The Saints’ Way: a failed mission Ffordd y Saint
The Old and the New.
Ex-SAR NGG16 Garratt No 87 (built 1936) and ex-NWNGR Hunslet 2-6-2T Russell (built 1906) stand side-by-side at Dinas Junction.
The was taken on Saturday July 30th 2022 during the WHR 100 celebrations at Dinas.
Paul Andrew Stock
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Foreword
The Welsh Highland Railway, one of the world’s most iconic narrow gauge lines celebrated its 100th anniversaries in 2022 and 2023 namely the re-opening of the old North Wales Narrow Gauge Railways Company’s route from Dinas to Rhyd Ddu in 1922 and the completion of the route via Beddgelert to Porthmadog in 1923. The Ffestiniog & Welsh Highland Railways, ‘Cymdeithas Rheilffordd Eryri’, the Welsh Highland Railway Heritage Group and the Welsh Highland Heritage Railway worked together to organise a very comprehensive and successful programme of special trains and events in both years. In addition , the organisers arranged a research competition for the best piece of original research on the history and background of the WHR and its predecessor, the North Wales Narrow Gauge Railways Company. The contest, carried a prize of £500 and was sponsored by Mortons Media (publisher of Heritage Railway and its sister title The Railway Magazine. It is noteworthy that both publications have over many years, played an important role in reporting on the story of the Welsh Highland and its predecessors.
A final list of three entries was selected by the two judges, Dr Dafydd Gwyn, who advised Gwynedd Council on its successful bid for UNESCO World Heritage status for the slate landscape of North West Wales, and Gareth Haulfryn Williams, a former county archivist of Merioneth and who retired as head of culture for Gwynedd Council in 2003. Both are Welsh speakers and are very much involved with various aspects of both the WHR and the Festiniog Railway. All three essays had their merits and were of a very high standard, and the judges faced a challenging task choosing a winner. However, after lengthy consideration, the two eminent historians selected Stephen Murfitt’s submission titled The Saints’ Way: A failed mission – Ffordd y Saint. We are pleased to publish Stephen’s excellent monograph as part of the WHR Heritage Group’s programme of researching and recording all relevant aspects of the railway’s history, both ancient and modern.
Nick Booker Chairman - The Welsh Highland Railway Heritage Group August 2023
About the Author
Dr Stephen Murfitt is a lawyer with a particular interest in the early railways. Now semi-retired he was formerly Chair of the Board and Senior Partner of a national firm of solicitors. He has presented papers at International Early Railway Conferences and in 2017 was awarded a PhD from the University of York for his thesis ‘The English Patent System and Early Railway Technology 1800–1852.’ In 2023 he published Festiniog Law offering a novel perspective on the Ffestiniog Railway’s history and demonstrating the considerable influence of the law and its institutions on the shaping of the Festiniog Railway Company. Stephen is a non-executive company director and a charity trustee of standard gauge railway organisations and has been involved with the narrow gauge Ffestiniog Railway for many years, commencing as a volunteer locomotive fireman. Since 1994 he has been honorary solicitor and clerk to the Festiniog Railway Company, and since 2006 a statutory director.
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Background
The Welsh Highland Railway (WHR), Britain’s longest heritage railway, celebrated its incorporation as the Welsh Highland Railway (Light Railway) Company (WHLR) 1 in 2022. The railway has had a chequered history characterised by stewardship under the auspices of a significant number of individuals, many of whom for extensive periods of time were supervised by the High Court of Justice. The WHR between Porthmadog and Dinas opened on 1 June 1923 and was immediately embroiled in financial crisis, circumstances that were to become a hallmark of the early WHR. The railway was the first of only two slate-carrying narrow gauge railways to be completed between the two world wars. 2 Following the cessation of WWI, local authorities were encouraged to invest in light railways and in 1914 a joint decision by local authorities eventually led to the incorporation of the WHLR. 3 With substantial borrowings from the outset, but insufficient income to pay the interest, the early WHR was never going to be a profitable undertaking. Although the railway ultimately closed in 1937, the company had entered a period of receivership as early as 4th March 1927. This, together with a further period of liquidation which did not conclude until 14th February 1999, resulted in WHLR remaining under High Court supervision for a period of seventy-two years. A significant period in the life of a centenarian company, particularly as it was generally subject to the day-to-day control of those who would not have had restoration and or preservation of the railway as a priority.
The seventy-two year period of management by essentially non-railway enthusiasts, raises the question why WHR has survived as a railway rather than, as many would have aspired, as a long-distance footpath? To celebrate properly the anniversary of the WHR it is instructive to understand some of the events that occurred during those seventy-two years; the disputes, decisions by receivers, liquidators, supervising judges and the relevant local authorities. This paper seeks to examine and explore the WHR’s journey during those years, and why many powerful national organisations, including the National Parks Commission, the Ramblers Association and the Council for the Protection of Rural Wales, sought the creation of a long-distance footpath along its route, failed in their mission. The case presented here highlights that it was poor legal advice, haphazard and dormant decision-making together with the wisdom of a High Court judge very late in the day when a footpath seemed to be a reality, that served to preserve the railway that is celebrated today.
A consideration of some of the events during this lengthy period of seventy-two years, demonstrates that whilst the local authorities (known as the investing authorities) were initially committed to the success of the WHR as a railway, they soon became disillusioned with the mounting operational problems, the shortage of cash and the long-running multiple and complex disputes between WHLR and other parties. Although denied during later public inquiries, 4 there was a relatively early intention on the part of the investing authorities and the liquidator to convert the WHR track bed into a footpath; an intention heavily fostered and encouraged by national organisations whose constitutions encouraged the creation of footpaths. In a final submission on behalf of the Festiniog Railway Company (FRC) to the Light Railway Inquiry held in November 1993, Jeremy Sullivan QC 5 argued that Gwynedd County Council’s (GCC) intention in seeking control of WHR was to create a footpath rather than to restore a railway. Arguing that GCC’s case was ultra vires, he
1 Welsh Highland Railway (Light Railway) Order 1922, No. 432.
2 Gwyn, D., Welsh Slate: Archaeology and History of an Industry, (2015), 238.
3 Johnson, P., Rebuilding the Welsh Highland Railway (2018), 13.
4 Hopkins, J., Rheilffordd Eryri The Welsh Highland Railway Recent History 1991-2000 (2000), 63.
5 Jeremy Sullivan was appointed High Court Judge in 1997 and in 2009 was elevated to the Court of Appeal. He was appointed President of Tribunals in 2012 and retired from the Court of Appeal in 2015.
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told the Inspector:
‘An interpretation of these documents by anyone other than Humpty Dumpty shows that the Council wished to purchase the track bed for National Park purposes as a footpath.’6
Analysis of local authority involvement over the seventy-two year period establishes that Jeremy Sullivan QC was entirely correct. During the receivership and liquidation, a number of mistakes were made which did not aid the investing authorities in their pursuit of a footpath, and doubtless contributed towards the preservation of the railway remaining a live issue. The concept and applicability of railway abandonment powers, indemnity insurance and the question of whether the liquidator’s consent was required for certain actions were all misunderstood and led to incredible delays. Receivers and liquidators are officers of the High Court and as such are subject to the court’s supervisory jurisdiction. This too was misunderstood at times. Receivership and liquidation are generally short-term measures intended to protect a company whilst plans are perfected for the sale or dissolution of the company. The supervision by the High Court of WHLR over a protracted period of seventy-two years is open to criticism and is a contributing factor to the problems faced by the investing authorities in their pursuit of the creation of a long-distance footpath.
History of the Railway
WHLR was promoted by Caernarvonshire County Council together with other local authorities and was incorporated on 30th March 1922. The Welsh Highland Railway (Light Railway) Order 1922 provided for the acquisition of the North Wales Narrow Gauge Railways Company and the Porthmadog, Beddgelert & South Snowdon Railway Company 7 The issued capital was initially £90,000, and key to an examination of this period are the investing authorities who were granted debentures under section 31 of the 1922 Order in the following sums,
Caernarvonshire County Council £15,000
Caernarvon Urban District Council £ 5,000
Portmadoc Urban District Council £ 5,000
Gwyrfai Rural District Council £ 3,000
Deudraeth Rural District Council £ 3,000
Glaslyn Rural District Council £ 3,000 (abolished in 1934, debenture transferred to Gwyrfai)
In addition, there were the following further debentures, Ministry of Transport £35,773
W. H. McAlpine £10,000
Branch Nominees Limited £10,000
The year 1923 may have been the most profitable for the WHR, but thereafter disputes and poor financial performance were the order of the day. From the outset the investing authorities were nervous participants, perhaps with good reason. The WHR was beset with disputes many of which were caused by the Company’s poor financial position. In April 1923 WHLR acquired land at Beddgelert from Tourists Hotels
6 Beyond the powers.
7 A summary prepared by H.P Naunton, Official Receiver, 23rd June 1944: Welsh Highland Railway (Light Railway) Company: Judge's Copy Petition, J13/17749/27, National Archives, Kew.
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Hotels (then owners of the present Goat Hotel) for £687. WHLR covenanted to build an approach road ‘connecting road and bridge from the road from Caernarvon to Betws-y-Coed over the River Colwyn to the railway station at Beddgelert and a footpath from the Royal Goat Hotel to the said station’. 8 Despite architects R. D. Jones of Pwllheli being instructed to prepare plans (see Appendix 1) 9, WHLR could not find the funds to pay for the road.
Tourist Hotels commenced the first of many court actions against the WHLR on the basis of breach of contract. The court granted judgement on 11th December 1925 in favour of Tourist Hotels and ordered a judicial inquiry to establish the amount WHLR should pay by way of compensation (damages).
Tourist Hotels contracted for the new road (coloured yellow on the appended plan) in the belief that the surrounding land which they owned (coloured pink on the appended plan) would be developed to their financial benefit. Colonel Stephens and Evan Davies filed affidavits on behalf of WHLR 10 arguing that only five houses had been constructed in Beddgelert during the previous seven years and there was no demand for further building. Mr Justice Clauson eventually decided that the sum of £1,000 was due from WHLR to Tourist Hotels and made a court order accordingly. A sum that WHLR could not afford to pay.
It is not known whether the sum was paid, or enforcement proceedings were commenced against WHLR, but it may have been this dispute that caused Caernarvonshire County Council to decide that it had to take some positive action to protect its debenture. Tourist Hotels obtained judgement on 10th February 1927, and on 4th March 1927 the High Court granted Caernarvonshire County Council the appointment of a receiver and manager in respect of WHLR. It is of some importance to be clear regarding the role of a receiver and manager because WHLR was subsequently subject to such management for seventeen years until 1944. A secured creditor (the investing authorities were all debenture holders and as such were secured creditors) could apply to the High Court for the appointment of a receiver and manager, essentially an officer of the court, who would manage the company and receive the income. Acting as the managing agent, the receiver and manager carries on the business of the company.
In Re B. Johnson & Co. (Builders) Ltd. (1955),11 Jenkins LJ explained that the receiver’s primary duty is to the debenture holder. As receiver and manager of a company’s property for the debenture holder ‘the whole purpose of the receiver and manager’s appointment would be stultified if the company could claim that a receiver and manager owes it any duty comparable to the duty owed to a company by its own directors and managers.’ The receiver also owes duties to the creditors and is supervised by the courts. 12 On 23rd March 1927, J. R. Maxwell, barrister, advised the County Council:
‘The Receiver and Manager when appointed will be an officer of the court and must look to the assets under the control of the court to satisfy any liabilities undertaken by him in respect of Receivership. Consequently, Caernarvonshire County Council will not be responsible for such liabilities undertaken: per Warrington J in Bochen v Goodall (1911).’ 13
8 Statement of Claim in the High Court Proceedings, 16th July 1925. T.D. Jones, London (Solicitors)
Records: Welsh Highland Railway: Receivership, legal documents, 9/23 Box 1, National Library of Wales, Aberystwyth.
9 ‘Plan - Land available for building at Beddgelert,’ R.D. Jones, Architects, T.D. Jones 9/23 Box 1.
10 T. D. Jones, 9/23 Box 1.
11 Re B. Johnson & Co. (Builders) Ltd. [1955] Ch. 634.
12 The Enterprise Act 2002 curtailed the ability to appoint receivers.
13 T. D. Jones, 9/23, Box 2.
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Receivers and Managers
An examination of the papers of solicitors who acted for the various parties establishes a very clear pattern of the receiver and manager applying to the High Court for directions. The High Court appoints judges known as Masters who take on responsibility for particular companies. They become very familiar with the conduct of the receivership and any substantial issues are transferred to a High Court judge for a decision. The receiver is required to make regular reports to the Master (including seeking permission for payment of their fees) who on occasions will summon the parties to their chambers to ask, for example, why a particular report is late. 14 Receivership was designed to be a short-term measure to protect creditors interim whilst it is ascertained whether the company is a going concern.
Colonel Stephens was appointed the first receiver and manager of WHLR. His appointment was renewed periodically by the court until he died of coronary thrombosis, aged sixty-five years, on 23rd October 1931 at the Lord Warden Hotel in Dover. On 15th March 1927 Colonel Stephens filed an affidavit setting out the parlous financial state of WHLR. In respect of the year to December 1926 the revenue amounted to £4,097 2s 7d of which £4,000 was goods and passenger traffic income. He collected rents of£65perannum. Asidefromthedebentureclaimstherewereotherstotallingapproximately £90,000. It is clear from these figures that the prospects of the WHLR becoming a going concern were slim. It is therefore interesting that the relevant parties continued with the receivership for so long, even more so that the High Court allowed them to do so.
Colonel Stephens had to deal with a number of continuing disputes, 15 a reason he cited when having to explain why the receivership had become so protracted. The Treasury Solicitor on behalf of the Ministry of Transport became particularly agitated by the slow progress. A dispute with the Great Western Railway (GWR) took up much of Colonel Stephens’ time. GWR had issued court proceedings against WHLR for the cost of operating the Croesor crossing, including staffing costs, telephone and signalling costs in the initial sum of £888 16s 6d. In a defence filed on 27th October 1930, WHLR stated:
‘The said works were erected many years ago solely for the benefit of the GWR or their predecessors the Cambrian Railways to protect that railway from the mineral trains of the company’s predecessors.’ 16
Colonel Stephens saw no merit in GWR’s argument that WHLR had occasional use of the crossing and despite offers and counter offers, no settlement was reached. It was common ground that in June 1923 GWR made thirty-eight crossings per day, compared with eighteen by WHLR. The dispute was listed for hearing before the Master on numerous occasions and although at a hearing in November 1928 he expressed sympathy for GWR, he made no judgement. In the author’s opinion this is an example of poor supervision by the courts. Furthermore, the cost of countless hearings must have diminished yet further the scarce assets of WHLR. The long running dispute came to an end as late as 1938 when GWR finally recognised that even if it won, enforcement would be difficult if not impossible. GWR agreed to withdraw its claim (by now £1,746 9s 2d) on condition that GWR had legal title to the crossing and that their lien 17 on materials at the crossing was a valid one.
14 Welsh Highland Railway (Light Railway) Company: delay by liquidator to furnish record book: BT325/5, National Archives, Kew.
15 T. D. Jones, 9/23, Box 4.
16 T. D. Jones, 9/23, Box 3.
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Following the death of Colonel Stephens one of his executors and former partner, J. A. Iggulden, was appointed receiver from October 1931 until April 1932. Almost his first task was to deal with a summons issued by the Hunslet Engine Company asking the court to order that the receiver should direct payment to them of an outstanding invoice in the sum of £28 8s 2d. The Master adjourned the summons generally, the effect of which was yet again to make no decision. No doubt the Master was concerned to avoid opening the flood gates for claims against WHLR which it could not pay. The Master did however issue an important warning, namely that in his view WHLR could not continue to be run at a loss, 18 a warning that was neither heeded nor enforced by the courts. It is perhaps surprising that the courts did not take a more robust approach in the exercise of their supervisory Powers. Had they done so, it is doubtful whether the present centenary celebrations would be taking place.
On 12th April 1932, Richard Thomas Griffith was appointed by the court as receiver and manager. He was the clerk to Gwyrfai Rural District Council, one of the debenture holders. Griffith inherited the same problems as his predecessors and on 7th October 1933 wrote to David Jones, clerk to Caernarvonshire County Council in the following terms:
‘My view of the matter is that if I am being served with a summons by the people to whom the Welsh Highland Railway is indebted and for debts which were incurred prior to my appointment, the position of the railway is such that I can never meet them. All that I can do at the moment is to keep the concern going without getting an overdraft at the bank.’ 19
This early erroneous view expressed by Griffith regarding the conduct of the receivership only adds weight to the argument that the creditors were entitled to more positive action on his part and that of the courts. Griffith may have been hoping that the company would generate more income allowing him to discharge some of the debts. In October 1933, he reported increasing traffic figures. 20
However, and not surprisingly, the debenture holders were restless. On 22nd November 1933 during a meeting held at the Ministry of Transport in London, it was agreed to approach Caernarvonshire Crown Slate Quarries Limited in the hope that they could be persuaded to use the railway for the transportation of their slate. Should this request be rejected, the debenture holders concluded that they would have to take steps to close the railway. 21 In the event these efforts were unsuccessful, and the railway closed in January 1934.
Festiniog Railway Company Lease.
In May 1934 there was a surprising offer from the Festiniog Railway Company (FRC) to take a lease of the WHR on terms that were not in the FR’s interests: a lease for forty-two years with a break clause at the end of the first year and rent at ten per cent of the gross receipts. 22 On 31st May 1934 a special meeting was held at the Council Chambers Caernarvon [Caernarfon] when all interested parties were present. The investing 18 T. D. Jones, 9/23, Box 4. 19
D. Jones, 9/23, Box 4. 20
D. Jones, 9/23, Box 4. 21
22 Welsh Highland Light Railway: lease to Festiniog Railway Co: MT 47/407, National Archives, Kew.
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T.
T.
T. D. Jones, 9/23, Box 3.
Year Passengers Fares 1932 3232 £256 0s. 1d. 1933 6445 £484 2s. 0d.
authorities were concerned as to the maintenance of WHR bridges. The representative for the Minister of Transport was recorded in the minutes as stating, ‘the difficulty could be overcome by the County Council accepting liability for the bridges, the expenditure so incurred on Class 1 and Class 2 Roads being eligible for a grant by the Ministry’. 23
Following further discussion, the Council resolved:
IT WAS RESOLVED to adopt the foregoing report, and to approve the granting of the lease to the Festiniog Railway Company upon the above-mentioned terms, and that the seal of the Council be affixed to such lease.
IT WAS ALSO RESOLVED that this Council should accept transfer of the liability for the bridges and to be responsible for their future maintenance.
[The minute was signed by Alderman Henry Hughes, Chairman of the Council.]
The Council appears to have accepted liability for the maintenance of the bridges on the basis that they could reclaim the money from the Ministry of Transport. This resolution became important in later years when there were competing claims for the WHR, and it remains important to this day. Although the discussion mentioned Class 1 and Class 2 roads those restrictions formed no part of the formal resolution. This has led to present day discussions with Gwynedd Council (GC) concerning the liability of non-Class 1 and Class 2 roads that cross the WHR. It seems clear to the author that GC’s liability cannot be restricted to Class 1 and Class 2 roads since they form no part of the terms of the Council’s formal resolution of 1934.
On 12th June 1934, Mr Justice Bennett approved the grant of the lease to FRC making an order that Griffith be discharged as manager but remain as receiver. George Gregory Williams who replaced Griffith as receiver on 8th February 1939, remained in post until 12th December 1944.
As is well known FRC was unable to improve the performance of WHLR and in 1937 FRC asked to be released from the lease. The investing authorities agreed on terms that FRC would make a payment of £600 in two instalments and retain the steam locomotive Moel Tryfan that was in a dismantled state in Boston Lodge Works. The agreement was completed by Williams and WHLR and application made to the High Court for approval. On 3rd November 1942, Mr Justice Simonds made an order in the terms of the agreement.24 In the meantime, the investing authorities consented to a requisition order from the Ministry of Supply and, in support of the war effort, the rails and equipment of WHLR were sold to scrap merchants George Cohen and Co.
The Liquidator is appointed
The WHLR was now shorn of its rails and much of its infrastructure. Some seventeen years of receivership had not achieved a great deal for any party. The debenture holders and numerous creditors had not been paid and there seemed little hope of the WHR track bed returning to an operating railway. The WHR was at its lowest ebb, and it was inevitable that steps would now be taken to action the last rites. This is perhaps unsurprising. The company had been in substantial debt from the beginning
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23
Caernarvonshire County Council Official Minutes, March 1934 to March 1934, Gwynedd Archives, Caernarfon Record Office. 24 T. D. Jones, 9/23, Box 1
and the outstanding liabilities were never going to be serviced by a railway which at the time had little passenger or goods traffic.
The petition for winding up WHLR filed in the High Court sets out the sorry detail. It was issued in January 1944 by Caernarvonshire County Council who correctly pleaded ‘the company has never been able to work its light railway at a profit’. The Council claimed their debenture sum of £15,000, plus outstanding interest, and the sum of £630 2s. 9d. for bridge repairs. (It is not clear why these sums for bridge repairs had not been claimed from the Ministry of Transport; or had the Ministry refused payment?) Details of the other debenture holders and outstanding interest were set out. The listed assets comprised the sum of £550 owed from the FRC, and £12,800 from the Ministry of Supply in respect of the requisitioning of rails etc. together with ‘the land on which the track was laid and the buildings.’ 25
On 2nd February 1944 the investing authorities resolved that Mr Alwynne Aubrey Thomas be appointed liquidator at a creditors’ meeting to be held on 10th March 1944. 26 In accordance with usual practice, at the meeting on 10th March 1944 a committee of inspection was also appointed from among the creditors to advise and superintend the liquidator. Mr Thomas, an accountant who practiced in Llandudno, was duly appointed by the High Court. 27 The liquidator takes over the directors’ powers and assumes authority for causing a company to act. The functions of a liquidator are to collect in and realise the company’s assets and to distribute them to the company’s creditors in an order of preference. Crucially, the liquidator can carry on the business so far as it is beneficial for the winding up. Generally, liquidation is seen as a relatively short-term process. Mr Thomas took over a company with no continuing business and although the restoration of a heritage railway could not have been in his mind initially, he soon came to realise that a railway company with statutory powers presented a number of complex problems to the realisation of that company’s assets.
It is curious that the investing authorities did not take matters more into their own hands. Receivership had clearly not achieved any satisfactory resolution, either for the railway company or the investingauthorities. The latter were not ultimately interested in restoring the railway and by appointing a liquidator they inadvertently committed themselves to a process that would last from 2nd February 1944 until 4th February 1999, when the Official Receiver finally transferred WHLR to FRC for £1. 28 A staggeringly lengthy period of fifty-five years. Although hindsight is a great advantage it is very difficult to justify a liquidation that lasted so long and was tolerated by the High Court. However, it is probably the reason why we are able today to celebrate the centenary of the WHR.
Mr Thomas was faced with two problems with regard to the sale of WHLR land. He was advised, or took the view, that in order to extinguish the company’s statutory obligations under the Light Railway Order of 1922, he had first to obtain an Abandonment Order from the Ministry of Transport. Alternatively, if he were to transfer WHLR to another railway company (as was ultimately achieved by FRC), he could apply for a Transfer Order. Contrary to subsequent legal advice, Mr Thomas took the view that for a sale to proceed to a company other than an existing railway undertaking, he would still have to apply for an Abandonment Order. Mr Thomas complained that he did not have sufficient funds to carry out either of these two courses of action. However, he did make a number of interest payments to the debenture holders which he later
25 J13/17749/27.
26 T. D. Jones, 9/23, Box 1.
27 Welsh Highland Railway (Light Railway) Company: … appointment of a liquidator by Chancery Division …: BT/325/2, National Archives, Kew.
28 Transfer Agreement, 4th February 1999. Festiniog Railway Company Archives, Porthmadog.
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requested be repaid to allow him to instruct counsel to advise about the complexity of the problems he faced. These repayment sums could have been utilised to secure either an Abandonment Order or a Transfer Order, neither of which would have been an highly expensive process and would have allowed the liquidation to proceed efficiently.
Parties interested in the WHR (as well as Mr Justice Vinelott in a later WHR case in 1991), assumed that the consent of the liquidator was required in order to obtain a Transfer Order. As a consequence, Mr Thomas was in an extremely strong negotiating position but in actual fact, his consent was not and had never been required. All parties overlooked section 73 (2) of the Railways Act 1921 which provided that a Transfer Order could be made ‘notwithstanding that the owners of the light railway do not consent [author’s emphasis]’. In addition, there was an insistence by Mr Thomas for any prospective purchaser to fully indemnify the liquidator which would have been prohibitively expensive. However, seemingly unknown to Mr Thomas at the time, the liquidator had the benefit of an indemnity insurance policy with the Commercial Union. Although these conditions imposed by the liquidator were unenforceable, they caused a number of interested parties to retract their overtures. Furthermore, if the investing authorities had received more pertinent advice they may well have considered other options, rather than resorting to receivership or liquidation both of which involved them in great expense with little reward. Fundamentally, the future of the track bed as a railway remained very much at risk during both receivership and liquidation.
The liquidator did receive several offers from purchasers with the intention of running a railway. 29 For example, in May 1961, Mr R. G. Honychurch applied for planning permission for a railway of 1ft 11½in gauge from Beddgelert to Nantmor. 30 Similarly, Mr L. M. Anderson of Birmingham, wrote on 6th June 1961 with regard to the line from Beddgelert to Aberglaslyn in the following terms:
‘I have all the track, rolling stock and ancillary equipment to open this section as a fifteen-inch gauge tourist line modelled after a certain Swiss railway’. 31
There were a number of other similar offers, and the involvement of a Mr J. R. Green is well known. However, the strongest lobby came from those who wanted the railway track bed to be developed as a long-distance footpath.
As early as 3rd December 1942, Caernarvonshire County Council resolved:
… the Council do approve of the proposal made by the Ramblers Association (Liverpool and District Federation) that it is desirable in the public interest that the track of the Welsh Highland Railway be dedicated as a public right of way for use of pedestrians and that the matter be referred to the Law and Parliamentary Committee for consideration and to report as to the ways and means of achieving this object. 32
29 Welsh Highland Railway (Light Railway) Company: question from Keith Hampson MP on behalf of a constituent interested in purchasing … BT/325/35, National Archives, Kew.
30 Long distance routes: Welsh Highland Railway; Carmarthen County Council, LR/318/COU 1/1534, National Archives, Kew.
31 COU 1/1534.
32 Access to the countryside: Welsh Highland Railway footpath proposal, HLG/71/1697, National Archives, Kew.
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The Manchester Guardian picked up the story and on 12th December 1942, published an article ‘Railway into Footpath’:
Eighteen months ago, the Liverpool and District Ramblers’ Federation suggested that the track of the derelict Welsh Highland Light Railway should be dedicated as a public footpath. Their case was a strong one, for the line had lost all prospect of rehabilitation and the ground it occupied was almost valueless for agricultural purposes. To the ramblers it offered an ideal route, gently graded and remote from traffic, through the Aberglaslyn Pass and the heart of Snowdonia along valleys otherwise devoid of footpaths … It is a plea that should not go unheeded. 33
National Park Commission
The National Parks Commission, set up by the National Parks and Access to the Countryside Act 1949 to co-ordinate government activity in relation to National Parks, had a particular interest in long-distance paths and proved to be central to the proposal to create a footpath utilising the disused WHR track bed. The Ramblers Association and others considered that the Commission would be an invaluable means of achieving their objective. The Commission expressed ‘great sympathy with the project of establishing a continuous path in an area of such unquestionable scenic beauty.’ 34 However, it was worried as to whether it had sufficient powers. On 20th April 1950, the secretary of the Commission wrote to Hugh Dalton MP, then Minister of Town and Country Planning. The Commission wanted to know whether the term ‘extensive journey’ in the 1949 Act covered the track bed ‘which would only take one or two days to traverse’. 35 The Commission continued to be interested in the project and so must have received a positive answer from the minister.
The liquidator, Mr Thomas, clearly considered that the relevant local authorities were prime prospective purchasers. In November 1953 he wrote to the Snowdonia National Park Joint Advisory Committee and at a subsequent meeting on 12th November 1953, it was resolved that:
‘… the Clerks, County Surveyors and County Planning Officers in Caernarvonshire, Denbighshire and Merionethshire be requested to meet and submit proposals for the establishment of a long distance route along the track of the Welsh Highland Railway and the track of the Ffestiniog Railway and thence across the southern part of the Snowdonia National Park with a view to continuing the route through mid-Wales to the proposed Brecon Beacons National Park and thence to St David’s in the Pembroke National Park and at the other end from Dinas to Conway and St. Asaph.’ 36
The Manchester Guardian in reporting the meeting included that a proposal to create a ‘Saints’ Way’ would kindle interest:
‘Mr Owen, Clerk to the Committee, urged that in order to secure the Exchequer grant payable on the purchase and maintenance of a long distance footpath the route should be extended from Port Madoc along the Ffestiniog railway track and beyond. Further extensions were suggested throughout mid-Wales to the proposed Brecon Beacons National Park, and thence to St Davids in the Pembrokeshire National Park, and at the other end from Dinas to Conway and St Asaph. A “Saints’ Way” linking the three parks would, it was thought, strike the imagination of the public. Doubts were raised by the Caernarvonshire members. They had been considering a footpath for years, they said, and it bristled with difficulties. … Their plea for caution was overborne, however, by the clerk’s reminder that the committee
33 ‘Railway into Footpath’, Manchester Guardian, 12th December 1942. 34 Proposed use of trackbed of former Welsh Highland Railway … BD28/502, National Archives, Kew. 35 BD28/502. 36 BD28/502.
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was on trial for three years, but the establishment of long-distance footpaths was a cardinal duty imposed by the National Parks Act, and the existence of the railway track offered an exceptionally favourable opportunity.’ 37
It is thought provoking that this ambitious plan also included the then derelict Ffestiniog Railway. On 14th January 1954, the clerk to the committee wrote to the Welsh Office seeking advice concerning grants available under section 97 of the 1949 Act. In a letter dated 5th March 1954, the clerk then wrote to the National Parks Commission enclosing detailed proposals of the intended path. The Treasury Solicitor replied in the following terms, ‘the powers in section 97 are permissive only … it seems unlikely that any provision will be made in the Regulations when they are eventually issued’. 38
By 1958 the Caernarvonshire County Planning Office was pressing the National Parks Commission for news of progress. On 20th January 1958 the Commission confirmed that it had ‘drawn a provisional line for a future long-distance route which incorporates part of the railway track’. However, progress was very slow since a report needed to go to the Minister, and it was ‘impossible to say when this might take place’.39 There can be little doubt that Mr Thomas was keen to sell the WHR track bed to Caernarvonshire County Council for the purposes of a footpath and the County Council was pressing to achieve the purchase. On 13th June 1959 the clerk to the County Council wrote to the Welsh Secretary at the Welsh Office. Part of the letter included the following:
‘The Liquidator of the Welsh Highland Railway (Light Railway) Company, Mr A. A. Thomas called to see me recently and enquired as to the possibility of the County Council acquiring the track of the Railway Company in view of the proposals mooted for a long-distance route from Caernarvonshire to South Wales. He explained to me that he had in the past rejected offers by various persons for the acquisition of sections of the track as he is desirous of keeping the whole length intact with a view to selling it to this Council for incorporation in the long-distance route. 40
Mr Thomaswas clearly concerned that his returns to the Board of Trade were demonstrating that the liquidation was becoming unnecessarily prolonged, and he sought the help of the County Council to explain the position to the Board of Trade, to whom he had to report. It was common ground that the National Parks Commission were some two years away from making a detailed recommendation to the Minister.
By December 1960 Mr Thomas had given up hope of selling the track ‘as a whole’ and in letter dated 13th December 1960 he informed the County Council that he was consideringsellingindividualplotsaccepting that parts of the track would subsequently prove un-saleable. 41 Mr Thomas then discovered that both members of his committee of inspection had died, whereupon he believed he was effectively without authority. However, he failed to appreciate the High Court had dispensed with the need for a committee of inspection in relation to this particular liquidation. Nevertheless, some three years later, on 13th August 1963, Mr A. Hugh-Jones, Mr M. Lewis and Mr W. Griffith were appointed to the committee of inspection, 42 and they resolved that Mr Thomas should proceed with a sale to a ‘preservation society’. Mr Thomas died shortly afterwards, on 3rd July 1964, following serious brain surgery.
37 ‘Plan for footpath through Snowdonia approved: Proposal for a “Saints” Way’, Manchester Guardian, 13th November 1953.
38 BD28/502.
39 BD28/502.
40 BD28/502.
41 BD28/502.
42 Welsh Highland Railway (Light Railway) Company: replacement of vacancies in the Committee of Inspection 1954 to 1963, BT/325/3, National Archives, Kew.
12
The Re-builders Appear
By virtue of the Companies Act 1948, Harold Gill of the Official Receiver’s Office assumed the liquidator’s role in September 1965. Mr Gill took issue with the appointment of a committee of inspection on the basis that on 18th November 1954 the High Court had ordered the vacancies need not be filled. One of his first actions was to seek monies (£223 11s. 7d.) 43 from the debenture holders to fund further legal advice. The funds were forthcoming, and Mr Gill received advice from counsel who had also drafted a contract for the sale of the track bed.
Mr Gill informed the debenture holders that ‘the former liquidator had neglected his duties’ and in an undated letter to the debenture holders confirmed that he intended to sell to a railway preservation society, WHLR (1964) Limited, for £5,750. Interestingly, all parties agreed that the sale would beconditional upon a Transfer Order being made by the Ministry of Transport;
‘… as a preliminary to an operating order for a minimum length of track bed land upon which a light railway can be operated. The time suggested for the obtaining of this Transfer Order is two years.’ 44
The conditional contract was fraught with legal complexities, and it is therefore no surprise that it did not proceed, and the County Council refused to sign. Caernarvonshire County Council ceased to exist in April 1974 and the new Gwynedd County Council was very slow to take the matter forward. Mr Dafydd Wigley MP entered the fray and commenced some forceful correspondence with the Official Receiver. In September 1975, Mr Bates of the Official Receiver’s Office prepared an internal, confidential note to assist with a reply to Mr Wigley. The note contains interesting comments that capture the views of both the Official Receiver and Gwynedd County Council. The following extracts from the note go to the very heart of the reasons for any lack of progress;
‘The Official Receiver has been advised by counsel that such land as is essential to the company’s undertaking cannot be sold without first obtaining an Abandonment Order … or a Transfer Order unless that undertaking has failed without hope of revival a proviso which in counsel’s view is ruled out by the existence of a preservation society…inthisconnectionitshouldbementionedthattheDepartmentofEnvironment, the authority responsible for light railways, stated in confidence, in late 1973 that they considered the proposals submitted by WHLR (1964) Limited as being neither realistic nor viable. The company has not shown that it was financially able to develop the railway and, to do so on the proposed piecemeal basis, was unsatisfactory. In their view, the area already had a proliferation of similar lines, and they did not see that this line offered anything new or unusual which would make it a financial proposition. … The present view of the County Council appears to be that it would wish to consider purchasing the whole of the track bed with the intention of creating a footpath over its full length; in fact, they have advised the Official Receiver that some 12 miles is already used as a footpath and is so shown on definitive footpath maps.’ 45
Trackbed Consolidation Limited (TCL), a breakaway group from WHLR (1964) Limited, embarked upon a process of reconstituting the WHLR company pursuant to section 206 of the Companies Act 1948 which required a three-quarter majority in value for a compromise or agreement between shareholders. The initiative failed when Dwyfor District Council refused to consent to the scheme. 46
43 Welsh Highland Railway (Light Railway) Company: application to appoint solicitor to advise on land title deeds … BT/325/6, National Archives, Kew.
44 BD28/502.
45 J13/17749/27
46 Preston, E., Trackbed Consolidation Limited and the Welsh Highland Railway (2015), 11.
13
Left: ‘Mr Justice Vinelott (photo taken in 1979) who threw a crucial lifeline securing the preservation of a railway rather than allowing its relegation to a footpath – see page 14
Sir John Evelyn Vincent Vinelott (1923 – 2006) was a leading barrister at the Chancery bar and an English High Court judge in the Chancery Division from 1978 to 1994.
Credit: Press Association
Left to Right - Bill Brown (Chairman), Richard Hilton, Don Amos, Bob Honychurch, Lawrence Brydon. Many years of frustration were to pass before the aspirations of these gentlemen were to be finally achieved in the 21st century’
Credit: WHRHG/Honychurch Archive
14
Above: Outside the Royal Goat Hotel Beddgelert, North Wales. Founding members of the original WHR Society (that later became the ’64 Company) pose for a photograph taken on 19th October 1962.
As is well known, in 1991, in response to the liquidator’s intention to seek consent from the High Court to sell the track bed to Gwynedd County Council, FRC sought to persuade the High Court that it had achieved the reconstitution of the WHLR Company. Mr Justice Vinelott rejected the arguments of FRC as being ‘wholly misconceived’. Nevertheless, and somewhat surprisingly, 47 he made orders that allowed FRC to commence the long journey towards a Transfer Order under the Transport and Works Act, 48 as detailed in a number of publications. 49
One particular objection of the many to FRC’s applications to gain control of WHLR, caused the Company to alter its direction of travel. Many of the FR’s supporters were strongly opposed to the company’s proposed acquisition of the WHLR. Mr Peter Thomason, a stockholder of FRC, was fiercely opposed. He was of the view that such an acquisition could only harm the interests of the FR. On 4th October 1990, Lovell White and Durant, solicitors, wrote on his behalf to FRC stating that the various contemplated activities to acquire WHLR were clearly ultra vires and that if FRC continued to seek control of WHLR, then an application would be made to the High Court for an injunction to prevent the acquisition. 50
Statutory companies (particularly those incorporated as early as 1832 such as the FRC), unlike companies incorporated under the Company Acts, have closely defined objects (defining the powers of the company). FRC had previously considered the ultra vires position with regard to its then travel business which subsequently had been transferred to a separate company, Ffestiniog Railway Holdings Limited. When the various competing applications for the control of WHLR came before Mr Justice Vinelott in 1991, Mr Robin Potts QC, counsel for Gwynedd County Council, argued that not only was the travel business ultra vires FRC, but also the transfer from FRC to Ffestiniog Railway Holdings. Mr Justice Vinelott decided to hold a second, separate hearing when Robin Potts QC developed his arguments further, causing some considerable concern to FRC. In a handwritten note to his board John Routly, the then FRC Chairman, recorded, ‘the technical point was argued ad nauseam by Potts for two expensive hours’. 51 Mr Justice Vinelott accepted that the travel business was ultra vires for FRC, but rejected the ultra vires argument in regard to the transfer to Ffestiniog Railway Holdings. Clearly taking a sensible and pragmatic view, FRC had decided at an early stage that in relation to the case seeking control of WHLR to be heard before Mr Justice Vinelott, Ffestiniog Railway Holdings would be the applicant thus effectively disposing of the ultra vires point.
It is arguable, perhaps with hindsight, that the seventy-two year period of receivership and subsequent liquidation was unduly protracted, mishandled and lacked professional application. The interests of the WHR were not at the forefront of the minds of the receivers, the liquidators or the investing authorities and as such the survival of WHR is in many respects remarkable. John Routly, in an undated note to his directors following the Vinelott decision in 1991, opined;
I have personally talked with the Official Receiver about identifying these risks. He is quite unhelpful. He has never seen the railway nor looked at the deeds and says because he knows nothing about it, he must have an unlimited indemnity. And only the GCC can do that! 52
47 Murfitt, S. ‘Humpty Dumpty’s Footpath,’ The Snowdon Ranger 15 (2022): 41-43.
48 Re Welsh Highland Light Railway Company [1991] 12 WLUK 251.
49 Hopkins (2000).
50 FRC Archives.
51 Undated note circa November 1991, FRC Archives.
52 FRC Archives.
15
A number of significant errors were made including, as described above, the requirement for would-be purchasers to obtain an indemnity policy, which would have involved them in great expense; also, the requirement for the liquidator’s consent for a Transfer Order to be obtained from the Ministry of Transport. Had these two fundamental mistakes been recognised earlier, then the number of parties competing for the WHR track bed may have been far higher leading to potentially different and ultimately fatal results vis-à-vis the eventual restoration of the railway.
A footpath or a second chance?
Jeremy Sullivan QC’s submission to the inspector of the Light Railway Inquiry in November 1993 was clearly correct having regard to the history set out above. It has been established that the intentions of the various investing authorities were for the WHR track bed to be a long-distance footpath. Ironically, in spite of the National Parks Commission’s rationale to promote footpaths, it is likely that its long-winded and pedantic processes saved the day. Had the Commission ultimatelymade a recommendation to the Minister for a long-distance footpath utilising the WHR track bed then it is difficult to see how that could have been prevented. It was a stroke of genius by Mr Justice Vinelott who, in dismissing the entirety of FRC’s case for control of WHLR, did not go on as may have been expected to give judgement in favour of Gwynedd County Council and the Official Receiver. Had he done so then it seems likely the Official Receiver would have transferred WHLR to the County Council and a footpath would probably have resulted. With some hesitation, Vinelott decided to give a second chance to FRC who had ‘shunted their application into a siding’. 53 He even went so far as to suggest a possible solution, namely an application under section 24 of the Light Railway Act 1896 for a Transfer Order, an avenue apparently not considered by any of the competing parties despite expensive legal advice.
Mr Justice Vinelott’s decision has not been accorded the recognition it deserves as a significant milestone in the WHR’s one hundred years of history. A wise High Court judge who dismissed the FRC’s case but nevertheless threw a crucial lifeline securing the preservation of a railway rather than allowing its relegation to a footpath. The 1991 case did not make the contribution to the common law that became the destiny of Jones v The Festiniog Railway Company (1868), 54 but it has since been cited as a precedent in a number of reported cases. 55 Nevertheless the case was of vital importance to the survival of the WHR and is a striking example of the law shaping FRC. 56 It is a tribute to a judge who had the foresight to recognise that although the Company had advanced a hopeless case, it was best placed, based on its history of achievements accomplished by Alan Pegler and others, to undertake the restoration of the WHR. It was the remarkable accomplishments of Alan Pegler and his directors and their sustained efforts to reopen the FR, that were a significant factor in Mr Justice Vinelott’s judgement. Although Vinelott did not himself adjudicate as to the competing claims of the parties, he identified a way forward for the Secretary of State to consider the various claims, which were ultimately resolved in FRC’s favour.
53 Re Welsh Highland Railway Light Railway Company [1991] 12 WLUK 251.
54 Jones v The Festiniog Railway Company (1868) LR 3 QB 733
55 Hitchins v Hitchins (Hatfield) Limited [2012] 5 WLUK 781.
56 Murfitt, S., Festiniog Law (2023).
16
Concluding Remarks
In the light of these conclusions, it would be right to examine whether there were other causes of action that could have been taken that may have resulted in the loss of the WHR. In October 1969, Stafford Clark and Co, solicitors, acting for the Official Receiver, delivered instructions to Mr William Goodhart. 57 Goodhart, a senior junior barrister who went on to become Lord Goodhart and sat in the House of Lords,58 was a specialist in High Court chancery matters. He was asked for an opinion with regard to nine questions of fact and law and advised that the debenture holders possessed a charge on the WHLR’s undertaking. However, the charge did not provide a right of sale as would usually be the case. He advised that in his opinion provided the consent of the debenture holders was obtained, there was no need to seek the High Court’s approval for a sale. The duty of the liquidator was to those who would benefit from the sale proceeds and that could only be the debenture holders. Therefore, provided the debenture holders consented to the sale of WHLR to Mr Green (then a prospective purchaser), or the railway preservation society (WHLR (1964) Limited) or Gwynedd County Council then ‘no one else can object and there is no need to apply to the court’. 59
Goodhart further advised that an Abandonment Order or Transfer Order would be needed before a sale could be achieved. However, he did advise ‘it is possible that it might be proper to sell without an Abandonment Order if it could be shown that the Company’s undertaking had failed without hope of revival; re Nottingham General Cemetery Co. (1955) Ch. 683.’ Goodhart advised that as a railway preservation society was a potential purchaser, this exception was not applicable. However, if the debenture holders agreed to sell to Gwynedd County Council, who intended to open a footpath and not run a railway, there was no need to apply to the court and no Abandonment Order was required. Based on Goodhart’s clear advice the liquidator could have sold WHLR to Caernarvonshire County Council as early as 1944 for the purposes of a footpath, which would have represented a significant saving in time and money.
The Welsh Highland Railway’s centenary is to be much celebrated particularly as the railway has survived against the significant odds. There can be little doubt that during an extraordinary period of seventy-two years, there were numerous opportunities when decisions could have been taken that would have led to the creation of a long-distance footpath, ‘The Saints Way’, rather than the resurrection of the longest heritage railway line in Britain.
57 FRC Archives.
58 William Howard Goodhart KC (1933-2017), British liberal politician, a leading property and human rights lawyer.
59 FRC Archives.
17
Bibliography
Primary sources
Access to the countryside: Welsh Highland Railway footpath proposal. HLG/71/1697. National Archives, Kew.
Caernarvonshire County Council Official Minutes. Gwynedd Archives. Caernarfon Record Office.
Hitchins v Hitchins (Hatfield) Limited [2012] 5 WLUK 781
Jones v The Festiniog Railway Company (1868) LR 3 QB 733
Long distance routes: Welsh Highland Railway: Carmarthen County Council. LR/318/COU1/1534. National Archives, Kew
‘Plan for footpath through Snowdonia approved: Proposal for a “Saints” Way.’ Manchester Guardian. 13th November, 1953
Proposed use of trackbed of former Welsh Highland Railway … BD28/502. National Archives. Kew.
‘Railway into Footpath.’ Manchester Guardian. 12th December, 1942
Re B. Johnson & Co. (Builders) Ltd. [1955] Ch. 634
Re Welsh Highland Light Railway Company [1991] 12 WLUK 251
T. D. Jones, London (Solicitors) Records: Welsh Highland Railway: Receivership, legal documents. 9/23 Boxes 1-6. National Library of Wales, Aberystwyth
Welsh Highland Light Railway: lease to Festiniog Railway Co. MT 47/407. National Archives, Kew.
Welsh Highland Railway (Light Railway) Company: application to appoint solicitor to advise on land title deeds … BT/325/6. National Archives, Kew.
Welsh Highland Railway (Light Railway) Company: … appointment of a liquidator by Chancery Division … BT/325/2. National Archives, Kew.
Welsh Highland Railway (Light Railway) Company: delay by liquidator to furnish record book: BT325/5. National Archives, Kew.
Welsh Highland Railway (Light Railway) Company: Judge's Copy Petition. J13/17749/27. National Archives, Kew.
Welsh Highland Railway (Light Railway) Company: question from Keith Hampson MP on behalf of a constituent interested in purchasing … BT/325/35. National Archives, Kew.
Welsh Highland Railway (Light Railway) Company: replacement of vacancies in the Committee of Inspection 1954 to 1963. BT/325/3. National Archives, Kew.
Welsh Highland Railway (Light Railway) Order 1922, No. 432
18
Stephen Murfitt
The Welsh Highland Railway Heritage Group
or Railway? On the descent from Pont Cae’r Gors to Hafod Ruffydd, approaching Ch. 17,000, the WHR turned to the right to initiate its entry into the ‘mini-horseshoe’ crossing the Afon Cwm-Du, followed quickly by the Afon Hafod-Ruffydd-Isaf.
