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upheld the
Thomsons' argument that, because in delivering the disposition, Albyn could no longer make use of or sell the house, it had no "Beneficial Interest" in the house and this was enough to remove it from being part of its property. Lord Jauncey commented that the ability to sell the house in
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offered different reasoning. He said that the term "Property and
Undertaking" used in the Charge Agreement and the legislation had to be construed in its context. He said the Court of Session was wrong to ascribe it a technical meaning. He said that a proper construction of the term was to include
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The case caused great confusion in
Scottish Conveyancers and academics who saw it as over-turning the long established Scots law principle that ownership could not be divided. However, the effect of the case was greatly reduced by the House of Lords in 2004 in Burnett's Trustee v Grainger UKHL 8
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contesting that, since the disposition hadn't been registered, the ownership of the house remained with Albyn at the time of attachment and that it and the purchase price was available to the Bank as holder of the charge. The
Thomsons responded that the act of delivering the disposition divulged
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to the
Thomsons, a brother and sister. Albyn had agreed to sell the house to the Thomsons leading to the completion of the missives and the delivery of the disposition and the payment of the purchase price. However, before the disposition was registered by the Thomsons, Albyn defaulted on a loan
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Albyn of any "Beneficial
Interest" in the house and that this was enough to remove it from the scope of the charge. The Inner House of the Court of Session found in favour of Sharp. In giving the leading opinion, The Lord President (
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and that ownership could only lie with the holder of the recorded title. As the
Thomsons had not recorded the disposition, title remained with Albyn and so the house was available to Sharp.
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where the Court held that Sharp v
Thomson was authority only for holders of floating charges. For all other sales of property where the seller goes bankrupt or into
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held by the bank over all of Albyn's "Property and
Undertaking", and Sharp was appointed Receiver to collect this for the Bank.
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only what the company could make use of in its day-to-day business dealings and not all its property in a strict legal sense.
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29:. The case was brought by Sharp as receivers for Albyn Construction Ltd, a building company who had sold a house in
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54:) drew on historical sources to argue that Scotland has, and has always had, a unitary system of
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and found in favour of the
Thomsons. The House gave two main reasons for its decision.
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151:"Comparative Case Notes: Burnett's Trustee v. Grainger as an Example"
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The Thomsons appealed to the House of Lords. The Court overruled the
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fraud of the disposition did not amount to a right in property.
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decision regarding the status of an unrecorded disposition in
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130:. The University of Edinburgh, School of Law
38:. The default lead to the attachment of a
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108:Discussion Paper on Sharp v Thomson
21:1997 SC(HL) 66 is a United Kingdom
45:Sharp raised an action before the
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197:United Kingdom property case law
124:"Distinguishing Sharp v Thomson"
105:Scottish Law Commission (2001).
192:1997 in United Kingdom case law
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111:. Scottish Law Commission.
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187:House of Lords cases
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182:Scots property law
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160:16 April
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