Scottish Court of Session Decisions

By disposition dated and recorded 28th February 1895, William Shaw, builder, Edinburgh, “heritable proprietor” of certain subjects in Gorgie Road, Edinburgh, disponed these subjects, “for certain good and onerous causes and considerations, not exceeding in all the sum of £600 sterling,” to Alexander Gordon, S.S.C., and his heirs and assignees whomsoever, heritably and irredeemably.

By disposition dated 6th and 7th December 1895 William Shaw, “proprietor” of the subjects after disponed, with consent and concurrence of Alexander Gordon, and Alexander Gordon for all right and interest competent to him in the subjects in virtue of the disposition in his favour of 28th February, and both with joint consent and assent, in consideration of the sum of £ 979, 13s. 9d. instantly paid to William Shaw as the price, disponed to Alexander Dryburgh, grocer, Edinburgh, two shops, 205 and 207 Gorgie Road. These shops were a part of the heritable subjects mentioned in Shaw's disposition to Gordon of 28th February. Shaw granted absolute warrandice from his facts and deeds only. Among the writs assigned were certified copies personal searches against Gordon and Shaw.

By letter dated 7th December 1895 addressed to Alexander Dryburgh, A. & A. S. Gordon, W.S., Edinburgh, who were the

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agents of William Shaw, and of whose firm Alexander Gordon was a member, undertook with reference to the settlement of the purchases of the shops 205 and 207 Gorgie Road, the price whereof had been received that day, to produce searches showing a clear record as at 10th December 1895, and to deliver the personal searches assigned in the disposition.

The searches exhibited by A. & A. S. Gordon as in implement of their undertaking, disclosed two inhibitions against Shaw, both recorded in the general register of inhibitions on 22nd May 1895.

Dryburgh requested Messrs Gordon to purge the record of these inhibitions, but they refused to do so, on the ground that they had implemented their obligation, and that the inhibitions being recorded after the date of the disposition by Shaw to Alexander Gordon, did not affect the subjects.

Thereafter Dryburgh raised an action against Messrs Gordon to have them ordained to exhibit and produce to the pursuer searches showing that the subjects purchased by him were free from all encum-brances

On 19th June 1896 the Lord Ordinary ( Kincairney) pronounced the following interlocutor “Finds (1) that by letter addressed by the defenders to the pursuer, dated 7th December 1895, the defenders undertook to deliver to the pursuer searches showing a clear record, in reference to the subjects conveyed by the disposition in favour of the pursuer, dated 6th and 7th December 1895; (2) that the searches furnished by the defenders disclosed the two inhibitions against William Shaw, granter of said disposition, set forth on the record; (3) that in respect of said inhibitions the said obligation contained in said letter has not been implemented; (4) that the defenders are bound to disencumber the title to the said subjects of said inhibitions: Appoints the cause to be enrolled that effect may be given to the foresaid findings.”

Note.—… “The question is, whether the obligation expressed in the letter to produce searches snowing a clear record has been implemented, or whether the two inhibitions showed that the record was not clear, and were encumbrances which the defenders were bound to remove.

On considering the case I formed an opinion in favour of the pursuer, but it appeared to me that the letter was not sufficiently stamped. That defect has been rectified, and having reconsidered the cause I retain the opinion that the pursuer is in the right, and that the defenders' obligation has not been fully implemented.

The letters of inhibition are in the form of the Schedule QQ in the Titles to Land Consolidation Act 1868, and they purport to prohibit Shaw, inter alia, from ‘disponing his lands or heritages.’ Of course the prohibition is in general terms and mentions no lands. Before 1868 letters of inhibition affected not only lands belonging to the person inhibited at the date of recording the letters, but also lands subsequently acquired by him (Stair, iv. 50, 17; Ersk. ii. 11, 10). But it is provided by the 157th section of the Act of 1868 that no inhibition shall affect acquirenda except in cases mentioned in the section.

By the disposition to the pursuer Shaw does the precise thing which the letters prohibit. Prima facie the disposition is in breach of the letters and reducible ex capite inhibitionis. Section 157 does not affect the question and need not be considered, because there is no suggestion that the subjects have been acquired by Shaw since the inhibitions were recorded. He had the same right to the lands then as at the date of the disposition.

The defenders' answer is that the inhibitions do not affect the lands, because at both dates Gordon, and not Shaw, was proprietor in virtue of the disposition to Gordon, dated 28th February, and so prior to the inhibitions recorded on 22nd May. I am, however, of opinion that it is competently ascertained that at these dates Shaw, and not Gordon, was the true proprietor. It is true that the disposition of 28th February by Shaw to Gordon is ex facie absolute. It bears to be granted ‘for certain good and onerous causes and considerations not exceeding in all the sum of £ 600.’ It does not bear expressly that any sum was paid, but yet it is ex facie absolute.

But the disposition in favour of the pursuer granted by Shaw as well as by Gordon proves, I think, incontestably that the disposition by Shaw to Gordon was only in security, and left the radical right in Shaw. The disposition to the pursuer has the effect of a registered back letter on the previous disposition by Shaw to Gordon. It bears that the price was paid to Shaw, that it was Shaw who undertook absolute warrandice, and (which appears conclusive) it expressly describes Shaw as the proprietor, and that I take to be the language of Gordon as well as of Shaw. But the defenders say that at all events the feudal title was in Gordon, and that what was left in Shaw was only a personal right to have the subjects reconveyed. That is no doubt true, and is fully borne out by the case of the Union Bank of Scotland, Limited, v. National Bank of Scotland, Limited, Dec. 10, 1886, 14 R. (H.L.) 1, quoted by the defenders. I do not doubt that Gordon could have given a good title, and I do not say whether a disposition by Gordon could have been objected to on account of letters of inhibition against Shaw. But I am not concerned with a disposition by Gordon, but with a disposition by Shaw, as principal granter, he having the radical right, but not the feudal title. The defenders quoted no authority to the effect that the operation of an inhibition depends on sasine or registration; or that an inhibition does not affect such a radical right in lands as was in the person of Shaw. It has, it is true, been doubted whether an inhibition will affect an heritable bond which has never been feudalised.—Dirleton's Doubts, p. 100, and Stewart's Answers, p. 163. But it has been decided that if a heritable bond has been feudalised and then assigned, further transferences of it will be struck at by an inhibition, although the right of the

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inhibited disponer be only personal— Low, December 6, 1814, F.C. That is to say, that an inhibition may affect an heritable right in the person of one who does not hold it by feudalised title. I do not think that I require to decide whether, assuming the radical right to be in Shaw, that right is affected by the letters of inhibition. I lean to the opinion that it is. But it is enough if the point be fairly open to serious question. I think that it is; and on that account I am of opinion that the pursuer is entitled to object that a search which discloses such inhibitions does not shew a clear record.

Further, I regard the defender's letter as corroborative of the obligation of Shaw as seller. It adds the obligation of the defenders to his; and it appears to me that the obligation of the defenders may be measured by Shaw's obligation. Now, that was the ordinary obligation of a seller to disencumber the subjects. On that point Professor Menzies observes, ‘If there are inhibitions undischarged, discharges must be insisted for, unless the party inhibited has been afterwards sequestrated; the sequestration terminates the effect of inhibition in relation to third parties, for it is under it that inhibition must be made effectual.’—Menzies' Lectures, 3rd ed., p. 830. That, it is true, was written before 1868, but, as I have remarked, the provision in the Act of 1868 does not seem to affect the case. It can hardly be doubted that before 1868 a purchaser could not be compelled to take a title from a seller under inhibition, nor to do so now, unless it appeared that the seller had acquired the lands since the date of the inhibition, and so was in a position to plead the 157th section of the Act of 1868.

On the whole, I am of opinion that, so long as the letters of inhibition are not taken out of the way, the obligation of the defenders has not been implemented.”

The defenders reclaimed, and argued—(1) An inhibition did not act retro. A search either real or personal was only brought down to the date on which the person against whom the search was made was divested of the property. If the record was clear as against that person at the date of divestiture, it was clear against him for all time. It reduced the matter to an absurdity to contend that the record required to be cleared of all inhibitions although these might be recorded long after the person against whom the search was made had been divested of the property. If therefore Shaw was divested of the property on 28th February 1895, the defenders had fulfilled their obligation to produce a search showing a clear record; if the record was clear as at the date (2) Shaw was in a legal sense divested of the property on 28th February 1895. He had not even a reversion, he was only entitled to insist in an accounting. His right was a personal one, that of a creditor. An inhibition was not effectual to secure his right—Bell's Comm. 7th ed. ii. 135. According to Stair, iv. 50, 2, inhibition was only extended to ground rights by infeftment, and this doctrine was qualified by the decision in Low v. Wedgwood, December 6, 1814, F.C., in which it was held that the right must be capable of being perfected by infeftment, and that infeftment must have followed upon it. Now, Shaw's right in the property after his disposition to Gordon was not a ground right capable of being perfected by infeftment, and no infeftment had followed upon it.

Argued for pursuers—He had got a disposition which described Shaw as the proprietor of these heritable subjects and under which the price was to be paid to Shaw. The defenders had come under an obligation to produce searches showing a clear record as at 10th December 1895. The searches produced showed two inhibitions against Shaw recorded 22nd May 1895. The record therefore would not be clear until it had been purged of these inhibitions. As long as they stood the pursuer's title would be unmarketable. The question as to whether the disposition of 28th February 1895 had divested Shaw of the property so that inhibitions were unavailing against him was a difficult question of law, and one in which the Lord Ordinary had arrived at a different opinion from the defenders. It was not for the pursuer to settle this matter, all he demanded was a marketable title and a search showing a clear record as against Shaw at 10th December 1895.