Scottish Court of Session Decisions

James Campbell, tenant of part of the lands of Balbrogie, concurred with other tenants in the vicinity, and with the proprietors of the lands, in the propriety of adopting joint measures for erecting an embankment along the course of the river Isla, to protect the ground from inundation. They bound themselves by a deed of submission, in April and May 1831, to refer to the decision of William Blackadder, surveyor, as arbiter, what should be the line, extent, and dimensions of the embankment, with power, after fixing these points, to advertise for estimates, and to enter into a contract with the party whose offer should be approved by a majority of the parties submitters at a meeting to be called for that end. There was a general clause empowering the arbiter “to fix and determine, under the declarations and exceptions before specified, every thing else in regard to the premises which the said arbiter may deem proper and necessary, and incumbent on all, or either of the parties.”

Blackadder accepted of the submission, fixed the specifications of the embankment, and advertised for contractors. A meeting of the submitters approved of the offer of John M'Farlane, as contractor, with Robert M'Lachlane as his cautioner. A contract was made between the said parties submitters on the one hand, and M'Farlane and M'Lachlane on the other, for the execution of the work. In the contract, which detailed certain specifications of the embankment, power was given to Blackadder “to add to, or diminish from the work, as circumstances may show to be necessary;” and it was farther stipulated that the works “were to be carried forward and finished in a proper and workmanlike manner, and that to the entire satisfaction of William Blackadder, whose award is to be final and binding on the parties, and subject to no review or modification in any Court whatever.” M'Lachlane, as cautioner, bound himself that M'Farlane should erect and uphold the embankment “according to the specifications and conditions before narrated, and that to the satisfaction of the said William Blackadder.”

In October, 1881 (which was about two months after the embankment was to have been duly finished), a flood in the Isla broke through a part of it, and overflowed some of the grounds of James Campbell. In March thereafter, Campbell raised an action of damages against M'Farlane, M'Lachlane,and Blackadder, narrating, inter alia, the submission to Black-adder, and his acceptance thereof, and the contract with M'Farlane and M'Lachlane; that Blackadder had been named inspector, and was bound to sec the work finished, in terms of the contract and specifications; that MacFarlaue did not execute the work according to the specifications of the contract, or within the time fixed by it, and was guilty of a breach of the contract, to the great injury of the pursuer, as it was the occasion of the river overflowing his ground and damaging his crops; that both M'Farlane and Blackadder, notwithstanding notice of the overflow, made no attempt, for a whole week, to remove the water; “that the said deviations from the contract and specifications, by which the pursuer has suffered damage as aforesaid, were either fraudulently connived at by the said William Blackadder, whose duty it was to superintend the execution of the work, or they were permitted, through the gross negligence of the said William Blackadder in not fulfilling his duty as inspector; and, in either case, he is jointly and severally liable, along with the contractor, on account of such deviations; that as the loss and damage thus arising to the pursuer was occasioned by the said John M'Farlane's breach of contract, in not finishing the said embankment within the specified time, and conform to the specifications and conditions contained in his contract before narrated, as well as through the culpable fraud, negligence, or carelessness of the said William Blackadder, who took on himself the office of inspector of that work, and whose duty it was to see the conditions of said contract fully implemented, the said John M'Farlane, and the said Robert MacLachlan, as his cautioner, and William Blackadder, are therefore jointly and severally liable to the pursuer in the loss and damage sustained by him by the overflowing and breaking of said embankment, and the inundation of his growing crops.”

The defenders pleaded, as a preliminary defence, that the damages were laid on a ground of action which necessarily fell within the submission to Blackadder as arbiter. He had received full power to decide on the mode in which the embankment should be executed, and he had acted according to the best of his judgment. There was no allegation that he had acted corruptly, so that no action could lie against him; and as there was no allegation that the work was not executed to his satisfaction, no claim could lie against the contractor. At all events, the action was prema turely raised, until any claim which the pursuer might have against the contractor, M'Farlane, had been made and disposed of by Blackadder in the submission.

Issues were prepared and approved of by the Lord Ordinary, to try—

1. Whether M'Farlane undertook to make the embankment conform to a certain contract and specification, and wrongfully failed to fulfil his agreement, to the injury of the pursuer?

2. Whether M'Lachlane, as cautioner, was liable for £150, or part thereof, as the damage occasioned by M'Farlane's failure?

3. Whether Blackadder was inspector of the work, and “by negligence, or fraudulent connivance with the said John M'Farlane, wrongfully failed in the execution of his duty, as inspector of the said work, to the loss, injury, and damage of the pursuer?”

There was an alternative issue, Whether the pursuer had himself directed the deviations complained of, or had homologated them?

Another issue was proposed by the Issue Clerk, Whether Blackadder was arbiter, and acted corruptly? but the Lord Ordinary ordered that issue to be struck out.

After the Lord Ordinary had approved of the other issues, the defenders gave notice that the Court would be moved “to direct that, before farther procedure, the preliminary defence, founded on the subsisting reference to Mr Blackadder shall be discussed and disposed of; in respect that the reference in the contract to, and award of, Mr Blackadder, exclude all other enquiry or trial of the sufficiency of the work in question, until such reference and award shall be reduced in a regular action for that purpose, on relevant grounds; or, otherwise, to sist process, &c.”

In support of the motion the defenders referred to Robertson, January 22, 1835. ¹