Scottish Court of Session Decisions

Lord Kinnear—This is an appeal from a decision of the Sheriff of Aberdeen in an action at the instance of a tenant against his landlord, but the action is not founded on the contract of lease, but on a separate and distinct contract which, so far as the record goes, has no necessary connection with the lease. The allegation is that when the tenant removed from the farm the defender entered into a submission with him to fix the value of the grain crop upon the farm, that upon the value being ascertained the landlord took the grain crop over at the fixed sum of £136, 7s. 7d., and that at the date of the valuation the pursuer was due to the defender a balance of rent amounting to £62, 6s. 7d. Then the pursuer says that he is willing to admit his liability for the rent, but that the defender refuses to pay him the balance that still remains of the valued price of the grain crop. I agree with the Sheriff that the only defence to this action, which is that the tenant is liable in damages for mis-cropping and failure to upkeep buildings, is an attempt to set off an illiquid claim of damages against a liquid claim of debt. The case appears to me to afford a very simple instance of the rule that no such right of retention or claim to set off can be allowed. The landlord has bought and received the grain crop at a fixed price, and he then claims to set off, against the right of the seller to obtain payment of the price, an illiquid counter-claim of damages. Such a defence cannot be sustained.

The Sheriff refers to a series of cases in which it was held that a claim for rent might be compensated by a counter-claim on the part of a tenant, though the amount of the rent due was fixed by the lease, and therefore was so far liquid. But these decisions have no application to the present case. They are all illustrations of the rule that one party to a mutual contract cannot enforce the obligations in his favour while at the same time he refuses to implement the counter obligations to the other party. It does not affect that rule that the landlord's claim for rent is ex facie of the lease a liquid claim, because the case against him in this class of cases is that the full amount so fixed is not due, the tenant not having received the full consideration, in respect that he has not been put in full possession of the subjects of the lease.

The case of Lovie v. Baird's Trustees, on which the appellant founded, appears to me simply another illustration of the same rule. But I think that there was in that case another ground very clearly distinguishing it from the present. In that case the tenant was in arrear of rent, and the landlord had claims for rent against him extending over a considerable period. The tenant met these by counter-claims which were illiquid in themselves, but before the controversy was at an end the termination of the lease arrived, and as a consequence the tenant was required to give over to the landlord (or to the incoming tenant) certain houses, grass, fallow land, and dung, upon condition that he should be paid, “according to the valuation of men mutually chosen as aforesaid, for the value of all sown grass, for the dung made upon the farm subsequent to the time of turnip sowing in the previous year, for the value of labour done to the break for green crop or fallow land in that year.” Now, upon that supposition the value of these things was fixed, and the tenant then brought an action against the landlord for the amount of the valuation, irrespective altogether of the landlord's claims against him. It was held that the landlord was entitled to a proof of his claims and to retain the amount of the valuation. But then the landlord's claim was just as liquid as the tenant's, for his claim was for arrears of rent, which was a liquid sum; the tenant's was for the amount of the valuation. But both parties were claiming on counter obligations in a mutual contract. In this case the contract on which the tenant founds is separable, if not separate, from the lease. The landlord, according to his own statement, has received the entire consideration for the money which he is now asked to pay. Accordingly, this case does not fall under the rule of the cases to which I have adverted.

It appears to me, therefore, that the judgment of the Sheriff in the action at the instance of the tenant must be affirmed.

The Lord President, Lord Adam, and Lord M'Laren concurred.