Scottish Court of Session Decisions

On 12th June 1880 a minute of agreement was entered into between Thomas Lucas Paterson of Dowanhill on the one part, and George Coupar, Robert Borland, and Adam Borland, the partners of the firm of Adam Borland & Co., on the other part, by which the first party agreed to feu, and the second party to take from him in feu, a plot of ground in Victoria Street, Govan, on the following among other conditions:—“ First—The term of the second parties' entry shall be the term of Whitsunday 1880 Third—The second parties shall before the term of Whitsunday 1881 erect and finish on said plot of ground tenements of dwelling-houses, or of shops and dwelling-houses, of four square storeys in height, with suitable offices, and the houses shall consist of not less than two apartments each, but the second parties shall have liberty to have one house of one apartment in each flat…. . Seventh—In case the first party shall make advances to enable the second parties to erect and finish said tenements, or of their being indebted to him in any sums, he shall be entitled to hold the said ground and whole erections made or to be made thereon as a catholic security for repayment of the debt due to him at the time, including interest and expenses, and to let the subjects and uplift the rents thereof; and he shall also have full power to sell and dispose of the said tenement or tenements and ground by public roup or private bargain, and to dispose the subjects to the purchasers absolutely and

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irredeemably under the burden of the original feu-duty and others effeiring thereto, and to apply the prices or rents thereof in repayment of the debt due to him, whether under bills or otherwise, and interest thereon, and whole expenses which may be incurred by him in the premises. Eighth— The first party shall also have full power, if he thinks proper, to complete and finish any of said tenements left unfinished at the sight of any architect in Glasgow whom he may appoint previous to selling and disposing of the same, and a certificate under the hands of said architect of the sums which may be expended by the first party in completing and finishing said tenements, including said architect's remuneration, shall be sufficient evidence of the sums of money that may be so expended. Ninth—In case the first party shall make advances as aforesaid to the second parties, the same and all interest due thereon, and expenses incurred by him, shall be repaid to him by the term of Martinmas 1880, failing which he shall at any time thereafter be entitled to exercise the whole powers conferred on him by these presents.” ….

About 1st May 1880 Messrs Borland & Co. began operations for the erection of three tenements of dwelling-houses on the plot of land so feued to them. Instalments, amounting in all to nearly £1500, were paid by Mr Paterson, acting under reports by Mr Thomson, civil engineer and architect to the pursuers in terms of the agreement, Mr Thomson's report as to the first instalment being dated 15th June 1880, and that as to the second and third instalments being dated 8th July 1880. On 6th September, however, Mr Thomson reported in these terms:—“At the request of Messrs Borland & Co. I have made an inspection of their new buildings in Govan, but the work is so bad that I cannot report further for payment.”

On 8th September Mr Paterson wrote to Borland &Co. as follows:—“Dear Sirs,—I have just received a note from Mr Thomson, archt., stating that he ‘has inspected your buildings, but the work is so bad he cannot report further for payment.’ I have also recd, information from another party that the statement you made as to the external walls of the tenements in the neighbourhood of yours not being strapped and lathed is quite incorrect. This confirms the objection I made to your not having lathed your buildings when I asked if you had done so last Friday. I feel greatly annoyed at the way you have conducted matters throughout, and seeing Mr Thomson refuses to grant you certificate for further advances, I am at a loss to see what is to be done. I have acted liberally with you hitherto in the hope that you would carry out my urgent recommendation—as you promised you would—that you would build good and substantial property, and am greatly disappointed that you have not done so. I purpose being at my office on Thursday, and wish you to come and meet me that day at one o'clock in order that some understanding may be come to as to what is to be done.—Yours,”&c.

Various correspondence ensued, in course of which the defender intimated that the pursuers must remedy their deficient work, and if they failed to do so it would be necessary for him to take the work into his own hands and complete the houses himself. He further wrote on 27th September 1880:—“I wish further to repeat the recommendation which I made to you this morning, to call your creditors together and afford me an opportunity of informing them how matters stand between you and me, and of my willingness to make over the property to them upon being paid for my outlays on your account. I am prepared to do this as soon as I have remedied the existing defects, and leave them thereafter to carry out the finishing; and failing their agreeing to this, it will fall upon me to finish the property wholly, after which I shall sell it, and if there is any surplus arising out of it beyond my outlays, such surplus can be paid over to your creditors. I am extremely sorry that matters should have come to this crisis, but it is wholly owing to your own mismanagement and unwise conduct.—Yours,” &c.

On 26th October Mr Stewart, Mr Paterson's law-agent, wrote to Mr Kennedy, agent for Borland & Co., as follows:—“Dear Sir,—I have your note of this morning, and beg to hand you, as requested, copy of the agreement between Mr Paterson and Messrs Adam Borland & Coy. I also hand you a letter which I wrote Mr George Couper on the 20th, which was returned marked’ Gone, no address.’ I may repeat here what I said to the meeting yesterday, that Mr Paterson is ready to make any reasonable arrangement for the tenements being finished, and that he has no desire to take the finishing into his own hands, or to put the creditors to disadvantage in any way whatever. His interest lies in the buildings being finished in a tradesmanlike and proper manner, and either sold or a loan obtained in order to his advances being repaid; but of course he must protect his own interests, and no one, I should think, can blame him for doing so. I hope that the creditors may see their way to take up the matter, and I shall be glad to hear from you at your earliest convenience what they have to propose. It is desirable that delay should be avoided.—Yours, “&c. And on 1st November Mr Stewart wrote to Mr Kennedy as follows:—“Dear Sir,—I beg to intimate to you, as acting for Messrs Adam Borland & Coy. and their creditors, that Mr T. L. Paterson will forthwith, in consequence of their leaving the tenements at Govan unfinished, and in terms of the agreement, proceed to finish the same, and sell and dispose thereof when finished, and apply the price or prices obtained therefor in repayment of his advances made and to be made, interest thereof, and all costs, charges, and expenses incurred and to be incurred in the premises, and he will account for the surplus, if any, to the person or persons having right thereto. I shall feel obliged by your acknowledging receipt of this intimation.—I am,” &c.

On 14th September Mr Kennedy had procured a report from Mr Taylor, architect, with a view to raising a loan on the property in question. Mr Taylor's report was in these terms:—“Dear Sir,—As instructed, I have examined three tenements forming Numbers 27–35 Queen Street, Govan, presently in course of erection by Messrs Adam Borland & Co., and have to report—These buildings are four storeys high, each tenement having a frontage of 32 feet to Queen Street, by a depth of 38 feet 6 in., and are to be occupied as dwelling-houses of one and two apartments, with w. c. s, entering off half stair landings. They are at present being plastered, and so far as they have gone are substantially built, and are standing

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well—the front walls are of polished ashlar, back walls rubble, and brick gables. I estimate the rental at about £92, 10s. for each tenement, or £277, 10s. in all, subject to feu-duty of £52, 17s. 6d., and think the value of the subjects when completed for occupation will be two thousand nine hundred and twenty-five pounds sterling (£2925), after allowing for the above feu-duty, and will form a good security for a loan of two-thirds of that amount.—I am,” &c.

Mr Paterson on 18th October paid off Messrs Borland's workmen, and took the work into his own hands. On 22d November 1880 the estates of Borland & Co., and of the individual partners, were sequestrated, and Mr William Munro, accountant, appointed trustee thereon. Mr Munro subsequently raised this action against Mr Paterson, concluding for £1225 in name of damages and solatium.

The pursuer averred—“The buildings, it was estimated, would not have cost Messrs Borland & Co. more than £2200, and would have, on Mr Taylor's valuation, yielded them a profit of £725, of all which the defender has deprived them. In consequence of the defender's illegal and unwarrantable actings, certain of the parties from whom Messrs Borland & Co. bought materials did diligence against them and put them in prison, with the view of cutting down the defender's attempted preference, and Messrs Borland & Co. were forced to take out sequestration. At this date Messrs Borland & Co. were perfectly solvent. Their debts were contracted solely in connection with the erection of the foresaid tenements. These, as explained, were the only assets of the firm, but, as valued by Mr Taylor, amply sufficient to leave a large surplus of profit after payment of all debts. The defender knew or might have known that his appropriation of their whole property would be followed by their sequestration. The defender has by his illegal actings, in breach of his contract, ruined Messrs Borland & Co. Their business has been entirely broken up, and each of the partners, Adam Borland, Robert Borland, and George Coupar, has sustained a deep injury in his character, commercial credit, and feelings through the said illegal proceedings and their consequences. The injury and damage so inflicted are estimated at not less than £500, in addition to the loss of said profit of £725.”

The pursuer pleaded—“(1) The defender having dispossessed brevi manu the said Adam Borland & Co. of their property, and appropriated materials in their possession, having acted in violation of the agreement condescended on, and prevented them from fulfilling their obligations thereunder, the pursuer, as trustee foresaid, is entitled to decree as craved. (2) The defender is liable in damages and solatium as concluded for, in respect of (1) injury, (2) damnum emergens, and (3) lucrum cessans.”

The defender pleaded—“(2) The defender having acted within his rights in the matter alleged, the action cannot be maintained. (3) Separatim, The defender having acted in the matter alleged with the consent and authority of the said firm, the action cannot be maintained. (4) No damage having been sustained, the defender should be assoilzied.”

Proof was led. Robert Bryce, called for the pursuer, said—“I am a joiner. I was foreman joiner to Borland & Co. at the tenements in question. I have had considerable experience as a joiner. I was foreman with different parties in Partick and Govan for about six years. I went to Borland & Co.'s tenements at the beginning of the work. The buildings I had previously been engaged upon were of a better class than those of Borland & Co. The joists of the tenements in question were made of white pine. It was not first-class timber. Some of the joists were good, and some were not. I cannot say how many were not good—about six or seven. There were fourteen joists in each flat, and four flats in each tenement. Some of the joists were bridled, that is, joined. That must tend to weaken the building, because the full length of the joists ties the building together. I never saw joists bridled in other tenements. The joists were 36 feet long, and 10 inches by 2 1 4 (Q.) Did you consider they were sufficient to bear the weight and strain in that tenement ?—(A.) Yes, but they did not bind the back and front walls together. By the Court—(Q.) And what would happen in consequence ?—(A.) Perhaps the weight of the roof might strain the back or front wall, and it might go out, and then I suppose the building would shiver and come down. Examination continued—I saw no symptoms of strain. The first beams were put in about July. They were quite visible up to October. I saw Mr Thomson once or twice about the premises. I observed the couplings of the roof. (Q.) Were they well fastened together?—(A.) There was an oxter-piece at one and a baulk at another. By the Court—(Q.) Was that good work?—(A.) Well, no. There should have been an oxter-piece and a baulk at each coupling. Examination continued—It is not common to put them up at first at every alternate coupling and add the others afterwards. I never saw or heard of that.” Three witnesses for the defender,—M'Laren, Fulton, and Love—all joiners, gave evidence as to the rough, faulty, and unsafe character of the work.