Meux v Smith
| Jurisdiction | England & Wales |
| Judgment Date | 01 January 1840 |
| Date | 01 January 1840 |
| Court | High Court of Chancery |
English Reports Citation: 59 E.R. 931
HIGH COURT OF CHANCERY
S. C. 1 M. D. & D. 396; 2 M. D. 789; 10 L. J. Ch. 225; 12 L. J. Ch. 209; 7 Jur. 821. See In re New Land Development Association and Gray [1892], 2 Ch. 147. Followed, Bird v. Philpott [1900], 1 Ch. 822.
Lien. Bankrupt. Vendor and Purchaser. Equitable Mortgage.
[410] meux v. smith. Dec. 16, 1840; March 17, 24, 26, 1841; Jan. 17, 1843. [S. C. 1 M. D. & D. 396; 2 M. D. & D. 789; 10 L. J. Ch. 225; 12 L. J. Ch. 209j 7 Jur. 821. See In re New Land Development Association and Gray [1892], 2 Ch. 147. Followed, Bird v. Philpott [1900], 1 Ch. 822.] Lien. Bankrupt. Vendor and Purchaser. Equitable Mortgage. O., a publican, agreed to sell his public-house (which M. & Co. supplied with beer) to A. A. being unable to pay the whole purchase-money, M. & Co., at his request, (1) Ex relatione. 932 MEUX V. SMITH H SIM. 411. agreed to pay to G. £1000, part of it. At a meeting of the parties for completing the purchase, M. & Co. paid the £1000 to G. G. then executed the conveyance of the house, and, immediately afterwards, delivered it to M. & Co.; and A. signed a memorandum expressing that he had deposited the deed with M. & Co., for securing, by way of equitable mortgage, the payment to them of the £1000. Shortly afterwards, M. & Co. discovered that A. was an uncertificated bankrupt. Held, nevertheless, that they had, as against A.'s assignees, a lien on the deed for the £1000. The Plaintiffs carried on the business of brewers, in co-partnership together, in Tottenham Court Road, Middlesex, under the firm of Sir Henry Meux & Co. In September 1838 one Gurney was possessed of a public-house called The Dolphin, situate in Whitechapel Koad, Middlesex, for a term of 63 years, commencing from Midsummer 1838, in which he had for some time carried on the business of a publican ; and, on the 13th of that month, he was indebted to the Plaintiffs, in the sum of £1000 and upwards, for beer sold and delivered by the Plaintiffs to him. On the same day he was also indebted to an amount exceeding £1000 to Seager, Evans & Co., who were distillers at Millbank, Westminster. Upon the sale of a public-house by the occupying publican, it is the practice for the vendor to pay the debt due to the brewers who serve the house out of the purchase-money: and, as it often happens that the purchaser has not the means of paying the whole of his purchase-money, an application is usually made, either by him or by the vendor for him, to the brewers to advance the amount required to make up the purchase-money upon the security of the premises agreed to be [4113 purchased, and to pay the same to the vendor; and, if the brewers comply with the request, they, at the time fixed for the completion of the purchase, give immediately to the vendor a cheque drawn upon themselves at their place of business for the amount, and, after the completion of the purchase, the cheque is presented by the vendor at the house of business of the brewers; and the vendor receives payment of the cheque by having the amount of it written off the amount of the debt due from him to the brewers; and, upon the delivery of the cheque to the vendor, the vendor delivers immediately to the brewers the title-deeds, including the conveyance of the public-house; and the deeds are held by the brewers until the repayment of the sum advanced by them, with legal interest: and it is also usual for the brewers to take from the purchaser a memorandum signed by the purchaser, whereby he agrees that the deeds shall be deposited with the brewers as a security, not only for the sum paid by them in part of the purchase-money and the interest thereof, but also for all other sums which may become due to them, from the purchaser, in respect of his dealings and transactions with them in the course of his business. On some occasions the sum necessary to make up the deficiency of the purchase-money is advanced, in shares previously agreed on, by the brewers and by the distillers who have served or are intended to serve the house; and the brewers and the distillers agree that their respective debts shall not have priority one over the other, and, in such case, the deeds and memorandum are delivered to and remain with either the brewers or the distillers, but on behalf of both; and the debts, when paid, are paid pari passu. [412] Shortly before the 13th of September 1838 Gurney contracted with Leonard Albin to sell to him the public-house called The Dolphin, and, for that purpose, to grant a lease of it to him for the whole of the term of 63 years, wanting 10 days, at the yearly rent of £102, 10s., in consideration of £2450 : but Albin not being able to pay more than £450 of the purchase-money, he and Gurney went together to the Plaintiffs' brewery, and Gurney then informed the Plaintiffs that he was about to sell the public-house to Albin, and that Albin was unable to advance the whole of the purchase-money ; and Albin thereupon requested the Plaintiffs to pay to Gurney th& sum of £1000, part of the purchase-money, and made a similar request to Seager, Evans & Co.; and the two firms agreed to comply with the requests made to them respectively. Gurney also agreed to sell to Albin all his furniture, stock-in-trade and fixtures in the public-house at a fair valuation ; and the same were accordingly valued at £500. On the 13th of September 1838, which was the day fixed for the completion of 11 SIM. 413. MEUX V. SMITH 933 the purchase, Charlea Callow, the agent of the Plaintiff's, met Gurney and Albin and the agent of Seager, Evans & Co., at the public-house, for the purpose of completing the purchase; and Callow, in payment of the £1000 which the Plaintiffs had consented to pay as before mentioned, then gave to Gurney a cheque for that sum, drawn by him upon the Plaintiffs and made payable to Gurney. On the following day Gurney presented the cheque at the Plaintiffs' brewery for payment; and the Plaintiffs wrote the amount of it off the debt due from him to them. Seager, Evans & Co. [413] paid, in like manner, to Gurney the £1000 which they had consented to pay; and Albin paid the rest of the purchase-money, and also the sum at which the furniture, stock-in-trade and fixtures had been valued. Gurney, on the cheques being delivered and the payments being made to him, executed an indenture, dated the same 13th of September, whereby he demised the public-house to Albin for the term agreed upon; and, at the same time, he delivered to Albin possession of the furniture, &c. Immediately upon the execution of the lease, and in pursuance of the before-mentioned arrangement, Gurney delivered the lease to the clerk of the Plaintiffs' solicitors as the agent and on behalf of the Plaintiffs, and the same was retained by the solicitors, for a short time, for the purpose of being registered in Middlesex, and was then deposited in the strong-room at the Plaintiffs' brewery. The bill alleged that, under the circumstances aforesaid, the Plaintiffs became entitled to a lien upon the public-house for the £1000 paid by them, and the interest thereof; and that the lease was delivered to and was held by them, as well on behalf of themselves and in respect of their lien as on behalf of Seager, Evans & Co., and in respect of their lien upon the premises for the £1000 paid by them, and the interest thereof. Albin being desirous that the Plaintiffs and Seager, Evans & Co. should supply him with goods for the purposes of his business of a licensed victualler and publican, the two firms agreed to do so upon the usual terms; and they requested Albin to sign and give to the Plaintiffs, on behalf of themselves and Seager, Evans & Co., a memorandum of the deposit of the lease, which was to operate by way of further security for the two [414] sums of £1000, and also for any debts which might accrue due from Albiu, to the two firms respectively, in consequence of their dealing with him in his trade. Accordingly, Albin signed and gave to the Plaintiffs, on behalf of themselves and Seager, Evans & Co., a memorandum, dated the 13th day of September 1838, in the words following: "Memorandum-/ luwe this day deposited with Sir Henry Meux & Co. the lease of The Dolphin public-house, Whitechapel Road, for securing on demand the repayment to them of the sum of £1000, and to Messrs. Seager, Evans & Co. the sum of £1000, now respectively lent and advanced by them to me; with interest thereon respectively at five per cent, per annum from the date hereof, and also for securing, unto the said Sir Henry Meux & Co. and Messrs. Seager, Evans & Co...
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