and, under the scheme by which the new company was formed, as such creditors received a small dividend and a number of "B" or deferred debentures, by way of composition for their debt. The Aberdare Company did not make sufficient profits to pay off the contemplated instalments of Messrs. Hankey's mortgage, and negotiations were entered into by the bank represented in the negotiations by their chairman, Mr. Murch, and a supposed Scotch syndicate, represented by Mr. James Morton, for the purchase from Messrs. Hankey of their mortgage at a discount. It was considered desirable by the purchasers to come to this arrangement because they were largely interested in sustaining the Aberdare Company as holders of "B" debentures. The negotiations resulted in an arrangement under which three documents were prepared(A) a deed by which Messrs. Hankey were to transfer their mortgage (on which nearly £180,000 was then due) to trustees, two on behalf of the bank, two on behalf of Mr. James Mortou or his syndicate, in consideration of £100,000, half of which was to be paid by the bank; (B) a declaration of trust as to a sum of £20,000 which was to be deposited with the trustees to indemnify Messrs. Hankey against covenants they were liable to on mining leases as trustees of the estate of Fothergill and Hankey; and (C) a deed of indemnity that was to have been executed by two gentlemen of the name of Lewis, and who were to receive £5,000. The plaintiffs pleaded that it was a part of the arrangement that a large number of holders of the "B" debentures should provide money for the purposes of the Aberdare Company called "the developing capital." On the 25th of September, 1878, a sum of £50,000 was paid to Messrs. Hankey and a memorandum of agreement was signed which provided for the execution by Messrs. Hankey of the transfer on payment of the £50,000, the deposit of the £20,000, and the execution of the indemnities. That agreement was signed on behalf of the bank and by a member of the firm of solicitors acting for them in the matter. The remaining £50,000 was to be paid on the 1st of November, 1878, or within three months, with interest. In October, 1878, Mr. James Morton took proceedings to liquidate his estate under which he was made bankrupt. The plaintiff company went into liquidation in December, 1878, and nothing more was done towards getting the transfer of the mortgage completed. The plaintiffs sought in the first place to have it declared that the arrangement was not binding on the bank, both by reason of its being ultra vires and of its being unauthorised, and to get their £250,000 back again, or, inasmuch as the contract had become impossible to be fulfilled, to get their money back on that ground. There was also an alternative claim for specific performance, which counsel for the plaintiff did not press on account, as they said, of the difficulty of asking for and putting in evidence to support the inconsistent claims. Mr. Justice Fry said the nature of the transaction-namely, taking a transfer of a mortgage-was clearly one within the ordinary scope of a banking business, nor did the fact of the deposit being made invalidate it. If the form of the bargain had been reversed, if the purchase-money had been £120,000, with a stipulation that in certain events £20,000 should be returned, no one would have suggested that it was ultra vires. Then it was said that the transaction was bad because it was part of a larger transaction under which "developing capital" was to be found. Messrs. Hankey had nothing to do with that, and could not be affected by it. The next point his lordship dealt

with was one raised in argument only and not properly before him, that the contract had not been entered into by the directors. He considered it was at least shown that they had ratified it, especially as a sum of £25,000, money of the bank, had got into the hands of Messrs. Hankey, which it would have been the directors' duty at once to get back if they objected to the bargain. His lordship lastly considered the case made by the plaintiffs on the ground of the impossibility to carry the arrangements into effect. He said it might be that there were cases where a purchaser who had paid part of his money was entitled to get it back if the contract could not be carried out. That would be the case where default was made by the vendor, and there might be other cases; but this was not one. The plaintiffs had not shown that they, on the 1st November, 1878, the day fixed for completion, or at any other time, were ready and willing to carry out their part of the performance. They were in liquidation, and could not proceed without the leave of the court, which had not been obtained. They were not now ready. They had not shown that if they had been able to do their part of the contract it would not have been carried out, and must be taken to be in default. He dismissed the action, with costs, without prejudice to any steps to be taken by any party to have the arrangement specifically performed.

AT the Oxford Circuit Winter Assize, held at Hereford on the 3rd ult., was heard before Mr. Justice Lopes and a special jury the case of the

NATIONAL PROVINCIAL BANK OF ENGLAND V. WEAVER,

This was an action upon a guarantee for £500, which the defendant had signed as surety for one Sampson, a customer of the plaintiffs, who had become insolvent, and the action was interesting by reason of the defence set up that the defendant had been induced to sign the document through what in effect was the fraud of the bank manager, a gentleman who had occupied that position at Leominster for 19 years. The account given by the bank manager, who was the first witness called, was as follows:-Sampson, who was an auctioneer, had had an account for some time with the bank, and upon the guarantee of a friend had been allowed to overdraw to the extent of £400. In June, 1880, this friend died, and the defendant with three others, became sureties in his place, and they together signed a joint and several guarantee for £500. Before they signed, the defendant and one of the sureties called at the bank, when the document was prepared in their presence and the bank manager explained its nature, telling them that each surety made himself liable for the full amount of the guarantee. The document was then handed to the two sureties and duly signed. In April, 1881, it became necessary to demand payment upon the guarantee, and the defendant was applied to with the others. He asked for time, and time was granted, and many interviews took place, at none of which was it ever suggested by the defendant that he had been induced to sign by fraud. Since then one of the sureties had allowed judgment to go by default; another being insolvent was not proceeded against; and a third was abiding the result of this action. Mr. Matthews, in opening the defendant's case, said the defence of course was not that the defendant

was not aware of the contents of the document, though as a matter of fact he was not, but that there had been a misstatement by the bank manager of a material fact, or at least a concealment of it, by which the defendant was induced to sign, and if this was so, there was legal authority for saying The that the document was vitiated, and was therefore not binding. defendant was then called to substantiate this. He said he had been master of the Leominster workhouse for 19 years, and that before he signed the guarantee he made inquiries at the bank as to Sampson's solvency, and was told that he was "all right," and that he (the defendant) was only required to sign as a matter of form. Upon this the defendant said if it did Sampson good and himself no harm he would sign. He was afterwards handed the document, but nothing was said at the time to make him understand that he was liable for £500, or that the guarantee was joint and several. And it was not till afterwards that he found out that when this was said Sampson's account was really overdrawn. The learned Judge in summing up, said the issue which had been raised made the case one of importance, but they could only find for the defendant if they were satisfied that the manager, intending to mislead, either misrepresented or concealed the state of Sampson's account, and that the defendant was thereby induced to sign the guarantee. The jury, after a few moments' consultation, returned a verdict for the plaintiff for the full amount.

IN the Queen's Bench Division, on February 14th, Mr. Justice Cave delivered written judgments in the two following cases :—

MANCHESTER AND LIVERPOOL DISTRICT BANKING COMPANY (LIMITED) V. HALL AND OTHERS.

This case, which was an action brought by the plaintiffs on two guarantees for £15,000 and £5,000 respectively against the defendants-two of whom were the guarantors and the remainder the representatives of four other deceased guarantors-came on for hearing before his lordship and a special jury on November 11th last. As it appeared that there was not likely to be any contest as to the facts, the jury had been discharged by consent, power being reserved to his lordship to find as to any material facts that might prove to be in issue. A large number of eminent counsel were engaged by the parties. The business of Messrs. John Elce and Co., machine makers, was previously to 1865 made into a limited company, of which all the defendants or those whom they now represented had been directors. This limited company had a banking account with the plaintiffs, who in 1865, on a guarantee by four of the directors, had consented to an overdraft. Early in 1871 the bank consented to grant to the company one of £15,000 on the joint and several guarantees of all the six defendants. There was in this guarantee the following condition :-"That the guarantee or engagement shall be considered a continuing guarantee and shall not be withdrawn, but shall continue in full force until fourteen days after notice to your manager or one of your managers in Manchester in writing, under our hands of the intention to discontinue or determine the same.' There was in it also a provision that the guarantors would pay the moneys guaranteed after one month's notice from the bank. An overdraft having

therefore been allowed by the plaintiffs, Mr. Blacklock, one of the guarantors, died on August 19, 1871, and notice of his death had been given to the bank two days afterwards. At that date there was a sum of about £13,000 due from the guarantors to the plaintiffs. On August 24th the bank opened a new account in their books with John Elce and Co. (Limited) to which, after that time, all cheques drawn and all moneys paid in were debited and credited. All that had, in fact, been after that date done to the first account had been to debit and credit it with the interest every half-year down to 1880. On May 14th, 1872, Elce and Co. were allowed by the bank a new overdraft to the extent of £5,000 on this second account on a guarantee for that amount being signed by the then directors, viz., Messrs. Hall, Smethurst, Lord, Fletcher, and Ledward, who, with Mr. Blacklock, had all been guarantors of that allowed on the old account. On May 7th, 1872, a resolution had been passed to wind up the company, which had been confirmed on the 28th, and two of the guarantors were appointed the liquidators with power to complete existing contracts. The business in effect had continued to be carried on by the liquidators, resolutions authorising them to do so being passed from time to time down to 1880, when the bank had pressed for payment of the amounts guaranteed. On June 30 in that year the bank gave the defendants formal notice that they required payment of £15,163 under the first guarantee, and £6,498 under the second. On behalf of the executors of Mr. Blacklock, it was contended at the hearing, that as he had died in 1871, and the right of action of the bank against his executors in respect of the guarantee which he had signed conjointly with the other directors of John Elce and Co. (Limited) in 1865 had accrued at that date, their claim against his estate was barred by the Statute of Limitations. It had been contended on behalf of his executors that that which had passed between them and the bank in August, 1871, had been equivalent to a demand by the plaintiffs for payment under his guarantee. It had been further urged on their behalf that if the guarantee had not determined on the death of Mr. Blacklock, this had been the case when the company had gone into liquidation in 1872, and that the Statute of Limitations had at any rate commenced to run from that date. His executors had also claimed that they had been entitled to have had the payments subsequent to 1871 placed to the credit of the earlier account, and that if this had been done, as these credits had amounted to over £13,000, they would have exceeded the moneys due under the first guarantee, which alone Mr. Blacklock had sigued. On behalf of the other defendants, it was contended, among other things, that the Statute of Limitations would apply as to their liability under the first guarantee, and that as to their second guarantee it had been determined by the liquidation of the company. His lordship now gave judgment in favour of the executors of Mr. Blacklock, holding the claim by the bank against them to be barred by the statute. As to the alleged liquidation, he held that if it had ever been intended it had been abandoned, and would, therefore, not prevent the plaintiffs from recovering from all the defendants other than the executors of Mr. Blacklock. As to the contention that the liability of these defendants under the first guarantee had been discharged by subsequent payments into the account of John Elce and Co., his lordship held that it was untenable, as with their express assent these payments had been appropriated to the new account. Judgment was therefore given for the plaintiffs for

£18,192. 19s. 7d., with interest from July, 1880, against all the defendants with the exception of the executors of Mr. Blacklock, it being agreed that there should be no opposition to a stay of execution for any reasonable time.

BECKETE AND CO. V. ADDYMAN.

This was also an action brought by a banking firm on a guarantee. The plaintiffs, who are bankers at Leeds and other places in Yorkshire, obtained in 1867 a guarantee from the defendant and one Wright, since deceased, of the amount (up to £500) due on the banking account of Messrs. Grayson and Hardisty, machine makers at Leeds. Mr. Wright died in 1872, and some considerable time after his death Messrs. Grayson and Hardisty had gone into liquidation, being then indebted to the plaintiffs in a sum exceeding £250, the amount of the liability of each of the guarantors, Mr. Wright and the defendant. The plaintiffs having brought this action against the latter for that sum, the defendant had inter alia pleaded that the death of his co-surety, either of itself or when communicated to the plaintiffs, had amounted to a revocation of the guarantee, and that the statement of claim showed only advances made after the death of Mr. Wright, and for which he (defendant) would not be liable. The plaintiffs had demurred on the ground that the guarantee given by the defendant had not been determined by the facts as alleged by him in his statement of defence. His lordship held that the defendant had omitted to take such steps on the death of his co-surety as would have been necessary to determine the guarantee, and that the demurrer to his statement of defence must be allowed. He therefore gave judgment for the plaintiffs for £250 with costs.

MELBOURNE BANKS' CLEARING HOUSE TRANSACTIONS.
FOR THE QUARTER, OCTOBER TO DECEMBER, 1881.