Scottish Court of Session Decisions

Subject_1 FRAUD.
Subject_2 SECT. III.

Underhand dealing.

Paterson
v.
Edward

Date: 27 November 1629
Case No. No 16.

A merchant disponed his effects to certain creditors, and the day after delivery he left the country. In a competition between the disponees and other creditors, who had arrested on the day the bankrupt fled, the former were preferred, though the disponees were relations of the bankrupt.

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John M'Cubbie being debtor to divers of his creditors, for satisfying of debts owing to Nicol Edward, Mr Robert Balcanquhel, and others, he makes them a disposition of the merchant-wares which he had in his merchant-booth, valued to a sum exprest in the disposition, whereby also all other his goods are disponed to them for their relief; and about 20 days after the said disposition, he on the night delivers the saids goods in the merchant-booth, and on the morrow becomes fugitive; and on that morrow Thomas Paterson arrests the same wares in the said Nicol Edward's hands, and pursues to make them furthcoming; and they defending them with the said disposition, and tradition before the arrestment, as being done for an onerous cause, for a true and just debt, which they instructed, the Lords found that they had right, and not the arrester to the said goods, in respect of the said disposition, and delivery to them, all done before the arrestment, and done to a true creditor, for a just and preceding debt, which was greater than the goods delivered in price and value extended to; neither was it respected where the pursuer replied that it was a disposition omnium bonorum, done to a conjunct person betwixt a brother-in-law, and the disponer retaining possession thereof, while the night before he fled, and done in meditatione fugæ, and voluntarily without diligence or compulsion, and done to the prejudice of all other creditors, who were abused by the fraud of their debtor, keeping still his wares in his public booth, whereby they were put in security, while that mid-night before the day immediately wherein he fled, he delivered the said goods; which abuse, and clandestine doing was not at any time lawful; for such acts ought not to be useful to the receiver, by the common debtor's preferring of him voluntarily to the rest, who were deceived by the said clandestine deed; the disposition never being registrated, nor possession apprehended, by instrument or order of law, nor in due time convenient thereto; the pursuer by the contrary having done diligence by arrestment, upon the first day following the night of tradition, and that same day when the debtor fled; which reply was repelled, and the exception sustained, seeing neither before the disposition nor tradition, the pursuer nor no other creditor had done any diligence against the common debtor, in any manner of way; and the common debtor was never charged, nor rebel, at the disponing or tradition foresaid, without which preceding diligence, the act of divory met not the case.

Act. Advocatus et Nicolson. Alt. Stuart et Mowat. Clerk, Gibson. Durie, p. 471.