Hutton v West Cork Railway Co (1883) 23 Ch D 654 is a UK company law case, which concerns the limits of a director's discretion to spend company funds for the benefit of non-shareholders.

The case's practical significance was limited by cases and statute as in Re Horsley & Weight Ltd [1982] Ch 442 where the Court of Appeal held that a company's substantive object may include making gifts, and under Companies Act 2006, section 172 which entitles and obliges directors to regard interests other than shareholders as a proper exercise of their power.

After the completion of the transfer a general meeting of the company was held at which a resolution was passed to apply £1050 of the purchase-money in compensating the paid officials of the company for their loss of employment, although they had no legal claim for any compensation, and £1500 in remuneration to the directors for their past services.Cotton LJ and Bowen LJ held that the money payment was invalid.

In the course of his dicta, Bowen LJ held that there is.. ...a kind of charitable dealing which is for the interest of those who practise it, and to that extent and in that garb (I admit not a very philanthropic garb) charity may sit at the board, but for no other purpose.So according to Bowen LJ, directors can only spend,[2] money which is not theirs but the company’s, if they are spending it for the purposes which are reasonably incidental to the carrying on of the business of the company.

Bona fides cannot be the sole test, otherwise you might have a lunatic conducting the affairs of the company, and paying away its money with both hands in a manner perfectly bona fide yet perfectly irrational… It is for the directors to judge, provided it is a matter which is reasonably incidental to the carrying on of the business of the company… The law does not say that there are to be no cakes and ale, but there are to be no cakes and ale except such as are required for the benefit of the company.The upshot for a company in insolvency was that directors were not free to make payments to employees, because payments could only be made which were incidental to the business, and an insolvent business had no further business.