Scottish Court of Session Decisions

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URL: http://www.bailii.org/scot/cases/ScotCS/2020/2020_CSOH_79.html
Cite as: 2020 GWD 29-378, [2020] ScotCS CSOH_79, [2020] CSOH 79

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OUTER HOUSE, COURT OF SESSION

[2020] CSOH 79

CA167/19

OPINION OF LORD CLARK

In the cause

PETER J STIRLING LIMITED

against

BRINKMAN (HORTICULTURAL SERVICE) UK LIMITED

Pursuer

Defender

Pursuer: Massaro; Allan McDougall

Defender: Smith QC, Murray; DAC Beachcroft Scotland LLP

13 August 2020

Introduction

[1] The pursuer operates a farming business, which includes growing a large amount of

strawberries on several farms. The strawberries are planted through holes in polythene

sheeting that is used as ground cover. For many years, the defender supplied the polythene

sheeting. The pursuer claims that the sheeting supplied in August 2016 was not fit for

purpose and as a result the strawberry crops were affected and losses incurred. The pursuer

seeks an award of substantial damages for this alleged breach of contract. The defender

claims that its terms and conditions were sent to the pursuer and incorporated into the

contract and that these give exclusive jurisdiction to the courts in England and Wales. The

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pursuer denies receipt of the terms and conditions. The case called before me for a proof

before answer, restricted to the question of whether the defender’s terms and conditions

were incorporated into the contract and as a consequence whether this court has jurisdiction.

This was the first Court of Session proof to be dealt with by way of video-conference, as a

result of the Covid-19 pandemic. As a result, parties required to provide information to the

court in advance of the proof about a number of technical and witness-management issues.

At the commencement of their testimony, witnesses were required to confirm compliance

with the directions they had been given by the court, including being alone in the room,

having no access to means of communication with others and not having perused the

productions sent to them.

Background

[2] For a number of years, the pursuer and its predecessor businesses have purchased

polythene sheeting from the defender for use at the farms. The pursuer’s business was

formerly run by Peter Stirling as a sole trader. In December 2011, the business entity

changed to a limited liability partnership named P J Stirling LLP. The present pursuer is a

private limited company, incorporated on 18 June 2014. Mr Peter Stirling is the sole director

and the majority shareholder. The business was transferred from the LLP to the pursuer in

January 2016. Letters dated 12 January 2016, addressed to “Brinkman Agricultural Services”

were sent by both the LLP and the pursuer to advise the defender of the change in the

business entity. In around June or July 2016, the pursuer’s soft fruit manager

Mr Kenneth Shellard placed an order, in a telephone call with the defender’s Chief Executive

Officer Mr Glenn Notley, for blue polythene covers. Exchanges by email about the order

then followed. Typically, orders were made and sales agreed informally in communications

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between Glenn Notley and Kenneth Shellard, who were the respective principal points of

contact for any sales by the defender to the pursuer. The pursuer purchased a quantity of

blue polythene, which was delivered to the pursuer in August 2016. The defender

subsequently sent an invoice dated 19 September 2016 to the pursuer, for payment

of £21,488 plus VAT. The pursuer received the invoice on 26 September 2016 and on

14 November 2016 paid this sum to the defender. Thereafter, the dispute as to the alleged

deficiencies in the polythene arose. The pursuer’s farm office is at Seahills Farm. It also has

an administration office at an industrial estate in Arbroath. The administration of the

pursuer’s business is shared between these two offices. Until mid-2019, Seahills Farm was

known as Windyhills Farm. The farm is located near to Auchmithie, in Arbroath.

[3] In the course of discussions between them about the points in dispute, on behalf of

the defender it was stated to the pursuer that the defender had sent a letter dated 30 July

2012 to P J Stirling LLP which was said to be in the following terms:

“Windy Hill Farm,

Authmithie,

Arbroath,

Angus,

Scotland,

[postcode]

NEW TERMS AND CONDITIONS OF SALE

As from 6th August 2012, Brinkman (Horticultural Service) UK Limited is introducing

new terms and conditions of sale that will cover the transactions between our two

organisations. A copy of these terms and conditions is enclosed.

Any deviation to our standard terms and conditions, including customers referring

to their own terms and conditions, must be agreed in writing between the parties.

Should you have any questions about this please contact the undersigned in writing.

We are also currently updating our customer account records. As such, please can

you confirm an email address for the accounts department which we can use for

future accounts correspondence if you could send a confirmation from that email

address to [Elaine’s email address] we will update our records accordingly.

Yours faithfully

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[signed]

Mr Stephen Mortimer

Managing Director

(On behalf of Brinkman (Horticultural Service) UK Limited)“

The defender’s position was that the terms and conditions were enclosed with that letter.

The pursuer stated that the LLP did not receive the letter or its alleged enclosure.

[4] The defender’s terms and conditions were drafted by a firm of solicitors and sent by

that firm to the defender in July 2012. A template letter dated 26 July 2012 was prepared by

the defender to be sent to its customers, enclosing a copy of its terms and conditions.

Clause 11.2 of the terms and conditions prorogates exclusive jurisdiction to the courts of

England and Wales in respect of all disputes arising out of a contract governed by those

conditions. Clause 7.4 of the terms and conditions seeks to limit the defender’s liability for

loss arising under or in connection with a contract governed by the terms and conditions.

The defender did not receive an email from the pursuer in the terms requested in the letter.

The parties are in dispute over whether the letter dated 30 July 2012 was sent by the

defender or received by the pursuer.

The parties’ averments

[5] The averments for the pursuer include the following:

“The letter is not addressed to P J Stirling LLP nor to any equivalent or similar

trading name or description. The postal address on the letter is incorrect if intended

as the LLP’s trading address. The office for the Pursuer’s (and formerly the LLP’s)

business is only one of eight occupied properties at Windyhills Farm. The other

seven are residential properties. On its business correspondence the Pursuer (and

formerly the LLP) always used its name and never referred to itself as ‘Windyhills

Farm’. Three of those properties at the Farm are owned, and were then owned, by

people unconnected with the business. Three are let out, and were let out at the

time. The letter was not seen by Mr Peter Stirling. It would not have been seen by

either of the other members for the reasons hereinbefore condescended upon. No

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other employee had authority to accept any contractual terms on behalf of the LLP.

Had such a letter been received by an employee of the LLP , it would have been

passed to Mr Peter Stirling or the then office manager, Mr Tom Mann, for his

consideration. The Pursuer has as a matter of course always retained important

business correspondence received by it and the LLP. It does not have a copy of the

letter, nor of the Defender’s terms and conditions. The Pursuer has no record of it or

the LLP ever having received the terms and conditions. Neither the Pursuer’s

director, nor the former LLP’s members, had seen the terms and conditions now

produced by the Defender and had no knowledge of their existence prior to the pre-

action correspondence for this action. The previous course of dealing condescended

upon by the Defender was not therefore conducted on the basis of the Defender’s

terms and conditions. The ‘communications system’ between the parties, and

between the LLP and the Defender, was typically by email. When deliveries were

made by third party couriers they only occasionally came with a delivery slip.

Otherwise, invoices and monthly statements were usually emailed. The Pursuer’s

Susan Spink did contact the Defender’s Elaine Thorely and others on various

occasions to explain that invoices did not appear to have been received and asked for

them to be emailed or posted. There does therefore appear to have been historic

issues with the ‘communications system’ which were identified by the Pursuer and

before it by the LLP to the Defender. Esto the terms and conditions document was

incorporated into the parties’ contract (which is denied), there was no specific

consent on the part of the Pursuer (or the LLP) to the exclusive jurisdiction clause

and thus it was not incorporated …”

[6] The averments for the defender include the following:

“In July 2016, the pursuer contacted the defender by telephone to ask for delivery of

136 rolls of polythene. An invoice was then issued by the defender to the pursuer, a

copy of which is produced. The invoice stated on the front that “All business subject

to our standard conditions of sale which include retention of title clause.”

Predecessor corporate entities of the pursuers commenced trading with the

defenders in about the year 2000. All such entities traded from Windyhills Farm.

The defenders’ notepaper states the business address to be ‘Windyhills Farm’. A

lengthy and consistent course of dealing was established between those entities and

the defenders. Correspondence was taken from details provided by the Pursuers in

their prior iteration as the LLP, from a ‘merge’ database which was used for all

correspondence including invoicing and receipts, and advice on credit facilities. The

pursuers have never suggested prior to the averments in this action that the

communication system to Windyhills Farm was in some way defective. Until

January 2016, that business was carried on by Peter J Stirling LLP (‘the LLP’) from

the said address. On 30th July 2012, the LLP was notified by letter that ‘as from

6th August 2012 ... new terms and conditions of sale … will cover the transactions

between our two organisations.’ A copy of the terms and conditions was enclosed.

Although the letter was addressed to ‘Windy Hill Farm’, no organisation other than

the LLP traded with the defenders from those premises at that time. The address on

the pursuers’ headed notepaper is ‘Windyhills Farm’. Trade continued between the

LLP and the defenders as from that date and was thus under the terms and

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conditions enclosed. By letter dated 12th January 2016, the LLP wrote to the

defenders advising that ‘the business of PJ Stirling LLP is to be transferred to

Peter J Stirling Ltd’. The letter was addressed to “Brinkman Agricultural Services”.

However, the LLP, and the pursuers, clearly intended that to be a reference to the

defenders and continued to trade with the defenders. That letter stated that the

‘existing contract or arrangements with the LLP (the ‘contract’) will be transferred to

the Ltd Co.’. The terms and conditions referred to in the letter of 12th January 2016

[sic] were thus incorporated into any further trading as between the pursuers and

defenders. Trade did, thereafter, continue between the parties as it had between the

LLP and the defenders and did so under the terms and conditions referred to in the

correspondence in 2012.”

Evidence

Witnesses for the pursuer

[7] Peter Stirling explained how the farm business operated, including in relation to

issuing orders for products, receiving invoices and making payments. He described the role

of the various employees. He is involved in all strategic decision-making and was solely in

charge of running the farming business during the lifetime of the LLP but left most of the

day-to-day running of the business to the key staff. He was not aware that the business had

entered into any general contractual arrangements with any of its suppliers and had no

recollection of ever seeing any “standalone set of terms and conditions” sent from any

supplier. He spoke to the letters sent out in January 2016 about the business changing hands

from the LLP to the pursuer. At that time, the LLP did not, as far as he was aware, have any

contracts with any suppliers, other than payment terms. The letter allegedly sent by the

defender on 30 July 2012 was not addressed to the LLP and was addressed to “Windy Hill

Farm”, as opposed to Windyhills Farm. It also used the name “Authmithie” rather that

Auchmithie, which is the village local to the farm. In its correspondence, the LLP had

always identified itself by its name and given the address as “Windyhills Farm, Arbroath,

Angus” with the postcode. There are (and were in 2012) seven residential buildings on the

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farm and one farm office, which is a separate building from the farmhouse. There are three

cottages that are owned by third parties, unconnected with the farm and three cottages

owned by him but tenanted by other people involved in the farm business. The seventh

residential building is the farmhouse in which he resides. The farm office is situated next to

the farmhouse and the farm steading. Because of the number of properties on the farm,

there had been a long history of postal mix-ups, with letters and parcels being delivered to

the wrong addresses on the farm, even when the correct address has been on the envelopes.

The farm office had received mail which should have been delivered to the three

independent cottages, as had his farmhouse and the other three staff members’ cottages.

There had also been times when wrongly delivered mail had been handed into the office by

farm residents, including farm manager Gary Bruce while he resided in his cottage known

as “The Bothy”. Even in the last month there had been problems with mail going astray.

There had never been any indication made to him that the defender wished to formalise the

relationship by the parties agreeing contractual terms. None of the staff, who were

experienced, had any recollection of receiving the letter dated 30 July 2012. Searches had not

revealed any copy of it. There was no trace of an email having been sent to the email

address in the letter. The defender did not follow this up by either calling the pursuer or

sending a copy of this letter by email to ensure the pursuer received it. He understood that

there had been established e-mail communication between Susan Spink from the farm and

Elaine Thorely of the defender prior to the date of this letter. While some invoices from the

defender addressed to “Windy Hill Farm” had been received, the email correspondence

showed, around 2012, invoices being re-sent by the defender due to the originals not having

been received by the LLP. The invoices attached to these e-mails were addressed to “Windy

Hill Farm” at the same address given in the letter dated 30 July 2012. The invoice for the

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polythene ordered in mid-2016 stated “All business subject to our terms and conditions of

sale which include retention of title clause”. Mr Stirling had learned, during the course of

this court action, that this was present at the bottom of all of the defender’s invoices

produced in the action. He did not generally have sight of invoices as these were simply

received and processed by the administrative staff in the office.

[8] In cross-examination, Mr Stirling accepted that there was no other place called

“Authmithie”, nor was there any other farm with the name stated in the letter. The postcode

in the letter was the postcode of the farm office and a few other premises. If the letter had

been delivered to, for example, a cottage on the farm it would have been fairly easy to work

out where it should go. But there had been another mistake just a few weeks ago. No issues

had been raised by the pursuer about use of the wrong address. The preferred method for

the pursuer to receive correspondence from the defender had moved from post to email and

then Ms Spink had asked the defender to go back to post again. It was not impossible that

the letter had been sent, but the staff were very methodical. The business had never been

called Windy Hill Farm.

[9] Susan Spink is the office manager for the pursuer (as she was for the LLP) and she

works from the farm office. Her role includes processing staff wages, organising and

processing the paperwork for seasonal staff, matching invoices with purchase orders and

delivery (or goods received) notes, and carrying out other administrative tasks such as

opening up and passing round any mail that comes into the farm office. She opens the mail

each morning and directs it to the most appropriate person. If she was on holiday, the mail

would have been opened by a colleague. The person at the defender with whom she had

most direct contact was Elaine Thorely. In 2012, the witness had requested that invoices be

sent over as they were missing on the pursuer’s system and the pursuer could not trace

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having received the originals. She later asked if all invoices could be sent by post due to the

volume of e-mail traffic she was receiving. She did not recall receiving a copy or having

sight of a set of any of the defender’s terms and conditions or any contract between the LLP

or the pursuer and the defender. A thorough search had been carried out of the pursuer’s

cupboards, files and e-mails and a search of staff e-mails had also been done by the

pursuer’s IT company. No trace of any terms and conditions or a copy of the letter dated

30 July 2012 were found. To her recollection, she had not seen the letter before being shown

it as a production in the case. If it had been delivered, then she expected that she would

have opened it. Having checked her personal diary, on Thursday 2 August 2012 she left

work an hour early to go away for the weekend. On Wednesday 8 August and Thursday

9 August she was on holiday. Even if she had not been at work on the morning the letter

arrived, it was the sort of thing that would have been left for her to distribute following her

return to work. Had she opened this letter up, she would have put it on Tom Mann’s desk

or may possibly have passed it to Peter Stirling. This would have been done because it was

important to the company. Tom Mann’s desk was just across from her desk. Sometimes

there had been issues with external mail reaching the farm office. For example, the office

would sometimes get mail in for other cottages on the farm. This had gone on since

before 2012. There was no trace of any e-mail having been sent to the defender confirming

an e-mail address for the pursuer’s accounts department, in response to the request in the

letter for that to be done. She was not aware of any follow-up e-mail or other

correspondence chasing up a response to their letter. The defender would have been sent

correspondence with the correct name and address of the LLP in early 2012. It was

surprising that the defender’s staff still addressed the letter dated 30 July 2012 as they did.

The LLP would never identify itself as “Windy Hill Farm” or “Windyhills Farm”. However,

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she was aware that invoices were being sent by post and addressed in the same manner as

the letter and that a number of these were received and paid by the pursuer. But some

invoices addressed in this manner were never received and had to be requested by email as

noted earlier. It was not part of her role to read the small print on invoices.

[10] She did not work on Fridays, including in 2012. 30 July 2012 was a Monday. She

had no basis to think that the letter might have been received and then lost. Her primary

responsibility was invoicing. It was correct that she had suggested that the defender should

use the postal service. She “100%” trusted her colleague who, when she was on holiday,

would open the mail and put it into two folders (invoices and then other items) and leave

them for her to distribute. The postcode on the letter was correct. Even in the past week

mail addressed to people in the farm cottages had arrived at the office. In carrying out her

search, she hadn’t searched boxes which were to deal with things other than items like the

letter. Terms and conditions would not be put in these other boxes. She could not say that

the letter had definitely not been received, but if it had been she would have been asked to

reply to it and there was nothing to show that had occurred. It would be very hard for a

document to be mislaid in such a small office. Only about ten items of mail would have

come in each day during mid-2012.

[11] Kenneth Shellard is the pursuer’s soft fruit manager. He lives in a cottage located on

the farm formerly known as Windyhills Farm. He has his own desk and computer in the

farm office, which he uses as a base, although he is out on the fields for most of the working

day. The office manager, Ms Spink, worked in an adjoining room in the office. She was

responsible for the clerical work and opens all mail that comes into the farm office and

directs it to the relevant people. There are two postmen, one of whom is diligent and the

other less so. When the latter is working, some of the neighbours’ post will be delivered to

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the farm office and items in the pursuer’s post will go to the neighbours. There had been

issues with his personal post being delivered to neighbours and to the office in the past. He

kept files of the paperwork for each growing year and at the year-end these were placed into

cardboard boxes for storage. Electronic files are stored on his computer. His principal

involvement was in the practical aspects of the business. He would regularly speak on the

phone with Glenn Notley about the pursuer’s requirements, or communicate with him by

email, but there was never any discussion about formalising the arrangements or agreeing a

contract. Terms and conditions were never mentioned in any of the discussions and were

never sent with any correspondence. He could not recall ever seeing the letter dated 30 July

2012 with the terms and conditions. If he had received it then he would have kept it; he

would have remembered it as being quite unusual. He would have drawn it to the attention

of someone more senior and he would then have put it in his general miscellaneous

paperwork folder. He had searched his emails and had found no email sent to Elaine at the

defender as requested in the letter. Even in the last two to three weeks there had been

incidents of mail to other farm houses being passed into the office. If a document was

“100% relevant” to him he would action it and return it to the administrative part of the

office. Had he seen the letter, he would have had a verbal discussion with his senior

colleagues about it. It would not have been his responsibility to respond to the letter. It was

surprising that the letter said to have been sent had not been sent by recorded delivery.

While previous invoices had been sent to “Windy Hill Farm”, his focus would have been on

the cost of supply. Issues about an incorrect name and terms and conditions were more of

an “an office based/admin clerical thing”. If Ms Spink had opened the letter and seen the

terms and conditions, his view was that the document should have stayed within the

administrative part of the office.

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[12] Tom Mann is the pursuer’s financial officer, as he was for the predecessor businesses,

and has been in that position since 2000. Prior to 2016, he used to split his time between the

pursuer’s office in the industrial estate in Arbroath and the farm office. His role mainly

involves the preparation and management of accounts. He is not involved with processing

orders or payments and has very little, if any, contact with suppliers. The office managers

would generally be the ones who had direct contact with suppliers about such things as

invoices. The procedures for receiving and processing incoming documents, such as

invoices, at the farm office were relatively straightforward and had been in place since he

started work with the business. When mail arrived the same system was, and is, in place.

Opening of any mail would be dealt with by the office manager. All mail would be opened

by that person. Only items marked “private and confidential” or correspondence with

Peter Stirling’s name on it would not be opened. Paper records at the offices were kept in

files. Purchase invoices, with purchase orders and delivery notes attached were filed in

lever-arch folders and held in the administrative office until the relevant year-end audit had

been completed, before being archived in a separate archive room. Files were retained in the

archive room for the required statutory period set by HMRC and audit bodies, which is six

years. The vast majority (99%) of incoming mail would be passed to the manager

responsible. If the business had received any terms and conditions at the farm office, the

standard systems would ensure that they would be directed to the manager who dealt with

the supplier as it would only be that person who could determine that the terms were valid

and met with their requirements. If the office managers were unsure of the correct

distribution of a document then they would pass it to him for consideration. He would then

redirect it to the person who could deal with it best. If it had come from a supplier of

equipment relating to strawberry production then he would have passed it on to

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Kenny Shellard. If a separate letter outlining terms and conditions had been received then

because the purchase invoices in 2012 were filed alphabetically, by supplier, it would have

been filed with the invoices, or retained for reference by the appropriate manager. He had

no recollection of ever having seen a copy of any terms and conditions of the defender or

any other contract from them. He had, supported by other members of the administrative

team, trawled through the pursuer’s physical archives and no trace of any copy of the letter

dated 30 July 2012 or the terms and conditions had been found. While generally records are

kept for six years before shredding them, when they went to check the archives for 2012,

these had not yet been destroyed. Files of all supplier statements, sales invoices and

delivery notes from 2012 were still there. Some records from that year, probably old

timesheets, picking records and quality control files would have been destroyed but the

primary financial records, sales and purchase invoices, year-end accounts and the like had

been retained. The documents were kept in a shipping container. There were about 60 to

80 boxes. He had checked for the years outside 2012. The witness commented on the

incorrect aspects of the address in the letter dated 30 July 2012. A letter that may have been

sent addressed simply to the farm could have been delivered to any one of the other

properties on the farm. His own home address has the same postcode as the pursuer’s farm

office. Quite often the office would receive mail for another property with the same

postcode, to the extent that a box was kept in the office for returned mail. He had no doubt

that poorly addressed mail for the LLP may well have been delivered to another location.

Specific terms and conditions for a particular supplier was not something that he would

keep in his own file. He had no recollection of passing this letter or any terms and

conditions to any manager. If Kenny Shellard was not there it would have gone to

Gary Bruce; there was a small chance of that having occurred. The file of invoices from 2012

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had also been searched. In relation to the request for an email in the letter dated 30 July

2012, as the company’s accountant he would have responded to that request. He accepted

that there were various invoices stating that the all business with the defender is subject to

standard conditions of sale and that several of these noted the customer as “Windy Hills

Farm”. He thought if this had come to his attention he would have asked Kenny Shellard or

Susan Spink to have this corrected by the defender, but it may not have been something he

focused upon. It was correct that there was only one Windyhills farm. But in the year from

September 2011 to August 2012 six of the twenty-two invoices that had been posted to the

pursuer by the defender had not been received.

[13] Gary Bruce is the pursuer’s farm manager and has occupied that post for some

17 years. He has always been based in the farm office, spending about half his time in the

office and the rest out on the fields. Any mail coming in to the farm office would be picked

up and opened by Susan Spink. She would organise the mail depending upon the

department it related to before normally passing it through to him and he would distribute

it. Sometimes, if mail clearly related to a particular department (eg fruit) then Susan would

put this straight onto the appropriate team manager’s desk. Although he was not directly

responsible for processing mail, he was aware of difficulties with mail being delivered to the

wrong addresses in the past. It would largely depend on which postman was working.

Sometimes the office would receive mail that was intended for one of the neighbouring

cottages and vice -versa. He was in no doubt that on occasions mail meant for the office may

have been received elsewhere. His own files were in the farm office but these relate solely to

cereals, potatoes and vegetables. If anything related to the defender had landed on his desk,

then he would have passed it straight to Kenny Shellard, as it would concern the fruit side of

the business. He had never seen the letter dated 30 July 2012 or the terms and conditions.

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Had Kenny Shellard come to him to ask what should be done in relation to the letter or

terms and conditions then he would have considered these and would have spoken to

Peter Stirling about them. That sort of thing occurred infrequently, and had it taken place he

would have remembered any such discussion. He had no recollection of Kenny Shellard

ever raising issues about written correspondence. Susan Spink did not work on a Friday.

When she was not there, the mail was brought in by the postman and left on his desk and he

would take it through and leave for her to open on her return. Another member of staff

would deal with it if Susan Spink was on holiday, but would not distribute the mail. He had

every confidence in the process and was unaware of any issues with letters going missing. It

was a thorough and diligent procedure. Mail in the office was dealt with properly. He

would get mail at his cottage which was intended for the farm, maybe three or four times a

year. If he realised that it was intended for the farm, he would take it to the office and give

it to Susan Spink. Residents in the other cottages would have brought up mail that was

intended for the farm. If the letter and the terms and conditions had come in, these would

not have been passed to him but would have gone to Kenny Shellard.

Witnesses for the defender

[14] Elaine Thorely has worked for the defender for some 30 years and is currently

employed in accounts administration. She is responsible for sending out the invoices to all

of the company’s customers, including the pursuer. She was off work due to illness from the

beginning of June 2012 to the end of October 2012, but apart from that period she would

have sent out all invoices to the pursuer. The filing system for invoices goes back to 2002

and from then, until the defender was informed of the change of business from the LLP to

the pursuer in 2016, all invoices were addressed to “Windy Hill Farm” at “Authmithie” in

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Arbroath, that is, with the same address details and postcode as in the letter dated 30 July

2012. On her calculation, 117 invoices were sent to that address and postcode. She was not

aware of having been told that there were problems with receipt of invoices by post, but on

a couple of occasions the pursuer had asked the defender to provide copy invoices. On

9 February 2012 she sent an email to Susan Spink attaching six invoices dated from

26 September 2011 to 24 January 2012. Having searched her sent emails, this was the only

one sending copy invoices. As far as she was aware, no complaints were made that the

name or address on the invoices had caused any problems about them being received. The

system showed that all of the invoices that had been posted had been paid. It was put to her

that Susan Spink’s evidence was that she had told the witness that the invoices requested

had not arrived, but the witness maintained that while copies were asked for, no reason was

given. It was possible that Ms Spink had said that they hadn’t been sent but they had

probably been asked for because the defender was chasing money.

[15] Glenn Notley has worked for the defender since February 2008 and is currently the

managing director. He normally dealt with orders from the pursuer. He explained the

exchanges between him and Kenny Shellard in mid-2016 regarding the order for polythene

sheeting. In his time with the defender, it had supplied many products to the pursuer and

subsequently sent many invoices. The defender’s original terms and conditions were set up

long before he joined the company. During Stephen Mortimer’s time as managing director,

a decision was made to re-send a copy of the terms and conditions to every customer on the

database. Advice was obtained from the defender’s solicitors and the terms and conditions

were posted to every customer. As he understood it, this was done because there were

several companies on the company’s database who had not returned signed account forms

and it was designed to make sure every customer had at least seen a copy of the terms and

Page 17 ⇓

conditions. Many new accounts had been established by this time. Every invoice sent by

the defender to the pursuer made reference to the terms and conditions and stated that all

orders are covered by them. Invoices addressed to Windy Hill Farm were paid by

Peter J Stirling Limited or its predecessor. That was the only address the defender had for

the pursuer until April 2016. From 15 April 2016, invoices were addressed to Peter J Stirling

Limited. On the defender’s system the pursuer is described as Windy Hill Farm and the

customer number starts as “WH “. The pursuer’s staff must have indicated the name. It had

never been suggested by the pursuer that the name was incorrect. He was not aware that

the terms and conditions referred to in July 2012 were new terms and conditions. The

decision was to send them out to every customer on the list. There were just over

1000 customers, with the pursuer as number 972. He was not part of the process of issuing

the terms and conditions at that time and it was people in the office who did the posting.

The copy of the signed version of the letter dated 30 July 2012 that had been lodged as a

production was electronically stored on the defender’s server and bore to have been created

at 1.35pm and saved on the server on that day. The witness was not aware whether

Mr Mortimer had signed the letter or whether it was an electronic signature, but it was

possible that he had physically signed all of the letters. The witness accepted that there was

an email dated 1 August 2012 from the solicitor which referred to an amendment to the draft

letter, suggesting that the letter might have gone out after that date. He was not aware of

any issues with certain documents not making their way to the pursuer in 2012. Lots of

customers asked for invoices and delivery notes and that was often just a way of delaying

payment. The request by the pursuer for copy invoices was far more likely to be a delaying

tactic, although there were many reasons why people might ask for copy invoices. The

pursuer was not the best of payers. There was no reason for him to mention terms and

Page 18 ⇓

conditions to Mr Shellard; that was not his job and it had never crossed his mind to tell

Mr Shellard. He did not think it possible that the letter dated 30 July 2012 was not issued,

although it was possible that it didn’t arrive. The letter had, based on what he had been

told, definitely left the defender’s office, as it did to all the other 1,002 customers. He was

unaware of what was said on invoices issued before he joined the company. There was no

reference to the terms and conditions in the emails he had sent after the problem with the

polythene sheeting had arisen. That was not relevant at the time, as he had been asked by

Peter Stirling to speak to the defender’s insurers. He rejected the suggestion that one reason

for not mentioning the terms and conditions was that he did not think the pursuer was

subject to them. All of the letters sent to customers had been saved individually. He was

99.9% certain that the letter had been sent to the pursuer. After the problem arose,

Mr Stirling had been told that the terms and conditions did not allow set-off in respect of

other debts owed to the defender and a sum due (£30,000) which had been retained was

then paid, said by Mr Stirling to be “as a gesture of goodwill”. He was not aware of mail

ever being returned to the defender as undelivered.

[16] Miki Foster works as an administrator for the defender, having started in 2011 as an

office and warehouse assistant. Credit control was added to her role in the following year.

A customer’s credit account was set up by sending out an account form. Quite a few

customers had never completed or signed an account application form. Following

discussions involving the then managing director Stephen Mortimer and the company’s

accountant, the defender sent the terms and conditions out to every customer, so that no one

could say that they hadn't received them. The letters were all produced by way of a mail

merge of all the customer names and addresses from a spreadsheet, put into the letters as

word documents. She had folded the letters up and franked them and sent them out, with

Page 19 ⇓

the terms and conditions attached. This was done over two or three days. All of the letters

were sent out. If anyone was not at the address, the franking postmark had the defender’s

address on it, and the letter would have been returned. There were letters which came back

and when that occurred the company would suspend the account and note that the

customer had moved away. A letter to the pursuer dated 15 July 2016 reminded the

customer of the terms of credit allowed by the defender’s terms and conditions, although a

copy of the terms and conditions was not sent with that letter. She was never asked by the

pursuer or its predecessors to provide a copy of the terms and conditions. She had no

particular recollection of sending the letter dated 30 July 2012 to the pursuer, but more than

1000 letters were sent. It was possible, but very unlikely, that the letter to the pursuer had

not been in the bundle given to her, as the letters were produced for every customer. There

was no reason for any particular letter to go missing over the two to three day period when

they were being sent out. Other people had no reason to go into her room. The envelopes

had a “window” and each letter was folded up so that the address on the letter was seen

through the window. She checked every letter. To the best of her knowledge every single

letter went out. She would have been aware of the letter being returned, had that happened.

About ten to twenty of the letters came back. When Ms Spink contacted the defender to ask

for invoices, that may or may not have been for invoices not received.

[17] The parties agreed that the witness statements of two solicitors, who in 2012 worked

for a firm in Hull which advised the defender about the new terms and conditions, were to

be treated as the evidence of these two witnesses in this proof. Their evidence concerned

discussions with and advice given to the defender about changing its terms and conditions

and notifying these to customers.

Page 20 ⇓

Assessment of the evidence

[18] Overall, the witnesses, some of who had much closer connection with the issues in

dispute than the others, gave their evidence in an open and straightforward manner. I

found their testimony to be credible and reliable and indeed no significant contentions in

that regard were raised by the parties. By and large, with some minor exceptions, they each

restricted their evidence to the limited range of matters to which they could properly speak.

These were matters that occurred more than eight years prior to the proof and it was

therefore not unusual that precise details of what occurred were, on occasion, not able to be

fully explained.

Submissions

Submissions for the pursuer

[19] The submissions on behalf of the pursuer can be summarised as follows. The onus

was on the defender to establish that its terms and conditions formed part of the contract:

Grayston Plant Ltd v Plean Precast Ltd 1976 SC 206 (at 207). The terms of the contract were

agreed in communications by the parties between 27 June 2016 and 13 July 2016. The terms

were also supplemented by implied terms, as inserted into the contract by the Sale of Goods

Act 1979. The defender agreed that the parties had a concluded contract in mid-2016 but

argued that Mr Notley and Mr Shellard did not agree on “many of the aspects of the

contract”. The pursuer disputed that; what the parties agreed was clear from their

correspondence, as that correspondence would be understood by the reasonable person with

the knowledge of the parties. A mid-August delivery date from the defender to the pursuer

was agreed. As confirmed by Mr Notley in his oral evidence, the defender knew where the

pursuer traded from. There was no warrant for adding in other terms.

Page 21 ⇓

[20] The defender had not established that its terms and conditions were sent to the

pursuer in or around late July 2012 or early August 2012. The defender had not been able to

produce any evidence that a letter enclosing the terms and conditions was actually sent by it

to the pursuer. No record had been produced recording when or to whom letters were sent.

There was a clear possibility that it hadn’t been sent. The provenance of the document was

questionable. It had apparently been generated before the lawyers gave approval. The

letters were left unattended over a three-day period in a room where anyone in the team

could have had access to them. The defender required to establish that its processes were

robust such that the court could infer that the letter to the pursuer was printed and was

given to Ms Foster. No such evidence was led of that process.

[21] The pursuer objected to any evidence being led about the document described as the

letter dated 30 July 2012. The basis of the objection was the best evidence rule. Reference

was made to Scottish & Universal Newspapers Ltd v Gherson’s Trustees 1987 SC 27 (at 46); Japan

Leasing (Europe) PLC v Weir’s Trustee (No 2) 1998 SC 543 (at 546H - 547B) and Dowgray v

Gilmour 1907 SC 715 (at 719). The best evidence rule excluded secondary evidence if

primary evidence was, or ought to be, available. An oral description of real evidence is

inadmissible unless it is not practicable and convenient to produce the real evidence. It

appeared from the evidence that the production is a copy taken from the defender’s records.

The nature of the document was not known (whether it was a hard copy, a copy of a copy,

or a print of an electronic document such as a pdf, or of an electronic document that is not a

pdf). It was also not known how and when the copy was made and whether the signature

of Mr Mortimer is an actual signature or an electronic image. The defender had not

established that the document produced is the best evidence available of what is in its

records. If the document is an electronic document, the best evidence is the electronic

Page 22 ⇓

document which should have been lodged on a memory stick and this would therefore

disclose when it was created and by whom and whether it had been edited. There was no

reason why the principal (electronic) record Mr Notley says was retained by the defender

could not have been produced, given the potential importance of this document. The

electronic files were not produced and no good reason was given for not producing them.

Testing the evidence had been denied to the pursuer. The electronic document’s metadata

might indicate whether it had been printed and, if so, when. The same kind of problems

arose with the database referred to by Ms Foster. If a document is critical then a copy will

not suffice; the onus is on a party to produce the document on which it relies.

[22] Further, it had not been established that the letters were sent to everyone else. It was

important to note that there may be other customers who, like the pursuer, had no notice of

the terms and conditions but did not have problems with any products purchased. As such,

whether or not they had received the terms and conditions might not yet be apparent. The

lack of records on this matter produced by the defender meant that there was really no way

to know whether the problem the pursuer had with receipt was a problem other customers

may also have had.

[23] The presumption of receipt of the letter relied upon by the defender is based upon

Stewart v Wright (1821) 1 S 203 and Chaplin v Caledonian Land Properties Ltd 1997 SLT 384. In

these cases there was direct evidence, which the court accepted, of the document in question

having specifically been posted. In Tullis Russell & Co v Eadie Industries Ltd (unreported,

31 August 1999) Lord Macfadyen held that for posting to be established for the postal

acceptance rule “clear and specific evidence that the particular document was posted” was

necessary (para [57]). In Robertson v Gamack (1835) 14 S 139 the court effectively held that all

the evidence that could have been led was led. That was not the case here. The defender

Page 23 ⇓

had not established that its terms and conditions were sent to the pursuer and so no

presumption arose.

[24] If it was necessary to rebut that presumption, the evidence sufficed to do so. There

was direct evidence that the relevant personnel at the pursuer did not see the letter and its

alleged enclosure. Had these items been received, the pursuer’s witnesses were clear that

they would not have been disposed of but would have been retained. A thorough search

had been carried out to locate the documents. Further, the letter was not responded to,

despite it having requested a response. Also, there were other instances of mail not reaching

the pursuer. This included the six invoices that Ms Spink asked to be sent to the LLP on

9 February 2012 because they had not been received. The problem of mail sometimes going

missing was potentially compounded by the incorrect address. It could not be said on the

balance of probabilities that the pursuer received the terms and conditions. Insofar as there

is a presumption that the pursuer must rebut, the pursuer had rebutted it.

[25] In any event, if the terms and conditions did form part of the parties’ contract, there

was no specific consent to the jurisdiction clause. Reference was made to section 16 of the

Civil Jurisdiction and Judgments Act 1982 and to paragraph 6 of Schedule 8. In interpreting

the meaning of these provisions, EU law must be applied and it made clear that specific

consent must be identified in order for jurisdiction to be prorogated. It was not enough that

the clause forms part of the contract. Reference was made to Bols Distilleries BV v Superior

Yacht Services Ltd [2007] 1 WLR 12 (paras [22] – [23) and 7E Communications Ltd v Vertex

Antennentechnik GmbH [2007] 1 WLR 2175 (paras [26] - [37)]. There was in this case no

signed document at all and therefore nothing in writing. Separately, there was nothing in

this case to demonstrate specific consent to a jurisdiction clause within the scope of the

Page 24 ⇓

parties’ relationship that would bring the case within paragraph 6(2)(b). The jurisdiction

clause was not therefore enforceable even if it formed part of the parties’ contract.

[26] The pursuer also objected to reliance upon an alternative basis for incorporation of

the terms and conditions, which the defender may seek to argue, namely incorporation in

the course of business as a result of the pattern of invoices which referred to the terms and

conditions. The grounds for this objection were a lack of pleadings on this alternative

ground and a corresponding lack of fair notice to the pursuer, and separately, the best

evidence rule. Reference was made to Lothian Amusements Ltd v The Kiln’s Development Ltd

[2019] CSOH 51 (paras [46] – [47] ); Grayston Plant Ltd v Plean Precast Ltd 1976 SC 206 (at 217);

M’Crone v Boots Farm Sales Ltd 1981 SC 68 (at 72 - 3). The invoices had not been produced,

there was no good reason for that lack of production and their terms could not now be

proved by parole evidence. The invoices were said to be critical documents to the argument

the defender now wished to advance. While the pursuer may have stored the invoices, the

defender did not timeously call on the pursuer to produce them. In the course of the proof,

the pursuer also objected to a question asked on behalf of the defender to Mr Notley about

Mr Stirling having authorised payment of withheld sums after being told that the terms and

conditions did not allow such set-off and that objection was maintained in submissions.

Submissions for the defender

[27] The submissions for the defender can be summarised as follows. The contract for

purchase of the polythene was formed by a combination of discussion between Mr Shellard

and Mr Notley in person and by their email correspondence. Mr Shellard and Mr Notley

did not attempt to reach any express agreement about many of the aspects of the contract,

including the precise date of delivery, payment terms, warranties or retention of title. The

Page 25 ⇓

defender’s terms and conditions were incorporated expressly into all future contracts of sale

with the pursuer as a result of their intimation with the letter dated 30 July 2012. The

majority of the pursuer’s witnesses focused on matters that were really of no moment, for

example on the incorrect identification of the name of the farm. This would not have caused

any confusion or led to a failure to deliver. The pursuer at no time made an issue about the

incorrect address. For years, trading took place, with invoices bearing this address being

received and audited by Mr Mann for tax purposes without objection. It was clear that

business correspondence received by other residents within the farm is likely to have ended

up at the farm office, either because it was obvious that it was intended to go there from the

address, or because upon opening the envelope, the contents were clearly for the farm

business. The pursuer requested that invoices be sent by post and not email, thereby

indicating that post was found to be more reliable than email. The simple explanation was

that there was either an office error or a systems error by the pursuer which meant that the

terms and conditions were not properly taken account of within the office, or perhaps were

misfiled.

[28] There was a clear explanation by the defender’s witnesses of the system employed in

sending out the letters with terms and conditions. The probability of one letter dropping out

of the system was fanciful. It was highly likely, and certainly the case on the balance of

probability, that a letter with terms and conditions was put in the postal system addressed

to the pursuer.

[29] The reliance in the written submissions on the alternative ground of incorporation of

the terms and conditions as a result of a course of dealing was no longer founded upon.

However, it was surprising that the repeated reference in the many invoices sent to and

received by the pursuer to terms and conditions raised no query from the pursuer.

Page 26 ⇓

[30] The evidence supported the defender’s position. The pursuer would not have been

registered on the defender’s system without having completed a customer account form.

In 2011, the defender sought legal advice on its terms and conditions from a solicitor who

sent a draft of the terms and conditions to the defender’s accountant, Nigel Rock. The plan

was to send out the new terms and conditions to all existing and new customers of the

defender. The solicitor finalised the terms and conditions and then on or about 30 July 2012,

Miki Foster, the defender’s administrator, sent the letter to the pursuer enclosing the terms

and conditions. Ms Foster described a system of producing letters to customers using a mail

merge system and dispatching them. There was no evidence that she departed from that

system in relation to the letter to the pursuer. The draft of the mail merge letter bears the

date of 26 July 2012. The copy of the letter dated 30 July 2012 on the defender’s server was

last modified on that date. The franking stamp on the letter bore the name and address of

the defender. Ms Foster sent out similar letters to all of the defender’s existing customers.

Some 1000 individual letters were stored. It was utter speculation to suggest that the letter

to the pursuer did not go out. A small number of letters were returned as undelivered, upon

which she suspended the defender’s account with the customer to whom the letter had been

addressed. She was not required to take any such steps for the pursuer.

[31] The evidence proved that the letter was dispatched by Ms Foster and the usual

presumption of fact that the letter was delivered should apply: Stewart v Wright; Chaplin v

Caledonian Land Properties Ltd. In light of that presumption, the onus was firmly upon the

pursuer to establish that it did not receive the letter. The pursuer’s evidence was really just

that no-one could recall the letter coming in and no-one could now find it. None of these

potential explanations carried any weight. The defender had traded with the pursuer’s

predecessor from around 2002, when the pursuer used the descriptive name “Windy Hill

Page 27 ⇓

Farm”. After incorporation of the LLP, Susan Spink requested that certain invoices be re-

sent by the defender. These were sent on 9 February 2012. They were addressed to “Windy

Hill Farm” and post-dated incorporation. During the whole period of incorporation of the

LLP, the defender sent its invoices to the LLP designed as “Windy Hill Farm”, yet no

attempt was made by the pursuer to have the defender correct its records. It was to be

inferred that if there was any continuing difficulty with invoices not being delivered to the

pursuer because they were incorrectly addressed, the pursuer would have raised the matter

with the defender. The postal address of “Windyhills, Auchmithie” continues to be used by

the pursuer’s director, Peter Stirling, as his service address with Companies House. It was

unlikely that he would use a description of an address that he had found unreliable. The

difference between that address and “Windy Hill Farm, Authmithie” was not significant.

The post is likely to have been directed to that area by the postcode. There was no evidence

of another farm in the vicinity with a similar name. There was no evidence that mail

addressed to “Windy Hill Farm, Authmithie” was likely to be delivered to somewhere else

because of any such errors.

[32] Moreover, there was only evidence of mail wrongly delivered to other addresses

within the farm’s postcode; there was no evidence of mail being delivered to premises with

a different postcode. On the evidence of Mr Bruce, it could be concluded that any items of

mail for the pursuer incorrectly delivered to any of the other properties on the farm would

have been handed into the farm office. There were many possible reasons why the pursuer

might not have retained a copy of the letter. It might have been misplaced, misfiled or

discarded. The pursuer did not have a system of recording all incoming mail. Susan Spink

ordinarily opens the mail, but was not present in the office on several dates in early

August 2012. If the letter was sent on 30 July 2012 from Yorkshire, it could have arrived on a

Page 28 ⇓

date when she was not there. The evidence of where the letter might have been directed

after it was opened was confused. There was no evidence of where general correspondence

and marketing materials, such as brochures, from suppliers were filed by the pursuer.

Mr Mann said that some documents will have been destroyed. The invoices dated 2011

and 2012, addressed to “Windy Hill Farm, Authmithie” bear the same address as those sent

to the pursuer in 2015. They both bear the same customer account number of WIN626. It

can be inferred that the address held on the defender’s customer database was not corrected

over the course of four years. At best for the pursuer, it might be inferred that four invoices

in late 2011 and early 2012 and one in 2015 were not delivered. The evidence did not

suggest there was a continuing problem of mail failing to arrive. Other explanations were

equally, if not more, probable: (i) that the invoices requested in 2012 had already been

received, but copies were requested for some reason relating to payment; (ii) the invoice re-

sent in 2015 was not in response to a request at all, but was a means of the defender chasing

payment. Invoices addressed to “Windy Hill Farm, Authmithie” were paid by the pursuer.

It could be concluded that they were received by P J Stirling LLP and, later, the pursuer. In

the circumstances, the pursuer had failed to rebut the presumption that the letter, having

been duly sent, was received by it in early August 2012.

[33] The objections made on behalf of the pursuer lacked substance. In this case it was

impossible to produce the actual evidence. The defender had produced the best evidence it

could. The actual letter was copied and stored. If the pursuer wished to have some form of

electronic interrogation of the records kept, or wished to recover the metadata, that could

have been requested. The best evidence rule is not a general exclusionary rule of evidence,

but rather has its basis in the proposition that “a party must adduce the best attainable

evidence of the facts he means to prove”: Dickson on Evidence, paragraph 195. For the

Page 29 ⇓

reasons explained by Lord Macphail in Haddow v Glasgow City Council 2005 SLT 1219, it is no

longer the law that the evidence tendered must be the best attainable. The governing

principle is that the evidence must be sufficiently relevant to an issue and must not infringe

any of the exclusionary rules. It was uncontroversial that the document is fundamental to

the matters at issue in this proof. The rule against proving the content of a document by

secondary evidence is a different exclusionary rule from the “best evidence rule”. Japan

Leasing and Scottish & Universal Newspapers Ltd are examples of aspects of that exclusionary

rule, although neither were engaged in the circumstances of this case. The pursuer’s

objection raised an issue addressed in the recent case of Promontoria (Henrico) Ltd v Friel 2019

SLT 153. Similar points applied to the objection to Ms Foster’s evidence about the mail

merge.

[34] Condition 11.2 of the terms and conditions states that “all disputes arising out of this

contract shall be subject to the exclusive jurisdiction of the courts of England and Wales.” In

terms of the Civil Jurisdiction and Judgments Act 1982, Schedule 4, Article 12(1), the parties

prorogation of jurisdiction is binding and exclusive: Cook v Virgin Media [2016] 1 WLR 1672.

There was no international element in this case and the authorities relied on by the pursuer

were not applicable. It was incorrect as a matter of law to say that there needed to be

specific acknowledgment regarding a clause dealing with jurisdiction: Bols Distilleries BV v

Superior Yacht Services Ltd. Objectively the issue was whether the pursuer was aware of the

provisions on jurisdiction. Positive acceptance was not required. It sufficed if there was

agreement to any clause conferring jurisdiction.

Page 30 ⇓

Decision and reasons

Objections

[35] In relation to the copy of the letter dated 30 July 2012, the pursuer’s objection was “to

any evidence being led about production 7/7”, including evidence as to the provenance of

this production. The ground for objection was the best evidence rule. There is no

suggestion on the part of the pursuer that the document is false or in some way fabricated.

As it was put in the note of objections:

“The best evidence rule is engaged because the Defender has not established that the

document produced is the best evidence available of what is in its records. If the

original copy was a hard copy, the best evidence would be the principal photocopy

taken at the time (which would disclose whether the signature was on the copy

document or the document of which it is a copy). If the document is an electronic

document, the best evidence is the electronic document lodged on a memory stick

(which would therefore disclose when it was created and by who and whether it had

been edited). There is no reason why the principal record Mr Notley says was

retained by the Defender could not have been produced, given the potential

importance of this document.”

[36] I have had some difficulty in understanding the intricacies of the second sentence of

this ground of objection, but the general background is tolerably clear. The production itself

is in paper form. On the evidence in the witness statement of Mr Notley, it was “a copy

letter … taken from our records” and in the statement of Ms Foster all of the letters were

“produced … by mail merge”. As the pursuer noted, it is not plain from the production

itself whether it is a copy of the original letter, or is a print of a scanned copy or

electronically stored version of the original letter. It is also not clear whether the letter was

signed by hand or signed electronically, although as it is a document said to be contained in

records from some eight years ago, it is perhaps understandable that evidence could not be

given on whether it was physically or electronically signed.

Page 31 ⇓

[37] Nonetheless, I reject the pursuer’s objection insofar as it seeks to exclude any

evidence concerning production 7/7. The scope and extent of the exclusionary rule as

applied in the cases referred to by the pursuer is limited. In Scottish & Universal

Newspapers Ltd v Gherson’s Trustees the objection was to oral evidence about the content

of missing records. Lord President Emslie stated (at 47):

“secondary evidence of the contents of the missing records will be admitted only if it

is shown that they have been destroyed or lost without fault on the part of the

pursuers who had effective control of the records when the action began.”

In Japan Leasing (Europe) PLC v Weir’s Trustee (No 2), a witness for the pursuer gave

evidence that he believed that the principals of certain documents of which copies had been

lodged were with the pursuer’s solicitors in London. There was no question of the

principals having been lost or destroyed or of that having occurred without fault on the part

of the pursuer. The secondary evidence was therefore not allowed. I note, in passing, there

is now some room for questioning the scope of the exclusionary rule (Promontoria (Henrico) v

Friel [2020] CSIH 1 (at [44]). But in any event in the present case, understandably, the

pursuer did not suggest any fault on the part of the defender in losing the actual document,

as the original letter is said to have been sent. On the evidence the loss or absence of the

original letter for the purposes of the proof occurred without such fault. It is clear from the

authorities that the party seeking to rely on secondary evidence about the document must

have averments as to its loss or absence. Those are made in the present case. Thus, the

circumstances here allow the defender to seek to prove the terms of the document

“incidentally”, as it is put in some of the cases and textbooks. The defender was certainly

entitled to lodge a copy of the production concerned and seek to use that as secondary

evidence of the terms of the original document. It is correct that the production is not

Page 32 ⇓

certified as a true copy (as can be done under section 6 of the Civil Evidence (Scotland)

Act 1988) but even taking the authorities as they stand that does not bar secondary evidence

being admitted of this document, given that it was, on the evidence, lost or absent through

no fault on the part of the defender. However, the best evidence rule also seems to be relied

upon on by the pursuer on the basis that rather than, or in addition to, a hard copy of the

production the version of it in electronic form exists. This, it is argued, could have been

lodged by the defender thus allowing access to metadata, such as the properties of the

document. But the practical reality is that the production before the court is said to be

simply a copy of what was sent, to all intents and purposes of the same general nature as a

photocopy. To require every document of materiality in a proof to be lodged in its actual

original electronic version on, for example, a memory stick goes too far and is not required

by the authorities. I accept that further oral evidence was led about the electronic creation of

the document and I shall deal with that below. However, in this commercial action the issue

of requiring the electronic version of the document to be lodged was not raised before the

court in advance of the pre-proof by order. The Lord President explained in Promontoria

(Henrico) v Friel ([36] and [37]), although in the different circumstances of a case involving

proving the tenor and there being a certified copy of the document, that in a commercial

action the court would expect a challenge to be clearly flagged as an issue at the stage of the

preliminary and procedural hearings. Similar considerations apply in the present case. The

document was lodged three months prior to the proof. If the pursuer wished to question or

investigate the provenance of this production, it could have, in advance of the proof, moved

for further specification (including in witness statements) of its provenance or sought

recovery of further material such as metadata. The pursuer did not do so and indeed the

note of objections was lodged very shortly before the commencement of the proof. It is not

Page 33 ⇓

appropriate in these circumstances to exclude all evidence about this crucial production and

I therefore conclude that the objection is not well-founded.

[38] The next line of objection concerns oral evidence given, beyond what was said in the

witness statements, as to the provenance of the document. Where the posting of a crucial

letter is not admitted and therefore falls to be proved, and the sender wishes to lead

evidence about the properties of the document which show the time and date of its creation,

that evidence would ordinarily be expected to appear in a witness statement, rather than (as

occurred here) being stated for the first time in oral testimony at the proof. The lack of fair

notice on these important matters means that I shall sustain the objection to that limited

extent. In relation to the objection to Ms Foster’s evidence about the mail merge process, I

do not regard that as well-founded. She simply explained in a little more detail a point

already made in her witness statement.

[39] The next line of objection taken by the pursuer related to evidence supporting the

apparently alternative ground of incorporation of the terms and conditions, foreshadowed

in the note of argument for the defender lodged prior to the proof: incorporation as a result

of a course of dealing rather than as a consequence of the letter dated 30 July 2012. In the

event, senior counsel for the defender did not insist upon such an alternative line of

argument. If it had been advanced, I would have been inclined to sustain the objection on

the basis of a lack of fair notice in the pleadings of such an alternative proposition (which, as

the pursuer submitted, is illustrated in the approach taken by Lord Doherty in Lothian

Amusements Ltd v The Kiln’s Development Ltd [2019] CSOH 51, at paras [46] – [47] ).

[40] The pursuer also objected to a line of evidence that Mr Stirling released sums which

had been retained because he received a copy of the terms and conditions from Mr Notley’s

solicitors (making the implicit assertion, argued the pursuer, that Mr Stirling had in that

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regard acted in a way inconsistent with his company’s position in this action). While I

accept that the relevant correspondence on this point is not before the court and

Mr Stirling’s evidence on it was not heard, the evidence was really only about limited

discussions after the dispute arose. Mr Notley said that the money was released by

Mr Stirling “as a gesture of goodwill”. This does not imply a different position in relation to

the terms and conditions than that taken by the pursuer in the action and I did not

understand the defender to suggest that it had that effect. I do not regard the evidence as

objectionable but it is in any event of no significance in relation to the issues in dispute, to

which I now turn.

Was the letter dated 30 July 2012 sent by the defender?

[41] The case law on the evidence required to activate the presumption of receipt of a

posted item is clear. As Lord Rodger stated in Chaplin v Caledonian Land Properties Ltd

(at 387B-D):

"In my view once the petitioner has satisfied me that the letters of 14 August and

23 October 1992 were posted, then a presumption arises that they were duly

addressed and delivered to the office of Bell Ingram. That presumption can be

rebutted by evidence which satisfies the court that they were not so delivered.

Counsel for the respondents argued, rightly in my view, that proof of a system

operated in the office of Bell Ingram might be relevant in this regard.”

[42] As counsel for the pursuer submitted, in Tullis Russell & Co v Eadie Industries Ltd

Lord Macfadyen had to determine which party’s terms and conditions were incorporated

into a contract. One of the issues to be decided was whether an order acknowledgement, of

which there was a copy on the defender’s file, had been sent. This issue arose in relation to

what is described as “the postal acceptance rule”: that proof of postage of an acceptance

constitutes an acceptance even if it is not received. As is noted at paragraph [38] in the

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Opinion, evidence was led of the general practice of the defender that such documents

would have been sent. Lord Macfadyen held that the “general evidence” as to practice was

insufficient for a finding that the particular document had been posted and concluded that

for posting to be established for the purposes of the postal acceptance rule “clear and

specific evidence that the particular document was posted” was necessary (para [57]). On

behalf of the pursuer, it was submitted that “Lord Macfadyen is right to insist on a high

degree of evidence before one can conclude that a document concluding a contract has been

posted”. That submission reflects the point that the decision in Tullis Russell & Co was

dealing with evidence of posting which would, if accepted by the court, result in a contract

being entered into (rather than, as here, a presumption arising) and Lord Macfadyen’s

comments must be viewed in that context. In any event, I do not regard Lord Macfadyen’s

approach as putting some form of gloss, or higher test, on the requirement of proof of

posting in a case such as the present, which is something that will fall to be determined on

the balance of probabilities. Earlier in paragraph [57], prior to making the observations

founded upon by the pursuer, Lord Macfadyen stated:

“Before the rule can apply, however, there must in my view be a sufficient evidential

basis for a finding in fact that the order acknowledgment was committed to the post

by the defenders. The only evidence on which such a conclusion could be based was

… that an order acknowledgment, once typed, would be posted to the customer.

There was no specific evidence that the particular order acknowledgment was in fact

posted to the pursuers. In my opinion, though I have no reason to doubt the general

evidence given … as to practice, that evidence is an insufficient basis for a finding

that the particular order acknowledgment was actually posted to the pursuers.”

Lord Macfadyen’s comments were therefore made in the context of an absence of evidence

about actual posting of the particular item. In the present case, there was evidence about the

actual posting of the items in the bundle of mail which was to be sent to all customers. That

is evidence of actual events rather than general evidence as to practice. Counsel for the

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pursuer accepted that in certain cases it might be possible to prove that a business had a

sufficiently robust internal process, so that the court could determine that a document was

posted without direct evidence to that effect (eg Robertson v Gamack). But counsel argued

that in that case all the evidence that could have been led was led, whereas in the present

case there were many things that could have been done, but about which there was no

evidence, to provide a proper basis to conclude that a letter was sent to the LLP as the

defender contends.

[43] In circumstances such as the present, I do not regard it as necessary to have direct

evidence that the specific individual item, the letter dated 30 July 2012, was posted. The

evidence of Ms Foster, which was credible and reliable, was that a bundle of letters to be

sent to each individual customer was prepared, there being more than 1,000 customers. The

letters were printed off and she folded each letter, placing it an envelope, and the envelopes

were then franked and put in the post bag. Accordingly, as I have noted, this is not merely

evidence of the general practice of the defender; rather, it is evidence of a materially

important commercial exercise (the notification of terms and conditions to every customer),

that took place over two or three days. It involved senior members of staff and was done on

the basis of specific legal advice given by the company’s solicitors about the need to send

such letters to each customer.

[44] It is correct that no record was produced showing to whom letters were sent and

when, but the evidence was that no such record was kept. Rather, copies of the letters sent

were stored on a computer. It is also correct that that there was an email dated 1 August

2012 from the solicitor which referred to an amendment to the draft letter, after the letter to

the pursuer had apparently been sent, but that does not demonstrate that a letter dated

30 July 2012 was not sent on that day or over the next couple of days. It is also true that no

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evidence was led that the letters were received by all of the other customers and it was

submitted that if other customers did not have problems with any products purchased, the

issue of receipt of terms and conditions may well not have arisen or been considered in

relation to those customers. But evidence of receipt by other customers (unless by virtually

all) would be of little assistance in determining the issue in this case. Ms Foster’s evidence

was clear and there was nothing to show that she could have departed from her approach in

relation to the letter to the pursuer. The franking stamp on the letter contained the

defender’s name and address and if it had not been received it would have been returned.

A small number of letters were in fact returned, but the letter to defender was not. While I

disregard the evidence as to the provenance of production 7/7 that was not covered in the

witness statements, I accept and take into account the evidence that it was produced by

mail-merge and contained within the records of the defender, along with some 1,000 other

letters. The item produced is signed by Mr Mortimer (whether by hand or electronically)

who was the Managing Director at the material time. The evidence of Ms Foster was that

there was no basis for any particular letter to go missing and other people had no reason to

go into the room in which the bundle of letters had been placed. I conclude that I have no

grounds for finding that the letter was not printed-off and sent to the pursuer and on the

contrary that there is clear evidence of that having occurred. I am therefore satisfied that

there is a sufficient evidential basis for finding that the letter dated 30 July 2012 was posted.

The defender has discharged the onus of proof on that matter.

Was the letter dated 30 July 2012 received by the pursuer?

[45] As a consequence, the presumption that the letter was delivered to the office of the

pursuer arises, although it is capable of being rebutted by evidence which satisfies the court

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that it was not received. The onus is on the pursuer to rebut that presumption. As

Lord Rodger observed in Chaplin v Caledonian Land Properties Ltd, proof of a system operated

in the defender’s office might be relevant in this regard. While there was a slight

inconsistency as to precisely to whom this letter would have been passed, the office system

operated by the pursuer was, on the evidence, relatively simple and straightforward. In

essence, Ms Spink received and opened the mail and if she happened to be on holiday or off

then a colleague would receive the mail, open it, and place it into two folders on Ms Spink’s

desk, to await her return. Ms Spink would then identify the appropriate person to receive

the mail and, in respect of a letter such as this, either place it on Mr Mann’s desk or pass it to

Mr Stirling. Mr Mann would have passed it to Mr Shellard. If it had been passed by

Ms Spink to Mr Bruce, he too would have passed it to Mr Shellard. None of the relevant

personnel saw the document. Had it been received, it would have been retained. The

archived material included any important items from 2012. But the searches, which were

thorough and comprehensive, did not locate the letter. Moreover, the evidence was also

clear that the specific request made in the letter, for the email address of the pursuer’s

accounts department to be sent, would have been responded to, but again a thorough check

of sent emails indicated that this had not occurred and there was no evidence from the

defender’s witnesses that any such response had been made. On the evidence, at the

material time (July 2012) only a relatively small number of items of mail (about ten) were

received each day at the farm office. There were also instances of items sent to the same

address, broadly around the time when the letter was sent, which had not been received, in

particular the six invoices. In that regard, I accept the evidence of Ms Spink that the invoices

had not been received and I reject the alternative suggestion that they had already been

received, but that copies were requested for some reason relating to payment.

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[46] There were also many examples of items sent to the same address as that on the letter

dated 30 July 2012 which were received. In my view, the incorrect address was of very little

consequence. The slightly wrong version of the farm name and the local village name were

of no moment, given that there was no other farm in the area with a similar name and no

other relevant village name which might result in confusion, and that the correct postcode

was used. The pursuer never raised any issue about the use of this address. There was

some evidence of items of mail being delivered to the wrong address within the farm area,

but the evidence was also that an item that was delivered to, say, a cottage, would be taken

to the farm office by the recipient. I accept that the defender’s name appeared on the

envelope but while non-delivery by the postman might have resulted in the envelope being

returned to the defender, which did not happen, mis-delivery or some other problem would

not, or at least not necessarily, have that result. Lastly, I see no force in the submission for

the defender that in making and accepting the order Mr Shellard and Mr Notley did not

attempt to reach any express agreement about matters such as the precise date of delivery,

payment terms, warranties or retention of title, implying that further terms and conditions

were needed. Their agreement sufficed as contract.

[47] Taking the whole circumstances and submissions into account, I therefore conclude

that the pursuer has discharged the onus of proof and rebutted the presumption that the

letter was received.

If the letter was sent and received, has the jurisdiction of this court been excluded?

[48] In view of my decision that the letter was not received, this issue does not arise for

consideration. However, having received submissions on the point, it is appropriate that I

briefly express what my conclusions would have been in the scenario of it having been

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received. The letter dated 30 July 2012 stated that the defender was introducing “new terms

and conditions of sale that will cover the transactions between our two organisation.”

Numerous invoices were sent by the defender to the pursuer both before and after this date,

and on the evidence they each stated “All business subject to our standard conditions of sale

which include retention of title clause”. The defender’s position (which fits with that of the

pursuer in this regard) was that the contract giving rise to the present action was entered

into by the exchanges between Mr Shellard and Mr Notley in June and July 2016. The

defender’s contention was that terms and conditions were incorporated expressly into all

future contracts for sale with the pursuer as a result of intimation of the Conditions of Sale to

the pursuer with the letter dated 30 July 2012. At no time did the pursuer subsequently

challenge or seek to vary those terms, argued the defender, and thus they were applicable to

future transactions, including the clause concerning jurisdiction.

[49] In terms of section 20(1) of the Civil Jurisdiction and Judgments Act 1982, Schedule 8

of the Act has effect to determine in what circumstances a person may be sued in civil

proceedings in the Court of Session or in a sheriff court. Paragraph 6 of Schedule 8

provides:

“6. (1) If the parties have agreed that a court is to have jurisdiction to settle

any disputes which have arisen or which may arise in connection with a

particular legal relationship, that court shall have jurisdiction.

(2) Such an agreement conferring jurisdiction shall be either—

(a) in writing or evidenced in writing; or

(b) in a form which accords with practices which the parties have

established between themselves …

(3) Any communication by electronic means which provides a durable

record of the agreement shall be equivalent to ‘writing’.”

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In determining any question as to the meaning or effect of these provisions, EU law

concerning the relevant part of the Regulation (now Article 25 of Regulation 1215/2012) must

be applied. There is a substantial body of case law on this issue and I was referred only to a

few of the key decisions, principally Bols Distilleries BV v Superior Yacht Services Ltd and 7E

Communications Ltd v Vertex Antennentechnik GmbH. In considering the relevant principles, I

have also had regard to the helpful observations of Waksman J in R + V Versicherung v

Robertson [2016] EWHC 1243 (paras {7] and [8]) and Christopher Hancock QC sitting as a

judge in Pan Ocean v China-Base Group [2019] EWHC 982 (para [32]), and to the cases to

which they refer. As the legislation makes clear, an agreement conferring jurisdiction must

be contained or evidenced in writing. The agreement, or consensus, in relation to exclusive

jurisdiction must be “clearly and precisely” demonstrated. Whether such an agreement

exists is a matter to be decided objectively, in accordance with the usual principles. The

requirement of writing is not satisfied by the fact that the clause itself is in writing; the

consent must be in writing or evidenced (or confirmed) in writing. The purpose of this

formality is to establish consent to the necessary degree of certainty. If there is no written

agreement, then the evidence of consent must be at least by written confirmation. There is

no authority supporting the proposition that for this purpose consent can be implied solely

from the conduct of the parties. Where a contract signed by both parties expressly refers to

general conditions which include a clause conferring jurisdiction, the test is satisfied. An

express reference to the general conditions in the contract is enough and there is no

requirement for any express reference to the jurisdiction clause itself.

[50] Applying the relevant principles to the present case, it is quite clear that the

exchanges between the parties in relation to this particular order (which each party refers to

as the contract) made no express reference to the terms and conditions. In some cases, the

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question which may arise is whether there was an overarching contractual agreement,

within the terms of which certain orders were placed, which satisfies the test in the

authorities. However, that was never put forward as the situation here. The defender’s

position is that having been sent the terms and conditions, and not demurred therefrom, the

pursuer was bound by them in any later contract. While the defender no longer insisted

upon an argument that there was incorporation of the terms and conditions by the course of

dealing, the repeated reference in the invoices, when taken along with the letter dated

30 July 2012, was said to reinforce incorporation by that letter. As I understood the

defender’s position, it was that consent to the terms and conditions should be taken to arise

from the making of a future order, by means of telephone calls and emails in June and

July 2016. This, however, does not meet the test of agreement or consensus in relation to

exclusive jurisdiction being clearly and precisely demonstrated and being agreed in writing

or evidenced in writing. If, for example (on the hypothesis that the letter had been received)

there had been express reference in the email correspondence, when entering into the

contract, to the terms and conditions, that is likely to have sufficed, but there was no such

reference. Accordingly, I conclude that even if the letter dated 30 July 2012 had been

received, the jurisdiction of this court would not have been excluded.

Conclusion

[51] For the reasons given, I am persuaded that the letter dated 30 July 2012 was sent by

the defender, but on the evidence the consequent presumption that it was received by the

pursuer is rebutted. On that basis, the defender’s case fails. Even if the letter had been

received, the test for incorporation of the exclusive jurisdiction clause is not met.

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Disposal

[52] As a result, I shall therefore repel the first and third pleas-in-law for the defender. I

shall sustain the pursuer’s third plea in law, and exclude the following averments from

probation: (i) in Answer 1, the last two sentences; and (ii) in Answer 6, the fifth and sixth

sentences, and the passage from and including “The invoice stated on the front …” to the

end of Answer 6. I shall put the case out by-order to determine further procedure, reserving

in the meantime all questions of expenses.