. Legislative regulation of railway finance in England . d on theground that it would interfere seriously with the rights of the 1. Hansard, vol. 189, p. 162. 2. Hansard, V. 187, p. 1725. 3. Hansard, V. 187, p. 1722. 4. Pre-preference stocks were securities issued in escess of acompanys borrowing powers in case that company became unable tomeet its engagements with its creditors. The first instance ofthe issue of such stocks was that of the Caledonian Railway. In1851 that company obtained powers from the House of Commons toissue debentures in excess of its powers, for the purpose of payingits
. Legislative regulation of railway finance in England . d on theground that it would interfere seriously with the rights of the 1. Hansard, vol. 189, p. 162. 2. Hansard, V. 187, p. 1725. 3. Hansard, V. 187, p. 1722. 4. Pre-preference stocks were securities issued in escess of acompanys borrowing powers in case that company became unable tomeet its engagements with its creditors. The first instance ofthe issue of such stocks was that of the Caledonian Railway. In1851 that company obtained powers from the House of Commons toissue debentures in excess of its powers, for the purpose of payingits debts. At the time the company was in a state of great embar-rassment, and the course adopted proved beneficial. It was pointedout in Parliament that in that case the creation of the additionaldebentures (Pre-preference stock was not the name used) was equalto putting a charge over the preference shareholders. Hansard, , p. 1246. For further discussion of this provision in Parlia-ment, see Hansard, vols. 186-189, under Railway Companies Bill, 2 holders of the some £150,000,000 in debentures. Persons who ad-vanced money on debentures did so in the belief that they had a first clamia upon the companys receipts; but if Parliament should pre- confer the power of creating preference stocks, the public would be unwilling to advance any more money upon this class of securitie in the future, or might have never invested their money in them at all. It might be proper to permit the creation of such pre- preference stocks by special act when the particular circumstancesa warranted such procedure; but it would be impolitic to confer such 3 powers by a general act. There was also much opposition among the holders of rail-way debentures as shown by the fact that a formal protest was lod-ged against such a provision being inserted in private bills ofthe session by a large number of bankers, lawyers, as well as many prominent railwaymen, in behalf of the holders of railway deben-4
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