Scottish Court of Session Decisions

This was a petition by the governing body of the Glasgow and West of Scotland Technical College, incorporated by a scheme under the Educational Endowments (Scotland) Act 1882, dated 26th November 1886, for the administration of certain existing endowments. The petitioners craved the Court to alter certain provisions of the scheme. The alterations desired by the petitioners were stated by them to be the following:—“First, they desire that in addition to the governors mentioned in the third section, one governor should be elected by the Glasgow Institute of Architects; second, they desire additional borrowing powers as after mentioned; and third, they desire power to grant retiring allowances to their officials or employees as well as to members of their teaching staff.”

By section 27 of the scheme the petitioners were entitled to borrow or expend out of the capital a sum not exceeding £3000 for repairing existing buildings and equipping laboratories, &c., therein.

By the 55th section they were empowered to expend a sum not exceeding £8000 in additions to an existing school, either out of capital or by borrowing.

Both these powers were exercised to their full extent by expenditure out of capital.

By the 72nd section it was provided that “it shall be in the power of the governors, if they see fit, to grant a retiring allowance to any principal, professor, master, or other teacher under the scheme, or to enter into any agreement to grant such retiring allowances on such terms as they may deem expedient, provided always that before granting such allowances, or entering into such agreement, they obtain the sanction of the Scotch Education Department thereto.”

The petitioners stated with regard to the proposed borrowing powers that the buildings in which they carried on their work were “for the most part very old and quite unsuitable for the purposes of a modern technical college,” and that they proposed to erect new buildings. They stated that subscriptions to the amount of £173,818 had been already intimated. Of that sum £88,933 had been paid, but in many cases payment of the promised subscriptions was to be spread over a period of five years. The petitioners stated that they would have to make interim payments to contractors which would exhaust the funds in hand before the end of three years, and before sufficient of the unpaid subscriptions became available.

The petitioners accordingly asked for power to borrow or expend out of the capital from time to time a sum not exceeding £30,000 to meet these payments.

With regard to the power of granting retiring allowances the averment of the petitioners was as follows:—“The petitioners think it expedient that the governing body should have the power of granting retiring allowances to any of their officials or employees, as well as to members of their teaching staff, on terms similar to those provided in section 72 of the scheme.”

The consent of the Scotch Education Department was obtained to the presentation of the petition.

No answers were lodged.

The Court remitted to Mr J. Edward Graham, advocate, to report upon the proposed alterations.

The reporter reported generally in favour of the proposals.

With regard to the third proposal he made the following observations:—“By section 72 of the scheme the governors are empowered to grant retiring allowances to any principal, professor, master, or other teacher under this scheme,' with the sanction of the Education Department. The petitioners desire to add the words, ‘and to any of their officials or employees.’ In the case of The Governors of Dollar Institution, 18 R. 174, the petitioners asked the Court to alter their scheme so as to empower them to grant retiring allowances to ‘teachers who were old and infirm’ at the passing of the scheme, or who had lost their appointments through the passing of the scheme. The Court refused the petition on the ground that it was truly an application for power to make payments to certain persons, and not for an alteration of the scheme of the nature contemplated by the Act. In the case of The Governors of Logan and Johnston School, December 5, 1890, 18 R. 190, the petitioners asked for power ‘to make such compensation as they think just and reasonable to teachers or other officers in schools which are discontinued under this scheme.’ Their Lordships of the Second Division, without comment on the above case of Dollar, granted the petition. In the case of The Governors of Heriot's Trust, November 17, 1897, 25 R. 91, the petitioners stated that their scheme made provision for compensation to employees whose services

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were no longer required in consequence of the scheme, but contained no further provision as to the payment of retiring allowances. They asked the Court to empower them to grant retiring allowances to teachers and to ‘any other officials or employees of the Trust in accordance with a scheme to be approved by the Scotch Education Department.’ The Court granted the petition. It is to be observed that in the above cases the governors possessed under their schemes no general power of granting retiring allowances to teachers, whereas in the present case the petitioners already possess such a power (subject to the sanction of the Education Department) in the case of ‘any principal, professor, master, or other teacher.’ All that the present petition asks, therefore, is that the power may be extended so as to include any of their officials or employees.’ There appears to be no reason why they should not have the same powers regarding ‘officials’ as they already possess in the case of teachers.”

The following proposed alterations in the scheme as amended by the reporter were submitted to the Court in a schedule annexed to thereport:—“(1) (A clause with regard to the additional governor); (2) Where as the governors are now (June 1902) about to erect a technical college upon ground recently acquired for that purpose, and whereas a sum of £173,818 has been subscribed for the cost of the said college, the whole of which will not be paid for some time, and whereas the governors will require to make payments to the contractors for the new buildings from time to time before all the said subscriptions have been paid; Therefore it shall be in the power of the governors, for the purpose of meeting the expenditure upon the said buildings, to borrow money, or to expend money out of the capital of the endowments, from time to time, to an extent not exceeding at any one time the sum of £30,000, on such terms that the money so borrowed or expended out of capital shall be repaid within not more than ten years, either by annual repayments, or by annually setting aside sufficient to repay the money so borrowed or expended within not more than ten years. (3) Section 72 of the scheme shall be amended by adding after the word ‘scheme’ the words ‘and to any of their officials or employees.’”