Scottish Court of Session Decisions

On 13 October 2003, I allowed the parties a debate on that plea. I also appointed the parties to lodge, in process, not later than two days before the debate, a note of argument stating the legal propositions on which it was proposed to submit that any preliminary plea should be sustained or repelled, with reference to the principal authorities and statutory authorities to be founded on. The pursuer obtempered that order. The defenders did not. When asked to explain why no note of argument had been lodged for the defenders, defenders' counsel said that it had been thought sufficient that in the note on further procedure which had been lodged, in advance of a procedural hearing, notice was given of what the defenders would intend to argue in support of the fourth plea-in-law. I did not find that to be an acceptable excuse for the defenders' failure to lodge a note of argument with reference to the authorities which were to be relied upon. I wish to make it clear that, in commercial procedure, at least, if the Court makes an order of that kind, it does so for good reason and it is not for the parties themselves to decide that they are free to ignore it. One of the purposes of requiring a note of argument is to ensure that the representatives of the party seeking to discuss a preliminary plea, at debate, apply their minds, in advance of the debate, to what exactly is the position they wish to advance at the debate. In the present case, it appeared to me, that counsel for the defenders, from time to time at least, had some difficulty in informing the Court exactly what position he was adopting in relation to the prescription plea. Some of that difficulty might have been reduced had a note of argument, clearly focussing the defenders' position, been prepared and lodged before the debate.

The letters just referred to are respectively Nos.6/2 and 6/3 of process. It is a matter of admission that between 19 November 1996 and 31 December 2002, when the pursuer's employment with the defenders came to an end, he was never enrolled by either Tele Data Limited or the defenders in the Scottish Power Pension Scheme and that no contribution to any pension scheme was made on his behalf by Tele Data Limited or the defenders. Nor for that matter were any deductions made from his salary in respect of pension contributions.

Schedule 1, para.1(g) of the Act provides that section 6 will apply "to any obligation arising from, or by reason of any breach of, a contract or promise, not being an obligation falling within any other provision of this paragraph".

Section 11(1) provides:

The provisions of section 11(2), it was submitted, would not, however, have any application to the one off failure by the defenders' predecessors to enrol the pursuer in the relevant pension scheme in November 1996. They could only apply, if at all, to a continuing obligation to make employer's contributions to the scheme. At this point, however, counsel for the defenders, suggested that the pursuer could probably have been enrolled in the scheme right up until his contract of employment terminated in 2002 and that a payment could have been made, at that stage, to represent the amount of contributions which should have been paid from November 1996. Had that occurred, however, that would simply, it was said, be "compensation" for the breach of contract which occurred in November 1996 and did not demonstrate that the obligation in question had not prescribed in November 2001. Section 11(2), it was submitted, was meant to cover cases like nuisance. It did not cover the breach of an obligation to do something within a specified time. Such a failure did not amount to a continuing breach. Counsel referred me to the provisions of Schedule 2 of the 1973 Act which, he submitted, made provision for certain kinds of continuing relationship, into which the present case did not fall. Had the pursuer nominated a private pension scheme, the breach of the defenders and their predecessors would have been the failure to make the necessary contributions into the pension scheme in question. It was difficult to see why the commencement of the breach should be postponed to the end of the contract of employment.

This passage follows on from the discussion by the writer of English cases in relation to the law on limitation in that jurisdiction regarding omissions where there is no duty to act before a certain date. It is observed by the writer, at para.4.58:

The writer then reviews Scottish cases in which such issues have been aired and at para.4.63 states:

Senior counsel for the pursuer maintained that, for the time being, at least, it was sufficient for him to contend that the provisions of section 11(2) were apt to cover the present situation or, at least, that their application could not be ruled out without further inquiry into the facts. The pursuer sought to prove that the defenders, and their predecessors, had been guilty of a continuing act of default under the terms of the contract of employment. Senior counsel referred me to the Scots case of Ferguson v Maclennan 1991 S.L.T.321 and the English case of Midland Bank Trust Co Ltd v Hett Stubbs & Kemp (1979) Ch.384, both of which are discussed by Johnston on Prescription and Limitation and, which, it was said, illustrated the proposition that prescription should not begin to run in relation to an omission to act until the loss became irredeemable.