Scottish Court of Session Decisions

This was an action of multiplepoinding raised in the Sheriff Court at Edinburgh in name of the Life Association of Scotland, pursuers and nominal raisers, by the executrix of the late James Wylie, formerly manufacturer, New Cumnock, for the ascertainment of the rights of certain claimants to a sum of £500 contained in a policy of insurance effected with the Life Association by the said James Wylie on 13th July 1868.

The facts of the case as disclosed by the proof were as follows:—Mr Wylie died insolvent on 23rd April 1900, his whole estate consisting of the sum of £500 contained in the said policy. His daughter, the real raiser, was decerned executrix-dative qua next-of-kin by the Sheriff of the Lothians and Peebles.

In 1868, on the suggestion of Mr W. D. M'Jannet, a solicitor, and with the view of providing security for advances made by M'Jannet to him, Wylie insured his life for £500 with the Life Association of Scotland, for whom M'Jannet was agent. The first two premiums were paid by M'Jannet at Wylie's request. Thereafter M'Jannet continued to pay the premiums as they fell due, Wylie being unable to do so. Before the 1872 premium fell due Wylie disappeared, leaving no address, and from that date until his death in 1900 M'Jannet paid the premiums as they fell due in order to maintain the security for his debt. The policy remained throughout in the hands of M'Jannet, but no assignation of it in his favour was executed by Wylie.

On Wylie's death, in consequence of claims made to the proceeds of the policy by M'Jannet and others, the present action was raised. The fund in medio consisted of the £500 insured by the said policy. Claims were lodged by (1) the executrix, who claimed the whole fund in medio, as executrix-dative qua next-of-kin of the deceased James Wylie, for division among the creditors on his estate; (2) W. D. M'Jannet, who claimed to be ranked primo loco upon the fund in respect of the premiums paid by him, and interest thereon, amounting to £603, 2s. 3d. Claims were also lodged by other creditors of the deceased, to which it is unnecessary further to refer.

The executrix pleaded—“(1) The claimant being executrix—dative qua next-of-kin of the said deceased James Wylie, is entitled to be ranked preferably to the whole free fund in medio.”

The claimant M'Jannet pleaded—“(1) The claimant is entitled to be ranked primo loco upon the fund in medio to the extent of £603, 2s. 3d., being the amount of premiums and interest thereon paid by him, in respect that ( a) under the circumstances stated he is entitled to a lien on the proceeds of the policy for said sum, ( b) the claimant's expenditure of said sum preserved the policy in force.”

On 14th June 1901 the Sheriff-Substitute ( Maconochie), after a proof, pronounced an interlocutor ranking and preferring the claimant, Wylie's executrix, as executrix-dative qua next-of-kin of the deceased James

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Wylie in terms of her claim.

The claimant M'Jannet appealed to the Court of Session, and argued—There was here a de facto although not a formal assignation of the policy to the claimant. It had been effected to secure Wylie's indebtedness to him, and had remained throughout in his custody, and he had paid all the premiums. In these circumstances he was entitled to a preferential ranking over the other creditors. In any view, he had an equitable lien over it as Wylie's agent for the amount of his cash advances— Meikle v. Wilson & Pollard, November 6, 1880, 8 R. 69, 18 S.L.R. 56; Robertson v. Ross, November 17, 1887, 15 R. 67, 25 S.L.R. 62.

Counsel for the executrix were not called upon.

At advising—