The Caledonian Railway Company had in 1849 leased the Barrhead Railway for 999 years at a rent of pounds 16,500. In 1851, under the Caledonian Railway Arrangements Act, it was agreed that this rent should be reduced to pounds 11,250 per annum, and that the Caledonian Company should issue to the shareholders of the Barrhead Company pounds 82,500 of the ordinary stock of their Company, which was then selling in the market at from 27 to 30 per cent., as the price of the redemption of the pounds 5250 of yearly rent. In 1869 an Act was passed admitting the Glasgow and South-Western Company to share equally with the Caledonian Company in the benefits of the Barrhead lease, upon the condition that the South-Western Company should pay one-half the year’s rent, and should repay to the Caledonian Company ‘a sum equal to one equal moiety of all sums expended by the Caledonian Company on capital account in connection with the Barrhead Railway.’
Held that the pounds 82,500 stock issued by the Caledonian to the Barrhead Company in redemption of rent was to be considered a payment on capital account, in terms of this section, and that the Glasgow and South-Western were bound to relieve the Caledonian of one-half, taken at its nominal value.
Judges:
Lord Chancellor Cairns, Lords Chelmsford, Hatherley, and Selborne
Citations:
[1874] UKHL 484, 11 SLR 484
Links:
Jurisdiction:
Scotland
Transport
Updated: 22 November 2022; Ref: scu.650211