M'Phersons v. Haggarts

James Reid Haggart attained majority in April 1879, and on 25th June in that year he granted to the bank an obligation of guarantee for all sums for which M'Pherson might be or become liable to them, the amount payable under the guarantee not to exceed £500, with interest from the date of advance, and the guarantee to remain in force till recalled in writing. Before this letter of guarantee of 25th June 1879 was granted by James Reid Haggart, Donald M'Pherson had drawn on the credit to the amount of £511, 1s. 7d.

They averred that they had been asked by the principal debtor to be cautioners for him ad interim only till James Reid Haggart should reach majority, and that they had agreed to be cautioners only to this limited extent. Of this they averred that the bank was aware, and further they averred that the bank had consented and agreed to the credit being given to Donald M'Pherson on these terms.

* The judgment on this point is reported infra , immediately following the case of Wannop.

They pleaded—“(1) The pursuers not being cautioners after the second letter of guarantee was granted by the said James Reid Haggart, are entitled to decree of declarator, relief, and redelivery of their obligation as concluded for. (2) The assignation to the defender John Haggart being the result of fraud, the same falls to be reduced.”

The defenders denied that the pursuers' obligation of guarantee was of an interim character, and maintained that it still subsisted. They denied that the assignation had been fraudulently taken.