Scottish Court of Session Decisions

Subject_1 DECISIONS of the LORDS OF COUNCIL AND SESSION, reported by SIR DAVID DALRYMPLE, LORD HAILES.
Subject_2 BILL OF EXCHANGE.
Subject_3 The Drawer of a Bill, bearing to be “for value received,” having, in the course of an action on the Bill given different and inconsistent accounts of the cause of granting; found that he must prove onerosity.

Ann Murray
v.
Elizabeth Drew

Date: 18 June 1766

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David Drew, merchant in the isle of Whithorn, acquired some fortune by merchandise. He had a sister-german, Elizabeth Drew, and a sister uterine, Ann Murray, the pursuer and defender in this action. On the 12th May 1760, David Drew executed a disposition of his whole estate, heritable and moveable, in favour of Elizabeth Drew, his sister-german. He burdened her with a legacy of £100 sterling to the children of Ann Murray, and with an annuity of £3 sterling to Ann Murray herself, —“it being an express condition of this grant, as to her, that she shall behave herself to the satisfaction of Hugh Hawthorn of Castlerig.” On the 2d March 1761 he granted a factory for the management of his affairs to Alexander Laurie, son-in-law of Elizabeth Drew. This factory proceeded on the narrative, that “in the present state and circumstances of my health, I cannot manage, follow forth, and pursue my business and affairs as formerly.” On the 21st March 1761, David Drew, as it is said, signed, as acceptor, a bill, drawn on him by Ann Murray, for the sum of £65 sterling, bearing for value received, and payable fourteen months after date: Neither the body of the bill, nor even the word accepts, is in the handwriting of David Drew. In December 1761, David Drew died, and was succeeded in his fortune by Elizabeth Drew, his universal disponee. In July 1763, Ann Murray insisted, before the Sheriff of Wigton, in an action against Elizabeth Drew, for payment of the bill of £65 sterling. By her first plea, before the Sheriff, she set forth that the bill had been granted as a donation, or as a remuneratory acknowledgment of her services in managing the mercantile and domestic concerns of David Drew. She afterwards pleaded more definitely, that, if it were necessary to prove the bill onerous, she was ready to prove, by her own oath, that she had performed services to her brother, and that she got the bill for those services. The Sheriff found that no action could lie upon the bill, because it was acknowledged to be a legacy or donation. This judgment being pronounced, Ann Murray preferred a reclaiming petition, wherein she set forth that her procurator had given an imperfect view of the arguments which she had furnished to him; that the remuneration for her services had no connexion with the bill; and that those services still remained due. She pleaded that she had been in the practice of borrowing from and lending to her brother, David Drew; that at the date of the bill matters were stated between them; and that there came out in her favour a balance of £65 sterling, the sum for which the bill was granted; and this also she offered to prove by her own oath. The sheriff-substitute, without allowing Elizabeth Drew to see and answer this reclaiming petition, de plano allowed Ann Murray to instruct the onerosity of the bill by her own oath. Elizabeth Drew removed the cause from the Sheriff by advocation. Before the Lord Stonefield, Ordinary, Ann Murray pleaded a new defence in support of the bill, namely, that she had put a sum of money into the hands of her brother, in order that he might therewith purchase goods for her in England, and that, as his health prevented him from so purchasing, the bill was granted by him as a document of the money having been put into his hands.

On the 12th June 1765, the Lord Ordinary assoilyied Elizabeth Drew.

On the 27th November, and 13th December 1765, and on the 12th February 1766, he repeatedly adhered. Ann Murray reclaimed, and answers were put in to her petition.

Argument foe the Pursuer:—

The bill in question bears to be granted for value, and it cannot be disproved but scripto or juramento of the drawer: the value given was money lodged in the hands of David Drew for the purchase of goods which, in fact, he did not purchase. The pleas, that the bill was a donation, or remuneratory, or for the balance of accounts, were pleas injudiciously and unwarrantably made by a country procurator; and the consequences would be dangerous were such hypothetical allegations held equivalent to the formal assertion of the parties themselves, or of their counsel in the Supreme Court. But, supposing the bill to have been gratuitous, it is not a decided point that a donation may not be constituted in the form of a bill. Bills were first received into Scotland with a view to mercantile transactions, and in some sort contrary to the nature of legal securities: At first they respected foreign commerce, afterwards they were extended to inland trade, at last they came to be used in all transactions indiscriminately, whether of a mercantile nature or not. Thus bills are every day drawn and accepted by men who do not come under the denomination of merchants. Thus, in practice, inland bills, instead of being reputed mercantile transactions, are considered as mandates given by one party and accepted by another. Now the proper idea of a mandate is that of a contract purely gratuitous; insomuch, that, if a valuable consideration intervene, it is no longer a mandate, but the contract locati conducti. The last decision of the Court pronounced upon this question shows that a donation may be properly constituted by a bill. On the 8th February 1753, a question was determined between John Barbour and Agnes Hair. Humphrey Barbour, some days before his death, delivered two bills to his wife, indorsed blank, and used expressions, at delivery, implying his desire that she should keep them to her own use. The executors of Barbour pursued her for delivery of those bills. “The Lords found the bills in question were properly conveyed to the defender, and therefore sustained the defence against the delivery.” Were bills an inhabile method of making a donation,—a fortiori, the indorsation of bills, especially when indorsed blank, is an inhabile method of making a donation. The inexpediency in the one case is greater than in the other: for a bill indorsed blank may be lost or stolen, and thus may be transferred without the intention of the indorser, whereas an acceptor can never bind himself without intention. But supposing the plea urged by the pursuer's procurator to have been true, namely, that the bill was granted on account of services performed to David Drew, it follows that the bill was not gratuitously granted. The acting in the quality of a servant is a valuable consideration; a bill for money, granted on such account, cannot be gratuitous, and it is customary to grant bills for servants' wages in this form.

Argument for the Defender:—

The bill in question is in itself suspicious: the name of David Drew is adhibited to it, and no more but his name: even the word accepts is in another hand. The bill bears to be granted some few days after David Drew had formally declared himself unable to manage his own affairs. It is made payable at the distance of fourteen months; that is, it was plainly to be due not till after the death of the granter: add to this the various and inconsistent accounts which the pursuer has given of the cause for which the bill was granted, and a violent suspicion will arise that David Drew was imposed upon; possibly by signing as acceptor when he meant to sign as drawer. The pursuer, after having pleaded before the inferior Court that the bill was granted as a donation, or as remuneratory of services, cannot be admitted to plead upon causes totally different. That a donation cannot be constituted by bill is a point determined, 13th February 1724, Huttons against Hutton; 9th November 1722, Fulton and Clark against Blair; and 3d December 1736, Weir against Park-hill. The case Barbour against Hair was determined upon this, that the delivery of an indorsed bill was equivalent to an absolute immediate payment of money. Although mandates be considered, in the Roman law, as gratuitous contracts, bills cannot be considered in that view. They cannot be considered as gratuitous between the debtor or acceptor, and the creditor or porteur. He who has effects in his hands, is bound to accept or obey the order to pay. He who, without having effects in his hands, obeys the order, is still entitled to commission, exchange, or other valuable consideration. The pretence of the bill having been granted as remuneratory of services done to the brother, cannot be received without full evidence, and the pursuer's offer to prove this by her own oath, will not be considered as evidence; when it is acknowledged that other causes of granting the bill were also assigned by her, and in like manner offered to be proved by her own oath. As often as she found herself driven from one defence in fact, she resorted to another; and, for proving all those defences, however contradictory and inconsistent, she still made reference to her own oath.

“The Lords found that the pursuer must instruct the onerous cause of the bill in question, according to her allegations in Court.”

Act. A. Crosbie. Alt. G. Wallace. OPINIONS.

Pitfour. The decisions Hutton and Fulton both proceed upon this, that a bill is not a habile method of constituting a legacy. The case Weir against Parkhill, 1736, collected by Mr Alexander Hume, was of a bill which bore, in gremio, payment of a legacy. Where the bill so bears in gremio, the objection is good: but to go farther, and to enter into the investigation of the cause, where a bill bears for value, would be going too far. There is no evidence of a gratuity in this case, nothing but the clatters of a country procurator.

Auchinleck. Bills have been introduced for the sake of commerce contra communes juris regulas. Bills for gratuities are void: not because so expressed; for, if such cause had been lawful, the expressing the cause would not have hurt the bill. This case gives a strong view of the bad consequences arising from the extension of bills to causes not commercial.

Barjarg. The bill bears for value, and this must be held to have been the cause until the contrary be proved.

Justice-Clerk. Drew was moribundus when this bill was signed. It was signed nineteen days after he had granted a factory declaring himself incapable of managing his own affairs. The pursuer's procurator offered a clear categorical state of facts, asserting the bill to have been granted as a gratuity. The pursuer afterwards changed her ground, and, with equal precision, asserted that the bill was granted for services. This, according to her latest assertions, is altogether false.

Kaimes. There is some difficulty in holding the acknowledgment of the procurator, that the bill was gratuitous, to be equivalent to the pursuer's own acknowledgment; but this difficulty is removed when her vacillancy, during the whole process, is considered.

Gardenston. The allegation of Drew's incapacity is nothing; for the only evidence of his being incapable arises from his being capable to grant a factory. There is no evidence that the bill is false. Services performed by a relation is an onerous cause.

Coalston. The bill bears for value: the objector must prove the contrary. But here the difficulty lies, that the holder of the bill has given different and inconsistent accounts of the cause of granting.

President. Those decisions are good which found that bills debording from their proper form are not probative. The plea of services not relevant, as was determined 11th February 1761, Wright. The whole circumstances of the fact bear against the pursuer. The onus probandi lies on her to make out her last allegation that the bill was granted for value actually received by Drew.