Attempt to challenge arbitration ruling misconceived

In Politakis v Spencely and James Scott Ltd [2016] SC EDIN 27, a long-running arbitration was finally brought to an end. The pursuer was a director and shareholder in a company called Apollo Engineering Ltd, which had contracted in 1990 to undertake an engineering contract for a jetty in Coalport. Court of Session proceedings were commenced then sisted in 1993, after which Apollo went into liquidation. Arbitration proceedings were commenced in 2002 but then required to be recommenced in 2005. The arbiter and defender issued a draft award in 2007 which substantially dismissed Apollo’s claims and awarded expenses against it.

Politakis, despite having been earlier refused permission to substitute Apollo in the Court of Session proceedings, raised fresh proceedings in the sheriff court in an attempt to overturn the arbiter’s findings.

The attempt was refused on all of the grounds advanced by the defender and party minuter, James Scott Ltd, as follows: (1) the pursuer had no title to sue in the place of Apollo; (2) the action was incompetent and misconceived in that any such claim could only proceed by way of stated case in terms of s 3 of the Administration of Justice (Scotland) Act 1972; (3) the action was out of time; and (4) the claims themselves were wholly lacking in specification. Decree of absolvitor was granted and expenses with sanction for senior and junior counsel were awarded against the pursuer.

The decision is a salutary lesson to party litigants not to raise claims without first properly investigating the legal basis for doing so and can be read here.