Scottish Court of Session Decisions

James G. Stewart, commercial traveller, Forres, brought an action in the Sheriff Court of Perthshire at Perth against Alexander Hannah, law-agent, Union Bank House, Aberfeldy, in which he sued him for £500 as damages for alleged slander contained in a letter of 18th February 1005 written by the defender to the General Accident Assurance Corporation, Limited, Perth.

The pursuer's averments showed that after the death of his brother, Mr William Robert Stewart, a Mr Charles Munro, the local agent for the Union Bank of Scotland at Aberfeldy, solicited the agency in the executry estate, and that an arrangement was come to that Munro should wind up the estate, it being understood, however, that the actual conduct of the business was to be undertaken by the defender Alexander Hannah, who was associated in business with Munro. The pursuer understood that he and his mother were to be appointed joint-executors to his brother, but as a matter of fact the mother, a lady of nearly eighty years of age, was appointed sole executrix. The defender undertook the legal business connected with the winding up of the estate, but the pursuer and his mother being dissatisfied with the conduct of Munro and the defender made a demand for payment of all moneys belonging to the executry estate, and the mother, as executrix, ultimately brought an action of count, reckoning, and payment against the defender and Munro in the Sheriff Court at Perth. The defender thereupon wrote the following letter to the General Accident Assurance Corporation, Limited, Perth, who were cautioners in the executry:—

“Union Bank House, ‘Aberfeldy, 18th February 1905.

“Dear Sir,— W. R. Stewart's Exy.—You will remember that your company recently became cautioners for the executrix in this case, and that before doing so I guaranteed to your company that the estate would be divided by me according to law. I am sorry to say that the executrix left here before I could divide the estate, and is now staying in Forres with her son. This son is demanding payment of the whole estate in name of his mother the executrix, and has employed an agent to recover it. Now, I do not think that we can very well keep the estate out of the hands of the executrix if she chooses to employ another agent, but I think it right to intimate to you that of course my personal guarantee in the circumstances is inept, and such being the case your position as cautioners is such that I think you ought to withdraw your bond of caution, and should intimate this, on receipt of my letter, to the Sheriff-Clerk, because I have reason to suspect that if the son who is demanding the whole estate gets hold of it, the other beneficiaries will never receive the share they are entitled to, and I am aware that the others interested are likely to take steps to compel a settlement of their claims. Meantime you must proceed to protect yourself.—Yours faithfully,

“ Alexander Hannah.”

This letter was lodged by the defenders in the process of the action of count, reckoning, and payment, already referred to, and in this manner came to the knowledge of the pursuer.

The pursuer further averred (Cond. 6)—“The following statements contained in the said letter of 18th February 1905, viz., ‘This son is demanding payment of the whole estate. … I have reason to suspect that if the son who is demanding the whole estate gets hold of it the other beneficiaries will never receive the share they are entitled to,’ were made by the defender of and concerning the pursuer to the said Assurance Corporation and to the officials thereof. The statements are false and slanderous, and were made maliciously and without probable cause, and by making these false, malicious, and libellous statements to said Assurance Corporation, and to the officials thereof, defender meant thereby that pursuer was a dishonest person who was not to be trusted, and that he would fraudulently misappropriate money that did not legally belong to himself, and that he would illegally withhold money belonging to other persons if any money were placed in his hands, and would cheat and defraud the other beneficiaries entitled to a share of his said late brother's estate.

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(Cond. 8) … Defender by so writing meant to falsely, maliciously, and slanderously charge the pursuer as a dishonest person who was not to be trusted with money, and that pursuer wanted to secure the possession of the funds of the executry estate of his said late brother, and to fraudulently apply them to his own purposes, and defraud and cheat the other beneficiaries of their legal shares, without the knowledge of the executrix, who had the legal control of said funds, and by said letters defender urged said corporation ‘to protect’ themselves against pursuer inconsequence of the character given him by defender.” [The following averments were added by way of amendment with the leave of the Sheriff, Christopher N. Johnston—] “The defender in writing said letter was not acting in the discharge of any right or duty incumbent on him, but he maliciously wrote said letters with the object of preventing the executrix obtaining the executry funds and papers, delivery of which she had lawfully demanded through another law-agent, and defender recklessly slandered the pursuer in the manner libelled in a malicious attempt to induce the said Assurance Corporation, whose guarantee premium had been paid by the executrix, to withdraw, if possible, their bond of caution, and thereby hinder and obstruct the executrix in the proper administration of the estate, and to prevent his own discontinuance as law-agent, and also prevent or delay the executry funds being taken out of his own hands, or out of the hands of the said Charles Munro with whom he was associated in business.”

The pursuer pleaded, inter alia—“(2) The statements complained of by the pursuer being false and calumnious, he is entitled to solatium for the slanderous imputations there by made by the defender in regard to him. (3) The said written words complained of by the pursuer having been uttered in regard to him by the defender, and intended and understood to bear the actionable meaning put upon them by pursuer in the condescendence, he is entitled to reparation from the defender. (6) The defender not having been privileged in making said false and slanderous statements regarding the pursuer, but having made the same maliciously, decree should be granted as craved.”

The defender pleaded, inter alia—“(1) The pursuer's statements being irrelevant, the action ought to be dismissed. (2) The statements complained of not being in themselves slanderous, and not being capable of bearing the construction attempted to be put upon them by the pursuer, the defender ought to be assoilzied. (3) The statements complained of being privileged, the defender ought to be assoilzied.”

The Sheriff-Substitute ( Sym) on 19th June 1905 pronounced an interlocutor sustaining the first plea-in-law for the defender and dismissing the action.

The pursuer appealed to the Sheriff, who on 28th July 1905 pronounced an interlocutor allowing the pursuer to amend his record in the manner indicated in the averments quoted from Cond. 8, and allowing parties a proof before answer.

The pursuer appealed to the Court of Session, and proposed the following issue for the trial of the cause by jury—“Whether on or about 18th February 1905 the defender wrote and despatched the letter printed in the schedule annexed; whether the statements in said letter are of and concerning the pursuer, and falsely and calumniously represent that the pursuer would dishonestly appropriate money that did not belong to him, to the pursuer's loss, injury, and damage.”

The defender opposed the granting of the issue, and argued—(1) The letter would not bear the proposed innuendo, as it did not necessarily, or even naturally, suggest a charge of dishonest appropriation. (2) In any case the letter was privileged, written as it was by one co-guarantor to another upon a matter in which they were jointly interested, and in circumstances conferring a duty—or at anyrate a right or interest—on the one side to make and an interest on the other to receive the communication—Odgers on Libel and Slander 264; M'Dougall v. Claridge, 1808, 1 Campbell 267; Hunt v. Great Northern Railway Co. (1891), 2 Q.B. 189, at 192; Macdonald v. M'Coll, July 18, 1901, 3 F. 1082, 38 S.L.R. 781; Farquhar v, Neish, March 19, 1890, 17 R. 716, 27 S.L.R. 549; Innes v.Adamson, October 25, 1889, 17 R. 11, 27 S.L.R. 26. (3) The letter being privileged, and malice having to go into the issue, there must be on record a relevant averment of “facts and circumstances inferring malice.” There was none— Farquhar, Innes, and Stevenson v. Wilson, January 16, 1903, 5 F. 309, 40 S.L.R. 286.

Argued for the pursuer and appellant—(1) The statements complained of could reasonably bear the proposed innuendo; that was sufficient. (2) The occasion was not privileged, or if privileged the defender exceeded his privilege, he being only entitled to inform the company that he had ceased to act as agent. In any case the question of privilege was for the judge who might try the case. (3) Condescendence 8 contained a sufficient averment of “facts and circumstances”if such an averment were necessary— Buchanan v. Corporation of Glasgow, July 19, 1905, 42 S.L.R. 801.