34
word 'compromise' in this context seems to have been introduced in Gloag on Contract (2nd ed.) at p. 456, and repeated by Lord Keith of Avonholm in Hunter v. Bradford Property Trust Ltd. at p. 190. Stair numbers 'transaction' amongst mutual onerous contracts (Inst., I. x. 12) as a nominate contract—in which law determines the implied terms; as he puts it: 'Transaction may well be numbered amongst mutual onerous contracts, for thereby either party quitteth a part of what he claims, for shunning the hazard and expences of law'. In the first edition of his Institutions (1681) Stair wrote of 'transaction': 'Which, being an useful mean to terminate pleas, the law of this and most nations observe the same inviolably, and will not admit the recalling thereof, upon anything can be pretended from new discovery of the parties' rights, or finding of writs or witnesses; but if nothing be abated, there is no transaction'. There is nothing in this passage or in that quoted by Lord Keith in Hunter which requires that every issue in dispute be set out in detail, provided the cause or causes of dispute are identified or identifiable and the agreement necessarily involves a quittance or abatement of part of what the parties claim as their rights. It is in these circumstances that this implied condition is brought into operation and operates so as to extinguish any subsequent claims arising out of those rights which have been compromised." (Emphasis added.)
Accordingly, the Agreement superseded whatever the parties' rights and obligations may have been prior to the commencement of proceedings. As there was no judicial determination of the parties' respective rights and obligations, no issues of res judicata arise, and the parties' rights and obligations are governed by the common law of contract. As the defender has failed to aver a relevant defence to the binding nature of the Agreement, the pursuer's first and second pleas-in-law should be sustained and decree of declarator should be pronounced in terms of the first conclusion.
The Disputed Wording breaches the Agreement
[61] The Disputed Wording introduced by the defender in no longer makes any reference in Letters Patent to the Deed of Assignation transferring the barony breaches the obligations imposed upon the defender by paragraph 4(i) of the Agreement. Mr Lindsay referred to the correspondence anent the Disputed Wording, which I have already noted above.
