Legal lines: Leonard Raisbeck and the Stockton & Darlington Railway

The Leonard Raisbeck Archive offers insight into his association with the Stockton & Darlington Railway (S&DR), from promoting the railway at its inception to becoming one of the company’s solicitors and representing the interests of Stockton. This blog post places some of the material in the Raisbeck archive into context, presents some of the wider legal aspects that came with establishing a railway company, and provides a behind-the-scenes look at the sometimes-difficult relationships between some of the railway’s key protagonists.

Canal or railway?

It was not inevitable that a railway would be built to link Stockton with the coalfields, and the Raisbeck archive gives insight into this. Earlier schemes to connect the inland collieries of south-west Durham with the River Tees centred upon the construction of a canal. However, on 18 September 1810, Leonard Raisbeck, solicitor for the Tees Navigation Company and Recorder of Stockton, opened the door to a possible rail connection at a dinner celebrating the opening of a new cut to shorten river navigation on the Tees. The archive shows that two principal resolutions emerged that day:

‘…that a Canal or Railway for the conveyance of merchandise between Stockton and the interior country will be of considerable advantage to that port and to the several towns or places connected with it in a commercial point of view.’

The second resolved that: ‘A committee be appointed for obtaining the requisite Information on the subject…’, and would include several luminaries who would be closely associated with the emergence of the S&DR.

Indecision about which scheme to pursue would continue for some years, not helped by John Rennie, the engineer the Committee approached to undertake a new survey following a public meeting at the King’s Head in Darlington on 17 January 1812.[1] A letter received from Rennie on 25 January notes his fee was £7 7s per day, while another from 12 July reveals a heavy workload, but that he was reviewing the earlier canal schemes. Officially appointed surveyor by the Committee in September 1812, he had not completed his work by May the following year, attracting the Committee’s displeasure. Furthermore, a letter written by Raisbeck in October 1813 indicates that Rennie’s ‘…sentiments as to the relative advantages & the probable difference of expence of a Canal v Railway’ were unknown, and that the full facts were needed by the Committee,‘ particularly as it is known a Railway has its advocates’.

A response from Rennie in April 1814 explains that a new survey would be needed for a railway, and estimates would be supplied. Although these are not included in Raisbeck’s papers, another document notes that a railway between Stockton and Darlington could be built for £59,002 as opposed to £95,600 for a canal. Nevertheless, it was anticipated that ‘…the Tonnage to be conveyed will [increase] so considerably as to require a double Railway which Mr. Rennie is of opinion will cost as much as a canal & it has therefore been determined to prefer the latter.’ Consequently, it seemed as though a canal would be built, though the poor financial conditions that followed the Napoleonic Wars ensured the scheme stalled, and that it would be 1818 before further action was taken, by which time there were particularly divergent views favouring a canal or railway.[2]

Stockton merchant Christopher Tennant fronted a scheme for a canal direct from Stockton to the collieries that avoided Darlington and Yarm; this prompted the formation of a rival railway-based scheme that would pass through Darlington and connect with Yarm.[3] The proposal, led by several prominent local Quakers including Edward Pease, a Darlington-based woollen manufacturer, and banker Jonathan Backhouse, saw the appointment of Raisbeck and Francis Mewburn as joint solicitors, and Welsh engineer George Overton to survey the route of the railway.

At a meeting of canal project subscribers held at Stockton on 15 December, it was explained that the required level of subscriptions had not been met, and it was suggested that ‘…it appears desirable to ascertain whether a Rail-road … should not be substituted for a canal’, and that ‘preliminary steps necessary to obtaining an Act of Parliament be immediately taken’; Tennant was nevertheless opposed to the Darlington scheme, laying the foundations for the future Clarence Railway, which would compete for coal traffic.[4] Though the Raisbeck archive sheds light on the decision to adopt rail technology, there is little detail of his involvement with the S&DR’s failed 1819 bill and successful 1821 and 1823 bills while they progressed through Parliament. However, it is known that he was a member of the deputation in London and a joint sponsor of the subsequent 1823 bill with Mewburn, which gave statutory authority for the use of steam locomotion and the carriage of passengers, as well as some route modifications.[5] The following paragraphs give a flavour of the task of setting up a railway company.

Submitting a Private Bill: Joint stock company status and incorporation

Early waggonways and plateways were often financed by private individuals or partnerships, examples being John Blackett’s tramway at Wylam, c1748, and the three iron masters who agreed to make financial contributions towards the construction of the Merthyr Tramroad in South Wales between 1800-1802.[6] Financial liability for these ventures rested solely with the owners concerned, and land access was usually secured through negotiation.[7] However, such undertakings often remained small in scope. Creating a comprehensive, long distance transport system serving a range of interests required much more, the cost being beyond the means of a few wealthy individuals.  Capital needed to be raised from a much wider base—the public. The vehicle for achieving this was the joint stock company, defined as a business owned by people who have bought shares in the company.[8] This method of raising capital was a characteristic of transport enterprises such as canals and turnpike roads, and was the model used by the S&DR.

Both Mewburn and Raisbeck would have understood Parliamentary Standing Orders—the rules and procedures of business and committees in both Houses of Parliament—and smoothing out the legal impediments to the company’s establishment. Obtaining joint stock company status to raise shareholder capital normally required a Royal Charter, the issuing of which had been closely controlled by Parliament since the 17th century. Another route was incorporation by Parliamentary statute, and transport enterprises, being capital-intensive projects of public as well as private benefit, were eligible for incorporation by this means.[9]

Incorporation meant a company would have its own separate legal identity that could exist in perpetuity.[10] Obtaining this was important; firstly, it formalised a separation between a company’s legal identity and its ownership, meaning that shareholders were free to sell their shares without affecting the everyday business of the company. Secondly, it gave the company the statutory authority to undertake its business under the terms and privileges set out in its private act. Examples include the railway company setting byelaws, purchasing and owning land, and in some cases defending itself against litigation taken against it, such as for allegations of ‘public nuisance’ when reasonably carrying out its business. In this regard, the 1823 act would prove crucial in a landmark case heard in 1832, R v Pease.[11] This defended the railway’s statutory authority to use steam locomotives, which were alleged to frighten horses, on grounds of there being greater public benefit than inconvenience from nuisance.

To achieve incorporation, prospective canal, turnpike and railway projects prepared and submitted private bills to Parliament. These were a request to transfer powers from the public to individuals or bodies; in the case of canal, road and railway construction, this encompassed the granting of land acquisition rights and the right to issue tolls or act as carriers.[12] Consequently surveys, articles of association and lists of subscribers who had paid deposits for their share allocation were submitted as part of the process; indeed, under Parliamentary standing orders, subscriptions for four-fifths of the total share capital had to be achieved for a bill to pass to the next stage.[13]

Achieving this was a close-run thing for the S&DR; subscribers to the stalled canal project were not necessarily willing to financially support the enterprise, and Raisbeck courted further substantial financial support from Pease and the wider Quaker financial network to ensure the bill could proceed.[14] The preparation of the various components of the private bill was overseen by a provisional committee of railway promoters and included the solicitors.[15] Once submitted to Parliament, the granting or rejection of the bill was contingent upon balancing the interests of the promoters, those businesses and landowners directly affected and the public in general.[16]

Dealing with opposition

Submitting a private bill was by no means the end of the process, and negotiation and compromise was essential. The S&DR’s first bill was submitted in 1819 but was thrown out because the proposed route required the compulsory acquisition of land belonging to the Lords Darlington and Eldon. Eldon, who was Lord Chancellor, queried why the railway required rights of compulsory land acquisition when wayleaves had sufficed elsewhere in the North East, possibly considering the potential loss of income from such wayleaves.[17] This was untenable for a line the length of the proposed S&DR; land ownership by the company was clearly the best way to settle the issue for the long term.

The Raisbeck material includes a progress update from Thomas Meynell, chairman of the company since 1818, published for subscribers in 1820 to explain that:

‘Your Committee may also add, that no care has been wanting on their part to conciliate those who have hitherto opposed their efforts, and cautiously to avoid those injuries to private property which might be likely to arise in carrying into execution a work so extensive, and so replete with public good.’

The work undertaken to placate opposition is merely implied, and the statement glosses over the time and expense of adapting plans. For the second bill, Lord Eldon’s objection was addressed through financial compensation, while a route alteration was made to avoid Lord Darlington’s land.[18] Although delayed by the death of King George IV, it was submitted in 1821 and was passed by Parliament.

A ’public railway’

The S&DR was established as a ‘public railway’. This may be defined as a line built and owned for the purpose of allowing independent users access in return for a toll, once again emulating turnpikes.[19] The earliest known example of a public railway is the Lake Lock Railroad near Wakefield, established in 1798.[20] Other early public railways include the Surrey Iron Railway, which was authorised by Act of Parliament in 1801. Railways such as these were often infrastructure owners that either waived or franchised-out their rights to operate services. The S&DR would do this after 1825; what passenger services were initially provided on the predominantly mineral line were horse-drawn, and the railway only ran them for a year before contracting-out to a private individual. This arrangement lasted until 1833 when line congestion forced a rethink and the service was taken in-house by the S&DR.[21] In contrast, the Liverpool & Manchester Railway provided services both on its own account and allowed other owners of suitable locomotives and rolling stock to access its line for a toll.

A parting of the ways

A particular strength of the archive is the material concerning the S&DR’s proposed extension to Middlesbrough. Work to progress effort on the extension was sanctioned by the board in October 1827, with Raisbeck involved with the preparations for a new private bill. However, Raisbeck’s other business interest, the Tees Navigation Company, had struggled to finance improved access to the port at Stockton, restricting the flow of goods such as coal, while it could levy charges on every vessel using the port. By the beginning of 1828, it was in the process of drafting a new bill in a fresh attempt to improve river access to Stockton.

Writing on 2 January 1828 in advance of an S&DR board meeting, Pease reminded Raisbeck of his conflict of interest, that ‘there is amongst our subscribers a fear that it will be most difficult for thee to have in interest in the conducting of the Tees navigation extension; & RWay extension’.

William Tomlinson, in his history of the North Eastern Railway, noted that the Tees Navigation Company held a ‘…melancholy vision of deserted quays and wharves and a consequent loss of dues.’[22] This was because the establishment of a new port at Middlesbrough as a result of the railway extension would compete with Stockton, having the advantage of accommodating larger ships. In the 2 January letter to Raisbeck, Pease addressed opposition along the following lines:

‘…the Railway has done a good deal for the town, whilst it has done nothing for itself; & if they will remain quiet, it will do a great deal more for it yet than ever it has done; & if it is not quiet, the rail way Co will hold a steady march to the attainment of their object without looking to right or left…’.

In the event, not ‘looking to right or left’ was precisely what happened at an S&DR board meeting discussing the Tees Navigation Company proposals on 5 January 1828. The Darlington-based directors, led by Pease and Jonathan Backhouse, successfully obtained a resolution to pursue the branch to Middlesbrough without delay.[23] Raisbeck dissented along with Meynell, the chairman; Tomlinson wrote about Raisbeck’s concern that the new branch would harm the interests of Stockton and of many of his associates.[24] Mounting tension can be detected in Pease’s letter of 25 January, which details a trail of hearsay suggesting that Raisbeck was heard ‘…to say that the town was completely against the scheme’ and that Lord Harewood, who owned land on the south side of the Tees, be advised to oppose the railway extension.

On 17 March Pease’s son, Joseph, responded to Raisbeck’s notice of resignation, itself drafted on 14 March, and poses the question of whether he was justified in ‘…deserting his Clients in the hour of perplexity and danger’, with the extension bill still in Parliament.

Responding on 19 March, Raisbeck explained the difficulties he was facing: ‘You may remember my notising at a Gen’l Meet’g of the RW propr’s [proprietors] in Jan’y last & the possib’y of my having to advocate conflicting Int’s [interests] on being sol’r [solicitor] for two of the bills proposed’, making the decision to step down from the railway company as a result.  Summoned to give evidence for the railway bill on 9 May, Raisbeck left his post that month; he would nevertheless continue his association with the S&DR as a shareholder.

Conclusion

As can be seen, the process of achieving company status and obtaining authorisation for line extensions was bureaucratic and required the attention of experienced legal experts to navigate the potential pitfalls. However, the Leonard Raisbeck Archive has the additional dimension of shedding light upon the relationships between the various individuals involved with the S&DR, as well as the conflict of interest in which he found himself.

[1] See: W. Tomlinson, North Eastern Railway: Its Rise and Development (London: Longman, 1914), 40.

[2] Tomlinson, North Eastern Railway: Its Rise and Development, 53.

[3] M. W. Kirby, “Quakerism, Entrepreneurship and the Family Firm” in Entrepreneurship, Networks and Modern Business, ed. J. Brown and M. B. Rose (Manchester: Manchester University Press, 1993), pp. 111-112.

[4] Kirby, “Quakerism, Entrepreneurship and the Family Firm”,

[5] Tomlinson, North Eastern Railway: Its Rise and Development, 85; Kirby, “Quakerism, Entrepreneurship and the Family Firm”, 112.

[6] P. Ireland, “Limited liability, shareholder rights and corporate irresponsibility,” Cambridge Journal of Economics, 34 (2010), 839.

[7] R. Harris, Industializing English Law: Entrepreneurship and Business Legislation, 1720-1844 (Cambridge: Cambridge University Press, 2000), 21.

[8] Cambridge Dictionary, “Meaning of joint-stock company in English”, accessed 10 May 2021. https://dictionary.cambridge.org/dictionary/english/joint-stock-company

[9] Ireland, “Limited liability, shareholder rights and corporate irresponsibility,” 839.

[10] Harris, Industializing English Law, 18.

[11] See: M. Wilde and C. Smith, “R v Pease (1832)” in Landmark Cases in the Law of Tort, ed. C. and P. Mitchell (Oxford: Hart Publishing, 2010), pp. 1-32.

[12] “Roads and Railways: Private Acts”, UK Parliament, accessed 3 May 2022.  https://www.parliament.uk/about/living-heritage/transformingsociety/transportcomms/roadsrail/overview/privateacts/

[13] M. W. Kirby, The Origins of Railway Enterprise: The Stockton & Darlington Railway, 1821-1863, pp. 36-37.

[14] Kirby, The Origins of Railway Enterprise, 37; Kirby, “Quakerism, Entrepreneurship and the Family Firm”, 112.

[15] H. Pollins, Britain’s Railways: An Industrial History (Newton Abbot: David & Charles, 1971), pp. 24-25.

[16] A. Dawson, The Liverpool and Manchester Railway: An Operating History (Barnsley: Pen & Sword, 2020), pp. 10-11.

[17] Kirby, The Origins of Railway Enterprise, 35; “Scott, Sir John (1751-1838).”  Accessed 13 August 2018.  http://www.historyofparliamentonline.org/volume/1790-1820/member/scott-sir-john-1751-1838.

[18] Kirby, The Origins of Railway Enterprise, 36.

[19] D. Bayliss, “Was the Surrey Iron Railway the First Public Railway?”, Bulletin of the Croydon Natural History & Scientific Society, No. 102 (March 1997), pp. 2-3.

[20] Dawson, The Liverpool and Manchester Railway, 10.

[21] Kirby, The Origins of Railway Enterprise, 4, 102; Dawson, The Liverpool and Manchester Railway, 18.

[22] Tomlinson, North Eastern Railway, 168.

[23] Tomlinson, North Eastern Railway, 169.

[24] Tomlinson, North Eastern Railway, 169, 171.