Scottish Court of Session Decisions

This was a petition to charge the entailed estate of Isle with improvement expenditure. The petitioner, Joseph Gillon Fergusson of Isle, was heir of entail in possession under a disposition and deed of entail dated in 1768, and recorded in the Register of Tailzies in 1789.

The petitioner was of full age and not subject to any legal incapacity. He had three children, all pupils, and entitled in their order to succeed after him—Robert Don Gillon Fergusson, J. S. E. Gillon Fergusson, and I. M. Gillon Fergusson.

He stated that he had, between 1881 and 1886, expended on the entailed estate, in additions and improvements on the mansion-house and offices and farm buildings, and other permanent improvements, a sum amounting to £2140, and was under 38 and 39 Vict. c. 61, secs. 7 and 8, and 45 and 46 Vict. c. 53, sec. 6 (Entail Acts 1875 and 1882), entitled to borrow money to defray the cost of those improvements, “together with the actual or estimated cost of this application, and of the proceedings therein, and of obtaining the loan, and granting security therefor.” He accordingly craved authority to borrow the same, and to charge the fee of the entailed estate other than the mansion-house &c., with a bond of annual-rent binding himself and his heirs of tailzie to pay an annual-rent on said sum for twenty-five years from the authority of the Court being obtained; or alternatively, to borrow three-fourths of the sum expended on improvements, together with the costs of the application as aforesaid, and to charge the fee of the estate with a bond and disposition in security therefor.

A curator ad litem, Mr C. G. Raukine Simson, W.S., was appointed to the petitioner's children, and the Lord Ordinary remitted the petition to a man of business, Mr H. B. Dewar, S. S. C.

The petitioner proposed to adopt the alternative of granting a bond and disposition in security.

The curator ad litem lodged a minute, in which he contended that in place of the whole expenses being included in the bond and disposition in security, only three-fourths of the expenses should be so included.

He stated—“The curator's view is that the meaning of sec. 7 (6) of the Entail Act 1875 is that the expenses should be added to and put on the same footing as the amount of improvement expenditure which may have been approved of by the Court as chargeable on the estate, the petitioner being entitled to choose whether to charge the whole accumulated sum of improvement expenditure and expenses by way of a bond of annual-rent, or only three-fourths of such accumulated sum by way of bond and disposition in security. The Act referred to first prescribes the manner in which the amount to be charged on the estate, made up partly of improvement expenditure and partly of expenses of the application to the Court, Ac., is to be fixed, and then by sec. 8 goes on to provide alternative methods in which the amount so fixed may be charged on the estate; the accumulation of the expenditure and the expenses thus preceding the striking of the three-fourths proportion if the method of granting a bond and disposition in security over the estate is to be adopted.”

Mr Dewar in his report to the Lord Ordinary reported that there was diversity of practice on the point, but in a majority of instances the whole expense seemed to have been allowed. He referred more particularly to sub-sec. (6) of sec. 7 of the Entail Act 1875—“In every case the Court shall in fixing the amount to be borrowed under their authority, add to the actual or estimated amount of the cost of the improvements the actual or estimated amount of the cost of the application, and the proceedings therein, and of obtaining the loan, and granting security therefor;” and also to sec. 8 of the Act of 1875. He stated that in his opinion the curator ad litem was right, and that three-fourths, and not the whole, of the legal expenses ought to be allowed.

The Lord Ordinary ( Trayner) pronounced this interlocutor:—“Finds that the procedure has been regular and proper, and in conformity with the provisions of the statutes and relative Acts of Sederunt: Interpones authority: Finds that the petitioner has, prior to the date of application and within the last twenty years, bona fide expended on improvements on the said entailed estates the sum of £2081, 12s. 11d.: Disallows the sum of £58, 10s. 3d. mentioned in the abstract appended to Mr Johnston's report: Grants warrant to and authorises the petitioner to borrow and charge the fee and rents of the foresaid entailed lands and estates so far as situated in the shire of Dumfries, other than the mansion-house, offices, and policies thereof, with the sum of £1561, 4s. 9d., being three-fourths of the fore-said sum of £2081, 12s. 11d. expended by the petitioner on improvements as aforesaid, together with the sum of £74, 17 s. 9 d., being three-fourths of the estimated cost of this application and the proceedings therein, and of obtaining the loan and granting security therefor, amounting together to the sum of £1636, 2 s. 6 d., with corresponding interest and penalties, and decerns:

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Remits to Mr Dewar to see prepared and executed the draft of a bond and disposition in security for the said sum of £1636, 2s. 6d., or of bonds and dispositions in security for amounts not exceeding in all the said sum of £1636, 2s. 6d. over the said entailed estate, or any portion thereof, so far as situated in the shire of Dumfries, other than as aforesaid, with interest thereon at a rate not exceeding five pounds per centum per annum from the date of the advance until payment, and with penalties in common form, such bond and disposition in security, or bonds and dispositions in security, binding the petitioner, and his heirs of entail in their order successively, to repay the principal sums therein, with interest and penalties as aforesaid, and containing a power of sale in ordinary form, and also all other clauses usual and necessary in bonds and dispositions in security granted over lands in Scotland held in fee-simple, but always with and under the provisions and declarations applicable to such bonds and dispositions in security contained in the statutes there an ent, and to report.”