Scottish Court of Session Decisions

In November 1992, the pursuer purchased a boat the "Carbeth Belle" from one, Kenneth Sinclair. He had viewed that boat at, and after purchase, removed it from, the second defender's boat yard in Glasgow. Mr Sinclair wanted to be paid in cash. The boat did not in fact belong to Mr Sinclair but to a finance company, Conister Trust. It was subsequently repossessed by that company. Mr Sinclair shortly thereafter went bankrupt and the pursuer was accordingly unable to recover from him his losses in connection with the repossession. At the end of 1997, the pursuer raised the present action against Mr  Stanley Prosser and the company H. Prosser & Sons Ltd. He concluded for damages jointly and severally. By the time the action was raised, the second defenders were in liquidation, that event having occurred in February 1996. However, that matter does not feature at all in the pursuer's pleadings and from the Closed Record, it would appear that he is still seeking a joint and several decree without convening the liquidator.

The ground of fault pled is as follows:

His second plea-in-law reads:

In these circumstances, it was not surprising that enquiry was by way of a proof before answer between the pursuer and first defender with the first defender's plea to the relevancy standing. The relevancy of the action is open to serious question but, in the event, for the reasons undernoted, I have come to the view that the pursuer has established none of the facts necessary to establish the basis of his case pled in Condescendence 5.

It should be said at the outset that my impression at the proof of the main protagonists, the pursuer, his father, Mr Sinclair and Mr Prosser, was that there was considerable doubt about the reliability of any of them. Accordingly, I had the notes of evidence extended. These did nothing to dispel my unfavourable impression of the pursuer who was, I find, telling deliberate untruths in some aspects of his evidence. Mr Prosser's evidence remained unsatisfactory but, I consider, through defect in recollection of events in 1992 and earlier rather than an attempt to deceive the court.

The pursuer's evidence began by narrating visits to the second defender's yard, on specific dates, on which occasions, he asserted on averment and in evidence, that he had various conversations with Mr Prosser. The matter of the dates was much canvassed at the proof. The 18, 25 October and 1 November were Sundays. I hold that no conversation took place between the pursuer or his father and the first defender on any Sunday. That was the first defender's evidence and it was supported by the second defender's ex-employee, Douglas Martis. The first defender did not as a matter of routine attend the premises on a Sunday and I hold did not do so on 18,25 October or 1 November 1992. At the proof the pursuer purported in his evidence to have established these dates by reference to a diary. The diary was not initially produced. He said that it was, however, outside in his car. It was subsequently produced and the pursuer cross-examined upon it. He said (Notes p.13) that he would have the dates in his diary and at (13E) Q. "So again we will find in your diary the precise date of the visits? - A. no question". Again at 23D, Q. "again will we be able to get the precise date from your diary?" - A. "Yes, yes" At p.34 the pursuer, when professing to work out dates from his diary, referred to a piece of paper. This was said to be in note form and he was about to give evidence from that note when stopped by the court after objection by defender's counsel. When asked by his counsel were these notes made at the time he replied "I had no reason to make notes at the time". In cross-examination after prevaricating at pages 107 and 108, he was asked "Did you note any of the dates you visited the yard in October?" He again sought to consult his diary. When confronted with his diary, he agreed that there was nothing in it (apart from Mr Sinclair's telephone number against the date 1 November) which had any relevance to the present dispute. The pursuer ultimately admitted that all the dates he spoke to in evidence were reconstructions. From what source they were reconstructed was not satisfactorily established.

The pursuer averred that the first defender informed him that the vessel was being sold privately by Kenneth Sinclair, who was a personal friend (of the first defender). Both the first defender and Mr Sinclair denied that they were personal friends and I accept that denial. The pursuer averred and said in evidence that the first defender gave him Mr Sinclair's telephone number. The evidence about this matter was somewhat confused. The first defender denied it. The telephone number in the said diary was not one known to the first defender. Mr Sinclair said that he thought that the pursuer had contacted him after he had been informed by the first defender that the pursuer would do so. The pursuer's averments continued to narrate that the first defender told him that Mr Sinclair had bought the boat from him. Key averments of what the first defender was alleged to have said are quoted below. "He added that there had been no finance on the deal". He told the pursuer that Mr Sinclair met the purchase price of the boat by exchanging a car and a boat "He further stated that Mr Sinclair had got money back on the deal". "He stated that as Mr Sinclair was a friend of his no brokerage fee was payable".

Whatever the source of the pursuer's information for these averments, they were accurate in some respects. Mr Sinclair had bought the boat originally from Mr Prosser's firm. The second defenders had not arranged finance. Mr Sinclair had met the purchase price of the boat by exchanging a car and another boat and Mr Sinclair got money back on the deal to the extent of £5,000. I find that on request, the £5,000 was sent to Conister Trust but that the first defender had no information about whether or not the vessel was the subject of any hire purchase agreement or had been given in security for any other loan or any such matter. The second defenders in the course of their business did arrange finance for the purchase of boats with two companies with whom they had special arrangements. They did not arrange any finance in connection with the purchase by Mr Sinclair. Only the second defender issued cheques. Mr Sinclair gave some evidence to the effect that he had signed some documents at the premises of the second defenders and nowhere else. This was inaccurate since the witness to the critical document (14/13) of process, gave evidence, stating that she had signed it, that she had never been to the second defender's premises and that she was in fact an employee of Kenneth Sinclair at the material time. Mr Sinclair denied knowing the identity of the witness to the document (14/13) but I did not believe him. Mr Sinclair did, however, either directly inform the pursuer that there was no outstanding finance or charge on the boat and concealed the true facts from him. He thought that a third party purchaser for value would be able to retain the boat, or so he asserted later in a document (14/7) dated 5 November 1993.

In connection with the averments about brokerage payable to the second defenders on a sale, the pursuer deponed that he was certain that the first defender said (19B) "If you buy the boat you owe me a bottle of vodka, and as he is a friend he wont be charged a brokerage fee". At p.184 of the notes when it was put to the pursuer that the first defender had no reason to be interested in discussing whether there was finance on the boat or not, the reply was "Of course he did he was anticipating a sale". At p.185 he further elaborated by saying that it was a private sale. At 185B the question was put "Q. and the company was going to get commission on it was it? - A. Yes; Q. I see. Did he tell you that? A. yes; Q. He told you the company was going to get commission? - A. Yes, he told me that categorically without any question". The pursuer firmed up on the matter by saying that he thought the company was selling the boat on behalf of Mr Sinclair and that Mr Prosser was trying to push the sale through so that the company could get its commission. Similar speculation was advanced by Mr Brown senior.

I found what was said in that passage of evidence not only highly unlikely but barely comprehensible in the light of the averments and the pursuer's previous evidence. There was no support whatsoever for a brokerage fee being payable at the time of sale in Mr Sinclair's evidence. The pursuer's account did not consist with the proved and admitted facts of his having arranged a bargain with Mr Sinclair personally outwith the presence of the first defender involving the part exchange of a vehicle. By that stage in his evidence, the pursuer having been caught out about the matter of his diary was intent, if he could, on trying to establish that the true sale was between the defenders and him in order to attempt to fasten some responsibility on the first defender for the events which occurred.

I find that the pursuer has wholly failed to establish any of the essential matters upon which Condescendence 5 relies. The other evidence in the case was peripheral to that issue and was only useful in regard to the matter of credibility.

The first defender was challenged by the pursuer's counsel as incredible and unreliable. Since I have found the pursuer to be both incredible and unreliable whether or not the first defender was credible may not particularly matter. The first defender was challenged about the circumstances in which the Carbeth Belle came into the boatyard. the assertion was that they had agreed to sell it for Mr Sinclair. Advertisements were produced which might indicate that such a vessel had been for sale. There was a similar vessel about which it was said "owner desperate to sell". There was also put to the first defender a witness statement (14/11) (erroneously described in the Inventory of Productions as draft affidavit) signed by the first defender which was prepared in connection with proceedings in England by Conister Trust against inter alios the first defender. There was nothing in that document which materially assisted the pursuer on essential matters, although there was a curious confusion about the circumstances surrounding an invoice 15/81, its date and payment, the departure of the 'Carbeth Bell' from the second defender's yard and the presence of the first defender in the yard at that time. Nothing in the first defender's evidence, however, amounts to any admission of or support for the pursuer's contentions.

The other main protagonist, Sinclair, had been manifestly dishonest in relation to the sale of the vessel to the pursuer and I would not place any reliance on his evidence on any matter on which he contradicted the first defender. It was Sinclair who caused the pursuer's losses on the facts before the Court.

The question therefore of whether the pursuer had pled a relevant case is superseded. However, Mr Glennie for the defender argued persuasively that there was no duty owed in the circumstances, in any event. The first defender even if he had made the observations averred and such of them as were spoken to in evidence, had no duty to give information and so no question of requiring accuracy could arise. The first defender was an employee of the second defenders and showed boats on behalf of them. The company could have had an interest in promoting the sale of the vessel but that would not transfer to a director or employee of the company the duty to provide information, accurate or otherwise, about previous hire purchase or loan arrangements. The first defender was clearly acting on behalf of the company if there were any dealings for commissions to be obtained and it could not be said that there was any reliance by the pursuer on any personal representation of the first defender. The test is one of assumption of responsibility (Henderson v Merrett Syndicates Ltd [1995] 2 AC 145 per Lord Goff at 178-181 and Williams v Natural Life Health Foods Ltd [1998] 1 WLR 830) and there was no evidence in this case to meet the criteria set out in the cases. Mr Glennie's argument did depend upon facts rather than upon legal principle alone divorced from facts and I have found the facts in his favour.

It is necessary to say something about the losses claimed. The pursuer claimed to have lost the boat for which he paid £30,000 and money which he had spent transporting and refurbishing it. He also somewhat disingenuously, claimed costs for removing it brevi manu from Jalsea Marine in England whence it had been taken when repossessed by the finance company. The pursuer's somewhat cavalier approach to evidence can also be seen in various documents he produced which, at first sight, might appear to have been receipts for various matters. Only one was in fact a receipt. The others were admitted to be documents recently written by persons at the dictation of the pursuer who asked them to write what he said he had paid them. Payments were made it was asserted, mostly in cash, without receipts despite many of the firms in question being VAT registered. Apart from the pursuer's statement in evidence about what he paid, the documents added nothing to his evidence. I was unable to accept his evidence as above noted and accordingly would have found that he had failed to establish what he had paid out in relation to the boat and its travels. In fact he repurchased the boat later from the finance company at a price of £12,000. The position is now that he has his boat but has paid an additional £12,000 for it. One of the worst examples of the unsatisfactory nature of the evidence of the pursuer and his father were certain documents bearing to be records of payments by the pursuer to his father in relation to equipment for the vessel. Part at least of these so called accounts was not paid at all, that part in relation to alleged work done by the pursuer's father. Another extraordinary claim was in relation to propellers. A document was produced which related to propellers which were not propellers suitable for the vessel in question. The receipt itself bore to be for a vessel of another name which either still belonged or had belonged to the pursuer. The specified propellers were appropriate for that vessel. The pursuer's unsatisfactory explanation of all that was that there had been a mistake in narrating three bladed instead of four bladed propellers. All these matters compounded the unfavourable impression I had formed of the pursuer and his evidence.

Whatever the nature of the transaction between Mr Sinclair and the pursuer and the underlying motivations of the parties to it was, the pursuer was content it appeared to pay cash for an asset of at least £30,000 in value, Mr Sinclair being anxious to have cash and not a cheque. That matter might have raised questions in the mind of a purchaser particularly when there is added the fact that the vessel itself was not in showroom condition when sold. I find that the pursuer's suggestion that a reputable company and one of its directors would be engaged in fraudulent conduct either by way of depriving the finance company of their asset or the pursuer of his cash simply cannot be accepted.

Had I been able to hold that the pursuer was entitled to damages, in the above state of the evidence, I would have awarded £12,000.

I sustain the second plea-in-law for the first defender and pronounce decree of absolvitor.