the election. The return went on to allege specifically a compliance on the part of the chairman with the provisions of the statute relating to the election of members, and that the defendant and five others were duly elected. Sixth replication-That after the notice of the election was published by Joseph Pease, and before the alleged election was held, as in the plea mentioned, he absented himself from and left the district and went to Ireland, and remained there till long after the alleged election, and there signed the certificate in the plea mentioned, in the manner hereinafter mentioned, and as such returning officer and chairman did not on the day immediately following the day of the election, or on any other day immediately succeeding the last-mentioned day, attend at the office of the local board of health, and did not ascertain the validity of the votes by an inspection of the ratebooks and such other books and documents as he might think necessary, and by examining such persons as he might see fit, or in any other manner; and did not cast up such of the votes as he found to be valid may require), shall have the powers and perform the duties vested in or imposed upon the chairman by this act in relation to any such election, and shall perform all other duties which it may be requisite for him to perform in conducting and completing elections under this act; and in case the office of chairman shall be vacant at the time when any such power or duty must be executed or performed, or in case the chairman or person appointed as last aforesaid, from illness or other sufficient cause, shall be unable to exercise or discharge such powers or duties, or shall be absent, or shall refuse to act, some other person who shall be appointed (in case of the first election) by such Order in Council or provisional order, or (in any other case) by the local board of health, shall exercise or perform such of the said powers and duties as then remain to be exercised or performed; and the local board, or (in case of the first election) the person appointed by such Order in Council or provisional order, shall, before or during the election, appoint a competent number of persons to assist and attend upon the chairman or the person so appointed (as the case may require) in conducting and completing the same." By section 26, "The chairman shall cause the voting papers to be collected on the day of election by the persons appointed or employed for the purpose in such manner as he shall direct." By section 27, "The chairman shall, on the day immediately following the day of the election, and on as many days immediately succeeding as may be necessary, attend at the office of the local board and to have been duly given, collected or recorded, and did not ascertain the number of such votes for each candidate, but absented himself wholly from the office at the time aforesaid, and suffered and permitted other persons to ascertain the validity of the votes and to cast them up and ascertain the number for each candidate, and he certified the candidates who had obtained the greatest number of votes merely on the faith of the report sent to him by the said persons and not otherwise, and signed the certificate on the faith of such report, and that no other person was appointed by the local board of health (the election not being the first election) to exercise or perform any of the powers and duties vested in or imposed upon the chairman of the local board in relation to the election, nor did the local board before or during the election appoint a competent number of or any person or persons to assist and attend upon the chairman in conducting and completing the election. Rejoinder-That the local board before the election appointed a competent number of persons, to wit two persons, that is to of health, and ascertain the validity of the votes, by an examination of the rate-books and such other books and documents as he may think necessary, and by examining such persons as he may see fit; and he shall cast up such of the votes as he shall find to be valid, and to have been duly given, collected or received, and ascertain the number of such votes for each candidate; and the candidates to the number to be elected who, being duly qualified, shall have obtained the greatest number of votes, shall be deemed to be elected, and shall be certified as such by the chairman under his hand; and to each person so elected the chairman shall send or deliver notice of such election; and the chairman shall also cause to be made a list containing the names of the candidates, together with (in case of a contest) the number of votes given for each, and the names of the persons elected, and shall sign and certify the same, and shall deliver such list, together with the nomination and votingpaper which he shall have received, to the local board of health at their first or next meeting (as the case may be), who shall cause the same to be deposited in their office, and the same shall during office hours thereat be kept open to public inspection, together with all other documents relating to the election, for six months after the election shall have taken place, without fee or reward, and the chairman shall cause such list to be printed and copies thereof to be affixed at the usual places for affixing notices of parochial business, within the parts for which the election shall have been made." say, one Hugh Dunn and one William Hildreth the younger, to assist and attend upon the chairman in conducting and completing the election, and the chairman, who by reason of defect in his eyesight, was unable by personal examination of the rate-books or other books or documents to ascertain the validity of the votes, or personally to cast them up, conducted the election by the said Hugh Dunn and William Hildreth the younger, and with their assistance, and did by them, at the time and place in the plea alleged, attend at the office of the local board of health, and did then and there, by them and by their examination, conducted according to and in pursuance of the directions of the said Joseph Pease, and communicated to him before he signed the certificate of election, ascertain the validity of the votes, and nothing occurred about or in or during or connected with the examination, which had not been provided for by the directions of the said Joseph Pease by him before given to his assistants, or which in any way required the judgment, personal interference or presence of the said Joseph Pease. And the said Joseph Pease did by them the said Hugh Dunn and William Hildreth the younger cast up such of the votes as on such examination were found to be valid and to have been duly given, collected or received, and did by them and with their assistance ascertain the number of votes for each candidate, and after he had so ascertained the same, did himself sign the certificate in the plea and sixth replication mentioned; and during all the time of the election the said Hugh Dunn and William Hildreth the younger had the means of immediate communication with the said Joseph Pease, and were directed by him to communicate with him if anything occurred requiring his judgment, personal interference or presence, and no such thing did occur during the election; and the said Joseph Pease during the election held himself in readiness to come to and attend personally at the place of election on receiving any such communication. And that the persons so appointed to assist the chairman did in all things appertaining to the election follow the instructions and directions of the chairman in respect of the election, and he did not suffer or permit NEW SERIES, 36.-Q.B. any person other than them to ascertain the validity of the votes, or to cast them up, or ascertain the number for each candidate, nor did he notify the candidates who had obtained the greatest number on the faith of anything other than as aforesaid; and that the defendant had not at the time of the election, nor until after he made declaration of his qualification and acted as a member of the local board, any notice or knowledge of the absence of the chairman from the place of election, or of any irregularity in the election. Surrejoinder by way of demurrer. Pickering (Quain with him), in support of the demurrer.-The election of the defendant was void. The absence of the chairman was fatal to its validity, and it could not legally have been conducted by the statutory assistants of the chairman. By the Public Health Act, 1848, s. 21, in case the chairman is absent during the time when his powers in conducting an election under section 27. should be exercised, some other person, to be appointed as the case may require, by Order in Council or by the local board, is to exercise these powers and perform the duties relating to the election. Here the chairman was absent, and it is admitted by the pleadings that no such deputy was appointed. The chairman's duties at an election, as prescribed by section 27, are eminently personal. He is to attend at the office on the day after the election to ascertain the validity of the votes by reference to the rate-books, to cast up the votes and to ascertain which candidate has obtained the greatest number. It was never intended to allow such duties to be delegated to the assistants, who were always meant to act under the direct surveillance of the chairman. This case came before Mr. Justice Crompton in the Bail Court (2), when that learned Judge expressed his decided opinion that the election was void, and that the duties of the chairman could not be delegated to the assistants, saying that it was just as if a barrister to whom a cause had been referred were to leave it to be decided by his clerk; or as if a Judge in chambers were to intrust his powers and duties to the Master. It is submitted that this view is perfectly correct. (2) 12 Law Times, 579. с Manisty, in support of the rejoinder.-The election is valid. The personal absence of the returning officer, when the votes were cast up and the majorities ascertained, did not in itself render the election void, particularly with regard to candidates who had no notice of any such irregularity. It appears from the pleadings that nothing occurred on the occasion in question which called for the personal interference of the chairman. It is quite clear that under section 26, the collection of the voting papers, an important task, need not be conducted in person by the chairman. LUSH, J.-The language of that section is very different from that of section 27.] The assistants appointed in pursuance of section 27. may reasonably perform such ordinary duties as the casting up of votes, subject always to the supervision of the chairman. Per Curiam (3).-The chairman being absent and no deputy having been ap pointed, it cannot be said that the election was conducted by either one or the other; and it is therefore void. Judgment for the relator. that the defendant agreed with certain of the creditors, other than the plaintiffs, in consideration of their respectively executing the deed, to give them certain pecuniary and valuable benefits and preferences over the other creditors; that thereby he induced the said creditors to execute the deed, which execution was procured without the knowledge or consent of the plaintiffs, and in fraud of the deed and of the plaintiffs :Held, upon demurrer to this replication, that it was an answer to the plea, inasmuch as a composition deed cannot be binding, if it is not executed in good faith between the debtor and his creditors. Declaration upon the common money counts. The third plea stated, that after the accruing of the causes of action in the declaration mentioned, by a deed made between the defendant, therein described as of Melbourne, in the colony of Victoria, Australia, of the first part, the plaintiff H. W. Dauglish, of the same place, and J. M. Joshua, of the same place, in the deed designated "the said trustees," of the second part, and the several persons and parties whose names and seals were subscribed and affixed in the schedule thereunder written, being creditors either in their own right, or as agents or attorneys for persons absent from the colony, of the defendant, of the third part, it was agreed that the defendant should convey and assign all his real and personal estate, &c. to the said trustees, &c., upon trust, for the benefit of all the creditors, &c., under the Composition Deed-Execution by Cre- provisions of an act of the Governor and ditors-Fraudulent Preference. Attorneys-Rogerson & Ford, Agents for H. J. 1866. Nov. 20. DAUGLISH AND OTHERS v. To a declaration containing the common money counts, the defendant pleaded that by a composition deed entered into by himself and four-fifths in number and value of his creditors, under the provisions of an act of the Legislative Council of New South Wales, he was released from all actions, &c., and that the deed had been executed by one of the plaintiffs in respect of the cause of action in the declaration mentioned. A replication upon equitable grounds, after setting out the deed, alleged (3) Cockburn, C.J., Mellor, J. and Lush, J. Legislative Council of the Colony of New South Wales, made and passed in the fifth year of the reign of Her Majesty Queen Victoria, No. 9, intituled An Act for the further amendment of the law and for the better advancement of justice,' &c. The plea then, after setting out certain provisions of the deed, alleged that "the several persons, parties thereto of the second and third parts, did thereby, for themselves respectively and for their respective partner or partners, heirs, executors, administrators and assigns respectively, if and when the said deed should have been executed by four-fifths in number and value of the creditors of the said defendant, pursuant to the said act of council, remise, release and for ever discharge the said defendant of and from all actions," &c. It then alleged that the deed had been, before this suit, executed by four-fifths in number and value of the creditors, and, amongst others, by the plaintiff H. W. Dauglish, in respect of the cause of action in the declaration mentioned; that at the time of the execution of the deed the defendant was resident and domiciled in the colony; and that the cause of action accrued there. The plea also contained a general averment of the performance of conditions precedent. The second replication on equitable grounds set out the deed, which was in the usual terms, and the part which was material for the point now reported was as follows: "And this indenture further witnesseth that, in consideration of the premises, the said several persons parties hereto of the second and third parts do hereby for themselves respectively, and for their respective partner and partners, his heirs, executors, administrators and assigns respectively, if and when these presents shall have been executed by four-fifths in number and value of the creditors of the said William Middleton Tennent, pursuant to the said act of council, remise, release and for ever discharge the said William Middleton Tennent of and from all actions, suits, causes of action and suits, debts, covenants, bonds, claims and demands whatsoever, which the said parties hereto of the second and third parts respectively now have, or but for these presents might have, upon or against the said William Middleton Tennent, upon any account whatsoever. In witness thereof," &c. The replication then went on to allege that certain schedules were subjoined to the said deed as therein referred to, which it is not material to set out at length; and that the plaintiff H. W. Dauglish executed the said deed on the faith of the several provisions therein contained, but the said deed was never executed by any of the other plaintiffs, and the defendant agreed with certain of the creditors of the defendant referred to in the third plea respectively, being other than the plaintiffs or any of them, to pay or give, or secure to such creditors respectively, in consideration of their respec tively executing the said deed, certain pecuniary and valuable benefits and preferences over the other of the said creditors of him, the defendant, and thereby induced such preferred creditors to execute the said deed, which said agreement was so made, and which execution by such preferred creditors was so procured in manner aforesaid, without the knowledge, consent or authority of the plaintiffs or any of them, or of the creditors of the defendant mentioned in the said plea, other than the said preferred creditors, and contrary to and in fraud of the said deed and the plaintiffs, and the said other unpreferred creditors, and the laws of the said colony; and the defendant procured the said deed to be executed by such majority as in the said plea mentioned, by and through the said fraudulent agreement and premises in this replication aforesaid, whereby the said deed, by and according to the laws of the said colony, never released or discharged the defendant from the claim sued for in this action. Demurrer and joinder in demurrer. Quain, in support of the demurrer.This is an ordinary composition deed executed by one of the plaintiffs. The plea sets up the deed as a defence to the action, and the replication is no answer to it. It may be, as was held in Wilson v. Ray (1), that if the money is paid to a creditor by the debtor for the purpose of inducing him to sign the deed, the money cannot be recovered back; but the contention of the plaintiff here is, that because some of the creditors were induced by promise of benefits and preferences, the whole deed is bad altogether. No creditor who has been preferred could dispute this deed and how can it be said that others who are no parties to the alleged fraud can do so? But, further, the replication is bad for not shewing that the plaintiffs are put in a worse position by what has taken place. All the assets are to be distributed, and there is no allegation that the amount of the assets has been at all diminished. It is consistent with everything alleged, that the benefits and preferences mentioned may have been payments to be made by relations or (1) 10 Ad. & E. 82; s. c. 8 Law J. Rep. (N.s.) Q.B. 224. friends of the defendant, so that the whole estate would still remain to be distributed. [MELLOR, J.-But is it not one of the ingredients of these compositions, that all the creditors should be placed upon an equality?] If that be so, the plaintiff is only entitled to his fair share with the others of the amount of the assets, and it is not shewn by the replication that he would get less than that full share. Again, the replication does not shew that the plaintiffs executed the deed on the faith that the rest of the creditors would execute on the same terms as himself. [LUSH, J.-It is consistent with this replication that four-fifths might have executed the deed honestly.] Yes, that is so; the creditors with whom the agreement was made may have been the remaining one-fifth. In Mallalieu v. Hodgson (2) the plaintiff had been induced to sign a composition deed upon the faith of the defendants' promising to pay him dividends at a greater rate than the other creditors were to receive; and the defendants stated to him that no other creditors would have the same preference. Having brought an action against the defendants, he endeavoured to set up this statement of the defendants as an answer to their plea that they were released by the deed, but it was held by Mr. Justice Coleridge and Mr. Justice Erle, a majority of the Court, that he could not so allege a deception on himself by the defendants in the execution of a fraud by himself and them upon the other creditors. At p. 711, Mr. Justice Erle is stated to have said, in his judgment, "Each creditor consents to lose part of his debt in consideration that the others do the same; and each creditor may be considered to stipulate with the others for a release from them to the defendants in consideration of the release by him. When any creditor in fraud of the agreement to accept the composition stipulates for a preference to himself, his stipulation is altogether void; not only can he take no advantage from it, but he is also to lose the (2) 16 Q.B. Rep. 689; s. c. 20 Law J. Rep. (N.5.) Q.B. 339. benefit of his composition." If it was shewn that the estate would not be fairly dis tributed among all the creditors, the replication might be good; but that is not shewn. Sir George Honyman (Murphy with him), contra.-The plea shews that there was to be a release to the defendant if fourfifths in number and value executed the deed, and the plaintiffs, in their replication, answer that the execution of some of the creditors had been obtained by fraud, and therefore that the event upon which the release was to take place had not occurred. The foundation of all such deeds is this: a debtor says to his creditors, "I am unable to pay you in full, but I can pay so much in the pound, and if you will release me, I will put you all upon an equality." Each creditor gives up part of his right on the assumption that all the others are doing the same, and that all will be paid equally. But if a bargain is made with some of the creditors only that they are to receive some special advantage, it is a fraud upon the others, and they are not bound. The cases which have occurred as to creditors being induced to sign a bankrupt's certificate are in point-Robson v. Calze (3), Holland v. Palmer (4) and Phillips v. Dicas (5). The last case was Hemming v. Pugh (6), where the Court held that the signatures of creditors who received more than the others could not be taken into account. There can be no release unless the requisite number are got to execute the deed bona fide. The fraudulent creditors are not bound, for a man may set up as a defence his own fraud with the fraud of the other party-Higgins v. Pitt (7). The maxim potior est conditio defendentis applies. Quain replied. COCKBURN, C.J.-I am of opinion that our judgment ought to be for the plaintiffs. The defendant takes his stand upon the composition deed; and it is objected by the (3) 1 Dougl. 228. (6) 1 New Rep. 239. (7) 4 Exch. Rep. 312; s. c. 18 Law J. Rep. (N.S.) Exch. 488. |