Ritchie, Q. C.--This is an action for calls, under section 34 of chapter 5 of the Dominion Acts of 1871. The plaintiffs have brought themselves within the requirements of this Act. The President proves defendant a shareholder, liable for allthe calls. It is contended on the other side that no registration of shares is good, unless with the consent of the transferee. Defendant's own letter in evidence admits that he was owner of five shares. He paid previous calls, and received dividends. Cites 7 M. & W., 574; 2 Q. B., 281; L. R., 5 Ch., 489.

We have proved notice of the call for thirty days in a Halifax paper, and in the Liverpool "Advertiser," but not a notice for thirty days by circular to shareholders. Circulars were sent, but are not proved to have been sent thirty days before the time of payment. The Act is complied with, however, as thirty days notice of the call was given in the papers. We have an admission from defendant that he received previous circulars. We have the evidence of a clerk that he sent circulars of every call to every shareholder of the bank. That makes a prima facie case, and the defendant has not denied receiving a circular.

McCoy, Q. C., contra.--The principal question is, was this man a shareholder? We have pleaded fraud; the Bank was virtually bankrupt. The defendant might be holder of these shares, and not responsible to the Bank. There is not to-day on the bank books any transfer of shares to this defendant, nor any acceptance by him, as required by the Act.

As to notice, the plaintiffs have to prove that it was given in conformity with the resolution. The statute fixes the time at thirty days, and the resolution prescribes the mode; but the modes prescribed in the resolution are all subject to the statutable direction as to time. The resolution requiring the call was not passed by the requisite number of directors. The Act making three a quorum refers only to the ordinary business of the Bank, the discounting of notes, &c. The resolution here was equivalent to a by-law, in prescribing the call and mode of notice; it was passed at a meeting when only three directors were present, out of seven; it should have been passed by at least four, a majority of the directors, the number mentioned in the thirty-third section of the Act.

One of the calls was invalidated by the act of the direc tors appointing a man, Joseph Innes, as a director, who voted for the call. The Act specifies that in case of a vacancy in the list of directors, the vacancy shall be filled in the manner prescribed by the by-laws; but there were then no by-laws. Innes was voted a director by three directors only; four might have passed a by-law and elected him. Cites 3 Exch., 407; 4 DeG. J. & S., 191; 2 Exch., 118.

The fact of receiving dividends does not prove defendant a shareholder, any more than his paying previous calls. If it did make him a shareholder, it should have been pleaded. There is no such thing as estoppel here. Cites 1 Lindley on Partnership, 138, 657; 4 H. & N., 160, 580; 7 C. B., N. S., 799 to 809; 6 C. B., 349 to 356; 4 Exch., 699; 2 Exch., 125; 7 M. & W., 260; 3 Exch., 402. As to the question of estoppel, 1 Best & Smith, 632 to 634; L. R., 9 Ch. Ap., 22; 6 Bingh., N. C., 135; Roscoe's N. P., 1161; Fisher, 7197; 2 Lindley on Partnership, 920.

Ritchie, Q. C.-The English Act on this subject is 8 & 9 Vic., c. 16. See B. & L., 141.

Weatherbe, Q. C.-This is simply a question whether a statute has been complied with. It is not for the jury. Even if a verdict had been given it would have been set aside. Section 34 requires proof that the defendant was a shareholder and this statute does not abrogate anything necessary to the proof of that, except that it provides that a shareholder may be a witness in the case. I suppose that it is inserted to meet the law in Quebec, which to-day would preclude a shareholder from giving evidence were it not for this act. That does not, however, take away the necessity of proving that the defondant was a shareholder. There is no proof of that here except his letters. Dr. Forbes swears he knows he was a shareholder, because his name was on the roll. That is no evidence, and if a verdict had been given on that evidence, it would be set aside. Their placing him on the roll does not make him a shareholder. The question is, were the shares legally transferred to him? Forbes says he does not know it from the original subscription book, or the transfer book. The way to prove the transfer would be to produce the trans

fer book, which they did not produce. The transfer was not legal according to the statute. Even if he admitted he was a shareholder, if he was not in fact legally so he would not be bound by his admission. (McDONALD, J.-Unless he was estopped.) Not only is he not proved to be a shareholder, but he is proved not to be unless he can be shown to be by his own admissions in his letters. In those he simply says that he purchased them, not that he has become legally liable for them. He never got a certificate of stock. He could not get a certificate with the books in the condition they were. Suppose that upon his writing as he did, they had replied, as they might have done, that he was not the legal transferee of the shares, that he was not a legal shareholder. In that case he certainly would not be the holder of them. The correspondence is without prejudice. He simply asked for information in the first letter. In the next he asked for a certificate, and he never got it. (DESBARRES, J.-Can we not infer that he got the certificate from the fact of his sending his check for his calls. JAMES, J.-They paid him a dividend, and so altered their position. Is not that an estoppel?) I go this far, that we could recover the money back that was paid, because there had been no legal transfer of the shares. There is no identification of the shares as to which the admissions. in the letters are made with the shares on which the action is brought. Innes was not legally a director. See Interpretation Act, 1867, section 7, sub-section 27. He was not legally appointed, and it is no answer to that to say that others were there who were legally so. (YOUNG, C. J.-If three directors could make a call, and four were present, including Innes, does it make any difference if Innes was not legally a director?) In the first place, we contend there were only two there. But further, we contend that Innes being there, and seconding the motion, made it an illegal act.

The notice is not proved. (Refers to evidence.) The circular initialled by the Judge was never tendered in evidence. Newspaper notice is not enough, unless made so by statute. A circular should have been shown to have been sent thirty days beforehand.

Ritchie, Q. C., in reply.-The question of the insolvency of the Bank has nothing to do with this matter. It can sustain an

action against a shareholder, even if insolvent. But the Bank resumed specie payment, and paid every claim against it within ninety days. The English Act is 8 & 9 Vic., c. 16, sec. 23. Our Act enables us to prove that the defendant is a shareholder by any one witness. We have not to show that he is a registered shareholder. Dr. Forbes proves that he was a shareholder.

The transfer book was produced, the counterfoil, and it is in proof that the papers torn off were signed by the transferees, and sent to Farquhar & Forrest to be accepted by the defendant, but were never received back. He was sued for previous calls, and actually paid them after being sued. He also received dividends.

The cases I have cited show a clear right in the plaintiffs to recover. The case cited contra, 4 H. & N., is peculiar. There was a special clause in the Act stating that the defendant was not to be deemed to have accepted shares unless he did so in a particular form, which was not complied with. The case in 7 C. B., N. S., does not touch this at all, because they put a person's name on the Register without any authority at all.

The circulars are in as much as the letters. They must be in evidence, because a cross-examination took place upon them. Marshall was examined with these papers in his hands. They were put in as printed forms, similar to those filled up and sent out. They were not presented as exact copies.

Under the Act three directors were a quorum for all business. The only restriction is as to passing of by-laws. There were more than three directors for the first call; and three, the legality of whose position was not questioned, ordered the second call. The fact that Innes seconded the motion is of no consequence, as a motion was not necessary.

This is a case of a Bank proceeding to collect from its own stockholders for the benefit of outside parties.

Under the English Act a special notice to each shareholder is required; (see Roscoe, 1161,) but by the special acts of incorporation a general notice is usually made sufficient, and the authority just cited shows how liberally the law as to proof of notice is laid down. I admit that if it is required

that the notice should be mailed thirty days before the call, we have not proved that, but it is not to be presumed that the notices were not sent before the call.

SIR WILLIAM YOUNG, C. J., now, (March 12th, 1878,) delivered the judgment of the Court:

This action is brought for two calls, each of ten per cent. on fifty-five shares, alleged to have been held by the defendant in the Liverpool Bank, incorporated by the Dominion Legislature, and governed by the Dominion Act of 1871, 34 Vic., ch. 5. The form of action is prescribed by sec. 34, and various defences were put in, which, upon the trial and argument, resolved themselves into two.

First; was the defendant a shareholder at the respective times the calls were made?

Secondly; were the calls duly made by the Directors, and was the defendant duly notified thereof?

The defendant was not an original shareholder, but a purchaser in November, 1872, and the 19th section of the Act provides, "that no assignment or transfer shall be valid, unless it be made and registered and accepted by the party to whom the transfer is made, in a book or books to be kept by the Directors for that purpose." Several books were produced at the trial, but none of them at the argument, and I learn their contents only from the Judge's minutes. There was a stock journal in which the defendant's name appears, and a transfer book, in which there is no transfer or assignment signed by the transferor to the Defendant, but a countervail showing that the transfer was effected, but no transfer or assignment registered or accepted by the defendant. It follows that there was no valid transfer under the Act and the numerous cases cited at the argument on the Imperial Public Companies' Acts, 8 and 9 Vic., chap. 16; and 25 & 26 Vic., chap. 89; and the Joint Stock Companies' Acts of 1856 and 1857. The question then is, has the defendant under another set of decisions precluded himself from setting up this defence. He bought the fifty-five shares shortly before 22nd November, 1872, as appears by his letter. In January, 1873, he paid a call of 10 per cent., and has paid 65 per cent. in all on these shares. In March, 1873, he gave a receipt for a dividend of four per

.