Wednesday, April 4, 2012

British Queen PH (2) - Mr Buckland's Fraud

Three days ago I posted about Rick’s Bar, the former British Queen PH, that is set to become yet another betting shop. I did intend my next post to be about the next owner, Edward Trafford, but I have found out a lot more about William Buckland.

Brewers Meux & Co financed Mr Buckland’s purchase of the public house and the lease was deposited with the brewer’s solicitors as security for the loan. Mr Buckland then borrowed the lease on a pretext and fraudulently obtained another loan from another brewery Reid & Co. When Buckland went bankrupt Reid & Co unsuccessfully petitioned the Bankruptcy Court arguing that they should enjoy the usual precedence enjoyed by an equitable mortgagee. The case was heard on 3 May 1848. The vice-Chancellor ordered the sale of the pub and that (in order) payment of the lawyers, Tyler, Meux & Co and in last place Reid & Co.

The pub is on the corner of Tyler Street and it is a reasonable supposition that the William Tyler that Buckland bought the pub from is the Tyler that the road is named after. Buckland also leased the North Pole PH. We also learn that there was an advertising board affixed to the pub announcing that Meux & Co supplied it with porter.


— In the matter of WILLIAM JOHN BUCKLAND.

This was the petition of Messrs. Reid & Co., brewers, for the usual order in the case of an equitable mortgage. The petitioners claimed to be mortgagees of two leasehold public houses held by the bankrupt near Greenwich, one called the North Pole, the other the British Queen. The dispute was as to the latter, the circum stances connected with which, as they appeared upon the affidavits, were as follows:—

By an indenture dated the 14th of September, 1846, and made between William Tyler of the one part, and the bankrupt of the other part, William Tyler agreed to let to the bankrupt the public house called the of British Queen, together with the several fixtures thereon, to hold the Same unto the said bankrupt, his executors, administrators and assigns from the 25th of March, 1846 for the term of 31 years, at the rent of a peppercorn for the first half year of the term, and at the yearly rent of £154 11s for the remainder of the term, payable quarterly, and the bankrupt agreed to take the same, and (amongst other things) agreed that within three calendar months after a licence should be obtained for carrying on the trade of a victualler alehouse keeper or tavern keeper on the premises thereby agreed to be demised, he, his executors, administrators, or assigns, would pay to William Tyler, his heirs and assigns £500 in consequence of such licence having been obtained; and that if such licence should not be obtained within the first year of the term thereby agreed on, then, but not otherwise, William Tyler agreed to allow the bankrupt £85 out of the first year's rent; and it was further agreed that the lease should be granted as soon as a licence should have been obtained for carrying on the said trade or business of a victualler, alehouse keeper or tavern keeper on the premises, and the £500 should have been paid by the bankrupt to William Tyler.

On the 19th of October 1846, the bankrupt deposited the agreement with Messrs. Meux & Co. the brewers, by way of security.

On the 16th of August 1847 Mr Tyler granted to the bankrupt a lease of the British Queen, and also of other hereditaments not comprised in the agreement, in the Woolwich Road, for 75 years from Lady Day 1846, at the yearly rent of £160.

When the lease was executed the bankrupt entered into a bond to Mr Tyler for securing the payment of the £500 mentioned in the agreement, and at the same time he deposited with the landlord the lease, for better securing the payment of that sum.

Shortly afterwards the bankrupt called on Mr. Tyler's solicitors, requesting that they would lend him the lease to produce before the magistrates, who wished to see it before they determined whether they would grant him a licence of the British Queen. To oblige him the solicitors let him have the lease on his positive assurance that he would return it to them, and at the same time he gave them an undertaking to do so.

On the 18th of October 1847 the bankrupt took the lease to Mr. John Walker, an auctioneer and appraiser, with instructions to negotiate with Messrs. Reid & Co. for a loan on the security of that lease, and also for its deposit with them for that purpose. Mr. Walker accordingly applied to Messrs. Reid & Co. for the sum of £73 to be paid to himself, of which Buckland was to receive £50 and for £200L to enable Buckland to pay Messrs. Meux & Co. a debt he owed them, and £100 to finish four cottages which had been built on part of the vacant ground demised by the lease, and such further sums as should thereafter be required to finish the houses remaining to be built thereon. On the 2nd of November 1847, Mr. Walker met the bankrupt by appointment at the Dolphin public house in Coleman Street, when Mr. Walker drew up and the bankrupt signed a letter or order in the following words : —

"Mr Walker, I hereby authorise you to hand over to Messrs Reid & Co., brewers, Liverpool Street, the lease of my house and premises the sign of the British Queen, Woolwich Road, on payment to you of the sum of £73 11s.,and upon the understanding that I, Mr. William Buckland shall have advanced to me the sum of £200 more to liquidate my engagements with Messrs Meux & Co., and the further sum of £100 to finish the four cottages already built, with any other sum that I, Mr William Buckland, may require to build the other four cottages, stipulated to be built in said lease; the amount thereof required for the building of the said other four houses to be advanced as the work progresses to the satisfaction of Messrs. Reid & Co's surveyor. This deposit of the lease of the British Queen also applies as a further security for monies advanced upon the lease of the North Pole Greenwich Road. November 2nd, 1847, W, J, Buckland, Witness Samuel Rogers”

Mr Huggins, Messrs. Reid & Co.'s agent, deposed that, prior to Reid & Co.*s making the advance, the deponent particularly and pointedly asked bankrupt whether he owed Meux & Co. anything, and that the bankrupt told him in answer, that he only owed them a book debt of about £200 or between £200 and £300 and that Walker the auctioneer, told the deponent that bankrupt had told him that he only owed Meux & Co. a book debt of about £200. The deponent said that it is not the custom among the porter brewers of London and its immediate vicinity to hold the deeds of public houses as security for a book debt only. He said, that the letter of the 2nd of November was shewn to him, and that he informed Mr. Walker that he did not acknowledge the conditions set forth in that letter, as he held in his hand another letter, which was also dated the 2nd November, and was as follows : —

" Mr. J. Walker, — Sir, — I request you to deliver to Messrs. Reid & Co. the lease of my premises in Greenwich, to be held by them for a security, as the lease of the " North Pole " is now held with them. — Yours, &c. " W. J. Buckland"

The witness further said that Mr. Walker remarked on the inconsistency of the two letters or orders, but that the witness then and there informed him that he knew nothing of the letter which Mr. Walker produced; that the letter which the witness held in his hand was the bankrupt's authority to Walker to deposit the lease with Reid & Co., and that as a proof of the conditions on which the deponent would receive the deed, the deponent gave an acknowledgment for same on the second letter of the 2nd November, and not upon the other; that the deponent suggested to Walker that he should keep the second letter, as that was his authority for parting with the lease, and as on that letter was an acknowledgment in deponent's handwriting that he had received the lease : that in order to have further evidence of the terms of the deposit, the deponent wrote a paper marked H, which contained a copy of the paper F, and at the foot thereof Walker signed his name to the following memorandum : — ''The above is a copy of the memorandum handed to me on giving the lease to Mr. Huggins”

Mr. Taylor, clerk of Messrs Meux & Co., deposed to the existence of a custom, that if one brewer's firm has made a loan on the security of the lease of a public house, and another firm sends in beer to the same public house, the firm so sending in beer is expected, upon application for the purpose, to pay off the debt due to the firm holding the lease as a security; and the deponent stated, that having entirely attended to the business of the “British Queen,” he was enabled to say that Messrs. Reid never applied to Meux & Co. to pay off any debt due to them from the bankrupt, which they claim to have secured by the lease of the “British Queen." He also deposed to there being fixed to the house a board denoting that Messrs. Meux supplied the house with porter.

In support of the petition it was deposed that when the lease of the '' British Queen " was deposited with the petitioners, the petitioners had no notice or knowledge that there was any agreement for the lease, or that any agreement for the lease had been deposited with Messrs Meux & Co., or that Messrs Meux & Co. had any.

By a deed of November 6, 1847, made between the bankrupt of the one part, and one James Beales of the other part, the bankrupt demised both the ''North Pole " and the " British Queen " to Mr. Beales, upon trust, to secure all such sums as might be due from time to time from the bankrupt, his executors, administrators, or assigns, to any person, upon any equitable mortgage, by deposit of the title deeds of the property thereby demised, or any part of it.

Mr. Swanston and Mr. Jackson in support of the petition. The petitioners, as incumbrancers without notice, and having possession of the lease, and also having a demise of the legal estate to a trustee in their favour, must be preferred to the landlord and Messrs. Meux. The lease must be considered as granted independently of the agreement which Messrs. Meux hold; for the parcels are not the same, nor is the term; and the lease omits all mention of a premium. If the premium had been mentioned, the petitioners would have enquired respecting it.

Mr Russell appeared for Messrs Meux & Co.; Mr K. Parker and Mr Steere for Mr Tyler.

The Vice-Chancellor— If the deed of November 6th had been out of the case, I should have been of opinion that the petitioners would be postponed to Mr Tyler. The debt of £500 was incurred for valuable consideration. That being so, its origin and nature are immaterial. It is an admitted fact that the lease was deposited with Mr Tyler's solicitor for Mr Tyler. It appears that upon a false pretence — neither Mr Tyler nor his solicitor intending to abandon Mr Tyler’s lien, or to enable a fraud to be practised — the lease was handed to the bankrupt, who made a fraudulent use of it. That circumstance did not give to the petitioners priority over Mr. Tyler or over Messrs. Meux, with whom the agreement had been deposited for valuable consideration, giving them a right, as between them and the bankrupt, to have the lease handed to them, so that they acquired an equitable interest in his title to the lease, and therefore an equitable interest in the lease.

It is said that the lease is a different lease from that for which the agreement contracted to a certain extent, that land is added, the rent increased, and the term lengthened. The contract is not, however, otherwise changed. I cannot, therefore, consider the lease as independent of the agreement.

So far, therefore, as the land and the term included in the agreement, I think that, as against the petitioners, the equitable title of Messrs. Meux remains; but I do not understand that Messrs. Meux claim priority or equality as regards the additional land or the additional term. I wish only to hear the case argued on behalf of Mr. Tyler with respect to the deed of November 6th.

Mr. Russell, for Messrs. Meux, said that it was not necessary for them to claim priority as regarded the additional land or term, as the principle of marshalling would apply.

Mr. Swanston for Messrs. Reid, Messrs. Meux can have no right of marshalling against Messrs. Reid.

Not only is the subject of Messrs. Meux’s security limited by the terms of it, but they have no equity to extend it. Mr. Tyler's claim extends to the whole subject, but you cannot on that account marshall to the prejudice of a third incumbrancer.

Mr K Parker, Mr Bacon, and Mr Steere for Mr Tyler, contended that the deed of November 6 was merely voluntary, and, at all events, could not have the effect of postponing Mr. Tyler, inasmuch as the conversation which had taken place between Mr. Walker and Mr. Huggins, affected the petitioners with notice of the memorandum deposited with Messrs. Meux, and, therefore, of the landlord's rights.

The Vice-Chancellor. — The deed of the 6th of November, affecting the legal estate, might have created considerable difficulty, and have varied the rights of the parties, but for the circumstances which have been referred to. It is established that the petitioners had, by means of their agent, in sufficient time, notice of the first document of November 2nd, and that document alludes to the engagement with Messrs Meux & Co. — a common and ordinary security for a publican to give to brewers for a debt from him to them. Accordingly, we find that the expression attracted the attention of Mr. Huggins, and that he pointedly made inquiries of the bankrupt, from whom he received the assurances which have been mentioned. Now, considering what is the common practice of persons engaged in this business, and the manner in which this expression struck Mr. Huggins, and the nature of the engagement entered into, I am of opinion, that there was amply sufficient to put the petitioners, or their agent, upon inquiry, that is, as between themselves and Messrs Meux, to cause them to make inquiries of Messrs Meux. If they had made those inquiries, they would not only have learned the fact of the deposit, but the title of the landlord to the £500, which would have brought them into communication with the landlord.

The Order, as regarded the British Queen public house, was for sale; and that the monies to arise from the sale should be applied, after payment of the expenses, and the costs of all parties, so far as related to the British Queen, in the first place, in payment of what was due to Mr Tyler; secondly, in payment of what was due to Messrs Meux & Co.; and as to the residue, in payment to the petitioners of what should be found due to them, with the usual directions in the event of a surplus, and the usual liberty to prove in the event of a deficiency.

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