Henry Thurburn and Another, - Appellants; Robert Steward and Another, - Respondents
| Jurisdiction | UK Non-devolved |
| Judgment Date | 26 January 1871 |
| Date | 26 January 1871 |
| Court | Privy Council |
English Reports Citation: 17 E.R. 127
ON APPEAL FROM THE SUPREME COURT OF THE CAPE OF GOOD HOPE.
Mews' Dig. tit. Colony; II. Particular Colonies; 5. Cape of Good Hope, etc; III. Appeals to Privy Council; 5. Principles on which Privy Council Acts. S.C. L.R. 3 P.C. 478; 40 L.J. P.C. 5; 19 W.R. 678.
[333] ON APPEAL FROM THE SUPREME COURT OF THE CAPE OF GOOD HOPE. HENRY THURBURN and Another,-Appellants; ROBERT STEWARD and Another,-Respondents * [Jan. 23, 25, and 26, 1871]. The 6th section of the Placaat of the Emperor Charles V., of the 4th October, 1540, postponing the claims of Wives, under Marriage Settlements, until the claims of Creditors of the Husband are satisfied, formed part of the Roman-Dutch Law, which was introduced by the Dutch Colonists on the settlement of the Cape of Good Hope in the year 1650, and is still in force in the Colony, unaffected by the Colonial Ordinance, No. 6, of 1843. P., a Merchant domiciled in England, a member of a Firm in the Cape of Good Hope, executed in England a settlement on his marriage with an English woman, whereby he covenanted to pay the Trustees of the Settlement the sum of 13,000 for his Wife's benefit, and to secure the same by mortgage on his real estate in that Colony. At the time of the Settlement P. was perfectly solvent. The Settlement was not registered in the Colony. P. afterwards went to the Cape, and, by a Bond hypothecated his real estate there to his Wife, to secure the sum of 13,000 in satisfaction of the Settlement. This Bond was registered in the Colony. P. also, while there, remitted a sum of 7000 to the Trustees on account of the sum of 13,000 secured by the Settlement. P.'s Firm at the Cape was some time afterwards adjudicated, in that Colony, Bankrupts, and P. was also made a Bankrupt in respect to his separate estate:-Held, first, that as the 6th section of the Placaat of Charles V. was part of the law in force in the Cape of Good Hope, it postponed the claim of P.'s Wife under the Settlement until his Creditors were paid [7 Moo. P.C. (N.S.) 388]. Second, that although the Settlement was made in England, the domicile of P. and his Wife, yet that the Placaat, being a rule governing the distribution of the assets of the Bankrupt, prevailed in the Colony, as the provisions of the 6th section did not limit it to Marriage Settlements by Dutch Law, so as to exempt Settlements by English Law. The rule being that in a distribution of assets in a concursus of Creditors, the order of distribution is a matter for the lex fori where the distribution takes place [7 Moo. P.C. (N.S.), 383, 384]. Held, further, that under sections 34 and 36 of the Cape Insolvency Ordinance, No. 6, of 1843, the provisions of sect. 6 of the Placaat did not apply so as fo postpone the claim of the Wife of P. to the creditors of the joint estate of the Firm, but only to the separate estate of P. [7 Moo. P.C. (N.S.) 396, 397, 398]. The Court below-in a claim for reconvention. by the Assignees of P. against the Trustees of the Settlement; held that the payment of the 7000 was an undue * Present: Lord Cairns, Sir James William Colvile, Sir Robert Phillimore (Judge of the Admiralty Court), and Sir Joseph Napier, Bart. 127 VII MOORE N.S., 334 THURBURN V. STEWARD [1871] preference in contemplation of Bankruptcy, within the meaning of the 84th sction of the Cape Insolvent Ordinance of 1843. On appeal, such holding reversed [7 Moo. P.C. (N.S.) 395, 396]. As a general rule, the appellate Court will not reverse a decision of the Court below on a mare question of fact; but where there is no conflict of testimony, and the only question of fact is as to the effect of the facts proved in raising further inferences of fact, that rule does not apply [7 Moo. P.C. (N.S.) 389]. The Appellant, Paterson, a native of Scotland, resided in the Cape Colony from the year 1842 to 1859. In the latter year he removed to London, [334] where he acquired English domicile. In the year 1863 the Appellant married Marizza Bowie, his second and present Wife, in England. On the day before such marriage, and in contemplation thereof, a Settlement or Marriage contract was executed, of which the Appellant himself, with two other persons, since deceased, were constituted Trustees. The Appellants were the surviving Trustees of such Settlement. [335] At the time of the Settlement and marriage, the Appellant, Paterson, was a partner in the mercantile firm of Paterson, Kemp, and Co., at Port Elizabeth, in the Cape Colony, the other partner of which was Mr. Vardy, who lived at Port Elizabeth, and managed the business of the firm there. By the aforesaid Settlement the Appellant, Paterson, covenanted to pay his Wife an annuity of 1200, in case of her surviving him, and to pay the Trustees 10,000 for the children of the marriage; and he covenanted to give the Trustees a Mortgage Bond over certain specified property in the Cape Colony, to secure the payment of the annuity and of 5000, on account of the 10,000, but so that he should be entitled to demand a release of such mortgage security on paying to the Trustees 13,000, as a sufficient sum, to meet the obligation for payment of the annuity, and the sum of 5000 on account of the children's provisions. By the same Settlement the foregoing provisions were declared to be in discharge of all legal claims by Marizza Bowie or the children of the marriage, and Marizza Bowie made over to the Appellant, Paterson, all her estate, real and personal, present and future. Marizza Bowie had not any fortune or marriage portion, nor had she afterwards through gift or succession from any friends or relatives. This Deed of Settlement was not registered in the Colony. The Appellant paid a visit to the Cape Colony in the course of the year 1863, and while at Cape Town handed to his Conveyancer a copy of the above Settlement, requesting him to prepare such a Mortgage Bond as was required by it. The Conveyancer prepared a Mortgage Bond or Deed of hypothecation [336] from the Appellant to his Wife (a usual mode of conveyancing in the Colony), and the same was executed and registered at Cape Town on the 20th of August, 1863, which purported to hypothecate the property specified in the Settlement for the sum of 13,000, in accordance with the conditions of such settlement, a copy of which Deed was filed with the Deed in the Office of Registry. In the latter part of the year 1865 the Appellant, Paterson, went to the Colony, and finding that, although his means were much reduced by the failure of many of the Debtors to his firm, he still had a. surplus of assets, he made an arrangement with Standard and London and South African Banks, whe were the principal Creditors of the firm, by which he gave them further security, and they undertook to liquidate both the partnership and his private estates. The Appellant, Paterson's co-trustees of the Settlement, who had adopted the Deed of hypothecation of the 20th of August, 1863, refused to release that mortgage without full payment of the 13,000, whereupon the Appellant remitted from the Colony to his co-trustees in England the sum of 4000 in February, 1866, and three Bonds of the nominal value of 3300, in April, 1866, making in all 7300 which the Trustees of the Settlement received on account of the 13,000 on the trusts of the Settlement. The Appellant, Paterson, informed the Standard and London and South African Banks of these remittances before the arrangement with those Banks hereinbefore referred to was made; but after the making of that arrangement the Manager of the Standard Bank told the Appellant, Paterson, that he had heard [337] there was a law in force in the 128 THURBURN V. STEWARD [1871] VII MOORE N.S., 338 Colony which made the Marriage Settlement void, and that he must get back the 7000. The Appellant, Paterson, returned to England in August, 1866, and the Banks put both his private and the partnership estates under sequestration, the former on the ground that he had left the Colony. The Respondents were the Trustees of the private estate of the Appellant, Paterson, under the sequestration. On the llth of December, 1867, the Appellant, Thurburn, with a co-trustee of the Settlement^ since deceased, proved a debt of 17,000 against the Appellant, Paterson's, private estate, as the balance due to them under the Settlement, the same being secured to the extent of 13,000 by the Deed of hypothecation; but on the 22nd of May, 1868, the Supreme Court at Cape Town, on the application of the Respondents, ordered that the above proof should be expunged, and that the Trustees of the Settlement should have liberty to declare against the Trustees of the insolvent estate, in order to determine the validity and amount of their debt. Accordingly, on the 4th of November, 1868, the Appellants, as Trustees of the Marriage Settlement, filed their declaration in the present suit against the Respondents, as Trustees of the separate insolvent estate of the Appellant, Paterson, and thereby, after stating the Settlement and Deed of hypothecation, submitted to the Court that, although the latter hypothecated the property therein mentioned for a less sum than it should have been hypothecated for, inasmuch as it hypothecated the same for only the estimated value of the annuity of 1200, and not for [338] any part of the sum of 10,000; and although it was informal, in purporting to make the Wife the Mortgagee instead of the Trustees, yet that, in substance and effect, it was an instrument of the same force as if it had been directly executed in favour of the Trustees for securing the sum of 13,000, towards the purposes of the Settlement. The declaration proceeded to state the payment of the 7000 to the Trustees, the sequestration of the respective estates of Paterson, Kemp, and Co., and of the Appellant, Paterson, the proof of debt made by the Appellants, and the Order expunging the same, and the...
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...the Insolvency Act as if it had supplanted the common law. In Thurburn and Another v Steward and Another, 1871 (VII) Moore (N.S.) 333; 17 E.R. 127, the Privy Council held that the 1843 Insolvent Ordinance of the Cape was not a complete Code and that the 6th head of the Placaat of the Empero......