Scottish Court of Session Decisions

I am of opinion that the last judgment, that of the Sheriff, is the sound one, and ought to be affirmed. But I rest my conclusion on somewhat different grounds from those of the learned Sheriff. I cannot draw the distinction which he does between the rent of land and that of houses. Neither am I prepared to consider the period when the rent, as it is said, vests—whatever that period may be—as of conclusive importance in the case. I adopt another, and somewhat simpler, ground of judgment, which I shall now briefly explain.

Undoubtedly there is a rule of law by which, in certain circumstances, payment of rent made anterior to the term of payment, is held not to discharge the tenant. Whatever may be said as to the policy of this rule, its existence cannot be disputed. It is more difficult to fix satisfactorily the precise persons in whose favour the rule operates, and who are entitled to take advantage of it, to exact a-second payment. Purchasers and donatories have been declared to be so entitled; and creditors are somewhat vaguely stated to have the same right. An arresting creditor of the landlord was found in one case to be entitled to exact a second payment. I am not quite satisfied that there is sufficient authority to lay down the rule as absolutely fixed in this last-mentioned case.

But the present is not the case of an individual purchaser or individual creditor. It is the case of a trustee in a sequestration claiming for behoof of the general body of creditors. A distinction has been drawn in the law between such a case and that of a simple purchaser, adjudger, or creditor. In the well-known case of Gordon v. Cheyne, and several others of a similar description, it was ruled that in regard to incorporeal rights, the trustee could only take the right tantum et tale, as it existed in the person of the bankrupt; and was liable to those equities which might not have affected a purchaser or special assignee. The principle of the case of Gordon v. Cheyne has been affirmed in subsequent cases; and I consider it to be now a fixed principle of our law. There is much good reason for distinguishing the case of a special contract made by the bankrupt with a person transacting with him in good faith whilst in the ordinary administration of his affairs, and the case of creditors at large realising the bankrupt estate in a general process of winding-up.

In the present case, I view the right sought to be enforced by the trustee, as a proper personal right arising out of contract. The right in which the trustee insists against Mrs Boyd, is the right accruing to the bankrupt under his contract of lease with that lady. This is a right under contract, and nothing else. A lease is in truth a personal contract, although vested by statute with certain of the qualities of a real right. It was anxiously pressed on us that the case was one of heritable right: the trustee being the successor of the bankrupt in the heritable property, as a special purchaser or adjudger might be. It would by no means necessarily affect the application of the principle, that an heritable property was in issue: for it may conceivably be applicable to an heritable right, where the right is merely personal, and the faith of the records is not concerned. But I think it is a misapprehension of the true question at issue, to suppose that it is a question of heritable right. There is no competing claim made either in the character of owner or creditor against the heritable property. The question is simply between the trustee and Mrs Boyd; the latter of whom is sued by the former to make payment of the rent stipulated by her contract with the bankrupt. I am of opinion that the trustee sues this claim simply in the bankrupt's right: and can only prosecute the claim to the extent and effect to which the bankrupt himself could enforce it. If I am right in this view, there is an end of the controversy; for clearly, in any question between Mrs Boyd and the bankrupt, effect must be given to the payment made by Mrs Boyd.

It appears to me that this is the simple and sound view on which the Sheriff's judgment should be affirmed: and I think it one to which the rule which disallows payments of rent made anterior to the term of payment cannot be effectually opposed. There is no authority to be found applying that rule to the benefit of creditors in a sequestration acting through the general trustee. I am, therefore, entirely free to consider the case on principle. I think in sound principle the trustee must be held to possess no higher right against Mrs Boyd than belonged to the bankrupt: and this, which I think the strictly legal view of the case, is also, I think, the only one consistent with equity and fair-dealing.

The other judges concurred.