Daniel Byth Haddon against Stephen Hawes Ayers, Edmund Isham Brietzcke, John Bampfylde Daniell, Thomas Charles Simmons, Thomas Smith and Francis Freeman Statham
| Jurisdiction | England & Wales |
| Judgment Date | 12 November 1858 |
| Date | 12 November 1858 |
| Court | High Court |
English Reports Citation: 120 E.R. 853
IN THE COURT OF QUEEN'S BENCH AND EXCHEQUER CHAMBER
S. C. 28 L. J. Q. B. 105; 5 Jur. N. S. 408.
1 BL. fc EL. Ill HADDON V. AYERS 853 [118] daniel byth haddon against stephen hawes ayers, edmund isham bbietzcke, john bampfylde daniell, thomas charles simmons, thomas smith and francis freeman statham. Friday, November 12th, 1858. A joint stock life insurance Company completely registered under stat. 7 & 8 Viet, c. 110, had thirteen directors. A difference having arisen among the directors as to the management, it was, by indenture between six directors of the first part and five of the second, recited that the parties of the second part were desirous of retiring from the direction, and would, upon the execution of the indenture, cease to be directors; and that it had been agreed that they should give up all their interest as directors, shareholders or otherwise (with an exception not material), on the terms after stated; and that the parties of the first part would immediately cause to be transferred into their own name the shares held by the parties of the second part, and no fresh shares should be issued till these shares had been transferred to other parties applying for shares: and the indenture witnessed that, in consideration of the premises and of the after mentioned covenant and release on the part of the parties of the first part, the parties of the second part, "and each and every of them," did release " to and in favour of the said Associa tion" all their interests in the Association, and the funds and effects thereof (except as before). And, in consideration of the premises and of such release, the parties of the first part did, for themselves, their heirs, executors and administrators, "covenant, promise and agree with and to the parties of the second part, their executors, administrators and assigns, that they" would cause the shares held by the parties of the second part to be transferred into the names of the parties of the first part, and that the Association should not issue fresh shares till these shares had been transferred to other parties applying for shares, and would cause the transfer of the shares to be duly registered, pursuant to the provisions of the Joint Stock Companies .Registration Act for the protection of retiring shareholders, and should and would do and perform all such other acts as might be necessary for giving the parties of the second part the advantages afforded by the Joint Stock Companies Registration Act, for terminating their liability, and for carrying out the arrangement, and pay the parties of the second part such moneys as they should have properly expended on account of the Association, and produce proof that all debts of the Association up to the Christmas preceding the ageeement had been paid : " and shall and will, at their own costs and charges, henceforth and at all times hereafter, well and effectually save harmless and keep indemnified the said parties hereto of the second part, their executors, administrators and assigns, their estates and effects of, from and against all and all manner of actions, suits, payments, losses, costs, charges, damages, claims and demands whatsoever, which shall or may be commenced or prosecuted against, or paid, incurred, borne, sustained or made by, the said parties hereto of the second part, their executors, administrators or assigns, by or in respect of the said " " Association, or the shares or policies thereof, or by reason or on account of any other cause, matter or thing whatever in any wise relating to the premises."-It was, previously to the execution of the indenture, understood that the money to be paid by the retiring directors was to come from the private funds of the directors not retiring. The Company before and at the time of the execution, owed somewhat more than their funds covered; and the shares were not saleable. At the time of the execution, the retiring directors were in fact paid for their shares by money raised by the Company, the retiring directors taking no part in the raising such money; and they thereupon transferred their shares to the directors not retiring (the name of one only of these transferees appearing in the register, as provided for by the Company's deed of settlement). The shares so transferred were reissued before any others, and the purchase money paid to the account of the Company. The Company was afterwards wound up; and one of the parties of the second part was made liable as a contributory, and compelled to pay calls, and to refund the money he had received for his shares. He thereupon, in his single name, sued the six parties of the first part jointly on the covenant to indemnify.-Held, that the action was maintainable and the plaintiff entitled to recover all he had been compelled to pay and refund. For that:--First, the agreement was legal, as between the parties, since it could 854 HADDON V. AYERS 1 EL. & EL. 119. not bind any others, unless the Company chose, at a general meeting, to adopt it and the defendants, who had undertaken to do all necessary for carrying the undertaking into effect, were not entitled to object that there had been no such adoption.-Secondly, the action was well brought by the plaintiff singly; the words of the covenant admitting of its being construed as made with tho covenautees severally, and their interests being several. [S. C. 28 L. .1. Q. B. 105; 5 Jur. N. S. 408.] The declaration alleged that, on 18th March 1854, a deed was executed by and between the plaintiff, [119] James Hutt, Joseph Ketley, William Munt and Algernon Sidney Vandenbergh, and the defendants, who respectively were and are the same persons as those whose names are mentioned in the said deed, the tenor whereof was and ia as follows: that is to say : " Articles of agreement, made and entered into this 18th day of March 1854, between Stephen Hawes Ayers, of" &c., "Edmund Isham Brietzcke, of" &c., "John Bampfylde Daniel], of" &c., "Thomas Charles Simmons, of" &c., "Thomas Smith, of" &c., "and the .Reverend Francis Freeman Stathatn, of" &c., beiug six of the present directors of The Universal Provident Life Association, of the first part, and Daniel Byth Haddon, of " &c., "James Hutt, of " &c., " The Eeverend Joseph Ketley, of "&c., " William Munt, of" &c., "and Algernon Sidney Vaudenbergh, of" &c., being five other of the directors of the said Universal Provident Life Association, of the second part. Whereas the said parties hereto of the second part are desirous of retiring from the direction of the said Association, and will, upon the execution hereof, cease to be such directors ; and whereas it has been agreed, by and between the said parties hereto of the first and second parts, that the said parties hereto of the second part shall give up, release and abandon all interest [120] which they may now possess therein, whether as directors, shareholders or otherwise, save as hereinafter excepted as policy holders, upon the terms and conditions after stated ; and whereas it has been further agreed that the said parties hereto of the first part shall and will immediately cause all the shares held by the said parties hereto of the second part to be transferred in the usual manner into the names of the several parties hereto of the first part, and that no further, fresh or other shares shall be allotted or issued by the said Association to any other persons applying for the same until the shares now agreed to be transferred to the parties hereto of the first part shall have been retrans-ferred by them into the names of other parties applying for shares in the said Association : Now these presents witness, and it is hereby declared and agreed, by and between the said parties hereto of the first and second parts, that, in consideration of the premises and of the covenant and release hereinafter contained on the part of the said parties hereto of the first part, they the said parties hereto of the second part, and each and every of them, do hereby relinquish and release to and in favour of the said Association all their rights and interests in the said Association and the funds and effects thereof, except as to policies as hereinafter provided for. And, in consideration of the premises and of such relinquishment and release by the said parties hereto of the second part, they the said parties hereto of the first part do, for themselves, their heirs, executors and administrators, covenant, promise and agree with and to the said parties hereto of the second part, their executors, administrators and assigns, that they, the said parties hereto of the first part, shall and will, at or immediately after the execution [121] of these presents, cause all the shares held by the said parties hereto of the second part to be transferred in the usual manner into the names of the parties hereto of the first part; and that the said Association shall not nor will issue any fresh or other shares until such shares shall have been retransferred into the names of other parties; and also shall and will cause the transfer of such shares to be duly registered under the Joint Stock Companies .Registration Act, pursuant to the provision of the said Act, for the protection of retiring shareholders ; and shall and will do and perform all such other acts as may be necessary, as well for the purpose of giving the parties hereto of the second part all the advantages afforded by the Joint Stock Companies Registration Act for terminating their liabilities, as for the purpose of carrying out the said arrangement; and further shall and will pay unto the said parties hereto of the second part, their executors, administrators or assigns a due and proper proportion of all such sum or sums of money as they, the said parties...
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