cluded in the contract of the 3rd of November, 1863, were built by the contractors under the superintendence and to the satisfaction of the said Mr. M'Candlish, and with the acquiescence and ap proval of the directors, near the terminal stations on land which had been acquired for the purposes of the undertaking. No definite sum was fixed as the price for such cottages, house and stable, but there was an understanding during the time that the works were progressing that such price was to be the sum of 5,000l., which was in fact a fair price for the same." On the 27th of October, 1866, Mr. M'Candlish wrote a letter to the directors specifying the cottages which had been built, and recommending that the company should pay a rent of 5001. for them, and this recommendation was adopted by a resolution of the directors at a meeting held on the 1st of November, 1866, subject to the company having the option of purchasing the cottages on the general settlement with the contractors for the sum of 5,000l., and a copy of the resolution was communicated to Mr. Barkley as the contractors' agent. In pursuance of this arrangement the cottages were not removed by the contractors, but were left in the possession of the company. The rent of 500l. a year was paid by the company to the plaintiff, in whom all the interest of the contractors in the line had become vested down to the 7th of November, 1869, but on the 15th of March, 1870, the secretary of the company wrote to the plaintiff as follows-"I am instructed to apprise you that this company can no longer undertake the collection of the rents of cottages in Turkey as heretofore and pay the amount over to you here." Thereupon a correspondence ensued between the plaintiff and the secretary in which the plaintiff insisted that the company were his tenants; the company on the other hand denying that they were more than his agents for the collection of the rents. The 40th paragraph of the bill was as follows-" The company now claim to be entitled to the legal estate of the soil on which the cottages stand, and they allege that the Turkish Government now require that the rents and expenses of and relating to the cottages should appear in the general accounts furnished by the company to the Turkish Government, and that in consequence of such requisition on the part of the Turkish Government they, the company, cannot recognise the plaintiff's claim to the yearly sum of 5001. in respect of the cottages. The plaintiff charges that whether the Turkish Government does or does not make such requisition as aforesaid, the company are bound in equity to abide by their aforesaid agreement in respect of the cottages. "43. The company agreed with the contractors, Messrs. Peto, Betts and Crampton, as aforesaid, that if the contractors allowed the cottages to remain, the company would pay to the contractors or their assigns the yearly sum of 5007. in respect of the cottages by half-yearly portions on the 7th of May and 7th of November in every year, (determinable nevertheless on the payment by the company of the gross sum of 5,000l.) Thecontractors accordingly, instead of removing the cottages, gave up the same as aforesaid to the company in 1866, and in accordance with such agreement, the company have ever since continued and they still continue to receive the rents and profits of the cottages (except such cottages, if any, as have been burnt). They now, however, and notwithstanding that the cottages (though forming no part of the said contracts of the 3rd day of November, 1863, and 30th day of June, 1865) were built by the contractors at great expense at the instance of the company's engineer and with the company's acquiescence and approval, and were so given up as aforesaid for their use, refuse to abide by their aforesaid agreement in respect of the cottages, and the whole of the said yearly rent of 5001. is in fact due to the plaintiff from the company as from the 7th of November, 1869. "44. The plaintiff is advised and charges that inasmuch as the said agreement in respect of the cottages is not contained in any instrument executed under the company's seal, and as the company claim to be entitled to the legal estate of the soil on which the cottages stood, he has no remedy against the company except in this Honourable Court." The bill prayed that the company might be decreed to perform specifically their aforesaid agreement to pay to the plaintiff the yearly sum of 5001. until payment by the company to the plaintiff of the gross sum of 5,000l., and that for this purpose the company might be decreed to execute all necessary covenants and other instruments, and to pay to the plaintiff such damages in addition to the specific performance as the Court should think fit to award, and that an account might be taken of what was due to the plaintiff in respect of the arrears of the yearly sum of 500l., or that the company might be decreed to pay to the plaintiff such damages or compensation in lieu of specific performance as the Court might think fit to award, with other relief. The Master of the Rolls having allowed a demurrer to this bill the plaintiff appealed. Mr. Southgate and Mr. Kingdon, for the appellant. The equity arising from part performance operates against a company in like manner as against an individual, and they cannot be allowed to set up the want of a contract under seal as an objection Wilson v. The West Hartlepool Har- The company having allowed the contractors to build the cottages on the faith of there being a binding contract cannot now turn round and deny it Clavering's case, cited 3 Ves. 690; Withy v. Cottle, 1 Sim. & S. 174; Rep. 1; s. c. 2 W. & T. L. Cas. Cory v. The Thames Ironworks & Shipbuilding Company, 11 W.R. 589; Clare Hall v. Harding, 6 Hare, 273; s. c. 17 Law J. Rep. (N.S.) Chanc, 301. Mr. Fry and Mr. Davey, for the respondents. This is a mere money demand, and if the plaintiff has no remedy at law, by reason of the contract not being under seal, that does not give him a right to come into equity for specific perform ance The Leominster Canal Navigation Company v. The Shrewsbury & Hereford Railway Company, 3 Kay & J. 654 ; s. c. 26 Law J. Rep. (N.S.) Chanc. 764; Kirk v. The Bromley Union, 2 Phill. 640; s. c. 17 Law J. Rep. (N.S.) Chanc. 127. Mr. Kingdon was heard in reply. THE LORD CHANCELLOR (on June 5).— This case comes before me on appeal from the Master of the Rolls, who has allowed a demurrer to a bill filed by Mr. Crampton against the Varna Railway Company, in respect of a certain contract which he alleges to have been entered into by him with the company, whereby, being the contractor for the line of railway, and as such contractor having occasion as a part, whether of his duty or his convenience, in the carrying out of the works, to erect huts and lodgings for the men who were at work on the railway, he entered into an engagement with the company, whereby they agreed that if he would erect cottages of a more durable character than huts, and instead of taking away the materials, as he would be entitled to do at the end of his contract, he would build the cottages so substantial that they would remain permanent buildings on the land of the company, they on their part would undertake to pay him a sum equivalent to 5001. a year in respect of the use of these cottages, subject to their having an option at any time of substituting for that annual sum a lump sum of 5,0007. Undoubtedly the case is one of a very singular character, and one I may almost say of first impression in some respects. It is not alleged that there was any formal written agreement; but it is said the agree ment is to be found in a letter written by the agent of the plaintiff to the company's agent, and averred to be true, reciting what had passed with regard to this arrangement between him and a gentleman duly authorised by the company to enter into the engagement on their part. Therefore we must take it that the case is carried as high as this by the bill—that a person duly authorised by the company to enter into an engagement did enter into a formal engagement, and it is not said to have been anything more in its inception, that if the plaintiff would build substantial cottages instead of huts, and leave them standing, the company would pay him 500l. a year, or in lieu of that 5,000l. The plaintiff, no doubt, is in a position of considerable difficulty under all the circumstances of the case, because one of the provisions under which the company is founded under the Sultan's firman is that all contracts and engagements must be entered into under seal, and the plaintiff himself says that this engagement is not under seal, although he avers that the secretary was duly authorized to enter into the engagement. Beyond this, he says, further communications took place between them by letter, and they did pay the 500l. a year, so that he has evidence of the contract in the nature of res geste, and has performed it on his part by erecting substantial cottages, and leaving them there, and the company have recognised the contract by paying 500l. a year in performance of it. Subsequent letters passed, in which both sides seem to have found it difficult to shape their respective demands. The company made payment of the 5001. for some time, but after a time they chose to treat themselves, which I do not see on the face of the bill that they had a right to do, as mere agents for the plaintiff, to receive the rents of the cottages, and pay them to the extent of 500l. Of course the rents might fall short of that, and so the plaintiff said, that is not the agreement between us; what I require you to do is, to pay me 5001. a year, whether the cottages are let or not. The agreement is a very singular one, because it is not averred that the cottages being built on the land of the company, they agreed to demise them to the plaintiff, and then to take by sub-demise from him these cottages, so as to give him all such rights as may be acquired in Turkey-if, as I suppose, they have such things as leases and rents reserved upon them. The truth is, when it comes to be analysed, it appears to me, looking at the case how you will, that it can only come to a contract to build houses on another person's land, and to be paid so much for the building. That really is a money contract not enforceable in this Court. You cannot have specific performance of a builder's contract of that sort in the manner in which specific performance is usually decreed in this Court, and of course you cannot call to your aid in that respect the Act of 21 & 22 Vict. c. 27, commonly called Lord Cairns's Act, because it has been settled conclusively that unless the Court has original jurisdiction to compel specific performance, it cannot give damages instead. If the Court has jurisdiction to compel specific performance, and that specific performance is inconvenient, and damages would be more convenient, then having the option of the two, the Court is enabled to exercise that option at the request of the plaintiff. But here the question is, first, whether there are any means of compelling specific performance of this contract by the plaintiff, supposing he had been the person unwilling to perform it, and after having engaged to build the cottages had declined to do so? I apprehend clearly not. Then this being a mere money engagement, the plaintiff suggests another view which was very ingeniously argued; he says it comes within the range of that class of cases in which a person standing by and allowing another to spend money upon his property under the belief that it is his own, has been held to be precluded from taking advantage of that misapprehension. That class of cases is numerous, and it has not been allowed to corporations any more than to individuals to take the benefit of a misapprehension, on the faith of which the other person has expended money on the perty. But that class of cases has no application to the present: they are all founded on the ignorance of the person who has been allowed to proceed as if he were himself to be owner, and the Court assumes that the person who has allowed pro He him so to treat himself has entered into an engagement that he shall be what he supposes himself to be. But when two persons enter into a contract they know exactly what their position is. The plaintiff knew the land was not his, and that he was dealing with another person. knew that what the company had to do was to pay him 500l. a year for what he was doing in building these cottages. The Master of the Rolls said it was reduced to a mere money contract. I believe he is right in that, and being a mere money contract, and not a proper subject for specific performance, the Court cannot give relief by way of damages. Then the case of Kirk v. The Bromley Union (ubi supra) was referred to, which decides that where there is an actual contract in pursuance of which certain things are to be done, and a receipt or certificate is to be given by way of evidence of their having been done, and the officers who are to give that receipt or certificate act in bad faith, and deprive the person of the benefit of the contract by rendering it impossible to perform the conditions of it, the Court sees its way to saying that notwithstanding the contract is not executed modo et forma by the default of those who endeavour to frustrate the execution of it, the execution can be compelled; but this case is a simple case of suing at common law, and because you cannot sue in a court of common law for want of a seal, that is no reason why you should be entitled to file a bill in this Court, not only to fulfil the contract but to constitute the contract itself. The truth is when you act with persons like these you must be taken to know what their power of contracting is, and you must frame your contract accordingly, and when you have only a money demand and have not got a contract this Court cannot interfere. I certainly was impressed, I confess, with the consideration of the length to which these matters might be carried, but I think there is always this answer to be made to that observation, that this Court's arm is strong enough to apply itself to all cases in which it may appear to be necessary to do so. It occurred to me that it might so happen that you might have a contract without seal, by which the whole railway should be made, and in which the company would participate in the profit, and yet it might be said that they were not liable to pay for the making of the line. When any such case comes to be considered I think there are two ways of meeting it. It may be that you may have a special remedy against the individual with whom you entered into the contract, although you may have none against the company, or it may be that the Court, acting on principles which are well recognized in other cases, such for instance as The German Mining Company's Case (1) where the company got the full and complete benefit of the contract, and for some time retained it, will find its way to saying that the company shall not be allowed to raise any difficulty as to paying for it. But this is an entirely different matter, a matter collateral to the main contract itself; for although, no doubt greatly to the accommodation of the people who are to live in the neighbourhood, it was not itself essential to the existence of the railway for which the company was incorporated, and therefore the case is of a totally different character from those in which the company would be in daily and hourly use of that which they seek to retain without paying for. I think the case is an unfortunate one, but subject to what remedy may be had at law against the person who entered into the engagement with him, it appears to me that the plaintiff will be left without remedy in a case which no doubt is one of considerable hardship. I am compelled to dismiss the appeal, and the law being tolerably well settled, I am obliged, though I regret it, to dismiss it with costs. Solicitors--Messrs. Baker, Folder, and Upperton, for appellant; Mr. H. P. Sharp, for respondents. (1) 4 De Gex, M. & G. 19; s. c. 24 Law J. Rep. (N.s.) Chanc. 41. The articles of association of an Assurance Company provided that all securities made on behalf of the company should be sealed with the company's seal, signed by two of the directors and countersigned by the secretary, and when so sealed, signed, and countersigned, should be valid and enforceable against the company. The company requiring accommodation from their bankers, the directors passed a resolution, that certain title deeds should be deposited with the bankers as collateral security for bills under discount, and the deeds were deposited accordingly. The bankers then discounted bills directly for the company, and also bills for third persons on which the company were liable, and the company being afterwards wound up, the bankers sold the property comprised in the title deeds for a sum greater than would cover the amount due on the bills directly discounted, but less than their general debt: Held, first, that the deposit was only intended as a security for bills discounted directly for the company: Secondly, that the bankers not being officers of the company had not imposed upon them the duty of seeing that the formalities required by the articles of association were complied with; and that the equitable mortgage by deposit was valid although these formalities were not complied with, and although it was not registered under section 43 of the Companies Act, 1862: Thirdly, that by analogy to Hazelfoot's Case (41 Law J. Rep. (N.s.) Chanc. 286; s. c. Law Rep. 13 Eq. 327), the bankers had, as mortgagees, a right to retain as against the liquidators of the company the balance which would remain in their hands after paying the amount due on the bills directly discounted for the company, in satisfaction of their general debt. Adjourned summons. The General Provident Assurance Company, which carried on its business in the Strand, kept a banking account with the Camden Town Branch of the National Bank; and with a view to obtaining further accommodation from their bankers, the directors at a board meeting held on the 13th December, 1866, passed the following resolution: "Resolved that the mortgage securities represented by bond No. 1, should be lodged with the National Bank at Camden Town, as collateral security for bills under discount." Under the authority of this resolution, the said securities, which comprised the title deeds of certain freehold and leasehold properties, were deposited with the Camden Town Branch, and bills were discounted for the company. The company was ordered to be wound up on June 6, 1868, and under an order of the Court the properties comprised in the title-deeds which were so deposited were sold without prejudice, and the proceeds which amounted to about 9001. were paid over to the liquidators of the company and held by them, subject to the order of the Court. It appeared, that at the date of the order for winding up, the company were indebted to the bank to the amount of 2,3491. 18. 11d., but that the only amount due to the bank in respect of advances or discount made directly to them was 5031. 14s., the remainder of the bank's claim consisting of liabilities on bills of exchange or promissory notes, discounted by the bank for other customers upon which the company were liable, either as makers, acceptors, or otherwise. The liquidators contended that the proceeds of the sale were only applicable to the discharge of the 5031. 14s., and that the bank had nothing more than a right of proof for the remainder of their claim; and the bank now took out a summons in the winding up and claimed the whole amount of the sale moneys. The transactions between the company and the bank were chiefly carried on through Mr. Heywood, the manager of the company, and Mr. Chaston, the manager of the bank; and the former gentlemen having gone to America, and Mr. Chaston |