Glendinning v. J. D. Hope & Co. [1910] ScotLR 111_1 (09 December 1910)

Glendinning v. J. D. Hope & Co. [1910] ScotLR 111_1 (09 December 1910)

The defenders failed to prove by clear and cogent evidence the existence of a binding custom on the Edinburgh Stock Exchange entitling stockbrokers to retain clients' scrip as security for open accounts. The transfer was in the defenders' possession solely for the purpose of completing a transaction already paid for, and their failure to deliver it in due course was a breach of contract. Therefore, the defenders had no right to retain the transfer against a subsequent debt.

Citation
[1910] ScotLR 111_1
Parties
Pursuer: James P. Glendinning; Defenders: J. D. Hope & Company and John D. Hope
Jurisdiction
Scotland
Judgment Date
09 December 1910
Procedural Posture
Civil / Appeal (reclaiming Motion) From Lord Ordinary to Inner House
Outcome
Appeal allowed; interlocutor of Lord Ordinary recalled; defenders found to have no right of retention; cause dismissed as transfer already delivered.
Legal Topics
Stockbroker's Lien, Local Custom, Retention of Scrip, Proof of Custom, Delivery of Share Transfer
Commercial Law Securities Law Stockbroker's Lien Local Custom Retention of Scrip Proof of Custom Delivery of Share Transfer

Case Brief

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Parties

James P. Glendinning

Pursuer

J. D. Hope & Company and John D. Hope

Defenders

Procedural Posture

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

Legal Issues

  1. 1 Whether a custom exists on the Edinburgh Stock Exchange entitling stockbrokers to retain clients' scrip as security for open accounts
  2. 2 Whether the defenders were entitled to retain the transfer of shares against a balance due from a subsequent transaction

Ratio Decidendi

The defenders failed to prove by clear and cogent evidence the existence of a binding custom on the Edinburgh Stock Exchange entitling stockbrokers to retain clients' scrip as security for open accounts. The transfer was in the defenders' possession solely for the purpose of completing a transaction already paid for, and their failure to deliver it in due course was a breach of contract. Therefore, the defenders had no right to retain the transfer against a subsequent debt.

Court Disposition

Appeal allowed; interlocutor of Lord Ordinary recalled; defenders found to have no right of retention; cause dismissed as transfer already delivered.

Orders

  • Authorise the pursuer to uplift the sum of £55 consigned in bank, with all interest thereon.
  • Grant warrant to the Accountant of Court to deliver the consignation receipt to the pursuer and to the North of Scotland and Town and County Bank, Limited, to pay the sum therein to the pursuer or his agents.