Scottish Court of Session Decisions

Bald & Ors v. Davidson & Ors [2003] ScotCS 104 (4 April 2003)

OUTER HOUSE, COURT OF SESSION
A/2175/01	OPINION OF T. G. COUTTS, Q.C. Sitting as a Temporary Judge in the cause MARTIN BISSETT BALD and ANOTHER Pursuers; against CLIVE DAVIDSON and MRS ANNE DAVIDSON trading as "CHAMPANY INN" Defenders:   ________________

 

Pursuers: MacLean; Lindsays, W.S.

Defenders: Gardiner; Dundas & Wilson, C.S.

26 February 2003

1. The pursuers sue as assignees of the outstanding claims against the defenders in respect of work carried out by Martin Bald Limited, a company incorporated under the Companies Acts. The pursuers were formerly directors of the company.
2. In or about 1995 the parties were friendly. The pursuers aver that they entered into a contract with the defenders to carry out the works which the defenders required at their site at Champany Inn, near Linlithgow. They aver that a feasibility study based on drawings which the pursuers had obtained for the defenders had been prepared. That study set out quantities and rates. Thereafter, according to the pursuers' averments, various matters were dealt with by the pursuers on behalf of the defenders. In September 1996 the company produced an outline cash plan based on the feasibility study in order to enable the defenders to have prepared a business plan for their financiers. It set out various prices. Various additional works and variations were instructed as the works progressed. Normally bills were rendered by the company monthly, and there were usually paid. It is in relation to all these matters, specified in considerable detail by the pursuers, that they seek payment. They aver that there was no fixed price agreed or discussed. The parties did not expressly discuss the method of quantifying the price or how it was to be paid, but it is said that it was an implied term of the contract that the company was to be paid a reasonable sum for the works carried out on the defenders' instructions and on their behalf, together with VAT, together with reimbursement of outlays such as fees incurred to professional advisers and fees for applications for the appropriate statutory consents.
3. The defence, although difficult to follow, would appear to be that the pursuers have been paid "an amount in excess of all sums due in respect of the contract price and in respect of variations to the works instructed by the defenders".
4. Accordingly there is an initial dispute between the parties as to whether or not there was a contract price. The pursuers aver there was not and seek payment for the works they have done quantum meruit.
5. At the procedure roll discussion the defenders argued that the action should be dismissed on the ground of lack of specification of the basis upon which the claim quantum meruit was quantified. As a subsidiary matter they moved that should the Court be of the view that the claim quantum meruit could proceed. Proof should be divided in terms of Rule 36 so that inquiry could be made and thereby whether there was a contact price or whether payment was to be made quantum meruit could be established.
6. I did not find in favour of the defenders on either of these propositions and allowed them a proof before answer and it is against that allowance that the defenders have now lodged a reclaiming motion.
7. The defenders' primary stance as exemplified in their Note of Argument bore to found upon the proposition that it is a fundamental rule of our pleading that a party is not entitled to establish a case against his opponent of which the other has not received clear notice upon record. The question was thus whether the defenders had fair notice of the pursuers' claim for payment quantum meruit.
8. It should be noted however that the above quotation from Lord Guthrie in Morrison's Associated Companies Limited v James Rome & Sons Limited 1964 SC 169 at 190 continues:

"It follows that a defender cannot be held liable upon a ground which is not included in the averments made against him by the pursuer. These are not mere technical rules since their disregard would tend to create injustice by imposing liability on a defender for reasons which he had had no opportunity to refute."

9. Defenders' counsel cited other examples of a similar proposition although he required to seek to distinguish the cases of Avery v Hew Park School for Boys 1949 SLT (Notes) 6; Avintair Limited v Ryder Airline Services Limited 1994 SC 270 and Robert Barry & Co v Doyle 1998 SLT 1238. In that latter case the Lord Ordinary held that although no evidence could be led at proof as to a level of fees that other estate agents would charge, it was possible that on the narrow basis of factors contained in the history of dealings between the parties a case for payment quantum meruit could be made out. It should be easy, in the present case, said the defenders' counsel, to provide specification of the prices and rates which applied to specific works of a similar nature and scale in Livingston and the surrounding area during the period of time over which the works were carried out (31 C-D of the Closed Record), and that course should be followed.
10. In response, the pursuers' counsel accepted that of the two ways in which a reasonable sum could be arrived at, the first, that of a customary price, was not the pursuers' approach. Accordingly in the present case the pursuers had to prove what was a reasonable rate of payment on the evidence. They had available to them a wide variety of ways to do so. In the present case, he said, they had two summary schedules, the payments which have been made, and a body of productions which have been lodged. The averments also clearly indicate a substantial course of dealing between the parties in which payments have been made on an accepted basis. The Court should look at the matter broadly to determine whether the defenders could reasonably be said to be prejudiced by any matters not pled, bearing in mind that a pursuer does not require to plead evidence. Accordingly the question for the Court is whether there is sufficient material before the Court upon which it could come to a view as to the appropriate payment.
11. I had no hesitation in determining that this was not a case which could be dismissed because of an alleged lack of specification. In my view there was ample material in the pleadings, which I have not recited ad longum, together with a substantial body of productions as well as the schedule attached to the Record and the admitted course of the operation of the contract between the parties. The Court, if so advised after inquiry, could form from these a view as to reasonable remuneration.
12. There is a distinction to be drawn between a failure to plead a case inferring liability, as Lord Guthrie adverted to in Morrison v Rome and what is required to be pled in relation to providing a basis for an inquiry into quantification. There is no question in the present case of the defenders being found liable upon some ground which they do not know about. The only question is how much the defenders should pay. Accordingly, I took the view summarily that there was more than ample specification justifying allowing the case to proceed to inquiry.
13. I declined to divide the proof. The question of whether there was a contract sum agreed with extras for which payment required to be made and whether there was a composite body of works for which payment required to be made, seemed to me to be sufficiently intertwined as to provide no benefit in splitting the proof. Much of the evidence will be common and should the pursuers be wrong and be held to a fixed price contract, then the expense of any additional inquiry on other matters would fall upon them. They did not and do not seek a divided proof in terms of Rule 36.1. The Court has a discretionary power to order separation of matters in a proof but in the present case I decline to exercise that discretion. I can see no evident utility in so doing since the pursuers seek to have their action heard as speedily as possible as is their right.