Cases which peculiarly regard the particular terms of the late Bankrupt Statutes, from 1772 downwards.
John Beadie v. The Other Creditors of Thomas Heggie
Date: 31 January 1787 Case No. No 272.
23d Geo. III. c. 18. - A sequestration had been obtained at the instance of a creditor, whose debt was less than the sum specified in the act. Alleged, that this rendered the proceedings null. The Court found otherwise.
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After the effects of Thomas Heggie had been sequestrated in virtue of the statute 23d Geo. III. and a factor appointed, it was discovered by John Beadie, an arresting creditor, that the debts due to the persons, at whose instance these proceedings had been held, were not of the extent required by the statute.
He therefore preferred a petition to the Court of Session for recalling the sequestration; and
Pleaded: The chief defect of the statute of 1772, authorising the Court of Session to award sequestrations, arose from its not being confined to those persons who, from the nature of their business, as well as the extent of their commercial transactions, were the proper objects of such a regulation. The after law, therefore, passed in the 23d of his present Majesty, while it limited sequestrations to the case of merchants and traders, was particularly careful to remedy this defect, by enacting, that no sequestration should be awarded, unless on the application of one creditor for L. 100, of two for L. 150, or of three for L. 200. It is indeed true, that where a sequestration has been obtained, of the effects of one, who afterwards appeared not to be of that condition in life, which comes under the statutory description, the right of applying for redress has been specially limited to thirty days. But as no similar provision occurs with regard to the extent of the debts, this circumstance seems rather to confirm than to weaken the present argument.
Answered for the other creditors: To prevent sequestrations where the amount of the debts owing by the bankrupt is very inconsiderable, it has been provided, that the creditor or creditors applying, shall make oath, that their claims are of a certain extent. But from this it is not to be imagined, that where the debts due to those creditors have, either by mistake, or even from a more unjustifiable cause, been exaggerated, the whole proceedings are on that account to become ineffectual and void. This might be reasonable enough with regard to the parties in whose names the application was made; but with respect to the creditors in general, who are naturally led to consider a sequestration as a suspension of every other mode of diligence, it would be highly unjust. Nor, in fact, does this statute labour under so great an imperfection. Though any individual injured by an improper application, may doubtless obtain redress from the persons who have occasioned his loss, still the sequestration itself subsists in its fullest extent. The limited provision which has been made for recalling a sequestration, where the employment of the bankrupt has been erroneously described, would be alone sufficient to show this to have been the intention of the Legislature.
The petition was remitted to an Ordinary; who, after a proper inquiry into the facts, reported the cause to the Court.
‘The Lords refused the petition.’ See Sequestration.
Reporter, Lord Henderland.Act. Buchan-Hepburn.Alt. Maconochie.Clerk, Home.
Fac. Col. No 304. p. 469.
