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newspapers to a notice of this measure, much less to any comment upon it; and yet the good that it will effect is, perhaps, greater than that of any measure which has been introduced in the law of real property since the acts passed at the recommendation of the commissioners of 1828.” 1 Alas! these remarks were written at a time when it was hoped and expected that Lord St. Leonards' bill would be passed. It was accepted by the Lords; but in the Commons, on the 8th April last, the Secretary to the Treasury stated that the bill “seriously affected the interests of the Crown and the revenue departments,” and that it would be more convenient that the bill should be withdrawn and brought forward in a new parliament. The Attorney-general weakly acquiesced in this suggestion, and with “unfeigned regret” withdrew the bill. Of course, if the Treasury is determined to stick to a system which all practical men have condemned for years ; namely, that of rendering real estate in the hands of a purchaser liable to Crown debts and succession duty, which no innocent purchaser ought ever in justice to be called on to pay, any endeavour to reform our real property law may as well be abandoned at once. Here, we think, the laws of real and personal property might properly be assimilated. If you buy stock, you do not require to be told that it is unnecessary to inquire whether any legacy, or succession duty, or any other debt is owing, or may become owing, to the Crown by the proprietors from whom you purchase the stock, and the reason for keeping up the distinction is certainly not obvious to any but Secretaries to the Treasury. But the members of the government were not warm supporters of Lord St. Leonards' bill-probably for the reason that it was not a government measure—and that they did not care to fathom or could not comprehend its merits ; nor would it, they might possibly believe, bring credit on themselves—they could make no political capital out of it.
We have, in fact, been experiencing the evils of a government too weak and incapable to adopt or institute any useful or prac
* Remarks, &c., issued by the Manchester Law Association.
tical measures themselves, but strong enough to barricade to others the proper avenues to legislative reform. The great drums have been beaten, but the drummers have been as hollow as the drums. It is not for us to say how much this sad spectacle results from ignorance, or how far it has been a “ game of speculation."
We do not conceal our opinion that the delusions (of which we doubt not he himself was also a victim) attempted by Sir H. M‘C. Cairns to be practised on the Commons are, politically and socially, both a blunder and a crime—a blunder, because the short-lived • brilliancy” of the parliamentary orator will be forgotten, whilst the falseness of the pretensions put forward will long be remembered: brumagem diamonds may once cheat the confiding customer, but what becomes of the character and future trade of the cheap jeweller?—a crime, because possible and real improvements of judicious reformers have been retarded, and confidence has been shaken in the good faith, probity, and ability of public men who profess to devise and carry out the rational requirements of the public.
DIVORCE AND MATRIMONIAL. 1. Smith 9. SMITH (28 L. J. Prob. and Mat. Court, 77)–Petition by
Wife for Dissolution of Marriage_Desertion-Decree of the remedy of Judicial Separation.
230 COMMON LAW. 2. Scott v. Dixon (Hil. Term, 1859, Q.B.-Not yet reported)
Liability of Directors of Public Companies for Misrepresentations
1. SMITH v. SMITH. 28 L.J. Prob. and Mat. Courts, 77. Petition by Wife for Dissolution of Marriage-Desertion-Decree of the
remedy of Judicial Separation. In the above case the wife petitioned under 20 and 21 Vic., c. 88, s. 27, for a dissolution of marriage, on the ground of adultery, coupled with desertion, without reasonable excuse, for two years and upwards; and the prayer of the petition was simply for a dissolution of the marriage. The respondent did not appear. The court (which was composed of the Lord Chancellor, Mr. Justice Wightman, and the Judge Ordinary) held that the adultery was proved, but that the desertion was not, as there were circumstances in the case leading to the belief that the petitioner and her husband parted by mutual consent. The Court was of opinion, however, " that although the petitioner may pray a dissolution of marriage, yet it is competent for the Court to grant such relief as the facts proved would warrant." A judicial separation was therefore decreed, and the husband condemned in costs.
2. Scott v. Dixon.-(Hil. Term, 1859.—Not yet reported.) Liability of Directors of Public Companies for Misrepresentations-Fraud
Publication of Reports by Directors—Evidence. TIME was when directors of public companies were assumed to be nearly, if not quite irresponsible, for all that they said or did whilst seated behind the board-room door. When great
companies failed, and gross frauds were found to have been committed by managers and directors, they escaped with comparative impunity. But then came the Royal British Bank swindle, and the law was awakened, and the public, laying to heart the verdict of" guilty” which in that case was returned, by a natural re-action began to think that they could hold any and every director of a company liable for every inaccurate statement made by any director or officer of that company as to its affairs.
The case of Scott v. Dixon, having been also cited in support of the above opinion, we now purpose giving an account of it, not so much on the ground of its involving any new doctrine in point of law, but to expound clearly for what class of misrepresentations, and on what evidence, the defendant in that case was held responsible.
The action was brought by John Scott and Robert Robinson, against Joshua Dixon, one of the directors of the Liverpool Borough Bank. The plaintiffs, by their declaration, sought to recover of the defendant damages for certain false representations as to the solvency and affairs of the bank, alleged to have been fraudulently and deceitfully made by the defendant to the plaintiffs, to induce them, and whereby they in fact were induced, to purchase shares in the bank, the purchase-money of which shares they lost, the bank being insolvent and the shares worthless, and in respect of which shares they were compelled to pay certain calls made after failure of the bank, as a contribution to its losses.
The defendants pleaded, 1st, not guilty; and 2nd, that the plaintiffs were not so induced as in the declaration alleged. The false representations complained of were contained in a report (set out in the declaration) presented by the directors to the shareholders on the 28th day of July, 1837, which was as follows
“ LIVERPOOL BOROUGH BANK. “ Board of Directors for the year 1856.-William Rathbone, Esq., Chairman ; Christopher Hind Jones, Esq., Deputy-Chairman ; Edward Benn, Esq. ; Duncan James Kay, Esq. ; John Cropper, Esq.; David Lamb, Esq. ; Robert Crosbio, Esq. ; Joseph Rater, Esq. ; Joshua Dixon, Esq. ; James Ryder, Esq. ; Robert Ellison Harvey, Esq. ; Thomas Sellar, Esq.; John P. George Smith, Esq., Manager.
" REPORT OF THE DIRECTORS TO THE PROPRIETORS. “ According to the last report, the paid up capital of the Bank was £900,000, and the reserve fund was £101,775, 10s. 11d.
“Since that date two calls of £l per share have been paid upon the new shares, inaking the capital £1,000,000.
“The nett profits of the past year, after payment of all expenses
of management, and after deducting £45,825, 2s. ld. for losses by bad debts incurred during the same period, amount to £69,312 12 8
Appropriated as follows31 per cent. dividend upon £950,000 - £33,250 0 0 24
£1,000,000 - 25,000 0 0 Property tax paid by the bank - 3,629 6 8
£61,879 6 8
Balance carried to reserve fund
£7,439 6 0
Nearly the whole of the losses above-mentioned have been caused by the frauds of a customer.
“In winding up the affairs of 1854, a year which it is well-known was most disastrous to those customers of the bank who were engaged in the colonial shipping trade, heavier loss has been sustained in the realization of the assets then taken over by way of security, and in the liquidation of estates then considered good, than could possibly have been anticipated.
“ The directors have thought it their duty at once to reduce the dividend to the rate of £5 per cent. per annum, on the grounds that, taking the most favourable view of the liquidation of these accounts, the whole of the reserve fund will be required to meet the losses incurred ; and that, on the other hand, taking the most unfavourable view consistent with probability, the good current business of the bank will, in their opinion, be sufficient to admit of the regular continuance of the dividend without eucroaching on the capital at the same period in the ensuing year.
“ In laying this statement before the shareholders, the directors desire strongly to impress upon them that its unsatisfactory character is to be attributed to the affairs of 1854, and that, apart from these, the sound and legitimate business of the bank would have enabled it to pay the ordinary dividends, and also to add largely to the reserve fund, notwithstanding the losses that have been incurred subsequently to that year. They wish also to state their confident expectation, that the change they are making in the policy and regulations of the bank will effectually guard against the recurrence of similar results.
“Mr. Smith having stated to the directors that his health would not longer permit him to undergo the labour of conducting the details of the manager's duties, and having in consequence requested to be relieved from his office, they have with reluctance complied with his wish, and have made arrangements that Mr. Thomas Sellar, who is in every respect eminently qualified for the post, shall, from the 1st of August next, assume the position of manager. Mr. Smith has, at the request of the directors, consented to take a place at the board, and to continue to give the bank the aid of his valuable assistance.
“ The directors who go out of office by rotation are Mr. Rathbone, Mr. Dixon, and Mr. Benn, who are eligible for re-election.