Scottish Court of Session Decisions

This was an action raised by the Waterworks Commissioners of Perth (under the Perth Water Act 1877) against Archibald M'Donald and others, Commissioners for supplying Perth with water (under the 1829 Act), and the conclusion of the summons was for count and reckoning under the following circumstances:—In 1829 the Act 10 Geo. IV. cap. 103, was passed, entitled “An Act for supplying the city of Perth and suburbs and vicinity thereof with water,” the object of which was to bring a sufficient supply of water into Perth, and to provide adequate funds for that purpose by an assessment upon the inhabitants. By the 5th section the permanent constitution of the board was determined, there being six Commissioners by virtue of their public offices, and twelve Commissioners elected, two of them by each of the six wards into which the town was divided for the purposes of the Act. The Act authorised the Commissioners acting under it to take lands and water, and to execute works in the manner and within limits specified. Power was also given to raise such sums as the Commissioners should deem sufficient to carry out the purposes of the Act by assessment on the owners and occupiers in possession of lands, tenements, and heritages within the city and suburbs. The 49th section provided that the Commissioners” shall have power, and are hereby authorised and empowered, to impose and levy, or ‘cause to be levied, the assessments hereinbefore authorised so and to such extent as thereby to raise a yearly revenue or income sufficient and adequate to defray the annual expense attending the establishment, supporting the works and erections thereof, and carrying into effect the purposes of this Act.” The 62d section enacted “that the expenses of preparing, applying for, and obtaining this Act, as well as the carrying it into effect, shall be a burden upon the assessments hereby authorised.”

The Act of 1829 continued in force unaltered until 2d August 1877, when the Perth Water Act 1877 (40 and 41 Vict. cap. 161) received the royal assent. It was set forth in the preamble of that Act, inter alia, that since the passing of the Act of 1829 the city of Perth had greatly increased in extent; that it was expedient that a further supply of water should be afforded and placed under the control and management of the Commissioners incorporated by the new Act, and that the undertaking of the Commissioners of 1829, and their whole rights and privileges, lands, buildings, reservoirs, works, and other property should be transferred to and vested in the new Commissioners. By section 30 it was provided that from and after the passing of the Act the Commissioners under the Act of 1829 should go out of office, and their whole powers, duties, and functions should cease and determine. The 40th section provided that “all resolutions of the existing Commissioners ( i.e., of the Commissioners under the statute of 1829), or of any duly authorised committee thereof, shall, so far as the same are applicable and remain in force, continue to be operative, and shall apply to the Commissioners, and to the officers and servants of the Commissioners, until duly revoked or altered by the Commissioners or under their

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authority;” and the 41st section provided that, “notwithstanding the passing of this Act, everything heretofore done, suffered, and confirmed respectively under or by virtue of the Act of 1829, or otherwise relating to the existing Commissioners, shall be as valid as if this Act had not been passed, and this Act shall accordingly be subject and without prejudice to everything so done, suffered, and confirmed respectively, and to all rights, liabilities, claims, and demands, present or future, which, if this Act had not been passed, would be incident to or consequent on anything so done, suffered, and confirmed respectively; and with respect to all things so done, suffered, and confirmed respectively, and to all such rights, liabilities, claims, and demands, the Commissioners shall to all intents represent the existing Commissioners, and the generality of this provision shall not be deemed to be restricted by any other of the provisions of this Act.” The Commissioners were further declared to be a body corporate under the name and style of “The Waterworks Commissioners of Perth.” And certain parties, who were the pursuers in this action, were nominated the first Commissioners for executing and carrying into effect the purposes of the Act until the first election of Commissioners. It was further provided that the water undertaking of the Commissioners under the Act of 1829, including lands, buildings, reservoirs, mains, pipes, rights, and water-plant, stock in hand, and property of every description, stores, machinery, arrears of water-rates, water-rents or charges, and all other property, heritable and moveable, real and personal, relating to or arising out of the water undertaking of the said Commissioners, with the whole powers, rights, and privileges belonging to such Commissioners in relation thereto, should belong to the Commissioners under the Act of 1877, subject to any mortgages, charges, encumbrances, debts, and liabilities to which the then existing water undertaking and water-works, with their appurtenances, or the lands on which they are erected, were or might be liable. All debts and money due from or to the Commissioners under the Act of 1829, or any person on their behalf, were to be payable to or paid by or to the Commissioners under the Act of 1877.

The pursuers averred that there was a large balance due to them by the former Commissioners, while the defenders refused to account save upon the footing of their being entitled to claim credit for — (1) A sum of £350, paid by them towards outlays in connection with the opposition made by them in Parliament to the passing of the new Act; and (2) A sum of £742, 1s., claimed by Mr Alexander Wilson, solicitor, Perth, for the balance of his account in connection with the opposition, after deducting the payment of £350. At a meeting of the pursuers in committee, held on 19th October 1877, they proceeded to consider the accounts of the late Water Commissioners, and recommended the present commission in the meantime to object to the said accounts in so far as the sum of £350 is charged therein, and to repudiate all liability for the expenses in connection with the opposing of the new Act. The defenders stated that they did not admit liability for Mr Wilson's claim of £742, 1s., but they considered that the pursuers were the proper parties to try the question, and were bound to relieve them of all claim at Mr Wilson's instance. They also averred that the opposition made in Parliament by the Commissioners acting under the Statute of 1829 to the passing of the 1877 Act was made justifiably and in good faith, and that the expense thereof formed a proper charge against the funds of the trust. One of the purposes of the new bill was the entire abolition of the trust created by the Waterworks Act of 1829. The expense incurred by the old Commissioners was in defence of the existence of the trust under their charge, and of the trust-rights vested in them by the Statute of 1829; and further, they said that the Act of 1877 was promoted privately contrary to the wish of the majority of the inhabitants, as shown by (1) a public meeting on 12th December 1876, where a resolution was passed unanimously authorising the 1829 Statute Water Commissioners, as trustees administering the Water Act, “to watch the bill threatened to be introduced into Parliament this session, and if necessary to oppose the same;” and by (2) the result of steps taken by the old Commissioners by means of voting-papers to ascertain whether the ratepayers were satisfied with the existing water supply and opposed to or in favour of the bill. These voting-papers were transmitted through the Post-office to, in all, about 4974 persons, being the whole Parliamentary electors, and also the female owners or tenants of properties valued at above £3 on the valuation roll. The voting-papers contained two questions, viz., “(1) Are you satisfied with your present supply of water?” and (2) “Are you opposed to the bill for an extension of the water supply promoted in Parliament this session by the committee of citizens?” The number of citizens who answered the first question in the affirmative was 2932, in the negative 354. The number who answered the second question in the affirmative was 2733, in the negative 496. These figures led the old Commissioners to believe that the course they were following in opposing the bill was not only agreeable to the community but entirely in accordance with its wishes. The £350 was expended under these circumstances, but other sums, amounting to £900, were also expended and paid by public subscription.

The defenders further set forth the Act 35 and 36 Vict. cap. 91, (which they averred applied to Scotland), section 2 of which provided that “when, in the judgment of a governing body in any district it is expedient for such governing body to promote or oppose any local or personal bill or bills in Parliament, or to prosecute or defend any legal proceedings necessary for the promotion or protection of the interests of the inhabitants of the district, it shall be lawful for such governing body to apply the borough fund or burgh rate, or other the public funds or rates under the control of such governing body, to the payment of the costs and expenses attending the same; . . . . provided that nothing in this Act contained shall authorise any governing body to promote any bill in Parliament for the establishment of any gas or water-works to compete with any existing gas or water company established under any Act of Parliament; provided that no powers contained in this clause shall apply in any case where the promotion of or opposition to a bill by a governing body has been decided by

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a committee of either House of Parliament to be unreasonable or vexatious.” The opposition made by the Commissioners under the 1829 Act to the bill of 1877 was not held by a committee of either House to be unreasonable or vexatious.

The pursuers denied that the expenditure had been incurred in terms of this Act.

The defenders pleaded inter alia—“(2) The fore-said expenditure of £350 by the Commissioners under the 1829 statute having been incurred by them bona fide, in defence of their trust, and in accordance with the desire of the ratepayers, they are entitled to credit for the same in accounting to the pursuers. (3) The pursuers are, in the circumstances above set forth, bound to relieve the defenders of the foresaid claim at Mr Wilson's instance.”

The Lord Ordinary ( Craighill) pronounced an interlocutor finding, in the first place, “as matter of fact—(1) That in 1829 an Act of Parliament was passed for supplying the city of Perth and suburbs and vicinity thereof with water; (2) that the Board of Commissioners appointed for carrying the provisions of this Act into operation were those specified in the condescendence, and the defenders called in the present action were the Commissioners under said Act during the year 1877, when it was ‘in part repealed, and the undertaking of the then existing Commissioners, and their whole rights, privileges, lands, buildings, reservoirs, works, and other property, were transferred to and vested’ in the pursuers by the Act 40 and 41 Vict. cap. 161; (3) that from the time when the works authorised by said Act of 1829 were completed, the water supply of Perth and suburbs and vicinity thereof, as defined by said statute, was provided by the Commissioners appointed under that Act, the cost being defrayed by a statutory assessment imposed upon the ratepayers; (4) that the purposes of said assessment are set forth in section 49 of the said Act of 1829 by which the Commissioners are authorised to raise ‘a yearly revenue or income sufficient and adequate to defray the annual expense attending the establishment, supporting the works, erections and appurtenances thereof, and carrying into effect the purposes of this Act; to satisfy and pay the interest of the sum originally expended in procuring this Act, forming the reservoirs, pits, tanks, wells, erections, and machinery necessary, providing and laying pipes, and other works and operations by this Act authorised, and to provide a surplus or sinking fund of such an extent as may be estimated to be sufficient to liquidate the whole debt incurred for the purposes of this Act within a period not less than thirty years nor more than fifty years from the commencement of this Act;’ (5) that prior to 1877 the existing arrangements for supplying Perth and suburbs and vicinity with water under the provisions of said Act of 1829 were considered by many of the inhabitants to be insufficient and unsatisfactory—the statutory limits, for one thing, having come, from the enlargement of the town, to be only a part of the area occupied by the population; and in consequence members of the community of Perth, entertaining this opinion, took in that year measures in the usual way for obtaining the sanction of Parliament to the changes they considered necessary for increasing the supply of water and widening the area within which it was to be furnished, as well as for so re-constructing the Board of Commissioners as to render it according to their anticipations more efficient for the purposes to be accomplished; and in particular they brought before Parliament a bill which in the session of 1877 was passed into law, and became the Act 40 and 41 Vict. c. 161; (6) that others of the inhabitants werehostile to the proposed changes, and their views on this subject having been adopted by the defenders, the latter in the persuasion that it was for the interest of the public they should so act, appeared before Parliament and opposed the passing of the said bill; (7) that in prosecution of this opposition an account was incurred by the defenders to Mr Alexander Wilson, solicitor in Perth, a portion of which—that is to say, the sum of £350, for which they claim credit in accounting with the pursuers—has been paid; and of liability for the remainder of which—that is to say, for the sum of £742, 1s. still unpaid—they claim to be relieved by the pursuers; and (8) that the defenders' opposition to the said bill, by the prosecution of which the said expenses were incurred, was not within the purposes for which the said Act of 1829 was passed, and was not incidental to any of those purposes: In the second place, as matter of law—(1) that the assessments levied by the defenders could not and cannot lawfully be charged with the said expenses which are here the subject of contention between the pursuers and the defenders; and (2) that as a consequence the defenders, in accounting with the pursuers, are entitled neither to be credited with the said sum of £350 nor to be relieved of liability for £742, 1s., the remainder of the expenses of their opposition to the bill which passed into law, and is now the Act 40 and 41 Vict. c. 161: Therefore repels the pleas stated for the defenders,” &c.

“ Note.—The Lord Ordinary thinks that the present case is ruled by the decision of Wakefield v. Commissioners of Supply of the County of Renfrew, Nov. 28, 1878, 16 Scot. Law Rep. 183, and by the authorities cited by Lord Curriehill in support of his judgment in that case. To sustain the defences would, in the opinion of the Lord Ordinary, be to sanction the view that statutory Commissioners appointed for specified public purposes are entitled at the expense of the ratepayers to oppose in Parliament any measure which may be brought forward for the purpose of extending the benefits for the promotion of which they were established. Persons who happen to be in the position of the defenders may as individuals take any part they please in supporting or opposing changes desired by other members of the community, but they are not entitled to fight the battle thus waged with means levied by assessment from the ratepayers. There is one way the unsoundness of the defender's contention is made strikingly manifest. The Act of 1877, like similar statutes, provides that the expenses of obtaining it should be defrayed out of assessments levied under its authority; and were the defences which have here been urged to be sustained, the consequence would be, not merely that the expenses of obtaining the statute of 1877, but a large proportion of the expenses incurred by the opponents of the bill which was passed into law would also be thrown upon the community. The Lord Ordinary cannot think that for this result there is warrant either in the Act of 1829 or in that of 1877, or on any principle or authority which can reasonably be applied to the circumstances of the case.

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The provisions of the Act 35 and 36 Vict. cap. 91, which are set forth by the defenders on the record, were not referred to at the debate; and the Lord Ordinary has therefore assumed that it is not now intended that these should be urged as grounds of defence.”

The defenders reclaimed, and argued that their expenditure in opposing the bill had been incurred bona fide to protect the trust of which they were the statutory guardians. They also maintained that they were entitled to act as they had done owing to the expressed support of a large majority of those persons who were taxed. The decision in Wakefield did not apply, because in that case the Commissioners of Supply were not within their statutory powers. Here the Act of 1872 (35 and 36 Vict. c. 91), sec. 2, applied, and was founded on to support the contention of the defenders.

The pursuers replied, that even if the Act of 1872 applied to Scotland, which was very doubtful, the defenders were not within it. The case of Wakefield was truly on all fours with the present. These Commissioners, who were acting as such for the benefit of the public, were not entitled to fight against legislation proposed for the advantage or increased advantage of the public. They might no doubt if they wished do so as individuals, but they could not do so as trustees, using the public funds for that purpose.

Authorities— Wakefield v. Commissioners of Supply of Renfrewshire, Nov. 28, 1878, 16 Scot. Law Rep. 183; The Queen v. The Mayor of Sheffield, June 1871, 6 L.R., Q.B. 652; The Queen v. The Norfolk Commissioners of Sewers (and Lord Campbell there), 20 L.J., Q.B. 121; Trustees of Mackintosh Fund v. Mackintosh, June 30, 1852, 14 D. 928; Cowan and Mackenzie v. Law (Edinburgh Water Bill), March 8, 1872, 10 M. 578; Brighton v. North, Feb. 13, 1847, 16 L.J. (Chan.) 255.

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