Scottish Court of Session Decisions

The Union Bank of Scotland sued William Davidson, plumber, Aberdeen, in the Sheriff Court of Aberdeen, for payment of £152, 3s. 10d., being the balance due to the bank on his account-current with them. The accuracy of the account was admitted, but the following facts were stated in defence:—The circumstances of the defender having become embarrassed, he granted a trust-deed for behoof of creditors on 3d June 1880, and a trustee was appointed to realise his estate. In the course of the negotiations which ensued, the agent for the Union Bank wrote to the trustee, asking that, as the bank was pressing for recovery of their debt, and as certain assets had been recovered by the trustee, he should pay an interim dividend.

On these facts the defender pleaded—“(1) The pursuers having acceded to the said trust-deed, they are, especially under the circumstances stated, barred from suing the present action except to the extent of obtaining a decree of constitution at their own expense, and they are barred from taking proceedings against the defender thereon.”

The Sheriff-Substitute ( Dove Wilson) decerned against the defender. He added this note:—

The debt is admitted, and no discharge is produced; but it is said in the defence (so far as relevant) that the pursuers have consented to a trust settlement of the defender's affairs, to the effect of preventing them from doing anything to recover their debt except await the action of the trustee.

“The proper evidence of such a consent is either actings or writings, and parole evidence is not admitted except for the purpose of making these intelligible. No writing of consent is produced; but it is said that the pursuers lodged a claim with the trustee, and there are produced certain letters showing that they were willing to accept a payment from him to account. But nothing has followed on these actings. The trustee has not paid anything, but prefers (it is said) using the trust-funds in a litigation, which (it is again said) is more for the benefit of the insolvent than of his creditors. The pursuers now prefer to recover their debt in the ordinary way, and it is difficult to see what has happened to prevent them. Merely being willing to accept payment from the trustee cannot be pleaded as an election to take him as their sole debtor in place of the insolvent.”

On appeal, the Sheriff ( Guthrie Smith) adhered.

The defender appealed to the Court of Session, and argued that, on the above facts, the bank must be held to have acceded to the trust-deed, and to be therefore barred personali exceptione from succeeding in this action.

Authorities— 2 Bell's Comm. (3d ed.) 499; Marianski v. Wiseman (M'Lean's Trustee), March 10, 1871, 9 Macph. 673; Athya v. Clydesdale Bank, Jan. 28, 1881, 18 Scot. Law Rep. 287.

The Lords, without calling upon counsel for the respondent, refused the appeal.