Scottish Court of Session Decisions

Subject_1 RIGHT in SECURITY.
Subject_2 SECT. V.

Right in security is, in general, not broader than the real debt at the time of granting the security.

Competition Creditors of Langtown

Date: 26 February 1762
Case No. No 27.

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In October 1688, Sir Archibald Cockburn of Langtown granted to his son Sir Archibald, junior, a disposition of certain lands, for security of all debts for which he and his son were mutually bound. The estate did not come to a sale till 1757, when a competition arose between those who were singly creditors of the father, and the creditors to whom the father and son were jointly bound. The proper creditors of the father brought a reduction of the disposition 1688, in which the first question was, Whether the disposition from the father to the son, which was only for relief of debts contracted, without mentioning any particular debt, with the charter and sasine following thereon, was effectual to vest any real right in the son? On which it was contended, That if a deed granted in security of sums jointly contracted to a number of creditors, whose names do not appear on any record, can be made real by infeftment, no discharge or renunciation whatever can afford sufficient security against a number of claims, all of which are concealed, and most of which there is no possible way to discover. The second question was, Whether, supposing the father to have been insolvent at the date of the disposition, that deed, not being a disposition omnium bonorum, was reducible as in fraudem creditorum? Thirdly, Whether, post tantum temporis, it was competent for the pursuers to insist on this ground of reduction, as there had been a process of ranking in dependence fifty years before, in which all the decrees of preference had been pronounced on the ground of the disposition 1688 being a valid deed? The Lords found, That the disposition granted by Sir Archibald Cockburn to his son, for security and relief of all engagements the son had come under for the father, and which especially declared, That all bonds wherein they stood jointly bound were proper debts of the father, which disposition was followed by infeftment, was a valid and legal security to the son on the estate disponed for his relief of all debts wherein he stood bound with his father preceding the date of the disposition, notwithstanding the particular debts were not specified; and that the son was thereupon preferable to all the creditors of the father, whose rights were not made real by infeftment before the date of the son's infeftment, and that to the extent of the said debts for which the infeftment for security and relief was granted; and in respect that the proper creditors of the father did not allege that the estate conveyed by the father to the son exceeded in value the debts for relief of which the son was infeft, found, That they could not draw any part of the price of that estate; and, lastly, found, That an inquiry into the situation of the circumstances of the father, at the date of the disposition made by him to his son in 1688, was not competent post tantum temporis.

Fol. Dic. v. 4. p. 241.

*** This case is No 49. p. 10220. voce Personal and Real.