Scottish Court of Session Decisions

In 1852 John Auchincloss senior used £65 which belonged to his three children then in minority, and with concurrence of his wife instructed William Duncan, S.S.C., Edinburgh, to prepare a bond and disposition in security in their favour for that amount over certain heritable property belonging to Mrs Auchincloss but which she held only on a personal title. The bond was prepared and executed but was not recorded until November 1860. Mrs Auchincloss's title was never feudalised, and the property was sold in April 1860. In March 1893 the First Division of the Court of Session decided that the bond gave no real security over the subjects. In November 1893 John Auchincloss junior and his sister, who were the minor children in 1852 (the third having died) brought an action against the said William Duncan for payment of £130, being two-thirds of the sum of £65, with interest from 1852. They averred:—“(Cond. 3) On 13th April 1852, when the pursuers and their now deceased sister were in minority, their father without any consultation with them borrowed the amount of their shares of their grandfather's estate. He, however, as curator for the pursuers and their said sister, employed and instructed the defender to draw up a bond in favour of the pursuers and their said sister for the sum borrowed, and further he and his wife directed the defender to prepare for behoof of the pursuers and their said sister in security a disposition of certain subjects at 71 Rose Street, Edinburgh, belonging to Mrs Auchincloss. The defender prepared a bond and disposition in security, as directed, in favour of the pursuers and their said sister. The pursuers' father in employing the defender to draw up the said deed was acting as the natural guardian of the pursuers, and his instructions to the defender were given for and on behalf of the pursuers and their said sister. (Cond. 4) It was the defender's duty, acting on behalf of the pursuers and their said sister, who were at the time minors, and utterly ignorant of what was being done with their money, to take care that a good title was obtained for them to the property disponed to them in security for the loan to their father. This he entirely failed to do. The pursuers' father did all he could to give the pursuers a proper security for the money he had borrowed. The property given in security was of adequate value, and the pursuer's failure to recover the sum due to them was attributable solely to the neglect and fault of the defender. (Cond. 10) The defender, as law-agent employed for the pursuers, then minors, was under the obligation to see that the security granted for their money was made valid and effectual. This he failed to do. He first delayed for eight years to record the bond in the Register of Sasines, and then he recorded it ineptly. The pursuers have consequently lost the sum now sued for through the negligence of the defender.” They explained that they had only become aware of the existence of the bond in 1889.

Pleaded for pursuers—“(1) The pursuers having lost the sum sued for through the negligence of the defender, decree should be granted in terms of the conclusions of the summons. (3) The defender having been employed as law-agent on behalf of the pursuers by their natural guardians during their minority, is liable to them in damages for loss sustained by them in consequence of his failure to perform properly his duties in that capacity.”

Pleaded for the defender—“(3) No relevant case stated. (6) The defender not having acted as agent for the pursuers, he ought to be assoilzied.

Upon 1st March 1894 the Lord Ordinary ( Wellwood) sustained the third plea-in-law for the defender and dismissed the action.

“ Opinion.—In this action the pursuers seek to hold the defender, who is a Solicitor before the Supreme Courts, personally liable for alleged professional negligence, of which he is said to have been guilty upwards of forty years ago, in having failed to take care that a good title was obtained for them to certain heritable subjects for which a bond and disposition in security in their favour was granted by their father and mother in the year 1852. Amongst other defences, the defender pleads that the pursuers' averments are irrelevant, and also, ‘(6) That not having acted as agent for the pursuers, he ought to be assoilzied.’ I am of opinion that the pursuers have not relevantly averred that the defender was employed by them or on their behalf.

It seems from the pursuers' statement that a legacy was left by James Mowat, the pursuers' maternal grandfather, to the children of the marriage of the pursuers' father and mother. The pursuers' father obtained possession of the shares which fell to the pursuers, and apparently used them for his own purposes. The pursuers' statement is that he borrowed the amount of their shares while they were in minority; but they also say—and that is part of their case—that they were not aware of this until recently, and that they were not consulted in the matter at all. When he thus appropriated—I do not use the word in a bad sense—or used the shares, the pursuers' father, being anxious that the pursuers should have some security for the money, instructed the defender to prepare a bond and disposition in security in their favour over certain heritable subjects to which the pursuers' mother had right. The bond was prepared by the defender, and executed by Mr and Mrs Auchincloss. The complaint is that whereas Mrs Auchincloss held the subjects disponed in security on a personal title only, the defender failed

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to complete her title as he was bound to do, and did not even record the bond until November 1860, by which time the property had been sold by Mr and Mrs Auchincloss to a Mr Findlay, the result of which was that it was ultimately held by the Court that the bond gave the pursuers no real security over the subjects. I assume on the question of relevancy that the defender was negligent in the respects alleged.

The question is, whether the pursuers have relevantly averred that the defender was employed by them or on their behalf; in other words, whether in order to support an averment of employment by or on behalf of a minor it is relevant and sufficient to aver that the agent was instructed to do the work in question by the minor's curator without the minor's knowledge, and for the purpose of giving security for a sum of money belonging to the minor, the use of which the curator had taken also without the minor's knowledge and permission.

I do not think that such an averment is relevant. The powers of a father as administrator-in-law for his children are not in this respect different from those of any other guardian. A minor acts with consent of his curator; the curator cannot act by himself without the minor. Further, a curator cannot legally lend the curatorial funds to himself. Therefore when Mr Auchincloss instructed the defender to prepare the bond, it cannot be said with propriety that he gave instructions for and on behalf of the pursuers in the sense that in so doing he was acting as their curator. He was really acting as their debtor, and endeavouring to give them security for the money of which he had taken the use without their knowledge.

If it had been averred that the pursuers' father employed the defender with their knowledge and consent, there might have been a case for inquiry. But the pursuers' case is that they knew nothing about it; that they were kept in the dark. There is thus no room for implying authority from them to employ the defender. Such implied authority is negatived by their own statement.

No doubt the defender was employed to prepare the bond for their benefit, but that is not enough. It was necessary that the pursuers should aver and prove that the defender was employed by them or by their authority. This is clearly settled by the decision of the House of Lords in the leading case of Robertson v. Fleming, 1822, 4 Macq. 167. In that case there were facts alleged which apparently warranted an issue as to whether the agent was employed by or by the authority of the appellants. This appears from the terms of the judgment and remit—4 Macq. 214. But the facts alleged were very different from those stated in the present case. A person named Hamilton being desirous to raise money, applied for an advance to certain moneylenders, who agreed to make it on the borrower obtaining three cautioners. The three respondents agreed to become cautioners, being aware that Hamilton had leasehold property which if properly secured for their benefit would keep them safe. Their statement was that Hamilton agreed to complete the necessary security over this property, and that he employed Robertson, the agent, for their behoof. The issue sent to the jury was whether Robertson was employed by Hamilton ‘for behoof of’ the cautioners. The House of Lords held that the issue was improperly worded, on the ground that the words ‘for behoof of’ meant ‘for the benefit of,’ and were not equivalent to the words ‘by the authority of.’

Now, in the present case, as I read the pursuers' averments, it cannot be inferred from them that the defender was employed by them or by their authority, and on that short ground I think the case must be dismissed.

It appears from the pursuers' own statement that the value of the three pro indiviso shares belonging to them and their sister was only £65, and I think the probability is that much more than that small sum was expended by the pursuers' father on their upkeep and education.”

The pursuers reclaimed, and argued that they had stated a relevant case. 1. They had averred that the defender, the family lawyer, was instructed to prepare a disposition in security. That meant a valid and effectual security, not a mere form on a sheet of paper. 2. They averred that the father in instructing the defender was acting as his children's curator and on their behalf. He was giving them a bond for onerous considerations, and it was the agent's duty to see that they got a good security by completing the mother's title and recording the bond— Lang v. Struthers, 1822, 2 W. & S. 563; Haldane v. Donaldson, 1822, 14 S. 610; Robertson v. Fleming, 1822, 4 Macq. 167; Cann v. Willson, 1888, L.R., 39 C.D. 39.

Argued for respondent—1. He had no instructions to record the deed, and would not have been justified in doing so or in completing the title. This was a family arrangement intended to give the children a claim during minority. The father and mother might not wish to be hampered with a recorded deed. As it happened, when the children reached majority the property was sold. 2. There was no privity of contract between the defender and the pursuers. He was employed by their father, and not by them. To make him liable to them, even if there had been negligence, the averments as to employment would have required to be far more specific— Tully v. Ingram, November 10, 1891, 19 R. 65.

At advising—