Scottish Court of Session Decisions

Subject_1 PROOF.
Subject_2 DIVISION V.

Proved, or not proved.
Subject_3 SECT. XIII.

Trust posterior to the Act 1696.

Elizabeth Gilmour, Relict of the deceased Mr James Justice of Justice-hall,
v.
The Honourable John Arbuthnot

Date: 11 December 1765
Case No. No 659.

Parole evidence competent to prove that a conveyance of a real right was in trust.

Click here to view a pdf copy of this documet : PDF Copy

Mr James Justice, in 1747, granted a bond to Mr James Arbuthnot, merchant in Edinburgh, for L. 100 Sterling; and, as a farther or collateral security, for the sum in the bond, Mr Justice conveyed to Mr Arbuthnot an adjudication against the estate of Stanhope for L. 1000 Scots principal, and considerable bygone annualrents.

Some time after this transaction, Mr Justice's affairs being in disorder, he named certain trustees, who took the management of his subjects; and, from these trustees, Mr Arbuthnot received payment of his debt of L. 100, contained in Mr Justice's bond.

Mr James Arbuthnot having died without reconveying the adjudication, on the estate of Stanhope, to Mr Justice, an action was raised by Mr Justice against Robert Arbuthnot, the heir of James, concluding that the right which stood in Mr Arbuthnot's person to that debt, should be reduced; and that Robert, as heir to James, should be obliged to denude thereof in favours of Mr Justice, the debt, for security of which it was conveyed, being aliunde satisfied and paid.

Before any judgment was given in this action, both Mr Justice and Mr Robert Arbuthnot died. But Elizabeth Gilmour, the widow and executrix of Mr Justice, having wakened the process, and transferred the same against the Honourable John Arbuthnot, the heir of Robert and James Arbuthnots, the Lord Ordinary, before whom the action came, allowed a proof, before answer, of all facts and circumstances for supporting the libel, and afterwards pronounced this interlocutor: “The Lord Ordinary having advised this process, proof adduced by the pursuer, and writs produced, finds it proved, that the conveyance of the debt in question, and diligence thereon, against the estate of Stanhope, was only granted as an additional or collateral security, for payment of the sum of L. 100 Sterling, and annualrents thereof, due by the bond libelled on, granted by the deceased Mr James Justice; finds it likewise proved, that the said James Arbuthnot was thereafter assumed into the benefit of the trust-right, executed by the said Mr James Justice, for behoof of his creditors, in consequence of which, he and his representatives received payment of the debt contained in the said bond; and, therefore, finds the Representatives of the said Mr James Justice have the only good and undoubted right to the decreet of adjudication, deduced for the foresaid debt upon the estate of Stanhope, and lands, and sums of money therein contained; ordains the defender, Mr John Arbuthnot, and his father for his interest, to make up and establish a proper right thereto, in his person, as representing the deceased Robert and James Arbuthnots, and habily to convey and make over the same to the said Mr James Justice's Representatives, they always completing their titles to the said debt and diligence, before extracting; and reduces, decerns, and declares accordingly.” And to this interlocutor the Lord Ordinary adhered, with the variation of finding, that the pursuer must be at the expence of making up titles, in the defender's person, to the debt in question.

Mr Arbuthnot reclaimed to the Court, and contended, That, as the proof was allowed by the Lord Ordinary before answer, all objections to the competency of a proof by witnesses, in this case, were entire. It was acknowledged that the pursuer had brought pretty satisfactory proof that this was a trust; but it was pleaded, That, in point of law, a trust could not be proved by parole evidence, the act of Parliament 1696, cap. 25. having altered our former practice, as to trusts, as, by that act, it is statuted and ordained, “That no action of declarator of trust shall be sustained, as to any deed of trust made for hereafter, except upon a declaration or back-bond of trust, lawfully subscribed by the person alleged to be the trustee, and against whom, or his heirs, or assignees, the declarator shall be intented, or unless the same be referred to the oath of party simpliciter.” And, as there was here no back-bond, or declaration of trust subscribed by James Arbuthnot, and as Mr Arbuthnot was now dead, so that a proof, by his oath, could not be had, therefore the action must fall; and, in support of this plea, the pursuer referred to the decision in the case of Watson contra Forrester, 9th December 1708, No 658. p. 12755.

Answered for Mr Justice, There is, in this case, sufficient evidence to show that the debt of L. 100, contracted by Mr Justice to James Arbuthnot, by his bond in 1747, was wholly paid up; and likewise, that the assignation to the debt, on the estate of Stanhope, in favour of James Arbuthnot, was granted only as a collateral security, for payment of said debt of L. 100, contained in Mr Justice's bond. And, as these facts are instructed, it would be contrary to material justice to deprive Mr Justice's Representatives of this debt, upon any nicety or peculiarity of the law. The act of parliament 1696 does not apply, as the present action ought not to be considered as a declarator of trust, but as a declarator of extintion of the debt due by Mr Justice, and a reduction of the conveyance to Mr Arbuthnot, on account that the purpose for which it was granted did not now exist.

“The Lords adhered.”

For Elizabeth Gilmour, Alexander Wight. For John Arbuthnot, Jo. Douglas. Fac. Col. No 25. p. 242.