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THE CIVIL ENGINEER AND ARCHITECTS JOURNAL. 



[July, 



of proxy must be obviously "undue influence." Individual influence, 

 and thereby patronage and favouritism is also increased by companies 

 having the power of purchasing shares to merge in the company, 

 which are held not in the company's name, but by directors in trust 

 for the company. This is of immense importance in the appointment, 

 or otherwise, of committees of inquiry into management of companies ; 

 one recently appointed was carried by a majority of 715 when nearly 

 8,000 votes were polled. The committee of inquiry reported ; the 

 directors replied; the committee answered, and the directors pub- 

 lished a rejoinder, and another poll took place, the direction beating 

 the committee by a majority considerably less than before ; to gain 

 which every move was tried, and thirty votes held in trust in names 

 of directors were openly used and it was at the same time strongly 

 contended that the right to vote was in the share, not the individual; 

 he might be bankrupt, a convict, a felon, or even dead, aud being 

 known to be dead, he would be revivifled for the day. 



Sales or purchases of shares are generally made through a share 

 broker, who uses the prefix "share" to distinguish him from other 

 brokers ; those of the Stock Exchange generally act as London agents 

 for the provincial brokers, and sometimes the fees on commission are 

 divided between them. For shares under five pounds the commission 

 varies from a shilling, as the circumstances may differ. The following 

 is the usual scale of brokers' commission: — 

 £. s. d. 



5 - 10 per share. 



5 under 20 2 G 

 20 „ 50 5 



50 10 per cent. Debentures 5s. per cent. 



The stamp duty payable on transfer of shares is the same as the 

 ad valorem duties on assignment of lands. 



In addition to the stamp duty, which is paid always by the pur- 

 chaser, some of the companies make a charge of Is. to 2s. Gd. for each 

 transfer in the company's hooks, which is charged to the credit of the 

 company, or allowed as a fee to the secretary as an augmentation of 

 his salary. The charge for registration of a transfer which is adopted 

 by some companies, as the Greenwich, Taff Vale, and Newcastle and 

 Darlington Junction and South Eastern Railways, varying from one 

 shilling to half-a-erown, tends also to further the continuance of the 

 practice of using blank transfers and the consequent evasion of the 

 duty, and I apprehend those who adopt the charge do not improve 

 their undertaking in the estimation of the public. 



I have omitted to notice that in many of the companies the fifth 

 part of the shares in the first allotment are reserved for the landowners 

 on the line ; and that in the. creation of new shares, old shareholders 

 have priority, the shares being allotted in proportion to their holdings, 

 and that some companies have been in the practice of paying interest, 

 during the execution of the work, on capital or paid up shares, so 

 soon as one-fourth of the share has been called. Among those who 

 have so acted, that I can call to mind, are the Greenwich, Grand Junc- 

 lion, and Newcastle and Carlisle Companies. 



As I said on the commencement of this paper that this subject was 

 not my forte, or in my 1 i n ? , I cannot therefore enter on the zoology of 

 the two animals "Bull and Bear," or the inexpediency of what are 

 called time bargains to individuals on the Stock Exchange, and their 

 detrimental effects to the undertaking in which the transactions are 

 made, the directors having no control over the parties operating, who 

 unnaturally depress the value of the shares, no matter what may be 

 the depressed state of the market, these fine gentry are generally 

 obliged to get out by hook or by crook, and at any sacrifice to them- 

 selves and the undertaking. The companies have also to a certain 

 extent adopted the principle of time bargains both with respect to the 

 issue of loan notes and debentures ; of the latter mode of proceeding 

 the Eastern Counties is an example, who give the holder of each de- 

 benture of 8/. 7s. iid. the option in three years of taking a 25/. share of 

 the former; the Croydon company give the option for the same period 

 to the holder of loans, to convert 15/. loan notes into a share of 20/„ 

 and the Brighton for a similar period of three years to the holders of 

 their loan notes of conversion into quarter shares at lu/. each. 



A system of leasing the works of one company to another has been, 

 to a certain extent adopted, which was done, I think, first, by the York 

 North Midland taking the Leeds and Selby line for a term of years. 

 The following have also followed the example: The Birmingham and 

 Gloucester have a lease of a portion of the Cheltenham and Great 

 Western Union from Cheltenham to Gloucester, and the Great Western 

 have a lease of the Bristol and Exeter, and a portion of the Cheltenham 

 and Great Western Union; the rent of the former being 30,000/. 

 and the latter 17,000/. per annum. The South Western or South- 

 ampton Railway took up the Gosport Branch Railway, and paid the 

 shareholders 5 per cent., with option after a certain time of joining in 

 a general dividend with the main line, and a similar course has been 



pursued with the Warwick and Leamington Company, and the Bir- 

 mingham Company. The system of letting or leasing railways !o 

 private individuals has been attempted on the Northern and Eastern 

 and the Brandling Junction Railway; the commiltee of inquiry, on 

 investigation, recommended that system in respect to their lines, but 

 no case as yet has it been carried into practice. 



To conclude this rambling paper I refer to the greatest difficulty 

 that railway companies have to contend with, viz, the closing of 

 capital account in consequence of disputed accounts with contractors, 

 and the excess of capital required over previous estimates, rendering 

 it almost impossible for the uninitiated to form any opinion as to the 

 merits of an undertaking so situated, with reference to their solvency 

 or otherwise, and the consequent uncertainty of railway stock as an 

 investment for the widow or trustee, and all experience shows that 

 until a railway is finished, and its traffic fully developed, the greatest 

 uncertainty attaches to such works. I have endeavoured, however, 

 imperfectly to point out the manner adopted by railway companies of 

 raising capital by shares and loan, also the mode of transferring shares, 

 the amount of share and the consequent liabilities, and the influence 

 of holding, as to individuals and directorates in the management of 

 railways and the power of control as to the shareholders at large. At 

 the same time I have pointed out that little or no information is to be 

 had in any work expressly devoted to railways, on this subject, they 

 being more generally devoted to the description of the construction of 

 the more important bridges, &c. on each railway, its course and direc- 

 tion, and the towns in the vicinity. I am nevertheless in hope that 

 this paper will call attention to the subject by one more competent to 

 the task. 



One desideratum yet required to give stability to railway property 

 is, the closing of capital account, and the publication of shareholders 

 and the number of their holdings, and the full developement of pas- 

 senger traffic as regards the third class carriages, which ought not to 

 be so constructed, that 70 persons are made to stand up without cover 

 or shelter ; the principle on which the companies ought to act is, to 

 carry people cheaper than they can walk, as notwithstanding the saving 

 of time, another element in the calculation is money, which is said 

 to be also time ; but in the present depressed state, many have time 

 to spare for travelling, but not money also, at least in quantity suffi- 

 cient for pleasure, even at second class fares. As to goods traffic, 1 

 think that as regards general merchandize, that the old system will be 

 able to compete with railways ; and as regards coal or other produce, 

 always conveyed in one direction, the local or large holder generally 

 makes a bargain consonant with his own notions. Passengers are the 

 main support of railways ; and the safety to passengers is no specu- 

 lative point, eighteen millions of persons having travelled by railway 

 in 1S42, and only one was killed whilst riding in a train ; and there is 

 no doubt that the traffic and returns have also exceeded the most san- 

 guine expectations of the original projectors, as well as the amount of 

 capital required. Railways must ultimately pay, and settle down into 

 one of the most eligible of investments, as the facility with which a 

 transfer can be made in comparison with a freehold, is greatly in their 

 favour. 



I have annexed to this paper the different forms of transfer, cer- 

 tificate for a share, and a scrip certificate also of a proxy, and the 

 memorandum given by the secretaries that a share or shares on a 

 given date were transferred from a certain name to another. 



St. Ann's, Netvcaatle-upon- Tyne. O. T. 



So. 1. — London and Paris Railway. 



John Doc, of the town and county of Newcastle-upon-Tyne, agent, in 

 consideration of £100., paid by the said RicbarJ Roe, do hereby bargain, sill, 

 ass'gn. and transfer to the said Richard Roe, ten shares, numbered 3270, 

 M.'i.'.l, Sic, of anil in the undertaking called The London and Paris Railway. 

 To bold to the said Richard Roe, his executors, administrators, and assign's, 

 subject to the same rules, orders, and restrictions, and on the same condi- 

 tions that the same were held immediately before the execution hereof. And 

 the said Richard Roe does hereby agree to take and accept of the said shares, 

 subject to the same rules, orders, and restrictions, and conditions. Witness 

 our hands and seals this twelfth day of June, in the year of our Lord uw 

 thousand eight hundred and forty three. 



Signed, sealed and delivered (being first duly"| 

 stamped) by the said John Doe, in the presence}- John Doe. 



of — J 



Signed, sealed and delivered (being first duly"* 

 stamped) by the said Richard Roe, in the pre- > Richar ! Roe. 



sence ot — — — J 



