Scottish Court of Session Decisions

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Page: 238↓

016SS0238

Earl of Buchan
No. 56.

Court of Session

1st Division

Dec. 16 1837

Lord President, Lord Mackenzie, Lord Gillies, Lord Corehouse.

Henry David Earl of Buchan and Others (Tutors of Lord Card-ross), Petitioners.— Counsel:
Marshall.

Subject_Provision to Children—Aliment—Tutor—Entail.— Headnote:

A boy of four years of age was next heir of entail to an earldom, and to an estate yielding between £5000 and £6000 per annum; he was grandson of the earl, by a deceased son; and was in absolute destitution: The Court granted authority to his tutors to transact with a reversionary insurance office both for the purchase of an annuity of £200, for his maintenance and education during pupilarity, and also for an immediate advance of £500, to pay debts and expenses already incurred; and to grant a security for the equivalent capital sums, or annuities, required by the insurance-office, over the rents of the entailed estates, which should become payable after the boy's succession to them.

Facts:

On the death of Lord Cardross, eldest son of Henry David Earl of Buchan, he left a widow, and two sons and a daughter, in pupillarity, the eldest son, Harry Shipley Erskine, being about four years of age. Lady Cardross and her family were in a state of absolute destitution, and, in consequence of the embarrassments of Lord Buchan, and the diligence of his creditors, it was not in his Lordship's power to render any assistance whatever towards their maintenance. Lord Buchan and others, who had been appointed tutors to the children, presented a petition to the Court, stating these circumstances, and that the eldest son was heir of entail, after the death of his grandfather, Lord Buchan, to the estates of Strabrock and others, yielding between £4000 and £5000 per annum; and, on the death of Sir David Erskine of Dry burgh, and of Lord Buchan, to the estate of Dryburgh, worth about £900 per annum; that the rental to which the pupil would succeed, though liable to be affected for a time, by certain contingencies, and particularly the effect of a trust-deed, then under reduction, would still be about £2000; that some inevitable expenses had been already incurred in the tutorial management, which required to be paid; and, in consideration of the rank, station, and prospects of the pupil, the petitioners craved the Court “to authorize the petitioners to raise a sum of money to pay the debts above mentioned, and to defray the expense of their tutorial management, to purchase an annuity for the purpose of maintaining and educating the said Harry Shipley Erskine during the period of his expectancy, at a price payable upon his accession to the title and estates by the death of his grandfather, in case he shall survive him, or to grant a reversionary annuity, to become payable during the life of the minor after his accession to the title and estates, and to assign the future rents of the entailed estates of Strabrock and others from the period of the succession opening to the minor.” The petitioners referred to the recent case of Miller, as being on all-fours with this. ¹

Before the petition was disposed of, Sir David Erskine died.

The Court remitted successively to two accountants to report as to the best terms on which money might be raised, upon such security as the petitioners could alone offer. Two successive reports were returned, which explained that transactions of this nature were always the subject of special bargain, and that the amount which would actually be required by a reversionary insurance-office, in this particular case, could only be ascertained by making an offer; but that, from both of their calculations, the results stated might be relied on as giving the fair and reasonable equivalent which an insurance-office would require for its advances. The report stated alternatively the price for which an insurance-office would make advances, 1st, If these were to be repaid by the payment of a slump
_________________ Footnote _________________

¹ No. 26, 1836 (ante XV. 147).

sum, within six months after the pupil's succession to the estate; or, 2d, If the repayment was to consist of an annuity payable during the lifetime of the pupil, after succeeding to the estates; and such repayment being, in either case, secured by an assignation to the future rents of the estates. The report also stated what equivalent would be required for making an advance of annuity to the pupil during pupilarity only; or during the whole of minority; or during the whole duration of the joint lives of the pupil and Lord Buchan. In particular, it was stated that an immediate sum of £400 required to be raised to pay off debts; for which the equivalent required by a reversionary office would either be a slump sum of £1076, 16s., payable in six months after the pupil's succession; or an annuity of £78, 8s. 4d., payable during his lifetime, after his succession. And that to raise an annuity of £200 during the ten remaining years of the pupilarity of Lord Cardross, would require either the ultimate payment, as above, of a slump sum of £4069, 8s. 10d., or an annuity as above of £296, 6s. l0d. The report farther called the attention of the Court to this circumstance, that, on the one hand, if an annuity was provided now, for the minority as well as the pupilarity, of the child, it would be obtained at a cheaper rate, so far as regarded the minority, than it could be, if the pupilarity alone were now provided for, and the minority left to be provided for when the child reached 14 years of age; but that, on the other hand, if Lord Buchan should die during the next ten years, there would be no occasion to make any provision whatever, for the period of the child's minority.

It afterwards appeared that the amount of existing debts and expenses to be provided for by an immediate advance was £500.

Along with one of the reports, there was produced a letter from the Northern Reversion Company, agreeing to entertain the proposal, on the terms stated by the accountants, assuming the life of the pupil to be insurable, and that a security could be given over the future rents.

On considering this Report,

Lord President.—I do not think that we should authorize a provision at present for any period beyond that of the child's pupilarity. Lord Buchan may not survive that period, in which event all occasion for our interposition will be at an end. But when the period of pupilarity has expired, if a necessity still exists for the interposition of the Court, its authority will be interponed, on a due consideration of all the circumstances as then existing. But the Court should not now go beyond the term of pupilarity. I rather incline to think, however, that an annuity of £200 is too limited to answer the end in view. Considering the rank and prospects of the child; that the destitution of himself and his mother is absolute; and that any incidental circumstance, such as ill health, might necessarily occasion extra disbursements at any time, I fear that annuity is too limited. And if the child should fall into ill health, it will be observed, that the only means which the petitioners possess of raising funds will be destroyed, as no insurance-office would, in that event, lend money upon the chance of a sick child's survivorship. In all the circumstances, it might be worthy of consideration, whether we should not authorize a larger annual sum to be raised, and direct it to be vested in a trustee, who should not however be impowered to pay a larger annual sum than £200 without the special leave of the Court. That would afford a means of providing for extra disbursements when they may incidentally, but necessarily occur; and might be, generally, of benefit towards the due provision for the maintenance of the child.

Lord Mackenzie.—I am clearly of opinion that the Court cannot make provision at present for any period, but that of the child's pupilarity. That provision satisfies the present exigencies of the case, and we should do no more. I am doubtful, however, whether we should authorize any larger sum than £200 per annum to be raised, besides paying off the existing debts. There is a separate question as to the mode of raising it, whether, on condition of the payment of a slump sum, on the child's succession, or on condition of payment of an annuity during his lifetime after his succession. Perhaps we can only make a guess at the mode which is likely to be most advantageous and least burdensome to the pupil. But there are some grounds to aid in guiding us; the child, as heir of entail, will certainly succeed to a permanent income, though, for any thing that appears, he may not succeed to any capital sum whatever. And therefore, I rather apprehend that the equivalent to be given to the insurance-office should be by way of annuity, as likely to be least inconvenient to an heir of entail.

Lord Gillies.—I think it is the period of pupilarity for which the Court should now provide. And I concur in the observations of Lord Mackenzie as to the proper mode of raising it.

Lord Corehouse.—I doubt whether the Court can authorize a larger annuity than £200; and we ought not now to authorize any provision for a term beyond pupilarity. As to the mode of raising it, the question is, whether it will be least inconvenient for the pupil, on coming of age, to pay the capital sum, or the annuity, either of which is equally valuable to the insurance-office, being the price at which they undertake to make the same amount of advance. I am afraid it must be in some degree a matter of conjecture, on the part of the Court, which of these modes may eventually prove least burdensome to the pupil; but, on the grounds which hare been already stated, I incline to think that the Court should authorize the repayment to be made by way of annuity.

The Court pronounced this interlocutor:—“Grant warrant to and authorize the petitioners to transact with the Northern Reversion Company, or any other company, for the purchase of an annuity of £200, for the maintenance and education of the said Harry Shipley, Lord Cardross, during the period of his pupilarity, in consideration of their paying, for said annuity, a capital sum of £4069, 8s. 10., or, on their covenanting to pay an equivalent reversionary annuity of £269, 6s. 10d: Also grant warrant to, and authorize the petitioners to raise, by way of immediate advance, the sum of £500, for the purpose of paying debts incurred on account of the minor, including the expenses of this application and the transaction hereby authorized, with other contingent expenses, and that upon payment of the equivalent capital sum of £1292, 3s., or of an equivalent reversionary annuity of £94, 2s.; and to grant a security for the said capital sums and annuities over the rents of the entailed estates of Strabrock and others, which may become payable during the minor's life from and after the period of his succession to the said estates, and decern.”

Solicitors: W. Hornf, W.S.—Agent.

SS 16 SS 238 1837