Scottish Court of Session Decisions

In 1894 the estates of the Reverend Alexander Leslie, minister of the united parishes of Evie and Rendall, in Orkney, were sequestrated. The claims admitted to rank amounted to £2161, 15s. 3d.

In January 1900 Mr Leslie presented a petition for his discharge, to which certain of his creditors lodged answers.

From the statements made in the petition and answers it appeared that Mr Leslie's estate had paid 5s. 6d. in the £, that the annual emoluments resulting from his stipend, manse, and glebe amounted to about £273, and that from and after January 1895 all these emoluments, with the exception of £106, had gone to the creditors.

The trustee in the sequestration lodged the following report—“The trustee has to report, in terms of the 146th section of the Bankruptcy (Scotland) Act 1856, that the said Reverend Alexander Leslie has complied with all the provisions of the statute; that he has made a satisfactory discovery and surrender of his estates; that he has attended the diets of examination and has not been guilty of any collusion; and that the bankruptcy has arisen from innocent misfortunes, and not from culpable or undue conduct.”

On 21st December 1899 the Lord Ordinary ( Pearson) pronounced the following interlocutor—“Finds the petitioner entitled to his discharge under the sequestration, on condition that he assigns to his creditors the sum of one hundred and twenty pounds per annum out of his stipend as minister of the united parishes of Evie and Rendall during his incumbency as minister thereof until the whole debts due by him under the sequestration be paid; and on said assignation being granted, grants commission to J. R. Cosens, Esq., Sheriff-Substitute at Kirkwall, to take the declaration of the bankrupt, and to report.”

Mr Leslie reclaimed, and argued—Under section 146 of the Bankruptcy Act 1856, the bankrupt was entitled, provided that his bankruptcy had arisen from innocent causes, and that he had satisfied the statutory rules, to a discharge without conditions. The reasons why a discharge might be refused were enumerated in Goudy on Bankruptcy (1st ed. p. 71), and a refusal by the bankrupt to assign his future income was not among them. The Court could impose conditions, but it could only do so on relevant objections being made, and no objections were relevant which did not ascribe any improper character to the conduct of the bankrupt. Even if a certain amount must be assigned, the amount fixed by the Lord Ordinary was much too large. The bankrupt had to fulfil the duties of a parish minister, was an old man, and might shortly require an assistant. The case of Learmonth v. Paterson, January 21, 1858, 20 D. 418, was not in point, because there the discharge was refused on an adverse report from the trustee.

Argued for the respondents—The Court had a right to make the discharge conditional on an assignation of future income. This was clear from statute (Bankruptcy Act 1856, section 146), which provided that the Court might grant a discharge, “and may annex such conditions thereto as the justice of the case may require,” and had often been exercised in practice, especially in cessio— Learmonth v. Paterson, supra; Scott v. Macdonald, March 5, 1823, 1 Sh. App. 363; A B v. Sloan, June 30, 1824, 3 S. 195; Harris v. His Creditors, June 11, 1836, 14 S. 964; Barron v. Mitchell, July 8, 1881, 8 R. 933; Simpson v. Jack, November 23, 1888, 16 R. 161. 2. If there was power to annex the condition at all, the Lord Ordinary's sum was reasonable. It left more for the minister's support than had been left in the cases above cited.