Scottish Court of Session Decisions

"The procedure in a commercial action, so far as not regulated by the provisions of Chapter 47, is at the discretion of the commercial judge: it shall be such as he shall order or direct ... In the exercise of the discretion the commercial judge will ordinarily be guided by considerations of justice, efficiency, expedition and economy."

I was also referred to Stirling Aquatic Technology Ltd v Farmocean AB 1993 S.L.T. 713 at 715K/L. However, senior counsel emphasised that a dispute may be wider than first appears, and that all that was stated in Stirling Aquatic was that one of the principal objects of the procedure on the commercial roll was to enable disputes of a business or commercial nature to be dealt with as quickly as possible - there may be complex disputes in which a very speedy disposal is simply impossible in the circumstances. There was nothing in the content of this action, or in the Rules of Court, which should cause the court to change the way in which it would view a motion for a third party notice in other types of action; courts had expressed themselves strongly in favour of the utility of the third party notice procedure where it allowed the court to dispose of a dispute between several parties in the course of one action. The test to be applied by the court in exercising its discretion whether or not to grant a motion for service of a third party notice is simply whether or not it would be in the interests of justice to allow the third party notice to be served - see Macfadyen, op. cit., at page E/806, para.[811]. I was also referred to Note 26.1.1 in the Rules of Court and to Maxwell on The Practice of the Court of Session at pages 233-235.

"There are many obvious advantages in such a procedure. Apart from the saving of expense and time and the prevention of delay, it is clearly desirable that, where there has to be investigation into facts which are common to the inquiries into liability and the related rights of contribution, relief and indemnity, the investigation should be by one inquiry."

I was also referred to Rodgers v Crow & Sons 1971 S.C. 155; Tait v Leslie and Saddler Limited 1971 S.L.T. (Notes) 79; Buchan v Thomson 1976 S.L.T. 42; Nimmo's Executor v White's Executors 1976 S.L.T. 70; Anderson v Anderson 1981 S.L.T. 271; and Halbert v British Airports Authority plc 1996 S.L.T. 97.

(1) This was a high value, complex action which would take a considerable time to process in any event. Certain complex aspects of the claim had not been intimated to the defenders in advance, so additional time would be required to enable these to be properly investigated. Although there would be some additional delay caused by the introduction of these third parties, this would not be disproportionate in the circumstances.

(2) If third party notices are not allowed, this would inevitably lead to actions for contribution or relief. The same complex points would require to be litigated again. Two separate actions would be necessary, the first against the first, second and third third parties, and the second against the fourth third party. This would result in significant delay in the defenders obtaining any relief, and there could be no progress in those actions until the present action had proceeded to decree.

(3) There would be a significant risk of prejudice if the legal and/or factual issues were viewed differently by different tribunals. The matter would not be res judicata, and this could lead to substantial injustice.

(4) In fairness to the third parties, and to enable the court to be as fully informed as possible on the issues, it was appropriate that the third parties were represented on the common issues, and on the question of quantum.

(5) This was a case where, on the pursuers' own averments, a contribution factor would be necessary (the pursuers having already made averments of breaches of contract et separatim fault and negligence on the part of Odeon in carrying out the tenant's works).

(6) If the first defenders were wrong in their argument about pro rata responsibility under the supplemental agreement, they might be obliged to pay for the pursuers' whole loss, which could be very large, even if their share of the responsibility was low.

(7) If the third parties were not convened, it would make it more difficult to achieve an extrajudicial settlement of the dispute, (a) because all relevant parties would not be involved and would not be aware of information as it became available, and (b) because it would be more difficult for the defenders to settle the action, as any decisions which they took based on their assessment of the prospects of success or on quantum could be subject to challenge in the actions for relief.

(8) The timing of the application for third party notices favoured their grant. The defenders have lodged defences timeously, and have included in these defences at the earliest possible moment reasonably developed arguments against the third parties. This has enabled the issue to be raised at the first possible moment, at the preliminary hearing, thereby minimising any delay consequent on the third party notice procedure.

"... clearly the service of a third party notice would be of advantage not only to the speedy determination of the whole dispute, but in the interests of justice between the parties."

Lord Migdale's observation that he did not like the idea of refusing to order a third party notice before he knew what the third party was going to say was highly questionable, and if Lord Cameron was suggesting that there was a right conferred by the Rules of Court on a defender to bring in a third party this was wrong. While the interests of justice between the parties remain important, in commercial causes the wider interests of justice require to be considered. At the forefront of these was speedy disposal of the action. When asked by the court which had a higher priority, senior counsel conceded that the interests of justice must come first, but that a speedy disposal of the action is a very desirable second.