Scottish Court of Session Decisions

In 1866 the Caledonian Insurance Company acquired the dominium directum of certain subjects in Edinburgh from Robert Matheson, who held them under the Governors of George Heriot's Hospital. This disposition was duly recorded. It contained the following clause:—“To be holden … a me vel de me for payment to me and my heirs and successors of one penny Scots money in name of blench farm yearly, and doubling the same at the entry of heirs and singular successors, and declaring that the said Caledonian Insurance Company and its foresaids shall be freed and relieved by me and my heirs and successors, now and in all time coming, of and from payment of the whole feu-duties and casualties payable by me or my heirs to my superiors, as well as from all cess, teinds, minister's stipend, and other public and parochial burdens payable in respect of the said lands or subjects and others, and from all augmentation thereof, all such upper feu-duties and casualties and cess, teinds, and minister's stipends and public and parochial burdens, and all augmentations thereof being payable by me or my foresaids, now and in all time coming, out of the remainder of the foresaid lands belonging to me not hereby disponed.… And farther, I bind and oblige myself, my heirs and successors … to enter with the superiors … And if my heirs and successors shall not so enter, … then I bind and oblige myself and my heirs and successors to pay the whole composition exigible from the said Caledonian Insurance Company on receiving an entry direct from the oversuperiors, and also the whole feu-duties and casualties which may hereafter become payable by it and them to said superiors.”

In 1868 the Caledonian Insurance Company acquired from Robert Matheson the dominium directum of certain other subjects

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also in Edinburgh, and held by him under the same superiors. This disposition contained the following clause:—“And I (the disponer) bind myself to free and relieve the said Caledonian Insurance Company and their foresaids of all feu-duties, casualties, and public burdens imposed and to be imposed and all augmentations thereof both prior to the said term of entry and in all time corning thereafter.” This disposition was duly recorded.

Robert Matheson died in 1877, after the Conveyancing Act 1874 had deprived his heirs of the power of entering with the superiors in pursuance of the obligation imposed upon them in the disposition of 1866. His eldest son made up a title by special service to the whole lands in which his father had been infeft, including those disponed to the Caledonian Insurance Company.

In 1900 the Governors of George Heriot's Hospital called upon the Caledonian Insurance Company to make payment of a year's sub-feu-duties in name of composition due on the death of Robert Matheson.

The Insurance Company admitted that a casualty was due, and raised an action against Matheson's testamentary trustees to have it found and declared “that the defenders are bound to relieve the pursuers of any casualty now payable to or exigible by, or that may hereafter become payable to or exigible by, the superiors (the Governors of George Heriot's Hospital) for and in respect of” the lands described in the dispositions of 1866 and 1868.

On 26th October 1900 the Lord Ordinary (Low) pronounced the following interlocutor:—“Finds (1) that the defenders are not bound to relieve the pursuers of the composition demanded from them by the Governors of George Heriot's Hospital as having become due upon the death of the deceased Robert Matheson in respect of the subjects disponed to the pursuers by the said Robert Matheson by disposition dated the 11th and 12th, and recorded in the Register of Sasines the 20th, days of July 1866; and (2) that the defenders are bound to relieve the pursuers of the composition demanded from them by the said Governors as having become due as aforesaid in respect of the subjects disponed to the pursuers by the said Robert Matheson by disposition dated 11th and 12th, and recorded in the Register of Sasines the 14th days of December 1868: Therefore finds, decerns, and declares in terms of the conclusions of the summons to the extent and effect of the second of the above findings, and quoad ultra dismisses the summons, and decerns,” &c.

Opinion.—“The pursuers acquired the mid-superiority of certain subjects in Edinburgh from the deceased George Matheson of West Coates, by dispositions dated respectively in 1866 and 1868.

Mr Matheson died in 1877, and the Governors of George Heriot's Hospital, who are the superiors of the subjects in both of the dispositions, have demanded from the pursuers payment of a composition of one year's sub-feu-duties in respect of each of the subjects.

The pursuers state that they are advised that the casualties are due, and the object of this action is to have it found that Mr Matheson's trustees are bound to relieve them of the casualties in terms of clauses of relief contained in the dispositions.

The clause of relief in the disposition of 1866 is substantially different from that in the disposition of 1868, and it is therefore necessary to consider the clauses separately.

In the former disposition Mr Matheson bound himself, his ‘heirs and successors,’ to relieve the pursuers ‘in all time coming of and from payment of the whole feu-duties and casualties payable by me or my heirs to my superiors.… And further, I bind and oblige myself, my heirs and successors, at the expense of me or my foresaids, to enter with the superiors, … and if my heirs and successors shall not so enter, then I oblige myself, and my heirs and successors, to pay the whole composition exigible from the said Caledonian Insurance Company or its foresaids on receiving an entry direct from the over-superiors.’

I am of opinion that that clause does not entitle the pursuers to be relieved of the composition in question. Mr Matheson, in the first place, undertakes to relieve the pursuers only of casualties payable ‘by me or my heirs.’ These words do not include the composition payable upon the entry of a singular successor. Further, the latter casualty is dealt with at the end of the clause, where Mr Matheson undertakes that he and his heirs and successors shall enter with the superior, and that they will relieve the pursuers of any composition which they may be called upon to pay by reason of his heirs or successors failing to enter with the superior. I do not think that the pursuers can found upon that clause, because they are liable to pay composition in respect of the implied entry created by the Conveyancing Act, and not because Mr Matheson's heirs have failed to enter with the superior. The obligation to relieve of composition was undertaken in view of the law as it existed at the date of the disposition, under which Mr Matheson's heirs would have been entitled to enter with the superior, and thereby render it impossible for the superior to exact composition from the pursuers. The Conveyancing Act, however, put it out of the power of Mr Matheson's heirs to enter, and I am of opinion that the obligation to relieve of composition, in the event only of the heir failing to enter, cannot be enforced when the composition has become due not through any failure on the heir's part but because a supervening statute has changed the law.

The clause in the disposition of 1868 is in the following terms:—‘I bind myself to free and relieve the Caledonian Insurance Company and their foresaids of all casualties … both prior to the said term of entry, and in all time coming thereafter.’

The defenders contended, in the first place, that a composition was not, prior to the Conveyancing Act, a casualty of superiority. It seems to me that I must regard that point as having been settled adversely

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to the defenders by the judgment in Farquharson v. Caledonian Railway Company, 2 F. 141.

The defenders further contended that the obligation could not be enforced by reason of the change in the law which was made by the Conveyancing Act. But for that Act Mr Matheson's heir could and would have entered with the superior, and a composition could not have been claimed from the pursuers.

I have already expressed the opinion that that change in the law relieved the defenders of the obligation of relief contained in the disposition of 1866, but that is because the obligation was expressly based upon the existing state of the law. Mr Matheson bound his heir to enter with the superior, and it was only if the heir failed to enter that the pursuers were to be relieved of any composition which they might thereby be obliged to pay. The heir, in my opinion, could not be said to have failed to enter when a subsequent statute put it out of his power to enter.

In the disposition of 1868, however, the obligation to relieve of casualties is not conditional but absolute, and the question seems to me to be whether the change in the law operated by the Conveyancing Act so altered the incidence of the casualty that it would not be just and reasonable to regard it as falling within the purview of the contract.

Now, I take it that when Mr Matheson died the position of matters would, if the Conveyancing Act had not been passed, have been this: the superiors—the Governors of George Heriot's Hospital—would have been entitled to call upon the pursuers to enter with them as their vassals, and to pay a composition, and to enforce that demand by a declarator of non-entry. The pursuers, however, could have met that demand by putting forward Mr Matheson's heir. The superiors would have been bound to receive the heir, although—and I think that this is important—they could not have compelled him to enter. The result of the Conveyancing Act, therefore, was simply this, that the true vassal could no longer defeat the superior's claim to a composition by putting forward the heir in a bare mid-superiority. There has accordingly been no change in regard to the casualty, but the pursuers can no longer resort to a device which would formerly have been open to them, to avoid payment of the casualty. It seems to me that that is not a change in the law which entitles the defenders to refuse to implement an absolute and unconditional obligation to relieve the pursuers of all casualties.

The defenders stated one other argument with which I must deal. It appears that the superiors have claimed composition from the pursuers as being due in consequence of the death of Mr Matheson, the disponer. The defenders argue that no such casualty can be claimed in consequence of Mr Matheson's death, because his heir entered with the superiors, and was received by the superiors as their vassal. What happened was this. On Mr Matheson's death his eldest son made up a title by special service to the whole lands in which his father had been infeft, including those disponed to the pursuers, and paid to the superiors the relief duty. The defenders argued that the superiors, having accepted Mr Matheson's heir as their vassal, cannot claim a composition from the pursuers as being due in consequence of the death of Mr Matheson. It seems to me to be plain that that is not a ground upon which the pursuers could have resisted the demand of the superiors for payment of composition, because the pursuers having been entered by virtue of the provisions of the Conveyancing Act, there was no room for an entry to Matheson's heir.

I am therefore of opinion that the defenders are not liable to relieve the pursuers of the composition payable for the lands disponed in 1866, but that they are liable to relieve them of the composition for the lands disponed in 1868.”

The pursuers reclaimed against the above interlocutor in so far as it dealt with the disposition of 1866, and argued—The true construction of the contract between the disponer and disponee was that the disponer would either enter or pay composition; the Legislature having rendered the first alternative obligation impossible, the disponer's heirs were bound to perform the second. Though the pursuers were entered by the operation of the Conveyancing Act, the obligation to enter imposed upon the disponer's heirs remained unfulfilled, and though the Legislature had rendered its fulfilment impossible, it had not rendered it impossible for them to pay composition, and it left the contractual obligation unaltered— Dunbar's Trustees v. British Fisheries Society, December 19, 1877, 5 R. 350, July 12, 1878, 5 R. (H.L.) 221; Dunbar v. Scott's Trustees, July 18, 1872, 10 Macph, 982. In any case, the pursuers were entitled to relief under the obligation to pay all casualties due to the superiors.

Argued for the defenders—Section 4, sub-section 4, of the Conveyancing Act had discharged the defenders' obligation to enter by putting performance of it out of their power— Baily v. De Crespigny (1869), L.R., 4 Q.B. 180; Brown v. Mayor &c. of London, February 1, 1861, 30 L.J., C.P. 225; Lindsay v. Bett, July 13, 1898, 25 R. 1155; Addison on Contracts (9th ed.), p. 134. No provision was made in the disposition for change of circumstances, and in the absence of such provision supervenient legislation, rendering the fulfilment of the obligation there undertaken impossible, must be held to have discharged the obligation— Mayor of Berwick-on-Tweed v. Oswald, May 10, 1854, 23 L.J., Q.B. 321; 3 E. & B. 653; Barkworth v. Young, December 15, 1856, 26 L.J., Ch. 153, at p. 163. The case was similar to those in which the continued existence of the subject was essential to the contract, and its destruction operated a discharge from all the obligations of the contracting parties— Taylor v. Caldwell, May 6, 1863, 32 L.J., Q.B. 114; Appleby v. Myers, June 21, 1867,

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L.R., 2 C.P. 651; Anson on Contracts (9th ed.), p. 333. The obligation to pay all casualties did not include composition— Straiton Estate Company v. Stephens, December 16, 1880, 8 R. 299.

At advising—