Scottish Court of Session Decisions

On 26th April 1906 M'Connell & Reid, flour importers, Glasgow, brought an action in the Sheriff Court there against W. & G. Muir, bakers, Calton, Glasgow, in which they sought to recover £262, 10s., the price of 400 bags of flour sold to the defenders and delivered on 8th March to them.

In defence the defenders pleaded—“(1) The defenders not being indebted to the pursuers in the sum sued for, and being willing to pay any balance that may be due by them to the pursuers, the present action should be dismissed with expenses,” and sought to set off against the sum claimed, the sum of £172, 16s. 3d., the price paid by the defenders for 250 bags of flour which they averred had never been delivered. They made a statement of facts, which with the answers thereto for the pursuers was as follows:—“(Stat. 1) The defenders have often bought flour from the pursuers. Prior to 21st December 1904 they had purchased from the pursuers, but had not received delivery of the 400 bags of flour, and also 250 bags of flour, the price of which, less discount, was £172, 16s. 3d. Notwithstanding the delivery-order mentioned by the pursuers, the defenders have not yet received delivery of the said 250 bags of flour. (Ans. 1) Admitted that defenders have frequently purchased flour from pursuers, and that on 21st December 1904 defenders had not received delivery of the 400 bags of ‘Unity’ flour—same having been sold for forward delivery. Admitted that defenders had prior to 21st December 1904 also purchased from pursuers other 250 bags of flour, but denied that delivery had not been given. Explained that said 250 bags of flour were of ‘Semper Idem’ flour, which were held by Thomas Hayman & Son, carting contractors and storekeepers, 26 Robertson Street, Glasgow, as custodiers, in their Commerce Street Store on behalf of and subject to the order of pursuers, and were purchased by defenders from pursuers on 7th December 1904, ‘ex store,’ at the price of 28s. per bag, with 1¼ per cent. discount for cash in fourteen days, and delivery of same was given by pursuers to defenders on said 7th December by delivery-order addressed to the said Thomas Hayman & Son, granted by pursuers in favour of defenders for said 250 bags of ‘Semper Idem.’ The defenders paid the price of said ‘Semper Idem’ on 21st December 1904, and took the discount of 1¼ per cent. (Stat. 2) On said 21st December 1904 the defenders paid to the pursuers the said sum of £172, 16s. 3d., but they have not yet received delivery of the said 250 bags of flour—Thomson M'Lintock, chartered accountant, Glasgow, as trustee on the sequestrated estates of John M'Nairn & Company, produce merchants and importers, 104 Brunswick Street, Glasgow, having claimed that the same belonged to the said John M'Nairn & Company, and not to the pursuers, and that the pursuers had no title to sell the same to the defenders. (Ans. 2) Admitted that on said 21st December 1904 defenders paid to the pursuers the said sum of £172, 16s. 3d. Quoad ultra not known and not admitted. Explained that upon said 21st December 1904 defenders received from the said Thomas Hayman & Son, to whom the said delivery-order had been addressed, a warrant or certificate of transfer to the following effect:—‘ We have this day transferred to your account 250 bags of flour “Semper Idem” in Commerce Street Store, by order of Messrs M'Connell & Reid, which we now hold subject to your instructions only, you paying the store charges on same.’ (Stat. 3) The question of the ownership of the said 250 bags of flour has been raised in an action of multiplepoinding which is at present pending in this Court, and to which the pursuers and defenders have been called as parties. The record in said action has not yet been closed. The defenders' claim in said action was lodged in order that their rights and the rights of the pursuers might not be prejudiced, and they intend either to withdraw or amend it. (Ans. 3) Admitted that the said action of multiplepoinding is presently pending in this Court, and reference is made to defenders' claim in said action, a copy of which is herewith

The action of multiplepoinding in the Sheriff Court referred to had been sisted pending a decision in a multiplepoinding raised in the Court of Session before Lord Ardwall dealing with tUb same matter—

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Hayman & Son v. M'Lintock, 1900, 13 S.L.T. 863. Both multiplepoindings were raised by Hayman & Son as nominal raisers, Thomson M'Lintock being real raiser. W. & G. Muir were not parties to the Court of Session action. M'Connell & Reid had lodged claims in it, but not in the Sheriff Court action though called as defenders.

On 13th December the Sheriff-Substitute ( Balfour) repelled the defences and decerned against the defenders in terms of the petition, holding that they could not set off the price of the 250 bags of which the ownership was in dispute against the price of the 400 bags.

On appeal the Sheriff ( Guthrie) on 10th February 1900 recalled his Substitute's interlocutor, decerned ad interim for £89, 13s. 9d., and quoad ultra sisted the action.

Note.—“There is a sum of money belonging to the defenders in the pursuers’ hands, for which it may turn out that the pursuers have not given value. It is not a liquid debt by the pursuers to the defenders, but it is in course of being made liquid or the reverse. This is, I think, an exceptional case in which the principle of retention may be extended on grounds of equity apart from usage or mutual contract, for the pursuers, founding on a liquid debt, are shown on probable grounds to be under an obligation to account to their debtor for a large sum arising out of a similar and almost simultaneous transaction. The cases of Munro v. Macdonald's Executors, 4 Macph. 687, and Ross v. Ross, 22 R. 461, cited to me appear to warrant the sist which I have granted in order that the true position of the parties inter se may be fixed.”

The pursuers appealed to the Court of Session, and argued—The Sheriff-Substitute was right. It was owing to defenders' own fault and delay that they did not obtain actual delivery. If the defenders had any claim, it was for damages for failure to implement a contract of sale. The claim was neither liquid nor, as the Sheriff stated, “in course of being made liquid or the reverse.” For the multiplepoinding in the Sheriff Court had been sisted, and, moreover, the defenders now stated regarding their claim therein that they intended “either to withdraw or amend it,” while to the Court of Session multiplepoinding the defenders were not

arties. The pursuers' claim on the other

and was admitted, and the ordinary rule that an illiquid claim cannot be set off against a liquid claim applied— Mackie v. Riddell, November 20, 1874, 2 R. 115, 12 S.L.R. 115; Scottish North-Eastern Railway Company v. Napier, March 10, 1859, 21 D. 700; Mackie v. Mackie, June 15, 1897, 5 S.L.T. 42. The cases of Munro v. Macdonald's Executors, March 30,1800,4 Macph. 087, and Ross v. Ross, March 9, 1895, 22 R. 461, 32 S.L.R. 337, referred to by the Sheriff, were exceptional and special cases. The defenders' present position was inconsistent with their claim in the Sheriff Court multiplepoinding, where they stated that 250 bags of the flour “belonged to the said M'Connell & Reid.”

Argued for the defenders (respondents)—1. The defenders' claim was really liquid; it was for repetition of the price paid. They could not nave got delivery, for according to Lord Ardwall's judgment in Hayman & Son v. M'Lintock, February 22, 1900, 13 S.L.T. 803 (the judgment in which would necessarily rule the Sheriff Court multiplepoinding) the property had never passed from M'Nairn & Company, and therefore, prima facie at any rate, the pursuers had no title to sell. In any case a delay from 21st December (the acknowledgment of intimation of the delivery-order) till after 9th February was not unreasonable. 2. But even assuming the claim was illiquid, it was in process of being made liquid by the multiplepoindings in the Court of Session and in the Sheriff Court, and the action should be sisted to await the result— Munro v. Macdonald's Executors; Ross v. Ross ( cit. supra). In Mackie v. Mackie decree had been given before the counter claim was raised. Mackie v. Biddell was quite different from the present case; it would have been similar if the horse there in question had never been delivered.