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The Creditors of Dumfermling v Mr David Cowper, late Factor appointed by the Lords upon that Estate. [1710] Mor 4418 (5 July 1710)
URL: http://www.bailii.org/scot/cases/ScotCS/1710/Mor1104418-007.html Cite as:
[1710] Mor 4418
The Creditors of Dumfermling v. Mr David Cowper, late Factor appointed by the Lords upon that Estate
Date: 5 July 1710 Case No. No 7.
A factor appointed on an estate by the Lords, found liable to account to the creditors, either according to the fiars, or the prices he sold at, reserving to him to be heard as to what ease he might claim, on account of his not receiving payment from the merchants of the whole agreed prices.
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In the compt and reckoning at the instance of the Creditors of Dumfermling, against Mr David Cowper their factor, the Creditors charged him with the prices at which he sold the victual.
Answered for Mr Cowper; He can be obliged to compt only at the fiar-prices, as the most equal for both parties; for, a factor being supposed to sell for ready money, is presumed to get no more than the fiars, and if he sell to a day, in prospect of a higher price, he thereby runs a risk, if the merchants happen to break medio tempore, et quem sequitur incommodum, &c. Nay, it is visibly to the advantage of creditors that the fiars be the rule, with this quality, that the factor get no allowance for the charges of selling and disposing of, or receiving the victual, or doing diligence for the price, or upon the account of the buyer's turning insolvent; and no such allowance is claimed by Mr Cowper. Besides, by establishing of the fiars as the standard, the creditors have this further benefit, that the charge against the factor is liquidated by an extract of these, without the trouble and expense of a probation, which any other rule would require; and, should a factor be obliged to answer for the prices sold at, he hath reason to ask allowance in his discharge of all charges and accidental losses by the sale, which may sometimes reduce the price far below the fiars. 2do, Mr Cowper is content to hold compt at the prices he received for the victual, if the creditors will take it complexly, and accept of these prices every year, though sometimes below the fiars, which cannot be thought unreasonable; seeing they who reap the advantage, should also suffer the loss.
Answered for the Creditors; Factors, as trustees for the creditors, getting both allowance for their necessary charges, and a salary for their pains, are bound to do exact diligence, and compt for the prices sold at, or instruct that they sold bona fide to persons responsible at the time, upon usual security, and at the term of payment did diligence, and could not recover the prices: For law presumes, that a trustee liable to diligence, received what he ought and should have received; therefore, if he sold to some above, and to some below the fiars, he must compt for the fiars when he sold below them, and at the price he sold for, when above them; seeing to allow a factor, who sold perhaps for a third above the fiars, to be liable in all events only for the fiars, were to free him from diligence, which is the consequence of his trust and office. And why should not a factor named by the Lords compt for prices received, as well as the factors of private men.
Replied for Mr Cowper; The disparity betwixt the Lords' factors, and those of private men is, that the latter do commonly follow their master's particular instructions, whereas the former must act upon their peril; and a master may, from his own private knowledge of circumstances, dispense with the doing of diligence, or the like; but nothing can be allowed in a factor's exoneration before the Lords, without the nicest probation of circumstances.
The Lords found, That the creditors' charge must be constituted against Mr Cowper, either according to the fiars, or the prices he sold at; reserving to him to be heard upon what diligence he was liable for, and what ease he may claim upon the account of his not recovering payment of the whole agreed prices from the merchants.
