Between The Shrewsbury and Birmingham Railway Company, Plaintiffs; and the London and North-Western Railway Company, the Shropshire Union Railways and Canal Company, George Carr Glyn, and William Cowan, Defendants; and between The London and North-Western Railway Company and The Shropshire Union Railways and Canal Company, Plaintiffs; and The Shrewsbury and Hirmingham Railway Company, Defendants
| Jurisdiction | England & Wales |
| Judgment Date | 28 June 1853 |
| Date | 28 June 1853 |
| Court | High Court of Chancery |
English Reports Citation: 43 E.R. 451
BEFORE THE LORDS JUSTICES.
See S. C. (with note) 2 Mac. & G. 324; 3 Mac. & G. 70; 6 H. L. C. 113; 10 E. R, 1237; 16Beav. 441; 22 L. J. Ch. 682; 17 Jur. 845; 1 W. R. 172; 26 L. J. Ch. 482; 3 Jur. N. S. 775; 17 Q. B. Rep. 652.
£115] Between the shrewsbury and birmingham railway company, Plaintiffs; and the london and north-western railway company, the shropshire union railways and canal company, george carr glyn, and william cowan, Defendants; and between the london and north-western railway company and the shropshire union railways and canal company, Plaintiffs; and the shrewsbury and birmingham railway company, Defendants. Before the Lords Justices. May 26, 27, 28, 30, June 1, 28, 1853. [See S. C. (with note) 2 Mac. & G. 324; 3 Mac. & G. 70; 6 H. L. C. 113; 10 E. R, 1237; 16Beav. 441 ; 22 L. J. Ch. 682; 17 Jur. 845; 1 W. R. 172; 26 L. J. Ch. 482; 3 Jur. N. S. 775; 17 Q. B. Rep. 652.] A bill in Parliament to authorize a railway company to grant a lease in perpetuity to another railway company of certain projected lines was opposed by a third railway company, who withdrew their opposition on an agreement being come to that during the continuance of any lease to be authorized by the Act the companies should participate in portions of each other's profits, and that the two former companies should not take traffic on specified portions of their lines. Held, differing from the opinion of Lord Cottenham on a demurrer (2 Mac. & G, 324), that the agreement was ultra vires, and ought not to be decreed to be specifically performed. Held, also, on the construction of the whole agreement, that if valid it would have come into operation, although only a portion of the projected lines was completed. The directors of a railway company are trustees (in an important sense of the word) of their statutory powers, and an agreement entered into by the company amounting to a breach of trust will not be enforced to the prejudice, or not according to the views of all or some of the shareholders, at the instance of parties cognizant of the circumstances. The last of the foregoing propositions is not inconsistent with Haivkes v. Eastern Counties Railway Company, 1 De G. Mac. & G. 737. This was an appeal from the decision of the Master of the Rolls, made on the hearing of the above causes, and on a motion for an injunction which [116] had been òordered to stand over to the hearing of the causes. The case is reported before the Master of the Rolls in the 16th Volume of Mr. Beavan's Reports, p. 441. It is also reported upon the hearing of a demurrer and on a motion for an injunction in 2 Macnaghten & Gordon, 324, and 3 Macnaghten & Gordon, 70, from which reports and the judgments the facts fully appear. Mr. Rolt, Mr. Hardy, and Mr. Giffard supported the appeal, and contended first, that the agreement had come into operation according to the true construction of it 452 SHKEWSBUBY AND BIRMINGHAM RAILWAY CO. V. 4 DB O. M. & 0.117. and of the Act, although the Shropshire Union linea had not been all completed. On this point their arguments were in substance the same as had been successfully urged on the appeal before Lord Cottenham from the decision of the Vice-Chancellor of England, who had allowed a demurrer to the bill. (See 2 Mac. & G. 338.) They also contended that there wa& nothing in the agreement contrary to public policy, or the duty of the directors of the companies, or beyond the powers conferred on the directors by the Companies Acts. They further argued that both these points had been in fact decided by Lord Cottenham. when he overruled the demurrer. the solicitor-general, Mr. Round ell Palmer, Mr. Follett, Mr. W. M. James, and Mr. J. V. Prior, for the London and North-Western Railway Company, contended that the agreement had not come into operation; that it was legally or equitably invalid, as contrary to public policy, and beyond the powers of the directors, [117] a company having no authority to delegate to another any part of ita duties; that, if properly construed, no violation of it had taken place; that the Plaintiffs had so conducted themselves as not to be entitled to ask the interposition of the Court; and that the Plaintiffs had entered into contracts with companies competing with the Defendants of such a kind as to prevent the Plaintiffs from fulfilling their part of the agreement. Mr. Willcock and Mr. Chapman, for the Shropshire Union Railway Company, supported the same view. me. Rait, in reply. The following oases were cited:-Attorney-General v. Wilson (Cr, & Ph. 1), Cohen v. Wilkinson (1 Mac. & G. 481 ; 1 H. & T. 554), Webb v. Direct London and Parts-mouth Railway Company (1 De G. Mac. & G. 521), Lord James Stuart v. London and North-Western Railway Company (Ib. 721), Hawkes v. Eastern Counties Railway Company (Ib. 737), Natusch v. Irving (Gow. on Partnership, App. 398), Great Northern Railway Company v. Eastern Counties Railway Company (9 Hare, 306), East Anglian Railway Company v. Eastern Counties Railway Company (7 Railw. Ca. 150), M'Gregor v. Official Manager of Dover and Deal Railway Company (7 Railw. Ca. 227), Gage v. Newmarket Railway Company (16 Jur, 1136), Simpson v. Denison (10 Hare, 51), South Yorkshire Railway and River Dun Company v. Great Northern Railway Company (3 De G. Mac. & Gor. 576). Judgment reserved. [118] June 28. the lord justice knight bruce. In these appeals I think it convenient first to disembarrass the case of the petition of the cross-Appellants, that, namely, of the London and North-Western Railway Company, who are Defendants in one and Plaintiffs in the other two of the three bills before the Court The two last bills were cross-bills, and were substantially, I agree with the leading counsel of the cross-Appellants in thinking, a defence, effectual or ineffectual, necessary or unnecessary, but still a defence merely against the first bill. If any notion of the possibility of obtaining any relief under both or either of the cross-bills beyond the dismissal of the bill of the original Plaintiffs has at any time existed, it was, as I conceive, utterly unreasonable. Now there is but one order under appeal. It is intituled in the three suits, dismisses all the bills, and refuses to make an order on a motion which came before the Court simultaneously with the hearing of the causes. The earlier petition of appeal, that of the original Plaintiffs, is properly intituled in each of the three. The other petition is intituled only in one, and that the second cause, and appears to complain merely of the dismissal of the earlier cross-bill. The order under appeal notices of course the pleadings in all the causes, notices, the proofs taken in the causes, and I believe all the affidavits and exhibits. The cross-bills having been merely in effect what I have stated, the whole of the bills having been dismissed without costs, the cross-petition of appeal not complaining that the original Plaintiffs' bill was not dismissed with costs, and all the materials in the three causes being materials which would have been open to the full use of the cross-Appellants as Respondents to the original appeal, without the cross-appeal, I can see neither apology nor excuse for the latter; I think, consequently, [119] that the appeal of the cross-Appellants should be dismissed with costs. This leaves, of course, untouched the question of the propriety or impropriety, the merits or dements of the original Plaintiffs' petition of appeal, to which I proceed òIDEO.lift0.110. LONDON AND NORTH-WESTERN RAILWAY CO. 453 to address myself, and the observations that I shall make are to be understood as confined to that petition. Among the various points-some, if not all of them, difficult, some, if not all, of importance-that were raised and discussed during the argument, there are several as to which, considering it unnecessary to express, I do not mean to express any opinion. One of these is the question of the true...
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The Directors, etc. of the Shrewsbury and Birmingham Railway Company v The Directors, etc. of the North-Western Railway Company and of the Shropshire Union Railways and Canal Company
...iv. 653; x. 279, 280; xi. 1484, 1485, 1486, 1488, 1491; xiii. 1765, 1849, 1855. S.C. 26 L.J. Ch. 482; 3 Jur. N.S. 775; and, below, 4 De G. M. and G. 115; 22 L.J. Ch. 682; 17 Jur. 845; 1 W.R. 172. On point as to position of corporate bodies, followed in Taylor v. Chichester, etc. Ry. Co., 18......