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Decisions of the Superior Courts of New South Wales, 1788-1899

Terry v Inglis [1833] NSWSupC 55

succession - bonds - agency - insolvency

Supreme Court of New South Wales

Burton J., 4 April 1833

Source: Sydney Gazette, 6 April 1833[ 1]

Before Mr. Justice Burton, and a special jury consisting of the following gentlemen: G.T. Savage (foreman), George Druitt, Edward Jones, William Cox, junier [sic], John Tooth, Thomas Marsden, John Lord, Charles Cowper, George Blackett, H.G.Smith, Hambro Clements, and Thomas Collins, Esquires.

Terry v Inglis

This was action brought by the plaintiff to recover £5022, the amount of a bond executed by E.M. Scott, Esquire, agent for the Australian Company in favour of plaintiff.  In the year 1829, Mr. Thomas Raine, with whose affairs the Australian company was connected to a considerable extent, became involved in embarrassment and levy was made by execution at the suit of the plaintiff.  E.M.Scott, agent for the Australian Company, having in their behalf a considerable share in the affairs of Mr. Raine, undertook to satisfy the claim of the plaintiff, and a bond was executed accordingly.  At that time there was property in the estate of Mr. Raine to the value of £2000 more than the amount of plaintiff's claim.  Mr. Scott died before the bond became due, and a demand for payment was made to his successor Mr. M'Lachlan, who came from Van Dieman's Land, to take charge of the Company's affairs at the time of Mr. Scott's decease, and Mr. Thomas Inglis, who was subsequently sent out by the Company to relieve him.  The claim was resisted by he Company as being the act of Mr. Scott, by which it was not rendered liable, he having no authority to bind the Company in the manner specified in the bond.  As regarded the private transactions of Mr. Scott, Mr. Inglis had taken out letters of administration, and had administered to the full extent of the assests, and two please; 1st, Non est factum; 2nd Polena administravi were put in accordingly.

Mr. Wentworth opened the case.

The first witness called, was

F.W. Unwin - I am an attesting witness to the bond in question; I saw E.M. Scott, seal and deliver the said bond; Mr. Scott died in November 1829; I am acquainted with the whole series of transactions which preceded the entering into the bond; Mr. Scott was agent to the Australian Company, and acted under a power of attorney; I did not see the said power at that time; I have seen it subsequently in this court; the act in question of  Mr Scott's was considered by all the parties present, as the act of an agent and not as a principal; I did not regard him in any other way than as an agent, and as such I accepted him in executing the bond; I was not acquainted with Mr. Scott's circumstances; the said bond has already been sued on; I was well acquainted with Mr. Scott; I am not aware of the amount of his income.

By Mr. Wentworth - On a former trial the Chief Justice ruled that, the Company was not liable, and the plaintiff was nonsuited accordingly on that ground; Mr. Scott's power of attorney was submitted to the Chief Justice, who tried the case; I am not aware of any other ground for the nonsuit; that was the principal ground.

W.C. Wentworth, examined - I am an attesting witness to the bond in question; I saw Mr. Scott regularly seal and deliver it; I made enquiries as to Mr. Scott's character in the transaction, before I suffered the said bond to be executed; I considered that Mr. Scott's act on the part of the Company would render the Company liable; all the parties in the transaction were of the same opinion; the plaintiff would not have accepted of such a bond on the part of Mr. Scott as an individual. 

Mr. Unwin, recalled - The date of the bond is 15th October, 1829, for £4000. At 10 per cent. interest; the interest on the said bond is £159. 6s. 4d. which has been paid on account.

John Black - I am cashier of the Bank of New South Wales; I was acquainted with Mr. Scott in his life-time; I recollect his death; he had an account open at the Bank at the time; the balance on his bond was £32. 1s. 3d. which was drawn out of the Bank by Mr. Inglis, on the 15th November 1829, as administrator to the affairs of Mr. Scott; there was also capital stock in the Bank, of Mr. Scott's amounting to £120 which was disposed of in the usual way by Mr. Inglis to Dr. Wardell, on the 4th February, 1831; the said stock was worth more at that time; to the best of my recollection there was a premium on stock, but I am not prepared to say that; there were also three years dividends amounting to £56. 19s. 5d. drawn also by Mr Inglis.

By Dr. Wardell - I have not brought the books and other documents into court; I have made a memorandum from them for the purpose of refreshing my memory; the stock was transferred on the authority in the name of Dr. Douglas, who was a shareholder; I think he appointed Mr. Scott; I do not know whether the said shares were his, or whether he was agent for Dr. Douglass; the shares were registered in the name of Mr. Scott; the deed of settlement is signed by all the parties, except such as have purchased lately; certificates are made transferrable [sic] by endorsement.

By Dr. Wardell - I should not have transferred the stock without authority.

Mr. Gurner - I produce the will of Mr. Scott administration granted to Mr. Inglis; I prove the will and affidavit.

Charles Cowper - I drew up an enumeration of the property left by Mr. Scott, consisting of a 2,000 acre grant at Hunter's River, 1,500 acres purchased from a Mr. Fisher, 600 sheep, 600 horned cattle, 10 acres of land purchased from the Corporation of Clergy and School Lands, forming part of the Glebe Lands on the Parramatta Road, 2 horses, and 4 sheep, and a 1-4th share of the brig Trigis.  Mr. Scott seemed unwilling to give any explanation of this; he said he had not paid, nor were there any papers; I did not take an inventory after his decease; I took an account of monies and bills which were found in the table drawers; the furniture and plate were worth, I should think, about £150; I do not recollect the amount of monies before spoke of; I was accompanied by Major Innes and Mr. Black, accountant to the Company; the above, I believe, includes all Mr. Scott's property, he of course knew that the sheep were mortgaged to their full amount; I was tolerably well acquainted with the affairs of Mr. Scott; I was on friendly terms with him; I do not know what became of the 2,000 acres of land, nor the personal property; I do not know whether the money he had in the Bank was his own or the Company's.

Edward Hunt - I was acquainted with Mr. Scott; I remember being called upon by Mr. Inglis, after the death of Mr. Scott, to appraise certain articles of furniture; it is about 2 years ago; I remember the amount of appraisement was £105; a gold watch was not included in this amount, nor was there any plate; I recollect a fine sideboard, the value of which was £30, was not included; I think the reason Mr. Inglis assigned for not valuing it was, it belonged to the Company.

Cross-examined by Dr. Wardell - I was employed to conduct the funeral of Mr. Scott, the expenses of which was £60; I was paid the amount by Mr. M'Lachlan who was agent for the Company, I am certain the sideboard was not included; I kept the inventory; Mr. Inglis asked me for it, but as it was not usual for appraisers to give the inventory up, I merely gave him the amount; I speak positively as the sideboard not being included.

By Mr. Wentworth - If there is a sideboard in the inventory, and not valued as high as £30, it cannot be the sideboard here alluded to.

Thomas Bodenham - I am an auctioneer; I was employed by Mr. Inglis on two occasions to sell property in Sydney; the first was 14th October, 1831, a cottage residence with garden and ground; I had instructions from Mr. Inglis; Mr. Harper and Thomas Barker were identified with the transaction; I was informed that there was a large sum of money due on mortgage on the property of Mr. Harper; I do not think Mr. Scott's name was mentioned in the transaction; I effected sale of a portion of the ground to Mr. Potts for £190; the remainder was bought in by Mr. Robert How for £700; payment did not pass through my hands; I was subsequently employed to sell a portion of the Glebe land, the property of Mr. Scott; a portion of it was sold to Messrs. J. and J. Brown, sons of one of the directors, and the remainder to R. Inglis, for the Australian Company.

Mr. Unwin, recalled - I made a demand for payment of the bond on 30th of January, from Mr. M'Lachlin; I am not certain whether Mr. Inglis was present on that occasion or not; I apprised the Company of the existence of the bond in March, 1831; most likely I can say it was before Mr. Inglis had taken out letters of administration; I showed the bond and explained the transaction; he said Mr. Scott had no authority to bind the Company; I was Mr. Scott's agent; I held a variety of bills amounting to £1090 which I gave up to Mr. Inglis; I know of a consequence from Mr. Reiby toMr. Scott of a house and premises in George-street, where the business of the Company was carried on; the purchase-money was £3500; I told Mr. M'Lachlan I would hold him responsible for bond as agent to the Company; I also told Mr. Inglis the farm mentioned in the bond was situated at Bathurst.

Mr. Norton - I prepared a deed of mortgage from Mr. Harper to Mr. Scott, it was to secure a sum of £1400; I cannot speak positively as to the sum, as it was not determined on at the time; it was inserted afterwards, the mortgage was on certain premises in Kent-street; I also prepared a deed of conveyance from Mrs. Reiby to Mr. Scott, of the premises in George-street; I think the consideration was £5000 it was 2 or 3 years before Mr. Scott's death.

Mr. John Black recalled - I produce a written instrument authorising me to transfer stock, signed by the Administrator, the stock was £120; I think there was no premium with that sum, the dividends amounting to £56. 19s. 5d. were drawn out by cheques.

Mr. Charles Cowper recalled - The value of Mr. Scott's gold watch was bout £25, the horses £30 each, they were grazing at Mr. Raine's farm at Bathurst; the original value of the sheep was £50 each, there were 300 of them originally purchased; the remainder are the increase; the value of the horned cattle was £1 each at least; I don't know what was the original cost.

Mr. Black - I was accountant to the Company; made up the account between the Company and Mr. Scott; there was a balance against him to the amount of nearly £4000; I made up the account from his own cash book and the Bank book; I am not aware whether he had any effects or not; I was not acquainted with his private affairs.

This closed the case.

After hearing counsel on both sides at considerable length, His Honor left it with the jury to determine, on the 2d plea, whether administration had been made to the full extent of assets.  If the administrator had notice of the existence of a bond, and had notwithstanding satisfied simple contracts, he was certainly liable for the consequences.  What might be considered legal assets to the amount of £2818 had been proved to have passed into the hands of the administrator, while only £60 appeared to have been paid - Verdict for plaintiff.

 

Forbes C.J., Dowling and Burton JJ, 22 June 1833

Source: Sydney Herald, 24 June 1833[2 ]

 

Terry v. Inglis, Administrator of Scott. - This was an action on bond, to recover the sum of £5000 and interest, brought against defendant as administrator - tried last term before Judge Burton and a Special Jury, when a verdict was returned for plaintiff.  Dr. Wardell, on behalf of defendant, now moved, that the nonsuit [sic][3 ] be set aside, and a nonsuit entered on the ground, that the bond sued upon, was made by Scott, as Agent of the Australian Leith Company, and not himself - and that the subscribing witness proved that neither the obligee or obliger intended to have bound Scott.

Mr. Wentworth opposed the motion, on the ground, that where an agent wished to bind his principal, and in so doing exceeded his authority, he was himself liable.  Further, that they had, before this action, brought one against the Company, when they were nonsuited, on the ground that Scott had exceeded his authority, and if Scott was not to be responsible, then they would be remediless.

The Court were of opinion, that the verdict should be set aside and a nonsuit entered - as on the face of the bond, Scott had intended to bind the Company and not himself; in fact, that had appeared on the cross-examination of plaintiff's own witnesses.  If an agent exceeded his authority, he could not be proceeded against upon the bond, but by taut.  On these grounds, the verdict must be set aside and a nonsuit entered.[4 ]

 

Notes

[1 ] For another report of the hearing, see Sydney Herald, 8 April 1833.  See also Sydney Herald, 4 March 1833, on earlier proceedings.

A colonial Act was passed in 1830 (11 Geo. 4 No. 7) to deal with both insolvency (release from prison) and bankruptcy (release from debts as well), but was found to be inadequate after two years.  In April 1832, it was replaced by 2 Wm 4 No. 11 which was a conventional insolvency Act.  Under it, an imprisoned debtor who had been in gaol for more than three months could be released from prison on giving up all of her or his property to the creditors and engaging to pay the whole of the debt should he or she subsequently obtain sufficient property to do so.  See Bourke to Goderich, 19 March 1832, Historical Records of Australia, Series 1, Vol. 16, p. 566; and for the statute, see Sydney Gazette, 29 March 1832; and see Australian, 27 January, 3 February, 30 March, 6 April 1832.

The 1832 Act was a very harsh law, both because of the three months' wait, and because local traders could not obtain the bankruptcy relief which was available to their counterparts in England.

[2 ] See also Sydney Gazette, 25 June 1833; Australian, 1 July 1833.

[3 ] The Sydney Gazette, 25 June 1833, said here that it was the verdict which Wardell wanted set aside.

[4 ] This was recorded in Dowling, Proceedings of the Supreme Court, Vol. 83, State Records of New South Wales, 2/3266, p. 100, as follows: "Per Totam Curiam.  We think this objection fatal.  It would be good in arrest of judgment, or in writ of Error. -  There was here nothing to shew that Scott had exceeded his authority."

Published by the Division of Law, Macquarie University