Scottish Court of Session Decisions

This was an appeal in an action of multiplepoinding in the Sheriff Court of Dumbartonshire, of which the nominal raisers were certain marriage-contract trustees, the subject in medio being certain articles of furniture. The circumstances out of which the case arose were narrated in a joint minute of admissions lodged by the parties in course of the process, and were to the following effect:—The furniture forming the subject in medio was purchased by Mr M'Caul, manufacturer in Glasgow, at the time of his marriage in 1867, and was in 1876 placed by him in Hayfield Villa, Helensburgh, where he then went to live. Hayfield belonged to his marriage-contract trustees, the nominal raisers, and the M'Cauls occupied it, by agreement with them, continuously from that date till June 1882, with the exception of a short period in 1878–9, when it was let by the trustees.

In 1878 M'Caul, being in pecuniary difficulties, granted a trust-deed in favour of Walter Mackenzie, C.A., conveying to him his whole estate, including the furniture in Hayfield Villa. Mackenzie wound up his affairs, but did not enter into possession of Hayfield or remove any of the furniture, which still remained there at the time of the raising of this action.

In August 1878, after M'Caul had put his affairs under trust, James Robertson, his brother-in-law, and one of the marriage-contract trustees, with the knowledge and approval of the M'Cauls, arranged to buy from Mackenzie, as M'Caul's trustee, the furniture in Hayfield House.

In September 1878 Robertson, on the occasion of his going abroad, granted a factory and commission in favour of his agent Laurence Thomson, writer in Glasgow, the appellant.

On 26th October 1878 Mr and Mrs M'Caul granted the following letter of obligation addressed to Laurence Thomson's firm, Messrs Laurence Thomson & Miller:—“Dear Sirs,—In consideration of the fact that your clients, Mr Hugh Robertson and Mr James Robertson, Plantation Engine Works, Glasgow, have made payment to the trustee upon the estate of Mr James S. M'Caul, manufacturer, Ingram Street, Glasgow, of the sum of £300 on my household furniture and effects within my dwelling-house at Hayfield, Helensburgh, and have obtained an assignation of same in their favour, conform to inventory thereof made out by Hutchison & Dixon, licensed valuators in Glasgow, I, the said James S. M'Caul, and I, Isabella Dixon Robertson or M'Caul, wife of the said James S. M'Caul, jointly and severally agree and undertake that we shall pay to you, on account of your clients, the sum of £50 per annum, payable by two instalments of £25 at each term of Whitsunday and Martinmas, commencing the first term's payment at the term of Whitsunday 1879, and continuing the same until the amount of said advance, with periodical interest at 5 per cent. on the balance from time to time remaining, shall be repaid. We further agree and consent that this letter shall be intimated to the trustees under our antenuptial contract of marriage, dated 24th December 1867, and recorded in the books of Council and Session 27th August 1873. It is of course understood that when the balance shall be finally paid the household furniture, &c., shall be conveyed by your clients as we may direct.”

On 7th March 1879 Mackenzie, as M'Caul's trustee, in fulfilment of the previous arrangement with Robertson, in consideration of the sum of £300, partly paid in cash and partly representing an estimated dividend due to Robertson from M'Caul's trust-estate, assigned and conveyed to Thomson, as Robertson's factor and commissioner, the furniture in Hayfield House—Robertson, who had then returned home, signing the deed as a consenting party. The M'Cauls subsequently paid three of the yearly instalments of £50, £125 thereof being paid to Robertson himself, and £25 to Thomson as his factor and commissioner. The furniture still remained in Hayfield House after the date of this assignation.

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About the end of 1881 the marriage-contract trustees advanced £600 of the trust-funds to Mr and Mrs M'Caul, obtaining in return a bond and assignation in security of a policy for £700 over M'Caul's life.

In June 1882 the M'Cauls left Hayfield, which was then let by the trustees to a tenant for one year. M'Caul received the rent paid for this period, and none of it was claimed by Thomson in respect of the purchase of the furniture.

On 7th November 1882 Robertson recalled the factory and commission in favour of Thomson. On an accounting between them at that date the former was due to the latter the sum of £160, 17s. 8d.

On 15th November M'Caul's estates were sequestrated, and James Affleck, C.A., was appointed his trustee. On 27th November Robertson's estates were likewise sequestrated, and William Albert Davis, accountant, appointed trustee.

The furniture being then claimed by Thomson and by Affleck, the present action of multiplepoinding was brought in name of the marriage-contract trustees, the real raiser being Thomson, Affleck and Robertson's trustee, Davis, being also called as defenders.

Thomson lodged a claim in the following terms:—“The said Laurence Thomson claims the subject in medio to the intent and effect of recovering payment of the said debt due by the said James Robertson as aforesaid, and hereby undertakes to pay the free balance or hand over the furniture unsold after his said debt, with expenses, is satisfied, to the claimant who may be found entitled thereto: Or, in the event of the furniture being sold by order of the Court or arrangement of parties, the said Laurence Thomson claims preferably therefrom the amount of the said debt, with expenses.”

He pleaded —“The said Laurence Thomson being vested in the said subject in medio, and the said James Robertson being indebted to him as condescended on, and being now bankrupt, the said Laurence Thomson is entitled to be ranked and preferred to the extent of the said debt due by the said James Robertson to him, with expenses.”

Affleck claimed the furniture as the property of M'Caul at the time of his sequestration, and pleaded —“(1) The said furniture being the property of the said James Sloane M'Caul, and his estates having been sequestrated under the Bankruptcy Statutes, and the claimant appointed judicial factor thereon, the claimant is entitled to be preferred to the said fund in medio. (2) Separatim, the said furniture having all along remained and been in the possession, use, and enjoyment of the said James Sloane M'Caul, is in law held to be his property, and so to fall under the said sequestration, and the claimant, as the judicial factor foresaid, is entitled to be preferred to the same.” “(1) The said Walter Mackenzie not having completed his title to the furniture forming the fund in medio the assignation by him to the claimant is inept, and the claim falls to be dismissed with expenses. (2) Separatim, the said Laurence Thomson not having acquired the said furniture by a bona fide purchase, his claim ought to be dismissed with expenses. (3) Esto, that the said Laurence Thomson acquired the said furniture from the said Walter Mackenzie by virtue of the assignation founded on, the said assignation not having been followed by delivery and possession, the same is inept, and the claim ought to be dismissed with expenses.”

Davis also claimed the furniture as having been purchased by Robertson, and falling under this sequestration.

The trustees also lodged a claim, pleading a right of retention over the furniture as the property of M'Caul in security of their advance of £600.

The Sheriff-Substitute ( Gebbie), after findings in conformity with the admitted facts, found in law “that the furniture was the property of James Sloane M'Caul, and was carried by his sequestration, and now belongs to his trustee: Therefore ranks and prefers the claimant James Affleck to the fund in medio: Repels the claims for the marriage-contract trustees and Laurence Thomson.”

“ Note.—… It appears to me that the true legal position of the M'Cauls under their letter of obligation was that they were purchasers of the furniture at a specific price, payable in certain instalments. There is nothing in its tenor to indicate that it is of the nature of a lease except it be the terms of payment, which are just as commonly used in other transactions; on the contrary, the terms used in reference to the payment of the instalments ‘until the advance, with periodical interest at 5 per cent, per annum on the balance shall be repaid,’ exclude the idea of a lease, and unequivocally point to that of sale. It is simply a sale with delivery to the purchasers, who have paid only part of the price, otherwise it is to be regarded as an attempt to create a security over moveables which cannot be, at least has not competently been, done. On the assumption that the opinion expressed is the true one, it follows that the trustee must take all the interest M'Caul had in the subject in medio.”…

Thomson appealed to the Court of Session.

Authorities— Robertsons v. M'lntyre, March 17, 1882, 9 R. 772; Orr's Trustees v. Tullis, July 2, 1870, 8 Macph. 936; Anderson v. Buchanan, December 22, 1848, 11 D. 270; North British Railway Company v. White and Others, November 16, 1882, ante, p. 129.

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