Costs-Service of Petition-Want of Interest in Respondent.

A defendant who has been served with a petition, although he has no interest in the subject-matter of it, is entitled to the costs of his appearance.

A party absolutely entitled in reversion to a sum of stock in court, the dividends of which were payable to trustees in trust for a person named Susannah Jacques, a married woman, for her life, for her sole and separate use, assigned the same to A. and B, as security for advances made by them to him. Under a decree made in a suit instituted by the mortgagees, the Master found the amount of the incumbrances, which exceeded the value of the security after providing by sale of a competent part of the principal sum of stock for a Government annuity for the life of Susannah Jacques (who was fifty-six years of age), equal in amount to the dividends arising annually from the principal sum of stock: the husband of Susannah Jacques was a defendant to the suit as well as her trustees. All the parties to the suit, except the defendant, the husband of Susannah Jacques, joined in presenting a petition, praying that a competent part of the stock in court in the cause might be sold, and the proceeds thereof laid out in the purchase of a Government annuity, equal in amount to the dividends then annually accruing in respect of the stock, the same to be paid to the trustees of Susannah Jacques from time to time, and that the residue of the stock in question might be ordered to be transferred to the petitioners the incumbrancers. When the petition first came on to be heard, the defendant, the husband of Susannah Jacques, had not been served with the petition, and the Master of the Rolls expressed a disin

clination to make the order sought, but gave leave to the petitioners to amend the petition if they should be so advised, and ordered the same to stand over in the mean time. The petition having been amended by making Susannah Jacques and her husband and the trustees of Susannah Jacques respondents to the petition, all of whom had been served with the petition,

Mr. F. J. Hall, in support of the petition, submitted that the defendant, the husband of Susannah Jacques, ought not to be allowed his costs of appearing on the petition, inasmuch as nothing was sought by the petition against him, and there was no occasion for his appearing thereon. Major v. Major (1) was cited for the petitioners.

Mr. Glasse, for the husband of Susannah Jacques, contended that according to the established practice of the Court he was entitled to his costs against the petitioners, having been served by them. with the petition.

Mr. Turner appeared for Susannah Jacques and her trustees.

The MASTER OF THE ROLLS stated that he had always understood the rule of the Court to be that a party appearing on a petition only because he had been served with it, was entitled to his costs; but having regard to the authority cited, it would be proper to speak to the Lord Chancellor on the subject, and if any alteration were to be made in the practice as to the costs in cases like the present, it must be effected by a General Order of the Court.

Feb. 20.-The MASTER OF THE ROLLS stated that he had consulted the Lord Chancellor on this point, who said he had made no such decision as that referred to in support of the petition, and therefore the old practice would be continued, and the respondent in the present case would have his costs.

(1) 13 Jur. 1, explained at p. 202.

Subpaena-Substituted Service-Defendant out of Jurisdiction.

A suit was instituted against three trustees, who all appeared by the same solicitor. After decree, the sole plaintiff died, and a bill of revivor was filed. One of the defendants could not be found, being supposed to have gone to America; but there was no evidence of his having absconded to avoid service, and the place of his residence could not be ascertained. The Court ordered substituted service of the subpoena to appear in the revived suit upon his solicitor in the original suit.

This was a suit instituted against the trustees of a composition deed for specific performance. After a decree made, the sole plaintiff died, and a bill of revivor was filed by his personal representative, and thereupon application was made to the solicitor, who had acted for all the defendants in the original suit, to ascertain whether he would appear for them in the revived suit. This he declined to do; but afterwards entered an appearance for one of them, and the plaintiff entered an appearance for another under the 29th Order of May 1845. The remaining defendant, Firth, could not now be found. It appeared, however, by the affidavits of the solicitor of the plaintiff in the revived suit, that he had most probably gone to America, and that the place of his residence could not be ascertained. There was no evidence of his having absconded to avoid service. Under these circumstances an ex parte application was made by the plaintiff before Wigram, V.C., for an order that service of the subpoena to appear to the bill of revivor upon the solicitor who had acted for all the defendants in the original suit, might be good service on Firth, the defendant who was out of the jurisdiction. Wigram, V.C. refused to make the order, but directed the application to be made before the Lord Chancellor.

On the motion being renewed before the Lord Chancellor,

The Solicitor General, for the motion, urged that as the defendant Firth had not absconded to avoid service, the 31st Order of May 1845 would not apply; and as the place of his residence was unknown, he could not be served under the 33rd Order; that the present was a casus omissus in the Orders of May 1845, though within the scope and spirit of those Orders; that substituted service was allowed on the solicitors, attornies, and agents of defendants out of the jurisdiction-Weymouth v. Lambert (1), Hobhouse v. Courtney (2), Hornby v. Holmes (3), Cooper v. Wood (4); and the 4 & 5 Will. 4. c. 82. s. 1. allowed substituted service on the steward or receiver of an absent defendant. The earlier cases, which appeared unfavourable to the present application, were Geledneki v. Charnock (5), Henderson v. Meggs (6), Brown v. Lee (7), Lee v. Warner (8); but the present practice had been much relaxed in this respect since the decision of those

cases.

March 14.-The LORD CHANCELLOR.In considering the question in this case, I think it is within the principle laid down by Lord Lyndhurst, in Murray v. Vipart (9); and indeed it contains circumstances much stronger in favour of the application than existed in Murray v. Vipart. In that case there was merely a letter from the solicitor, stating that the absent defendant had instructed him to do all that was

necessary in the matter. In the present case the solicitor has actually represented the defendant and acted for him throughout the original suit as his solicitor; the bill of revivor relates to the same matter, and is a proceeding necessary to give effect to the decree made in the original suit. I shall make the order, therefore, for substi

(1) 3 Beav. 333.

(2) 12 Sim. 140; s. c. 10 Law J. Rep. (N.s.) Chanc. 377.

(3) 4 Hare, 306. (4) 5 Beav. 391. (5) 6 Ves. 171. (6) 2 Bro. C.C. 127. (7) 2 Dickens, 545.

(8) Ibid. 546.

(9) 1 Philli. 521.

A. and B, traders, had a joint account at their bankers, and A. had also a separate account at the same bank. The bankers suspended payment; at that time the joint account of A. and B. was indebted to the bankers, but the bankers were indebted to A. upon his separate account. A. and B, in pursuance of an arrangement between themselves, gave a notice to the bankers, desiring them to transfer the money standing to the separate account of A. to the joint account of A. and B. The bankers omitted to comply with this order, and afterwards became bankrupts, and their assignees brought an action against A. and B. for the balance due to the bankers upon their joint account. A. and B. filed this bill to restrain the proceedings at law :-Held, that the bankers, after a suspension of payment, could not transfer or set off one account against another; that they had no lien upon the separate balance in their hands for the money due to them upon the joint account; and that A. and B. had no right to be relieved from the proceedings at law: and the bill was dismissed, with costs.

Thomas and William Watts, the plaintiffs in this suit, carried on business in partnership, and kept a banking account in their joint names with Messrs. Clarke, Mitchell, Philips, & Smith, bankers, at Leicester. Thomas Watts also kept a separate account with the same bankers, in his own name.

On the 22nd of April 1843, the bankers, by a printed circular, announced to their customers that a temporary suspension of the business of their bank had become necessary; after that no cash payments were made, but the bank was kept open for customers, and the bankers received their own notes of issue in payment of amounts due to them from several of their customers, and they received and acted upon the direction of many of their customers respecting balances due from them to the bankers and from the bankers to many of their customers, and in many instances debts which were due to the bankers, were satisfied by entries made in the bank books, transferring various amounts which stood in their books as due from them to different customers to the credit of other customers, who were indebted to the bankers; such transfers being made by the order and direction of the several customers to whose credit such amounts stood in the books of the bank.

On the 3rd of May 1843, a meeting of the friends and connexions of the bankers was convened, and held at Leicester, to consider the course most advisable to be adopted for the public convenience, and among other resolutions it was resolved"That it appears to this meeting that the assets of the bank, and the private property of the partners (all of which is available), afford ample means for discharging all the liabilities of the bank, and leave a surplus of 120,000l. and upwards, after making every allowance for the possible depreciation of such assets or property."

On the day of the temporary suspension of the business of the bank, the plaintiffs, Messrs. Thomas and William Watts, were indebted to the bankers, on their joint partnership account, in the sum of 3357. 16s. 3d., and the bankers were indebted to the plaintiff, Thomas Watts, on his private or separate account, in the sum of 4787. 148.

On the 25th of May 1843 it was arranged between the plaintiffs that the 4787. 14s. should be transferred so as to vest the same in them jointly upon their partnership account; and on the same day they served the following notice upon the bankers:

"Gentlemen,-I, the undersigned Tho

mas Watts, do hereby give you notice that I have, by an indenture dated this day, assigned and transferred the balance or sum of 4781. 14s. standing in my name, and all other monies belonging to me, in your possession as my bankers, to Thomas Watts and William Watts; and the undersigned Thomas Watts and William Watts hereby require you to place the said sum of 4781. 14s. to the account of the said Thomas Watts and William Watts. As witness our hands this 25th of May 1843.

(Signed) "Thomas Watts.

"William Watts."

On the 31st of May 1843 a fiat in bankruptcy was issued against the bankers, grounded on an act of bankruptcy committed by them on the preceding day, under which they were declared bankrupts, and Messrs. Christie, Dicey, Allen, Crossley, Hawley, and Ward, the defendants, were appointed their assignees.

No transfer of the sum of 4787. 14s. was made by the bankers in pursuance of the notice given by the plaintiffs. On the 13th of February 1846 the defendants, the assignees, brought an action in the Exchequer against Thomas Watts and William Watts, to recover the sum of 3351. 16s. 3d. due from them, as co-partners upon their joint banking account. On the 2nd of March 1846 Messrs. Thomas and William Watts filed their bill in this court, alleging that if the transfer of the 4787. 14s. had been made from the separate account of Thomas Watts to the joint account of the partnership, nothing would have been due from the plaintiffs; and that Thomas Watts, though he could not obtain payment, had still full power to order and direct the bankers to transfer the sum of 4781. 148. to the credit of any person he might select; and charging that it was the duty of the bankers, up to the time of their bankruptcy, to obey the directions given by the plaintiffs; and that the bankers after their suspension of cash payments, and up to the time of their bankruptcy had, with the knowledge and privity of their customers, received the notes which had been issued by the bankers in payment of sums due from their customers, and also transferred various sums of money from the respective accounts of several of their customers, to

the accounts of others of them respectively, and that the bankers had in other respects dealt with the accounts of their customers as they from time to time had directed; and they prayed that the assignees might be restrained from proceeding at law to recover the balance of 335l. 16s. 3d. claimed to be due on the joint partnership account. The defendants put in their answer, and upon the cause coming on a reference was directed to the Master, in pursuance of which he, by his report, dated the 19th of January 1849, found that the bankers, after they had stopped payment, continued between the 22nd of April 1843 and the 31st of May 1843 to receive their own notes of issue over the counter to the extent of 72,326l., in discharge of debts due to them to that amount, and that they allowed divers transfers of money from one customer's account to another customer's account, and also that between the 22nd of April and the 31st of May 1843, they received and credited cash or deposit receipts in the hands of customers.

The

Mr. Turner and Mr. Glasse, for the plaintiffs.-The direction to the bankers to transfer the sum due on the separate account was a binding, equitable assignment. bankers had the funds in their hands, and the order to pay was a credit given upon that fund in favour of the joint account, and such orders have been considered good against a subsequent bankruptcy-Row v. Dawson (1), Ex parte South (2), Burn v. Carvalho (3).

The power of the creditor to transfer did not cease either at law or in equity during the temporary suspension of business the bankers and their friends contemplated a resumption of payments, and not bankruptcy, and if payment had been resumed the bankers would have been bound by the order which Thomas Watts gave. From the date of the order a right of set-off existed, and in bankruptcy a setoff of a separate debt from an estate against a joint debt due to it had been permitted. -Ex parte Hanson (4). The assignees

were subject to the same equities as the bankers; they had, therefore, no right to commence proceedings at law for the balance due on the joint account, and they ought to be restrained by the order of this Court.

Mr. Roupell and Mr. S. Smith for the assignees.-There was no consideration given for the assignment; it was a direction to deal with the separate accounts after it was known that there was a suspension of cash payments; at that time the debts of the bankers were suspended, and the money due upon the separate account of Thomas Watts was not a balance which could be disposed of, and payment could not have been enforced. If the practice contended for was allowed to prevail, it would give rise to a traffic in debts with persons holding accounts with bankers. was no set-off of demands due in different rights; neither was there any set-off between joint and separate debts.

There

Ex parte Christie, 10 Ves. 105. Addis v. Knight, 2 Mer. 122. Jones v. Mossop, 3 Hare, 568, 574; s. c. 13 Law J. Rep. (N.s.) Chanc. 470.

verbal order, though a form was usually adopted, and this practice had prevailed for years. In the present case, the balance due from the bankers to Thomas Watts on his separate account might have been transferred in the usual course of dealing, had not the bankers, on the 22nd of April 1843, suspended their cash payments. This fact was announced to all the customers; the bankers therefore could not pay any cheque, but at the same time they represented the state of their affairs to be such that hey should be again able to resume cash payments, if their customers could be induced to forbearance; but this prospect might have been dispelled had Thomas Watts brought an action for his balance but instead, he, on the 25th of May 1843, executed an instrument, (the validity of which he would not discuss, as a common cheque would have been sufficient) and, if there had been no stoppage of payment, it would have been obeyed, or the bankers would have subjected themselves to an action. But at that time the money could not have been obtained by a cheque. Still the plaintiffs desired to have all the advantages of a cheque in a way which was not considered prejudicial to any one, and this was by transferring the balance due to Thomas Watts on his separate account to the partnership account of Thomas and William Watts: it was no otherwise that it could have been recovered. The plaintiffs were encouraged to this as the, same had been done by the bankers for other persons; it was however a preference which the law would not encourage or assist. Had the plaintiffs got such a set-off, they would have been in a better situation than the other creditors of the bank. It had been argued that the bankers had a species of lien upon balances in their hands, and that it was the essence of their dealings; but customers had a right to have their balances at command, and bankers could never have such a claim of lien as that contended for. It was impossible for the plaintiffs to succeed, and the bill must consequently be dismissed with costs.