Scottish Court of Session Decisions

This was an action at the instance of John Nisbet, salt merchant, Glasgow, against Alexander Smith, commission agent there. The pursuer concluded for implement of a contract of sale entered into on 24th March 1875, whereby the defender agreed to buy, and the pursuer to sell, “Jane Villa,” and the ground on which it stood at Pollockshaws, the ground being in extent about an acre, and forming part of a plot of ground 6 1 2 acres in extent, originally feued by Sir John Maxwell of Pollock to James Connell at a feu of £32, 19s., and of which 3 1 2 acres were subsequently disponed by Connell under a ground-annual charge of £14, of which 3 1 2 acaes the acre upon which ‘Jane Villa’ stood formed a part. Further, the summons concluded for relief from the contract in event of non-implement by the defender's failure to pay £1200 to the pursuer, with reservation of the pursuer's claims for damages. The pursuers averred that since his purchase of the property in 1866 he had paid £5 feu-duty and £4 ground-annual yearly, and that in March 1875 he advertised the villa for sale in the following terms:—“To be sold by public roup, in the Faculty Hall, St George's Place, Glasgow, on Wednesday, 31st March 1875, that villa known as Jane Villa,

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Kennishead, near Glasgow, and situated about three minutes' walk from the railway station. It contains dining-room, drawing-room, parlour, three bed-rooms, kitchen, bath-room, and W.-C. The villa is supplied with gravitation water. There is considerable accommodation outside, including tool-house, &c. The villa has a southern exposure. The ground is thoroughly drained, and extends to one imperial acre. There is a flower garden, beautifully laid out; also a kitchen garden, fully stocked with berry bushes and fruit trees. Everything in the best order. Feu-duty, £9. For further particulars apply to W. R. Buchan, writer, 112 West Regent Street, Glasgow, in whose hands are the title-deeds and articles of roup.”

After one or two meetings between the pursuer and defender, the defender made this offer to the pursuer on 24th March 1875—“I hereby make you the offer of Twelve hundred pounds for ‘Jane Villa,’ at Kinnishead, as advertised—possession at Whitsunday 1875.” This was eo die accepted as follows by Mr Nisbet—“Your offer of Twelve hundred pounds for ‘Jane Villa,’ &c., as advertised by me, I hereby accept.”

Thereafter the agent for the pursuer sent his title-deeds to the defender's agents, and a draft-disposition was prepared by them and revised by the pursuer's agent. The defenders, however, refused to go on with the transaction, alleging that the pursuer, although repeatedly required, refuses to get the feu-duty and ground-annual above referred to, or either of them, allocated, so as to limit the amount for which the property in question shall be liable to £9 per annum, or to take any steps for that object, or to insert a clause in the disposition warranting the defender against the ultimate payment of a larger sum than £9 per annum.

It was admitted that the defender was allowed to enter at Whitsunday 1875, and that he had since lived in the villa.

The pursuer pleaded, inter alia—“(1) The defender having entered into a contract for the purchase of the subjects above mentioned, he is bound to implement and fulfil the same by making payment of the price, and accepting of a disposition from the pursuer. (2) The defender having, on the faith of his implementing the said contract, been allowed to enter into possession of said subjects, he is bound to pay the price with interest and accept the disposition. (3) In the event of the defender failing so to do within such time as the Court shall direct, the pursuer will be entitled to decree of declarator that the contract is no longer operative or binding on the pursuer, and otherwise as concluded for. (4) The pursuer, in respect of the facts above set forth, and of the legal rights and liabilities of the parties in the premises, is entitled to decree in terms of the conclusions of the summons.”

The defender pleaded, inter alia—“(2) The pursuer is bound in the circumstances stated to obtain an allocation of the gross feu-duty and ground-annual, or to insert a clause in the disposition in such terms as to limit the annual sum ultimately affecting the property in question to £9, and to get the deed referred to sufficiently stamped. (3) The defender having always been ready to fulfil his part of the contract on the pursuer's implementing the obligations incumbent on him, the defender ought to be assoilzied.”

The Lord Ordinary pronounced the following interlocutor and note:—

“ Edinburgh, 5 th January 1876.—The Lord Ordinary, &c.… Primo—Finds that it is admitted (1) That the plot or area of ground libelled, which belongs to the pursuer, is part of subjects of greater extent which are burdened with a cumulo feu-duty of £32, 19s. per annum, and a duplicand thereof every nineteenth year, payable to the superior, and with a ground-annual of £14 per annum, with a duplication of the like amount every nineteenth year; (2) That there has been no allocation by the superior or the party in right of said ground-annual of any proportion of said feu-duty and ground-annual upon the plot or area of ground libelled; (3) That the pursuer in March 1875 advertised for sale the said plot or area of ground which is now known as ‘Jane Villa,’ and in his advertisement stated the feu-duty to be £9; (4) That by missive offer and acceptance, both dated 24th March 1875, the defender offered to purchase, and the pursuer agreed to sell to the defender, the said subjects as advertised by the pursuer, at the price of £1200 sterling, with entry at Whitsunday 1875: Secundo—Finds that the said offer and acceptance imply that the defender as purchaser, should for the said price to be paid by him acquire and hold the said plot or area of ground subject to no feu-duty or ground-annual payable to any person, greater than the said annual sum of £9, and therefore that the pursuer is bound to convey the same to the defender freed from the burden of all feu-duties and ground-annuals in excess of said annual sum of £9, or secured against the effect of liability for such feu-duties and ground-annuals: Tertio—Finds that the defender is willing to implement his part of the transaction, provided the said cumulo feu-duty and ground-annual are to the extent of £9 allocated upon said area or plot of ground by the superior and party in right of the ground-annual, or provided the pursuer shall in the disposition to be granted by him warrant the defender against the ultimate payment of a larger sum than £9 per annum; and before further answer appoints the cause to be enrolled that the pursuer may state in what manner he proposes to implement his obligation in reference to said feu-duty and ground annual: Meantime reserves all questions of expenses.

Note.—The circumstances in which this action has been raised are fully explained by the findings in the first branch of the foregoing interlocutor. The defender in purchasing the subjects plainly relied on the pursuer's statement in the advertisement that the feu-duty was £9; and he is not said to have known that this was an unallocated part of a cumulo feu-duty and ground-annual of £46, 19s. which affected the entire subjects of which the plot or area purchased forms a part. Indeed, the pursuer himself avers that the defender made his offer without either seeing the titles or applying for information to the pursuer's agents, to whom reference was made in the advertisement. The pursuer, however, maintains that the defender is bound to accept a disposition of the lands without any allocation of the feu-duty and ground-annual being made, or without any obligation being

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granted by the pursuer to relieve him of the surplus feu-duty and ground-annual, and that if the defender refuses to accept such a disposition the bargain must be cancelled. I am of opinion that none of the pursuer's contentions can be sustained. The statement in the advertisement was, in my opinion, a warranty by the pursuer either that the subjects were free from all annual prestation, such as feu-duty or ground-annual, except to the extent of £9 per annum, or that he (the pursuer) would free them of all such liability beyond that sum. And I am further of opinion that the pursuer is not entitled to have the contract cancelled. He has not stated any relevant case to support such a demand; and his own statement of the transaction between him and the defender implies that by the offer and acceptance he became bound to hand over to the defender ‘Jane Villa’ free from all feu-duty, &c., beyond £9. And the pursuer is bound to implement that obligation either by obtaining a proper allocation of the feu-duty and ground-annual before the defender pays the price, or by inserting in the disposition a proper clause of relief. The defender is willing to settle the transaction on either footing, and if an allocation cannot be procured he will be content with the insertion in the disposition of a clause binding the pursuer and his representatives in warrandice against the ultimate payment of a larger sum than £9 per annum. This I think a most reasonable proposal; and the case is ordered to be enrolled that the pursuer may state which alternative he proposes to adopt. The present case is in all material points ruled by the decision in Paton v. Stuart, 11th March 1825, 3 Sh. 457. No question has been raised by the parties, or can, in my opinion, properly arise between them in reference to the duplication of the cumulo feu-duty and ground-annual. The defender must be held to have purchased the subjects on the footing that they were liable to the casualty of composition either taxed or untaxed, and it will remain for him to arrange, after the disposition is finally completed and delivered, for the allocation of the said duplications if he can prevail upon the superior and party in right of the ground-annual to make the same.”

The pursuer reclaimed, and argued—There is a difference between a representation inducing the terms of a contract and one not an essential of it—[Lord Justice-Clerk—If a bargain is induced by fraud or misrepresentation, the party deceived can either hold the article and claim damages, or reject it and put an end to the bargain]— Mackenzie, 3 Paton, App. 378; Gilmore v. Hart, 2d December 1875, 13 Scot. Law Rep. 105.

Argued for the defender—The defender is entitled either to a disposition securing him against paying above £9 feu-duty, or to get the whole feu-duty allocated over the whole property. What is the contract? The seller had complete knowledge, and so was bound to be distinct. The natural construction of the advertisement is that he named £9 as the maximum of the feu-duty. There is no statement on record by the pursuer that he cannot fulfil his contract. Authority— Paton v. Stuart, 11th March 1825, 3 S. 457, and Lord Ordinary's note there.

At advising—