The Earl of Besborough
said, that he thought that no noble Lord who had read the Report, could doubt that fraud had been perpetrated in making out the lists of subscribers to the Railway. It was not intended in the Report to bring a charge of this kind against the directors; but that it had occurred through their negligence. The House was aware that, in undertakings of this kind, it was customary to put in the list of the provisional committee the names of persons of influence, and more especially those connected with other railways; but if persons suffered their names to be thus used, they should take care to see that the proceedings were properly carried on. The noble Earl then proceeded to read extracts from the evidence taken before the Committee appointed to inquire into the allegations of Mr. Pym's petition with respect to the allotments of shares, with the view of showing that the statements in that petition had been proved. He thought that the statement of his noble Friend (the Marquess of Clanricarde), that the first part of the Report had not been proved by the evidence, could not be sustained. He, therefore, was satisfied, in consequence of the utter want of adherence to the Standing Orders of that House by the promoters of this Bill, that they could, not allow it to proceed. It could not also be said, that the second Report did not sustain the allegations in the first. Under these circumstances, he felt it to be his duty to move that the Bill be taken into further consideration this day three months.
The Marquess of Clanricarde
could not understand the reason that induced his noble Friend to fix on this particular Railway 1172 Bill with such energy, with a view of preventing the further progress of it. He did not see why this Bill should be stamped with a character of fraud, when many other Railway Bills, against which the same charge could be sustained, as to the names of unqualified persons being affixed to the contract deed, had been allowed to pass without any observation. His complaint against the Report of the Committee was, that it brought the charge of systematic fraud having been used for the purpose of obtaining the requisite number of signatures. Now, had his noble Friend said one word, or quoted a single portion of evidence, to show that any man had been induced against his will to sign the contract deed to which his name was affixed, or that greater frauds had been perpetrated by persons getting shares without reference and inquiry, than was the case with other railways? When a specific charge of fraud was brought against any one, the Committee should show that there was good evidence to sustain such an accusation; but there was no evidence to justify such a charge. He denied the whole of the allegations contained in the Report of the Committee. The whole of the proceedings with respect to the appointment of the first Committee, were irregular. That Committee was named to inquire into the allegations contained in the petition of a Mr. Pym, a stockbroker in Dublin, who was largely interested in the success of atmospheric railways; and who was also a large canal proprietor, and, like other canal proprietors, was opposed to this Bill, under the notion that it might be injurious to his interests. So it might be immediately, but would not ultimately; and some of those people had seen their mistake, and withdrawn their opposition to railways; but then Mr. Pym was a shareholder in another railway, and he (the Marquess of Clanricarde) was glad that the House had inquired into the allegations of Mr. Pym; but he contended that their Lordships ought not to pounce upon an unfortunate Bill, which had been actually victimized by fraudulent persons, and a company which could not protect itself against those fraudulent parties. Their Lordships ought to attack the system, not individuals. He trusted that next year there would be some material alteration in the system of railway government—the present system was most unsatisfactory. He knew that the House 1173 was most unwilling to act against the Report of a Select Committee; but the proceedings of the Committee on this Bill were altogether different from those on any other that he recollected. The House should remember that Mr. Pym went before the Standing Orders' Committee; but his evidence was not received, because it appeared that he had no locus standi, as he was not a proprietor in the line, or had any other interest in connexion or in competition with it. This person, then presented a petition to that House, which was most irregularly referred to a Select Committee, which certainly was against the Standing Orders. He conceived that it would be a most unjust proceeding, if they did not allow this Bill to pass. He did not deny that some frauds had been committed, but he strongly denied that the directors and promoters of the Bill were in any way a party to them. [The Earl of Besborough: The Report.] The Report did not directly make such a charge; but it stated that some persons had got a certain number of signatures improperly affixed to the contract deed. Was it not notorious, that there was no description of ingenuity which was not resorted to for the purpose of obtaining shares, as such large profit was often derived from speculating in them? It was known, also, that the stockbrokers had now lists of persons, called black lists, who were constantly engaged in the traffic of shares, and many of these persons had imposed on persons engaged in promoting English and Scotch railways, who were much better able to protect themselves from such proceedings than the promoters of an Irish railway; and all this arose from the imperfect state of the law. The noble Marquess then proceeded to read a list of the names of persons who had imposed upon the directors of this Company, and who had been referred to in the Report of the Committee, and showed that those persons were subscribers for shares in several English and Scotch Railway Companies to a much larger amount, than was the case with respect to the Dublin and Galway Railway. By referring to The Times newspaper, in which the advertisement for this Company first appeared, it would be found that out of twenty-four advertisements of railway companies published in it, only four required any reference at all; and in the Times of the 6th or 7th of November last—he did 1174 not then recollect which was the date—there were no less than fifty railway advertisements, all inviting the public to take shares, and of these only ten required any reference to be given. Thus the Dublin and Galway Railway Bill was now to be thrown out because they did that which had been done by four-fifths of all the railways in England, Scotland, and Ireland, when they were really in the market. But he would come to what had been described as the model of a railway, and of a board of directors, namely, the London and York, and to that model of a witness, Mr. Moatt. When that gentleman had been asked whether they had had any applications from men of straw, such as stable-boys and men of that class, he replied that they had not above twenty applications in which they had been imposed upon. If, therefore, that Company, which was so much cried up, had been imposed upon in twenty cases, how could it be expected that a number of Irishmen forced to resort to the London share-market should be more successful? That reminded him of another argument. The evidence of this witness showed that even great English companies did not disdain to give allotments of shares at first without inquiry, and that it was only when they got a position in the market that they took the precaution to have men of undoubted credit selected as their shareholders. In fact, it was quite necessary at the commencement of such undertakings that more than ordinary risk should be incurred. The witness stated that it was found to be always the case that when capital was coming in, it begot other capital from subscribers of greater respectability. It was a notorious fact that in the case of the Greenwich Railway, which now, he believed, carried as many passengers as any railway in England, that fully half of the capital, when the Bill passed through Parliament, was utterly bad, but that these shares afterwards fell into good hands. And in another railway, also—the Gloucester and Bristol Railway—which now conferred great benefits on the part of the country through which it passed, upwards of one-third of the subscription list, as it originally stood, was found to be bad, though the shares of this company were now selling, or had been selling two days ago, at 30 per cent. premium. He could not, therefore, see why they were to make an example of the Dublin and Gal- 1175 way Company, whilst others had been allowed to pass. It was quite possible for parties to get up fraudulent cases, for the purpose of extorting money from the directors. For instance, four persons, A, B, C, and D, might sign the subscription list for each other, and then if they found the speculation not to answer their wishes, they could go to the directors, and, under threats of exposing their own dishonesty, extort money from them. In this way, he could account for the petition of the person, or rather the name of Gerard Barry. No such man could be found, and though the name was one that sounded familiarly enough, it could not be discovered that this person had ever existed. The entire amount required to be subscribed in this Company, under the Standing Orders, was 810,000l., while the amount really subscribed was 819,000l., of which 67,200l. was found to be bad. But then by the alteration which had been proposed in the original plan, a saving of twenty miles would be effected, in consequence of the Galway line joining the Cashel line at Portarlington. A sum amounting in the entire to 228,000l. would, from this and other circumstances, be available over and above what was necessary to complete the line, independent of which the Great Southern and Western Railway Company now offered to subscribe 100,000l. additional capital if the Bill were now passed. The noble Marquess proceeded to refer to the evidence of Mr. Mulvany, the engineer, and of General Sir John Burgoyne, chairman of the Board of Works in Ireland, given before the Committee, to show the great importance of this line of railway, and then continued to say that he would humbly submit to the House that this Bill should be allowed to pass on the ground of its great utility to the country—on the ground that its rejection could effect no public good—on the ground that by throwing out the Bill they could do right to no person who had been wronged—that they could not remedy any imperfections in their law—and that they could do nothing except put a stop to one of the most important works that could be undertaken in Ireland, and that, too, at a most critical period in the affairs of that country. The present Session had not been either a very short or a very unimportant one, and yet he would put it fairly to the House what had they done for Ireland? They had certainly made an at- 1176 tempt to improve the social, political, and religious feelings of the country, by passing certain bills for the promotion of education, but they had effected nothing farther. They had old reports from Committees appointed over and over again to inquire into the state of Ireland, and to these they had now to add the report of the Commission over which his noble Friend (the Earl of Devon) had presided. All these reports described again and again the misery and wretchedness of the people, and the necessity of procuring employment for them, if the Legislature wished to alter their condition. But the Parliament had done nothing. They had made no additional grant for public works in Ireland—they had made no provision for improving the Poor Law, or for providing for emigration, or in any other way for benefiting the country; and yet now when a number of great capitalists came forward and offered to execute this great public work, which would give employment to the poor, develop the resources of the country, and add to its improvement in every possible way, and when all they required was permission to lay out their money, the House was about putting an entire stop to this most beneficial undertaking, solely on the ground that the directors had been deceived by fraudulent persons in London. It was not unlikely that such men as General Caulfield (and a more honourable, respectable, and venerable officer could not be named) would be unable to detect such parties, when men like Sir I. Goldsmid and Mr. Hudson had been deceived by them. He (the Marquess of Clanricarde) could not believe that the House would thus stop this Bill; it ought, he conceived, to be re-committed.
§ Earl Bathurst
, as chairman of the Committee on the Bill, wished to state that they had not felt themselves the less bound to report the frauds they found, because such practices might have existed elsewhere. In fact, the Committee had given no opinion on the Bill, nor was the House placed under the necessity, therefore, of sustaining any finding of theirs. The Committee had only reported that certain frauds had been committed; and they had left it to the House to decide whether those frauds so vitiated the Bill that it ought not to be passed.
The Earl of Wicklow
said, he was extremely sorry to find that he was compelled 1177 to vote against the further progress of the Bill. He believed that the work would be a most beneficial one for Ireland. But it should be remembered that that was the first case of gross and palpable fraud in connexion with the proceedings of railway companies that had been brought under their Lordships' notice; and he certainly thought that they ought not to allow those frauds to pass unpunished. He had a further reason for objecting to the passing of the Bill, and that objection was founded on the fact that their Lordships could have no security that the money necessary to construct the works would be forthcoming, and that those works would be completed.
§ The Earl of St. Germans
said, he could not agree in the remark as to the peculiar character of the parties deceived. The directors were not unsophisticated Irishmen, but, for the most part, gentlemen resident in London. It would not, in his opinion, be desirable that the House should interrupt the labours of the Committee on the Bill. It appeared to him, on the contrary, that they ought to allow that Committee to proceed, and to hear all the evidence that could be adduced in the case. He believed that it would be quite consistent with the practice of Parliament to allow supplementary subscription lists to be put in, and that practice might be adopted in the present case. He did not ask their Lordships to pause before they determined on rejecting the measure, on the ground that they should look more favourably on the Bill because it was one affecting Ireland, than they would look on a Bill affecting England. All he asked was, that justice might be done in the matter. He admitted that a case of great laxity and carelessness had been made out against the promoters of the line, but he did not think that they ought at once to determine at that stage on rejecting the Bill. Let the Select Committee proceed with its inquiries, and pronounce a decision on the merits of the case, after they had heard all the evidence that could be brought forward on the subject.
§ Lord Beaumont
said, that he should not have had the least hesitation in acceding to the Motion of the noble Earl, if he thought that by rejecting the Bill he would be punishing the parties who had committed those frauds. But the fact was, that they would not by that means be 1178 punishing those parties, but innocent persons, who had in no way contributed to those frauds. The individuals who had fraudulently obtained the scrip had since parted with it, at a considerable profit to themselves; and that scrip was now held by persons who were ready and able to pay up the amount of their shares. It appeared that they could not punish even the managers; for those managers had sold out the 500 shares which each of them had taken in the first instance. In his opinion, their Lordships ought, if possible, to adopt such measures as would prevent the sale of scrip immediately after it had been allotted; for that was the source of all the most objectionable proceedings in connexion with railway speculations. He considered the fairest course would be for the Committee to enter upon the consideration of the preamble of the Bill, and ascertain whether there were funds sufficient to carry out the project in case the Bill should ultimately pass. But he had only to observe in conclusion, that it seemed to him very expedient that the House should, without delay, adopt some general measure for the prevention of the perpetration of any similar frauds in future.
§ The Duke of Cleveland
fully agreed in the sentiment expressed by the noble Lord who had just sat down, that it was most desirable for that House to take some means to prevent such frauds as those complained of from being practised. It was alleged as an excuse for the conduct of the Company under consideration, that similar practices were carried on in all Railway Bills; but that was no ground for permitting a fraud which was detected from being punished. The present case was, it seemed, the first one in which those frauds had been found out; and it was then certainly the duty of Parliament to take cognizance of that which had been detected. The time had arrived when it became absolutely necessary to endeavour to put an end to the system of jobbing which was now going on; and before the present Session terminated he thought it indispensable that the Legislature should come to some general resolution on the subject—a course which would deter the promoters of railways hereafter from pursuing the line of conduct which they now did. One way he would suggest, by which he conceived the evil alluded to might be remedied, and that was, to in- 1179 troduce a clause into every Railway Bill to prevent parties to whom shares were allotted, and who were subscribers to the subscription contract, from selling their scrip until at least two-thirds of the money should have been paid up. He hoped the House would not suffer the Session to pass, however advanced it might be in the year, without coming to some general resolution on this subject.
§ Lord Redesdale
said, the real question before their Lordships was this:—A charge had been brought against certain parties of not having complied with the rules and regulations required by that House to be observed in its proceedings, and that charge having been fully brought home to them, were these parties to be allowed to go scot free? It was said, indeed, that their Lordships would not be punishing the guilty individuals; that the weight of their censure would fall upon those who purchased shares bonâ fide. Now those who had purchased shares knew very well they were doing an illegal act; and they should, therefore, be satisfied to take the risk and the consequences of their own conduct. The question here was, not whether or not this Bill would be a good measure for Ireland, but whether that House was prepared or not to uphold its own rules and Standing Orders? If it was a reason that these parties should not be punished because others had been guilty of similar practices, not a pickpocket who was detected in his guilt but might say, "Oh, you ought not to inflict punishment on me alone; there are twenty other persons picking pockets in the same place, you caught me—am I alone to suffer?" He had only to say in conclusion, that this was an occasion on which the House ought to enforce its own rules, if it did not make up its mind to let them be all considered as mere waste paper in future.
§ Lord Monteagle
feared that when once a spirit of gambling got abroad, it would be impossible for any measures they might introduce to repress it. There were many laws at this moment in existence to prevent fraudulent practices, but they were found insufficient for that purpose. He doubted very much whether throwing out the present Bill would lead to any such salutary consequences as were calculated on. But at the same time, he should say that after the fraud which had been discovered in this matter, to pass this Bill now, would be productive of mischievous 1180 results. The House having adopted certain rules and regulations for the management of its business, was bound to enforce them; and though he confessed he did so with some reluctance, believing that this measure was calculated to be of great benefit to Ireland, he felt constrained to give his vote in favour of the Motion of the noble Earl behind him (the Earl of Besborough). He did not think that those gentlemen who took an active part in the management of this Company were guilty of fraud themselves; but they had not acted with sufficient caution, and were bound to have used more care in preventing the interests of others which were entrusted to them from suffering through their neglect. The rejection of the measure, however, did not by any means prejudice the undertaking hereafter; and as it was one calculated to be of great benefit to Ireland, he regretted that it should be postponed even for a time.
§ The Earl of Devon
would briefly state why he intended to vote against the proposition then before the House. He would be glad to know how it was in any way necessary to the ends of justice that this Bill should be thrown out? Who were the parties to whom they were doing justice by rejecting this measure? Was it necessary to do so, with respect to the individual who had presented a petition to that House? Was it in justice to the landed proprietors through whose properties the line was to pass, that they adopted this course? Was it in justice to any other project that might be more advantageous, that they were called upon to throw out this Bill? No such thing. It was merely in justice to the House of Lords itself they were asked to do so. Now, such being the case, he thought there were peculiar circumstances in this matter which made it fit for them to consider whether it was right to take this means of vindicating their own orders. The Report of the Select Committee charged certain promoters of the Bill with having been guilty of frauds. Now, he did not think there was any evidence before it which sustained such an allegation. It was said the course the House was about adopting was for the purpose of punishing the parties who infringed its Standing Orders. Now, they would not be punishing those parties; they would be punishing others. Was not the arm of the law, however, sufficiently long to reach those who were really guilty? The 1181 throwing out of a measure of so much importance as that was not the way to proceed. They might, even in vindicating their own orders, commit a great public evil in attempting to punish parties who were guilty of a fraud that they could not reach after all. He concluded by announcing his intention to oppose the Motion before the House.
The Marquess of Clanricarde
, in explanation, observed that, notwithstanding all the allegations they heard about the Standing Orders, the reception of that petition had been an infringement upon them, such as had not taken place on any other Railway Bill in England or Scotland.
§ The Duke of Wellington
wished to make only one observation on what had fallen from his noble Friend near him (the Earl of Devon). There could be no doubt that the evidence went to show that nothing more could be charged against the directors than negligence in the performance of their duty. He had to observe, that in the commencement of the Report, the directors had been called upon, if they thought proper, to answer those charges, but as they had not thought fit to do so, he thought the proposition of the noble Lord must fall to the ground.
§ On Question, that the words proposed to be left out stand part of the Motion? House divided:—Contents 35; Non-contents 8; Majority 27.
§ Resolved in the Affirmative, and she further consideration of the Bill put off for three months.