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Scottish Court of Session Decisions |
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You are here: BAILII >> Databases >> Scottish Court of Session Decisions >> Campbell v Williams [1835] CA 13_478 (17 February 1835) URL: http://www.bailii.org/scot/cases/ScotCS/1835/013SS0478.html Cite as: [1835] CA 13_478 |
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Page: 478↓
Competing.
Subject_Payment—Appropriation.—
Circumstances in which held, that rents of a property had been virtually appropriated by the proprietors towards payment of a particular debt due by their father.
John M‘ George, button-maker in Edinburgh, became, in 1830, indebted to Williams, Foster, and Company, of London, in the sum of £65, 3s. 7d. for certain furnishings of copper, made him through their agents in Edinburgh, Messrs Berry and Oliphant. George Berry, partner of this last-mentioned firm, had taken on lease a house belonging to M‘George's children! but, though the minute of lease was in name of M‘George, it appeared that Berry had been in use to get receipts for the rent signed by the children. At settling the rent due at Martinmas 1829, M‘George had written Berry in these terms:—“Should any balance of account betwixt us remain due by you in May next, you can retain it from the rents then due, as well as any balance that may be due Messrs Berry and Oliphant.”
At this time, Berry had certain claims against M‘George, and when the period for the next settlement came round, disputes arose between these parties as to their amount, for the determination of which they entered into a reference to an arbiter, who found, that, taking into account the rents due by Berry up to Martinmas 1830, there remained a balance owing by him of £28, 18s. 8d.; but M‘George refused to abide by this decree, on the ground of certain informalities, and Berry in consequence retained the whole rents in his hands. In the mean while, Berry and Oliphant, as agents for Williams and Company, of date 5th November, 1830, requested a settlement of the debt due by M‘George to Williams and Company. M‘George proposed to Berry and Oliphant that it should be liquidated by the rents due by Berry, amounting (without any deduction for counter claims) to £75, 15s. To this proposal Berry replied, that so soon as put in possession of a receipt, he would, if any balance remained in his hands, hold M‘George's instructions sufficient authority for placing it to his credit in account with Williams and Company, but that he would make no payment till he got the receipt. M‘George thereupon, on the 8th December, transmitted to Berry and Oliphant receipts for the rents, subscribed by two of his children, again desiring the amount “to be applied in payment of the copper only.”
To this Mr Imlach replied by the following note:—“Mr Imlach begs to acknowledge receipt of Mr M‘George's card of 11th instant, and having since seen both the partners of Berry and Oliphant, I learn from them that Mr M‘G. is under a mistake in the statement he gives as to the purpose for which the receipts referred to were placed in Mr O.'s hands, but at any rate that can have nothing to do with Williams and Co.’s claim; and, therefore, he can no longer delay enforcing payment of it, without incurring responsibility by doing so; this, however, need not prevent him making any explanation to that house which you may deem proper: and so far as Mr B. is concerned, he requests me to say, that the sooner you do so the better.”
M‘George thereupon wrote direct to Williams and Company, explaining to them that he had deposited the receipts for the rents due by Berry with Berry and Oliphant, “for the express purpose of settling” their account. In answer, Williams and Company wrote thus:—“We are in receipt of your letter of the 26th ult., and regret to find there should be any misunderstanding between yourself and Messrs Berry and Oliphant, relative to the settlement of the amount you are indebted to us for copper, viz. £65, 3s. 7d.
“The matter, however, in dispute appears to us to be one of a private nature between you and Mr George Berry, and in which, of course, we cannot interfere, never having authorized Messrs Berry and Oliphant to make such a settlement as that represented to us by you.
“The account being now considerably overdue, and having waited with great patience for our money, we are now obliged to say that Messrs Hopkirk and Imlach, writers of your city, have our instructions to raise an action against you for the recovery of the above sum, in case you resist the payment after receiving this letter, which we trust you will not do.”
The action was accordingly raised against M‘George, and, on the 7th
In the mean while, Mr Peter Campbell, S.S.C., “as agent for Mr M‘George's children,” of date May 9, wrote to Berry, informing him that he was authorized by the children, to recover the rents of the house. Berry refused to comply; but, on the Whitsunday rent also falling due, he intimated that he was ready to pay it on getting a receipt signed by “all” the parties interested, which he now thought it necessary to require. After some further correspondence, it was agreed that this half-year's rent, with the balance admitted by Berry on the rents of preceding terms, amounting in all to £42, 18s. 8d,, should be consigned in a bank, on a receipt in favour of Campbell, as agent for the M‘Georges, and Imlach, as agent for Berry, jointly; and this was accordingly done on the 9th June. On the 8th July, Campbell transmitted to Imlach a receipt, signed by all the children, and called on him to concur with him in indorsing the bank receipt for the consigned money to Williams and Co., towards payment of their claim. This was constantly declined by Imlach, till Berry's claims should be arranged, and as constantly pressed on the part of Campbell, in a correspondence extending to June, 1832. Meanwhile, the action at the instance of Williams and Co. against M‘George was going on, defences having been put in as to the discount to be allowed.. Decree was finally obtained, with expenses, in June, 1833, but M‘George had by this time become insolvent, so that nothing could be recovered from him. On the 19th July, Campbell obtained from M‘George a bill for £33, 6s. 10d. at one month's date, on which, when it fell due, he used arrestment in the hands of the bank in which the consigned money was deposited, and also of Imlach; and, in February, 1834, a multiplepoinding was raised in names of Campbell and Imlach, as holders of the receipt for the money so consigned. In this process, Williams and Co., with concurrence of Berry, put in a claim, founding on the appropriation of the fund in medio, by M‘George, with consent of his children, as proved by the receipts signed by them, and deposited for that purpose, and by the repeated demands of Campbell, their agent, upon Imlach, to indorse the bank receipt to them, and also on his arrestment in Berry's hands. Campbell, on the other hand, also put in a claim, founding on his arrestment in the hands of the bank and of Imlach. On revising this claim, M‘George's children became parties thereto, craving, so far as they had right to the fund in medio, that Berry might be preferred to it; and contending, that, as they were proprietors of the house, the arrestment by Williams and Co. of the rents, as due to their father, was inept; and, as to the alleged appropriation, that, although they had been willing to allow their rents to be applied to liquidate Williams and Co.’s claim, if these parties would have accepted the
The Lord Ordinary pronounced this interlocutor, adding the subjoined note: *—“In respect of the preferable arrestments used on the 7th
_________________ Footnote _________________
* “The Lord Ordinary assumes that the rents belonged to M‘George's children, though the lease was let by the father, as in his own right, and the tenant was not, perhaps, entitled to dispute his being creditor for the rent. But the material fact is, that the children not only signed the receipts along with the father, but distinctly admit that they did so for the very purpose of the sums in question being applied in payment of their father's debt to Williams, Foster, and Company. These receipts were accordingly handed over to the tenant, that this application might be made; and it was only in consequence of a dispute between that tenant and their father, as to the true state of accounts between them, that they were not so applied at the time they were so handed over. The children, indeed, now say that, though they did so consent to, and indeed urge, this application of the rents, they did it in the expectation that their father would be thereby relieved from the claims of Williams, Foster, and Company; and that, as he was not so relieved, and as those parties notwithstanding sued and recovered decree for the whole debt, they are now entitled to restrict their consent, and to take the rents to themselves: Although it is admitted that nothing was recovered from the father under this decree, and that the debt is still owing to a greater extent than the fund in medio, the Lord Ordinary does not doubt that the motive of the children was such as is stated; but their consent, and the virtual assignment of their right by delivery of the signed receipts, was not qualified by any condition, that it should be retracted, if the recovery of the debt were sought in any other way, or if the impediments arose in the way of an immediate application. There is not the slightest trace of any such condition in the correspondence, or any part of the transaction. The consigned sum, at all events, would pay little more than a half of the father's debt; and the creditors could never be considered as in any way barred from recovering the balance. They never at any time refused to take the rents, as in part payment; on the contrary, they used arrestments in the tenant's hands, to secure their ultimate recovery; But, finding that, owing to M‘George's disputes with the tenant, no immediate payment was likely to be had, they brought their action against M‘George, their proper debtor, for the whole sum, and recovered decree; and now they insist, in this multiplepoinding, that these rents, so appropriated and made over for their satisfaction, by the children, as well as the father, shall be applied, as was originally intended, towards payment of their subsisting debt. It is unfortunate that the fund was so long made inaccessible, by the disputes between M‘George and Mr Berry. But that was no fault of those creditors; though they certainly refused, in their action against M‘George, to hold the consent of his family to their taking an inaccessible fund, as equivalent to a present payment, they never either refused (as may be readily believed) to take such payment when they could get it, or relinquish the right they had acquired to an ultimate preference over it, by its original appropriation, and their consequent diligence. Indeed, it was not till the very last stage of the present litigation that this claim, on the part of the children, to retract that appropriation, or recall their consent, appears to have occurred to them. The record was about to be closed before they made appearance, though their agent was a party from the beginning.
“On the grounds now stated, the Lord Ordinary conceives that Williams, Foster, and Company are preferable to M‘George and his children, or any person deriving right through them, subsequent to the delivery of the receipts, on the appropriation and virtual assignment alone, without any aid from the arrestment. But he also thinks the arrestment effectual. There is no room for dispute as to the first, which affected the £21 due by the tenant before Whitsunday, 1831, the receipts and instructions for which had been given long previously; and even with respect to the second, looking at the tenor of the correspondence, which Imports a recognition of the father's assumed right of disposal from the beginning, he is of opinion that it is a good ground of preference.”
and 17th of May, 1831, by the claimants, Williams, Foster, and Company, of the consent of the children of M‘George, that the rents in question should be applied in payment pro tanto of their father's debt to the parties, and of the concurrence of Mr George Berry, ranks and prefers the said claimants, Williams, Foster, and Company, and Messrs Hopkirk and Imlach, their mandatories, to the whole of the fund in medio, now consigned in the National Bank of Scotland, on a receipt dated the 9th of June, 1831, with the bank interest accruing thereon since that date, till payment; the debts established in the persons of the said claimants greatly exceeding the amount of the said fund in medio, with the accruing interest thereon: Grants warrant, and ordains the cashier of the said National Bank to make payment to the said claimants of the sum due on the said receipt, and authorizes the clerk custodier of the said receipt to deliver up the same to the said claimants, or their agent or mandatories, in order that they may obtain such payment, and decerns in the preference and warrant for payment accordingly.”
His Lordship subsequently pronounced as follows, as to expenses:—“Finds the claimants, Williams, Foster and Company, entitled to the expenses incurred by them in this action; Finds the claimant, Peter Campbell, liable for the whole of these expenses; and the other claimants, the children of John M‘George, liable, conjunctly, for such part of the same as were incurred subsequent to their compearance in the cause,”—adding the Note below. *
Campbell and the children reclaimed.
_________________ Footnote _________________
* “The Lord Ordinary feels that this is a hard case for the children; and if the successful party could be considered as answerable for, or even acting in concert with, their agent, Mr Berry, he would not have given any expenses: But there are no grounds for inferring any legal responsibility, or privity between the parties; and, considering the extent of the litigation, and the small amount of the sum in question, he cannot, by refusing expenses, put the pursuers of a just claim in a worse situation, than if they had not brought their action.”
The Court accordingly adhered.
Solicitors: P. Campbell, S,S.C.— Hopkirk and Imlach, W.S.—Agents.
