Judgment:
Lord Chancellor—My Lords, this is a case in which the Lord Ordinary thought it right to allow a proof before answer, such proof being offered in support of certain averments by the appellant that his lease of this freestone at Baberton could not be worked at a profit. The respondent raised the point that the appellant's averments were not relevant, and the Inner House thought that this was a case in which the heavy expenses and delay caused by going into evidence ought not to be thrown upon the respondents, inasmuch as the averments, even if proved, would have been utterly irrelevant, and in so deciding I think the Court was quite right. The real question for your Lordships is, Whether the Court was right in holding these averments to have been irrelevant? The appellant under this action was bound to prove, what was certainly not an easy thing to do, that the freestone now to be found in these lands could not be worked at a profit, and that, inasmuch as there was no subject-matter for the lease to operate upon, that lease ought to be reduced. This is certainly a startling proposition to make, for in looking at the terms of the lease the appellant seems to have got a lease from Mr Christie of all the freestone and other minerals whatsoever in the estate. Now, the principal argument of the appellant is, that by the Roman law, which he says is followed by the law of Scotland, there is an implied warranty in the lease that the tenant shall get possession of subject-matter that is capable of producing profits. No doubt in some respects this is reasonable enough. It is reasonable that when a lease is granted there shall be a subject-matter in existence, for, as it is said in England, if the consideration of the contract wholly fails, there shall be an end of the contract, but it is quite a different thing to contend that because the subject-matter exists only in small quantities, and there cannot be a profit made by working it, therefore the whole lease is to be reduced and treated as void. There were various old authorities and cases referred to, but all these will be found to amount only to this, that if the subject-matter is non-existent, or has become exhausted, no rent can be claimed. The risk as to the quantity or value of the fruits or profits is said plainly to be the risk of the tenant. Now, this is not a case of that kind. It is true the freestone does not exist in the large quantities expected, but there is, some, and the mere fact that what there is cannot be worked at a profit is no ground for reducing the lease. The lease is so drawn that it contains breaks, of which the tenant may take advantage, and these breaks were held by the Court below to be designed to meet sufficiently the risk of sufficient freestone not being found. The appellant might have broken his lease at the end of three years, but he failed to do so, therefore on both grounds, viz., that there is no such common law right as he contends for, and that his lease provides the remedy, I think the judgment of the Court below was right, and ought to be affirmed.
Lord Chellmsford—I entirely concur. The law of Scotland is shortly stated in Bell's Principles, and it does not justify the contention of the appellant. When the older authorities speak of sterility as being a ground for a tenant getting rid of his lease, they obviously mean absolute or permanent sterility, such as that no mineral exists, or if it once existed has become exhausted. Moreover, it is obvious that sterility was merely a ground for abatement or suspension of rent; even when it was applicable, it was extremely difficult to apply it. Lord Deas says in his judgment that if an Egyptian had taken a lease which began with seven years of plenty, it would be hard to say that when the seven years of famine followed he was to get quit of the lease, and all the loss to fall on the landlord. The present lease seems to provide a sufficient remedy for the circumstances in giving the tenant the option of breaking the lease at the end of three, seven, or fourteen years. I think the decision of the Court below was right, and ought to be affirmed.
Lord Colonsay—I agree with your Lordships, and have very little to add to what has been said. The appellant has quite failed to make out a relevant case. This was a contract between two parties. No doubt a lease can be granted of minerals
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as well as of lands, but it by no means follows that all the incidents of an agricultural lease will apply to a mineral lease. Now, no case has been referred to where it has ever been held that the doctrine of sterility applies to a lease of minerals, and all the cases quoted are merely cases where the subject-matter of the lease was non-existent, or had become exhausted. Here the lease shows that the parties had provided their own remedy for what has happened, and that is, that there are periodical breaks which the tenant may take advantage of if he is so disposed.
Lord Cairns—I agree with your Lordships. This case began on the view that the tenant was induced by misrepresentation to enter into the lease, but that ground entirely broke down. Then he sought to get rid of the lease on the ground of sterility, but that doctrine is obviously inapplicable. In fact, it is not quite correct to speak of a lease of minerals; it is nothing but a sale out and out of the part of the soil occupied by the minerals, and an authority to the tenant to go on the lands and take those minerals away. This is a very different thing from the ordinary mode of the cultivation of the surface of the soil by means of crops. The doctrine of the civil law about sterility extended only to cases where the land, the subject of the lease, was non-existent; it did not apply to the operations of modern agriculture, which are spread over a large surface, and often produce profits only after a great lapse of years. There is therefore no such doctrine as the appellant relies on applicable to this case; and though the Court below relied chiefly on the ground that the parties had contracted themselves out of the law, I prefer to rest my judgment on the ground that there is no common law on which the appellant could get rid of this lease.
