The final word

Title to sue

In Nicol v Nine Regions Ltd 2008 GWD 31-469, Sheriff McCormick determined that a person who had signed a trust deed and had raised an action seeking to set aside her duties in terms of a hire purchase agreement had no title to sue, where the trustee had given no indication of abandoning a right to pursue a similar remedy and had indicated that any sums recovered would be treated as acquirenda.

Prorogation of jurisdiction

In Rolf Barkmann GmbH v Innova House Ltd 2008 GWD 33-490 an issue arose regarding article 23 of Council Regulation (EC) 44/2001, by which an agreement to prorogate jurisdiction shall be (a) in writing or evidenced in writing, or (b) in a form which accords with practices which the parties have established between them, or (c) in international trade or commerce, in a form which accords with a usage of which the parties are or ought to have been aware and is widely known and regularly observed by parties to contracts in such a trade or commerce. An allegation that there had been an oral agreement followed up by a fax confirming the terms without subsequent dissention, satisfied the first condition. There was insufficient to establish a prior practice between the parties or that any trade practice was widely known.

Forum non conveniens

In B v B [2008] CSIH 52, the Inner House upheld the pursuer’s appeal against a plea of forum non conveniens being upheld. Aberdeen Sheriff Court had jurisdiction in relation to issues such as the dissolution of the parties’ marriage. Both parties had been habitually resident in Aberdeen prior to separation. They had a closer connection to Aberdeen as a result. The location of witnesses was of no great significance in light of this. The availability of legal aid was not irrelevant.

Limitations on evidence

Royal Bank of Scotland plc v Haughey [2008] CSOH 142 raised the issue at debate whether evidence could be led concerning other alleged fraudulent activity on the part of one defender, who sought to have averments deleted from probation on the basis that they constituted collateral issues. On reviewing authority, Lord Glennie observed that such averments required to have a reasonably direct bearing on the subject matter in the litigation. They required to be pertinent and relevant to the issue to be tried. Expediency was also an issue – in short a line had to be drawn somewhere. That line was drawn by the exercise of judicial discretion.

Summary decree

In Van Klaveren v Servisair (UK) [2008] CSOH 136; 2008 GWD 32-477, summary decree was granted restricting further issues to quantum on the basis of liability having been admitted on a reasonable interpretation of the terms of correspondence. The admission had been accepted and subsequent correspondence related simply to quantum. This decision is perhaps worth noting from two points of view. First, some care may require to be taken in relation to correspondence. Perhaps more pertinently, it is a reminder that a motion for summary decree can be used not simply to deliver the knockout blow, but to enable certain issues to be removed from consideration.

The granting of a motion for summary decree at a case management conference in a commercial action in Glasgow was successfully appealed in ASC Anglo Scottish Concrete v Geminax [2008] CSIH 55. Whilst the particular details are not that relevant, Lord Eassie, delivering the opinion of the Inner House, observed that if a motion for summary decree is made early in procedure when pleadings are not settled, the court must have regard to that and should not dismiss any submission that information is or will come to hand to advance a defence. Whether there is no defence to an action is dependent on the stage the action has reached and the information available. At an early stage such information may be to the effect that relevant information is available. I have always thought that such a motion is unlikely to be granted prior to an options hearing. That said, early enrolling of a motion may smoke out information or the lack of it!

As an aside, the Inner House also expressed a view that it was inadvisable to deal with such motions by means of conference calls. Practical difficulties such as proffering further documents or effectively referring to authority were clear.

Undue delay

The decision in Tonner v Reiach and Hall 2008 SC 1 was revisited in Cameron v Hughes Dowdall [2008] CSOH 151. An action for damages for professional negligence allegedly occurring in 1989 was raised in 1994. The record closed in November 1996 and the action went to debate in May 1997. This was discharged and the cause sisted for a second legal aid application. The pursuers had instructed four firms of solicitors. The first two acted from 1989 to May 1996. The pursuers had complained as to the handling of the claim by one firm. The third had acted from May 1996 for 14 months. They ceased to act when an opinion unfavourable to the claim was obtained from an expert they had instructed. Difficulties further arose with one of the pursuers’ legal aid certificates. Temporary Judge Morag Wise QC refused to dismiss the action. She considered that the period which required to be examined most closely was the period from July 1997. No steps had been taken in the court process during that period. The delay was, however, excusable. There had been considerable legal aid difficulties linked with difficulties in obtaining a favourable expert opinion. Even after sanction had been obtained it took almost three years for an opinion to become available. Further, although the partner in the defenders who was alleged to have been negligent had since died, there was minimal prejudice as the basis of claim remained the same and the files were available. The issue of quantum was not one on which he could have commented.

Appealing post extract

The issue of extract decree normally prevents an appeal being taken. This has been emphasised in two recent decisions. In Kevan M Smith Ltd v Tevendale 2008 GWD 32-479 decree by default had been granted for the sum craved. However, in the course of procedure this sum had been reduced. The reduced sum appeared in the options record. Notwithstanding this, at the peremptory diet decree by default was granted in terms of the craves for the greater sum! This decree was extracted. The defender then sought to appeal. Sheriff Principal Young determined that the extract had not been improperly or incompetently issued notwithstanding decree was granted for the wrong sum.

A more extreme example is found in Zlatarits v Zlatarits, Dunfermline Sheriff Court, 15 October 2008. Decree of divorce had been extracted and the pursuer sought to mark an appeal late. Unlike the situation in Smith, Sheriff Principal Dunlop seems to have been sympathetic to an appeal being allowed to be marked late. The problem was the extracting of the decree. An options hearing had been discharged and the cause continued for settlement. Terms had been agreed subject to a minor matter. The defender’s solicitor drafted a joint minute and sent it to the pursuer’s agent. The defender’s agent had appeared for both parties when the options hearing was discharged. Four days prior to the next calling the pursuer’s agent wrote to the defender’s agent asking that he appear for both parties. That letter was not received until the day after the case called. At the calling, the pursuer being unrepresented, the defender’s agent moved for decree of dismissal, which was granted. At the appeal, the pursuer did not challenge that such a disposal was competent. The defender’s agent did not respond to his opponent’s letter or a reminder. He sought an extract of the decree. The first indication the pursuer’s agent received was the instigation of further proceedings.

At the appeal the pursuer’s agent contended that the extract had been obtained in bad faith. Accordingly it could be set aside. The defender’s agent argued that he had done nothing wrong. His duty was to his client alone. Sheriff Principal Dunlop reviewed sheriff court authority which suggested that an appeal might be allowed notwithstanding the issue of an extract, first if that extract had been issued incompetently or improperly, or secondly if the interlocutor itself was incompetent or obtained irregularly. In Alloa Brewery Co v Parker 1991 SCLR 70 the Inner House seemed to suggest that invalidity of the interlocutor pronounced might allow an appeal to be taken notwithstanding the issue of an extract. In the present case, the interlocutor had been properly pronounced and the extract properly issued. In those circumstances the appeal was refused. There were good reasons as to why an extract competently issued of an interlocutor competently pronounced should not be subject to appeal. I suggest that the circumstances of this case emphasise how difficult it is to appeal after an extract has been issued. I suspect the majority of agents have considerable sympathy for the position of the pursuer’s agent.

Summary cause

In O’Carroll v Ryanair, Aberdeen Sheriff Court, 11 September 2008, the issues which had been noted at the preliminary hearing did not include any suggestion that quantum was in dispute, but simply liability. Accordingly, the sheriff at the second hearing refused to entertain any such argument regarding quantum. Sheriff Principal Young agreed with the sheriff’s approach.

Liquidation

On 4 September 2008 Lord Glennie dealt with petitions of Purewal Enterprises Ltd for the winding up of two companies ([2008] CSOH 127). The exact facts are not of specific concern. What is of significance are Lord Glennie’s observations regarding applications to appoint provisional liquidators. It is not unknown for me to be requested to appoint a provisional liquidator when a petition for winding up is presented. Such an application is supported by minimal averment in the petition and the accompanying letter seeks the appointment of such a person. Once I indicate that I wish to be addressed, invariably the sheriff clerk is simply asked for the normal warrant for intimation. Perhaps an inference can be drawn!

In any event Lord Glennie observed that such an appointment is only made if the court is persuaded that there is a prima facie case for winding up, namely a good arguable case, and there is a real risk that without the order the directors will take steps to remove or dissipate the company’s assets. Such an appointment has serious consequences for the company and there is a duty on a party seeking such an order to make a full and frank disclosure when the application is made. This should cover all matters which may affect the consideration of the court in making such an order, both favourable and unfavourable. Agents unaware of this please take note.

Update

Since the last article, Sinclair v The Private Rented Housing Panel (July article) is now reported at 2008 SLT (Sh Ct) 84; Royal Insurance UK Ltd v Amec Construction (Scotland) Ltd (September) at 2008 SLT 825; Wilkie v D B Stuart Ltd (January) at 2008 SLT 917; Mitchell v Hass Tek Services Ltd (July) at 2008 SLT (Sh Ct) 112; McAvoy v Scottish Ministers (September) at 2008 SLT (Sh Ct) 117; Hepburn v Royal Alexandria Hospital (July) at 2008 SCLR 517; Trunature Ltd v Scotnet (1974) Ltd (July) at 2008 SCLR 522; and Cultural and Educational Development Association of Scotland v Glasgow City Council (May) at 2008 SCLR 507.