Scottish Court of Session Decisions

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Cite as: [1835] CA 13_827

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SCOTTISH_Shaw_Court_of_Session

Page: 827↓

Aberdeen Bank

v.

Maberly, &c. No. 250.

Court of Session

2d Division R.

May 22 1835

Lord Jeffrey

Aberdeen Banking Company, Suspenders— Keay— More. Maberley, Cane and Company, Chargers.— D. F. Hope— Sandford.

Subject_Foreign—Bill of Exchange.—

Circumstances in which the Court, while they directed the opinion of English counsel to be taken, before pronouncing judgment, in a question on a bill of exchange, arising out of transactions which had taken place in London, where the bill was payable, recalled a finding of the Lord Ordinary, “that the legal effect of the facts” which had been established “must be determined by the law of England.”

The suspenders, the Aberdeen Banking Company, on the 3d January, 1832, drew a bill, payable on the 16th, upon their correspondents in London, in favour of John Maberly and Company, a concern of which John Maberly was the sole partner, and which had a branch banking establishment in Aberdeen, but with their principal place of business in London. This bill was received in London by John Maberly and Company on the 6th, and, without being offered for acceptance, was indorsed by them, and delivered to one Bartley, a clerk in their banking-house, generally for the use of a concern called the Horse Bazaar, of which, as of the banking-house, John Maberly was the sole partner, and of which Bartley was the manager. Bartley thereafter indorsed the bill to the chargers, Maberly, Cane and Company, also of London, in payment of an account of less amount, due them by the Horse Bazaar, receiving from them a check on their bankers for the balance, which was applied in payment of certain other debts due by the bazaar. In the mean while, on the 2d of January, Maberly and Co. had stopped payment (though no commission of bankrupt was issued till the 28th), and Maberly, Cane and Co. were aware of the stoppage when they took the bill from Bartley. Owing to this stoppage two bills drawn by Maberly and Company, in favour of the Aberdeen Banking Company, in the preceding December, and which fell due on the 2d and 9th January respectively, were dishonoured and returned upon the bank, who thereby became the creditors of Maberly and Company, and whose correspondents in London in consequence refused to accept the draft by the bank in favour of Maberly and Company above-mentioned. On this, Maberly, Cane and Company, the holders of the draft, charged the bank, who brought a suspension, on the ground, that, in the circumstances, Maberly, Cane and Company were not entitled to the character of onerous indorsees. In this suspension an issue was sent to a jury, and of consent of parties a special verdict was taken, embodying the facts above detailed. On the motion to have it applied, Maberly, Cane and Company contended, that the bill being payable in London, and the whole transaction having taken place there, except the mere drawing of the bill, which could not in any way affect the question, the cause necessarily fell to be determined exclusively by the law of England. The bank, on the other hand, contended, that although the English law might properly be looked to as an authority, yet this being a question under the general law merchant, applicable equally to all countries, this Court should not bind itself absolutely in their determination of the cause by the rules of English law, as these might be given in evidence.

The Lord Ordinary pronounced this interlocutor, adding the subjoined note. ^*

_________________ Footnote _________________

^* “The Lord Ordinary has no doubt that this case (now reduced to a case of pure law) must be determined by the law of England. It relates entirely to the effect of the transference of a certain bill of exchange, from one London house to another, with reference to the circumstance of the original payees of the bill (being another London house) having previously stopped payment, and having soou thereafter had a commission of bankrupt (which, it is contended, had a retrospective operation) issued against them in London: That the legal effect of these circumstances must be judged of by the law of the country where they occurred, and where all the parties were domiciled, seems scarcely to admit of question; and though the previous procedure in the cause appears to have been taken on a different footing, the Lord Ordinary feels that he could not, with propriety, dispose of the case otherwise than as he has done, by the preceding interlocutor. It was very fully argued before him; and it is worthy of remark, that almost all the authorities cited by the Aberdeen Bank, when pressing for a decision on the merits, were authorities in the law of England. The only answer which the bank made to the necessity of putting that law in evidence (for they seemed to admit that the circumstance of the bill being drawn in Scotland was immaterial), was, that the question was one on the ‘law merchant,’ as they were pleased to term it, which, they contended, was the same all over the civilized (or mercantile) world; and to the application of which the Courts of all countries were therefore competent, where-ever the cause of action might have arisen. The Lord Ordinary, however, is not aware of any authority for this proposition; and it is matter of notoriety that there are great and important differences in the laws of adjoining countries, as to commercial contracts generally, and especially as to the rights of debtors and creditors, in questions as to bills of exchange, and the effects of bankruptcy and insolvency. Mr Bell's Commentaries, which relate almost entirely to questions in the law merchant, are full of notices of such discrepancies between the law of England and that of this country.”

“In respect that the whole of the facts established by that case occurred in England, and among parties exclusively subject to the jurisdiction of the English Courts, Finds, that the legal effect of the facts so established must be determined by the law of England; and, therefore, before farther answer, appoints the cause to be enrolled, that parties may be prepared to say in what manner they propose to put that law in evidence.”

The Bank having reclaimed,

The Court pronounced this interlocutor:—“Alter the interlocutor of the Lord Ordinary, in so far as it finds ‘that the legal effect of the facts so established must be determined by the law of England;’ and remit to his Lordship to ordain the parties to prepare and give in a special case on the facts embodied in the agreement of verdict, in order to be laid before English counsel for their opinion, on the points of English law arising thereon, and thereafter to proceed in the cause as to his Lordship shall seem fit.”

Solicitors: Walter Duthie, W.S.— Smith and Kinnear, W.S.—Agents.

SS 13 SS 827 1835