Scottish Court of Session Decisions

This was an action of multiplepoinding brought by John Douglas, farmer in Falhar, in the county of Wigtown, and proprietor of certain heritable subjects in the burgh of Wigtown. The object of the action was to settle a question which had arisen regarding a certain debt secured over his property. This question arose under the following circumstances:—

In 1853 the deceased James Brown, mason in Wigtown, then proprietor of these subjects, granted a bond and disposition in security for £100 over them in favour of the late William Carson, writer in Wigtown. In 1866 the subjects were acquired by John Douglas, the present nominal raiser, but under burden of this heritable security. By disposition and assignation, dated 22d June 1870, Mr Carson, in consideration of the sum of £700 paid and advanced for him by Robert M'William, S.S.C., one of the claimants in this action, residing in Edinburgh, “sold, alienated, assigned, disponed, conveyed, and made over” to the said Robert M'William, and his heirs and assignees whomsoever, heritably and irredeemably, various subjects, heritable and moveable, and, inter alia, the subjects contained in the said bond and disposition in security by Brown in his (Carson's) favour, “and that in real security to the said Robert M'William of the sum of £100 sterling, interest and penalty, borrowed by James Brown, mason and housebuilder in Wigtown, proprietor of said subjects, from me, the said William Carson, conform to bond and disposition in security, dated 11th July 1853, and recorded in the Register of Sasines for the burgh of Wigtown 19th November 1855.” The subjects so disponed in security were held feu. This disposition and assignation contained an assignation of all right, title, and interest which the said William Carson had to the whole subjects “severally above described and hereby disponed,”—a clause of warrandice and an assignation of writs which, as the deed bore, were delivered “according to inventory, so far as in my possession.” The inventory was signed of even date with the said disposition and assignation, and relative thereto. No. 10 of that inventory was “copy bond and disposition in security by James Brown to William Carson, dated 11th July 1853, recorded in Register of Sasines for burgh of Wigtown 19th November 1855.” M'William expede an instrument of sasine on this conveyance in his favour,

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in which he included, inter alia, the subjects contained in the bond and disposition in security by Brown to Carson, and recorded it in the Register of Sasines for the burgh of Wigtown on 11th March 1872. In March 1873 the estates of Mr Carson (who had died on 23d November 1871) were sequestrated, and Alexander M'Cutcheon, banker in Newton-Stewart, the real raiser and only other claimant, was appointed trustee. On the assumption that M'William had not a valid assignation to the bond by Brown to Carson, he completed a title to it in his own favour as trustee, and now claimed to be vested in the security. The principal objection taken by him to the title of M'William was that the disposition and assignation by Carson had not conveyed to him the debt, and was disconform to the statutory enactments respecting the transmission of heritable securities. But he also maintained that M'William's infeftment was null, in respect that while the subjects disponed in security were held feu, the instrument of sasine in his favour had been recorded in the Burgh Register of Sasines.

It would appear that at the time when the assignation was granted in favour of M'William Carson had been unable to find the original bond assigned. It was found after his death by M'Cutcheon, who proceeded to make up a title to it.

The claimant M'William pleaded that as Carson had assigned to him his whole right, title, and interest in the subjects, while the trustee was only vested in the bankrupt estate tantum et tale as it existed in the person of the bankrupt, M'Cutcheon had no good claim to the fund in medio. He also maintained that M'Cutcheon's actings upon Brown's bond, when found by him, were not bona fide.

The Lord Ordinary pronounced the following interlocutor:—

“ Edinburgh, 3d November 1875.—The Lord Ordinary having heard the counsel for the parties, and considered the closed record and whole process, Finds that the sum of £100, and interest thereon, contained in the bond and disposition in security mentioned in the summons, and the lands thereby conveyed in security thereof by James Brown, the granter of said bond, to the late William Carson, also mentioned in the summons, and forming the fund in medio in this action, were not effectually transferred to or vested in the claimant Robert M'William by the bond and assignation, of which No. 8 of process is an extract, granted by the said William Carson to the claimant Robert M'William, dated 22d June 1870, or by the instrument of sasine thereon, No. 11 of process, expede by the said Robert M'William, and recorded in the Register of Sasines: Finds that the said debt and security are now vested in and belong to the claimant Alexander M'Cutcheon, as trustee on the sequestrated estate of the said William Carson, in virtue of the act and warrant of confirmation, and of the notarial instrument expede by him, No. 33 of process: Therefore, repels the claim of the said Robert M'William: Sustains the claim of the said Alexander M'Cutcheon, and ranks and prefers him upon the fund in medio in terms of said claim, and decerns: Finds the said Robert M'William liable in expenses to the said Alexander M'Cutcheon: Appoints an account thereof to be lodged, and when lodged remits the same to the Auditor of Court to tax, and to report.

Note.—[ After narrating the facts of the case]—The sole grounds on which the trustee in the sequestration objects to the claim of Mr M'William, and himself claims the debt and security in question as part of the bankrupt estates, are—(1) That the disposition and assignation is, in consequence of defects in form, not a valid and effectual transference of the debt and security from Carson to M'William; (2) That even assuming the disposition and assignation to have been in proper form, M'William has never been validly infeft in the security, and is now excluded from claiming the debt in consequence of the trustee having completed a feudal title thereto in his own person.

1. The first question is the most important. It is, Whether Brown's security was validly transferred by Carson to M'William by the disposition and assignation already mentioned? That deed includes, as has been mentioned, several heritable subjects and other securities. It proceeds thus—‘I, William Carson, &c., in consideration of the sum of £700 sterling, paid and advanced for me by Robert M'William, S.S.C.,’ &c., ‘have sold and disponed, and hereby sell, alienate, dispone, assign, convey, and make over to the said Robert M'William, his heirs and assignees whomsoever, heritably and irredeemably. ’

‘ Sixth, All and whole that piece of ground consisting of four lots, with dwelling-houses built thereon, being part of the lands of Outer Acre’— [Here follows description]— ‘all lying in the burgh and parish of Wigtown and sheriffdom thereof, but always with and under the conditions, provisions, and stipulations mentioned in a contract of feu, dated the 21st day of March 1853, entered into between the Magistrates and Council of the burgh of Wigtown, on the one part, and the said John Adamson, on the other part, and that in real security to the said Robert M'William, of the sum of £100 sterling, interest and penalty, borrowed by James Brown, mason and house builder in Wigtown, proprietor of said subjects, from me, the said William Carson, conform to bond and disposition in security, dated 11th July 1853, and recorded in the Register of Sasines for the burgh of Wigtown, 19th November 1855.’ These words, it is maintained on the part of Carson's trustee, do not in form or in substance constitute a valid or effectual assignation to Mr M'William of the security in question. I think the trustee's contention is sound. The debt is not assigned,—the bond itself is not assigned,—and nothing in short purports to be conveyed but the subjects over which the debt is secured. There can be no doubt that the debt as well as the security was intended to be assigned; and as in a question with Carson himself or his representatives (in the absence of insolvency) M'William could have insisted upon Carson granting a valid and formal assignation of the debt, and failing that he could have adjudged the same in implement. But I do not think that the debt itself, which is not in terminis assigned, and to which the subjects are merely accessory as security, can be held to have been by implication assigned to Mr M'William in such a manner as to enable him to complete a title thereto by simply recording the disposition and assignation, or even by expeding and recording an instrument of sasine or other notarial instrument thereon.

In the first place, the assignation, neither in

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form nor in substance, follows the schedule (G G) in the ‘Titles to Land Consolidation Act 1868,’ which, substantially re-enacting the corresponding provision of the Heritable Securities Act of 1845, allowed securities which had once been constituted by infeftment to be transferred in the short form set forth in the schedule; it being declared that on such assignation being recorded in the appropriate Register of Sasines the security ‘shall be transferred to the assignee as effectually as if such security had been disponed and assigned, and the disposition and assignation or conveyance had been followed by sasine duly recorded according to the law and practice prior to the 1st day of October 1845, at the date of recording such assignation or conveyance.’ But it will be seen at a glance that the disposition and assignation in question does not conform to the schedule, in respect—(1) that it does not assign or bear to assign the bond and disposition in security itself; and (2) that even when the bond is referred to, it does not specify the names of either the granter or the grantee, all of which are particulars required by the schedule, and the failure to insert which, is, in my opinion, a fatal omission. It is only on condition of following the new statutory forms that parties are allowed to dispense with the forms in use under the older law and practice.

On the other hand, it is impossible to maintain that the security has been validly assigned in the form required by the law and practice prior to 1845. That practice required a disposition and assignation expressly assigning (1) The sum due and interest; (2) The bond and disposition in security itself; and (3) The lands in real security to the assignee of the sums, principal, and interest, &c., and containing an obligation to infeft, a procuratory of resignation, and a precept of sasine; and to complete the transference an instrument of sasine had to be expede and recorded in favour of the assignee. But there is not in the present deed any substantial adherence to the old form; and I am therefore of opinion that the security in question was not assigned by Carson to M'William in such a manner as to enable the latter to complete a feudal title thereto as assignee under any of the forms known to or recognised by the law and practice prior to 1845, or sanctioned by the statute of that year and by subsequent legislation.

But apart from these considerations, I think that Mr M'William's case must fail on more general grounds. The debt must be regarded as the principal, and the lands as merely accessory as security. It is indeed true that where a debt has been rendered heritable by being secured over land it cannot be effectually transferred so as to entitle the assignee to prevail in a competition with a subsequent adjudication or assignation completed by sasine, unless the heritable subjects, as well as the debt, are conveyed to the first assignee with a proper warrant for sasine followed timeously by infeftment— Anstruther v. Black, Morison 829. But this case gives no support to the view that the conveyance of the lands held by the cedent in security of a debt due to him by the owner of the lands will transfer the debt. On the contrary, the import of the decisions appears to me to be, that where a debt is heritably secured, and the creditor is duly infeft, the debt itself, and the subjects over which it is secured, are held to be so inseparably connected that in order effectually to assign the debt both it and the lands must be expressly conveyed by a deed adapted to convey heritable property.

It is said, however, by Mr M'William, that in virtue of the clause of ‘assignation of writs ’ contained in the disposition and assignation, the debt itself, and the bond and disposition constituting it, have, as well as the lands, been validly assigned to him. The clause is in the following terms:—And I assign the writs, and have delivered the ‘same according to inventory, so far as in my possession; ’ and in the inventory, which is a separate document, the bond and disposition in security in question is set forth as being article 10 thereof. But it is also a fact in the case that the bond was not delivered to Mr M'William, but remained in Mr Carson's possession until his death; that it has never been in the possession of Mr M'William; and that it is now in the possession of the trustee. Besides all this, it cannot be said that the insertion of a writ in an inventory, which is a separate document from the disposition and assignation, is equivalent to a specification and assignation of the debt and grounds of debt, either according to the old established form of conveyancing, or the short form introduced and sanctioned by the recent statutes. It appears to me, therefore, that the original defect in the dispositive clause of the deed is not remedied by the clause assigning the writs.

But it is further maintained by Mr M'William that esto there has been a failure here to comply with the rules of conveyancing, and that he was not in a position, without farther procedure, to make up a valid feudal title in his own person to the debt and security; still, as the security only vests in the trustee in the sequestration tantum et tale, as it stood in the person of the bankrupt, and as the bankrupt was bound to give a good title to M'William, therefore the trustee can take the subject only under the like obligation. I am of opinion that this contention of the claimant cannot be sustained. It is true that in some cases where the bankrupt's right to an heritable subject, or an interest in heritable property, was at the date of the sequestration a mere personal right, a security granted prior to the sequestration over that right, in the belief that the bankrupt's feudal title was complete, will not necessarily be defeated merely because the granter's own right is afterwards found to have been a personal right. The security will be sustained provided actual or constructive intimation of the assignation has been made; and in such cases registration of the deed or of sasine thereon in the Register of Sasines, though unavailing as the completion of a feudal title, has been held equivalent to intimation.— See the cases of Paul v. Turnbull, 13 Sh.; Edmond v. The Magistrates of Aberdeen, 18 D. But the present case is in no way analogous to either of those referred to, for here Carson, the cedent, was himself feudally infeft in the heritable security; the only proper and competent mode of divesting himself thereof was by a formal assignation in one or other of the well-known forms, and completed by infeftment; and if he failed so to transfer, the assignee, who is himself a law-agent, and who seems to have himself prepared the deed, must bear the consequences

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of taking a defective assignation. This is just the ordinary case of a security being blundered by careless conveyancing, and thereby losing in a sequestration the preference to which its priority in date might otherwise have entitled it. In short, the question simply is, was Brown's security, or was it not, a part of the estate of Carson at the date of the sequestration? In my opinion it remained so, because the disposition and assignation in favour of M'William was inhabile to denude Carson. This being the case, the trustee, who has expede a feudal title to the security by notarial instrument following on his act and warrant of confirmation, has now fully vested himself with the debt for behoof of the general creditors, and the claimant M'William cannot successfully compete with him for the amount.

2. If I am right in the view now indicated, it is unnecessary to dispose of the other question raised in the record, which is, whether, assuming the assignation of the security not to be inept from defect of form, the infeftment which Mr M'William expede is inept in consequence of being recorded in the Burgh Register of Sasines, instead of in the General County Register of Sasines, being the appropriate register for writs affecting subjects which, like those in question, are held in feu? If this objection be well founded, Mr M'William cannot now, by any new procedure, make his right preferable to the real right completed by the trustee. Prior to the passing of the Conveyancing Act of 1874 this objection would have been formidable. But I think it is obviated by the 25th section of that statute, which abolishes the distinction between the tenures of feu and burgage, and provides, inter alia, that the ‘proprietors of estates in land which were held burgage shall be entitled to grant feus of the same, in the same manner and to the like effect as if such estates in land had been held by feudal tenure; and the titles of all such feus granted before the commencement of this Act shall be unchallengeable, on the grounds that such feus were of land held by burgage tenure, or that such titles have been recorded in the Burgh Register of Sasines.’

The facts upon which the present question depends are as follows:—(1) The parties agreed in stating at the bar that the subjects, which are situated within the burgh of Wigtown, are part of the burghal territory granted to the burgh by the royal charter in their favour; (2) That these subjects, though properly burgage subjects, were granted in feu by the magistrates to. Brown or his predecessor, and that the infeftment in favour of Brown was recorded in the Particular Register of Sasines for the shire of Wigtown; (3) That the bond and disposition in security granted by Brown to Carson was recorded by Carson, both in the Burgh Register and the County Register of Sasines; and (4) That the claimant Mr M'William did not record his disposition and assignation in any Register of Sasines, but expede an instrument of sasine more burgi in the whole subjects conveyed to him by that deed, including the subjects in Brown's security, and recorded that instrument in the Burgh Register of Sasines. It appears to me that such a case is one of those provided for by the recent statute. The assignation is a title,—no doubt a security title, but still a title to a feu granted before 1st October 1874 of land which was originally held burgage, but which has been feued out. Such a title is by the Act declared to be unchallengeable, although recorded in the Burgh Register of Sasines.

As my opinion, however, is adverse to Mr M'William on the main branch of the case, it follows that his claim must be repelled, and the claim for Mr M'Cutcheon, the trustee in the sequestration, sustained, with expenses.”

M'William reclaimed.

Argued for him—The assignation, although not in the form prescribed by statute, was a valid conveyance of the debt and security. The statutory form may be dispensed with. The bond itself was assigned to M'William. There could be no doubt that in a question with Carson M'William would have succeeded, and the trustee is not in a better position than Carson, but has taken the estate tantum et tale as it stood in the person of the bankrupt.

Argued for M'Cutcheon—The assignation was invalid, neither the new nor the old form having been observed. The debt was not assigned. The jus crediti remaining in the person of Carson became vested in the trustee by the act of sequestration. The assignation of a security, which was all that was done in this case, can have no effect if the debt be not assigned along with it. What right would the assignee, under this deed, have had to discharge the debt? Carson might have been obliged to implement his imperfect assignation had this question arisen between him and M'William, but the doctrine of tantum et tale cannot be extended so far as to lay this obligation to implement upon the trustee.

At advising—