared that he was
suing at the institution of another rival COM
pany, held that this circumstance was not of
itself sufficient to prevent him from obtaining u
special INDUCTION on the merits of the case
In Bagshaw vs.. Eastern Union Railway Com
paDy (6 Railway and Canal cases, 1872 Vice
that the holder of two scrip certificates might
maintain bill against the Company.
i. Simpson VS.. Westminster Palace Company
and Sir G. Wood (House OF Lords cases, 2l2),
the bill was by one individual, the holder OF
fifty shares; and in Government Attor-General
vs. the Great Northern Railway Company q
Law Times. Reports, 6S9), Vice-Chancellor Kin
dereley, said, p. 656, GA single shareholder, even
if 500 out of 600 shareholders agreed to carry on
a different business in addition to the rail-
way business, and it was clearly for the
benefit of the company, and If it was clear
| that they had made enormous profits
from doing it, and were continuing to derive
| those profits, single shareholder has right to
say THAT is not our contract among ourselves,
| you shall not do it, and he may come and get
| an injunction. ! may here observe with refer
| renee to some of the observations made by Mr..
| Stevens, that it is perfectly immaterlal what is
| the motive of the party in coming.
'1n the case of the Eastern counties, at the
| Rolls, where the company were engaged in esta-
| blishing packets to trade from Barwich to the
| Continent, think a single individual, or one or
| two individuals came, and it was proved to
| demonstration that they were persons who had
| actually bought their shares in the railway COM
| pany for the purpose of preventing this, because
| they belonged to some rival steam packet
| company. But the motive has nothing to do
with the matter; it is against law, 1t is against
the contract between the shareholders and it is
| against the contract which is made between the
| public and the company, when the company is
incorporated for the purpose of carrying on their
business as railway carriers. 1t is therefore
illegal, and in effect, though not in terms, pro-
| hibited by the law to a railway company
The whole of this opinion is most instructive
as to the absolute necessity of the public good,
| that these powerful railway corporations should
| be Kept strictly within the limits of their
charters. Everything beyond these limits is
prohibited, the ve-y doctrine established by our
| own Court.
In Hattersley vs. The Earl of shelburne (31