[2014] CSOH 175




In the cause






Pursuer:  McLain; Thorley Stephenson

Defender:  Watt; Allan McDougall

16 December 2014

[1]        This is an action which called before me at a procedure roll debate on the defender’s first and second pleas in law.  The defender contended that the averments made on behalf of the pursuer were irrelevant and lacking in specification with the consequence that the action should either be dismissed or the averments should be excluded from proof.


[2]        The action is brought by the pursuer against the executor of his former mother-in-law, Ann Bowden Mackay, who died on 15 February 2012.  The pursuer seeks an award of damages averring breach of a contract entered into between himself and Mrs Mackay concerning the purchase by her of a flat at 7 Partick Bridge Street, Glasgow in December 1989.  The defender’s principal contention is that the contract as described by the pursuer is a contract relating to heritage and therefore one which can only be constituted in writing.  Since no written agreement is founded upon the defender contends that the claim for damages is irrelevant, as the agreement founded upon is unenforceable.  The parties were agreed that the Requirements of Writing (Scotland) Act 1995 had no application to the circumstances of the case and that the pre-1995 common law rules regarding the requirements of writing applied.

[3]        It is admitted between the parties that Mrs Mackay lived in the local authority flat at 7 Partick Bridge Street, Glasgow prior to 1989 and that she purchased that property in December 1989 from the local authority, having acquired the right to do so.  The pursuer avers that he lent Mrs Mackay the sum of £8000 in order that she could purchase the property and that they entered a contract in relation to the loan and its repayment.  The pursuer avers that, by discussion, he and Mrs Mackay agreed that she would live in the property for the remainder of her lifetime without making repayment of the loan or any interest related thereto.  The pursuer’s case is that Mrs Mackay undertook to make a will in his favour transferring property in the flat to him on her death and that this was the method by which the parties agreed that Mrs Mackay would repay the loan advanced to her.

[4]        The pursuer also avers that after conclusion of the agreement between them and after he had advanced the sum concerned, Mrs Mackay executed a will in terms of which title to the flat was to be transferred to him.  He goes on to aver that, unbeknown to him, she executed a second will in around January 2003 in which she directed her executors to make over the sale proceeds of her flat to her surviving children, which included his former wife.  The defender acknowledges that Mrs Mackay executed a new will in these terms but asserts that the first will was destroyed prior to the execution of the second and that he is therefore unaware of its terms.  The defender also relies upon the admitted fact that Mrs Mackay granted a Standard Security in favour of the pursuer in November 1991, which bore to be in security of all sums due and that may become due to the pursuer.


Pursuer’s Contentions
[5]        In setting out the basis of the claim brought, counsel for the pursuer accepted, of course, that at common law contracts relating to heritage required to be constituted in writing.  He stressed the importance of the distinction in the common law between a contract relating to heritage and an innominate contract which might be constituted verbally but could only be proved by writ or oath.  It was accepted that such a contract can now be established by proof prout de jure.  His submission was that the contract founded upon in the present case was not one which related to heritage but was more properly described as an innominate and unusual contract, or as an inter vivos obligation to test.

[6]        As an alternative, counsel submitted that if, properly understood, the agreement relied upon did require to be constituted in writing then the defender was personally barred from relying on its improbative nature by virtue of rei interventus.

[7]        In support of his principal argument counsel relied on what was said in Gloag on Contract page 164 and pages 196 to 197, McGinn v Shearer 1947 SC 334, Edmondson v Edmonston (1861) 23 D 995, Johnston v Goodlet (1868), 6 M 1067 and De Lathouwer v Anderson 2007 SLT 438.  In support of his alternative argument counsel relied upon what was said in Gloag on Contract at pages 171 to 175 and in Advice Centre for Mortgages v McNicoll 2006 SLT 591.


Defenders Contentions
[8]        The defender’s contentions were first; that an obligation of the sort relied upon by the pursuer fell into the category of obligations literis and could only be constituted in probative written form, second; that insufficient was relied upon by the pursuer to permit rei interventus to apply and third; that the pursuers averments in general lacked adequate specification.

[9]        In presenting his first argument counsel for the defender relied upon what was said in Erskine’s Institutes Volume II, page 684 and 685, and on the cases of Stone v MacDonald 1979 SC 363, Fisher v Fisher 1952, SC 437 and McEleveen v McQuillan’s Executrix 1997 SLT (Sh Ct) 46.  In support of the second argument counsel relied on what was said in Bell’s Principles of the Law of Scotland at paragraph 26, Rankine’s Treatise on the Law of Leases at page 126 to 128, Colquhoun v Wilsons Trustees 1860 20 D 1035, Pollock v Whiteford 1936 SC 402, Buchanan v Nicholl 1966, SLT (Sh Ct) 62, Secretary of State for Scotland v Ravenstone Securities Ltd 1976, SC 171 and Cusine and Rennie on Standard Securities at page 28.


[10]      Counsel for the pursuer submitted that there was no binding authority determining the character of an obligation such as he founded upon in the present case.  On this basis, his argument was that the agreement founded upon should be seen as an innominate and unusual contract such as, at common law, could only be proved by writ or oath, rather than a contract relating to heritage and thus only capable of being constituted by writing. It was, as he put it, an inter vivos obligation to test.  If counsel is correct in his characterisation then it would also be correct to observe that the modern case of De Lathouwer v Anderson, decided in 2007, is a good example of support for the proposition that breach of a valid inter vivos agreement to test can sound in damages against the granter’s estate.  It is also correct to note that the agreement founded upon in that case was an undertaking to leave and bequeath heritable property.  However, closer examination may show the importance of the qualifying word “valid”.

[11]      Counsel for the pursuer’s argument concerning the proper classification of the obligation upon which he founded commenced with the case of Johnstone v Goodlet, decided in 1868, which, he submitted, concerned a verbal agreement in terms of which the defender had undertaken to grant a deed transferring rights in heritable property on his death.  The contention advanced was that this verbal agreement had been characterised as an innominate contract rather than as an agreement relating to heritage.

[12]      I do not consider that the case of Johnstone v Goodlet provides sufficient support for the contention advanced by counsel for the pursuer in the present case.  In summary, the relevant facts in the case were that a Mr Johnston died in October 1854 and left a trust deed.  He was survived by one male child and three female children, one of whom was married to the defender Mr Goodlet.  She unfortunately died a few days after her father and the subsequent litigation sought to establish that her husband entered into a verbal agreement to make over to the children of his wife’s brother, on his death, the fee of the share of her father’s estate, to which his wife had succeeded just prior to her own death.

[13]      It is difficult to ascertain any more detail concerning the nature of the benefit which was left to Mrs Goodlet in her father’s trust.  The report of the case sets out a summary of the pleadings, the Note of the Lord Ordinary’s decision, and the opinions of the judges of the Inner House.  It is not possible to detect any suggestion of an argument to the effect that the agreement founded upon was a contract relating to heritage and thus only capable of being constituted in writing.  Given that the claim was being contested the absence of such an argument might be thought to be surprising if counsel’s assessment of the import of the case is correct.  At page 1069 of the report there appears an excerpt from the pursuers’ pleadings in which the terms of the agreement founded upon are set out. It is in the following terms:

“The defender was to be allowed to retain his wife’s share of the goods in communion absolutely, except the whole of the share to which she had succeeded on the death of the truster, and this he was to be allowed to retain for his natural life, on condition that the said share, at least, should return on his death, to the children of the pursuer, the said James Johnston.”


[14]      On the same page of the report the terms of a further discussion taken from the pleadings are set out where it is asserted that the defender stated:

“that he would not only return the amount of his wife’s share, but             more, if he should be successful in the world.”


[15]      At page 1068 of the report it can be seen that the conclusion sought by the pursuers was that the defender should be ordained to make over the amount of the share to himself in liferent or to make over the amount or value of the share.

[16]      The report does not disclose that the defender’s wife succeeded to any heritable property on the death of her father and nowhere in the report is any particular heritable property referred to.  She was only one of four surviving children who benefited from the trust deed entered into by their father.  Despite some of the terminology used in the report I am not convinced that counsel for the pursuer was correct in submitting that Johnstone v Goodlet was a case concerning an agreement to transfer rights in heritable property.  As the agreement was summarised in the opinion of the Lord Justice Clerk at page 1072:

“… the purpose of the proposed deed was to make a certain share of a trust deed return to James Johnston’s children”.


[17]      The Lord Justice Clerk considered that an agreement of this sort should be classified as an innominate contract of an anomalous and unusual character, and therefore only capable of proof by writ or oath.  This takes the present pursuer no further forward unless the agreement founded upon was to test in relation to heritage.  For the reasons which I have given I am not persuaded that this is the import of the decision.  Equally, in my opinion, the case of Edmonstone to which the Lord Justice Clerk referred, and upon which counsel placed some reliance, is of no assistance.  It goes to vouch the uncontested proposition that at common law an innominate contract could only be proved by writ or oath.  It adds nothing to the question of how an agreement such as is founded upon in the present case is to be classified, or at least nothing in the pursuers favour.

[18]      In contrast to these older cases, the question of how to classify a verbal agreement to make a will conveying heritable property on death did feature in the case of Fisher v Fisher decided in 1952.  The circumstances of that case are quite similar to the present, in that the wife pursuer claimed that, at the suggestion of her husband, she used money of her own to repay the outstanding balance of a loan secured over their heritable property, following upon which the property was to be re-conveyed to the husband only.  The pursuer’s case was that she agreed to these proposals on the condition that her husband would execute a will leaving the house to her on his death.  He apparently made a will in the terms agreed but subsequently, and unbeknown to his wife, executed a number of other wills in different terms.  In the action brought by the wife against the beneficiaries and executors named in the subsequent wills it was argued on behalf of the defenders that the agreement, as relating to heritage, required to be constituted by probative writ[1] and, as an alternative case, that since it was an innominate and unusual contract it required to be proved by writ of her husband.

[19]      It appears from the terms of the report that counsel for the defenders was told that he need not present his principal argument and the court dealt with the matter on the most favourable view for the pursuer, namely that the agreement might be described as an innominate contract of an unusual kind.  Even taking this view, the court held that some form of writ by the defenders would be necessary for proof of the contract and that none was available.  On this basis the action was dismissed as irrelevant.  However, in giving his opinion the Lord President stated:

“It is strictly unnecessary for us to determine whether this agreement required writing for its constitution, or only required to be proved scripto, though my preference is to say that it required writing for its constitution.”


[20]      The view which the Lord President indicated that he was inclined to would defeat the principal argument presented by counsel for the pursuer in the present case.  Similar factual circumstances came to be considered by Sheriff Principal MacLeod in the case of McEleveen v McQuillan’s Trustees in 1997.  The circumstances of that case were that a loan had been provided in order to enable the purchase of a house upon a verbally agreed condition that the heritable proprietor would convey the subjects to the lender on his death, the same as the factual contentions for the pursuer in the present case.  The Sheriff Principal approached the question by acknowledging that an agreement to make a particular provision in a will was one which fell to be viewed as a contract of an innominate kind, but then asking the question whether an agreement for a particular bequest, if it happens to relate to the bequest of heritage, falls within the rule that requires that agreement to be constituted by probative writ.  Having considered the question of whether the agreement founded upon related merely to testing rather than to heritage, the Sheriff Principal considered what had been said by the Lord President in Fisher.  He concluded that the right to the property in question contended for by the pursuer was a right created nowhere other than in the verbal agreement founded upon and, at least when entered into, it was an agreement representing the final resolution of the parties as to who was destined to own the property.  He therefore concluded that it was an agreement relating to heritage and of a kind which therefore required to be constituted by probative writ.  Since it was not so constituted, he concluded that the owner of the property had locus poenitentiae.  (Or the right to withdraw from the agreement) .

[21]      Sheriff Principal MacLeod’s approach is consistent with the Lord President’s observation in Fisher which, although obiter, is of considerable significance, given that the matter was focused in the pleadings before the court.  In my view, Sheriff Principal MacLeod’s analysis provides a correct exposition of the law and the agreement founded upon in the present case is one which falls properly to be described as a contract relating to heritage.

[22]      In arriving at this decision I have not ignored what was said by Lord Emslie in the case of De Lathouwer v Anderson.  As noted earlier, that case concerned an undertaking to leave and bequeath heritable property.  None of the older cases founded upon by counsel for the pursuer were referred to in the hearing before Lord Emslie, nor were the cases of Fisher and McEleveen.  The reason for this seems clear from a reading of the report.  The agreement which featured in De Lathouwer was constituted by a probative writing in which the owners of the property undertook that they would leave and bequeath the house to the pursuer.  Accordingly, the impediment which faced each pursuer in the cases of Fisher and McEleveen, and which faces the present pursuer, was absent.

[23]      Having arrived at this view the issue of rei interventus requires to be considered. Counsel for the defender accepted that the right to resile which would be present in a purely verbal agreement relating to heritage could be defeated by rei interventus, thus making the agreement binding upon both parties.  However, counsel contended that before this principle could apply the facts founded upon as constituting rei interventus required to be unequivocally referable to the agreement concerned.  An examination of the terms of article 3 of condescendence disclosed that the two facts which the pursuer relied upon as constituting rei interventus were first; the payment by the pursuer of the sum said to have been agreed, and secondly; the claimed execution of the first will in the pursuer’s favour by Mrs Mackay.  As set against this counsel for the defender pointed to the admitted terms of the Standard Security and pointed out that whilst it could have been granted in support of an obligation to test[2], such as was said to exist, it was in fact granted in quite different terms.  Counsel submitted that since the circumstances which were relied upon were of a loan being made within a family context it was impossible to assert that the actings relied upon were unequivocally referable to the terms of a contract as contended for and that the pursuers alternative case should also be dismissed as irrelevant.  In reply, counsel for the pursuer recognised the difficulties which might be encountered in light of the terms of the Standard Security but submitted that the factors which he relied upon were at least capable of having the effect contended for, and that the matter was one for decision after proof.

[24]      Rei interventus is inferred from any proceedings not unimportant on the part of the obligee, known to and permitted by the obligor to take place on the face of the contract as if it were perfect, provided they are unequivocally referable to the agreement and productive of alteration of circumstances, loss, or inconvenience, though not irretrievable – Bell’s Principles paragraph 26.  The proper application of the principle was explained by Lord President Emslie in Secretary of State for Scotland v Ravenstone Securities Ltd at pages 189 and 190 and by Lord Cameron at pages 197 and 198 where they both approved of the test set out in Colquhoun v Wilson’s Trustees.  As the Lord President put it, the actings relied upon “must only be irreconcilable with anything else than the completed relation of buyer and seller” (that being the relationship contended for).

[25]      In the present case the pursuer contends that he entered into a contract the terms of which obliged Mrs Mackay to leave to him in her will the title to the property at 7 Partick Bridge Street, Glasgow.  The only relationship which the pursuer had with Mrs Mackay was that of son-in-law.  By the time she came to execute her second will she had two male children of her own and one daughter.  Although it is not plain whether the male children were born prior to her purchase of the property her only daughter was married to the pursuer by that time.  There is no apparent or stated explanation for the terms of the first will which Mrs Mackay is said to have executed, beyond that contended for by the pursuer. In my opinion therefore the pursuer has set out sufficient by way of factors said to constitute rei interventus to enable him to assert a stateable case.  Whilst it is true that the pursuer’s contention does not sit easily alongside the terms of the Standard Security which Mrs Mackay granted in 1991, the proper impact of this document and the proper weight to be given to the pursuer’s claims, if he can establish them, are all matters for proof.

[26]      Nor do I consider that there is anything in what counsel for the defender called his general pleading point, which was broadly to the effect that the pursuer had not been sufficiently candid in his pleadings concerning the terms of the Standard Security.  The existence of this document was introduced to the pleadings by the defender in the third answer and the impact he states it has is clearly set out, namely that if the pursuer’s claim was correct then the deed ought to have expressed that it was granted in security of a debt ad factum praestandum by which Mrs Mackay was obliged to execute a will bequeathing the property to the pursuer.  It will be for the pursuer to address this apparent impediment to the establishing of his case, but the simple acknowledgement of the terms of the deed by the pursuer does not, in my view, render his remaining averments irrelevant or lacking insufficient specification.

[27]      In these circumstances I will repel the first and second pleas for the defender and allow the pursuer a proof of his averments on record.  I will reserve meantime the question of expenses.


[1] See page 350 of the report.

[2] As vouched by Cusine and Rennie at page 28