Keppell v Bailey

JurisdictionEngland & Wales
Judgment Date29 January 1834
Date29 January 1834
CourtHigh Court of Chancery

English Reports Citation: 39 E.R. 1042

HIGH COURT OF CHANCERY

Keppell
and
Bailey

S. C. Coop. t. Brough., 298; see Limmer Ashphalte Paving Co. v. Commissioners of Inland Revenue, 1872, L. R., 7 Ex., 216; Luker v. Dennis, 1877, 7 Ch. D., 227; Werderman v. Socit Gnrale d' Elctricit, 1881, 19 Ch. D., 252; Earl of Zetland v. Hislop, 1882, 7 App. Cas., 447.

104:2'i C*a** ~" KEPPBLL V. BAILEY 2 MY.' fe K. 817. [517] keppell v. bailey. Jan. 18, 20, 21, 29, 1834. [S. G. Coop. i. Brough., 298; see Limmer Ashpkalte Paving Go. v. Commissioners of Inland Kevemue, 1872, L. E., 7 Ex., 216; Luker v. Dennis, 1877, 7 Ch. D., 227; Werdermm v. SotieU Ge'nerale d' EUctridU, 1881, 19 Ch. D., 252; Earl of Zetland v. Hidap, 1882, 7 App. Gas., 447.] The Monmouthshire Canal Act provided that, upon auxiliary railroads made by private individuals under the authority of the Act, the tolls should not exceed the rate charged by the canal company, which for the articles of limestone and ironstone, was restricted to 2^d. a ton per mile; and it also empowered the canal company, by agreement with the landowners, itself to construct auxiliary railroads, on which tolls not exceeding od. a ton per mile might be charged. Certain landowners and owners of ironworks, and, among others, the lessees of the Beaufort Works, formed a joint stock company, and, under the powers given by the Act, constructed a railroad connecting a lime quarry, called the Trevil Quarry, with the several ironworks and with the railroads of the canal company. In the partnership deed of the railroad company, the lessees of the Beaufort Works covenanted for themselves, their heirs, executors, administrators, and assigns, with the other-shareholders, their executors, administrators, and assigns, so long as the covenantors, their executors, administrators, or assigns should occupy the Beaufort Works, to. procure all the limestone used in the said works from the Trevil Quarry, and to-convey all such limestone, and also all the ironstone from the mines to the said works along the Trevil Railroad, and to pay a toll of 5d. a ton per mile for the-same. Upon a bill filed by the shareholders of the railroad to enforce this covenant against a person who had purchased the Beaufort Works, with notice of the partnership, deed. Held, first, that the covenant did not run with the land so as to bind assignees at law ; and that a Court of Equity would not, by holding the conscience of the purchaser to be affected by the notice, give the covenant a more extensive operation than the law allowed to it; secondly, that the covenant securing a toll of 5d. a ton per mile to the shareholders of the Trevil Railroad, was a fraud upon the canal company and the Legislature, and therefore ought not to be specifically enforced by injunction. Some of the shareholders having been made Co-plaintiffs in the bill without their privity or consent, on their application an order was made, with costs, that their name* should be struck out as Plaintiffs. In the year 1792 an Act of Parliament (32 G. 3, c. 102) was passed, whereby certain persons therein named were incorporated under the name of the Company of Pro-[518]-prietors of the Monmouthshire Canal Navigation, and were empowered to-make several navigable canals, railways, waggonways, and roads, within the district, and in the manner, and subject to the regulations and conditions therein particularly stated and described; and the company were authorised to charge for the conveyance of different kinds of minerals, goods, and merchandise, respectively, along the line of their canals and railways, sums not exceeding a certain scale of tolls specified in the Act. According to that scale it was provided that for all ironstone, iron ore, coal, charcoal, lime, and for all tiles, bricks, limestone, flagstones, and other stone conveyed upon the said canals or railways, a sum not exceeding 2Jd. per ton per mile should be charged; and for all hay, straw, and corn in the straw, and for all materials used in repairing the roads, or for manure, a sum not exceeding 1 Jd. per ton per mile; and for all other articles not before specified, a sum not exceeding 5d. per ton per mile. The Aet also contained a provision, in the 108th section, whereby, as soon as the-company of proprietors were enabled, out of their clear profits, to make a dividend of 10 per cent, among the shareholders upon the capital contributed, certain commissioners were empowered to reduce the rates chargeable for the conveyance of minerals and gooda along the company's canals and railways, according to their discretion. 2 MY. ft K. 619. KEPPELL 1.'. BAILEY 104!? By the 128th section of the Act (commonly known by the name of the eight-mile-clause), it was enacted that, if the owners of any lands containing mines, minerals, or quarries, or the proprietors, lessees, or occupiers of any iron furnaces lying within the distance of eight miles from any part of the said canals or railways, should find it necessary that any railways or roads [519] should he made over the lands of any other persons for the purpose of conveying the produce of their mines or quarries to-the canals or railways of the company, and if the company should refuse to make any such railway or road for the space of three months after an application had been made to them, in writing, for that purpose, at a general meeting of the proprietors- then and as often as such case might happen, the persons who had made such application might, at their own expense, after the expiration of the three months, without the consent of the owners of the lands, make such railways or roads, tendering; satisfaetion for the damage which might be thereby occasioned to the lands, such damage to be ascertained in the manner therein mentioned ; and all such railways or roads, when completed, were to be open to the public for the conveyance of any minerals and goods, on payment to the persons at whose expense the railways or roads had been made, and their heirs or assigns, of such tolls, rates, or duties as should, for the time being, be payable to the Monmouthshire Canal Navigation Company for the conveyance of such minerals and goods upon the railways to be made by them. The canal company was further empowered by the 129th section of the Act, incases where persons might thereafter be desirous to have a railway or waggonway constructed for their use, communicating with the main line of the company's canals-and railways, to enter into an agreement with such persons, and at their request to-construct railways and waggonways accordingly, and to take and demand for the conveyance of ironstone, iron ore, lime, limestone, and other goods and merchandize thereupon, such tolls as should be mutually agreed upon, not exceeding the rate of 5d. per ton per mile. [520] In the year 1795, the proprietors or lessees of three several furnaces and ironworks, viz., William Barrow and Matthew Monkhouse, of the Sorwy or Sirhowy Furnace, Edward Kendall and Jonathan Kendall, of the Beaufort Ironworks, and James Harford and Jeremiah Homfray, of the Ebbw Vale Ironworks, in conjunction with a number of other persons, formed themselves into a joint stock company, for the construction of a railroad called the Trevil Railroad, under the powers given by the 128th section of the Monmouthshire Canal Act. The railroad was accordingly constructed, and the legal estate in it was vested, by a demise for a term of 2000 years, in certain trustees, upon trust for the several shareholders in the railway company, in the proportions to which these had respectively contributed towards the expense of the undertaking. A body of rules and regulations was, at the same time, framed for the government of the shareholders of the railroad as a company; and by an indenture, dated the 16th of August 1795, which was executed by the proprietors of the aforesaid furnaces and ironworks, and by the other subscribers, and in which all these regulations were embodied, it was witnessed that each of the parties thereto, for himself, his heirs, executors, administrators, and assigns, covenanted with the others of them, and their and his executors, administrators, and assigns, mutually and reciprocally, that they, or their respective executors, administrators, or assigns, would remain co-partners, and proprietors of the Trevil Kailroad, and the profits to be divided therefrom, during the continuance of the demise which they had obtained, subject to the conditions and regulations therein specified. The indenture went on to declare that the railroad and the profits thereof should be divided into fifty-five shares, which should be vested in the parties thereto and their [521] respective executors, administrators, and assigns, for their respective use and benefit, in proportion to the sums of money subscribed by them respectively; and it then specified the number and particulars of the shares allotted to the several subscribers, of which shares the five respectively numbered from 7 to 11 inclusive were stated to belong to Edward Kendall and. Jonathan Kendall, their executors, administrators, and assigns, as joint-tenants. The indenture proceeded to recite, that the proprietors of the iron furnaces,, parties thereto, necessarily made use of great quantities of limestone in their furnaces, which for a long time past they had procured from a quarry called the Trevil Quarry, 1044 KEPPELL V. BAILEY 2 MY. * K. 523. .and carried to their furnaces at a great expense, for the more convenient carriage of which the Trevil Railroad was chiefly intended, and that it was in consideration of the quantity of limestone which would be carried upon the said railroad for the use of the furnaces, and of the quantity of ironstone which would also be carried upon the railroad, that the other parties became subscribers to the undertaking; and that at the time of the subscription, it was understood that the said proprietors of the -furnaces would respectively...

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