§ MR. ROUNDELL PALMER moved that it be an instruction of the Committee on Group 5 of Private Bills to entertain the petition of the shareholders, against the Shropshire Union Railways and Canal Bill. The grounds upon which he rested the Motion were shortly these: The petitioners alleged that they had been induced, by fraudulent representations, to become shareholders in the company, and, finding that the Bill before the House violated the contract into which they had originally entered, they were naturally desirous of being heard by counsel against it; but, upon making application for that purpose to the Committee on the Bill, they were informed by the chairman that it was contrary to a standing order of the House to allow a minority of the shareholders of any company to be heard against the directors. To remedy the injustice to which the shareholders were subjected by that decision, was the object of the present Motion. Ho, therefore, trusted, that upon the principle of common justice the House would agree to the proposition.
Motion made, and Question proposed—
That it be an Instruction to the Committee on Group 5 of Private Bills to entertain the Petition of Shareholders deposited on the 26th day of
February, against the Shropshire Union Railways and Canal Bill, and to hoar Counsel, agents, and witnesses, in support thereof.
§ MR. W. PATTEN
said, it was the practice of the House generally, that a minority of shareholders should not be heard against the directors. He thought the question should be left altogether to the decision of the Committee. When the Committee made their report, then it was open to his hon. and learned Friend to bring forward his proposition, and to move that the Bill be recommitted.
§ MR. AGLIONBY
had heard accidentally that this was a petition of only six shareholders out of a number of 2,000 or 3,000; that five of them were not in a proper position to make themselves heard, inasmuch as they had neglected to pay up their calls. Seeing the noble Lord the chairman of the Committee in his place, he wished to ask whether this information was correct?
§ VISCOUNT JOCELYN
, as chairman of the Committee, said it was decided that they ought not to hear so small a number of shareholders against the company generally. They did not, however, think that there was any difference between these particular shareholders and the others; for they would have come to the same conclusion in any event. It appeared to the Committee that these five petitioners were the holders of shares amounting to about 12,000l., but being defaulters they were ineligible to vote upon questions affecting the great interests of the company.
§ MR. CARDWELL
thought it important that they should have a clear understanding upon this point—whether shareholders should be excluded from having a locus standi as regards applications to this House, if they have not paid up all their calls. The Committee, no doubt, have a discretion as to whether they shall hear the case or not; but it should not, he thought, be laid down as a general rule, that in no case of fraud, however bad, should the Committee, under the circumstances in which those petitioners were placed, refuse to entertain the allegations preferred against a company. He would recommend the hon. and learned Member for Plymouth not to press his case at present, as another and a better opportunity would be afforded him of bringing the question forward.
§ MR. T. GREENE
said, that this was simply a matter of discretion with the Committee. A partnership had been entered into, and the minority were bound by the acts of the majority. If this application 436 was allowed, we should find ourselves overwhelmed by similar applications from all quarters. Special cases, however, might arise where the minority would be placed in a situation different from this; such as the circumstance of a preference of shares being granted, when it would be necessary to hear even the minority. He trusted that the hon. and learned Gentleman would not press his Motion at that moment, as it would place the House in a most inconvenient position.
§ MR. J. E. DENISON
thought that to tell the parties that they could be heard upon the Motion for a recommitment of the Bill, was, in effect, to tell them that they could not be heard at all. He hoped it would not be considered as asking too much, if he requested the noble Lord the Member for Lynn Regis, to inform the House whether, in respect to this petition, he had acted on the general practice, or whether he had entered into the actual merits of the case?
MR. T. EGERTON
had always understood that a Committee in such cases took the matter entirely into their own hands, and, in the first instance, determined whether the parties had a locus standi. But he further understood it was not the practice of the House to allow them to appear by counsel or lawyer. He thought that some distinct rule ought to be laid down upon the matter.
§ MR. F. MACKENZIE
believed that there was no practice of the House one way or the other. A similar case to this was some time ago taken up by the hon. and learned Member for Abingdon, and the question was considered, not on the ground of the petitioners being in a minority, but on the merits of the whole case. The same course should be followed in the present instance.
§ MR. ROUNDELL PALMER
protested against the doctrine, that the majority of shareholders possessed uncontrolled power of representing a company for all purposes connected with promoting Bills before Parliament. If application were made to that House to alter the original contract on which the company was formed, it was unjust to prevent parties from being heard against the proposal, on the notion that the common seal represented the majority. Each individual shareholder was entitled to be heard by counsel against a Bill 437 brought forward under such circumstances. The Court of Chancery had frequently had occasion to regret that the House of Commons did not take greater precautions to guard against frauds effected by persons using the seals of companies for the purpose of altering contracts. A question might arise in which the Court of Chancery would feel it necessary to prevent persons proceeding with petitions either in favour of or against a private Bill, and then in all probability a dispute respecting privilege would arise. The Lord Chancellor had declared that he had authority to act in that way, but he was desirous of being spared the necessity of exercising his power, and therefore wished the House to establish rules which would do justice to all parties. For the present, he would withdraw the Motion.
§ Motion, by leave, withdrawn.