Greenock Harbour Trustees v Glasgow and South-Western Rly Company
| Jurisdiction | England & Wales |
| Judgment Date | 28 June 1909 |
| Date | 28 June 1909 |
| Docket Number | No. 11. |
| Court | House of Lords |
Ld. Chancellor (Loreburn), Lord Ashbourne, Lord James of Hereford, Lord Gorell, Lord Shaw of Dunfermline.
SaleSale of heritagePriceInterestRate of interest.
In 1881 Greenock Harbour Trustees entered into an agreement with the Glasgow and South-Western Railway Company whereby the parties respectively agreed to transfer, the one to the other, certain lands at prices to be ascertained. At Whitsunday 1885 the parties respectively obtained possession of the lands to be transferred to them, but differences as to the construction of the agreement and as to the adjustment of accounts delayed execution of conveyances. In 1906 the Harbour Trustees brought an action against the Railway Company for implement and for payment of the balances due to them with interest.
The Railway Company contended that no interest was payable.
In the Court of Session the First Division held that each party was liable to the other for interest from Whitsunday 1885, and that the rate of interest should be 31/2 per cent.
In an appeal by the Railway Company the House (dub. the Lord Chancellor) affirmed the judgment.
(In the Court of Session, June 19, 1908Court of Session reports in the present vol., infra, P. 1438.)
The defenders, the Glasgow and South-Western Railway Company, appealed.
On the question of interest.
Lord Chancellor. Then there is a difference in regard to interest. I confess that I have very great difficulty in acceding to the view that interest should be allowed on the balance of price that may be found payable by one of these parties to the other. I do not believe that the rule laid down in Erskine was ever intended to be applied to such a case. On a sale of heritable property, where the buyer has been put in possession but the price remains unpaid, it is only reasonable to suppose that he takes possession with a knowledge that he cannot receive the fruits without paying an equivalent, and that the seller cannot be expected to yield the fruits without receiving an equivalent. That is a good foundation for implying a contract to pay interest on the purchase money. But in this case the parties mutually exchanged possession of different lands in or before 1885 under an agreement dated in 1881. The conveyances have never been adjusted, the prices never settled, and each party has apparently been paying feu-duties applicable to the subjects which they were under obligation to convey to...
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