Scottish Court of Session Decisions

By section 5 of the Conveyancing (Scotland) Act 1874 it is provided—“Unless where it has been or shall be otherwise stipulated, corporations shall pay at the date at which the first composition would have been payable if this Act had not been passed, and every twenty-fifth year thereafter, a sum equal to what but for the passing of this Act would have been payable on entry by a singular successor.”

The Governors of George Heriot's Trust were the superiors of certain heritable subjects in West Maitland Street and West Coates, Edinburgh.

In 1866 Robert Matheson was the vassal in these subjects and was duly entered with the superior.

By dispositions dated and recorded in 1866 and 1868 Matheson disponed the subjects to the Caledonian Insurance Company, incorporated by royal charter and Act of Parliament.

Matheson died on 5th March 1877. No demand for a composition was made by the superiors from the Caledonian Insurance Company till 16th May 1900, when a composition was paid by the latter.

In October 1902 the superiors raised an action against the Caledonian Insurance Company for payment of £544, 3s., being the amount of a second composition which they alleged was due by the defenders.

The pursuers contended that the date at which the first composition due by the defenders was payable was the date of Matheson's death, and that although this composition had not been demanded and paid till 16th May 1900, the twenty-five years at the expiry of which a second composition was due must be held to run from 5th March 1877.

The defenders on the other hand contended that the first composition was not due till demanded, that the twenty-five years should therefore run from 16th May 1900, and that no second composition was due till 1925.

On 21st July 1903 the Lord Ordinary ( Kincairney) pronounced the following interlocutor:—“Finds (1) that on a sound construction of the fifth section of the Conveyancing Act 1874, the first composition was not payable by the defenders to the pursuers until 16th May 1900; and (2) that the second composition is not due until twenty-five years thereafter: Therefore dismisses the action as premature and decerns,” &c.

Note.—“The Governors of Heriot's Hospital are superiors of certain property in West Maitland Street and West Coates, Edinburgh, and by this action they sue the Caledonian Insurance Company, their vassals in these subjects, for payment of £544, 3s., which they make out to be the amount of the composition payable for the subjects. This form of action is specially authorised by the Conveyancing Act.

The defenders' author was Robert

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Matheson, architect, Edinburgh, who disponed them to the defenders in 1866 and 1868.

Matheson was duly entered with the superiors, and he died on 5th March 1877, and a composition was paid by the defenders to the pursuers on 16th May 1900.

The property is now subdivided into various separate subjects and has been covered with buildings, and various sub-feus have been granted, whether by Matheson or by the defenders does not very clearly appear.

The pursuers seek by this action to recover a second composition, and the principal question in the case is whether it is at present due. The defenders maintain that it will not be due until twenty-five years after the last payment in 1900.

The question depends on the fifth section of the Conveyancing Act of 1874, which provides as to compositions payable by corporations that ‘corporations shall pay at the date at which the first composition would have been payable if this Act had not been passed, and every twenty-fifth year thereafter, a sum equal to what, but for the passing of this Act, would have been payable on entry by a singular successor.’ I refer to the rest of the section, which it is not necessary to quote.

The question is, what, according to the true interpretation of the Act, was the date at which the composition would have been payable according to the law prior to the Act; because a solution of that question will ascertain the time when the next composition is payable, i.e. twenty-five years afterwards.

The pursuers contend that the date at which under the old law the composition would have been payable was the date of the death of the last-entered vassal, and therefore twenty-five years should be counted from 5th March 1877. The defenders contend that the composition would not have been payable until it was demanded or paid, and that therefore the twenty-five years should run from 16th May 1900, the date of payment.

There is a sense in which the composition might be said to have been payable on the death of the last vassal, because then, and not until then, the superiors would have been entitled to take legal steps to recover it by means of a declarator of non-entry; but they could not have recovered it by direct action as if it were the amount of a debt presently due; and if the feu had passed to some-one else—another corporation, for example—before the composition was recovered, then the liability of the defenders would have ceased altogether, and the burden would have been transferred to the succeeding corporation— Mounsey v. Palmer, December 6, 1884, 12 R. 236, 22 S.L.R. 118. I rather think, however, that the question has been removed from the domain of controversy in the Outer House by a very recent judgment of the First Division— Motherwell v. Manwell, March 6, 1903, 5 F. 619, 40 S.L.R. 429, decided by a majority of seven judges. In that case what happened was that the same person (Motherwell) had been in right of the superiority and also of the dominium utile of a particular subject. In 1897 his trustees sold the dominium utile to Manwell, and as the last-entered vassal had died in 1885, Motherwell's Trustees raised an action against the representative of the disponee for a composition.

The defence was, that as after 1885 the superior, and after him his trustees, had been superior of the lands and at the same time the vassal, he was after the death of the former vassal, in 1885, himself both creditor and debtor for the amount of the composition, and that the claim to it was therefore extinguished confusione. But it was held by the majority of the Court that there was no confusion, for that a superior and his vassal did not in such circumstances stand in the relation of creditor and debtor; the only right of the superior being to proceed (under the old law) by declarator of non-entry, and under the Act of 1874 by a direct action, decree in which is declared to have the same effect as a decree of declarator of non-entry. Now in this case no steps whatever, as I understand, were taken by the superiors to recover the composition before 1900, when it was demanded and paid, and it rather appears to me that the judgment in the case of Motherwell precludes me from holding that the composition was ‘payable’ before that. I feel that there are some difficulties attending this view, but I have not been able to overcome the impression that it is necessitated by the judgment cited.

The result is that I must assoilzie the defenders, and I do not require to deal with the other questions as to the amount of the composition.”

The pursuers reclaimed, and argued—The word “payable” in section 5 of the Act of 1874 meant “prestable.” If the Act had meant by “payable” “payable on demand” it would have said so. They were suing for a statutory debt falling due at a certain period irrespective of demand. This construction of the words of section 5 of the Act of 1874 was fortified by the terms of section 113 of the Titles to Land Consolidation Act of 1868, which showed that the composition was due “at the death of the existing vassal, and at the expiration of every period of twenty-five years thereafter.” Both of these sections applied to educational trusts. The case of Motherwell, supra, had no bearing on the present question. The summons in that case was not a petitory summons like the present, and in that case it was also admitted by both sides that a casualty was due if it had not been extinguished confusione.

Argued for the defender and respondent—The Lord Ordinary had rightly decided the case. Section 5 of the Act of 1874 plainly set forth that the first composition was payable at the date it would have been payable if the Act had not been passed. Before 1874 no casualty was due till it was demanded. A composition was not a money debt arising ipso facto on the death of the last-entered vassal. Until a demand for it was made no debt was due by the vassal

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— Motherwell, supra, opinion of Lord Adam, 5 F. 627, 40 S.L.R. 432, and Lord Kinnear, 5 F. 632, 40 S.L.R. 433; Fisher v. Fisher's Trustees, December 8, 1903, 41 S.L.R. 126. Any other decision would lead to injustice to vassals in the defenders' position. The rent of the property in 1900, the year in which the composition was paid, was much larger than the rent of 1877, the year in which the vassal died. So if it was held that another composition was now due it would be for the interest of superiors who had a corporation as their vassal to defer asking compositions till the feu-duties or rents had gone up, and then ask a number of compositions one after another in the same year.

At advising—