Scottish Court of Session Decisions

In November 1896 the Commissioners for the Harbour and Docks of Leith, incorporated by “The Leith Harbour and Docks Act 1875,” presented a note of suspension and interdict against the Magistrates and Council of the Burgh of Leith as such, or as coming in place of and as representing The Commissioners of Police of the Burgh of Leith, acting under the Burgh Police (Scotland) Act 1892, and as Local Authority under the Public Health Act 1867, and Acts amending or extending the same. The complainers prayed the Court “to suspend the proceedings complained of, and to interdict, prohibit, and discharge the said respondents from assessing, demanding, and levying, or proceeding to carry out a resolution by them to assess, demand, or levy, under or in virtue of the Public Health Acts, any rate or assessment on the properties of the complainers within the said burgh, or on any rental or valuation thereof, to be applied directly or indirectly in or towards payment, in whole or in part, of the expenses incurred by the respondents in or connected with opposition by them to or in connection with the bill promoted by the corporation of the city of Edinburgh, in the session of Parliament 1896, for the extension of the boundaries of said city, and the amalgamation of the burghs of Leith and Portobello therewith, or in or towards payment of money borrowed, or to borrowed by them, for the purpose of paying said expenses.”

The following epitome of the circumstances of the case and the contentions of parties is taken from the note to the interlocutor of the Lord Ordinary ( Pearson):—“In the Parliamentary Session of 1896 the Corporation of Edinburgh promoted a private bill for the extension of the boundaries of Edinburgh, which became the Edinburgh Extension Act 1896. As originally presented, it proposed to extend the boundaries of Edinburgh over Leith, Portobello, and a considerable area of the county. Various petitions were lodged by opponents of the bill; and, among others, a petition by the Provost, Magistrates, and Council of the Burgh of Leith, objecting to the inclusion of Leith, for reasons fully stated in the petition. The Committee of the House of Commons, without calling on the Leith authorities to lead evidence, sustained their objection to amalgamation, and Leith was dropped from the bill, together with a part of the county lying to the eastward of it.

There remained, so far as Leith was concerned, only certain questions as to a portion of the county territory lying to the west amounting to about 122 acres, upon part of which Leith had recently erected a fever hospital at a cost of about £50,000. Leith desired this territory to be excluded from the bill and to remain in the county, mainly on the ground that, looking to the effect of the bill otherwise, this was the natural and indeed the only direction in which Leith could extend. Mainly on this ground Leith followed the bill to the House of Lords, but unsuccessfully. There were, however, certain amendments added to safeguard the position of Leith, as regards the fever hospital and the sewer connected with it.

The parliamentary opposition cost the Magistrates and Council of Leith about £3500, by far the larger part of which was the cost of the proceedings in the Commons. They have now, acting as the Public Health Local Authority, resolved to pay the whole of this sum out of the Public Health Assessment, in equal instalments over a period of five years; and they have added to their Public Health Estimate for the year current when this note was presented, a sum of £700 in pursuance of that resolution.

The Leith Harbour and Dock Commissioners now seek to have the Corporation interdicted from carrying out that resolution. The Commissioners are statutory owners of the harbour and docks of Leith, as well as some small proper ties outside the harbour and docks; and their valuation amounts to a sixth or a seventh of the entire valuation of the burgh. They stand in this peculiar position, that while they are liable to be assessed on the harbour and docks for public health purposes, they are by statute exempt from—the Burgh

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General Assessment, and also from assessment under the Roads and Bridges Act. The Burgh General Assessment falls on occupiers only; the Public Health Assessment on owners and occupiers in equal proportions.

The respondents say that they levy assessments under these and various other statutory powers, and that in the exercise of their discretion as trustees for the administration of those statutes, they have elected that the costs in question should be borne by the assessments levied under the Public Health Acts. Their reasons for doing so they explain to be (1) that the bulk of the case for the City of Edinburgh was rested on public health grounds; and (2) that the assessment being leviable equally from owners and occupiers, the burden would be distributed equitably on the ratepayers of the burgh.

The objection stated by the complainers is that this course of procedure is ultra vires. They rest this on two grounds—(1) On the provisions of the Municipal Corporations (Borough Funds) Act 1872 (35 and 36 Vict. cap. 91); and (2) on the general law.”

On 16th July 1897 the Lord Ordinary pronounced the following interlocutor:— “Suspends the proceedings complained of, and interdicts, prohibits, and discharges the respondents from imposing and levying, and from proceeding to carry out a resolution to impose and levy, on the complainers in respect of their properties within the Burgh of Leith, any rate or assessment as under the Public Health Acts, in so far as the same is to be applied directly or indirectly in payment of the expenses incurred by the respondents as mentioned in the prayer of the note; or in payment of the one-fifth thereof effeiring to the year ending Whitsunday 1897; or in payment of money borrowed or to be borrowed by them for the purpose of paying said expenses, and decerns.”

Note.—[ After statement of circumstances as above]—“First, as regards the Borough Funds Act. So far as appears, that has never been made use of in Scotland since it was passed, and no procedure was taken under it in the present case. The complainers maintain that it applies to Scotland, and that it prescribes an exclusive code of procedure under which alone municipal bodies in Scotland, since the passing of that Act, can apply their funds in defraying parliamentary costs. If the Act applies, the mode of obtaining the consent of the ratepayers in the district is prescribed by reference to the English Local Government Act 1858. Now, the first question is whether the Act of 1872 applies to Scotland. I have said that it has never, so far as known, been acted upon in this country, although the reasons for it apply as much in Scotland as in England. But it is a general rule in the interpretation of statutes that they apply to the United Kingdom, unless their scope is limited by express terms or by necessary implication. Now, the language of this statute is certainly most inappropriate for use in Scotland. The statutes to which it refers are entirely English, and it prescribes a procedure which is purely English, and which was introduced by an English public general Act. But there is one clause in it which shows that the mind of the Legislature was directed to the question of the extent of its application. The eleventh section says expressly that ‘this Act shall not extend to Ireland.’ Such an exception is not conclusive as to the Act extending to Scotland, because it might be that an Act plainly applicable in its language only to England and Ireland might not be held to apply to Scotland by a mere exclusion of Ireland. Here I see no impossibility in working out the Act in Scotland, and as the reason for it applies wherever municipal bodies exist, it seems to me that the fact that Ireland is expressly excluded affords an argument of some weight to show that Scotland is within the Act.

A leaning in favour of this view was indicated by the judges in the case of the Perth Water Commissioners, and on the whole I am disposed to adopt it.

The next question is, whether the statutory procedure is exclusive, or whether parliamentary expenditure can still be justified on grounds which would have been sufficient if the statute had not passed. Now, the statute has a saving clause, section 8, which says that nothing in the Act shall take away or diminish any right or power possessed or enjoyed by any governing body. The question whether this will suffice for the respondents is a somewhat narrow one. But, on the whole, I am prepared to adopt the conclusion arrived at by the late Master of the Rolls in the Brecon case, L.R. 10 Chancery Division, 204, and to hold that the statute, while it applies to Scotland, does in its saving clause keep alive the existing powers and rights of municipal bodies in this particular.

I must therefore consider what is the respondents' position apart from that statute. Are they entitled to pay these parliamentary costs out of funds in their hands, and in particular out of the public health assessment? Now, these are two different questions, and I shall deal with them in their order.

The general question whether a municipal corporation is entitled to defray parliamentary expenses out of the public moneys has often been canvassed, and the rule which has been adopted (subject to certain qualifications) is that the costs will be allowed if they were incurred in the course of a reasonable administration of the trust. If they were not so incurred they cannot charge them at all. I presume that even the ‘common good’ would not be liable to a charge of this nature unless the authority were prepared to show and did show that the act was one of reasonable administration. But if they show that, then I think in the general case, and apart from questions which may arise as to burdening a particular assessment with it, the rule is as I have stated.

Now, in this connection there are several tests of the reasonableness of the administration

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which has led to the expenditure. It is a favourable circumstance to begin with, that it was incurred in opposing and not promoting a bill. Then the success or failure of the parliamentary action taken is an important consideration; and here the opposition of Leith was to a very large extent successful. Further, one must have regard to the nature of the proposals which are resisted, and here there is much to be said for the view that the respondents were defending not merely their corporate existence but the separate existence of the burgh of Leith as such. It would not be sufficient if they had merely defended their personal dignity or their personal administration, nor even (in the narrower sense) their own existence as trustees; because, as has been said, a trustee, unlike an individual, has no vested interest in his own existence. But the proposals of Edinburgh went much further. Whatever word may be used as describing the effect of these proposals on Leith, there can be little doubt that the union which was contemplated would have meant in several important particulars the absorption of Leith by Edinburgh. The basis of the whole Act was the extension of the boundaries of Edinburgh, and although the old names would doubtless have been continued for convenience, Leith would (from the municipal point of view) have counted as so many wards of Edinburgh. Then again the attitude of the community is not unimportant, and in the present case I am informed that, except one gentleman, there are no ratepayers taking any objection other than the present complainers, and that is the more significant because in the second part of the case, which I shall deal with separately, the interest of the complainers is diametrically opposed to the interests of the general ratepayer.

I do not think that the conclusion at which I arrive on this part of the case runs counter to any of the authorities which were quoted.

This is a case of successful opposition to parliamentary procedure, and that is the strongest case for acknowledging the right to charge the costs upon public funds. And although this will not always be allowed, the cases where it has been refused have proceeded on the construction of statutory words, which have been held to exclude the power, as in the case of the Mayor of Sheffield, Law Rep. 6 Q.B. 652.

But it does not follow that the Town Council, as the Local Authority under the Public Health Act, are entitled to defray this expenditure wholly out of the Public Health Assessment, which is what they have resolved to do; and indeed they have already debited the whole against the Public Health Account, though they spread the charge over five years. That seems to me a very different question, not depending on the same considerations as the other, and a question of really much narrower scope, It does not lie on the complainers to point out what other sources of payment may be available to Leith if this source is closed to them. It may be that the common good would be available; and that would extinguish the amount in about seven years instead of five. It may be that the expenses could be allocated over other funds. But the only proposal which the complainers have to resist is the proposal made to defray all out of the Public Health Assessment. I note that at this part of the case the complainers part company with the general body of ratepayers, whose interest it is, if the charge is to be allowed at all, to have it laid on over the largest possible area. Still the complainers have obviously a title and interest to raise this question; and they plead that when a body of persons in the respondents' position seek to lay a charge of this kind on a statutory assessment, they must show that it is within their statutory powers.

I may observe that at this point the argument that was urged for the respondents upon the prior part of the case will not serve them, namely, the argument that they were defending their trust. For if they had been absorbed into Edinburgh, or amalgamated with it, their existence would have been brought to an end in a great many more capacities than as public health authorities. And therefore though that argument might warrant them, if it were otherwise legal to do so, in laying the costs proportionally on the various rates in their hands, it would not entitle them to lay them all on the Public Health rate. Nor do I think it avails the respondents on this point to say that the public health administration was affected by the parliamentary proposals. Their public health administration in the past was certainly criticised, and one may say attacked. No doubt that might bear upon the prosperity of Leith regarded as a residential town, and in that sense they were, as guardians of the interests of Leith, entitled to vindicate its amenity. But, in the main, that was a personal matter, which affected only the administrators themselves, who were alleged to have been lax in their duty. Even the contention that this rate has been selected by the Magistrates because it operates more fairly than any other which they might have chosen, will not carry the respondents very far. On that point they say, in the first place, that it brings in the owner instead of leaving the occupier to pay it, as would have been the case if they had laid it on the Burgh General Assessment. Now, where there is difference of incidence between two assessments, I must assume the difference is founded on good reasons; but these reasons do not touch the question whether it is more fair that the one assessment or the other should pay for these parliamentary costs. The one thing has no connection with the other. Nor is it very important to my mind that this enables them to bring in the Harbour Commissioners, who would otherwise pay no part of the expenses. These subsidiary reasons seem to me rather to weaken the respondents' case on the question under the statute; for if they are right under the statute, they require no such collateral reasons for their action. The assessment

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in question has been imposed by the magistrates as the Public Health Local Authority, and therefore I assume they imposed it on the footing that the expenses which it is to meet were expenses incurred by them as such Local Authority.

Now, to begin with, I entertain considerable doubt as to whether it is made out that any of the expenses were in fact incurred by them as Local Authority under the Public Health Acts; and I cannot see how it can be successfully contended that all of them were so incurred. In the first place, the petitions to both Houses of Parliament were not in their names as Local Authority, but as the Provost, Magistrates, and Town Council of Leith. In that capacity, or as Police Commissioners, they are no doubt the Local Authority under the Public Health Act, but they have distinct powers as Local Authority, and the mere mention in the petitions of the fact that they hold that separate position does not seem to me to make out that the petitions were presented by them in the capacity of administrators of Public Health. But further, the bill as introduced and as passed does not seem to affect Public Health administration, either in the sense or altering the general law or of diminishing the power of the Local Authority here over their district. What it proposed was to enlarge the body which should administer the same set of public statutes. Possibly it made the duties of individual members of that body more onerous; but it was not shown by Leith that any of the proposals of Edinburgh would tend to impair the efficiency of the Leith Public Health administration, or would even increase the Leith Public Health rate. The bill did not interfere with the Leith Public Health administration in the sense in which a bill might have interfered with it had it affected sewers or any other part of the Public Health equipment. I think that the statements of the respondents on record show that the bill aimed mainly at amalgamation, and that in challenging Edinburgh on the Public Health question, which is said to have bulked largely in the evidence, they did so by way of reply to the case made by Edinburgh, to the effect that it was one of the reasons for amalgamation that the Leith administration of Public Health had been lax in the past. That no doubt put the Leith administrators on their defence in that particular; but that is quite a different thing from saying that the expenses were incurred by them as Public Health Authority.

But even assuming there was less of this personal element than I think there was, I am not satisfied that these expenses were in any sense incurred under the powers of the Public Health Act. I read the powers in these Acts fairly and even liberally in a question of this sort; and I find that by section 95, which I think was the only section founded on, the charges and expenses ‘incurred by the Local Authority in executing this Act’ may be defrayed out of the assessment called the Public Health Assessment. Were these Parliamentary costs incurred by the Local Authority in the execution of the Public Health Act? I must say I cannot hold that they were; and on that second and narrower ground I must negative the contention that they are entitled to lay the whole of them upon the Public Health Assessment, either all at once or by instalments, which, as I understand, is the only resolution at which they have arrived.

In the view I take it is unnecessary to deal separately with the House of Lords expenses. I have been speaking of the main expenses of the opposition, but undoubtedly in another aspect of the case the expenses incurred in relation to the House of Lords discussion would deserve to be considered separately. By that time Leith had dropped out of the bill; it was not to be amalgamated; that was settled and done with. It is plain that in the House of Lords the main question was whether the 122 acres lying to the west, including Pilton Hospital, should not be left in the county, in order that Leith might have an opportunity of expanding in that direction; and on that question Leith was unsuccessful. But, as I have said, in the view I take it is not necessary to draw the line between expenses in the House of Lords and in the House of Commons. It follows from what I have said that I must grant interdict, but I should like parties, and especially the complainers, to explain their view as to the proper interdict to be granted in the circumstances, having regard to the prayer of the note.”

The respondents reclaimed, and argued— They were entitled to pay the expense of the opposition out of the Public Health Assessments. Their existence as a Local Authority under the Public Health Acts was threatened by the bill. A public body were not entitled to expend the rates under their charge in promoting a bill to extend their jurisdiction— Perth Water Commissioners v. M'Donald, June 17, 1879, 6R. 1050, or in watching and opposing general legislation— Wakefield v. Commissioners of Supply of Renfrew, November 25, 1878, 6 R. 259, but they were entitled, like any other body of trustees, to defend an attack in Parliament against their existence, and rights, and powers, and to defray the expense incurred by them out of the rates under their charge—opinion of Lord Justice-Clerk Moncreiff in Perth Case, supra, 6R. 1050; Brighton v. North (1847), 16 L.J., Ch. 255; Attorney-General v. Mayor of Wigan (1854), 23 L. J., Ch. 429; Attorney-General v. Mayor of Brecon (1878), L.R., 10 C.D. 204. The fact that the opposition to the bill was successful showed that the defence of the Magistrates was reasonable. If the Court were of opinion that they were entitled to take a part of the expense out of the Public Health Assessment, it must be left to the discretion of the Magistrates to determine what proportion should be taken out of that fund, because if the discretion of the Magistrates was interfered with, the administration of their functions would become unworkable. The Magistrates

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were of opinion that the whole expenses should be paid out of Public Health Assessment, because (1) the bulk of the expense of opposing the bill had been incurred on public health grounds. The opposition might therefore be said to be in execution of the purposes of the Act— Opinion of Jessel, M.R., in Brecon Case, supra, L.R., 10 Ch. D. 215. (2) It was the most equitable course, as the Public Health Assessment was paid by both owners and occupiers, while the Burgh General Assessment was only paid by occupiers. It was said that the expenses could be paid out of the burgh funds, but their funds were insufficient for the purpose, and if the Court held that the Magistrates were not entitled to pay the expenses out of the burgh assessments, the result would be that the Council would be unable to resist Edinburgh's next attack on Leith. The Borough Funds Act 1872 did not affect this case, because (1) the Act did not apply to Scotland, as the phraseology was English and the machinery appropriate to England, and (2), even if the Act did apply to Scotland, the saving clause, sec. 8, exempted a case like the present.

Argued for complainers—The question to be decided was, whether it is competent for the Magistrates to charge on the Public Health rate the whole expense of a contest on the subject of the amalgamation of Leith with Edinburgh. The opposition of the Council of Leith to the bill did not rest on the ground of public health at all, but consisted of (1) an attempt to resist amalgamation, and (2) an attempt to obtain a larger territory for Leith. If Edinburgh had succeeded in its attempt to incorporate Leith, the public health of Leith would not have suffered in the slightest degree. The body of trustees would in that case have been enlarged, but the purposes and administration of the trust would have been left untouched. If the passing of the bill had necessitated the Water of Leith being turned into a sewer, the Magistrates, on the authority of the Wigan case, supra, might have justified their attempt to charge the expense of their opposition on the Public Health Assessment. But the passing of the bill would have no injurious effect on the public health(of Leith, and therefore the expense of opposition to such a bill could not be considered expenses incurred by the Local Authority “in executing this Act” in terms of section 95 of the Public Health Act 1867. In the Brecon case, founded on by the respondents, the burgh funds were alone dealt with. The burgh funds in English boroughs were equivalent to the “common good” in Scottish burghs, and it might be that the Magistrates were entitled to defray the expense of their opposition out of the common good. But no case had been cited to support the view that magistrates were entitled to take the expense incurred in opposing a bill like that in question out of the burgh assessments, and the authorities were all the other way— Perth Water Commissioners, supra; Wakefield, supra; The Queen v. Mayor of Sheffield (1871), L.R., 6 Q.B. 652. Further, the Magistrates of Leith had taken no steps to ascertain if the ratepayers approved of their action, in terms of the Boroughs Fund Act 1872. That Act applied to Scotland, because (1) although the phraseology used was English there was no difficulty in interpreting it in accordance with Scottish law, and (2) Ireland was expressly excluded, and there was therefore a presumption that all the other parts of the United Kingdom were included. Section 8 of the Act must be read along with the context, and did not exclude the application of the Act to this case. In any view, the interlocutor of the Lord Ordinary should be affirmed.

At advising—