Scottish Court of Session Decisions

Subject_1Bill
Subject_2Suspension
Subject_3Partner. Headnote:

Suspension of a charge on a bill on the grounds—(1) that it was granted for the charger's accommodation; (2) that it was granted by one partner to another, for the purpose of raising money for the business of the copartnery; and (3) that the charger had agreed not to use diligence on the bill— refused.

This is a suspension of a charge upon a bill. In the year 1862 the suspender became a partner with the respondent in an iron foundry business, but having nothing to put into the capital of the business, and it being necessary to raise money for the company's concerns, he accepted a bill for £717, 10s., which was drawn upon him by the respondent, as the share of the stock which he contributed to the company. Part of the bill was paid by the suspender, and the charge was made for payment of the unpaid balance. The grounds of suspension maintained were—(1) That, assuming the suspender to be due a balance on the bill, he was not liable to diligence therefor, in respect that the bill was an accommodation one, which was truly accepted for the benefit of the respondent; (2) that a member of a joint adventure or partnership concern is not entitled to use summary diligence against a copartner for any balance of copartnery funds while the state of the affairs of the concern is not ascertained, according to the rights of parties; and (3) that the diligence was contrary to the agreement of parties, by which the complainer was to liquidate his obligation only as he was able. The Lord Ordinary on the Bills passed the note, and liberated the suspender from prison, giving effect to his plea, that the understanding between him and the respondent was that he was only to be called upon to pay as he got up his money to do so, and also to the plea founded on the yet unascertained rights of parties. To-day the Court recalled this interlocutor, and remitted to the Lord Ordinary to refuse the note. The Court were of opinion that the first defence, which could only be proved by the writ or oath of the respondents was not only not so proved, but was disproved by the writ of the suspender himself. The second defence was inapplicable to the facts of the case, the charge being for a remainder of debt, for the one-third of the property acquired by the suspender in 1862 for the company concern; and as to the third defence, there was no evidence of any such agreement as was alleged by the suspender.