John Hunter, W. S. - Dr. Lushingto - Anderson v. Mrs. George and Others, Trustees of the late James George - Lord Advocate (Jeffrey - Murray [1834] UKHL 7_WS_333

UKHL
John Hunter, W. S. - Dr. Lushingto - Anderson v. Mrs. George and Others, Trustees of the late James George - Lord Advocate (Jeffrey - Murray
[1834] UKHL 7_WS_333 · 1834-05-13
Circumstances under which it was held, without reference to oath (affirming the judgment of the Court of Session), that a party was not an onerous bonâ fide holder of a bill, and that the bill having been granted without value, he was not entitled to recover.

Subject_ Process. —

Question as to the competency of the Inner House in the Court of Session, in reviewing an interlocutor of a Lord Ordinary which does not exhaust the cause, pronouncing a new one which has that effect.Charles M'Donald acted for some time as agent in Huntly for the Aberdeen Banking Company. On the 2d of January 1830 he applied to Alexander Reid and James George for their joint acceptance for 160 l ., which they granted; and at the same time he addressed a letter to Reid, in these terms:—
“Sir, Huntly, January 1830.
Having this day received your and Mr. James George's acceptance to me for 160 l . sterling, payable

Page: 334 ↓

I am, &c.

Charles M'Donald .”

“Mr. Alexander Reid.”

Two days afterwards a bill for 200 l . was accepted by Reid and George in favour of M'Donald, and the former bill was thereupon destroyed. On this occasion M'Donald addressed to Reid a letter in these terms:—
“Sir, Huntly, 4th January 1830.
I have this day received your and Mr. James George's acceptance to me for 200 l . payable twelve months after date, which bill I promise to pay when due. I am, &c.Charles M'Donald ”.

“Mr. Alexander Reid.”

These letters were given by M'Donald to Reid. M'Donald was at this time deeply indebted to the bank, and they took possession, on the 6th, of the whole books and papers which could be found in his office; and on the following day he executed a trust disposition for behoof of his creditors in favour of the bank. The appellant, (who was the brother-in-law of M'Donald, and acted as his law agent,) admitted that some days after the seizure of the papers by the bank he went to Huntly, and then became aware that M'Donald had executed a trust deed, but he denied that he was at that time made acquainted with the terms of the deed. He also admitted that the bill for 200 l . was indorsed to him by M'Donald posterior to the execution

Page: 335 ↓

James George died in July 1830, and the bill fell due on the 7th of January 1831, by which time Reid had become bankrupt, and it was not then protested. About three months after it fell due Hunter raised an action before the Court of Session against the respondents as the representatives of James George, concluding for payment of the contents of the bill for 200 l . In defence the respondents pleaded that Hunter was not an onerous bonâ fide holder, and that as it was proved by the letter of 4th January 1830 that the bill was an accommodation one to M'Donald, he had no right to recover. The Lord Ordinary, on the 2d of February 1832, pronounced this interlocutor:—
“Finds, in the circumstance of the case as admitted by the pursuer, that he is not entitled to the privileges of a bonâ fide and onerous indorsee; but in respect that the defenders do not found upon the letter from M'Donald, the drawer, to Reid, as conclusive evidence that the bill was an accommodation to the drawer, in so far as George was concerned, but refer to books and other documents on this subject, remits to Mr. Joseph M'Gregor, accountant in Edinburgh, to examine the said books and documents, to call for such others as may be competent to produce, to hear parties, and thereafter to report to the Lord Ordinary; and in the meantime appoints intimation of the dependence of the action to be made to the Aberdeen Banking Company.”
Both parties reclaimed; the respondents praying to be assoilzied, and the appellant that the interlocutor should

Page: 336 ↓

The Court, on the 24th May 1832, pronounced this interlocutor:—

“Recall the interlocutor of the Lord Ordinary, in so far as it proceeds on the ground of the defenders having declined to found on the letter from M'Donald to Reid; also recall the remit to Mr. M'Gregor, accountant, as unnecessary; and in respect that by the foresaid letter the bill libelled on is proved to have been signed by James George only as an accommodation bill, and that the pursuer is not entitled to the privileges or character of an onerous indorsee, assoilzie the defenders from the conclusions of the libel, and decern: Find the pursuer liable to the defenders in expenses, &c.” *
The appellant then presented a petition to the Court, maintaining that the interlocutor was ultra vires, in respect that it exhausted the whole merits of the cause, which it was alleged was incompetent, seeing that the cause was brought before the Court for review of an interlocutor of the Lord Ordinary, which did not exhaust the cause, and not by a report on cases. The Court, on the 1st June 1832, refused the petition with additional expenses. †Hunter appealed, contending that the interlocutor of the 24th May 1832 was incompetent; that there were no circumstances sufficient to justify the finding that he was not an onerous bonâ fide holder, and that the letter

Footnote

* 10 S. & D., p. 561.† 10 S. & D., p. 604.

Page: 337 ↓

On the other hand, the respondents maintained that it was in the power of the Court, when reviewing the judgment of a Lord Ordinary, to alter it, and to decern or assoilzie as they saw fit; that the admitted facts that the appellant was the brother-in-law and the law agent of M'Donald, and that he had got the bill after he knew that M'Donald had a trust disposition, and that he gave no present value, were sufficient to show that he was not an onerous bonâ fide holder; and that although the letter was addressed to Reid, it established the fact that the joint acceptance was for the accommodation of M'Donald.Lord Wynford .—My Lords, this is an action by Hunter, the indorsee of a bill of exchange, against the representatives of one George, who was, along with one Reid, an acceptor of that bill. The defenders alleged that the bill was drawn for the accommodation of the drawer M'Donald, in support of which they produced a letter from the pursuer Hunter to Reid, and they pleaded that the pursuer was not entitled to the privileges of a bonâ fide and onerous indorsee. The Lord Ordinary found, that in the circumstances of the case, as admitted by the pursuer, he was not entitled to these privileges; but he also found, that the defenders did not refer to the letter from the pursuer to Reid as conclusive evidence that the bill was an accommodation to M'Donald, the drawer, in so far as George was concerned, but referred to it along with books and other documents; and he therefore remitted the case to an accountant, to examine these books and documents, and call for such others as might be competently produced,

Page: 338 ↓

Page: 339 ↓

Page: 340 ↓

Page: 341 ↓

Footnote

* Nov. 25, 1824 (3 S. & D., new ed. 230.)

Page: 342 ↓

The House of Lords ordered and adjudged, That the said petition and appeal be and is hereby dismissed this House, and that the interlocutors therein complained of be and the same are hereby affirmed: And it is further ordered, That the appellant do pay or cause to be paid to the said respondents the sum of 200 l . for their costs in respect of the said appeal.Solicitors: Spottiswoode and Robertson— D. M. Johnston, Solicitors.