Scottish Court of Session Decisions

On 16th March 1888 George Simpson, Lomond House, Trinity, was charged at the instance of William Brown, solicitor, Hamilton and Glasgow, to pay the sum of £282, with interest, being the amount contained in and due by a bill, dated 10th November 1887, drawn by W. V. & J. R. Orr, 93 West Regent Street, Glasgow, upon and accepted by the said George Simpson, and indorsed to Brown. Simpson brought a suspension of the charge, and prayed that the note might be passed without caution or consignation in the following circumstances.

The complainer, who was the respondent's brother-in-law, averred (Stat. 2) that in 1886 he had occasion to go to America, “and that before leaving he executed a power of attorney in favour of the respondent (Brown), to whom also he gave a number of bill stamps accepted in blank, to be used for his (complainer's) business if required. None of these stamps were required in the complainer's absence, and on his return the respondent obtained a discharge from him, which was given on the respondent's assurance that everything was in perfect order. The com, plainer at the time forgot about the bill stamps, and when he afterwards applied to the respondent for them, the latter declined to give them up. The complainer filled up one of these bills for £77 in favour of a Mr Robert Strachan, Wishaw, and when the bill became due he paid it himself. The first and only intimation of this

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bill was a notice from the bank demanding payment when due, the complainer being absent from home at the time. The bill now sought to be suspended was filled up by the respondent without the complainer's knowledge or consent, and there is no ground for any claim upon him under the bill, as the following statement will show.” (Stat. 3) “In the autumn of last year Mr Dundas Simpson, complainer's father, had a claim of £282 made upon him by a bondholder over his properties in Airdrie for past due interest and expenses. The respondent, who is son-in-law to Mr Dundas Simpson, pressed the complainer repeatedly to relieve his father by paying the amount. The complainer positively declined to do so for several reasons, among others, that he had already paid £1500 of the bond, taking an assignation to the extent of £1300. The bondholder ultimately advertised the property for sale in virtue of his powers. At this juncture Mr Dundas Simpson called upon the respondent in Glasgow, when the complainer happened to be present, and when the respondent, who was acting for Mr Dundas Simpson, ultimately agreed with him to get a client of the respondent's to give a new bond, and thus discharge the existing ope, the new one to include the £282 referred to, and thus save the selling of the property. After this the respondent wrote the complainer while he was in France that he could, not manage to get another, client to take up the bond before the term. The complainer wired him from France that he must arrange himself with the parties. The complainer had hitherto, as stated, positively refused to have anything to do with the matter as his view was that the property should be sold, and part of it bought for his father. In his dilemma it appears that in order to stop the sale the respondent arranged with the agents of the bondholder to give them his acceptance for the amount, which was done by filling up one of the blank bills that the respondent so unwarrantably held, for the £282. At same time, as it turned out afterwards, the respondent gave also his own cheque, dated same time as the maturity of the bill. The agent of the bondholder was aware that the respondent had filled up the blank' bill stamp referred to, and that without the complainer's knowledge, as he personally informed the complainer so, when he shortly afterwards met him accidentally in Glasgow. Indeed it was from him, and at that time, that the complainer first learned to his amazement what the respondent had done. The respondent had written the complainer to Paris what he had done, but at that time and for some time afterwards the letter was not returned to him. On the maturity of the bill the respondent pressed the complainer to pay Messrs Orr, and knowing that the respondent had other obligations pressing him at the time, and to avoid the scandal and injury to him if proceedings were taken against him for this action, the complainer was willing to do so if the respondent realised some of his stocks for him. The complainer was under no obligation and undertook none to his father, either to the bondholder or to the respondent, in respect of the £282, and as stated the respondent filled up the bill stamp that he unwarrantably held without the complainer's knowledge and consent. The claim that the respondent has in respect of the £282 paid by him on account of his failure in arranging a new loan he has against Mr Dundas Simpson, and not against the complainer.”

The respondent averred that in November 1887 he had been employed by the complainer to obtain a loan to pay off a bond of £1700 over a property belonging to the complainer's father, with arrears of interest due thereon amounting to £282, and to get the transaction carried through at once; and that the bondholders, through their agents, Messrs Orr, writers, Glasgow, were threatening to sell the property unless the interest was paid. He further averred—(Stat. 1) “Previous to this the complainer had seen Messrs Orr, and had offered to grant them his bill for the interest past due, but they declined to accept it, and upon the respondent explaining the circumstances to the complainer he authorised the respondent to settle the transaction by the bill in question as aftermentioned.” (Stat. 2) “The respondent being unable to get Messrs Orr to delay the sale of the property otherwise, he granted the bill in question, and at the same time gave Messrs Orr a cheque for the amount, payable when the bill was due, in case the complainer should be unable to meet it, and on the same day the respondent wrote to the complainer that he had arranged with Messrs Orr to take over the bond at Whitsunday next; that Messrs Orr would not withdraw the sale unless the arrears of interest and expenses were settled; ‘and I have accordingly given your bill at two months' date from to-day for £282 in payment of the interest and expenses.’ During the period from 10th November till the time when the bill became due correspondence took place between the respondent and the complainer, in course of which the complainer not only did not deny, but over and over again admitted, that he was due the sum in the bill, though unable to meet it.” (Stat. 3) … “With reference to the complainer's statements about his meeting with Messrs Orr, and their statements to him, there is herewith produced a letter from Messrs Orr, sending the respondent copy of a letter from the complainer to them with their reply, from which it appears that the complainer had offered to settle the matter by giving his own bill, which they had declined, and that when they did take his bill it was only because it was supported by the respondent's cheque. Also, that at the meeting between the complainer and Mr Orr, when the latter spoke of the settlement made by the bill, the complainer stated that it was all right. The complainer has frequently stated to the respondent, and to others, that he was due the bill in question.”

The complainer pleaded (1) that no value had been given for the bill; and (2) that as it had been fraudulently and unwarrantably written on the blank bill stamp, it formed no warrant for diligence against him.

The respondent pleaded, inter alia, that as the complainer was due the bill in question, he was bound to make payment.

Various letters passed between the parties relative to this transaction of which the following are the more important:—On 9th January 1888 Simpson wrote to Brown—“I have been trying for the past few days to realise, so as to cover the bills due to Orr, but it is almost impossible to do so. It is most aggravating to be forced to sacrifice when there is ample security

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in the property to cover. I will write yon again to-morrow.” On 10th January Brown wrote to Simpson—“I have yours of yesterday. It is more than ever necessary that you arrange with Mr Orr on the 13th at latest, as I have been to-day disappointed in a considerable sum which ought to have been paid, and is now postponed indefinitely. So please understand that I look to you to meet the claim without fail.” On 10th January Simpson wrote to Brown—“I am disappointed again, and must therefore fall back on you to realise to clear off Orr's matter. Surely amongst your numerous friends you can manage to realise this small sum at something like a good figure, and at once.” On 12th January Simpson wrote to Brown—“You know my position, and the utter impossibility of realising at the moment. You have so many friends in Glasgow, that surely you can get some of them to purchase stock to clear off Orr—such as some of the New Mexico Syndicate that I acted so generous towards.” On 27th January 1888 Messrs Orr wrote to Messrs Brown & Company annexing copy letter from Mr George Simpson, and copy of their reply, which were as follow:—“26th January 1888. Dear Sirs,—You casually mentioned to me some two months ago that Mr Brown had given you my acceptance for the sum due by my father. I told you that there was some mistake, as I had never signed such a bill, and this was the first I had heard of the transaction, although I had just a few minutes previous left Mr Brown. You then told me that you believed that Brown had filled up a blank bill stamp he had in his possession signed by me; to this I replied that he had no authority to do so, but so far as you were concerned I daresay you would be all right as Brown would see to it. Some time after I got a letter from Brown informing me what he had done. The letter had been sent to the Continent after me. So far, however, as you were concerned, you knew from me that Brown had given you this without authority and outside my knowledge. I have been most unwilling to take decided steps in the matter, looking at the relationship with Mr Brown; but owing to other matters having transpired of a similar nature, I have been compelled to place my affairs with Mr Brown in the hands of Messrs Richardson & Johnstone, W.S., Edinburgh, to be dealt with by them. I have intimated to Mr Brown that I decline having anything to do with the bill. So far as you are concerned, I understand that you have his cheque, and therefore you are covered.—Yours truly, Geo. Simpson.” The reply was dated 27th January, and was in these terms:—“Dear Sir,—We have your letter of 26th curt., with the contents of which we are extremely disappointed. We cannot admit your statement of what took place at your meeting with our J. Rowley Orr, for the simple reason that it is inaccurate. You personally had proposed to us, months before the events to which you allude, to settle the matter by giving us your bill, and we had then declined to take it as being an irregular method of paying a debt of the nature of interest on a bond held by a body of trustees, and when we did take your bill it was only because it was supported by Mr Brown's cheque. We feel it necessary to record that at the meeting already referred to with our J. Rowley Orr, when he informed you of the settlement made, you stated that it was all right, and you didn't state that Mr Brown would see to it. We have sent a copy of your letter and our reply to Mr Brown.—Yours truly, W. V. & J. R. Orr. P.S.—You are sufficiently well acquainted with the law of bills to know that in the hands of a party who has given value, and who obtained the bill in good faith, there is no answer but payment. We have no alternative, therefore, but to proceed to recover, and this, at the request of Mr Brown, we shall delay until Tuesday the 3lst curt., as he hopes in the meantime to have an opportunity of seeing you.—W. V. & J. R. Orr.”

On 31st March the Lord Ordinary ( Lee) passed the note without caution.

“ Note.—In the circumstances, so far as admitted by the respondent, and appearing from the correspondence produced by him, it appears to me that as between the suspender and the respondent, the bill in question cannot be held to instruct value to have been received by the suspender from the respondent.”

The respondent reclaimed, and argued—The correspondence was in direct opposition to the complainer's averments on record, for in his letters to the reclaimer he admitted the debt and alleged he was doing his best to meet it. The bill in question was granted for value, and it was held by the reclaimer from the original drawers. The question of caution was no doubt a matter for the discretion of the Court, but in the present case, if there was to be enquiry, it should only he on the complainer finding caution— Allan v. Galli, June 5, 1829, 7 S. 706; Law v. Humphrey, July 20, 1876, 3 R. 1192; Bills of Exchange Act, 1882 (45 and 46 Vict. cap. 61), sec. 100.

Replied for the complainer—The authority granted to the respondent Brown was limited, and he admitted it to be so. In filling up the bill in question he had quite exceeded the purpose for which the stamps were given to him, for they were to be used only for the complainer's business. The question between the parties was one of facts and circumstances, and looking to the correspondence, and the averments and admissions, this was not a case in which the Court would call on the complainer to find caution—Mackay's Bract, vol. ii. 192; Ross v. Millar, December 2, 1831, 10 S. 95.

At advising—