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(1816) 6 Paton 243
CASES DECIDED IN THE HOUSE OF LORDS, UPON APPEAL FROM THE COURTS OF SCOTLAND.
No. 51
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House of Lords,
Subject_Road Trustees — Liability for Sums Borrowed — Relief. —
Held, that mere presence at meetings of road trustees, at which certain things were authorized to be done, and contracts to be gone into in regard to the formation of a road, does not per se, subject such trustees in personal liability for the expense of the execution of these contracts, where the trustees are acting ultra vires of the powers conferred by the Act; and that the only acts which could bind trustees in such circumstances, would be the actual signing of the deeds or contracts by which the money was raised and the expenses agreed to be paid to the individuals by them. Affirmed in the House of Lords; the Lord Chancellor ruling, that where trustees, in such cases, confine themselves strictly within the powers conferred, the acts of the majority will bind the other trustees; but where they act ultra vires, then, the acts of the majority will not bind the minority, or the other trustees.
This is the sequel of the case reported ante vol. 4, p. 401.
It is there seen that this was an action raised by certain of the road trustees of the Edinburgh and Glasgow Road, by way of Bathgate and Airdrie, for advances made by them in the formation and prosecution of the road under the powers of an Act of Parliament, against their co-trustees.
The cause having thus returned to the Court of Session, the judgment of the House of Lords was applied, after remit by the Court, to the Lord Ordinary for that purpose. And his Lordship ordered the appellants to state, in a condescendence,
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After the condescendence was lodged, the Lord Ordinary ordered the case to be stated, in memorials, to be reported to the whole Court for their judgment.
The condescendence is specially referred to in the speech of Lord Eldon.
1. It appeared, 1st, As to Sir Alexander Livingstone, who was now represented by his son, Sir Thomas, that he had been present at several meetings of trustees, where committees were appointed to enter into contracts to complete the branch roads. At some of these meetings, committees were appointed to enter into contracts for making certain parts of the road, and for building bridges; that at others of the meetings, contracts already entered into were reported and approved of, and that Sir Alexander was one of those trustees who made some of these contracts, and who had subscribed them. He contended he had only bound himself as trustee. The Court found (13th November 1807) no acts condescended on, sufficient to make him personally liable. *
_________________ Footnote _________________
* Opinions of the judges:—
Lord Justice-Clerk (Hope) .—“Sir Alexander Livingstone was active as a trustee. But he had a right to be so in that character. He did not go out of, or beyond that character, or what it entitled him to do. His authorizing contracts was within that character. Suppose the movers in the business had laid down the whole £10,000 on the table, got on their own personal security, or any way, still the trustees had right, as such, to go on contracting on that footing. It would have been necessary to warn the trustees to take care not to exceed the £10,000, under pain of personal responsibility. Even if Sir Alexander Livingstone had contracted himself, it is not to be presumed that he meant to exceed the parliamentary fund. I doubt if he was even bound to the contractor beyond that fund, unless the contractor specially warned the trustees contracting with him, that he trusted them personally. The language of the contracts is quite that way. It states them in the character of trustees only, not as individuals; and it binds the subscribers and whole other trustees, not their heirs and successors. Now, how could they bind the other trustees beyond the parliamentary fund? The language of bonds is quite different. It binds them expressly both as trustees, and personally, and their heirs. The distinction at that time was meant, though it has since been overlooked. So I think Sir Alexander Livingstone
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2. John Hamilton Colt was called in the summons as liable for his father, Robert Colt, a trustee. Robert Colt had attended a single meeting of trustees. This meeting appointed a committee, which contracted for making a part of the road and some bridges, and it approved of a prior contract; but he had not signed any contract or bound himself personally in any instrument. The Court (12th November 1807) found no acts condescended on sufficient to make him personally liable.
3. Mr William Hamilton of West-Port, had attended meetings merely as a trustee having power to administer the Parliamentary fund. He was one of a quorum of five trustees who signed a submission or arbitration bond for ascertaining the damage done to lands occupied by the road. He also signed a contract as one of a quorum of three of a committee appointed by the trustees for constructing Torphichen Bridge, but in these, he only bound himself as a trustee. The Court found (13th November 1807) that no acts had been condescended on sufficient to make the said William Hamilton personally liable.
4. Mr More Nisbet was called as representing his father, a trustee. His father had attended one meeting of trustees, but it was contended he could incur no personal liability thereby. The Court found (13th November 1807) that no acts had been condescended on sufficient to make him personally liable.
5.
6. Mr Buchanan had attended three meetings of trustees
_________________ Footnote _________________ meant merely to give his personal trouble, and to leave it to the movers to find the money. I am, therefore, for assoilzeing.”
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Mar. 8, 1808.
The Court, on reclaiming petition, pronounced this further interlocutor as to all the cases:—
“Alter their interlocutors reclaimed against, in so far as to find that the deceased Sir Alexander Livingstone was personally liable, and that the said William Hamilton is also personally liable in payment of the sums demanded, and in relief to the pursuers for the expense of such contracts or deeds as they severally signed, but to no further extent; but, quoad ultra, adhere to said interlocutors, and refuse the prayer of the several petitions against these two defenders; and as to the whole of the other defenders (respondents) above named, the Lords adhere to these interlocutors reclaimed against, and refuse the prayer of the respective petitions; but supersede extract till the third sederunt day of May next.”
Against these interlocutors the present appeal was brought to the House of Lords, Mr Hamilton, and Sir Thomas Livingstone brought a cross appeal.
After hearing counsel,
“My Lords, †
In those cases with respect to the trustees of a road, I am to trouble your Lordships, with reference to some interlocutors, which are appealed from in the case of
Higgins v. Livingstone. My Lords, some years ago this cause came before us from the Court of Session, upon the appeal of Mr Higgins, who states himself to be assignee in trust of the Honourable Henry Erskine of Almondell, the Honourable Sir William Honyman of Armadale, Bart., one of the senators of the College of Justice; Alexander Majoribanks of Majoribanks; Matthew Sandilands of Couston; Thomas Sharp of Houston; Andrew Stirling, late of Drumpellier; William Sharp of Kirkton; the deceased Sir John Inglis of Cramond, Bart.; the deceased Colonel John Hamilton of Pencaitland, and the deceased William Waddell of Easter Moffat, trustees for making the road from the New Bridge over the water of Almond, on the confines of the counties of Edinburgh and Linlithgow, to Baillieston, in the
_________________ Footnote _________________ * The case of Sir William Augustus Cunynghame, was dealt with in the same way, as standing in
pari casu. _________________ Footnote _________________ ‡ From Mr Gurney's Short-hand Notes.
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My Lords, an Act of Parliament had passed, which had enabled various persons, to make a road in a part of Scotland, which I need not describe to your Lordships, and it appeared, I think, that the only fund which was provided by the original Act of Parliament for making this road, was a sum of £10,000, which the trustees were empowered to borrow on the tolls and duties, which they were authorized to levy on the road. Your Lordships will recollect, that the proceedings stated a great variety of transactions which had been had, by these trustees, at a meeting on the 2d of June 1792, another on the 14th of July 1792, another on the 27th of August 1792, another on the 6th of October 1792, another on the 10th of November 1792, another on the 28th of December 1792, and at various other periods; and one fact was extremely clear, that the expenses of the roads, and the undertakings which had been contracted for, very much exceeded this sum of £10,000, and those expenses were incurred long before the toll or duties could be collected; those duties could not be collected till the road was made and some parts opened. Certain of those trustees, having paid very large sums of money, after Parliament had, I think, in one or two instances, added to the amount of what they were entitled to raise under the first Act of Parliament; this proceeding was instituted in the Court of Session, for the purpose of having relief against the other trustees, and that was sought in a libel or declaration, which, after narrating the several Acts of Parliament, proceeded to state, that certain persons therein mentioned, trustees under those Acts, did, accordingly, convene for the purpose of putting the same in execution, and held their first meeting at Bathgate, in the month of June 1792, and thereat, and at sundry general and adjourned meetings held by them, the trustees did order and direct surveys and plans of the said roads and others to be made and reported to them; and after fixing upon what appeared to them to be the best line, and most calculated for the purpose of public utility, they appointed several of their number committees, with powers and for the purpose of contracting for the making and upholding particular districts of the said road, with the bridges thereon. That in virtue of the powers so committed to them, the said committees did enter into sundry contracts and agreements, for making and upholding the particular district roads allotted to them, with the bridges thereon, and various necessary particulars connected therewith, by which contracts and agreements so entered into, the said committees bound and obliged
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My Lords, the first judicial proceeding in this action was, that upon the 15th of November 1799. The Lord Ordinary, previous to the hearing, appointed the pursuer to give in special condescendences of the grounds upon which he meant to support his claims against the different defenders, together with copies of the obligatory clauses in the contracts for making and repairing the roads, and in the bonds for the money borrowed by them for that purpose. The different contracts, as some of your Lordships may remember, varied very much in their terms; some of them being contracts which bound the parties contracting, their heirs, executors, and successors; others being contracts which bound the parties describing themselves as trustees, and the first part of this interlocutor seems to have proceeded on this principle, that taking it to be true, in point of law, as it has very often happened in point of fact, that where there are parliamentary trustees, with a power to pledge the funds for carrying on the concern, with relation to which they become trustees; it is, nevertheless, competent for them to bind themselves as individuals; but the Lord Ordinary, thinking that the true principle of law might be, that those who had bound themselves personally, not merely in the character of trustees able to pledge the trust-fund, but that those who had bound themselves personally in aid of the fund, in case the fund was insufficient, or in such a manner, that the parties with whom they dealt, were under no obligation to look to the fund, but to the personal obligation of the party, although they might personally undertake, yet, if they thought proper to come into a Court of Justice to make others relieve them by contributing as if they were liable, it was on the pursuer to show that the other parties had contracted that liability which trustees may be said prima facie not to contract.
When this cause came before the whole Court, on the 12th of December 1799, the Lords found it proved by the minutes referred to, that the trustees assembled at meetings held under the Act of Parliament for making the roads in question, appointed committees of their number, with power to enter into contracts and agreements relative thereto, in consequence of which, and of the contracts and agreements thus entered into, a great expense was incurred, which made it necessary to borrow considerable sums of money upon the credit of the tolls, and upon the private credit of the pursuers; that the pursuers were entitled to a proportional relief, from the other trustees, called as defenders in this
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Feb. 18, 1800.
The defenders gave in a reclaiming petition against this judgment, which was appointed to be answered by the pursuers, and upon advising these, the Court pronounced this interlocutor:—
“The Lords having advised this petition with the answers thereto, and the minute this day given into Court, on the part of the petitioners, they refuse the desire of the petition, and adhere to their interlocutor reclaimed against.”
May 14, 1800.
The cause then went back to the Lord Ordinary, who made the following order:—
“Having considered the interlocutor of the Court of 12th December last, ordains each of the defenders to state, in a special condescendence, the particular circumstances, by which he alleges he does not fall under the findings of the interlocutor, and that against next calling.”
Thus the nature of this proceeding was entirely changed, because the Lord Ordinary was entirely of opinion, that it became the pursuers to state the circumstances, from which they inferred the defenders were liable, and that seemed the more reasonable course, because this was not a proceeding against all persons, who had been present at the meetings, but against a considerable number of them, who had not been present at the meetings. It will be in your Lordships' recollection, that this cause was remitted from this House to the Court of Session, and the interlocutor of the Court of Session has given the Lord Ordinary a different rule of procedure, calling on him to consider, that those who were present at the meetings, were to contribute a proportion of relief, to those who made the payments, unless they could show they were not liable, although present at the meetings.
When the case came to be discussed before us, as it appears by a paper I now have in my hands, your Lordships will recollect this House was attended by two noble and learned Lords now dead, who delivered their sentiments, and it was felt a matter of infinite importance, as well as difficulty, to say, that a man, who went into a room, where trustees were sitting, merely to inquire after the health of a person there, was to be taken to be liable, not only to the extent of any trust fund he had to administer, for all the purposes of which that meeting was ordained, but that if it happened, that the meeting should have allowed or homologated any contracts in the course of that meeting, while he was not present, and that if, in the execution of these, other matters arose out of them, he must be considered as personally liable to all the parties that dealt with the trustees, and would have to contribute
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There is a gentleman, one of these trustees, of the name of Russell, who, I think, had, in the course of all those proceedings, gone once into the room to ask a friend, who was there, after his health, and the clerk put down his name, just as your Lordships take notice of a Peer's attendance here, whether he votes or not; and there were other trustees, one particularly, who was a trustee merely in respect of an office he held in some burgh, and who held the office for the time being, and if this man, who, I believe, was a provost, had gone into the meeting, on the last day of the year, in which he was serving in his official character, if it was only to have a conversation with a friend he had not seen for years, the clerk would put down his name immediately, and this would render him liable to all the consequences I have before stated.
My Lords, upon the former occasion I do not recollect that the counsel at the bar were able, nor was I able, to furnish, nor am I now able to furnish any case which has occurred in this part of the Island, on such a subject, though I have made some inquiries, except a case which, in this paper I hold in my hand, which I see is a little misnamed, called Forster v. Bell, whereas the name is Horsley v. Bell, of which there is a printed note in Brown's Chancery Cases, 101, and of which I have a note furnished me by the learned gentleman now at your Lordships' table, in which Lord Bathurst, with Mr Justice Ashurst and Mr Justice Gould, held “that a bill might be filed by a person who was the undertaker of a Navigation Association at Thirsk, in Yorkshire, against the commissioners named in the Act of Parliament for carrying it on, who had signed the several orders.” Your Lordships will permit me to beg your attention to that circumstance, that they had signed the several orders. Three questions were agitated at the bar. The first question was, whether the defendants were personally liable; the defendants contending that they were exercising a public trust, and that the credit was given to the under taking itself, not personally to them, that the remedy was, therefore in rem. Secondly, Whether all who had been present at any of the meetings, and had signed some, but not all the orders, were liable as to all the orders, or only as to those which they had respectively signed, or his remedy was merely at common law? With respect to the third question, the learned judges who advised, the Chancellor and the Vice-Chancellor who was advised by those learned judges, disposed of that, by saying, it was much more convenient to come into equity, than to go to common law.
My Lords, on the authority of one of the learned lords now dead, I think I am justified in saying, that this case is not very
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When this matter came to be discussed before this House, on the former occasion, the House was of opinion—it must have been of that opinion, or I cannot see any reason for which we sent the matter back to the Court of Session—that the mere presence at these meetings was not enough to subject the party to this contribution; or what I take, for the purpose of this cause, to be the same thing, the payment of the tradesmen who had made assignation of their debts: for the fact that there had been minutes of all these meetings, and that the minutes of all these meetings exhibited the names of all these persons, as having been present, as
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For the reasons which were then very much detailed, which I shall not trouble your Lordships with now, this House ordered, “That the cause be remitted back to the Court of Session in Scotland, to review the interlocutors complained of, of the 12th December 1799, and the 18th of February 1800, generally, and to find from which of the defenders, and in respect of what particular sums as to each of them, the pursuers, and which of them are entitled to proportional relief, and by reason of what acts each such defender became personally liable, and in what sums the defenders are respectively personally liable to contribute to such relief,” and the interlocutor of the Lord Ordinary was necessarily reversed.
Nov. 1792.
Your Lordships will recollect this remit was made by this House, perfectly cognizant of the effect and contents of all these minutes; and if this House meant to say, that because A was at this meeting, and B was at this meeting, and C was at this meeting, or were at the meeting at some particular period during which it was held, therefore the presence of A B and C at such meeting, was sufficient to fix those defenders with this demand of contribution, the House acting reasonably, ought to have said so at the time, and not to have sent it back, merely to state to the Court of Session again, that of which this House was perfectly cognizant,
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My Lords, my Lord Polkemmet was present, I think, at two meetings; he was present at the meeting on the 28th of December 1792; and was one of the thirty trustees who, upon considering the report of the committee appointed to consider of two lines of road, which had been proposed, approved of one of those two lines, and appointed a committee of ten trustees, to carry it into execution, three of whom were to constitute a quorum; and he is likewise stated to have been present at another meeting; and then looking at the number of trustees who were present at those other meetings, and the sums that were expended in consequence of those meetings, they assign to him his proportion of the expenses.
There is a paper, and a very able paper, printed on the part
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Sir William Augustus Cunynghame was present at two meetings. Mr Buchanan was present at three meetings, and there is a letter of his, which seems to import a notion in his mind, that he was not only bound, but that it was reasonable he should make some contribution; he says, it was represented to him as the opinion of counsel, that he was liable, but on better consideration of the subject, he states, he is not liable, and I think I may venture to state, that the general ground on which, with the exception of one defender of the name of Hamilton, and Sir Alexander Livingstone, they are sought to be charged as liable, is, the circumstance of their presence at these meetings. One of them is a very remarkable case—Mr Nisbett's ancestor was present on the 5th of October 1793, and by reason of that presence on the 5th of October 1793, he is sought to be charged with the effect not only of the contracts that were then entered into, but with all the proceedings that meeting had homologated.
My Lords, the question here is this, whether it is possible for your Lordships to say, that, considering what was the meaning of your own remit, the Court of Session, in the interlocutor I am now about to state, have miscarried. My Lords, it is one way of treating this case to say, I will, after such a remit, content myself with a condescendence which states little more than that the parties had attended these meetings, and another to allege, by way of condescendence, not only that the parties were at those meetings, but that, de facto, A took such a part, B signed such a contract, and C transacted such and such business with his brother trustees, with a view to state not that there was a mere presence and liability as resulting from it, of which your Lordships, by the remit, appeared to me to have considerable doubts. It was not thought sufficient to charge the trustees against whom nothing more could be alleged than that they were present at meetings. But your Lordships meant by the remit to proceed, thus:—Sir Alexander Livingstone was there, he did such and such acts, he was a party to such a measure, and so going through the defenders respectively, this would have met the idea, your Lordships entertained at the time of the remit; but I conceive your Lordships could not have meant to send it back, to say, that the mere presence
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My Lords, after this remit, the first judgment, the Court of Session gave, was this:—
“On report of Lord Craig, and having advised a memorial for the pursuers, with the counter-memorial for Sir Thomas Livingstone and for Archibald Ferrier, Writer to the Signet, common agent, appointed for carrying on the process of ranking of the creditors of the deceased Sir Alexander Livingstone, and the whole former proceedings, together with the remit from the House of Lords, the Lords find that no acts have been condescended upon sufficient to have rendered the deceased Sir Alexander Livingstone the predecessor of Sir Thomas Livingstone, personally liable in payment of the sums demanded, or in relief to the pursuer: Therefore, recall their interlocutors of the 12th December 1799, and 18th February 1800, appealed from”
(these are the interlocutors that had been remitted), “sustain the defences, assoilzie the said Sir Thomas Livingstone from the passive title as legally charged to enter heir, in respect of the renunciation now produced in process: And farther, in respect of its being found that Sir Alexander was not personally liable, find that the pursuer is not entitled to have any decreet, cognitionis causa, pronounced in his favour: As also assoilzie the said Archibald Ferrier as common agent aforesaid, from the conclusions of the action, and decern: Find no expenses due, and appoint the condescendences, answers, replies, and duplies given in before the Lord Ordinary, to be withdrawn, and to make no part of the proceedings in the cause.”
My Lords, a similar interlocutor was pronounced by the Court in each and every of the cases of these defenders: Against these several interlocutors so pronounced, petitions were presented complaining of them, and particularly one complaining of the interlocutor as applicable to the case of Sir Thomas Livingstone, one of the defenders in this petition, and “upon advising these petitions, with answers thereto for Sir Thomas Livingstone, and the common agent in the ranking of Sir Alexander Livingstone, his father's creditors, and having also resumed consideration of the several petitions for the pursuer, against Sir William Augustus Cunningham, the Hon. William Baillie of Polkemmet, John Hamilton Colt, William Hamilton, Andrew Buchanan, and George More Nisbett, Esqs., defenders, the Court alter their interlocutors reclaimed against, in so far as to find that the deceased Sir Alexander Livingstone was personally liable, and that the said William Hamilton was also personally liable in payment of the sums demanded, and in
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Now, it appears to me, that if they have proceeded upon this principle, that if you condescend and prove nothing more against the defenders, than merely showing by the minutes of the clerk of the meeting, that at some period of that meeting A B came in where the meeting was held, that is not enough to charge him as personally liable, but if, on the other hand, individuals make themselves parties to contracts and deeds, which, in terms, pledge them to personal responsibility, or which ought to be considered as making them personally liable, because if there was a fund, that fund ought to be produced by them, and if there was no fund, they must be taken to have acted with the persons with whom they contracted, as if there was a fund, that they were to apply to the purposes of the contract; I say, if they proceeded on these principles, that accounts for what has been thought unaccountable; for the distinction which Judges below make between the case of Sir Alexander Livingstone and William Hamilton, and those other pursuers and defenders, and the personal liability of these two must be taken in my view of this case to arise, not from the circumstance of their having been present at the meetings, but because their personal liability is founded on the deeds and contracts which they executed, and which deeds and contracts are themselves evidence, that they did concur in those objects of the meeting with reference to which it had been stated the other defenders were not personally liable. I can find nothing with respect to the other defenders, except the mere fact, that they went to the meeting, which mere fact appears to be a fact that was considered by your Lordships' former judgment, as not of itself sufficient to charge them personally. In the instance of Mr Russell, if that was his name, which I think it was, who went into the room to ask a friend how he did, because the clerk put him down, he cannot be considered liable to any contracts then entered into. The circumstance of a man going in once in a year to see an acquaintance, the mere evidence of these minutes, that he was there, and without any evidence that he did any thing else, cannot make him liable; if he had gone to a subsequent meeting, and had homologated or approved of the contracts made at former meetings, that
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My Lords, the difficulty I have really is this, Whether you should now conclude the case, or remit it back to the Court of Session? Because I believe it was the intention of those noble and learned Lords to whom I have alluded, that this condescendence should be of a very different nature from what it is; that it should specify the acts and deeds in addition to the mere presence at meetings, out of which this right of contribution is claimed. No such thing has been done, and I do not think you can send this back from time to time, and from year to year, to give a second, a third, and a fourth opportunity of considering the case in condescendences. I hope you may be advised to affirm the several interlocutors according to the terms which I have stated, and there are several petitions, which must be noted specially in the terms of the order.”
Accordingly, it was ordered and adjudged that the original and cross appeal be dismissed, and that the interlocutors be, and the same are hereby affirmed.
Counsel: For the Appellants,
Sir Saml. Romilly,
Henry Erskine.
For the Respondents,
Wm. Adam,
Robt. Forsyth.