Scottish Court of Session Decisions

The Royal Burghs (Scotland) Act 1822 (3 Geo. IV. cap. 91), commonly known as Sir William Rae's Act, which provides in section 1 for accounts of the Common Good and revenues of the Royal Burghs, made up to the day preceding the annual general election of the magistrates, being stated annually, in section 3 enacts—“And be it enacted that every such annual account shall be deposited in the office of the town-clerk of the burgh to which it appertains within three months after the annual election of the magistrates thereof; and such account shall remain there for thirty days after the expiration of the said three months, open to the inspection of the

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burgesses, who may state objections thereto in writing, either during that time or within two months after the expiration of the said thirty days, and be entitled to call, in writing, for the production of any particular vouchers; and if upon such objections being made the party or parties making the same shall not be satisfied with the explanations which may or shall be thereupon given, it shall and may be lawful for any three or more burgesses of such burgh, within three calendar months after the expiration of the said thirty days, to make complaint in writing to the barons of the Court of Exchequer in Scotland, who shall proceed to determine the same in a summary manner, and to make and establish such rules and regulations, as to the said barons shall seem meet, for hearing and determining all matters that may come before them upon such complaints: Provided always, that no objection shall be stated in any such complaint that had not been previously during the time above mentioned stated in writing to the accounts, unless upon a sufficient cause shown, to the satisfaction of the said barons, why such objection was not then stated.”

Section 10—“And be it further enacted, that in the event of no complaint being made to any annual account within the time herein limited, it shall not be competent thereafter to complain to such Court in regard to such account.”

The Royal Burghs (Scotland) Act 1833 (3 and 4 Will. IV, cap. 76), commonly known as the Burgh Reform Act, which provides for the election of town councils in Royal Burghs, in section 32 enacts—“And be it enacted, that the existing magistrates and council in all Royal Burghs shall, on or before the fifteenth day of October in the present and in all future years, make up a distinct state of their affairs subscribed by the chief or senior magistrate, town-clerk, and treasurer, containing an account of all the funds, properties, and revenues since they came into office, which amount shall be brought down as nearly as may be to the said fifteenth day of October, and shall be kept in the town-clerk's or treasurer's office, for the inspection of any of the registered electors, from the said fifteenth day of October down till the time of the election; and a full and distinct abstract of the said account, with a balance sheet containing all necessary particulars, shall be printed and published by the said magistrates on or before the twentieth day of the said month of October.”

The Glasgow Municipal Act 1879 (42 and 43 Vict. cap. cxxiii.), section 10, enacts—“The Lord Provost, Magistrates, and Council may cause the state of affairs which they are required to make up annually on or before the fifteenth day of October in each year, by section 32 of the Act third and fourth William IV, chapter 76, to be made up as at the thirty-first day of May in each year, with the annual accounts or statements of the various other trusts under their administration, and the said thirty-first day of May shall be substituted for the said fifteenth day of October; and no other annual state of affairs or account than that hereby authorised shall be required to be made up by them.”

The Town Councils (Scotland) Act 1900 (63 and 64 Vict. cap. 49), in sections 91 to 99, makes new provisions for the burgh's accounts and their auditing; but by section 109 it allows the town council of any of the burghs mentioned in Schedule II of the Burgh Police (Scotland) Act 1892 (of which Glasgow is one, which has exercised the power), by a resolution, passed at any time within twelve months of the passing of the Act, to declare that the sections dealing with certain matters, inter alia, the accounts, shall not be applicable, in which case the previously applicable Acts thereby repealed shall remain in force or revive in that burgh.

On June 7th 1907 George Eadie and others, burgesses of the City and Royal Burgh of Glasgow, presented a petition and complaint to the Court of Exchequer under the Acts 3 and 4 Geo. IV, c. 91, and 19 and 20 Vict. c. 56, and relative Acts of Sederunt, against “the Right Hon. William Bilsland, Lord Provost; Peter Gordon Stewart, brush manufacturer …. [ here followed a list of names and designations] …. all members of the Town Council of Glasgow, being the Lord Provost, Magistrates, and members of the Town Council of the City and Royal Burgh of Glasgow.” In it they objected to the following entry in the abstract of the annual accounts of the burgh revenues for the year ending 31st May 1906, viz,—“Taxation of Land Values (Suspense Account), including £1142, 9s. 6d. spent during the year, £2457, 2s. 1d.”—and sought to have it disallowed as a charge against the Common Good.

Answers were lodged, certain individuals presenting a minute of disclaimer, in which there was stated the preliminary plea that the complaint had not been timeously presented. The election of Magistrates in Glasgow in the year 1906 was on 9th November.

The facts are given in the opinion ( infra) of the Lord Ordinary in Exchequer Causes ( Johnston), who on 19th July 1907 pronounced the following interlocutor:—“Sustains the minute of disclaimer for James Hunter and others: … Finds the remaining compearing respondents liable in expenses to the said James Hunter and others: Modifies the same at £3, 3s., for which sum decerns against the said remaining respondents: Having heard counsel for the petitioners and complainers, and for the said remaining respondents, on the preliminary objection for the latter that the petition and complaint has not been timeously brought, and considered the cause, Repels the said objection: Appoints the said remaining respondents to produce in process … a detailed account, with relative vouchers, of the item on page 16 of their abstract of accounts, which is the subject of objection and complaint: Grants leave to reclaim.”

Opinion.—“George Eadie and others,

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burgesses of Glasgow, in this petition, presented to the Court of Exchequer in Scotland, challenge the application by the Corporation of Glasgow of any part of the Common Good of the burgh towards payment of expenses incurred by the Corporation in promoting legislation for the taxation of land values. The particular entry in the abstract statement of the revenue and expenditure of the Common Good of the Corporation of the City of Glasgow for the year ending 31st May 1906, to which objection is taken, is to be found on page 16 of the abstract, and is this—‘… [ quotes, supra] … This entry appears under a heading of open accounts on the credit side of the abstract.

“The Corporation, or rather those members who appear to defend, for a large number have disclaimed the defence, state the preliminary plea that the objection was not timeously taken, and that it is now, by virtue of section 10 of Sir William Rae's Act of 1822, incompetent to complain to the Court in regard to any entry in the account for the year ending 31st May 1906.

I have heard an exhaustive argument on this preliminary point, but am prepared without further delay to dispose of it against the contention of the Corporation. I think that the objection was timeously stated, and that there is nothing to prevent my entertaining the complaint on the merits.

As the contention was seriously maintained, and as the Corporation intimated that they desired an authoritative construction of the statutes bearing upon this point, which is doubtless of importance to the Finance Department of the City, it is right that I should explain at some length my reasons for coming to the above conclusion.

There was passed in 1900 the Act 63 and 64 Vict. cap. 49, for consolidating and amending the law relating to the election and proceedings of town councils in Scotland. That Act, which was intended to be of general application, repealed a great number of previous statutes connected with these matters with a view to the codification as well as the supplementing of their provisions, and, in particular, it repealed the following Acts bearing upon the particular point here in question, viz., the Act of 1822 (3 Geo. IV, cap. 91), for regulating the mode of accounting for the common good and revenues of the Royal Burghs of Scotland, commonly known as Sir William Rae's Act; and the Act of 1833 (3 and 4 Will. IV, cap. 76), for altering and amending the laws for the elections of magistrates and councils of the Royal Burghs in Scotland, commonly called the Burgh Reform Act. Having repealed these statutes, the Act of 1900, in sections 91–99, enacted a code for regulating the accounting for the corporate property of burghs, including not only property, heritable and moveable, vested in the council, but also all rates or assessments levied, and all money received and expended by or on account of the Council. One of its most important provisions (sections 94 and 95) related to the audit of the burgh accounts and the securing the appointment of independent auditors by placing the appointment in the hands of the Secretary for Scotland. Another (section 96) related to the council's approval and publication of their annual accounts with a view to their inspection by ratepayers or electors interested, and an appeal to the sheriff of the county by any such ratepayer or elector, dissatisfied with the account or any item therein, was provided. But unfortunately the influence of the five larger burghs in Scotland interfered with the generality of its application, and enabled them to obtain, in section 109, a virtual exemption from this general Act. That section provided that, notwithstanding anything in the Act contained, it should be in the power of the town council of any of these five larger burghs, including Glasgow, by resolution passed within twelve-months of the date of the Act, to declare that any sections or sub-sections of the Act relating, inter alia, to ‘accounts and corporate property specified in such resolution shall not be applicable to such burgh, and that in lieu thereof the corresponding sections or sub-sections, if any, of an Act or Acts applying to such burgh, repealed by this Act, which sections or sub-sections shall be specified in the resolution, shall, notwithstanding such repeal, remain in force or revive within the burgh.’

Now, two of the statutes applying to the burgh of Glasgow (as they were general statutes) repealed by the Act were the above-mentioned Sir William Rae's Act of 1822 and the Burgh Reform Act of 1833, and they contained corresponding sections relating to accounts and corporate property. Accordingly within the statutory period the Corporation of Glasgow resolved that, inter alia, sections 91 to 97 of the Act of 1900 should not he applicable to Glasgow, and that in lieu thereof the following corresponding sections should remain in force or revive, viz., sections 1 to 4, and 9 and 10 of Sir William Rae's Act of 1822, and section 32 of the Burgh Reform Act of 1833.

Accordingly the statutory provisions with regard to the accounts of the city of Glasgow are to be found in these sections, subject to certain qualifications by the city's local Acts.

It must be borne in mind that when Sir William Rae's Act passed in 1822 the councils of Scottish Royal Burghs were close corporations, perpetuated by the system of co-option, and that, disregarding charitable mortifications vested in the corporation, the burgh revenue was substantially derived from the Common Good; and further, that although the Burgh Reform Act of 1833 restored or created the system of free election, the revenue of burghs still continued at that date to be similarly derived. But Sir William Rae's Act contemplated that there might be revenue derived from other sources, as from cess or any local tax or imposition, and provided accordingly. So also did the Burgh Reform Act of 1833, for it calls for an account not merely of property but of revenue generally. And this the Act of 1900 amplified to ‘rates or assessments levied and money received or

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expended by or on account of the council.’ All these statutes therefore contemplated that the accounts they respectively required should be comprehensive. But in Glasgow separate accounts for separate funds are required by local statutes—see the Glasgow Police Act 1866, sections 23, et seq., and the Glasgow Corporation Act 1884, section 44. Hence it has come to pass that the accounts of the Common Good of Glasgow are in use to be kept separate. And it will be found that the accounts with which we are here concerned are confined to the Common Good of the burgh.

That being premised, I would now draw attention to the enactments of Sir William Rae's Act of 1822. It proceeded on the preamble that it was expedient that regular accounts should be annually stated and exhibited of the Common Good of the Royal Burghs of Scotland, showing the property and funds as well as the encumbrances affecting the same and the receipts and disbursements in every year, and that provision should be made for preventing and redressing any error or wrong that may be committed in the administration of the Common Good, and therefore enacted (sec. 1) that ‘a particular account of the common good and revenues of every royal burgh in Scotland made up to the day preceding the general annual election of magistrates in each burgh shall be annually stated and deposited in the manner directed by this Act.’ This account was to be certified by the Provost in terms of a statutory certificate.

It was then enacted (sec. 3) that ‘… ( quotes, supra)… .’

I must here note that the annual election of the magistrates is not a loose expression intending to refer to the election of the council. The Act in several passages carefully distinguishes between the council as a whole and the magistrates, and when it refers to the annual election of the magistrates it means, in my opinion, the election of magistrates properly so-called by the council. Under this statute, therefore, the maximum period for the lodging objections to the burgh accounts was three calendar months plus thirty days plus two calendar months, and for complaining to the Court of Exchequer one calendar month more. And it is admitted that the petitioners' letter of objections of 7th May 1907 and their subsequent complaint to this Court were timeous if the limitation of time imposed is to be found in this statute. I should have said that the Act (sec. 10) further enacted ‘… ( quotes, supra)….’

But, then, matters do not rest on this statute alone. The Burgh Reform Act of 1833 provided, by section 32, which, as above mentioned, notwithstanding its repeal, remains in force or is revived quoad Glasgow, ‘… ( quotes, supra)… .’

This is the whole provision contained in the Act of 1833 regarding corporate property and accounts, and it is quite clear that its provisions had a totally different purpose from, and did not supersede those of, Sir William Rae's Act of eleven years previous. The object of that Act was to secure honest and accurate accounting, the exposure of the burgh accounts to the inspection of the burgesses, and their correction, if necessary, by the Court of Exchequer. But the object of the Burgh Reform Act of 1833 was electoral merely. In contemplation of the annual election in the month of November, it provided for the inspection of the burgh accounts, not by burgesses with a view to correction, but by registered electors, clearly because the disclosures of the burgh accounts for the past year had or might have a material bearing on the question of the election and re-election of candidates. And consequently the Act of 1833 contained no provision for objection or complaint to the Court of Exchequer or any other authority. Hence I am clearly of opinion that, though there may have been an awkward overlapping of dates, involving the statutory deposit of the same accounts on two different dates, for two different purposes, and with entirely different consequences, that is no possible reason why the important and salutary provisions of the former statute of 1822 should be held as virtually abrogated by those of the later statute of 1833.

“Nor do I think that this virtual repeal is effected by the qualification introduced into the Act of 1833 by the local Glasgow Municipal Act of 1879 (42 and 43 Vict. cap. cxxiii). This Act (section 10) provides that the Council may cause the state of affairs which they are required to make up annually on or before 15th October by section 32 of the Act of 1833, ‘to be made up as at the thirty-first day of May in each year, with the annual accounts or statements of the various other trusts under their administration, and the said thirty-first day of May shall be substituted for the said fifteenth day of October.’ Pausing there and reading section 10 of the local Act of 1879 into section 32 of the General Act of 1833, it only amounts to this, that the Council shall on or before 31st May in each year make up a state of their affairs brought down as near as possible to that date, which account shall be kept in the town-clerk's or treasurer's office from the said 31st of May down to the time of the election, and an abstract shall be printed and published on or before 20th October. The result is merely to anticipate the date of closing the burgh's accounts for the year, and to subject them to the inspection of the registered electors for a very much longer period. But as, in my opinion, the provisions of section 32 of the Act of 1833, in their original form, in no way abrogated the provisions of Sir William Rae's Act of 1822, neither do they do so when qualified by section 10 of the local Act of 1879.

But then the last-mentioned section concludes—‘and no other annual state of affairs or account than that hereby authorised shall be required to be made up by them,’ The only result; so far as I can see, of this latter provision is to remove any doubts as to whether two different accounts, one under the Act of 1822, and the other under the Act of 1833, as modified by that

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of 1879, were required. If before there was any doubt on the subject, for the future one account only was required to satisfy the provisions of both sets of enactments. But this does not result in the provisions for its exhibition to the registered electors for the purposes of the Burgh Reform Act of 1833 superseding the necessity of its exhibition to the burgesses for the purposes and under the conditions of Sir William Rae's Act of 1822. I am here concerned with the purposes of the last-mentioned Act only, and for these purposes the calendar or series of dates specified in that Act still regulates procedure. And as on that hypothesis it is admitted that the objections and complaint now before me are timeous, I must repel the preliminary objections stated for the Corporation, and I think that the best step which I could take at this period of the session to advance the process is to ordain the Corporation at or prior to the first box-day in vacation to produce in process a detailed account, with relative vouchers of the item in their abstract of accounts, which is the subject of objection and complaint.”

The respondents reclaimed.

Before the reclaiming note was heard, certain of the respondents lodged a minute of disclaimer in the following terms—“Gordon, for the minuters, stated to the Court that they gave no instructions or authority for appearance being entered or answers being lodged in their names or on their behalf in this petition and complaint, or for their being represented in the procedure therein before the Lord Ordinary in Exchequer causes; that they were not members of the Corporation when the expenditure objected to was incurred, and strongly object to it, and only recently was it brought under their notice that appearances had been made or answers lodged in their names or on their behalf. And he further stated that the minuters gave no instructions or authority for the presentation of the reclaiming note against the Lord Ordinary's interlocutor of 19th July 1907 in their names or on their behalf, and accordingly the minuters disclaim all said proceedings unwarrantably taken in their names or on their behalf.”

Counsel for the minuters, in moving the Court to sustain the minute with expenses against the compearing respondents, stated that in the Outer House the Lord Ordinary had sustained a similar minute for certain other disclaimers, and had found them entitled to expenses ( vide interlocutor, supra).

Counsel for the Corporation opposed the motion, on the ground that the minute was unnecessary, seeing that the minuters were called as members of the Town Council and not as individuals, and even if they disclaimed as individuals they could not do so as members of the Corporation, so long as a majority of that body resolved to appear and defend.