Scottish Court of Session Decisions

By trust-disposition and settlement dated 15th September 1894 John Campbell, solicitor, Edinburgh, disponed and assigned out of his means and estate belonging to him at the date of his death, to the trustees therein named, a house situated at 4 Argyle Terrace, Edinburgh, and the sum of £5000 in trust for the ends, uses, and purposes therein mentioned.

On 30th September 1897 John Campbell died intestate so far as regards the remainder of his estate. He left moveable estate of the nett amount of £10,555, 10s. 6d., besides heritable property. The moveable estate was invested in the stocks of the North British and Mercantile Insurance Company and Scottish banks and railways to the amount of £8000 or thereby. The remainder of the moveable estate consisted of accounts, furniture, &c., and of shares in various companies.

For the purpose of winding-up the estate James Campbell, Glasgow, was decerned his executor-dative, and was duly confirmed as such conform to testament-dative in his favour granted by the Sheriff of the Lothians and Peebles at Edinburgh, dated 3rd November 1897.

On 12th November 1897 the executor-dative paid to the trustees under the partial settlement £2300 to account of the sums payable under the deed, and this sum was on that date invested in heritable security at 3 per cent.

Various questions arose in regard to the winding-up of Mr Campbell's estate, and in order to decide these questions a special case was presented to the Court in February 1898 by (1) the executor-dative, (2) the trustees, (3) the heir-at-law in heritage, and (4) the heirs in mobilibus. The questions at law included, inter alia, the following:— “(2) From what date are the trustees under said partial settlement entitled to interest on said sum of £5000, and at what rate?”

In the special case it was stated that the average rate of interest received from the money invested in the stocks of the North British Mercantile Insurance Company and Scottish banks and railways from the date of the death to the dates of realisation thereof was about 3 1 2 per cent., that the whole shares were in course of realisation and the proceeds (other than the £2300 paid as aforesaid) had been deposited in bank, and that the sums so deposited amounted at the date of the special case to £4100, and on these sums only interest at the deposit rate of 1 1 2 per cent. was received.

Argued for first and fourth parties—No interest was due, or at all events, a smaller rate of interest than 5 per cent. There was no inflexible rule in the matter, and no mora had been alleged against the trustees— Inglis' Trustees v. Breen, February 6, 1891, 18 R. 487.

Argued for second parties—The £5000 was payable with interest at 5 per cent. from the date of Mr Campbell's death. The fixed rule was that legal interest at 5 per cent. was due from the time a sum became payable till it was paid, and the Court would not lower this rate except in special circumstances— Kirkpatrick v. Bedford, November 15, 1878, 6 R. (H. L.), per Lord Chancellor Cairns, 7.