Bertie Walter Hull V. James William Thomas Campbell
| Jurisdiction | Scotland |
| Judge | Lord Turnbull |
| Judgment Date | 2011 |
| Neutral Citation | [2011] CSOH 24 |
| Published date | 02 February 2011 |
| Date | 02 February 2011 |
| Court | Court of Session |
| OUTER HOUSE, COURT OF SESSION [2011] CSOH 24 | |
| OPINION OF LORD TURNBULL in the cause BERTIE WALTER HULL Pursuer; against JAMES WILLIAM THOMAS CAMPBELL Defender: ________________ |
Counsel for Pursuer: Bartos, Campbell Smith WS
Counsel for Defender: Devlin, Brodies LLP
Counsel for the Lord Advocate as Minuter: Miss Poole
2 February 2011
Introduction
[1] This is an action which arose out of a remarkable set of facts, concerns a remedy unheard of in modern times and concluded in quite surprising circumstances, which, with hindsight, perhaps demonstrated an attitude in keeping with the whole history of the dispute between the parties to this case.
Background
[2] In June of 1992 the pursuer obtained decree against the defender in the Sheriff Court at Ayr in respect of a debt of £9,600. By 1998 no payment of any of this debt had been made and the pursuer raised an action of adjudication in the Court of Session. By that time the accumulated sum, comprising principal debt, interest and expenses had risen to £18,483.80. That action concluded on 3 July 1998 when this Court pronounced a decree by which the defender's heritable property was adjudged to the pursuer. The ten year reversionary period known as "the legal" then duly expired without a single penny being paid by the defender in reduction of his debt and in August of 2008 an action for declarator of expiry of the legal, and that the defender's property as adjudged should belong to the pursuer was raised. Defences were lodged to that action, the Lord Advocate entered the proceedings by way of Minute in terms of Rule of Court 82.4 and the action eventually called for proof before me in October of 2010. By this stage the agreed sum due by the defender, in terms of the original decree and interest, had grown to £52,272.87. The defender had still refused to pay any of his debt and had made no offer to make restitution in any form. The defender's property consisted of his one half pro indiviso share of a house at 51 Hillfoot Road, Ayr, where he lived with his wife. It was agreed that the market value of that house was approximately £130,000 and that it was now free of mortgage and standard security. Although not crucial to the arguments before me, the original debt due by the defender appeared to have become obscured in the mists of time, as no one who appeared before me was aware of its nature or of the circumstances in which it arose.
The Nature of The Action
[3] The present action is the concluding stage of a now very unusual process of diligence known as adjudication. Following on the grant of a decree for payment a creditor may raise an action for adjudication, which is an action directed at the debtor's specified heritable property. A decree of adjudication operates as a judicial heritable security over the subjects adjudged and prevents the owner from disposing of them in any fashion. The debtor may redeem the security at any time but if after ten years the debt is still unpaid the creditor can convert his security into a title to the property by an action of "expiry of the legal". A decree of declarator of expiry of the legal is understood to have the effect of conveying the subjects adjudged to the creditor. It is granted under the authority of the Diligence Act of 1672, as amended by the Lands Transference (Scotland) Act 1847, the Titles to Land Consolidation (Scotland) Act 1868 and the Statute Law Revision (Scotland) Act 1906. In setting out the operation of the diligence the Act of 1672 refers back to the Diligence Act of 1661 and the history of the process can be traced back through various other legislative pronouncements to an Act of 1469. The diligence of adjudication will be abolished when sections 79 and 81 of the Bankruptcy and Diligence etc. (Scotland) Act 2007 are brought into force.
Pursuer's Submissions
[4] Mr Bartos for the pursuer took me through an interesting historical examination of the development of the diligence of adjudication, with the purpose of demonstrating the effect of its use. He explained how the diligence could be traced back at least as far as an Act of 1469 which provided a method whereby a creditor could recover a debt owed by a debtor whose only asset was land. That act permitted a sheriff to sell the debtor's land to the value of the debt due and remit payment to the creditor. If no purchaser was found the sheriff, with the assistance of thirteen members of the shire, was entitled to appraise the debtor's land and to assign that land, up to the value of the debt, to the creditor. In either case though the debtor retained a power of redemption which entitled him to regain title to the land by repaying the debt due within a period of seven years. Counsel took me to the Diligence Acts of 1621 and 1661 in order to demonstrate how this process of apprising (as it was termed, or sometimes comprising) came to be further regulated and formulated, with two aspects of the 1661 Act being of particular importance in his analysis. The first matter to note was that the legal period during which the debtor could redeem his right to land apprised was extended to ten years. The second was the effect of failure to redeem during this period. According to this provision, in the event of failure to redeem during this period the consequence was that the whole of the debtor's lands (as apprised) would pertain to the creditor irredeemably.
[5] Counsel went on to explain how the diligence of apprising was replaced by adjudication by the Diligence Act of 1672. That Act introduced two different forms of adjudication. The first, which came to be known as special adjudication, permitted the Court to adjudge to the creditor such part of the debtor's land as would be equal to the sum due, with interest, along with a fifth part more, which provision was included to compensate the creditor for the inconvenience of having to take land instead of money. Such land as adjudged would then become the irredeemable property of the creditor unless the debt was redeemed within a period of five years. In order to facilitate the exercise by the creditor of his right to use of the land the Act intended that the debtor should deliver up his title deeds to the adjudger. However the Act also provided an alternative, known as general adjudication, in circumstances where the debtor declined to deliver his deeds. It in effect provided the debtor with a choice. In the event of the debtor declining to deliver up his title deeds the creditor was entitled to adjudge all land and heritage belonging to the debtor under a reversion of ten years and under the same terms and conditions as under the Act of 1661, in other words as he would have been using the diligence of apprising.
[6] The effect of the reference back to the former process of apprising in the creation of general adjudication, according to counsel's submission, was that adjudication followed by expiry of the legal period without redemption of the debt would entitle the creditor to a decree of declarator of expiry of the legal. The effect of this would be to give the creditor irredeemable right to all of the debtor's property as adjudged, regardless of any difference between the value of the land adjudged compared with the extent of the debt accrued. This, on counsel's analysis, was the intention of the Act, which deliberately introduced a penalty on a debtor who chose not to deliver up the title deeds to the lands under special adjudication. That penalty being that he lost all of his property, if the longer reversionary period should expire without repayment of the debt. In support of his interpretation of the statutory provisions Mr Bartos referred me to the cases of Livingston v Goodlet 1704 Morrison 73, Campbell v Scotland 1794 Morrison 321 and Ormiston v Hill a decision of the First Division of the Court of Session (1809 Fac. Coll. 155)
[7] Having set out this position Mr Bartos then addressed the question of whether or not a decree of declarator as sought would be incompatible with the defender's rights as provided for by Article 1 of Protocol 1 to the European Convention on Human Rights, which is in the following terms:
"Every natural person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law.
The preceding provisions shall not, however, in any way impair the right of a state to enforce such laws as it deems necessary to control the use of property in accordance with the general interest or to secure the payment of taxes or other contributions or penalties."
[8] Although he acknowledged that the defender's rights in terms of the Protocol were engaged by the use of this diligence, the first submission advanced by Mr Bartos was, that on the facts of the present case, the defender's rights would not be infringed by a decree being granted in the terms sought. He argued that the order which he sought would be an order provided for by law, would be an order which was granted in order to pursue a legitimate aim, namely the recovery of a debt admittedly due, and would be an order which did not constitute a disproportionate and excessive burden on the defender. The first two propositions were not in contention and in order to support the third counsel relied on the amount of time during which the defender had enjoyed the use of his property and his apparent failure to take any steps to reduce the debt during that period. He also relied upon the argument that further cost would likely be incurred by the pursuer in converting his right under an order pronounced by the court into money. It was submitted that he would require to raise an action of division and sale, since the defender's wife owned the remaining half share in the property concerned. If this action was defended the costs of litigation might be...
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Appeal To The Court Of Session Under Section 21 Of The Legal Profession And Legal Aid (scotland) Act 2007 By David Bartos, Advocate Against A Decision Of The Scottish Legal Complaints Commission Dated 24 January 2014
...by Mr Hull against a Mr Campbell. Mr Bartos was counsel for Mr Hull. The decision in the case and Lord Turnbull’s opinion can be found at 2011 SLT 881. In brief, the circumstances were as follows. In 1992 Mr Hull obtained decree against Mr Campbell in respect of a debt of £9,600. In 1998, n......
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Scots Law News
...of the new towels incident at paras 39-41). But strangest of all the cases that we have read in the early part of 2011 is Hull v Campbell [2011] CSOH 24, which concerned a debt owed by C to H. When H first obtained decree against C in 1992, the amount of the debt was £9,600. By 1998 C had m......