Scottish Court of Session Decisions

In an arbitration under the Workmen's Compensation Act 1906 between David Donaldson, executor—dative of the late Alfred Donaldson, Dundee, appellant, and John Sharp & Sons, Limited, jute spinners, Dundee, respondents, the Sheriff-Substitute ( Malcolm) refused warrant to record a memorandum of agreement between the said Alfred Donaldson and the respondents, and at the appellant's request stated a Case for appeal.

The facts as set forth in the Case were as follows:—“1. Alfred Donaldson, a minor workman in the employment of the respondents, was on 3rd February 1921 at Bower Mills, Dundee, belonging to the respondents, injured by accident arising out of and in the course of his employment. 2. The respondents paid said Alfred Donaldson compensation under the Workmen's Compensation Act 1906 at the rate of 17s. 6d. per week from the date of the accident until 10th September 1921. 3. On 7th September 1921 a memorandum of agreement between Alfred Donaldson and the respondents was lodged by Alfred Donaldson with the Sheriff-Clerk with a request that it be recorded. The said memorandum of agreement is in the following terms:—‘The claimant claimed compensation from the respondents in respect of personal injury consisting of the loss of the tip of the first finger and the whole of second, third, and fourth fingers and part of the palm of the left hand, caused by accident while in the employment of the respondents at Bower Mills, Dundee, on 3rd February 1921. The question in dispute which was as to the duration of the incapacity of the claimant was settled by agreement which was made on 3rd September 1921 and which was as follows:—(1) the respondents paid the claimant compensation at the rate of 17s. 6d. per week (being 10s. plus 7s. 6d. war addition) from 3rd February 1921 (date of accident) to 10th September 1921; (2) that the respondents should pay into Court in terms of paragraph 17 of the First Schedule to said Act the sum of £375 in full settlement and compromise of said question and of all claims competent to the claimant against the respondents in respect of said accident at common law or under any statute, but this agreement was conditional on its being approved by a curator ad litem to be appointed by the Court to the claimant; and (3) that the respondents pay the sum of £8, 8s. to the claimant's law agent in respect of the expenses incurred by the claimant in connection with said claim and all proceedings following thereon. It is requested that this memorandum be recorded in the special register of the Sheriff Court of Forfarshire at Dundee. Dated this seventh day of September Nineteen hundred and twenty-one.’ Due intimation of the application to record and in terms of C.A.S., lxiii, 11, specifying 15th September 1921 as the expiry of the period within which objections might be lodged was made to the respondents. 4. The genuineness of said memorandum of agreement was not disputed by the respondents at the time, and no objections to the recording of it were lodged by them prior to the death of Alfred Donaldson after mentioned. 5. The said Alfred Donaldson died intestate on 2nd October 1921 from causes unconnected with the accident, no curator ad litem having been appointed and the memorandum not having been recorded. At the date of the said agreement and down to the date of his death he had no curator, his father being insane and an inmate of an asylum. Consequent on his death the respondents by minute marked 13th October 1921 lodged objections to the recording of the memorandum of agreement. The appellant as executor-dative of said Alfred Donaldson was on 14th November 1921 sisted as applicant in his place, and claims that the memorandum of agreement should be recorded, and that as executor he is entitled to payment of the sum agreed on as therein stated.”

The Case further stated—“At the time When the minute of objections for the respondents of 13th October 1921 was lodged there was no claimant in the process, said Alfred Donaldson, the original claimant, having died and the appellant not then having been sisted, and accordingly I allowed the minute for the respondents of 13th October 1921 to be received, reserving all questions of competency. At the hearing on 9th December a preliminary contention on

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behalf of the appellant was stated against the competency of the respondents' minute in respect that, not having been lodged within the period specified as stated in article 3 above, the objections to the recording of the memorandum of agreement were non-timeous. I repelled this contention, and on the merits I held that the alleged agreement being conditional on its being approved by a curator ad litem to be appointed to Alfred Donaldson, that condition was a suspensive one, and it not having been fulfilled and being now impossible of fulfilment, the agreement is inoperative and invalid and should not be recorded.”

The questions of law for the opinion of the Court included the following:—“… 3. Was I right in holding that the agreement is invalid in respect that the condition therein requiring approval by a curator ad litem had not been fulfilled, and in refusing the application for warrant to record the memorandum?”

In a note the arbitrator stated—“… Respondents object to the memorandum being now recorded on the ground that the agreement was conditional on its being approved by a curator ad litem to be appointed to Alfred Donaldson—a condition which was not fulfilled and which is now impossible of fulfilment. In my opinion the objection is well founded. The condition is an express term of the agreement. It is a substantive part thereof, and was intended to have operative effect; it was in fact an act of prudence on the part of respondents to have inserted it for their protection. It was admitted by claimant's agent at the debate that had a curator ad litem been appointed it would have been open to him to have refused approval, and that had he done so the agreement would have lapsed. That admission seems to me to be conclusive of the case. However adequate the sum agreed on may appear to be, and however improbable it may be that a curator ad litem would have withheld approval, I cannot assume his approval, nor substitute the probability of his approval for the lack of it; nor can I depart from the terms of the agreement by waiving the condition and holding it pro non scripto. The condition is in its nature suspensive, and it being now impossible of fulfilment the agreement itself does not become operative.

I was referred to two cases decided in the English Courts, in which as in the present case the death of the workman had taken place between the entering into the agreement and the recording of it. In the first of these, Price v. Westminster Brymbo Coal and Coke Company, 1915, 2 K.B. 128, it was held that where a valid agreement has been entered into for the redemption of a weekly payment, the subsequent death of either party before registration does not prevent the agreement from being recorded. The basis of the judgment, however, is that the agreement was a valid one, and on that ground the case is distinguishable from the present one, in which it is because the agreement was incomplete and therefore invalid that I hold it cannot be recorded. The second case was that of The King v. Registrar of Bury County Court, 1918, 2 K.B. 312, in which the decision turned on the meaning and effect of one of the rules applicable to the Workmen's Compensation Act in England—a rule which so far as I know has no counterpart in Scotland in the Act of Sederunt or elsewhere. The case is further distinguishable in this respect that it turned upon the effect of a general statutory provision or condition, not a term of the agreement, whereas the present case depends on the effect of a provision or condition expressed in the agreement itself as an integral part of it.

The decision in the English case of Popple v. Frodingham Iron and Steel Company, 1912, 2 K.B. 141, to which I was also referred, has little or no bearing on the present one. The third condition enunciated by Buckley, L.J., with reference to agreements, p. 147, and his remarks thereon, p. 148, are, however, apposite to the question of the validity of the agreement here. He states that there must be an agreement to pay in terms similar to a County Court judgment so as to be enforceable as a County Court judgment, that it must not be contingent on an event the occurrence of which would have to be proved as a condition-precedent to issuing execution. According to that test the agreement in the present case is invalid.

I hold, therefore, that the agreement being incomplete and incapable of completion, the application to record it must be refused.…”

Argued for the appellant—It was not an essential condition of the agreement that a curator ad litem should be appointed. Such a condition could not have been intended to apply after the appointment had become unnecessary or impossible. The condition was resolutive not suspensive— Pirie v. Pirie, 1872, 11 Macph. 941; Ward v. Walker, 1920 S.C. 80, 57 S.L.R. 121; Jack v. Roberts & Gibson, 3 Macph. 554; Bell's Prin., secs. 47 and 49; Hendry v. United Collieries, Limited, 1909 S.C. (H.L.) 19, 46 S.L.R. 780.

Argued for the respondents—All that vested in an injured workman was a right to a weekly payment. The Act gave the employer the right to redeem this by a lump sum. Here there could be no completed agreement for such redemption until the approval of a curator ad litem had been given. The memorandum must conform exactly with the terms of the agreement come to by the parties— M'Lean v. Allan Line Steamship Company, Limited, 1912 S.C. 256, 49 S.L.R. 207; Popple v. Frodingham Iron and Steel Company, [1912] K.B. 141, per Buckley, L.J., at p. 147; Smith v. Petrie, 50 S.L.R. 749, Lord Dunedin at p. 751; Ersk. iii, 1, 6; Bell's Prin., secs. 49 and 1785. Counsel also referred to Dunlop v. Rankine & Blackmore, 4 F. 203, 39 S.L.R. 146; and Scott v. Long Meg Plaster Company, (1914) 7 B.W.C.C. 502.