to me clearly that there was not any satisfaction, and that Overend, Gurney & Co. were not paid, or intended to be paid, by the arrangement which was come to on the 27th of April, 1866. The real question is, whether this is a case which falls within the authorities by which it has been long settled, that time being given to the principal, the surety is discharged. The learned judge seems to have given some weight to the suggestion that this was a principle which had never been fully understood as regards the basis upon which it is to rest, and that it would have been better had the Court ab initio decided, not that the surety should be absolutely released, but that he should be put to prove his damage, and obtain damages for any injury he might have sustained, and that therefore the authorities which have proceeded upon this principle are in no way to be extended. I do not feel myself at liberty to comment upon the propriety or impropriety of a principle which in Samuell v. Howarth (ubi supra) is stated by Lord Eldon as being a principle long established then (that was in the year 1817, or more than half a century ago), and upon which authority after authority has acted ever since. I do not feel myself at liberty to say that it is not as well settled and established as any other principle upon which the Courts of equity administer justice between parties. I think sometimes the authorities are a little open to this observation, that they do not all of them very clearly and distinctlyespecially the later ones-shew in what way the principle was established and brought to bear. But, looking to the earlier cases, amongst which I might cite Sir John Leach's judgment, which is given in the note to Oakeley v. Pasheller (ubi supra), the principle is laid down that if you contract with the principal to give him time, it is contrary to that contract that you should sue the surety, because if you do you immediately turn the surty upon the principal, and therefore your act breaks the engagement into which you have entered with the principal. It is not simply neglecting to sue the principal which would have any effect upon the surety, but there must be a positive contract with the principal that you will postpone the suing of him to a subsequent period. To shew that this is the principle we have only to refer to another class of authorities which until recently clearly and distinctly establish that it is competent to the creditor, if he thinks fit, to reserve all his rights against the surety, in which case the surety is not discharged; and for this reason, that the contract then made with the principal is preserved, because the creditors have engaged with the principal that they will not sue him for a given time, but subject to the proviso that they shall be at liberty to sue the surety and turn the surety upon him, and that that shall be no breach of the engagement. That, I may say, has been recognised up to a late period, because, although Lord Truro threw some doubts upon it in the case of Owen v. Homan (ubi supra), when the case came before the House of Lords Lord Cranworth in giving judgment said, there could be no doubt about it, and he did not think he should have entered into any discussion of the case had it not been for the doubts thrown by Lord Truro upon that principle, namely, that you might retain the surety if that formed part of the original contract as to not suing the principal; and he said he thought it right to protest against the doubt, because he thought it was a doctrine perfectly clear and established. That being so, let us just see what was the condition of the parties. It appears to me quite plain that as between McHenry and the plaintiffs themselves, the plaintiff's were secondarily liable and McHenry was primarily liable. The plaintiffs were only liable as sureties. The learned Vice Chancellor in the Court below entered at some length into the question whether these were accommodation bills. We are told over and over again that with regard to a bill by way of accommodation, although the acceptor could not at law deny his position as primarily liable, nevertheless in equity he could succeed in shewing that the bill was merely an accommodation bill. But whether this is to be called an accommodation bill or not where some commission is paid for the lending of the name, I think, is not worthy of further inquiry. The substance of the matter is this: Is it or is it not a case in which the relation of principal and surety subsisted? and I think, upon the whole, it clearly is. The second point raised is that in effect this contract which was entered into with McHenry was not a contract to give time to him, but was in substance a contract to give time to the surety, and Mr. Cole argued that it would be an extension of the principle to hold that the giving of time to the surety and not to the principal is to bring the case within the operation of the rule. But I think there is a very great fallacy in that reasoning. McHenry was at that moment liable upon the bills. He had given a guarantie to pay them at maturity. Messrs. Overend, Gurney & Co. had been informed before the engagement with McHenry to hold the bills till Lillo's bills on the Bank of London should run out, that the plaintiffs were as between themselves and McHenry in the position of sureties. Being informed of that, and saying they would hold these bills, means plainly, that they would not put McHenry into the position of being sued anterior to the running out of Lillo's bills, because if they did not hold the bills, if they sued the acceptor, or if they took the money from the acceptor, and then handed over the bills to him as paying them, they would obviously break their contract with McHenry, which contract was that McHenry was to have the time which would elapse between the period when the bills were actually due and the period of the running out of Lillo's bills; and any steps taken against the acceptors of the bills would upset the whole contract, and break the engagement entered into with McHenry, by making him liable to pay before Lillo's bills should run out. That would be the clear and distinct result, and, in truth, the point I have been commenting upon and which is now firmly settled, that you may reserve your rights against the surety, shews that you might then, without breach of your engagement with the principal, sue the surety. But if you enter into a contract with the principal that you will not sue the sureties, it is only making still stronger that which is tacitly considered to be involved in every engagement with the principal to give him time, that you will not sue the sureties; and, therefore, the giving expression to that tacit arrangement cannot make the matter less favourable to the surety, who says that he is to be discharged upon that doctrine. Certainly, as I have said, the case is not put so clearly upon the effect of the engagement with the principal, but is rested partly upon this, and no doubt rightly so rested, that you change the position of the surety, because it is one thing to lie by and wait as long as you please, which you are entitled to do before you sue the principal, during which time the surety has the right to come and tender you the money and discharge the engagement, and immediately sue the principal, and it is another thing to engage positively with the principal that you will give him time, and so tie up your own hands from doing that which would throw the surety immediately upon the principal. Further than that, it does tie up your hands against ever receiving payment from the surety, because if you receive payment from the surety you would be obliged to give up the bills to the surety and turn the surety upon the principal, which would be contrary to the whole engagement entered into. It seems to me there is only one point remaining in the case which deserves consideration. Mr. Cole pressed me very strongly with the argument that Overend, Gurney & Co., at the time they took the bills, knew nothing of this. They believed the plaintiffs to be principals in every sense of the word as between themselves and the defendants. He said their position could not be altered by their being informed afterwards of the existence of a different arrangement, and he cited as an authority, Ex parte Graham (ubi supra), in which the Lords Justices asked if there were any authority to shew that knowledge acquired subsequently to the engagement would fix upon the creditors the obligation of seeing to the interests of the surety; and counsel cited none. It seems to have been held in that case that the discharge did not take place; but unfortunately in that case the autho rity of Oakeley v. Pasheller (ubi supra), in the House of Lords, was not cited; and that is a precise and direct authority upon the point. In that case, which was the ordinary case of principal and surety, a bank owed 10,000l. to the creditors of Sir Charles Oakeley, having borrowed it for the purposes of the bank. One of the partners who so borrowed the money died, and a bond was given by his executors for the payment of the money. At the time that bond was given Sir Charles Oakeley did not know that the persons giving the bond were not principals, and in fact, at the time of giving the bond, they were principals and nothing else, and were liable with their copartners. But subsequently to that an arrangement was entered into between the bank and the executors of the deceased partner, by which the bank bought all his share and interest in the concern, and undertook to pay all his debts and liabilities on behalf of the concern. From that moment of course, and only from that moment, the executors who gave the bond originally as principal debtors to the creditor, became as between themselves and the remaining partners of the bank simply sureties for the debt, and Sir Charles Oakeley was held by the House to have had distinct notice of that change in the position, and he was held by Sir John Leach in the Court below, and by the House of Lords above, to have discharged the executors of the deceased partner, who originally gave this bond to the creditor, and who had originally been the principal debtor. That is a case distinctly and plainly in point, and I apprehend the hardship of such a principle as that is not such as Mr. Cole represents. There is really in substance no hardship, and that is one reason why I dwelt at some little length to shew that it was not a doctrine which was at all shaken by the right of the creditor to preserve his remedies against the surety; and if there was any small hardship they could have freed themselves from that hardship and all difficulty whatever. A person comes and tells them that since the debt was contracted circumstances have arisen by which he is in fact surety, and the other debtor is the principal debtor; thereupon. all that they have to do is to give the principal debtor time, and reserve their rights against the surety. If that had been done it would have fallen within the principle of Owen v. Homan (ubi supra), and been completely free from all difficulty. I confess, therefore, that it appears to me to be a plain case within the line of authorities, and that I am not moving one single step beyond the clear principle which those authorities have established, when I reverse the decision which the Vice Chancellor came to, and make a declaration according to the prayer of the bill. I think the defendants should pay the costs of the suit, which they have rendered necessary by attempting to sue after the arrangement which they had entered into. There will be no costs of the appeal. A railway company being indebted to the contractor for its original line in a sum of 5,7341., obtained an Act of Parliament for the making of an extension line, which Act authorised the raising of 85,0001. by shares to be called "extension shares" and of 28,000l. by mortgage, and enacted that the works thereby authorised should for financial purposes form a separate undertaking, and that the capital and new shares should constitute a separate capital, and that the money to be raised, by mortgage should be applied only to the purposes authorised by the Act. The contractor having obtained judgment for the amount due to him, extended certain surplus lands acquired under the extension Act, and then petitioned the Court for a sale:-Held (affirming the decision of WICKENS, V.C.), that the judg ment creditor was entitled to his order for sale; for that, whatever might be the equities of the shareholders inter se, that could not affect the right of the creditor to have the lands sold to pay the debt due to him. This was an appeal by the Tendring Hundred Railway Company from a decision of Vice Chancellor Wickens. The above railway company was incorporated for the purpose of making a railway near Colchester by an Act of 1859, and by another Act of 1862 the company was empowered to extend the railway into the centre of the town of Colchester and to the camp. Ogilvie was the contractor for the original railway, and had a considerable claim against the company, who, in April, 1863, and in February, 1868, gave him two acknowledgments under their corporate seal that they were indebted to him in the respective sums of 2,000l. and 2,8201. for work done and materials supplied by him for the purposes of the undertaking. In September, 1869, Ogilvie obtained a judgment in the Common Pleas against the company for 5,7341., and on the 12th of July, 1870, issued a writ of elegit on the judgment under which the Sheriff of Essex seized some lands which were specified as surplus lands of the company, and delivered them to the judgment creditor, who thereupon presented his petition under 27 & 28 Vict. c. 112. s. 4 for the sale of the land. The company resisted the petition on the ground that the lands which had been extended under the judgment were not lands acquired by them either under the Act of 1859 or under that of 1862, but had been acquired under powers conferred by the Tendring Hundred Railway Extension Act, 1863. By that Act the company was empowered to make a new line to Weeley and Walton, in Essex, and to raise, for the purposes of the Act, 85,000l. by the creation of shares to be called "extension shares." The 40th section of the Act was as follows: "The railways and works by this Act authorised to be constructed shall, for financial purposes, form a separate undertaking, and the capital and new shares created under the powers of this Act shall constitute a separate capital." The 49th section empowered the com- pany to borrow on mortgage to any amount not exceeding 28,000l., and by section 50, "All and every part of the money which the company are by this Act authorised to raise by new shares or on mortgage shall be applied only to the purposes authorised by this Act." The company therefore contended that the extension line formed a separate undertaking, and was not subject to the liabilities of the company in respect of the undertaking authorised by the two earlier Acts. The petition. nevertheless having been presented, the Vice Chancellor, on the 10th of November, 1871, ordered that the following inquiries should be made : first, What was due to the petitioner under his judgment; second, What lands had been extended under the elegit, and what were the nature and particulars of the interest of the company therein, and of their title thereto, and whether any and which of such lands were superfluous lands within the intent and meaning of the Lands Clauses Consolidation Act, 1845; third, Whether there were any and (if any) what incumbrances on the extended lands, and what were their priorities, and what was due on account thereof respectively, and the further hearing of the petition was adjourned. From this order the company appealed. The hearing of this appeal was opened before both the Lords Justices, but it was concluded before Lord Justice James alone. Mr. Greene and Mr. Millar, for the company, referred to The South Yorkshire Railway and Ames v. Trustees of Birkenhead Docks, Gardner v. The London, Chatham and Dover Railway Company; Ex parte Grissell, Law Rep. 2 Chanc. 385; Bowen v. The Brecon, &c., Railway Company, 36 Law J. Rep. (N.S.) Chanc. 344; s. c. Law Rep. 3 Eq. 541; 2 X Re The Potteries, &c., Railway Company, 39 Law J. Rep. (N.s.) Chanc. 273; 8. c. Law Rep. 5 Chano. 67. Mr. Dickinson and Mr. Beale, for the respondent, were not called upon. LORD JUSTICE JAMES said that the Vice Chancellor could have made no other order. The appeal was grounded on a misapprehension of the functions of the Court with regard to such a case. His Lordship read the 4th section of 27 & 28 Vict. c. 112, and said that under it a judgment creditor was entitled to ask ex debito justitiæ for a sale of the debtor's land. Of course, under such an order, nothing but the debtor's interest in the land could be sold, nor would the order interfere with the interest or equity of anybody else. If this were a contrivance between the directors and the judgment creditor to give the latter improperly a charge on the land-a charge which they had no right to give-no doubt this Court, as a Court of equity, would restrain such a proceeding. But there was no suggestion of anything of the sort here. railway company, if they contracted a debt, must pay it, just like any other debtor; and if a creditor got a judgment at law, there was no reason why he should not make use of it. The private acts might create equities between the different classes of shareholders; the shareholders of the extension line might have a right to call on the original shareholders to make good to them what they might lose under this judgment, but that could not affect the rights of the judgment creditor or the liability of the company to pay its debts. The arrangement come to in the private acts was for financial purposes, and no other. The appeal must be dismissed with costs. A Solicitors-Messrs. F. & T. Smith & Sons, agents for Philbrick & Son, Colchester, for appellants; J, B. Batten, for respondent. This was an appeal by the official liquidatior of the above company from an order of the Master of the Rolls, directing him to make the usual affidavit of documents in his possession. The official liquidator, under circumstances which it is immaterial to state, was seeking to place the respondent, Mr. Gooch, either on the list of contributories as a present member, or in the alternative, upon the list as being liable in the character of a past member, in respect of certain shares which had been transferred within a year of the commencement of the winding up. With a view of contesting this alternative liability, the respondent took out a summons that the official liquidator should make the usual affidavit of documents in his possession, upon which the Master of the Rolls made the order now under appeal, his Lordship considering that the liquidator was in the same position as if he were party to a suit, and the order was in the form usual in suits. He Sir R. Baggallay and Mr. Chitty, for the appellant. It is a mistake to consider the official liquidator as a party to a suit, he is merely the officer of the Court. is entitled to be paid for the time during which he is occupied in conducting the winding up. If, then, he were obliged, for the purpose of making this affidavit, to examine every document in his possession, what a hardship it would be upon the |