Maunsell v Midland Great Western Ireland Railway Company
| Jurisdiction | England & Wales |
| Judgment Date | 04 June 1863 |
| Date | 04 June 1863 |
| Court | High Court of Chancery |
English Reports Citation: 71 E.R. 58
HIGH COURT OF CHANCERY.
S. C. 32 L. J. Ch. 513; 9 Jur. (N. S) 660; 8 L. T. 826; 11 W. R. 768. See Taylor v. Chichester and Midhurst Railway Company, 1867-70, L. R. 2 Ex. 380; L. R. 4 H. L. 628; London and Blackwall Railway Company v. Cross, 1886, 31 Ch. D. 368; Kitts v. Moore [1895], 1 Q. B. 260.
Railway Company. Agreement. Ultra Vires.
58 MAUNSELL V. MIDLAND GREAT WESTERN 1H.&M.130. [130] maunsell v. midland great western (ireland) railway company. Feb. 27, June 4, 1863. [S. C. 32 L. J. Ch. 513; 9 Jur. (N. S.) 660; 8 L. T. 826; 11 W. E. 768. See Taylor v. Chiehester and Midhurst Railway Company, 1867-70, L. R. 2 Ex. 380; L. R. 4 H. L. 628; London and Blackmail Railway Company v. Cross, 1886, 31 Ch. D. 368; Kills v. Moore [1895], 1 Q. B. 260.] Railway Company. Agreement. Ultra Vires. Where an agreement made between two railway companies under their common seals contains clauses which are beyond the powers of the directors of one of the companies, and clauses for referring to arbitration all disputes arising under the agreement, this Court will, at the suit of a shareholder of that company, restrain both companies from proceeding to arbitration in respect of alleged breaches of those clauses. But no such injunction will be granted at the suit of a shareholder of the other company, on the ground that the stipulations of any such clause are beyond the powers of the directors of the company in which the Plaintiff is not a shareholder. An agreement by a railway company to contribute towards the Parliamentary deposit required for bills promoted by another company is ultra vires. So also is an agreement to take shares in future extensions of another company. So also an agreement to make traffic regulations applicable to future extensions. But no such agreement is ultra vires if its validity is expressly made to depend on the sanction of Parliament. This was a bill by certain shareholders in the Midland Great Western (Ireland) Railway Company, on behalf of themselves and all other the shareholders in the company, against the company and the directors thereof (other [131] than the Plaintiff, Maunsell) and the Great Northern and Western (Ireland) Railway Company, praying for an injunction to restrain the Defendants from acting on the agreement mentioned in the bill so far as regarded the clauses therein specified, and in particular from proceeding with the reference hereinafter mentioned, and from in any other way proceeding upon or acting under the notice of the 13th January 1863 hereinafter set forth. The material circumstances were as follows :- The Midland Great Western (Ireland) Railway Company (hereinafter called the Midland Company) were incorporated bv Act of Parliament in 1845 for the purpose of making a railway, which, on the 1st August 1859, extended from Dublin through Athlone to Galway. The Plaintiffs were shareholders in this company, holding shares to the value of 37,000 or thereabouts. The Great Northern and Western (Ireland) Railway Company (hereinafter called the North-Western Company) were incorporated by Act of Parliament in 1857 for the purpose of making a railway, commencing by a junction with the Midland Railway at Athlone, and terminating at Roscommon, and another railway thence to-Castlereagh, to be called "The Great Northern and Western (Ireland) Railway." Other Acts of Parliament were subsequently passed, empowering the said North-Weatern Company to make other railways in extension of arid in connection with the said North-Western Company. One of these Acts was passed in 1858, and authorised certain deviations; another was passed in 1859, and authorised an extension of the railway to Castlebar; another in 1860, authorising certain deviations ; another in 1861, authorising an extension to [132] Westport; and finally, another in 1862, authorising an extension to Ballina. The Acts of 1859, 1861 and 1862 are hereinafter referred to as the Castlebar, Westport and Ballina Extension Acts respectively. By the 46th section of the Act of 1857 it is enacted that it should be lawful for the North-Western Company and the Midland Company from time to time to enter ih. &M.133. (ireland) railway company 59 into and make such contracts and agreements as should be deemed expedient by and between the said companies for and with reference to the working of the traffic upon the railway by that Act authorised, or any part thereof, with the engines and carriages of the Midland Company, and for the interchange and forwarding of traffic passing to and from the railway of the companies, or either of them, from or to the railway of the other of them ; and also with reference to the rates, tolls or charges to be charged by or between the said companies for or in respect of any traffic, and the division and apportionment between the said companies of such rates, tolls and charges; and auch contracts and agreements from time to time to alter and vary as occasion might require; and also, for all or any of the purposes aforesaid, to make and execute all such deeds, contracts, instruments and assurances as might be deemed requisite or expedient for giving to the matters and premises aforesaid full effect. And by section 47 it was enacted that, during the continuance of any such traffic arrangements, the railways of the two companies should, for the purpose of calculating the tolls payable thereon, be deemed one continuous line of railway. And by section 48 it was enacted that no such agreement as aforesaid should be for more than ten years, and no such agreement should have any operation until the same should have been approved of by the Board of Trade; and that no such agreement should in any manner alter, affect, [133] increase or diminish any of the rates, tolls or charges which the said companies should for the time being be respectively authorised and entitled to demand and receive from any person or any other company ; and that all other persons and companies should, notwithstanding any such agreement, be entitled to the use and benefit of the railways to which the said agreement might relate, upon the said terms and conditions, and on payment of the aame tolls, rates and charges as they would have been in case no such agreement had been entered into ; and it was thereby provided that the Board of Trade should not approve any such agreement without being satisfied that the same had been duly assented to by shareholders of the companies respectively in special meetings assembled for that purpose, and holding at least three-fifths of the paid-up capital of the companies represented at such meetings respectively, personally or by proxy, such shareholders being qualified to vote thereat in right of such capital. And section 49 provided for the renewal of the said agreement in such manner as therein mentioned. By the 13th and certain following clauses of the North-Western Railway Act of 1858 the Midland Company were authorised to become shareholders in the North-Western Company to any extent not exceeding 80,000 (being one-third of the then authorised capital of the North-Western Company), and to appoint one-third of the directors of the last-mentioned company. And by the 21st clause of this Act it was enacted that the agreements sanctioned by clause 46 of the Act of 1857 might comprise (amongst other things)- The user and working by the Midland Company of all or any part of the railways of the North-Western Company, and the works and conveniences belonging thereto. The conveyance by the Midland Company of all or any part of the traffic upon these railways, [134] The division and apportionment between the two companies of all or any part of the gross or net receipts from the traffic upon their respective railways. The forwarding, interchange and transmission upon the respective railways of the two companies of any traffic. The collection, reception, accommodation, delivery and general conduct of any such traffic. By the 22d section of this Act power was given to the two companies to appoint a joint committee of directors for carrying any such traffic arrangement into effect. And by section 23 it was enacted that such contracts might be entered into for such period as the two companies should think fit; provided that if at the end of ten years after the date of any such contract or agreement, or after the time of any revision thereof under that provision, the Board of Trade should think that any of the terms and conditions thereof injuriously affected public interests, they might require the two companies to revise the contract or agreement accordingly. 60 MAUNSELL V. MIDLAND GREAT WESTERN 1H.&M. 138. In pursuance of the powers given them by the said Act, the Midland Company duly took up one-third of the then authorised shares of the North-Western Company. On the 1st of August 1859 an agreement was come to by the directors of the two companies, and sealed in duplicate with the common seals of both companies ; by which, after reciting various mutual oppositions in Parliament, and that such oppositions had been compromised, and that the arrangement for compromise had been up to that time duly carried out, a number of provisions for the purpose of settling the through traffic and for other purposes were agreed to by and on behalf of both companies. The material clauses of this agreement were the following :- [135] "Article 1. John Hawkshaw, of Great George Street, Westminster, civil engineer, or if he dies or becomes incapacitated, or if and when he declines or by reason of absence is unable to act, a competent and impartial civil engineer to be from time to time named by the respective engineers of the two companies, or if and when they do not agree thereon, then a competent and impartial civil engineer to be, on the application of the two companies or either of them, named by the Board of Trade, shall be the referee for the...
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Bremer Vulkan Schiffbau und Maschinenfabrik v South India Shipping Corporation Ltd
...where one party brings an action impeaching the supposed arbitration agreement, saying that there was no binding agreement - see Maunsell v. Midland Railway Co. (1843) 1 H. & M. 130; Kitts v. Moore (1895) 1 Queen's Bench 253. Second, where the arbitrator has done something or other which sh......