Scottish Court of Session Decisions

Subject_1 BANKRUPT.
Subject_2 DIVISION III.

Decisions upon the act 5th Parliament 1696, declaring Notour Bankrupts.
Subject_3 SECT. VI.

Securities granted in consequence of Anterior Obligations.

The Trustee for the Creditors of John Brough,
v.
George Spankie and James Jollie

Date: 5 June 1793
Case No. No 222.

An heritable bond of relief, upon which an infeftment had not been taken till within sixty days of bankruptcy, found to fall under the statute 1696, altho' in implement of an obligation in writing, granted at the time the original debt was contracted.

In opposition to No 220. p. 1170.

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In this case, which has a strict connection with No 216. p. 1160. George Spankie and James Jollie, on the 6th October 1787, accepted a bill along with John Brough, for L. 500 Sterling.

Of the same date, Mr Brough granted a holograph missive, which, after narrating, that they were only cautioners for him in this bill, concluded thus:

“And seeing I agreed to give you an heritable security in relief of the said sum, previous to your consenting to join me in said bill, I oblige myself to do so accordingly, over my property in Register Street, and that as soon as the proper writings can be made out.”

In terms of this missive, Mr Brough, on the 7th December following, granted Messrs Spankie and Jollie an heritable bond of relief, on which infeftment followed the same day.

These gentlemen having agreed that Mr Brough should be held as bankrupt on the 17th January 1788, for the reasons mentioned in No 216. the trustee for his creditors objected to their security, as being obtained within 60 days of this period, and so falling under the act 1696.

The counsel on both sides referred to their papers in the case alluded to; and on the part of the defenders it was further urged, that the case, Houston and Company against Stewart, No 220. p. 1170. was precisely in point, it having been there found, that an heritable security, when granted in consequence of an obligation contemporary with the original debt, was to be held in law as granted of the same date with it.

On the other hand, the objectors founded on the following additional authorities; Bankton, b. 1. tit. 10. § 104.; Eccles against the Creditors of Mackerston, No 197. p. 1128.; and Beg against Peat, in 1769, Fac. Col. No. 95. p. 175. voce Ranking and Sale. They likewised contended, that a holograph writing cannot prove its date in a question with third parties, and that to pay any regard to it in the present case, would prove the source of endless fraud and collusion.

The Lord Ordinary at first repelled the objection, but afterwards took it to report, on informations.

Observed on the Bench: The judgment in the case of Houston and Company against Stewart is erroneous. Till the heritable bond was granted, Messrs Spankie and Jollie were mere personal creditors; and it is contrary to the principles of our law, as laid down both by Lord Bankton; and by M'Kenzie in his Commentary on the act 1621, that an obligation to grant an heritable security should entitle the bankrupt voluntarily to fulfil it, after he falls under the retrospect of the act 1696.

The Court unanimously sustained the objection.

Lord Ordinary, Dreghorn. Act. Solicitor General, Patison. Alt. Dean of Faculty, Gullen. Clerk, Mitchelson. Fol. Dic v. 3. p. 61. Fac. Col. No 57. p. 126.