United Kingdom House of Lords Decisions

The appellant, on the other hand, pleaded:—

“I. The charge complained of was fully warranted by the document of debt charged on.

II. The suspender having borrowed the sum charged for, under the promise and engagement, and in the circumstances condescended on, and having granted the bond for its repayment, which is now charged on, and having neither proved nor averred matter relevant to discharge him of his liability to repay the sum borrowed, the letters ought to be found orderly proceeded.”

Before the case was advised upon the record, the respondent lodged a minute stating, “That, without acknowledging any personal liability for the sums charged for, but solely in order to save great loss and expense to the trust estate, under the management of the suspender and his co-trustees, he, the suspender, was willing to advance from his own private funds, a sum sufficient to pay the whole principal sums and interest contained in the bond and disposition in security held by the charger, and also to consign in bank a sum sufficient to cover the whole expenses claimed by the charger, as falling under the penalty in the bond, or incurred in the two processes of suspension, depending between the parties, till the question as to these expenses should be determined, either by the Court, or under a reference to Mr Guthrie Wright, or any other arbiter to be mutually agreed upon.—That this offer had been made in a letter dated the 17th September 1839, addressed by the suspender to Mr Hunter, the agent for the appellant, and under form of protest.—That, without acknowledging any liability for the sums charged for, the suspender now judicially repeats the offer formerly made by him in his letter and protest.”

“That, in these circumstances, the Lord Ordinary would perceive that the only point necessary to be determined in this

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process, relates to the question of expenses; and the Lord Ordinary was accordingly moved to make avizandum, with the view of closing the record, and afterwards appoint the parties to debate upon that question.”

The appellant answered this minute by referring to the correspondence between the parties, shewing that the difference between them was in regard to the liability for the expenses, which had been incurred, and concluded thus:—

“The charger is still willing to refer to the auditor of Court to tax his agent's whole accounts, and to determine what sum is payable under the stipulation in the bond as to liquidate penalty, over and besides principal and interest; and on receiving payment of the principal, interest and liquidate penalty, as ascertained, he is ready to discharge or convey the bond and disposition in security, and infeftment in question. In short, he is ready to discharge or convey all claim of every kind under the bond in question, including all claims for expenses at his instance, in and regarding the several processes, as these shall be taxed and ascertained by the award of the auditor, as referee. But he declines, for the reasons appearing in the correspondence, and others unnecessary to be stated, to make any claim for expenses at the suspender's instance the subject of reference.”

On the 21st December, 1839, Lord Moncrieff (Ordinary) pronounced the following interlocutor, and added the subjoined note:—

“The Lord Ordinary, having considered the closed record in these conjoined processes of suspension, and having heard parties' procurators fully thereon, and made avizandum; finds that there was no legal warrant in the heritable bond and disposition on which the letters of horning were issued for charging the suspender as on personal diligence, for payment of the debt in question, as due by him personally and individually : Finds, separutim, that after the first bill of suspension had been passed, it was

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not competent to give a second charge on the same bond and letters of horning, which were already under suspension by the first depending process: Therefore, and to the effect above expressed, sustains the reasons of suspension in both processes, suspends the letters, and decerns; but without prejudice to all other questions between the parties : Finds expenses due, and allows an account to be given in, and remits the same, when lodged, to the auditor to be taxed; but reserves for future consideration, after the account shall be audited, how far there may be ground for some modification thereof.

Note.—The minute and answers reduced this cause to a question of expenses. The charger was offered full payment of the principal and interest of his debt, and of all expenses incurred by him, to be ascertained according to a reference proposed. The charger agreed to this, except that he would not refer the question as to the suspender's claim of expenses in the processes of suspension. He wished to have it assumed that he only could have any claim of expenses. In consequence, it became necessary to discuss the merits of these suspensions, after all the subject-matter of them was at an end.

Now that they have been fully heard, the Lord Ordinary is of opinion that the charges cannot be sustained. Looking to the first charge, it is a charge on letters of horning taken on an heritable bond granted by the defender and certain other gentlemen, expressly as the trustees of the deceased Andrew Bell, and the warrandice clause bears in direct words, that they bind themselves, ‘but qua trustees only.’ On a bond so conceived, the charger takes letters of horning, of course according to the terms of the warrant for registration, and charges the suspender, one of the trustees, with the avowed purpose of personal diligence against him, as being personally and individually liable for the whole amount of L.7000, expressed in the bond, with interest. The Lord Ordinary thinks this incompetent. The charger justifies it by detailed statements of proceedings, by which he thinks Mr

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Campbell rendered himself personally liable for the debt. This may be very possible, though the Lord Ordinary thinks that the charger was far from succeeding in shewing it in the debate. But it is nothing to the point. The charger might have had a very good ground of action for his debt and all damages against Mr Campbell. This has nothing to do with the question as to the competency of these charges of horning against the individual respondent.

The bond is a common heritable bond granted by certain trustees on the estate of Andrew Bell, of whom Mr Campbell was one. There was nothing in it but the common obligation by the granters, as trustees, followed by the conveyance of the heritable subjects in security. If, on such a bond, any one trustee may be charged and laid under caption, which was stated to be the fact here, for the whole sum in the bond, the system of trusts, of such vast importance to the country, would speedily come to an end. It is beyond all doubt, that there is no such personal obligation imposed by the bond, on which any letters of horning could issue, sufficient to warrant such a charge. The charger seems to be aware of this, and tries to make out a personal responsibility in Mr Campbell individually, and in the other trustees, on their acts and deeds, extraneous to the bond. He may be right or wrong in this. He may have had grounds for an action against them to make good his debt, if he had failed in making it good by his bond, and for any damages he thought he could claim. But this is not the point. Could he competently charge Mr Campbell personally, and take personal caption against him, for this as a personal debt of his? The proposition appears to the Lord Ordinary to be absolutely untenable. The charger had no warrant for letters of horning but the bond itself, in which Mr Campbell is not personally bound at all. Although therefore, his grounds of claim against Mr Campbell personally, to make good the debt—to guarantee the lands to be free of encumbrances—to see the prior debt paid, &c &c., were as clear as he represents it, though of a very doubtful character, it would afford no aid to his plea, for supporting the charge of horning. Such claims require constitution by action. They require proof of the facts averred, judgment on their relevancy, decree on the whole

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matter. Till there is such a decree, there can be no warrant for any charge of horning which is to be supported on such grounds. The bond and the decree of registration on it, have no such thing in them. They rest on the simple obligation of the trustees, qua such only. They make no personal liability in a single trustee. And most especially, it is impossible to maintain, that when such trustees grant an heritable bond as trustees only, the obligation expressed in it imports a personal undertaking by each trustee, on which the creditor may, on any loose and unproved allegations of personal acts, be at once charged with horning for the whole debt, however large, and put in prison till he pays it.

Being thus of opinion, that the charge of horning was funditus incompetent, the Lord Ordinary does not feel himself to be under the necessity of considering particularly the charger's statements, directed to the object of proving that the suspender had made himself personally liable for the debt. It might have been so found in a proper action ; though the Lord Ordinary doubts the soundness of the whole views on which it is maintained. The charger does not observe the importance of the fact, that his own accredited agent was the chief actor in the whole affair, and far more deeply engaged in it than he even alleges Mr Campbell to have been. That he may have deceived the charger, his employer, is a possible supposition. But all that took place, confessedly without Mr Campbell's concurrence, had, at the least, Mr Bennett's sanction, if it did not in fact entirely originate with him. The L.3000 was put in his hands, or at his command, as the charger's agent. If he let it be otherwise disposed of than it ought to have been, it is rather hard that the charger, who had put his confidence in him to negotiate the loan, should cast on Mr Campbell, who refused to sanction Bennett's proceedings, the blame of what he did or approved of. And besides this, the whole money was repaid to Mr Bennett, and afterwards re-lent, without any authority by the trustees.

But these views are of no materiality to the point. The parties are not in an action for making Mr Campbell liable for special acts or undertakings. The Court have nothing to deal with but

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the charges and the suspensions; and these must and can only depend on the bond.

This state of the case entirely excludes any application of the case of Thomson referred to, 24th June, 1829 No one can attach more importance to the authority of that case than the Lord Ordinary does. But, besides that it is essentially different in the special facts and grounds of judgment, from any state of the case which can be here assumed, its application is at once excluded by the fact, that the question was tried in an ordinary action of constitution, and not in a suspension of a charge of horning on the bill. It would have been a far more plausible proceeding in that case. But it was not attempted. The process was an action, which admitted of proof of all manner of grounds of personal liability. That has no resemblance to the present question, in the objection of total incompetency.

The charger says, that in a certain correspondence, the suspender had abandoned the first suspension. The Lord Ordinary has read the whole correspondence, and he is of opinion, that there is nothing in it which can have the effect of rendering it incompetent for Mr Campbell to proceed with the first suspension, under the circumstances which occurred in April 1839. He sees, indeed, that the whole matter had been on the eve of a complete settlement, and probably would have been settled long before, but for certain very trifling difficulties chiefly raised by the charger. It appears, however, to have been fully known to the charger and his agent, that the arrangement was of this nature, that Mr Campbell should advance three-fourths of the sum required, and that Mr Spence should advance the other fourth. This appears distinctly from the terms of the deed of assignation, which had been actually signed by the charger, and which is in favour of Mr Spence to the extent of his interest; and it is farther proved by Mr Hunter's letter of the 18th April 1839. Although, therefore, it is true, that, in the expectation of the settlement taking place, Mr Campbell had declared his intention not to proceed with the suspension, it surely will not follow, that, when upon the bankruptcy of Spence the charger refused to settle it, unless Mr Campbell should take the whole debt

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upon himself personally, and forthwith executed a second incompetent charge of horning, he should be obliged to submit to the first charge, while he was advised that his suspension was perfectly well founded. But after all, the discussion of this case has only been rendered necessary by the charger's having declined the apparently reasonable offer made by the suspender in the month of August.

If the first charge was incompetent, the second must have been so. But separately, the second charge was, in the Lord Ordinary's opinion, manifestly incompetent, for the reasons briefly but clearly stated in the note of Lord Jeffrey, in passing the bill without caution. The first suspension did not proceed merely on the groundlessness or incompetency of the particular charge. It impeached the bond as a ground of any charge against the suspender personally, and the horning as incompetent to sustain such a charge. That first charge included a demand of the whole principal debt. The second related to another year's interest. But the very basis of the diligence was under suspension by the first process; and, consequently, there could be no other similar process in virtue of it, while it so stood. It should have been altogether abandoned when the bill was passed.

In this state of the cause, the Lord Ordinary can do nothing but decide it on its merits. He regrets that it should have been forced to this point. But there is no help for it, since the charger, exercising his undoubted right, insisted on its being so treated. But still there is no interest at all involved but the question of expenses. And the Lord Ordinary earnestly trusts, that, whatever the charger may be advised to do in regard to that question, he will now accede to the offer of payment of the principal and interest of the debt, and consignation of whatever may be necessary to cover all claims of expenses in any result; and, without more hesitation, discharge the encumbrance to the purchaser; or otherwise, that he will consent to an arrangement with the purchaser for whatever consignation may be necessary.”

The appellant reclaimed to the Inner House, (the Second

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