Scottish Court of Session Decisions

The late John Buchanan, merchant in Glasgow, was a partner of the firm of Grasemann & Company, merchants in British Burmab, of which firm he latterly was the sole partner. In 1859 Grasemann & Company purchased certain land and premises at Poozoondoung, Rangoon, on which they erected rice mills. The firm became unsuccessful. It stopped business, and was wound up as an insolvent concern at Rangoon in the end of 1867. The heritable properties above mentioned were exposed to sale by public auction by and for behoof of the creditors of the company, and were purchased by Mr Thomas Matthew, merchant, Glasgow, at the price of about £20,000; Mr Matthew also took over what remained of Grasemann & Company's business, and carried it on in partnership with Mr Buchanan, under the firm of Matthew, Buchanan, & Company of Glasgow, and Buchanan & Company of Rangoon. Mr Buchanan's interest in the new concern was merely nominal.

Grasemann & Company had received advances from the City of Glasgow Bank, and were also indebted to Mr John Hunter, merchant, Glasgow. The money with which Mr Matthew paid for the above properties was also borrowed from the City of Glasgow Bank; and it was resolved to take the title in the joint names of Mr Matthew and Mr Hunter, so as to afford some security to Mr Hunter and to the bank. In order to carry out this intention, Mr Buchanan, in whom the title to said properties was vested as sole surviving partner of Grasemann & Company, with Mr Matthew and Mr Hunter, executed a power of attorney in favour of Mr Alexander Hotson, Buchanan & Company's representative at Rangoon, in which it was recited that it had been determined that the above subjects should be transferred to and registered in the names of Mr Matthew and Mr Hunter till further instructions; and power was given Mr Hotson to take whatever steps might be necessary for completing Mr Matthew's and Mr Hunter's title; but acting on letters from Mr Matthew and Mr Buchanan he in April 1868 executed a conveyance to Mr Matthew alone.

In 1873 Mr Buchanan retired from partnership with Mi Matthew. On 30th April 1874 his estates were sequestrated by the Sheriff of Lanarkshire, and on 15th May 1874 William Brown was duly confirmed trustee thereon. The trustee realised the estates so far as known at the time, and divided the whole free realised funds in common form. The funds were insufficient to pay the creditors in full. The trustee was thereafter, on 16th December 1875, duly discharged by the Sheriff of Lanarkshire. Mr Buchanan died on 8th January 1875 without being discharged.

On 18th November 1878 the firms of Matthew, Buchanan, & Company and Buchanan & Company were adjudicated bankrupts by the London Bankruptcy Court, and Mr William Hurlbatt, accountant, of 8 Old Jewry, London, was appointed trustee thereon. He sold the Rangoon properties, which formed part of the bankrupt estate, but difficulties arose regarding the title to be given to the purchaser owing to the directions contained in the power of attorney above mentioned to convey the properties to Mr Matthew and Mr Hunter not having been duly observed, but the conveyance taken to Mr Matthew alone. It had become impossible, on account of Mr Hunter's death, to obtain his concurrence in a new conveyance, and in consequence of Mr Buchanan's death and his trustee's discharge it was also impossible to obtain any consent on his part thereto. The sole persons interested in the estates of Matthew, Buchanan, & Company and Buchanan & Company were their creditors the City of Glasgow Bank and liquidators, and they were advised by their solicitors in Rangoon that good title might be given by having a new conveyance granted by Mr Matthew's trustee, Mr Hunter's executor, and Mr Buchanan's trustee. In these circumstances the former trustee in Mr Buchanan's sequestration, together with two of his creditors, petitioned the Court “to remit to the Lord Ordinary on the Bills to appoint a meeting of the creditors of the said John Buchanan, to be held at such a time and place as his Lordship may fix, to elect a trustee or trustees in succession, and commissioners, on the said sequestrated estate; and to appoint the said meeting to be advertised in the Edinburgh Gazette; and to remit to the Sheriff of the county of Lanark to proceed in the said sequestration in terms of the statute.”