Scottish Court of Session Decisions

This was a note of suspension and interdict for Edward Averil Lucas, Charles David Lucas, and Lady Elizabeth Lucas or Beresford, trustees of the late Sir George de la Poer Beresfprd, against

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James Gardner, residing at Laroch House, Ballachulish, in the following circumstances:—

In 1861 Sir George Beresford purchased the lands and estate of Ballachulish, inclusive of the slate quarries upon the estate, and some years afterwards he executed a deed of directions and declaration of trust in favour of the present complainers, assigning to them his whole interest in the property for certain purposes named. They entered into possession in May 1873, and in order to pay off a debt of about £50,000 upon the estate, they procured, through Mr George Gardner, writer in Glasgow, two loans on the security of the estate—one of £10,000, and the other of £8000. Other claims were, however, made, and to pay these Mr George Gardner offered to get a loan from his father James Gardner, the respondent, of £6500, at 6 per cent. The offer was accepted, and the complainers thereafter signed an ex facie absolute disposition of the estate, dated 26th May 1873, in favour of the respondent, of the nature of which they alleged they were not then aware. This disposition was qualified by a minute of agreement between the parties, dated the 26th May and 4th June in the same year, which was also signed by the complainers without, as they stated, their being aware of its contents. By that minute of agreement it was, inter alia, declared—“ First, That the said disposition was granted in security and for repayment of said sum of £6500, interest, and consequents, and of all other sums for which the second party might become liable on account of, or advance to, said trustees; and on the same being paid to him, or his being fully relieved thereof, and of all relative expenses, that he should reconvey the said lands, quarries, and others to the complainers under burden of the existing securities thereon, viz.—£40,000 and £8000. Second, That in the event of the complainers failing to pay and relieve as aforesaid, upon the respondent giving them or George Gardner, writer in Glasgow, their agent, one month's previous notice that he desired payment or relief, he should be entitled to sell the said quarries and others by public roup or private bargain in Glasgow or Edinburgh, under burden of said existing securities, and should account for and pay over to the complainers the free residue of the price after full settlement of his own claims and the expenses of and incident to the sale.” It afterwards appeared that the £6500 had been borrowed upon three bills from the City of Glasgow Bank, to which George Gardner procured the signature of the complainers.

The complainers stated that after the execution of these documents the respondent applied to Lady Beresford for a lease of fifteen years of the Ballachulish slate quarries—the lease of the existing tenant expiring at Whitsunday 1874,—and that Lady Beresford agreed to give it, upon the stipulation that it was to be on similar terms with the preceding one. The lease as drawn up was in very different terms from the previous one, but in ignorance that this was the case it was signed. Although George Gardner had been appointed by the complainers their factor and commissioner, it was stated that he had become very neglectful of their business, and that representations to that effect had been made to his father, who with his son John (as the former admitted in his answers) agreed to attend to any duties belonging to his son connected with the estate. But George Gardner's neglect became so great that his appointment was recalled in March 1876, and the new factor then appointed had been unable to obtain from the respondent any proper state of his accounts.

The true nature of the documents signed by the complainers was then made known to them, and after much difficulty the factor, in August 1876, obtained from the respondent an account bringing out a sum of £9424, 6s. 9d. as due by the complainers. On 16th September the complainers received an intimation from the respondent requiring payment of that sum, and stating that if not paid within a month from that date he would proceed to sell the lands and estate, under the second head of the agreement above mentioned. The complainers accordingly brought this note to have these proceedings suspended and the sale interdicted, but stated their willingness to pay any balance that might be found due to the respondent. They averred that the respondent and his son had been acting throughout in collusion, and explained that they were about to raise an action against George Gardner to compel an accounting with him, and another action of reduction of the lease.

With reference to the account of £9424, 6s. 9d., they averred, inter alia—“This amount consists only to the extent of two sums of £2619, 13s. 3d. and £1112, 9s. 10d., of payments alleged to have been made by the respondent to the City of Glasgow Bank in respect of the said £6500 debt (the remainder of the said debt having been paid by the said George Gardner, the complainer's factor, on their behalf), and the balance of the said £9424, 6s. 9d., consisting of a great variety of miscellaneous charges and alleged payments, many of which ought to have been made, and which the complainers believe were made, by George Gardner, their agent and factor, out of moneys belonging to them which came into his hands, and which will form entries to his credit in his accounts with them, but with which the respondent had no concern, unless he may have paid them as acting on behalf of his son George as above mentioned, and which do not form proper items of credit in his accounts with the complainers, and were not covered by the foresaid security. Further, in the portion of the accounts relative to the said quarries, the complainers are improperly debited with very large sums, whereby the apparent profits of the quarries are reduced to a very small amount; and the said accounts contain many charges which, even assuming them to be legitimate entries therein (contrary to the complainers' contention), are not properly vouched. The complainers believe and aver that upon a just accounting, if any balance at all is due by them to the respondent, which they do not admit, it will be of very small amount.”

The respondent answered that the statement of accounts which he produced showed “the advances made by him to and on behalf of the complainers from September 10, 1873, to May 15, 1876, state of interest on the said advances, and the sums at the credit of the complainers in respect of their claims under the lease. Besides the advances, the complainers are indebted to the respondent in the sum of £68, 12s. Id. for goods supplied to Sir George Beresford between

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17th December 1872 and 20th July 1873. The whole amount of the said advances, account for goods, and interest, is £12,796, 8s. 7d., from which there falls to be deducted the sum of £3572, Is. 10d., as shown in the said statement. No part of the said advances, or of the said account, has been paid by the complainers, and the sum now due and resting-owing by them to the respondent is £9424, 6s. 9d.”

The complainers pleaded, inter alia—“(1) The complainers are entitled to have the proposed sale interdicted, in respect that the sum claimed by the respondent is not truly due, and that they have all along been, and still are, ready and willing to settle accounts with him, and pay any balance which may be found due. (2) The respondent having, in the matters above mentioned, been acting in collusion with the said George Gardner, adversely to the complainers' interests, and having by the said actings created or attempted to create improper charges against- the complainers, and deprived them of the means of speedily settling accounts, they are entitled to have suspension and interdict as craved.”

The respondent pleaded, inter alia—“(1) The respondent being infeft in the lands and others described in the note of suspension, under an absolute disposition, is entitled to sell and dispose of the same under burden of the existing securities, he being always liable to account to the complainers, in terms of the minute of agreement, for the residue of the price after full settlement of his claims against them, and under deduction of the expenses incident to the sale. (2) The complainers being absolutely divested of the said subjects, have no right or title to interfere with the sale thereof by the respondent, except on condition of making full payment of the whole sums due to him, as set forth in the foregoing statement, and that within one month from the 16th September 1876, in terms of the said minute of agreement.”

The Lord Ordinary, on caution, passed the note of suspension.

The complainers reclaimed.

At advising—