Scottish Court of Session Decisions

Murdo Macdonald, Inverness, having been sequestrated a competition took place for the office of trustee.

The minute of the meeting of creditors held to elect a trustee on 29th November 1886 showed that John Macdonald, a creditor for £114, 3s. 4d., voted for Mr John Grant, accountant, Inverness, while Mr Howard Smith, a creditor for £125, 19s. 4d., and Mr Urquhart, a creditor for £12, 12s., and Mr Howard Smith, as mandatory for three other creditors to the amount of £24, 5s. 4d., £7, 12s., and £57, 2s. 5d., voted for “William Moncur, writer, Edinburgh,” whom failing “John Anderson, commission agent, Edinburgh,” whom failing a gentleman who subsequently withdrew from the competition. Thus Moncur had votes of creditors in all amounting to £219, 11s. 11d. Cautioners were proposed for each of the candidates.

Moncur objected to the vote in favour of Grant, inter alia, (l) that the oath was vitiated in essentialibus; (2) that the creditor was conjunct and confident with the bankrupt, and the vouchers were insufficient; but these objections need not here be further detailed.

On the other hand, John Macdonald, the creditor who voted for Grant, Grant himself, and the bankrupt, objected to Moncur as follows—“(1) William Moncur, first named as trustee, is entirely unsuitable. It is averred that he is an old man, who was at one time a clerk, and is now lodging in a close in the Canongate in Edinburgh, and is without means or occupation. The person proposed as his cautioner is a clerk to Mr David Howard Smith, who is acting as agent in the sequestration; he is without means, and utterly insufficient as cautioner for a trustee in a sequestration. (2) They objected that Anderson (the trustee proposed, failing Moncur) was also unsuitable; that there was no ‘John Anderson, commission agent, Edinburgh,’” so far as the Directory showed or the objectors could find.… “(4) The objectors allege that the parties proposing Messrs Moncur and Anderson are purposely endeavouring to appoint a man of straw to the post of trustee in order that actions and claims against him which might arise out of his administration, or the proceedings taken by him or in his name, may be frustrated by the absence of means in the case both of himself and the person put forward as cautioner. It is also averred that Mr Charles John Monro, who recently resigned office, resigned in order to escape liability for claims of a similar character.”

The Sheriff-Substitute ( Blair) on 7th December 1886 pronounced this interlocutor—“Finds the objections of John Macdonald [the creditor], Murdo Macdonald [the bankrupt], and John Grant, relevant, allows them a proof of their averments, and the opposing creditors a conjunct probation.” He fixed a diet for the proof.

Moncur appealed to the Court of Session under section 170 of the Bankruptcy Act 1856, craving the Court to recal the deliverance of the Sheriff, and to remit to him with instructions to declare him (appellant) duly elected trustee in the sequestration, and to find him entitled to expenses.

He argued—The question as to his fitness for office and the sufficiency of his cautioner was one for the creditors—Bell's Comm. ii. (5th ed.) 371. He was not said to be bankrupt, but only to be poor. The averments were too vague to be sent to proof, especially on the demand of the one creditor who formed the minority, and who was the bankrupt's brother, and of the bankrupt and a competitor for the trusteeship. He referred to the Bankruptcy Act 1856, secs. 68, 69, 71, and 170. The appeal was competent— Wylie v. Kyd (first report), May 21, 1884, 11 R. 820; Tennent v. Crawford, January 12, 1878, 5 It. 433.

Argued for the respondents—(1) The appeal was incompetent— Gall v. Macrae, June 9, 1880, 7 R. 888. (2) The case was one for inquiry, and the Sheriff was right in seeking to ascertain the facts with regard to the objection that an unsuitable person was being put forward for an illegitimate object. It was averred, and was plainly relevant, that the proposed trustee was in a very bad position, and the cautioner quite unsuitable. The matter was one for the Sheriff's discretion, and his judgment should be affirmed— A B, Petitioner, February 19, 1833, 11 S. 412; Bell v. Carstairs, December 17, 1842, 5 D. 318; Wylie v. Kyd (second report), May 21, 1884, 11 R. 968.

At advising—