Scottish Court of Session Decisions

By disposition dated 20th December 1880, John M'Bride disponed to and in favour of the Clydesdale Bank “for sundry good and onerous causes and considerations … heritably and irredeemably,” certain subjects forming Nos. 39 to 55 M'Alpine Street, Glasgow. The disposition was unqualified in any way and was ex facie absolute.

By an agreement dated 25th January 1889 between the bank and M'Bride, the latter agreed to make payment to the bank of the sum of £500 by instalments of a certain amount, and the bank undertook that when the whole of the said sum of £500 should have been paid, they would reconvey and surrender their interest in the M'Alpine Street property to M'Bride.

By disposition and reconveyance dated 1st March 1893 the Clydesdale Bank, on the narrative that by the disposition of 1880 M'Bride had disponed to them the subjects therein mentioned, and, “considering that although said disposition was ex facie absolute, it was truly granted in security of an advancement of £2500 made by us to him, and now seeing that he has made payment to us of certain sums of money which we have agreed to accept in full satisfaction of said advance,” disponed and reconveyed the said subjects to M'Bride with their whole right, title, and interest in the same.

In the end of 1889 the Caledonian Railway Company began to construct a sewer in M'Alpine Street uuder the provisions contained in sub-section L of section 41 of the Glasgow Central Railway Act 1888, whereby it was provided that where any of the works authorised by the Act should interfere with the sewers under the control of the corporation, the company should provide substituted works, the corporation being bound to communicate their powers so far as necessary.

In May 1893 M'Bride raised an action against the Caledonian Railway Company in the Sheriff Court at Glasgow for payment of £5500 as damages, averring that owing to the “reckless, negligent, and unskilful manner” in which the company had conducted their work in certain particulars, they had seriously damaged the buildings on his property.

The defender pleaded, inter alia—“(1) No title to sue.”

On 13th September 1893 the Sheriff-Substitute ( Spens) allowed a proof.

Page: 498↓

The pursuer appealed for jury trial, and proposed as the issue for trial of the cause, whether the injury to his property had been caused “through the fault of the defenders in their operations” in M'Alpine Street?

Argued for the pursuer—His title was good, because (1) at the time when the damage was inflicted he was the holder of a beneficial right in the property. It was clear from the deeds that the conveyance to the bank was merely in security for a debt, and that the real right of property was in the pursuer. During the whole period he had the occupancy and care of the building. The bank could not have raised an action, for if they had done so they would have been met by the defence that the agreement of 1889 showed that they had not the beneficial right in the property— Giles v. Lindsay, February 27, 1844, 1 Ross' Cases (Land Rights), 479, showed that the substance and reality of the right of property must be considered. The sequestration cases of Whyte v. Murray, November 16, 1888, 16 R. p. 95; and Geddes v. Quistorp, December 21, 1889, 17 R. 278, were analogous, as showing that where a trustee had been discharged, but the bankrupt had not been reinvested, the latter had a title to sue as having the radical right in the estate— Bell v. Gow, December 19, 1862, 1 Macph. 183. The case of The Heritable Reversionary Company was really in the pursuer's favour, as it showed that the Court would look to the real rights of parties, and not merely to the form of the titles. (2) Alternatively, the disposition of 1893 gave him a title to sue. The bank by that disposition stated they were only security holders, and reconveyed the property to the pursuer with all their rights in the same. He had a good title to sue as their assignee.

Argued for the defenders—The bank had been ex facie owners of the property during the time in which the operations complained of were going on, and it had been reconveyed to the pursuer without any mention of this claim. The bank had been absolute owners, with a simple obligation to reconvey on the payment of a certain sum. This obligation in no way qualified their absolute ownership till the payment was made. Any claim for injury arising during that ownership was a personal one, not transmitting by mere reconveyance, but only by express assignation. Even if the agreement of 1889 were looked upon as a back-bond, the disponee under an absolute disposition such as that of 1880 had the sole right to sue, only transmissible by assignation. This transaction was outside the category of a trust, and within that of absolute ownership only qualified by contract. It differed from a bond of disposition and security, and did not therefore come within the category of “pledge”— Caledonian Railway Company v. Watt, July 9, 1875, 2 R. 917; Heritable Reversionary Company v. Millar, August 7, 1892, 19 R. (H. of L.) p. 43; National Bank of Scotland v. Union Bank, December 18, 1885, 13 R. 380; December 10, 1886, 14 R. (H. of L.) p. 1. Form of Issue— The issue should be so expressed as to keep the jury in mind that the ground of action was the alleged negligence of the defenders.

At advising—