Scottish Court of Session Decisions

The trustees of the late Sir George Beresford of Ballachulish, as proprietors of the slate quarries there, in 1878 entered into a fifteen years lease of said quarries with Dr Donald Campbell, to run until Whitsunday 1893. The lease contained, inter alia, the following provisions—“Further, the said Donald Campbell having paid to the said first party [the trustees] the sum of £3792, 8s. sterling, being one-half the amount of valuation of the engines, waggons, drums, rails, tools, horses, carts, and other moveable plant for the said quarries, as the same were taken over by the said first party from James Gardner, the last person in possession of the said quarries (a full list of all which has been made out and signed by both parties as relative hereto), the same shall be held to be the joint-property of the proprietors and tenant; and it is hereby agreed by and between them that during the currency of this lease, so often as the said plant now on the quarries, or other plant hereafter to be purchased as after mentioned, shall become deteriorated or unfit for use, or requiring to be renovated by other plant, the same shall be sold by the said Donald Campbell, and one-half of the free price thereof shall be paid to the said first party and their foresaids, and the other half retained by the said Donald Campbell; and on the other hand, should the necessity arise for the purchase of new plant, either in the opinion of the said parties, or, in the event of their differing in their opinion, of a person mutually chosen, whom failing to the arbiters hereinafter appointed, the price or prices and expense thereof shall be borne by the said parties in equal moieties, and the same shall be held to be the plant of the said quarries, and maintained as such as after provided; and the said first party or their foresaids shall be bound, at the termination of this lease, to pay to the said Donald Campbell or his

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foresaids one-half of the value of the engines, waggons, drums, rails, tools, horses, carts, and other moveable plant, and stock of slates which may then be on said quarries … Further, the said Donald Campbell binds and obliges himself and his foresaids to uphold and maintain … the plant, comprising railways, tramways, inclines, waggons, rails, and others in full working order and quantity, and to work the said quarries in an efficient and workman-like manner, and without any unnecessary waste of material, during the whole period of this lease.”

In December 1891 the Hon. James Master Owen Byng and another, the marriage-contract trustees of Admiral and Mrs Lucas, as assignees of a bond and disposition of £10,000 over the lands of Ballach-ulish granted in 1879 by Sir George Beresford's trustees, raised an action against Ebenezer Erskine Scott, C.A., trustee under a deed of direction and declaration of trust granted by the said Sir George Beresford, for payment of the £10,000, upon which they obtained decree as craved in June 1892.

On 3rd December 1891 they caused an arrestment on the dependence of the action to be used in the hands of Dr Donald Campbell, lessee of the quarries, to the extent of £15,200. Further, upon 18th May 1893 they, in virtue of their decree, arrested the sum of £15,000 in the hands of the said Donald Campbell, and on 31st May 1893 they brought an action of forthcoming against the said Donald Campbell as arrestee, and the said E. E. Scott as principal debtor, concluding as follows—“ Therefore the defender Donald Campbell, in whose hands arrestments have been used, ought and should be decerned and ordained, by decree of the Lords of our Council and Session, to make payment and delivery to the pursuers of the sum. of £15,000, or such other sum or sums as may be owing by him to the defender Ebenezer Erskine Scott, as trustee foresaid, and arrested in his hands upon 3rd day of December 1891, and upon the 18 th day of May 1893, at the instance of the pursuers, or at least of such part thereof as shall satisfy and pay the pursuers the principal sum of £10,000, with interest on said principal sum of £10,000 at the rate of £5 per centum per annum from Martinmas 1885, and payable half-yearly at Whitsunday and Martinmas in each year thereafter, together with interest at the rate of £5 per centum per annum on each half-yearly sum of interest becoming due at the terms of Whitsunday and Martinmas from and after the said term of Martinmas 1885, down to and including the term of Martinmas 1891, but with and under the deduction of two sums of £200 each, making £400 in all, paid to the pursuers on 5th March 1887 and on 1st December 1887, and of a corresponding deduction of interest in respect of such payments from the amount of interest, all as decerned for in an interim decree obtained by the pursuers in an action before the Lords of our Council and Session against the principal debtor Ebenezer Erskine Scott, dated at Edinburgh the 29th day of June 1892, and extracted the 16th day of August 1892; and such further orders for production, delivery, inspection, sale, consignation, and payment with reference to the goods or property of said Ebenezer Erskine Scott in the possession of the defender Donald Campbell, should be pronounced by our Lordships as may seem necessary for satisfying the said claim of the pursuers.”

The pursuers, after setting forth the facts given above, averred that—“(Cond. 4) The said lease terminated at Whitsunday 1893, and there is now in the possession of the said arrestee, the defender Donald Campbell, a large quantity of valuable plant, consisting of engines, waggons, drums, rails, tools, horses, and carts connected with the working of the quarry, which plant is the property of the principal debtor, and which the arrestee is under obligation to deliver to the principal debtor. In terms of said lease, the tenant was bound to deliver the plant to the proprietor at the term of Whitsunday 1893, and the defender Scott was bound to make certain payments in respect thereof. (Cond. 6) … Under the said arrestment the foresaid plant in the quarries of Ballachulish was attached. The plant is now and has since the commencement of the lease been wholly in the possession of, and subject to the control of, the defender Campbell. (Cond. 7) The said arrestee Dr Campbell refuses to make payment to the pursuers of the sums in his hands arrested as condescended on, and the present action has been rendered necessary in order to make the said sums forthcoming to the pursuers.”

They pleaded, inter alia—“(1) The pursuers having arrested in the hands of the arrestee the sums owing, or goods and gear deliverable by him to the principal debtor, they are entitled to have the same made furthcoming in satisfaction of their debt, to the extent due by the arrestee to the principal debtor. (2) The present action having been rendered necessary for recovery of the sums due by the defender and principal debtor to the pursuers, decree should be pronounced, with expenses, as concluded for. (5) On a sound construction of the said lease, the plant connected with the quarries at the termination of the lease was the property of the lessor.”

Answers were lodged for both defenders in which it was explained that the plant in the quarries was not attached by the arrestments. Said plant was the joint property of Dr Campbell, the tenant of the quarries, and of Mr Scott, the trustee, and did not form part of the subjects let to Dr Campbell. Also, that although the original lease expired at Whitsunday 1893, by agreement between the parties in November 1891, it had been extended until Whitsunday 1894.

It was pleaded for the defenders—“(1) The averments of the pursuers being irrelevant and insufficient to support the conclusions of the summons, the action should

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be dismissed. (2) The arrestee not having had in his hands at the date of said arrestments any arrestable funds or goods belonging to the principal debtor, the action should be dismissed.”

Upon 5th December 1893 the Lord Ordinary ( Kincairney) pronounced the following interlocutor:—“Having considered the cause, Finds that the pursuers have competently arrested the right to the sole property of the plant referred to on record, arising to the common debtor at the close of the lease between his predecessors in the lands therein mentioned and the arrestee, in terms of the provisions of the lease libelled: Before further answer, allows to the defenders a proof of the averments in answer 4, to the effect that the lease in question was extended from Whitsunday 1893 to Whitsunday 1894, and appoints the same to proceed on a day to be afterwards fixed.

“ Opinion.—This is an action of furthcoming, signeted on 31st May 1893, based on two arrestments, the one dated 3rd December 1891, used on the dependence of an action raised by the present pursuers, trustees of Admiral and Mrs Lucas against Ebenezer Erskine Scott, C.A., trustee for Sir George de la Poer Beresford, and another, dated 18th May 1893, proceeding on an extract-decreet obtained in that action. The arrestments were used in the hands of Dr Donald Campbell, and this action is brought against Mr Scott as common debtor and Dr Campbell as arrestee, and is defended by both.

By lease dated in 1878, the then trustees of Sir George de la Poer Beresford, with consent of the beneficiaries under his trust-deed, let to Dr Campbell the slate quarries of Ballachulish for fifteen years from Whitsunday 1878, the ish of the lease being Whitsunday 1893.

The lease contains the following provision in regard to the plant of the quarry—[ This provision is given above].

The pursuers maintained that the plant in the quarry has been arrested by both arrestments, and that since the commencement of the lease it has been wholly in the possession of Dr Campbell, and subject to his control. They have pleaded—‘(1) The pursuers having arrested in the hands of the arrestee the sums owing or goods and gear deliverable by him to the principal debtor, they are entitled to have the same made furthcoming in satisfaction of their debt to the extent due by the arrestee to the principal debtor.’

The defenders plead that there were not in the hands of the arrestee at the date of the arrestments any arrestable funds or goods belonging to the common debtor, and that the action should therefore be dismissed.

The first question then is, were the arrestments competent and effectual? In considering this question, it does not seem to me to be necessary to distinguish between the two arrestments. Either, if competent and effectual, might be a good warrant for this action of furthcoming, and the defenders' objections are common to both. The pursuers say that the later arrestment was used ob majorem cautelam.

The pursuers maintained that it resulted from a sound construction of the lease, that the plant was truly the property of the landlord, and not at all the property of the tenant; and that therefore being moveable property, belonging to the common debtor in the possession of the tenant, it was duly arrested in his possession.

I cannot assent to that argument. The deed declares expressly that the plant shall be during the lease the joint property of the landlord and the tenant. There is not the slightest reason to suggest that the parties designed to conceal their true relations or to make them appear other than they really were. It was competent for them to contract that the plant should be joint property. They have contracted to that effect expressly, and there seems no reason why the words of the contract should not receive the effect according to their unambiguous meaning.

The pursuers further maintained, that supposing the plant to be at the date of the arrestment the joint property of the landlord and tenant, it was competent to arrest it. I do not think that it can be asserted as an abstract and general proposition that it is competent for the creditor of one of two joint owners of moveable property to arrest the subjects of that joint property, or even the interests of his debtor in that property, and to bring it to sale by means of a furthcoming. It is true that it has been held competent to arrest shares in a joint stock company— Sinclair v. Staples, January 27, 1860, 22 D. 600. But in that case the shares of the common debtor could be brought to a sale without affecting the interests of the other shareholders. In the present case I am unable to see how anyone article of the plant in this quarry could be brought to a sale if the whole stipulation of the parties had been that it should be joint property. It would not be possible to sell any part of the property of Dr Campbell in order to pay the debts of Beresford's trustee. In Fleming v. Twaddle, December 2, 1828, 7 S. 92, it was held incompetent to poind joint property for the individual debt of one of the joint owners; and it must, I think, be equally incompetent to arrest it and follow out the arrestment by a furthcoming and sale.

But then it is provided by the contract that at the termination of the lease the landlords (that is now Mr Scott as Beresford's trustee) should pay to Dr Campbell one-half of the value of the plant ‘which may then be on said quarries.’ The contract contains no express provision that the plant should on such payment become the property of the landlord; but I think that such a declaration may, and indeed must of necessity be inferred. The contract therefore is so conceived as to eventuate, if its stipulations are duly carried out, in this, that the plant which before the termination of the lease was the joint property of the landlord and tenant, shall then, on the stipulated payment by the landlord, become the sole property of the landlord, and that

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the tenant shall then be bound to deliver the plant to the landlord, or rather shall leave it on the landlord's property, and shall himself quit the occupation of the property and the possession of the plant; and the difficult and somewhat novel question of law arises—Is this right of the landlord so resulting from the stipulations of the contract an arrestable right? If it is, then I apprehend it has been arrested. I think the first plea-in-law for the pursuers sufficiently, although not very aptly, expresses the pursuers' contention that this ultimate right of the landlord has been arrested.

The right thus sought to be arrested was not at the date of either arrestment a right prestable by the landlord. But it is established that a personal interest may be arrested although no sum be payable on account of it at the date of the arrestment. The contents of a policy of insurance were held validly attached by an arrestment used between the date of the last premium paid and the death of the person insured— Strachan v. M'Dougle, June 9, 1835, 13 S. 954. Again, Lord Gifford as Lord Ordinary in Bankhardt's Trustees v. Scottish Amicable Society and Duncan, Jan. 21, 1871, 9 Macph. 443, held that an arrestment of a policy of insurance used in the hands of the insurance company during the life of the person insured was effectual although a period for payment of the premium had intervened between the date of the arrestment and the date of the furthcoming, and he found that the arresters were entitled to have the principal debtor's interest in the policy sold and the price made furthcoming. So, bills on a third party, for which the holder is accountable to the common debtor, are arrestable before the bills have been paid— Gordon v. Innes, February 3, 1740, M. 715; Lothian v. M'Cree, February 27, 1828, 7 S. 72. On the same principle rents and annuities are arrestable currente termino.

A case still more in point is Marshall v. Nimmo, December 18, 1847, 10 D. 328. There the creditor of a slater, who had contracted to slate a roof for the arrestee, was held entitled to arrest the sum which would fall due under the contract, although it was not then due, and might not become due at all, as, for example, if the slater had not performed his contract. Here the right of the common debtor was held arrestable although not then prestable, and although contingent and indeed dependent on the actings of the common debtor. That case is closely applicable. But in it the eventual right of the common debtor under the contract was for a sum of money, and here it is for certain moveable property. That, I think, makes no difference.

The defenders maintained that furniture or plant belonging to a landlord was not arrestable in the hands of a tenant, but was capable of being attached by poinding, and they quoted the case of Davidson v. Murray, December 18, 1784, M. 761, which at first sight appears to decide that furniture in possession of a tenant could not be arrested by the creditors of the owners of the furniture. The pursuer maintained that the case was not good law, and had not been followed. But it is quoted both by Erskine and Bell without disapproval. I do not, however, think that it decided that point. The common debtor was tenant of a house, and the arrestee was his sub-tenant, and the furniture of the common debtor was let to the arrestee along with the house. The arrestments were used after the principal lease had expired, and therefore after the sublease had fallen with it, and the arrestee was therefore possessing the house and furniture precariously, without any title, and under no contract, and in these circumstances it was held that the furniture must be regarded as really in the possession of the common debtor, but the case does not, in my opinion, decide that furniture possessed under a lease would not be arrestable.

The present case presents the further peculiarity that according to the conception of the contract, the same event which converts the joint right to the plant into a sole right in the landlord also determines the possession of the tenant, and it may be that arrestments of the plant on the ground used on the expiry of the lease would be bad, and that then poinding would at that time be the appropriate diligence on the authority of Murray v. Davidson, because then the plant would be no longer in the possession of Dr Campbell under a contract, so that it was argued that as the plant could not be arrested before the expiry of the lease because it was joint property, nor after the expiry of the lease because it then ceased to be in the possession of the tenant, it could not be arrested at all. I think this difficulty is met by the consideration that the diligence of arrestment attaches a right in the person of the arrestee at its date, not a right, or money, or a moveable coming into his hands afterwards. It is effectual at the very first, or not at all. In this case the arrestments cannot correctly be said to have attached the plant either at the date of the arrestments or at the close of the lease. What they did attach was the obligation by Dr Campbell to leave the whole plant for the landlord at the end of the lease, an obligation existing at the date of the arrestments, and, as I think, attached by them.

I am therefore prepared to find that the arrestments used were habile to attach the claim to the sole property of the plant arising to the common debtor at the close of the lease.

But the defenders have averred that in November 1891—that is, before either arrestment—the lease was extended by agreement for the year from Whitsunday 1893 to Whitsunday 1894. It was maintained on the one hand that this was an averment of a lease for a year, capable of being proved by parole, and, on the other hand, that being a contract regarding heritage, and differing from the ordinary case of a yearly lease, it could not be constituted or proved without writing.

I can see no good ground for holding that the ordinary rule that a lease for one

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year may be proved by parole should not apply in this case. I think that the peculiarity of the case, or what is unusual in it, namely, that the lease agreed on was not to commence for more than a year after the agreement, does not affect the mode of proving it. And although it was maintained that the averments were too vague and indefinite to be admitted to proof, I am of opinion that a proof cannot be refused on that ground.

It appears to me therefore to be necessary, first of all, to ascertain what is the true ish of this lease. If it shall turn out to be Whitsunday 1893, then the furthcoming will proceed in the ordinary way. But if it shall be found that the ish has been postponed till Whitsunday 1894, I think that it will not on that account be found necessary to dismiss this action as premature, but that it will be sufficient to sist it until the lease shall come to an end.

It was suggested in argument that the lease might be continued from year to year for an indefinite period. No further extension, however, has been made, and it will be time enough to consider the effect of such an extension of the lease when it is made, when it will fall to be considered whether such an extension of the lease could be allowed to defeat the pursuers' arrestments.”

The defenders reclaimed, and argued that the action was irrelevant and incompetent.

The pursuers and respondents asked to be allowed to amend.

At advising (upon 16th February 1894)—