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Cite as: [2000] ScotCS 314

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OUTER HOUSE, COURT OF SESSION

CA78/00

OPINION OF LORD MACFADYEN

in the cause

SWILKEN LIMITED

Pursuers;

against

APPLECRAFT LIMITED

Defenders:

________________

Pursuers: Tyre, Q.C. , Davies; Drummond Miller, W.S.

Defenders: Currie, Q.C.; DLA

8 December 2000

Introduction

[1] This is an action of damages in respect of the defenders' wrongful repudiation of missives in relation to a franchise agreement. The defenders were to be the franchisors and the pursuers the franchisees. The franchise was to confer on the pursuers the right to operate a restaurant in St Andrews under the name "Leonardo & Company". Initially a non-binding Memorandum of Understanding was entered into (No. 6/1 of process). Binding missives incorporating a draft Franchise Agreement (No. 6/2 of process) were then concluded on 7 March 2000. By letter dated 29 March 2000 (No. 6/9 of process) the defenders' solicitors intimated to the pursuers' solicitors that the defenders had "decided not to proceed with the Franchise Agreement". By letter dated 4 April 2000 (No. 6/10 of process) the pursuers' solicitors responded, contending that the defenders were in material breach of the contract and had repudiated it, and intimating that the pursuers accepted that repudiation, and exercised their right to rescind the contract. The pursuers then raised the present action for damages. The defenders now accept that they did wrongfully repudiate the contract.

[2] The pursuers' averments of loss are set out in article 6 of the condescendence. As part of their response, the defenders make reference to the call option conferred on them by Clause 12 of the draft Franchise Agreement, aver that they would have exercised it by October 2002 at the latest, and go on to base a computation of the pursuers' loss on that assertion. The pursuers in turn respond by averring that the call option would have been unenforceable by reason of being void from uncertainty. In their fourth plea-in-law they plead that the defenders' averments about the call option are irrelevant and should be excluded from probation. That issue was appointed to debate.

Contract

[3] The non-binding Memorandum of Understanding contained the following provision:

	"12.	Call Option
		12.1	The Franchise Agreement will incorporate a provision that at any time during the Term, the Franchisor will be entitled to acquire the Franchisees [sic] interest in the Business and the Premises at a value to be fixed by Christie & Company, Glasgow as the value of the Business as a single unit enterprise on a going concern basis."

[4] The pursuers' formal offer to enter into a Franchise Agreement with the defenders (No. 6/2 of process, page 1) contained the following terms and conditions:

	"1.	The agreement ("the Agreement") to be entered into between Applecraft and Swilken will be in terms of the draft Agreement annexed and signed as relative hereto.
	2.	The terms of the Agreement shall be effected as at the date of conclusion of the missives comprising this offer and your unqualified acceptance of this offer ("the Missives") notwithstanding that the engrossment of the Agreement has not yet been subscribed."

The draft Franchise Agreement referred to in condition 1 of the offer comprises pages 3 et seq of No. 6/2 of process. The defenders' solicitors sent an unqualified acceptance (No. 6/2 of process, last page).

[5] Clause 12.1 of the draft Franchise Agreement annexed to the offer was in terms identical to those of Clause 12.1 of the Memorandum of Understanding quoted in paragraph [3] above.

[6] The engrossment of the Franchise Agreement contained a Clause 12.1 in somewhat amended terms but, since that engrossment was never executed, the amended version of the clause is of no contractual significance. As condition 2 of the offer contemplated, the parties were, when the defenders repudiated the contract, bound by the terms of the missives and the draft Franchise Agreement, so far as those terms were capable of having binding effect.

The Law

[7] There was no dispute between counsel as to the principles of law applicable for the purpose of determining whether Clause 12.1 of the draft Franchise Agreement was enforceable. What was in dispute was how those principles fall to be applied to the facts and circumstances of this case, and whether it was appropriate to reach a decision on the pleadings without proof.

[8] Mr Tyre for the pursuers began his reference to authority by citing a short passage from the judgment of Maugham LJ in Foley v Classique Coaches Limited [1934] 2 KB 1 at 13:

"It is indisputable that unless all the material terms of the contract are agreed there is no binding obligation. An agreement to agree in the future is not a contract; nor is there a contract if a material term is neither settled nor implied by law and the document contains no machinery for ascertaining it."

That, he submitted, encapsulated the two related propositions on which he sought to found his argument that the defenders' averments about the call option were irrelevant, namely:-

that Clause 12.1 was an agreement to agree in the future; and
that a material term of the option, namely the price at which it was to be exercised, was neither specified nor ascertainable, because the machinery for Christie & Co to value the business was unworkable in the absence of identification of the date at which the business was to be valued.

[9] Mr Tyre then proceeded with a chronological review of relevant authorities. He began with McArthur v Lawson (1877) 4 R 1134 in which Lord President Inglis said (at 1136):

"A contract which cannot be enforced by specific implement, in so far as regards its form and substance, is no contract at all, and cannot form the ground of an action of damages".

He then turned to County Hotel and Wine Company v London and North Western Railway [1918] 2 KB 251, in which an option was conferred on the tenant or occupier of a hotel adjoining a railway station to rent the refreshment rooms in the station. McCardie J said (at 262):

"I deem it to be a true rule of law that a promise must be reasonably certain, and that if the parties have expressed their agreement in such ambiguous and uncertain terms as to make it impossible to ascertain any definite meaning, then the agreement is necessarily void".

At 263 he went on:

"I am unable to place upon [the option clause] a meaning of a reasonably clear and workable character. It is, in my view, too vague and obscure to enable the Court to enforce it."

The reasons which he then gave for that view included uncertainty as to whether the option was to be exercised by the tenant or the occupier, how and when the option was to be exercised, and whether it could be exercised intermittently, for what period and on what basis the rent was to be fixed, and what the identity of the committee which was to fix the rent was. The matter is addressed in Gloag on Contract at page 11 in the following terms:

"In order to create a contractual obligation an agreement must be reasonably definite. Vague general understandings cannot be enforced. ... And it is not a valid argument, in such cases, that as the defender has clearly agreed to do or give something, and has done or given nothing, he should be liable in damages. It must be determinable what he has agreed to do or give. ... But it is not to be inferred [from what Lord President Inglis said in McArthur v Lawson] that it must be possible to frame a decree for specific implement without going beyond the words of the contract; their uncertainty may be overcome by legal implication. ... It is a question of degree whether a particular obligation, taking the words used and the legal implication, is too vague for enforcement."

May and Butcher Limited v The King [1934] 2 KB 17 contains two very well-known passages on the subject. Viscount Dunedin said (at 21):

"To be a good contract there must be a concluded bargain, and a concluded contract is one which settles everything that is necessary to be settled and leaves nothing to be settled by agreement between the parties. Of course it may leave something which still has to be determined, but then that determination must be a determination which does not depend upon the agreement between the parties. In the system of law in which I was brought up, that was expressed by one of those brocards of which perhaps we have been too fond, but which often express very neatly what is wanted: 'Certum est quod certum reddi potest.' Therefore, you may very well agree that a certain part of the contract of sale, such as price, may be settled by some one else. As a matter of the general law of contract all the essentials have to be settled. What are the essentials may vary according to the particular contract under consideration. We are here dealing with sale, and undoubtedly price is one of the essentials of sale, and if it is left still to be agreed between the parties, then there is no contract. It may be left to the determination of a certain person, and if it was so left and that person either would not or could not act, there would be no contract because the price was to be settled in a certain way and it has become impossible to settle it in that way, and therefore there is no settlement."

In the same case Lord Buckmaster said (at 20):

"It has long been a well recognised principle of contract law that an agreement between two parties to enter into an agreement in which some critical part of the contract matter is left undetermined is no contract at all. It is of course perfectly possible for two people to contract that they will sign a document which contains all the relevant terms, but it is not open to them to agree that they will in the future agree upon a matter which is vital to the arrangement between them and has not yet been determined."

Reference was also made to G Scammell and Nephew Limited v HC and JG Ouston [1941] AC 251 per Lord Wright at 268-9, and to Courtney and Fairbairn Limited v Tolaini Brothers (Hotels) Limited [1975] 1 WLR 297 per Lord Denning MR at 301. In Sudbrook Trading Estate Limited v Eggleton [1983] AC 444, leases contained an option to purchase at a price fixed by two valuers, one appointed by the lessor and the other by the lessee, and in default of agreement by an umpire appointed by the valuers. The machinery broke down because the lessors refused to appoint a valuer. It was held that on a true construction the agreement was for a fair and reasonable price. The machinery was subsidiary and non-essential, and the court would therefore substitute its own machinery to ascertain a fair and reasonable price. In Neilson v Stewart 1991 SC (HL) 22, Lord Jauncey of Tullichettle said (at 39):

"... it is trite law that an agreement which leaves a part, essential to its implementation, to be determined by later negotiations does not constitute a concluded and enforceable contract. ... However, that principle does not necessarily determine the issue in favour of the appellants. The fact that in the usual case a particular term will be considered essential to the existence of a concluded agreement does not prevent parties from contracting in a particular case that it shall not be essential."

Finally, Mr Tyre referred to McBryde on Contract, paragraphs 4-18, 4-21 and 4-26. In paragraph 4-26 it is said that:

"In cases of incomplete expression ... the meaning of the parties may be clear so far as it goes, but there is an absence of expression on an essential terms of their contract. Some cases relate to future bargains of an imprecise nature, others to failure to supply an essential term in an existing arrangement."

The call option provision in the present case, he said, displayed elements of both of those features.

[10] Mr Currie took no issue with the legal principles illustrated by the authorities cited by Mr Tyre, but sought to stress that the court should if possible give effect to a contract which bore to express agreement between the parties. In that connection, he cited R & J Dempster Limited v Motherwell Bridge and Engineering Company Limited 1964 SC 308, per Lord President Clyde at 327-8:

"... when a court of law is asked to construe a commercial arrangement couched in terms which are prima facie obligatory, and which are acted on by the parties as obligatory, the court will prefer a construction which gives the contract binding effect. For the essence of commerce is making bargains, and unenforceable arrangements are the exception and not the rule. As Lord Tomlin said in the House of Lords in Hillas & Co Limited v Arcos Limited (1932) 147 LT 503 at 512:

'the problem for a court of construction must always be so to balance matters, that without violation of essential principles the dealings of men may as far as possible be treated as effective, and that the law may not incur the reproach of being the destroyer of bargains.'"

Mr Tyre, in turn, did not dispute the soundness of those dicta.

The Pursuers' Submissions

[11] Mr Tyre's first submission was that Clause 12.1 was no more than an agreement to enter into an agreement in the future conferring on the defenders an option to purchase the business. He accepted that the mere use of the future tense did not inevitably mean that the clause was unenforceable. However, the language of the clause indicated, he submitted, that the parties did not regard themselves as having reached a concluded bargain as to a call option. The terms of the option remained to be negotiated and settled. There was agreement in principle that there should be a call option, but no agreement as to the terms on which it was to be exercisable.

[12] The fundamental deficiency, Mr Tyre submitted, was that there was no agreement as to the date of valuation of the business for the purpose of settling the price at which the call option might be exercised. All that was agreed was that the defenders should have the right "at any time during the Term" of the Franchise Agreement to acquire the pursuers' interest in the business and the premises, and that the price was to be a "value to be fixed by Christie & Co as the value of the Business as a single unit enterprise on a going concern basis". Although the latter part of the clause made part of the necessary provision for machinery for settlement of the price by a third party, the machinery was incomplete in a respect that could only be resolved by further agreement between the parties. Any valuer asked to carry out the valuation contemplated in the clause would be forced to ask: "At what date is the business to be valued?" The clause provided no pre-determined answer to that question. No express answer could be found, nor was it possible to find one by necessary implication. There were a number of possibilities. The date of valuation might be:

the date on which the defenders intimated that they were exercising the option, even if entry was to be taken at a future date;
the date of exercise of the option in the sense of the date on which the bargain for the acquisition by the defenders was concluded;
the future date of entry specified by the defenders when giving notice of exercise of the option; or
any other date specified by the defenders.

So long as there was more than one possibility, the agreement was incomplete and unenforceable. This was not an example of a breakdown of machinery which the court could cure by the substitution of a machinery of its own devising, as was done in Sudbrook. The deficiency here was such that a conclusion for specific implement of the clause could not be framed with the requisite degree of precision.

[13] There were, in addition, Mr Tyre submitted, other elements of uncertainty or vagueness in the clause which reinforced the inference from the failure to provide for the date of valuation that the parties did not regard themselves as having reached a settled bargain. There was vagueness as to the effect of the phrase "at any time". It was unclear what scope there was for negotiation of the terms on which the option might be exercised. The option was to purchase the pursuers' "interest in the Business and the Premises", but the valuation provision referred only to the value of the "Business"; there was no provision for valuation of the pursuers' interest in the premises. There was thus a mis-match between the two parts of the clause. The pursuers were to be sub-tenants of the premises, and would have incurred substantial capital expenditure in fitting them out, but the clause was silent as to whether, and if so how, these matters were to be taken into account in any valuation.

[14] Mr Tyre submitted that the incomplete form in which Clause 12.1 appeared in the draft Franchise Agreement showed signs of its having been included in a rush to conclude the Franchise Agreement itself. In that situation the court should feel no particular reluctance to hold that it failed to express a concluded agreement on the call option. It could be determined at this stage that Clause 12.1 was defective in a way that could not be cured by implication or the provision of substitute machinery. It was therefore unenforceable. The defenders' averments founded upon it were accordingly irrelevant. Those averments (the passage in Answer 6 from the words "Further explained and averred that in terms of the Defenders' business plan ..." to the end of the answer) should be excluded from probation.

The Defenders' Submissions

[15] By way of preface to his response to Mr Tyre's submissions, Mr Currie submitted that the subject matter of the action was the pursuers' claim for damages in respect of the financial loss caused to them by the defenders' wrongful repudiation of the missives. In that context, even if it were correct that the call option was unenforceable, the averments relating to it should not be excluded from probation. It would be appropriate for the court, in valuing the pursuers' loss, to take account of the fact that, if the contract had proceeded, the defenders might have sought to invoke the call option at an appropriate time. Such an attempt, even if ultimately unsuccessful because the option was unenforceable, might have had an impact on the value of the business. The possibility that the attempt might have been made was thus a factor which bore on the valuation of the pursuers' loss.

[16] Mr Currie's primary submission, however, was that the call option was enforceable, and that the averments based upon it were therefore relevant. It was implicit in the pursuers' own pleadings that valuation of the business on the basis of Clause 12.1 was practicable. He pointed out that the pursuers' pleadings did not expressly identify what the uncertainty was in Clause 12.1 that rendered it unenforceable. It was not said in the summons that the uncertainty in the clause was the failure to specify the date at which the pursuers' interest in the business was to be valued, and that that uncertainty rendered the specified machinery for valuation unworkable. On the contrary, the pursuers' averments contained an esto case dealing with the defenders' contention that they would have invoked the call option, in the course of which they averred:

"In any event, the value of the pursuers' interest in the business at said date [i.e. October 2002] would have been £525,084."

That averment was destructive of the proposition that the valuation machinery provided for in Clause 12.1 was unworkable. It was a straightforward averment of value, put forward in response to the defenders' averment that the value of the business at October 2002, as assessed by Christie & Co, would have been only £225,000. It was not qualified by an averment that it proceeded on an assumption of the date of valuation for which no foundation could be found in the clause. The existence of that averment was sufficient to make it necessary to remit the defenders' whole averments to proof before answer.

[17] Addressing the submission that Clause 12.1 makes no provision for the date of valuation, Mr Currie pointed out first that the provision was for valuation by professional valuers. Those valuers had, according to the defenders' averments, carried out a hypothetical valuation as at October 2002. That did not suggest that it could be held, as a matter of construction, that the machinery for valuation was unworkable. Clause 12.1 provided that the defenders would be entitled "at any time" to acquire the pursuers' interest in the business and premises. The choice of the date of acquisition was therefore for the defenders to make. The reference to value should therefore be construed as value as at the date of acquisition. So far as the other uncertainties identified by Mr Tyre were concerned, there was no basis in the clause for supposing that there was any room for negotiation of the terms on which the acquisition was to take place. The absence of separate provision for the valuation of the premises was immaterial; the clause clearly identified the interest to be acquired, and the value at which it was to be acquired. The proper course in the circumstances was to allow a proof before answer with the disputed averments standing, leaving the issue of enforceability for discussion, if necessary, after evidence of valuation had been led.

[18] There was, Mr Currie submitted, no separate point to be made of the fact that Clause 12.1 began with the words "The Franchise Agreement will incorporate a provision ...". It was clear that the Clause had not been carefully drafted, but the use of the future tense did not make it an agreement to agree in the future.

Discussion

[19] It is in my view clear that an agreement which leaves an essential element of the contract to be agreed between the parties in the future does not constitute an enforceable contract (Foley per Maugham LJ at 13; May and Butcher per Viscount Dunedin at 21 and Lord Buckmaster at 20; Courtney and Fairbairn, per Lord Denning MR at 719; Neilson per Lord Jauncey of Tullichettle at 39). Equally, an agreement which, albeit without expressly contemplating future agreement between the parties, does not settle, or provide workable machinery for settlement of, an essential element of the contract does not constitute an enforceable contract (Foley, loc. cit.; County Hotel and Wine Co, per McCardie J at 262; May and Butcher, per Viscount Dunedin at 21). What is an essential element varies according to the particular contract under consideration (May and Butcher, per Viscount Dunedin at 21; Neilson, per Lord Jauncey of Tullichettle at 39). Failure to make express provision for an essential element of the contract will not be fatal to its enforceability if the omission can properly be cured by implication (Foley, loc. cit.; Gloag on Contract, page 11). The court will do its best to give effect to a commercial arrangement that bears to have been intended by the parties to be obligatory, and will prefer a construction that gives the contract binding effect to one which leaves it unenforceable (Hillas; per Lord Tomlin at 512; Scammell and Nephew, per Lord Wright at 268; Dempster, per Lord President Clyde at 327-8). None of those propositions was in dispute in the present case. The issue was as to their proper application.

[20] I do not consider that Clause 12.1 of the Franchise Agreement is an example of a contract that is unenforceable on the ground that it is a mere agreement to agree in the future. Clause 12.1 of the Memorandum of Understanding did not constitute an enforceable call option, but that was because the document expressly provided (by Clause 2) that (except for certain specifically identified provisions) it would not be contractually binding, rather than because Clause 12.1 was expressed in the future tense. The incorporation of Clause 12.1 in the draft Franchise Agreement in the same terms as the corresponding clause in the Memorandum of Understanding was, it seems to me, a drafting mistake, a failure to recognise that the language used was inappropriate for incorporation in the Franchise Agreement itself. It makes no syntactical sense to say, in the body of the draft Franchise Agreement incorporated into the binding missives, that the Franchise Agreement "will incorporate" a particular provision. If the provision so introduced is in terms that are otherwise capable of being given immediate binding effect, I do not consider that the inept use of the phrase "will incorporate", as if the document in which it appears had yet to be drafted, would be sufficient to prevent its being given such effect. If, on the other hand, the provision is lacking in the expression of agreement on the essential elements of the call option, it will be unenforceable for that reason rather than because of the use of the future tense.

[21] What terms must be agreed for the conclusion of a binding contract will depend on the nature of the contract; and the circumstances of a particular contract may show that the parties have agreed that a provision which would ordinarily be essential in a contract of the class in question is not regarded by them as essential in the particular case (Neilson, per Lord Jauncey of Tullichettle at 39; e.g. Dempster). In a contract conferring an option to purchase a business the price at which the option may be exercised is ordinarily an essential element of the contract, just as price is ordinarily an essential element in any contract of sale (May and Butcher, per Viscount Dunedin at 21). It was not disputed that in the present case, the price at which the call option might be exercised was an element of the contract that required either to be settled or to be the subject of agreed machinery capable of settling it. Here the provision was that the price was to be the value fixed by named valuers. The value to be fixed was identified as the value of the business (as that term is defined in the Franchise Agreement) as a single unit enterprise on a going concern basis. The principal criticism of the sufficiency of that provision was that it did not identify the date as at which the valuation was to be made. There is in my view force in the pursuers' submission that, if there were more dates than one as at which the business might be valued, and the contract left it unresolved and impossible to resolve which of those was to be adopted, an essential element of the mechanism for fixing the price at which the option might be exercised would be missing. I agree that the missing element would not be one that the court could supply in the manner exemplified in Sudbrook, but would be one that could only be supplied by further agreement between the parties. There would, on that hypothesis, in my opinion be merit in the pursuers' submission that the call option purportedly conferred on the defenders by Clause 12.1 of the Franchise Agreement was unenforceable.

[22] It therefore seems to me that the enforceability of the call option comes to depend on whether the pursuers are right in their contention that Clause 12.1 leaves open the possibility of more than one date for valuation. It is certainly the case that the clause does not expressly declare that the valuation was to be carried out at a particular date. But in the absence of such an express declaration, the next question in my opinion comes to be whether as a matter of construction of the provision an inference as to the intended date of valuation can be drawn. Mr Tyre in his submissions identified a number of possible dates of valuation. I accept that the various dates which he mentioned are possibilities, at least in the sense that they are all dates which the parties might, by express agreement, have chosen for the purpose. It does not, however, in my view, follow that they are all possibilities when the matter is left as it is left in Clause 12.1. All that the clause says is (i) that the defenders will be entitled "at any time" to acquire the pursuers' interest in the business and the premises, and (ii) that they will be entitled to do so at a value fixed by Christie & Co as the value of the business on a certain basis. When the clause says no more than that, it is in my view a reasonable inference that the valuation was to be carried out as at the date of acquisition. The defenders were left free by the terms of the clause to choose the date on which they would acquire the business. There is, in my view, no other candidate as the date as at which the value of the business was to be fixed. The position might have been different if the clause had been more complex in structure and had provided, for example, for a period of notice to be given by the defenders if they wished to exercise their option. That might perhaps have given rise to the sort of uncertainty figured by Mr Tyre as to whether the date of giving the notice, or the date of acquisition following on such notice, was to be the date for valuation. Where, however, no date or time other than the time of acquisition is mentioned in the clause, I am of opinion that the proper construction of it is that the value to be fixed by the named valuers was to be the value at the date chosen by the defenders as the date on which to acquire the business.

[23] The other possible uncertainties identified by Mr Tyre do not in my view render the call option unenforceable. (1) I do not consider that the phrase "at any time", when read in context, gave rise to any uncertainty. It had the effect, in my view, of entitling the defenders to exercise the option whenever they chose during the term of the Franchise Agreement. (2) There is, in my view, no basis in the clause for inferring that any scope for negotiation of the terms on which the option was to be exercisable remained. The subjects which the defenders were given the right to acquire were identified as the pursuers' interest in the business (as defined) and the premises (as defined). The price at which they were to be acquired was to be fixed by a named firm of valuers at the value of the business "as a single unit enterprise on a going concern basis". The date as at which the business was to be valued was, as I have held as a matter of construction, to be the date of acquisition under the option. No more was required, and there was nothing in the clause to suggest that there was to be room for further negotiation. (3) The element identified by Mr Tyre as the "mis-match" between the two parts of the clause is not, in my view, the source of any uncertainty. It may give rise to an issue as to the proper construction of the phrase "the value of the Business as a single unit enterprise on a going concern basis", but it does not seem to me to be a matter incapable of resolution as a matter of construction.

[24] I am therefore of opinion that the pursuers' attack on the enforceability of Clause 12.1 of the Franchise Agreement fails, and that their challenge to the relevancy of the averments in which the defenders seek to measure the pursuers' loss on the hypothesis that the call option would be enforced in October 2002 consequently fails.

[25] I do not consider that Mr Currie was well founded in his submission that it was implicit in the pursuers' averment about the value of the business in October 2002 that they accepted that the valuation provision in Clause 12.1 was workable. That averment was clearly made in response to the defenders' averment that as at October 2002 the value of the business would be £225,000. It offered an alternative view of the value of the business "at said date". The averment therefore proceeds on the hypothesis of valuation as at October 2002. Mr Tyre did not attempt to suggest that the valuation exercise could not be carried out, if the date as at which it was to be carried out was first identified. His point was that Clause 12.1 did not provide an answer to the question, "As at what date is the business to be valued?" The making of the pursuers' averment about value in October 2002 does not prejudice their position on that point.

[26] Finally, I should deal with Mr Currie's preliminary point (see paragraph [15] above). In the event, it does not arise, but had it done I would have held that it was not well founded, as the defenders' pleadings stand. It may be correct that the presence in the Franchise Agreement of an unenforceable call option would have had an adverse effect on the value of the pursuers' interest in the business. If the defenders had made their averments about the call option in order to make that point, it might have been necessary to admit the averments to probation in that connection even if I had held that the call option was unenforceable. But that point is not taken in the defenders' pleadings. Accordingly, if I had accepted the pursuers' submission that the call option was unenforceable, I would have excluded the defenders' averments about it from probation.

Result

[27] For the reasons given in paragraphs [19] to [24] above, I shall therefore repel the pursuers' fourth plea-in-law and allow a proof before answer of the parties' respective averments, including the passage in Answer 6 that the pursuers sought to have excluded from probation. I shall also put the case out By Order for the purpose of fixing a diet of proof, and determining what further preparatory procedure ought to be adopted prior to that diet.