Decisions upon the act 5th Parliament 1696, declaring Notour Bankrupts.
Subject_3 SECT. VI.
Securities granted in consequence of Anterior Obligations.
Mackintosh v. Heriot
Date: 14 June 1745 Case No. No 218.
A bankrupt, who held a bond in trust, of which he was bound to denude, found not entitled to execute an assignation of it, in prejudice of the trust.
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Lauchlan Mackintosh merchant in Inverness, owed Duff of Culbin 2000 merks, and the Trustees for Culbin's creditors having exposed all his effects to roup; he employed John Shaw writer in Edinburgh, to purchase this bond for his behoof, which Shaw did for 2000l. Scots, a sum within the principal and interest then due, and took the conveyance to himself, giving bond to the trustees for the agreed price, conjunctly and severally with Mr William Duff of Cromby, advocate, who interposed at the desire of Mr Mackintosh.
Mr Mackintosh remitted to Shaw L. 90 Sterling, to apply to the payment of this bond, which he intervened to his own use.
John Shaw had also engaged Thomas Heriot, merchant in Edinburgh, to be cautioner for him to the Bank of Scotland, in the sum of L. 250 Sterling; and he having paid it, and pursuing Shaw for his relief, Shaw assigned to him this of Mackintosh's, to the extent of L. 2000; Scots so that on the one hand Mackintosh, if found still liable in the debt, had lost his L. 90, and was bound to relieve Mr Duff of Cromby; and, on the other, Heriot had engaged with Shaw to borrow the sum from another hand to pay the Bank, which Shaw having also interverted, he had been obliged to pay it besides; and none of them could expect any relief from Shaw.
Mackintosh raised a process against Heriot and Shaw for declaring a trust in Shaw's person, and went on these grounds, That the purchase being made for his behoof, no translation could be effectual to his prejudice; and this fact appeared from Shaw's letters in process, at least, it plainly appeared Shaw stood obliged to denude in his favours; and therefore this exception must not only be good against him, but his assignee pursuing for the debt; and that Heriot was in mala fide to take the assignation.
Mr Heriot alleged, That the debt stood made over to Shaw, who had it therefore in his power to dispose upon it; and he was his most onerous creditor, and took the assignation bona fide; and behoved equally to be at a loss, if it were not sustained, as the pursuer, if it were.
There was a good deal of arguing in the papers, whether this were a trust or no; or if it was, whether it could be proved otherwise than by an explicit back bond; or if the letters were not equal to one; or whether a trust of this sort, which was not a deed vesting a right in the trustee for the granter's own behoof, fell under the statute, and might not be proven by circumstances: But what weighed most with the Lords was, that Shaw was under an obligation to denude; and therefore, if he had pursued for the debt, this would have been an answer, which must also meet his assignee: So that this case is of the same nature with the decision of Glendinning's Creditors against Magbyhill; Kilkerran, p. 44, and D. Falconer, v. 1. p. 99. voce Bill of Exchange.
Observed also, That there was a difference betwixt Mr Mackintosh's employing him to buy his own debt and another man's; for that the bond to the trustees was payment, which must be good against an assignee.
The Lords decerned in the declarator.
Reporter, Lord Tinwald.Act. H. Hume.Alt. Lockhart.Clerk, Gibson.
D. Falconer, v. 1. p. 100.
