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them by their agents. In some cases, among the misleading statements laid before shareholders to obtain their consent to a new project, will be found an abstract of the earnings of a previously-executed branch or feeder to which the proposed one bears some analogy. These earnings are shown (not always without "cooking") to be tolerably good and improving; and it is argued that the new project, having like prospects, offers a fair investment. Meanwhile, it is not stated that the capital for this previously-executed branch or feeder was raised on debentures or by guaranteed shares at a higher rate of interest than the dividend pays; it is not stated that as the capital for this further undertaking will be raised on like terms, the annual interest on debt will swallow up more than the annual revenue: and thus unsuspecting shareholders— some unacquainted with the company's antecedents, some unable to understand its complicated accounts-give their proxies, or raise their hands, for new works which will tell with disastrous effect on their future dividends. In pursuit of their ends, directors will from time to time go directly in the teeth of established regulations. Where it has been made a rule that proxies shall be issued only by order of a meeting of the proprietors, they will yet issue them without any such order, when by so doing they can steal a march on dissentients. If it suits their purpose, they will occasionally bring forward most important measures without due notice. In stating the amount of the company's stock which has voted with them on a division, they have been known to include thousands of shares on which a small sum only was paid up, counting them as though fully paid up.

To complete the sketch, something must be said on the management of board meetings and meetings of shareholders. For the first-their decisions are affected by va rious manoeuvres. Of course, on fit occasions, there is a

whipping-up of those favourable to any project which it is desired to carry. Were this all, there would be little to complain of; but something more than this is done. There are boards in which it is the practice to defeat opposition by stratagem. The extension party having summoned their forces for the occasion, and having entered on the minutes of business a notice worded with the requisite vagueness, shape their proceedings according to the char acter of the meeting. Should their antagonists muster more strongly than was expected, this vaguely-worded notice serves simply to introduce some general statement or further information concerning the project named in it; and the matter is passed over as though nothing more had been meant. On the contrary, should the proportion of the two sides be more favourable, the notice becomes the basis of a definite notion committing the board to some important procedure. If due precautions have been taken, the motion is passed; and once passed, those who, if present, would have resisted it, have no remedy; for in railway government there is no "second reading," much less a third. So determined and so unscrupulous are the ef forts sometimes made by the stronger party to overcome and silence their antagonists, that when a contested measure, carried by them at the board, has to go before a gen eral meeting for confirmation, they have even been known to pass a resolution that their dissentient colleagues shall not address the proprietary!

How, at half-yearly and special meetings, shareholders should be so readily led by boards, even after repeated experience of their untrustworthiness, seems at first sight dif ficult to understand. The mystery disappears, however, on inquiry. Very frequently, contested measures are carried quite against the sense of the meetings before which they are laid, by means of the large number of proxies previously collected by the directors. These proxies are

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obtained mostly from proprietors scattered everywhere throughout the kingdom, who are very generally weak enough to sign the first document sent to them. Then, of those present when the question is brought to an issue, not many dare attempt a speech; of those who dare, but few are clear-headed enough to see the full bearings of the measure they are about to vote upon; and such as can see them are often prevented by nervousness from doing justice to the views they hold.

Moreover, it must be borne in mind that the party displaying antagonism to the board are apt to be regarded by their brother proprietors with more or less reprobation. Unless the misconduct of the governing body has been very glaring and very recent, there ever arises in the mass a prejudice against all playing the part of an opposition. They are condemned as noisy, and factious, and obstructive; and often only by determined courage avoid being put down. Besides these negative reasons for the general inefficiency of shareholders' resistance, there are sundry positive ones. As writes a Member of Parliament who has been an extensive holder of stock in many companies from the first days of railway enterprise :-"My large and long acquaintance with Railway Companies' affairs, enables me to say, that a large majority of shareholders trust wholly to their directors, having little or no information, nor caring to have any opinion of their own. . . . Some others, better informed but timid, are afraid, by opposing the directors, of causing a depreciation of the value of their stock in the market, and are more alarmed at the prospect of this temporary depreciation than at the permanent loss entailed on the company by the useless, and therefore unprofitable, outlay of additional capital. . . . Others again, believing that the impending permanent evil is inevitable, resolve on the spot to sell out immediately, and to keep up the prices of their shares, also give their support to the directors."

Thus, from lack of organization and efficiency among those who express their opposition, and from the timidity and double-facedness of those who do not, it happens that extremely unwise projects are carried by large majorities. Nor is this all. The tactics of the aggressive party are commonly as skilful as those of their antagonists are bungling. In the first place, the chairman, who is very generally the chief promoter of the contested scheme, has it in his power to favour those who take his own side, and to throw difficulties in the way of opponents; and this he not unfrequently does to a great extent-refusing to hear, putting down on some plea of breach of order, browbeating, even using threats.* It generally turns out too, that, whether intentionally or not, some of the most important motions are postponed until nearly the close of the meeting, when the greater portion of the shareholders are gone. Large money-votes, extensive powers, unlimited permits to directors to take, in certain matters, “such steps as in their judgment they may deem most expedient,”—these, and the like, are left to be hurried over during the last half-hour, when the tired and impatient remnant will no longer listen to objectors; and when those who have personal ends to serve by outstaying the rest, carry everything their own way. Indeed, in some instances, the arrangements are such as almost to ensure the meeting becoming a pro-extension one towards the end.

This result is brought about thus:—A certain portion

*We may remark in passing, that the practice of making the chairman of the board also chairman of the half-yearly meetings, is a very injudicious one. The directors are the servants of the proprietary; and meet them from time to time to render an account of their stewardship. That the chief of these servants, whose proceedings are about to be examined, should himself act as chief of the jury, is absurd. Obviously, the business of each meeting should be conducted by some one independently chosen for the purpose; as the Speaker is chosen by the House of Commons,

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of the general body of proprietors are also proprietors of some subordinate work-some branch line, or steamboats, or canal, which the Company has purchased or leased; and as holders of guaranteed stock, probably having capi tal to take up further such stock if they can get it, they are naturally favourable to projects that are to be executed on the preference-share system. These hold their meeting for the declaration of dividend, &c., as soon as the meeting of the Company at large has been dissolved; and in the same room. Hence it happens, that being kept together by the prospect of subsequent business, they gradually, towards the close of the general meeting, come to form the majority of those present; and the few ordinary shareholders who have been patient enough to stay, are outvoted by those having interests quite distinct from their own quite at variance with the welfare of the Comrany.

And here this allusion to the preference-share system, introduces us to a fact which may fitly close this detail of private interests and questionable practices—a fact serving at once to illustrate the subtlety and concert of railway officialism, and the power it can exert. That this fact may be fully appreciated, it must be premised, that though preference-shares do not usually carry votes, they are sometimes specially endowed with them; and further, that they occasionally remain unpaid up until the expiration of a time after which no further calls can be legally made. In the case in question, a large number of £50 preference. shares had thus long stood with but £5 paid. Those desirous of promoting extensions, &c., had here a fine oppor tunity of getting great power in the Company at small cost; and as we shall see, they duly availed themselves of it. Already had their party twice tried to thrust the proprietary into a new undertaking of great magnitude. Twice had they entailed on them an expensive and harass