Then

Vendor and purchaser-Contract for sale of land-Printed conditions-Settlement purchase-Instalments Postponement of payment Interest - Closer Settlement Acts.Conditions of sale of land held under the provisions of the Closer Settlement Acts, provided that the purchaser from the date of completion should pay, inter alia, all outgoings payable in respect of the property. followed a clause providing that all lands were sold subject to the payment by the purchaser of all moneys payable to the Government for interest, instalments of purchase money, rents or otherwise, in respect thereof. It was further provided that the purchaser should take possession and all payments should be made on the 1st March, 1921. At the date of the sale, 8th September, 1920, payment of two of the annual instalments of purchase money payable to the Crown (those of 1910 and 1911) had been postponed under the provisions of the Closer Settlement Act 1909, and still remained postponed; and in December, 1920, another instalment fell due. Held, that, as between vendor and purchaser, the latter was bound to pay all future instalments of purchase money, including postponed instalments, payable to the Crown after the date of the sale, but not interest on the unpaid balance of such purchase money for any period prior to 1st March, 1921. MUNRO v. TAYLOR, 24 S. R. 14; 40 W.N. 146. [New South Wales.]

And see CROWN LANDS.

CLUB.

Unincorporated association-Racing club Powers of committee-Disqualification of person attending race meeting-Right of actionNatural justice--Action against club-Parties— Whether cause of action against defendantDisregard of rules of legal procedure-Action wrongly framed Nonsuit-0. VI., r. 6; 0. III., r. 10-Sufficiency of service of noticeCommittee-Bias.-The North Queensland Racing Association was an unincorporated voluntary association consisting of a number of racing clubs which also were unincorporated. Rule 2 of the Rules of the Association

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provided that any person who takes part in any matter coming within these rules shall be held thereby to consent to be bound by them, and shall not be entitled to appeal to any Court because of anything done under their provisions.' The respondent, as a member of the public, attended a race meeting held by one of those clubs, the Townsville Turf Club, and he was disqualified for life by the stewards of that club for being concerned in the tying of the tape round the tongue of a mare which was racing at that meeting. That disqualification was confirmed by the executive committee of the association but in an action in the Supreme Court the disqualification was declared illegal and void on the ground that the respondent had not received notice of the charge against him or the place and time of the hearing thereof. Subsequently the committee of the association decided to call upon the respondent to answer a charge for the same alleged offence. son authorised by the committee went to the respondent in a public place, put an envelope containing a notice of inquiry on his arm, saying to him: "I wish to serve this notice on you." The respondent said: "I want none of that," and hastily went away, and the envelope fell to the ground. On other occasions on the same day the same person endeavoured to approach the respondent and give him the notice, which he had picked up when the respondent went away, but the respondent avoided him. The Committee inquired into the charge on 23rd May, 1922, and disqualified the respondent for life. The respondent did not appear and made no defence. Subsequently he brought an action in the Supreme Court claiming that the disqualification was illegal and void, and an injunction and damages. In that action the only defendant was the appellant, who became defendant in the following way: Prior to the issue of the writ the respondent wrote to the Association asking that a nominal defendant be appointed for the purposes of the action, but this the association refused to do, and thereupon the respondent obtained ex parte from a Judge in Chambers an order appointing the appellant the person to be sued as representing the North Queensland Racing Association, on 12th May, 1922, in an action intended to be instituted against the said association, its executive and members." Judgment was given in the action against the defendant personally declaring the decision of the committee to be illegal,

null, and void, and ordering the appellant to pay £5 damages and the costs of the action. Held, that the order appointing the appellant as defendant was contrary to the requirements of O. VI., r. 6. That the action was wrongly framed and that the litigation had been conducted with disregard of the rules of legal procedure, and that for that reason alone the judgment should be set aside and judgment of non suit entered. And on the assumption that the action had been properly brought against the members of the executive committee of the association as the only defendants, and on the undisputed facts proved at the trial, held, that the respondent had no cause of action, and that judgment in the action should be entered for the appellants with costs of the trial and of the appeal. Per Shand, J.: That the rule 2 does not bind the respondent or make him party to any contract or consensual compact contained in the rules of the as :ociation or entitles him to claim any rights which would not have been claimable by him if those rules had not been made. Per Shand, J. That there had been sufficient service of notice of the inquiry. Per Shand, J.: Assuming the respondent had any cause of action if he was disqualified by the executive otherwise than in accordance with the rules, he had failed to prove that they acted contrary to the rule or contrary to natural justice. Per Shand, J.: That in coming to their conclusion the members of the committee so long as they acted honestly, were entitled to take into account facts which came to their own knowledge, or of which they were credibly informed by other members. Per Lukin, J.: That the appellants' action was done bona fide in their own interest and in the interest and protection of racing, and was not in itself illegal or done by illegal means, and the respondent had no cause of action. Per Lukin, J.: That there was no power under the Rules of Court to appoint, ex parte, a defendant as a representative defendant in an action for tort against various persons having different interests. Semble, per Lukinl, J.: The committee had power to act as they did under their rules. FEARNLEY V. BERRY, 1924 S.R. (Q.) 280. [Queensland.]

Club (social) Incorporated under Incorporated Societies Act 1908-Wrongful expulsion of member-Breach of contract-Damages-Liability of members of committee in tort. A club incorporated under the Incorporated Societies Act 1908, which, acting by its executive committee, wrongfully and in breach of the club's rules excludes a member from the use of the club premises and the social and other advantages incidental thereto commits a breach of contract for which the member wrongfully excluded is entitled to recover damages against the club. The members of the committee, acting within the scope of their authority, are not personally liable in tort for inducing or procuring such breach of contract. Said v. Butt ([1920] 3 K.B. 497) followed. Application of the rule in Lumley v. Gye ([1853] 2 E. & BI. 216) considered. HEN

DERSON v. KANE & THE PIONEER CLUB 1924 N.Z.L.R. 1073; G.L.R. 639. [New Zealand.]

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Voluntary association -Club-Rules of― Suspension of member-Resolution that membership cease Power of expulsion-Executive of club acting contrary to natural justiceAmendment of rules-Validity of amendment of rules-Notice of meeting of executiveValidity of resolution-Jurisdiction of CourtDeclaration-Injunction.—Rule 49 of the rules of a voluntary association provided: Alterations to rules shall only be made at the annual meeting or a special general meeting called by the executive for the purpose. Twenty-eight clear days' previous notice in writing must be given to members, and such notice shall be accompanied by a copy of the proposed alteration." On 17th January, 1923, a notice in writing, dated 16th January, 1923, was issued to members of the Queensland Irish Association informing them that at the annual meeting to be held on 25th of that month, a proposal would be made to amend rule 49 so as to make the last clause of it read: Twenty-eight clear days' previous notice in writing must be given to the secretary and seven clear days' previous notice in writing must be given to members, and such notice shall be accompanied by a copy of the proposed alteration." The notice of the annual meeting was therefore at most an eight clear days' notice. At the meeting this alteration of rule 49 was proposed and seconded, but on a motion of the plaintiff that the words fourteen clear days" should be substituted for the words seven clear days," a resolution was carried adopting this amendment of the proposed amendment. Held, that the amendment was a legitimate amendment of the proposed amendment. Held, that as the amendment of rule 49, which was carried at that annual meeting had since then always been acted on without any objection, it should be treated as valid and operative, and as having been duly adopted by the members of the association, and that after that date, for the purpose of convening meetings to amend the rules fourteen clear days' previous notice to members became a sufficient notice. In March, 1923, the Executive, acting under rule 38 suspended the membership of the plaintiff for twelve months from that date. On 8th February, 1924, the plaintiff sent his subscription to the secretary, who, however, did not notify the plaintiff of its receipt by him. On 27th February an undated notice was issued to members convening a special general meeting on 12th March, 1924, and at that special meeting a resolution was passed adopting an amendment of the rules whereby the following words were added: "The committee may, if they see fit, at any time decline to renew the subscription of any member or any suspended member. The membership of such members whose subscription the commitee have declined to renew shall cease as from such date as the committee may decide, and such member's name shall thereupon be removed from the roll of members, and he shall forfeit all

interest in the association, subject to the right of appeal hereinafter provided." No notice of this meeting was sent to the plaintiff. On 18th March, 1924, the executive passed a resolution that the plaintiff's subscription for the year 1924 should not be received; that the plaintiff's membership should cease as from the expiration of his term of suspension, namely, the 21st March, 1924; that his name should be removed from the roll of members, and that he should forfeit all interest in the as sociation, subject however, to the right of appeal stated in the rules, by which it was open to him, within one calendar month from the date of the non-renewal of his subscription, to appeal from the decision of the committee by notice in writing to the secretary in a manner which authorises a special general meeting of members to be called on a request in writing signed by not less than 50 financial members. The plaintiff had acquired vested interests in the property of the association which was held in trust for the members for the time being. The plaintiff brought an action in the Supreme Court claiming that the resolution was ultra vires and void. The defendants were the members of the executive and the secretary of the association. Held, that the resolution passed by the executive was contrary to natural justice, in that the executive purported to expel the plaintiff from the association without giving him any notice of their intention to proceed against him, and without making any charge against him or affording him any opportunity of showing cause against their decision. also, that the plaintiff was not debarred from bringing this action in a court of law, challenging the validity of the actions of the executive in passing the resolution, by reason that he did not take advantage of the right of appeal given by the rules. Held, that the secretary was not properly joined as a defendant, as no cause of action was established against him. DALY v. GALLAGHER, 18 Q.J.P.R. 141. [Queensland.]

Held,

"O.R. dripping." The Commerce Act provides that any person who knowingly exports any goods to which a false trade description is applied shall be liable to a penalty of £100 and the goods if exported shall be forfeited to the King. Held, that even assuming an offence was committed in this case, there being no judgment of condemnation by which the goods were forfeited, the property in them had not passed to the King. Held, further, that as the goods were on the high seas they were not within the Commonwealth or subject to Australian law, and the purchaser could not reject them on the ground that they were falsely branded. Scalaris v. Ofverberg (37 T.L.R. 307) distinguished. J. W. H. TURNER & Co. v. O'RIORDAN & ORS., 24 S. R. 421; 41 W.N. 141. [New South Wales.]

COMMISSION AGENT.

See PRINCIPAL AND AGENT.

COMPANY.

Application for shares subject to the condition that 40,000 shares should be applied for -Application-moneys for certain shares paid by cheque subsequently dishonoured-Applications for shares thereby reduced below 40,000-Whether applications such as to enable directors lawfully to make allotments thereon -Delay by applicant in repudiating -Contract to take shares-Payment of balance due on shares-Continuing in office of directorElection to retain shares-Companies Act 1908, s. 95 (4).-McDONALD v. WAIRAKEI LTD., 1924 N.Z. L. R. 201. [New Zealand.]

Same case: 1923 G.L.R. 257; 1923 Digest, col. 41.

Shares issued for consideration other than cash-Omission to file contract due to accident or inadvertence-Discretion of Court to grant relief.-Where it is established that the omission to file a sufficient contract under s. 55 of the Companies Act 1899, was accidental or due to inadvertence the Court will, in the exercise of its discretion, prima facie, grant relief unless the conduct of the applicant is such as to disentitle him. In re UNITED CARRYING CO. LTD., 24 S. R. 413; 41 W.N. 88. [New South Wales.]

Subscriber to memorandum of association sued for unpaid calls-Misrepresentation by promoters alleged-Repudiation of sharesRescission. PETROTITE & CHALLENGE HEATERS LTD. v. BODLEY, 1924 N.Z.L.R. 102. [New Zealand.]

Same case: 1923 G.L.R. 573; 1923 Digest, col. 44.

Capital-Paid-up capital-Shares issued paid up and partly paid-up-What contract binding on company-Shareholder's liability. -A company was formed with a capital of

£1000 in a thousand £1 shares to take over a coal and grocery business carried on by I. W. the wife of R. W. A clause in the articles of association stated that the shareholders should be I. W., for 495 fully paid-up shares. F. C., for 5 fully paid up shares, and R. W., 500 shares on which the sum of 10/- should be deemed to have been paid up. Neither memorandum or articles of association contained any reference to the business carried no by I.W., or to any arrangement for the purchase of that or any other going concern, but from the incorporation of the company that business was treated and carried on as the business of the company, and the company took posesssion of the assets and assumed the liabilities thereof. There was no evidence of any express arrangement between I. W., and the company that the company should accept the business and assets, subject to the liabilities, in satisfaction for the moneys payable on the shares of the applicants, or even of her own shares. No calls were made on the shareholders, no money was paid on the shares and the company paid no money to I. W. The company went into liquidation and the Court was asked to determine that R. W., was liable only for 10/per share in respect of his 500 shares and that I. W. and F. C. were not liable for any contribution in respect of their shares. Held, that in the absence of any contract binding on the company to accept money's worth in satisfaction of the liability of the shareholders or any of them in respect of their shares each of them was liable to pay the full sum of 20/- in respect of each share subscribed for. In re STEPHEN (J.A.) LTD. 1924 G.L.R. 446. [New Zealand.]

Shares Certificates for fully paid-up sharesEstoppel.-A., who was the owner of a business entered into an agreement whereby the business was to be taken over by a company to be formed for that purpose; and A. was to receive in return a number of fully paid up shares in the Company. Prior to the formation of the Company B. agreed to puchase from A. a number of those shares and paid him the amount of the purchase money. On the incorporation of the company A., who became its managing director, procured the allotment by the Company to B. of shares to the number agreed upon. The Company did not receive any money payment in respect of those shares and there was nothing to show whether or not the shares were allotted as part of the number which A. was entitled to receive from the Company. A share certificate certifying that he was the holder of fully paid-up shares, was subsequencly issued to B. by the Company, and was accepted by B. in the belief that the Company had received value for the shares. Held, that if A. had, by virtue of his position as managing director of the company acquired any knowledge that the company had not received value for the shares, he did not acquire such knowledge while acting as B.'s agent for the purpose of procuring the shares, or in his capacity as such an agent; and that the Company was estopped, as against B., from

alleging that he was not the owner of fully paid up shares as stated in the certificate. In re THE HOUSEHOLD SUPPLIES PROPRIETARY LIMITED; Ex parte McKAY 45 A.L.T. 96. [Victoria.]

Shares-Transfer- Refusal to register transfer-Discretion of directors-Articles of association Companies Act 1863 (Q.) (27 Vict. No. 4), ss. 21, 34.-One of the articles of association of a company provided that the directors might refuse to register any transfer whatever of any shares without assigning any reason therefor. A member of the company purchased certain additional shares, and duly forwarded to the company transfers to her nominees of those shares with the request that the names of the transferees be entered in the register of members. Registration was refused by the directors, and no reason for the refusal was given. The members of the company were divided into two sections. One section was supported by all the directors except one. If the transfers had been registered the other section, which was supported by the purchaser, would have obtained a controlling voting power, and by the exercise of that power would probably have been able to secure the election as director of the purchaser's husband, who had once been a solicitor of the Supreme Court of Queensland, but had been struck off the roll. After the refusal to register, the directors gave notice of a proposed resolution authorising the issue of new shares of which a number were to be disposed of to such persons as the directors might decide. that resolution were passed and shares issued to supporters of the first section, that section would probably have retained a majority of voting power notwithstanding that the transfers in question were susbequently registered. Held, that the onus of proving that in exercising their power of refusal the directors had not acted honestly or bona fide in what they considered the interests of the company, was on the person challenging their decision, and that no inference of impropriety could be drawn from their refusal to give reasons for their decision. Held, on the evidence, that the purchaser had not discharged that onus, and, therefore, that the Court had no jurisdiction to interfere. The necessary allegations and admissible evidence where want of bona fides in exercising a power is relied on, discussed. In re Australian Metropolitan Life Assurance Co. Ltd. (1923 S.R. (Q.) 120) reversed. AUSTRALIAN METROPOLITAN LIFE ASSURANCE CO. LTD. v-. URE AND ORS., 33 C.L.R. 199: 30 A.L.R. 53. High Court.]

If

Contributing shares-Payment of calls by bonus dividends-Increase of capital-Issue of new shares-Payment by bonus-Option -Shares held upon trust-Tenant for life and remainderman-Capital or income.-The trustees of a testator's estate held shares in the R. Coy. and the K. Coy. upon trust for tenants for life with remainder over. The R. Coy., at various times, made calls in respect of certain contributing shares and sim

ultaneously, out of its undistributed profits, declared dividends, which in some cases were payable on the date of the call and in other cases a few days later than the call. In a few cases the call had not been made in strict accordance with the articles of association of the company. The dividends in respect of the trust shares were in every case appropriated in payment of the respective calls. Held, that the dividends formed part of the capital of the testator's estate. In re Halton ([1917] 1 Ch. 357) followed; Perpetual Trustee Co. v. Cohen (16 S.R. 242) not followed. The K. Coy. on two occasions, increased its capital by issuing new shares, which were offered to shareholders in proportion to their share-holdings, and simultaneously a bonus was declared out of accumulated profits equal in the one case to 4/5 of the amount, and in the other case to the full amount, payable on the share, which bonus, if no direction to the contrary was given by shareholders, was to be applied on a certain date in each case in payment of the sums respectively due on each share allotted to shareholders. These offers were made on the terms that if not declined on a certain date they would be deemed to have been accepted and they were also subject to a provision that the company might dispose of all shares declined by members and distribute the amount of the premiums obtained, pro rata, among the shareholders who had declined to accept the shares.

Thereafter

the trustees were allotted the estate's proportion of the new shares. The shares of the company were at all material times at a premium. Held, that the bonus in these cases was income and not capital of the testator's estate. Mitchell v. Hart (19 C.L.R. 33) applied. GUAZZINI v. PATESON, 24 S.R. 40; 40 W.N. 142. [New South Wales.]

"Corporation "Person", Natural or artificial person-Person preparing instrument in writing relating to real estate.— The word " person " in s. 41 of the Supreme Court Act of 1867 includes a company. THE KING V. POLICE MAGISTRATE AT BRISBANE & BLOCKSIDGE & FERGUSON LIMITED ; Ex parte HENRY NORMAN KNOTT, 1924 S.R (Q.) 223; 18 Q.J.P.R. 116. [Queensland.]

Same case on another point, JUSTICES, col. 251.

Dairy company-Moneys advanced to shareholder against prospective bonus-Erroneous balance sheet-No profit -Recovery of advance. Plaintiff company expected to pay a bonus of 44d. per lb. of butter fat supplied and the directors' report to the company when presenting the balance-sheet for the year 1920-21 mentioned this amount as the prospective bonus. The new directors, however, found that a bonus of 1d. per lb. was all that could be paid. On a claim by the company against a shareholder for money advanced against the prospective 41d. per lb. and a counter-claim by the shareholders for payment of the bonus. Held, that shareholders could not take advantage of an erroneous balance sheet and that judgment

must be for the plaintiff on claim and counterclaim. TE HORO CO-OPERATIVE DAIRY Co. v. KING, 19 M.C.R. 18. [New Zealand.]

Companies-Profits of dairy companyShares in lieu of cash bonus-Capital increased by levy on supplier-shareholder's profits— Acquiescence Estoppel Discretion of directors. The defendant company's balance sheet for 1919-20 showed that a bonus of 1d. per pound butter fat supplied would be distributed amongst supplier-shareholders. As sufficient cash was not available for this distribution, a meeting of the company was convened at which it was decided to allot interest-bearing shares to suppliers in lieu of the cash bonus. Plaintiff, a supplier-shareholder, was later formally notified that he had been allotted forty-four fully paid up £1 shares, and his name had been entered in the company's register for the same. Later still he received and retained interest on all his share capital in the company. He did not protest against the allotment, nor take steps to have his named removed from the register in respect of the forty-four shares. In June, 1921, the directors circularized the shareholders with a proposal for the increase of the company's capital to enable them to erect and equip a dried-milk factory. This proposal was subsequently consented to at an extraordinary general meeting of shareholders, at which special care was taken in ascertaining how many shareholders objected, and who they were. The dissenters were asked to send in their names to the company's office, and some twelve did so, but plaintiff's name was not amongst those sent in, nor was it shown that he voted against the proposal at the meeting. At various dates in 1922 statements were sent to plaintiff showing amounts retained and credited to his account, and the company's balance-sheet disclosed that a certain percentage was being retained from supplier-shareholders in terms of the original proposal. In November, 1922, the plaintiff first took exception to this retention. Held, that plaintiff was estopped by his own conduct in each case from averring that he did not consent to the allotment, and therefore could not repudiate. Semble, that it was for the directors to decide whether or not there were profits available for distribution amongst the suppliers. It might be that the profits were represented by stock in hand and plant, buildings, and machinery, and that it was inexpedient or impossible to produce the cash necessary to make an actual distribution of the apparent profits. The directors having in their discretion decided against a distribution, that precluded a shareholder from suing for his share of the apparent profits.. Burland v. Earle ([1902] A.C. 83) applied. BROOK v. CAMBRIDGE CO-OPERATIVE DAIRY Co. LTD., 1924 N.Z.L.R. 602. [New Zealand.]

Trading with the enemy-Enemy company -Business in Australia directed to be wound up-Interest on debts owing by company.Pursuant to s. 9H of the Trading with the Enemy Act 1914-1916 the Minister for Trade