Effect of purchasing Goods by Persons who know themselves to be Insolvent.
Thomas Main v. The Keeper of the Weigh house of Glasgow, and James Maxwell
Date: 18 January 1715 Case No. No 40.
Found to conformity with the above.
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James Maxwel sold ten hogsheads of tobacco to Robert Simpson's wife, which were weighed at the weigh house of Glasgow, and marked as sold to her on the 11th of February 1709; but not being satisfied with the security of the price, did cellar the said tobacco for his own account upon the 12th of the said month and year, and sometime thereafter removed the tobacco for his own account.
Thomas Main, a creditor to Robert Simpson, arrests in the hands of the keepers of the weigh-house; and pursues a forthcoming; in which the Lords found, that the weighing over the tobacco in the name of Robert Simpson's wife, did transfer the property, and that therefore the keepers of the weigh-house were liable to make the tobacco forthcoming, and that they could not warrantably have suffered James Maxwell to remove the same.
James Maxwell raised reduction of the bargain of sale, alleging, that dolus dedit causam contractui, in as far as Robert Simpson knew himself to be altogether insolvent at the time of the bargain, and very soon thereafter broke, viz. in April, about two months thereafter; and for instructing that he was truly insolvent at the time, produced a disposition omnium bonorum granted by him to his creditors in the beginning of May, within three months, narrating several debts, amounting to above L. 500 Sterling due by bond, all of dates anterior to the bargain; and that it was just and reasonable, that he should dispone to them all his means and estate so far as it would go towards the payment of these debts; and the said Robert Simpson being but a small dealer by retail, his effects were but very inconsiderable; and he lived ever since by his handy labour as a servant; whereby it plainly appeared, that Maxwell was circumvened.
It was answered; That whatever might be alleged against Robert Simpson, yet the pursuer, a just and lawful creditor, cannot be reached upon any pretended fraud of his debtor, wherein he was noways partaker; and there is a clear difference laid down in the act of Parl. 1621, betwixt the persons guilty of fraudulent deeds, and third parties transacting bona fide; who, for the favour of commerce, cannot be prejudged by any personal objections against their debtors or authors. 2do, Neither is the probation relevant to instruct the fraud; because the disposition produced is after Simpson was become notourly bankrupt and imprisoned, whose assertion or declaration can prove nothing.
It was replied; The fraud is undoubtedly relevant to reduce the bargain, and restore the seller to the property, not only against the seller personally, but likewise against the pursuer his creditor an arrester; who is not in the case of a third party mentioned in the act of Parl. 1621, because he is not a purchaser bona fide paying a price to Robert Simpson for the tobacco; nor did he receive that tobacco from Simpson in payment and satisfaction of his former debt, and discharge the sum to Simpson; in which case, for the favour of commerce, he would be secured; because it were more just that he who paid his money, and had given up the instruction of his security, should be safe, and have the benefit of his bargain, than Maxwel who trusted Simpson; but being only an arrester, utitur jure auctoris; and the tobacco being still in medio, it was more for the advantage of commerce, that the seller should be restored to the property of his goads, which he was fraudulently induced to sell upon trust, than an arrester who advanced nothing, and the effect of whose diligence depended upon the property of his debtor. And as to the probation, there could not be any other document afforded of Simpson's insolvency at the time; for he did not keep a regular book; and it is not alleged that he had any effects towards the value of the debts he owed, nor that he had any loss in the course of his small trade, from the date of the bargain of tobacco, to his becoming notour bankrupt. And, in a parallel case, determined in December 1680, Prince contra Pallat, No 39. p. 4932., the Lords reduced a bargain in circumstances which quadrate perfectly with the present case; for there Arthur Udny having commissioned three tun of wine, the same were loaded aboard a ship at Bourdeaux, bound for Leith; but Peter Pallat, suspecting Udny's credit, wrote to his correspondent not to suffer the wine to be delivered; and Prince having arrested, and obtained a furthcoming, which was suspended, ‘the Lords found the property was transferred to Udny; but found it relevant to be proven by his book or oath, that his debts exceeded his estate the time he gave the order, to annul the contract of vendition.’ In which case Udny broke, and fled within three months; from whence it was inferred, he was meditatione fugæ the time of the order; which quadrates with this case in every circumstance, both as to the relevancy and probation. And albeit that be a single decision, yet the reason of it is good, and it is much safer to follow a rule that has been deliberately determined, than to render the like case uncertain by varying the decision on the same grounds.
‘The Lords found the fraud relevant against the arrester, and proven.’
Fol. Dic. v. 1. p. 335. Dalrymple, No 130. p. 181.
*** This case is reported by Bruce, No 69. p. 945.
