Scottish Court of Session Decisions

This was an appeal from the Sheriff-court of Aberdeenshire in an action in which the appellant was convened for an alleged company debt of Aitken, Catto, & Co., of which the appellant was a partner along with two other parties. The other partners denied that the debt was a company debt; but the appellant, who had contracted it, admitted that it was so.

The Sheriff-substitute ( Comrie Thomson), in respect of that admission, decerned against the appellant.

The Sheriff ( Jameson) adhered. He added the following note:—“The action was properly brought against the company, and the individual partners thereof, for the price of a share of a barque alleged to have been purchased by them. Two of the defenders, John Catto and Robert Catto, denied that there had been any purchase by the company. The appellant, however, candidly admitted that the debt in question was a company debt. Had he not done so, his plea would have been good, that it was incumbent on the pursuer to constitute his claim against the company before he could obtain a decree against him. His admission supersedes the necessity of such constitution against him, and he cannot insist upon the pursuer carrying on a litigation with the copartners merely to facilitate his relief. He must take his own course for that object. This result is not inconsistent with the doctrine founded on by the appellant, and stated in 2 Bell Comm., p. 619.”

The appellant now appealed.

Clark and Asher, for him, pleaded that decree could not be given against an individual partner for a company debt, unless the decree in question was preceded or accompanied by a decree against the company as a company.

Watson and Thoms in answer.

The Court adhered to the judgment of the Sheriffs. Their Lordships ( dub. Lord Cowan) held that the rule that a company debt must be first constituted against the company was superseded in a question with an individual partner where that partner admitted the debt as due by the company. In a question with a partner so admitting, the debt was constituted against the company, and he, as a partner, was liable for the whole of it. If the appellant's view were adopted, the result would be that any one recalcitrant member of a company might prevent a creditor for an indefinite period from getting decree for a debt which all the other partners admitted.

The Sheriff-substitute's judgment in this case was dated 12th March 1869; that of the Sheriff was dated 14th April; and the appeal was brought into this Court on 18th May.