Scottish Court of Session Decisions

OUTER HOUSE, COURT OF SESSION [2012] CSOH 178
A206/11	OPINION OF LORD BRODIE in the cause LYON & TURNBULL LIMITED Pursuer; against BARRY SABINE Defender: ________________

Pursuer: Holmes, solicitor advocate, Turcan Connell Solicitors

Defender: Wallace, Blackadders, Solicitors

23 November 2012

Introduction

[1] In this action the pursuer, which carries out business as an auction house and which, it is admitted, is one of the leading specialist valuation companies in the United Kingdom, seeks to recover the sum of £13,666.37 remitted by it to the defender, being the purchase price of a dining table sold by it on his behalf, less seller's commission and certain other charges.

[2] It is admitted on record that on 10 July 2008 the pursuer and the defender entered into a contract to provide "auction services" in respect of a particular dining table. As was confirmed during submissions, what was to be understood by that was that on 10 July 2008 there was constituted between the parties a contract of agency (with the usual incidents of such a contract) in terms of which the pursuer undertook, on behalf of the defender, to expose the table for sale by auction and in the event of a sale at or above a reserve price of £15,000 to deliver the table to the purchaser in return for the price and to remit that price, less seller's commission of 6 per cent, to the defender. It is further admitted that the pursuer duly exposed the table for sale at auction on 24 September 2008, that the table was sold to a third party purchaser (the fine and decorative art advisers, Corfield Morris) for the sum of £15,000, and that the pursuer remitted that sum to the defender, under deduction of commission, VAT and other charges totalling £1,333.63. The net proceeds remitted by the pursuer to the defender accordingly amounted to £13, 666.37.

[3] The auction sale conducted by the pursuer on 24 September 2008 at which the table was sold was described as a "Fine Antiques" sale. The pursuer prepared a catalogue listing the various lots to be sold at that sale. An extract from that catalogue is 6/3 of process. This shows a photograph of the table with an accompanying description which appeared in the catalogue as lot 355. The description is in the following terms:

"A good George IV mahogany 'scissor action' extending dining table, the well-figured rounded rectangular top with reeded edge incorporating three leaf insertions, the action stamped 'WILKINSON MOORFIELDS', on turned tapering reeded legs ending in brass socket castors, the patent action allowing the table to fold down to a side table, complete with curved brass leaf clips"

There follows a statement of the dimensions of the table and then a footnote giving information about the firm of Wilkinson & Sons which carried on business as table‑makers at Broker's Row, Moorfields between 1790 and 1808. The footnote explains that the firm was dissolved in 1808 but that Thomas Wilkinson continued in business at Moorfields until 1828. The footnote concludes: "The 'Moorfields' stamp on this table therefore reflects the firm at its peak period of production."

[4] The circumstances explaining why the purser seeks repayment of the sum of £13, 666.37 are set out in the following averments:

"Following the sale of the table, the third party purchaser, Corfield Morris, contacted the pursuer to advise that the table was not a genuine George IV scissor action table. The third party purchaser indicated that the table was not genuine and produced a report by email dated 20 May 2009 in support of that position. ...The pursuer being satisfied that the table was not genuine returned the purchase price to the third party purchaser. The third party purchaser in turn returned the table to the pursuer. The table is still currently held by the pursuer. ...The table not being a genuine George IV scissor action table is not worth £15,000. The table's true value is reasonably estimated at £1000 to £1500. The pursuer has contacted the defender to advise that the table is not genuine and has offered to return the table to the defender in return for restitution of the sum remitted to the defender. The defender has refused to return the said sum to the pursuer. "

These averments are not admitted in the pleadings but at proof before me on 2 and 3 October 2012 they were not disputed on behalf of the defender and, on the basis of the evidence that I heard and the joint minute, I hold them to have been proved.

The pursuer's case as pled

[5] The pursuer's first conclusion is in these terms:

"For reduction of the contract between the pursuer and the defender for sale of the table by the pursuer on behalf of the defender, which table was provided by the defender to the pursuer and represented by the defender to the pursuer as a George IV scissor action table. "

The pursuer's second conclusion is for payment by the defender to the pursuer of the sum of £13,666.37. A third conclusion, for payment of £187.45 was not insisted upon.

[6] The only substantive plea-in-law for the pursuer is the third plea. It reads as follows:

"The pursuer and defender having contracted in error as a result of the defender's misrepresentations, the contract between the pursuer and the defender should be reduced and the pursuer found entitled to repayment of the price paid to the defender."

[7] As Mr Holmes confirmed on behalf of the pursuer, the averments supporting that plea are the following:

"The pursuer contracted with the defender on the basis that the table was a genuine George IV scissor action table. The pursuer contracted on the basis that the defender had represented that the table was genuine. Had the pursuer known that the table was not a genuine George IV scissor action table, the pursuer would not have entered into the contract with the defender. The pursuer relied on the representations made by the defender in concluding the contract. The parties contracted in error. The pursuer, as a result of the representations made by the defender, contracted in the mistaken belief that the table was a genuine George IV scissor action table. The pursuer having contracted in error, the pursuer seeks reduction of the contract between the pursuer and the defender and repayment of the sum of £13, 666.37 paid to the defender."

The proof

[8] As Mr Wallace, who appeared for the defender, explained at the beginning of the proof, the defence to the action had originally been intended to include a challenge to the pursuer's proposition that the table was not what it had been described as being in the pursuer's catalogue, 6/3 of process. With a view to proving that it was indeed a genuine early nineteenth century table it had been hoped to lead evidence from the antique dealers who appeared on the defender's witness list (including a Mr Wilford of "Acorn Antiques") and who had provided the written testimonials referred to in the defender's pleadings and which were lodged in process but, although they had been cited, being resident in England these gentlemen had declined to attend court. The defender was therefore no longer in a position to attempt to controvert the averments I have quoted above and parties had accordingly entered into a joint minute agreeing the report by the pursuer's expert, Mr James Hardie, dated 24 August 2012, 6/8 of process, as true and accurate in its terms. Additionally Mr Wallace drew my attention to the averment on behalf of the defender: "In any event, the table having been examined to destruction, restitutio in integrum is now no longer possible." The purpose of that averment was to meet the pursuer's first conclusion which, as I will have further occasion to remark upon, is for reduction of the contract between the pursuer and the defender for the pursuer to act as the defender's agent by exposing the table for sale by auction. It was, Mr Wallace explained, now accepted that the table remained in substantially the condition it had been in when originally delivered to the pursuer and therefore Mr Wallace sought, and obtained, leave to amend the record by deleting the averment to which he had drawn my attention.

[9] This left little by way of disputed fact. What the parties did join issue over was whether, as the pursuer averred, it had been induced into agreeing to act as the agent of the defender in selling the table by relying on the defender's misrepresentation as to its qualities.

[10] Two witnesses were led for the pursuer: Mr Lee Young, fine art auctioneer and head of the pursuer's furniture department; and Mr Nick Curnow, the pursuer's managing director and head of paintings. The defender gave evidence on his own behalf.

[11] In my view each of the witnesses was to be regarded as credible. Neither Mr Holmes nor Mr Wallace suggested otherwise. Mr Wallace indeed went the distance of describing Mr Curnow as a model witness, impressive in the way that he tried to assist the court and to avoid any exaggeration. I have no reason to dispute that assessment. However, Mr Curnow and the other witnesses were labouring under disadvantages when it came to providing reliable information as to whether the defender should be taken to have made a misrepresentation to the pursuer which induced the pursuer to enter into the contract of agency. Neither Mr Young nor Mr Curnow had dealt directly with the defender prior to the sale on 24 September 2008. That had been the responsibility of Mr Young's immediate subordinate in the furniture department of the pursuer, Mr Richard Longwill. Mr Longwill did not give evidence. He was ill and I understood Mr Holmes and Mr Wallace to be agreed that it would not have been reasonable to have attempted to compel his attendance or to take his evidence on commission. For his part, as at 2008 the defender described himself as having had limited experience in dealing in antiques. He certainly did not hold himself out to be an expert. He had not previously dealt with the pursuer. Because of the passage of time he had difficulty in remembering details.

[12] I was able to accept that many of what Mr Holmes proposed as findings in fact had been established. The table had been submitted by the defender to the pursuer to be included in a sale by auction albeit I could not conclude, that it had been submitted specifically for the Fine Antiques sale of 24 September 2008. That was not explored and I would suppose, consistent with what Mr Curnow said about the table being suitable for a furniture sale (as opposed to an antiques sale) once its true qualities were known, that an auctioneer would reserve to himself the decision as to which of his sales was best suited to a particular article. However, the apparent quality of the table was such that I accept that the defender would have had an expectation, which Mr Longwill would have encouraged, that the table would be exposed at a sale of fine antiques.

[13] The defender explained that he had acquired the table by purchasing it at auction, at a price of about £3000 or a little more, from Duke's, auctioneers, of Dorchester. When he had first contacted the pursuer he had read over to Mr Longwill on the telephone the description of the relevant lot from the Duke's catalogue which was in these terms:

"595 A Regency Mahogany Extending Dining Table stamped Wilkinson, the fold over top with three additional leaves, on six turned tapering reeded legs with brass cap castors, 102" x 50""

[14] The defender's evidence was that he sent photographs of the table to Mr Longwill. Mr Longwill had said that he would like to inspect the table. The defender accordingly brought the table to Edinburgh from Devon in a van, together with other pieces, including some chairs. Mr Longwill had met him at a late hour in the evening and viewed the table. Mr Longwill had described it as "very nice" and "very good ...better in real life". He had said that he was "very happy with the table" but that he would need to show it to colleagues. As the defender understood it, the purpose of showing the table to his colleagues was for Mr Longwill to confirm his own impression of the quality of the table. In the receipt given to the defender for the table, 6/1 of process, a reserve price of £15,000 is marked against the item. In his evidence Mr Lee was sceptical about Mr Longwill requiring to consult colleagues before taking a decision about the table. Mr Lee had known Mr Longwill for two or three years and considered that he had the appropriate skill set to decide on the table and Mr Longwill had the necessary authority to procure goods for the pursuer's sales. On the other hand, Mr Lee accepted that he and Mr Longwill had discussed the chairs which the defender had brought to Edinburgh together with the table before coming to the conclusion that the reserve proposed by the defender for these chairs could not be achieved. Both Mr Lee and Mr Curnow accepted that Mr Longwill had spoken of being "excited" about the table which suggests that he had had some conversation about it with colleagues. It would be understandable if Mr Longwill did not wish finally to commit the pursuer to exposing the table in a fine antiques sale on the basis of a single late night inspection. I therefore accept the defender's account of his conversation with Mr Longwill in relation to the detail of consulting colleagues about the table. Whether he went ahead and did so, as happened with the chairs, is perhaps not so important. More to the point is that, as one would anticipate, part of the business of the pursuer is the assessment or appraisal of the quality of articles brought to it for sale. It is agreed that the pursuer is one of the leading specialist valuation companies in the United Kingdom. I would assume that its high reputation is of importance to it. Appraisal of the quality of articles submitted for its fine antiques sales would seem to be an obvious step to take in protecting that reputation and, whether such an appraisal was carried out by Mr Longwill alone or whether it was carried out by Mr Longwill in collaboration with suitably experienced colleagues, that is what I take to have happened here, as I understood Mr Lee implicitly to accept. I would see anything other than such a process of informed appraisal before exposure for sale, to be inconsistent with what appears as part of standard condition 15 in the pursuer's Conditions of Sale:

"Whilst we seek to describe lots accurately, it may be impractical to carry out exhaustive due diligence on each lot. ...Prospective buyers also bid on the understanding that, inevitably, representations or statements by us as to authorship, genuineness, origin, date, age, provenance, condition or estimated selling price, involve matters of opinion. We undertake that any such opinion shall be honestly and reasonably held and accept liability for opinions given negligently or fraudulently ..."

While this is part of what the pursuer would intend to be a contractual condition it also describes what the pursuer, through its responsible employees, does in respect of lots exposed for sale. In order to describe lots accurately and give opinions which are honestly and reasonably held, such employees must apply their knowledge and experience in assessing what is to be exposed for sale. Simply to accept a seller's description of a piece would not be consistent with that.

[15] The terms of condition 15 also helped me to accept the evidence of the defender that, while he had been provided with a copy of the pursuer's catalogue prior to the Fine Antiques sale, he had had no part in framing the description of the table which appeared in that catalogue. The defender explained that he has difficulties in reading and writing. The expression "Regency" which had appeared in the Duke's catalogue and which the defender used when giving his evidence, did not appear in the description in the pursuer's catalogue. Rather, the expression used there is "George IV". Having regard to a passage in the cross‑examination of the defender, I was left in some doubt as to whether he was aware that the son of George III who became the Prince Regent succeeded his father as George IV. The defender offered the information that the reign of William IV followed the Regency. In noting this I intend no disrespect to the defender. He was not presenting himself as a historian and from the perspective of an antique dealer assigning a date to an item of furniture, what the defender said may very well be correct. The matter is only of significance in the present context in that it points away from the pursuer adopting or otherwise relying upon the defender's description of the table when preparing its catalogue for the Fine Antiques sale. The authoritative tenor of the footnote about the firm of Wilkinson & Sons is suggestive of it coming from an expert or a work of reference. Nothing about the defender made me think that he was the author of the footnote and there was certainly no evidence to that effect. Mr Lee and Mr Curnow gave general evidence about sellers sometimes contributing material for description of a lot in a sale catalogue. I accept that evidence but it seems to me improbable that that is what happened here. Mr Holmes attached particular importance to two questions addressed to Mr Curnow. First, he was asked whether the pursuer would advertise an item for sale in the terms of lot 355 if it did not believe it to be as it was advertised. Mr Curnow replied "Absolutely not". The second question, which came immediately after the first, was whether if a would-be seller approached the pursuer with an item for sale described in a particular way but the pursuer was of the view that the item was not as it was described by the seller, would the pursuer agree to expose that item for sale. To that question Mr Curnow replied "No". Again, I accept these answers as accurate but they do not, in my opinion, undermine my conclusions that, as a matter of probability, in this particular case, Mr Longwill's interest having been aroused by the defender's reading to him the description given in the Duke's catalogue, Mr Longwill came to his own assessment of the qualities and provenance of the table on the basis of his inspection of the table and an application of his expertise or that of fellow employees of the pursuer, and that that assessment informed the terms in which the table was described in the pursuer's catalogue.

[16] As matters transpired, the pursuer was in error about the table brought to Edinburgh by the defender. That the error was an honest error on the part of the pursuer, I have no doubt. However, despite an appearance which could easily pass expert examination as a Wilkinson table manufactured in the period 1810 to 1830, the table proved to be no such thing but, rather, as stated by Mr Hardie in his report, it was "a piece made to deceive". Nevertheless, as I have already indicated, the table was exposed for sale as described in the pursuer's catalogue and purchased by Corfield Morris. Thereafter Corfield Morris rejected the table complaining that it was not what it purported to be and therefore the pursuer felt bound to repay the price which it did.

Discussion
Proof of the pursuer's averments

[17] As I have indicated, I have found a great deal of what the pursuer avers to have been proved. Much was essentially uncontroversial. More difficult was what Mr Holmes, on his approach to the case, clearly saw as a critical averment:

"the pursuer, as a result of the representations made by the defender, contracted in the mistaken belief that the table was a genuine George IV scissor action table".

There are a number of elements in that averment, as Mr Holmes recognised when he came to address me. Mr Holmes adopted the terminology for these elements which is found in McBryde, The Law of Contract in Scotland, 3^rd edit, at paras 15-66 et seq: (1) there was a misrepresentation; (2) the misrepresentation induced the contract; and (3) the misrepresentation must have been by the defender. Mr Holmes also accepted that for reduction restituto in integrum must be possible. I shall leave the matter of restituto in integrum aside as it is now accepted that the table remains in substantially the same condition as it was when the defender delivered it to the pursuer, and confine myself to the three elements mentioned by Mr Holmes, albeit I shall take them in a slightly different order.

[18] The defender undoubtedly made a representation to the pursuer in that, by way of description of the table, he read out to Mr Longwill what appeared in the Duke's catalogue. Insofar as the catalogue described the lot as a Regency table (that is a table manufactured in the early part of the nineteenth century) that was an inaccurate description and, accordingly, it can be said that the defender misrepresented the nature and quality of the table to the pursuer. That, however, is all that it has been proved that was said about the table by the defender which was inaccurate. No doubt the expression "Regency" gives a context to what follows in the Duke's description but what follows is, as I understood it, literally correct. There was no evidence of any other verbal misrepresentation by the defender. Mr Holmes accepted that but, under reference to Patterson v Landsberg& Son (1905) 7 F 675, submitted that simply by presenting the table for inspection the defender was making a misrepresentation (albeit an innocent misrepresentation) to the pursuer. I shall return to that submission but would first wish to consider what can be taken as having been proved about the effect of the defender innocently misrepresenting to Mr Longwill that he had a Regency table for sale by auction by reading over the Duke's description. On my assessment of such evidence as is available it can be assumed that on hearing the whole of the description from the Duke's catalogue, that is the inaccurate attribution "Regency" and the literally accurate but misleading other details, Mr Longwill's interest will have been aroused sufficiently to encourage the defender to make the long trip from Devon, but once Mr Longwill had the table available for inspection, the description from the Duke's catalogue will have played no material part in his assessment of the table and the pursuer's subsequent decision- making. This, in substance, was Mr Wallace's submission and I accept it. It would seem to me to be simply untenable to suggest otherwise. The defender was previously unknown to Mr Longwill. According to the defender (and there is no evidence to the contrary) he was not an expert and did not hold himself out as an expert. As I understood the defender's evidence, he would have been careful to avoid disclosing where he had acquired the table and therefore he would not have shown the Duke's catalogue to Mr Longwill. I simply cannot see Mr Longwill relying on what was said by a dealer such as the defender of whom Mr Longwill knew nothing. Even had the defender given Mr Longwill a sight of the Duke's catalogue I would expect Mr Longwill to have come to an independent assessment of the qualities of the table. Mr Longwill had an expertise in antique furniture, as Mr Lee confirmed. He was employed by one of the leading specialist valuation companies in the United Kingdom. He had colleagues to call on for advice. Condition 15 of the pursuer's Conditions of Sale gives an indication of what the pursuer does before giving an attribution to an article to be sold. The pursuer has a reputation to protect. While disclaiming what it describes as "exhaustive due diligence on each lot ", it seeks to describe articles accurately. That must involve the pursuer, through its employees, coming to its own view on what it proposes to sell. Here Mr Longwill and perhaps his colleagues, were deceived and thereby led into error as to qualities of the table, as it may be assumed Corfield Morris were also initially deceived, but I cannot accept that this error was materially induced by anything which has been proved to have been said by the defender. What may be taken to have deceived Mr Longwill, and such other experts who were involved, was the appearance of the table; it was, after all, as parties are now agreed, "a piece made to deceive".

[19] At this point I must return to Mr Holmes submission under reference to Patterson v Landsberg& Son. In addition to what the defender read over to Mr Longwill on the telephone, Mr Holmes also relied in the appearance of the table, it being, in the assessment of Mr Hardie, a piece made to deceive. Simply by presenting such a piece to Mr Longwill, albeit in all innocence, the defender, on Mr Holmes's approach, was to be taken to have made a misrepresentation, an innocent misrepresentation but a misrepresentation nevertheless. I do not agree. A misrepresentation is of the nature of a statement about something. I accept that there are circumstances in which silence can amount to a statement and information can be communicated other than by words but essentially a representation, and therefore a misrepresentation, is the communication of information concerning a thing or a state of affairs.

[20] As I have already indicated, in support of his approach to the matter Mr Holmes referred to Patterson v Landsberg & Son. Patterson is a case about modern fabrications sold as antiques or objects of vertu by an English dealer to a Scottish dealer and to that extent may be thought to be in point. There is however an important difference between Patterson and the present case. The defenders in Patterson had had the fabrications made to their order. They intended to mislead and did mislead the pursuer. Although not pled explicitly in these terms, it was a case of fraud, as was recognised by the court. There were three items in issue: a necklace with a miniature of Flora Macdonald, a medallion of Queen Victoria in coronation robes, and a brooch with a miniature of the Duke of Albemarle (the former General Monk). In relation to two items the defenders made statements as to their provenance which they knew to be false. Lord Kincairney summarised the position thus, at 680:

"I think it proved that in these three transactions the defenders practised a system of deception against which possibly the pursuer might have been unable to find a remedy, had not the defenders gone the length of positive misrepresentation."

Mr Holmes relied on the way the evidence had been approached by Lord Kyllachy in a passage of his opinion at 681:

"I must say I incline to hold upon the proof, and indeed upon the defender's own evidence, (1) that the appearance of age and other appearances presented by these articles constituted by themselves misrepresentations; in short, that the case is really one of res ipsa loquitur ; (2) that this being so, the defender was not entitled to leave, as he says he did, the articles to speak for themselves, but was bound to displace the inferences which the appearance of the articles was to his knowledge bound to suggest; and (3) that the defender not only failed to do this, but by the use of equivocal language and assumption of airs of mystery and otherwise, indorsed and helped to encourage the inferences which the appearance of the articles suggested. I refer in particular to such things as (1) the attachment of the £350 ticket to the Victoria miniature, as to which the defender can give no explanation; (2) the statement as to the same miniature that he knew nothing about it, and could give no history; (3) the similar statement as to the Albemarle jewel; and (4) the conversation of a similar import as to the ribbon required (as shewn in old pictures) to be used in wearing the Flora Macdonald necklace.

It appears to me that it is difficult to say that the defender has discharged the onus which in these circumstances rests upon him, and I am disposed to think that in this view alone the pursuer is entitled to judgment."

In that passage I would draw attention to the words: "the defender ... was bound to displace the inferences which the appearance of the articles was to his knowledge bound to suggest". In other words, given that the articles appeared to be antiques whereas the defender was well aware that they were recently manufactured, he had to explain what he knew. Otherwise he was to be taken to have deliberately and therefore fraudulently misled the pursuer by his silence. In an earlier passage in his opinion to that referred to by Mr Holmes, at 680, Lord Kyllachy said this:

"I think it quite possible that the defender at all events believed that he had sufficiently guarded himself against what he calls guarantees (or as he probably means representations) as to the character and history of these articles. But on full consideration I have been unable to conclude otherwise than that, in one way or another, he (the defender), knowing the contrary, conveyed to the pursuer that the Flora Macdonald and the General Monk jewels were what are commonly called "antiques," and that if the Queen Victoria miniature was not an antique, it was at least a contemporary portrait having a history. That is the Lord Ordinary's view who saw the witnesses and took the proof, and I am unable to say that he had not sufficient grounds for that conclusion."

Thus both for Lord Kincairney and Lord Kyllachy (the Lord Justice‑Clerk simply concurred), while the appearance of the articles may have falsely suggested age or a particular provenance, what amounted to the fraudulent misrepresentation was the deliberate conveying of the ideas that the articles were of a particular age or had particular associations by the totality of the circumstances in which the defenders' representative (referred to in the opinions as "the defender") showed them to the pursuer, including the making of statements that he knew to be false. As Mr Wallace put in submission, in Patterson the defenders had set about misleading the pursuer. That is very different from the situation in the present case where it is not disputed that the defender had no reason to believe that the table was other than what had been described in the Duke's catalogue. Thus while I accept that the pursuer has established that the defender made a misrepresentation about the quality of the table, on the evidence led that was limited to what the defender admitted to having said to Mr Longwill during their telephone conversation before the table was brought to Edinburgh. Bringing the table to Edinburgh and showing it to Mr Longwill there did not amount to a further misrepresentation.

[21] It is accordingly my opinion that the undoubted error of the pursuer as to the table being a genuine George IV scissor action table cannot be regarded as having been induced by anything which properly could be described as a misrepresentation by the defender. There is no basis in the evidence to permit the inference that the pursuer's error arose from its reliance on what the defender said. The case that the pursuer has chosen to plead therefore fails at this point on the facts. There is however an additional factual difficulty on the approach adopted by the pursuer. The contract which the pursuer seeks to reduce, it will be remembered, is the contract to act as auctioneer, in other words the contract of agency between the pursuer and the defender, not, for example, the contract of sale between the pursuer and Corfield Morris. It is by no means clear on the evidence as to why the table being a genuine George IV scissor action table was material to the pursuer's decision to agree to act as the defender's agent. Admittedly, had the pursuer known that the table was a fake, a good fake, but a fake, it would have not exposed it in the Fine Antiques sale, but the pursuer's business as auctioneers is not confined to fine antiques. On the evidence, the contract between the parties did not require the pursuer to expose the table at any particular sale. The table is attractive. It has a value. As Mr Curnow confirmed, knowing the table to be what it is, the pursuer might expose it, suitably described, at one of its furniture sales. Thus, even had the pursuer proved that its undoubted error as to the true qualities of the table was induced by a misrepresentation, it is by no means clear from the evidence why, on the basis of that error, the contract of agency should be reduced.

The relevancy of the pursuer's case as pled

[22] Having stated my conclusions on proof of the facts which the pursuer has chosen to aver I turn to a matter that I would confess has exercised me since I first read the record. While I must recognise that I have not heard anything approaching full argument on the matter, it appears to me that the analysis of the pursuer's rights and remedies which is reflected in the pleadings on its behalf is seriously flawed. I shall endeavour to explain why this is my view, uninstructed as it is by sufficient submissions by counsel.

[23] Primarily, the relationship between the pursuer and the defender is that which was constituted by the contract in terms of which the pursuer agreed to act as the defender's agent in the sale of the table by auction. Insofar as that contract imposed obligations upon the pursuer the pursuer has duly discharged these obligations (except perhaps the obligation to return the table to the defender, but the pursuer has a lien over the table in respect of such claims as it has against the defender); it exposed the table for sale in an auction of fine antiques, it concluded a sale, it collected the price, it delivered the table to the third party purchaser and it remitted the price less deductions that it was entitled to make to the defender. For that reason alone it is surprising to find a claim being made at the instance of the pursuer for reduction of a contract by virtue of which nothing further can be required of the pursuer. But it goes further than that. By succeeding in reducing the contract of agency the pursuer would be throwing away rights it has against the defender. It may be that nothing further can be required of the pursuer under the contract. It does not follow that nothing further can be required of the defender.

[24] As I indicated to Mr Holmes in course of his submissions, I was puzzled as to why the pursuer had not presented a claim under the contract by which parties had chosen to regulate their relationship. Pursuing such contractual claim as is available would not require recourse to the equitable and therefore discretionary remedies of reduction or reversal of unjustified enrichment. Now it may be that the pursuer does not have a good contractual claim but, if that be so, that raises a question over the availability of reduction as remedy. As I have said, reduction is an equitable remedy. If parties have so contracted or so conducted themselves that in the circumstances a particular claim which a contract of that sort would usually provide is not available, that of itself might be reason for the court to refuse reduction. There is an additional problem with the way in which the pursuer's case is presently pled. The underlying assumption appears to be that once a contract is reduced on the basis of material error induced by misrepresentation then the automatic result is that all payments under the contract must be ordered to be reversed. That is not exactly my understanding of the law and on inquiry of Mr Holmes he was unable to point to any authority supporting the position taken in the pursuer's pleadings. I do not say that on reduction of a contract there may not be scope for reversal of payments made in implement of it, but once the contract is gone, a claim for repetition of money paid over must be on some other basis; reduction is a remedy but it may not be a complete remedy. What the pursuer is looking for is repayment of the money it remitted to the defender. A non‑contractual claim for repetition is suggestive of some aspect of unjustified enrichment. While it may not be necessary to ascribe the claim to one of the traditional categories (cf Shilliday v Smith 1998 SC 725), one would expect some identifiable basis set out in the pleadings and preferably a specific plea‑in‑law. I do not find that in the present case and indeed Mr Holmes seemed to be uncertain as to committing himself to reliance upon some aspect of unjustified enrichment. He certainly did not develop any argument in that direction. Thus, on the way the pursuer's case is pled, not only is there no factual basis for recovery, there is no comprehensible legal basis for recovery.

Outcome

[25] That the pursuer has failed to prove what it set out to and that even had it done so it is doubtful that this would justify granting the remedy it seeks may be thought to be the end of the matter. In the particular circumstances of this case I am not satisfied that this is necessarily so. At least I am not prepared immediately to proceed upon the basis that it is an end to the matter. The parties are essentially at one on the material facts and these facts might arguably call for a remedy. I understood Mr Wallace to acknowledge the nature of the situation which had been arrived at but he discouraged me for indulging in what he referred to as "juristic gymnastics" in order to grant an appropriate remedy where the pursuer had, as it would appear deliberately, chosen what, on analysis, was the wrong remedy. I recognise the force of what Mr Wallace had to say but I am reluctant to part with a case in such a state. The case will be brought out by order with a view to determining what, if any, further procedure parties might propose as being appropriate. I should make it clear that I remain willing to hear any submission including a renewal of Mr Wallace's submission that the appropriate decree in the circumstances is absolvitor with an award of expenses in favour of the defender. Meantime I shall make no order.