Dunbar v.
Gill.

July 4, 1908. thirty-one years. The lease here was ex facie only for nineteen years, and was only registrable on the ground that there was an obligation to renew which would bring it over the necessary thirtyone years.1 But at the date of the assignation in security in question here-viz., 1877-the original nineteen years had expired, and the lease had presumably lapsed, and there was no averment on record that the lease had been renewed, nor was there any averment from which such a renewal could be inferred. In the absence of such averments it was not to be presumed that this was either a validly registered lease, or that there was any lease whatever in existence at the date of the alleged assignation in security, and therefore the pursuer had failed to set forth a relevant title. (2) Even if the pursuer had a right to uplift these subrents she could not enforce that right by an action of maills and duties, but must follow the statutory procedure for attaching subrents provided by section 6 of the Registration of Leases Act. The pursuer here was not founding on a common law right of security, but solely on a statutory right, and if she desired to take the benefits of the statute she must strictly follow the procedure laid down by the statute.2 The provisions in the statute of a particular method of attaching subrents excluded by implication the ordinary method, and it had been held that the assignee of a security over a long lease could not have recourse to the remedy of poinding the ground. The reference in section 20 of the Registration of Leases Act to certain clauses in the Heritable Securities Act, 1847, did not help the pursuer, for in the clauses referred to there was no mention of an action of maills and duties. This action therefore should be dismissed.

Argued for the pursuer and respondent ;-(1) There was no question that the pursuer was validly in possession of this security. This was not a lease for nineteen years, but a lease for seven times

tion in security has been granted, or of a term's interest thereof, or of a term's annuity, for six months after such capital sum or term's interest or annuity shall have fallen due, to apply to the Sheriff for a warrant to enter on possession of the lands and heritages leased; and the Sheriff, after intimation to the lessee for the time being, and to the landlord, shall, if he see cause, grant such warrant, which shall be a sufficient title for such creditor or party to enter into possession of such lands and heritages, and to uplift the rents from any subtenants therein, and to sublet the same, as freely and to the like effect as the lessee might have done : Provided always, that no such creditor or party, unless and until he enter into possession as aforesaid, shall be personally liable to the landlord in any of the obligations and prestations of the lease."

Sec. 20. "The several clauses in the Schedules to this Act annexed shall be held to import such and the like meaning, and to have such and the like effect as is declared by the Act of the 10th and 11th of Queen Victoria, chapter 50, sections second and third, to belong to the corresponding clauses in the Schedule to the said recited Act annexed

The Heritable Securities (Scotland) Act, 1847 (10 and 11 Vict. cap. 50), sec. 2, enacts :- "The clause of assignation of rents to become due or payable shall be held to import an assignation to rents from and after (a certain term) including therein a power to the creditor, on default in payment, to enter into possession of the lands disponed in security and uplift the rents thereof subject to accounting.

1 Registration of Leases (Scotland) Act, 1857, sec. 17.

2 Russell v. Campbell, July 25, 1888, 26 S. L. R. 209.

3 Luke v. Wallace, March 13, 1896, 33 S. L. R. 474.

Dunbar v.

nineteen years, and as soon as this tenant had entered under the July 4, 1908. original lease he had a real right for the whole period.1 The lease here, being renewable for a definite period of years, was distinguish- Gill. able from cases where the period was indefinite. Further, in case of a lease with an obligation to renew, if the tenant remained in possession after the expiry of the original period, the renewal was implied.2 The pursuer's averments clearly inferred the continued subsistence of this lease. The defender's statements also clearly inferred it, for the whole nature of her defences on the merits was based on the supposition that the lease still continued. In any event, if the defender had intended to press this point, it should have been raised in the defences by a clear statement that the lease had not been renewed, and any such statement was carefully avoided here. (2) An action of maills and duties at the instance of a holder of a security over a long lease was competent, being imported into the 1857 Act by the reference in section 20 thereof to the 1847 Act. That reference gave the assignation of rents the same effect that it had under the 1847 Act, and one effect of it under that Act was that it could be enforced by an action of maills and duties.3 The fact that another remedy was, in special circumstances, provided by section 6 of the 1857 Act did not affect the question. Both remedies were given by the statute, and there was no reason why they should not exist concurrently.* At advising on 4th July 1908,—

LORD M'LAREN.-This is an appeal from the judgment of the Sheriffsubstitute of Inverness, Elgin, and Nairn, in an action in the form of an action of maills and duties, instituted by the assignee (in security) of a tenant under a long lease granted by the Earl of Seafield of subjects in Grantown. The action is directed against subtenants, and concludes against them for payment of their rents to the secured creditor.

The title founded on is a lease or tack, dated 14th August 1866, which narrates that the Earl's predecessors had let to the deceased John Steuart the subjects in question with entry at Whitsunday 1812, and that for the space of nineteen years, with a promise to renew the said tack or lease for a space of other nine nineteen years. On this narrative Lord Seafield lets to James M'Gillivray (then in right of the obligation), and his heirs and assignees, the subjects as therein described, and that for the space of nineteen years from the term of Whitsunday 1850, which was thereby declared to be the commencement of a third nineteen years' lease, with obligation to renew in terms of the original grant.

The condescendence states that this lease was by James M'Gillivray assigned to Marmaduke Gill, through whom the present tenant, Mrs Elizabeth Macdonald or Gill, derives right. The said Marmaduke Gill assigned the leasehold subjects to William Grant in security of a loan of £700, and the pursuer, Miss Dunbar, has acquired the creditor's right in the bond and assignation in security. These facts are undisputed.

The first objection to the action is that the lease, which, as I have said,

1 Rankine on Leases, 2nd ed., p. 133; Wight v. Earl of Hopetoun, (1763) M. 10,461; Scott v. Straiton, (1771) M. 15,200.

2 Bell's Prin., sec. 1190.

3 Bell's Com., i. 793.

4 The case of Edmond v. Magistrates of Aberdeen, Nov. 16, 1855, 18 D. 47, was also referred to.

Dunbar v.
Gill.

July 4, 1908. is for nineteen years from Whitsunday 1850, has not been renewed. This objection if tabled in the record in the Sheriff Court would probably have been fatal to the diligence. But the objection is purely technical, because Lord Seafield is under obligation to renew the lease, and as it does not appear on the face of the record that the lease has not been renewed, the objection is not raised in a form which makes it necessary for a Court of Appeal to dispose of it.

Lord M'Laren.

The next objection is that an action of maills and duties is not a species of diligence which is open to a creditor who has no higher security than an assignation of a leasehold interest.

It has not been, and could not seriously be, disputed, that the right of a heritable creditor to compel the tenants to pay their rents to him when the proprietor is in arrear, is a right which, at common law, is only competent to a creditor who holds a security over a feudal estate. But, on behalf of the pursuer it was maintained that the Act of Parliament which provides for the registration of long leases in the Register of Sasines (20 and 21 Vict. cap. 26) had put creditors holding securities over registered leases in the same position as proper heritable creditors.

The 20th section of this Act provides that the several clauses in the schedules to this Act annexed shall have the same meaning and effect as is declared by the Act 10 and 11 Vict. cap. 50, secs. 2 and 3, to belong to the corresponding clauses in the schedule to the said recited Act, and also that the procedure for a sale at the instance of a heritable creditor shall be applicable to a sale of any such lease assigned in security. I am here giving only the substance of the clause. Now, the first and second schedules to the Long Leases Act, which are the forms for an absolute assignation and an assignation in security respectively, contain the words, "I assign the rents." I do not doubt that this abridged clause is capable of expansion in terms of the Act 10 and 11 Vict. cap. 50, and that it imports an effective assignment of the benefit of the rents in favour of the creditor. It seems to follow (but I do not wish to express an unqualified opinion on a point which is not before us) that if this assignment were properly intimated to the tenants, the bondholder would have a preference in bankruptcy. But I do not find in either of the statutes referred to anything importing a declaration that the diligence known as an action of maills and duties is to be open to a creditor holding a security over a registered lease.

But for section 6 of the Long Leases Act there might be room for the argument that the power of compelling the subtenant to pay to the secured creditor was given by implication. But as in general an express power will exclude an implied power, where the conditions are different, I must hold that the argument is displaced by the 6th section, which gives a remedy to the creditor ejusdem generis with an action of maills and duties, but under different conditions. The substance of the provision is that where there is default of payment of the capital sum or interest for the period of six months, the creditor may apply to the Sheriff for a warrant to enter on possession of the lands and heritages leased, and that the Sheriff, after intimation, shall, if he see cause, grant such warrant, which, as the statute explains, will empower the creditor to uplift rents from subtenants. Now, an action of maills and duties is a proceeding under which the pursuer may

obtain, as matter of right, a decree in absence, but this is a very different July 4, 1908. right from that of obtaining a warrant causa cognita from a Judge. It is Dunbar v. impossible to suppose that the Legislature intended that these rights should Gill. subsist concurrently, and I therefore come to the conclusion that the pur-Lord M'Laren. suer has been wrongly advised as to her remedy, and that her right to the rents payable by subtenants could only be made effectual by means of a special warrant in terms of the 6th section of the statute. The appeal must therefore be sustained, and the action dismissed.

LORD KINNEAR.—I agree, and I think that the ground your Lordship has stated is sufficient for the decision of the case. We had a variety of criticisms from the Dean of Faculty on the whole procedure before us which, if it were necessary, would require consideration in detail. I am disposed to think that the greater number of the defects pointed out by the learned Dean are mere apparent anomalies which do not go to the substance of the matter at all, and are perhaps necessarily consequent upon the main provisions of the statute. The purpose of the statute, so far as we are concerned, is to enable the holders of leasehold ground to give a real security to their creditors which may be effectual notwithstanding that there is no immediate change in the natural possession; and in order that that design may be carried out the statute authorises, with reference to leases, proceedings which are more properly applicable to rights of property in land, and uses language which is more appropriate to titles of property than to leases. But then it is just because that is so that I think we must be cautious, in reading particular instruments, against being over critical, in case we should thereby be going against the plain design and purpose of the statute. The main purpose of the statute is in itself simple enough, and the methods prescribed seem to me to rest upon perfectly sound analogies, and I am disposed to think that there is no difficulty in carrying out the purpose of the Act. But there remain two objections which appear to me to be formidable. The first, upon which I desire to express no decided opinion, and I think your Lordship in the chair has expressed none, is that the pursuer has not established any sound statutory basis for the procedure at all, because she has not disclosed upon the face of her proceedings that she does hold a statutory security over an existing lease recorded in the Register of Sasines. That is the fundamental basis of the whole proceeding, and if it be so, there is an end of the question. I am not satisfied that the answer to this question which was maintained by Mr Dickson is perfectly sound, because it is a fundamental condition of the pursuer's right to an action of this kind that it should be shewn to be based upon the real right which the statute requires in order to support the proceedings at all. The criticisms upon the defen. der's record may be formidable enough, but an ad hominem argument will not support a diligence in execution against land, and therefore I am not satisfied that the Dean's objection on this point has been met.

But I do not desire to express any final opinion on the subject, which would require an examination of the whole series of instruments, because the other ground upon which your Lordship has proceeded is sufficient. The pursuer's case in support of this proceeding is rested upon the importing of the second section of the Heritable Securities Act, 1847, into the

Dunbar v.
Gill.

Lord Kinnear.

July 4, 1908. Registration of Leases Act, 1857, by the terms of the 20th section of the latter, and the argument is that if these two enactments are read together there is statutory authority for enforcing the right by an action of maills and duties. Now, the second section of the Heritable Securities Act says nothing about an action of maills and duties. The 20th section of the Registration of Leases Act says that the several clauses in the schedules annexed to the Act, which have been followed in the instruments now before us, "are to import such and the like meaning, and to have such and the like effect, as is declared by the Act of 10 and 11 of Queen Victoria, chapter 50, sections 2 and 3," to belong to the corresponding clauses in the schedule to that Act. Now, section 2 of the Heritable Securities (Scotland) Act is the section with which we are concerned, and all that it says, so far as applicable to the present question, is that the clause of assignation of rents shall be held to import an assignation to rents from and after a certain term in the fuller form generally in use, "including therein the power to the creditor, in default in payment, to enter into possession of the lands disponed in security and uplift the rents thereof." Now, if that were the enactment upon which the present pursuer had to proceed, I could see a very sound argument for saying that that must mean an action of maills and duties, because no other process is prescribed for entering into possession, and therefore it might be said that the ordinary procedure known to the law is that which is to be followed. But when we read that provision as part of the Registration of Leases Act, we find that the statute itself provides a special proceeding for entering into possession, because the sixth clause sets out in terms the specific method by which a creditor is to enter upon possession of the lands and heritages and to uplift the rents from any subtenant. I take it to be a general rule of law that when an Act of Parliament creates a new right, and at the same time prescribes a new method of procedure for giving effect to it, anyone who desires to take advantage of the Act must follow strictly the prescribed procedure. The pursuer has not followed the procedure, but has gone outside the terms of the statute, and has adopted a form of procedure which it does not recognise, and therefore I am of opinion with your Lordship that this proceeding falls.

LORD DUNDAS.-I am of the same opinion.

The LORD PRESIDENT and LORD PEARSON were absent.

THE COURT sustained the appeal and dismissed the action. MORTON, SMART, MACDONALD, & PROSSER, W.S.-CLARK & MACDONALD, S.S.C.Agents.

No. 158.
June 16, 1908.

Bell v.
Graham.

WILLIAM BELL, Claimant (Appellant).-Morison, K.C.-Jameson. JOHN GORDON GRAHAM, Respondent.-Johnston, K.C.—Inglis. Lease-Compensation for Improvements-Agreement-Fair and reasonable Compensation-Arbitration-Powers and Duties of Arbiter-Agricultural Holdings (Scotland) Act, 1883 (46 and 47 Vict. cap. 62), sec. 5, and Agricultural Holdings Act, 1900 (63 and 64 Vict. cap. 50), secs. 1 and 2 (1). -The Agricultural Holdings (Scotland) Act, 1883, sec. 5, enacts that where "any particular agreement in writing secures to the tenant" for certain