dered to make such entry accordingly; and until such duplicate of such deed should be delivered to the said committee, or their clerk, and filed and entered as above directed, such purchaser or purchasers should have no part or share of the profits of the said navigation, nor any interest for his said share paid unto him, her, or them, or any vote as a proprietor or proprietors.

By other clauses, the company were authorized to appoint a treasurer or treasurers; and they were thereby required and directed to take a sufficient security by one or more bond or bonds, in a sufficient penalty or penalties from their treasurer for the time being, for the faithful execution by such treasurer of such office.

The office of treasurer to the canal company having become vacant, Messrs. Dilworth, Arthington, & Birkett, bankers in Lancaster, were appointed treasurers on the 16th of August 1822. On the 2nd of September 1822, they entered into a joint and several bond in the penal sum of 20,000l., conditioned to be void, if John Dilworth, Robert Morley Arthington, and Robert Birkett, their heirs, executors, and administrators, should at all times thereafter use their best endeavours to collect, get in, and receive all such sums of money, as were, or thereafter should become due and payable to the company of proprietors, from the proprietors of any share or shares in the navigation, or from any other person or persons whomsoever, when and in such manner as they or he should be directed by the said company of proprietors, or their committee, and should from time to time truly and justly account for, and pay and apply such sum and sums of money, and also every sum and sums which should be received by virtue of the said office, unto such persons, and for such purposes as the said company of proprietors, or their committee, should direct, &c.

On the 3rd of September, 1822, Mr. Dilworth, being possessed of 345 shares in the canal, which stood in his name, by indenture of that date, transferred and assigned 300 shares to the company of proprietors, to hold the same to them, their successors and assigns; and, by another indenture, made and executed by and between Dilworth, of the one part, and the company of the other part-reciting the bond, and

that the company of proprietors had required further security, and that Dilworth had proposed to transfer to them the 300 shares, and had, by an instrument duly executed pursuant to the act of parliament, transferred to the company the 200 shares —it was witnessed, that the company should stand possessed of the shares, upon trust to pay to Dilworth or his assigns, the dividends, so long as Dilworth, Arthington, & Birkett should well and truly account for, and pay over to the committee of the company, all such sums as should come to their or any of their hands, custody, or control, as treasurers; and in case they should not so account for and pay such monies, then that the company should sell the shares, or a competent part thereof, and apply the proceeds in payment of such sums as should have been received by the treasurers, and not have been by them duly accounted for.

The assignment of the shares was not filed and entered as required by the act; and the 345 shares continued standing in Mr. Dilworth's name in the books of the Canal Company, and had never been transferred by the clerk, as he was required to do by the 83rd section. The petition and affidavit stated, that the transfer and deed of trust were, at the time of the dates thereof, duly executed, and were left, by the parties thereto, with the clerk of the said company, at the office of the company in Lancaster.

A commission of bankrupt having issued against Dilworth, Arthington, & Birkett, the Canal Company presented a petition, stating, that the said treasurers, at the time of their appointment, agreed to "keep the account of the nonies received by them, as such treasurers, as a banking account, and that interest should be received or allowed by them, according as the balance of cash in their hands was credit or debit; that, accordingly, a banking account was opened at the said banking-house by them, as such treasurers, and interest was charged in such account on the balance from time to time due thereon, and was credited or debited to the company, according as the balance happened to be in their favour or against them; that, at the issuing of the commission, there was due and owing to the company from the bankrupts, upon the account aforesaid, for

cash and interest, the sum of 8,703l. 15s. 5d." The petition insisted, that the company had a valid equitable lien or mortgage on the 300 shares for the sum of 8,8357. 10s. 11d. and interest; and it prayed, that the 300 shares might be sold, and that the monies which should arise by the sale, after deducting thereout the costs and charges of the sale and the petition, might be applied in discharge of the said debt.

The petition came on before the Vice Chancellor.

It was opposed by the assignees, on the ground, that the shares, never having been transferred as required by the act, into the names of the Canal Company, but remaining in the name of Mr. Dilworth, at the time of his bankruptcy, passed to the assignees, by virtue of the statute of James, as being in the order and disposition of the bankrupt.

The Canal Company relied on the case of The Vauxhall Bridge Company (1), wherein the Vice Chancellor, Sir J. Leach, decided, that shares in that company were not within the statute of James, as the corporation was seised of real estate.

The judgment of the Vice Chancellor, Sir L. Shadwell, was as follows:

of

The question is, whether the company proprietors are entitled to avail themselves of the imperfect assignment which has been made. It appears to me, that there is nothing in the act of parliament, which prevents them from availing themselves of the assignment. It is perfectly true, that the act of parliament has directed (sec. 79), that it shall be lawful to and for the several proprietors of the navigation to sell and dispose of his, her, or their share or shares therein, and that every purchaser shall have a duplicate; and one of the deeds, duly executed by the seller and purchaser, shall be delivered to the committee or clerk, to be filed and kept for the use of the company; and until such duplicate of such deed shall be so delivered to the said committee or their clerk, and filed and entered as above directed, such purchaser shall have no part or share of the profits of the said navigation, nor any interest of his said share paid to him, nor any vote

(1) Glynn & Jam. 101.

as a proprietor. But, it does not say, that, until the deed shall be so delivered and filed, and entered, the purchaser shall have no interest in the share:-it merely is a suspension of the receipt of casual profits as they incidentally arise-a withholding those profits from the assignee,-until the deed, or duplicate of the deed, be delivered, duly filed, and entered; and the act of parliament has said, that it shall be lawful for the proprietors to sell and dispose of their shares, prescribing a form; and the particular form of the conveyance was adopted in this case, though the duplicate was not delivered, and, of course, not filed and entered. I should think, that the only consequence of that would be, that, in respect of any past profits, the company could not avail themselves of the assignment.

It was not attempted to be disputed, that, generally speaking, chattel interests are not within the statute of James, or the 72d section of the present Bankrupt Act. But it has been said, that the interest in this particular Canal Company cannot be assimilated to a chattel interest in land. Now, it appears that this company was formed for the purpose of making a canal, and for that purpose they were empowered to purchase land. It has been observed, that the profits of the canal were not profits arising from the land in my opinion, they were, directly and properly speaking, profits arising from land; because they were nothing more than monies which should arise from persons who purchased the liberty of going over the land, that is, the land and water of the Canal Company, and, for that privilege, paid the tolls: therefore, the profits appear to me to be profits arising from land. Then the act of parliament has said, in the 63rd section, that the shares shall be personal estate, and transmissible as such. So, terms of years would be personal estate, and transmissible as such; but it never can be said, that, merely because an interest in land is personal estate, therefore it is transmissible precisely in the same manner as goods and merchandize are, which may be in the hands of a merchant, or any other person dealing as a trader. The shares are to be deemed personal estate, and shall be transmissible as such that means, transmissible as between the representatives of the parties who hold the shares.

The act has prescribed, that the shares shall be assigned by deed, treating the subject, in the form of the conveyance, as something in the nature of a chattel interest in realty; if it had been meant, that they should pass as general personal estate, not of the nature of real estate, a different mode of conveyance, I should have conceived, would have been adopted. Then, it has been alleged, that a great deal of mischief may arise from sustaining such a transaction. I should think that mischief was not very likely to arise thus; because, here, the assignment having been made to the company, and they having delivered it to their clerk, it is not very likely that any purchaser could have been deceived: the moment he came to perfect the conveyance, the matter would have been made manifest to him.

With respect to the general credit, which might arise through searching the books, which the act has directed to be kept, it is perfectly true, that might be so; but then the question is, whether the act of parliament has put a complete negative upon any such transaction as this. It does not appear to me, that it has done so. Therefore, inasmuch as there is, to a limited extent, a purchase made by the company of the shares, it appears to me, that the company will be at liberty to avail themselves of the present assignment, so far as to comprehend the future profits.

dividual is a share or shares in the profits, and nothing else.

The real estate, which is vested in the company, is an estate in fee: if the interest of the shareholder is real estate, how comes it to have none of the qualities of the only real estate with which the shares have any connexion? It is not, in itself, a chattel interest; for here there is nothing analogous to a term of years. If it is not a chattel interest, and is not (as it is admitted that it is not) freehold, what can it be but personal estate? It is said, that it is of the nature of a chattel real. No such property is known to the law. Either it is a chattel real, or it is not; if not, where are the words in the act of parliament, creating a species of property which is neither a freehold interest, nor a chattel real, nor a personal chattel? Would such shares, for the purposes of probate or administration, be considered as chattels real, or purely personal? If they are chattels real, they would be bona notabilia in every diocess or peculiar through which the canal passed, like a lease for years, or other chattels real, which are bona notabilia where the land lies: Comyns's Digest, tit. “Administrator," (B. 4.) Now, in Ex parte Horne (1), it was argued, that shares in the Worcester Canal, which were declared by the act incorporating the company to be made personal property, were bona notabilia in every diocess through which the canal passed; but the Court decided, that

The Solicitor General, Mr. Knight, and Mr. Geldart, were for the appeal :

Mr. Rose, Mr. Montague, and Mr. Duckworth, contrà.

In support of the appeal, it was argued, that, though the company, as a corporation aggregate, have real estates, the property of each individual member consists not of real estate, but of his shares in the general funds of the company, which shares are expressly made personal estate by the words of the act. If the act merely intended to make the shares personal estate, for the purpose of transmission by sale, or on death, or otherwise, other words would have been used; whereas the whole scope of the act is to treat them as personal estate for all purposes. The actual interest of each in

were filed; thereby establishing the doctrine, that they were not chattels real, but chattels purely personal, and, consequently, bringing them within the operation of the Bankrupt Act, as to reputed ownership.

Such a case as this is clearly within the mischief, which the 72nd section of the Bankrupt Act, and the corresponding provision in the statute of James, were intended to prevent. Here Dilworth appeared to all the world as the absolute owner of these shares; and thereby obtained or might have obtained a false credit.

As to the case of The Vauxhall Bridge Company, it is clear, that there the question was not very much considered. It was there assumed that the shares were not personalty.

(2) 7 B. & C. 633; s.c. 6 Law Journ. K.B. 173.

On the other hand, it was argued, that the law must be considered as settled by the case of The Vauxhall Bridge Company, the authority of which had never till now been doubted. Independently of authority, the interest of the shareholder was a right to profits arising out of land; and though the act made the shares personal estate for the purposes of transmission, they still continued to be a species of property which savoured of the realty. The bankrupt would not have gained false credit by them for it was only to other shareholders that the circumstance of the shares standing in his name could be known. The public at large had no right to inspect the books of the company; in fact, there was not in the bankrupt such an apparent possession as could deceive any one.

In a case of so much importance, the Court, at least, would not overturn the principle established by the Master of the Rolls, without giving the Canal Company an opportunity of obtaining the opinion of a court of law.

On the first day of Michaelmas term, and while the appeal stood for judgment, the respondents presented a petition, praying, that, before judgment was given, the question might be re-argued, or a case directed for the opinion of a court of law.

The Lord Chancellor. — Dilworth and Company, who are bankers, carrying on business in the county of Lancaster, were the treasurers of the Lancaster Canal Company, which was incorporated by act of parliament in the year 1792, and had the power of purchasing and holding lands as a corporation for the purpose of that concern. They held, and now hold, real property, and the proceeds arising from that concern are proceeds arising out of a real estate. For the purpose of carrying on the concern, it became necessary to raise a certain sum of money; that sum of money was raised by a subscription for shares, and the shareholders were entitled, under the provisions of the act of parliament, to the profits of the concern. As the case, therefore, thus stands, these profits, which the shareholders are entitled to receive, are profits arising out of real estate.

But there is a clause in the act of parliament, by which the general law and the general rule in this respect, is controlled. It is by an express provision in the act of parliament, expressed in the most general terms, declared, that those shares shall be considered as personal estate, and transmissible as such. Nothing can be more general than the terms. But it is contended at the bar, in the first place, that the shares were to be considered as personal estate only for the purpose of transmission to the personal representatives of the shareholders. The words do not authorize such a limited construction.

The words are that they shall be personal estate, and be transmissible as such.

It is then contended, that they are to be considered as chattels real. On what argument, however, that is founded, I find it difficult to collect: why they are to be considered as chattels real, or why the legisla ture should have meant that they should be considered as chattels real, not having so expressed it, I find no means whatever to collect. The persons, who are shareholders, are absolute holders of the entire interest. in the property, whatever that is. The legislature has declared it shall be personal estate; and there is nothing whatever in the act of parliament that I can discover, at all controlling the effect of that provision.

If that be so, the consequence follows, that this property, if held by the bankrupts at the time of their bankruptcy, would have passed to their assignees; but that is not the question in this case. The question is, whether the property was under the order and disposition of Dilworth as the reputed owner.

At the time Dilworth and his partners became treasurers of the concern, they entered into a bond in the penalty of 20,000l. for the purpose of indemnifying the company against any loss which might arise in consequence of their failing properly to account. In addition to this bond, Dilworth, who at that time was the holder of 345 shares, transferred 300 shares to the company, and a trust deed was executed, by which the com pany undertook to pay the dividends of the shares to Mr. Dilworth, until there should be some default on the part of the treasurers; and, in case of such default, they were to have the power of selling the shares

The act has prescribed, that the shares shall be assigned by deed, treating the subject, in the form of the conveyance, as something in the nature of a chattel interest in realty; if it had been meant, that they should pass as general personal estate, not of the nature of real estate, a different mode of conveyance, I should have conceived, would have been adopted. Then, it has been alleged, that a great deal of mischief may arise from sustaining such a transaction. I should think that mischief was not very likely to arise thus; because, here, the assignment having been made to the company, and they having delivered it to their clerk, it is not very likely that any purchaser could have been deceived: the moment he came to perfect the conveyance, the matter would have been made manifest to him.

With respect to the general credit, which might arise through searching the books, which the act has directed to be kept, it is perfectly true, that might be so; but then the question is, whether the act of parliament has put a complete negative upon any such transaction as this. It does not appear to me, that it has done so. Therefore, inasmuch as there is, to a limited extent, a purchase made by the company of the shares, it appears to me, that the company will be at liberty to avail themselves of the present assignment, so far as to comprehend the future profits.

Against this decision the assignees presented a petition of appeal.

The Solicitor General, Mr. Knight, and Mr. Geldart, were for the appeal:

Mr. Rose, Mr. Montague, and Mr. Duckworth, contrà.

In support of the appeal, it was argued, that, though the company, as a corporation aggregate, have real estates, the property of each individual member consists not of real estate, but of his shares in the general funds of the

company, which shares are expressly made personal estate by the words of the act. If the act merely intended to make the shares personal estate, for the purpose of transmission by sale, or on death, or otherwise, other words would have been used; whereas the whole scope of the act is to treat them as personal estate for all purposes. The actual interest of each in

dividual is a share or shares in the profits, and nothing else.

The real estate, which is vested in the company, is an estate in fee: if the interest of the shareholder is real estate, how comes it to have none of the qualities of the only real estate with which the shares have any connexion? It is not, in itself, a chattel interest; for here there is nothing analogous to a term of years. If it is not a chattel interest, and is not (as it is admitted that it is not) freehold, what can it be but personal estate? It is said, that it is of the nature of a chattel real. No such property is known to the law. Either it is a chattel real, or it is not; if not, where are the words in the act of parliament, creating a species of property which is neither a freehold interest, nor a chattel real, nor a personal chattel? Would such shares, for the purposes of probate or administration, be considered as chattels real, or purely personal? If they are chattels real, they would be bona notabilia in every diocess or peculiar through which the canal passed, like a lease for years, or other chattels real, which are bona notabilia where the land lies: Comyns's Digest, tit. "Administrator," (B. 4.) Now, in Ex parte Horne (1), it was argued, that shares in the Worcester Canal, which were declared by the act incorporating the company to be made personal property, were bona notabilia in every diocess through which the canal passed; but the Court decided, that they were bona notabilia where the transfers were filed; thereby establishing the doctrine, that they were not chattels real, but chattels purely personal, and, consequently, bringing them within the operation of the Bankrupt Act, as to reputed ownership.

Such a case as this is clearly within the mischief, which the 72nd section of the Bankrupt Act, and the corresponding provision in the statute of James, were intended to prevent. Here Dilworth appeared to all the world as the absolute owner of these shares; and thereby obtained or might have obtained a false credit.

As to the case of The Vauxhall Bridge Company, it is clear, that there the question was not very much considered. It was there assumed that the shares were not personalty.

(2) 7 B. & C. 632 ; s.c. 6 Law Journ. K.B. 173.