business, upon trust thereout to provide for the maintenance and education of all her children during their minorities, and until her estate should be divisible under the trusts of her will, and after the youngest of her children should attain the age of twenty-one years in trust to divide the same among all her children equally; and she empowered her trustees, after the expiration of the said term, to advance and pay to her said son Philip Thomas Taylor his share under her will.

were

The testatrix left five children, the said Philip Thomas Taylor and four daughters, the youngest of whom attained twenty-one in Oct. 1885, and shortly afterwards this action was commenced by the four daughters, the eldest being a married woman, against the trustees, for an account on the footing of wilful default, and for administration of the testatrix's personal estate; and by an order dated the 14th May 1887 the following inquiries and accounts directed: (1) An inquiry of what the testatrix's estate consisted at the time of her death. (2) An account of the dealings and transactions of the defendants in the carrying on of the business of the testatrix at Gooseheys Farm from her death to Sept. 1877. (3) An account of the receipts and payments of the defendants in respect of the estate of the testatrix other than those comprised in account No. 2. (4) An inquiry of what the testatrix's estate consisted at the date of the order. By a subsequent order, dated the 15th Dec. 1887, these accounts and inquiries were extended so as to include the estate of the testatrix's late husband, Philip Taylor, from whom most of the estate belonging to the testatrix at her death was derived. The trustees, one of whom was a farmer and the other a cattle dealer, had not kept any proper accounts, and the inquiries and accounts were prosecuted in chambers for about two years without any substantial progress being made. On the 11th Nov. 1889 an order was made referring the inquiries and accounts to one of the official referees under sect. 56 of the Judicature Act 1873.

The official referee made his report, dated the 24th Dec. 1889, and filed the 8th Jan. 1890, which, after setting out the particulars of the testatrix's estate at the time of her death in answer to inquiry No. 1, and stating the number and ages of her children, proceeded as follows:

The trustees, who proved the will and shortly afterwards took out administration de bonis non to the estate of Philip Taylor, allowed the children to occupy the farmhouse, and employed the son as their bailiff in managing the farm. All sales and purchases were effected by the trustees, and they paid about once a week to the son the moneys required whether for labour and expenses on the farm or for household expenses. These sums were never distinguished, and in this account I have necessarily included payments for household expenses among the payments on account of the farm. This mode of conducting the business went on until the term of the lease expired in Michaelmas 1877. Philip Thomas Taylor then became tenant of the farm on his own account, and acquired certain farming and household effects under the will. He allowed his four sisters to remain in the farmhouse, and provided for their support. On taking over the farm Philip Thomas Taylor took over part of the assets, and his liability to the trustees was valued at 6891. 17s. 6d. The trustees (who had power from time to time to advance to P. T. Taylor his share of the estate, and also to provide maintenance for the children) allowed this valuation to

[CHAN. DIV.

remain unpaid, and from time to time furnished P. T. Taylor with moneys towards household expenses, and with further moneys towards meeting his expenses on the farm by occasional payments of rent, tithes, or other liabilities, and by money payments from time to time. Some portion of these payments could be traced to specific household expenses; others to specific farm expenses; while in the remaining instances it was not The total possible to discriminate between the two.

amount so paid between 1877 and 1880 was 764l. 18s. 7d. None of these payments were made in express terms by way of maintenance and advances, but as the trustees had power to make them I have allowed them in account No. 3 as payments under the maintenance and advancement powers, notwithstanding any defect in the form of the transactions. There appeared to be no doubt that the most beneficial way of providing a home for the children was to allow them to be kept by P. T. Taylor at the farmhouse, and to supply such pecuniary assistance as was required to enable the farm to be kept on, so long as there was a prospect of its being worked successfully. In the year 1880 the farming had become unprosperous, and P. T. Taylor gave up the farm and made an arrangement with his creditors under which the trustees obtained a sum of 5321. 4s. 2d. on account of the valuation debt of 6891. 178. 6d. After this date the trustees provided a cottage for the daughters and maintained them there at an expense of little more than 150l. a year.

In respect of account No. 2, I report as follows:

The trustees have received 97581, 0s. 4d. and have paid 98231. 6s. 11d., leaving a balance in their favour of 65l. 68. 7d.

In respect of account No. 3, I report as follows:

The trustees have received 5061l. 19s. 6d. and have paid 50801. 78. 2d., leaving a balance in their favour of 181. 7s. 8d.

On the 21st Feb. 1890 a motion was made by the plaintiffs to remit this report to the official referee, or some other official referee, with directions that such accounts should be taken in the way usual in the Chancery Division before a chief clerk and vouched accordingly; that directions should be given to such referee to take the accounts rendered by the defendants, and filed before the date of the order of reference; and that directions should be given to such referee to state in his report which of the items in the accounts rendered by the defendants had been allowed and disallowed by him respectively, and to show what, if any, sums not mentioned in such accounts he had charged against the defendants.

The motion having been opened was adjourned at the suggestion of the judge, and on the 6th March 1890 the official referee, after an interview with the judge, and at his request, made a further report, which, so far as is material, was follows:

as

These accounts have been prosecuted in chambers for more than two years without making any effectual progress, and were then referred to me. The failure in chambers was plainly due to the fact that the case was one to which the customary procedure in chambers was quite inappropriate, and it was no doubt sent to me for that reason.

The method pursued in chambers in taking accounts

is

1. To require an account from the accounting party or parties to be verified by affidavit.

2. To have the items of this account vouched, and to take evidence by affidavit (with cross-examination occasionally) as to every disputed item.

3. To allow, disallow, or vary each item from beginning to end of the account.

The cases which occur may be divided into three classes:

1. Where the accounting party is able to produce and verify an approximate account, and the details are not too extensive or complicated.

2. Where the accounting party is unable to produce and verify an approximate account.

3. Where the accounts are so extensive or complicated that the chambers procedure involves an amount of delay equivalent to a denial of justice.

In the first class of cases the methods employed in chambers (though necessarily slow) bring out all the exact details, not only of the items disputed before the chief clerk but also of the items (generally the great majority of the whole) which have been accepted or not seriously questioned before him.

Cases of this description to which the methods of chambers are applicable are now very seldom sent to official referees, for the obvious reason that a chief clerk having at his disposal a staff of junior accountant clerks to do the vouching and other mechanical work, can deal with them much more rapidly than an official referee who works single-handed.

In the second class of cases the procedure of chambers breaks down altogether (as it did in this case for two years) from the impossibility of getting an account from which to start the inquiry.

In the third class the chambers procedure practically breaks down from enormous delay, even though a staff of clerks is available for the work. An illustration of this may be seen in the case of Macintosh v. Great Western Railway Company, in which it was held by the Court of Appeal that a chief clerk was not at liberty to depart even in so extreme a case from the usual form of certificate. The result, I believe, was that, after some twenty or thirty years of useless and costly litigation, the executors of the plaintiff (then long dead) were driven to accept a lump sum in compromise rather than continue the contest.

It is chiefly cases of the second and third classes which according to the recent practice have been sent to official referees.

Turpin v. Pain was a case involving the difficulties both of the second and third classes.

The testatrix appointed as trustees her two brothers, one a farmer, the other a cattle dealer. They, though very suitable persons for carrying on the management of a trust farm, knew very little about accounts, and kept none beyond their ordinary market books of sales and purchases and the cheques and pass-books of the executorship account.

After a lapse of many years these materials were insufficient to enable them to produce an approximate account.

They severed in their defence. One of them gave such materials as he had or could discover from the plaintiffs to an accountant to do what he could with them, and the other entrusted his solicitor with a like duty, and they produced accounts for their respective employers, which were not in harmony with one another, and were too defective in form to supply the basis of investigation in the usual way. The trustees could not verify these accounts on oath, and the accountant could say no more than that his account was as good as it could be made with such materials as he had.

If I had insisted on waiting for the production of a suitable account to work upon I should probably have spent another two years or more to as little purpose as the first two had been spent in chambers.

I therefore pursued a course analogous to that which I have found to work satisfactorily in dealing with the numerous complicated accounts which have been referred to me from the Queen's Bench Division.

I collated such documents as could be found with the viva voce evidence of everyone who knew anything about the matter, and among others of the testatrix's eldest son (one of the five residuary legatees), who had managed the farm for his mother while she lived, and had been continued as bailiff by the trustees after her death. Fortunately he had a book in which he had in an informal way made entries of the sales and purchases effected by the trustees in carrying on the farm, as well as notes of the money expended by himself for wages, maintenance of his four infant sisters at the farmhouse, and other petty outgoings.

With these materials I was able after a close investigation of eight days to get at the aggregate expenditure and receipts of the trustees, and after I had made some progress with the evidence I obtained from the accountant who had acted for one of the trustees a fresh account on lines which I indicated to him, which greatly

[CHAN. DIV.

assisted me, though it was not an account which I could have taken as the basis of investigation on the chambers method, because it was not in its form and character suitable to be so dealt with, and because in fact it was essentially my rough account, and not one by which either of the trustees could be held bound.

I understand that it has been suggested that the result attained by the method I pursued does not give the same facility for reviewing my decision on particular items which the procedure in chambers resulting in a common form certificate would give.

This is only true to this extent, that it does not afford materials for opening up new questions on items which were not made the subject of controversy before me.

As to all points which were taken before me, my notes will afford at least as great facilities as an ordinary chief clerk's certificate for rearguing them before the court. I think, in fact, the facilities will be found greater, as there will be less difficulty in tracing any specific matter through my notes than in hunting it down through a vast mass of affidavits.

Maclean, Q.C. and Redman, in support of the motion, argued that the defendants ought to have vouched their accounts in the way usually adopted before a chief clerk; that the official referee ought to have stated what items he had allowed, and what items he had disallowed, so that the plaintiffs might have had the same facilities for reviewing his finding with regard to any particular item, as when a chief clerk makes a certificate. They referred to

Burrard v. Calisher, 45 L. T. Rep. N. S. 793.

Romer, Q.C. and Curtis Price, for one of the defendants, contended that the official referee had taken the accounts in the only possible way uzder the circumstances.

Byrne, Q.C., Haldane, Q.C., and Sheldon for the other defendant.

Maclean, Q.C., in reply.

The following cases were also referred to:
Dunkirk Colliery Company v. Lever, 39 L. T. Rep.
N. S. 239; 9 Ch. Div. 20;

Walker v. Bunkell, 48 L. T. Rep. N. S. 618; 22 Ch.
Div. 722:

Baroness Wenlock v. River Dee Company, 57 L. T.
Rep. N. S. 320; 19 Q. B. Div. 155.

CHITTY, J. (after stating the facts, and saying that there was no charge of dishonesty against the trustees) proceeded :—It is a strong observation to make with regard to these matters, that the delay which can and does take place in some very intricate accounts almost amounts to a denial of justice. Of course, trustees ought to keep accounts, and I am not at liberty for a moment to say that these trustees, the one being a farmer and the other a cattle salesman, are exempt from the ordinary law; neither am I in a position to attempt to draw any distinction between the accounts to be kept by different kinds of trustees, because I should then have to weigh the capacity of each individual in golden scales. and say that such and such a man is one who ought to keep perfect accounts, and another should keep less perfect accounts, and others should keep none at all. It is not possible for a judge to make these varying distinctions. Those against whom it is proved that they did not keep accounts render themselves liable to be charged with moneys they have received. The remedy with regard to the non-keeping of accounts is, in a proper case, to disallow the costs of taking them, or direct the trustees to pay them. I have nothing to do with anything of that kind in the case before me. [His Lordship then read the original report of the official referee and con

tinued:] That is a short and graphic account of what took place and what these trustees did; from which it appears that, though they did not act strictly, they were doing the best they could for the family as trustees, and according to the best judgment that they could form. Then the referee goes on to give the lump sums, the result of his investigations leaving a small balance in favour of the trustees, and that is his report. Now I have a motion before me which asks me to deal with this matter strictly: first, I am asked to remit this report, with directions that these accounts be taken and vouched in the way usually adopted before a chief clerk; this part of the motion was not seriously pressed at the bar. The official referee could not take these accounts in that way; an attempt was made to do so in chambers, which failed. The official referee, in my judgment, is not bound to take accounts referred to him in the same way as the chief clerks do if this had been intended, provision would have been made by the general orders to this effect. I have referred to some of the rules, such as Order XXXIII., rr. 3, 4, and 4 a, for the purpose of showing that they are dealing only with a particular method of taking accounts before a chief clerk in chambers There is an advantage, in some instances, in taking the accounts before the official referee according to the existing practice. The official referee does not proceed by affidavit and then by crossexamination; what he can do, and what he has done in this case, is to have the witnesses before him, and the accounts, and also all the accountbooks, and then to sit continuously, as he did in this case, till the matter is finished. The parties come before him and give their evidence vivâ voce, certain accounts are produced, and evidence is taken there and then upon the matter, and there is cross-examination, of course, if need be; the referee has seen the witnesses, and has made notes, and I have a copy of the voluminous notes which were taken by him in this case. These

notes contain all the materials upon which the referee proceeded. This method of taking accounts is similar to that adopted by the masters in the Queen's Bench Division. No doubt it is not so formal or so rigid as is the manner of taking accounts in the Chancery Division, and the reason is, putting it generally, that the matter to be inquired into, and the accounts to be taken, do not stand on the same footing. On this part of the motion, therefore, I am of opinion that the official referee is not bound to take these accounts in the same way as a chief clerk does. Of course, he may adopt that method if he finds it convenient and likely to advance the ends of justice; he may have regular accounts before him, and having drawn his report referring to these accounts may say that he has allowed this item and disallowed that; but to take such an instance as the one the referee had before him in this case, with the farming account mixed up with the household account, and again mixed up with advances to the son, and having regard to the state of the family during the time to which the accounts relate, he could not properly have taken the accounts in the way adopted in chambers; and accordingly this part of the application fails. Then I am asked to give directions to the official referee to take the accounts rendered by the defendants, and filed before the date of the order

[CHAN DIV.

of reference, and state which of the items in these accounts he has allowed, and disallowed, and what, if any, sums not mentioned in such accounts he bas charged against the defendants. This part of the motion, as presented to me in argument at the bar, resolved itself into this. It is said by those who are not satisfied with the report that it is in such a form that they cannot attack it, and the force of the argument is, that the report is practically final. The referee was not directed to conclude the matter; that is to say, to try it as if it were the trial of the action and enter judgment; he is only directed under the 56th section of the Judicature Act 1873 to inquire and report, and he has made a report in such form that the plaintiffs say they cannot put their finger on anything and bring it before the court as a matter with regard to which they can say that the referee has erred. There is one observation to be made, viz., that in this report the official referee has found the total amount of receipts and the total of payments, and he has found a balance; but it is obvious from what I have said that he has not stated in the report on what accounts he has proceeded; and he has not as a fact proceeded on any particular account with specific numbers to every item. It was arranged between the parties that I should see the official referee, and thinking it would be much more satisfactory to them that I should have something in writing from him rather than a mere report of what had taken place between us, I have asked him to prepare, and have received from him, a detailed statement or second report on the particular points which had been urged before me when this motion was first opened. My suggestion to the official referee was, whether he could not go through the accounts, or rather go through the materials before him again, and point out in some way, by reference to the items or sets of items, what he had allowed or partially allowed, or disallowed or partially disallowed; but the substance of what he tells me is that he cannot do so. The official referee's additional report, which is of very considerable value, classifies the various kinds of accounts, and is as follows: [His Lordship read the further report as set out above, and continued:] There are in court what I have already referred to, viz., the notes of the official referee written out in an engrossing hand, which is perfectly legible, and which anyone can read through who wishes to do So. Now this is a peculiar case, and if I thought that the report was really in such a form that the plaintiffs could not attack it, I might have acceded to this application-reluctantly, I must admit, because such a course would probably have only led to further expense, delay, and vexation. I might, however, have been induced to send the report back, not generally, but so that the official referee might on the face of his report have pointed out generally, or specifically, as the case permitted, the items which were allowed or disallowed by reference to some document. But I think, in the circumstances of this case, it would be wrong to do this, because I am satisfied by this second report that, if there are any special grounds for attacking the report, not as a matter of form, but as a matter of substance, there are here all the materials upon which to do it. No doubt counsel would find it a very great labour to read through all the official referee's

shareholders' witnesses should be cross-examined

first.

MOTION.

This was a motion for directions to an examiner of the court as to what order ought to be pursued in the cross-examination of witnesses before him. On the 20th Dec. 1889 an application by motion was made by A. Honrich, a shareholder in the Doré Gallery Limited, under sect. 35 of the Companies Act 1862, to have the register of the company rectified by the removal of his name therefrom. The applicant asked that the witnesses who had made affidavits on behalf of the company might be cross-examined on their affidavits. The motion was accordingly directed to stand over, and an order was made that the witnesses on both sides should attend before an examiner for cross-examination if the opposite party should desire to cross-examine them.

An appointment for cross-examination was accordingly made by the examiner, to whom the matter was assigned, for Monday, the 24th Feb. 1890; and on that day the parties, their counsel, solicitors, and witnesses attended. The following report of the examiner shows what then took place before him :—

"It was contended by Mr. Terrell (counsel for the applicant), that, being in the position of plaintiff, he was entitled to have his witnesses cross-examined, if Mr. Chester (counsel for the company) desired to cross-examine them, before cross-examining the witnesses of the company, and he tendered Messrs. Honrich, Ingrey, Reydellet, and Mayhew, for cross-examination accordingly.

the

"Mr. Chester, on the other hand, contended that the adjournment of the motion and the order to cross-examine having been obtained at applicant's request, the company's witnesses should be cross-examined before the applicant's witnesses, and he tendered Messrs. Beeman, Lowles, and Ibbetson, for cross-examination accordingly.

"Both parties regarded the matter as one of principle, and desired to have it decided by the court. Under the above circumstances I adjourned the examination for the purpose of the parties obtaining the decision of the court upon it. Both counsel used other arguments upon the point, but I have not thought it necessary to state them. None of the witnesses were sworn by me."

The present motion was accordingly made for the purpose of obtaining the decision of the court on the point raised by the examiner's report.

The Rules of the Supreme Court 1883, Order XXXVII., provide as follows. By rule 21:

Evidence taken subsequently to the hearing or trial of any cause or matter shall be taken as nearly as may be as evidence taken at or with a view to a trial.

And by rule 22:

The practice with reference to the examination, crossexamination, and re-examination of witnesses at a trial, shall extend and be applicable to evidence taken in any cause or matter at any stage.

Cozens-Hardy, Q.C. and H. Terrell for A. Honrich.-The applicant is entitled to have his witnesses cross-examined first if the company intend to cross-examine them. The practice with reference to the cross-examination of witnesses before the examiner is the same as before the

[CHAN. DIV.

court. They referred to rules 21 and 22 of Order XXXVII.

Napier-Higgins, Q.C. and J. Chester for the company.-As the order to cross-examine was obtained at the applicant's request, he should cross-examine the company's witnesses first.

NORTH, J.-With respect to what took place before the examiner I read the statements contained in his report, and pay no attention to anything else. [His Lordship then read the report set out above, and continued :] Counsel for the applicant contended that the proceedings before the examiner should be commenced by the cross-examination by the respondent's counsel of the applicant's witnesses, if they were to be cross-examined at all; while the respondents' counsel, on the other hand, contended that, as the order for cross-examination had been obtained at the instance of the applicart, the respondents' witnesses ought to be cross-examined first. It was not put to the examiner that he should enter into any special arrangement for the convenience of the parties, and both parties wished to have the matter decided by the court. I think the order in which the witnesses should be cross-examined ought to be the same as if the proceedings had taken place in court. Suppose I had ordered the witnesses to be cross-examined before me in court instead of before an examiner, I should follow the usual course, and have the affidavits in chief on behalf of the applicant read first, and then the affidavits in chief on behalf of the respondents, or so much of the respondents' evidence as might be necessary for the understanding of the applicant's evidence in reply; and when the reading of the applicant's affidavits had been completed, then would be the time for cross-examining the applicant's witnesses. After that the respondents' case would be reached, and their affidavits in chief would be read more fully if the former cursory reading of them was not sufficient; and when the reading of the respondents' affidavits had been completed, then would be the time for crossexamining the respondents' witnesses. In this case the applicant's witnesses should be crossexamined first if the company wish to crossexamine them; but, on their being tendered, counsel for the respondents declined to say whether he wished to cross-examine them or not. In that I think he was wrong. But, in stating my opinion, I do not wish to lay down any rule which would debar the exercise of his discretion by the examiner in any case in which, having regard to the particular circumstances of that case, a different order may be advisable. I send the case back to the examiner with an intimation of my opinion that, under the circumstances of the case, the applicant's witnesses should be crossexamined first.

Solicitors: Kilby and Co.; Gorton.