Scottish Court of Session Decisions

OUTER HOUSE, COURT OF SESSION [2011] CSOH 177
A789/06	OPINION OF LORD MATTHEWS in the cause JAMES PERCY Pursuer; against GOVAN INITIATIVE LIMITED Defender: ­­­­­­­­­­­­­­­­­________________

Pursuer: Party

Defender: McKenzie; Simpson & Marwick, Solicitors

21 October 2011

Introduction

[1] In this case the pursuer seeks payment by the defenders of the sum of £250,000 sterling, with interest, as a result of what he claims are certain breaches of duty on the part of their employees. Very broadly speaking the pursuer claims that in and around 2001 he decided to commence a stone masonry business, having identified a market for such a business in Scotland. To assist him in achieving this he sought the help of the defenders who provide advice to individuals and organisations in relation to proposed business ventures. It is averred that a Mr George Smith of the defenders gave him advice from August 2001 until December 2001 and then handed the pursuer over to a Mr Anthony Massot, another employee of the defenders. This was because of a conflict of interest, the details of which are of no significance. Mr Massot, it is said, confirmed in December 2001 that he would be happy to prepare a business plan while the pursuer gathered letters from potential clients. It is averred that in the first week of January 2002 the defender gave the pursuer "a signed contract of a duty of care during the period of his involvement". The defenders are said to have brought in an accountant from Campbell Dallas, Accountants on 13 and 21 February 2002. It is averred that they knew the granite business and confirmed the pursuer's profit margin and that "the pursuer held over 35 signed letters of contract." The defender is said to have told the pursuer to deal with a company in England called Lister Madusa as that would help to keep British jobs and that "we would get every piece of help needed". Condescendence II continues as follows:

"The pursuer told the defender that would not work and the pursuer proved right, the contracts (sic) is worth over one million pounds. The pursuer had further meetings with Mr Massot on 13th and 21st February, 1st, 7th of March and was told to go and open the doors for business as loans will be with us 4 to 6 weeks, also on the 28th of March, 3rd April, 9th May, 12th and 21st June, 9th and 26th July, 5th, 12th and 13th September, 29th October, 27th November. Also the pursuer had meetings with the Scottish Executive Enterprise Investigation Team and a phone call to the pursuer's house by Mr Jack Perry say that he heard a different story from the truth that the pursuer gave him on the phone. Mr Perry arranged a meeting with Mr Charles Wood and his board members, including Sir John Ward. In the course of the earlier meetings Mr Massot undertook to provide the pursuer with assistance in respect of incorporating a company, the preparation of a suitable business plan and applications to funding agencies that provided assistance to start up businesses. Mr Massot also assisted in finding bankers, the Bank of Scotland, to act in respect of the business when incorporated. The pursuer was assisted in finding premises for the business by Mr Massot. These premises were situated at the Evans Business Centre, Units 13/14, 68-74 Queen Elizabeth Avenue, Hillington Industrial Estate, Glasgow, G52 4NQ. In or around November 2002 the pursuer required to relocate the business to premises at 38 Kelvin Avenue, Hillington, G52 4LT. When Mr Massot was advised by the pursuer he would be relocating the business, Mr Massot indicated that this would not present a difficulty".

[2] In answer, it is admitted that the pursuer had certain meetings with Mr Massot who worked for the defenders and that he provided certain assistance. The remainder of his averments are said to be not known and not admitted or are denied. Certain averments are made about what happened at a meeting between Mr Massot, the pursuer and Campbell Dallas and there are further averments about a meeting between a Jim O'Connor, Gateway Business Manager, Glasgow, his colleague Linda Gillespie and the pursuer in order to investigate the pursuer's concerns about his applications for funding to Glasgow City Council and Developing Strathclyde Limited. It is averred that Mr O'Connor reported his findings to the pursuer by letters dated 23 October 2003 and 18 March 2004 and that he concluded that while he regretted that the services provided to the pursuer had not been as productive as the pursuer would have wished, he was satisfied that this was not as a result of any fault or omissions on the part of Mr Massot. The pursuer is also called upon to produce a copy of the "contract of a duty of care" to which he refers.

[3] In Condescendence III the pursuer avers that on or about 22 May 2002 Mr Massot submitted an application to Glasgow City Council in respect of financial assistance in the sum of £10,000 from the West of Scotland Loan Fund. The application was processed until it transpired that the premises in respect of which the application was made fell outwith the boundary of Glasgow City Council. It goes on as follows:

"On or about 30th December 2002, Mr Massot visited the pursuer at the premises of his business with Cameron Ritchie of Scottish Enterprise, Renfrewshire, as the defender and in particular Mr Massot could no longer act on his behalf as the premises fell outwith the defender's catchment area. In fact neither of the premises from which the pursuer operated his business fell within the defenders catchment area despite the assurances of Mr Massot that he was the appropriate person to act on the pursuer's behalf. Reference is made to a report compiled by Mr Massot on 15 March, 2003, a copy of which is produced herewith and incorporated herein brevitatis causa. Further explained that by letter dated 21st February, 2005 the Chief Executive of Scottish Enterprise, Jack Perry wrote to the pursuer confirming that both premises occupied by the pursuer's businesses were outwith the defenders catchment area. The letter inter alia also acknowledged that the advice offered to the pursuer 'did not match the high standards we aim for'. A copy of the letter is produced herewith and referred to for its terms, which together with the enclosure referred to therein are incorporated herein brevitatis causa. In consequence of the advice offered by Mr Massot the pursuer has suffered loss and damage hereinafter condescended upon."

[4] In answer the defenders refer to Mr Massot's report and the letter from the Chief Executive for their terms. Quoad ultra the averments are said to be not known and not admitted.

[5] Condescendence IV reads as follows:

"The loss and damage suffered by the pursuer was caused by the fault of Anthony Massot for whose actings in the course of his employment with them the defender is responsible. Mr Massot in advising the pursuer owed him a duty of care. In particular, Mr Massot was under a duty to prevent the pursuer whether by act or omission from suffering loss. In acting on behalf of the pursuer as his business advisor in circumstances where he should not have done so and in failing to check whether he was so entitled to act prior to doing so he was in breach of that duty in consequence of which the pursuer has suffered loss."

This is met with a simple denial.

[6] Condescendence V runs as follows:

"As a result of Mr Massot's breach of duty the pursuer has suffered loss. In particular in consequence of the pursuer failing to secure loans he was unable to ensure his business could properly service an overdraft obtained from the Bank of Scotland. The pursuer granted personal guarantees in respect of the businesses' debts for which he is liable. Furthermore as a result of the mishandling of the business start up process the pursuer lost the opportunity to derive an income from the business. In the circumstances the sum sued for is a reasonable estimate of the pursuer's loss and damage."

This averment is met with a simple denial.

[7] The Closed Record was allowed to be received late on 11 July 2007 and the action was sisted to enable the pursuer's application for sanction to instruct an accountant to be determined by the Scottish Legal Aid Board. The sist was recalled on 12 May 2009 because the pursuer's solicitors were no longer acting for him. After sundry procedure the case was, on 16 December 2009, appointed to the Procedure Roll on the first and second pleas-in-law for the defenders. These are in the following terms:

"1 The pursuer's averments being irrelevant et separatim lacking in specification, the action should be dismissed.

2.     The pursuer's averments in relation to quantum being irrelevant et separatim lacking in specification, they should not be admitted to probation and the action dismissed."

[8] On 17 March 2010 the diet of Procedure Roll was discharged and the case put out By Order to enable the pursuer to take steps to secure legal representation. A further diet of Procedure Roll was discharged on 14 July 2010 and the pursuer was ordained to lodge a Minute of Amendment within eight weeks, with answers to be lodged within four weeks thereafter. The Minute of Amendment was allowed to be received late on 9 November 2010 and on 17 November 2010 the answers were allowed to be received at the bar of the court and four weeks for adjustment was allowed. The pursuer was ordained to lodge in process a legal aid certificate prior to the next calling of the case, which was on 17 December 2010. On that date the Closed Record was allowed to be opened up and was amended in terms of the Minute of Amendment and answers, both as adjusted, and the Record was closed of new. Lord Brailsford ordained the defenders to prepare the amended Closed Record and the pursuer was ordained to lodge a Certificate of Endorsement by 14 January 2010. The cause was once again appointed to the Procedure Roll for debate on the defenders' pleas-in-law and in due course it called before me for that purpose. Before I turn to the submissions proper I should say that the Record contains on pages 14, 15 and 16 a number of averments by the pursuer which I understand are contained in the Minute of Amendment or adjustments thereto. Mr McKenzie, who appeared for the defenders, advised me that when the defenders were ordained to make up the Record they could not understand where these averments were to be inserted. I decided nonetheless for the purposes of the debate to treat them as averments properly made. I will not refer to them in detail at this stage since Mr Percy took me through them in the course of his submissions. I may as well say at this stage, however, that none of them appeared to me to add anything of significance.

Submissions for the defenders

[9] Mr McKenzie drew my attention to the Note of Argument which had been lodged, No. 17 of process. It consisted of three parts. The first part argued that there was no fair notice of the way in which it was said that a duty of care arose. Mr McKenzie, however, indicated that he did not think it appropriate to argue that point at the Procedure Roll hearing. He conceded that if I were not with him on the other two parts of his argument, then a Proof before Answer would be appropriate.

[10] The other parts of his argument related to whether, assuming any breaches of duty had occurred, the pursuer had made sufficient averments to show that they were the dominant or effective cause of any loss which he had sustained.

[11] The third part of the argument was that the averments of loss were so lacking in specification as to be irrelevant.

[12] He dealt firstly with the averments of loss and I will follow his order.

[13] I have already set out the terms of Article V of Condescendence. Subject to what I will say about the averments at paragraph 2A on pages 14 and 15 of the Record, these were the only averments of loss. Mr McKenzie submitted that the pursuer had averred that in consequence of his failure to obtain loans he was unable to ensure his business could properly service an overdraft obtained from the Bank of Scotland, that he had granted personal guarantees in respect of the businesses' debts for which he was liable and that he had lost the opportunity to derive an income from the business. However, no fair notice was given of the persons to whom such guarantees were granted, when and on what terms. It was not said in respect of what debts they were granted. There was no specification of the circumstances in which the pursuer became liable to honour his personal guarantees or of the amount which he paid in satisfaction of them, if anything. It was not said that he was in fact called upon to pay anything. There was no averment as to the amount of the overdraft and the terms of it and why his inability to obtain a loan meant that his business could not service it. There was no averment as to the size of the loan. The averment that he lost the opportunity to derive an income from his business gave no indication of the amount of any income which he might have derived. It was said that he lost the opportunity as a result of the mishandling of the business start-up process but it was not clear what alleged mishandling was being referred to. What aspect of it caused the loss of opportunity? How was the opportunity lost? All the pursuer was left with was a bold averment that the sum sued for was reasonable and the defenders had no idea how that sum was arrived. There was no basis for preparing any meaningful tender. A figure would have to be plucked out of the air and that was unfair.

[14] In short there was no specification whatsoever of how the figure of £250,000 was arrived at and the averments were so unspecific as to be irrelevant.

[15] As far as causation was concerned, the second part of the Note of Argument, Mr McKenzie drew my attention to the terms of Article IV of Condescendence from which I have already quoted. In the first place it had to be read on the basis that Mr Massot's duty was to take reasonable care. There was no absolute duty to prevent economic loss. It appeared to be being said that Mr Massot acted when he should not have done so and failed to check whether he was entitled to act. The breach thus appeared to be that Mr Massot acted for him when he should not have been acting at all. There were no averments based on what he said and/or did or the advice which he gave. The fact that he acted was said in itself to be the breach of duty and that had important consequences. In this regard Mr McKenzie referred me to Thomson on Delictual Liability (4^th edition) paragraph 6.6 where there is a discussion of the difference between a causa sine qua non and a causa causans. He then referred to the case of Galoo Ltd & Others v Bright Grahame Murray and Another [1994] WLR 1360. In that case the third plaintiff had purchased 51% of the shares in the second plaintiff, a limited company owning all the shares in the first plaintiff. The defendants were the auditors of the first and second plaintiffs from 1981 and 1984 respectively until 1991. The agreement set out the method of calculation of the purchase consideration of the shares, namely 5.2 times the net profits of the first plaintiff in the completion accounts which were defined as including the audited accounts of the first and second plaintiffs for the year ending 31 December 1986. The third plaintiffs made loans to the first and second plaintiffs between March 1987 and January 1993 and in May 1991 purchased a further 44.3% of the shares in the second plaintiff. In October 1992 the plaintiffs brought an action complaining that the audited accounts of the first and second plaintiffs for 1985 to 1989 and the draft audited accounts for 1990 contained substantial inaccuracies and that the defendants had been negligent in failing to discover and report them. They alleged that if the defendants had performed their duties with reasonable care and skill, the insolvency of the companies would have been shown, they would have ceased to trade immediately and subsequent losses would not have occurred. The defendants applied to strike out the statement of claim on the grounds that it disposed no reasonable cause of action. At first instance the claims by the first and second plaintiffs for damages for breach of contract or in tort were struck out. The deputy judge held, however, that the third plaintiff's claim for loss arising from the original purchase of shares disclosed a reasonable cause of action. He struck out further claims for loss resulting from the loans to the second plaintiff and for amounts paid under the supplementary agreement for the purchase of the 44.3% of shares and for payments made to a director of the first and second plaintiffs for loss of office. The plaintiffs appealed and the defendants cross-appealed. All the appeals were dismissed. It was held that the mere acceptance of a loan could not amount to a loss causing damage and the acceptance by the first and second plaintiffs of loans from the third plaintiff in reliance on the defendants' statements, gave rise to no cause of action; that a breach of contract would sound in damages only if it were the dominant or effective cause of the plaintiff's loss and not if it had merely given the opportunity for the loss to be sustained and in determining whether a breach of duty was the cause of a loss or merely the occasion of it, the court would apply common sense to the facts of each case. In this case the defendants' alleged breach had provided an opportunity for the trading losses of the first and second plaintiffs to be incurred but had not caused them. The cross-appeal was dismissed on the basis that the accounts submitted to the third plaintiff were to be the completion accounts on which the calculation of the purchase price of the shares was to be based and it was common ground that the defendants knew of the terms of that agreement. In giving the leading judgment, Glidewell LJ, at page 1369 said, inter alia, the following:

"The second head of damage claimed by Galoo and Gamine is that they incurred trading losses as a result of relying on the negligent auditing by B.G.M. and thus continued to trade when they would otherwise not have done. The claim under this head is for damages for trading losses of approximately £25m incurred in and between 1986 and 1990 and for making a dividend payment of £500,000 in 1988, as set out in the particulars to which I have referred. This claim requires more detailed consideration.

It can be expressed as follows: (a) if they had not acted in breach of the duty in contract or tort, B.G.M. would have detected the fraud due in their audit of the 1985 accounts; (b) in that case, Galoo and Gamine would have been put into liquidation in mid-1986 and thus ceased to trade at that date; (c) if the companies had ceased to trade, they would neither have incurred any further training losses nor paid the dividend in 1988; (d) therefore the trading losses and the loss caused by the dividend payment were caused by the breach of duty by B.G.M.

[16] This argument depends upon the nature of the causation necessary to establish liability for breach of duty, whether in contract or in tort. There is no doubt that this is one of the most difficult areas of the law. Both counsel are agreed that, at least in the context of this case, the principles applicable to liability in either contract or tort are the same.

[17] Mr Hunter, for the defendants, submits that the plaintiff's case depends upon the adoption of the "but for" test of causation which, at least in contract, is not the proper test in English law. This is causation of the kind which has sometimes been referred to as a "causa sine qua non.""

[18] At page 1374 he went on as follows:

"The passages which I have cited from the speeches in Monarch Steamship Co Ltd v Karlshamns Oljefabriker A/B [1949] AC 196 make it clear that if a breach of contract by a defendant is to be held to entitle the plaintiff to claim damages, it must first be held to have been an 'effective' or 'dominant' cause of his loss. The test in Quinn v Burch Bros (Builders) Ltd [1966] 2 QB 370 that it is necessary to distinguish between a breach of contract which causes a loss to the plaintiff and one which merely gives the opportunity for him to sustain the loss, is helpful but still leaves the question to be answered "How does the court decide whether the breach of duty was the cause of the loss or merely the occasion for the loss?"

The answer in my judgment is supplied by the Australian decisions to which I have referred, which I hold to represent the law of England as well as of Australia, in relation to a breach of duty imposed on a defendant, whether by contract or in tort or in a situation analogous to breach of contract. The answer in the end is "By the application of the court's common sense". The other two judges in the case agreed.

[19] There was thus a distinction between an occasion for loss and the cause of it. Common sense was to be used in ascertaining whether a particular set of facts had caused loss. Mr McKenzie submitted that this case was persuasive although not binding.

[20] He then turned to the case of Scottish Widows Services Ltd v Harmon/CRM Facades Ltd (in liquidation) 2010 SLT 1102.

[21] I need not go into details of that case. Reference was made in particular to Lord Drummond Young's analysis of the law at paragraph 31 of his opinion on page 1111 of the report where he cited Galoo amongst other cases and said:

"Those cases make it clear that the 'but for' test of causation is a necessary but not sufficient condition for recovery; in addition to that test, it must be possible to say as a matter of common sense that the breach of contract or fault of the defender was the effective or dominant cause of the pursuer's loss. That is undoubtedly correct, but in my opinion it cannot be said that on the pursuers' averments there was no effective causal link between the alleged breach of contract on the part of BDP and the losses that the pursuers seek to recover."

[22] In other words, said Mr McKenzie, Lord Drummond Young was holding that the test in Galoo was correct but that on the averments in his case the pursuers' averments were sufficient to instruct a causal link.

[23] In the instant case there was simply an averment that Mr Massot acted when he ought not to have done and that was said to have caused the loss. That simply could not be right in common sense. What would the difference have been if he had not acted? If Mr Massot had said that he could not help the pursuer the latter would have been no worse off. So even if the pursuer established that Mr Massot ought not to have acted and that he had failed to check whether he could act and on the assumption that these were breaches of duty of care, the pursuer would still have to fail because there were still no averments of how these alleged breaches caused any loss. The pleadings gave no fair notice of any other way the duty of care might have been breached. It was not clear whether any loan was to be to the business or to him personally. There was no averment of inadequate advice or of any link between his inability to obtain loans and his inability to service any overdrafts. There was no link to any lack of ability to honour his guarantees or derive an income from the business. Mr McKenzie submitted that the pursuer would have to show that the only reason he or his business did not obtain the loans was because his business was in the wrong catchment area for them. He would have to show that there was no other reason why the loans might have been refused.

[24] Nothing in Article III of Condescendence said that the application for a loan failed because he was outwith the catchment area. It was a leap to say that he would have got the loan had he not been in the wrong catchment area.

[25] Mr McKenzie then went on, under reference to Hines v King Sturge LLP 2011 SLT 2, to explain why he conceded that a Proof before Answer was necessary to deal with his argument on duty of care but I need not go into the details of that.

[26] He submitted also, and in any event, that no duty of care contract had been produced or incorporated. A document which appeared to be a letter of confirmation had been produced but it was not signed and was not the version on which the pursuer apparently relied. The relevancy of his averments fell to be tested without reference to it. On page 10 of the Record reference was made to a report compiled by Mr Massot which was said to be incorporated but it had not been lodged and again could not be relied on in testing the relevancy of the pleadings. The letter dated 21 February 2005 from Jack Perry had been incorporated and although it had been lodged Mr McKenzie had not seen it. A copy was available and I decided to have regard to that.

[27] Lastly Mr McKenzie moved for expenses of process. He invited me to have regard to the interlocutor of Lord Brailsford of 17 December 2010 to which I have already referred. The pursuer's legal aid status was uncertain and a Certificate of Endorsement had not been lodged. In the circumstances I was invited to treat the pursuer not as an assisted person for the purposes of expenses. The defenders had a copy of a legal aid certificate but that was for an action against Scottish Enterprise. It was understood that it had been endorsed to cover the instant case and it was that endorsation which the pursuer had been entitled to produce. If he was unable to do so then he should not be treated as an assisted person. I was invited to put the case out By Order on the question of expenses if the defenders submissions found favour.

[28] Before I called upon Mr Percy it became evident that he had lodged a document in response to the interlocutor. This document was dated 29 September 2006 but referred to a personal injury action.

Submissions for the pursuer

[29] Mr Percy said that he had told nothing but the truth and submitted that the matter should go to proof. In response to the submission that there were no sufficient averments he said that that was the fault of his lawyers and he had made a complaint to the Law Society. He had always recognised that the averments were insufficient and the defenders should know that he had always recognised this. I was invited to fix a proof in order that certain witnesses from Scottish Enterprise could give evidence, including Charles Wood and Sir John Ward, as well as the first Minister. He had trusted that the defenders would know what they were doing. Small Business Gateway should have checked the postcodes rather than leave the matter for a month. He had gone to Lister Madusa on the basis of what Mr Massot had told him. On the smallest figures available the first year's turnover of his company would have been over a £1m. He thought everything was in place until he started receiving letters from Glasgow City Council whereupon he went to see a solicitor. The case was not about money but about justice. Mr Massot should have known from an early stage that the premises were outwith his area and should have passed him on to Renfrew. Mr Percy went on to make allegations about bribery but I stopped him from doing so since there was nothing at all in the pleadings about that. He submitted that it was time for the defenders to stop making excuses and wasting taxpayers' money. They had been pussyfooting about. He referred to Mr Perry's writing to him on 21 February 2005 acknowledging that the advice offered to him did not match the high standards which were aimed for. Mr Percy then read the averments which were annexed to the Closed Record. These were as follows:

"1A The number of contracts that were held over to A Massot was 37 in total as he asked for 20 contracts.

1B Known to be true that I had five meetings with "The Scottish Executive Board including Mr Charles Wood and Sir John Ward.

1C Also known that Mr Jack Perry called the pursuer and had a discussion on the pursuer's home telephone for 2 1/2 hours, date roughly 18th December, 2004 Mr Perry told the pursuer that he heard a completely different story than of that he heard from the defence, he set up meeting with his Board as he believed in what was said. He also sent in his investigation team Mr Hugh Murray and his colleague. 'Proof of this call can be traced to Mr Perry's call log' and 'by Mr Hugh Murray'.

2A Mr Massot should have told the 'truth' and hold his hands up if he knows what it means he brought Campbell Dallas in and both partys addressed the business plant and the projections on the 5 years of market research that was held over to him, I gave him the buying prices straight from India and he worked out that our turnover would be £103,0896 (sic) on our first year at the lowest sales possible. The pursuer had no say whatsoever as he had signed a duty of care which meant that both partys were in control with trust.

2B As to letter of 23rd October see the production and the pursuer's comments at that time and still have and still have the same today, as for letter dated 18th March, 2004 there are 'none' but a letter dated 19th March 2004 was sent to the pursuer.

2C My answer to - his failure to do so will be founded upon. Today, date 23/11/10, time 09:50 I the pursuer have had a discussion with Mr Jim O'Conner (sic) and he said that the duty of care form and the business loan forms are with Linda Gillespie as he will contact her and retrieve them and also recalls that A Massot was in the wrong post code to deal with our business and we should have been passed to Renfrewshire.

2D The pursuer is not here to commit perjury and if what Mr Jim O'Conner is saying then all paperwork will be produced 'failing that then there is something wrong with the system or who is the system protecting'.

3A Can I say to the Defence that no fax or registered Answers were received at our premises, also if I did not sign a duty of care form how would I know or understand one and that your clients lies will be founded upon and here in Scotland or in the European Courts."

[30] On reading the letter from Mr Perry dated 21 February 2005 it was plain that he had investigated matters and found that the complaints were unfounded but he went on as follows:

"However, in the course of our investigation, we found that the advice you received regarding the public bodies you should approach to obtain loan funding did not match the high standards we aim for. Both of the premises occupied by your company are located in Renfrewshire and your company was therefore not eligible for the loan funding which the original business adviser was progressing on your company's behalf, ie there was a requirement for your company to be based in Glasgow. We understand the frustration and the delay caused to your company by this and regret that it should have happened. In these circumstances we are prepared to offer your company some compensation.

We would be prepared to offer you a sum of £10,000 in full and final settlement by way of compensation for the delay and frustration incurred."

[31] Mr Percy said that this was a letter of cover-up, as he put it. Why did they offer £10,000 if nothing ever happened? The Scottish Executive should not be covering up mistakes made by Small Business Gateway. He had been taught that the Scottish judicial system was the best in the world but now doubted it. He said that he was relying on Hedley Byrne & Co Ltd v Heller & Partners Ltd [1964] AC 465 and Donoghue v Stevenson [1932] AC 562 but he did not go into any details as to how those cases helped him.

[32] He submitted that the defenders should not be awarded their expenses. A date should be set for a proof and for the court to learn the truth. He said he was in receipt of legal aid but could not get a lawyer. The Law Society put a brick wall up because he had made a complaint. He then indicated that a firm of solicitors and a particular advocate deserved to be reported.

[33] I made avizandum and shortly thereafter put the case out By Order because the pursuer had intimated that he wished me to consider further documents. The first of these was a copy of the Daily Record with a headline about gentlemen by the name of Russell and Stirton who were involved in a lengthy case in the Court of Session and which headline asked "Is this justice?". This was to do with their eligibility for legal aid. He also produced a letter criticising the conduct of the debate by the defenders' counsel. These criticisms were entirely without foundation. He conceded that apart from that letter his documents only related to the question of legal aid, which I had already said would be dealt with when I had put the case out By Order having reached a decision.

Discussion

[34] I have set out the pursuer's averments fairly fully. It is apparent to me that they are largely incoherent. Furthermore, in considering the pleadings I am precluded from reading documents which are neither produced nor properly incorporated into the pleadings.

[35] I agree with the submissions of the defenders' counsel that the averments suggest that by acting for him when he would not have done, Mr Massot somehow was in breach of a duty of care. It seems to me, however, that to some extent they go further than that. It is averred that Mr Massot undertook to provide the pursuer with assistance in incorporating a company, the preparation of a suitable business plan and applications to funding agencies. Whatever the extent of any duty of care undertaken, the pleadings can, I think, be construed as averring a duty to take care (i.e. reasonable care) in identifying funding agencies which catered for businesses situated in Renfrewshire. If the averments were as restricted as Mr McKenzie submitted then I would agree that the defenders would be well founded in arguing that at most, in acting for the pursuer when he ought not to have done, Mr Massot could only be said to have provided the opportunity for a loss to be sustained. Nonetheless, although I think the averments are not so restricted, I can detect in the pleadings no relevant link between Mr Massot's failure to identify a suitable funding agency, given the site of the pursuer's premises, his acting when he should not have done and the loss which the pursuer, or his business, is said to have sustained.

[36] Between a perusal of the pleadings such as they are and his oral argument it may be that the pursuer's real complaint is as to the delay between his first obtaining assistance from Mr Massot and Mr Massot advising him that he could not assist because he was in the wrong catchment area. However, nowhere does he say so in terms nor is it averred how that delay led him to suffer any loss. I respectfully disagree with Mr McKenzie's submission that the pursuer would have to aver that the only reason he failed to obtain finance was that his business was in the wrong catchment area. He does not have to exclude other potential problems. He does however have to aver that had a suitable financial institution been approached he would have obtained funding but nowhere does he do so. Neither is it clear, as Mr McKenzie submitted, whether the loan was to be to the pursuer personally or to the business. The letter from Mr Perry recognises that the defenders should have identified the problem with then catchment area as an earlier stage but even taking that into account it seems to me that the averments on causation are so deficient as to be irrelevant.

[37] In relation to the averments of loss, even taking account of the reference to "£103,0896", whatever that is supposed to mean, there is simply no attempt by the pursuer to quantify the loss. The figure of £250,000 appears to have been plucked out of thin air and the defenders are given no fair notice of the case they are expected to meet.

[38] I agree with Mr McKenzie's submissions about the lack of specification in relation to the overdrafts, the personal guarantees, the business debts and the loss of income. The averments are so unspecific as to be irrelevant and even if I were wrong on the question of causation, it seems to me that the court would be quite unable to find the defenders liable to make payment to the pursuer in any sum at all.

Decision

[39] I shall uphold the first and second pleas-in-law for the defenders and dismiss the action. The case will be put out By Order to consider the question of expenses.