§ MR. HUDSON* rose, pursuant to the Notice he had given, for the purpose of moving that the following Clause should be inserted in all Railway Bills of the pro-sent Session, by which new companies are to be incorporated:—
And be it enacted, that the directors shall, within three months of the passing of this Act, cause the names and additions of all the several corporations and persons entitled to shares in the company, to be entered in the 'Register of Shareholders,' directed to be kept by 'the Companies Clauses Consolidation Act, 1845;' and the said directors shall cause an extraordinary meeting of the shareholders in the company to be called within six months from the passing of this Act, for the purpose of considering and determining whether the company shall proceed in the execution of the powers of this Act, or whether such company shall be forthwith dissolved; and it shall be lawful for such meeting so called, at which three-fifths at least of such shareholders shall be present, either personally or by proxy, to determine either that the company shall proceed in the execution of the powers of this Act, or that the company shall be forthwith dissolved; provided that before such meeting be called, it shall not be lawful for the company or the directors to put in force any of the powers of this Act relative to the taking or using of land; and in case such meeting so called shall determine that the company be forthwith dissolved, the company shall be thereupon forthwith dissolved accordingly, except for the purpose of winding up the affairs thereof as hereinafter mentioned; and thenceforth all the powers of this Act with relation to the taking or using of land, or otherwise, shall absolutely cease and determine, anything herein contained to the contrary notwithstanding (subject, and without prejudice to all existing debts, liabilities, or agreements contracted or entered into by the company, and subject to the provisions hereinafter contained); and the directors, after full payment and satisfaction, in the first instance, of all the debts, liabilities, and agreements contracted or entered into by the company, and of such compensation as hereby provided, shall divide the residue or surplus of the moneys and effects of or belonging to the said company, rateably among the shareholders in the said company in proportion to their respective interests therein; provided, nevertheless, that the company shall make full compensation to all owners, lessees, and occupiers of land and others, in the same manner as is herein provided in cases of compensation for land required for the purposes of this Act, for all loss, damage, cost, charges, and expenses which they may respectively have sustained or been put unto in consequence of the proceedings of the company in obtaining this Act, or under any of the powers thereof; the amount to be ascertained, in case of dispute, by the verdictIn moving the adoption of that clause, the hon. Gentleman said that at the time he had first given notice of it, he was not aware of the intentions of the Government with regard to the steps that had since been adopted by them in reference to the winding up of railway companies; but upon a careful consideration of the Resolutions adopted by the House, he was still of opinion that the clause he then proposed was wanting. He must observe that be-fore the deed could have effect, it should be signed by shareholders for the full amount of the estimated capital, so that it was even still in the power of the directors of any company to avoid putting the Act in force after it should have been obtained, by not allowing it to be completed. But the effect of his clause would be to compel the completion of the registration of shareholders, and thereby give to those parties who had signed the deed an opportunity of getting rid, if they should so think fit, of the liabilities to which they had thereby subjected themselves. The Resolutions passed by the House already had not provided for the class to which he referred. They had merely provided power for the scripholders to meet and decide whether they would or would not proceed with the undertaking. But the House should recollect that the scripholders might pass resolutions empowering the directors to proceed, whilst, as the law stood, the purchasers of scrip were not compelled to register it; and the original subscribers to the deed, however unwilling they might have been to go on with the undertaking, would remain liable, and might be called on to raise the money to complete the work when it would have been found to be an utterly unprofitable speculation. Some such clause as that he then proposed was absolutely wanting, no remedy whatsoever having been otherwise provided for the signers of I the deed; and his object was to give to the 223 bonâ fide subscribers an opportunity of reconsidering their condition, and not only of reviewing their position, but of winding up the concern if they should think fit. A strong case in point, showing the necessity for such a power, occurred in the year 1836, when a great number of Bills for the formation of joint-stock companies were passed. The subscribers to the deeds sold their scrip; and after a lapse of two or three years, and long after they had thought themselves quite rid of their liabilities, they were called upon in the year 1839 to pay up demands of 30l. and 40l. a share, by which numbers were totally ruined.* By error this Speech and Motion of Mr. Hudson was inserted in the report of April 30 (vol. lxxxv. p. 1326), instead of a short speech on the subject of "RAILWAY LABOURERS," which will be found in the Appendix at the end of the present Volume.221 of a jury, or by reference to arbitration, as herein provided in other cases of disputed compensation; and all corporations and persons to or with whom such debts, liabilities, or agreements shall have been contracted, or entered into, or who shall be entitled to any such compensation as aforesaid, shall, notwithstanding the determination of such meeting, have such and the same rights and remedies against the said company for the recovery and enforcement thereof respectively, as they would have had if no such meeting had taken place, and as if the company had continued to exist: And be it further enacted, that if the directors shall not within four months from the passing of this Act cause due notice of such extraordinary meeting to be given, it shall be lawful for any six or more of the persons entitled to shares in the said undertaking, holding in the whole shares or stock to the amount of at least 5,000l. to call such meeting by notice, signed by such shareholders, and published in the manner required by this Act with regard to extraordinary meetings of the company; and the proceedings of the meeting so called by such shareholders, at which three-fifths at least of the shareholders shall be present either personally or by proxy, shall be as valid, and shall have the seme force and effect, as if such meeting had been duly called by the directors; and for the purpose of winding up the affairs of the said company, in case such meeting shall determine on the dissolution thereof, it shall be lawful for such meeting to appoint a committee, consisting of such number of persons as they shall think fit, being shareholders in the company; and the directors shall forthwith transfer to such committee all documents, books, papers, and accounts of or belonging to the company, and shall also transfer to such committee all moneys, securities for moneys, and other effects and property of, or belonging to the company; and such committee, or the survivors or survivor thereof, shall forthwith proceed to wind up the affairs of the company, and shall, in the first place, convert into money such of the effects as shall not consist of money, and pay and discharge all the debts, contracts, and liabilities of the company, and subject thereto, and to the necessary expenses of such committee in the execution of their powers, the surplus of the said moneys shall be forthwith divided by such committee rateably amongst the shareholders in the company in proportion to their respective interests therein; and in the event of the directors refusing or neglecting to transfer to any such committee the documents, books, papers, and accounts, moneys, and other property and effects of the company, within ten days after demand, in writing, signed by such committee, or the survivors or survivor of them, and delivered to any one of such directors, or left at his last or usual place of abode, it shall be lawful for such committee, or the survivors or survivor of them, to pass a resolution that such company is desirous to wind up its affairs; and upon a copy of such resolution, signed by any one or more of such committee, being filed in the office of the Lord Chancellor's Secretary of Bankrupts, every such company shall be deemed to have committed an act of bankruptcy at the time of filing the copy of such resolution, and thereupon such proceedings shall be had and taken for the purpose of winding up the affairs of the said company as are directed in and by an Act passed in the eighth year of the reign of Her present Majesty, intituled, 'An Act for facilitating the winding up the affairs of Joint Stock Companies 222 unable to meet their pecuniary engagements,' in the case of any of the acts of bankruptcy therein mentioned, being committed by the companies therein referred to: provided that notice shall be given by the directors, or such committee as aforesaid, if appointed, of the determination of such meeting of shareholders, to be called as aforesaid, with reference to the proceeding in the execution of the powers of this Act, or the dissolution of the company, in the London Gazette, and in one or more newspapers of each county in which the lands proposed to be affected by this Act shall lie, within fourteen days from the holding of such meeting: and at any such meeting to be held as aforesaid, the voting shall take place in the manner prescribed in the 'Companies Clauses Consolidation Act, 1845,' with reference to meetings of shareholders therein referred to.
§ SIR G. CLERKwould confine his objections to the point of form. The hon. Member called this a clause; but in point of fact it was a new system of railway legislation, and it was quite impossible that this clause could be inserted in every Bill. He thought that the hotter course for the hon. Member would be to wait until the Bill which had been introduced into the other House by Lord Dalhousie should come down to the Commons; and he could then propose such amendments as he thought fit, or introduce another Bill, if he thought it necessary.
§ MR. LABOUCHEREthought the proceedings of the hon. Member altogether unprecedented. It was attempting to do that by a clause which ought to be done by a Bill, if it were to be done at all. He would recommend the hon. Member to withdraw the Motion.
§ MR. HUDSONthanked the right hon. Baronet (Sir G. Clerk), and the right hon. Gentleman (Mr. Labouchere) for their suggestions, and withdrew his Motion accordingly. His sole object was to relieve the subscribers to the contract deed from their liabilities, and to prevent a recurrence of the calamities and distress which he had seen in the years 1836, 1838, and 1839, consequent upon the want of some such provision. However, he was glad that Her Majesty's Government appeared to feel the importance of the matter, and he should be happy to hand the further proceedings in it over to Her Majesty's Solicitor General, whom he rejoiced to see in his place.
§ Motion by leave withdrawn.