Re Shields' Estate

JurisdictionIreland
CourtLand Commission (Ireland)
Judgment Date28 November 1900
Date28 November 1900

Appeal.

Before LORD ASHBOURNE, C., and FITZ GIBBON, WALKER, and HOLMES, L.JJ.

SHIELDS AND OTHERS
OWNERS;

THE GOVERNOR AND COMPANY OF THE BANK OF IRELAND,
PETITIONERS

Coe and The District Savings BankENR 3 De G.F. & J. 335.

Copland v. Davies I. R. 3 Eq. 31; sub-nomine Davies v. Kennedy.

Copland v. DaviesELR L. R. 5 H. L. 358.

Davies v. Kennedy I. R. 2 Eq. 668.

Davies v. Kennedy I. R. 3 Eq. 33.

Davies v. Kennedy I. R. 3 Eq. p. 693.

De Robeck v. Cloncurry I. R. 5 Eq. 588.

Ex parte Coe 3 De Gex F. & J. 338.

Ex parte Coe 3 DeG. F. & J. 335.

Ex parte WilsonENR 1 Atk. 217.

Foley v. Hill 2 H. L. Cas. 28.

Goodwin v. RobartsELR L.R. 10 Ex. 337,351.

Guinness' Case 1 Ir. Jur. 359.

Hayden v. CarrollENR 2 Ridg. 545.

Hayden v. Carroll 3 Ridg. P. C. 545.

In re Guinness 1 Ir. Jur. 359.

In re Kennedy I. R.1 Eq. 31.

Moore v. Ulster BankUNKIR I. R. 11 C. L. 512.

O'Flaherty v. M'Dowell 6 H. L. Cas. 142.

Overend, Gurney & Co. v. GurneyELRELR L. R. 4 Ch. 701; L. R. 5 H. L. 480.

R. S. Guinness 1 Ir. Jur. 359.

Re R. S. Guinness 1 Ir. Jur. 359.

Stafford v. Henry 12 Ir. Eq. R. 400.

sub nomine Copland v. DaviesELR L. R. 5 H. L. 358.

Banker —— Banker or money-lender — Receipt of money on deposit-receipt — Discount of bills — No cheque-books or current accounts — No issue of notes — Registration of deeds — 33 Geo. 2, c. 14 (Ir.).

172 THE IRISH REPORTS. [1901. M. R. as under it. For instance, a man in poor circumstances makes a 1901. small provision for his wife in lieu and in bar of dower and thirds. HOGAN He becomes rich, and yet it has always been held that the change HOGAN. in his circumstances makes no difference, because it was a matter of contract at the time of marriage. It was to be the measure of what he was to give, and she to take. For these reasons I am of opinion that the widow is entitled to the £500 under the settlement, but to nothing else. InasÂmuch as admittedly she is barred as to the residue, the £500, provided by the statute could not in her case be " in addition " to her distributive share. Solicitor for the plaintiff : J. A. Sinnott. Solicitor for the defendants : Martin .Haggard. W. L. Appeal. 1900. Nov. 1, 2, 5, 6, 28. SHIELDS AND OTHERS OWNERS; THE GOVERNOR AND COMPANY OF THE BANK OF IRELAND, PETITIONERS (1). Banker — Bankers' Act — Banker or money-lender— Receipt of money on deposit-receipt—Discount of bills—No cheque-books or current accounts—No issue of notes—Registration of deeds-33 Geo. 2, c. 14 (Ir.). Down to the year 1879 P. S. carried on business as a banker, or moneyÂlender, in the towns of D., A., and C., in the county of Tyrone, in his own name. He had no other business. After that he carried it on with his son M. S. as P. & M. S. There was not any deed of partnership. In 1890 P. S. conveyed all his property to M. S., who, since that time, was the sole owner of the business. The premises where the business was carried on consisted of two rooms in a house in each of the towns of D., A., and C., one of which was occupied by S., and the other by his clerk. He attended one day in each VOL. I.] CHANCERY DIVISION. week in each of these places. The course of business was this :—Money was lent on promissory notes, payable in twelve weeks, with interest at the rate of id. in the £1 per week. Advances were also made on mortgages. The firm had been in the habit of receiving large sums of money on deposit, for which they gave promissory notes, payable three months after date. In 1893 they substituted deposit receipts similar in form to those issued by banks, and the amount of money received on these was very large. They also lent small sums, up to £5, without taking any security. They cashed " crop notes" and small American drafts. The books kept by S. were of the most primitive sort, and not such as were usually kept by bankers. S. did not issue notes, cheques, pass-books, letters of credit, or bills on foreign or British banks, and there were not any current accounts kept with the firm. Evidence was given to show that the establishment kept by S. was commonly known as S.'s bank, and the officials of the Bank of Ireland had also called the firm bankers. M. S. obtained advances from the Bank of Ireland, with whom he had deposited by way of equitable mortgage the title deeds of property to secure the advances. These deposits were not accomÂpanied by any memorandum in writing, and were therefore incapable of registration. By indenture, dated the 14th January, 1899, M. S. conveyed all his property to trustees upon trust to realize and divide the proceeds among his creditors : Held (reversing the decision of Ross, J.), that M. S. was a banker within the meaning of 33 Geo. 2, c. 14 (Ir.), and that the mortgages created by deposit of title deeds, not having been registered, were levelled. APPEAL from the order of Ross, J., dated the 9th July, 1900, disallowing the cause shown against the conditional order for sale. The petition for sale had been presented by the Bank of Ireland, on the 17th October, 1899, on foot of four equitable mortgages, dated the 29th May, 1893, 7th May, 1894, 30th May, 1895, and 6th August, 1898, created by deposit of title deeds by Michael Shields with the bank to secure advances. The lands affected were the lands of Altaglasson in the county of Tyrone. These equitable mortgages were not accompanied by any memoÂrandum in writing, capable of being registered, and so were not registered. At the date of the petition there was due to the bank by Shields the sum of £15,057 15s. 11d. for principal, together with £893 5s. 7d. for interest. On the 14th January, 1899, at a meeting of the creditors of Shields, it was resolved that the bank should be wound up, and 174 THE IRISH REPORTS. [1901. Appeal. that the property should be vested in James Riordan and Francis 1900. Shields. In re By indenture dated the 14th January, 1899, and made between SHIELDS' ESTATE. Michael Shields of the first part, James Riordan and Francis Shields of the second part, the Rev. William Glenn and four others of the third part, and sixty-five persons, creditors of Michael Shields of the fourth part, the said Michael Shields assigned and conveyed all his property, except certain personal chattels, to James Riordan and Francis Shields upon trust to sell and realize and distribute the proceeds among his creditors ; and by two later deeds Shields assigned and conveyed all his property to these two trustees for the same purpose. According to the provisions of the Irish Bankers' Act, 33 Geo. 2, c. 14 (Ir.), the mortgages to the Bank of Ireland were void, unless they were registered, if Shields was a banker, and the sole question in the case was—Was Shields a banker within the meaning of that statute ? In or about 1850, there was in existence at Altmore, in the county of Tyrone, the Altmore Loan Fund, under the control of the Loan Fund Board, pursuant to the provisions of 6 & 7 Viet. c. 91. Patrick Shields was an official in connection with this Loan Fund. It ceased to exist in 1860, but Patrick Shields continued to carry on a similar business, assisted by his sou Michael. He carried on business at Dungannon, Cappagh, and Carrickmore, in the county of Tyrone, where he received money on deposit at interest, and employed same in discounting bills and notes, and in making advances in other ways to the public. This constituted his sole business, which he carried on in his own name down to 1879, and, after that, under the name of P. & M. Shields. There was no deed of partnership executed between Patrick and Michael Shields, nor did they ever take accounts between themselves as to profits. Between 1871 and 1886, £32,476 of the money so deposited was invested in the purchase of the lands, the subject-matter of the petition. By indenture dated the 1st March, 1890, Patrick Shields transferred his interest in the business to Michael, who carried it on in the same manner until the 7th January, 1899, when he stopped payment. At the date of the stoppage, Michael Shields owed £122,657 to 1066 depositors. The forms in which the deposit receipt was given was as follows :— DEPOSIT RECEIPT. P. & M. SHIELDS, BANKERS, Altmore, Pomeroy, Tyrone. RECEIVED from sterling, bearing interest from this date at £4 per cent. per annum, repayable three months after demand. Dated this P. & M. SHIELDS. Per Signed, About the 13th May, 1893, Michael Shields opened an account with the Bank of Ireland at Omagh, and, on the occasion of his doing so, R. G. Johnston, the agent of the Bank of Ireland at Omagh, wrote a letter to his principals in Dublin :— " OmAear, 8th May, 1893. "MICHAEL RIELDs.—Overdraft, £12,000. ",DEAR . . . Is desirous of opening an account with the Bank, with permission to overdraw to the extent of £12,000. Mr. Shields is a private banker, receiving deposits from and lending money through the country on promissory notes and mortgages. He has, roughly speaking, £25,000 on deposit with him, and has over £40,000 lent in the manner I speak of. The following is a rough calculation of his position : £40,000 advanced on promissory notes and mortgages, £32,700 invested in lauded property, £3000 house property, £8000 Murphy & Shields, spinners, Lurgan. " I would most strongly urge the Board to meet Mr. Shields' wishes, as their connection is, by far, the most valuable in this neighbourhood, and his position is beyond all question." In all proceedings in the Superior Courts, or the County Courts, brought to recover money, the Shields described themÂselves as bankers, and the letter-paper used in their correspondence 176 THE IRISH REPORTS. [190]. " BANK OF IRELAND OFFICE, " OMAGH, 4th May, 1897. "DEAR STE,—I received in Mr. Henry Owens' lodgment to-day a deposit receipt, dated 8th January, 1897, in name of Joseph Conway, senior, £50 of the issue of your Bank, and, if in order, I shall thank you to send me a cheque for the amount. He does not claim the interest, if any. "...

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4 cases
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    ...of banking even though it issued no cheques and kept no current accounts but only issued deposit receipts,repayable on notice, see Re Shields, 1901, 1 Irish Reports, p. 172: or only kept deposit accounts from which the depositors could withdraw their money on demand or on notice, this bein......
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  • Commercial Banking Company Ltd v Hartigan and Others
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    ...of the 1900 Act as being persons "bona fide carrying on the business of banking" and must therefore, succeed. In re Shields' EstateDLTR [1901] 1 I.R. 172; 35 ILTR. 3 applied. ...

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