Morrison-Low v Paterson

JurisdictionEngland & Wales
JudgeLord Fraser of Tullybelton,Lord Diplock,Lord Keith of Kinkel,Lord Bridge of Harwich,Lord Brightman
Judgment Date28 February 1985
Judgment citation (vLex)[1985] UKHL J0228-2
Date28 February 1985
CourtHouse of Lords
Docket NumberNo. 3.

[1985] UKHL J0228-2

House of Lords

Lord Fraser of Tullybelton

Lord Diplock

Lord Keith of Kinkel

Lord Bridge of Harwich

Lord Brightman

Morrison-Low
(Respondent)
and
Paterson and Others
(Appellants) (Scotland)
Lord Fraser of Tullybelton

My Lords,

1

I have had the advantage of reading in draft the speech prepared by my noble and learned friend, Lord Keith of Kinkel and I entirely agree with it. I gratefully adopt, without repeating, his summary of the facts and of the issues in dispute. I add some comments of my own only out of respect for the views of the majority of the learned judges of the First Division, from whose decision we are differing.

2

The dispute which has led to this appeal occurred mainly because of the erroneous advice in law given to both parties by the late Mr. McInnes who, unfortunately, acted for both of them immediately after the death of Mr. Thomas Herbert Paterson. That advice led the landlord (respondent in this appeal) to believe that the lease granted by his predecessors in August 1929, which had been current at the date of Mr. T. H. Paterson's death, would continue thereafter in favour of his representatives. It is now clear that, for the reasons explained by Lord Keith of Kinkel, the lease of August 1929 did not, and as a matter of law could not, continue in force after 4 December 1974, being one year after Mr. T.H. Paterson's death. But the appellants continued to occupy the farm and to pay the rent regularly every half year, as they do up to this day.

3

In these circumstances the Lord Ordinary (Lord Cowie) and the majority of the First Division have upheld the landlord's first plea in law which is to the effect that the appellants have no right to possession or occupation of the farm and that the landlord is entitled to vacant possession of it. The reasons for the majority's decision were first that the appellants had failed to prove that the parties had reached agreement for the new lease at a meeting on 11 September 1974, or on any other particular occasion, and secondly that, on the evidence as a whole, it was impossible to infer that a new lease had been agreed unless (in the Lord President's words) "one abandons common sense." I respectfully agree with the former reason but not with the latter. In my view the facts, which are largely undisputed, point unmistakably to some agreement having been in effect between the parties since 4 December 1974. Rent has been regularly demanded by the landlord and paid by the appellants every half year on 11 or 12 occasions between the death of Mr. J. H. Paterson on 4 December 1973 and the signetting of the summons in November 1979. During that period the appellants, to the knowledge of the landlord, spent a considerable sum of money in improvements to the farm. In September 1978 the landlord made a statutory demand for increased rent. In the face of these facts, it seems to me impossible to treat the appellants as mere squatters. These events could not have occurred unless some agreement had existed between the parties, even though they never made an express agreement or perhaps were conscious of having arrived at any agreement at all. This is an example of rei interventus of the second type explained in Gloag on Contract, 2nd ed. (1929) pp. 46 — 47 in the following passage:

"But when rei interventus is relied upon in cases where parties have not arrived at any agreement, verbal or written, the rule that actings may bind them to a contract is not an exception to the general rule that contract requires agreement. What is really meant is that the actings in question are evidence that agreement has been actually reached, though it has not been indicated in words or in other way than by the actings. In the former case the actings render an agreement binding; in the latter they prove that an agreement was reached."

4

There may be room for doubt about the reasons why an agreement was reached. Probably the landlord originally agreed because he believed that he had no alternative, but he continued to demand and accept rent after he had been advised of the true legal position by Mr. Wilson who took over from Mr. McInnes in 1976. Probably the appellants agreed to what Lord Stott, who dissented in the First Division, described as a "holding operation" until a more permanent agreement could be reached. But whether these were the true reasons or not is quite irrelevant, if the facts show that an agreement of some sort was actually reached as in my opinion they do.

5

I would, therefore, allow the appeal.

Lord Diplock

My Lords,

6

I have had the advantage of reading in draft the speech of my noble and learned friend, Lord Keith of Kinkel. I agree with it and for the reasons which he gives I would allow the appeal.

Lord Keith of Kinkel

My Lords,

7

By lease dated 26 and 28 August 1929 the predecessors in title of the respondent Sir James Morrison-Low ("the landlord") let the farm of Moonzie to Thomas Paterson and his two sons "and their heirs, but expressly excluding heirs portioners (the eldest female always succeeding without division) all assignees whether legal or conventional, direct or indirect, managers or trustees for behoof of creditors, sub-tenants of every description and graziers," for the term of 14 years from Martinmas 1929. One of Thomas Paterson's sons was Thomas Herbert Paterson. He died on 4 December 1973, predeceased by his father and brother. At the time of his death he was sole tenant of the farm of Moonzie, holding by tacit relocation under the lease of 1929. He carried on the farming business in partnership, under the name of Thomas Paterson & Sons, with two of his own sons Ian Thomas Paterson and David Paterson, under a contract of co-partnery dated 27 October 1960 as modified by minutes of agreement dated 12 December 1963 and 11 November 1970. The latter provided inter alia that the partnership should not be dissolved by the death of any one partner, but should subsist so long as any two partners were still alive, until terminated by notice on the death of one of the remaining partners.

8

Thomas Herbert Paterson was survived by a widow, by the two sons who farmed in partnership with him and by a third son Roy William Paterson. He left a will dated 24 December 1971, whereby he appointed as trustees his widow and three sons and also his brother, Norman Paterson, and made over to them his whole means and estate for the purposes therein mentioned. Subject to provisions in favour of his widow and youngest son, Roy William Paterson, he bequeathed the residue of his estate to his elder sons Ian Thomas Paterson and David Paterson, equally between them. He made no specific bequest of the lease of the farm of Moonzie. The trustees appointed by the will were duly confirmed as executors of the testator. The confirmation did not include, as it might have done under sections 14( 1) and 16(1) of the Succession (Scotland) Act 1964, the deceased's interest as tenant under the lease of 1929. David Paterson died on 23 January 1979 and Norman Paterson on 28 June 1981. The surviving executors of the late Thomas Herbert Paterson are the appellants in this appeal. They are in occupation of the farm of Moonzie, and are defenders in the proceedings out of which the appeal arises, in which the landlord as pursuer concludes for decree of removing against them. The Lord Ordinary (Lord Cowie), after hearing proof, granted decree as concluded for, and on a reclaiming motion for the defenders the First Division by a majority (Lord President Emslie and Lord Cameron, Lord Stott...

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