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OUTER HOUSE, COURT OF SESSION
[2008] CSOH 155
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A714/07
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OPINION OF LORD BRODIE
in the cause
GILLIES BROWN
Pursuer;
against
JAMES WEST STEWART
&c
Defender:
ญญญญญญญญญญญญญญญญญ________________
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Pursuer: Godden, Solicitor Advocate; McKay
& Norwell, Solicitors
Second Defender: Party
12 November 2008
The Action
[1] In this action the pursuer
concludes:-
"1. For production and reduction of the
Disposition by James West Stewart and Margaret Stewart in favour
of Margaret Stewart and her Assignees, Disponees and Executors of ALL and
WHOLE the subjects forming and known as 27 West End, Kinglassie,
Fife, KY5 OXG"
and:-
"3. For an order
ordaining the Keeper of The Registers of Scotland to rectify the inaccuracies
in the Land Register for the County of Fife in respect of the Subjects
(FFE64534) arising from and following decree of reduction as first concluded
for by deleting in its entirety the entry in the proprietorship section and
substituting 'JAMES WEST STEWART and MARGARET STEWART, both 27 West End,
Kinglassie, equally between them' therefore.
The pursuer avers that he is
entitled to these remedies because the Disposition referred to in the first
conclusion was an alienation by a debtor which is challengeable at the instance
of his creditor in terms of section 34(1) of the Bankruptcy (Scotland) Act 1985.
[2] The
pursuer further avers that on 28 November 2002
the first defender (James West Stewart) seriously assaulted him. On 25 May 2005
the pursuer's agents wrote to the first defender calling upon him to make
reparation in respect of the assault and warning him that if he failed to admit
liability court proceedings would be raised against him. At that time the first defender and the
second defender (Margaret Stewart) each owned a one half pro indiviso share in the property at
27 West End, Kinglassie. Having received the letter from the pursuer's
agents, the first defender transferred his one half pro indiviso share in the property to the second defender for no
consideration in terms of the Disposition referred to in the first
conclusion. On 18 April 2006, in the Sheriff
Court, the pursuer was awarded decree against the
first defender in the sum of ฃ32,433.33 plus interest and expenses, all in
terms of extract decree dated 4 May 2006. The first defender failed to make
payment. Following the service of a
charge the first defender was sequestrated on 1 December 2006. The third defender called in the action is
the first defender's Permanent Trustee.
[3] The
summons in the action was signetted on 2 November 2007. The first and second defenders entered
appearance but only the second defender lodged defences. The Open Record was lodged on 20 December 2007. On 8 February 2008
the cause was sisted on the unopposed motion of the second defender to allow
her to apply for legal aid. The sist was
recalled on the 12 February 2008
to allow the pursuer to amend and to apply for interim interdict. The cause was sisted of new on 4 March 2008. The sist was recalled on 29 April 2008 when the cause was
restored to the Adjustment Roll. The
record closed on 16 July 2008.
Motion for decree
[4] The cause called before me
By Order on 14 October 2008. The pursuer was represented by
Mr Godden, Solicitor Advocate. The
second defender appeared in person.
Mr Godden explained that he was seeking decree by default in terms
of the first and third conclusions because the second defender's agent had
withdrawn from acting, an interlocutor ordaining her to intimate the Deputy
Principal Clerk whether she intended to proceed with her defence to the action
had been served on her in terms of Rule of Court 30.2 and she had failed to so
intimate within the period of 14 days after service of the notice. The second defender did not dispute that she
had received the notice, albeit she had only been able to contact her solicitor
recently and that, although she wished to be represented she was not
represented. Her further response was
that the facts averred in the pleadings were wrong. It was not the case that the first defender
had transferred their house into her name in order to avoid paying compensation
to the pursuer. Rather, she and her
husband had been under quite a lot of strain at the relevant time and had
separated. In these circumstances he had
transferred his interest in their house to her.
They had, however, now resumed living together but had "never got round
to changing it back into both their names".
[5] From
the information provided by Mr Godden and the second defender it appeared
that the second defender did not have the benefit of a legal aid certificate
and this was the reason why the Edinburgh
agents had withdrawn from acting after some activity in the present action. However, the second defender had retained
contact, on some professional basis, with her local solicitors, Messrs Baird & Company,
and in particular, Mr MacDonald of that firm. In response to the notice served in terms of Rule
of Court 30.2(2) requiring the second defender to intimate whether she intended
to proceed, Messrs Baird & Company had written in terms of
letter dated 14 August 2008 advising that it was their Edinburgh
correspondents who had withdrawn from acting and that they were currently
looking for another firm to represent the second defender's interests. As Mr Godden observed, that was not a
response to the notice, but it did indicate that the second defender had some
prospect of obtaining legal representation.
She had confirmed that she wished to be represented and that it was not
her preference to represent herself. In
the circumstances it appeared to me appropriate to continue the By Order
hearing for a period of two weeks and in so doing, continue consideration of
Mr Godden's motion, made at bar, for decree in terms of the first and
third conclusions. I indicated to the
second defender that, on the basis of what I had heard, I was minded to grant
the motion but I wished that she have additional time to obtain legal
representation, which I understood to be her wish.
[6] The
continued By Order hearing took place on 29 October 2008. Mr Godden again appeared. The second defender attended but she was
again unrepresented. The first defender
was also in Court. I enquired of the
second defender whether she would wish to have her husband sitting with her at
the bar in order to provide assistance but she stated that this was
unnecessary.
[7] When
Mr Godden confirmed that he wished to insist in his motion I requested
that he rehearse the whole circumstances on which he relied in order that I and
the second defender should fully understand the basis for his application. He drew my attention to the nature of the
action, which I have summarised above.
He advised that, as appeared from the interlocutors, the cause had been
sisted on 8 February 2008
in order to allow the second defender to apply for legal aid. Legal aid was refused on 29 February 2008. He had been advised that the second
defender's then Edinburgh agents
had applied to the Scottish Legal Aid Board for a review of that decision. He assumed that that application for a review
had been unsuccessful. The sist was
recalled on 29 April 2008,
again as appeared from the interlocutors.
On 1 May 2008
the second defender made a further application for legal aid. No decision had been made on that second
application by the end of the adjustment period on 16 July 2008. The case came out By Order on 6 August 2008. Immediately before that a motion had been
made by the pursuer in terms of Rule Of Court 30.2(1) for the Court to
pronounce an interlocutor ordaining the second defender, whose Edinburgh agents
had by then withdrawn from acting, to intimate to the Deputy Principal Clerk
within 14 days whether or not she intended to proceed with the defence to
the action. On 15 August 2008 the second defender's
second legal aid application was refused. No application was made for review. No intimation had been received in response
to the notice served in terms of Rule of Court 30.2(2). It was in that state of affairs that a motion
for decree in terms of the first and third conclusions of the summons had been
made when the case had come before me By Order on 14 October 2008. Between then and the continued By Order roll
hearing, the pursuer's agents had received a letter from Messrs Baird & Company
dated 27 October 2008 in these terms:-
"We refer to
previous correspondence regarding the above.
We simply write
to advise you that Mrs Stewart has submitted an application to the
Scottish Legal Aid Board for Legal Aid to enable her to judicially review the
Scottish Legal Aid Board's refusal to grant Legal Aid in the action at the
instance of your client. The Scottish
Legal Aid Board have taken the view that she is financially ineligible for
Legal Aid as they insist on aggregating her husband's resources with hers
notwithstanding his contrary interest.
We would be grateful if you would note the position."
Mr Godden described this as a
curious letter. The first defender was an
undischarged bankrupt. It was difficult
to see what "resources" he might have which might be aggregated with the second
defender's resources. Moreover it was
difficult to understand what was meant by "his contrary interest". To delay the present proceedings to await the
outcome of this new application for Legal Aid and possible proceedings for
judicial review would be unfair on the pursuer.
In conclusion, Mr Godden reminded me of what had been said by the
second defender on 14 October 2008. She had then said that what appeared in the
pleadings was wrong. It had not been her
intention to defeat the decree against her husband. The actual reason for the conveyance was that
she and her husband were under pressure and had separated and in these
circumstances the first defender had generously transferred his interests in
the house to her. They were back
together again and had simply not got round to transfer the title back into
joint names. If that was so, said
Mr Godden, it was difficult to see where was the prejudice in the
Disposition being reduced as first concluded for and a consequential order made
as third concluded for.
[8] The
second defender explained that she had only succeeded in contacting
Mr MacDonald recently because he had been away on holiday. It would not be in her interests for the
Court to grant decree of reduction. She
would be homeless. She had not thought
that the pursuer would succeed in his action in the Sheriff
Court. The
transfer of the title had occurred when she and her husband had split up and no
consideration had been given to defeating the pursuer's claims. However, if the title reverted to being in
their joint names the pursuer would try to sell the house in order to get the
money he thinks he is due. She
appreciated that she could not go back to the original Sheriff
Court action, although it had been "a wee bit of a
travesty". The pursuer should not have
been awarded anything. She had recently
received a letter from Mr MacDonald but there was nothing in that letter
which she wished to draw to my attention.
She wished a further continuation in order to get an answer from the Scottish
Legal Aid Board one way or another. She
had nothing to say in particular in response to Mr Godden's motion for
expenses in the event that decree was granted.
Decision
[9] The second defender's Edinburgh
agents have withdrawn from acting.
Mr Godden described her local agents, Messrs Baird &
Company, as "hovering" but they have not instructed alternative Edinburgh
agents. Nor, as Mr Godden pointed
out, have they responded on behalf of the second defender to the notice served
on the second defender in terms of Rule of Court 30.2(2). No more has the second defender herself. The reason why the second defender does not
have representation appears to be because she has been twice refused legal
aid. I agree with Mr Godden that
the explanation given for the refusals of legal aid in the letter from Messrs Baird & Company
dated 27 October 2008
is rather difficult to follow. It is
also very brief and uninformative. No
mention is made as to whether the Scottish Legal Aid Board has taken a position
on the issue of probalis causa. This is in a situation where for all that
appears in the pleadings and for anything said to me by the second defender,
she has no defence to decree in terms of the first and third conclusions.
[10] This is a situation where Rule of Court 30.3 applies. The rule is in the following terms:-
"where a party
on whom a notice has been served under rule 30.2(2) fails to intimate to
the Deputy Principal Clerk within the period specified in the notice that he
intends to proceed, the Court shall, on the motion of any other party where a
certificate of service of the notice has been lodged in process, grant such
decree, order or finding as it thinks fit".
The effect of the second defender's
failure, which remains unexplained either by her or by anything that appears in
any letter from Baird & Company, is that I am required to
exercise a discretion as to what order it should now be pronounced. Mr Godden, on behalf of the pursuer, has
moved me to grant decree. The second
defender has moved me to further continue the matter, for some undefined
period, to await the decision of the Scottish Legal Aid Board on her
application for legal aid in order to present an application for judicial
review against the decisions of the Scottish Legal Aid Board or one or other of
them to refuse her legal aid to defend the present action. In all the circumstances I consider it
appropriate to grant the pursuer's motion and accordingly I shall pronounce
decree against the second defender in terms of the first and third conclusions
of the summons. What it appears to me to
be relevant in the exercise of my discretion is as follows. This action was commenced nearly a year
ago. In the period which has followed the
second defender has had ample opportunity both to apply for legal aid, if her
means and the availability of any defence justify a grant of legal aid, and she
has had ample opportunity to place on record such a defence as she may have to
the conclusions directed against her title.
She has been refused legal aid on two occasions. She has succeeded in retaining local
solicitors but they, perhaps due to difficulty over funding, have chosen to do
little. These solicitors have advised that
the second defender submitted an application to the Scottish Legal Aid Board
for legal aid for judicial review proceedings.
They have not, however, said when that application was submitted and
they have not chosen to explain, in anyway that is readily comprehensible, why
it is thought that the second defender would have probable cause in relation to
an application for judicial review. The
record in the action has been allowed to close without any substantive defence
being pled. Thus, the second defender is
in default, for a reason that is not explained, in circumstances where little
has been done in the action on her behalf beyond lodging skeletal defences
which do not, or at least not in a readily comprehensible and candid way,
disclose a defence. The explanation for
this may include the fact that the second defender has not obtained legal aid
and either does not have an alternative source of funding for her defence of
the action or does not choose to draw on such source of funding. It is not clear why that should prevent the
pursuer obtaining the remedies which, on the face of the pleadings, he would
appear to be entitled to. It did not
appear to me to be proper to grant decree on 14 October 2008 without giving the second
defender a final opportunity to obtain legal advice and representation. Notwithstanding what might be regarded as a
situation of crisis effectively nothing appears to have been done in the last
two weeks. Nothing was promised for the
future beyond awaiting for the decision of the Scottish Legal Aid Board on what
would be an application in relation to other proceedings, the prospects of
which I am unable to make a judgement upon because I have not been provided
with sufficient information.
[11] I find the second defender liable to the pursuer in the expense
of the action insofar as expenses have not been otherwise dealt with.
