Scottish Court of Session Decisions

The Bankruptcy (Scotland) Act 1856, sec. 102, enacts—“The Act and warrant of confirmation in favour of the trustee shall, ipso jure, transfer to and vest in him or any succeeding trustee for behoof of the creditors, absolutely and irredeemably, as at the date of the sequestration, with all right, title, and interest, the whole property of the debtor, to the effect following:—1st, the moveable estate and effects of the bankrupt wherever situated, so far as attachable for debt, to the same effect as if actual delivery or possession had been obtained, or intimation made at that date, subject always to such preferable securities as existed at the date of the sequestration and are not null and reducible”

John Andrew Macpherson, 5 Eskgreen, Musselburgh, brought a petition in the Sheriff Court of the Lothians and Peebles at Edinburgh against William John Allan Drummond, C.A., 37 George Street, Edinburgh, trustee on the sequestrated estate of the petitioner. In this petition he designed himself as John Andrew Macpherson, dental surgeon, 5 Eskgreen, Musselburgh, and prayed the Court “to interdict the defender from selling, disposing of, removing, or in any manner of way interfering with the following articles, presently in house No. 5 Eskgreen, Musselburgh, viz.— A— In Surgery—(1) Dental operating chair; (2) Dental operating chair attachment; (3) Dental operating chair spittoon; (4) Set of forceps, two gags, one mouth opener, two elevators, catch forceps, tongue forceps, scissors, artery forceps, absolutely necessary for operating purposes, all lying in righthand drawer of bookcase; (5) Burring engine and burrs; (6) Gasometer with two gas bottles attached and face piece; (7) Set of scaling, excavating, and filling instruments; and B— In Glass House—(1) Lathe; (2) Work bench; and (3) Set of workroom tools, all of which articles are absolutely necessary and essential for the pursuer carrying on the business of dentist, and so earning his livelihood, and which articles are the pursuer's property; and to grant interim interdict; and to find the defender liable in expenses in the event of his appearing and opposing the prayer of the petition.”

The petitioner averred that his sole means of subsistence had always been and still was the practice or business of dentistry, and that he had no training for any other occupation or business, and that he had practised dentistry for over twenty years successfully and skilfully. He admitted, however, that he was not registered under the Dentists Act 1878.

He further averred—“(Cond. 2) The defender, as trustee foresaid, has intimated his intention of taking possession of the articles enumerated in the prayer hereof, for the purpose of realisation and sale. These articles are the necessary working tools of the pursuer, who could not follow his business, and so earn a livelihood without them. They are absolutely essential to his carrying on his business as a dental surgeon. They consequently do not fall under the sequestration, and they accordingly remain the property of the pursuer. (Cond 3) In consequence of the defender's intimation referred to in the preceding article, the present petition has been rendered necessary. In the urgent circumstances interim interdict is respectfully sought, as if the defender were to sell them the pursuer would be deprived of the working tools by which he is able to follow his vocation and earn his living.”

The defender did not admit that the instruments mentioned in the prayer of the petition were necessary to the pursuer's business, but averred that in any case they were moveables attachable for debt and had vested in him in virtue of his act and warrant. He pleaded, inter alia, that the action was irrelevant.

The Sheriff-Substitute ( Henderson) on 27 th March 1905 repelled this and certain other pleas and allowed the parties a proof of their respective averments.

Note.—“The pursuer here, who alleges that he is a dental surgeon in practice, has become bankrupt, and the trustee under his sequestration has claimed certain articles enumerated in the prayer of the petition with a view to realising them for the behoof of the pursuer's creditors.

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The pursuer avers that the articles which he has enumerated are necessary working tools and that he cannot follow his business and earn a livelihood without them. He therefore craves for interdict against the trustee taking possession of and selling the same.

The Vesting Clause of the Bankruptcy Act 1856 (sec. life) carries to the trustee the moveable estate and effects of the bankrupt ‘so far as attachable for debt.’ Anything, therefore, which could not be poinded or arrested for debt is not conveyed to the trustee, and what has been decided as regards poinding has therefore a direct bearing upon what the trustee may claim.

This question of what constitutes ‘working tools’ has not been, so far as I have been able to find out, the subject of judicial consideration in the Court of Session since 1814, although there has been at least one case in the Sheriff Court within recent times.

“The earliest case is that of Reid, v. Donaldson, July 11th 1778, M. 1392, where the opinion was expressed that a creditor under a cessio was not entitled to attach ‘the tools by which the suspender, as an artificer, gains his daily bread.’ It is not mentioned in the report of this case what sort of an artificer the suspender was or what kind or quantity of tools he possessed. The next case is that of Pringle v. Neilson, August 5, 1788, M. 1393. There again the Court in like manner suspended as regarded wearing apparel and ‘working tools.’ Here also there is no allusion to what the ‘working tools’ consisted of, and it is somewhat difficult to figure what they can have been, as the suspender is described as, after having obtained cessio bonorum, ‘a retail dealer in the town of Dalkeith,’ being employed as a merchant's clerk. From this case to that of Gassiot, Petitioner, November 12,1814, F.C., there is no reported case. In Gassiot's case a teacher of foreign languages was held not entitled to retain furniture which he had purchased after being liberated from prison in virtue of a decree of cessio bonorum, but the Lord Justice-Clerk expressed a clear opinion that books or desks would be considered implements of the profession of a teacher of languages. In this view Lord Robertson concurred, and Lord Meadowbank was inclined to find him entitled to furniture suitable to his station in life.

The law remained in the position defined by the decisions in these cases—at all events as regarded reported judgments—until 1890, when the late Sheriff Cowan decided the case of Macmillan v. Barrie and Dick, February 25, 1890, 6 S.L. Review 103. Proceeding on the authority of Pringle v. Neilson, supra cit., the Sheriff-Substitute held that a sewing-machine, the property of a dressmaker, was a tool or implement by which her livelihood was earned, and could not be poinded or sold for debt. In his judgment in that case Sheriff Cowan refers to a previous decision of his own (unreported) in which he made a similar finding as to a piano belonging to a teacher of music.

In this state of the decided cases it becomes a matter of great difficulty to define, with any approach to certainty, what do and what do not constitute ‘working tools’ or ‘implements for earning livelihood.’

From a perusal of the list of articles annexed to the petition it seems as if some of them, such as forceps, &c., are really such ‘working tools’ as would fall under one or other of the above decisions.

I confess I feel myself unable to distinguish among the enumerated articles as to which are ‘necessary’ to the bankrupt in order that he may earn his daily living and what are unnecessary for that purpose. As the parties are, moreover, also at issue as to the value of the articles claimed by the trustee—the petitioner's counsel assessing their value at about £20, and the counsel for the trustee stating that they are worth upwards of £100—I have considerable hesitation in handing the whole of these articles over to the bankrupt without knowing what their value is.

I have, therefore, come to the conclusion that it is essential, before an intelligent judgment can be given in this case, that evidence of an expert or experts be led as to the necessity to the bankrupt of retaining all or any of the articles, and also as to their value, as this latter point must necessarily enter into the decision of the case.

The trustee, by letter from his agent dated 22nd February 1905, indicates that he is prepared to leave the ‘forceps, instruments, and workroom tools’ in the possession of the bankrupt, but I do not think that such a concession is sufficient to settle the questions raised in this case.

Some light as to the kind of articles which have been left with bankrupts in such circumstances is to be gathered from what is stated in a recent judgment by Lord Pearson in the Outer House in the case of Thom v. Caledonian Railway Company, February 25, 1902, 9 S.L.T. 440. The Lord Ordinary there states that a confectioner was allowed to retain certain dies used in his trade of the value of £50.

Some doubts were thrown upon the petitioner's status as a dentist both on record and at the bar, and it might be as well that this point be cleared up also at the proof. Counsel for the trustee moved that caution should be found by the bankrupt before any steps be taken in process. I have repelled the plea on which that motion is based. It seems to me that a bankrupt is entitled to vindicate to himself property which he maintains is not carried by the vesting clause of the Bankruptcy Act to his trustee without finding caution. To hold otherwise would be to open a wide door to possible oppression and denial of justice. Thom's case, supra cit., illustrates this view.”

The defender appealed against this interlocutor to the Sheriff ( Maconochie), who sustained the appeal, recalled the interlocutor appealed against, and dismissed the petition as irrelevant.

Note.—“In this case the Sheriff-Substitute allowed parties a proof of their

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averments, but since he did so the defender has amended his record by stating that the pursuer is not only not a registered dentist, but that he is not ‘a legally qualified medical practitioner,’ and holds no special licence to practise dentistry from the General Medical Council. It is admitted that these averments are true, so that the pursuer admittedly cannot design himself ‘dental surgeon,’ or by any other words suggesting that he is qualified to practise dentistry in terms of the Dentists Act 1878. The statutory rule under the Bankruptcy Act is that the bankrupt must give up all his property, except wearing apparel, to his trustee, but the Court has to some extent relaxed that rule by allowing certain bankrupts to retain the tools which are necessary to enable them to carry on the trade by which they earn their livelihood. The question, then, is whether the pursuer is under that rule entitled to retain the articles mentioned in the prayer of the petition, the value of which, I am told, is over £50. The practice which has grown up is, as I have said, a relaxation of a statutory rule founded primarily on humanitarian grounds, and the first remark which I have to make is that the pursuer here is by no means in a position to have his request that the relaxation should be given effect to in his case favourably considered. In the first place he designs himself in the instance and in his condescendence as ‘dental surgeon,’ a designation which he has no legal right to assume, and the assumption of which lays him open to prosecution for penalties. I am by no means sure that I am entitled to consider at all a petition so brought, as to do so is to countenance an illegal act on the pursuer's part, but I do not wish to rest my judgment solely on that ground. It is, however, clear to my mind that the primary object of the Dentists Act was to protect the public from the tender mercies of quack dentists, whose opportunities of doing serious injury would otherwise be large, and what I am asked to do is on grounds of humanity to the pursuer to give him, contrary to the terms of the Bankruptcy Act, power to carry on his unauthorised trade. It is true that for an operator to pull out or stop teeth without being registered or being a qualified medical practitioner is not rendered illegal by the Dentists Act, but such a practice is not, in my opinion, to be fostered by the courts. The general question whether such a trade or profession as that of a dentist is one to which the relaxation of the statutory rule should apply is a difficult one, and I do not find anything to assist me in previous decisions. In various cases artisans and such persons as sempstresses have been allowed to keep the articles necessary for carrying on their trade—articles as a rule of no great money value—and the dicta in Gassiot's case, Fac. Coll., November 12, 1814, seem somewhat to extend the class which is to have the benefit of the relaxation, but until some definite rule is laid down by the Legislature or the Supreme Court, each trade or profession must be considered on its own merits. The line must be drawn somewhere, as it would, for instance, be absurd to say that a large manufacturer who carried on his business by means of very expensive machinery should be allowed to withhold it from his trustee, and in like manner I do not think that a minister would be allowed to retain his divinity library or a lawyer his law books, though such aids are highly necessary for the successful exercise of their respective professions. Here the value of the articles is very considerable; the trade of dentist is a highly skilled one, and is one which the Legislature has seen fit to fence about with strict regulations if it is to be exercised under the authority of the law. In such circumstances I do not see my way to extend the benefit of an equitable relaxation to an unauthorised practitioner of a profession to which it has never yet been extended, but I wish to reserve my opinion as to what should be done in the case of a duly licensed dentist.”

The pursuer appealed to the Second Division of the Court of Session, and argued—(1) The articles mentioned in the prayer of the petition were not attachable for debt. The vesting clause of the Bankruptcy Act 1856, section 102, only carried to the trustee the moveable estate and effects of the bankrupt, “so far as attachable for debt.” The Sheriff was inaccurate, for the rule that means of livelihood could not be attached for debt was not a relaxation of the Bankruptcy Act but a rule of common law. The exemption from diligence of working tools and implements of livelihood was not confined to tools of little value of ordinary labouring men.— Reid, v. Donaldson, July 11, 1778, M. 1392; Pringle v. Neilson, August 5, 1788, M. 1393; Gassiot, Petitioner, November 12, 1814, F.C. (Reference was also made to the following Sheriff Court case— Macmillan v. Barrie and Another, 1890, 6 S.L. Review 103). (2) The pursuer had never in his practice used the name of “dentist” or “dental surgeon,” or any description implying that he was registered under the Dentists Act. The designation “dental surgeon” was due to a mistake of his agent, who had taken the designation from the act and warrant in the sequestration proceedings. The practising of dentistry by an unregistered person was not illegal— Emslie v. Paterson, June 12, 1897, 24 R. (J.) 77, 34 S.L.R. 674.

The defender (respondent) argued—(1) The cases of Reid v. Donaldson and Pringle v. Neilson gave no help as to what were working tools. The decisions referred to by pursuer were under the old law of cessio, which was as much for the benefit of the creditor as the debtor, and consequently the interpretation of the rule of exemption of working tools should not at any rate be extended. The width of the terms of the oath to be taken by bankrupts in section 95 of the Bankruptcy (Scotland) Act 1850, seemed to point in the same direction. Again, the question of value was of much importance, and the line must be drawn somewhere. In this case some of the articles were of great value. That value was a very important element was indicated

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by the Wages Arrestment Limitation (Scotland) Act 1870 (33 and 34 Vict. cap. 03), which did not save from arrestment the surplus of wages above 20s. a-week. The pursuer could not recover in any court of law his earnings at dentistry, and therefore for him it was not properly a trade or livelihood at all. (2) What was a humanitarian rule should not be extended to the practice of dentistry by an unregistered practitioner, for though this was not illegal, it was not regarded with favour by the law.