The EARL of DONOUGHMORE
moved the Second Reading of this Bill. After a brief reference to the early proceedings of the railway company, he stated that in 1851 their position was one almost of insolvency, and the simple contract creditors were about to take steps to sell the rails and stock, but some of the gentlemen largely interested in the preference shares endeavoured to make an arrangement to save the property. An agreement was accordingly entered into on the part of the preference shareholders to take 3 per cent instead of 6 per cent, and the simple con- 1498 tract creditors postponed further proceedings against the property of the company for three years. A Bill was introduced into Parliament to carry out this agreement, but the very persons who originated this agreement petitioned against the Bill; and the same thing occurred in 1852. It appeared to him that when one body of persons had performed their part of the stipulation, the other body had no right to come to Parliament and claim to be relieved from what they had promised to perform. This matter had been most carefully investigated in the House of Commons, and two Committees had reported in favour of the Bill. The preference shareholders alleged that they never gave their assent to the arrangement; but previously to the Bill coming before the House of Commons only two dissents were received.
§ Moved—"That the Bill be now read 2a."
§ LORD BEAUMONT
objected to the Bill. It contained a principle which their Lordships ought not to sanction. With the private arrangements of the parties he had nothing whatever to do, but merely with the merits of the Bill as it was now brought before the House. Their Lordships were asked to consent to the second reading of a Bill which took away property from persons to whom it had been guaranteed by Act of Parliament, which was theirs by the law of the land, and which they had security for. The parties who were promoting the Bill had no right whatever to deal with the property, and hence they came to Parliament to ask for powers to enable them to do so. Property of this description was often included in settlements, and if their Lordships sanctioned the second reading of the Bill, it would be the means of defeating the intention of the settlors. He should conclude by simply moving that this Bill be read a second time this day three months.
§ Amendment moved, to leave out "now," and insert "this day three months."
§ The EARL of HARROWBY
reminded the House, that, though the noble Lord spoke of this as being an interference by Parliament without the consent of the parties with property which was theirs by the law of the land, the actual property spoken of was in preference shares. Their Lordships, of course, knew that before the preference shareholders came the claims of the creditors, and they might easily judge what the value of the preference shares would have been had this concern come to total ruin. He said that the preference 1499 shareholders had themselves sought this arrangement, with a view to preventing that total ruin which they apprehended, and that they ought not now, after having tied the hands of other parties, to be allowed to turn against their own proposition. The Bill had been most minutely considered by a Committee of the other House, and had been carried unanimously by that Committee.
The MARQUESS of CLANRICARDE
thought that the reason given by the noble Earl for supporting the Bill was no reason at all. The noble Earl stated, that if the concern went to ruin, the property of the preference shareholders would be valueless. What would the noble Earl say to a Chancellor of the Exchequer who urged, as a reason for reducing the interest on a loan, that if the country were ruined the creditor would get nothing at all?
§ After a few words from Lord WYNFORD,
LORD STANLEY or ALDERLEY
said, that the rule always followed by their Lordships in dealing with Bills of this kind was not to pass such Bills, except with the consent of the parties affected by them. In the present case, so far from the requisite number of shareholders—four-fifths—having given their consent, he believed only one-third had expressed their assent. He trusted, therefore, their Lordships would not sanction the second reading.
§ The EARL of YARBOROUGH
supported the second reading of the Bill, in order that it might go to a Select Committee. He thought their Lordships ought to know what proportion of the preference shareholders did originally agree to this arrangement.
§ LORD ST. LEONARDS
would vote for the second reading, but not with a view to break in upon any rights of the preferential creditors, but because, according to the statements that had been made, the preferential shareholders had themselves proposed the terms of a compromise from which they were now desirous of withdrawing.
§ After a few words from Lord BEAUMONT,
§ On Question, that "now" stand part of the Motion,
§ Their Lordships divided:—Content 31; Not Content 14: Majority 17
§ Resolved in the Affirmative.
§ Bill read 2a accordingly, and committed.