Scottish Court of Session Decisions

The late John Anstruther of Airdit executed a trust-deed, conveying his moveables and heritage, under certain exceptions, to Sir Robert Henderson, Baronet, Captain John Cheape of Rossie, and James Heriot of Ramornie, W.S., as trustees and executors. The purposes of the trust were, 1. To pay debts; 2. To pay legacies and provisions specified in any codicil to be executed; 3. To pay certain legacies, amounting to about £10,000; 4, 5, and 6. To pay certain annuities and legacies; 7. “My said trustees are hereby requested to accept each of them of the sum of £500 sterling, as a mark of my friendship for them, and the farther sum of £105 sterling each, to purchase for each of them a hogshead of claret, as a recompense for their trouble in the management of my affairs, and as a farther testimony of my affection for them—the said legacies to be paid by my said trustees, including the legacies and sums left to themselves respectively, at the first term of Whitsunday or Martinmas after my death, and to bear interest thereafter, during the non-payment; and the said annuities are to be paid by them at two terms in the year, Whitsunday and Martinmas, by equal portions, beginning the first term's payment at the first of those terras which shall happen after my death.”

Power to sell the heritage by public roup or private bargain, was given to the trustees, and “also to appoint either one of their own number or any other person, from time to time, as factors or cashiers for collecting and receiving the said debts and sums of money, rents, and arrears of rent, interest, annuities, dividends, and prices of stock, and prices of lands, houses, and other heritages, and other goods and effects hereby conveyed, and for applying the same to the uses and purposes before mentioned, or to be hereinafter directed by me; and to give such factors or cashiers, or any other person to be employed in executing this trust, such allowances for their trouble as my said trustees shall think reasonable; and, in general, to do every thing necessary for the proper execution of the trust hereby created; but with and under the conditions after-written, as it is hereby expressly conditioned and provided, that my trustees, or trustee acting under this trust, shall be holden and obliged to apply and employ the funds and subjects hereby disponed, and the price and produce thereof, for the uses and purposes before mentioned, or of any other uses and purposes to be hereinafter directed by me.” “As also declaring that my said trustees and my executors, acting under and by virtue of these presents, shall not be liable for any omissions or neglects in their management, nor for the intromissions or solvency of the factors, or others whom they employ, or the debtors whom they intrust, but shall only be bound to act honourably, and shall only be liable for their actual intromissions, and each of them for himself and his own actual intromissions respectively, and no farther.”

The estate of Airdit was excepted from the trust-disposition, and, on the death of the truster, it descended to his heirs-at-law, the late Earl of Traquair, and Lientenant-General Ainslie. Sir Robert Henderson, and Messrs Cheape and Heriot, accepted and acted as trustees. At the commencement of the trust in 1819, they appointed Heriot, who had been the truster's agent, their factor; and, by the minute of appointment, directed him “to open a deposit-account, to be kept with the British Linen Company on their account, from which Mr Heriot can operate and draw the sums required to pay off the debts due by Mr Anstruther at the time of his death, and pay in such sums as he shall receive;” and they granted a commission and factory to Heriot in these terms:—“Considering that it is necessary for us, with a view of accomplishing the purposes of the trust thereby committed to us, to sell and dispose of the property thereby disponed to us, for the purposes of paying off the debts due by the said John Anstruther, and the legacies left by Mm: And having confidence in the said James Heriot, writer to the Signet, we therefore hereby nominate and appoint the said James Heriot to be our factor and commissioner to the effect under written, giving, granting, and committing to him our full power, warrant, and commission for us, and in our names, to get us regularly confirmed executors,” &c. General powers were also given to him to recover all title-deeds, bonds, bills, &c.; to uplift all debts, and to discharge all accounts; “with power also to the said James Heriot to take all necessary steps for bringing the whole property, as well heritable as moveable, conveyed to us by the said trust-disposition, to sale,—he taking our instructions for that purpose from us, from time to time, with power to him from the funds recovered, to pay regularly the whole annuities left by the defunct; as also, when the whole funds are realized, to pay the different legacies left by him: And we hereby declare, that all and every thing relating to the premises, done and transacted by our said factor, shall be as valid and effectual as if done by ourselves.”

A reduction of the trust-deed was brought by the heirs-at-law, from which the trustees were assoilzied. During this period, the balance in the hands of Heriot was inconsiderable. Afterwards, certain lands were sold at a price of £24,850, and other trust-funds were realized, which were said to increase that amount of intromission to £35,938. The requisite deeds for effecting these sales were signed by all the trustees, and, in general, they subscribed the deeds necessary for following out the trust. As the sums realized were not sufficient, after payment of the debts, to satisfy the various legacies and provisions, a multiplepoinding was brought by the trustees in 1824, for the purpose of distributing the trust-estate. In this process, Lieutenant-General Ainslie, and the Earl of Traquair's Trustees, were Called as parties, in respect of their being legatees. In the course of the process, the accounts of Heriot, who alone had passed any of the trust-funds through his hands, were examined by an accountant, who reported, that an interim-payment of £11,696 might be made to the various claimants, setting apart, however, £2550 of this sum, until a question of preference should be determined. The trustees craved authority to make the interim-payments suggested, which the Lord Ordinary granted, and payment was made accordingly. This took place in 1824, and in 1828, a second report was made by the accountant, after again examining the factor's accounts. This report stated, that the balance in the factor's hands, as at 31st December, 1827, was £5632; and it suggested what sums could now be paid, under a second interim-payment, and what sum (£1237) should be set apart until the issue of a pending legal question. The Lord Ordinary, on the application of the trustees, sanctioned the proposed payments, and they accordingly were made. During all these proceedings, no party moved to have any part of the trust-funds consigned or secured. Heriot was reputed to be perfectly solvent. He had, however, not kept a regular account at the Bank on account of the trust-estate, as desired by the minute already quoted; and, after a third report had been lodged in process by the accountant, he suddenly failed, having £6146 of the trust-funds in his hands.