Scottish Court of Session Decisions

This was an action of count and reckoning at the instance of David Palmer, John Pyper, and J. C. Hay, members or partners of the Commercial Building Co., against John Christie, who was also a member, and acted as treasurer of the company.

The company consisted of these four partners and one other (Mr Gray), and was formed for the purpose of erecting dwelling-houses and shops, and selling them for behoof of the company. The company was formed in virtue of articles of association recorded in the Books of Council and Session. The purpose for which the company was formed was completed, and the balance of profit on its transactions was divided amongst the partners, in the summer of 1877.

The pursuers had subsequently been called upon by the Royal Bank, where the company had kept their account, to pay £343, the amount of a debt due by the company to the bank, and had so paid that amount. The pursuers had demanded that this balance should be paid by the defender, upon the footing that he had sufficient funds of the company in his hands to do so. The defender denied that he had; and this action was then raised concluding against him for count and reckoning of all the affairs of the company, and of all his actings as treasurer, and for payment of such sum as should be found due. Mr Palmer did not insist in the action, and the other pursuers then restricted their claim to two-thirds of £500 or whatever other balance should be found due.

By the articles of association Messrs Palmer, Gray, and Pyper had been appointed trustees to sue for all debts due or that should be due to the company.

The defender's first plea was—No title to sue.

The Lord Ordinary ( Adam) sustained this plea and assoilzied the defender. He added this note—“This action is now insisted in at the instance of John Pyper and John Charles Hay, two out of the five partners of the Commercial Building Company. Mr Palmer, who was also a pursuer, has withdrawn from the action.

“The defender is treasurer of the company, and the action is an action of count and reckoning calling upon him to produce an account of the affairs of the company and of his intromissions as treasurer, whereby the balance due by him to the pursuers may appear, and for decree against him for that balance.

The Lord Ordinary is of opinion that the defender is the servant of the company, and is bound to account to the company, but that he is not bound to account to the individual members of the company. Assuming it to be the fact that the defender is indebted in a sum of money to the company, he is neither bound nor entitled to pay that sum to the individual partners in proportion to the amount of their shares or interest in the company. The Lord Ordinary therefore thinks that the pursuers have no title to insist in this action.”

The pursuers reclaimed, and argued—This was clearly a joint-adventure, and the present action was one to settle up the partnership accounts inter se, and therefore the pursuers had a good title.

At advising—