Scottish Court of Session Decisions

Subject_1 FACULTY.
Subject_2 SECT. III.

Faculties when effectually Exercised. - Effect on Heirs. - Effect on Singular Successors. - Competition of Creditors claiming under Reserved Faculties.

David Graham
v.
His Brother, the Laird of Morphie

Date: 15 February 1673
Case No. No 10.

A father disponed his estate to his eldest son in his contract of marriage, reserving to himself a power to burden the estate with a certain sum of provisions to his younger children. This clause was found to produce action to the younger children against their elder brother, the father having died without exercising the faculty.

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The said David, as having right by assignation from Alexander his brother, and Helen Graham his sister, to their proportional parts of twenty-five thousand merks, provided by their father to his six younger children in their elder brother's contract of marriage, did pursue Morphie for payment of their proportions. It was alleged for Morphie, that the provision in his contract of marriage could furnish no action, because it was conceived in the terms of a naked reservation only, to burden the estate with the foresaid sum in favour of the rest of his children, which being nuda facultas, unless the power reserved had been put in excercise by the father in his own lifetime, and infeftments given to the children for their security out of the estate; neither can Morphie be personally liable, not being heir to his father, nor his estate burdened so as he ought to make payment of the debt for relieving thereof, and this point was lately decided, betwixt the Duke of Lauderdale and Learmont and her Spouse, No 9. p. 4099. It was replied, that the defence ought to be repelled, and Morphie decerned to make payment notwithstanding; because, in a former action pursued at the instance of the Creditors of Henry Graham, one of the six children, the Lords had decerned the defender to make payment upon the very same ground and clause of provision which is the ground of the action. It was duplied, that that decision was upon another point of law than what is now contraverted, which was not then alleged, viz. that the provision reserving power to the father to burden the estate with the sum of 25000 merks, to be divided, being left blank and never filled up by him what should be their proportions, could not be done after his death, and so it was not obligatory against his eldest, which allegeance hath no affinity with that now proponed; and therefore the defender craved an interlocutor in jure upon this defence now alleged. The Lords having considered the former decision, at the instance of another brother, did find in that case, that this allegeance was not proponed; as likewise having considered that reservation contained in the contract of marriage, did find, that imported nothing but a reservation to burden, but did not at all affect the disposition itself made to his son; and therefore they did consider and debate much amongst themselves upon their interlocutor to be given as to this point, and did at last find, that Morphie was liable to payment notwithstanding of this allegeance and the foresaid practick, which they did find did not meet this case, because the ground of that decision was, that in the foresaid case, the power reserved to the father was to contract debts, and borrow sums of money, for which he might grant infeftments to the creditors, which not having done in his own lifetime, a stranger buying these lands for the full value, could not but think himself in tuto to make a purchase thereof, there being no infeftment to be found in any register, and therefore the creditors who lent their money, and not taking infeftment, could only have personal action against the disponer and his heirs, but could not make a stranger who had purchased the lands liable to that burden, it being their own fault that they did not secure themselves when it was in their power; whereas, in this case, Morphie did know and consent that his father should grant these provisions in favours of his younger children, which being but mean, and such as he knew the estate might bear, with other debts, he could never quarrel the same as being a stranger, and ignorant thereof: And the saids provisions, and his fee of the estate being in eodem corpore, and done at the same time, the children were most favourable creditors for their portions; and unless Morphie had renounced the said disposition, and not acknowledged the same, it ought to give them as good right to their portions, as him to the fee of the estate; seeing, if he had entered heir to his father, and miskenned the disposition, he would undoubtedly have been liable, the said provision, importing a constitution of debt for the children's provisions, which, in law, would bind heirs or executors, and importing no less than in so far as the disposition made to the eldest son was lucrative, they might have reduced it upon the act of Parliament, as done in fraudem creditorum; and therefore the reservation, as it was but nuda facultas, not being exercised, and taking effect, did prejudge them of their real security, as it was found in that other case, but did not make the obligation void and null for their portions against Morphie, upon the foresaid grounds of law.

Fol. Dic. v. 1. p. 291. Gosford, MS. No 575. p. 316.