John Reid - Lord Advocate (Jeffrey). Dr. Lushington v. Peter Lyon - Knigh - Russell [1832] UKHL 6_WS_114

UKHL
John Reid - Lord Advocate (Jeffrey). Dr. Lushington v. Peter Lyon - Knigh - Russell
[1832] UKHL 6_WS_114 · 1832-07-16
Circumstances under which an assignation of a lease ex facie absolute was held (affirming the judgment of the Court of Session) to have been granted in security only, and to be redeemable by the heir of the assignor, on repaying to the assignee the advances made by him in relation to the lease.In April 1798 Peter Lyon, druggist in Edinburgh, entered into a contract of lease with Sir James Montgomery of Stanhope, whereby Sir James let to Lyon, his heirs, assignees, and sub-tenants, the lands of Comely Garden, lying near Edinburgh, for the space of 500 years from Martinmas 1797, at a rent of 46 l . 12 s . 4 d . per annum, but which, after the lapse of seven years, was to rise to 60 l ., with a power of granting sub-leases for the purpose of building. Lyon entered into possession; but having afterwards incurred an arrear of rent from Candlemas 1812 to Candlemas 1815, amounting, with interest and expences, to above 218 l ., an action was raised against him by the trustees of Sir James Montgomery, then deceased, for payment of the amount due and for avoiding the lease, and decreet was obtained, declaring the lease to be at an end, and ordaining removal from the premises. On being charged, in virtue of the sheriff's precept, to remove, Lyon applied to John Reid, with whom he had

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“Edinburgh, 14th July 1815.—Received by me, factor for Sir James Montgomery's trustees, from Mr. John Reid, writer in Edinburgh, the sum of 218 l . 17 s . 4 ½ d . sterling, in payment of the annexed account of rents, and interest, due by Peter Lyon, druggist in Edinburgh, to said trustees; to the extent of which sum I oblige the said trustees to grant you an assignation to said rents and diligence, but upon your own expences.”
In the same month Reid junior drew and extended an assignation by the trustees in favour of Reid senior, on the narrative of the lease and trust deed in their favour, the falling into arrear, the above-mentioned payment, and stating that in respect thereof the trustees suspended the ejectment of Lyon from the premises, and waived the effect of the irritancy incurred and declared by the decree at their instance, and agreed to assign the same to Reid senior, as a collateral security to him against Lyon, and his heirs and successors, for the reimbursement of the sum so advanced and paid to the trustees by Reid, and future interest and expences which should ensue thereupon, but always under the qualities and conditions after specified: and the assignation then proceeded, “we (the trustees) do hereby not only acknowledge the receipt from him of the said sum of 218 l . 17 s . 4 ½ d . sterling, but also assign and convey to him, and his heirs and assignees, the aforesaid decree and precept of the 15th of March last, and execution thereof of the 23d of May last, and sums thereby due,

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Next day Lyon executed an ex facie absolute assignation (drawn by Reid junior) in favour of Reid senior, narrating the contract of lease, the circumstances which had led to the lessee's pecuniary embarrassments, and then stating that the trustees “brought an action before the sheriff of Edinburgh against me of irritancy of the lease, and for payment of the arrears of rent, interest, and expenses; and on the 15th day of March last obtained decree of declarator of irritancy, and forfeiture of said lease, and for payment of said arrears, interest, and expences, and also for removing and ejecting me, my family and dependents, from the premises; and on the 23d of May last I was served with an execution to the effect aforesaid, but by the interposition of friends, the pursuers were prevailed upon to postpone my actual ejection: and whereas John Reid having,

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“In respect you have this day delivered to me the assignation by Peter Lyon to Mr. John Reid, late of the Tontine, Glasgow, of the lease of Comely Garden, granted by the late Lord Chief Baron Montgomery to Mr. Lyon, duly intimated to the trust-disponees, upon condition that the said John Reid, who paid up the arrears due at Candlemas last, shall grant an obligation for the punctual payment of the rent of this and the four subsequent crops, which I engage to procure and exchange with this, otherwise shall stand bound to the same effect to the said trust-disponees; and remain,” &c.
Lyon continued in possession of the premises until June 1826, when he died; but it was alleged that the rents had been paid by Reid senior.A few months before Lyon's death, John Reid junior, upon a requisition by Grant, solicitor for Lyon, for a statement of the nature and extent of Reid senior's

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In defence Reid senior contended, that the decree obtained by the trustees of Sir James Montgomery became final, and that Peter Lyon's right to the lease was thereby terminated for ever; and further, that the assignation was absolute and not by way of security; and that this was evident from the circumstances of the case.A supplementary action was subsequently brought by the pursuer, who had erroneously served himself heir of conquest, in place of heir in general; but which mistake he rectified by being served in the proper character.

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The Lord Ordinary conjoined the two actions, and found, “that although the assignation by the late Peter Lyon, the pursuer's grand-uncle, to the defender, of the lease in question, bears to be an absolute conveyance, it is proved by the admitted facts and circumstances of the case, and the written evidence produced, to have been intended and understood by the parties merely as a security for repayment of certain arrears of rent advanced by the defender to the trustees of the late Sir James Montgomery the landlord, for behoof of the tenant, Peter Lyon; therefore finds and declares, that the pursuer, in right of his grand-uncle, is entitled to succeed to the lease; that the assignation by Peter Lyon to the defender is redeemable by the pursuer, on repayment of the sum of 218 l . 17 s . 4 ½ d ., the sum advanced at the date of the assignation, and whatever other sums the defender can instruct that he advanced for the said Peter Lyon, on the faith of the security, with interest at the rate of five per cent, from the date of the said advances respectively till payment, together with the expences incurred by the defender in the transaction; and allows an account of the said advances, interest, and expences to be given in.”May 25, 1830.On appeal to the First Division, their Lordships, without hearing the pursuer's counsel, refused the desire of the reclaiming note, and adhered to the interlocutor of the Lord Ordinary, and found the defender liable in the expences incurred since the date of the Lord Ordinary's interlocutor; and remitted to his Lordship, to modify and decern for the same * .

Footnote

* 8 Shaw and Dunlop, 789.

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June 17, 1830.Afterwards the Lord Ordinary modified the expences, and found, decerned, and declared against the “defender in terms of the libel, upon payment being made to the defender of the sum of 1,217 l . 19 s . 7 d. sterling, being the balance due by the pursuer to the defender upon the state of the payments of rents, &c. made by the defender upon the faith of the security in question, with interest on the amount of the defender's advances from 2d February 1827, at the rate of five per cent., till payment; finds the pursuer entitled to the expences incurred by him in the conjoined actions; but, in respect that the first summons was rendered unnecessary by the pursuer's claiming as heir of conquest, finds him not entitled to the expence of that summons, or the proceedings occasioned by the pursuer's claiming in the said character; appoints an account thereof to be given in, and remits to the auditor to tax and to report.”Jan. 21, 1831.Feb. 4, 1831.The defender reclaimed, and maintained that it was incompetent for the Lord Ordinary to award any expences of the Outer House prior to the date of the interlocutor of count, by which only the expences of opposing were found due; but the Lords adhered to the interlocutor complained of, and refused the note, and found the complainer liable in farther expences * , which they afterwards decerned for.Reid senior appealed.Appellant. —It was never intended or understood, when the appellant acquired right to the lease in

Footnote

* 9 Shaw and Dunlop, 308.

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The appellant has good ground of complaint of the way the suit has been allowed to be conducted. The inept summons should have been at once dismissed; and it was irregular to conjoin an incompetent with a competent process. It was equally irregular to find him liable in expences.Injustice is done to the appellant, even on the assumption that the respondent could establish his pretended right to the lease in question. He is not fully indemnified by the mere return of the sum, with interest, advanced. He is entitled to more.Respondent .—The respondent has a good right and title to insist on the present action. The conjunction of the processes was agreeable to practice, and quite in form, and the award of expences regular.The assignation was merely in security, and not an absolute conveyance, which is quite plain from the facts of the case, and amply supported by documentary evidence.Lord Chancellor . —My Lords, this case brings before your Lordships an appeal from six different interlocutors of the Lord Ordinary and the First Division of the Court of Session. I do not feel it to be necessary to enter at large into the circumstances of the case, nor assign reasons for the judgment I am about to recommend to your Lordships to pronounce. The point to which the argument has directed the attention

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This was the residue of a term of 500 years of very valuable property, consisting of six acres in the immediate neighbourhood of Edinburgh. The consideration paid at the period of the execution of the assignation, it appears, was 218 l . 17 s . 4 d .; and the interlocutor of the Lord Ordinary, affirmed by the Court, has held, on the account which was taken, that it was redeemable on the payment of 1,217 l . 19 s . 7 d ., the principal and interest, the assignation being a security for the sum originally advanced, and the interest upon it to the date of payment. It is alleged that the property is worth no less than 5,000 l . That precise value is, in terms, denied on the opposite side, but the denial is very loose; the utmost extent to which it goes is, that it is not so valuable. That may be taken to mean that it is not quite so valuable; but the appellant does not go on to say that it is not of much more value than the sum advanced, with the interest which has accrued upon it.My Lords,there was an exception in respect of the expenses, but the appellant has no good ground of complaint there, as the expenses of the first, the incompetent summons, were not given against him. It is not necessary to enter into those circumstances. It is sufficient, upon the whole, to state to your Lordships, that I am, on consideration of the case, quite satisfied that the judgment of the Court below is right, and that I would advise your Lordships to affirm the several interlocutors complained of; but as the case has appeared to me not

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The House of Lords ordered and adjudged, “That the appeal be and is hereby dismissed this House, and that the interlocutors therein complained of be and the same are hereby affirmed.”Solicitors: Richardson and Connell— Macqueen,—Solicitors.