ceased to be worked, and were not under lease at the date of his death.

Held that the trustees were entitled to lease such portions without the consent of the person to whom the estate was to be conveyed upon the expiry of the liferent, and that the liferentrix was entitled to the rents derived therefrom.

Case of Campbell's Trustees v. Campbell, March 15, 1882, 9 R. 725, aff. July 6, 1883, 10 R. (H. of L.) 65, distinguished. The late Sir William Baillie of Polkemmet, Baronet, died on 21st July 1890 without issue, survived by his wife. He left a trustdisposition and settlement dated 10th April 1889, which contained, inter alia, the following provision --"Second, My trustees shall, from and after my death, hold my estate of Polkemmet, comprehending the whole lands, teinds, and other heritages in the county of Linlithgow belonging to me for the liferent use of Dame Mary Baillie, my wife, in the event of her surviving me, and they shall pay to her during her lifetime the free annual proceeds of said estate and of minerals therein, and allow her to occupy the mansion-house, offices, and policies."

A special case was submitted to the Court by the trustees of the first part, Dame Mary Baillie, the widow, of the second part, and Sir George Baillie, Baronet, to whom the estate of Polkemmet was to be conveyed upon the death of the liferentrix, of the third part, which set forth the following facts-At the date of the said trust-disposition and settlement the minerals in certain portions of the estate of Polkemmet were let, and were being worked by the tenants thereof. These leases were still in force, and the minerals had been worked under them down to the present time. The first parties had recently received an offer from Messrs Robert Addie & Son for a trial lease of the minerals in certain other portions of the lands of Polkemmet. In the event of minerals being found which Messrs Addie might wish to work, they stipulated for a lease of thirty-one years from Martinmas 1892 at certain fixed rents, ranging from £200 to £400 per annum for the different periods therein specified, or in lieu of these fixed rents, in the option of the first parties, the lordships therein mentioned. The portions of the estate of Polkemmet referred to in the foregoing offer were the farms of Burnbrae, Swineabbey, East Whitburn, and West Foulshiels. The minerals in Burnbrae were let by the late Sir William Baillie for thirty years from Whitsunday 1857, with a break in favour of the tenant at the end of every third year for a fixed rent of £100, or in lieu thereof certain lordships. The tenant entered into possession and worked the minerals until 1865, when he gave up the lease. There was subsequently another lease of the Burnbrae minerals for twenty-four years from Martinmas 1873, but the lease was abandoned on the tenant's bankruptcy in 1881. The pit upon the farm still remained open, and could easily be made available for

working. The minerals in Swineabbey were let by Sir William Baillie in 1857, at the same time as those in Burnbrae, and to the same tenant, but the tenant, after making borings to prove the mineral field, gave up the lease in terms of a reserved power to that effect without having worked the minerals. Again, in 1867, Sir William Baillie accepted a proposal for a thirty-one years' lease of the minerals in the farms of Burnbrae and West Foulshiels, and in 1886 he accepted a proposal for a twenty-five years' lease of the minerals in, inter alia, the farms of West Foulshiels, East Whitburn, Swineabbey, and Burnbrae. In each case the tenant gave up the lease after proving the mineral field without having worked it.

The opinion of the Court was requested upon the following questions of law-"(1) Have the first parties power to let the minerals in the portions of the estate of Polkemmet referred to for a period not exceeding thirty-one years (1st) without the consent of the third party, or (2nd) with his consent? (2) In the event of either alternative of the first question being answered in the affirmative, is the second party entitled to receive during her lifetime the free lordships or rents of the minerals in the said portions of the estate of Polkemmet?"

Argued for the first and second partiesThe trustees were entitled, under the Trust Act 1867 (30 and 31 Vict. c. 97), sec. 2, subsec. 3, to enter into the lease proposed, and the liferentrix was entitled to receive the rents. The case of Campbell's Trustees v. Campbell, March 15, 1882, 9 R. 725, aff. July 6, 1883, 10 R. (H. of L.) 65, relied on by the third party, was clearly distinguishable in several points-(1) the word was here "proceeds," and not merely "produce or fruits; (2) "minerals" were explicitly mentioned; (3) the parts it was proposed to work had been opened by the testator; which (4) gave an "irresistible indication of the testator's intention there desiderated by Lord Blackburn.

Argued for the third party-This case was ruled by that of Campbell, and the arguments there submitted applied. The testator knew when he made his will what parts of his estate were yielding mineral rents. It was not to be presumed that he wished his widow to have more even if the fields were opened up. There was not here the clear intention desiderated in Campbell's case, and the words employed were not really of a wider scope.

At advising

LORD JUSTICE-CLERK-In this case we have to decide the effect of the provision for the widow of the testator contained in the second purpose of his settlement"My trustees shall, from and after my death, hold my estate of Polkemmet, comprehending the whole lands, teinds, and other heritages in the county of Linlithgow belonging to me, for the liferent use of Dame Mary Baillie, my wife, in the event of her surviving me, and they shall pay to her during her lifetime the free annual proceeds of said estate, and of minerals

therein, and allow her to occupy the mansion-house, offices, and policies.

The statement of facts in the case brings out that at various times during the lifetime of Sir William Baillie the minerals had been opened up and leases given. It also appears from the statement of the case that the working of these minerals did not turn out profitably for the tenant, and that the tenant ceased to work them, and that the pit upon the farm still remains open and could easily be made available for working. That applies to the Burnbrae minerals and the Swineabbey minerals, and the question which is put to us is, whether the trustees have power to let these minerals fields which have already been opened up without the consent of the heir who is ultimately to succeed to the estate, or with his consent?

Now, the first question of course is, whether they have the right or not. This case is peculiar in this respect, that the settlement contains the express declaration that the widow is to have the free annual proceeds of the estate and of the minerals therein; and the only question put to us is, whether the mineral fields that have been already opened upare available to her as part of her liferent-whether the trustees are entitled to carry on the working of these mineral fields by letting them and to give the widow the benefit of these mineral fields. It seems to have been pretty clearly and distinctly laid down in the case of Campbell. I read from the opinion of the Lord President in the case of Campbell's Trustees, 1882, reported in 9 R. 725, "that where a mineral field has been opened up and made part of the fruits of the soil, or has provided an income during the lifetime of the testator, the liferenter of the estate is entitled to continue to have those fruits as part of the free income of the estate," but that where they have not been opened up in the lifetime of the testator, and the minerals have not practically become part of the fruits of the soil, then the liferenter is not entitled to enjoy them.

Now, I think, giving the best consideration I can to the facts stated here, that the widow is entitled to the benefit of the fruits of these fields that were opened up. They were opened up during the lifetime of the testator. He drew the fruits as long as the tenant was able to pay them. Local or temporary circumstances may have prevented the tenant carrying on the work at a profit, and they may have been stopped for a time, but they were opened up in the lifetime of the testator, and to bring the doctrine in Campbell's case, where the testator has given the liferent of the minerals as he has expressly done in the second head of his settlement, it is difficult to see what minerals he could have meant unless it was the mineral fields already opened up or the whole minerals. Now, it is not necessary to decide whether the trustees could open up any new mineral fields in any other part of the estate. That is not the question put to us. The question is, whether they have power to let the minerals on the estate

referred to in the case, and on that matter I have come to the opinion that they are so entitled, the widow being entitled under the deed to the proceeds of the minerals, and these minerai fields having been opened up. The only other question is, whether the consent of the third party is necessary? and I am of opinion that the consent of the third party is not necessary, the question being of the nature I have indicated, and the law laid down in the case of Campbell being as I have stated. Therefore I think we should answer the first question in the negative, and the second in the affirmative.

LORD YOUNG concurred.

LORD RUTHERFURD CLARK-I had some difficulty about this case, but on the whole I concur.

LORD TRAYNER-By the trust-deed of the late Sir William Baillie his trustees are directed to hold the estate of Polkemmet for the liferent use of the second party, and to "pay to her during her lifetime the free annual proceeds of said estate, and of minerals therein." A direction to the trustees to pay to the second party the free annual proceeds of the estate for her liferent use would have entitled her to the rents or royalties derived from minerals which had been opened up and worked during the truster's lifetime; and I take it that something more was intended to be given to the second party by the addition of the words "and of minerals therein." Whether that would entitle the second party to insist that mineral fields should now be opened up which the truster had not worked or leased, or shown any intention to work or lease during his lifetime, in order that she might receive the rents or royalties thereof, I do not say, but I think there is here an expression of the truster's intention (which was wanting in the case of Campbell) that the second party should take under the provision of the trust-deed rents or royalties of minerals beyond what would have been carried by an ordinary liferent provision. In the circumstances stated in the special case before us, I think it is reasonable to connect that intention with the minerals which had been let by the truster, or which he had agreed to let, during his lifetime, and which there was ground for believing would be worked by other tenants than those who had taken them or agreed to take them from the truster but had not worked them out or even worked them at all. For these reasons I concur in thinking that the questions put to us should be answered in the manner proposed.

The Court found that the first parties were entitled to let the minerals in the portions of the estate of Polkemmet referred to without the consent of the third party, and answered the second question in the affirmative.

Counsel for First and Third PartiesW. Campbell.

Council for Second Party-H. JohnstonMacfarlane.

Agents for First, Second, and Third Parties-Tods, Murray, & Jamieson, W.S.

Tuesday, December 8.

FIRST DIVISION.

[Lord Kincairney, Ordinary. STUART & STUART v. MACLEOD. Sequestration - Contingent Debt - Bankruptcy Act 1856, sec. 14-Crofter-Crofters Holdings Acts 1886 and 1887.

A creditor applied for sequestration of his debtor, founding on a debt constituted by extract decree. The debtor lodged a minute stating that the decree had been granted for payment of the arrears of rent of a croft occupied by him, and that he had applied to the Crofters Commission to fix a fair rent therefor, and to determine the amount of arrears payable by him. He craved the Court to dismiss the petition for sequestration in respect that the debt founded on was contingent.

The Court held that the debt was not contingent, in respect that it had been decerned for as arrears of rent of an inn let to the debtor separately from his holding as a crofter.

Opinions by Lord Adam, Lord Kinnear, and Lord Kincairney, that arrears of rent for which decree has been granted against a crofter are a contingent debt where the crofter has applied to the Crofters Commission to fix a fair rent for his holding.

Opinion by Lord M'Laren, that where a dispute arises between a landlord and tenant as to whether the latter is or is not a crofter, that dispute is outside the jurisdiction of the Crofters Commission, and can only be determined by the ordinary courts of the country. Sequestration-Discretion of Court-Bankruptcy Act 1856, sec. 30.

Opinion per curiam-following opinion of Court in Joel v. Gill, 21 D. 929that in awarding sequestration the Court is not exercising any discretion, but must award it where the statutory requisites are complied with.

This was a petition for the sequestration of Donald Macleod, residing at Scuir Inn, Island of Eigg, presented by Messrs Stuart & Stuart, W.S., the amount of the debt sworn to being £77, 18s. 7d.

The circumstances in which the application was made were as follow:-On 30th June 1890 Norman Macpherson, LL.D., advocate, Edinburgh, and Miss Isabella Macpherson, Miss Margaret Macpherson, and Miss Anna Maria Macpherson, proprietors pro indiviso of the Island of Eigg, brought an action against the said Donald Macleod for payment of £52, 10s., with interest thereon from the date of citation until payment.

The pursuers averred-"(Cond. 1) The pursuers are proprietors pro indiviso of the Island of Eigg, . . . and the Scuir Inn, of which the defender is tenant, is situated in the Island of Eigg, and forms part of the pursuers' said property." "(Cond. 2) Upwards of fifty years ago the house now known as the Scuir Inn was the house of the tenant of the farm of Galmisdale. That farm having fallen out of lease some forty or fifty years ago, it was divided among crofters, and the farmhouse was let to defender's father, the late Allan Macleod, as an inn, in place of the small cottage near the seashore then occupied by him as such. There was also at same time let to Allan Macleod a croft in Galmisdale, which is now in possession of the defender. The two subjects were let distinctly, and separate rents paid therefor. Subsequently the pursuers prohibited the said Allan Macleod from selling spirituous liquors in the inn, and in respect thereof let him occupy the house rent free. When in 1878 it was found that the inn had fallen into disrepair, and become insufficient for the requirements of the island, the pursuers at a very considerable outlay improved the house and put it into thorough repair, and agreed to give the said Allan Macleod and defender a lease thereof for three years at £15 per annum. . . . No formal lease was prepared, but the arrangement come to under the letter and minute was acted on, the proprietors repairing and adding to the house, and Allan Macleod and the defender regularly paying the agreed-on rent of £15 per annum, and that over and above and distinct from the rent of the croft in Galmisdale, £14 per annum. The explanation in answer is denied." In Cond. 6 they averred that the defender had paid no rent for said inn since Martinmas 1886, while he had paid regularly the rent of his croft in Galmisdale, and that he was accordingly due the sum sued for, being the seven halfyearly rents due for the inn from Whitsunday 1887 to Whitsunday 1890.

The defender in answer averred-"Admitted that upwards of fifty years ago the house called by the pursuers the Scuir Inn was the dwelling-house of the tenant of the farm of Galmisdale; that the said farm was then divided into crofts, and that the defender's father became a tenant of one of these. Quoad ultra denied. Explained that the defender's father having leased the largest croft, there was let along with it to him the said dwelling-house, which was thereafter occupied by him and subsequently by the defender. The pursuers made certain improvements on the dwelling-house about the year 1878, on the footing of a verbal agreement with the defender whereby he undertook to pay 5 per cent. on the cost after the repairs were executed. The pursuers represented that they had expended £300, and charged the defender £15 per annum of additional rent for said croft and dwelling-house. The defender and his father always complained against that increase as excessive. Admitted that the defender has continued in the occupancy of his croft and dwelling

house, and that he refuses to pay the additional rent of £15. Explained that he has applied to the Crofter Commissioners, under the Crofters Holdings (Scotland) Act 1886, to fix the fair rent for said croft, including the dwelling-house, and arrears payable by him, and that the said application has not yet been disposed of. They have issued the following order, viz.-Wick, 15th September 1890.-The Commissioners having resumed consideration of this application, together with the objections for the respondents and answers thereto for the applicant, and other documents produced, prohibit in hoc statu all proceedings for the sale of the applicant's effects upon his holding by virtue of any decree for rent or arrears of rent, and without prejudice to and under reservation of the whole rights and pleas of parties: Ordain the applicant to make payment on or before the 1st day of November next of the sum of fifteen pounds sterling to account of the rent or arrears of rent sued for."

The defender pleaded, inter alia—“(1) The statements for the pursuers are irrelevant. (2) Lis alibi pendens. (3) In any view, the action ought to be sisted pending the disposal of the defender's application by the Crofters Commissioners.'

The Lord Ordinary (WELLWOOD) having repelled these pleas and allowed a proof, a minute was lodged for the defender withdrawing the defence stated for him, and consenting to decree in favour of the pursuers conform to the conclusions of the summons "without prejudice to the defender's application to the Crofters Commission."

On 20th December the Lord Ordinary, in respect of this minute, decerned against the defender conform to the conclusions of the summons, with expenses, which were subsequently decerned for.

The pursuers thereafter extracted the decree pronounced in their favour, and on 29th May 1891 they charged the defender to make payment of £77, 18s. 7d., being the rent, interest, and expenses found due thereby, under deduction of £15 paid to account by the defender in accordance with the order of the Crofters Commissioners. The charge expired without payment being made, and in July the pursuers assigned the decree obtained by them to their law-agents Messrs Stuart & Stuart, W.S., who, as already stated, presented a petition for Macleod's sequestration.

In answer to the petition for sequestration, Macleod lodged a minute craving the Court to dismiss said petition. He founded on his application to the Crofters Commissioners, and to the order pronounced by them on 15th December 1890, and pleaded, inter alia-“(1) The petition is incompetent pending the respondent's application to the said Commissioners, and is barred by the terms of the order of said Commissioners. (2) The petition is incompetent in respect of its non-compliance with the statutory requirements, in so far as (b) the debt founded on is contingent. (3) The proceedings of the petitioners are unfair, oppressive, and unjust."

On 22nd August the Lord Ordinary on the Bills (KINCAIRNEY) refused the petition.

"Opinion. I think the petition must be refused. The respondent has applied to the Crofter Commissioners to have his rent fixed on the assumption that his possession is a holding in the sense of the Act. It may turn out not to be so, but the Commissioners have provisionally treated it as a holding and have pronounced orders on that footing. I think I must take it in the meantime that it is or at least may be a holding. If so, it is within the reach of possibility that the arrears for which the petitioners hold a decree, or part of them, may be remitted, and therefore the petitioners' decree is not unconditional; it is in the position of a decree subject to review, and is therefore contingent and insufficient to found a sequestration. (Bankruptcy Act 1856, section 14-Forbes v. Whyte, November 29, 1890, 16 R. 182).

"The petitioners suggested that the petition might be sisted until the condition was purified, but I know of no precedent for such a course, and see no advantage in it.

Further, if I have power to refuse a petition for sequestration on the ground of expediency, I think this petition should be refused on that ground, for this reason, that if sequestration were awarded, and if this debt after a lapse of more than forty days were reduced below £50, the respondent might be unable to get the sequestration recalled. He would suffer a wrong without having any apparent remedy. Having in view the observations of the Lord President in Campbell v. Macfarlane, 1862, 24 D. 1097, I think that, sitting in the Bill Chamber, I cannot hold that I have not that power.

"I think the petition should be refused on these two grounds. I do not find it necessary to deal with the respondent's other objections."

The petitioners reclaimed, and arguedA decree of Court was not suspended by an application to the Commissioners, and they had no power to suspend sequestration which was a diligence-Fraser v. Macdonald, December 7, 1886, 14 R. 181. Section 3 of the Crofters Holdings (Scotland) Act 1887 referred to section 1 of the Crofters Holdings Act 1886, and its purpose was limited to preventing a crofter being removed in consequence of a charge upon a decree for rent due upon his holding having expired without payment being made. The debt founded on by the petitioners was not arrears of rent of a "holding." It was constituted by a decree granted in terms of the conclusions of the libel, which proceeded on the averment that the sum sued for was the arrears of rent of an inn let to the respondent separately from his holding as a crofter, and was granted in respect of the respondent having withdrawn his defence that the sum sued for was the arrears of rent of the dwelling-house of his holding. It had now been ascertained that the respondent's application had been refused by the

Stuart v. Macleod

8. 1891

Sub-Commissioners. The Lord Ordinary had no discretion to refuse sequestration where the conditions required by the Bankruptcy Act had been complied with -Bankruptcy Act 1856, sec. 30.

The respondent argued-Until the respondent's application was disposed of finally, it could not be known whether the debt founded on was or was not due to the petitioners. In the meantime the Commissioners had misused the powers given them by sec. 2 of the Act of 1887 by prohibiting a sale of the crofter's effects. The debt was contingent, and the petition should be refused-Forbes v. Whyte, November 29, 1890, 16 R. 182. The Sub-Commissioners' decision did not affect the contingency of the debt, as it was subject to an appeal to the Commissioners. The pro

ceedings taken to make the respondent notour bankrupt were contrary to sec. 3 of the Crofters Act 1887. It would destroy the benefit of a crofter's application to the Commissioners if his estates could be sequestrated for arrears of rent pending their decision. The minute put in by the respondent, in respect of which the decree constituting the debt founded on by the petitioner was pronounced, was lodged "without prejudice to the defender's application to the Crofters Commission," and because the defender had no power to prevent the pursuers getting a decree for the amount of the arrears in accordance with the case of Fraser v. Macdonald. In that case, however, the effect of such a decree was specially reserved, and the amount ultimately to be paid thereunder would depend on the result of the application to the Commissioners. The question of the contingency of the debt founded on by the petitioners was therefore not affected by the circumstances in which the decree constituting it was granted. Further, it was within the discretion of the Lord Ordinary to refuse an application for sequestration if reasonable

cause were

shown why it should not be grantedCampbell v. Macfarlane, June 11, 1862, 24 D. 1097; Gardner v. Woodside, June 24, 1862, 24 D. 1133. This was a case for the exercise of such discretion by the Court. There was no case of diligence, for the landlord was the respondent's sole creditor. There was no danger of dilapidation. The creditor could suffer no loss by the application being refused, while the bankrupt would be greatly prejudiced if it were granted.

At advising-

LORD ADAM-This is a petition at the instance of Messrs Stuart & Stuart, Writers to the Signet, for sequestration of the estates of Donald Macleod. The Lord Ordinary has refused the application, and the question is whether he has been right in so doing.

It is not disputed that the respondent Macleod is subject to the jurisdiction of the Scotch Courts, nor is there any question that he is notour bankrupt under the Debtors Act 1880, nor, again, is it disputed that the petitioners have produced oath

and vouchers of debt to an amount sufficient to warrant the granting of sequestration. Thus all the requisites for obtaining sequestration are present, but it is maintained by the respondent that the petitioning creditor is not qualified, because the debt on which he founds is a contingent debt. If that is so, no doubt under section 14 of the Bankruptcy Act sequestration cannot be awarded.

The first question then is, whether the debt on which the petitioning creditor founds is a contingent debt? That debt is constituted by a decree pronounced by Lord Wellwood for the sum of £77, 18s. 7d., and of that amount the sum of £52, 10s. is said to be contingent as being the arrears of rent of subjects which are a holding in the sense of the Crofters Act 1886, and because the respondent having applied to the Crofter Commissioners to have a fair rent fixed, it cannot be known until the result of that application how much of these arrears are really payable to the petitioners. That contention is supported by reference to section 6 of the Crofters Act, which provides sub-section (1) that "the landlord or the crofter may apply to the Crofters Commission to fix the fair rent to be paid by such crofter to the landlord for the holding and sub-section (5) that in the proceedings on such application the Crofters Commission shall take account of the amount of arrears of rent due or to become due before the application is finally determined, and may take evidence of all the circumstances which have led to such arrears, and shall decide whether in view of such circumstances the whole or what part of such arrears ought to be paid."

66

...

Now, assuming that the respondent is a crofter, and that the rent of which he is in arrear is the rent of a holding in the sense of the Crofters Act, it is difficult not to concur in the Lord Ordinary's finding that the debt in question is a contingent debt, because it cannot be known until the respondent's application to the Crofters Commissioners has been disposed of what amount he will have to pay to the petitioners. That of course is, as I have said, on the assumption that the subjects, the rent of which is in arrear, are a holding in the sense of the Act, and that the respondent is a crofter. This leads us to the definition clause of the Act-section 4-to find out what a crofter and a holding are. A "crofter" is defined to mean "any person who at the passing of this Act is tenant of a holding from year to year, who resides on his holding, the annual rent of which does not exceed £30 in money, and which is situated in a crofting parish, and the successors of such persons in the holding, being his heirs or legatees." A "holding is defined as "any piece of land held by a crofter, consisting of arable or pasture land, or of land partly arable and partly pasture, and which has been occupied and used as arable or pasture land (whether such pasture land is held by the crofter alone or in common with others) immediately preceding the passing of this Act,