BAILII is celebrating 24 years of free online access to the law! Would you consider making a contribution?

No donation is too small. If every visitor before 31 December gives just £1, it will have a significant impact on BAILII's ability to continue providing free access to the law.
Thank you very much for your support!



BAILII [Home] [Databases] [World Law] [Multidatabase Search] [Help] [Feedback]

Scottish Sheriff Court Decisions


You are here: BAILII >> Databases >> Scottish Sheriff Court Decisions >> Lavery v. Lavery [2008] ScotSC 5 (07 February 2008)
URL: http://www.bailii.org/scot/cases/ScotSC/2008/5.html
Cite as: [2008] ScotSC 5

[New search] [Help]


SHERIFFDOM OF GRAMPIAN HIGHLAND AND ISLANDS AT ABERDEEN

 

A2395/06

JUDGEMENT

 

of

 

SHERIFF PRINCIPAL SIR STEPHEN S T YOUNG Bt QC

 

in the cause

 

LOUISE LAVERY

 

Pursuer and Respondent

 

against

 

DAVID ALAN LAVERY

 

Defender and Appellant

 

 

 

 

 

Act: Mr P G Davies, advocate, instructed by Solicitors Direct, Aberdeen

Alt: Mr M A Stuart, advocate, instructed by George Mathers & Co, Aberdeen

 

 

Aberdeen: 7th February 2008

 

The sheriff principal, having resumed consideration of the cause, refuses the appeal and adheres to the interlocutor of the sheriff dated 27 September 2007 under deletion of the words: "APPOINTS the cause to a hearing on 24 October 2007 in order to determine further procedure; RESERVES all questions of expenses until said date"; finds the defender and appellant liable to the pursuer and respondent in the expenses of the appeal and of the debate before the sheriff and allows an account thereof to be given in and remits the same when lodged to the auditor of court to tax and to report; certifies the appeal as suitable for the employment by the pursuer and respondent of junior counsel; quoad ultra remits the cause to the sheriff to proceed as accords.

 

 

 

 

Note

 

Background

 

[1] In this case the pursuer and respondent is the executrix-dative of her mother ("Mrs Lavery") who died on 1 April 2005. Mrs Lavery and the defender and appellant were husband and wife, having been married on 7 March 1970. In 1998 they purchased a heritable property at 7 Garden Court, Centre Point, Bridge of Don, Aberdeen. The disposition in their favour is dated 22 October 1998 and it recorded that the price of the property was paid to the seller by the defender and Mrs Lavery. The property was disponed to them "equally between them and to the survivor of them", and this is reflected in the proprietorship section of the Land Certificate Title No. ABN26532 which was issued following registration on 2 November 1998.

 

[2] On or about 9 July 2000 Mrs Lavery and the defender separated. They subsequently entered into a minute of agreement upon the narrative that they wished "to regulate the financial aspects arising from their separation". This was dated 14 and 19 October 2004 and was registered in the Books of Council and Session on 6 December 2004. It contained fifteen clauses which were as follows:

 

FIRST Mr Lavery shall convey to Mrs Lavery his whole right, title and interest in and to the former matrimonial home at 7 Centre Point, Bridge of Don, Aberdeen and shall deliver a validly executed Disposition, a validly executed Renunciation of any or all rights available to her under the Matrimonial Homes (Family Protection) (Scotland) Act 1981 (as amended) in respect of the former matrimonial home and a Form 10 report in terms of the Land Registration (Scotland) Act, 1979 brought down to a date as near as practicable to the date of settlement and showing no entries adverse to her interest all of which shall be completed as soon as reasonably practicable, but in any event, not less than four weeks from the date or dates hereof (hereinafter referred to as the "date of settlement".) Solicitors Direct will carry out the conveyancing in respect of the transfer, and their fees and outlays shall be borne by Mrs Lavery.

 

SECOND In exchange for the disposition, Renunciation and clear Form 10 report, Mrs Lavery shall free and relieve Mr Lavery of all obligations under the existing standard security in favour of Halifax plc over the former matrimonial home, and shall exhibit and thereafter record in the Land Register a Discharge or Deed of Variation of the Standard Security, as the case may be, in agreed terms, validly executed by the said Bank discharging Mr Lavery of all liability and obligations in respect of that standard security.

 

THIRD The house at 57 Bogie Street, Huntly (hereinafter referred to as "the said property") is in joint names of the parties and shall be exposed for sale on the open market forthwith. On a sale being achieved at a price acceptable to Mrs Lavery and on acceptable ancillary terms, both parties will co-operate fully in signing any necessary disposition and ancillary documentation and will deliver the signed disposition and documentation to the selling agents within seven days of the receipt of it for signature.

 

FOURTH Solicitors Direct, 4 Golden Square, Aberdeen or a local solicitor of Mrs Lavery's choosing shall carry out the estate agency marketing and the said Solicitors Direct will carry out the conveyancing in respect of the said property. From the proceeds of sale, the necessary sum required to redeem the mortgage secured over the property will be paid to the Bank of Scotland and all necessary estate agency and legal expenses and outlays in connection with the sale and conveyancing discharged.

 

FIFTH Mr Lavery shall convey to Mrs Lavery his whole right, title and interest in and to the two timeshare properties Barratt Leila Playa resort, Marbella, apartment numbers A11 (week 22) and B23 (week 23) at and shall validly execute any Disposition or document with similar effect provided by Mrs Lavery and shall effect same within four weeks of being provided with same.

 

SIXTH Mr Lavery will pay Mrs Lavery the sum of TWENTY ONE THOUSAND POUNDS (£21,000) within 4 weeks of the last date of signing hereof (hereinafter referred to as "the date of settlement") failing which interest shall accrue on the said sum from the said date of settlement until paid at 8% per annum.

 

SEVENTH Both parties undertake to sign all deeds or other documents necessary declaring in the event that either party refuses to sign any deed or document without due cause then the parties authorise and ordain the Sheriff Clerk at Aberdeen to subscribe said deed or document in lieu thereof to give effect to all or any of the provisions of this agreement.

 

EIGHTH Mr Lavery shall pay Mrs Lavery a sum of ONE THOUSAND POUNDS (£1000) within two months of the last date of this agreement in lieu of his one half share of the aliment for Louise Lavery's tertiary education, failing which interest will accrue from that date to the date of payment at the amount of 8% per annum.

 

NINTH The furniture, plenishings and whole contents within the former matrimonial home, together with any other moveable assets owned by the parties, have been divided by mutual agreement and both parties hereby acknowledge that they have received a fair share of the said contents, furniture, plenishings and other moveable assets and discharge any rights that they may have in any furniture and plenishings retained by the other party.

 

TENTH In implementation of the foregoing, both parties renounce and discharge all and any rights that they have or may have against the other or against the executor or assignees of the other now or in all time coming to any capital sum, property transfer order, or periodical allowance of whatsoever nature, whether under common law or statute, either on death or divorce and without prejudice to the foregoing generality, any claim in terms of the Divorce (Scotland) Act 1976 or any re-enactment thereof, or in terms of the Family Law (Scotland) Act 1985 or any re-enactment thereof.

 

ELEVENTH Both parties hereby renounce and discharge for all time coming his or her legal right of jus relictae or jus relicti and also any prior rights and such other rights of succession which may arise on the death of the other party under the Succession (Scotland) Act 1964 or any amendment thereof or at common law.

 

TWELFTH On any subsequent divorce between the parties, the terms of the said divorce action shall be in line with the provisions of this agreement. Either party may apply for divorce on the ground of two years separation and the other party will not withhold their consent to the divorce as long as the party applying for divorce does not seek an award of expenses against the other party.

 

THIRTEENTH Each party shall be responsible for his or her own legal expenses and outlays in connection with the negotiation, preparation, execution and registration of this agreement.

 

FOURTEENTH Both parties, by their signatures hereto, acknowledge that they have received the opportunity to seek independent legal advice in relation to the terms of these presents and they accept the terms of this agreement to be fair and reasonable.

 

LASTLY The parties consent to the registration of this agreement in the Books of Council and Session for preservation and execution.

 

[3] In implement of clause 1 of the minute of agreement solicitors prepared a disposition of the former matrimonial home by Mrs Lavery and the defender in favour of Mrs Lavery alone. The defender then signed this but Mrs Lavery died before she had signed it. As a result of her death it could no longer be registered and it is accepted that in consequence of the survivorship clause the title to the whole property became vested in the defender. The pursuer subsequently called upon the defender to implement the minute of agreement by conveying the whole property to the pursuer. This he evidently refused to do. In these circumstances the pursuer raised the present action.

 

[4] In terms of crave 1 the pursuer craves the court to ordain the defender to implement clause 1 of the minute of agreement by executing and delivering to her a valid disposition in her favour of the property and such other deeds as may be necessary to give her a valid title to it in exchange for a discharge or deed of variation of the standard security over the property relieving the defender of all obligations under this. The defender's response has been to say that at the date of the minute of agreement he owned a one-half pro indiviso share of the property and that the extent of his obligation under clause 1 is to convey that interest alone to the pursuer, subject to being relieved by her of his liability to the heritable creditors.

 

[5] In due course a debate took place before the sheriff on the first plea-in-law for the pursuer and the first and fourth pleas-in-law for the defender. The pursuer's plea-in-law reads:

 

1.                       The defender being obliged to implement the minute of minute of agreement by granting a disposition of the subjects in favour of the pursuer as condescended upon, decree for implement should be granted as first craved.

 

The defender's pleas-in-law read as follows:

 

1.                       The pursuer's averments being irrelevant et separatim lacking in specification the action should be dismissed.

 

4. The defender not being obliged to grant a disposition in the terms referred to in the first crave, decree of absolvitor should be pronounced.

 

The sheriff's decision

 

[6] By interlocutor dated 27 September 2007 the sheriff sustained the pursuer's first plea-in-law, repelled the first and fourth pleas-in-law for the defender and granted decree in favour of the pursuer in terms of crave 1. It is this interlocutor which is the subject of the present appeal.

 

[7] In support of his interlocutor the sheriff wrote a detailed and careful note in which he set out the parties' respective submissions and then explained his decision. This speaks for itself, and it is unnecessary to repeat it here. In short, his conclusion was that the effect of clause 1 of the minute of agreement was that the defender was obliged to convey to Mrs Lavery not only his one-half pro indiviso share in the property but also his contingent right to succeed to Mrs Lavery's share in the event that she died before him. Thus at paragraph [52] the sheriff wrote:

 

Considering the terms of the whole Minute of agreement, it seems to me that the intention of parties is clear and that the use of the words "whole right, title and interest" in Clause FIRST intends to convey all the defender's rights in the property, that is not only his own one half pro indiviso share but also his rights in the survivorship destination. Had Clause FIRST stated that the defender would convey to his wife his one half pro indiviso share together with his whole right, title and interest (as in Gardner's Trustees v Raeburn (supra)) then the situation in my view would be completely different because that would demonstrate that the defender intended to reserve the survivorship destination.

 

Parties' submissions

 

[8] Opening the appeal, counsel for the defender acknowledged that it raised a short point, namely whether upon a true construction of the minute of agreement the defender's obligation under clause 1 was to convey to Mrs Lavery both his existing one-half pro indiviso share in the property and his right to succeed to her share in the event of her pre-deceasing him or whether on the other hand he was obliged only to transfer his existing share to her. Counsel submitted that the second of these alternatives was correct and that the defender's right under the survivorship destination was not included in the expression "whole right, title and interest" in clause 1. Under reference to Erskine's Institute II.vii.2, Craigie's Conveyancing - Heritable Rights at page 126 and Gardner's Executors v Raeburn 1996 SLT 745 counsel submitted that the expression "whole right, title and interest" referred only to lesser or subordinate heritable or real rights in the property in question which fortified the title to it and were transmitted with it. The expression did not include a right under a survivorship destination which had the character of a contractual right between the disponees and did not transmit with the heritable property in the same way as would a real right. Counsel submitted that the argument for the pursuer received no support from the remaining clauses in the minute of agreement and there was nothing in these clauses to suggest that the expression "whole right, title and interest" should be given anything other than its normal meaning as set out in the passage in Erskine to which he had referred. If, from the pursuer's point of view, an error had been made, this had been in the drafting of the minute of agreement and it was not for the court to try and rescue the pursuer from a bad bargain. Under reference to the Scottish Law Gazette 2006 Vol. 74, No. 1 at pages 12/13 and Rennie: Solicitors' Negligence at paragraph 6.15 it was submitted that the error had been that of the pursuer's advisers who had failed to evacuate the survivorship destination in the minute of agreement with the result that, following the death of Mrs Lavery, the defender was now vested in both one-half pro indiviso shares in the property. It was accepted that he was under an obligation to transfer to the pursuer the share which he had taken under the original disposition in favour of Mrs Lavery and himself. But he was not obliged to transfer to the pursuer the share which he had received upon the death of Mrs Lavery. The appeal should therefore be sustained, the sheriff's interlocutor dated 27 September 2007 recalled and the cause remitted to the sheriff to proceed as accords.

 

[9] In response, counsel for the pursuer submitted that I should refuse the appeal and adhere to the interlocutor of the sheriff who had reached the correct conclusion on the issue debated before him. Counsel submitted that it was clear from the terms of the minute of agreement as a whole that its purpose was to separate the affairs of Mrs Lavery and the defender following their separation. The expression "whole right, title and interest" in clause 1 conveyed to the reader that the defender was to transfer to Mrs Lavery all his rights in the property. The expression was not qualified by a reference to his existing one-half pro indiviso share in the property, nor was any other description given in the clause of the nature of his rights in the property. In these circumstances the expression covered both his existing one-half pro indiviso share and also his right to succeed to Mrs Lavery's share in the event of her pre-deceasing him. Counsel then drew attention in particular to clauses 2, 7, 10, 11 and 14 and submitted that an examination of the minute of agreement as a whole reinforced the view that the intention of clause 1 was that the defender should give up any right that he might have in the property. Counsel acknowledged that the expression "whole right, title and interest" commonly appeared in a disposition and he suggested that it might be that a different approach should be taken where it appeared in missives. But on any view it included all lesser rights in a property including the right to succeed under a survivorship destination which had the character of a real or heritable right. If it had been intended that the defender should retain his right under the survivorship destination, one would have expected to have seen in the minute of agreement an express provision to this effect. Under reference to Fleming's Trustee v Fleming 2000 SC 206 counsel accepted that the minute of agreement of itself was not sufficient to evacuate the survivorship destination and that what was required was a deed recorded in the Land Register. Turning to the significance of Mrs Lavery's death, counsel emphasised that it had been accepted by the defender that this did not affect the enforceability of the minute of agreement. The effect of Mrs Lavery's death had been that her half share in the property had been automatically vested in the defender and in order to implement the terms of clause 1, in other words to convey his whole right, title and interest in the property, he now had to grant a disposition of the whole property to the pursuer as executrix of Mrs Lavery. This would achieve the result that would have been achieved if the disposition prepared following the execution of the minute of agreement had been signed not only by the defender but also by Mrs Lavery and recorded before her death.

 

Decision

 

[10] The critical question here is what is meant by the expression "whole right, title and interest" in clause 1 of the minute of agreement. In answering this, it is I think important to bear in mind that this expression is used, not in a disposition of heritable property, but in a contract between two private individuals and that the ordinary principles of construction of contracts apply. In particular, the contract should be construed as a whole, and regard may be had to be the admissible surrounding circumstances. In the present case the circumstance that matters above all is that, when the minute of agreement was executed, the title to the property was held in the name of Mrs Lavery and the defender "equally between them and the survivor of them". In other words, each of them had a one half pro indiviso share in the property and a contingent right in terms of the survivorship destination to succeed to the other's share. It is not in dispute that this survivorship destination, being contractual in character, could only be evacuated by the joint consent of the parties - Perrett's Trustees v Perrett 1909 SC 522 and Shand's Trustees v Shand's Trustees 1966 SC 178 - and that for this purpose what was required was a deed recorded in the Land Register - see Fleming's Trustee v Fleming. While it may have indicated what the parties had intended should happen, the minute of agreement was thus not of itself sufficient to evacuate the survivorship destination.

 

[11] The expression "whole right, title and interest" in clause 1 begs the question what was the defender's right, title and interest in and to the former matrimonial home. As already indicated, it consisted of two parts, namely a title to a one half pro indiviso share of the property and a contingent right under the survivorship destination to succeed to Mrs Lavery's share in the event that he survived her. This contingent right was capable of being transferred to a third party no less than the defender's one half pro indiviso share - see Trappes v Meredith 1871 10 M 38 - and in my opinion it is plain, in particular when regard is add to the word "whole", that the effect of clause 1 was that the defender became bound to transfer to Mrs Lavery both his one half pro indiviso share in the property and his contingent right under the survivorship destination so that he was thereafter denuded of any right, title or interest in and to the property. For if, as the defender maintained, his obligation had only been to transfer to Mrs Lavery his one half pro indiviso share, then he would manifestly not have transferred to her his whole right, title and interest in and to the property.

 

[12] That this is the correct construction is I think confirmed by a consideration of the terms of the minute of agreement as a whole. As the opening narrative indicates, its purpose was to regulate the financial aspects arising from the party's separation and it seems to me to be plain that the overall import of its provisions was, as might be expected in the current state of the law, to achieve a clean break between the parties' respective financial affairs so that thereafter neither party any longer had any interest in the affairs of the other. If this be correct, then it might be thought extraordinary that, as the defender maintained, the effect of the minute of agreement should nonetheless have been that he should have retained the right to succeed to Mrs Lavery's one half pro indiviso share in the event that he survived her.

 

[13] Counsel for the defender relied strongly on the decision of Lord Cullen in Gardner's Executors v Raeburn. In that case a husband and wife were granted a disposition of a house in 1984 "equally between them and to the survivor". They separated in 1985 and later divorced. In 1985 the wife disponed her one half pro indiviso share in the house to the husband together with her "whole right, title and interest, present and future in and to the said subjects". The husband did not evacuate the special destination in the original disposition during his lifetime nor did the parties dispose of their respective shares to him alone. Following his death in 1991 his executors brought an action against the wife, claiming that the later disposition had counteracted or cancelled the operation of the survivorship clause in respect of the husband's one half pro indiviso share. For the pursuers it was submitted that the words "my whole right, title and interest, present and future in and to the said subjects and others" covered any contingent right which the defender enjoyed in respect of the deceased's one half pro indiviso share. For the defender it was submitted that the expression did not convey any additional heritable subject and did no more than fortify the title to the property which was being conveyed, namely the defender's one half pro indiviso share. At pages 746K/747A Lord Cullen stated:

 

I consider that the submissions for the defender are well founded. The meaning which is given to a clause in such terms is well established, and it was common ground that in the ordinary case it did nothing more than fortify what had earlier been conveyed. I am unable to give the wording as it appears in the present case a significance which is different from the normal and which would cover the disponer's interest in a different subject. I do not accept the argument based on the scope of the expression "the said subjects". This disposition shows evidence of an unhappy attempt to apply language which would be appropriate for a disposition of the whole of a heritable property to a disposition of a one half pro indiviso share without proper adaptation of the language.

 

[14] In my opinion the circumstances of Gardner's Executors v Raeburn are readily distinguishable from those of the present case. The issue in that case was what was meant by the expression "whole right, title and interest" in the context of a disposition of a one half pro indiviso share of the property in question. By contrast in the present case what clause 1 says is, not that the defender shall convey to Mrs Lavery his whole right, title and interest in and to his one half pro indiviso share in the former matrimonial home, but that he shall convey to her his whole right, title and interest in and to the property. So the question once again comes to be what was his whole right, title and interest in and to this property when the minute of agreement was executed. As already indicated, it consisted of two parts and together these two parts made up the whole which he was obliged to convey to Mrs Lavery.

 

[15] It is true of course that of as a result of Mrs Lavery's death, the defender's contingent right to succeed to her half pro indiviso share has in effect been converted into a vested right to this share so that he is now vested in what were previously two distinct shares in the property. In other words, the character of his whole right, title and interest in and to the property has changed as a result of Mrs Lavery's death. But his obligation to convey his whole right, title and interest to the pursuer as executrix-dative of Mrs Lavery remains, and in order to implement this obligation he must in my opinion now execute and deliver to the pursuer of a disposition of the whole property.

 

[16] It was also submitted for the pursuer that, in the event that the meaning of the expression "whole right, title and interest" in clause 1 was thought to be ambiguous, it would be legitimate to have regard to the fact that, following the execution of the minute of agreement, the defender had signed the disposition which had subsequently been prepared. The fact that he had done this was, so it was said, an indication that the parties' intention had been to clear out the survivorship clause in implement of the minute of agreement. Reference here was made to Scottish Residential Estates Development Co Ltd v Henderson 1991 SLT 490, Cameron (Scotland) Ltd v Melville Dundas Ltd 2001 SCLR 691, Ballast plc v Laurieston Properties Ltd 2005 CSOH 16 and Westbury Estates Ltd v The Royal Bank of Scotland plc 2006 CSOH 117. This alternative contention was disputed by counsel for the defender. Since I do not myself think that the expression "whole right, title and interest" in clause 1 is ambiguous, it is unnecessary that I should express any opinion on it.

 

[17] On the whole matter I am persuaded that the sheriff reached the right conclusion following the debate. I have therefore refused the appeal.

 

[18] In addition to the authorities which I have already mentioned, I was also referred to Love v Storie 1863 2 M 22, Professor J. M. Halliday's Conveyancing Opinions at pages 636/7, McBryde on Contract (3rd Edn) at paragraphs 8 - 05 et seq, Trayner's Latin Maxims (4th Edn) at page 583 and Redfern's Executors v Redfern 1996 SLT 900.

 

[19] It was agreed that, if the appeal were refused, the defender should be found liable to the pursuer in the expenses of both the appeal itself and the debate before the sheriff. It was also agreed that the appeal should be certified as suitable for the employment by the pursuer of junior counsel.


BAILII:
Copyright Policy | Disclaimers | Privacy Policy | Feedback | Donate to BAILII
URL: http://www.bailii.org/scot/cases/ScotSC/2008/5.html