Scottish Court of Session Decisions

Lord President—It is admitted that the Court have in a whole series of cases exercised the nobile officium to the effect of reviving a sequestration where a trustee was dead or had been discharged, by directing that a meeting of creditors should be called in order to elect a new trustee. These cases, however, have taken place where the petitioner has been a creditor, and the point of novelty in the present case appears to be that it is not a creditor but the bankrupt himself who comes forward and makes the application to the Court. But when we consider the situation of the bankrupt in relation to his creditors, and to his own prospects of a discharge, I cannot help thinking that the same considerations which induced the Court to exercise the nobile officium in the previous cases apply here. This gentleman comes forward to assert that since his sequestration he has succeeded in business, and is now in possession of funds sufficient to pay his whole creditors in full, and it is not disputed by the respondent that he is in business, and only faint doubts have been thrown on his pecuniary sufficiency. Now, under these circumstances, why should the sequestration not be revived and put into gear? The interest of the creditors is to obtain payment in full, and equal payment share and share alike; and the interest of the bankrupt is to obtain his discharge. Now, the objecting creditor here says—“If his object is to pay his creditors, let him do so.” The bankrupt replies with irresistible force—“I am still a sequestrated bankrupt. I am not to judge who are my true creditors. The proper authority to judge of that is the trustee in the sequestration, which is still existent, though a dormant one.” And he says further—“I am not to pay at my own hand. Let the creditors meet and appoint another trustee. My object is to rehabilitate myself and obtain my discharge, and I cannot do so except through a schedule or sequestration process.” Now, I confess that appears to me irresistible, and it appears to me that the same principle as has led the Court in previous cases to grant such applications at the instance of creditors should be applied to the case of a bankrupt, where he makes averments which ex facie are probable and are not seriously disputed, who comes forward and says he will put funds in the hands of his trustee, and that he will pay if he is discharged. I am bound to say, after hearing all that has been said in support of the answers, I am still puzzled to understand what is the objection to a process which would give effect to the rights of all parties, including the rights of creditors.

Lord Adam—This is a petition for the appointment of a new trustee in a sequestration. The ground of the application is, that the trustee who was appointed a good many years ago was discharged, and that accordingly the sequestration, which is still an existing sequestration, cannot now for want of a trustee be effectually used for the purpose for which it came into existence. Now, it is perfectly true that the application for the appointment of a new trustee is usually made by a creditor, for the reason that the statute provides no machinery whereby such an officer can be appointed, and therefore it becomes necessary to come to the Court for that purpose. But the usual case which happens is, that the creditors discover that there are funds to be distributed, and they come forward and say—“Here are funds we are entitled to have; there is no machinery to distribute them; we therefore ask the Court to give us assistance to set section 103 in operation.” The novelty in this case is, that instead of the creditors having to enforce all usual legal means, the debtor comes forward and says—“Having made money since my sequestration, I am ready to pay all my creditors in full.” Well, who is the proper party to whom that money should be paid but the trustee, if there is one? Well, as it happens that the trustee in this particular sequestration was discharged some years ago, it appears to me that the regular and natural course is that the Court should supply the defective machinery of that sequestration by appointing a new trustee, and that that having been done, and the sequestration put in active operation, the petitioner should pay over the funds for distribution to him. That is all that is proposed to be done, and I agree in thinking that that is entirely within the principles of what has been done in previous cases.

Lord M'Laren concurred.

Lord Kinnear—I am of the same opinion. The ground of judgment in the case of Thomson was that the Court thought that while the case of the resignation or death of the trustee had been expressly provided for by the Act, the case of his discharge before the business of the sequestration has been fully concluded had not been foreseen by the Legislature. It was therefore held that in the exercise of the nobile officium the Court has a discretion to supply the omission in this respect, and to revive the sequestration in the case of the trustee's discharge, just as in the case of his death or resignation. In short, the Court treated the matter as a casus improvisus.

That, then, being decided, it comes to be a mere question of discretion whether the Court is to exercise the nobile officium on the application of the creditors or of the bankrupt himself. I agree with your Lordships that there is no reason why it should not be exercised upon the application of the bankrupt, who has a perfectly good title and interest to set the machinery of the

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