Scottish Court of Session Decisions

Pursuer: Casey, Advocate; Thompsons

Defenders: Watson, Solicitor-Advocate; Simpson & Marwick

6 October 2011

Introduction

[1] In this action of damages relating to costs incurred by the pursuer after a road traffic accident parties agreed settlement by way of minutes of tender and of acceptance for £2500. Parties remain in dispute on the question of expenses. The pursuer, for whom Miss Casey appeared, seeks Court of Session expenses and certification of Mr Charles Welsh and Mr Kenneth Perry under Rule 43.13.(2) and (3) as skilled witnesses whom it was reasonable to employ to make investigations and report. The defenders, for whom Mr Watson appeared, contend that expenses should be modified in terms of Rule 42.5(1) and should be awarded only on the Sheriff Court Summary Cause Scale without sanction for the employment of counsel, failing which on the Sheriff Court Ordinary Cause Scale without sanction for counsel, and that certification of the witnesses should be refused.

[2] On 20 September 2008 a vehicle being driven by the defenders' insured collided with the pursuer's parked and unattended Land Rover Discovery motor car. The pursuer's car sustained extensive damage and required to be repaired. The pursuer entered into a credit hire agreement with Accident Exchange Limited who arranged for his car to be inspected by an engineer and for repairs to be carried out and they provided the pursuer with a replacement car. The pursuer is contractually obliged to pay to Accident Exchange Limited the cost of the repairs and the cost of the engineer's report and to meet the cost of hiring the replacement vehicle, including credit hire rates. It is apparent from the productions that the pursuer hired a vehicle from Accident Exchange Limited for 31 days and was liable to them for £9623.80. The pursuer's car suffered some diminution of value.

[3] The summons, which concluded for damages of £12000 together with interest, was signetted on 29 June 2009. For reasons which were not explained, it was not served on the defenders until April 2010. By that time, the defenders had paid £1392.50 in full settlement of the head of claim for diminution of value; £2115.78 being the cost of repairs; £58.75 for the engineer's report and £2275.28 towards the cost of the hire. Given what had been paid, and deducting it from the sum concluded for in the summons, the outstanding sum being sought was £6157.69. The residual heads of claim were the balance of replacement car hire charges and a claim for inconvenience.

[4] Proof was set down for four days commencing on 28 June 2011. Liability was not in dispute and had the case gone to proof the dispute would have related to quantum, primarily on the issue of whether the pursuer was entitled to recover the full cost of hire from a credit car hire company which offers additional benefits and may therefore be more expensive than an ordinary car hire. In the event that the pursuer was not "impecunious" in the sense explained by the House of Lords in Lagden v O'Connor [2004] 1 AC 1067, the issue would have been what the appropriate "spot-rate" was for car hire and for what period. On record the pursuer avers in response to a call in the answers to condescendence 4 that it was "admitted that the pursuer is not absolutely impecunious".

[5] The defenders tendered in the sum of £2500 on 28 June 2011 which tender the pursuer decided to accept on the morning of the first day of the proof when it became apparent that the proof would be unlikely to be able to proceed, essentially because of a lack of preparedness on the part of the defenders caused by late intimation of witnesses by the pursuer and limitations in his pleadings. The defenders were also seeking to add a witness at a late stage. The proof was discharged and the case called by order the next day at which time the pursuer lodged a minute of acceptance of tender. Parties addressed me on issues relating to expenses and certification of witnesses.

Submissions for the defenders
[6] Mr Watson founded on McKenzie v H D Fraser and Sons 1990 SC 311 to vouch that, even having regard to the terms of the tender, the question of expenses was for the court to determine in the exercise of its discretion. That was not a matter of dispute between parties.

[7] Mr Watson referred to McIntosh v British Railways Board 1990 SC 338, Coyle v William Fairey Installations Ltd 1991 SC 16, Gordon v Strathclyde Buses Ltd 1995 SLT 1019 and Hylands v Glasgow City Council 2008 SLT 988. The opinion of the court, delivered by the Lord President in McIntosh, confirmed that whilst a pursuer may choose to raise an action in whichever court he finds more convenient or appropriate to his own circumstances, his choice of the Court of Session may cause his expenses to be modified if the sum he recovers is small. Mr Watson submitted that the true dominus litis in these proceedings was Accident Exchange Limited whom he perceived wished to develop a body of Court of Session case law. They were entitled to choose this forum, but did so at risk of modification of their expenses.

[8] The proper approach to the question of expenses in the situation which had developed was described by Lord Morison in Coyle in delivering the opinion of an Extra Division. Illustrations of the application of this approach could be seen in Hylands and also in Gordon.

[9] So far as the case of Hylands was concerned, Mr Watson pointed out that there was a speciality in that the summons had been signetted just before the increase in the privative limit but was served afterwards. He noted that but for that speciality, Lord Drummond Young would have awarded expenses on the summary cause scale without sanction for counsel where a tender of £2500 had been accepted. Mr Watson noted Lord Drummond Young's analysis in Hylands of a number of Chapter 43 cases and pointed out that this was an ordinary action which could not proceed under Chapter 43.

[10] Mr Watson founded particularly on Gordon. The conclusion reached by Lord Cameron in the following passage was the view which the court should come to in this case.

"Looking to the nature of the pleadings in this case I can find nothing in the issues of fact or of law raised in them which could properly be said to justify recourse to the Court of Session for their determination. Indeed there is nothing of the kind of difficulty of pleading which might require the assistance of counsel."

[11] This was a low value claim with no factual or legal complexities such as would justify raising the action in the Court of Session or the instruction of counsel. When those heads of loss which the pursuer averred had been paid were deducted, the residual sum sued for was £6157.69. Whilst this exceeded the privative jurisdiction of £5000, the pursuer had compromised his claim for £2500. The pursuer's case was that the questions of part of the hire charges and inconvenience remained outstanding between the parties and the defenders' position was that both the hire period and the charges were excessive. The issue in this case was 'the stock in trade of sheriff courts up and down the country', placing a value on a factual dispute.

[12] Mr Watson acknowledged that in a case of this kind it was appropriate to provide the court with evidence of spot-rates for car hire. He submitted that that might be done by an unskilled person collating information or by the production of car rental website print-offs and a joint minute. However, there was no expertise applied by Mr Perry in this case. Mr Watson referred to Rule 42.13(2). The rule contained three requirements: first that it was reasonable to employ a skilled person; secondly that the person was skilled; thirdly, there must have been investigations or reporting. He referred to No. 6/4 of process, headed 'Witness Statement of Kenneth Perry'. This document contained a brief statement by Mr Perry in which he explained that he is employed by APU Ltd who own and operate a software programme called "Spot Rate Check" which is underpinned by a database of spot-hire quotes which have been obtained from the internet websites of rental companies since 2009 and that this data is open to solicitors who can register to use the service. The second document in 6/4 of process is headed "Spot Rate Check - Local Spot Rate Report and Statement" bearing user name and company as Laura McGee, Thompsons. This was simply a collation of factual information and Mr Perry had not brought to bear any skill or expertise on it. It could not be said that he had been employed to make investigations or report as required by the rule. Consulting with Miss Casey would not amount to reporting or investigating for the purposes of the rule.

[13] So far as the report of Mr Welsh was concerned, this related to a matter in which settlement had been made before litigation commenced. Whilst he accepted that any question of reasonableness of instruction had to be assessed in the light of the knowledge and state of affairs subsisting at the time when the instruction was given, the parties had never been in dispute about the question of diminution of value once the summons had been served on the defenders. Diminution in value of the pursuer's motor car played no part in the process before the court. The pursuer could have sought to recover the cost of Mr Welsh's report by including it as a head of loss as had been done with the engineer's fee as could be seen at page 8C-D of the record.

Submissions for the pursuer

[14] Ms Casey founded on Hylands, McIntosh, and Coyle. It was her position that the pursuer had a right to choose the Court of Session as the forum for this action if he found it convenient or appropriate to his circumstances. Accident Exchange Limited found it to be convenient to litigate in Edinburgh and were interested in developing a body of case law in the Court of Session. I would observe that this submission rather confirmed Mr Watson's perception of the role of Accident Exchange Limited in the proceedings.

[15] Miss Casey also founded on Lord Morison's opinion in Coyle, particularly a passage at page 19:

"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 grounds that the value of the claim was not commensurate with Court of Session expenses. For example, a pursuer might well agree to a settlement at a figure 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."

[16] In the present case, the pursuer was seeking damages at a level in excess of the privative jurisdiction and whilst acceptance of the tender for £2500 required to be taken into account, not too much weight should be put on that factor as this was a commercial settlement. The level of recovery was not conclusive. Miss Casey submitted that this was a case of some factual and legal complexity and it was appropriately raised in the Court of Session. She was unable to expand upon that last submission and did not specify where the difficulty lay in this case. Miss Casey offered some indication of the rates of hire which both sides might have been in a position to found on, but Mr Watson had accepted that the court was not able to determine what would have been awarded after proof.

[17] Miss Casey submitted that the information provided by Mr Perry in his report was beyond the knowledge of an ordinary person and involved the application of specialist knowledge. As to his expertise, all that she was able to say was that he had been in his current job for a number of years, but less than five years. The input of data into his programme had been performed by skilled persons. Mr Perry would be able to interpret the database in a way which was not open to an ordinary person. When a report had been intimated by the defenders, Mr Perry had considered it and had carried out further investigations as to availability of cars for hire in Aberdeen and he would have been able to supplement the terms of his report in evidence. He had assisted Miss Casey to understand the factual issues.

[18] Mr Welsh was a motor engineer assessor and had been employed to provide evidence of diminution of value to the pursuer's motor car following the accident. He had not been cited to attend court and the application related to his reporting. He was instructed in June 2009 and it was only in July 2009 when the defenders offered settlement of that head of the claim.

Discussion

[19] The Rules of the Court of Session 1994 state in Rule 42.13

"42.13 - Charges for witnesses

...

'(2) Subject to paragraph (3), where it is reasonable in any cause to employ a skilled person to make investigations or to report for any purpose, any charges for such investigations and report and for any attendance at any proof or jury trial shall be allowed in addition to the ordinary witness fee of such person at such rate as the Auditor shall determine is fair and reasonable.

...

(3) The Auditor may make no determination under paragraph (2) or (2A) unless the court has, on granting a motion made for the purpose, before or at the time at which it awarded expenses or on a motion enrolled at any time thereafter but before the diet of taxation - (a) certified that the witness was a skilled witness; (aa) certified that it was reasonable to employ that person to make investigations or to report; and (b) recorded the name of that witness in the interlocutor pronounced by the court. ...

42.16

Chapter II

(1) Where it was reasonable to employ a skilled person to make investigations or to report for any purpose, any charges for such investigations and report and for any attendance at any proof or jury trial shall be allowed at a rate which the Auditor of Court shall determine is fair and reasonable.' "

[20] The effect of these provisions was considered by Lord Hodge, in a case to which I was not referred, J A McClelland & Sons (Auctioneers) Ltd v I R Robertson & Partners Ltd 2009 SLT 531. In paragraphs 7-14 of his opinion he set out a brief history of the approach taken over time in different incarnations of the rules and in the practice of the court. In paragraph 9 he concluded that the skilled person must be a witness if he or she is to be certified in terms of Rule 42.13(2). In J A McLelland, the skilled person under consideration was never intended to be a witness and so certification was not competent, but Lord Hodge noted in paragraph 12 that this did not prevent the Auditor from determining whether the cost of the skilled person's services was an appropriate outlay in the preparation of the case on the basis of the practice of the court explained in the cases which he there referred to, including Clements v Corporation of Edinburgh (1905) 7 F 651 where the Lord Justice Clerk, with whom three other judges of the Second Division agreed, had stated:

"So, I think that this case is altogether outside the Act of Sederunt, and that no certificate is required when the case has been settled before going to trial. When the case is settled on the footing that the pursuer is to get his expenses, I think any question as to what such expenses include falls to be decided according to the ordinary practice of the Court, with the assistance of the Auditor, and that the pursuer will be entitled to get his ordinary and proper charges according to the circumstances of the case."

Lord Hodge also suggested, in paragraph 13, that paragraph 1 of Chapter II of the table of fees may provide a basis within the table of fees for allowing fair and reasonable charges to a skilled person who is not a witness and accordingly not certified as such.

[21] Whilst the name of Mr Welsh was included in the pursuer's list of witnesses, he was not cited and was not going to be called as a witness had the case proceeded to proof. The matter about which he had reported, diminution in value of the pursuer's car after the accident, was settled by a payment from the defenders to the pursuer before the summons was served. In the particular circumstances of this case, I conclude that he is not a witness covered by Rule 43.13(2) and I cannot certify him as such. As Lord Hodge's analysis demonstrates, this does not necessarily mean that the cost of his report cannot be recovered, but it is a matter for the Auditor to determine.

[22] Curiously, given that the period of hire was 31 days, the information collated in No. 6/4 of process related only to hire periods of between 7 and 28 days, as that appears to be the extent of the information held in the APU database. Mr Perry was cited as a witness and would probably have been called had the proof proceeded. It was conceded that it was reasonable to make available to the court information of the sort collated in his report. It might have assisted the court up to a point, but it was simply factual information. Mr Watson's real complaint related to whether, if Mr Perry could be taken to have investigated or reported, he had exercised any skill in doing so. Beyond saying that she understood that Mr Perry had held his job for almost five years, Miss Casey did not provide any detail as to Mr Perry's qualifications or expertise and none is to be found in No. 6/4 of process. Miss Casey was not able to explain what skill he had brought to bear in the preparation of that document or what expertise he would have provided to the court had he given evidence. In these circumstances, I have not been provided with material which would allow me to conclude that Mr Perry exercised skill in connection with the creation of the report or that he would have been a skilled witness in the proof. I do not consider that his ability to explain technical matters to counsel renders him a skilled witness in terms of the rule. Accordingly I am unable to certify in terms of Rule 42.13(2).

[23] The pursuer, or perhaps in this case the dominus litis, was entitled to choose the Court of Session as his preferred forum (McIntosh), but he did so at risk of his expenses being modified in the event of success (McIntosh, Coyle, Hylands).

[24] Having considered the pleadings and the submissions made on either side, I cannot identify any real difficulty of fact or law which would justify raising the action in the Court of Session or the employment of counsel. It remains to determine whether it could be said that upon a reasonable and proper assessment of the value of the case at the time of the action being raised it should have been raised as a Summary Cause Sheriff Court action. The approach of Lord Drummond Young in Hylands might suggest that it should.

[25] However, even though the case settled for £2500, well below the summary cause threshold of £5000 and indeed within the small claims limit of £3000, that consideration, though relevant, is not necessarily decisive. I am not in a position to determine that the pursuer could never have been awarded more than £5000 in this action, although that might have been difficult given the concession that the pursuer was not "absolutely impecunious". I note that once the summons had been signetted, there were subsequent payments and agreements which reduced the value of the claim. It may not have been attractive to abandon the work which had been done and start proceedings again in the Sheriff Court. I also have the impression that the pursuer, or at least Accident Exchange Limited, intended that this case should proceed to proof and that the prospect of discharge and a further diet of proof was a significant factor in the decision to accept the defenders' tender. I recognise that the pursuer, or his representatives, may bear blame for that.

Decision

[26] I shall give effect to the minutes of tender and acceptance and decern in terms thereof. Having regard to the whole circumstances, I shall award the pursuer expenses to the date of tender modified to the scale suitable to an ordinary cause in the Sheriff Court, but without sanction for the employment of counsel.

[27] For the reasons which I have given, I am unable to certify Mr Perry and Mr Welsh in terms of Rule 42.13(2).