Scottish Court of Session Decisions

Subject_1 HERITABLE and MOVEABLE.
Subject_2 SECT. XXVIII.

Effect of disposition of heritable subjects to trustees.

Patrick Brown
v.
Samuel Brown

Date: 16 January 1779
Case No. No 139.

An heritable bond was granted to a creditor over certain lands, which were afterwards sold for behoof of the creditors of the debtor. The debtor in question survived the sale, but died before division of the price. Found, that so much of the price as corresponded with the annualrents was moveable, but that the share corresponding to the principal sum in the bond continued heritable.

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William Cathcart granted an heritable bond over his lands to Dr Brown, for security of a debt previously due to him. Dr Brown, who resided at Kingston, executed a power of attorney to Messrs Blackburn and Barclay, authorising them to obtain him infeft on this heritable bond, and “to act and do all other things relative to the premises, as if he were personally present.” Infeftment was accordingly taken in his name by his attornies.

About this time, several adjudications were led against Cathcart's subjects by his other creditors; and, in order to prevent the expense of a judicial sale, the creditors agreed upon an application to the debtor, to name commissioners, with powers to sell the lands, and divide the price among the creditors pari passu.

A commission was accordingly executed by Cathcart, and the commissioners under it were empowered to sell the lands, and grant dispositions in the name of Cathcart to the purchasers, which were declared to be “sufficient security to them.” After part of the lands was sold, the creditors, in a deed executed betwixt them and the trustees, ratified the commission and sales, with this proviso, “that the produce arising from the sales should be divided equally among the creditors, according to the extent of their debts.” The attornies for Dr Brown joined in the original application, and were parties to this deed.

Dr Brown survived the sale of these subjects, but died in Jamaica before any payment was made. By his will, he left his whole personal estate to Mr Blackburn, who conveyed all right he had to it under the will, in favour of Patrick Brown, in consequence of a transaction between them.

In a multiplepoinding brought by the purchasers of Cathcart's subjects, a competition arose betwixt Patrick Brown claiming under the will, and Samuel Brown, the heir of conquest to Dr Brown, which of them had right to the part of the price corresponding to the Doctor's debt. The issue of this competition depended on the question, Whether the debt was heritable or moveable at the time of the Doctor's death? For, if heritable, it went to the heir of conquest, all Dr Brown's fortune having been of his own acquisition; but, if moveable, it went to Patrick Brown, who had right to the moveable effects.

Pleaded for Patrick Brown: Though the debt due to Dr Brown was at one time heritably secured, this security was given up, and the debt became moveable by the transaction for bringing on a voluntary sale of the estate. Dr Brown, acting by his attornies, was a party to the whole of the transaction.

The concert among the creditors to come in pari passu, and the powers given to the commissioners to draw the price of the lands, as well as to sell them, and to give sufficient dispositions to the purchasers, necessarily import, that the heritable securities were entirely departed from. The right of every creditor, after the commission, resolved into a personal claim against the commissioner, for a proportion of the price corresponding to his debt pari passu with the other creditors.

Pleaded for the heir of conquest; The attornies had no powers from Dr Brown to alter the nature of his debt from heritable to moveable. Their powers went no farther than to complete the security of the heritable bond by infeftment.

But no such alteration on the debt was agreed to by the attornies. The transaction only imported, that Dr Brown should restrict his claim as to any preference he might be entitled to, and come in pari passu with the other heritable creditors. It was not stipulated that he should depart from his infeftment as an heritable security for his share of the price. The transaction does not go that length; and the lands could not have been disburdened of the heritable security upon them by any disposition from the trustees to the purchasers, nor until Dr Brown's share of the price was paid up to him. He was in the same situation, in this respect, as if the lands had been sold at a judicial sale, where the heritable securities continue on the lands until the price is paid to the creditors.

The Court were of opinion, That the attornies of Dr Brown had not sufficient authority from their commission to change the nature of the debt from heritable to moveable; and likewise, that the transaction did not import, that the heritable security was to be given up.

The Court found, ‘That the share of the price of Mr Cathcart's lands, in the hands of the purchasers, the raisers of the multiplepoinding, effeiring to the annualrents due in Dr Brown's heritable bond, at the time of his death, is moveable, and falls to the Doctor's executors; but that the share of the price, effeiring to the principal sum in said bond, is heritable, and falls to his heir of conquest.’

Lord Ordinary, Hailes. Act. Armstrong. Alt. Crosbie Clerk, Tait. Fol. Dic. v. 3. p. 268. Fac. Col. No 59. p. 106.