Scottish Court of Session Decisions

Lord Adam—This is an action raised by Lady Ross against her son Sir Charles Ross for arrears of annuity due on Martinmas 1893 and Whitsunday 1894. No question arises about the annuity being due, but the defender pleads compensation in respect of certain debts said to be due to him by her, and these claims against her seem to be at present illiquid. Now, the Lord Ordinary has decerned in terms of the conclusions of the libel. We have no note to his opinion, but no doubt he followed the well-established rule that illiquid claims cannot be compensated or set off against liquid claims, and as the late Lord President said in the case of Munro, to which we were referred, I would be very unwilling to cast any doubt whatever upon such a well-established rule. But, as appears in that case, the rule is not without some exceptions, and it appears to me that there may be cases in which it is not desirable or necessary that immediate decree should be given for the sum claimed. Now, I think this is a very exceptional case. The defender's father died so long ago as 1883, and the pursuer then became sole tutrix and afterwards curatrix to her son, and had the sole management of the estates. The estates amount, as to annual rental, to something over—I suppose the gross rental—£16,000 a-year. Now, the defender came of age in 1892, and the result of the lady's administration is that for the ten years during which she had the sole administration of these large estates, she brought out a debit balance against him of some small amount. That is rather a startling fact. In the first place, this lady was bound in her character of tutrix and curatrix to her son to have kept clear accounts of her administration. I have looked at the accounts originally lodged. They may be right or they may be wrong; I have nothing to do with that; but I observe that there is one item in these accounts, namely, an amount of about £38,000, which she charges against her sou, and in a note with reference to that large sum of money she says, that that is the expense of keeping up the establishment, and adds—“I have no account to give of that large sum; I have no vouchers.” She says that herself, and this lady, who has been acting in that capacity, brings these accounts into Court in that condition. She has also complicated matters by having let to herself several farms on the estate, and that is the way this lady has administered the estate of her son. Besides that, her husband, the late Sir Charles Ross, disponed in her favour his whole moveable estate, and her son has raised an action for legitim against her. Accounts have been put in in that action too. of course I am not going to criticise the accounts, but I see from the abstract of her accounts that the gross value of the personal estate was stated to be £46,000 odds, and the debts which she charges against it amount to £42,000, leaving a balance to be divided into two sums of £3700. But in looking at the accounts I find entered a charge against her son of the value of an annuity of £2000 per annum in favour of the defender in terms of marriage-contract and bonds of provision calculated at 3 1 2 per cent.—£28,840. That appears to me simply to come to this, that in that action she is claiming to retain the very sums for which she is now suing. These are, what I venture to say, circumstances so very exceptional that I do not think it would be consonant with justice to give this lady immediate decree for the sum she claims. I would therefore suggest to your Lordships to follow the course taken in the case of Munro, and supersede disposal of this reclaiming note until there should be some change of circumstances which would enable us more satisfactorily to dispose of it. I therefore propose that, without recalling the interlocutor of the Lord Ordinary, we should in the meantime supersede consideration of the reclaiming note, leaving it to either party to move when such change of circumstances occurs.

Lord M'Laren — In disposing of the pleas in this case I think that the Lord Ordinary has rightly dealt with the plea of compensation, because that is a matter of statutory regulation, and the plea is confined to cases where both debts are liquid or capable of immediate ascertainment; but then there is another principle under which one obligation may be suspended until the performance of a counter-obligation—the principle of retention, and that, not being subject to the conditions of any statute, must be regarded as an equitable right to be applied by the Court according to the circumstances of each case as it shall arise. The doctrine has received much extension in cases of

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