Scottish Court of Session Decisions

Subject_1 BANKRUPT.
Subject_2 DIVISION I.

Reduction of Alienations made by Bankrupts where the Reducer has done no Diligence.
Subject_3 SECT. XV.

Of Alienations to singular Successors.

Spence
v.
Creditors of Dick*

Date: 2 December 1692
Case No. No 119.

Not only the immediate contriver of fraud against creditors, but singular successors, purchasing from conjunct and confident persons, are affected by the act 1621; only they must be so far participes fraudis, as, from the circumstances, not to be entitled to plead bona fides.

In this case, a singular successor, whose right flowed from a person, ex facie of the deed, conjunct, was not bound, after 40 years, to prove either the actual solvency of his author, or even that he was habit and repute solvent.

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The Lords advised the reduction on the act 1621, pursued by Elizabeth Spence and Andrew Martin, writer to the signet, her husband, against Skirling, Mr James Nasmith, and the other contract-creditors of Sir William and Sir Alexander Dicks, of their right to the lands of Craighouse.—The Lords found a disposition of these lands by James Nasmith to James Rutherford, his son in-law, fell under the precise terms of the said act of Parliament; and though it bore to be for his tocher, and relief of cautionry wherein he stood engaged, yet that the said narrative did not prove the onerous cause of the disposition, unless it were aliunde instructed: But withall found, a father-in-law not being bankrupt, nor under diligence at his creditors instance, might dispone lands to his goodson as well as to any other person; but in that case, that the receiver behoved to prove the disponer had another visible estate; for though in law every man is presumed solvent, and not bankrupt, yet when a man dispones his lands to a near relation, it is presumed that it is omnium bonorum, unless it be instructed, that he had a farther estate beyond that which is disponed; and that the granter's assertion, in the writs, is not sufficient to verify that. But if it be in a writ produced and used by the pursuer, he cannot object; nam qui approbat reprobare nequit. But the difficulty occurring here was, that the right was now out of the person of the conjunct, and come in the hands of singular successors and strangers, who could not instruct, after so long an interval as forty years, what was the onerous cause of their author's right; and yet if they be participes fraudis it is redeemable as well against them as their author. And here it was alleged sufficient to put them in mala fide, that Nasmith's right to Rutherford, and his to Mr Alexander Dick, expressly bore his interest and relation as son-in-law, and so the subsequent acquirers

* In this case, the degrees of participation in the fraud of conjunct and confident persons, which ought to affect singular successors; the consequences of their knowledge that the party who conveyed to the interposed person, with whom they transact, was bankrupt or insolvent at the time; and the evidence requisite of such knowledge, are minutely treated of; also the distinction between conjunct and confident persons.

should have seen the onerous cause instructed; but they contended, they needed not look further back than Sir Alexander Dick's right, which bore as heritable proprietor, and related neither to Nasmith's nor to Rutherford's right, to put them in mala fide:—This point the Lords thought deserved farther consideration; but, in the general, fraud is only personal, and not vitium reale affecting singular successors, as appears by Stair, 9th February 1670, Scot against Chiefly and Thomson, Stair v. 1. p. 669. voce Fraud; but there seems to be as great reason that fraud should vitiate the act, as well as vis et metus. Only there is more of consent in the first than the last; but a forced will is a will still.

December 23. The Lords advised the cause pursued by Elizabeth Spence, and Andrew Martin, her husband, against the contract creditors of Sir William, and Sir Andrew Dicks, mentioned 2d curt.——The Lords abstracted from the point of prescription, though the interruption seemed very slender and defective, the summons produced either wanting executions, or not being reductions of this right of Craighouse, or raised only against parties after they were denuded, and others publicly infeft; and considered only that point, if singular successors after so long a time were bound to instruct that he was solvent, when he made the disposition to Rutherford his son-in-law, and had another separate estate besides Craighouse: And found they were not now obliged to instruct his solvency at that time, nor even so much as that he was then holden and repute solvent. Then the pursuers offered to prove, that Nasmith's disposition to Rutherford, his son-in-law, of the lands of Craighouse was a mere donation, without any onerous cause at all, merely to prefer his goodson to his creditors:—The Lords repelled this; because law presumed it gratuitous inter conjunctas personas, and so it needed no probation; though some of the Lords would have gone upon that ground that, post tanti temporis intervallum, they were not bound to instruct it had an onerous cause. But this was thought unnecessary here.

November 28. 1693.—The Lords advised the reduction on the act of Parliament 1621, pursued by Elizabeth Spence and Andrew Martin, her husband, against the contract-creditors of Sir William and Sir Andrew Dicks. The Lords were clear that the two dispositions granted by James Nasmith, in 1641, to Rutherford, his son-in-law, under that designation of Craighouse, though bearing onerous causes, did not instruct nor prove their own narrative, if it had been de recenti quarrelled: But it stuck with some of the Lords, that it was hard for singular successors post tanti temporis intervallum, to be put to prove the onerosity of their author's right, as they had found supra 23d December 1692. But they determined this day, that it was not relevant to reduce a singular successor's right, that he saw by the tenor and progress of the writs, that his author was a conjunct person to the first disponer, unless he also knew or might have known, that the first disponer was at the time a bankrupt; and though he acquires for onerous causes, yet he is particeps fraudis, if he knew the disponer without an onerous cause, was bankrupt at the time he made the said disposition; and that participation of fraud in singular acquirers, was not so strictly to be understood, as to be restricted only to him who was upon the contrivance and design of defrauding the creditors, but also ought to be extended to any who knew him then to be bankrupt; seeing that knowledge was sufficient to put him in mala fide: For the Lords thought it not enough that the right was granted to a son, or other conjunct person; and though it bore to be for onerous causes, yet law justly presumed it to be gratuitous, unless the conjunct person, the receiver of it, instructed its cause aliunde than by its own narrative: But further required a second qualification, against the singular successor acquiring from that conjunct person, that he knew him to be then broke. And because private knowledge cannot be well proved, especially where the parties are dead, it must be elicit from circumstances, or witnesses deponing that he was then generally holden and reputed a notour bankrupt by all; for it is not yet clearly decided, what makes one a bankrupt; whether diligences against him, or that he is obæratus above his estate, or that cessit foro, and has fled; for the Lords did not incline to reduce all gratuitous dispositions by fathers to their children, unless it was instructed that the father was before, or by the making thereof, rendered bankrupt; for many estates were bruiked by extraneous persons who bought from sons having right by such dispositions; and donations are not quarrellable, unless the donor was thereby rendered insolvent: So that if a conjunct person be denuded, and receive a price, the buyer from him is secure, unless they prove the conjunct person's author was then bankrupt, when he disponed to his relation, as well as that it was gratuitous, and without any onerous adequate cause. The pursuers of the reduction cited several decisions in their favours, viz. Stair, 6th February 1672, Dr Hay against Jamieson, No 114. p. 1009.; 23d Dec. 1679, Gordon against Ferguson, No 117. p. 1012.; and 24th January 1680, Crawford against Ker, No 118. p. 1012.; where the Lords found, that the clause of the act of Parliament 1621, in favours of singular successors, did not extend to such as knew their authors were conjunct persons to the first disponer, or where his right bore to be for love and favour only: But the Lords did not take any notice of the distinction which was urged betwixt a conjunct and a confident person; as if when it was to a conjunct, that it made a vitium reale against the singular successors, though transmitted through never so many hands; but that there was no such real vice, when it was not to a blood-relation, but only a confident interposed person. For the Lords did not incline to sustain a vitium reale in either case; though the conjunction may be sooner discovered than the confidence.

The next point decided was, though the act of Parliament has a clause in favours of singular successors acquiring bona fide, yet it has also an exception subjoined, unless there was diligence done against them by horning, inhibition, comprising, or otherwise; and that here, before Rutherford disponed to Mr Alexander Dick in 1645, (from whom the contract-creditors derive right,) Spence, now pursuer, had done diligence against Nasmith, the bankrupt, her debtor; after which Rutherford, the bankrupt's trustee, could make no voluntary right to Dick in prejudice of her debt.—The defenders alleged, the diligence behoved to be against the interposed person, else he could not be put in mala fide, by it: And it being urged, that there was no obligation, on which a diligence could be founded; and it being answered, that on a depending declarator, or reduction against him, an inhibition might be served; some contended, that the ground of an inhibition behoved to be some prestation, or deed to be performed, which was not in this case; the Lords inclined to think that the diligence meant in the act of Parliament, was what was done against the bankrupt, and not that which was against the interposed person: And then, by a vote, found the diligence done against Nasmith, the bankrupt, by Spence, though it was after Nasmith had disponed to Rutherford, his son-in-law; yet it incapacitated Rutherford from transmitting it to Mr Alexander Dick, seeing it was before his disposition to him. Five of the Lords were of opinion, that this diligence did not prejudge the singular successor's right, whatever it might operate against Rutherford the trustee.

January 10. 1694.—The Lords advised some other points of the debate, mentioned 28th November 1693, betwixt Elizabeth Spence and the contract-creditors of Sir William and Sir Alexander Dicks, and found, unless it were instructed that Rutherford was Nasmith's Trustee, it would not be sufficient to prove that Nasmith was bankrupt at the time when Rutherford disponed to Mr Alexander Dick, but they behoved also to prove that Nasmith was holden and repute bankrupt in 1641, when he made the first disposition to Rutherford, at least, that by that disposition he rendered himself and became bankrupt: And as to the interruption of the forty years prescription by Elizabeth Spence's minority, the Lords found the minority stopt the prescription, though it was not of the author's minority, but of a concreditor, or one having a collateral interest; and that in so far as extended to preserve their right from prescription, and no further. See Prescription.

November 9. 1694.—The Lords having found, that the creditors, who were sigular successors, were not obliged, post tanti temporis intervallum, of forty years and more, to prove the onerous causes of their rights, or to instruct that their debtor had a separate estate beside that disponed, especially seeing they had not proven him bankrupt at that time; for if they had been quarrelled upon the act 1621, they would have instructed both the onerous cause, and an estate aliunde; Andrew Martin gave in a bill reclaiming against this interlocutor, that the taciturnity was sufficiently taken off by a summons raised in 1642 on the said act 1621, both against Nasmith the bankrupt, Rutherford the son-in-law, and Mr Andrew Dick.—Answered, This was but a declarator for affecting sums, and making them furthcoming, and so was no reduction, nor had a special relation to the lands of Craighouse. 2do, There was no execution for the first diet, but only upon the act and letters.——The Lords found this was no nullity, seeing any execution was good for an interruption, talis qualis insinuatio sufficit: But the Lords found it did not take off the taciturnity, seeing it was not a real action against the creditors, whereby they could be obliged to instruct either his solvency, or the onerosity of their several rights; and therefore adhered to their former interlocutor. See Prescription.

November 28. 1694—In the cause mentioned 9th current, between Elizabeth Spence and Andrew Martin her husband, contra the Heirs of Sir Andrew Dick of Craighouse, and his Creditors; it was now alleged that Martin had a decreet of certification against severals of the writs now founded on, and so they could not be made use of.—Answered, The creditors stood publicly infeft under the Great Seal before the raising of the improbation; and yet they are not called, and so it is null quoad them.—Replied, These creditors are new dead, and their successors are not infeft, and so cannot propone this.——The Lords found apparent heirs could defend themselves on their author's infeftment; and that standing, then the certification could not meet them, because neither their predecessor last infeft, nor they, are called thereto. See Heir Apparent.

Fol. Dic. v. 1. p. 75. 76. Fountainhall, v. 1. p. 526. 537. 572. 590. 641. 645.