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Scottish Court of Session Decisions
You are here: BAILII >> Databases >> Scottish Court of Session Decisions >> Ferguson, Davidson, & Co. and Another v. Paterson, Dobbie, and Others [1898] ScotLR 36_153 (6 December 1898)
URL: http://www.bailii.org/scot/cases/ScotCS/1898/36SLR0153.html
Cite as: [1898] SLR 36_153, [1898] ScotLR 36_153
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SCOTTISH_SLR_Court_of_Session
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Court of Session Inner House First Division.
[
v.
Agent and Client
Title to Sue — Dominus Litis — Title to Sue of Party Sisted of Consent as Dominus Litis.
Facts:
An action was raised in the name of an unsecured creditor in a sequestration by a third party who had the real interest in the action, to reduce a sale of the bankrupt's heritage by the trustee. The trustee and the purchaser, who were called as defenders, averred that the action had not been authorised by the nominal pursuer; and in reply to this averment the dominus litis produced a mandate from the nominal pursuer authorising the former to act for the latter in the sequestration.
Held (foll. Glen v. Glen, Nov. 17, 1826, 5 S. 10) that the mandate produced was insufficient to authorise the institution of the action.
Where in course of ordinary procedure the authority of counsel and agent for a party to act for him is seriously disputed, time should be given to permit the production of a mandate.
The Court having allowed a mandate to pursue an action to be produced within eight days, where the mandate of the pursuer's counsel and agent was seriously challenged, and no such mandate having been produced, the action dismissed.
Opinion of Lord Young in Fischer & Company v. Anderson, January 15, 1896, 28 R. 395, approved of.
An action was raised in the name of a creditor upon a sequestrated estate to reduce a sale of the bankrupt's heritage by the trustee, and to this action the trustee and the purchaser were called as defenders. It was admitted that the proceedings had in fact been instituted by a former agent of the trustee who had procured from the nominal pursuer an obligation to execute an assignation of the pursuer's claim in the sequestration in his favour. No such assignation had in fact been executed, and the nominal pursuer, while admitting on record that the said agent was dominus litis, denied that lie was a competent pursuer. The said agent was in the Outer House sisted as a party to the action quâ dominus litis.
The nominal pursuer having disclaimed the action, held that it could not proceed at the instance of the dominus litis alone, the obligation to grant him an assignation affording him no title to sue, and the pursuer's record expressly denying that he was a competent pursuer in the action.
The estates of William Deans, builder, Edinburgh were sequestrated in 1882, and Mr Hugh Miller, C.A., was appointed trustee thereon by the Sheriff on November 6th of that year. The bankrupt's estate consisted principally of house property, estimated to be worth £4000, but burdened with an heritable debt of £2800. His moveable property amounted to about £500. The heritable property was exposed for sale at the price of £3200 in 1884, but was not sold. It was again exposed for sale in March 1890 at £2700, and was then knocked down to Mr Joseph Dobbie for £2735. Mr Miller died on 15th July 1890, and was succeeded in the office of trustee in the sequestration by Mr James Paterson, C.A., conform to act and warrant of the Sheriff dated 27th August 1890. Mr Paterson was also judicial factor on Mr Miller's estate.
In these circumstances an action was raised by Messrs Ferguson, Davidson, & Company, and Patrick Knox, plumber (unsecured
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creditors on Deans' estate for £1810 and £125 respectively), against Mr Paterson, Mr Dobbie, and certain other persons, commissioners or pretended commissioners on the sequestrated estate, to reduce the disposition of the heritable subjects executed by Paterson in Dobbie's favour, and certain other writs, including a minute by the Accountant of Court dated 10th March 1896, concurring in the sale of the subjects to Dobbie for £2735. The grounds on which the pursuers sought to reduce the sale were (1) that the property had been sold by the trustee at a price under the amount of the bond, fixed by himself, and without the concurrence of the commissioners in the sequestration; (2) that a minute bearing that the sale to Mr Dobbie had been approved of at a meeting of a majority in number and value of the creditors was incorrect, unwarranted, and false; and (3) that the Accountant of Court was induced to give his consent to the sale by a certificate granted by Paterson that those who had signed the said pretended minute were a majority in number and value of the whole creditors.
The defenders Paterson and Dobbie denied “that the nominal pursuers, Ferguson, & Company, are now creditors on the said estates. By missives dated 11th and 12th August 1897, the said pursuers, in consideration of the sum of £5 paid to them by Mr R. Ainslie Brown, S.S.C., the agent who acted for the former trustee in the sequestration … and an obligation by him to hand over any surplus in the event of his recovering more than £5, assigned to the said R. Ainslie Brown their claim in the sequestration. By said missives it was further agreed that said pursuers were to be relieved by Mr Brown of all responsibility and expenses in connection with his investigation into the matter, and that they were to grant a formal assignation when required.… The true dominus litis is the said Robert Ainslie Brown, and he should be ordained to sist himself as pursuer.”
It was admitted on record by the pursuer in answer to this averment that Mr Brown, “who as formerly law-agent in the sequestration has substantial claims in the sequestration of the said William Deans, but is not himself a competent pursuer, is dominus litis in the present action.”
The defenders pleaded, inter alia—“(3) The action not having been authorised by the nominal pursuers, and separatim, having been disclaimed by them, falls to be dismissed. (4) Robert Ainslie Brown, mentioned in the defences, being the true dominus litis in the present proceeding, ought to be ordained to sist himself as party pursuer.”
The writings founded on by the defenders were the following:—
“Letter, Ferguson, Davidson, & Co. to Mr Brown. “11 th August 1897.
“Dear Sir,— Wm, Deans' Seqn.—We are in receipt of your favour of to-day's date. We are agreeable to assign to you our debt on this estate on the conditions mentioned by you, viz., (1) Cash payment of the sum of five pounds (£5). (2) In the event of your receiving more than £5, after deduction of expenses, such overplus to be handed over to us. 3. We are to be relieved of all responsibility and expense in connection with your investigations into this matter. If you will send us your cheque for £5 and an assignation duly prepared, we shall return the latter with our signature.—Yours faithfully,
“ Ferguson, Davidson, & Co.
Geo Muat.”
“Letter, Mr Brown to Ferguson, Davidson, & Co. 12 th August 1897.
Dear Sir,— Wm. Dean's Seqn.—I am in receipt of your favour of yesterday agreeing to me your claim in this sequestration in consideration of the sum of £5, for which I enclose my cheque. The bargain is under the second and third conditions stated in your letter, to which I agree. I do not think a formal assignation will be necessary meantime, but I will be content with the letter and mandate enclosed, which I shall thank you to subscribe and return to me.—Yours faithfully,
“ R. Ainslie Brown.”
“ Letter of Acknowledgment, Ferguson. Davidson, & Co. to R. Ainslie Brown.
Edinburgh, 12 th Augt. 1897.
Dear Sir,— Wm. Deans Seqn.—We acknowledge to have received from you the sum of five pounds stg. in consideration of our assigning to you our claim in the sequestration of William Deans, builder, Hope Crescent, Edinburgh, and we undertake, when called upon by you, to grant a formal assignation in favour of yourself or your nominee of said claim, but always under the second and third conditions stated in our letter to you of 11th inst. In the meantime we send mandate for us in the sequestration.—Yours faithfully,
“Ferguson, Davidson, &Co.,
[Stamped] 12/8/97.”
“ Mandate by Ferguson, Davidson, &Co. in favour of R. Ainslie Brown.
“ Edinburgh, 12 th Augt. 1897.
Sir,—We, Messrs Ferguson, Davidson, & Co., timber merchants, Edinburgh and Leith, creditors on the sequestrated estates of William Deans, builder, Hope Crescent, Edinburgh, for the sum of £1810, 4s. lid., conform to oath with account annexed lodged by us in the sequestration, and admitted by the late Hugh Miller, C.A., as trustee thereon, hereby nominate and appoint you to be mandatory in the sequestration, and to attend at all meetings of creditors therein, and to act and vote, and take all action in our names you may deem necessary, and with all powers competent to us, and we revoke all former mandates granted by us in connection with the sequestration.—We are, Sir, your obedt. Servants,
“ Ferguson, Davidson, & Co.
R. Ainslie Brown, Esq., S.S.C.”
The following letter passed between the agents of Ferguson, Davidson, & Co. and those of Dobbie:—
“Dear Sirs,— Deans' Seqn.—We are favoured with your letter of yesterday's date. Our clients Messrs Ferguson, Davidson, & Co. agreed to sell their claim in the above sequestration to Mr Ainslie Brown for the sum of £5. On his paying that sum they granted an undertaking to execute an
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assignation, and at the same time granted to him the mandate dated 12th August 1897 founded on in the proceedings. Beyond this they have done nothing in the matter, and have not given authority for the institution of the proceedings in their name. In fact they were not aware of the nature of these proceedings until some time after they had been instituted. They never authorised Messrs Welsh & Forbes to act for them in the matter, and they disclaim all responsibility in the proceedings.—Yours faithfully, “ Davidson & Syme.” On 7th April 1898 the Lord Ordinary (
Pearson ) pronounced the following interlocutor:—“In respect it is admitted that Robert Ainslie Brown, S.S.C., Edinburgh, is the true dominus litis, appoint intimation of the action and of this interlocutor to be made to the said Robert Ainslie Brown that he may sist himself as pursuer if so advised.”On 14th May the Lord Ordinary, in terms of a minute lodged by Mr Brown, sisted him as pursuer qua dominus litis.
On 19th July the Lord Ordinary allowed parties a proof their averments on record, and to the pursuers a conjunct probation.
The defender Dobbie reclaimed.
On 28th October 1898 the pursuer Knox lodged a minute disclaiming the action, which minute the Court of the same date sustained.
Argued for the defenders—No authority was given by the nominal pursuers to raise this action. The mandates produced were not proper warrants for an action of reduction. The prevailing note of the decisions was that the mere appearance of counsel was not evidence of mandate which could not be rebutted. It was only prima facie evidence until challenged. In the case of Thomson v. Incorporation of Candle-makers, May 25, 1855, 17 D. 774, the denial of authority came only when everything was over. But even assuming that that was authority against the defenders' contention, Lord Young had expressed the contrary view in the recent case of Fischer & Co. v. Andersen, January 15, 1896, 23 R. 395, 399. See also Cowan v. Farnie, March 4, 1836, 14 S. 634, per Lord Mackenzie, 645. Granting that this mandate went as far as an ordinary mandate, the raising of an action of reduction was not within its scope — Glen v. Glen, November 17, 1826, 5 S. 10. In Fraser v. Duguid, June 19, 1838, 16 S. 1130, there was an assignation ad hoc. Brown had purchased the pursuers' right, but he was not entitled to augment the value of his purchase by attempting to cut down proceedings prior to the assignation— Symington v. Campbell, January 30, 1894, 21 R. 434. Messrs Ferguson, Davidson, & Company had assigned their claim and had lost their right of action. Brown had the claim assigned to him but not the right of action.— Levett v. London and North-Western Railway Company, July 17, 1866, 2 S.L.R. 207. Strictly speaking, he held no formal assignation, but merely an obligation to grant one. It was not enough to entitle him to pursue the action that he was supplying the funds. He must have full control of the action.— Corson v. M'Lauchlan, February 8, 1828, 6 S. 505.
Argued for Mr Brown—(1) The presence of counsel in this Court implied a mandate until the party had disclaimed. While the opposite party might do what he pleased or could in the way of urging the alleged client to disclaim, he had no right to call upon the advocate to produce his mandate, and could not ask a proof of whether he had such a mandate. Those propositions were well established by authority .—Ballantyne v. Edgar (1676), M.348; Earl of Marchmont v. Home (1715), M. 358; Hamilton v. Marshall, November 25, 1813, F.C.; Wallace v. Miller, May 31, 1821, 1 S. 43; Thomson, ut sup.; Stair, i. 12, 12; Ersk. Inst. iii. 3, 33; Shand's Practice, pp. 79, 154, 313; Mackay's Manual, p. 286. Ferguson, Davidson, & Company had known of the action here, and not having disclaimed must be held to have authorised it.— Reynolds v. Howell, L.R., 8 Q.B. 398, per Bramwell, J., 400. (2) Apart from the question of mandate, Mr Brown, as assignee, was entitled to pursue the action on his own account. Though originally his interest in the action depended upon the expenses due to him, he was now here as pursuer in virtue of the assignation granted to him.— Sanderson v. Campbell, May 17, 1833, 11 S. 623; Pitcairn v. Pitcairn's Trustees, June 21, 1834; Fraser, ut sup.; Fraser v. Dunbar, June 6, 1839, 1 D. 882; Barclay v. Glendronach Distillery Company, October 21, 1868, 7 Macph. 9.
At advising on November 25th—
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The question on which the petitioners requested the guidance of the Court was the following:—“Which congregations ought the petitioners to recognise as eligible to participate in the benefits of the Ferguson Bequest Fund provided to the Congregational Union or Independent Church of Scotland?”
Answers were lodged for the Congregational Union of Scotland, comprising the Evangelical Union and Congregational Union as existing at 1896. These respondents submitted “alternatively, that the congregations or churches now composing the Congregational Union, or at all events those of them who originally belonged to the Congregational Union, are now entitled to the benefits and privileges provided by the Ferguson Bequest to the Congregational or Independent Church in Scotland—(1) adhering in all respects to the principles and practice of the Congregational Union as existing prior to 1897 and its constituent congregation or churches; and (2) as the majority of that union or body of churches, and as representing that majority?”
Answers were also lodged by Messrs Henderson and Glaisher for the Congregational Union of Scotland, being the minority above referred to. They averred as follows:—“The churches of the Congregational order which have amalgamated with the Evangelical Union have lost the distinctive quality of the Independent churches. They have not only united themselves with churches professing a creed, which, besides, is at variance with the religious belief of many Congregationalists, but they have themselves adopted as a basis of union with these churches a form of creed which is set forth in the constitution of the new body. This act of the amalgamating majority of the Congregational Union is in derogation of the principles which have always characterised the Congregational and Independent Churches, and is essentially an abandonment of the Congregational position, and further it was carried through in breach of the written constitution regulating the admission of congregations to the Union. The constitution of the new body, moreover, differs essentially from that of the Congregational Union as it existed prior to 1896, and the churches which amalgamated have lost all title to be considered as the ‘Congregational or Independent Church’ in the sense of Mr Ferguson's settlement.” They accordingly submit that “none of the churches of the new Union is entitled for the future to participate in the funds of the trust.”
From the proof it appeared that the Congregationalists had no formal creed, and exacted no subscription to any such document. The Evangelical Union, on the other hand, was an offshoot to the United Secession Church, and its distinguishing note was adherence to Arminian, as opposed to Calvinistic views of the Atonement.
It further appeared that the following prefatory note was prefixed to the constitution of “The Congregational Union of Scotland, comprising the Evangelical Union and the Congregational Union as existing at 1896”—“While the Churches now proposing to enter into union do not require
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Argued for the Congregational Union—All the Churches allied with the Union were objects of the testator's bounty. The Union of 1896 had made no difference. Churches formerly connected with the Evangelical Union were now equally eligible with churches formerly connected with the old Congregational Union. What the trustees had to deal with was individual churches. The Congregational Union qua union had no claim upon the trustees. Adherence to Congregational principles was what qualified a particular church for participation in the benefits of the trust. The churches formerly in connection with the Evangelical Union now possessed that qualification.
Argued for the minority—Only the minority were now entitled to participate in Mr Ferguson's bounty. The majority, by uniting with the Evangelical Union, had abandoned Congregational principles. Congregationalism imposed no creed, but alliance with the Evangelical Union meant adherence to Arminian views on the doctrine of election. The new Union could not be identified with the body which Mr Ferguson had singled out for his favour. He was well aware of the existence of the Evangelical Union, but he had not preferred them in his will.— Craigie v. Marshall, January 25,1850, 12 D. 523; Couper v. Burn, December 2, 1859, 22 D. 120, referred to.
At advising—
Now, it is quite clear on the facts that the words “the Congregational or Independent Church” is an inaccurate expression, for the theory of Congregationalism and of independency precludes the idea of those congregations being organically united so as to form a Church, and there never has in fact been any association of congregations calling itself “The Congregational or Independent Church.” On the other hand, it is equally clear that what Mr Ferguson meant by these words was the denomination generally called in Scotland Congregationalist and less frequently Independent. That was in 1856 a perfectly well-known and definite denomination. Their congregations, although each an autonomous and self-contained ecclesiastical community, were associated by a very loose federal tie into what was called the Congregational Union.
Now, in 1856 there also existed in Scotland another religious denomination called the Evangelical Union. It had been formed in 1843. Historically it was an off-shoot from one of the Presbyterian bodies, and the cause of the secession of Dr Morison, and the raison d'être of the Evangelical Union was not a question of ecclesiastical polity but of religious doctrine. The new denomination was Congregationalist in practice, but its characteristic was not Congregationalism but its attachment to a theory of the Atonement which in 1856 was at variance with the doctrine predominant in all the five Churches named for favour in Mr Ferguson's will. What is more important, however, is that in 1856 the Evangelical Union was a well-known and considerable
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In these circumstances perhaps the most logical procedure is to consider, first, whether before the recent alliance between the Congregational Union and the Evangelical Union, the congregations of the Evangelical Union were eligible for the benefits of the Ferguson Bequest. In my opinion this question admits of but one answer—they were not. I hold that the words “the Congregational or Independent Church” were used to denote one definite denomination, to wit, the Congregationalists, who had been for upwards of forty years still further marked out and identified by their association with a union. The fact that the body founded by Dr Morison and called the Evangelical Union consisted of congregations who, like the Congregationalists, were bound together, not by allegiance to a common superior ecclesiastical jurisdiction but by a mere tie of alliance, was, in my opinion, a mere circumstance or point of resemblance, not affecting the question of identity. I hold, therefore, that the Evangelical Union was intentionally excluded by Mr Ferguson, not, of course, in the sense of an invidious exclusion, but that knowing of them he did not include them, just as was the case with other and older communions.
The next question is, does the recent union now entitle the congregations which up to that time had formed the Evangelical Union to share in the bequest, or, in other words, has it now brought into the favoured class those who previously had stood outside? The argument in favour of this extension is necessarily rested on the new relation of the Evangelical Union congregations to what Mr Ferguson called the Congregational Church, and what (for shortness and also for accuracy) I shall call the Congregationalists. Now, it is quite true that the words which we have to construe are “congregations belonging to or connected with the Congregational or Independent Church,” and the words “connected with ” afford the basis of the argument for inclusion. There are, however, what seem to me as conclusive reasons against this view. In the first place, the new tie is a very slender one, and it has made no difference at all in the identity of the congregations joining it. The alliance is for limited purposes, involving no surrender of or alteration in the powers formerly held or the principles professed by each of the allies. We heard a great deal of comment on the preamble of the agreement to form the new union, and I am not surprised to learn that high authorities entertain conflicting views as to which of the two parties attained the larger share of diplomatic success in the adjustment of the phrases used. But the more material point to remember is that neither party was doing anything more than arranging a basis of common action in the very limited sphere assigned to the union as such. Apart from this, the congregations each stood exactly where they did before.
The next point to observe is that this is not the case of a gradual absorption by the Congregationalists of the other community. If that had been the case—if historically and bona fide the congregations of the Evangelical Union had one by one, and from time to time, gone over to the Congregational Union, each acceding congregation would have substantially changed its ecclesiastical position, and each would in turn have come to be “connected with” the Congregational body designated by Mr Ferguson. What has taken place, however, is entirely different. The Evangelical Union has met the Congregational Union on equal terms, and has joined it on equal terms, and the title of the amalgamated Union, comprising the Evangelical Union and Congregational Union, “as existing at 1896,” attests this result, and the continued identity of each of the two allies as distinguished from their fusion.
The conclusion which I draw from these facts is that nothing has occurred to change the identity of either of those two bodies, and it will be observed that the same reasoning which excludes the congregations of the Evangelical Union establishes the continuance of the right of the congregations formerly belonging to the old Congregational Union notwithstanding their accession to the new Union. Accordingly, I hold that while the congregations which before 1896 were admitted to Mr Ferguson's bounty, to wit, the Congregationalists, have not lost their rights under his will; on the other hand, the congregations which before 1896 were not admitted to that bounty, to wit, those of the Evangelical Union, have not gained a right to admission, and remain inadmissible.
The next question is a very easy one. Certain of the Congregational congregations refused to join the new Union, and although bereft of the alliance of the majority of their brethren they keep up the old Congregational Union. I can see no reason whatever for holding that, by staying where they were, those congregations have lost their rights under the Ferguson Bequest. The argument against them rests on an exaggerated estimate of the importance of the federal relation constituted by the Congregational Union. I do not think that Mr Ferguson, when he said Congregational or Independent “Church,” meant Congregational Union, or that the existence or continuance of that institution is of any materiality except as an aid to identification. But here the identification is complete.
There remains what at first sight is rather a puzzle, and that is the case of the new congregations formed since the new union. The reasoning upon which the previous part of this opinion is based leads me to hold that they are eligible to be considered by the Ferguson trustees. They are, to use Mr Ferguson's words, “connected with” the Congregationalists, and they are not more closely connected with the congregations of the Evangelical Union. The reason why I hold that the connection with the Congregationalists does not avail the congregation
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In my opinion the proper answer to the question on which our direction is asked is, Find that the congregations which the petitioners are entitled to recognise as eligible to participate in the benefits of the Ferguson Bequest provided to “the Congregational or Independent Church in Scotland,” are the congregations which prior to 1890 belonged to the Congregational Union of Scotland, irrespective of whether they have not joined the new Union called “The Congregational Union of Scotland, comprising the Evangelical Union and Congregational Union as existing at 1896,” and also the congregations which have been formed since the formation of the last-mentioned Union and belong to that Union, but that the congregations which before the formation of the last-mentioned Union belonged to the Evangelical Union are not so eligible.
The Court pronounced this interlocutor—“ Find in answer to the question submitted in the petition that the congregations which the petitioners are entitled to recognise as eligible to participate in the benefits of the Ferguson Bequest provided to ‘The Congregational or Independent Church in Scotland,’ are the congregations which prior to 1896 belonged to the ‘Congregational Union of Scotland,’ irrespective of whether they have or have not joined the new Union called the ‘ Congregational Union of Scotland, comprising the Evangelical Union and Congregational Union as existing at 1896,’ and also the congregations which have been formed since the formation of the last-mentioned Union, and belong to that union, but that the congregations which before the formation of the last-mentioned Union belonged to the Evangelical Union are not so eligible, and decern: Appoint the expenses of all parties in the proceedings … to be paid out of the trust funds,”&c.
Counsel for the Petitioner— Shaw, Q.C.— Tait. Agents— Carment, Wedderburn, A Watson, W.S.
Counsel for the Respondents, the Congregational Union— Guthrie, Q.C.— Craigie. Agents— Coutts & Palfrey, S.S.C.
Counsel for the Respondents Henderson and Glaister— Ure, Q.C.— M'Clure. Agents— J. W. & J. Mackenzie, W.S.