Scottish Court of Session Decisions

Subject_1 ADJUDICATION and APPRISING.
Subject_2 RANKING of ADJUDGERS and APPRISERS.

Sinclair and Doull,
v.
the Earl of Caithness and Innes

Date: 8 December 1781
Case No. No 41.

How an adjudication becomes effectual, in terms of the act 1661, when led upon the personal obligation in an heritable bond. When restricted to a security. When, being led against the ancestor, it stands in opposition to others led against the heir for the ancestor's debt.

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

Sinclair of Assery, in the year 1761, granted an heritable bond and infeftment over his estate to Innes of Sandside; who, in the year 1770, led an adjudication, which was afterwards made effectual by a charge against the superior, for the principal sum, and for the annualrents and penalties incurred since the constitution of his security.

Assery died in the year 1771, and his son made up titles to the estate, by precept of clare, and infeftment. In 1774, Sinclair of Stempster and Patrick Doull, creditors of old Assery, led adjudications; and, within a year after them, the Earl of Caithness, and Innes of Scotscalder, likewise adjudged for debts due by old Assery.

A ranking of the creditors, and sale of the estate of Assery, having been commenced, Mr Innes of Sandside's adjudication, on account of a trifling pluris petitio, was restricted to a security for the principal sums, annualrents, and necessary expences, accumulate at the date of the adjudication.

A state of the interests produced in the ranking was then made up; in which Sandside being the first effctual adjudger, was ranked in the first place: And as none of the subsequent adjudgers were within a year of him, they were ranked, one after another, according to the dates of their adjudications. By this mode of ranking, the Earl of caithness, and Innes of Scotscalder, could draw nothing till Stempster and Doull were paid; whereas, if they could in any manner remove Sandside's adjudication from being the first effectual one, those of Stempster and Doull would occupy that place, and theirs being within a year after, would be entitled to a pari passu preference. For this purpose, several objections were stated to Sandside's adjudication. It was 1mo, urged, That being deduced on an heritable debt, it was exempted from the operation of the statute 1661; and it was

Pleaded: The enactment 1661, c. 62, introducing a parity of preference in adjudications led before or within a year of the first effectual one, has excepted “ground-annuals, annualrents due upon an infeftment, and other real debts, and debita fundi, and comprisings following thereon.” Adjudications for debts of this nature are in every respect situated as they were before this act: They can neither be ranked pari passu with other adjudications, nor have any effect in regulating their preferences.

Answered: The exception occurring m the statute with regard to apprisings for real debts, was solely intended to preserve the preference due to such by virtue of their infeftments, and does not in any other way impinge on its effects. Nor could this exception, though of the extent pleaded for by the objectors, create any alteration in this ranking. Here the adjudication is led upon the personal obligement preceding the infeftment in security. No conclusion is drawn, or effect given to it, on account of the collateral real right. The creditor will indeed obtain a preference for a part of his claim in consequence of his infeftment; and as he cannot draw his payment twice, his adjudication will operate only to secure the residue; but to this extent his adjudication is strictly personal, and endued with all the qualities peculiar to such a right.

It was, 2do, objected to Sandside's adjudication, That being restricted to a security; it could not be the first effectual adjudication; and it was

Pleaded: An adjudication, deduced for more than was due, or defective in any other essential respect, is funditus void and null: And although this Court has been in use to sustain such a security, where the defect is only in the form of the diligences, or has arisen from a trifling error as to the amount of the debt; yet in this its transformed state, it must he destitute of the nature, and lose all the effects of an adjudication. It is accordingly held, that an adjudication, thus restricted, can, by no lapse of time, be converted into an absolute right of property; nor can the creditor in it obtain a declarator of expired legal. It is merely equivalent to a bond of corroboration secured on land, and ought to be attended with no other effect in the present case.

Answered: The expression used to specify the effects of an adjudication, restricted to a lesser sum than the decreet of adjudication authorised the creditor to draw, does not alter its nature, nor convert it into a different species of security. It is still an adjudication; and the creditor will draw the restricted sums; and his diligence, in every other respect, will be equally complete, as if it had been originally led for those sums; with this only exception, that the debtor is relieved from the penal consequences of an expired legal.

It was, 3tio, objected, That Sandside's adjudication having been led against the ancestor, could not regulate the preference of those led against the heir; and it was

Pleaded: The statute 1661 not only supposes an estate which is attached by various creditors, but also a common debtor, against whom all the adjudications entitled to an equal preference by this act, are led. The effect of the statute is described to be the same “as if one adjudication had been led for the whole of the respective sums contained in the adjudications, equally preferable by virtue of this act.” Here the party against whom Sandside's adjudication was led, and he against whom Stempster and Doull's adjudications were deduced, are totally distinct; and it is impossible to suppose that the different adjudications could be contained in one. Indeed, were the estate alone considered in a ranking, as prescribed by this act, very singular consequences must ensue. Where a proprietor, whose lands had been adjudged, sold his estate to another, the purchaser's creditors adjudging the estate within a year after the creditors of the seller, would be entitled to a pari passu preference. Or, if we suppose an ineffectual adjudication to have been led against an ancestor, and afterwards another against the heir, for his proper debts, the last would in like manner enjoy the benefit of this act. Nor can the supposed identity between the ancestor and the heir make any distinction in this case. An heir, by the law of Scotland, may, by his deeds, incur a passive representation; and, to the effect of being liable to the ancestor's creditors, become eadem persona cum defuncto: But such deeds can create no connection between him and his predecessor's estate, which must be transmitted, according to feudal rules, with the concurrence of the superior; and although, by particular enactments, certain forms of law have been, for the benefit of creditors, made equivalent to a service, yet no active right is thereby conveyed to the heir in the property of the estate.

Neither is it new, that there should, in this manner, be two classes of equally preferable adjudications affecting the same estate. In the cases already put, the adjudications against the author, or ancestor, cannot regulate the ranking of the creditors of the singular successor or heir. The last could only attach the estate as it stood in their debtor, incumbered with one or more adjudications against the author or ancestor, which will be considered in the ranking as so many heritable securities affecting the subject of the competition. In the same manner, the subject of the present ranking must be viewed as an estate vested in the heir, incumbered with the adjudications against the predecessor; and the estate so incumbered, must be divided among the competitors according to the ordinary rules of preference.

Without this interpretation, the present statute must be exceedingly defective. No provision is made for a case, which might frequently occur, of a debtor dying within the year, or perhaps a day, after adjudications have been made effectual against his estate. By this event, on account of the annus deliberandi, his other creditors must, without any fault on their part, and from their considence in the efficacy of the present statute, be precluded from every benefit arising from thence. This certainly would have been guarded against, if the legislature had intended, that the first effectual adjudication against the ancestor should be the leading diligence in the ranking of those led against the heir.

Answered: The statute 1661 has introduced no new rule of preference, nor altered in any manner those which were formerly established. At that period, it was in the power of a creditor, more rigorous, or better acquainted with the debtor's situation, by precipitant measures, to get the start of his competitors; a circumstance which, while it rendered the security of creditors exceedingly precarious, had a corresponding effect on the situation of the debtor. To remove this was the object of the present enactment, by creating a parity of preference, under certain restrictions, among adjudications which differed in nothing but in date, and where nothing hindered their being included in the same decreet, but that the creditors in some had been more industrious than others in bringing forward their diligence. Hence those adjudications, which, prior to this period, could never be led at the same time, nor be included in one decreet, are not in the least degree affected by it. Of this nature, are the examples adduced on the other side, where adjudications have been led against an author, and thereafter others against the singular successor; or where, after adjudications led against the predecessor, others have been led against the heir for his proper debt. There the singular successor, or heir, could carry nothing by their purchase or service, but the right of reversion competent to their respective authors; and their creditors, who by diligence substitute themselves in their place, must be in the same situation.

Such instances, however, are to be carefully distinguished from the present, where one adjudication is deduced against the ancestor, and another against the heir for the ancestor's debts. Here not only the subject of the ranking, but also the debtor, is the same, since the heir, whether having made up titles in the direct way by service, or by fiction of law, through the media introduced by the statutes 1540 and 1621, is, as to the creditors of the ancestor, the same person with the ancestor. Hence it does not admit of a doubt, that an adjudger against the ancestor, whole diligence has not been made effectual, in terms of this statute, during the ancestor's life, would come in pari passu with the first effectual adjudger against the heir for the ancestor's debt. And, upon the same principle, where an effectual adjudication has been led against the ancestor, that must be the leading diligence in the ranking of his creditors, and upon his estate. The inconveniency which might arise, in the particular case of a debtor dying immediately after his estate is carried off by an effectual adjudication, can rarely happen, and seems to have been overlooked by the statute. If it occurred, it might be rectified, by allowing the diligence of the other creditors to proceed within the year, in the same manner as where the heir, in favour of particular creditors, has renounced the benefit of the annus deliberandi; Erskine, b. 3. tit 8. § 55. At all events, this defect, supposing it incorrigible, cannot prevent the effects of the statute in cases equally within its letter and spirit.

The first two objections were unanimously repelled by the Court; who, though some of the Judges expressed doubts as to the efficacy of the last, adhered to the Dord Ordinary's interlocutor, finding, “ That Sandside's adjudication was to be considered as the first effectual.

Lord Ordinary, Monboddo. For the Objectors, Ilay Campbell & Crosbie. For Stempster and Doull, Rac & Maclaurin, Clerk, Menzies,

N. B. All the Judges who spoke, declared their opinion, That a creditor, in danger of losing his preference, by the death of his debtor, after an effectual adjudication had been led by another creditor, would obtain relief in the way suggested by the respondents.

Fol. Dic. v. 3. p. 13. Fac. Col. No 11. p. 20.