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In 1866 the remaining portions of the bus. of the Co. were trans. to the Empire; but out of that trans. arose some very important litigation, which we must briefly review.
The art. of asso. of the City and County contained a clause empowering the Directors, with the consent of an extraordinary general meeting, "to trans. and sell the bus. of the Co., or purchase or amalg. with the bus. of any other co. of a like nature." This Co. sold itself to the Empire (by agreement dated Oct. 1866), the business of which was to purchase the bus. of other assu. cos. ; to carry on the bus. of F. and L. assu., and that of a loan co.; to guarantee fidelity; to advance money on houses, etc., and to purchase land. Afterwards the Empire Co., in which the City and County shareholders had taken shares in exchange for those in their orig. Co., came to be wound up, and some shareholders of the City and County were placed upon the list of contributories of the amalgamated cos. They objected, urging that the sale or amalg. was invalid, being ultra vires, the bus. not being of the like nature, and therefore that they were shareholders in the City and County Co. only, which was still in legal existence. And so the Court held, V. C. Wood remarking that "it was difficult to define exactly the meaning of the term 'amalgamation.' But," he said, "it was not sufficiently potent to compel a shareholder in one co. to enter upon all the liabilities of another co. totally different in its objects. a man a partner in a concern of the objects of which he was totally ignorant, and which It could not make he had never consented to join. If amalgamation was to be considered as meaning the power of transferring the whole bus. of one co. to another-in other words, the annihilation of the lesser co.-in which the shareholders in the one co. were to be compelled to participate in the liabilities of that co., however different their objects, it might be contended that a member of an ins. co. might be compelled, against his will, to become a member of a loan, guarantee, or any other speculative co. rectify the regis. of the amalgamated co. by striking out the names of City and County An order was made to shareholders who had continuously declined to sanction the amalg, or accept the new shares. This is now regarded as a leading case on this particular point. [AMALGAMATION.] Mr. Edwin H. Galsworthy is the Liq. of the City and County.
CITY OF GLASGOW ANNUITY AND ENDOWMENT SO., founded in Glasgow in 1840, for the purpose of granting annuities to widows. The asso. carried on bus. until about 1853 or 1854, when its affairs were wound up, by either trans. the annuities to some other co., or returning to the annuitants a surrender value. Mr. S. Pollock was the Sec. of the So. CITY OF GLASGOW LIFE ASSU. Co.-Founded in Glasgow in 1838, with a cap. of £750,000, in 30,000 shares of £25. Cap. in 1842 limited to £600,000, in 24,000 shares of £25 £2 10s. paid The orig. title of the Co. was City of Glasgow L. Assu. and Rev. Co. The "Contract of Copartnery," under which the Co. was first constituted, dated 2nd January, 1839, sets forth as follows:
The persons after named and designated in the testing clause hereof, and hereto subscribing, each
1. That the Co. hereby formed shall be known by the name and designation of the City of Glasgow L. Assu. and Rev. Co.; and notwithstanding the dates of the several subs. hereto, shall be held as having commenced upon the 23rd day of Oct., 1838, which day is hereby declared to be and to have been the time of the commencement of this copartnery; and the said Co. shall continue and endure until dissolved and put an end to in terms of the provision hereinafter expressed, notwithstanding the death, bankruptcy, or retirement of any of the partners; and during the subsistence of the copartnery the said parties faithfully promise and oblige themselves severally to promote and advance the interests of this Co. to the utmost of their power and ability.
The 2nd clause states the object and bus. of the Co. The 3rd relates to the cap., of which the directors might retain unallotted any number of shares they pleased, afterwards allotting them not below par, and any premium received thereon to be carried to credit of proprietors' account. The 4th clause provided that partners within one year after their admission were to "effect and keep on foot one or more assu. or assurances with the Co., either on his or her own life, or on the life or lives of one or more approved nominee or nominees, to an amount of not less than 10 sterling for every 4 shares of the stock subs. by each when 40 or more shares are held, and to the extent of £100 stg. when the partner holds fewer than 40 shares, or shall procure one or more approved substitutes," who should effect such ins., "or that every orig. and future partner of the Co. shall transact such other bus. with the Co. as shall in the opinion of the ordinary directors produce an equal amount of profit to what would have been derived by the said Co. had an assurance been effected as above specified.' amount as should be likely to enforce observance. In default to pay a penalty of such an and be liable for losses in proportion to shares held (c. 8). Partners may sell their shares, Partners should have right of profits after offering them to the Co., directors to have 8 days to accept or decline purchase (c. 9). Partners becoming bankrupt to cease to be partners (c. 11). Assigner and assignee both liable for calls (c. 14). Partners disposing of their shares according to the regulations of the Co. to be relieved of all subsequent obligations (c. 17). Partners holding less than 10 shares to have no vote, then sliding scale-10 shares I vote, 300 shares 10 votes (c. 20).
Directors to have power to appoint a governor, deputy-governor, and extraordinary directors: qualification of ordinary directors 100 shares: annual remuneration of entire board not to exceed £500 (c. 22). Three directors to go out annually (c. 23). Directors to supply interim vacancies (c. 24). Directors to appoint manager and other officers (c.26). Regarding the sale of shares offered under power already named, when the shares offered are 20 or more in number, notice to be given in the Glasgow newspapers for at least 3 weeks of intended sale. "The directors to fix the time and place, when and where the roup or sale shall be made, to regulate the prices at which the shares shall be set up, and to lower the same if they shall think proper; to adjourn the sale from time to time; to receive and discharge the prices; and to assign and convey the shares to the purchaser," etc. (c. 29). The directors may purchase shares for behoof of Co. (c. 30). The following funds were to be opened and kept-"The Proprietors' Account, "The Assurance Account," ""The Annuity Account,' "The Endowment Account," "The Reversionary Account," and "The Accumulation Account." The books to be balanced yearly, and a state of the Co.'s affairs and valuation of the shares to be laid before the ann. gen. meeting. The gen. meeting may appoint a private committee to report upon state of affairs (c. 32). During the first year no dividend was to be paid; but the interest and profit, "after defraying the expenses attending the first year, to be retained to answer contingencies."
It is hereby provided and declared, that it shall be in the power of the ordinary directors to make such regulations as they may think fit for the purpose of allowing persons who shall effect pol. to parti. in the profits arising from the class of bus. in which they may be respectively concerned, and that to such extent, and upon such terms and conditions, as the ordinary directors may from time to time think proper for encouraging the bus. of this Co. (sec. 33).
[It had in the first instance been intended that the Co. should be strictly proprietary; but this idea was abandoned.]
All disputes to be settled by arbitration (c. 35). Provisions as to mode in which Co. may be wound up (c. 37, 38). Then a nice little piece of Scotch law, viz.:
39. That the parties hereto, and their heirs and successors, shall be bound and obliged to fulfil, perform, and observe their respective parts of the present contract, and to abide by and implement the other regulations and bye-laws of the Co. in force for the time, in the whole clauses and articles thereof, with good faith, and according to the true intent and meaning of the same, and that under the penalty of £10 sterling for each share holden by them for the time, to be paid by each of the partners failing to the manager for the Co.'s behoof, over and above performance; and each of the parties hereby assigns to the Co. and to the ordinary directors for the time being, his whole shares of the capital stock, and of the profits thereon accruing, in further security of his punctual performance and observance of the premises, and for enabling the ordinary directors, if at any time necessary, under the provisions before written, to sell and dispose thereof, in manner above directed.
And further in regard that by reason of the length of this deed, and the great number of subscriptions to be adhibited hereto, it is impossible to procure one sheet of paper or vellum large enough to contain the whole of this contract, together with the said subs. hereto, it therefore becomes necessary that various sheets shall be joined together; and in regard it is equally impossible to leave sufficient room for all the parties to subs. the joinings of the said several sheets upon which these presents are engrossed, it is therefore agreed by the whole partners contracting, and hereto subscribing, that . . . two of their number shall be authorized, and they are hereby authorized accordingly, to sign the joinings of said sheets, and of those on which the testing clause and the subs. may yet be written, upon the margin, which it is hereby declared shall be of equal validity and sufficient as if the same had been signed by all and such of the parties hereunto, any law or practice to the contrary notwithstanding (c. 41).
And Lastly--The whole parties subs. consent to the registration hereof, and of the several mandates alluded to in the course hereof, in the Books of Council and Session, or others competent, therein to remain for preservation, and, if necessary, that all execution pass against them and their means and estate, and against the means and estates of the cos. who are parties hereto, and that on a charge of six days in common form; and for that purpose they constitute . . . their procurators. In witness whereof, etc., etc.
It will be seen that some of the preceding provisions are modified by the special Acts about to be noticed.
An early prosp. announced a "special feature,” viz.—“This principle is that if a party has contributed to the profits by payment of a larger prem. than is found eventually to have been required, he shall receive his proper share of the profits thence arising, at the earliest possible period after it has been ascertained that he has made an over-payment." We believe no necessity now exists for such special mode of treatment.
In 1842 the Co. obtained a special Act of Parl.—5 Vict. (session 2) c. lxv.-An Act to enable the City of Glasgow Life Assu. and Rev. Co. to sue and be sued; and for other purposes relating to the said Co. The Act received the Royal Assent 18th June, 1842. It recites the preceding D. of Copartnery, and provides that the Co. may sue and be sued in the name of the Man. In case of any action being brought against any shareholder, notice was also to be given to the Co. (sec. iv). Individual shareholders to be reimbursed by contributions from other shareholders. The property of the Co. was vested in trustees. Cap. restricted to £600,000. The fines on shareholders for not insuring were dispensed with. The three directors going out of office ann. were not to be eligible for re-election for at least one year. The Act was not to have the effect of incorporating Co., nor of exempting it from the provisions of any general Act relating to ins. asso. At this date Mr. W. Dalglish was Man. of the Co.; Mr. Archibald Borthwick, Act.
In 1845 the Co. commenced bus. in Lond. ; in 1847 it took over the bus. of the Mutual Accumulation, which was very small-25 endowments only.
In 1861 the Co. obtained a special Act of Incorp., viz. 24 & 25 Vict. c. cxlv.—An Act to Incorp. the City of Glasgow Assu. Co., and for other Purposes. The Act recites the D. of Copartnery, and the previous Act, which latter it repealed. Sec. 4 declares the Co. and the present and all succeeding shareholders therein :
United and incorp. into one body politic and corporate by the name of the City of Glasgow L. Assu. Co.; and by that name shall have perpetual succession, with a common seal, with power to change or renew the same from time to time; and shall be entitled to purchase, hold, or convey lands, and to carry on their bus. in all its branches, with and under the conditions and provisions and powers and privileges hereinafter specified; and the Co. shall continue so incorp. until dissolved and the affairs thereof wound up, as provided by the contract of copartnery before recited.
But the liability of shareholders was to continue the same as if the Co. was not incorp. (sec. 5); ins. by shareholders dispensed with (sec. 18); ann. gen. meeting to be held last Tuesday in April (sec. 23); shareholders and pol.-holders may sue and be sued (sec. 42); Co. subject to Superior Courts in England and Ireland (sec. 43); a provision in sec. 48 is special and exceptional:
And where any sum of money shall be payable by the Co. under any pol. or obligation, or otherwise, to the heirs, executors, administrators, or assigns of any person deceased, the title of such heirs, executors, or administrators shall be sufficiently estab. by production of any probate of the will of the deceased, or letters of administration of his estate, whether obtained in England, Ireland, in the East Indies, or Her Majesty's Colonies or Dependencies abroad, or by production of any testament testamentary, or testament dative or confirmation ex pede in Scotland, and that, in whatever country such pol. may have been issued, or such sums be paid, or the party so dying may have been domiciled. The Co. is not bound to regard trusts (sec. 49); disputes to be settled by arbitration (sec. 50); contract of copartnery and bye-laws to remain valid (sec. 51); Co. not exempt from prov. of any future Act affecting ins. asso. (sec. 52). In the schedule are a number of forms to be used by the Co.
Mr. Walkinshaw succeeded Mr. Dalglish in the man., and held that position down to 1863. The man. of the Co. is, and always has been, sound and successful. The profits are ascertained and divided every five years. The bonus is allocated upon the sum ins., and all existing bonuses previously declared. An intermediate bonus is declared upon pol. of five years' standing and upwards. Bonus add. on pol. of 20 years' standing may "be applied to make the sum in the pol. payable during the lifetime of the assu., if he attains an age which will be fixed by the amount of rev. benefits surrendered." In the matter of foreign travel and residence, the features are remarkably liberal. [FOREIGN TRAVEL AND RESIDENCE.] All pol. indisputable after five years' duration, and satisfactory proof of age furnished. Fixed minimum surrender values given after three ann. prems. paid; or "free pol." given for equivalent amount.
The ann. revenue of the Co. is upwards of £160,000; the existing ins. in force, 1872, amounted to £4,201,836. The life fund (exclusive of £60,000 paid-up cap.) amounted to £586,930.
The Man. and Act. of the Co. is Mr. Andrew H. Turnbull; the Sec. Mr. George Gray. The Lond. Sec. Mr. F. F. Elderton. The Co. is in every respect first class. CITY OF LONDON ANNUITY AND LOAN CO., founded in 1839, with an authorized cap. of £500,000, which was announced to be "fully subs." The orig. prosp. said:
The objects of this inst. are to grant adequate rates of annu. to parties disposed to invest their surplus cap. in this manner, and to offer to others the means of obtaining a provision at an advanced age, on fair and reasonable terms. In the one case the Co. affords to persons unconnected with, or retiring from trade, one of the best possible modes of securing a competency for the remainder of life; and in the other case it presents to the public a new system of assu., of which the benefit, in each case, is not to be enjoyed by others, after the death of the subscriber, but by the subscriber himself, at that period of life when it is evident that it will be most serviceable, even if it do not become necessary.
It was stated, "The rates of this Co. have been deduced from the most correct modern obs. of the decrements of human life (both male and female), combined with the most exact and extensive experience in the fluctuations of the rate of int." It was further stated, "The funds of this inst. are invested in loans on well-secured life interests and reversions." The following "comparative T. exhibiting the rates allowed by the Co. for each 100 sunk, and comparing them with those allowed by Gov. and when the price of 3 p. c. consols is 90":
Mr. Naylor was the founder of this Co,, but it had not been in operation many months, when, on the formation of the Church of England L. and F. office in 1840, it was pro
posed that its bus. should be absorbed into this new Co., and the arrangement was carried out, as already set forth in our hist. of that Co.
CITY OF LONDON FIRE.-A co. under this title was projected in 1861, soon after the great fire in Tooley St., and when considerable excitement prevailed in the City regarding the prems. for mercantile risks, which had been suddenly and largely increased in consequence of that calamity. Mr. Stephen Sleigh was the promoter of the Co., apparently under the patronage of Mr. Wm. Henry Peek, the well-known tea and coffee merchant. This project afterwards merged into the Commercial Union, which was set on foot a few days later. CITY OF LONDON AND GENERAL FIRE AND LIFE INS. Co., LIM., projected in 1863, with a cap. of £1,000,000, in 20,000 shares of £50. Mr. A. H. Gunn was the promoter of the Co., which was dissolved almost before it was created, under the following circumstances. The shares of the Co., when the project was first put on the market, were "beared" considerably. The promoters, by way of retaliation, took steps to improve the market. A reaction set in, and the shares came to be quoted at a considerable prem. The applications immediately became very numerous, reaching in the aggregate 23, 182, against which, however, the directors only allotted 13,652. By this means many of those who had sold the shares on a speculative account got none allotted, and had to go into the market to purchase shares for delivery. This caused the price still further to advance, until at length the prem. reached £5 on shares having I paid by way of deposit, or in other words, the shares reached 500 p. c. prem. A Mr. Jamieson, of Aberdeen, had been called in to work the market into this form, and he became somewhat rapacious in his demands upon the promoters. They did not comply, and he took some action by applying for a summons against the promoters, which however he did not obtain. But enough transpired to give the "bears a hope of escaping from the dilemma in which they found themselves. They initiated criminal proceedings against the directors and promoters. The directors backed out, and left the fighting with the promoters. Mr. Gunn made a vigorous resistance. He pub. a "Statement," in which there occurs this passage: Speculation had taken place to a large extent in our shares. Our stock was rising, and on some of the operators who had contracted to sell and deliver the fulfilment of their engagement on the settling day would have inflicted severe, perhaps ruinous, loss. It became a matter of life or death, of bankruptcy or solvency, with some of them, whether the settlement could or could not be deferred. It was their interest to put it off-to put it off if they could for ever. There were others rowing in the same boat whom it might not ruin, but unpleasantly mulct-men of influence and accredited for wealthmen of financial and official position in the City.
There is no doubt this is a true picture. The large attendance of City magistrates at the hearing, and the commotion among them, led careful observers to remark that they did not seem to be all there for the purposes of justice. In the end it was announced that the Co. would be dissolved, and that consequently there would be no allotment of shares. This appeared exactly to suit the views of the more clamorous, and so the embryo co. disappeared from the scene.
CITY OF LONDON LIFE Assu. So., founded in 1845, with an authorized cap. of £250,000, in 5000 shares of £50, "for general assu. on lives and survivorships, the purchase and grant of annu., the purchase of life interests and reversions, endow. for widows and children, loans and accumulative and self-protecting assu.' The greater portion of the cap. was subs. The orig. prosp. said:
The City of Lond. L. Assu. So. has been estab. for the purpose of uniting all the advantages presented by other L. assu. offices, with certain plans of a peculiar nature, of mut. interest to the assurer and the assured; and, with a view of affording facilities in every department of bus., upon principles of true economy, limited only by a strict regard to security.. Among the peculiarities of the system adopted by this office are: 1st. A computation of prems. founded not upon local, imperfect, or theoretical data, but upon the actual experience of a considerable majority of the most important offices in existence; and a graduation of charges for management, etc., equitably adjusted to every age.... 4th. A new and valuable extension of the principle of L. assu., by which deposits are made either suitable for an assu., or may be reclaimed at any period.
Among the privileges enjoyed by the assured are: 1. A full proportion of the profits of the office, by the mutually assured; and a parti. with the proprietors generally in their control over the manage. ment. 2. A commutation of the prospective benefits of the mut. branch, effected by a proportionate reduction of the rates in the proprietary scale of prems.
General Features.-After a proportionate contribution towards the int. upon the subs. cap. and the general charges of the estab., the whole of the profits arising from the mut. assu. will be triennially divided, after the first 3 years, among the assu. in that department. All other profits to be added in completion of subs. cap. Foreign lives assu. and annu. granted to foreigners under special con
There was to be a fund, "under suitable regulations, raised in accordance with a distinct set of T., for the benefit of the widows and children of naval and military officers, and of clerks in government and municipal offices." A later prosp. announced " self-protecting assurance and "indisputable pol."
In the first instance, Mr. Rainbow was Consulting Act. ; afterwards Mr. G. J. Farrance. Mr. Edward Frederick Leeks was Sec. of the Co. The bus. of the Co. was very limited in its early years. It reported one death from cholera in 1849, ins. for £1000. At the end of 1851 the total insurances on the books amounted to £265,827, yielding in prems. £9235. In 1852 a bonus was declared equivalent to 20 p.c. cash on the prems. paid on pol. of 5 years' standing. The total pol. issued up to that date were 1041, ins. £383,578.
In 1851 the Co. took over the bus. of the Peoples L.; in 1853 the bus. of the County Mutual; in 1856 the bus. of the Deposit and General, and also the bus. of the Protestant L. In 1857 the bus. of the Absolute, and also that of the Observer. In 1858 it took over the bus. of the Achilles. In 1859 its entire bus. was trans. to the Eagle. It was most fortunate for the pol.-holders of these united offices to find themselves ultimately enjoying the advantages of such a solid and advantageous asso. This was one of the first of the modern offices which commenced to acquire the bus. of other cos. by amalg. or purchase. CITY OF LONDON LOAN, ANNUITY, AND ĜENERAL INS. Co.-A Co. under this title was projected in 1845—the same year that the City of Lond. Life was founded. We presume that it was the rival counterpart, which nearly always appears, and is generally the result either of a split between promoters or of a traitor in the camp. Sometimes promoters themselves regis. a similar name under which they intend to trade, with a view of securing a complete monopoly in the title of their enterprise.
CITY OF MANCHESTER INVESTMENT Co. was projected in Manchester in 1855, for granting loans in connexion with life ins. It never reached the stage of having any money to lend; and-being unable to borrow any-fell through!
CITY AND PROVINCIAL INS. Co.-A project under this title was regis. in 1861. We believe it had been previously regis. as the Britannia F. The promoter was Mr. Alfred T. Jay. It did not go forward.
CIVIL stands for the opposite of anything military, political, ecclesiastical, or criminal. CIVIL COMMOTION.-An insurrection or tumultuous rising of the people for the purposes of specific or general mischief, but falling short of rebellion to overthrow the government. It is a usual condition in F. pols.—and a prudent and necessary one-that the office shall not be liable for loss occasioned by Civil Commotion, riots, etc. Owners of property, however, are not left without a remedy in such cases; this remedy is against the Hundred in which the outbreak shall arise. The liability of the Hundred for damage done to property is very ancient, and may be traced back to the time when every community was responsible for the acts of its members. It was bound to maintain its own peace; and if it failed to do so, it was punished for its default by being compelled to compensate the damage done by those whom it could not, or would not, put down.
The early riot acts embodied legislation upon this subject—especially that of 1714-the I Geo. I. stat. 2, c. 5. There has, however, been some modern legislation upon the subject, and there are also several important cases in the law-books.
In 1726 the Sun F. office introduced into its conditions of fire ins. the following words: "No loss or damage to be paid on fire happening by any invasion, foreign enemy, Civil Commotion, or any military or usurped power whatever." Several other offices had a similar clause, with the exception of the words "Civil Commotion."
In 1780 Gordon's [Lord George Gordon] "No Popery" riots occurred in Lond., and a considerable destruction of property took place. In reference to the property so destroyed several actions came before the Courts, which we shall have to notice.
In the case of Langdale v. Mason and others [Managers of the Sun F. office], that Co. was in the same year (1780) sued under one of its pol. for payment of the sum ins. on a house and premises burned by the rioters. The Co. pleaded its condition above given; and after an able summing up by Lord Mansfield, the jury found for the defendants on the ground of the exemption in their pol.
In the case of Mason v. Sainsbury, which came before the King's Bench in 1782, the facts were as follows. It was an action under the Riot Act (1 Geo. I. c. 5, s. 6), to recover damages sustained by the demolition of a house in the riots of 1780. There was a verdict for the plaintiff, with £259 damages, subject to the opinion of the Court on a case, which stated that the plaintiff had ins. the house in the Hand-in-Hand Fire Office, which had paid the loss; and that this action was brought against the Hundred in the plaintiff's name, and with his consent, for the benefit and indemnity of the ins. office. When the case was first heard, it was contended, for the plaintiff, that there were a variety of cases like the present in which an action might be maintained in the name of the person originally interested. On its rehearing upon the points reserved, the question mainly turned upon the one point, viz. whether, as the plaintiff had already received a satisfaction, this action could be maintained against the Hundred on behalf of the insurers. The Court was unanimously of opinion that such a right existed.
In the case of Lond. Assu. Corp. v. Sainsbury, heard in 1783, the facts were as follow: The ins. office, having paid the insured the amount of the loss sustained by him in consequence of a demolishing by rioters, sued the hundreders in their own names. Held, by Lord Mansfield and Mr. Justice Buller (Justices Willes and Ashurst dissenting), that the ins. office was not entitled to recover. This objection appears to be only one of form. The insured had gone against the county for his entire losses, which were much beyond the sum insured; he had recovered (Langdale v. Kennett, 1781), except that the jury deducted from the total loss the sum received from the ins., and thus left the ins. co. without remedy, as a second action could not be maintained.
We presume after these decisions all the F. offices introduced the words "Civil Commotions" into their exemptions from liability. We shall revert to this subject under FIRE INS., CONDITIONS OF.