Scottish Court of Session Decisions

Subject_1 HERITABLE and MOVEABLE.
Subject_2 SECT. XIII.

Effect of the death of debtor or creditor before the term of payment, in cases of bonds heritable by clause of infeftment.

Gordon
v.
Ker

1683. November.
Case No. No 79.

Where the obligation in a bond to infeft is pure, and to have present effect, and not adjected as a failzie in case of not payment, the bond is heritable a principio, as to all effects.

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Andrew Ker having granted bond to Robert Balfour for the sum of L. 1000 bearing an obligement to infeft the said Robert Balfour, in an yearly annualrent out of certain lands for security of the sum, and a personal obligement to pay the same without requisition, and Robert Balfour, the said Andrew's heir, having assigned the bond to Mr William Gordon advocate, and he having pursued Andrew for payment; alleged for the defender, That Robert Balfour the pursuer's cedent, having assigned the same to James Melvil for a debt due to him, the same became extinct by compensation. Answered, That the bond bearing an obligement to infeft, was heritable, and the assignation being granted to Melvil upon death-bed, was null and could not be sustained in prejudice of the pursuer's cedent, who was heir. Replied, That albeit the bond was heritable by destination, yet the creditor having died before the term of payment, the sum was moveable, and so might have been assigned on death-bed, or disposed upon by testament, as in the case of bonds bearing annualrent, granted before the act of Parliament 1661; which albeit they were heritable in their own nature, yet if the creditor died before the term of payment they became moveable, as is clear by several decisions, and particularly Anderson against Anderson, No 78. p. 5513, and the 29th of June 1624, Smith against Anderson's Relict, No 69. p. 5503; and the 13th June 1627, Nicolson against Lyell,* where a bond, bearing an obligement to infeft, was found to belong to a husband jure mariti, and did fall to his executors, he having deceased before the term of payment. Duplied, That there is a great difference betwixt bonds bearing obligement to infeft, which are heritable ab initio, and of their own nature, and bonds bearing annualrent, which are only heritable after the term of payment of the annualrent, in which case the bonds being moveable before the term of payment, the sum belongs to the creditor's executors; whereas in the other case, the bond being heritable by destination ab initio, albeit the creditors die before the term of payment, yet the same belongs to his heir in respect of the obligement in the bond to infeft. And Smith against Anderson's Relict, doth not meet this case; because in that case, the bond did bear an obligement to make payment of the sum at a certain term, and failing thereof to infeft; in which case the sum was found moveable before the term of payment, which vastly differs from the case of a bond bearing an obligement to infeft ab initio before the term of payment, which makes the sum heritable. The Lords found the sum heritable ab initio, in respect of the obligement to infeft, and that the creditor dying before the term of payment, could not assign the same upon death-bed in prejudice of his heir; and therefore preferred Mr William Gordon the pursuer to the sum.

Fol. Dic. v. 1. p. 370. Sir P. Home, MS. v. 1. No 474.

* Voce Husband and Wife.

*** P. Falconer reports the same ease:

Mr William Gordon, as assignee constituted by Andrew Balfour, heir to Robert Balfour, in and to a bond granted by Andrew Ker to Robert Balfour, (for security of which sum, Andrew was obliged to infeft his creditor in an annualrent forth of his tenement in Edinburgh,) did intent action against the heir of the said Andrew Ker for payment. It was alleged, That this sum was moveable, the creditor having died before the first term's payment of the annualrent, and that the defunct had assigned the same in favours of Andrew Melvil, to whom Ker was creditor, and so had ground of compensation. It was answered for Mr William Gordon, That this bond was heritable ab initio, seeing it bore an obligement to infeft before the term of payment, and consequently he, as assignee from the heir, was preferable to any assignation made thereof on death-bed by the defunct; and that albeit bonds, which were only heritable by a destination for payment of annualrent, were moveable before the term of payment, yet bonds bearing an obligement to infeft, were heritable ab initio, as was clear by the decision 15th July 1623, Anderson contra Anderson, No 78. p. 5513.; and the decision, Smith against Auderson's Rclict, No 69. p. 5503. is only where the bond bore an obligement to make payment at a certain term, and failing thereof, to infeft; in which case, the sum was found moveable before the term of payment only. The Lords preferred Mr William Gordon, and found the bond heritable ab initie, although before the term of payment the creditor was deceast.

P. Falconer, No 73. p. 48. *** Fountainhall also reports this case:

A cause pursued by Mr William Gordon advocate contra Ker and Balfour, was reported by Forret: The debate was upon an heritable bond bearing obligement to infeft; the creditor dies before the term of payment of the annualrent, no infeftment having been taken on it; it was contended, That this sum was moveable before the term of payment, (as in other bonds only heritable by a clause of annualrent,) and so fell to his executors, seeing it did not begin to be heritable till the elapsing of the term, and that the obligement to infeft preceded the personal clause for paying the annualrent; and cited a decision in Durie, 15th June 1627, Nicolson contra Lyle, voce Husband and Wife, where an heritable sum before the term of payment was found moveable; and such a sum as this by the 51st act of Parliament 1661, is arrestable before infeftment. But this is by virtue of that statute only. Yet the Lords found no difficulty in this case, but unanimously determined it to be heritable, a primo momento it was subscribed; like a bond payable to one's heirs and assignees, secluding his executors; as being the party's express meaning and design to have such sums heritable ab initio; whereas in the other cases, it is only the payment of the annualrent, and its term being come, that makes it to be reputed an heritable right; because of old before the reformation, annui redditus, our annualrents by infeftment, were (to elude and evacuate the canon law prohibiting usury,) only constituted by sasines out of lands.

Fountainhall, v. 1. p. 251. *** This case is also reported by Harcase:

Found that bonds bearing an obligement to infeft are heritable ab initio, even from the very date, though the creditor die before the term of payment; and therefore that such could not be disponed in lecto.

Harcarse, (Bonds.) No 190. p. 43.

*** In conformity with the above was decided the case of Stewart of Pardovan against Stewart of Torrence, 26th June 1705, No 14. p. 140, No 41. p. 703. and, No 15. p. 2767.