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You are here: BAILII >> Databases >> United Kingdom House of Lords Decisions >> Earl of Breadalbane and Holland v. Claud Russell, (Campbell's Trustee) [1825] UKHL 1_WS_620 (28 June 1825)
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SCOTTISH_HoL_JURY_COURT
Page: 620↓
(1825) 1 W&S 620
CASES DECIDED IN THE HOUSE OF LORDS, ON APPEAL FROM THE COURTS OF SCOTLAND, 1825.
2 d Division.
No. 54.
v.
Subject_Assignation in Security — Lease. —
Two parties being joint tenants of certain quarries, and sole partners of a company for working them; and one of them having become the landlord, and advanced a sum of money for the other, who, in security, granted an assignation of his share in the concern; and there being no publication of this deed, or express intimation to the manager of the quarries, till within sixty days of the granter's bankruptcy; and the Court of Session having found, in a question with his creditors, that the assignee had acquired no preference;—The House of Lords remitted to take the opinions of all the Judges.
Page: 621↓
In 1748 the late Earl of Breadalbane, proprietor of the lands and barony of Nether Lorn, and of the island of Easdale, in Argyllshire, granted two leases, one of the marble and slate rocks of the whole estate, and the other of Easdale, in favour of certain persons, who had formed themselves into a company under the name of the Easdale Slate Company, for a period which, by a subsequent prorogation, extended to 1841. Among other partners were Colin Campbell of Carwhin, the father of the appellant, and John Campbell, father of John Campbell, writer to the signet, the constituent of the respondent Mr Russell. Their fathers, in 1754, became the sole partners and tenants, and on their deaths were succeeded by their respective sons. In 1782 the appellant, on the death of his cousin the late Earl, succeeded to the honours and estate of Breadalbane, and thereby became proprietor of the quarries. His copartner, Mr Campbell, resided in Edinburgh, where he practised as a law-agent and conveyancer, acted as factor and cashier for his Lordship, received the bills and proceeds of the quarries, kept the books, and accounted to the Earl for his share; while the active operations were carried on at the quarries by means of a manager or overseer. In March 1813 Mr Campbell obtained for his accommodation two bills accepted by the appellant, one for L. 5000, and the other L. 1000, payable twelve months after date, for which Mr Campbell granted a letter of relief; and in June thereafter he executed an ex facie absolute assignation of his share of the Easdale quarries in favour of the appellant, under the exception of a previous assignation granted to his wife in security of her jointure in the event of her surviving him. On the other hand, the appellant granted to Mr Campbell a back-bond, declaring that he held the assignation for his own relief; and thereupon it was deposited in his charter-room at Taymouth. No intimation, however, was made of this assignation to the manager, nor did any change in possession at this time take place. On the contrary, it appeared from the books that the accounts were kept in the same form as they had been prior to the assignation,—the one-half of the profits being allotted to the appellant, and the other to Mr Campbell. The accounts so kept were docqueted by the parties on the 21st February 1816. After several renewals the appellant was obliged to retire the bill for L. 5000 to the extent of L. 2000. In 1816 he went to the Continent, and did not return till April 1818, when, finding that there was a balance of rents of L. 10,000 in Mr Campbell's hands, he required him to apply it in a particular way, but was informed by
Page: 622↓
From the state of Mr Campbell's affairs the appellant found it necessary to employ another agent, who, on the 26th of June, caused a notorial protest and intimation to be served on the manager, by which the procurator for the appellant intimated to him the assignation, “and required him to enter the said intimation in the books of the Company, by a minute to the effect foresaid, and required that he, the said Alexander Campbell, should deliver to him a certified copy of said entry or minute, and give effect to the said deed by immediate possession, and by paying over to Duncan Campbell, Esq. factor for the said Earl in Argyllshire, all such sum or sums of money, bills, or securities, as were then in his the said Alexander Campbell's
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“I, Alexander Campbell, manager of the Marble and Slate Company of Nether Lorn, do hereby certify, that upon the 26th day of June last, the foregoing conveyance was intimated to me, in name of the Earl of Breadalbane, conform to a schedule delivered to me of that date, and engrossed in the books of the said Company; and further, I certify, that the said conveyance was again intimated to me this day by Duncan Campbell, Esq. his Lordship's factor in Argyllshire; and in consequence of these several intimations possession was respectively given to his Lordship, by delivery to his said factor of bills due to the Company, for purchases of slates sold by me on their account,” &c.
On the 11th August Mr Campbell executed a trust-deed in favour of Mr Claud Russell for behoof of his creditors, and on the 21st he was rendered legally bankrupt, being within sixty days from the first notorial intimation. An action of reduction and declarator, founding on the statutes 1621 and 1696, and 54. Geo. III. c. 137. of the assignation in favour of the appellant, was then brought by Mr Russell, upon these grounds:—First, That the creditors for whose behoof the action was raised, were, at the date of the deed of conveyance, lawful creditors of Mr Campbell,—that the conveyance was granted to the appellant, without any just cause or adequate price,—that it remained latent in defraud of the creditors,—and that the conveyance, therefore, was null and void, in terms of the Act 1621, c. 8. Secondly, That the conveyance was intended as a security of a former debt, granted by a person insolvent, with the view of giving a preference to the appellant over the other creditors,—that the granter of the deed was rendered legally bankrupt upon the 21st of August 1818, within sixty days of the intimation or delivery,—and that the conveyance, therefore, was null and void, in terms of the Act 1696, and also by the provisions of the later bankrupt statutes. And, thirdly, That the conveyance was granted in trust, or in security of a limited sum, inadequate to the real value of the subject conveyed, and, therefore, that it could in no respect be made available to any greater extent than the sum really paid.
In defence the appellant pleaded, that the delivery of the deed to him was sufficient to complete his right; and that, at all events, that supposing intimation or possession were requisite, this had
Page: 624↓
“The Lord Ordinary having considered the mutual memorials for the parties in the case, and whole process, in respect the granter of the conveyance or assignation of the 23d of June 1813 was allowed to continue in possession of the subject conveyed, and that no intimation of the assignation was made till within sixty days of his bankruptcy, finds, that the assignation was not completed, to the effect of giving a preference to the assignee in a question with the creditors of the cedent; sustains the reasons of reduction, and reduces, decerns, and declares in terms of the libel.”
To which interlocutor his Lordship afterwards adhered upon advising a representation, with answers. The appellant having reclaimed, the Court, on the 3d December 1822, by a majority, “adhered to the interlocutor of the Lord Ordinary complained of, in so far as it finds, that, in respect the granter of the conveyance or assignation challenged was allowed to continue in possession of the subject conveyed, and that no intimation of the assignation was made till within sixty days of his bankruptcy, the assignation was not completed, to the effect of giving a preference to the assignee in a question with the creditors of the cedent; but, before answer, remitted to his Lordship to hear parties further on the conclusions of the libel, and do as he shall see cause.” *
The Earl then appealed.
Appellant.—It is necessary to attend to the relative situation in which the parties stood. The appellant was the landlord, and the Company the tenant. He and Mr Campbell were also joint tenants, and they were likewise the sole members of the partnership. The assignation, therefore, when delivered to the appellant, was complete in every respect as a conveyance of Mr Campbell's right as tenant; because it was a deed of transfer executed several years prior to his bankruptcy, and consequently effectual to divest him; and the delivery to the appellant as landlord was the only and the best intimation that could be made. Again, it was effectual as a transfer of Mr Campbell's share as a partner in the Company; and as he and the appellant were the only partners, and it was executed by the one and delivered to the
_________________ Footnote _________________ * 2. Shaw and Dunlop, No. 62.
Page: 625↓
Respondent.—The assignation remained latent till the first notorial intimation was made, and in that document it was admitted, that no previous possession had taken place, or intimation been given. Accordingly it appears from the books, that no alteration was made on the right of parties, and that Mr Campbell drew his share of profits as if no conveyance had been executed by him. In a question with creditors, therefore, the assignation must be considered as latent, and consequently incapable of conferring a preference. It is declared by the Bankrupt Statute, that until intimation shall be made, or possession taken, no assignation shall be effectual against them. It is impossible to regard the correspondence with the manager as productive of a change of possession.
The House of Lords ordered, “that the cause be remitted back to the Court of Session, to review generally the interlocutors complained of; and, in reviewing the same, the Court is especially to consider how and to whom intimation of the assignation ought to have been given: And it is further ordered, that the Court to which this remit is made, do require the opinion of the Judges of the other Division in the matters and questions of law in this case, in writing, which Judges of the other Division are so to give and communicate the same; and after so reviewing the interlocutors complained of, the said Court do and decern in this cause as may be just.” *
_________________ Footnote _________________ * See 5. Shaw and Dunlop, No. 433. for the result of the remit.
Page: 626↓
My Lords,—The present appellant, and Mr John Campbell, writer to the signet, succeeded to these leases, as the heirs of the two original tacksmen, their fathers, and became the sole partners of the Company, which was called the Easdale Slate Company. In the year 1780, the appellant, Lord Breadalbane, succeeded to the title and estates of his cousin, the late Earl of Breadalbane, and thus became proprietor of the farms and quarries possessed by the Easdale Slate Company as tenants; so that he united in himself, at the same time, the character of proprietor of the lands and quarries, and he was joint tacksman with Mr John Campbell in this lease. The superintendence of this concern devolved upon Mr Campbell, writer to the signet, who was for many years employed in the general management of Lord Breadalbane's affairs. There was, indeed, an overseer resident at Easdale to take charge of the works, but he was a mere servant of the Company, the management of the concern being conducted solely by Mr Campbell. It appears, that the custom was for the overseer to draw bills on the purchasers of the slates, which were made payable to Mr Campbell, at his office in Edinburgh, to whom they were sent, in the first instance, for the purpose of getting them accepted, and when due to get them paid. Mr Campbell was also occasionally in the habit of visiting the quarries, of giving directions for their management, and of annually settling the overseer's accounts; and, in his general account with the appellant, he gave him credit for the one-half of the profits.
Matters continued upon this footing until the month of March 1813, when Mr Campbell, who, it appears, was engaged in a variety of other concerns, wanting money, applied to the Earl of Breadalbane to join him in security for a loan of money, which he represented as a matter of the utmost consequence to him at that period. The security he proposed to give him for his relief, was an assignment of his share in those tacks, and in the stock of the Easdale Company. The Earl of Breadalbane, to oblige Mr Campbell, acceded to this request, and accepted two bills, one for L. 5000, and the other for L. 1000, drawn by Mr Campbell, at twelve months' date. Mr Campbell granted a letter of relief in the mean time; and for completing the proposed security, the following deeds were executed:—Of the date of the 23d June 1813, Mr Campbell, on the narrative of certain good causes and considerations, granted an absolute and unqualified conveyance, in the appellant's favour, of his interest in the Easdale quarries, being one-half; but under the exception of a previous assignation which he had granted to his wife, in her contract of marriage, in security of her jointure of L. 400 a-year, in the event of her surviving him.
Upon obtaining that conveyance, Lord Breadalbane executed a
Page: 627↓
This conveyance by Mr Campbell was delivered to the appellant, Lord Breadalbane, immediately after it was executed, and was by him deposited among his other papers in the charter-room at Taymouth. Mr Campbell appears to have had the management of this concern for several years afterwards. The bill for L. 1000, which had been discounted at the Royal Bank, was taken up by Mr Campbell; but the other bill for L.5000 was renewed by bills of subsequent dates, accepted by Lord Breadalbane; and the debt was at last paid by Lord Breadalbane to the Bank.
My Lord Breadalbane, it is stated, went to the Continent in 1816, and did not return till 1818. Upon that occasion, being aware of a considerable sum of his rents being in Mr Campbell's hands, he wrote to Mr Campbell to desire he would furnish him with a state of his accounts, and employ the balance, which amounted, as my Lord Breadalbane states, to upwards of L.10,000, in paying the balance of the price of an estate which my Lord Breadalbane had recently purchased. On that occasion, as it turned out, Mr Campbell was obliged to explain the state of his affairs, and to acknowledge that it was altogether out of his power to make this payment. Upon that coming to Lord
Page: 628↓
“ Dear Sir, I notice, by your letter of the 12th instant, that all the bills for the sales at Easdale for the year ending Martinmas 1817 are transmitted. In making out the bills for the ensuing year, you will attend, in consequence of arrangements, they are now to be drawn payable to your order, at the Royal Bank, Edinburgh, and that they be blank indorsed by you.”
It is stated, that, in order that the appellant might see that his instructions with regard to the appropriation of these remittances had been duly obeyed, Mr John Archibald Campbell transmitted a copy of the above letter to him in London, writing, at the same time, as follows:—
“I have the honour of enclosing a letter from my father to the manager at Easdale, which went this night, and will of course put all matters right. The bills were formerly payable to my father, after being accepted by the purchasers. As they come up, they will be lodged in the Royal Bank, who will draw the proceeds, and retain them, until further orders.”
My Lords,—It appears that my Lord Breadalbane thought that the change which had been thus directed, with respect to the mode of drawing the bills, might not be sufficiently effectual, and that it was necessary to go a step farther; and he ordered that the bills should be made payable directly to himself. For this purpose, upon the 6th of June 1818, Mr Duncan Campbell, who was the appellant's factor in Argyllshire, called upon the overseer at Easdale, and required him for the future to make the bills payable to him.
This is noticed in a letter from the overseer to Mr John Campbell, dated the 6th of June, in which he says,—
“Lord Breadalbane's factor called here this morning, and intimated his Lordship's wishes, that the bills were to be drawn in future payable to his Lordship's factor: to this I answered, that I would write you on this subject. You will please, therefore, send me the exact form you wish, and the kind of indorsation, to prevent any inaccuracy hereafter, as I find myself at a loss how to act, until I hear particularly on the subject.”
This letter was answered by Mr John Archibald Campbell, the son of Mr John Campbell, in a letter of the 18th of June, in which he says, “My father will himself write you about Easdale; in the mean time I beg to mention to you, that the bills are all to be payable and drawn in favour of Mr Duncan Campbell.” The matter was thus settled, and the manager acted upon this order, from that time forward, in making his remittances.
Page: 629↓
My Lords,—After the above intimation had been given to the overseer at Easdale, with regard to the mode in which the remittances were for the future to be regulated, Lord Breadalbane found it necessary, in consequence of the state of Mr Campbell's affairs, to employ another man of business; and having selected Mr Harry Davidson, writer to the signet in Edinburgh, for this purpose, that gentleman, immediately upon his appointment,—a stranger, it is stated, entirely to the Earl of Breadalbane's affairs—unacquainted with the precise nature of the conveyance, which remained in the depositaries at Taymouth, to which he had not at that time access—and ignorant of the previous intimation which had been made to the manager of Easdale,—directed his son to proceed to that place, and make such intimation as he could, to any clerk or manager of the Company whom he might find upon the spot, of the conveyance which had been executed in favour of the appellant in 1813.
My Lords,—Shortly after this Mr Campbell was made a bankrupt, namely, on the 21st August, within sixty days after this intimation which had been given by Mr Harry Davidson, so that no legal effect could be attached to that intimation. On the 11th of August 1818 Mr Campbell executed a trust-deed of his whole estate, real and personal, in favour of Mr Claud Russell, accountant in Edinburgh, the respondent in this cause. This deed was afterwards intimated to Lord Breadalbane, but he never acceded to the trust.
My Lords,—An action of reduction and declarator was afterwards brought before the Court of Session, at the instance of the trustee Mr Russell, and also certain creditors of Mr Campbell, against Lord Breadalbane, concluding for reduction of the conveyance of his share of the stock of the Easdale concern, and the instrument of the intimation and possession which had been taken on the 26th of June, upon three grounds:—First, That the creditors for whose behoof the action was raised were, at the date of the deed of conveyance, lawful creditors of Mr Campbell,—that the conveyance was granted to the appellant, without any just cause or adequate price,—that it remained latent, in defraud of the pursuers, and that the conveyance therefore was null and void, in terms of the Act of 1621, chap. 8. Secondly, That the conveyance was intended as a security of a former debt, granted by a person insolvent, with a view of giving a preference to the appellant over the other creditors,—that the granter of the deeds was rendered legally bankrupt upon the 21st of August 1818, within sixty days of the intimation or delivery,—and that the conveyance therefore was null and void, in terms of the Act of 1696, and also by the provisions of the later bankrupt statutes. Thirdly, That the conveyance was granted as a trust, or in security of a limited sum, inadequate to the real value of the subject conveyed, and, therefore, that it could in no respect be made available to any greater extent than the sum really paid.
This case was remitted to Lord Pitmilly, and his Lordship granted
Page: 630↓
“The Lord Ordinary having considered the mutual memorials for the parties in the case, and whole process, in respect the granter of the conveyance or assignation of the 23d of June 1813 was allowed to continue in possession of the subject conveyed, and that no intimation of the assignation was made till within sixty days of his bankruptcy, finds, that the assignation was not completed to the effect of giving a preference to the assignee in a question with the creditors of the cedent; sustains the reasons of reduction, and reduces, decerns, and declares in terms of the libel.”
To that interlocutor his Lordship afterwards adhered, upon advising a representation, with answers.
My Lords,—Upon this the appellant presented a petition to the Second Division against the Lord Ordinary's judgment; and the Second Division pronounced this interlocutor:—
“The Lords having advised this petition, with answers, thereto, adhere to the interlocutor of the Lord Ordinary complained of, in so far as it finds, that, in respect the granter of the conveyance or assignation challenged was allowed to continue in possession of the subject conveyed, and that no intimation of the assignation was made till within sixty days of his bankruptcy, the assignation was not completed to the effect of giving a preference to the assignee in a question with the creditors of the cedent; but, before answer, remit to his Lordship to hear parties further on the conclusions of the libel, and do as he shall see cause.”
My Lords,—Against this interlocutor an appeal has been brought to your Lordships' House; and a question, which, as it seems to me, is of as great importance as any question which has been discussed at your Lordships' Bar during this session, has arisen, namely, to what extent, and in what manner, an intimation was necessary, in this case, of this deed of assignation executed by Mr Campbell. My Lords, I say it is a most important question, because it undoubtedly affects the rights of persons in possession under tacks, seeking to raise money on the security of that interest which they may have in these tacks, and particularly as to the mode in which they can be permitted so to obtain money; it being stated, and stated from books of high authority in the law of Scotland upon this subject, that the general law was, that intimation was necessary in an assignation.
My Lords,—The general doctrine upon this subject is thus laid down by Mr Erskine. He says,— “A tack must also be accompanied by possession, in order to secure the tenant against the singular successors of the granter; for though leases, in the form in which they have been executed for several centuries past, admit not of symbolical possession by sasine, yet natural possession is required for giving the effect of a real right; and hence a posterior lease, followed by
Page: 631↓
Then he goes on:—
“Possession is as necessary for securing the transmission of a tack or sub-tack to an assignee or sub-tacksman, as for securing the tack itself to the original tacksman; or, at least, there must be some publication by which the conveyance must be made known, that so third parties may not be ensnared by latent or private conveyances, and because the adjudication of a lease is a public and judicial act of the Supreme Court transferring the right to the adjudger. A creditor adjudging that right from the tacksman, before the tacksman's voluntary assignee has obtained possession upon his conveyance, is preferable to the assignee.”
Then my Lord Stair also says,—“Possession is requisite not only to the conveyance of the property of moveable goods, but also of liferent rights, tacks, and rentals, servitudes, pledges, &c.; which tacks, though they be truly personal rights of location, and constitute only as real rights by the statute, yet intimation will not transmit them; but there is a necessity of possession.”
My Lord Kilkerran was also cited, who lays it down, that “the transmission of the property of moveables is completed by delivery; of lands, by infeftment; of nomina, by intimation; of tacks and other rights which require no infeftment, by possession; and, therefore, between two tacks, or between two sub-tacks, it is the first possession that determines the preference.”
My Lords,—It is admitted in this case, that, by the law of Scotland, there is no public intimation required in any particular form, or in any particular manner, to give validity to an assignation like that which has been made in this case; and it was stated that a case had been decided by the First Division of the Court, Yeoman v. Elliot and Foster, 2d February 1813, on this subject; and the short-note of that case at the head of the report is,—“A right to a lease by assignation is completed by entry of the assignee's name as tenant in the landlord's rental-book.”
My Lords, in that case, two persons of the name of Wilson and Main were manufacturers in Langholm; each of them held long leases of houses and building areas in that village, from the Duke of Buccleugh. Those leases they assigned in May 1810 to Mr Elliot in trust, for Messrs Elliot and Foster, bankers in Carlisle, in security of advances in money to be made to them, for the purpose of carrying on their trade. Upon receiving this assignation, Mr Elliot had his name enrolled in the Duke of Buccleugh's rental-books, and granted sub-tacks to Main and Wilson, who thereby remained in possession of their respective subjects; so that your Lordships perceive the intimation in this case was by Mr Elliot's procuring his name to be enrolled in the Duke of Buccleugh's rental-books, the
Page: 632↓
My Lords,—Against that interlocutor there was a representation, upon which occasion the Lord Ordinary adhered to his interlocutor: it was finally brought under the review of the Court of Session. On advising the case, I would just state to your Lordships, the argument against this interlocutor was, that the assignation to Elliot was never made effectual, as no possession or publication had followed upon it; and it could not, therefore, be preferred to the rights of the other creditors under the sequestration. Your Lordships perceive, that in that case there was no change of possession; the tenants continued in the possession, the assignee granted them sub-tacks; so that there was no alteration whatever of possession; and the only intimation was their intimating to the Duke of Buccleugh the fact, that they had become tenants by virtue of this. It was argued, that the want of possession could not be supplied by intimation to the landlord, nor by enrolment of the assignees in his rental-books, as the transfer of the property was not thereby made public; and the other creditors had been induced to transact with the bankrupts, from seeing them still in possession of the subjects in question.
My Lords,—That reasoning was answered by the other side; and the Court, in pronouncing judgment, said that which I am about to read to your Lordships. “To adopt the argument on this petition, would be to overthrow the credit of the whole tenantry in the country. A lease is merely a personal right, the parties to which are the landlord and the tenant: this right is transferable, like all other personal rights, by assignation, and the transference is completed by intimation to the only other person concerned, the landlord. How that intimation is made, is of no consequence, if it be acknowledged that it was made: the assignation may be secret, known only to the
Page: 633↓
My Lords,—Under the authority of that case, it was argued by the appellant in this, that, as far as it was a decision, it decided, that all the intimation necessary of the assignation of a tack, was an intimation by the assignee to the proprietor of the land, that he had become possessed of an interest in the tack; that, in this case, the party, who was a tenant and tacksman, having assigned it to the landlord himself, the proprietor, the very assignation amounted to that intimation which was held sufficient in the case to which I have referred your Lordships. With respect to the notification, it was contended that it was not sufficient, but that a notification should have been given to the overseer of the work that there had been this change: but it was said, that giving notice to him was only giving notice to themselves; that he was their mere agent to conduct the business there; that he was removable at pleasure; that any other overseer might be appointed; and it was therefore too much to say, that intimation was to be given to that overseer. But it was argued, that some public notification was necessary: I do not find that advertisement in the Gazette, or in any public paper, has been required.
It is then said there was no change in possession. My Lords, there was no change of possession in the case to which I have referred; but all that had taken place, namely, that letter of the 18th of June, more than sixty days prior to the bankruptcy, and by which a very material change took place as to the mode in which the business was to be conducted. The bills were to be drawn in favour of Lord Breadalbane, and not of Mr Campbell. It was argued, that this notice should have appeared in the books. My Lords, the books are not accessible to the public; the books were not accessible to the creditors of Mr Campbell; and, therefore, it does not appear to me how that could have any effect.
My Lords,—The principles applying to this decision appear to me to be in direct opposition to the case to which I have referred your Lordships. In that case, all which was done was intimation or notification to the factor, he being a party to the transaction: and, with respect to change of possession, it was not part of the transaction that there should be a change of possession, for it was merely to be a security.
My Lords,—Another case has been argued at your Lordships' Bar this session, but which stood over on an objection which arose in the course of the discussion of that case, in which a similar question has been raised—the case of the
Glasgow Bank v. Brock,
* in which the
_________________ Footnote _________________ * See Vol. III. p. 75.
Page: 634↓
My Lords,—Considering the very great importance of this case, for I do conceive it is of very great importance, as it affects the rights of parties in Scotland; and seeing the different decisions, which I think are not to be reconciled, that of the First Division, and that in this case; and, as I stated to your Lordships, the question so materially affecting the rights of parties,—I must confess, that in this case I should be extremely sorry to call upon your Lordships now for a decision. My humble recommendation to your Lordships would be, to remit this case for the further consideration of the Second Division of the Court of Session, intimating, perhaps, in that remit, a wish on your Lordships' part, that, in reconsidering this case, they should consider particularly how and in what manner intimation ought to have been given in this case; because they have not pointed put in what manner intimation ought to have been given; and I think it is highly desirable, that upon that, and upon the other points of this case, we should have the benefit also of the opinion of the First Division of the Court of Session.
My Lords,—If the other case had been fully heard before your Lordships, I probably should have recommended your Lordships rather to make a remit in that case than in this, because I think the point is more nearly brought out in that case than in this; but, at the same time, I think the particular point is sufficiently raised in this case. The Court of Session have not proceeded in this case on any ground of fraud,—I do not mean in the common acceptation of the word,—but legal fraud between Lord Breadalbane and Mr Campbell. They do not reduce on any such ground, but their general finding is, “that in respect the granter of the conveyance or assignation challenged was allowed to continue in possession of the subject conveyed, and that no intimation of the assignation was made till within sixty days of his bankruptcy, the assignation was not completed to the effect of giving a preference to the assignee in a question with the creditors of the cedent.” Their decision, therefore, is founded on these distinct propositions,—propositions which, as I have said, are most important to the rights of parties holding as these parties do; affecting, in the first place, I admit, that which the law of Scotland is very jealous of, secret assignations without any public or formal notification of them, so that the world may be apprized how they stand; but affecting also rights of tenants under tacks; because, if this decision be, as it may ultimately turn out to be, a right decision, it will follow, I think, to be extremely difficult for a tenant in possession of a large farm, whose only means of raising money to carry on that farm may be by assigning his interest to another, to obtain that assistance which he requires,
Page: 635↓
My Lords,—However much I regret that there should be farther delay in settling the rights of these parties, yet, after a great deal of anxiety on this subject, really the result of my impression has been, that the proper course will be to remit the case in the way I have stated, that we may have the benefit, if it comes here again, of the opinion of all the learned Judges in Scotland on this most important subject. For these reasons, therefore, I should humbly propose to your Lordships, neither to affirm nor reverse at the present moment, but to remit this case for the further consideration of the Court of Session, requesting their decision upon the point which I have stated to your Lordships, how and in what manner intimation, in their judgment, ought to have been given in this case, in order to secure the right of Lord Breadalbane under this assignation; and I should propose to your Lordships, that the Second Division be requested to take the opinion of the First Division of the Court of Session, so that we may have the advantage of the opinion of all those very learned persons on this question. It will be to me personally, and I have no doubt will be also to every one of your Lordships, a great satisfaction to have the advantage of their opinion, before your Lordships are called upon to settle finally what shall be the law in these cases in future. In order that I may present to your Lordships a minute in the proper form, I would move your Lordships that this case shall stand for further consideration on Tuesday next.
Appellant's Authorities.—3. Stair, 1. 9.; 3. Ersk. 5. 4.; 2. Bank. 193.; Montgomerie, July 27. 1673, (841.); Argyll, Dec. 14. 1676, (842.)
Respondent's Authorities.—2. Ersk. 6. 25.; 3. Stair, 2. 6.; Kilk. 145.; Brock against Cabbel, Nov. 29. 1822, (2. Shaw and Dunlop, No. 54.); Watson, Nov. 19. 1755, (850.); 3. Ersk. 3. 5.
Solicitors: J. Chalmer— Spottiswoode and Robertson,—Solicitors.