Scottish Court of Session Decisions

In the month of January 1880 Mr James Smith, merchant, Kirkliston, employed Messrs Meikle & Wilson, accountants and business agents in Edinburgh, to collect certain outstanding debts which were due to him, and to negotiate for the sale of his Kirkliston business. To enable his employees to carry out these instructions, Mr Smith handed over to them a list of the debts to be recovered and two business books. Messrs Meikle & Wilson thereupon proceeded to examine the business books, to write letters to the debtors, and to effect the sale of the Kirkliston business. A sum of £2,15s. due to Mr Smith was in this way recovered, and the sale of the business was completed.

On the 6th of February 1880 Mr Smith, who had become insolvent, granted a trust-disposition of his whole means and estate to Mr James Pollard, chartered accountant, Edinburgh, for behoof of creditors. At the meeting when the disposition was agreed to be granted by Mr Smith, Mr Meikle was present, but did not accede to the disposition. At this time Messrs Meikle & Wilson had an account against Mr Smith for the above-mentioned transactions. A balance of £16, 1s. 10d. was claimed as still due. In order to enforce payment of this debt Messrs Meikle & Wilson retained possession of the business books which had come into their hands.

Shortly after the trust-disposition was granted Mr Pollard requested Messrs Meikle & Wilson to deliver up to him, as the trustee on Smith's estate, the business books in their possession. Messrs Meikle & Wilson refused to do so, on the ground that they had a right of retention over the books until payment of their account. Mr Pollard thereupon petitioned the Sheriff to ordain Meikle & Wilson to deliver to him, as trustee on Smith's estate, the whole vouchers, writs, title-deeds, lists of book debts, and in general the whole documents in their possession relating to or forming any portion of Smith's estate. The petitioner pleaded, that being in right of the whole means and estate of the said James Smith in virtue of the disposition in his favour, he was entitled to delivery of the documents sued for. The defenders replied, that having acquired actual possession of the documents from the owner thereof to carry out his instructions to them as accountants and business agents, and having done so, they had a right of lien or retention over them for their charges.

The following interlocutor and note were issued by the Sheriff-Substitute ( Hallard):—“Having heard counsel on the defenders' plea of retention, repels said plea.”

“ Note.—The authorities to which the Sheriff-Substitute was referred at the debate in support of the proposition that an accountant has the same lien over his employer's writs as a law-agent are not sufficient to support that plea. In Stewart v. Stevenson, Feb. 23, 1828, 6 Shaw 591, the accountant who successfully pleaded the lien was an officer of Court. In Bruce v. Irvine, Feb. 7, 1835, 13 Shaw 437, the point was reserved, although it is true that in the Lord Ordinary's interlocutor there is an important observation on the case of Stewart. The case of Renny and Webster v. Myles and Murray, Feb. 8, 1847, 9 Dunlop, New Series, 619, is not in point, except as illustrating the disinclination of the Court to extend the writer's lien beyond the limits assigned to it by previous authorities—Lord Mackenzie quoting the pithy maxim, quœ contra tenorem juris fiunt non sunt trahenda ad consequentias.

If, therefore, the defenders' plea has any valid foundation, it must be identical with that of the artificer who retains the article he has made or repaired in security of the sum due as remuneration for his work. The writs and papers of which delivery is sought in the present process are not in that position. On none of them have the defenders executed any operation which can be assimilated to an act of manufacture or repair. They are mere instruments handed over for a certain purpose, and of these the petitioner, as trustee for the insolvent's creditors, now demands restitution.

An order for delivery as prayed for would at once have been made, but it appears from the record that parties are not at one as to the precise list of papers and documents in question. That matter therefore remains over.”

On appeal the Sheriff ( Davidson) affirmed the Sheriff-Substitute's interlocutor, and added the following note:—

“ Note.—The defenders call themselves ‘Accountants and Business Agents.’ They belong to no established or known body of authorised legal practitioners. That was admitted at the bar. If the defenders are entitled to claim the right of lien, any person whatever who chooses to assume a designation to which he is not legally entitled might equally claim privileges belonging only to recognised bodies. But, further, there is no authority for holding that an accountant can plead the hypothec of a law-agent. That right is a special rule against the general rule of law; and for some years there has been a strong feeling against extending the privilege beyond the strict rules which practice has allowed to certain persons. It certainly cannot be extended to persons in the assumed position of the defenders.”

The defenders then appealed to the Second Division of the Court of Session.

The authorities quoted to the Court are all referred to in the Sheriff-Substitute's note.