Scottish Court of Session Decisions

Subject_1 DECISIONS of the LORDS OF COUNCIL AND SESSION, reported by SIR PETER WEDDERBURN, LORD GOSFORD.

Mr Street, Merchant in London, and Jackson,
v.
James Masson

Date: 23 February 1672

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In a reduction and declarator, at the instance of the said Mr Street and Jackson, against James Masson, as son to James Masson, bis father, upon this ground:—That they being creditors to James, the father, for £3000 sterling, for which they had bonds for merchant ware, bought and delivered; and albeit the bonds were dated after an infeftment granted by the father, who was debtor, to the defender's own son, yet there being a constant and uninterrupted trade betwixt the pursuers and the defender's father, which was begun long before the right made to the son, the furnishing thereafter ought to be considered with a respect and dependence to the first correspondence, so as to give an interest to the pursuers, as lawful creditors, to reduce the right made by the father, their debtor, to his son, for no onerous cause; he being in familia, and having no other estate of his own.

It was alleged for the defender, That it being clear, by the pursuers' discharges, that they were satisfied of all debts due by the father before the son's infeftment; by our law and practick, the father might give a lawful right of his estate to his son; which being public, and might be found and known at the public registers, can never be affected with any debts contracted thereafter; seeing the Act of Parliament 1621, against bankrupts, is only in favours of lawful creditors, who are prior to rights made to conjunct persons, as being done in fraudem creditorum, but was never extended to posterior creditors, in prejudice of those who get rights and dispositions before the contracting of this debt, unless they were participes fraudis; which could not be here alleged.

It was replied, That the pursuers were founded, in common law, and the law of nations, for securing of public trade and commerce; for actio pauliana was competent to all lawful creditors, for the reducing of the conveyance of any estate made by debtors for no onerous cause, albeit the debts were contracted after the said dispositions; and, by our practicks, as in the case of Lord Newbyth and Burgy, and the creditors of John Pollock in the Canongate, the rights made by the father to the son were reduced, albeit they were creditors after the said rights; and in this case the fraud was most palpable and gross, the father and son being of one name, and the father continuing in possession until after the contracting of the pursuers' debts.

The Lords,—having seriously considered this as a new case, and the favourableness of the pursuers, who were strangers, and ignorant of our law for seeking after public registers; as likewise, on the other part, the great preparative and inconvenience of opening a door to innumerable pleas, for which we had neither law, practick, nor Act of Parliament, the defender being altogether innocent of the father's fraud, whereof all were convinced; as also finding, that the foresaid decisions were only in the case of latent rights, and not of public infeftments:—they, before answer, did ordain old Masson's count-books, and all his writs of real estate, to be produced, that it might be known if he had any estate besides what he had disponed to his son, which might satisfy his debts, so that he became depauperate by loss and misfortunes. As likewise, that probation might be led, if, notwithstanding of his son's infeftment, he did still remain master of the whole rights made to his son, so that he might destroy the same at his pleasure, that thereafter they might further consider upon this debate.

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