Scottish Sheriff Court Decisions

LORRAINE WALKER OR PARK v. ANDREW PARK and MARTIN A VALENTE [1999] ScotSC 3 (11th March, 1999)

The Sheriff Principal having resumed consideration of the appeal Refuses same; Adheres to the Sheriff's interlocutor of 8 December 1998 complained of; Sanctions the appeal as suitable for the employment of a solicitor-advocate; Appoints parties to be heard on the expenses of the appeal on Monday 22 March 1999 at 10.30 am.

NOTE:

In this action the pursuer sues for inter alia divorce and a capital sum. She claims that the defender's assets at the date of separation included inter alia 16,000 shares in a company named Boss Valmar Handling Systems Ltd which had a substantial value (she says £185,000). This company had been created by a Mr Valente and the defender, a friend of his, had helped him in it and become a shareholder. The pursuer suspected that there may have been an "avoidance transaction" transferring the defender's shares to Mr Valente and introduced a crave to meet this possibility which was intimated to Mr Valente who then entered the process as what has been called a "third party": I am not sure that "third party" is the correct designation for a party who enters the process in such circumstances (not being a party brought into it by the defender) but since he has been referred to throughout as "the third party" until now I shall for convenience continue to use that designation for him here.

On 8 December 1998 a diet of proof had been fixed and all three parties appeared when the case first called and again when it was re-called about one hour later: the pursuer and defender were each represented by counsel and the third party by a solicitor-advocate all duly instructed by local agents. During the days prior thereto there had been certain negotiations between counsel for pursuer and defender in consequence whereof Mr Williamson (the solicitor-advocate instructed for the third party) had been informed by them before even coming to Paisley that the status of the said shares (ie whether or not they fell to be regarded as part of the matrimonial property) was no longer in issue and the continued presence of the third party during the forthcoming proof was no longer going to be necessary: nevertheless appearance for the third party was still required before the Sheriff at the calling of the proof for matters to be formalised. Prior to coming to Paisley counsel had adjusted between them a document (referred to before me as a "joint minute of admissions") which they brought with them. It had not yet been signed but included an agreement as to the status of the said shares. By the time the case called in court for the second time on 8 December counsel for the pursuer and defender had come together to the view that for various reasons the proof on the issues in dispute between them would have to be put off in any event; in addition the Sheriff had decided to give priority that day to another proof involving the welfare of children. When the case called a joint motion was made for discharge of the diet of proof and Mr Williamson for the third party moved the court to grant absolvitor in favour of his client, explaining the then current position between the parties as he understood it and being keen that his client should not be involved in further expense by remaining longer in the action, but to reserve meantime the matter of the third party's expenses (he having been informed by the others that one or both of them would bear those expenses but that agreement had yet to be reached between them as to the proportion to be borne by each). The Sheriff enquired of the other parties' positions and counsel for the defender stated that the shares were accepted as being part of the matrimonial property so that the presence of the third party was not further required and that she was ready and willing to sign a joint minute to that effect. Counsel for the pursuer adopted a similar position. Neither counsel voiced any opposition to the idea that the third party should be absolved and neither suggested that there was any reason why the grant of absolvitor to the third party should be postponed. The Sheriff took it that all parties were agreed upon the course proposed by Mr Williamson, indicated that he would grant absolvitor in favour of the third party, discharged the proof to another date to be fixed and proceeded to attend to the other proof involving the children. Later he signed an interlocutor in the following terms:-

"Paisley 8 December 1998. Act: Hodge

Alt: Stewart for defender: Williamson for 3rd Party

The Sheriff, on joint motion, Discharges the diet of Proof fixed for today,/; having heard 3rd Parties motion for Decree of Absolvitor in favour of 3rd Party Grants same; Reserves question of expenses quoad 3rd Party; Continues the cause to the Diet Roll of 17 December 1998 at 10 am for a 3 day Proof to be assigned.

(Signed) Th Welsh.".

After all parties had left court the document referred to before me as a "joint minute of admissions" (which I have not seen and which has not been lodged in process) was later that day signed by the local agents acting for both pursuer and defender; on the pursuer's side this was effected by counsel for the pursuer laying the document in front of her instructing agent (Mr Howat), informing him that this was the agreement adjusted between counsel during negotiations between them and suggesting that he sign it, which he did. At some later stage (seemingly the next day or within the next few days) he observed that the precise terms of the document he had signed were not identical on the matter of the shares to the terms of a draft he had seen at an earlier stage of the proposed agreement and he maintained before me that when signing the document he had assumed that its terms were the same as those of the previous draft. He then sought to persuade his opposite number, the local agent for the defender (Mr Wilson), to agree to sign a new document in terms of the earlier draft but was not successful in that endeavour. When asked by Mr Howat what then was the defender's position regarding the shares Mr Wilson responded, according to Mr Howat, to the effect that his client's position was as stated on record. Mr Howat then, taking the interlocutor of 8 December to be not a final interlocutor in respect of the third party on account of the matter of expenses having been reserved therein, sought leave to appeal that interlocutor to the Sheriff Principal. The Sheriff returned on 21 December 1998 to Paisley to hear the motion for leave to appeal, which was opposed, and refused it. The appeal has nevertheless proceeded to a hearing on the basis of a submission to the effect that the interlocutor of 8 December 1998 was incompetent and that leave to appeal against it is therefore unnecessary because the Sheriff Principal always has a supereminent power at common law to entertain an appeal against and overturn or otherwise rectify an incompetent interlocutor.

The foregoing narrative has been set forth at length by me as being, as I perceive it, the necessary factual background against which to consider and decide the questions raised in the present appeal. It contains what I regard as the essential facts gleaned from the account given by the Sheriff in his Note and the accounts laid before me at the hearing of the appeal on 4 February 1999 by Messrs Howat, Williamson and Wilson for each of the parties. These four accounts did not entirely cohere (in particular Mr Howat's differed from the others as to the extent or effect of the consensus which existed in court on 8 December 1998 among parties' representatives appearing before the Sheriff) but I think it true to say that the facts thus narrated are all agreed or at least not substantially disputed among them. Where and if it is necessary to prefer one account to another on any matter I do so in what follows, not in the narrative set out above. It will be noticed in particular that attention has been given above to the detail of the interlocutor's punctuation: this is because a point was taken before me turning upon whether the mark occurring between "today" and "having" was a comma or a semi-colon. From the principal interlocutor it can be detected that there exists a mark in the nature of a faint dot somewhere above and to the right of the comma which may or may not have been made by the Sheriff Clerk or Sheriff with the intention of converting the comma into a semi-colon.

As to the degree of consensus existing in court on 8 December 1998, Mr Howat maintained that those appearing for the pursuer and defender were agreeable to Mr Williamson's motion for absolvitor only in the event of the joint minute of admissions being signed, which had not yet happened, so that there was before the Sheriff no present agreement among all parties that absolvitor should be granted in favour of the third party there and then, only that such absolvitor should be granted in due course as and when the joint minute of admissions had been signed. Since that had never happened in a proper manner the consensus necessary for the granting of absolvitor had never come to true fruition and the Sheriff had "jumped the gun" by signing the interlocutor before seeing or being informed that the joint minute of admissions had in fact been signed. The other three (including the Sheriff as I apprehend from his Note) took the view that consensus existed in court to the granting of absolvitor in favour of the third party forthwith.

Several issues were raised and argued before me at the hearing of the appeal but it seems to me that the fundamental one, which I take therefore as the starting point, is whether or not the interlocutor complained of was indeed incompetent. If not, then leave to appeal was required and has not been obtained. In my opinion the interlocutor of 8 December 1998 was not incompetent in the sense required for present purposes as indicated in the cases of VAG Finance Ltd v Smith 1988 SLT (Sh Ct) 59 (by one of my predecessors, Sheriff Principal PI Caplan QC as he then was) and Gupta's Trustee v Gupta 1996 SLT 1098 (by the Court of Session). In those cases it was made clear that an interlocutor is to be viewed as incompetent (so as to be appealable without leave) only if it purports to do things which are beyond the powers of a Sheriff (eg allow by mere amendment of the instance substitution of one defender for another, as in Brown v British Rail Property Board 1983 SLT (Sh Ct) 19). It appears to me that all the things which the present interlocutor sets out to do are things well within the powers of a Sheriff, viz (1) discharge a diet of proof; (2) grant absolvitor in favour of a party; (3) reserve a matter of expenses for later consideration; (4) continue a cause to a diet roll to assign a diet of proof.

It was maintained for the appellant however that the present interlocutor was ex facie incompetent in respect that the granting of decree of absolvitor did not bear to be of consent and that such a decree could only competently be granted if either (a) the court had heard proof and delivered judgement thereon (which had not happened here) or (b) the decree was granted of consent and bore to be so. I am doubtful of the proposition (which was advanced without reference to authority) that these are the only two possible situations in which a decree of absolvitor can be granted: there was discussion before me of several situations in which a defender might be assoilzied not expressly of consent by reason of a pursuer failing to do what would normally be required of him at a peremptory diet such as a proof or in consequence of an abandonment or the like but it was suggested that these were all really instances of absolvitor by consent. One might figure other situations (not discussed at the appeal hearing) even more remote from express consent, eg failure of a pursuer to find caution for expenses having been ordained to do so which would normally result in absolvitor (see MacLaren on Court of Session Practice p.1092), where the concept of "consent" must become even more stretched in order to furnish an explanation of what is happening. However all that may be, I am even less convinced of the proposition that a decree in order to take effect as a decree of consent must expressly bear to be so by the inclusion of those or similar words: this proposition was likewise advanced without reference to authority save for a reference to a passage in Sheriff ID MacPhail's "Sheriff Court Practice" (Second Edition) at paragraph 5.81 where it is stated that such an interlocutor "must so state". The learned author himself cites no authority to vouch the proposition and I am not inclined to think that he meant by his statement that no interlocutor can as matter of law have the effect of being pronounced of consent unless it contains wording to that effect: rather I incline to the view that he is making a strong statement of "best practice" in the matter of framing such interlocutors, meaning thereby that the absence of such words may well give rise to serious difficulties (and lead, for instance, to appeals which would otherwise be unnecessary). I take the view that it must be possible to demonstrate aliunde that an interlocutor was in fact pronounced by agreement of all parties even if it does not bear ex facie to be "of consent", just as the converse is true namely that it is possible (although often difficult) to demonstrate that an interlocutor bearing to be of consent was truly granted without such consent or in circumstances where no true consent was given. I therefore reject the contention that the interlocutor of 8 December 1998 was ex facie incompetent by virtue of the absence from it of the phrase "of consent" (or words of similar meaning) in that part of it bearing to grant decree of absolvitor.

I should mention in passing that a submission was made on the defender's behalf to the effect that the presence of the words "on joint motion" at or near the outset of the present interlocutor cured any defect thought to arise from the absence of words later on such as "of consent" because all interlocutors are indivisible and the presence of the phrase "on joint motion" therefore carried through to the later parts of the interlocutor to indicate that they too were all pronounced by agreement of all parties. Reference was made to the cases of MacColl v MacColl 1992 SCLR 187 and Jones v Jones 1993 SCLR 151. It was suggested that the whole interlocutor was accordingly unappealable. While however interlocutors may be deemed indivisible for certain purposes, I do not consider that this doctrine can be extended to have the effect of importing phraseology clearly pertinent to that part of the order in which it appears into all other parts where it may well be in direct conflict with other wording already occurring in those other parts. In the present case the words "on joint motion" sit ill with the later words "third parties motion" and I am, moreover, willing to give the appellant the benefit of the doubt on the existence of a semi-colon (for what it is worth) after the word "today" and to treat each part of the interlocutor as making a discrete order uninfluenced by wording in other parts.

In any event I am satisfied on the narrative of events laid before me from all available sources at the appeal that the part of this interlocutor granting decree of absolvitor in favour of the third party must be taken to have been in fact pronounced with the agreement of all parties present in court before the Sheriff on 8 December 1998. I do not consider that I am bound merely to look at the terms of the interlocutor itself in order to determine this matter. It might have been a safer course for the Sheriff to adopt to wait until he could be assured that a joint minute to the effect spoken of by counsel had in fact been signed before granting decree of absolvitor but he was not in my view at all bound to do so having regard to the positions adopted in court before him by counsel appearing for the pursuer and defender. I certainly reject the suggestion advanced for the appellant that the facts demonstrate only a conditional or contingent consent indicated in court by the two counsel. In my view the facts indicate that at the time when the Sheriff indicated that he would pronounce decree of absolvitor in light of all that he had heard there existed in court complete consensus among all parties that the interlocutor to be signed by him should contain such a decree of absolvitor. It is nothing to the point to say that later on and in retrospect after all parties had gone home one of the lawyers advising one of the parties had doubts as to whether he should have signed the document adjusted and agreed between counsel. The fact is that he did sign it and the rights and wrongs of whether he should have done so are a matter entirely between him and his counsel and client, not a matter which can any longer affect his or the pursuer's position in relation to the other parties or the court. I therefore consider the interlocutor of 8 December 1998 to be not incompetent even if one accepts the proposition that a decree of absolvitor can only be granted (if not after proof) of consent (a proposition of which as stated earlier I remain doubtful).

It follows from the foregoing that the present appeal is itself incompetent, leave for it not having been obtained, and so falls to be refused.

As to expenses the agent for the pursuer sought a hearing thereon in the event of the appeal being unsuccessful and I have assigned a diet for such a hearing. It was suggested that varying considerations might arise affecting this matter depending on the grounds of a decision to refuse the appeal.

A motion was made on behalf of the third party for sanction of the appeal as suitable for the employment of a solicitor-advocate. I consider the questions of competency raised to be of sufficient complexity to justify the granting of this motion and in addition it seems to me reasonable to do so having regard to the fact that the same solicitor-advocate was the legal representative who appeared on behalf of the third party at the proof diet on 8 December 1998 out of which the appeal arose.

Although not in the end germane to my decision reached for the reasons given above, there is one matter placed before me on appeal on which I ought to express a view for the benefit of practitioners in the Sheriffdom since it is suggested that some confusion may now exist. In my view it remains open to the Sheriff Principal to entertain an appeal against an incompetent interlocutor even without leave for the reasons given in VAG Finance Ltd v Smith 1988 SLT (Sh Ct) 59 by Sheriff Principal Caplan and despite anything said in Gupta v Laurie 1994 SCLR 176 (whereon see further below). It has to be remembered however that "incompetent" has for this purpose been given by the judgments in those cases and in related decisions a strict meaning and appeals will therefore not be entertained without leave when an interlocutor purports to do things (as in my opinion this one does) normally within the powers of a Sheriff. As I interpret the decisions referred to it is only incompetency in the sense of attempting to do something which no Sheriff has power to do in any circumstances which opens up an interlocutor which is not final to possible appeal to the Sheriff Principal without leave first being obtained from the Sheriff.

The case of Gupta v Laurie 1994 SCLR 176 was referred to by Sheriff Principal Maguire in Gray v Gray 1996 SCLR 531 as "somewhat bizarre" and in the penultimate paragraph of his note (at page 535A of the report) he pointed out that it was a summary application (presented to a Sheriff Principal) wherein the applicant/petitioner was a party litigant and there was no discussion of authorities. Perhaps for these reasons there is, it seems to me, some room for debate as to what precisely was the ratio of the Court of Session's decision in refusing the petitioner's motion. The opinion of the court is set out at page 177 of the report and the essence of the decision appears to be contained in the paragraph printed between letters C and D there. From that paragraph the ratio of the decision appears on one view to have been that, since the petitioner's presentation of a summary application to the Sheriff Principal as a means of appealing against a Sheriff's interlocutor pronounced in sequestration proceedings was itself a nullity, any appeal to the Court of Session against the Sheriff Principal's refusal of that summary application was necessarily incompetent. Support for this interpretation may be found in what is said at the outset of the next paragraph but one at letter E where the court note that no appeal was taken against the original Sheriff's interlocutor complained of and that the proceedings before it were themselves not appeal proceedings. It may be therefore that the apparent difficulty presented by the intervening paragraph at letter D is no more than an obiter dictum whose truly intended meaning is reiterated lower down at letters E to F. It appears, reading between the lines, that the Second Division may have been grappling with some fairly vaguely formulated propositions advanced to them by a person not legally qualified. I take the view in any event that the case of Gupta v Laurie cannot be regarded as a clearly binding decision which displaces or overturns the line of authority leading up to and following on from VAG Finance Ltd v Smith to the effect that the Sheriff Principal has at common law a power to entertain an appeal against an interlocutor of a Sheriff without leave even if not final which is fundamentally or intrinsically incompetent in the sense indicated above.

In connection with this last matter I was referred to the following authorities:-

McKenzie v John R Wyatt (Musical Enterprises) Ltd 1974 SLT (Sh Ct) 8

VAG Finance Ltd v Smith 1988 SLT (Sh Ct) 59

City of Edinburgh District Council v Robbin 1994 SCLR 43

Gupta v Laurie 1994 SCLR 176

Gupta's Trustee v Gupta 1996 SLT 1098

Gray v Gray 1996 SCLR 531

ID Macphail, Sheriff Court Practice (1st and 2nd Editions)

Paragraphs 18 - 11, 18 - 12.

The Sheriff Principal, having heard parties' procurators on the question of expenses, Finds the appellant liable to the first and second respondent in the expenses of the appeal as taxed and 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 proceed as accords.

(Sgd) BA Kerr