Scottish Court of Session Decisions

This is all action at the instance of Robert Wale lace, lately hotel-keeper in Lybster, now residing in Edinburgh, against James Henderson, of the firm of James Henderson & Co., distillers, Pulteneytown, Wick. The summons concluded for payment of £2000 of damages, and also for count and reckoning in regard to the defender's intromissions with the rents of certain heritable subjects in Lybster, of which the pursuer was heritable proprietor. The question before the Court had reference only to the relevancy of the pursuer's averments to entitle him to claim damages. The material averments were—

“Cond. 2. In the said year 1859, the pursuer was desirous of enlarging his premises, and of adding to his business some dealings in the coal trade, for which there was at that time an excellent opening. He mentioned the matter to the defender, who agreed to make advances to him to the amount of £200 or thereby, on condition that there should be assigned to him a bond and disposition in security over the said subjects for £350, bearing date the 16th March 1853, granted by the pursuer and his said wife in favour of Mr Robert Sutherland, residing in the village of Latheron-wheel. It was understood and agreed, however, as a part of the arrangement, that this security should not be called up or enforced without implement by the defender of his agreement to make advances.

Cond. 3. Acting in reliance upon this agreement by the defender, the pursuer arranged with Mr Sutherland for a transfer to the defender of the said bond and disposition in security for £350. Accordingly it was assigned to him on 21st November 1859. This assignation was obtained by the defender on the faith of the foresaid agreement, and on the footing that the debt was not to he called up, or the security enforced without implement by the defender of his foresaid agreement.

Cond. 4. Shortly thereafter, the defender, professing to act in pursuance of the said agreement, prevailed upon the pursuer and his wife to execute in his favour a bond and disposition in security which was prepared by the defender's agent, whereby, on the narrative that they were already indebted to him in a sum of £70 sterling, or thereby, for cash advanced and goods furnished to them by the defender's company, and that he had also agreed to credit the pursuer from time to time for cash and goods to be advanced and furnished, and that they were desirous of giving him security for the same, they bound and obliged themselves, and their heirs, executors, and representatives, whomsoever, to make payment to the defender, the said James Henderson, and his heirs and assignees whomsoever, of the sum of £200, or such part thereof as might be found in manner thereinafter mentioned to be due by the pursuer, the said Robert Wallace, to the said James Henderson & Company, or the said James Henderson, for cash and furnishings already advanced or made, or which night thereafter be advanced or made, by the said James Henderson & Company, or James Henderson, to the said Robert Wallace, or for which the said James Henderson & Company or James Henderson might be engaged or liable on his account in any manner of way, and that within three months after the date at which payment of the same should have been demanded, with the due and lawful interest thereof from the respective dates of advance till repayment, and a fifth part more of the said sum of liquidate penalty in case of failure in punctual payment, and so proportionally for any less sum that may be due. And in further security of the personal obligation before written, the said Robert Wallace and the said

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Marjory Miller or Wallace, disponed to and in favour of the said James Henderson and his foresaids, heritably but redeemably, as thereinafter mentioned, yet irredeemably in the event of a sale by virtue thereof, the foresaid subjects; and that in real security to the said James Henderson and his foresaids of the whole sums of money and advances above written, principal, interest, and penalties.

Cond. 6. In beach of the verbal agreement entered into by him as aforesaid, and also in violation of the agreement expressed in the bond above recited, the defender most wrongfully and injuriously failed and refused to make advances in cash to the pursuer to the amount stipulated, and he also failed and refused most wrongfully and injuriously to furnish him with goods on credit to the amount stipulated. He refused to make any advances. He insisted on receiving, and by threats and intimidation induced the pursuer (who is a person entirely unskilled in law business) to give various payments to account of the sum of £70, stated in the foresaid bond to be due for goods, and in all his subsequent dealings with the pursuer he required, and by the same means obtained present payments for all nods furnished by him. The pursuer frequently desired and required the defender to make advances to him in cash and goods to the amount of £200 or thereby, in terms of the agreement, but the defender most wrongfully and injuriously refused to make any advance, and in farther breach of his agreement proceeded, on or about 4th May 1861, to call up the foresaid bond for £350, under a threat that if not paid within three months, he would, without further intimation or other process of law, proceed to sell the subjects conveyed in security, and which formed the only property and means of livelihood possessed by the pursuer.”

The pursuer also alleged that he had been thus concussed by the defender into ceding possession of the subjects to him, and that he had sustained serious loss and damage by reason of the defender's actings.

The defender denied the pursuer's averments, and pleaded that they were irrelevant. He explained that he had received the assignation to the bond for £350 from Sutherland, on paying to him £367, 19s. 7d., as principal and interest due thereon, and £4, 16s. 5d. of expenses.

The pursuer proposed the following issues:—

1. “1. Whether, in or about November 1859, or during the preceding months of said year, the defender undertook and agreed to make advances to the pursuer in cash and goods to the amount of £200 or thereby, and whether the defender, in breach of the said agreement, failed to make advances to the said amount—to the loss, injury, and damage of the pursuer?”

Damages £1000.

1. 2. Whether, in or about November 1859, or during the preceding months of said year, the defender undertook and agreed to make advances to the pursuer in cash and-nods to the amount of £200 or thereby, and obtained, on the faith of such agreement, and as a security not to be put in force without implement of the same, the bond and disposition in security, No. 12 of process, and an assignation to a prior bond and disposition in security for £350 over the same; and whether, in or about May 1861, the defender, without having implemented the said agreement, wrongfully called up the sum contained in the earlier bond and disposition in security, and caused the pursuer to give up possession of the said subjects-to the loss, injury, and damage of the pursuer?”

Damages, £1000.

The Lord Ordinary (Kinloch) reported the case with the following

“ Note.—The defender objects that the action is not relevantly laid, and that, therefore, the pursuer is not entitled to any issue.

The action is laid on an allegation that the defender agreed to lend a certain sum or sums to the pursuer, and failed to do so, in consequence of which it is said that the pursuer suffered loss in his business. It is also alleged that the defender agreed not to call up the sum in a bond held by him over the pursuer's property till the stipulated advances were made, and, in violation of the agreement, put the bond in force, to the pursuer's further damage.

The leaning of the Lord Ordinary's mind is to concur with the defender in considering the action in laid.

It is possible to conceive a case in which a person agrees to advance a sum for the purpose of effecting a particular object, as for instance the payment of a pressing debt cine on a particular day, and in which failure to advance the money may infer a liability for some special and direct damage arising in consequence. But no case of the kind appears set forth in the present action. The alleged agreement is ‘to credit the pursuer from time to time for cash and goods to be advanced and furnished.’ This can scarcely be held an absolute obligation, prestable in all circumstances, but rather the intimation of a purpose which the proposed lender could carry out or stop fulfilling as he might find expedient. Besides, a mere allegation of general damage to business and circumstances does not infer that direct and special consequence which would be necessary to support such a claim.

There is equally little ground laid for claiming damages against a creditor who enforced a just debt after the term of payment. Indeed, this branch of the case is made to hang wholly on the other. The pursuer only represents the enforcement of the debt to be culpable, because it took place without previous fulfilment of the alleged obligation to make additional advances.

“W. P.”

Lee ( Lord Advocate with and W. F. Hunter him) was heard for the pursuer.

Rutherfurd Clark and Macdonald, for the defender, were not called on.