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Gillespie v Fitzpatrick [2003] ScotCS 233 (04 July 2003)

OUTER HOUSE, COURT OF SESSION

A45/03

NOTE BY LORD EASSIE

in the cause

JAMES GILLESPIE

Pursuer;

against

JOSEPH FITZPATRICK

Defender:

________________

Pursuer: McGregor; Thompsons

Defender: Dunlop; Harper Macleod

4 July 2003

[1] This action, which is a claim for reparation for personal injuries suffered in a road traffic accident, called before me on the motion roll on 4 July 2003. For present purposes the material part of the motion enrolled by the defender was for decree in terms of the Minute of Tender No. 10 of process and the Minute of Acceptance No. 11 of process and for modification of the expenses of the pursuer to sheriff court ordinary cause expenses. Opposition to the motion was marked by the solicitors acting for the pursuer. The ground of opposition noted in the opposition sheet was "no proper notice given" but in the event the argument before me turned on entirely different matters. Having heard counsel I granted decree in the terms sought and modified the expenses as sought in the motion made to me. I understand that my decision is now the subject of a reclaiming motion.

[2] In moving his motion Mr Dunlop, who appeared for the defender, gave a short history of matters which, from my notes and recollection, may be rendered as follows:

(i) The road traffic accident giving rise to the action occurred on 24 February 2002 (and not 24 February 2000 as erroneously indicated in Article 2 of Condescendence). A claim was intimated shortly thereafter. On 27 March 2002 the defender's insurers wrote to the pursuer's solicitors accepting liability.

(ii) By a letter of 25 April 2002 (a copy of which was shown to me) the solicitors for the pursuer wrote in response to that admission of liability stating that they valued solatium in the sum of £3,500. The letter indicated that no patrimonial heads of loss were being claimed. For reasons not explained to me the claim was not settled at that point and eventually, on 14 February 2003, the pursuer raised the present action in the Court of Session under optional procedure.

(iii) Following service of the action defences were lodged which repeated the admission of liability but challenged the quantum of damages claimed - the sum concluded for being £20,000. Apart from an apparently minor claim for services, the loss for which damages were sought was confined to solatium. On 3 April 2003, at the first calling of the case on the optional procedure diet roll, a proof on quantum was allowed.

(iv) On 23 June 2003 the defender lodged and intimated the Minute of Tender No. 10 of process. The material part of the Minute is in these, essentially standard, terms.

".... tenders to the pursuer the sum of THREE THOUSAND POUNDS [£3,000], (net of any liability which the defender may have in terms of the Social Security (Recovery of Benefits) Act 1997), together with the expenses of process to the date hereof, in full satisfaction of the conclusions of the summons".

(v) On 1 July 2003 there was lodged in process the Minute of Acceptance of Tender, No.11 of process. The Minute of Acceptance is in these terms:-

"Millar for the pursuer states to the Court that the pursuer hereby accepts the Tender contained in the Minute of Tender Number 10 of Process in the sum of THREE THOUSAND POUNDS (£3,000) STERLING net of CRU benefits together with expenses of Process to date in full settlement of the conclusions of the Summons".

(vi) The lodging of that Minute of Tender had been preceded by a fax message from the pursuer's solicitors to the defender's solicitors on 27 June 2003, a copy of which was exhibited to me. In that fax message the pursuer's solicitors intimated the Minute of Acceptance and their intention to lodge it on 1 July. The fax message contained the further paragraph:

'Please note that lodging of the Minute of Acceptance and the enrolment of our Motion is conditional on expenses in this cause being on the Court of Session scale'.

The fax thereafter requested a cheque in settlement of the principal sum in early course; intimated that the pursuer would advise the Keeper of settlement; and announced that the pursuer's account of expenses would follow shortly.

(vii) On 1 July 2003 the pursuer's agents duly enrolled a motion for decree in terms of the Minute of Tender and Minute of Acceptance of Tender and for certification of a member of the medical profession as a skilled witness. On the following day that motion was dropped by the pursuer's solicitors who sought to withdraw their acceptance of the tender. They did so by the unorthodox means of physically removing the Minute of Acceptance of Tender from process.

(viii) On 2 July 2003 the solicitors acting for the defender enrolled the motion which came before me.

[3] The history given by Mr Dunlop was not disputed by Mr McGregor, who appeared for the pursuer. Further, counsel for the pursuer stated that the pursuer's agents now fully accepted that it was quite improper for them to have extracted the Minute of Acceptance of Tender from process and for that impropriety they unreservedly apologised. They undertook to return the Minute of Acceptance to process. I can record that the undertaking has now been honoured.

[4] Counsel for the defender indicated that, as a result of his discussions with counsel for the pursuer, there were two issues in dispute. The first was whether there was agreement between the parties, given their current difference over the scale of expenses which should be allowed; the second was whether, assuming there were a concluded agreement, expenses should be modified as sought by the defender.

[5] As I understood the submission on behalf of the pursuer respecting the first of those issues, nothing turned on the attempted withdrawal of the Minute of Acceptance of Tender. Further, counsel for the pursuer did not seek to found on the purported attachment of a condition to the acceptance by virtue of the terms of the fax of 27 June 2003. Indeed, as counsel for the defender attempted to anticipate an argument along those lines, counsel for the pursuer indicated that no reliance was placed by him on the terms of that fax message. The submission for the pursuer was that since there was evident disagreement about what was meant by the expression "expenses of process" in the Minute of Tender there was no consensus in idem. Although counsel for the defender had referred to McKenzie v H D Fraser and Sons 1990 S.L.T.629 as indicating that an offer of expenses of process was an offer of such expenses as the Court might deem appropriate, that did not apply in the circumstances of the present case where the parties were, said counsel for the pursuer, in dispute from the outset as to the appropriate level of expenses. Counsel for the pursuer further referred to Bright v Low 1940 S.C.280. There was accordingly no consensus and for that reason the motion should be refused outright.

[6] I had little difficulty in rejecting this contention. The Minute of Tender is in standard form (it not being suggested that any issue arose as to the recovery of benefits, either in the letter of claim or in the argument before me). The offer contained in that Minute of Tender was met by an unqualified acceptance in essentially customary form in the Minute of Acceptance of Tender. The phrase "expenses of process" is well known and, particularly since McKenzie v H D Fraser and Sons, is recognised as meaning that the Court retains a discretion as to the level or amount of expenses to be attached to the offer. In delivering the Opinion of the Court in McKenzie the Lord President (Hope) observed, at 632K:

"The purpose of the tender is to offer a specific sum with expenses, so that if he accepts it the pursuer will be placed in the same position as if, at the date of tender, he had obtained a decree for the amount tendered. There is nothing to stop a defender from making an offer with modified expenses or to stop the pursuer from accepting an offer on these terms, but the rules as to judicial tenders do not admit of this approach because, in the absence of agreement, expenses are always at the discretion of the Court. The fact that the principal sum offered in some cases may be small in relation to the potential expenses should not be allowed to obscure the fact that the true purpose of a tender is to identify the principal sum which the defender is prepared to pay in settlement of the pursuer's claim. The expenses are, as Maclaren on Expenses puts it at p.4, merely incidental to the cause, which is why the rule has always been that the award of expenses is at the discretion of the judge before whom the cause has been heard".

In lodging the Minute of Acceptance of Tender the pursuer thus accepted, additionally to the principal sum, an offer of expenses which amounted to such expenses such as might be allowed in the discretion of the Court. Had the pursuer's solicitors intended to negotiate a separate deal, excluding the Court's discretion as to the level of expenses, that could of course have been done extra-judicially but in this case they elected to accept a judicial tender in standard form. The fact that there may be now, and then, differing contentions as to the appropriate level of expenses to be awarded by the Court in the exercise of its discretion, does not mean that there was no consensus in idem. Insofar as counsel for the pursuer referred to Bright v Low, I have to say that I did not find that reference to be of any assistance.

[7] I turn now to the question of the appropriate level of expenses. In moving for modification of the scale of expenses to that obtaining in the sheriff court, ordinary cause, without sanction of counsel, Mr Dunlop referred to Coyle v William Fairey Installations Ltd 1991 S.C.16 and particularly the passage at p.19^1/2 in which the Court said this:

"The proper approach ..... is that in respect of actions brought in the Court of Session the court should determine whether the initial choice of that forum was justified in all the circumstances of the case known to the pursuer's advisers when the action was raised, having regard to the high level of costs likely to be incurred by bringing an action there. The court's judgment on that matter may be assisted by a consideration of events which have occurred subsequent to the date on which the choice was made, including the very important consideration of the result of the case; but the result, particularly if it is one which is achieved by settlement, does not necessarily resolve the issue whether the initial choice of forum was inappropriate on the ground that the value of the claim was not commensurate with Court of Session expenses. For example, a pursuer might well agree to a settlement figure at substantially less than that at which a claim had been properly valued, in order to avoid a prolonged period of delay and uncertainty, or because further information had come to light of which the pursuer's advisers were justifiably unaware when the action was commenced".

[8] Focusing accordingly on the initial choice of forum, counsel for the defender invoked the following factors as demonstrating that the appropriate court was the Sheriff Court and not the Court of Session. Firstly, so far as the merits of the action were concerned, liability had already been admitted in what was in any event a straightforward road traffic accident claim. On quantum, there was no issue of any complexity and the pursuer's solicitors had already valued the claim in the sum of £3,500. Nothing had significantly altered since that valuation, as was demonstrated by the acceptance of the tender of £3,000 (with the initial defences repeating judicially, the admission of liability offered by the insurers at the outset).

[9] For his part Mr McGregor maintained that Court of Session expenses should be allowed. The case was, he said, suited to optional procedure and he referred to what was said by the Lord Ordinary (Jauncey) about that procedure in Giles v Fleming Brothers Structural Engineers Ltd 1987 S.L.T.114 and particularly the sentence at 115K - "the optional procedure appears to be ideally suited to cases arising out of road traffic accidents and to cases arising out of industrial accidents where the facts are within relatively small compass and the medical evidence is straightforward".

[10] I took the view that the fact that the particular case may be of a kind suited to optional procedure in the Court of Session rather than ordinary procedure, does not mean that it is by that fact itself appropriate to bring the case in the Court of Session under the former procedure. Mr McGregor's invocation of that particular sentence in Lord Jauncey's Opinion is, to some extent, taken out of context. It was, and is not, the intention behind the optional procedure that cases of low value, straightforward in their nature, and wholly suited to the sheriff court should be brought in the Court of Session and thereby expose the defending party to liability for Court of Session expenses. Particularly given that this is a case in which a pre-action admission of liability had been made, it was difficult to see - and counsel for the pursuer did not suggest - any noteworthy, procedural advantage in the Court of Session optional procedure.

[11] Given the pre-litigation admission of liability, the recognised low value of the claim in the pre-litigation correspondence, and the absence of any material change of circumstance between that pre-litigation discussion and the raising of the action, it was in my view impossible to see any good ground upon which the motion for sheriff court expenses, without sanction of counsel, could be resisted.

[12] As earlier indicated, I therefore granted the motion for decree in terms of the Minute of Tender and Acceptance, with expenses on the sheriff court, ordinary cause, scale without sanction of counsel.