Scottish Court of Session Decisions

In the execution of a contract between the Local Authority of Carluke and Mr John Scott, contractor, Hamilton, for the execution of certain water-works, disputes arose between the parties which eventually led to this action being brought by Mr Scott for payment of certain sums which he alleged were due to him by the defenders. The contracts, of which there were two, contained the following clause of reference:—“In the event of any dispute or difference arising between the Local Authority and the contractor and his cautioners in relation to the execution, construction, or completion of the work contracted for, or any of them, or any part or portion thereof, or as to the quality or quantity of the work or materials thereof, or as to settling of accounts, or as to any other point or matter whatever in regard to the works, or as to the contract, or to the true intent, meaning, or effect thereof, or of the drawings, specification, and conditions, the same shall be referred to the amicable decision, final sentence, and decreet-arbitral of James Tait, C.E., Wishaw, whose decision shall be final and binding on all parties.”

In answer 3 to the defenders' statement of facts the pursuer averred, with reference to the clause of reference:—“Explained that Mr Tait is disqualified from acting as arbiter in the reference by partial counsel, and by having formed and expressed views adverse to the pursuer on all the points in dispute, both in letters to the pursuer and in an ex parte report obtained from him by the defenders on 7th October 1878, and otherwise. The questions in dispute are truly and substantially questions between the pursuer and the said James Tait. Moreover, in his said report the said James Tait makes entirely unfounded accusations of dishonest practices against the pursuer or his men, and in consequence of this feeling he is incapable of judging fairly or impartially between the parties.”

Mr Tait was the engineer of the works, and on the 7th October 1878 he had made the following report to the Local Authority:—“After opening up a piece of the track at several points, and seeing the disgraceful state in which the pipes had been laid, and the heavy expense it would take to put it right, I gave intimation to Mr Scott and told him I would allow it to stand open for a day or two so that he might see it if he felt so inclined. He, however, paid no attention

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* Decided February 1, 1879.

Page: 436↓

to the matter, and the whole of the fireclay track will require to be opened and the pipes lifted and relaid. So far as we have gone, I find that the drain has not been properly bottomed, and that not one pipe in twenty has been properly jointed. In some places, for a dozen yards at a stretch, the joints are perfectly open, no clay even being put in them. In other places a small piece of rope is put on top of pipe and no cement put in. In other joints cement has been run in, while no rope has been staved into the socket, and the result is that there are a great number of the pipes that have a projection of cement at bottom of pipe, and in several cases the pipes are about filled up. The area of pipe is 12 1 2 square inches, and some of the pipes are so much filled up that only an opening of about 5 square inches is left. I have carefully stored one of such from each of the sections we have opened up, so as to produce it should any difficulty arise when we deduct the cost of redoing the work from the money in our hands belonging to the contractor. It is perfectly evident that the rope-yarn and cement have been kept at hand, and when any person was looking on the joints were done well enough, but immediately on going to any other part where work was going on the pipes were put in any way.”

In consequence of this report the local authority had refused to pay Mr Scott what he alleged was due to him under the contract, and he had thereupon raised this action. He offered no further proof of his allegations against Mr Tait other than the reports referred to above.

The defenders pleaded, inter alia, that the action was excluded by the clause of reference contained in the contracts. The pursuers answered that the arbiter was disqualified from acting in the premises.

The Lord Ordinary ( Curriehill) pronounced this interlocutor:—“The Lord Ordinary having heard parties' procurators, finds that the claims made by the pursuer in this action are embraced by and fall within the clauses of arbitration to James Tait, the defenders' engineer, that the pursuer objects to the arbitration being proceeded with, on the ground, as alleged by him, that James Tait has disqualified himself from acting as arbiter, and that the pursuer states that in support of the alleged disqualification of Mr Tait he has no proof to offer other than the letters and report referred to in his answer to the defenders' statement of facts (art. 3): Finds that the said James Tait has not by said letters or report disqualified himself from acting as arbiter under said clause of arbitration: Therefore supersedes further procedure in hoc statu, in order that the parties may have the pursuer's claims forthwith submitted to arbitration as aforesaid, reserving in the meantime all questions of expenses, and grants leave to reclaim.”

The pursuer reclaimed, and argued—The arbiter by his report, and particularly by the allegation of dishonest practices implied in the last paragraph, had disqualified himself from acting. Had he not been the engineer there could have been no doubt; but it was no part of an engineer's duty to impute motives. The case was within Dickson v. Grant, February 17, 1870, 8 M. 566.

Argued for the defenders—The offices of engineer and arbiter were not imcompatible, and Mr Tait had done nothing as engineer which he was not entitled to do in that capacity— Trowsdale v. Jopp, July 12, 1864, 2 M. 1334; November 15, 1865, 4 M. 31.

At advising—