palpable that there has been a mistake on which the settlement has been made, the Court will admit evidence to correct it."

7. MORLAND V. ISAAC. 20 Beav. 389.

Policy-Insurance by Creditor of Debtor's Life-Right to Surplus after Payment of the Debt.

The question sometimes arises, to whom does a policy of insurance-effected by a creditor or grantee of an annuity upon the life of the debtor or grantor-belong upon the death of the latter, or on the payment of the debt or the redemption of the annuity? In Morland v. Isaac a tradesman insured the life of his debtor in his own name, and charged the debtor with the premiums, but they were never paid by him. On the death of the debtor, it was held by Sir J. Romilly, M.R., that his representatives were entitled to the produce of the policy after payment of the debt and premiums. "This matter," said his Honour, "depends on the contract between the parties. This, however, may either be expressed in writing or by parol, or it may be inferred from the acts and dealings between the parties, from which a contract between them may appear.

"There is a distinction between an assurance to secure a debt and one to secure the payment of an annuity. In the case of an annuity, the grantee is at liberty to effect an insurance or not; it is a distinct contract, which diminishes his profits to the extent of the premiums, the amount of which the grantee cannot recover from the grantor. Thus, if the grantee of an annuity of 1007. a year pays for insurance, he cannot charge it against the grantor, but it must come out of his own pocket. The object of an insurance, in the case of an annuity, is to indemnify the grantee against the premature death of the grantor; and in such a case, it requires strong facts to bring one to the conclusion that it was incumbent on the grantec to keep it on foot, and to assign the policy to the grantor upon his redeeming the annuity. The case is different where a creditor insures the life of his debtor. If the creditor pays the premium out of his own pocket, the case is analogous to that of the annuitant; but if he makes the debtor pay them, the case is perfectly different." -(See and consider Gottlieb v. Cranch, 4 De G. M. & G. 440.)

8. EidsForth v. ARMSTEAD. 2 Kay & Johns. 333. Power of Sale by Implication-Charge of Real Estate with Payment of Sum of Money.

Where a testator has charged his real estate with the payment of a sum of money, he must be taken to have given an implied

power of sale to some person to raise the sum required, and the donee of the power must in such case be ascertained from the whole will. In Eidsforth v. Armstead a testator had devised his real estate to A. and B., their heirs and assigns, upon trust to pay the rents to the testator's daughter (a married woman), for her separate use for life, and after her decease to the use of the right heirs of his daughter; and the testator thereby charged the real estate with the payment of 7007. to his granddaughter. It was held by Sir W. P. Wood, V.C., that A. and B. had a power of sale during the life of the testator's daughter.

9. GRAY V. HAIG. 20 Beav. 219.-HAIG V. GRAY. Principal and Agent-Destruction of Vouchers-Spoliation-Presumption against Spoliator.

The case of Gray v. Haig affords an apt illustration of the maxim, omnia presumuntur in odium spoliatoris. There the Messrs. Haig, distillers, appointed Mr. Gray, a commission and general merchant, their agent, for the sale of spirits at a commission. Mr. Gray made profits by the sale of the spirits supplied to him by the Messrs. Haig, for which he had not given credit; he had also made a profit by selling his own spirits mixed with those of the Messrs. Haig, and had destroyed books of account pending litigation commenced by bill and cross bill between the parties for an account. Sir J. Romilly, M.R., held that Mr. Gray, in taking the accounts, was not entitled to 7,000l., the amount of commission, which, by the contract, he would have been entitled to if his conduct had been proper. "The principle," said his Honour, "on which I proceed is that to be found in White v. Lady Lincoln (8 Ves. 363), and in Lupton v. White (15 Ves. 432), which principle is undoubted; and the only question is, whether the facts of this particular case bring the matter within that principle. The principle may, for the present purpose, be thus expressed: if an agent deal with the goods of his principal as his own, making a profit out of them not accounted for to the principal, and if the agent, by his own conduct, has made it impossible to ascertain what the amount of the profit is which he realized, he shall not be allowed the commission which otherwise, and according to the contract, he would be entitled to claim.

"In the case of White v. Lady Lincoln (8 Ves. 363), the agent and manager of the property, who was also the solicitor, kept no regular accounts, or any papers from which such accounts could be made out; he kept all the vouchers which told in his own favour, but no evidence of the receipts in respect of which

he was to be charged. His executors were held not to be entitled, on his behalf, to claim against the principal the charges which, in other circumstances, he would have been entitled to make. Lord Eldon there says, 'With respect to Jackson's demand as auditor, steward, agent, and all, except his bills as attorney, as to all which he was bound to keep accounts of those transactions, I must lay down the rule, that a man, standing in a relation imposing a duty to keep regular accounts, cannot be permitted to make a demand for work and labour in that character with reference to which he has kept no account, which is justified by principle, that ought to be loudly published, that a receiver, who does not pass his accounts regularly, ought not to be allowed any poundage. That principle applies to all these demands, except the bills of costs.'

"In Lupton v. White (15 Ves. 432, 439), Lord Eldon laid down, that where an agent or bailiff confounds the property of his principal with his own, he will be charged with the whole, except what he could prove to belong to himself. Lord Eldon says, 'If a man, by his own tortious act, makes it impossible for another to ascertain the value of his property, and that in a transaction in which the former was not merely under an implied moral obligation, but pledged by a solemn undertaking in a court of justice, that such should not be the state of things between them, by these means preventing the guard which the Court would have effectually interposed, is the argument to be endured, that, as the party so injured cannot distinguish his property, therefore he shall have nothing? That is not the law of this country, as administered in courts either of law or equity.' And after referring to the case of the chimney-sweeper's boy who found a jewel (Amory v. Delamire, 1 Stra. 505), and other cases, he says, 'What are the cases in the old law of a mixture of corn or flour? If one man mixes his corn or flour with that of another, and they were of equal value, the latter must have the given quantity; but if articles of different value are mixed, producing a third value, the aggregate of both, and through the fault of the person mixing them, the other party cannot tell what was the original value of his property, he must have the whole; and the principle goes to the full extent of what is now contended.' By the decree in that case, the defendants, who had wrongfully worked an adjoining mine, and had kept no accounts, though they had entered into an undertaking so to do, were charged with the whole net produce of both mines, except what they should prove to have been taken from their own.

"In this case, the books which would have proved the clear state

of the accounts between the parties have been destroyed by Mr. Gray after the litigation had begun. Upon the evidence before me, I see proof that in several cases Mr. Gray made, on the sale of the goods of his principals, a profit, which he did not give credit for to them. . . . . That profits were made by mixing of the spirits, I consider also proved. The amount of those profits nowhere appears in the accounts before me, but would have appeared in the accounts destroyed. The means, therefore, of ascertaining the amount of them are removed by Mr. Gray. The observation I have already made, and which I had so often referred to on this subject, I refer to again;—it is most material in this part of the case, it is that which, in fact, has governed and occasioned my decision throughout the greater part of it; and I repeat again, that I will not send to be tried by a jury a question which is supported by competent evidence, and which, if untrue, could have been disproved by evidence in the possession of one party, which he has taken means to prevent from being made available for the determination of the question by the Court. .. It cannot be too generally known or understood amongst all persons dealing with each other in the character of principal and agent, how severely this Court deals with any irregularities on the part of the agent, how strictly it requires that he who is the person trusted shall act in all matters relating to such agency for the benefit of his principal, and how imperative it is upon him to preserve correct accounts of all his dealings and transactions in that respect, and that the loss, and still more the destruction of such evidence by the agent, falls most heavily on himself."-(See The Duke of Leeds v. The Earl of Amherst, 20 Beav. 239.)

10. CALEDONIAN AND DUMBartonshire JUNCTION RAILWAY COMPANY V. THE MAGISTRATES OF HELENSBURGH. Macqueen, 39. Railway Company-Contract by Promoters before Incorporation-Whether Binding on Company.

This is a very important case, not only in consequence of the law which it actually decides, but of the law (or, more properly speaking, what has been supposed to be law) which it either condemns or unsettles.

Hitherto it has generally been considered as indisputable that promoters of a company before its incorporation might in equity, though not in law, enter into contracts which would be binding upon the company when incorporated; the Courts of Equity acting upon this principle, that the company when incorporated being entitled to all the rights, are also subject to

all the liabilities of the promoters. These principles were laid down and acted upon by Lord Chancellor Cottenham no less than twenty years ago, in the well-known case of Edwards v. the Grand Junction Railway Company (1 My. & Cr. 650), which was afterwards followed up by Stanley v. The Chester and Birkenhead Railway Company (3 My. & C. 773) and Lord Petre v. The Eastern Counties Railway Company (1 Railway Cas. 462); and moreover in Hawkes v. The Eastern Counties Railway Company (5 H. L. Cas. 374), it is laid down by the high authority of Lord St. Leonards, that these cases were properly" decided.

Now as many contracts must have been entered into by and with the promoters of companies, upon the belief that the law was correctly expounded in the cases before referred to, the decision of the House of Lords in effect declaring that the law as there laid down is incorrect, becomes very important as being likely to lead to much litigation, and to attempts to set aside or treat as nugatory contracts hitherto considered to be binding. In the above-mentioned case of the Caledonian and Dumbartonshire Junction Railway Company v. The Magistrates of Helensburgh, it appeared that the magistrates of Helensburgh entered into an agreement with the provisional committee of the Caledonian, &c. Railway Company to allow the company to lay their lines of rails along the streets of Helensburgh, and to take certain ground of the burgh without payment. They also agreed that they (the magistrates) would apply for an Act of Parliament to extend their harbour, and to charge on the harbour dues 3,000l. to be lent to them by the company. The provisional committee, on their part, bound the company to pay all the past and future expenses of enlarging the harbour, and of applying for the Harbour Act; and that 3,000l. only of such monies should form a charge on the harbour dues. The magistrates of Helensburgh duly obtained their Harbour Act; the committee also obtained their Railway Act; but the agreement was not incorporated in or noticed by such Act. It was held by the House of Lords, that the company was not bound by the contract of the provisional committee, especially as the act to be done was not an act for the effecting of which the company, when established, could lawfully devote its funds. The Lord Chancellor, in his elaborate judgment, said, that a company is a body different from its projectors in substance as well as in form, and that no injustice can arise to those who have dealt with projectors, for against them, and all under whose authority they acted, there would be a clear right of action if the company did not fulfil the engagements which they had contracted that