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Walker (Paterson’s Trustee) v Coyle and Others: SCS 13 Nov 1891

Court of Session Inner House First Division – By agreements purporting to be ‘minutes of lease, entered into in 1879 and 1880, the trustees of J. P. ‘let’ to J. S. P. certain premises, and the pawnbroking stock therein, J. S. P. being bound to pay a rent of a fixed amount for the premises, and 5 per cent. on the value of the stock handed over to him. It was provided that J. S. P. should keep books showing his intromissions with the business, and that in the event of the stock falling below the value at which it had been handed over to him, the trustees should have a right to enter into possession of the premises and stock, and that J. S. P. should be bound to cede possession thereof on receiving fourteen days’ notice. On 24th April 1888 J. S. P. executed deeds of renunciation of the lease in favour of the trustees, who at once entered into possession of the premises and stock of pledges therein. Four days afterwards J. S. P. was sequestrated.
Held that under the agreements the trustees parted with the only right they had in the pledges, and only acquired the personal obligation of the bankrupt in a certain event to deliver over to them the pledges then in his possession; and therefore that the deeds of renunciation were ineffectual as granted within sixty days of bankruptcy in satisfaction of a prior debt within the meaning of the Act 1696, c. 5.
References: [1891] SLR 29 – 87
Links: Bailii
Jurisdiction: Scotland

Last Update: 29 July 2020; Ref: scu.613833