Scottish Court of Session Decisions

The petitioner was appointed judicial factor in 1861 upon the trust-estate of the deceased Mrs Isabella Potts, who died on January 17, 1826.

By her trust-deed Mrs Potts left certain legacies, and over the residue of her estate she created a series of liferents to the heirs of certain parties, so long as any of them should exist. Since the death of Mrs Potts these heirs had increased so much in number that the trust threatened to become unworkable from the gradual diminution of the shares of the liferent payable to each beneficiary, though the total sum liferented was of considerable amount. Under these circumstances the factor felt it to be his duty to apply to Parliament for a Private Act enabling the trust to be wound up. In course of doing so he incurred an expense of £81, 17s. 8d., and the attempt ultimately proved abortive.

In the present petition for interim audit of his accounts, the accountant (Mr William Moncreiff) drew the attention of the Lord Ordinary to the circumstances in which this account of expenses had been incurred, in the following terms:—“In the year 1869, in consequence of the difficulties in the management of the trust, arising from the gradually increasing numbers of the beneficiaries, and the very small amount of the shares of annual income payable to each, the judicial factor, by desire of some of the beneficiaries, instituted proceedings for obtaining an Act of Parliament authorising the trust to be wound up and the funds divided. These proceedings fell through from the whole of the beneficiaries not consenting, or rather omitting to intimate their concurrence, in the application as required by Parliament, but certain expenses were incurred, amounting to £81,17s. 8d., which have been stated in the factor's accounts as a charge against capital. As the judicial factor took these proceedings on his own responsibility, without having obtained special powers from the Court, the accountant has thought it right to report the circumstances, in order that the Lord Ordinary may judge whether the above sum of expenses ought to be sustained and sanctioned. In reference to this the factor explains:—Before the application was made to Parliament for an Act, the opinion of counsel was taken by the factor, and counsel advised that the factor should not apply to the Court for special powers, as in his opinion the Court could not be expected to sanction the winding up of the trust by giving the fee to the liferenters, and thus acting in a way not authorised by the trust-deed; but he recommended that, with the concurrence of some of the beneficiaries who were in receipt of the larger annuities, the factor should apply to Parliament, and he thought that the provision in the 17th section of the Entail Amendment Act, 31 and 32 Vict. c. 84, preventing the creation of a series of liferents, would justify Parliament in passing a similar Act in this particular case. The section of the statute referred to would have enabled the trust to be wound up if the trust deed had been executed after the passing of that Act. The factor accordingly, in conformity with the advice of counsel, made application to Parliament for an Act, but, as before stated, the proceeding had to be abandoned in consequence of the consent of the whole of the beneficiaries not having been obtained.”

The Lord Ordinary ( Mackenzie), in approving the petitioner's accounts, disallowed the above sum of £81, 17s. 8d.

Against this the petitioner reclaimed.

Shand and Brand for him.

At advising—