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In an action for payment of the balance of certain cash advances made by the pursuer in connection with goods ordered upon his credit, and supplied to the defender, a merchant abroad, and for commission on said orders, it was pleaded that the sums sued for, at least so far as for commission, fell under the triennial prescription.
Held that the case was one of mercantile agency, and that accordingly the Act did not apply.
Question—Whether the Act was also elided by reason of written obligation?
In August 1890 Robert Ainslie Brown, S.S.C., Edinburgh, brought an action against his brother Edmund Lamb Brown, of Sydney, New South Wales, but residing in Leith, for payment of (1) the sum of £464, 15s. 4d., being the balance of advances made by the pursuer on behalf of the defender, and resting-owing by him; (2) the sum of £30, 17s. 4d., being balance of interest due on cash advances so made; and (3) the sum of £217, 15s., being the amount due to the pursuer as commission as after mentioned, with interest on said sums respectively.
The pursuer averred that the defender having gone out to Sydney as a shopman in an ironmongery establishment, sent home an order to the pursuer in April 1876 for goods such as he could dispose of in his spare hours; that goods were sent out in September 1876, which were duly paid for by the defender; and that thereafter, down to March 1886, the defender, “who had become established in business, regularly sent for and obtained, through the intervention, agency, and credit of the pursuer, large quantities of goods, amounting, with other consequent and relative disbursements, in the aggregate to £8772,
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19s. 6d. In a letter dated 25th November 1877, with reference to the said, order for goods, and a subsequent order, the defender wrote to the pursuer thus—‘I must return many thanks for your kindness in getting Matheson's goods sent off. I hope they will come safe, and trust will be able to send you the money soon, but will pay you at the rate of 6 per cent., and 2 for your trouble. I have had an invoice from Mr Hardie, and the ship has been out seventy-eight days now. She may be in any day. I have been thinking that you will be able to do what I have to do quite as well as he can, and if it will be the means of putting a few pounds in your way so much the better. I have paid him over £5 for the first transaction, and I may have to pay him ten times that during the year. If you think it worth your while, let me know by return. You would have nothing to do with the paying of the goods further than drawing a bill on me at six months, and of course seeing as to insuring and shipping. The Birmingham agents charge 2 1 2 per cent. and I would allow 2 per cent. on goods purchased through them, and 2 1 2 on goods purchased by you, such as Matheson's, or any goods you could purchase. You would require to give me all discounts — that is, trade and cash—and then there would be a clear understanding. I hope you will undertake this, and I am quite satisfied it will be of advantage to both. There is every chance my orders will get larger every month.’ This letter formed the terms on which the pursuer acted throughout for the defender. … The pursuer has charged interest at 5 per cent., and commission at 2 1 2 per cent., the original agreed-on rate. The pursuer during the foresaid period made many large cash payments and advances from time to time on behalf of the defender, at his request, in connection with the said goods, and was largely in advance for him, over and above the sums received for drafts upon him, on a limited credit he held with his bankers.” 1 2 The defender pleaded, inter alia—“(2) The sums sued for, at least so far as for commission, being prescribed, are only provable by writ or oath of the defender.”
The Act 1579, c. 83, enacts “That all actions of debt for house maills, mens' ordinaries, servants' fees, merchants' accounts, and others the like debts that are not founded upon written obligations, be pursued within three years, otherways the creditor shall have no action except he either prove by writ or by oath of his party.”
The Lord Ordinary ( Kyllachy) upon 20th March 1891 repelled said plea-in-law and allowed a proof.
“ Opinion.—In this case I am of opinion that the triennial prescription does not apply to the account sued for. In the first place, I incline to think that the action is laid upon a written obligation or written agreement. I do not say that is an obligation absolutely liquid, or that the effect of the documents founded on may not be displaced by production of the further documents which the defender undertakes to produce, but the action appears to be founded on a written obligation, and I think that is enough to elide the plea of prescription.
In the next place, the plea of prescription does not, I think, apply to a case of mercantile agency, and as I read this record, the relation of the parties was one of mercantile agency. No doubt if this had been a lawyer's account for legal business, in the course of which were included charges for commission incurred in the course of that legal business, I should have been bound to follow the case of Scott v. Gregory's Trustees, February 24, 1832, 10 Sh. 375, referred to by the defender, and to have held that the whole account must be dealt with as unum quid. But here there is no mixing up of commission with legal business. The commission charged is accessory to a proper mercantile account for mercantile business in connection with a mercantile agency, and therefore I think that I must repel the plea of prescription and allow a proof of the averments of parties, which will of course be before answer, keeping everything open.”
The defender reclaimed, and argued—The Act applied, because (1) there was not here a completed contract by writing such as the Act contemplated as an exception— Chalmers v. Walker, November 19, 1878, 6 R. 199. (2) The Act applied to merchants' accounts, accounts for services rendered, factors' accounts, stockbrokers' accounts— White v. Caledonian Railway Company, February 15, 1868, 6 Macph. 415 — and lawyers' accounts. The services here rendered partook of the nature of all these categories, even if they did not fall under any one category. The pursuer acted as a merchant, factor, broker, and adviser for the defender. The account was to be regarded as unum quid— Scott, supra; Grubb v. Porteous, 1835, 13 Sh. 603; Tod's Trustees v. Melville, 1836, 14 Sh. 432.
Argued for the respondent—The Act did not apply—(1) Because this was a case of mercantile agency, not of a merchant's account— Laing & Irvine v. Anderson, November 10, 1871, 10 Macph. 74, and cases of M'Kinlay v. M'Kinlay, December 11, 1851, 14 D. 162; Hamilton, 1795, M. 11,120; Anderson & Child v. Wood, Hume, 467, there cited. It was also work out of the scope of the pursuer's ordinary employment— Blackadder v. Milne, 1851, 13 D. 820, and Barr v. Edinburgh and Glasgow Railway Company, 1864, 2 Macph. 1250. (2) Because it was a case of contract founded upon writing. There must have been writing, because the defender was abroad. The writ of the defender was given above— Blackadder, supra; Chisholm v. Robertson. March 10, 1883, 10 R. 760; Bell's Prin., secs. 628, 629, and 630.
At advising—
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As to the second ground of judgment I entirely concur. If, as the Lord Ordinary says, this account was for legal business in which were included charges for commission, the ground of judgment could not be maintained, “but here,” as he says, there is no mixing “up of commission with legal business.” The “commission charged is accessory to a proper mercantile account for mercantile business in connection with a mercantile agency.” On that ground I am prepared to concur in the judgment of the Lord Ordinary.
On the other ground my opinion is not so strong, but I think I should be prepared to agree with him, although it is unnecessary to give an opinion upon it as we have already a sufficient ground of judgment.
As to the other ground of judgment, it is always difficult to decide whether correspondence constitutes a legal obligation. The question of being a written obligation only arises where otherwise the case would fall under the statute. I have no strong opinion as to that matter in this case. I should not be disposed to hold that to bring the case out of the statute obligatory words were necessary. A promise in writing would probably be enough to elide the statute, if expressed distinctly and with reference to a price or commission ascertained or ascertainable, but there are difficulties in the present case, and I agree that it is unnecessary to decide the question raised, there being another ground for holding the statute does not apply, upon which we are all agreed.
The Court adhered.
Counsel for Pursuer and Respondent— Jameson— Alison. Agent—Party.
Counsel for Defender and Reclaimer— Strachan— Craigie. Agents— Miller & Murray, S.S.C.