Scottish Court of Session Decisions

William Sinclair was the outgoing tenant of the farm of Balnafettack, in the parish of Inverness, at Whitsunday 1883, and the incoming tenant was Huntly Fraser. These parties, on 3d May 1883, executed a minute of reference to Donald Paterson, farmer, and James Fraser, civil engineer and surveyor, as joint arbiters (with power to appoint an oversman in case of their differing in opinion), for fixing the value of first year's grass, ploughing of fallow land, fencing, gates, &c., and certain lead water-piping to the house and fields on the farm.

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The arbiters accepted office, and on 26th May, by minute endorsed on the minute of reference, appointed Alexander Winton, farmer, to be oversman, who accepted office. On the same day the arbiters met on the farm, the oversman accompanying them, viewed the subjects of the reference, and took memoranda of their value. They agreed upon the value of the other subjects, but did not fix the value of the lead piping. They had several other meetings and some correspondence, but did not pronounce an award, nor was any joint minute of devolution on the oversman issued by them. On 15th August 1883 Sinclair wrote Huntly Fraser, the incoming tenant, inclosing a note of valuations drawn up by Donald Paterson, amounting in all to £529, 3s. 3 1 4. In this note the lead piping, the length of which was stated at 690 yards, was valued at £77, 12s. 6d., being at the rate of 2s. 3d. per yard. In his letter Sinclair said—“I am sure I need not tell you that I regret to be informed that your man Mr James Fraser would not sign the award, owing, no doubt, to some disagreement amongst themselves, but, as appears to me, forgetting that he is subject to the decision of the oversman. This matter has been kept by them (the valuators) for an unusually lengthened period in hand, and I was obliged to press parties for the award, which I got signed only by Mr Paterson and their oversman Mr Winton.”

In September following Sinclair raised the present action against James Fraser (calling also Huntly Fraser) in the Sheriff Court of Inverness to have James Fraser ordained to join with Donald Paterson “in making and issuing an award” under the minute of reference, fixing the values specified in the prayer of the petition, which were those contained in the note of valuations prepared by Paterson, or otherwise to join with Paterson “in executing a minute of devolution devolving the said submission” on the oversman.

The pursuer averred that the arbiters when they met and viewed the subjects of the submission,“found and fixed their value and prices at the sums specified in the prayer of the petition, at least the said Donald Paterson did so, and understood and believed from the said James Fraser that he agreed therein,” and that after repeated meetings between the arbiters Donald Paterson had declared that he abode by the values already fixed by him; that James Fraser had declared the subjects to be of a different value; and that Paterson had repeatedly required Fraser, in respect of their difference of opinion, to devolve the submission on Winton, the oversman, but that Fraser had refused to do so.

Both defenders appeared. They stated that at the meeting of the arbiters, Paterson and the defender James Fraser, the latter “objected to fixing the value of the lead pipes on the spot, and suggested that information should be got regarding their value from a skilled tradesman that the arbiters might form a just judgment thereon, but the said Donald Paterson refused, and still refuses, to make inquiry or to concur with the said James Fraser in getting the opinion of a skilled tradesman for enabling them to arrive at a fair value for the said lead pipes. The said Donald Paterson on the said 26th day of May 1883 insisted on putting a value on the said lead pipes on the spot, and named a very high price for them, and when the said James Fraser again objected to a price for them being fixed on the spot, the oversman very improperly interfered, and insisted that the price should be fixed at once, and suggested a sum as their value, which sum so named was adopted by the said Donald Paterson. The said James Fraser thereafter sent the said Donald Paterson estimates or offers, received by him from responsible and skilled tradesmen for furnishing and laying new pipes, similar to the said lead pipes, at one-half of the price which the said oversman suggested as the value of the old pipes, and at less than one-third the value which the said Donald Paterson named for them, and the arbiters are in correspondence on the subject.” They further stated that the arbiters had not differed in opinion, and that the subject-matter of the reference was in a tentative and preparatory stage for arriving at a just award when their deliberations were put an end to by the pretended award alleged to have been, and which the defender believed to have been, issued by Paterson and Winton as above referred to in the pursuer's letter to Huntly Fraser; that the defender James Fraser had never agreed to devolve the submission on the oversman.

The pursuer pleaded—“The said James Fraser having accepted of the said submission and proceeded therein, is bound to bring the same to a conclusion, either by agreeing in and issuing the award proposed by his co-referee, or in respect that a difference has arisen between him and his co-referee, by devolving the reference on the oversman already selected by them.”

The defenders pleaded—“(1) The defender James Fraser not being bound to accept the valuation of his co-referee, cannot be ordained to agree to the same, or issue an award in terms thereof. (2) The arbiters not having differed in opinion as to their valuations, the said James Fraser cannot be ordained to devolve the submission upon the oversman. (4) There being no minute of devolution of the submission upon the oversman subscribed by the arbiters, the oversman had no authority to act in the submission and give an award, and by giving his award he has disqualified himself from the office of oversman under the submission. (5) The said Alexander Winton having already given his opinion as to the value of the articles embraced in the minute of reference, he is legally incapacitated from acting as oversman, and the said James Fraser is not bound to devolve the submission upon him.”

The Sheriff-Substitute ( Blair) appointed the arbiters to appear before him personally, and after having examined them, pronounced this interlocutor:—“Finds in point of fact—1st, That the arbiter James Fraser is willing to proceed in the reference, and to make an award, but is desirous that further evidence in the matters embraced in the said reference be produced before making it; and 2d, that the arbiter Donald Paterson declines to proceed in the said reference, and refuses to allow further evidence to be produced in the matter: Finds in point of law—That this declinature and refusal on the part of the arbiter Donald Paterson is such a disagreement or nonagreement as to call the umpire's powers into exercise: Therefore appoints the arbiters, the said James Fraser and Donald Paterson, on or before Wednesday the 12th instant, to execute a

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devolution in favour of the umpire Alexander Winton, farmer, Viewhill, Ardersier, and failing their doing so, ordains the umpire, the said Alexander Winton, to proceed in the submission as shall be just; and in respect the defenders are dissatisfied with this order, and crave leave to appeal, grants leave to appeal, the appeal to be taken within eight days from the date of this interlocutor; and meantime reserves all questions of expenses.

“ Note.—I have adopted the present course of procedure as the most expedient in the circumstances of the case. If carried into effect it will quicken the proceedings under the submission, render the submission itself of some utility, which hitherto it has not been, and cause the beneficial consequences of a decree-arbitral to be sensibly felt. It is no doubt true that an arbiter, after accepting, may be compelled to execute and issue a decree-arbitral— Marshall v. Edinburgh and Glasgow Railway Company, March 26, 1853, 15 D. 603; Thallon v. Wemyss, November 22, 1855, 18 D. 80. But as to what compulsitors can be used for this purpose, ‘the question is one of delicacy and difficulty’ — Bell on Arbitration, 205.”

The defenders appealed to the Sheriff ( Ivory), who pronounced this interlocutor:—“Finds that the action brought by the pursuer was incompetent as regards the first alternative prayer of the petition; and that it was unnecessary as regards the second alternative prayer thereof: Therefore dismisses the action, and decerns: Finds the pursuer liable in expenses, &c.

“ Note.—In the first alternative prayer of the petition the pursuer asks for a decree ordaining the defender James Fraser to join with Donald Paterson, his co-arbiter, in fixing the value of certain subjects on the farm of Balnafettack (21 in number) at the prices mentioned in the said prayer. The pursuer states in the condescendence annexed to the petition that these prices were fixed by the said Donald Paterson, but that James Fraser did not agree to them, and was of opinion that some of the subjects were not of the value set forth in the prayer of the petition. The Sheriff therefore is asked to ordain James Fraser to join with and fix the value of the said subjects at the prices fixed by his co-arbiter, although James Fraser himself was of opinion that some of the subjects were not of that value. Such an application appears to the Sheriff to be incompetent. In the second alternative prayer the pursuer asks for a decree ordaining James Fraser to join with Donald Paterson in executing a minute of devolution devolving the submission on Alexander Winton, the oversman appointed by them in a minute dated 26th May 1883, on the ground that the arbiters had differed in opinion in regard to the value of the said subjects. But if, as the pursuer alleges, the arbiters have so differed in opinion, it appears to the Sheriff that no such minute is required to devolve the submission on the oversman. The arbiters having at the outset appointed Mr Winton as oversm an in the event of their differing in opinion, the difference of opinion between them was of itself sufficient to devolve the submission on the oversman whenever the arbiters differed. The proper course for the pursuer was to have called on the oversman to proceed with the submission, which had in consequence devolved on him. The action therefore, as regards the second alternative prayer of the petition, appears to the Sheriff to have been quite unnecessary, and in the whole circumstances the Sheriff is of opinion that the action ought to be dismissed.”

The pursuer appealed to the Court of Session, and argued—It was clear that there must be some way of compelling a person who had voluntarily accepted of the office of arbiter to go on with the reference. He could not be permitted to bring matters to a deadlock, as here, by refusing either to agree or to devolve. If resort could not be had to the oversman, it might be had to a court of law. The remedy lay in either of the alternative ways prayed for by the pursuer. The Court, having the subject-matter of the submission before it, and deciding which arbiter was in the wrong, could either order him to agree with the other or to join with him in devolving on the oversman. Even if the first alternative of the prayer was incompetent, it was merely superfluous, and did not affect the second, which was clearly competent— Marshall v. The Edinburgh and Glasgow Railway Company, supra cit.;, Bell on Arbitration, pp. 189 and 196; Russell on Arbitration, p. 242. Such an action, being one substantially on contract, was within the Sheriff's common law jurisdiction — Ersk. i. 41. The question had, however, never been the subject of decision.

The defenders replied—The Sheriff's judgment was right—clearly on the first finding, and also on the second, for there was here no refusal on the part of the defender Fraser to perform his function as arbiter, nor was there any such difference between the arbiters as amounted to a deadlock, but merely one on a question of procedure. The defender was in his right in demanding evidence as to the price of the pipes; it was the other arbiter who in refusing to submit to legitimate inquiry was causing the delay — Mackenzie v. Viscount Hill, June 2, 1868, 40 Scot. Jur. 499. The action, which was one to compel the defender James Fraser to perform an act, was incompetent in the Sheriff Court. No precedent could be shown for it. If there was any competent procedure it was by action in the Court of Session containing declaratory conclusions.

At advising—