& Co. v. Cannon

14,

appointment as agents for the sale of leather goods was only for the period of one year, and was conditional upon the defenders carrying on the business for that time."

On 28th June 1892 the Lord Ordinary (Low) found that the pursuers' averments were not relevant or sufficient to support their conclusion for damages, dismissed the same, and decerned.

His Lordship delivered the following opinion-"... The pursuers aver that they agreed to act as agents in Scotland for the sale of goods manufactured by the defenders, consisting of leather goods, dips, and glues, at a certain rate of commission and other allowances, for a period of five years from 1st October 1891, unless broken by mutual consent, and with a reconsideration of terms for leather at the end of the first year.

"The alleged breach of the contract is set forth in article four of the condescendence, which is in the following terms,—‘In the month of January of the present year, the defenders intimated to pursuers that they intended to give up their fancy leather trade, and advised the pursuers to become agents for another firm in the same line of business, to whom they offered the pursuers an introduction. The defenders also intimated that in other respects they were prepared to adhere to the said agreement. The pursuers replied declining to depart from the agreement or to give up their rights thereunder, and intimated their willingness to continue to implement the same. In pursuance of the agreement the pursuers ordered goods from the defenders on the 20th January 1892, but the latter declined to execute the order, and thereafter instructed the pursuers to return to the London address of the defenders all stock held by the pursuers as the defenders' agents in Scotland. The defenders' actings amounted to a breach of the agreement above mentioned, and they still refuse to carry out or implement the same.'

"The loss which the pursuers aver they have sustained through the alleged breach of contract is said to have arisen as follows: -The pursuers aver that upon the faith of the agency continuing for many years, and at the defenders' request they took a larger office in Glasgow for the purpose of the defenders' agency than they would otherwise have required, and that they also incurred expenses in travelling and in engaging sub-agents.

In my opinion the pursuers have not set forth a relevant case of breach of contract.

"In the first place, they say that the defenders intimated that they intended to give up the fancy leather, but offered to continue the agreement in regard to other goods. If this constituted a breach of the agreement, it must be because by entering into the agreement the defenders became bound to carry on all the branches of their business to which the agreement referred for the period specified in the agreement. There is no such obligation expressed, and in my judgment it cannot be implied. I do

not think that the defenders bound themselves to carry on their business or any branch of it for five years, or for any other period, simply for the benefit of the pursuers. If the defenders found it expedient to give up any part of their business, it seems to me that so far as their agreement with the pursuers was concerned they were perfectly entitled to do so. There is no allegation here of fraud, or that the defenders gave up the fancy leather trade for the purpose of injuring the pursuers. It is simply said that the defenders intimated that they intended to give up the fancy leather trade, but that in other respects they were willing to adhere to the agreement. In my opinion, that averment does not necessarily imply or even suggest that the defenders did anything which they were not perfectly entitled to do. view which I take seems to me to be consistent with the judgment of the House of Lords in the case Rhodes v. Forwood, 1 App. Cases, 256.

The

"Then the pursuers say that they ordered goods from the defenders on 20th January 1892, but that the latter declined to execute the order. As I read the pursuers' averments, this incident occurred after the defenders had intimated that they intended to give up the fancy leather trade and when the position of matters was as follows:-As I have already pointed out, the defenders while intimating that they were to give up the fancy leather trade, also stated their willingness to go on with the agreement in regard to other goods. The pursuers however would not accept that proposal, but maintained that the defenders were bound to continue the fancy leather trade. If I am right in what I have already said, the pursuers thus took up an untenable position, and one which the defenders were not bound to accept. The pursuers' position seems to have been that they would only do business with the defenders upon the condition that the latter should continue the leather trade. That was a condition to which, in my judgment, the defenders were not bound to assent, and so long as the pursuers insisted on it, I think that the defenders were entitled to refuse to execute their orders.

"But further, I cannot find anything in the agreement binding the defenders to execute every order which the pursuers obtained. The pursuers have produced what appears to be an informal memorandum of agreement and certain letters, by which the contract upon which they found is said to have been constituted. According to the memorandum the pursuers are to get a commission of 10 per cent. upon orders executed in leather goods, and dip and glue are to be invoiced to the pursuers at a fixed price. The pursuers do not say what was the nature of the goods, the order for which the defender refused to execute. If they were leather goods, which they may quite well have been, as nothing is said to the contrary, I think that the defenders must have had some discretion as to whether they should accept the order or not. For example, if the price was so

low that they could not execute the order except at a loss, I do not think that they would be bound to accept it. I am therefore of opinion that in any view the averment is so wanting in specification that it is impossible to say that the pursuers have stated a relevant case.

"The pursuers further aver that the defenders instructed them to return all their stock which was in their hands. The importance and effect of this averment depends upon what precedes it. If the pursuers had averred that without discontinuing any branch of the business the defenders had resolved, in breach of their agreement, to give up employing them as their Scotch agents, the withdrawal of the stock would have had an important bearing upon the matter. But the pursuers' averment is that while the defenders intimated their intention to give up the leather trade, they also intimated that they were willing to continue the agency as regarded the other articles, and they do not say that the defenders were in bad faith in making these intimations. So far I am of opinion, as I have already said, that the defenders did no more than they were entitled to do, and it was the pursuers who put themselves in the wrong by virtually refusing to act as the defenders' agents at all unless they continued the leather trade. In such circumstances I think that the pursuers were entitled to ask back their goods. further, the mere fact that the defenders asked that certain goods should be sent back is not necessarily inconsistent with the agreement. Suppose that the defenders-and this is indeed the case which they aver-had sent a quantity of goods to the pursuers in the expectation that they would meet with a ready sale and subsequently found that the goods were not being sold, but were lying undisposed of and depreciating in the pursuers' warehouse, I see no reason why the defenders should not have asked that the goods should be sent back to London in order that they might dispose of them there. Such a state of matters is perfectly consistent with the pursuers' averments, which I therefore think do not disclose any relevant ground for a claim of damage.

But

"There was some argument as to whether the pursuers might not have a claim for repayment of money disbursed by them upon the faith of the agency being of a continuing nature upon the principle recognised in Dobie v. Lauder's Trustees, Ï1 Macph. 749. It is sufficient to say in regard to this argument that no such question is raised in the pleadings (the only case presented being one of damages for breach of contract), and the pursuers did not propose to amend the record.

"I shall accordingly find that the pursuers' averments are not relevant to support the claim of damages."

The pursuers reclaimed, and at the hearing intimated that they were prepared to add a plea to the effect that they were entitled to repayment of money disbursed by them on the faith of the agency being a continuing one.

At advising

LORD PRESIDENT-I think that the Lord Ordinary is right. It appears to me that the case of Rhodes v. Forwood applies in so far as the action is laid on breach of contract. I think that the pursuers entered into the agreement on the understanding that they were to get all the defenders' business in Scotland in the branches specified, but that it was not a stipulation of the contract that the defenders should themselves continue in any particular branch.

The pursuers also pointed to article 5 of their condescendence as raising a separate or alternative claim limited to a smaller sum of money. They have not supported this claim by a plea-in-law, but they intimated that they were prepared to add such a plea. I am, however, of opinion the averments on record are not such as to raise any such question. I think the case is one on breach of contract, or nothing at all. The pursuers say in condescendence 5 that 'when the said agreement was entered into, the pursuers, at the defenders' request, arranged to change their office in Glasgow, and to remove to a larger one with greater storage and show-room accommodation in order to suit the requirements of the defenders' business." Now, I think that the

66

fair reading of that is, that they took the larger office because without making this change they would not have got the contract. That then takes us back to the question what was the contract? And it was a contract, as I have said, by which the defenders did not pledge themselves to continue in any particular branch of their business.

LORD ADAM-I am of the same opinion. To have any foundation for the alleged breach of contract the pursuers must make out that it was either an express or an implied condition of the contract that Cannon & Company, the defenders, should continue to carry on their leather business for at least a year. Such a condition is certainly not expressed, and I cannot find that it is implied. All that the defenders agreed to do was to employ the pursuers if they continued in the business. I think that this is just the case of Rhodes.

The pursuers also maintain they incurred certain expenditure on the faith of the business being a continuing one, and that this expenditure and the profit which they expected to make have been lost through the discontinuance of the business. They aver "The defenders were desirous"-[His Lordship then read the remainder of Cond. 2]. I think that is nothing more than a statement of what the pursuers did. They do not say that the defenders specially authorised these alleged acts of expenditure; all they say is, that they had "the full knowledge and approval of the defenders." Then in condescendence 5 they make the averment which your Lordship has read. I think that simply means that they removed to a larger office for their own benefit, and in the hope and expectation of making a profit, but at the same time taking the risk of the contract of the

July 14, 1892.

SECOND DIVISION.

[Lord Kincairney, Ordinary. FORBES' TRUSTEES v. DAVIDSON. Servitude - Thirlage - Agreement to Pay Fixed Sum in Lieu of Insucken Multures, Discontinuance of-Personal or Real-Title to Sue,

By deed of submission dated in 1814 between certain persons "proprietors connected with the sucken and thirlage of the meal mill of N" on the one part, and the proprietors of the said mill on the other, proceeding on the narrative that it was expedient that the servitude of thirlage should be compensated or commuted by a fixed annual payment in lieu and satisfaction of the said right of thirlage, and of all services, prestations, and restrictions incident thereto; and in order to prevent disputes in the exaction and payment of the multures and sequels at the mill; and that the intake and mill run of the mill had been attended with inconvenience and loss to the proprietors of the mill and to the proprietors and tenants astricted, and that the millowners were "willing to take the whole responsibility of keeping up and supporting the intake and aqueduct to the meal mill in all time coming, both for their own improvement and the more immediate service and accommodation of the sucken," on payment of an annual sum by each of the parties submitters as compensation in lieu of multures, sequels, and mill services-the parties therefore submitted to the arbiter all differences and disputes presently subsisting between them with regard to the said annual compensation, declaring that this compensation should in no ways prejudice the proprietors of the mill of their claim to outsucken multures.

By decree-arbitral the arbiter fixed the sums payable by the respective heritors and suckeners, as in full of all

demands that the proprietors of the mill could have against the said heritors and suckeners for multures, sequels, and services, and ordained the proprietors of the mill to accept the same yearly and termly in all time coming.

In 1878 the proprietors of the mill sold it, the disposition conveying, inter alia, the "haill multures, sucken, sequels, and knaveships of the said mill, and all haill parts, privileges, and pertinents thereof."

Shortly after buying the mill, the purchasers resolved to discontinue it, and in great part demolished the building. One of the parties found liable in an annual payment under the decreearbitral thereupon declined to make any further payment, and the purchaser of the mill brought an action to enforce payment, admitting that he had no intention of rebuilding the mill.

Held (rev. judgment of Lord Kincairney-dub. Lord Rutherfurd Clark) that on a sound construction of the submission and decree-arbitral, it was a condition of exacting the payments found due by the arbiter that the mill should be in a working condition, and therefore as it was admitted that there was no intention of rebuilding the mill, that the defender fell to be assoilzied. By deed of submission dated June 1814 between certain proprietors "connected with the sucken and thirlage of the meal mill of Nairn,” including Sir David Davidson of Cantray upon the one part, and Arthur Cant and James Houston, proprietors of the said mill, upon the other part, the parties, "Considering that the servitude of thirlage and right of mill services incident thereto are very unfavourable to the general improvement of the country, by checking the industry of the occupiers of the grounds, and by occasioning troublesome and expensive litigation, and that it is highly expedient that such servitude should be compensated or commuted by a fixed annual payment in lieu and satisfaction of the said right of thirlage, and of all services, prestations, and restrictions thereto incident or pertaining; and in order to prevent any disputes which may arise in the exaction and payment of the multures and sequels at the meal mill of Nairn, and considering that the intake and mill run of the said mill has at all times been attended with considerable trouble, loss, and inconvenience both to the proprietors of the mill and to the proprietors and tenants astricted to the thirlage thereof, and that the said Arthur Cant and James Houston are willing to take the whole responsibility of keeping up and supporting the intake and aqueduct to the meal mill in all time coming, both for their own improvement and the more immediate service and accommodation of the sucken, upon having ascertained and being paid a certain annual sum by each of the parties submitters as a compensation in lieu of multures, sequels, and mill services; and the said parties submitters having entire trust and confidence in the know

ledge, skill, and ability of Sir George Abercromby of Birkenbog, Baronet, they hereby submit and refer to him as sole arbiter, chosen by and between the said parties, all differences and disputes presently subsisting between them with regard to the annual compensation which the said parties proprietors connected with the thirlage of Nairn ought and should pay to the said Messrs Arthur Cant and James Houston as proprietors of the said meal mill of Nairn, for their respective multures, sequels, and mill services now pertaining thereto, and the term of payment of such annual compensation; But declaring that this compensation shall in no ways prejudice the said Arthur Cant and James Houston of their claim of out-sucken dues for such corn as may be ground at their mill either by the parties' submitters, their tenants, or others: Declaring also that the present submission shall not affect the proprietors for such lands as are presently under lease until the expiry of these leases, but that the tenants of these leases shall continue to pay and perform the present multures and services until the expiry of their leases, or, in their option, accede to the compensation to be granted by this submission and decreet-arbitral to follow hereon; But declaring also that this option shall not be in the power of these tenants unless they shall accede thereto previous to a decree being pronounced in this submission, with power to the said arbiter to receive the claims of parties, take all manner of probation thereanent by writs, oaths of parties or witnesses, as he may think proper and fit for determining the matters hereby submitted: And whatever the said arbiter shall determine in the premises... the parties submitters hereby bind and oblige themselves, their heirs and successors, to implement, fulfil, and perform."

On 8th December the arbiter issued a decree-arbitral, of which the following were the findings-"Primo, I find that the annual compensation to be paid by the heritors and suckeners to the mill of Nairn who are parties to the aforesaid submission in lieu and satisfaction of the multures, sequels, and services they presently pay and perform, shall in all time coming be the sum of £50, Os. 14d. sterling yearly, and that the said sum shall be exigible from the different heritors and suckeners in proportion following, viz., inter alios, Sir David Davidson of Cantray, the sum of £13, 0s. 6d. sterling,... and which proportions shall be in full of all demands that the proprietors of the mill can have against the said heritors and suckeners for multures, and sequels, and services; and I ordain the proprietors of the mill to accept the same accordingly, and that the commencement of the payment of said proportional sums of money shall be at the time of Candlemas 1816 for crop and year 1815, and so forth yearly and termly in all time coming: Secundo, I decern that the proprietors of such lands as are under lease shall not be liable in payment of the aforesaid proportional sum in so far as they may affect the

lands under lease until the expiry of these leases, but that the tenants of these leases shall continue to pay and perform the present multures and services until the expiration of the said leases: Tertio, I find and decern that this compensation shall in no ways prejudge or render ineffectual the claims of the said proprietors of the mill for outsucken dues on such corn as may be ground at their mill either by the parties submitters, tenants, or others, and that the suckeners who are not parties to this submission shall be liable in the same multures and services as were formerly paid and performed by them: Declaring always that nothing herein contained shall invalidate or infringe any right competent to the proprietors of the mill when repairing the mill dam, and the lead or aqueduct conducting the water to the mill, to take stones, turf, or other materials from the lands of any of the neighbouring heritors, or to deepen and clear the same, conform to use and wont."

By agreement dated in 1866 between Arthur Cant and Matthew Cant, then heritable proprietors of the said mill, of the first part, and Hugh Davidson, Esq. of Cantray, and others, proprietors of lands in the sucken or thirlage of the said mill, of the second part, it was, inter alia, agreed that one-fourth, or 25 per cent. of the converted multures, &c., payable in terms of the foresaid decreet-arbitral should, from and after the term of Candlemas 1865, be struck off and discharged for the future. Under the said agreement the suckeners had power to redeem the converted multures, &c., and this power was exercised by them all, with the exception of Davidson of Cantray and three others. The amount of the converted reduced multures, &c., payable annually by Davidson at the term of Candlemas in respect of lands held by him was £4, 1s. 44d. The suckeners who did not redeem bound themselves and their respective heirs and successors by the agreement to pay to the proprietors of the mill, and their heirs and successors in the mill, the conversions at the reduced rate yearly in all time coming during the notredemption thereof, with interest from the respective terms of payment at 5 per cent. per annum, and they further bound themselves to take "any steps they may be advised to take for rendering the arrangement binding in the future on those who do not now redeem, such as a verdict under the Multures Conversion Act."

In 1878 Arthur Forbes of Culloden purchased the Nairn Mills, conform to disposition granted by Arthur Cant and Matthew Cant in his favour dated 10th and 13th May and recorded in the Division of the General Register of Sasines applicable to the county of Nairn the 21st day of May, and in the Particular Register of Sasines, Reversions, &c., kept for the burgh of Nairn the 22nd day of June, all in the year 1878. By said disposition there were conveyed, inter alia, "All and haill the two halves of the Mill of Nairn. . . . together with the mill-house and houses at Milltown following the said two halves of

' Trs. v. Davidson

14, 1892

the said mill, haill multures, sucken, sequels, and knaveships of the said mill, and all haill parts, privileges, and pertinents thereof." The said disposition also conveyed the granters' "whole right, title, and interest, present and future, in the whole lands, mills, and other subjects hereby disponed, with their pertinents." The disposition also contained the usual clause of assignation of writs, the inventory annexed making special mention of the above submission and decree-arbitral.

In June 1891 the trustees under the trust disposition and settlement of Mr Forbes (who had died in 1879) brought an action against Hugh Davidson of Cantray, son of Hugh Davidson, the party to the agreement of 1866, and grandson of Sir David Davidson, the party of the submission of 1814, concluding for declarator "that the defender, as a proprietor of lands in the sucken or thirlage of the mill or meal mill of Nairn, and as heir-at-law of or otherwise representing the deceased Sir David Davidson, sometime of Cantray, and the deceased Hugh Davidson, Esquire, sometime of Cantray, and the defender's heirs and successors in the said lands, are bound to make payment to the pursuers, as heritable proprietors of the said mill, and their heirs and successors in the said mill, of the sum of £4, 1s. 4 d., being the reduced rate of the converted multures, sequels, and services pertaining to the said mill from the said lands, under and in terms of" the submission of 1814, .. "and under and in terms of" the agreement of 1866, "and that yearly and in all time coming during the not-redemption thereof, at the term of Candlemas in each year, with interest thereon at the rate of 5 per centum per annum from the respective terms of payment till paid: And further, our said Lords ought and should decern and ordain the defender to make payment to the pursuers of the sum of £55, 18s. 8d. sterling, being the amount of the arrears of said converted multures due by the deceased Hugh Davidson, Esquire, and by the defender, as at Candlemas 1891, with interest thereon at the rate of 5 per centum per annum from the term of Candlemas, 2nd February 1891, until payment thereof."

The pursuers set forth the deeds and proceedings above narrated. They further stated that the defender's father and grandfather had regularly paid the sums due by them under the deeree-arbitral and the agreement down to and inclusive of crop 1879, but that since then they had declined to pay anything.

The pursuers pleaded (1) The defender, as heir-at-law of or otherwise representing on a passive title the said Sir David Davidson of Cantray and Hugh Davidson of Cantray, being liable to the pursuers in payment of the annual sum set forth in the summons, under and in terms of the decree-arbitral and agreement libelled on, and he having delayed or refused to make payment, the pursuers are entitled to decree as concluded for, with interest and expenses. (2) The

pursuers are entitled to decree as concluded for, in respect that the said writs constitute a valid servitude affecting the defender's lands; and separatim, in respect that such a servitude has been constituted by prescriptive possession.”

The defender stated that he possessed the estate as heir of entail, and represented his grandfather and father in that capacity only; and further averred that the mill had been demolished in 1879, and that by an agreement with other parties (the nature of which sufficiently appears from the Lord Ordinary's opinion) it was ultra vires of the defenders to restore it.

The defender pleaded-"(1) No title to sue. (4) The right to multures has been extinguished by the demolition of the subject, and the claim, so far as founded on the submission, is not enforceable, seeing that the pursuers are unable to fulfil their part of the contract. (5) The agreement for payment of said sums did not transmit against the defender, he being an heir of entail, and he is not bound to pay said sums."

A proof was allowed. The evidence showed that the defender represented his grandfather Sir David Davidson only as heir of entail of Cantray, but that he was residuary legatee of his father, and had as such received considerable estate. It was also established that the Mill of Nairn had been demolished, and that there was no intention or probability of restoring it.

On 26th March 1892 the Lord Ordinary (KINCAIRNEY) repelled the defender's pleasin-law, sustained the title of the pursuers, and decerned in terms of the conclusions of the summons.

"Opinion. This action has been brought by the trustees of the late Mr Forbes of Culloden, as proprietors of the Mill of Nairn, against Mr Davidson of Cantray, for declarator of their right as owners of the mill to certain sums as commuted multures, and to recover payment of the arrears of commuted multure, said to amount to £55, 18s. 8d.

"The declaratory conclusion is directed against the defender as proprietor of lands within the thirlage of the mill, and as representing Sir David Davidson and also Hugh Davidson, successively of Cantray; and the conclusion is that the defender as such proprietor and representative, and his heirs and successors in the lands of Cantray, are bound to make payment to the pursuers as heritable proprietors of the mill, and their heirs and successors in the mill, of £4, 1s. 44d. annually, as the reduced rate of the converted multures, sequels, and services due by the defender under a decreet-arbitral dated 8th December 1814 and an agreement executed in 1866.

"I understand that the right of burden of thirlage does not appear from the titles of either party, but is said to have been constituted or proved by the decreetarbitral and the submission on which the decreet is based.

"The deed of submission was between various persons, including Sir David