HC Deb 22 March 1826 vol 15 cc76-81
Mr. Peter Moore

brought up the report of the committee upon this bill. On moving, that the amendments be now read,

Mr. Littleton

said, he had a few observations to offer upon this bill. It purposed, as he perceived, to enable the Welch Iron and Coal Company, to sue and be sued in the name of their Secretary. Now, he thought the House should recollect, that if they gave this bill their consent, they at the same time granted a kind of parliamentary sanction and authority to the purposes for which the company had been formed, and to the manner in which they proposed to carry their intentions into execution. Now, as he did not conceive that the House meant to give any such sanction or approbation to the companies which had been applying in this manner for the powers of an act of parliament, he thought the present a very fit opportunity to check such applications in future. He drew a very great distinction between companies formed to do what nothing but great companies could do—such as working the mines containing precious minerals in other countries, and various other undertakings, which required the hazard of immense capital, without the fear of great individual loss—and those companies which were created for undertakings of a mere ordinary description, and which were likely to prove ruinously injurious by competition with meritorious individuals, whose properties were invested in those branches of trade to which they proposed to apply their joint-stock capital and powers. Some of his constituents fearing such consequences from this company, and feeling they could prove it was not likely to be productive of any of the advantages, either to particular districts, or to the country at large, which it promised, had incurred a very serious expense last session in opposing the bill in the committee, and he, finding that the hon. member who was endeavouring to carry it through the House this session, and who had chiefly interested himself in its success, was never, on any occasion, present at that committee, and that there was no probability of the bill being brought in in that session, came down to the House and moved, "That the order for the committee be discharged," and it was discharged accordingly. Seeing no better reasons for the bill this year than he had been able to discover last year, he would now move, "That instead of the amendments being read now, they should be read upon that day six months."

Mr. Peter Moore,

after explaining the reason for the postponement of the bill, and his absence from the committee, observed that he hoped to be able so to convince the hon. member for Staffordshire of the propriety and importance of the bill, as to induce him to withdraw his opposition to it. The company had purchased mines at a cost of 100,000l.; they had expended 100,000l. more in machinery and preparations for working them; and they would probably lay out 2 or 300,000l. more in the progress of their operations. They had incurred debts, and they had debtors; and it was for the purpose of legalising their actions, so as to protect the property they had invested already, as well as to secure the public in all their future contracts, that they now applied for leave to sue and to be sued. In the present state of the law, no man could recover any sum, however small, from the company, without filing a bill in Chancery, containing the names of all the directors, officers, and proprietors; and if any one of them should happen to die before a decision was pronounced, the whole of the proceedings must be commenced anew, with the same formalities. The bill, therefore, was not more a security to the proprietors than an accommodation to the public; and as there had not been a more respectable body of men associated together for half a century, he trusted the hon. member would see the propriety of withdrawing his opposition.

Colonel Wood

hoped, that his hon. friend would not be induced to relax in his opposition to the bill. Every body who knew the mining counties of Wales, knew that this company was not at all necessary. Instead of there not being enough, there was too much iron there, and the great evil of this bill would be, that it would increase the competition to a mischievous extent.

Colonel Davies

said, that the reasons given by the two hon. members for their opposition was very extraordinary. They alleged no public grounds. They did not say that it was likely to prove delusive, but they only alleged that it would be opposed to the interests of the iron-masters with whom they were connected, in that part of the country where the bill would be carried into operation. He could not understand why, if such a company were to exist, their creditors was to be deprived of the power which it was now proposed to give them in all legal proceedings; since it was clear that if they had not that power, they would be without any adequate remedy.

Mr. Stuart Wortley

said, his objection to the bill was, that it gave the sanction of parliament to a company only for the purpose of enabling them to come into the market upon better terms than other persons. Every allegation in the preamble of the bill was false. It alleged, that the prosperity of Wales had been solely owing to mining companies of this sort, which he denied; and he would refuse, therefore, to put them upon a better footing than other individuals.

Mr. Calcraft

said, that the object of the bill was to raise the price of the company's shares in the market, and not to benefit Wales, or the iron trade. He had always stood up for individuals embarked in trade, against these overwhelming efforts of capital, and he would do so on this occasion. The object of the bill was, he repeated to give additional value to the shares, that they might become objects of gambling speculation.

Mr. Baring

was afraid that the House was inclined to proceed too hastily on the subject. Last year they passed all bills relating to companies of the most trumpery description, and now they seemed indisposed to pass any which was at all connected with a company. It became the House to be more consistent with their legislation. They ought to decide upon a general principle, and not with reference to the merits of particular companies. It was true that the sanction of parliament was, in some instances, sought for the purpose of giving facility to the circulation of shares, and of catching the unwary; but it should be understood, that although parliament should pass a bill to facilitate the operations of the company, and to free it from the inconveniences to which it might be otherwise legally subjected, it by no means pledged itself to an approval of the enterprise in favour of which the bill was required.

Lord Palmerston

concurred in the opinion, that the passing of the bill in par- liament by no means gave a sanction to the objects which the bill proposed to carry into effect. It was only intended by parliament to remedy the imperfections of the law, which would otherwise subject the partners of those companies to great delay and difficulties. A difference should be made between companies which were not proceeded in, and which deserved to be denominated wild speculations, and those which had an actual existence, and on which the shares were either paid, or likely to be paid up.

The Chancellor of the Exchequer

said, that he knew nothing of the particular company, the bill in favour of which was now before the House. Whether it would be beneficial or not to the principality of Wales, he would not say; but he thought it would have been well, if the parties, before they applied to parliament, had availed themselves of a bill which passed towards the close of the last session. He alluded to an act empowering the king in council to grant limited charters. An opportunity would have then presented itself of discussing the grounds on which this company sought the relief required by this bill. The House had first a right to inquire if the allegations of the parties requiring this relief were true; and, secondly, if true, why they had not first adopted the easy course of applying for the limited charter, which, by the act of last session, the Crown had the power to grant?

Lord A. Hamilton

said, that joint-stock companies came to that House to obtain bills of the nature of that before the House, in order to gain a character out of doors, and to enable them to sell their shares to advantage. The House ought to proceed with extreme caution on the subject, after the dishonest practices which had been committed by many of the companies who obtained charters last year.

Mr. Huskisson

said, he was not aware that any notorious bubble companies had obtained sanction from that House. The number of applications made last year for acts of parliament, on the part of joint-stock companies, first called the attention of the House to the subject, and they almost came to a resolution not to entertain, as a matter of course, an application from any number of persons associated in partnership for permission to sue and be sued through their secretary. Towards the close of last year, parliament made an alteration in the act of Geo. 1st, the effect of which was to enable the Crown to grant limited charters to joint-stock companies. When that legislative measure was adopted, the fever of speculation had abated, but was not altogether subsided. A great number of applications were made to the king in council for charters. Whilst those applications were under consideration, many of them were withdrawn, and he believed that the parties who had withdrawn them, were now very glad that they had not been put to the expense of procuring a charter. The company to which the present bill referred was instituted, he understood, for the purpose of working mines and minerals in Wales. One of the applications made to the privy council for a charter was by a company for working mines and minerals in Scotland, and the application was backed by the recommendation of the first people in Scotland. He was one of those who did not think it proper to advise the Crown to grant any privilege to a company which, by the general description of their object, might work any thing from a slate-quarry to a gold mine, if they could find any. The application of the Scotch company was therefore rejected. In acceding to such applications, it was necessary to exercise great circumspection, as he remembered last year the effect of sanctioning the formation of so many companies to work mines, was to raise the demand for wages, and to encourage combinations among the workmen throughout Staffordshire, and the other mining districts. The House should therefore be slow and jealous in giving countenance to these schemes; and he could not forbear from thinking, that this application would be more likely to be fairly entertained, and an impartial decision formed upon it, by hearing council before the privy council, than by having the preamble of the bill read in that House. He would avail himself of that opportunity of stating his anxiety, that the law of partnerships, in which applications of this kind were mainly concerned, and which was in many instances the ground of making them, should undergo some material alteration. The law upon this subject was extremely inconvenient and defective; and he should be most happy to see the alteration and improvement of it undertaken by some person more competent than himself to such a task. What could be more inconvenient than, in pro- ceeding against a company, if any member of the partnership were absent, the proceeding must be staid until a writ of outlawry was executed against the absent person, and the execution of it sometimes occupied a twelvemonth. Whilst this writ was executing, another member of the partnership might be absent, and it would be necessary to adopt a similar legal course respecting him. Then it was necessary that the names of all the partners should be entered in the proceedings; and if the christian name of any of the parties was wrongly inserted, or he was otherwise improperly described, a plea of abatement was entered up, and the plaintiff must abide the issue of that plea, before he could take any further step. If the issue were against him, he would be obliged to bear all the foregoing expenses, to which, in prosecuting his suit, he had been liable, and to begin de novo. Many other inconveniences attended the present law, which he would be most happy to see remedied. Besides, great difficulty often presented itself in ascertaining who were all the partners, as this could only be ascertained from the partners themselves, who were also defendants, and who could not therefore give testimony in the case. Whether this could be remedied by having a registry of the number of partnerships, or whether in actions of this kind it would not suffice to have an action brought against a member of a partnership, and oblige the other members to abide the result, he was not at that moment prepared to say; but the interests of commerce and manufactures, and a due protection of the interests of the public, materially required an amendment of the law of partnerships.

The amendment was agreed to, and the further consideration of the report put off for six months.