Scottish Court of Session Decisions

On 27th May 1880 Duncan Robertson, tenant for fifteen years from Whitsunday 1873 of the farm and lands of Comar, Strathglass, situated in the counties of Inverness and Ross, entered into a minute of agreement with Major Walter Boyd, residing at Fasnakyle, Strathglass, whereby he agreed to sublet to him a portion of his grazing ground for sporting purposes for and during the remainder of his (Robertson's) lease, with entry at Whitsunday 1880. This agreement bore that “the yearly rent for the land hereby let shall be assessed or valued by two valuators, one for each of the above-named parties, with an oversman if required, and the two contracting parties hereby agree, one to accept, and the other to pay over his yearly rent thus assessed as rent for said lands.” It was further provided that Major Boyd should be at liberty to sublet or assign the sublease. The rent of each year was to be payable in one sum at Martinmas in order to correspond with the way in which Robertson had to pay his rent under the principal lease, and the first payment was to be at Martinmas 1880. Major Boyd thereupon entered on possession under this sublease.

On 1st September 1880 Major Boyd offered to assign his sublease to a Mr Winans, the offer to be open to the end of 1880. It was not accepted till the 13th December 1880, as after stated.

On the 9th and 10th November 1880, on the narrative of the previous agreement, Mr Robertson and Major Boyd entered into a minute of agreement and reference providing that, “Whereas the subrent payable by the said Major Walter Boyd to the said Duncan Robertson for the said portion of land has, by the arrangement of parties, to be ascertained and fixed by persons of skill to be mutually chosen, or an oversman, Therefore the parties hereto have agreed, and do hereby agree, as follows, viz., that Duncan Macmillan, farmer, Drumclune, Drumnadrochit, and Alexander Maclennan, grazier, Leanassie, Kintail, shall be, and they are hereby, mutually chosen and nominated and appointed as valuators in the premises, and in the event of their differing in opinion, John Mundell, tacksman of Gorthlick, shall be oversman, with full power to them respectively to inquire into, ascertain, and fix the yearly subrent payable by the said Major Walter Boyd to the said Duncan Robertson for the said portion of land; and whatever the said valuators, or in the event of their differing in opinion, the said oversman, shall fix and award in the premises, the parties hereto bind and oblige themselves, and their respective heirs, executors, and successors whomsoever, to implement and fulfil to each other.” This document was executed before witnesses, and contained a formal testing-clause.

The valuators and oversman accepted the reference in writing as follows:—“ Inverness, 10 th December 1880. —We accept of the foregoing reference.” Then followed the signatures of Macmillan, Maclennan, and Mundell. On the same date, 10th December, this minute, written by one of them, and signed by him and the others, was endorsed on the submission:—“ Inverness, 10 th December

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1880.—We, agreeably to the foregoing submission, hereby fix the yearly rent of the ground inspected by us in September last, as specified above, at Ninety-five pounds sterling (£95).— Duncan Macmillan. A. Maclennan. John Mundell.”

Winans on 13th December 1880 accepted the offer of the sublease made by Major Boyd, as already stated, and on the 26th and 27th December a formal transfer of the sublease was made to him by assignation. In the assignation, to which Robertson was not a party, there was this clause with regard to the rent under the sublease to Robertson—“It having been further agreed that the yearly rent for this land thereby let should be assessed or valued by two valuators, one for each of the said parties, Duncan Robertson and Major Walter Boyd, with an oversman if required, and the two said contracting parties having agreed, one to accept and the other to pay over his yearly rent thus assessed as the rent for said lands, but the agreement appointing the valuers not having been made, and the exact amount of said rent not having been agreed upon and fixed at the date of the proposal of Major Walter Boyd to transfer this sublease to said William Louis Winans, viz., 1st September 1880, it is left as an obligation to the said Duncan Robertson and said William Louis Winans to make an agreement appointing valuers, and to have the exact amount of this rent, so far as it becomes payable after the date of this transfer, agreed upon and fixed by measures to be taken by themselves hereafter, in accordance with said sublease.”

Winans by the assignation undertook liability for the whole rents to become due after the assignation, and to observe the whole conditions and obligations of the sub-lease to Boyd; Major Boyd, on the other hand, undertaking to relieve him of all claims for rent previous to the transfer.

Immediately after the date of the assignation, Winans entered on possession, and continued to possess at the date of this action. The assignation of the sub-lease was intimated to Robertson on 14th April 1881. The first rent under the sublease, viz., that for 1880, was due at Martinmas 1880, according to its terms, as above stated, and on 3d February 1881 Major Boyd paid Robertson £95 as the rent, that being the sum fixed by the submission. No further rents had since been paid either by Major Boyd or by Mr Winans as at the date of this action, the former contending that Winans had become the tenant and that he himself was no longer liable, the latter contending that he was not bound by the alleged reference or award, even if it were good, as he had been no party to it, and further that the reference was incompetent, and the award informal and invalid.

Robertson in February 1883 presented this petition in order to have Major Boyd and Winans ordained, conjunctly and severally, to pay him (first) the sum of £95 sterling, with interest thereon at the rate of 5 per cent. per annum from the term of Martinmas 1881 until paid; and (second), of the like sum of £95 sterling, with interest thereon at said rate from the term of Martinmas 1882 until paid.

The defender Boyd stated that though he considered the award as irregular and invalid, and the amount excessive, he had consented to pay the rent for 1880–81, as his interest in the sub lease nearly was terminated. The award was neither holograph nor tested. It professed to be a joint award of the arbiters and oversman, as if the reference were to three persons in place of two; there was nothing to show whether or not the arbiters differed or made any devolution. Neither the arbiters nor oversman heard parties, nor gave them an opportunity of being heard, nor did they make any inquiry for themselves after the reference was entered into. By the assignation of the sublease he had been divested, and he therefore refused to pay the rents due after its date. He also stated that the reason no reference was made in the assignation to the rent fixed under the reference was that both he and Winans considered it excessive, and Winans required, therefore, that no reference should be made to it, in the hope of making better terms with the pursuer afterwards.

The pursuer pleaded—“(1) The defender Major Walter Boyd having acted upon and so far implemented the said award, has homologated the same, and is now barred from raising technical objections as to its form. (3) The defender Major Walter Boyd having taken the pursuer's land, and agreed to pay such annual rent therefor as should be fixed by arbitration, is liable for the rents sued for. (4) The defender the said William Louis Winans, in respect of his use and possession of said land, is also liable to the pursuer for the rents thereof.”

Boyd pleaded—“(1) The defender Boyd having assigned the sublease in virtue of powers therein contained, and the sublessee having received possession and been accepted and recognised as assignee by the pursuer, the defender Boyd is liberated from liability for the rent sued for, and is entitled to absolvitor with expenses. (2) The pretended award being ex facie irregular and invalid, it cannot be made the foundation of an action.”

The defender Winans stated that the proceedings in the reference founded on by the pursuer took place without his knowledge, and after Major Boyd had on the 1st September made him the offer to assign the sublease which he ultimately accepted. He therefore declined to recognise the reference or award as in any way binding on him, even though they might be valid and effectual in themselves. Further, the award was ex facie informal and invalid, and the sum fixed was excessive. He was quite willing to pay a fair rent which might be fixed by an arrangement with the pursuer.

He pleaded—“(3) The defender having been no party to the reference founded on, though he was the party chiefly interested in the subject of the reference, cannot be bound by an award pronounced in said reference. (5) The defender having all along been willing to pay for the said grazings a fair and reasonable rent, this action is premature and unnecessary, and should be dismissed with expenses. (6) Separatim, The reference or alleged reference having been incompetent, and the award or pretended award being informal and invalid, these cannot be founded on in support of this action.”

The Sheriff-Substitute ( Blair) pronounced this interlocutor—“Finds (1st) That although the decree-arbitral which is written on the minute of agreement and reference between the pursuer Duncan Robertson and the defender Major Boyd

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is informal and not tested, it is subscribed by the arbiters and the oversman named in the said minute of reference, and contains all the essentials of an award by the said arbiters and oversman; (2d) That the defender Boyd on or before the 3d February 1881 accepted the terms of the award contained in the said decree-arbitral, and paid to the pursuer the sum of £95 as the rent of the subjects in question for the period from Whitsunday 1880 to Whitsunday 1881; (3d) That the defender Boyd by assignation dated 26th and 27th December 1880 assigned the lease of the said subjects to the defender Winans, and intimation thereof was made on 14th April 1881 by the said defender Winans to the pursuer, who acquiesced therein; (4th) That the defender Winans entered into possession of the said subjects on or about the 27th December 1880, and still continues in possession under the said assignation: Finds in law that the informal writing containing as it does all the essentials of an award, and followed by rei interventus showing that the decision of the arbiters and oversman had been accepted by the defender Boyd, is binding on the defender Boyd and on his assignee the defender Winans, and that under the said minute of reference, and the decision of the arbiters and oversman, the pursuer is entitled to decree against the defender Winans as concluded for: Finds further in law that after the assignation of the lease had been duly intimated to and acquiesced in by the pursuer and the defender Winans, the assignee admitted into possession, the obligation of the defender Boyd for rents was limited to those due prior to the possession of the said defender Winans, the assignee: Therefore sustains the defences for the defender Boyd, and assoilzies him from the conclusions of the action, and repels the defences for the defender Winans, and decerns against him in terms of the prayer of the petition: Finds the pursuer entitled to expenses against the defender Winans, and liable in expenses to the defender Boyd.

“ Note. —In making their award the arbiters and oversman have not observed the usual formalities, for although holograph of one of the arbiters, the award is neither tested nor executed in the form of a regular decree-arbitral. If this award has stood alone, I must have found that the pursuer had failed to instruct his claim. But as the award, informal and improbative as it is, has been adopted and homologated by the defender Boyd, I am of opinion that it mnst now be held to be valid and effectual, and that the pursuer is entitled to decree. Decree, however, has been given against the defender Winans only, because where the assignation of a lease is intimated to and acquiesced in by the lessor, and the assignee is admitted to possession, the liability of the original lessee ceases. ‘The very nature of the thing implies that the cedent must be free. Lease is a mutual contract, and if the lessor consents to a substitution, there is an assignation on the one hand and a delegation on the other’— Skene v. Greenhill, May 20, 1825, 4 S. 25.

Authorities cited by defender Boyd—Dickson, sec. 656; Bell on Arbitration, secs. 452 and 784; Hunter, vol. ii. p. 170.

Defender Winans—Bell's Com. i. p. 140; Hunter, ii. p. 170, i. p. 235.”

Winans appealed to the Sheriff ( Ivory), who recalled the interlocutor appealed against in so far as it found the pursuer liable in expenses to the defender Boyd; quoad ultra affirmed the interlocutor appealed against; and found the pursuer entitled to additional expenses against the defender Winans.

Winans appealed, and argued—He could not be found liable to pay any rent fixed under the reference founded on by the pursuer, which was nothing more than a private agreement between the latter and Major Boyd, and of which the appellant knew nothing. To make the reference binding on him he should have been made aware of it from the very first, and as soon as he accepted Boyd's offer to assign the lease he should have been sisted as a party to the reference. The pursuer's true remedy, then, lay against Major Boyd, with whom alone he had a contract under the reference. But whatever effect the reference might be said to have in a question between the pursuer and Boyd, the award of the arbiters appointed in the reference was improbative and invalid, and therefore of no binding force whatever.— Short, July 3, 1711, M. 16,867, in which it was held that a decree—arbital was not a probative writ in respect it lacked the writer's name and designation; Haliburton v. Haliburton, July 1708, M. 16, 970, in which a decreet-arbital was held not to be a privileged writ, and therefore to be null for want of witnesses; Percy, Nov. 25, 1807, F.C. 13. The award here, then, was mere waste-paper, and (3) no homologation or rei interventus could make it of legal effect. Even if it was capable of having been homologated by Major Boyd it could not be enforced against the appellant, who was no party to it. It was idle to argue that it had been homologated by Major Boyd's paying the rent on 3d February 1881, for by that time he had been divested of the lease, and this was within the pursuer's knowledge.

The pursuer replied—The reference was a good fulfilment of the obligation to have the rent fixed during the whole of Major Boyd's tenancy, which had been placed on both parties in the informal lease. The obligation was not such as would justify the expectation that it would be carried out in a deed which should be probative in form. But was it necessary that the award should be probative? There were many classes of decreets-arbitral which need not be probative— Lees v. Burroughes, 1810, 12 East. 1; Moncur v. Waddell, June 22, 1615, M. 644; Dykes v. Roy, Jan 13, 1869, 7 Macph. 357, vide Lord Cowan, p. 360; Fraser v. Lovat, Feb. 29, 1850, 7 Bell's App. 171; Campbell v. M'Holm, Dec. 11, 1873, 2 Macph. 271, (Lord Deas' opinion, 281). It was enough that it was valid under the new law as being signed before witnesses, and that it was admittedly a genuine document. (2) It was homologated by Boyd when he possessed under it and paid the rent to the pursuer on 3d February 1881. It then effectually bound Winans, who was Boyd's assignee in the lease. There was no averment on record in support of the argument that the pursuer knew that Boyd had divested himself in favour of Winans when he paid the rent on 3d February 1881.

The appellant's counsel craved leave at this stage to add to the record the following averment:—“Admitted that at the period here mentioned ( i.e., the end of 1880 or beginning of 1881) the appellant took possession of and used

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the subjects in question, and explained and averred that the pursuer knew of this at the time, or at least before 3d February 1881.”

The pursuer's counsel objected to the amendment being allowed, on the grounds—(1) That there was enough on record to decide whether the appellant was responsible for the rent; and (2) that the proposed averment was not specific enough to warrant alteration of the record, or to be remitted to probation.

Counsel for the defender Major Boyd appeared and stated, that as no decree had been pronounced against the defender he merely watched the cause in the latter's interest in case the pursuer should now move for decree against him.

At advising—