Scottish Court of Session Decisions

Labinski Ltd v. BP Oil Development & Ors [2003] ScotCS 15 (24 January 2003)

EXTRA DIVISION, INNER HOUSE, COURT OF SESSION
Lord Marnoch Lord Johnston Lord Bonomy	A1967/00 OPINION OF THE COURT delivered by LORD MARNOCH in RECLAIMING MOTION FOR THE PURSUERS in the cause LABINSKI LIMITED Pursuers and Reclaimers; against (FIRST) BP OIL DEVLOPMENT COMPANY and OTHERS Defenders and Respondents: _______

 

 

Act: Martin, Q.C., Wilson; (Anderson Strathern, W.S., [for Gray Connochie, Solicitors, Aberdeen]) for Pursuers and Reclaimers

Alt: Dean of Faculty, Q.C., Young (McGrigor Donald) for Defenders and Respondents

24 January 2003

1. This is a reclaiming motion against an interlocutor of the Temporary Judge which upheld the defenders' first plea-in-law directed to the relevancy and specification of the pursuers' averments and dismissed the action.
2. The background to the action is that by Deed of Servitude dated 15 August 1975 and recorded in the General Register of Sasines for the County of Kincardine on 2 September, 1975 the defenders acquired "an heritable and irredeemable Servitude right, tolerance and wayleave ... of laying down, maintaining, renewing and protecting a line of steel pipe, not exceeding Thirty six inches internal diameter" in and through certain lands in the vicinity of Stonehaven which are now in the ownership of the pursuers. The right in question was, however, granted subject to a number of conditions which were contained in a schedule to the Deed of Servitude and of which Condition 25 is, inter alia, in the following terms:

"DEVELOPMENT OF LAND

(a) If at any time the Owner wishes to develop land affected by the pipeline, or to accept an offer from some person who wishes to develop such land, the Owner shall if the said proposed development of the land is prevented in whole or in part by reason only of the existence of the pipeline, give written notice to the Company of the said proposed development including details of the application for and refusal of or conditional grant of planning permission in principle by the Planning Authority. Within six calendar months of the receipt of such written notice, the Company shall give their decision in writing to the Owner that they intend to divert the pipeline or that they intend to pay compensation for all losses arising from their decision not to divert the pipeline, including, without prejudice to the foregoing generality, losses of Development Value.

...

(e) If the Company shall fail to intimate their decision within six calendar months in terms of paragraph 25(a) hereof, the Owner shall be entitled to interpret such failure as a decision by the Company to pay compensation as aforesaid, and the Company shall become liable to pay compensation with interest as aforesaid as if they had intimated their decision to do so.

(f) Notwithstanding the provisions of Clause 25 the Company shall not be liable to pay compensation if the Company can prove that planning permission has been or would have been refused for the proposed development on grounds unrelated to the existence of the pipeline nor shall the Company be liable to pay compensation as aforesaid more than once in respect of any particular piece of land, unless the previous payment of compensation has been repaid to the Company as aforesaid."

3. In the present action the pursuers and reclaimers sue for £31,000,000 being, it is alleged, compensation due to them under Condition 25. The defenders dispute the existence of any liability in terms of that condition.
4. As is so often the case, the debate before us took a rather different shape from that in the Outer House.
5. For the pursuers and reclaimers it was eventually accepted that, in order to plead a relevant case, there would have to be averments, first, that the pursuers wished to develop land affected by the pipeline; second, that a development proposed by them had been prevented in whole or in part by reason only of the existence of the pipeline; and, third, that written notice of the claim for compensation had been given to the defenders including details of the application for and refusal of or conditional grant of planning permission in principle by the Planning Authority. Assuming, however, that such averments were made (as to which there was no dispute) it was unnecessary for the pursuers to make any further averments regarding the reasons given for the refusal or conditional grant of planning permission since by virtue of Condition 25(f) the onus of proof was then on the defenders to aver and prove that planning permission "[had] been or would have been refused for the proposed development on grounds unrelated to the existence of the pipeline". In the present case the pursuers had gone further than strictly necessary by averring that one of the reasons for refusal of planning permission was, in terms, related to the pipeline. If, however, the onus did not pass to the defenders in the manner suggested, then the fall-back submission for the pursuers was that they, themselves, had sufficient averments to indicate that the substance of the planning refusal was related only to the existence of the pipeline.
6. On the other side of the debate, counsel for the defenders and respondents made clear to us in a way which was perhaps not made clear to the Temporary Judge that, whether or not it was generally permissible to look behind the terms of a notice of refusal of planning permission - as to which see generally R. v. West Oxfordshire District Council ex parte C.H. Pearce Homes Ltd [1986] J.P.L. 523 at pp. 524-5 - when it came to an examination of the reasons given for the refusal or conditional grant of planning permission for purposes of Condition 25, evidence to explain or embellish these reasons would clearly be admissible. For example, where one of the reasons for refusal related ex facie to "green belt", it might be possible to show that the green belt in question only came into existence as a result of the pipeline. We are in no doubt that the concession just described was properly made but, at the same time, we have difficulty in seeing why, as was submitted, it should only be possible by parole evidence to clarify, explain or embellish a particular reason as stated in the refusal notice. On the contrary, we consider that in an appropriate case it should be open to the claimant to demonstrate that the refusal in question was due to the totality of reasons specified in the notice and that, in the absence of the pipeline, the other reasons given would not on their own have led to a refusal. When, however, this latter hypothesis was put to counsel for the defenders the position adopted by them was that no such case could in any event be found in the present pursuers' pleadings. Unfortunately, the Temporary Judge's attention does not appear to have been much directed to the pursuers' written pleadings since it seems from his opinion that he dismissed the action simply on the basis of the reasons as set out in the written notice of refusal of planning permission.
7. We turn, then, to these reasons, namely the reasons appearing in the written notice of refusal of planning permission relied on by the pursuers. Although there was later an appeal to the Secretary of State in relation to a reduced development the refusal notice relied on for present purposes is a refusal notice issued by Grampian Regional Council on 22 August 1995. There is no dispute that that notice gives the following four reasons for refusal:-

"(1) The risk of harm to people at the development would be sufficiently high that planning permission should be refused on the grounds of safety, consistent with Aberdeen Area Structure Plan Review Policy T35 and Grampian Structure Plan Transportation Policy 26.

(2) The Proposal would result in the loss of prime quality agricultural land, contrary to Aberdeen Area Structure Plan Review Policy ENV2 and Grampian Structure Plan Natural Resources Policy 13.

(3) The proposal, being separated from the town by the by-pass, would be detrimental to the urban form and setting of Stonehaven and to the appearance of the countryside in the area of the application, contrary to Grampian Structure Plan Rural Grampian Policy 5.

(4) The proposal, if implemented, would give rise to unwarranted risk associated with movement across the A90 trunk road."

8. In our opinion, the foregoing reasons were prima facie destructive of the claim for compensation as intimated by the pursuers to the defenders. This was, indeed, conceded by senior counsel for the pursuers and reclaimers but for his submissions anent the matter of onus. In our opinion, however, the argument anent onus can be seen at this stage to be wholly artificial. We say "at this stage" because, even supposing that there was some initial onus on the defenders to prove that planning permission "[had] been or would have been refused for the proposed development on grounds unrelated to the existence of the pipeline" it seems to us that they have discharged that onus as soon as it is agreed that the reasons for refusal ex facie of the notice were those set out above. In that situation, and as conceded by counsel, the prima facie inference is that planning permission has been, or, at least, would have been, so refused. That being so, as the Dean of Faculty for the defenders and respondents put the matter, "if nothing else is said, the pursuers must lose."
9. In the end, therefore, it seems to us that in a case arising under Condition 25 everything will turn initially on the terms of the notice of planning refusal which was accepted by both parties as being the starting point for any enquiry. In some instances the initial inferences to be drawn may favour the claimants. In other instances they may favour the defenders. In the present case, as we have noted, Mr Martin, Q.C., for the pursuers and reclaimers, very fairly and properly accepted that reasons (2), (3) and (4) set out in the notice of refusal were on the face of them, perhaps individually but in any event collectively, sufficiently substantial as to give rise to the inference that the proposed development of the pursuers' land had not been prevented in whole or in part by reason only of the existence of the pipeline. In that situation, and there being no dispute regarding the actual terms of the notice, the onus must now be on the pursuers to aver and prove why that prima facie inference should not be drawn. We would add that, while we were not referred to any authority on the subject of onus, our conclusions on this matter are generally in accord with the law as set out in Walkers on Evidence 2^nd ed. at paras. 2.1 and 2.2. In particular, we adopt the statement at para. 2.2.3 that -

"if, at any stage of the case, the judicial admissions give rise to a presumption or inference of fact, which, if not rebutted, entitles one of the parties to succeed, the burden of rebutting the presumption or inference of fact rests upon his opponent."

10. Although we have so far dealt with the matter on the basis that Mr Martin was correct in his submissions anent the initial onus of proof, we should, perhaps, make it clear that we are far from satisfied that these submissions were, as matter of law, well-founded. While in the event it is unnecessary to decide the point, it seems to us very arguable that sub-clause (f) of Condition 25 does no more than recognise that, just as the claimants can seek to displace inferences adverse to them arising from the reasons given in the notice of planning refusal, so, likewise, the defenders can seek to displace inferences adverse to them arising from such reasons. In short, and as we have already said, it seems to us that everything will turn on what initial inferences fall to be drawn from the particular terms of the refusal notice in question.
11. In light of the above, all that remains is to examine what we have described as the "fall-back position" adopted by counsel for the pursuers and reclaimers. As to that, we are entirely satisfied that the pursuers have tabled absolutely no averments which are sufficient to displace the prima facie inference or inferences to be drawn from reasons for refusal nos. (2), (3) and (4). At two places in the pleadings (p. 13B and p. 25C - D) there are arguably assertions that the requirements of Condition 25 are satisfied but these assertions do not constitute averments of fact such as might lead to a displacement of the inference or inferences in question. For the rest, Mr Martin frankly accepted that, despite their length and complexity, the pursuers' averments did no more than emphasise the importance of the pipeline as a reason for refusal. In the circumstances of the present case, however, where the other reasons are accepted as being prima facie independent of the pipeline and substantial in their own right, such averments are clearly insufficient to instruct evidence such as would remove the inference or inferences to which we have referred.
12. In the result, albeit for rather different reasons from those given by the Temporary Judge, we have reached the view that the pursuers' pleadings in this case are indeed irrelevant and that the action was properly dismissed. The reclaiming motion is accordingly refused.
13. The Temporary Judge states that he would also have dismissed the action on the ground of lack of fair notice regarding the damages claimed. However, the argument to that effect was not insisted in before us and we say nothing further about it.