Scottish Sheriff Court Decisions

YUK WONG CHAN v. MAN FAI TO [1999] ScotSC 15 (18th May, 1999)

The Sheriff Principal having resumed consideration of the appeal Sustains same and Allows the appeal; Recalls the interlocutor of the Sheriff dated 1 February 1999 complained of; Finds the defender's law agent liable personally to the pursuer in the expenses of the abortive diet of debate set down for 1 February 1999 and in the expenses of the appeal; Allows an account thereof to be given in and Remits same when lodged to the Auditor of Court to tax and to report; Remits the cause to the Sheriff to fix a new diet of debate and to proceed as accords.

NOTE:

In this action the sheriff granted decree by default at a diet of debate on 1 February 1999 which the defender's solicitor principally instructed failed to attend on account of a "misdiarising" error which occurred in his office and resulted in his being in another court (at Paisley) conducting a different case at the time. When the case was called before the sheriff at 11 am approximately an agent (Miss Spilg) appeared on the defender's behalf having just accepted instructions by telephone to do so for limited purposes only. My sources of information as to what then happened in court are (1) the sheriff's interlocutor, (2) the sheriff's note, (3) Mr H Singerman who was then present and (4) a de recenti file entry made by Mr Singerman on his return to his office. From these sources taken together it appears that Miss Spilg declared at the outset that she appeared not for the debate but for the purpose only of presenting apologies and an explanation and moving the court to discharge the diet and continue the case for the fixing of a new diet. There then followed what seems to have been a generalised discussion before and with the sheriff in which two possible courses of action were considered, viz (1) whether the diet should be discharged and (2) whether alternatively there should be a decree by default. Miss Spilg apologised and explained and moved for a discharge and a continuation. Mr Singerman opposed this and moved for decree by default. It seems that Miss Spilg and probably again Mr Singerman were given one or more further opportunities to reply or reiterate their positions. Miss Spilg in addition sought "relief" on the defender's behalf from any default under the dispensing powers of Ordinary Cause Rule 2.1. Thereafter the sheriff announced (according to Mr Singerman) that he would not grant a discharge, that he was not disposed to exercise any dispensing power under rule 2.1 to relieve the defender of the consequences of the default which in his opinion had occurred and that he would grant decree by default in terms of crave 1. One possible course which was not discussed nor considered was to allow or require the debate to proceed: no doubt this was due to Miss Spilg having declared at the start that she did not appear for the debate and was in no state of preparedness to conduct it.

The sheriff's interlocutor makes no reference to Miss Spilg's motion for discharge and continuation and does not deal with that motion. Instead it narrates the presence of two procurators who were heard on a motion under rule 2.1 which was refused and the granting of decree by default "in respect of there being no appearance by the principal agents on behalf of the defender". The sheriff's note likewise contains no record of his disposal of Miss Spilg's motion for discharge and continuation although recording that such a motion was made. The interlocutor is the most important document and indeed constitutes the order now appealed against. It is defective ex facie in a number of respects, viz (1) as already stated no mention is made of the defender's motion for discharge and continuation to a new diet, although from other sources it appears that such a motion must have been made; (2) the interlocutor bears to grant a decree by default for non-appearance in the presence of an agent representing each party; and (3) it records the default as being failure to appear not of any agent or party at all but of a "principal" agent.

The sheriff in his note declares that he considers the appearance at a diet of debate of an agent with a "limited mandate" to amount to non-representation and non-appearance for the purposes of Ordinary Cause Rule 16. He cites two cases (not cited to or discussed before him on 1 February 1999) which he says he finds reinforce this view. These are (i) K-X Rentals Ltd v Joyce 1992 SLT (Sh Ct) 42 and (ii) Nortech v Aeroskip Sports Ltd 1996 SLT (Sh Ct) 94. He records in the same paragraph that there was in the present case "no question of a withdrawal from acting". In so saying he has I think misinterpreted those cases and also the situation which arose in court before him. The cases referred to are in my opinion, when properly read, authority for the proposition that appearance at a diet whether of debate or proof by any qualified solicitor instructed to appear on whatever mandate amounts to representation at the diet until such time (should it ever arrive) as that agent withdraws from acting. If no withdrawal occurs the party continues to be represented; and if withdrawal does occur the court then (and only then) has to consider what are the consequences of the party becoming unrepresented in the course of a peremptory diet. I am inclined to think that Sheriff Principal Nicholson has correctly analysed the position in the two cases referred to and on that analysis the occurrence or absence of a withdrawal is crucial to the question whether the party is or is not represented at the diet.

In the present case the logical progression of events should have been to consider first the motion made for the defender to have the diet discharged and the case continued to a new diet; if granted that would have been an end of the hearing but if refused consideration would then have turned to the debate itself and at that point Miss Spilg might or might not have sought to withdraw. Had she not done so the debate would have proceeded to a decision on its merits but had she sought and been permitted to do so the question would then have arisen of whether or not the pursuer should be granted decree by default. At that point the sheriff would have applied his mind to the exercise of the discretion in such a matter conferred on him by rule 16 and would have taken account of the relevant considerations on either side. That he did not do so or took account of irrelevant considerations (see below) is apparent from his own note and the account given to me of what occurred at the diet on 1 February 1999. The speciality of the situation here of course was that Miss Spilg had announced ab initio that she was not appearing for the debate and the sheriff was thus faced (contrary to what he says in his note) with a withdrawal in advance, ie with a potentially imminent withdrawal which might materialise at some moment in the progress of the hearing. In these circumstances it is perhaps understandable that the sheriff should have conflated the several steps in the procedure which a logical approach would have dictated into a single practical discussion of whether there should be a discharge with a new diet fixed or a decree by default. In so doing however I suspect that he allowed some confusion of thought to arise and so failed, when deciding the most important matter, to consider all the factors relevant (and only the factors relevant) to the exercise of the discretion enjoined by rule 16.2(2).

From the sheriff's note it appears that he has undertaken research into a number of decided cases which were not canvassed at the hearing before him (when I understand no reference was made to any such decisions). Apart from the two already mentioned above concerning the effect of withdrawal from acting in the course of a peremptory diet these decisions are all save one concerned with the application of rule 2.1(1) to a failure arising at an options hearing and all save that one concern specifically a failure to lodge a record not less than two days beforehand (the exception being one case of failure to appear or be represented at an options hearing). These cases I list below in an appendix for ease of reference. It is noteworthy that in the single case in the list which is not concerned with failure timeously to lodge a record but with failure to appear or be represented (namely Colonial Mutual Group (UK Holdings) Ltd v Johnston 1995 SCLR 1165) there is no reference in the report to rule 2.1(1). From these cases the sheriff deduces that a strong line had been taken by the courts in not readily tolerating such lapses at options hearings and ought to continue to be taken in connection with most lapses at options hearings and at other diets too, the point of the new Ordinary Cause Rules being he says to expedite proceedings and avoid unjustifiable delays. I have to say that I regard these cases as not relevant to the present situation, just as I regard rule 2.1 as not relevant in the present circumstances, the reason for this being that rule 2.1 is stated in terms to be concerned with relief from "the consequences of failure to comply with a provision in these rules". There is in the rules a provision requiring the lodging of a record not later than two days before an options hearing (OCR 9.11(2)) but there is in them no provision so far as I am aware requiring a party to appear or be represented at a diet of debate (or proof for that matter): such a requirement is something known to every court lawyer since he or she was an apprentice or trainee and there has been no need therefore to make it the subject of an express provision in the rules. Such a failure to appear or be represented at a diet of debate is no doubt a default (and indeed is expressly declared to be such for the purposes of rule 16.2) but it is not a failure to comply with a provision in the rules. The rules do not purport to be exhaustive in their content of all the requirements of procedure or practice incumbent on a party and rule 2.1 is applicable only to those which are made requirements by the rules themselves. There are many defaults which can arise without constituting an actual breach of an actual rule and the present is one such. The correct attitude which the sheriff should have adopted to Miss Spilg's invocation before him of rule 2.1(1) would have been to declare her reliance on it inapposite to the circumstances and to disregard it. Had he done so the sheriff would not have become embroiled in a consideration of the numerous cases concerned with rule 2.1 referred to by him in his note and he would not have been misled thereby into thinking that a strong line apparently enunciated by the courts therein of not brooking undue delay required him to grant decree by default in the circumstances of the present case or at least was supportive of his decision so to do. The decisions examined by the sheriff in his note undoubtedly indicate that relief will not readily be granted from the consequences of a failure to lodge a record timeously in advance of an options hearing (in breach of rule 9.11(2)) and that the underlying reason for this is that the new Ordinary Cause Rules introduced at the start of 1994 were intended inter alia to expedite procedure and sweep away the climate of endemic delay which had beset civil procedure. It was however endemic run-of-the-mill delay born of inertia which the

I say above "from the terms of his note at least" because, as narrated, I was informed that no decided cases were cited to the sheriff at the hearing on 1 February 1999 or discussed thereat and I am conscious therefore of the possibility that he may not have had the full terms of all those decisions at the forefront of his mind when actually deciding the matter on that day and may possibly not have based his decision on them at the time. On the other hand he may have carried them in his mind throughout and viewed the points made in them as "of general validity", as his note would appear to indicate. Nevertheless and however that may be, I am satisfied that the sheriff in any event left out of account a relevant and material consideration, namely whether or not the granting of decree by default might result in the defender being deprived of the opportunity to have a stateable defence properly tested to a judicial determination in court. That has long been viewed by the courts as a material matter requiring to be weighed in the exercise of such a discretion, even if other circumstances may on occasion outweigh the court's general reluctance to allow a stateable defence to go untested (see Sheriff I D Macphail's Sheriff Court Practice (2nd Edition) at paragraph 14.12). Yet I find no reference to this material factor in the sheriff's note (with a possible single exception mentioned below), nor does Mr Singerman's de recenti file entry (produced as number 5.2.1 of process) make any mention of its having been considered at the hearing. At the hearing of the appeal it was not suggested to me that this matter had been discussed on 1 February 1999 and in connection with its omission I was referred to the cases of McKelvie v Scottish Steel Scaffolding Co Ltd 1938 SC 278 and Differ v GKN Kwikform Ltd 1990 SLT (Sh Ct) 49. The only passage in the sheriff's note which might be construed as referring to the matter is a single sentence at page 4 where he says "I had considered the whole process before me and its procedural history" but I hardly consider that to amount to a consideration of this factor and a weighing up of its significance or lack thereof. From all the information available to me I am driven to the conclusion that the sheriff failed to take proper account of this relevant and material consideration in his deliberations.

It thus appears to me that the sheriff most probably took account of an irrelevant consideration (rule 2.1 and the cases decided thereon concerning failure to lodge a record in advance of an options hearing) and certainly that he effectively left out of account a relevant consideration (the nature and extent of the defence stated). In these circumstances his exercise of the discretion conferred on him by rule 16.2 must in my opinion be viewed as flawed and in such a situation the matter is opened up for the sheriff principal to assess the position afresh and exercise his own discretion on the issue.

The progress of the present action has been relatively unremarkable. A continued options hearing was fixed after some unattributable administrative difficulties concerning adjustments and the first diet of debate (at which both parties were represented) was adjourned for lack of court time to a new diet on 1 February 1999. There was thus no prior default, important procedural failure or even truly dilatory conduct on either side; in particular the history of the case does not disclose any catalogue of prior defaults or delay on the defender's part. The error giving rise to the present default was manifestly not that of the defender himself and entirely that of his solicitor. The nature of the error itself (although described by the sheriff as "oversight of the grossest nature") was on the information presented to me of the purest inadvertence consisting I was told of transferring the entry from the rear pages of a 1998 diary to the wrong date or page in a 1999 diary, albeit the consequences may have been grave. Plainly it is always a serious matter when a party fails to be represented at a proof or debate but it is important to distinguish for present purposes between the gravity of the consequence and the casual nature of the mistake giving rise to that consequence. As to the defence stated on record it is clearly not purely skeletal, there being copious averments and many pleas and Mr Singerman did not seek to suggest at the appeal hearing that no substantive defence worthy at least of debate appeared ex facie of the pleadings: his position is I think that the defences will and should be held irrelevant when properly examined at debate. On this however I have not yet formed a view (it would be premature for me to do so) and a perusal of the record inclines me to think that the defence stated is sufficient at least to justify a testing of its relevancy at debate. The balance of these considerations leads me to the view that the grant of a decree by default in favour of the pursuer is not appropriate and for these reasons I think it proper that the defender should now be reponed against that decree by my sustaining this appeal and remitting the cause back to the sheriff to fix a new diet of debate. I should add for completeness that, differing from the sheriff, I do not consider the delay which has been occasioned to the pursuer's claim to be unduly onerous or causative of grave injustice to him, especially having regard to the history of the transaction and dispute which appears from the pleadings. Nor do I consider the defender's position to be fully protected by the existence of any claim he might have against his solicitor arising out of the default: actions of professional negligence give rise to all sorts of additional considerations which may have the effect of not fully restoring the ill-served client to the position in which he would otherwise have been and have to be viewed as very much a secondary and often imperfect remedy.

As to the expense which has arisen, the defender's solicitor who appeared before me at the hearing of the appeal accepted fully that the error had been entirely that of himself or his firm (most probably his own) and that he should bear the expense of the abortive diet of debate and of the appeal required to set matters right. Certainly I think it right that the pursuer should be kept free of expense and I shall accordingly find the defender's solicitor personally liable to the pursuer in the expenses of the diet of debate set down for 1 February 1999 and in the expenses of the appeal.