The plaintiffs in this suit filed their bill to have the accounts taken in this Court, and an injunction was granted restraining proceedings at common law

40 Law J. Rep. (N.S.) Chanc. 82. The plaintiffs contended, first, that the defendants were precluded by their own laches, in not making a yearly demand for deficiencies, from claiming anything in respect of any year earlier than the one before which demand had been made. In the second place, that the accounts should be taken on the footing of their having been guilty of wilful default in not having taken certain tolls which they were entitled to, and in having let their tolls for a fixed sum during part of the times. The tolls omitted were those in respect of packages under 14 lbs., and on passenger's luggage by steamers from the Channel Islands and France.

Sir R. Palmer, Mr. Kay and Mr. Montague Cookson, for the plaintiffs.-The account ought to be taken on the principle of wilful default, inasmuch as they had not taken all the tolls they were entitled to: and were to be taken de anno in annum, as a shifting body of shareholders, should not be made liable for what their predecessors had paid, no account ought to be taken for years in respect of which demands had not been made at the time; in fact the defendants had lost their right by acquiescence—

Drewry v. Barnes, 3 Russ. 94;
Duke of Leeds v. Earl Amherst, 2 Phil.
117; s. c. 16 Law J. Rep. (N.S.)
Chanc. 5.

The Solicitor-General, Mr. Eddis, and Mr. Cutler, for the defendants, contended that they had been guilty of no negligence that would prevent their claiming

Ramsden v. Dyson, Law Rep. 1 E. & I. 141;

Archbold v. Scully, 9 H.L. 383; Rochdale Canal Company v. King, 2 Sim. N.S. 78; s. c. 20 Law J. Rep. (N.S.) Chanc. 675; Jones v. Pope, 1 Saund. 34. They were entitled in their discretion to remit the tolls they did; by doing so, in fact, they increased their traffic and the other tolls taken; and they could let them, for by so doing they saved the cost of collection.

Mr. Kay replied. On the point of acquiescence he cited

Dann v. Spurrier, 7 Ves. 235.

BACON, V.C., after stating the facts previous to the Act of 6 & 7 Vict. c. 65, and reading the 53rd section of that Act, said-And that is the obligation which at present exists. That is what the company have to pay the Commissioners of the Harbour. Now it is impossible to read that last clause, which is the only one necessary for the present purpose to refer to, and not to see that this is the state of things. The Commissioners have the power conferred by the Legislature of levying rates and dues; the company have the power to receive income in respect of their dock-if the income of the Commissioners falls below 1,000l. a year, the company is to make it up to 1,000l. a year-the Commissioners have power to reduce their dues if they like and to enter into contracts, as I read the Act, for the dues which were payable, to take any rent in respect of the dues, and the payment which is to be made by the company is in preference to any dividends which they may make and distribute among their shareholders.

Now the duty of the company as to all money received by them is very clearly and distinctly prescribed by the Act. They are trustees merely. They receive the moneys in the first instance for their own benefit. If they have borrowed money, they have to pay the interest on the money they have borrowed; they have to make any other payments which may become necessary for the carrying on of the enterprise in which they are engaged, and they are to make and distribute dividends of all that remains among their shareholders; the money is not theirs, but the statute provides that before any payments shall be made to the shareholders, the persons entitled to receive it, the sum necessary to make up the deficiency of 1,000l. shall be set apart, so that the Act of Parliament really deals with all the funds which can come into the hands of either of these companies, appropriates those sums, and gives them a plain and distinct destinanation, and, as I read the Act of Parlia

ment, there can be no doubt that if all the preceding liabilities to the payments of dividends have been satisfied, then the shareholders are the only persons entitled to receive what remains, and that that was the plain meaning of the Act of Parliament no one who thinks upon the subject can for a moment doubt, nor can it be doubted, that each of those companies, the defendants not less than the plaintiffs, knew their respective rights, and knew what their duties were, and I take it to be as clearly the duty of the defendant Commissioners at the end of every year when the 31st of March has arrived to make any claim or demand which they may have under these Acts of Parliament against the company as it was to discharge any of the other duties imposed upon them by the statute. They could not, in my opinion, carry on their business with any propriety without doing it. The provision was inserted for their benefit. It was an obligation laid upon the Dock Company, and was to be discharged by them; but when? Can it be said that they were to retain money in their hands to provide for some demands which might be made by the Commissioners ? What sums should they retain in their hands? How could they tell that any money would be payable by them, and if they could even guess that any money would become payable, how could they tell what amount would be payable? The former Act had provided that books should be kept in order to ascertain the amount. That provision is repealed by the Act of the 6th & 7th Victoria. Therefore they remain in this position. They receive money, the destination of which is prescribed by the statute. There is a payment to be made out of the Dock Company's receipts, but not unless the Commissioners require it, and when it is said that there is a clause in the Act of Parliament which enables the Dock Company to make a reserve fund, it is quite clear that has no application to the present case, because in the first place it is purely optional whether they should do so, and it would be contrary to the plain meaning of the statute to read it as meaning anything but this, that if in the enterprise which you are

engaged in it becomes necessary that you should provide for some payment that will come upon you in some future year for repair to the docks, or anything of that kind, you are authorised to set apart an amount sufficient to answer that purpose, and you are not obliged to ask the leave of your shareholders whether you should do that or not. To hold that the meaning of that clause is that they should set apart a fund for the purpose of providing for any demand that may be brought against them would be doing violence to the language, and would be plainly against the common sense and reason of the thing.

This last Act was passed in the year 1843, since which time these different bodies, inhabitants of the same town, have been engaged in business of a similar nature, and no demand whatever is made by the Commissioners against the dock company until the month of June, 1870. In the meantime, the Dock Company have done the only thing which they could do. At the end of each year they have made up their accounts, and have paid what was due in the shape of preference, and they have distributed the rest amongst their shareholders. The money is gone and has been distributed exactly in the same way as the statute required, but in the year 1870, there comes a demand by the Harbour Commissioners against the Dock Company for a sum amounting to 3,710., and it is made up thus, a deficiency, that is to say, a deficiency in the receipts of the 1,000l. which is said to be for the year ending March, 1847, 54., and then going on through the successive years down to the year 1858, when the amount seems to be 4017., and so a total of 3,7107. is arrived at by that account.

[His Honour here stated the correspondence between the two corporations previous to litigation, and the prayer of this bill, and proceeded :]

Now on the part of the defendants it is contended that under the circumstances they were entitled during each of the years which form the subject of this suit, to receive from the plaintiffs the amount of the deficiency. They say, moreover, that they were under no obligation to make any demand. Now that only was

contested, but it was the very essence of the plaintiffs' case that if the demand had been made at the proper time, they should have had the means of providing for it or for so much as was justly due, and would have had the opportunity of inspecting the accounts of the Harbour Commissioners, for although the direction to keep the books is no longer to be found in the Acts, since the first Act of Parliament was repealed, yet as a matter of fact they would be entitled in this Court, and probably without resorting to this Court, to have an inspection of the books on which alone that account could be kept, out of which it might be made to appear that there was no deficiency below 1,000l. No demand was made whatever until the year 1870.

It is clear to my mind, according to the construction of the Act of Parliament, and I say this as well for the plaintiffs as for the defendants, that the payment was to be an annual payment. At the end of each year the accounts were to be made up; when they were made up, the sum payable, if anything was payable, would have been ascertained, and I think it was plainly incumbent on the defendants, if they had any demand whatever to make against the plaintiffs, to have notified that to them at the end of every year so as to enable the plaintiffs to perform literally and fully the obligation which the statute had laid upon them and pay out of the receipts of the year just then elapsed so much money as was coming to the defendants. That by failing to make this demand the plaintiffs' position has been prejudiced is quite clear. The present owners of the shares are under no obligation or liability to pay. The present owners of the shares have a right to consider that anything to be done up to the present time, or when the demand commenced, has been properly done, for they are entitled to an annual payment as the defendants were. The accounts have been made up annually, they have received what appeared to be their shares, and they have received it only because the plaintiffs, the Dock Company, have looked at their accounts, have ascertained the amount of money in their hands, have provided for all the paymen's which they

were bound to make and have handed over all the rest to the shareholders for the time being. Can there be a stronger case? If laches has taken place at all in such a case as this, here is a case of the strongest possible laches. The very test that is applied in order to ascertain whether laches have been committed or not is, whether the situation of the parties who have been affected by those laches has been altered by reason of it. That is so here. The Harbour Commissioners have in each and every year since 1843, I suppose at all events since 1847, by making no demand encouraged the plaintiff's to do that which they must be taken to have known would be done, this being an Act of Parliament in which the interests of both of them are provided, for they must be taken to have known that in the absence of any demand being made by them, it would be the duty of the plaintiffs to distribute the moneys they had in hand; knowing all that, they forbear making any demand during all those years which I have adverted to, and which end with the year 1870. But there is more than that, for during all the period of the litigation, when they had not been convinced that they had any demand to make against the plaintiffs, or thinking that they had no right to enforce the demand against the plaintiffs, they ought to have given some notice of what might be the result of the proceedings under the mandamus, but they are entirely silent on the subject. There is not only no demand but there is no suggestion and no notion that whatever may be the result of the mandamus, they can have any demand against them, and so the matter goes on until the letter of June, 1870.

Then it is said by the Commissioners that the plaintiffs must be taken to have known of the demand that was existing against them, for that, in 1861, in a report issued to their shareholders, they speak of the proceedings under the mandamus as existing. No doubt they did; but they spoke of them in such a way as, in my opinion, they were perfectly at liberty to do. They said, there is this claim being fought between certain members of the public and the Commissioners of the Harbour, but which we are advised

can never be established. And at that time, with the notoriety which the report must have given to the subject, no claim being made by the Commissioners, or any other persons, they proceeded to distribute the dividends. I say again, if standing by and permitting a person to alter his posi tion does amount to laches, here I find it in the most abundant and clearest manner. They must have known that dividends would be declared, and they must have known that they could only be paid out of the moneys in hand. They stand by and see that done, and offer no sort of objection, or word of remonstrance or protest, or anything else. I am of opinion, therefore, that for all those years during which the account extends, the defendants are clearly precluded by their acquiescence; and, having regard to the terms of the Act of Parliament, and having regard to the rights and duties which were incumbent upon the defendants as well as the plaintiffs, that they cannot now raise up that claim, nor bring in any claim, iu respect of those years, against the plaintiff company.

Then the question is, whether they can claim for the period between 1858 and 1870. I do not see anything, having regard to what has taken place in the case, that prevents their making the claim in respect of the years from 1858 to 1870, and I say so, particularly with reference to the letter of the 8th of October, in which there is a plain submission to pay whatever under the Act of Parliament is payable. I think, therefore, that an account should be directed, from the end of the year 1858, of the moneys which are payable under the Act of Parliament, that is to say, of such sum as should be found to be the amount of the deficiency between the receipts of the Harbour Commissioners and the 1,000l. which the plaintiffs are bound to make up.

Then, the only other question is, whether that account should be directed with wilful default. Now there have been three instances mentioned, in which it was said that the defendants had been guilty of wilful default. No doubt, under the Acts of Parliament, they were at liberty to reduce their tolls. I do not find that they have ever done so, bnt I find

that they have omitted to collect tolls which they might have received; and as no excuse has been offered, and if any excuse could be offered to that, they ought to be prepared to shew that they have done this with some notice to the plaintiffs, because what the plaintiff's have to do is to pay the deficiency, and the real amount of the deficiency can only be ascertained by finding out what has been or might have been received by the Commissioners under their Acts of Parliament. I think to forego payment upon all parcels below 14 lbs. in weight might be, and no doubt is, an injury to the plaintiffs. It was right for the defendants to reduce their tolls, if they thought fit to do so, but it could not be within the meaning of the provisions of the Act of Parliament that they should omit to receive altogether some of the tolls, no matter for what reason. Possibly the interests of the pier, and harbour, and docks were and are very complicated. There may have been reasons which induced them to do that, and they may have acted with perfect prudence with regard to their own rights, but they had no right to prejudice the rights of the plaintiff's. I think that is one instance of wilful default. Another is that the bags of the passengers at the pier, embarking and disembarking, were exempted from toll. That is no reduction of tolls, but it is a gratuitous act on the part of the Commissioners, who happened, I believe, also to be interested in the pier, and who thought it a very good way to manage their business, but one for which the plaintiffs are not to suffer. The third instance of wilful default is, that they have chosen to grant leases of these tolls instead of collecting them by their own servants. There is no power for that

I

whatever in the Act of Parliament. have referred to the words by which they are empowered to take rents, and having those words clearly in my recollection, I can find nothing in the Act of Parliament which justifies the defendants in having farmed out or rented the tolls, which they themselves ought to have received. The Act of Parliament enables them to receive them. It was in respect of what they did receive that the plaintiffs were called upon to pay up the deficiency. They have

chosen to hand this over to some other persons, and not to receive the rates and dues but a lump sum of money, which may be more or less than that which they would have received by means of the dues they have chosen so to deal with them. In my opinion they have no authority under this Act of Parliament to lease their tolls to anybody. They could not do so without giving some advantage or bonus to the lessees. It may have reduced their expenditure in other ways, it may have saved the expense of collecting. It may have been prudent, as they thought fit, but, as between themselves and the plaintiffs, the plaintiffs ought not to be prejudiced by it, and therefore, I think, that the account I am now going to direct

must be directed in the manner I have mentioned, and on the footing of wilful default.

The letter contains an offer to pay what shall be found due. I think that disposes of everything except the costs, and the costs must necessarily be reserved. The account must be taken. It may be diffi cult to take the account. By no means do I think it impossible.

Solicitors Mr. H. G. Smith, agent for Messrs. Sharp, Harrison & Pocock, Southampton, for plaintiffs; Messrs. Abbott, Jenkins & Abbott, agents for Mr. William Hickman, Southampton, for defendants.

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