ing been made by the assent of all the stockholders, that the directors of both roads, and the majority of the stockholders, must conduct and administer said roads accordingly, and that their liability to the stockholders was just the same as if it had been done by the legislature. But that the lease and the terms and conditions, although the earnings of the roads, and the incomes had been all mixed up and blended together, did not provide for a union of interest or of the capitals of the respective roads, or of an equality of dividends between the stockholders of the two corporations. It was further held, that "such lease or contract between the roads must be construed with reference to the objects proposed by the existing charters of each at the time the lease or contract was made, and its construction or operation can not be effected or changed by any change of the plans, purposes, or objects of the corporation without or beyond the existing scope of their chartered powers at the time of the making of such lease or contract. Such roads may, as between themselves, vary the terms of their agreement or contract with each other, and may consent to a dif ferent appropriation of the funds, profits, or dividends from that provided for in the original contract; but stockholders in either roads, who have not thus assented, may, in equity, hold both corporations to perform their original contract, and apply their funds and profits in the way provided for in the original contract, so far as relates to themselves. Hence, when the fundamental contract between two roads provides that all disputes between the two roads shall be settled by arbitration, and one road has made an illegal misapplication of funds or profits belonging to both, with the assent of a majority of the other road, if stockholders in the latter road, not thus assenting, bring their bill to recover their share of such profits, this court will enjoin both roads, if necessary, from settling or attempting to settle the claims, made by such stockholders, by arbitration. The dividends which are divisible among the shareholders of a corporation must be considered as their own property, and can not be applied by the directors to any purpose not included in their charter, or fundamental contract, without the consent of such shareholders. To constitute an illegal application of the funds or money of a corporation, it is not necessary that there should be any intentional wrong or actual fraud; and to give this court jurisdiction in equity in such a case, the plaintiff need not allege or prove any such actual and willful fraud or collusion on the part of the company or companies, or the directors thereof. But when the money that should have been divided among the stockholders has been applied by a company or companies to a purpose not warranted by, and not within the scope of, the charter, or fundamental articles of agreement, that constitutes a sufficient illegality to give a court of equity jurisdiction, and such proceedings of a majority of such company or companies, and of the governing body or power thereof in such cases, will be treated in equity as a breach of trust toward the minority, and as a fraud upon them, if they have not assented to such misapplication; and courts of equity will prevent such illegal application of such funds or profits, and such fraud and breach of trust, by injunction, and will relieve against it when committed, at the suit of such stockholders as have not assented thereto. Cohen v. Wilkinson et al., the Directors of the Direct London & Portsmouth R. Co., and the Corporation, 5 R. Cases, 565. Cohen was a shareholder (and it does not appear that he was the owner of more than one share) in the Direct London and Portsmouth Railroad Company, which was chartered to build a railway from London to Portsmouth. After building a portion of the railway the company resolved to abandon the project; but about one month before their powers for taking land had expired, in consequence of an agreement with another railway company, they de termined, with the assent of the majority of the stockholders present at a general meeting convened for that purpose, to complete four miles of the railway, as far as L., and then stop. The court held that such a proceeding was illegal, and contrary to the charter, to use the funds for the purpose of completing the road to L. alone, because the funds were obtained for building the entire line specified in the charter, and not to L. alone, and an injunction granted accordingly. In deciding this case, Lord LANGDALE said, (see pages 571-2) that "The plaintiff is a person who has subscribed and paid his money, no doubt on the faith of an undertaking sanctioned in parliament on the ground of its being expected and intended to produce public benefits by its completion. His object may be his own particular benefit, but his advances are made on a scheme, the whole of which must be considered as that which alone has been approved and authorized by parliament, which is to be conducted and managed in the way approved by parliament, for the deed proposed by parliament, and for no other end, and the governing body of which must be considered to have entered into the obligation to complete the work authorized. It is on these expectations that the shareholders become members; and I am of opinion that they are entitled to have these expectations realized, if they can be. The company is not like a partnership for general trading a partnership in which one portion of the business may be encouraged and another discouraged or abandoned, according to the contingencies of trade, and in which there is a general authority to use the capital to the best advantage; but it is a partnership for a public purpose, for effecting a work which it is a duty to complete, and for which alone the capital is advanced in shares, or authorized to be raised. The obligation to complete the work appears to me to be co-extensive with the authority to make it. Neither this act, nor any of these acts, contains authority to substitute a less work, or part, for the whole; and if the governors or directors of the company take on themselves to determine that they will not perform the whole work, but will apply the capital collected on the faith of the whole work being completed, in completing only a part of it, I am of opinion that the determination is without authority, and contrary to the provisions of the act of parliament." This case is of a novel character, but it shows how strict the English courts are in compelling corporations to carry out the very object specified, and that they can neither stop short of it, or go beyond it. In Hichens v. Congreve, 4 Russell, 576, the Lord Chancellor said: "The suit is instituted by certain shareholders on behalf of themselves, and all others who may choose to come in and take the benefit of the suit. * * * "Here is a fund in which all the shareholders are interested; £15,000 has been improperly taken out of it; a fraud has been committed on them all. Is it necessary that all should come into a court of justice for the purpose of joining in a suit with a view to obtain redress? It is possible that the number of shareholders may be six thousand, for the capital of the company is fixed by the act of parliament at £300,000 divided into shares of £50 each and justice never could be obtained, if any very great number of plaintiffs were put on the record. It is said that there is nothing on the face of the bill which shows that the shareholders are so numerous, that they could not all be joined as parties without inconvenience. I think it does appear sufficiently that if all were joined the number of complainants would be inconveniently great; first, because the shares are 6,000 in number; and, secondly, because it appears, by the act of parliament, that there were then upwards of two hundred shareholders. It is clear, therefore, that justice would be unattainable, if all the shareholders were required to be parties to this suit. It having been suggested that each shareholder should bring a suit, the Lord Chancellor said: "In the present case, it appears to me, that justice may be done in one suit. All the shareholders stand in the same situation; the property has been taken out of their common fund; they are entitled to have that property bought back again for the benefit of the concern. "When all parties stand in the same situation, and have one common right, and one common interest, in what respect can it be inconvenient that two, or three, or more, should sue, in their own names, for the benefit of all?" See, also Wallworth v. Holt, 4 Myl. & Cr., 619. Burbridge v. Burton, 2 Beav., 539, 559. 22 & n. 1. Foss v. Harbottle, 2 Hare, 489. In this last case the court say, distinctly, that, "if a transaction be void, and not merely voidable, the corporation cannot confirm it so as to bind a dissenting minority of its members." See page 505. See, also, Preston v. Grand Collier Co., 11 Simons, 327.1 In the case of Bromley v. Smith, 1 Simons, 11, the court said: "Where a matter is, necessarily, injurious to the common right, the majority of the persons interested can neither excuse the wrong, nor deprive all other parties of their remedy by suit. "The attorney-general may file an information, in a case like this, in respect of the public nature of the right; and the proceeding must be by the attorney-general where all persons are parties to the abuse; but where that is not the case, I am not aware of any." In Bagshaw v. the Eastern Union Railway Company, (6 R. Cases, 136,) the Lord Chancellor said: "I am clearly of the opinion, that those who subscribed for the purposes of the two acts have a right to have their money applied to the purposes held out to them, not only by those acts, but by the resolutions of the company, stating the purposes for which their |