Bird v. Bank Of Scotland Plc [2010] ScotCS CSOH_162 (09 December 2010)

Bird v. Bank Of Scotland Plc [2010] ScotCS CSOH_162 (09 December 2010)

Mr Taylor, acting as agent for the defenders when procuring the pursuer's signature on the standard security, committed fraud within the scope of his authority; therefore, the defenders cannot benefit from the fraud and the standard security (including personal bond) falls to be reduced. However, the contract of loan remains enforceable as funds were advanced to the pursuer's agent, and the pursuer is not entitled to repetition of sums paid, while the defenders are entitled to payment of principal and interest under the loan.

Citation
[2010] ScotCS CSOH_162
Parties
Pursuer: Andrew David Bird; Defender: Bank of Scotland plc
Jurisdiction
Scotland
Judgment Date
09 December 2010
Procedural Posture
Civil Action for Reduction, Repetition, and Damages; Counterclaim for Payment / Debate (preliminary Hearing on Relevancy)
Outcome
Decree of reduction of standard security (including personal bond) granted; pursuer not entitled to repetition; defenders entitled to payment under contract of loan; interlocutor not pronounced immediately, case put out By Order for further procedure.
Legal Topics
Reduction of Standard Security, Fraudulent Misrepresentation, Agency Liability, Contract of Loan, Personal Bond, Repetition of Payments, Counterclaim for Loan Repayment
Property Law Contract Law Agency Law Fraud Reduction of Standard Security Fraudulent Misrepresentation Agency Liability Contract of Loan +3 more

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Parties

Andrew David Bird

Pursuer

Bank of Scotland plc

Defender

Procedural Posture

Civil Action for Reduction, Repetition, and Damages; Counterclaim for Payment / Debate (preliminary Hearing on Relevancy)

Legal Issues

  1. 1 Whether the standard security (including personal bond) granted by pursuer should be reduced due to fraud of agent
  2. 2 Whether pursuer is entitled to repetition of sums paid to defenders
  3. 3 Whether defenders are entitled to payment under contract of loan

Ratio Decidendi

Mr Taylor, acting as agent for the defenders when procuring the pursuer's signature on the standard security, committed fraud within the scope of his authority; therefore, the defenders cannot benefit from the fraud and the standard security (including personal bond) falls to be reduced. However, the contract of loan remains enforceable as funds were advanced to the pursuer's agent, and the pursuer is not entitled to repetition of sums paid, while the defenders are entitled to payment of principal and interest under the loan.

Court Disposition

Decree of reduction of standard security (including personal bond) granted; pursuer not entitled to repetition; defenders entitled to payment under contract of loan; interlocutor not pronounced immediately, case put out By Order for further procedure.

Orders

  • Reduction of standard security (including personal bond)
  • No repetition of sums paid by pursuer