Dickson v. National Bank of Scotland [1916] ScotLR 448 (03 March 1916)

Dickson v. National Bank of Scotland [1916] ScotLR 448 (03 March 1916)

The authority of a partner under section 38 of the Partnership Act 1890 continues after dissolution for the purpose of winding up the partnership or completing unfinished transactions. The uplifting of the consigned money was necessary to wind up the affairs of the dissolved firm. The bank, having paid on the genuine signature of the firm as specified in the receipt, discharged its duty and is not liable for subsequent misappropriation by the partner. There was no relevant averment or plea of negligence against the bank.

Citation
[1916] ScotLR 448
Parties
Pursuer: Mrs Dickson and others (residuary legatees of Adam Robertson, as assignees of his sole surviving trustee and executor); Defender: National Bank of Scotland, Limited, Edinburgh
Jurisdiction
Scotland
Judgment Date
03 March 1916
Procedural Posture
Civil / Appeal (reclaiming Motion) From Lord Ordinary to Inner House, Second Division
Outcome
action dismissed
Legal Topics
Authority of Partners After Dissolution, Mandate and Agency, Bank Liability for Payment on Deposit/consignation Receipt, Partnership Act 1890 Section 38, Negligence in Payment of Funds
Banking Law Partnership Law Trusts and Estates Authority of Partners After Dissolution Mandate and Agency Bank Liability for Payment on Deposit/consignation Receipt Partnership Act 1890 Section 38 Negligence in Payment of Funds

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Parties

Mrs Dickson and others (residuary legatees of Adam Robertson, as assignees of his sole surviving trustee and executor)

Pursuer

National Bank of Scotland, Limited, Edinburgh

Defender

Procedural Posture

Civil / Appeal (reclaiming Motion) From Lord Ordinary to Inner House, Second Division

Legal Issues

  1. 1 Whether a bank is liable for paying out funds on a consignation receipt on the signature of a dissolved firm eight years after dissolution
  2. 2 Whether the authority of a partner under Partnership Act 1890, section 38, extends to uplifting funds for winding up the partnership
  3. 3 Whether the bank was negligent in making payment without further inquiry

Ratio Decidendi

The authority of a partner under section 38 of the Partnership Act 1890 continues after dissolution for the purpose of winding up the partnership or completing unfinished transactions. The uplifting of the consigned money was necessary to wind up the affairs of the dissolved firm. The bank, having paid on the genuine signature of the firm as specified in the receipt, discharged its duty and is not liable for subsequent misappropriation by the partner. There was no relevant averment or plea of negligence against the bank.

Court Disposition

action dismissed

Orders

  • Interlocutor of the Lord Ordinary recalled
  • Second plea-in-law for defenders sustained