Scottish Court of Session Decisions

On 20th January 1909 David Mackenzie, plater's helper, 15 Wilkie Place, Leith, brought an action against the Iron Trades Employers' Insurance Association, Limited, 105 West George Street, Glasgow, for payment of £500 damages.

The defenders insured, amongst others, the firms of Hawthorns Limited, Menzies & Company, Limited, and Cran & Company, Limited, all of Leith. In March 1908 the pursuer, while at work on a sub-contract from Hawthorns Limited, had sustained injuries to his right hand, for which he had claimed and received compensation from Hawthorns Limited under the Workmen's Compensation Act 1906.

The pursuer averred—“(Cond. 3) The defenders are in the habit of issuing regularly from time to time, to parties insured with them as aforesaid, lists of workmen whom they insist shall not be employed by said parties. The workmen whose names are inserted by defenders in said lists are thereby represented to be persons who are unfit or ought not to be employed. The defenders issued their said lists to the said Hawthorns Limited, Menzies & Company, Limited, and Cran & Company, and to the whole other parties insured with defenders in Leith and elsewhere throughout the United Kingdom. The defenders illegally, unwarrantably, and without any justification or reason therefor, included pursuer's name in said lists of unemployable persons issued by them as aforesaid, and thereby wrongfully, illegally, and maliciously brought about the pursuer's dismissal and non — employment on each of the occasions hereinafter condescended on. (Cond. 4) On 17th June 1908 the pursuer obtained work from one John M'Swan, plater, Leith, who had got a subcontract with said Hawthorns Limited for putting casing on a steam-drifter called ‘The Morning Star.’ The said John M'Swan, after the pursuer worked for him one day, was ordered by Hawthorns Limited, on the morning of 19th June, to dismiss the pursuer. M'Swan dismissed the pursuer accordingly. This order was given by Hawthorns Limited in consequence of the pursuer's name being included in said lists issued by the defenders as aforesaid, and of instructions given by the defenders to them to see that no person whose name was in said list was employed by them or by any sub contractor with them. But for his name being included in said lists the said John M'Swan would have continued to employ the pursuer on said job, which lasted for four weeks.… The defenders are called on to state the reasons for the pursuer's dismissal connected with the management of Hawthorns Limited. (Cond. 5) In or about the month of July 1908 the pursuer was engaged by one John Hyndman, painter and contractor, Leith, to work at Granton on a sub-contract which the latter had from Hawthorns Limited. The pursuer, however, was not allowed to start on the said job, because intimation had been made by Hawthorns Limited to the said John Hyndman in the interval that the pursuer's name appeared on the said lists as aforesaid, and orders had been given in consequence to him that he was to cancel the employment of the pursuer. These orders were given by Hawthorns Limited in consequence of orders sent to them by the defenders to see that no persons whose name was on said lists was employed by them or by any sub contractor with them. But for the defenders' actings the pursuer would have received work from the said John Hyndman, and would have had continuous employment from him during the subsistence of the job in question. (Cond. 6) Shortly after the incident above referred to, the pursuer applied for a job to Menzies & Company, Limited, but because his name appeared in defenders' said lists, and in consequence of orders issued by defenders to Menzies & Company, similar to the orders above condescended on, he was refused employment. The pursuer believes and avers that but for this fact he would have got employment from Menzies & Company, Limited, on the occasion in question. (Cond. 7) On 23rd November 1908 the pursuer received work from one John Laird, plater, Leith, who had a sub-contract' rom said Cran & Company, Limited, and was engaged working at said job till about four o'clock in the afternoon of the same day, when the said John Laird was ordered by Cran & Company, Limited, to dismiss the pursuer, because, as they informed him, and as was the fact, his name appeared in said list of unemployables issued by the defenders to Cran & Company, Limited, with orders similar to the orders above condescended on. Mr Laird thereupon dismissed pursuer. Said job is still unfinished, and is likely to occupy at least five months, during which time, but for the defenders having included the pursuer's name in said list, his employment would have continued. The pursuer was and is well known to the trade to be a thoroughly efficient workman in all branches of the plating trade, and prior to the inclusion of his name in the said list of unemployables issued by the defenders as aforesaid he had no difficulty in getting employment in Leith or elsewhere as a plater's assistant. (Cond. 8) The defenders enforce the dismissal or non-employment of parties whose names appear in their said lists by representing they are unfit to be employed, and by requiring the instant dismissal of any of them who have been employed. In the event of non-compliance with this latter order, the defenders refuse liability for accidents occurring to them during such employment, after said lists containing their names have been issued by the defenders as aforesaid, and it was by means of said lists, accompanied by said orders and threats, that the defenders wrongfully and illegally coerced the firms in question to procure the non-employment of the pursuer and the breaches of contracts of employment with him when he was employed. In acting in the manner above condescended on towards the pursuer, the said firms were acting as members of the defenders' association and upon the instructions of and on behalf of said association. The pursuer has suffered great worry and finaucial

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loss, and the sum sued for by him in name of damages is, under the circumstances, reasonable.…”

He pleaded—“(1) The defenders having wrongfully, illegally, and unwarrantably included pursuer's name in the list of persons not to be employed, issued by them, and having thereby brought about the pursuer's non-employment and dismissal, all as condescended on, are liable to him in damages. (2) The defenders having wrongfully and illegally coerced the firms condescended upon not to employ the pursuer, or to dismiss him when employed, all as condescended on, they are liable to him in reparation. (3) The defenders having wrongfully continued to prevent the pursuer from obtaining employment as condescended on, are liable in reparation.”

The defenders pleaded, inter alia, that the pursuer's averments were irrelevant.

On 22nd May 1909 the Lord Ordinary ( Mackenzie) dismissed the action as irrelevant.

Opinion.—“The pursuer is a workman, and the defenders are an insurance company who insure firms against claims under the Workmen's Compensation Act.

The pursuer's complaint against the defenders is that they included his name in a list which they circulated among the firms insured with them of workmen whom they insisted should not be employed, and that the workmen whose names appeared on the list were represented to be persons who were unfit or ought not to be employed. The pursuer then avers—‘The defenders illegally, unwarrantably, and without any justification or reason therefor, included pursuer's name in said lists of unemployable persons issued by them as aforesaid, and thereby wrongfully, illegally, and maliciously brought about the pursuer's dismissal and non-employment on each of’ four occasions which are condescended on.

In none of the cases is it alleged on record that there was any breach of contract for the pursuer on the part of his employer. The instance in cond. 5 comes nearest to breach of contract, but the terms of the contract are not set out, and it may be that the right of the sub-contractor to engage the pursuer was subject to the implied condition that Hawthorns Limited were to consent. The four occasions referred to on record are therefore cases in which the employment was legally terminated by the employer or employment was refused.

The pursuer says the defenders have done him an actionable wrong; that it is for them to justify what they did; and if they fail to do so he is entitled to damages. He asks that an issue should be adjusted and the case sent to a jury.

In my opinion the pursuer's argument halts at the first step. I do not find any averment that the firms whose names are mentioned were bound to comply with the intimation which it is alleged was made by the circulation of the list. There is no doubt in cond. 8 an averment that the firms in question were acting as members of the defenders' association and upon the instructions of and on behalf of the association. This, however, is not consistent with the earlier articles of the condescendence in which the firms in question are placed at arm's length with the defenders. If the firms were under no obligation to comply with the intimation from the defenders, the termination of the pursuer's employment was not a necessary consequence of anything the defenders did. In whatever language the pursuer's averments may be couched the situation is obvious. The defenders ensure the firm's risks at a certain rate. They intimate by the circulation of these lists that there are certain risks they will not undertake for the premiums charged. (This must be the meaning of it, because of course any workman could be insured if the premium were only high enough.) The employer then is put to his election. He may, if he likes to take the risk himself, continue the workman in his employment though his name is on the insurer's list. In this event he is his own insurer. Or if he does not choose to take the risk he may terminate the employment.

The fallacy at the root of the pursuer's case lies in the contention that any interference with what was termed a man's right to work constitutes an actionable wrong. This is not the law. If it were, it is difficult to see how there could be free competition in business. There is no action able wrong unless the interference is unjustifiable.

The pursuer maintained that it is for the defenders to justify what they have done. The conclusive answer to this is contained in Lord Herschell's opinion in Allen v. Flood, 1898, A.C. 1, at p. 139—‘A man cannot be called upon to justify either act or word merely because it interferes with another's trade or calling, any more than he is bound to justify or excuse his act or word under any other circumstances, unless it be shown to be in its nature wrongful, and thus to require justification.’

How can it be said that it is wrongful interference for an insurance company to say they will not undertake a particular risk at a particular figure? And how can the Court inquire into and decide the question whether the insurance company were justified in what they did, which would involve fixing the rates at which the company are to transact their business? The pursuer has the right to earn his own living in his own way, and the correlative of this is the general duty of everyone not to prevent the free exercise of this liberty, subject always to this important exception, which the pursuer's argument in the present case overlooks, that anyone may interfere in so far as his own liberty of action may justify him in doing so. This is pointed out by Lord Lindley in Quinn v. Leathern, 1901 AC 495 at p. 534, which is one of the cases the pursuer founds on.

It is not for the defenders to allege and prove justification. The pursuer must relevantly aver that the defenders' actings

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were unjustifiable. This in my opinion he has failed to do. The use of the words in cond. 3, ‘illegally, unwarrantably, and without any justification,’ is not enough. It would be necessary to set forth facts and circumstances to support this statement.

Reference was made to the averment in cond. 2 that the pursuer had previously made a claim for compensation and been paid £4, 1s. for an injury which had rendered him unfit for work for about six weeks. It was suggested in argument that the placing of the pursuer's name on the list was in some way connected with his having made a claim for compensation, but there is nothing about this on record.

I have said nothing as to what the result would have been if the defenders had employed illegal means to procure the termination of the pursuer's employment. This, as was pointed out by Lord Watson in Allen v. Flood at p. 96, would make the case entirely different.

In cond. 8 the pursuer says the defenders used threats and coerced the firms. They likened this case to the one figured by Romer, L. J., in Giblan v. National Amalgamated Labourers' Union, 1903, 2 K.B. 600, of an individual interfering with a man's employment by threats or special influence with the design to carry out some spite or compel payment of a debt. I can find nothing on record to justify the use of the terms threats or coercion, nor is there anything averred which would make the dictum above referred to applicable.

In the view I take it does not appear to me necessary to go further into the authorities which were fully discussed in argument. I am of opinion that the pursuer's averments are irrelevant, and that the action should be dismissed with expenses.”

The pursuer reclaimed, and argued—The pursuer's averments were sufficiently relevant to entitle him to inquiry. He was entitled to know what was contained in the lists issued by the defenders. He had no means of ascertaining what was contained in these lists, as the defenders had refused to inform him. If, as he averred, the issue of these lists resulted in his ceasing to be employed, he was entitled to know whether or not the defenders' actings were justifiable, for if they were not he was clearly entitled to damages. It was not for the pursuer to aver nonjustification, but for the defenders to justify their interference. Esto that the defenders were entitled to demand a higher rate of insurance, they were not entitled to injure the plaintiff by any illegal act— Mogul Steamship Company v. M'Gregor, Grow, & Company, [1892] AC 25, per Lord Watson at p. 42; Allen v. Flood, [1898] AC 1; Quinn v. Leatham, [1901] AC 495, per Lord Macnaghten at p. 510; Giblan v. National Amalgamated Labourers' Union of Great Britain and Ireland, [1903] 2 KB 600, per Romer, L. J., at 620; Conway v. Wade, [1909] 25 T.L.R. 779, per Loreburn, L.C., at p. 781. Esto that the modus of the injury had not been specified, the pursuer had no means of doing so, and he had made his averments as specific as possible. Reference was also made to Macintosh v. Dun, [1908] AC 390, and Keith v. Lauder, December 23, 1905, 8 F. 356, 43 S.L.R. 230.

Argued for respondent—The Lord Ordinary was right in holding the pursuer's averments irrelevant. No contractual relation existed between the pursuer and his employers, and therefore the pursuer was unable to found on any conduct inducing breach of contract. To make his action relevant he must aver either (1) something inducing breach of contract, or (2) the use of illegal means to induce another to commit a legal act to the pursuer's detriment— Allen v. Flood ( cit. supra), per Lord Watson at p. 96, and Lord Herschell at pp. 139–40. Neither was averred here. There was no averment of conspiracy, or threats, or violence, or the use of illegal means, as in Quinn v. Leathem, Conway v. Wade, and the other cases cited by the pursuer. The modus of the alleged illegality was not specified, and that would have been easy had the facts supported it. In Giblan ( cit. supra) there was an actionable wrong in initio., e.g., unjustifiable combination. The respondents did nothing illegal in furnishing the lists in question, unless the statements made therein were unjustifiable, and that was not averred. The pursuers had failed to show any nexus between his ceasing to be employed and the act complained of. In the cases which he cited there was such a nexus between the act complained of and the inducing cause. Assuming, however, that the pursuer was entitled to inquiry, then proof and not issues should be ordered.

At advising—