Scottish Court of Session Decisions

Subject_1 COMPENSATION - RETENTION.

Maxwell
v.
Creditors of M'Culloch

1739, Jan. 2.
Case No. No. 5.

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At advising, it appeared that one of the bonds due by Sir William Maxwell to Sir Godfrey of L.2000 in 1683, was originally payable to Sir Godfrey himself, that another bond of L.1200 was taken, payable not to Sir Godfrey, bat to one of his creditors, Andrew Houstoun, and only became due to Sir Godfrey upon Andrew Houstoun's operating his payment out of another debt in 1692, after all the debts due by Sir Godfrey to Sir William Maxwell were in Sir William's person, so that as the compensation on this debt could operate no farther back than 1692, there was no great question that this debt might be applied to compense the debt last acquired by Sir William,—but all the question was anent the L.2000 debt due to Sir Godfrey in 1683, before Sir William acquired any of Sir Godfrey's debts,—as to which, both the President and I, and some others, thought it behoved to apply in extinction of the first debt acquired by Sir William, according to the rule laid down by Lord Stair, and indeed the reason of the thing. But it carried by a good majority, that Sir William had the election to apply it to any debt he pleased, so as to save the collateral security that he had in the escheat for several of his debts. 14th November 1738.—2d January 1739, The Lords adhered as to the general point.—Quod vide (infra.)

The Lords found, that as to the three debts, the recompensation as then sustained must stand; but as to Martin's debt, that the creditors are not bound by that decreet, unless Sir William Maxwell instruct the payment of that debt; and as to the balance, they adhered to the former general interlocutor of 14th November; and indeed were of opinion, that compensation does not by our law operate ipso jure but from the time of proponing, though it stop the course of interest, and is competent against assignees, &c. (President et me, multum renit.) But we seemed to agree that Sir William Maxwell could not recompense upon debts acquired after Sir Godfrey M'Culloch's bankruptcy; but as that point was not at all argued in the answers, we remitted that point to the Ordinary.—2d January 1739.