Scottish Court of Session Decisions

Alexander Leith was at the date of his death on 14th July 1886 heir of entail in possession of the lands of Glenkindie and others, in the county of Aberdeen. By a codicil to his trust-disposition and settlement, dated 21st December 1883, he bequeathed, under section 11 of the Entail Amendment Act of 1875, to his daughter Georgiana Leith all right and interest competent to him to charge his entailed lands of Glenkindie and others with all expenditure on improvements already executed, or which might thereafter be executed by him. He was succeeded as heir of entail in the lands of Glenkindie and others by his brother General Robert William Disney Leith.

This petition was presented by Miss Georgiana Leith, in which the Court was asked “to find and declare that the sum of £1900, or such other sum as may be ascertained by your Lordships to have been expended on the entailed lands and barony of Glenkindie and others, was expended by the deceased Alexander Leith while heir of entail in possession of said entailed lands and barony, on improvements thereon of the nature contemplated by the said Act 38 and 39 Vict, cap. 61; to find that the petitioner is in right thereof; and to decern and ordain the said General Robert William Disney Leith, as heir in possession of the said entailed lands and barony, to execute in favour of the petitioner, or any other person she may think fit, a bond and disposition in security over the said entailed lands and barony of Glenkindie, Morlich, Bellnaboth, and others, other than the mansion-house, offices, and policies thereof, or over some sufficient portion of the said estate, other than as aforesaid, for the whole or otherwise for three-fourths of the said sum of £1900, together with such sum as your Lordships may find to be the actual or estimated amount of the cost of this application and the proceedings therein, and of obtaining the loan and granting security therefor, and so in proportion for any greater or less sum, together with the actual or estimated cost above referred to or a proportion thereof added thereto, with the interest thereof at the rate of £5 per centum per annum from the date of your Lordships' decree in this petition till paid, and with corresponding penalties.”

The Entail Amendment Act, 1875 (38 and 39 Vict. cap. 61), by section 8, provides—“It shall be lawful for an heir of entail in possession of an entailed estate in Scotland, holden by virtue of any tailzie dated prior to the 1st day of August 1848 (notwithstanding any provisions to the contrary contained in the tailzie), who has obtained the authority of the Court to borrow money under this Act on the security of the estate, to charge the fee and rents of such estate other than the mansion-house, offices, and policies thereof, or the fee and rents of any portion of such estate other than as aforesaid, with a bond of annual rent, binding himself and his heirs of tailzie to make payment of an annual rent for twenty-five years from and after the date of such authority of the Court; or, where the money has been consigned as aforesaid, from and after the expiration of two years from the date of consignation, such annual rent to be payable by equal moieties half-yearly, and to be at a rate not exceeding £7, 2s. per annum for every £100 so authorised to be borrowed, and so in proportion for any greater or less sum; or, where the improvements were executed before the date of the application to the court in the option of such heir in possession, and in lieu of such bond of annual rent, with a bond and disposition in security over such estate or any portion thereof other than as aforesaid, for two-thirds of the sum on which the amount of such bond of annual rent, if granted, would be calculated, in terms of this Act.”

Section 11 provides—“Where any heir of entail in possession of an estate in Scotland, holden by virtue of a tailzie dated prior to the 1st day of August 1848, shall have executed improvements on such estate of the nature contemplated by this or any other Entail Act, as the case may be, and shall have died after the passing of this Act without having charged the estate with the amount which he is entitled to charge of the sums expended on such improvements, it shall be lawful for any person to whom such heir of entail may have expressly bequeathed, conveyed, or assigned such sums, or any part thereof, to make application by summary petition to the court, praying the court, after such inquiry as to the court shall seem proper, to find and declare that the sums specified in the petition, or any part thereof, have been expended on improvements on the said estate by the deceased heir of entail; and that the petitioner is in right thereof; and to decern and ordain the heir in possession of such entailed estate to execute in favour of the petitioner, or of any other person such petitioner may think fit, a bond and disposition in security over the said estate other than the mansion-house, offices, and policies thereof, or over some sufficient portion of the said estate other than as aforesaid, for the amount with which the deceased heir of entail himself might, under the provisions of this Act, have charged the estate.”

The Entail (Scotland) Act, 1882, section 6, enacts —“(1) Where application is made for authority to borrow and charge for improvement expenditure, the Court or Sheriff may grant authority to execute bonds and dispositions in security for three-fourths of the sum authorised to be borrowed, and whether the improvements shall have been executed at the date of the application or are contemplated.”

The petition was opposed by General Leith, who contended that he was only bound to grant

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a bond and disposition in security for three-fourths of the improvement expenditure.

On 12th June 1888 the Lord Ordinary ( Trayner) pronounced this interlocutor—“Finds and declares that the sum of £1853, 4s. l0d. has been bona fide and properly expended on improvements of a permanent nature, and such as are contemplated by the Entail Amendment (Scotland) Act, 1875, upon the entailed lands of Glenkindie and others mentioned in the petition, by the deceased Alexander Leith ( tertius), while heir of entail in possession of said lands, and that the petitioner is in right thereof in virtue of a codicil to the trust-disposition and settlement of the said Alexander Leith, dated 21st December 1883, whereby he expressly bequeathed and conveyed the same to her: Decerns and ordains the respondent General Robert William Disney Leith, the heir of entail now in possession of the said lands, to execute in favour of the petitioner, or of any other person she may think fit, a bond and disposition in security over the said lands, other than the mansion-house, offices, and policies thereof, for £1853, 4s. 10d., together with the sum of £136, 14s. l0d., being the estimated cost of the application, and obtaining the loan, and granting security therefor, the said two sums amounting together to the sum of £1989, 19s. 8d., with the interest thereof at the rate of £5 per centum per annum from the date of this decree till repaid, and with corresponding penalties, such bond and disposition in security binding the said General Robert William Disney Leith as heir of entail in possession foresaid, and his heirs of entail in their order successively, to repay the principal sum therein, with interest and penalties as aforesaid, and containing power of sale in ordinary form, and also containing all clauses usual and necessary in bonds and dispositions in security over estates in Scotland held in fee-simple: Provided always, that the said sum shall only be deemed to be a debt against the entailed estate and the heirs of entail therein, and with and under the provisions and declarations applicable to such bonds and dispositions in security contained in the statutes, and decerns: Remits to the reporter to adjust and see executed such a bond and disposition in security, and to report.

“ Opinion.—The late Alexander Leith was at his death the heir of entail in possession of the lands of Glenkindie and others, and had prior to his death expended a sum of £1853, 4s. l0d. in improvements on the entailed estates, which he would have been entitled to charge thereon under the provisions of the Entail Acts. He expressly bequeathed to the petitioner the said sum, and assigned to her the right and interest competent to him to charge the entailed estates therewith. She now petitions the Court to ordain the heir of entail in possession to execute in her favour a bond and disposition in security over the entailed estate (except the mansion-house and policies) for the foresaid sum. The heir of entail in possession objects to the prayer of the petition being granted, but is ready to grant a bond for three-fourths of the said improvement debt, which he maintains is all the petitioner can demand.

The determination of the question between the parties depends upon the construction of the 8th and 11th sections of the Entail Amendment Act, 1875. By the 11th section it is provided that any person in the position of the petitioner is entitled to the order or decree of the Court ordaining the heir of entail in possession to execute in his or her favour a bond and disposition in security over the estate, other than the mansion-house, &c.,‘for the amount with which the deceased heir of entail himself might under the provisions of this Act have charged the estate.’

“By the 8th section power is given to an heir of entail to charge the estate with improvement expenditure in one or other of two modes. He may charge the estate with the full amount of his expenditure by means of a bond of annual rent, under which the whole expenditure and interest will be paid off in twenty-five years, or he may grant bond and disposition in security in common form for three-fourths of the amount of the improvement expenditure.

“The respondent now contends that as the heir while in possession could not have charged the estate with a bond and disposition in security for more than three-fourths of the improvement expenditure, so now his assignee or representative is not entitled to a bond and disposition in security over the estate for any larger amount. The question is not, however, what the heir while in possession could charge by way of bond and disposition in security, but what he could charge in any way, the statute providing that the assignee of the deceased heir is entitled to a bond ‘for the amount with which the deceased heir of entail himself might have charged the estate.’ If he could competently have charged the estates in any mode with the whole expenditure, his representative or assignee is now entitled to have that done. The measure of the assignee's right is the amount which the deceased heir could have charged upon the estates irrespective of the mode in which that charge was made.

The respondent maintains that charging the estate with an annual rent is not charging the estate with the expenditure itself. In my opinion the distinction thus drawn is not a good or sound distinction. The bond of annualrent (Jurid. Styles,i. 440) proceeds upon the narrative that the heir charging has received from the person in whose favour the bond is granted the full amount of the expenditure, which sum he binds himself and the heirs of entail to repay, with interest, in twenty-five years, by half-yearly payments of fixed amount, and in security of these payments the entailed estates are conveyed. The whole expenditure is thus charged upon the estates whenever the bond of annual rent is granted or recorded. No doubt the right of the creditor in one case is limited to insist on repayment of his debt by certain instalments, while in the other he may at once demand payment of his debt in full. But that difference in the right of the creditor does not affect the fact that under the bond of annual rent the heir of entail had validly charged the entailed estates with the full amount of the improvement expenditure, and if he could do that his assignee is entitled to have it done in her favour. This can only be done by means of a bond and disposition in security, for the Act has so prescribed.”

General Leith reclaimed.

At advising—