Scottish Court of Session Decisions

The pursuer of this action was Mr Charles Tough, a contractor, residing in Govan, and the defenders were the Dumbarton Water Works Commissioners, and the action concluded for payment of certain sums which the pursuer alleged to be due to him by the defenders, and also for damages on account of alleged breach of contract. In April 1870 the pursuer entered into a contract with the defenders, by which he undertook to form an embankment and other works for a reservoir on the Overtoun Burn on the lands of Auchentorlie and Strathleven. a short distance above the Black Linn, at a level of about 1000 feet above the sea, and about four miles north from the town of Dumbarton; also to form a fire-clay pipe conduit from the reservoir about 1300 yards long, and to construct an additional filter on the lands of Garshake, close to and of the same dimensions as the filter belonging to the commissioners, all according to plans and specifications referred to in said contract. In October 1870 the pursuer entered into a second contract with the defenders, by which he undertook to remove the peat from the bottom of the reservoir. The first contract—that of April 1871—also contained a general reference of all doubts, disputes, or differences that might arise in connection with the contract, to the amicable decision, final sentence, and decree-arbitral of James Morris Gale, civil-engineer, Glasgow, whom failing, by death, non-acceptance, resignation, or otherwise, of any arbiter to be named by the Sheriff of Dumbartonshire, upon the application of either party, as sole arbiter in the premises, whose decision, valuation, and awards should be final and binding on all the parties. And it was thereby declared that although the said James Morris Gale might continue and remain engineer of the commissioners. such connection should not disqualify him from acting as arbiter in the premises, and his de-cion should be as unchallengeable as if he were wholly unconnected with the commissioners or the said works. The pursuer proceeded with the work specified in these contracts, and his averments in reference and hereto, upon which he founded his action, were as follows. He averred that he had executed under the first contract work to the extent of £2277, 2s., on account of which he had been paid £2124, 14s. 9d., leaving a balance due to him of £152, 7s. 3d. Under the second contract the pursuer averred that he had excavated the whole peat mentioned in the contract, and, at the defender's request, 18,771 cubic yards in addition. The amount which he claimed as still due to him for these operations was £742, 1s. The pursuer next averred that, to expedite the removal of the peat, Mr Gale, the engineer of the defenders, in or about the month of June 1871. acting with the authority of the defenders, ordered the pursuer to

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put all his men, wherever working, on the embankment, and wheel out a part of the peat, and lay it down on the ground from which the clay had been removed for the formation of the embankment, and stated that the pursuer would be paid therefor. The expense incurred in carrying out these instructions was £79, 16s.

The whole amount which the pursuer thus claimed as due to him by the defenders for work done was £974,4s. 3d., and the summons contained a conclusion for that amount with interest. Besides claims for work done, the pursuer brought two claims for damages against the defenders. In the first place, he averred that in or about July or August 1871, the defenders, without any reason, and without any legal authority whatever, seized the pursuer's plant, appropriated it to their own purposes, and retained possession of it; and at said date they also took the contracts out of his hands. On accountof these alleged proceedings, the pursuer claimed £500 damages. In the second place, the pursuer averred that “it was part of the contract between the pursuer and the said commissioners that the former should execute the work within fifteen months from the date of the acceptance of his offer, and he entered into the contract on the faith of his being able to get immediate access to the ground. According to the fair meaning of the contract the pursuer was entitled to immediate access to the ground, but the defenders wrongfully failed till April 1870, a period of upwards of seven months from said acceptance, to give the pursuer access to the ground, other than that on which the filter had to be constructed. The pursuer was thereby prevented from taking up the work simultaneously, and from getting the work done in the winter months necessary to prepare the ground for the embankment being completed in summer. In consequence of the delay, the work was thrown into winter which should have been done in summer, when it could have been done at much less cost. In this case, also, the pursuer claimed £500 damages. In defence; the Water Works Commissioners stated that the pursuer failed to carry on the works during the summer of 1870 so as to ensure their being completed in time, although he had the whole summer to execute the works, and that he was continually in money difficulties, and made frequent applications for advances beyond the provisions of the contract. That in the early part of June 1871 it became apparent that the means which the pursuer was taking for disposing of the peat were insufficient, and Mr Gale, the defenders' engineer, made them aware of this, and stated that at the rate at which the pursuer was proceeding there was no prospect of the reservoir being in a state to be used even to a partial extent during the then approaching winter, and that it would be necessary to take the work out of the pursuer's hands, and to make new contracts for its completion. In consequence of this communication, the commissioners arranged a meeting with the pursuer, which took place in Glasgow on 1st July 1871, and the result of that meeting was that on 4th July 1871 the pursuer addressed a letter to the commissioners voluntarily renouncing both contracts. This letter was considered at a meeting of the commissioners held on 7th July 1871, when they agreed to accept of said renunciation, reserving the rights of both parties, and under an express denial of an allegation made by the pursuer, that he was able and willing to proceed with the contracts in terms thereof, or that he had hitherto complied with the terms of the contract.

The defenders pleaded, inter alia, that the action was excluded by the clause of reference in the said contract, and ought therefore to be dismissed.

The Lord Ordinary pronounced the following interlocutor:—

“3 d December 1872.—The Lord Ordinary, having heard counsel on the motion of the defenders to have the action dismissed in so far as it relates to the sums sued for, other than those applicable to the contract for excavation of peat, in respect that Mr Gale is ready to accept the reference made to him under the contract, No. 10 of process, finds that the action is excluded by the clause of reference in so far as regards the £152, 7s. 3d. claimed as balance due under the original contract price of the works, and 2d, the two sums, each of £500, claimed in name of damages under the summons; allows the parties a proof of their averments applicable to the removal of the peat from the reservoir, and to each a conjunct probation; appoints the proof to be taken before the Lord Ordinary on Thursday, the 9th day of January 1873, at half-past ten o'clock; and grants diligence for citing witnesses and havers: Quoad ultra sists process until the result of the question raised in this action relative to the removal of the peat.”

The pursuer reclaimed.

It was argued for him, that in regard to the claims for money due to the pursuer by the defenders, that was clearly not within the scope of the arbiter, for it was simply a claim for a debt due. If questions arose within the province of the arbiter the Court would remit to him, but to deal with a money claim was not within his province.

As to the claims under the second contract, that could not be a matter for the arbiter, as there was no clause of reference in that contract. As regarded the claims for damages, that was obviously a matter for the Court, as there was no power to the arbiter to decide any such question.

It was argued for the defenders that the subject matter of the action was within the clause of reference, as all matters connected with the contract were there referred to the arbiter. The claim of the pursuer for £152 for work done under the contract was not due under the contracts at all, if, as the defenders alleged, the pursuer was in breach of the contract, and whether or not he was so was a matter for the arbiter.

As to the claims for damages they were also within the province of the arbiter, for the clause of reference was very wide and included any thing done in reference to the contract.

At advising—