Scottish Court of Session Decisions

Lord Dundas—This is an application by a bankrupt for his discharge. By the interlocutor appealed against the learned Sheriff-Substitute allowed the pursuer to answer the objections by the trustee “upon finding caution to the satisfaction of the Clerk of Court for the expenses of this application, and that within a week from this date.” The pursuer is willing and apparently anxious to answer the objections, but he objects strenuously to the condition of doing so upon caution, and that is the subject of this appeal.

It may prove that the application for discharge will not be entirely plain sailing for the applicant, but the point at the moment, and the only point, is whether the condition of caution should be imposed upon him at this stage. I think it should not. I think he ought to be allowed to proceed in the meantime with his application unhampered by this obligation.

In the case of Melrose-Drover, (1905) 7 F. 852, to which we were referred, Lord President Dunedin said that the petition before him was one by a bankrupt for his own discharge, and that is in a different position from a litigation by him about other matters. I do not think that a bankrupt applying for his discharge should be hampered by being ordered by the Court to find caution and the other learned Judges concurred. I do not take it that Lord Dunedin was there laying down a principle to which no exception could be found, but the general rule he states in perfectly distinct terms, and I cannot see anything in what we have before us to take this case out of the scope of that general rule.

I therefore move your Lordships to recal the interlocutor in so far as it orders caution to be found by the pursuer; and quoad ultra to adhere to the interlocutor and remit the matter back to the Sheriff-Substitute.

Lord Salvesen—I concur. We are not in the habit of requiring a litigant to find caution, even though it be plain that he has no means to pay his opponent's expenses should he fail in his litigation. If so, the reasons for a similar practice are much stronger in the case of a man who has been divested of his estate, and who is seeking an opportunity to earn a livelihood free from the debts which led to his sequestration. Everything that he has hitherto earned has fallen into the net of the sequestration. He cannot, therefore, have any means from which to provide for the expenses of his opponents; and if he has no means, it can only be by the charity of his friends that he could implement the interlocutor of the Sheriff-Substitute.

These considerations have led to the settling of a general rule that a bankrupt who is petitioning for his discharge should not be ordained to find caution; and I can find nothing so exceptional in this case, where as yet there has been no inquiry, as to justify a departure from it. I accordingly agree with your Lordship that we should recal the part of the interlocutor appealed against.

Lord Guthrie—I am of the same opinion. There are cases in which a trustee in a sequestration who depends on the assets of the estate to meet his expenses has also the compulsitor that a discharge will not be granted unless the expenses incurred by him are paid. The course proposed by your Lordship does not in the least interfere—when the facts are ascertained, and if the case be a suitable one for applying the compulsitor—with the preservation of the trustee's rights.

The Lord Justice-Clerk was absent.