Scottish Court of Session Decisions

Thomas Ross and Simon Lundy, who were the sole partners of the Rosslund Cycle Company, otherwise the Roselund Cycle Company, cycle agents and repairers, 24 Bridge Street, Girvan, on 1st April 1905 accepted a bill of exchange drawn upon them by Andrew M'Creadie, and payable three months after date. The bill bore the individual signatures of Ross and Lundy, and contained no reference to the Rosslund Cycle Company. On 4th July M'Creadie protested the bill for non-payment. On 10th July under an extract registered protest and warrant, dated 7th July, M'Creadie charged Lundy and Ross to pay him the sum contained in the bill, and on 18th July, the days of charge having expired, he poinded a quantity of goods at 24 Bridge Street, Girvan, the property of the company.

Thereafter the Rosslund Cycle Company, otherwise the Roselund Cycle Company, Cycle Agents and Repairers. 24 Bridge Street, Girvan, and Thomas Ross and Simon Lundy as the sole partners of said company, brought a petition in the Sheriff Court of Ayrshire at Ayr against M'Creadie, craving the Court to “interdict the defender, and all others acting for him, or under his instructions, from selling, removing, disposing of, or in any way interfering with the goods, gear, and effects, or any of them, belonging to the pursuers, and in the premises at 24 Bridge Street, Girvan, under and in virtue of (1), an extract registered protest from the Sheriff Court books of Ayrshire, and warrant of the Sheriff of Ayrshire thereon, dated 7th July 1905, and (2), warrant of sale, granted by the Sheriff-Substitute of Ayrshire at Ayr on 27th July 1905, following upon the foresaid extract registered protest and warrant thereon, and expired charge given thereunder.”

The pursuers averred that the bill was accepted by Ross and Lundy in their individual capacities.

They pleaded, inter alia—“(2) The effects in question being the property of the pursuers the Rosslund Cycle Company, otherwise the Roselund Cycle Company, and they not being the debtors named in the said extract registered protest and warrant thereon, and warrant of sale following thereupon, the poinding of said effects is illegal and unwarrantable, and their sale ought to be interdicted and decree granted in terms of the prayer of the petition.”

In the course of a proof taken by the Sheriff-Substitute ( Shairp), it was proved that the bill was granted in consideration of an advance made by M'Creadie to enable Ross and Lundy to obtain stock-in-trade and tools for their business.

On 17th July 1906 the Sheriff-Substitute pronounced the following interlocutor:—“Finds in law (1) That in terms of the Bills of Exchange Act 1882, section 100, it is competent to prove by parole evidence whether in granting the bill the pursuers intended to bind themselves both as individuals and as the sole partners of the ‘Rosslund’ or ‘Roselund’ Cycle Company, carrying on business in Girvan: (2) Finds in fact that it has been proved by the evidence adduced that the pursuers granted the bill in question with the intention of binding themselves both as individuals and as sole partners of the foresaid firm, and did so bind themselves and said firm: (3) That the subsequent procedure taken by the defender upon said bill has been regular, and that the poinding which followed was duly executed and attached the effects of said firm. … Therefore refuses the prayer of the petition.”

The pursuers appealed, and argued—The poinding and sale were illegal. The debt was the debt of the individuals Ross and Lundy, and the goods were the goods of the company— Jack v. M'Caig, January 16, 1880, 7 R. 465, at 468, 17 S.L.R. 351. Under the Debtors (Scotland) Act 1838 (1 and 2 Vict. cap. 114) it was illegal to sell a debtor's goods without having first charged him to pay. It was now proposed to sell the company's goods, the company never having been charged, the only persons charged being the two individuals Ross and Lundy. Diligence was a matter strictissimi juris and could only proceed where nothing was doubtful and everything regular ex facie — M'Rostie v. Halley, March 2, 1850, 12 D. 816; Whitehead v. Henderson, February 19, 1836, 14 S. 544; Summers v. Marianski, December 16, 1843, 6 D. 286; Fraser v. Bannerman, June 21, 1853, 15 D. 756. It could not be left to a messenger-at-arms to decide for himself such a question as whether or not the company and the two individuals were the same. That was the class of question which could only be proved in a separate action— British Linen Company v. Alexander, January 14, 1853, 15 D. 277. The case of Plotzkers v. Lucas, 1907, S.C. 315, 44 S.L.R. 245, was also referred to by way of illustration.

Argued for the respondent—All the cases referred to by the appellants were cases in which there was some defect on the face of the bill. Here there was none, and there was nothing to prevent him doing diligence against any property which was the joint property of the two individuals, and the two individuals only. If there had been a third partner in the company the

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matter would have been different— Parnell v. Walter, July 3, 1889, 16 R. 917, Lord Kinnear at 924, 27 S.L.R. 1. The fact that they chose to call themselves the Rossland Company was quite immaterial. But in any event the present action was incompetent. The Sheriff having granted a warrant to sell it was incompetent to ask him to interdict proceedings under that warrant. The pursuers should have appeared in the poinding and objected there— Lamb v. Wood, July 20, 1904, 6 F. 1091, 41 S.L.R. 825. Thereafter the only competent action would have been a suspension and interdict in the Court of Session—Mackay's Practice, vol. ii, 211; Graham Stewart on Diligence, p. 354, and cases there cited.