Sir William Baillie, Bart, and Others, - Appellants; The Edinburgh Oil Gas Light Company, - Respondents
| Jurisdiction | Scotland |
| Judgment Date | 01 January 1835 |
| Date | 01 January 1835 |
| Court | Court of Session |
English Reports Citation: 6 E.R. 1577
FROM THE COURT OF SESSION.
Mews' dig. I. 560, 649, 705; iii. 1401, 1402, 1870.
BAILLIE .V. EDINBURGH OIL GAS LIGHT CO. [1835] III CLARK & FINNELLY, [639] APPEAL from the court of session. Sir WILLIAM BAILLIE, Bart., and Others,-Appellants; The EDINBURGH OIL GAS LIGHT COMPANY,-Respondents. [Mews' Dig. i. 560, 649, 705; iii. 1401, 1402, 1870.] By Act of Parliament, authorising a joint-stock company to raise £80,000 in shares of £25 each, the directors were empowered to make such calls for money on the subscribers to the undertaking as they should from, time to time find necessary for the purpose of carrying on the same, but no such call should exceed £10 per cent., and one month at least should intervene between the calls. The directors brought a,n action against one of the subscribers for the amount of twoi calls made on his shares, on the same day, and that subscriber brought a counter action against the directors for the value of his shares as at a certain period, on the ground that they had, without his consent, engaged in specular tions foreign to the company's undertaking, and at last abandoned that undertaking and united themselves with another company. Both actions were referred to an arbitrator under an order of Court; and he found, first, that the directors were entitled to decree for the amount of the two calls, with interest; secondly, that the subscriber was entitled to decree for a certain sum as the ascertained price of his shares, which sum, under deduction of what was awarded for the calls, he was entitled to recover from the company on surrendering or transferring his shares to them, or to any person they might direct; and he further found thai] the directors! were entitled to reservation of any claim they might have against the subscriber for calls made subsequent to their action, and that the subscriber was entitled to reservation of his defences against such claims. Held by the House of Lords that the award was bad, inas-[640]-much as the first finding for the amount of two calls made in one day was contrary to the Act of Incorporation, which required the distance of a, month at least between two calls, and the second finding was not final and conclusive, but held the subscriber entitled to recover the sum awarded to him upon condition only of transferring his shares. Semble, the third finding, reserving subsequent claims of one party and defences of the other thereto, was not bad (though unnecessary), inasmuch as a reference of " all questions between the parties," by the practice in Scotland, is confined to the questions in the particular actions referred. There are here two appeals at the instance of the same Appellants and Respondents (see the report, 10 Shaw, D. and B. 723). The interlocutors complained of were pronounced partly in an action raised by the Respondents against Mr. Clynei, solicitor in the supreme Courts in Scotland, for payment of the sum of £260 with interest, being the amount of two instalments alleged to- be payable on fifty-two shares of the capital stock of " The Edinburgh Oil Gas Light Company," held by him. That company was incorporated in the year 1824, by an Act 5 Geo. 4, c. 76, intituled " An Act for the better lighting the City and Suburbs of Edinburgh with Oil Gas;" by the 12th section of which, the company was authorised to raise £80,000 in 3200 shares of £25 each share. By the 52d section it was enacted, " That the committee of manage ment shall have full power and authority, from time to timei, at any of their meetings aforesaid, to' make such call or calls for money from the several subscribers to- and proprietors of the said undertaking in order to defray the expenses of or of carrying on the same, as they shall from time to time find wanting and necessary for [641] these purposes, until the sums subscribed are fully paid ; but no such call shall exceed the sum of £10 per centum, for or in respect of every share in the said undertaking, and so that no such calls be made but at the distance of one calendar month at least from each other, and so that fourteen days' previous notice at least shall be given of every such call, etc." And it was provided by the 71st section, " That nothing in H.L. vi. 1577 50a Ill CLARK & FINNELLY. BAILLIE V. EDINBURGH OIL GAS LIGHT CO. [1835] this Act shall extend or be construed to extend to authorise, nor shall it be lawful for the said company to manufacture or produce gas or inflammable air, or the products obtained in the process of making gas or inflammable air, from pit coal, cannel coal, or coal of any other species," On the 12th of December 1825, the committee of management made two calls on the proprietors, each being for £2 10s. per share, payable respectively on the 10th January and 13th February 1826. These were the fifth and sixth calls, and the sums thus demanded on Mr. Clyne by these two calls, in respect of his shares, amounted to £260. On his refusing to pay that sum the directors of the company brought a.n action against him in January 1827. Defences were given in for Mr. Clyne, in the month of November of the same year, to this effect:-That the calls in question were not made for the .necessary purposes authorised by the Act of incorporation; that had the managers of the company confined their operations to what was authorised by that Act, no' call would have been necessary after June 1825, as wa.s stated at the annual meeting then held; and that if speculations had been gone into, and measures adopted which were not authorised by the Act, the expense of all such proceedings should be defrayed by those with whom they originated, but could not [642] be charged against such members of the company as did not concur in them. It was in conclusion averred, that the calls now made had been occasioned solely by objects and pursuits not authorised by the Act, and which had no concern with the original object and proper business of the company. While this action was depending the company resolved to abandon, the manufacture of oil gas, and an offer having been made by the Edinburgh Coal Ga,s Company for purchasing their works and pipes, an agreement was entered into in March 1828, whereby the whole property belonging to' the Oil Gas Company, except the sums diue for calls on the proprietors and accounts due by customers, was sold to the Coal Gas Company for 1000 shares of the latter company's stock, to be distributed among the proprietors of the Oil Gas Company, in proportion to the shares of the stock of that company, held by them respectively at the time of the agreement. Subsequently to these transactions, Mr. Clyne raised a counter action for damages against the Respondents, alleging that by various proceedings taken by them as directors of the company, and which he particularly stated in his summons, they had violated the said Act of Parliament, and also the original conditions upon which he became a shareholder of the company's stock; and that having so acted, and having sold the property of the company without his consent, they were bound to repay unto him all that he had paid for his shares in deposits, premiums, and calls or instalments (of which he had paid four) with interest. The summons concluded for payment of £1183 10s. 5£d. To this action the Respondents gave in defences to this effect: -That Mr. Clyne was barred by acqui-[643]-escence from questioning the proceedings1, on. which he libelled, as grounds of action against them: That under the circumstances in which the affairs of the company were placed at the time of their agreement with the Coal Gas Company, they were legally entitled to dissolve the Oil Gas Company, to dispose of their property, and to divide the proceeds rateably among the proprietors; and these measures having been effected in the way most beneficial for the shareholders at large, it afforded no relevant ground of action against the Respondents, that they were not consented to' by an individual proprietor of stock: and that Mr. Clyne sustained no loss from the proceedings in question, but, on the contrary, had been greatly benefited thereby, and therefore his claim of repetition and damages was altogether unfounded. This action was ordered by the Lord Ordinary to' be remitted to' the former action, but not conjoined with it; and some of the interlocutors complained of in the appeals were pronounced in them on the 30th of November 1830, and the 24th of May and 1st of June 1831. In pursuance of his Lordship's interlocutor of the last date, the following issues were proposed to be tried by a, jury.-Issue in the cause in which the Edinburgh Oil Gaslight Company are Pursuers; and David Clyne, solicitor in the Supreme Courts, is Defender.-" It being admitted that by an Act of Parliament, 5 Geo. 4, c. 76, a company was established in Edinburgh, under the name of the Edinburgh Oil Gaslight Company, for the purpose of manufacturing gas from oil and other substances: 1578 BAILLIE V. EDINBURGH OIL GAS LIGHT CO. [1835] III CLARK & FINNELLY. " It being also admitted that the defender was proprietor of fifty-two shares of the stock of the said company, during the months of January and February 1826 ;- [644] " Whether the defender is indebted and resting-owing to the pursuers in the sum of £130 sterling, or any part...
To continue reading
Request your trial