Scottish Court of Session Decisions

Mains & M'Glashan, silk and woollen yarn

Page: 274↓

merchants, Glasgow, raised an action in the Sheriff Court at Paisley, under the Debts Recovery (Scotland) Act, 1867, against James Black, draper, Paisley, for payment of £28, 5s. as due for a trade debt.

The defender admitted that the debt had been due, but pleaded that the pursuers were barred from suing for the whole sum in respect that Mr T. Mains, one of the partners of the pursuers' firm, had attended a meeting of the defender's creditors upon March 23, 1891, and at that meeting had agreed upon the part of his firm to accept a composition arrangement proposed by the defender of 15s. in the £.

Proof was allowed, the result of the evidence being as follows:—It appeared that Mr M'Glashan had usually charge of the defender's account, but that he was away from home at the time of the meeting of creditors, and that Mr T. Mains attended. Mr Mains received no special authority from M'Glashan to attend the meeting or agree to a composition arrangement, but he took a prominent part in the meeting, assented to the composition arrangement, and congratulated Black upon the satisfactory ending of the meeting. On being informed of the arrangement which had been made, M'Glashan refused to consent to it. All the creditors, with the exception of the pursuers, acceded in writing to the composition arrangement.

Upon July 10, 1891, the Sheriff-Substitute ( Cowan) pronounced this interlocutor—“Finds in fact that the pursuers concurred in an arrangement by which the defender's creditors agreed to accept a composition of 15s. per £ on their debts, payable at three, six, nine, and twelve months: Finds in law that they are precluded thereby from demanding full payment of their debt. Therefore dismisses the action as laid, and decerns, &c.

The pursuers appealed, and on July 21th the Sheriff ( Cheyne) pronounced this interlocutor—“Recals the Sheriff-Substitute's interlocutor, of date 10th inst.: Finds in fact (1) that the correctness of the pursuers' account is admitted; (2) that the defence is that the action is precluded by the alleged fact that the pursuers at a meeting of the defender's creditors, held on 23rd March last, agreed to accept a composition of 15s. in the £, payable in four instalments at three, six, nine, and twelve months, then offered by the defender; and (3) that the fact upon which the defence rests has not been established, and, as the legal result of these findings, repels the defences, and decerns against the defender for payment to the pursuer of the sum of £28, 5s. sterling, &c.”

“ Opinion.— … But the creditor here is not Mr Mains, but the firm of which he is a partner, and accordingly the question arises whether his actings at the meeting bind the firm? Now, according to my understanding of the law, the compromise of a debt like the entering into a submission is outwith the ordinary implied mandate of a partner, and if that be a sound view, then the firm cannot be held to be bound here, unless it is shown that express authority to compromise existed previously, or was given at the time. [ The Sheriff then examined the facts]. So far therefore as the evidence goes it is quite possible that Mr M'Glashan was entirely ignorant about the meeting until the result of it was reported to him by Mr Mains, when he at once took up the position to which he has adhered, that he would not concur in the arrangement recommended by the meeting. In these circumstances I am, somewhat reluctantly I own, forced to the conclusion that the pursuers have not been proved to have accepted the composition offer, and are consequently entitled to decree.”

The defender appealed. Authorities—Bell's Comm. (7th ed.), 393, 398; Anderson v. Sturky, Fletcher, & Company, March 2, 1813, F.C.

At advising—