Subject_1 ADJUDICATION and APPRISING. Subject_2 RANKING of ADJUDGERS and APPRISERS.
Ranking of the Creditors on the Estate of Tulloch
Date: 27 January 1756 Case No. No 25.
Adjudgers without year and day of the first effectual adjudication, are ranked according to their dates, without regard to their infeftments.
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In the year 1736, Margaret Bayne, a creditor of Bayne of Tulloch adjudged his lands of Tulloch, and was infeft in April 1740.
From July 1745 till November 1747, four other adjudications were deduced; but no infeftment followed on them.
In December 1747, the trustees of Andrew Drummond adjudged the same estate, and on their adjudication were infeft.
In the ranking of the creditors, on a judicial sale of the lands of Tulloch, it was allowed that Margaret Bayne was the preferable creditor; but a dispute arose for the next preference, betwixt the four next adjudgers and the trustees of Drummond.
The question came to be, Whether in adjudications, without year and day of the first effectual one, the next adjudgers not infeft, or adjudgers after them being infeft, ought to be preferred?
Pleaded for the adjudgers infeft: The effect of the first adjudication and infeftment is not to denude the debtor of the property of the lands under redemption, but only to give the creditor a pignus prætorium, or right in security: An adjudication creates not a transfer of the property, but only an incumbrance on it; consequently one cannot be fully divested but by infeftment; and therefore the last adjudgers first infeft must be preferred.
The general rule of the law of Scotland is, That in land-rents which are completed by infeftment, the first infeftment is preferable, even where the disponer himself has only a personal right to the lands, and may appear to have been denuded of that personal right by his disposition; yet his last disponee last infeft is preferred to his first disponee not infeft: In adjudications, which are only legal dispositions, the same rule should take place.
Pleaded for the adjudgers not infeft: An adjudication is not a pignus pretorium; on the contrary, in its origin in the statutes of Alexander II. and James III. it was simply a sale at a price, under a faculty of redemption, competent to the debtor within seven years.
In consequence of this, the debtor being denuded of his right to his lands, in favour of the first adjudger, by charter and sasine, and nothing remaining with him but a right of reversion, this right of reversion is carried by a second adjudication, as effectually without infeftment as with it.
When a debtor is denuded of a part of his lands by infeftment upon a proper wadset, the right of reversion, which remains with him, is fully carried by adjudication without infeftment; adjudications are legal conveyances under reversion. The same rules, then, which apply to the reversion of other redeemable sales, or wadset rights, apply to them.
The argument for the adjudgers not infeft, is strengthed by expediency: For if every creditor without the year was obliged to take a new infeftment from the superior, to prevent his being cut out by the subsequent diligence of other creditors, the burden upon creditors would be increased, and their fund of payment lessened. ‘The Lords preferred the simple adjudications without infeftment, according their dates, notwithstanding the infeftment upon the adjudication at the instance of Drummond's trustees.’
Reporter, Kames.For the Trustees, Lockhart.Alt. Ferguson.Clerk, Kirkpatrick.
Fol. Dic. v. 3. p. 14. Fac. Col. No 180. p. 267.*** In Lord Kames's Select Decisions, the case is mentioned thus:
In the year 1736, an adjudication was deduced of the estate of Tulloch, for the accumulate sum of L. 9000 Scots; upon which Kenneth M'Kenzie of Seaforth obtained charter and sasine in the year 1744. This was admitted to be the preferable adjudication. None were led within year and day, nor for several years after. The second adjudication is dated the 20th July 1745; after which, four follow in the year 1747, one in July, two in November, and one in December. The last mentioned adjudication was for a great sum due to Mr Andrew Drummond banker in London, who being the latest, found it necessary to proceed to complete his adjudication by infeftment.
These diligences being all produced in the ranking of the creditors of Tulloch, there was no opposition made to the preference of Seaforth's adjudication, which was acknowledged to be the first effectual adjudication, and no other within year and day. The other adjudications, being without year and day, did not come under the regulation of the act 1661, ranking adjudications pari passu which are within year and day of the first effectual. It was admitted on all hands, that the ranking of these adjudications must proceed upon the principles of the common law, as if the act 1661 had not been made; and the question was, What must be the rule of preference? Mr Andrew Drummond pleaded a preference upon his infeftment, none of the other adjudgers being infeft. They, on the other hand, insisted for a preference, each of them according to their dates, upon this ground, That an adjudication is a judicial sale under reversion: That Tulloch accordingly was denuded of his property, which was effectually conveyed to M'Kenzie of Seaforth the first adjudger, who was infeft: That nothing remained with the debtor but a personal reversion, which was effectually carried by the second adjudication, without necessity of infeftment, and indeed without possibility of infeftment; because a personal reversion, which is the subject carried by the adjudication, admits not of infeftment. Following out the same train, the third adjudication carries nothing but the reversion of the second, and so on. In this view, the infeftment taken by Mr Andrew Drummond is altogether inept; and the whole adjudications engaged in the present competition must be preferred each of them according to their dates.
To this reasoning it was answered for Mr Drummond, That an apprising, which was originally a judicial sale under redemption, was, by act 6, Parl. 1621, degraded to be a judicial security. By intromission during the legal, with as much as satisfies first the interest and then the capital, an apprising is, by this statute, declared extinguished ipfo facto; which is agreeable to the nature of a judicial security, but inconsistent with a sale under redemption. Accordingly, from the period of this statute, when an apprising or an adjudication is found satisfied by voluntary payment, or by intromission with the rents, it is not found necessary that the land should be re-disponed to the debtor, nor that the debtor, upon his right of reversion, should use an order of redemption.
It may be true that our later writers, carelessly using the language of the old law, talk sometimes of the reversion, of an apprising, and that posterior apprisings require not infeftment, because they carry only a right of reversion. Lord Stair, in particular, sometimes expresses himself in this manner. But he talks a very different language where it is his professed purpose to explain the nature of an apprising. He says, in the clearest terms, b. 3. tit. 2. § 38. of his Institutes, “That apprising is but a legal diligence for security of the sum, which ceasing, it falleth without other solemnity, and the debtor's own infeftment stands valid without renovation; with which the infeftment upon the apprising stood but as a parallel right for security.”
It was replied for the other adjudgers, That it was not the intention of the act 1621 to alter the nature of an apprising; but merely upon a principle of equity, to oblige apprisers to account for intromissions, who, grasping at exorbitant advantages, were in use to apprise the debtor's whole lands, without regarding the disproportion betwixt the debt and the subject attached for payment. There is not the least insinuation in the act, that it was the intention of the legislature to introduce a new species of apprisings; and what is done by the act is consistent with their nature as a judicial sale. A proper wadset held of the superior is, in the strictest sense, a sale under reversion; and when the lands are redeemed, a new infeftment is necessary to reinstate the reverser in his property. At the same time, if a creditor, grasping at exhorbitant profit, wrests from his debtor a proper wadset, with rigorous and usurious clauses; such wadset will be considered as improper, and a right in security only, which will be extinguishable by intromission, without putting the reverser under a necessity to take a new infeftment. The case is much the same with an apprising or adjudication where there is no proportion betwixt the debt and the subject attached. Every diligence of this kind will so far be considered as a right in security only, that it will be extinguished by intromission, and put the debtor under no necessity to take a new infeftment. But however disproportioned the debt may be to the subject, yet if the creditor, wanting no exorbitant profits, abstain from the possession, ready every hour within the legal to take the sum due to him; he is in that case entitled to use his adjudication as a judicial sale, and to lay hold of the property after the legal is expired. One thing is certain, that the act 1621 applies not to this case, but solely to the case of intromission. And, therefore, without diping so far into the argument as is done above, it may be justly argued, that supposing, that by the force of the act 1621, intromission converts an adjudication into a right in security, it by no means follows, that an adjudication must be a right in security where there is no intromission.
“ The Lords were generally of opinion, That the nature of an apprising was not altered by the act 1621, especially where there is no possession, as in the present case; that after Seaforth was infeft upon his adjudication, nothing remained with Tulloch the debtor, but a personal reversion, which is not capable of infeftment; and upon this precise ground the competing adjudications were ranked according to their dates; and consequently Mr Drummond's adjudication ultimo loco, though infeftment was taken upon it.”
This is one of those intricate points which are not yet finally adjusted upon principles of law or utility; and where, of consequence, the Court leans sometimes to one side, and sometimes to another, according to the equity of the particular case in which this point happens to be disputed. In the present case, every collateral consideration inclined the Court to the judgment that was given. An argument, from expediency, moved them not a little; namely, the hardship of obliging every adjudger without year and day of the first effectual one to take infeftment; hard upon the creditors, and ruinous to the debtor. And it moved them also, that after the estate is totally exhausted by adjudications, it should be in the power of a creditor for a great sum, coming long after the rest, to sweep the stakes merely by taking infeftment. I am apt to believe, that had the favour lain on the other side, the Court would have been more divided about the present point. And indeed, after all that is set forth above, many difficulties occur to me; one of which I shall state, because, as far as I can see, it appears unsurmountable. An adjudger takes infeftment, but forbears intromission, waiting patiently for his payment. The debtor at last finds credit, and makes payment within the legal, Quæritur, Is it necessary that he should have a disposition of land from the adjudger, in order to be again infeft by the superior? Upon the prevailing argument, this is indispensibly necessary; for one infeftment of property cannot be taken away, but by another infeftment of the same kind. Yet I venture to affirm, that such a thing is not dreamed of in our practice. We require no more solemnity in extinguishing an adjudication with infeftment, than in extinguishing an infeftment merely for security.
However this be, I close the present subject with the following remark. Here a rule is established for ranking adjudgers without year and day, where infeftment happens to be expede upon the first effectual adjudication. But what if the leading adjudication be made the first effectual by a charge against the superior without infeftment? This alters the case totally; because, upon this supposition, the debtor remains proprietor, and his infeftment stands good. It appears to me, that if this had been the present case, Mr Andrew Drummond, who stood infeft upon his adjudication, must have been preferred to his competitors, none of whom were infeft.
