Page images

abolish the distinction between specialty and simple contract debts, but merely declared that they should be paid pari passu. The Court's objection to allowing that the distinction was abolished was due to its reluctance to improve the already privileged position of the Crown, by giving its simple contract debts a preference over the specialty debts of other creditors (as to the practice see In re Bentinck, L. R. [1897], 1 Ch. 673); or to extend the executor's rights of preference and retainer. The Irish Courts, however, took a different view, and held that the effect of Hinde Palmer's Act was to abolish the distinction between specialty and simple contract debts. This view was ultimately adopted also by the Court of Appeal in England in In re Samson, (L. R. [1906], 2 Ch. 584), which was a case of an executor preferring a simple contract debt to a specialty debt, and the Court, in deciding that he was entitled to do this, expressly refused to consider whether the rule extended to the right of an executor to retain his own debt. But clearly the principle that Hinde Palmer's Act abolished the distinction between specialty and simple contract debts, could not logically be limited so as to exclude the right to retain. The Irish Courts held that an executor could retain his own simple contract debt against another creditor's specialty debt (Olpherts v. Coryton [1913], 1 Ir. R. 211), and now in In re Harris (supra) Sargant, J., has adopted the same view.

The second point decided in In re Harris (supra) was scarcely arguable. The plaintiff executor who wished to prefer, claimed as a trustee of a settlement of which the testator had been a trustee, and in respect of a debt arising in equity against the testator owing to a breach of trust committed by him. The plaintiff was not a trustee at the testator's death, but was subsequently appointed, and it was contended that as executor he could retain only as to debts.

due to him at the testator's death. The point was already decided to the contrary in In re Barrett (L. R. [1889], 43 Ch. D. 70); and that decision has never been questioned. Indeed, it was only very recently practically followed, when in In re Jones (L. R. [1914], 1 Ch. 742), it was held, that an executor who at the testator's death was not a creditor of the testator, but who afterwards paid some of the testator's debts out of his own money, could, when assets came to his hands, retain out of them for the repayment of the money advanced.

Another interesting decision is Lord Ashburton v. Noctin (L. R. [1914], 2 Ch. 211). That case turned upon the point as to what steps are now necessary to make a judgment debt a charge upon the judgment debtor's land. This law depends on four separate statutes. First, the Judgments Act 1838 simply provided that judgment debts should be a charge on the judgment debtor's interests in land, whether legal or equitable. Then the Judgments Act 1864 provided that judgments should not affect the land till it was actually delivered in execution. Later, the Land Charges Registration and Searches Act 1888 enacted that writs and orders "affecting land issued or made by any Court for the purpose of enforcing a judgment. . . and any order appointing a receiver or sequestrator of land," might be registered at the Land Registry. Lastly, the Land Charges Act 1900 repealed the provisions of the Judgments Act 1864, as to the necessity of the land being actually delivered in execution, and enacted that a judgment shall not operate as a charge "unless or until a writ or order for the purpose of enforcing it is registered" under the Land Charges Registration and Searches Act 1888.

[ocr errors]

Now a writ of elegit is the ordinary way of enforcing a judgment against land; but such a writ can have no effect

where the judgment debtor has only an equitable interest -say for instance, where the land is mortgaged. Accordingly, under the practice before the Land Charges Act 1900, it was held, that where the debtor's interest was equitable, no order to enforce the judgment had been made till a receiver had been appointed by the Court; since till then there was no order affecting the land within the Judgments Act 1864. That Act, as far as this point is concerned, is repealed by the Land Charges Act 1900, which moreover says nothing about judgments affecting land. Is then a writ of elegit a writ for enforcing a judgment within the Land Charges Act 1900, so that the registration of it will be sufficient to give the judgment creditor a charge on the debtor's equitable estate in land? The Court held it was not; and that the only order which, when registered, created a charge on a judgment debtor's equitable estate, was an order for the appointment of a receiver.

The case of Millbourn v. Lyons (L. R. [1914], I Ch. 34), which we were somewhat disposed to doubt (see Law Magazine and Review, Vol. XXXIX, p. 357), has now come before the Court of Appeal and been affirmed (L. R. [1914], 2 Ch. 231). The judgments there delivered have convinced us that our doubt was unfounded. The question was as regards a restrictive covenant which by the contract of sale was reserved for the benefit of the vendor's other neighbouring property. When, however, the conveyance was actually executed, the vendor had sold the property in question. It was contended that the buyers of this property should be entitled to the benefits of the covenants, because the contract gave the purchaser an equitable estate subject to equitable easements, and these existed after the contract had been completed by conveyance. As the Court pointed out, the effect of this view, if adopted, would be to make the contract of sale a part of the title, and to leave the rights

This was

of the parties dependent on both instruments. certainly not what Broomfield v. Williams (L. R. [1897], I Ch. 602) decided, when the Court of Appeal held that it was, at the time, not of conveyance but of contract, that the rights of the parties were determined. All that meant was that, in construing the terms of the conveyance, the Court, in order to determine the meaning of the parties, should look at the state of things existing when the transaction was initiated, not at the time when it was completed.

A rather amusing case is that of English v. Cliff (L. R. [1914], 376), where it was actually contended that a limitation was void from remoteness because it was to arise "at the expiration of twenty-one years" from the execution of the instrument creating it. This contention was based on the ground that, since the limitation was only to arise "at the expiration of twenty-one years," it was not good within the rule against perpetuities which requires the limitation to arise "within" twenty-one years. The Court summarily disposed of this argument by holding that the expiration of the twenty-one years and the rising of the following limitation were simultaneous events, therefore the latter could not be said to be outside the period allowed by the rule.

J. A. S.

It was quite certain that contentions would arise as to the interpretation of sect. 46 and sect. 2 of the Finance Acts of 1910 and 1912 respectively. Put very briefly, the Act of 1910 aimed at "tied" houses, and entitled a licence holder to recover, from persons from whom he was bound to purchase intoxicating liquors, a part of any increased duty payable for licence, proportionate to any increased rent, or to any increased prices for liquor supply, charged

to him by reason of the monopoly. The Act of 1912 aimed at "free" houses held under a lease made before the Act of 1910, and entitled the lessee to recover from the grantor a part of the increased licence duty under the Act of 1910, proportionate to any increased rent or premium in respect of the premises being let as licensed premises. In Watney, Combe, Reid & Co. v. Berners (L. R. [1914], 3 K. B. 288), the plaintiffs obtained, at a rent of £150 a year, a lease of a public-house already licensed but "free," and sublet it as a "tied" house at practically the same rent, they themselves paying the licence duty. They sought under sect. 2 of the 1912 Act to bring in the grantor as a contributor towards the increased licence duty, on the ground that the yearly rental of the house, without a licence, would be only £90. The question was, as Kennedy, L.J., said, not an easy one to solve, as was shown by the differences of opinion delivered. The Divisional Court, reversing the County Court judgment, had decided in favour of the defendant; and now on the appeal Lord Sumner differed from his colleagues. Some of the points of the decision which was in favour of the defendants were that, by the terms of sect. 2 of the Act of 1912, a lessee would include a lessee who is not the occupying tenant but has sublet. This was so far in favour of the plaintiff. But a licence holder is the only person upon whom the 1910 Act imposes the increase of duty, and to him it is that relief is afforded under both Acts. The lessee under sect. 2 of the 1912 Act is the person entitled to relief by a reduction of rent due from him to his lessor; and therefore the lessee is the licence-holder lessee. The contrary view would create a continuous chain of liability to contribute towards the increase of duty, extending from the licence holder, through sub-lessees, to the grantor both included. But a decision of the House of Lords will be required before all doubt is dissipated.

« PreviousContinue »