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Cite as: 2021 GWD 14-209, 2021 SCLR 328, [2021] ScotCS CSIH_23, [2021] CSIH 23

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FIRST DIVISION, INNER HOUSE, COURT OF SESSION

[2021] CSIH 23

A226/17

Lord President

Lord Malcolm

Lord Doherty

OPINION OF THE COURT

delivered by LORD CARLOWAY, the LORD PRESIDENT

in the reclaiming motion

in the cause

PEEBLES MEDIA GROUP LIMITED

Pursuers and Reclaimers

against

PATRICIA REILLY

Defender and Respondent

______________

Pursuers and Reclaimers: Lindsay QC; Clyde & Co (Scotland) LLP

Defender and Respondent: Smith QC; Lefevre Litigation

12 March 2021

Introduction

[1]

The pursuers, who are a publishing company, pursue their former credit controller

for damages arising out of a "whaling fraud". In short, the defender made four payments

totalling some £193,250 to persons, who had no connection with the pursuers, in the

mistaken belief that the payments had been authorised by her managing director, namely

Yvonne Bremner, by a series of emails. The pursuers' claim on record is based upon a

breach by the defender of the implied term in her contract of employment to exercise

reasonable care and to display the skill commensurate with her position. More specifically,

the defender was said to have been at fault in failing to realise that emails, purporting to be

from Ms Bremner, were suspicious. She ought to have taken steps to check their

authenticity. The case is not based on the defender doing something which she was

contractually prohibited from doing. There is no suggestion that the defender was complicit

in the fraud.

[2]

The central issue in the reclaiming motion is whether the Lord Ordinary erred in

finding that the defender was not negligent. The case is unusual because it is rare for an

employer to sue a relatively junior employee for negligent actings. That there is a duty to act

with care, when dealing with an employer's funds, is undoubted (Clydesdale Bank v Beatson

(1882) 10 R 88). However, few employees insure themselves in respect of their own

negligence. Employers are generally able to obtain insurance to cover losses sustained in

that manner. If employers were to pursue their employees for negligent actings on a regular

basis, this could have a significant impact on the employment relationship. That, however,

is strictly irrelevant to the current claim.

The Lord Ordinary's Reasoning

General

[3]

Although the Lord Ordinary made no findings on the matter, it is admitted on record

that the pursuers are the publishers of magazines aimed at the business (eg Scottish Grocer)

and consumer (eg Homes & Interiors Scotland) markets. They employed around 50 staff.

Again, although not dealt with in the opinion, the averments that the defender had been

employed by the pursuers, or companies which they had absorbed, since 1996, first as an

accounts assistant, then as a credit controller, are admitted.

[4]

The Lord Ordinary found that the defender's main duty was to "chase" trade debts.

She would do this by phoning customers, checking customer details, providing support

when court action was instructed, and liaising with Ms Bremner. Her line manager was

Claire Caldow. Ms Caldow prepared sales invoices, reconciled the sales ledger, made

payments on the bank account, processed purchase invoices, reconciled the purchase ledger,

reconciled the bank accounts and processed the petty cash. Ms Bremner was closely

involved in those processes. She liaised with the defender on a daily basis "in that

connection". Responsibility for clearing an invoice for payment lay with her. According to

Ms Bremner, the defender did not have "the right" to make payments. Only Ms Bremner,

Ms Caldow and the company secretary and finance director, namely Rosemary Morris, who

worked part-time, were authorised to make payments. At some point, Ms Bremner

extended the defender's duties "so as to provide support for" Ms Caldow, but this did not

involve her in making payments to creditors.

The First Payment

[5]

Ms Bremner was to start a week's holiday on the evening of Thursday, 8 October

2015, prior to going to Tenerife on the following day. Ms Caldow was also to go on holiday

on the Friday. The defender would be the only full time employee in the accounts

department from the following Monday. All three met to discuss arrangements during

Ms Bremner's absence, including work which the defender was to do. There was no

indication that the pursuers would require to make a series of payments to other businesses,

other than to G4S. Ms Bremner told the defender to ask G4S to send an invoice.

[6]

Late in the morning of Friday, 9 October, an email purporting to come from

Ms Bremner's iPhone ("Yvonne Bremner [mailto:yvonne.bremner@... etc]"), but in fact

emanating from "ceoreplys@writeme.com", was sent to the defender's email address

(trisha.reilly@... etc). This asked whether the defender was in the office. She replied that she

was. The response to that was "Ok Trisha, I need you to process a Chaps payment swiftly.

what [sic] details will be needed? Thanks Yvonne Bremner". The defender set out the

information that would be required to make the payment (name, bank account, sort code,

amount) and continued: "Claire is saying we need your password as she doesn't think her's

worked the last time". The recipient replied:

"Ok Trisha, I think claire [sic] password has been sorted, or has all password [sic]

been reset again? process [sic] a chaps payment in the amount of 24,800 GBP to...

Power Counsulting LTD"

A Barclay's Bank account number was provided. The email ended "Thanks Yvonne

Bremner Sent from my iPhone".

[7]

The defender could not find the name of the company on the pursuers' system. The

name had obviously been mis-spelt. She checked with the register at Companies House.

She attempted to phone Ms Bremner to explain that the payment was not going smoothly.

She sent an email back querying the precise name of the payee, as there were several

similarly named companies and an address was required. An address was provided. The

defender contacted Ms Caldow, who was authorised to operate the pursuers' online bank

account and was familiar with the regular payees. Power Consulting was not a name with

which Ms Caldow was familiar. That did not deter her from making the payment. A

discussion followed, during which the defender surmised that the money might be to pay

for Ms Bremner's roof repairs.

[8]

Ms Caldow's testimony took the form of an affidavit. She deponed that she

processed the payment as fast as possible because she was going on holiday. The defender

said that Ms Caldow "clicked through" the bank's fraud warning notice. Since Ms Caldow's

affidavit was silent on the point, the Lord Ordinary accepted that this is what happened.

The payment went through.

[9]

At the time of the defender's phone call, Ms Bremner was on her flight. She did not

pick up that she had a missed call and that a voicemail had been left until the evening. The

Lord Ordinary found that, in the voicemail, the defender had told Ms Bremner that she was

"making" or "processing" a payment. The voicemail did not mention an email from

Ms Bremner. Ms Bremner had not been concerned by the voicemail as it was one of the

defender's responsibilities to help Ms Caldow, who was authorised to make payments.

[10]

The Lord Ordinary held that the defender was not responsible for this payment as it

had been made by Ms Caldow. Ms Caldow had originally been a co-defender, but the case

against her had been abandoned. The Lord Ordinary took into account the fact that

Ms Caldow had not noticed anything suspicious when assessing the defender's

"culpability". He had not heard evidence on the defender's familiarity with Ms Bremner's

vocabulary or writing habits which would have made her suspicious of the use of certain

words, mis-spellings or the signing off of emails using her full name. He did not consider

that the defender's suspicions should have been aroused because the emails had come from

an iPhone, whereas Ms Bremner was a technophobe whom the defender only knew to carry

a mobile. Submissions from the pursuers in relation to the existence of two different email

chains and odd times on some of the incoming mails, which might have suggested an origin

in the Americas, did not persuade the Lord Ordinary that the defender ought to have

realised that something was amiss.

The Second Payment

[11]

On the following Monday, 12 October, another email purporting to come from

Ms Bremner was sent to the defender. It confirmed that the Friday payment had been

received and asked the defender to "process another payment of $75,200 to the same

recipient and classify it as payment balance". The defender queried the dollar amount

which was promptly converted into "GBP" with "Sorry for the Typo" added. The defender

set about processing the payment by using the details which Ms Caldow had provided. She

could not process this as "Power Consulting" was not on the payee list. She emailed the

person whom she thought was Ms Bremner and asked for help on how to complete the

payment.

[12]

The defender texted Ms Caldow, telling her that Ms Bremner had asked her to

process another payment and asking for confirmation that a particular PIN was the correct

one for use with what was presumably a card reader. Ms Caldow confirmed that the PIN

was correct. The Lord Ordinary concluded, not surprisingly, that Ms Caldow was thereby

aware that the defender had the appropriate details with which to process online banking

payments. The defender had seen how Ms Caldow processed the payments but, despite the

averment to the contrary in her pleadings, she eventually accepted during her testimony

that Ms Caldow had not taught her how to do this. She had seen and been able to recall how

Ms Caldow had made the first payment.

[13]

Prior to being able to authorise payment, the defender would have been faced with

the bank's fraud warning notice. One of the warnings referred to precisely the type of fraud

which was being perpetrated on the pursuers. It explained that those involved in payments

would receive an email "seemingly from the genuine email address of another member of

the business (often a Director) with a payment instruction". Customers were advised "to

take additional steps to verify payments when dealing with email based instructions

(particularly where the beneficiary is not one that you have paid before)". The defender

"clicked through" the fraud warnings without reading them, just as she had seen

Ms Caldow do.

[14]

When she could not enter the payee details successfully, the defender phoned

Alistair MacKay at the bank for assistance. He explained that he could not help her as he

was not sufficiently knowledgeable about online banking. The bank helpdesk could assist

with this type of query, but would not do so here as the defender was not authorised to

make payments. Mr MacKay explained to the defender that she was not authorised but, as

the Lord Ordinary found, he did not tell the defender that she should not make any further

attempts to make payment. In his testimony, Mr MacKay acknowledged that he had a

discretion to allow unauthorised payments to proceed. He knew that the defender was

alone in the office; with Ms Bremner and Ms Caldow both on holiday. This explained why

he did not stop the defender from using the system.

[15]

The defender received a response to the question in her email, to the person whom

she believed was Ms Bremner, on whether there was another method of payment. This

asked whether she (the supposed Ms Bremner) required to confirm the account details

again. The Lord Ordinary interpreted this as meaning that the defender was to continue to

try to make payment. He added:

"I consider that the defender was entitled to read this as an instruction from Yvonne

Bremner to keep trying to make payment even though Mr MacKay had told her she

was not authorised to make the payment".

The defender said that she would keep trying. Eventually, the defender emailed as follows:

"Eureka, sorted. Only took about 2 hours but hey, printed off acknowledgement

ready for a Gin & Tonic lol."

[16]

The Lord Ordinary concluded that he "was unable to say that [the defender] was in

breach of her implied obligation to exercise reasonable skill and care". The defender "was

entitled to take her lead to some extent from her superior", by whom he meant Ms Caldow.

He was not "persuaded" that reading the bank's notice would have altered the outcome.

The defender was alone in the office. Ms Bremner had not replied to her voicemail and

Ms Caldow had ignored the warning at the time of the previous payment. The Lord

Ordinary explained that, looking at matters from the defender's point of view, "she was

entitled to conclude that Yvonne Bremner wished her to make the payment". He did not

think that the defender should have been alerted by the use of the dollar sign on the email

because, he reasoned, this could have been a "typo", as the emailer had said it was, because

the dollar and pound keys are next to one another on a standard keyboard. He makes no

observation that this is not the position on an iPhone keyboard.

The Third and Fourth Payments

[17]

No doubt buoyed by his or her success so far, on the Tuesday (13 October, 2015)

another email was sent from an iPhone, bearing to be from Ms Bremner, advising of the

need to make two more "chaps payments". After sundry exchanges, the payees' account

details were provided. The sum of £56,750 was paid to Hitendra Limited of Wembley,

London and £36,500 to Arshad maintenance services [sic] of Walsall. This required the

defender to find the correct sort code for the latter. There were sufficient funds in the

pursuers' current account to make one or other of the payments, but not to make both. In

order to pay both amounts, the defender transferred funds from the pursuers' invoice

financing account, to which the defender did have access, to the current account. Although

the defender said that Ms Caldow had authorised her to do this, the Lord Ordinary did not

believe her. The bank's "Fraud Area" considered the Tuesday payments to be suspicious. It

contacted the defender to query them. The defender confirmed that the pursuers did wish to

make payments to the payees. As a result, Mr MacKay authorised the release of the funds.

[18]

The fraud was discovered when Ms Morris was in the office on the Thursday

(15 October, 2015). She contacted the bank, which was able to retrieve £85,265.98. These

were sums of approximately: £15,000 from Arshad maintenance services; £4,700 from

Hitendra; and £50,000 and £16,000 from Power Consulting. The defender was dismissed on

11 November 2015.

[19]

The Lord Ordinary concluded that the language of the emails on the Tu esday was

not any more suspicious than those on the Friday or the Monday. The defender was not in

breach by not becoming suspicious. Although no case of this nature was made on record or

in the submissions at the end of the proof, the Lord Ordinary held that the defender had

breached her duty to act with reasonable skill and care in transferring the funds between the

pursuers' accounts. He nevertheless held that the losses sustained as a result of this breach

did not arise "naturally, ie according to the usual course of things" (Hadley v Baxendale (1854)

9 Ex 341).

Submissions

Pursuers

[20]

The Lord Ordinary identified the relevant duties but erred in law in concluding that,

on the facts found, the defender had not breached those duties in respect of the Friday and

Monday payments. The problem was not with the individual findings in fact, but that,

when considered cumulatively, the only reasonable conclusion was that the defender had

been in breach. The conclusion that the language of the emails on the Tuesday did not

contain any more clues as to their origin than those that had gone before was wrong in the

same respect. The emails were obviously fraudulent. The Lord Ordinary failed to consider

"in the round" the following factors: the pursuers had no business relationship with any of

the payees; their names did not suggest any legitimate relationship; it was inherently

improbable that Ms Bremner would instruct an employee who was not authorised to make

payments of significant sums, all while she was on holiday. These additional suspicious

circumstances meant that the only reasonable conclusion was that there was also a breach

relative to the Tuesday payments. There were repeated flags which would have alerted a

person of ordinary intelligence and everyday experience. Reassessing the factors

objectively, a credit controller, who exercised reasonable skill and care, would have been

alerted.

[21]

The Lord Ordinary was correct to hold that the defender was in breach in making the

internal transfer. The loss here was not too remote (Hadley v Baxendale; Jackson v Royal Bank

of Scotland [2005] 1 WLR 377; Transfield Shipping v Mercator Shipping (The Achilleas) [2009] 1

AC 61). The Lord Ordinary failed to consider what was within the reasonable

contemplation of the parties at the time of the contract. The context for assessing remoteness

was the employment relationship. The relevant contractual terms were that she was not

authorised to make payments on behalf of the pursuers and/or to effect the internal transfer

of funds. Losses are recoverable if they would generally happen in the ordinary course of

things if the obligation not to transfer money from one account to another was breached

(Balfour Beatty Construction (Scotland) v Scottish Power 1992 SLT 811 at 813, 1994 SC (HL) 20 at

31; Cosar v UPS 1999 SLT 259). The loss was "a real danger", "a serious possibility" and "not

very unusual and easily foreseeable" (Cosar at 264, quoting from Czarnikow v Koufos [1969] 1

AC 350).

[22]

The Lord Ordinary erred on causation. He failed to apply his mind to the content of

the defender's duty, having held that she was obliged to email Ms Bremner for authority for

the internal transfer. He failed to consider whether the duty required the defender to

compose a fresh email using the correct email address for Ms Bremner. The failure to use

the correct email address for Ms Bremner caused the pursuers' loss. Applying common

sense, it was the dominant or effective cause (Galoo v Bright Grahame Murray [1994] 1 WLR

1360). It did not merely give the opportunity for the loss to be sustained.

Defender

[23]

The Lord Ordinary was entitled to reach the conclusions that he did on the Friday

and Monday payments. The pursuers' criticism of a purported failure to look at the

individual indicators of fraud in the round fell into the first (credibility, reliability and the

primary facts) and second (inference of fact drawn from primary facts) categories which

were identified in W v Greater Glasgow Health Board [2017] CSIH 58, at para [49] (see also

Anderson v Imrie 2018 SC 328, at para [35]). The argument, that the Lord Ordinary erred in

failing to hold that the defender breached her contract, fell into the third category

(application of the law to the facts; ie issues of mixed fact and law). In respect of the first

and second category failures, the pursuers had not produced a transcription of the evidence.

There was no direct challenge to any findings of primary fact. The alleged failure to

consider all the evidence in the round did not acknowledge the Lord Ordinary's rejection of

certain evidence and his findings that there was no evidence for some of the pursuers'

factual propositions. These were first category criticisms (see McGraddie v McGraddie 2014

SC (UKSC) 12, at para [3], citing Anderson v City of Bessemer 470 US 564 (1985) at 574-575).

Without a transcript, the court could not review these findings.

[24]

The Lord Ordinary's evaluation of the facts fell into the second category. It could

only be interfered with if he applied the wrong principle, or failed to take a relevant matter

into account, or took into account an irrelevant matter or was wrong (Datec Electronics

Holdings v UPS [2007] 1 WLR 1325, at para [46]; NRAM v Steel 2018 SC (UKSC) 141, at

para [37]). None of these were argued.

[25]

The third category argument did not address hindsight or the context in which the

defender received and responded to the fraudulent emails. The reliance on the unfamiliarity

of the payee name ignored the fact that Ms Caldow ordinarily made payments. There was

no evidence that the defender should have recognised Power Consulting as an unfamiliar

entity. Ms Caldow did not interpret the transaction as suspicious. The errors and oddities

in grammar and vocabulary were not unusual. The pursuers led no evidence demonstrating

that Ms Bremner had a fixed method of signing emails. The contentions that Ms Bremner

was a "known technophobe", or not a habitual user of a mobile phone, were disputed. She

had a phone on holiday and received the voicemail. In respect of ignoring the warning, the

defender had taken her superior's lead; this was tacit permission to do so. Had she not done

so, there would have been no difference. Mr MacKay did not tell the defender not to make

further attempts at payment. He was willing to allow the transaction to proceed. The use of

a dollar sign was reasonably categorised as a typographical error. The reclaiming motion

rested heavily on hindsight, whereas the Lord Ordinary avoided this error.

[26]

The Lord Ordinary applied the correct legal test for remoteness, under reference to

Hadley v Baxendale (supra). In submissions, neither party addressed whether the loss was

reasonably in the contemplation of the parties when their contract was formed. The Lord

Ordinary correctly concluded that the fraud was "exceptional and unnatural". There was no

evidence of the prevalence of "whaling", or any of the measures which the pursuers had in

place to avoid the risk therefrom or any instructions given by the pursuers to the defender

on how to recognise such a fraud. There was no evidence that a transfer of funds between

accounts could result in loss and that this would have been in the contemplation of the

parties when they entered into the contract (H Parsons (Livestock) v Uttley Ingham & Co

[1978] QB 791, at 807). The Lord Ordinary held that, had the defender emailed to ask if she should

transfer funds to the current account, the fraudster would have confirmed that she should

do that. The pursuers led no evidence on why a fresh email was required.

Decision

[27]

In Woodhouse v Lochs and Glens Transport 2020 SLT 1203 the court (LP (Carloway) at

para [31]), having reviewed the authorities, set out the scope of a reclaiming motion against

a Lord Ordinary's finding on an employee's negligence. Although the duty in Woodhouse

was quasi delictual and the damage was physical, the same considerations apply when the

negligence averred is in the context of a contract and the losses are economic.

[28]

The decision at first instance on whether or not negligence has been established was

one of law. It was nevertheless heavily dependent upon primary and secondary findings of

fact. In reviewing these findings, the court has to exercise appropriate caution. Where what

is being reviewed is the application of the law to the facts, the court can more easily reverse

a first instance decision. In doing so, "an appellate court may be more objective in its

approach and be less influenced by the Lord Ordinary's perception of, and maybe even

sympathy for, the witness" (Woodhouse, at para [33]).

[29]

The payment, by a commercial organisation, of large sums to persons who had no

known dealings with it and without a supporting invoice might be regarded as

extraordinary. However, one of the Lord Ordinary's critical findings, which the pursuers do

not challenge, is that the defender genuinely thought that she was being instructed to make

the payments by her managing director.

[30]

The primary challenge by the pursuers was that the Lord Ordinary failed to assess

the evidence as a whole. It was not said that he had failed to consider relevant evidence or

that he had misunderstood it. There is no sound basis for holding that he did not assess the

evidence as a whole. As with many written judgments, the decision maker will set out

different parts of the evidence, and the relative findings in fact, in a linear fashion. He or she

may make comments which are specific to those elements. That does not carry with it any

assumption that the judge has failed to consider the whole evidence or that his reasoning

was based upon a consideration of only parts of the evidence. The Lord Ordinary did

consider all of the relevant evidence in reaching his conclusions on each of the payments.

[31]

One problem which this court faces is an absence of findings, or information, in areas

in which it might have expected there to be greater detail. This may have been because of a

lack of evidence. Where these areas exist, and there is no admitted position upon record, the

court is not able to remedy any lack of information. It cannot, without a transcription of the

evidence, review the Lord Ordinary's findings of primary fact. It was not asked to do so.

Ultimately this was a critical feature in the determination of the reclaiming motion.

[32]

One area where there is a dearth of information in the Lord Ordinary's opinion is the

nature and scope of the pursuers' business and the defender's position within it. These

factors are important in an assessment of whether the defender has performed her duties in

a manner, as the pursuers put it on record, commensurate with her position. Her level of

functioning within the pursuers' organisation is a crucial factor. Although the general

nature of the pursuers' business and the defender's place within it appear on record, there is

little insight into the degree to which the defender was aware of the pursuers' business and

thus the extent to which she may have been alerted by the names and addresses of the

payees or the apparent oddities in the emails.

[33]

What the court is left with are the findings by the Lord Ordinary that the defender's

"main duty" was to "chase" trade debts. The only other duty mentioned was to support

Ms Caldow. Although not spelled out by the Lord Ordinary, the significance of this must be

that the defender was neither trained nor experienced in the payment of creditors. It may

seem obvious to many that regular payments made by commercial concerns should not

occur without the existence of a covering invoice, but the Lord Ordinary did not find that

the defender was aware of this. Perhaps she was not asked. Although Ms Bremner said that

the defender did not have "the right" to make payments, this appears to have meant that she

was not authorised to intromit with the online banking. Unfortunately for the pursuers, that

contention was contradicted by the actings of Ms Caldow and Mr MacKay. Ms Caldow was

aware that the defender was using the current account and confirmed to the defender the

PIN number for use in making payments. Mr MacKay did not tell the defender not to use

the account, even though he knew that she was not one of the persons whom the pursuers

and the bank had agreed were authorised to use it. Ultimately he was content to allow the

defender to process significant sums of money.

[34]

In relation to the Friday payment, and this must have influenced his thinking on the

payment of the later sums, the Lord Ordinary found, and again it was not disputed, that

Ms Caldow had not noticed anything suspicious in relation to the request in an email from

an iPhone, bearing to be from "Yvonne Bremner", to pay a significant sum to an unfamiliar

entity without an invoice. Ms Caldow was the defender's line manager and the person

(apart from Ms Bremner) responsible for paying creditors. Making payments to creditors

was one of her normal tasks, but she had not noticed anything odd about the situation. It

would be difficult for the pursuers to demonstrate that a more junior employee, who was

not engaged to do this type of work, ought to have done so.

[35]

The Lord Ordinary states that he had not heard evidence on the defender's

familiarity with Ms Bremner's vocabulary or writing habits. He made no finding on

whether Ms Bremner had an iPhone but it may be inferred from the references to her being a

technophobe that she did not. He does not say whether the defender knew this.

Nevertheless, critically, the Lord Ordinary did not consider that the defender should have

noticed that: the emails had come from an iPhone; there were two different email chains and

their timings were odd. In order to sustain a challenge to such findings, the court would

require to look at the evidence, and in particular to the testimony of the defender,

particularly under cross examination. Without a transcript, it cannot do this.

[36]

Similar considerations apply to the second payment. The Lord Ordinary makes

reference, on at least two occasions, to the defender being "entitled" to read the emails as

being instructions from Ms Bremner to pay the amounts sought notwithstanding that she

was not authorised to operate the bank account. This may be an odd use of language, if all

that is meant is that it was reasonable for the defender to believe that this was what she took

from the emails. The problem with the pursuers' position on this payment is that the

defender was not only given authority by Ms Caldow to use the PIN, she contacted the

pursuers' bank. This allowed her, as an unauthorised person, to process the payments

without further inquiry. In ignoring the bank's warning notice on the Monday, the defender

was doing the same thing as her line manager, Ms Caldow, had done on the Friday.

[37]

There were certainly features which may have caused a person in the defender's

position, and who used greater skill and care, to be wary, but the Lord Ordinary had

material before him from which he could hold, as a matter of fact, that the defender did not

jalouse what was truly going on and could not reasonably have been expected to do so. The

same applies to the third and fourth payments, which the bank had initially regarded as

suspicious, but had allowed to be processed. Since the bank were undoubtedly aware of the

potential for a scam, and the defender was not, it was difficult to fault the defender in

circumstances in which the bank had authorised the transfer of the funds.

[38]

Leaving aside the specific ground of challenge in relation to failing to look at the

evidence as a whole, which the court has rejected, and asking the broader question of

whether the Lord Ordinary's decision on the ground of action can reasonably be explained

or justified, the answer must be in the affirmative. That is so even if another Lord Ordinary

might have drawn different inferences from the primary facts and might then have applied

the law in a manner which resulted in a different conclusion on whether negligence had

been established.

[39]

Although there were relatively elaborate submissions on remoteness of damage and

causation in relation to the internal transfer of funds, the remaining aspects of the reclaiming

motion can be shortly dealt with. First, there was a no case on record that the defender was

in breach of her duty by transferring monies from one of the pursuers' account s to another.

Not only that, there were no submissions from either side on that point. In these

circumstances, there was no basis for the Lord Ordinary to make any finding of breach of

duty based upon this ground.

[40]

Secondly, the transfer of monies from one of the pursuers' bank accounts to another,

did not cause them any loss. It was the transfer to the payees which did so. For the reasons

already given, the pursuers' case against the defender on that aspect failed on the facts.

[41]

The court accordingly refused the reclaiming motion and adhered to the

Lord Ordinary's interlocutor of 15 November 2019.