IN THE EXCHEQUER CHAMBER. (In Error from the Court of Exchequer.) 1849. ERROR MOORE v. GARWOOD. Dec. 1. In an action for money had and received, by an allottee of railway scrip, for the recovery of his deposit on the abandonment of the scheme, the letter of ment was offer ed in evidence by the plaintiff, on a bill of exceptions.-This was an action of assumpsit brought by the plaintiff below (the defendant in error) for money had and received, and on an account stated: to which the defendant below (the plaintiff in error) pleaded non assumpsit, and upon that plea issue was joined. At the trial of the cause, before Pollock, C. B., at the Middlesex Sittings after Trinity Term, 1846, it appeared that the action was brought by the plaintiff (a) to recover back the amount of a deposit; that the defendant was a member both of the provisional and of the managing committees, and had taken an active part in the transactions, of a certain projected Railway Company; and that the committee of that Company had, in the month of September, 1845, published a prospectus, headed "The Great Manchester, Rugby, and Southampton Railway Company, with a direct Line from Derby to Rugby. visionally registered pursuant to 7 & 8 Vict. c. 110. tal 3,000,000l., in 150,000 Shares of 201. each. Deposit 27. 2s. per Share." This prospectus, after setting forth the names that the two Pro Capi he refused to error on a bill of exceptions, that, under such circumstances, the letter of alreceivable in lotment was evidence with out a stamp, as there was no presumption letters were ad idem, and that the contract depended upon them alone. The deposit was paid into one of the Banks mentioned in the prospectus of the Company, on account of the Company and to their credit, the defendant being a member of the managing and also of the provisional committee; and upon application by the plaintiff for a return of his deposit, he received from the attorney of the Company an answer, to the effect that arrangements for that purpose were being made:-Held, that there was evidence that the money was had and received by the de fendant. Held also, that, as the evidence in the case did not depend altogether upon written instruments, but upon other matters of fact, it was a question for the jury, and not for the judge, what was the contract between the parties. (a) The defendant in error will be called the plaintiff throughout this report, and the plaintiff in 1849. MOORE ข. GARWOOD. of the provisional and managing committee, in both of which that of the defendant appeared, and after enlarging upon the advantages of the line, contained the following clause: "The subscribers will only be liable to the extent of their deposits, and power will be taken to allow the shareholders 41. per cent. on the deposits and calls on the opening of the line." The plaintiff had applied by letter to the committee of management for a certain number of shares in the scheme; but the defendant, when called upon by the plaintiff's counsel to produce this letter, refused to do so, though due notice to produce had been given. The plaintiff's counsel thereupon tendered in evidence the following unstamped letter of allotment, which had been sent to the plaintiff by the secretary, and which was signed by and issued under the authority of that committee: "The Great Manchester, Rugby, and Southampton Railway Company, with a Direct Line from Derby to Rugby. Registered provisionally. Capital, 3,000,000l., in 150,000 Shares of 201. each. No. of Letter, 53. No. of Shares, 50. Deposit, 1057. Offices of the Company, 1, Royal Exchange Buildings. "Nov. 1, 1845. "Sir, I am directed to inform you that the committee of management have, in compliance with your application, allotted to you 50 Shares in this Company, and that you are required to pay the deposit of 21. 2s. per Share, amounting to 1057., on or before Friday, the 7th instant, to one of the undermentioned bankers. [Here followed a list of the bankers.] The deposit must be paid within the time specified in the Parliamentary contract and subscribers' agreement, signed before the 7th of December. This letter, with the banker's receipt, must be produced when you attend to execute the deed, which will lie for signature at this office on and after Friday, the 7th instant. Arrangements will be made for sending the deed to places in the country, for the accommodation of subscribers, who will be duly advised by circular through the post-office. I am, Sir, &c., "G. J. FARRANCE." This document was objected to on the part of the defendant, on the ground that it was inadmissible in evidence without a proper stamp; but the Lord Chief Baron overruled the objection, and admitted it. On the 5th of November, 1845, the plaintiff paid into one of the banks mentioned in the prospectus, and which was one of the banks of the Company, the sum of 105l., on account of the Company, and an entry of the receipt of that sum to the credit of the Company was made by the banker's clerk in the banking account of the Company. A vast number of shares had been allotted by the 8th of December, 1845, and the allotment of shares was in full operation up to within a day or two of the issuing of the letters of allotment. The number of applications for shares was four times greater than the number that could have been issued. The letters of allotment were issued on the 1st of November, and the payments of the deposits were to be made on the 7th of that month, but the time for such payment was afterwards extended. It became impossible for the Company to apply to Parliament for an Act during the then ensuing session, as the plans and surveys were not deposited by the 30th of November, in pursuance of the Standing Orders of the Houses of Parliament. On the 10th of December the committee published an advertisement, stating that they had not been able to proceed to Parliament by reason of the unexpected delay of the engineers in completing the survey, and in the unexpected failure of the allottees to pay up their deposits; and that, in order to liquidate the claims on the Company, and to do justice to those who had paid their deposits, by returning a portion of them, they had decided on calling VOL. IV. Y Y EXCH. 1849. MOORE v. GARWOOD. 1849. MOORE v. GARWOOD. on the allottees who had not paid to pay up 28. per share, and that the project was only postponed, but not abandoned. A general meeting of the shareholders took place on the 19th of December, at which the defendant, in an address to the meeting, stated that the deposits of 21. 2s. were below 10,000l.; that the total amount of deposits was below 11,000l.; that the object in applying for the 28. per share was to lighten the liabilies of the Company, which then amounted to 17,000l.; and that, if that sum were paid, the letters of application would be delivered up. A resolution was thereupon come to, that a circular should be issued, calling on the allottees who had not paid to pay up 28. per share, with a promise that, on the payment thereof, the allottee should be released from all further responsibility, and should receive back his letter of application. On the 22nd of December a circular to the effect of the preceding resolution was issued, a circular of a similar nature having previously issued by the orders of the committee of management. The plaintiff having applied by letter to the Company to have the amount of his deposit returned to him, received by way of answer, on the 7th of March, 1846, a letter from the attorney of the Company, in which he stated that he was instructed by the managing committee to say, that arrangements were being made for paying the creditors, and that, when they were paid, it would become a question whether a rateable proportion of the deposits should be returned, or whether the Company should proceed to Parliament next session. Upon this state of facts it was contended by the defendant, that there was no evidence that the money had been had and received by him. The Lord Chief Baron, however, overruled this objection, and in summing up the case directed the jury in effect as follows:-"That the nature of the contract into which the parties had entered was rather a question of fact than of law, because it did not consist of one distinct contract between the parties, but of a series of acts and things done, from which the jury were to determine what was the real intention and meaning of the parties when they entered into the mutual relation in which they stood; that is to say, the provisional committee as the founders and managers of the scheme, and the plaintiff as a person who had applied for shares; and that the jury were to collect what was the nature of the contract from the documents, and from what was done by the respective parties; and also, that it was for the jury to consider whether the Company was ever actually established and completely formed, and whether a sufficient number of shares had been taken for that purpose; or whether it had not absolutely failed, and whether that was not the view that the parties themselves took; that there ought to have been a reasonable prospect of the concern going on; and that they were to consider whether there was any such prospect during any part of the transaction. That, if there was not, the plaintiff was entitled to recover his money back, unless he had entered into some arrangement to become a partner, or to contribute to the preliminary expenses. That the two points for their consideration were, first, looking at the prospectus, and the letter of allotment, and the receipt of the money, and any other matters that were in evidence, did the plaintiff become a partner, or did he engage to pay any part of the preliminary expenses, without reference to whether the concern began or not? That, if they should think that the plaintiff entered into no engagement to pay any part of the preliminary expenses, but that he engaged to become a partner in the large scheme which was announced by the prospectus, then the second point for their consideration was, whether the concern was ever formed; whether they thought that an application for four times the number of shares, followed up by this, that when people were called on to pay their deposits, instead of 300,000 guineas, less than 10,000l. was forthcoming, the scheme was ever on 1849. MOORE V. GARWOOD. |