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penses incurred in investigating the title, can properly be extended to a case like the present.

That immunity is in itself an anomaly. It probably had its origin in the difficulty in which, in the complicated and highly artificial state of our law relating to real property, an owner of real estate having contracted to sell is too frequently placed from not being able to make out a title such as a purchaser would be bound or willing to take. The hardship which would be imposed on a bonâ fide vendor if, upon some legal flaw appearing in his title, he were held liable in all the consequences which would attach upon a breach of contract relating to personalty, and the difficulty which might be thrown in the way of bringing real property into the market if the full liability attached in such a case, have probably, by an understanding and usage among those engaged in the transfer of estates, led to this exception to the general law. But I can see no reason, in the absence of authority, for extending the exception to parties who, knowing that they have not any present estate to convey, take upon themselves to sell, in the speculative belief that they will be able to procure an interest and title before they are called upon to execute the conveyance. There is an obvious difference between an owner who knows that he alone is entitled to an estate and has a right to sell it, although he may fail to make out a sufficient title, and a person who, not having the estate, takes upon him to sell on the expectation of acquiring the estate in time and making out a title. The cases of Hopkins v. Grazebrook (a) and Robinson v. Harman (6) are direct authorities for saying that a person disposing of real estate to which he has no present (a) 6 B. & C. 31.

(6) 1 Erch, 850.




right, although under a bonâ fide belief that the right will be acquired in time to fulfil the contract, will be liable to the full extent. These cases appear to me to be directly in point. Their authority does not appear to have been shaken by the decision of the Court of Common Pleas in Pounsett v. Fuller (a). For although in that case the defendant, who was held not to be liable in the full extent of damages, had been unable to fulfil his contract in consequence of not having the legal estate, he was in possession and had an equitable interest, and believed himself under the circumstances to be in a condition to convey according to his agreement.

But the present defendants knew themselves to have neither the legal nor the equitable estate in the land which they contracted to sell to the plaintiff. They were trustees under a devise which was inoperative, in consequence of the land of which the devisor had taken upon himself to dispose being vested in trustees under a settlement. They knew that, without the consent of the cestui que trust (the testator's widow) and her trustees to abandon the settlement, and their concurrence in the sale, they the defendants had no right or power to convey the land; and though it is true they had obtained the assent of the cestui que trust, and had every reason to believe that that assent would not be revoked, and that the trustees under the settlement would concur in the sale, they equally knew that none of those parties were under any obligation, legal or equitable, to join in the conveyance, while without them no title could possibly be made. They were, therefore, contracting to sell at a time when they knew they had no power to sell, and no more than the expectation of making out a title. The

(a) 17 C. B. 660.




case appears to me not within the rule as settled in Flureau v. Thornhill (a), but within the exception engrafted on that rule as established by the cases of Hopkins v. Grazebrook (6) and Robinson v. Harman (c), to which I have before referred.

In my opinion, therefore, the plaintiff is entitled to the damages assessed by the jury in respect of the loss he has sustained by the non-completion of the sale.

Rule absolute.

(a) 2 W. BI, 1078.

(6) 6 B. & C. 31.

(c) 1 Exch. 850.

(Wednesday, The IRISH PEAT COMPANY against PHILLIPS. February 13th, 1861.]

The declaration stated that the defendant was the holder of fifty Company

shares in the plaintiffs' Company, and indebted in respect of seven calls, incorporated whereby an action had accrued to the plaintiffs against him under and by charter. by virtue of their deed of settlement. Pleas. 1. Never indebted. 2. That Deed of settle the defendant was not the holder of the shares. 3. That the deed was ment.

not his deed. Replication to the third plea, setting out the charter of Shareholder. incorporation, whereby Her Majesty willed that the capital should be Letter of 120,0001. divided into 6000 shares: that all the proprietors of the stock allotment. of the corporation should execute a deed of settlement whereby the Signing of capital should be divided into those shares, to be numbered in regular deed. succession, beginning with 1, and whereby they should enter into Register. covenants for payment of the sums subscribed by them when called Numbering

for: that such a deed was executed (various clauses were set forth), and of shares. that the defendant was a shareholder and had paid certain calls. Calls.

Before the charter was granted the brokers to the Company put down Action.

the name of the defendant, without his authority, as an applicant for shares, and the promoters allotted to him fifty shares, and sent an allotment letter informing him thereof, and requiring a deposit of 11. per share, adding, "and on your execution of the deed prepared in conformity with the provisions of the Royal charter, you will be entitled to fifty share certificates of the Company.” The defendant paid the deposit of 11. a share. The charter was afterwards granted, and the deed prepared and executed by many shareholders, but not by the defendant. În the deed were the following clauses, which were substantially the same as those contained in The Companies Clauses Consolidation Act, 1845, 8 & 9 Vict. c. 16.:-3. The shares shall be numbered in regular succession, beginning with l; and every share





shall be distinguished by its separate number.-5. Every person who shall have subscribed the prescribed sum to the capital, or shall otherwise have become entitled to a share of the same, and whose name shall have been entered on the register of shareholders, shall be deemed a shareholder.-6. The corporation shall keep a book to be called "The Register

of Shareholders,” in which shall be entered the names of the persons · entitled to shares, together with the number of shares to which such

persons are entitled, distinguishing each share by its number, and the amount of instalments paid on such share.-8. A certificate of ownership, under the corporation seal, shall be delivered to each shareholder; and such certificate shall specify the share in the undertaking to which such shareholder is entitled.-65. In an action for calls, it shall be sufficient to declare that the defendant is owner of one share or more “(stating the number of shares)," and is indebted in respect of one call or more, whereby an action hath accrued to the corporation by virtue of the deed-66. On the trial it shall be sufficient to prove that the defendant, at the time of the call, was a holder of one share or more.—It was represented by the prospectus issued shortly before the date of the charter, and by the letter of allotment, that no more than three calls should be made until the Company's works should be in operation. The defendant had paid four calls, but refused to pay the calls in question.

1. Held by this Court, and affirmed by the Exchequer Chamber, that shares were not created so as to make the alleged owner liable to calls.

2. Held, by the Exchequer Chamber, that the defendant was not a shareholder, as he had not executed the deed of settlement.

3. Semble, that after acceptance of the shares and payment of the calls, especially the call made after those specified in the prospectus and letter of allotment, and the correspondence in which he was treated as a holder of shares, and as he knew of the existence of the charter and the deed, the defendant could not say, as against the other shareholders and the Company, that he was not a shareholder by reason of the stipulations in the prospectus and letter of allotment not having been carried out.

THIS was an action to recover 6921. Os. 11d., alleged

to be due from the defendant to the plaintiffs for calls upon shares in the plaintiffs' Company of which the defendant was alleged to be the holder, and for interest upon the calls in arrear. By consent a case was stated for the opinion of the Court; the pleadings were to form part of the case.

The declaration stated that the defendant was the holder of fifty shares in The Irish Peat Company, and was indebted to the corporation in 6001., in respect of seven calls upon each of the said fifty shares, whereby an action had accrued to the plaintiffs against the defendant under and by virtue of the deed of settlement of the


1861. Irish Peat Company, dated &c. There were also counts IRISH PEAT for interest, and on account stated. Company Pleas (among others): 1. To the whole declaration, Puillips. Never indebted. 2. To the first count, that the defend

ant was not at the times of the making of the calls the holder of the shares. 3. To the first count, that the deed of settlement was not his deed.

Replication to the third plea. That the plaintiffs were a corporation incorporated by Her Majesty's Royal charter of incorporation under the great seal of the United Kingdom, bearing date the 12th April, 1851; and by the said Royal charter Her Majesty (among other things) willed that the capital or joint-stock of the corporation to be used and applied in establishing and carrying on the undertaking, and for the purposes therein mentioned, should consist of the sum of 120,0001., divided into 6,000 shares of 201. each ; and Her Majesty thereby further directed that J. M., W. D. 0., and J. W., and all other the proprietors for the time being of the stock of the said corporation, should, within six calendar months of the date of the said charter, enter into and execute a proper deed of copartnership and settlement, whereby the capital of the Company should be divided into the aforesaid number of shares, to be numbered in regular succession, beginning with 1, and whereby all the proprietors for the time being of the stock of the corporation should enter into proper covenants for the payment of the sums subscribed for by them respectively, and which should then remain unpaid, as and when the same should be called for by the Board of Directors having the management of the affairs of the corporation, and whereby provision should be made for the registration of the names of all the proprie

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