Scottish Court of Session Decisions

[1] The petitioner is a Chartered Accountant. He has raised these proceedings in his capacity as Permanent Trustee on the sequestrated estates of the respondent John Rush, now residing at 36 Harbour Place, Burntisland. All he seeks is the Court's authority to uplift certain consigned funds in terms of Section 77 of the Lands Clauses Consolidation (Scotland) Act 1845. These funds comprise the compensation awarded to the respondent by the Lands Tribunal for Scotland in respect of the compulsory purchase of certain lands, together with accrued interest.

[2] The lands in question belonged to the respondent's late father who died in 1985. The respondent was, and is, his sole beneficiary and executor nominate. The first compulsory purchase order was made in 1970 and confirmed in 1971, and the second was made in 1975 and confirmed in 1976. Notices to Treat followed in 1971 and 1976 respectively; the Lands Tribunal for Scotland eventually fixed the compensation for the compulsory purchase in 1998 at the sum of £6,000; Fife Regional Council as the acquiring authority deposited this sum with the Bank of Scotland, along with accrued interest, in 1991; and very shortly thereafter the Council expede and recorded a Notarial Instrument with a view to completing their title to the acquired subjects.

[3] The respondent's father never had a recorded title to the lands in question, and it was only in 1987 that the respondent, as his father's executor, executed and recorded a disposition of the subjects in favour of himself as an individual. Neither the respondent, nor his late father before him, could ever accept the validity of the original compulsory purchase orders, or of any of the formal proceedings which followed them. The Notices to Treat have all along been challenged as invalid; the jurisdiction of the Lands Tribunal for Scotland to award compensation in 1988 was challenged; the validity of the Notarial Instrument expede by Fife Regional Council in 1991 is also in dispute; and the respondent now challenges the petitioner's right, as his trustee in sequestration, to uplift the consigned funds which he also describes as "invalid".

[4] Many years ago, the respondent raised an action in the Court of Session against Fife Regional Council, concluding inter alia for declarator that the two Notices to Treat in 1971 and 1976 were invalid. The Court held that he was entitled to do so independently of such remedies as might or might not exist with respect to the antecedent compulsory purchase orders. The respondent's principal contentions concerned the descriptions of the acquired lands in the compulsory purchase orders and subsequent formal documentation. In particular, he maintained that in various respects the descriptions given (i) failed to comply with statutory requirements; (ii) did not coincide with the later description of the subjects in the respondent's recorded title of 1987, or in the original feu contract with preceded it; (iii) omitted land belonging to his late father and (iv) included land belonging to third parties. The respondent also contended that the relative maps and plans were false and inaccurate, corresponding neither with his father's title nor with the descriptions in the compulsory purchase orders. In addition, he maintained that the lands described in the compulsory purchase orders were not in fact capable of identification on the ground. For these various reasons, he contended that the Notices to Treat in particular should be declared invalid. The action was finally dismissed in 1993, the Inner House holding that it was unnecessary for an acquiring authority to describe lands with the same degree of specification as might be required for a heritable title, and that in the circumstances of this case the particulars of the lands acquired had been adequately given.

[5] When the case called before me on Procedure Roll, the petitioner was represented by counsel and the respondent appeared as a party litigant on his own behalf. The respondent is no stranger to Court proceedings, and was well able to present his own position in argument. Initially, he sought to persuade me that the diet of Procedure Roll should be discharged. He indicated that he wanted to apply for Legal Aid in order to challenge the refusal of another Lord Ordinary to authorise the commencement of a new and separate action against the Lord Advocate and the present petitioner. The purpose of that proposed action was apparently to sue the Court, and certain Judges, in the name of the Lord Advocate for allegedly failing to obtemper Rules of Court at earlier stages of the present proceedings. The respondent's motion for discharge was strongly opposed on behalf of the petitioner, counsel maintaining (i) that even if the respondent had grounds for a separate action, he would not be prejudiced by the debate going ahead; and (ii) that the petitioner, by contrast, would suffer severe prejudice in the event of the present proceedings being further delayed.

[6] I note in passing that some thirty interlocutors have already been pronounced in this cause; that a decree by default in the petitioner's favour has been granted and then recalled by the Inner House; and that leave to reclaim against several other interlocutors has been sought by the respondent without success. Two further diets of Procedure Roll have been discharged; sists for Legal Aid have been refused on at least five occasions since the proceedings were originally sisted for that purpose in 1998; and in the meantime the Closed Record has grown to 106 pages inclusive of the respondent's twenty-three pleas-in-law and relative prayer.

[7] Having heard parties, I was not persuaded that, in the exercise of my discretion, I should accede to the respondent's motion. The discharge was sought for an extraneous purpose which would not be affected by the hearing of a debate, or by my decision thereon. In addition, I took the view that after years of abortive, and expensive, procedure in pursuit of a relatively small sum of money, the interests of justice militated strongly in favour of allowing the petitioner to proceed with the debate on his preliminary pleas which was first appointed to take place in May 2000. I therefore declined to discharge the diet in accordance with the respondent's request.

[8] Turning now to the debate itself, counsel for the petitioner submitted argument in support of his second and fourth pleas directed to the competency and relevancy of the respondent's Answers, and also in support of his third plea directed against the respondent's title to oppose the petition. He invited me to sustain these pleas, to repel the respondent's pleas, and to grant the prayer of the petition. He then proceeded to take me briefly through the petitioner's position on Record, stressing that in asking the Court to implement the machinery in the 1845 Act for the final payment of compensation monies, the petitioner was merely following through the last of a progression of statutory steps. Counsel then referred me to the respondent's previous action against Fife Regional Council, reported at 1995 SLT 454, where the Extra Division refused the respondent's Reclaiming Motion against a decree of dismissal pronounced by the Lord Ordinary. In particular, he drew my attention to the fact that the action sought to challenge the validity of the Notices to Treat on the basis of multiple alleged inadequacies in the descriptions of the acquired lands and in the associated maps and plans.

[9] Against that background, he submitted that the respondent's Answers in the present proceedings were fundamentally irrelevant. They were, he said, an illegitimate attempt to reopen the controversy which had already been litigated and disposed of in the earlier action, and moreover in proceedings to which Fife Regional Council, or their statutory successors, were not parties. All of the previous statutory steps since the making of the first compulsory purchase order in 1970 remained valid and unreduced; no appeal against the decision of the Extra Division in 1993 had ever been taken; that decision was binding on me as regards the legal sufficiency of the key descriptions and plans; but above all the respondent's renewed attempt to cover old ground could not legitimately be pursued in the present proceedings where the proper contradictor was absent, and where the sole relevant issue concerned the uplifting of funds which had vested in the petitioner upon his appointment.

[10] In developing that submission, counsel took me through the whole of the respondent's averments, demonstrating the extent to which Answers 4 to 8 in particular were directed to challenging the validity of the original compulsory purchase orders, the Notices to Treat, the award by the Lands Tribunal for Scotland, and the Notarial Instrument subsequently expede by the Regional Council. His position on these averments may be summarised as follows:-

(1) All of the averments criticising the descriptions of the acquired lands, or the relative maps and plans, were irrelevant in the context of the present proceedings, principally on account of the earlier decision of the Extra Division and the absence of the acquiring authority as a party. The attempt to invalidate the compulsory purchase orders and subsequent procedures was therefore bound to fail.

(2) The purported challenge to the validity of the Notarial Instrument was also irrelevant on another ground, namely that it post-dated the consignment of the compensation monies and their vesting in the petitioner. It was of no concern to the petitioner whether the Notarial Instrument by which the Regional Council took title to the lands was valid or invalid. The sole issue in the present action concerned the uplifting of consigned funds, and in this context even an alleged breach of interdict by the Regional Council in completing their title in 1991 was of no consequence whatever.

[11] Counsel went on to submit that the respondent's eleventh to nineteenth pleas-in-law were incompetent in proceedings to which the acquiring authority was not a party. He also challenged the competency of the respondent's first to fourth pleas-in-law seeking suspension and interdict of the petition and of "further diligence ... which cannot be discharged". If, as the respondent's averments at pages 28 to 30 might possibly suggest, these pleas were designed to implement his argument on prematurity, they were clearly inappropriate and inept.

[12] Counsel then drew my attention to the respondent's further allegations, in Answer 8, that by failing to acknowledge and take up his (the respondent's) long-standing grievances the petitioner was acting unlawfully and contrary to natural justice. In particular, it was averred, the petitioner was knowingly attempting to mislead the Court with a "premature fraudulent petition". The petition was alleged to be fraudulent because it was based on invalid compulsory purchase procedures, and premature because the possibility of an appeal to the House of Lords against the decision of the Extra Division was still open to the respondent and had been the subject of correspondence with the Judicial Office in the period up to 1998. In addition, it was alleged, the petitioner had failed in his duty to take action on the Regional Council's breach of interdict in taking title to the lands acquired in 1991.

[13] In Counsel's submission, these averments also were fundamentally misconceived and irrelevant. The consigned monies were vested in the petitioner as the respondent's Permanent Trustee, and it was entirely a matter for the petitioner, after taking legal advice, to decide whether to seek authority to uplift them or not. He was under no obligation to take up the respondent's grievances if he regarded them as unsound. On the contrary, the Bankruptcy (Scotland) Act 1985 imposed an obligation on the respondent to assist the petitioner in the discharge of his legitimate functions.

[14] My attention was then drawn to the respondent's further averments in Answer 8 (at page 96/7 of the printed Closed Record) to the effect that in 1995 he himself had been interdicted by Lord Murray from uplifting the consigned funds, and that this barred the petitioner from doing so. Counsel for the petitioner explained that despite extensive enquiries his client had been unable to find evidence of any such interdict, and suggested that in the absence of specific vouching the averments were irrelevant.

[15] In counsel's submission, all of the foregoing aspects of the respondent's Answers had been shown to be irrelevant, and the range of purported remedies focused in the respondent's first to fourth, and eleventh to nineteenth, pleas were plainly incompetent in this process. Accordingly, the petitioner's first, second and fourth pleas-in-law should be sustained and the prayer of the petition granted.

[16] Finally, as regards his third plea directed to the respondent's title to oppose the petition, counsel maintained that it was not lawful for the respondent to compete with his trustee in sequestration or with his creditors. In support of this submission, he referred me to the well-known decision of Lord McCluskey in Dickson v UDT 1988 SLT 19, and invited me to sustain the petitioner's first and third pleas and grant the prayer of the petition accordingly.

[17] In reply, the respondent made his position very clear indeed. He addressed me passionately, and at some length, on the merits of his challenge to the validity of the compulsory purchase orders and subsequent proceedings on which the petitioner's claim to the consigned monies was founded. As he put it, "the money was not valid" because of the invalidity of everything that had led up to its consignation. From start to finish, he contended, the exercise was fraudulent and yet here he was, still trying to defend something after half a lifetime that should have been sorted out when he was a young man. If his senior counsel had followed instructions in 1993, and alerted the Court to discrepancies in the scales of the key maps and plans, the outcome of the action against Fife Regional Council would have been different. All in all, the petition was based on "wet, deluded, rotten straw" and should therefore be refused.

[18] As regards the petitioner's argument that these grievances, however genuine, could not competently or relevantly be pursued in the present proceedings, the respondent referred me to the decision of the Inner House in Main v Lanarkshire & Dunbartonshire Railway Co 1895 22R 487. There, a similar application to uplift consigned funds had been held premature where a claim to reduce the arbiter's award on which it was founded was the subject of a pending reclaiming motion before the same Court. In reaching this decision, the Inner House had distinguished a previous case where an equivalent claim for reduction was merely threatened. According to the respondent, his current challenge to the whole historical foundation of the petitioner's claim was not merely threatened, because his action against Fife Regional Council was still alive and the possibility of an appeal to the House of Lords had already been canvassed.

[19] In answer to my questions, he confirmed that he rested his position on the authority of Main. He also confirmed (i) that he had not yet applied for leave to appeal to the House of Lords out of time; (ii) that he was financially embarrassed and unable to fund any such appeal at present; and (iii) that his last communication with the Judicial Office had been in 1998. He would also need two QCs to certify any appeal as suitable for the House of Lords to consider.

[20] On the matter of the validity of the Notarial Instrument, the respondent argued that the petitioner was not indifferent to this issue, as had been claimed, but on the contrary founded on the Notarial Instrument in Article 4 of the petition. In his submission, the whole basis for the petition was "rotten straw" from the original compulsory purchase orders onwards. The present proceedings were, as he put it, democracy in the raw, and the Court must apply the rules in his favour on these issues.

[21] As regards title to sue, the respondent's position was that the case of Dickson was in his favour because (i) he was a discharged, rather than an undischarged, bankrupt; and (ii) Lord McCluskey had held that a bankrupt had title to pursue actions where his trustee would not do so. Accordingly, since the petitioner would not pursue the various reductions for which the respondent contended, he was entitled to pursue them himself. This was it, as he said, "in a kernel". Over and above that, he forcefully maintained that Lord Murray's interdict of 1995, of which he had a copy, barred the uplifting of the consigned funds. He went on to threaten to raise immediate proceedings against the petitioner for breach of interdict and contempt of Court.

[22] In the whole circumstances, the respondent maintained that he had every right to oppose the petitioner's claim, and that standing his challenges to its historical foundation the Court was disabled from granting the prayer of the petition.

[23] In a brief final submission, counsel for the petitioner argued that the case of Main was clearly distinguishable. There, the underlying dispute was before the Inner House at the same time, and involved the same parties. Here, the parties were different, and the respondent's possible appeal to the House of Lords was already some eight years out of time. In these circumstances, he strongly resisted any suggestion that the petition was premature. As regards the interdict granted by Lord Murray in 1995, the documents provided by the respondent at the Bar made it clear (i) that Fife Regional Council were at that time seeking suspension of a charge by the respondent for payment of the sums due under the award of the Lands Tribunal for Scotland in 1988; and (ii) that the Council were also seeking the recall of certain arrestments, together with interdict against the respondent from executing further diligence in their hands. Lord Murray's interdict, which was subsequently confirmed and made permanent by Lord Abernethy, concerned arrestments and other diligence against Fife Regional Council, and not the uplifting of the consigned monies at all. As regards the interlocutors of Lord Clyde and Lord Sutherland referred to at page 97 of the current Record, these concerned the suspension of the respondent's charge and the subsequent award of expenses against him.

[24] Having carefully considered the competing contentions before me, I am satisfied (a) that the petitioner is well-founded in his submission that the respondent's Answers are fundamentally irrelevant and that thirteen of the respondent's pleas-in-law seek incompetent remedies; (b) that the petitioner's challenge to the respondent's title to oppose the petition on its merits is also well-founded; and (c) that it is therefore appropriate for the prayer of the petition to be granted in accordance with the petitioner's motion.

[25] Dealing first with the matter of relevancy, the dispute to be resolved is in the end quite narrow. The vast majority of the respondent's averments concern his contention that, in one way or another, the compulsory purchase orders and all that has followed upon them are invalid. Many of the pleas which he has tabled have a similar focus. I am unable to identify any basis on which these averments and pleas might be given direct effect in the present proceedings, partly because the issues which they raise were largely determined by the Inner House more than eight years ago, and also because these issues arise between the respondent and the acquiring authority and not with the petitioner or even with the Bank of Scotland on whom the petition was originally served for their interest. To be fair, while the respondent addressed me at length on these matters, perhaps in the hope of obtaining judicial assistance to secure practical redress for his grievances, he ultimately appeared to acknowledge that his grievances would have to be pursued elsewhere and that his primary argument was thus that the present proceedings were premature. The case of Main, as he himself put it, was his authority and he rested on that.

[26] It is of course possible to conceive of situations in which a claim for payment of consigned monies might be regarded as premature and inappropriate, for example while a challenge to the very foundation of that claim was still being actively litigated. Main was just such a case, where a challenge to the validity of the arbiter's award on which the consignation had proceeded was already the subject of a pending reclaiming motion before the Court. However, the Lord President in his opinion made it clear, by reference to an earlier case, that where such a challenge was merely threatened, or not far advanced, different considerations would apply and there might be no good reason to delay granting decree for payment. In my view the circumstances of the present case are quite different from those which existed in Main. Here, it is nearly a decade since the respondent sought to pursue his grievances against Fife Regional Council; no appeal to the House of Lords was taken against the adverse decision of the Extra Division in 1993; and although the respondent had some correspondence with the Judicial Office in the period up to 1998 there has been none in the last three years and no steps have been taken towards seeking leave to bring an appeal out of time. It is highly unlikely, in these circumstances, that such leave would now be granted, and in any event I suspect that the respondent's own financial difficulties, and his need for counsel to certify the suitability of any appeal for their Lordships, would probably preclude effective progress in that direction. In my judgment, therefore, renewal of the respondent's challenge to the historical foundation of the petitioner's claim is at best only threatened, and in these circumstances I do not consider that any relevant case of prematurity has been made out.

[27] I therefore consider that all of the respondent's averments on the merits of his threatened challenge, and all his associated pleas-in-law, fall to be regarded as irrelevant. Furthermore, I consider that his plea of prematurity (Plea 22) must be repelled and that his first to fourth, and eleventh to nineteenth, pleas-in-law must be regarded as incompetent in this process and devoid, in any event, of relevant supporting averments.

[28] Moving on to the respondent's specific challenge to the Notarial Instrument by which Fife Regional Council completed their title to the acquired lands in 1991, I am again unable to regard it as relevant in these proceedings. The Notarial Instrument was expede shortly after the monies were consigned and the right to uplift them vested in the petitioner as the respondent's Permanent Trustee. The petitioner's concern is only with these monies, and it is of no interest to him whether the Council ever validly completed their title or not. Even if they did not do so - for example if the respondent's averment that they purported to complete title in breach of interdict is taken pro veritate -, it is hard to see how that could affect the petitioner's right, in a question with the respondent, to uplift monies awarded by the Lands Tribunal for Scotland and deposited by the acquiring authority in the Bank of Scotland. On these grounds, I reject as irrelevant the respondent's averments directed against the alleged invalidity of the Notarial Instrument. In doing so, I note with approval the respondent's own admission (at page 28 of the printed Closed Record) that no question of reduction of the offending Notarial Instrument could arise in these proceedings.

[29] A further important difficulty facing the respondent arises from the fact that he is a (now discharged) bankrupt and that in these proceedings he is opposing the efforts of his Permanent Trustee to uplift funds which vested in him on his appointment. It is well settled that a bankrupt, whether undischarged or, as here, discharged, is under a legal obligation to co-operate with his Trustee in the performance of his functions. This obligation subsists until the Trustee himself is discharged, and in the meantime the Trustee retains full title to administer, for the benefit of the creditors, the estates and assets of the bankrupt which have vested in him. Obviously the bankrupt retains a residual right to pursue causes which the Trustee declines to take up, and to that end may arguably advance administrative pleas such as prematurity or lis alibi pendens in order to ensure that the Trustee's litigation does not unnecessarily prejudice his own. However, it is difficult to envisage any situation in which the bankrupt would have title to oppose the Trustee's litigation directly on its merits.

[30] Against that background, I am satisfied that the respondent has no title to oppose the present petition on its merits, and in particular no title to object to the petitioner's decision to pursue the consigned monies rather than the wide-ranging grievances which the respondent would have wished him to pursue instead. In this connection, I regard the respondent's references to fraud and to misleading the Court as merely colourful language reflecting his frustration and annoyance at what he sees as lack of support from his Permanent Trustee. I am certainly not persuaded that they constitute relevant averments of unlawful conduct on the part of the petitioner.

[31] In my opinion, the same applies to the respondent's suggestion (at pages 96-7 of the printed Record) that the petitioner was disabled from uplifting the consigned monies because the respondent himself had been interdicted by Lord Murray from doing so in 1995. If this averment had been accurate, it would have raised an interesting question to be determined, but as soon as the respondent made available a copy of the interlocutor in question it was obvious that the interdict did not strike at the uplifting of the consigned monies at all. What it did was restrain the respondent from doing further diligence against Fife Regional Council, and in particular from using further arrestments in their hands, at a time when he was actively pursuing payment of the compensation monies awarded by the Lands Tribunal for Scotland. On that basis, the interdict is of no significance for present purposes, and the respondent's averments on the subject are irrelevant.

[32] For all of these reasons, I am persuaded that the respondent has averred no valid defence to the present proceedings, and that this long-running matter should now be determined in the petitioner's favour. I shall therefore sustain the petitioner's first, second, third and fourth pleas-in-law, repel the pleas tabled by the respondent, and grant the prayer of the petition.