Scottish Court of Session Decisions

Lord President—In this case we found by our interlocutor that the pursuer expended a sum of £16, 15s. in putting up sundry moveable fittings in premises occupied by him as tenant, and the defender undertook by the document which has been stamped at the pursuer's expense to repay him that sum on his removal. Subsequently, the defender having become bankrupt, the premises came to be sold, and were purchased by the pursuer, and at the time of the sale nothing was said about this sum of money. The effect of that we held to be that this obligation had been departed from, and was no longer of any avail. That was the result of the case, but in the course of supporting his case the pursuer found himself met with this objection, that the document on which he founded was not stamped, and he was put to the expense of the penalty and the stamp. He says now that he is entitled to get one-half of that from the defenders, as this was a mutual agreement.

The point is quite settled that where the document is one on which both parties require to found, and the party leading it in evidence is made to pay the duty and the penalty, he will be entitled to recover half of that from the opposite party. But I am not satisfied that where an obligation of this kind is founded on by one only of the parties, and found to be worth nothing, then that party should be entitled to recover half the duty and half the penalty from the other party—the other party is quite entitled to say, “You should never have founded on this. I did not do so. You see the consequences of having done so, and you must bear them.” Now, by our judgment this agreement is found to be a worthless piece of paper, and I do not see how that answer is to be met.

There is one case certainly whose principle I have had a little difficulty in reconciling with our present decision. In the cases of Neil v. Leslie and M'Douall v. Caird the common rule is applied; but there is another case where the principle is not so clear. I mean the case of Logan v. Ellice, Mar. 6, 1850, 12 D. 841. That was a case laid upon a mutual contract in which the pursuer concluded for £692; the defender tendered £205 as the sum due under the contract; the pursuer got a verdict, but only for £181, being £24 under the tender; the consequence was that the defender was found entitled to expenses after the date of the tender. The difficulty that arose was as to the cost of stamping the contract; that had not been done till the trial, long after the tender was made, and therefore the defender contended that he could not be held liable for any part of the expense of stamping it.

The Court, however, proceeded there on the footing that that was a writing on which both parties founded in the course of the case, and the Lord President says—“There is nothing to prevent our following the fair and reasonable rule, that where a mutual instrument is founded on by both parties, they should divide the expense of stamping it.” That being the ground of the judgment in that case, it cannot be held to apply to this.

I should add that this judgment is given in accordance with the opinions of the Judges of the Second Division, whom we have consulted.

Lord Deas—The case of Logan v. Ellice was a case of mutual contract; the whole question was, how much was due under it; but both parties founded on it. The law is very correctly laid down by your Lordship in the case of Neil v. Leslie. What I added there was that when a document is produced by a party to us we should order it to be stamped at his expense, leaving it to be determined afterwards who is to be liable finally.

Lord Mure and Lord Shand concurred.