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You are here: BAILII >> Databases >> Scottish Sheriff Court Decisions >> Maxwell Farms Ltd v. John Rennie and Son [2004] ScotSC 14 (19 February 2004)
URL: http://www.bailii.org/scot/cases/ScotSC/2004/14.html
Cite as: [2004] ScotSC 14
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SHERIFFDOM OF GRAMPIAN HIGHLAND AND ISLANDS AT BANFF
A105/02
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JUDGEMENT of SHERIFF PRINCIPAL SIR STEPHEN S T YOUNG Bt QC |
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in the cause |
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MAXWELL FARMS LIMITED |
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Pursuers and Appellants |
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against |
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JOHN RENNIE AND SON |
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Defenders and Respondents |
Act: Mr P M Macdonald, advocate, instructed by Lefevre Litigation, Aberdeen
Alt: Mr D M G Russell, solicitor, Simpson and Marwick, Edinburgh
Banff: 19th February 2004
The sheriff principal, having resumed consideration of the cause, refuses the appeal and adheres to the interlocutors of the sheriff dated 16 October and 18 November 2003; finds the pursuers and appellants liable to the defenders and respondents in the taxed expenses of the appeal (including the amendment procedure during the hearing of the appeal) and allows an account thereof to be given in and remits the same to the auditor of court to tax and to report; quoad ultra remits the cause to the sheriff to proceed as accords.
Note
[1] In this case the pursuers and appellants seek decree against the defenders and respondents for payment of the sum of £62,886.77 to compensate them for the loss, injury and damage said to have been sustained by them as a result of breaches of contract on the part of the defenders. The latter tabled as their first plea-in-law a general plea directed to the relevancy and specification of the pursuers' averments and, following a debate, the sheriff by interlocutor dated 16 October 2003 sustained this plea and dismissed the action. Subsequently by interlocutor dated 18 November 2003 he found the pursuers liable to the defenders in the expenses of the action. The pursuers have now appealed, and in a nutshell they maintain that the sheriff erred in law in dismissing the action.
[2] In article 2 of the condescendence the pursuers aver that they carry on business as farmers and that they grow a number of vegetable crops for supply to supermarkets for sale to consumers as fresh vegetables. They specialise in the production of potatoes, carrots and turnips. In order that they can produce sufficient vegetables, they lease a number of fields from other farmers. For the 2001 growing season they leased a 37 acre field in order to grow turnips. They aver that about 4 acres of this field had been used to grow turnips in recent years and that the rest of the field had not been used to grow turnips for many years. There was a risk that any turnips grown on the 4 acres which had previously been used for turnip production might develop a disease known as club root. But it is said that, as the rest of the field had not had turnips grown on it for many years, there was no risk that club root would affect the other 33 acres of the crop.
[3] In article 3 of the condescendence the pursuers explain that the aim when growing crops, such as turnips, for supply to supermarkets is to produce an evenly sized crop of clean and unblemished turnips. They then describe how they prepared the field in question for planting turnip seed. They aver that, on the day after the seed was sown, it was sprayed with a particular type of weedkiller. The work of applying this was contracted by the pursuers to the defenders. Thereafter in this and the succeeding articles of condescendence the pursuers go on to aver how the turnip crop in the field in question was damaged as a result of breaches of contract on the part of the defenders. No issue arises at this stage in the proceedings about the relevancy of these averments.
[4] The pursuers' averments of loss are to be found in article 9 of the condescendence. These are the averments which were successfully attacked by the defenders before the sheriff, and it will be convenient therefore to set them out in full. As amended they now read as follows:
As a result of the said breaches of contract, the pursuers suffered loss, injury and damage. About one fifth of the seedlings in the said field were killed outright by the weedkiller. The remaining crop was damaged by the weedkiller. This resulted in the turnips being of uneven size. Many of them were misshapen. Many of them had badly marked skins. Because some of the turnips had been killed, this made more space for some of the surviving turnips to grow. The effect of this was that many of the turnips were of above average size. Many others were too small. As a result of all of these problems with the turnips, the crop from the said field was not suitable for selling to supermarkets. The crop was due to be harvested in the field from January to March 2002. Had the crop not been adversely affected by the spraying by the defenders, it would have yielded 36 tonnes per acre when lifted from the ground. When this amount of turnips are washed, graded and trimmed, it yields 21 tonnes per acre to send to the supermarkets. In order to produce one acre of turnips, the pursuers incur costs of £1,585.50 per acre. This is made up of £549 per acre in respect of growing costs for cultivators, seeds, fertilisers, spraying, hoeing and rent; £180 per acre in respect of the cost of harvesting, £216 per acre in respect of haulage for the turnips to take them from the field to the wash-house in Auldtown (36 tonnes at £6 per tonne); £189 per acre in respect of washing, grading and bagging the turnips (21 tonnes at £9 per tonne); and £451.50 in respect of distribution to supermarkets (21 tonnes at £21.50 per tonne). The pursuers could have sold the full yield of the said field to Morrisons Supermarkets in January to March 2002 at a price of £230 per tonne packed out. Each acre would have yielded 21 tonnes to Morrisons which would pack out at 18 tonnes. Thus, the pursuers would have earned £4,140 per acre in respect of the crop from the said field, or £153,180 from the whole field. About one half of the turnips in the 8 acres which had previously been used to grow turnips was affected by club root. Accordingly, the pursuers would have lost the equivalent off the yield of 4 acres. This amounts to £16,560. Thus, the pursuers have suffered a loss of income from the supermarket crop of £136,620. The pursuers' anticipated costs for the said 37 acres totalled £58,663.50. Thus, they should have made a profit of £77,956.50 from the turnips being grown in the said field. The pursuers managed to obtain an average of 6 tonnes per acre of packing turnips. They had the same growing costs of £549 per acre, and the same harvesting costs of £180 per acre. They spent £60.71 per acre transporting the crop to the wash-house. They spent £54 per acre washing and grading the turnips. They spent £129 per acre transporting the turnips to Morrisons Supermarkets. Thus, they spent a total of £35,990.27 to produce the crop which they managed to grow in the said field. They received £230 per tonne in respect of the said turnips. Thus, they earned a total income of £51,060, and made a net profit of £15,069.73. The pursuers have made £62.886.77 less profit than they would have done but for the said breaches of contract by the defenders. This is the sum sued for. The pursuers seek damages for the said loss, injury and damage. The sum craved represents reasonable damages for the said loss, injury and damage. With reference to the Defenders' averments in answer, these are denied except insofar as coinciding herewith.
[5] Counsel for the pursuers submitted that I should allow the appeal and remit the cause back to the sheriff to fix a proof before answer of the parties' respective averments. He submitted that very little needed to be pleaded to support a claim, as in the present case, for loss of profits. A bald averment by the pursuers that they had lost a profit of £x would have been sufficient to entitle them to a proof of their loss. Counsel referred here to the decision of the Extra Division in The Globe (Aberdeen) Limited v North of Scotland Water Authority 2000 SLT 674. He submitted that this decision (to which the sheriff was not referred despite the fact that counsel for the pursuers apparently represented the pursuers there too) was binding on me with the result that I should hold that the pursuers in this case had averred more than enough to entitle them to a proof of their averments of loss.
[6] In Globe the proprietors of a public house raised an action against the local water authority, as statutory successors to the local authority, to recover losses allegedly sustained due to the prolongation of sewer replacement work. The local authority had informed the proprietors that the works would take six weeks. The works took over nine months, and allegedly created muddy pavements which the pursuers averred were a deterrent to customers and amounted to a nuisance resulting in their loss of profits. The sheriff dismissed the action on the basis, inter alia, that the averments of loss of profit were too inspecific to go to proof. These averments were as follows: "Due to the carrying out of the said works the pursuers' trade dropped. It did so because no one wanted to drink in a public house which could only be approached along a muddy pavement. The pursuers' profits suffered as a result. During the period of the said works the pursuers suffered a loss of profits of £36,445.50. When the works were completed, it took several months for the pursuers' trade to return to normal. This also cost the pursuers money". On appeal, the Extra Division held that the averments of loss of profit were sufficiently specific to justify a proof before answer. The point was dealt with in the opinion of the court delivered by Lord Coulsfield at paragraph [11] as follows:
[11] That, of course, leaves over the question whether the averments of financial loss are themselves sufficiently specific. The sheriff's reason for holding them lacking in specification was that they did not give fair notice of the duration of the period of loss or how the sum averred was arrived at and did not aver what loss was sought in respect of the period after the works were completed. We must respectfully differ from the opinion expressed by the sheriff on this issue. In our view, the averments clearly relate to the period between the alleged reasonable time for the completion of the works, about six weeks, and the actual period required, nine months. The sum by which the pursuers' trade is alleged to have been diminished is specifically stated and while the calculation is not specified, the defenders can no doubt recover any material documents which may bear on that calculation. The period of diminished business after the cessation of the works is also specified, within a broad margin, and in our view there is no real reason why these averments of loss should not go to proof.
[7] Counsel for the pursuers submitted that the decision in Globe afforded the background against which the pursuers' pleadings in the present case should be tested. In contrast to what had happened in Globe, the pursuers in this case had in fact set out the basis of the calculation of their loss of profits upon which they relied. Unless there was something very obviously wrong with the way in which this calculation had been set out the pursuers' averments were sufficient to entitle them to a proof before answer of their claim that they had sustained a loss of profits in the sum of £62,886.77 on account of the defenders' breaches of contract.
[8] Counsel proceeded to examine the detailed figures in article 9. In their original form some of these clearly did not add up. When I pointed this out to counsel, he moved that certain of these figures should be amended, and this was not opposed by the defenders' solicitor. I allowed the amendments to be made accordingly (but subject to reservation of all questions of expenses relating thereto). The figures do now add up, and at this stage I do not think that it is necessary to examine them in detail. But I should record that counsel for the pursuers conceded that, in calculating what their loss of profit would have been but for the defenders' breaches of contract, the pursuers were obliged to deduct the costs of planting 37 acres, namely £58,663.50, despite the fact that, at best, only 33 acres of the field would have yielded a crop of turnips, the remaining 4 acres being affected by club root (for which the defenders were not said to have been responsible).
[9] Referring to the detailed figures in article 9, counsel for the pursuers submitted that it was not for them to explain as a matter of averment how each of these individual figures had been derived. If it were otherwise, there might be no end to the pleadings. The pursuers had already gone well beyond what they had been required to do in light of the decision in Globe. Nor did the pursuers require to explain the apparent discrepancies in their pleadings between what their costs would have been but for the defenders' breaches of contract and what they in fact were (albeit that there was in fact a straightforward explanation, namely that in the event the yield of turnips per acre had been less than it would have been but for the defenders' breaches of contract).
[10] In summary, counsel submitted that the pursuers had given to the defenders far more notice of their case than they needed to do and that there was sufficient on record to enable the defenders to recover by way of specification such documents as they might require to check the pursuers' figures and to prepare for proof.
[11] In response, the defenders' solicitor submitted that the defenders were entitled to an exposition of the calculation of the pursuers' loss of profit which disclosed the basis of the assumptions within the figures set out in article 9. The defenders' solicitor referred to Jamieson v Allan McNeil & Son WS 1974 SLT (N) 9 (referred to in Macphail's Sheriff Court Practice (2nd Edn) at paragraph 9.34). In that case the pursuers raised an action against a firm of solicitors for payment of damages in respect of the loss which, she averred, she had suffered through the fault and negligence of one of the partners. The defenders pleaded that the averments of the pursuer were irrelevant and that the action should be dismissed. In sustaining this plea and dismissing the action Lord Maxwell said:
For the defenders it was, as I understood it, suggested that, there being a case of alleged professional negligence, I should take a somewhat strict view of the pleadings ......... I do not see any reason to apply any specially stringent test of relevancy because professional negligence is alleged. But it is my understanding that our system of pleading still requires in actions for damages for negligence first, that the essential facts relied on should be set out with reasonable clarity; second, that the duties alleged to have been breached should be plainly stated and should be duties which the court can be satisfied at least might have been incumbent upon the defenders in law in the circumstances averred (Stevenson v Glasgow Corporation 1908 SC 1034, per Lord Kinnear); third, that it should be reasonably apparent how any alleged loss is claimed to be attributable to any one or more alleged breaches of duty; and, fourth, that in so far as the nature of any head of patrimonial loss permits, at least some notice should be given of the amount claimed under that head and, in any event, of the basis of quantification proposed to be relied upon. As regards this last point, in practice in actions for damages for personal injuries no overall figure is usually stated for the wage loss as opposed to the solatium element, but, even in these cases, some basis for the assessment for the loss of wages is given in the form of a statement of pre-accident wages.
[12] The defenders' solicitor took from this decision that it was necessary in a case such as the present that the pursuers should give notice, not only of the amount claimed, but also of the basis of quantification of this amount. He accepted that some quantification had been given, but he submitted that the defenders were entitled to be told what was the factual basis underlying the averment upon which the pursuers' calculations proceeded, namely that, had the crop not been adversely affected by the spraying by the defenders, it would have yielded 36 tonnes per acre when lifted from the ground. The defenders' solicitor pointed out that there could have been various ways in which the pursuers could have estimated this yield of 36 tonnes per acre. Were it not for the fact that the greater part of the field in question had not been used to grow turnips for many years, they might have looked at the yield from that field in the previous year. Alternatively, they could have based their estimate of the yield on the yield from a neighbouring field, or on the average of the yields from a number of neighbouring fields. Again, they might have taken into account figures produced by the Scottish Colleges of Agriculture showing what could be expected to be the typical yield from a field of turnips.
[13] Turning to the production costs which had been averred by the pursuers, the defenders' solicitor submitted that these figures hung in the air and were not grounded in any reality so far as the defenders were concerned. Again the pursuers had not stated the basis upon which these costs had been calculated. They might, for example, have been based upon the costs incurred by the pursuers in planting a neighbouring field in the previous year, or they might have been based on the average costs of planting a number of fields or they might again have been based on figures produced by the Scottish Colleges of Agriculture or a management consultant. It was, said the defenders' solicitor, important to the defenders in their investigations for the proof to be told what was the basis of these costs. If, for example, these were based on national average figures, then the defenders would need to look at the field in question against the assumptions upon which the national average figures were based. Likewise, if the costs stated by the pursuers were based on those incurred by them at a neighbouring field in a previous year, the defenders would require to compare the characteristics of that field with those of the field which was the subject of the present claim. The problem for the defenders at present was that a specification of documents based on the existing averments would not entitle them to recover the documents which they required to test the accuracy of the assumptions underlying the pursuers' averments in relation to the costs which would have been incurred by them. Until the figures stated by the pursuers were grounded in reality, the defenders could not prepare properly for proof.
[14] The defenders' solicitor suggested that the deficiencies which he had identified in the pursuers' averments could be remedied by the insertion of only a few additional sentences. Thus, the averment that the field in question would have yielded 36 tonnes per acre could be buttressed by an averment that this was based, for example, on the pursuers' experience of growing turnips in the previous year in a specified field nearby. Likewise the averments in relation to the pursuers' costs could be supported by an averment that these costs had been calculated on the basis, for example, of the average costs incurred by the pursuers across other fields on their farm. The defenders' solicitor posed the question why the pursuers were not prepared to incorporate such averments into their pleadings when it would cost them nothing to do so. Here the defenders' solicitor referred to the observation of the sheriff at page 5 of his note where he stated: "When true figures are available but not produced there is ground for criticism anent frankness". The defenders' solicitor submitted that there had indeed been a lack of frankness on the part of the pursuers which ought not to be allowed.
[15] Turning to the pursuers' averments of their dealings with Morrisons Supermarkets, the defenders' solicitor pointed out that the pursuers had not produced any contract between themselves and Morrisons. Thus the defenders did not know if the contract had been that the pursuers should provide Morrisons with, for example, 500 tonnes of turnips, nor did they know whether the pursuers had actually been able to satisfy this demand from turnips grown on their other fields with the result that the value of the turnips grown on the field in question would in any event have been nil.
[16] The defenders' solicitor submitted that the pursuers had a duty to minimise their loss by buying in turnips of a suitable quality to satisfy their contract with Morrisons. The pursuers, so it was said, should have investigated the cost of buying in other turnips and should be in a position to aver, if appropriate, that there had been no turnips available at reasonable cost to satisfy their contract with Morrisons. Here the defenders' solicitor referred to Gunter and Co v Lauritzen 1894 31 SLR 359. In that case the defender contracted to supply to the pursuers a cargo of Danish hay and straw. In the event the cargo was admittedly disconform to contract, and the pursuers claimed, inter alia, a sum to compensate them for the loss of the profit that they would have made on a sub-sale of the goods had they not been disconform to contract. At page 360 Lord Stormonth Darling stated:
It is clear in the first place, on the principle of Hadley v Baxendale, that the damage which the defender was bound to make good in the event of his breaking the contract, was such as might be held to have been in contemplation of the parties at the time of making the contract, and in this case the damage contemplated was the loss of profit on the re-sale. The defender says that there is an equitable limitation to this rule to the effect that the purchaser, before he can recover such loss of profit, must show that he has taken every means to supply himself with similar goods, and unless he does so he is barred from recovering. That may be the equitable rule where the goods are of a kind currently bought and sold in the open market at the time and place of delivery. If the purchaser can go into the market and supply himself with goods of the same quality and at a price not greater than that in the contract, then he would suffer no damage, for he would be able to fulfil his contract with the sub-purchaser. But the goods in question were of a very special kind; they were specially consigned from a foreign country, and it is the result of the evidence, in my opinion, that at Aberdeen, which was the port of delivery, there was not a market for these goods at the time at all. The defender had led evidence to show that, by hunting all over the country, the pursuers might have found out that there were small parcels of Danish hay and straw at Leith and other places, which he might have picked up by private treaty; but none of these parcels were on public offer at the time, or quoted in any public market list which was open to the pursuers' inspection. In these circumstances I think there was no duty on the purchaser to make extraordinary exertions to supply himself with goods elsewhere.
[17] The defenders' solicitor submitted in light of this decision that there had been a duty on the pursuers in the present case to make exertions, although not extraordinary exertions, to supply themselves with turnips from elsewhere. Thus, as a matter of relevancy, they should have averred whether they had or had not sought to obtain replacement turnips elsewhere in order to demonstrate whether or not they had complied with this duty. If they had failed to do so, then, as I understood the defenders' solicitor, they were not entitled to recover from the defenders. In the present state of the pleadings the defenders could not prepare to deal with the case against them on this point while they remained in ignorance whether or not the pursuers had made exertions to obtain an alternative supply of turnips.
[18] The defenders' solicitor pointed out that there were no averments about what had happened to the turnips which were either too large or too small for sale to Morrisons. It was not said whether these were valueless or whether they had in fact had a salvage value which ought to be deducted from the amount of the pursuers' claim. It might have been expected, for example, that the costs of taking these surplus turnips to a tip would have been sought by the pursuers, but they had not done so. Under reference to Pomphrey v James A Cuthbertson Limited 1951 SC 147, the defenders' solicitor submitted that the pursuers' pleadings were irrelevant in the absence of an averment of the salvage value of the turnips which had been grown in the field and which could not be sold to Morrisons Supermarkets. In Pomphrey the owner of a motor car which was seriously damaged in an accident with a lorry driven by one of the defenders' employees sought damages measured, in short, by the cost of acquiring a replacement vehicle plus the cost of hiring a substitute vehicle until this was done less the "scrap value" of the damaged vehicle. This basis of quantification was rejected by the Second Division. At page 153 the Lord Justice Clerk (Thomson) stated: "(The pursuer's) figure must be brought into comparison with the figure required to put the pursuer in the position in which but for the accident he would have been. That is the proper ceiling. The pursuer was put into that position by getting (first) the market value of his vehicle, and (second) the hire of a substitute vehicle during the period in which he was looking for, negotiating for, and it may be adapting his fresh vehicle, under deduction, of course, of anything he gets in the way of "scrap value". That calculation affords the proper basis of comparison. Market value is recognised as the measure of damages in all cases of total loss".
[19] Turning to the Globe case, the defenders' solicitor suggested that it was difficult to take a ratio from the decision, given that the arguments of the parties had not been rehearsed in the opinion of the court, nor had there been any reference to any reported cases. Against this background the defenders' solicitor submitted that the authority of Globe must be in some doubt, and that in any event the circumstances of that case were readily distinguishable from those of the present case. The submission that it was enough for the pursuers in this case to say, without more, that their loss of profit had been £x flew in the face of the decision in Pomphrey.
[20] The defenders' solicitor further submitted that the pursuers' averments lacked specification in that they contained no details about the overheads of their business such as insurance costs, depreciation, tax, national insurance, fuel costs and the like. In order to work out the true figure for the pursuers' loss of profit on the field in question, a proportion of these overheads should, said the defenders' solicitor, have been deducted as an expense in calculating this loss of profit. It was pointed out that a claim for loss of profits was not an easy one to defend since no one knew the pursuers' business better than they did themselves. The questions which had been asked by the defenders about the basis of the pursuers' claim were reasonable ones which would not cost the pursuers anything to answer at this stage. They would have to provide the information at the end of the day, so it had to be asked why the should not do so now, given in particular that responsible solicitors nowadays were encouraged to settle cases as soon as possible and before unnecessary expense had been incurred. The pursuers' case was not yet time-barred so that the prejudice to them if it were to be dismissed would be only that they would be penalised in expenses. The prejudice to the defenders was that they could not properly prepare for proof in light of the pursuers' pleadings as they stood at present - and here the defenders' solicitor explained that he was himself preparing the defenders' case for proof and that he had been careful not to overstate the difficulties which faced them.
[21] Replying to the submissions of the defenders' solicitor, counsel for the pursuers submitted that certain of the arguments which had been advanced for the defenders had gone well beyond the terms of their rule 22 note and this, said counsel, they were not entitled to do in light of rule 22.1(4). But he had no answer to the response to this point of the defenders' solicitor, namely that this particular rule is not stated to apply in the context of an appeal to the sheriff principal.
[22] Responding to the defenders' complaint that they had not been given fair notice of the pursuers' claim, counsel drew attention to the terms of answer 9 where the defenders' aver, inter alia, that in their calculations the pursuers had failed to take proper account of the unfavourable nature of the field, its propensity to weed, rabbit and soil borne disease problems and its hilly and exposed nature, that the pursuers' anticipated yields, both gross and graded, were excessive, inadequate account having been taken of deductions in respect of costs of growing, and that the level of profit anticipated on the pursuers' figures were not achievable in respect of the crop in question. Counsel submitted that, these averments having been incorporated responsibly into their pleadings, the defenders would not be prejudiced in preparing for the proof and that on the strength of these averments they would be entitled to recover all the documents that they would need to test the pursuers' case. Counsel drew attention to the fact that the defenders had been granted a commission and diligence to recover certain documents, and he suggested that the defenders already had all the documents which they needed. As for the point about overheads, these were fixed and would be incurred whether or not the pursuers made a success of growing turnips in the field in question. Thus they did not affect the loss of profit sustained by the pursuers as a result of the defenders' breaches of contract. As for the decisions in Gunter, Pomphrey and Jamieson, the circumstances of these cases were all readily distinguishable from those of the present case, and Gunter moreover was a case decided before the enactment of the Sale of Goods Act 1893.
[23] As I understood the submission of counsel for the pursuers, the decision of the Extra Division in Globe is to be read as meaning that, in every case in which a pursuer seeks damages from a defender as compensation for a loss of profit sustained by him as a result of acts or omissions on the part of the defender, a bare averment that the loss of profit amounted to a specified sum is sufficient notice to the defender of the facts which the pursuer intends to prove in order to establish that he sustained a loss in the sum specified. If this is correct, then plainly I should be obliged by the decision in Globe to hold in the present case, as counsel suggested, that the pursuers had averred more than enough to satisfy the requirement that they should give fair notice to the defenders of the case that is to be made against them in regard to their alleged loss of profit.
[24] But this is not the way I read the decision in Globe. It seems to me that it is a decision based, as is every decision in which an issue of specification arises, on its own facts and circumstances which are readily distinguishable from those of the present case. Thus it was a claim based on nuisance rather than breach of contract, and it was one in which damages were sought as compensation for the loss of profit caused by an interference with the trade of a public house rather than the loss of profit caused by damage to a field of growing turnips. And perhaps most importantly, the pursuers in the present case, far from seeking to hide behind the principle which counsel sought to take from Globe, have attempted to specify in some detail the factual basis of their claim for loss of profit - with what success I shall consider shortly.
[25] It is I think trite law that the fundamental question which has always to be asked when a plea of lack of specification is taken is whether the averments under attack give fair notice to an opponent of the facts which a party hopes to establish in order to set up his case. The matter is put thus in Macphail's Sheriff Court Practice (2nd Edn) at paragraph 9.29:
The defender may seek dismissal of the action upon a plea of lack of specification. That plea finds its proper application in a case where the defender does not know the case against him and objects to being taken by surprise at the proof. It is possible for a condescendence to be relevant, in respect that it states facts sufficient to render the action relevant in law, but to be lacking in specification in respect that it does not give fair notice of all the facts which the pursuer intends to establish. The degree of specification which will be deemed sufficient for fair notice depends on the particular circumstances of each case. Enough specification must be given to enable the other party to identify what is being alleged against him and to prepare his case. Any material dates, times and places which ought reasonably to be known to the pursuer should be specified; but in certain circumstances averments may be sufficiently specific if facts peculiarly within the defender's knowledge cannot be averred because of practical difficulties. When deciding whether the defender has been given fair notice of the pursuer's case the court will consider the matter broadly, and will regard a complaint of lack of fair notice as justifiable only if it is likely to result in material prejudice to the defender.
[26] In the present case the fundamental premise which underlies all the pursuers' averments about their supposed loss of profit is to be found in the averment towards the beginning of article 9 which reads: "Had the crop not been adversely affected by the spraying by the defenders, it would have yielded 36 tonnes per acre when lifted from the ground". It is on the basis of this projected yield of 36 tonnes per acre that the pursuers go on to say that they would have been able to send 21 tonnes per acre to Morrisons which in turn would have packed out at 18 tonnes per acre.
[27] This averment of a projected yield of 36 tonnes per acre is an averment of inference rather than primary fact. It must therefore be based on other facts within the knowledge of the pursuers which they hope to prove in order to set up the inference, and in my opinion the requirement of fair notice demands that the defenders should be told what these other facts are. Commonly an averment of inference is introduced by the words "Believed and averred ....." and, when this is done, it is I think well settled that the averment must be supported by other averments of fact from which the inference may reasonably be drawn. Here the pursuers do not use the words "Believed and averred ....." but the principle is in my opinion exactly the same. If they are going to seek to demonstrate that, but for the defenders' breaches of contract, the field in question would have yielded 36 tonnes of turnips per acre when lifted from the ground, they must in my view explain to the defenders upon what factual basis they propose to do this. And this they have clearly not done.
[28] In this context it will not do in my opinion for the pursuers to point to the defences in support of their assertion that the defenders would not be prejudiced by their own failure to specify the factual basis upon which they hope to establish the projected yield of 36 tonnes per acre. It is perfectly intelligible that the defenders may have their own reasons for supposing that such a yield would not be capable of achievement and at the same time remain in ignorance of the pursuers' reasons for saying that it would be. Nor in my view will it do for the pursuers to say that the defenders may seek to recover such documents as they may require in order to ascertain what this basis is. This is a matter peculiarly within the knowledge of the pursuers, and I do not think that it is right that the defenders should be forced to go to the trouble and expense (and uncertain outcome) of recovering documents when, as the defenders' solicitor rightly pointed out, it would be a straightforward matter for the pursuers to aver this basis. As the defenders' solicitor also pointed out, the emphasis in litigation nowadays is more and more on encouraging parties to achieve an early resolution of their disputes. To this end they must be open and candid about their respective positions so that the true issues between them can be properly identified. This the pursuers have not in my opinion been on this fundamental matter. And since it is indeed fundamental to their case, it follows in my opinion that there is here a lack of specification in their pleadings which justifies dismissal of their claim in its present form.
[29] Turning to the basis upon which the pursuers' costs of £1,585.50 per acre have been calculated, I think that it is clear enough that the sums of £549 per acre in respect of growing costs and £180 per acre in respect of harvesting costs are based on actual costs since these same figures reappear when the pursuers explain what did in the event happen after the crop had been variously damaged or destroyed as a result of the defenders' breaches of contract. Likewise it seems fairly clear that the sums of £189 per acre in respect of the costs of washing, grading and bagging and £451.50 per acre in respect of distribution costs are based on the actual costs since there the corresponding sums were £54 per acre and £129 per acre, and £189 and £54 are both multiples of £9 while £451.50 and £129 are both multiples of £21.50 - the multipliers in each case being 21 and 6 respectively. (In passing, I should perhaps observe that it was not argued that a multiplier of 7 rather than 6 should have been applied to these actual costs incurred by the pursuers). The difficulty seems to me that there is no obvious way of reconciling the sum of £216 per acre in respect of the costs of haulage to the wash-house, which the pursuers say that they would have incurred if the field had yielded 36 tonnes of turnips per acre (36 tonnes at £6 per tonne), with the sum of £60.71 per acre in respect of haulage costs which they say that they in fact incurred. Counsel for the pursuers said that the discrepancy here was explained by the fact that the actual yield was less than 36 tonnes per acre so that it was inevitable that the haulage costs per acre would be lower. That is true as far as it goes. But it still does not explain the precise figures quoted by the pursuers since there is no whole number (apart from 1) of which both £216 and £60.71 are multiples. So here too there is a lack of specification in the pursuers' pleadings. I hesitate to say whether I should have thought it right to dismiss the action on this ground alone. But the point is in any event academic in view of my conclusion on the much more fundamental issue of the factual basis for the pursuers' claim that the field would have yielded 36 tonnes of turnips per acre but for the defenders' breaches of contract.
[30] As for the turnips which were grown in the field and which were too large or too small to be sold to Morrisons, in the eighth and ninth sentences of article 9 it is said that there were "many" such turnips. I consider that the defenders are entitled to be told what happened to these, and in particular whether on the one hand they had a value which ought to have been deducted from the pursuers' claim or whether, on the other hand, they had no value at all. Here it is to be observed that the discrepancy between the hypothetical haulage costs of £216 per acre and the actual haulage costs of £60.71 per acre suggests that a large proportion of the crop may have been left in the field after being harvested. In the absence of averments dealing with these matters, it is impossible to say if the net profit of £15,069.73 said by the pursuers to have been earned from the sale of turnips in the event grown in the field is accurate or not - and, if it is not accurate, it follows that the overall loss of profit claimed by the pursuers must also be inaccurate. I agree therefore with the defenders' solicitor that, in light of their silence on these issues, the pursuers' pleadings are irrelevant as they stand.
[31] On the other hand, I do not think that the defenders' solicitor was correct to say that the pursuers ought, as a matter of relevancy, to have averred whether or not they had sought to obtain replacement turnips elsewhere in order to satisfy their contract with Morrisons. It seems to me that on this aspect of the matter the onus, at least of averment, is on the defenders, if they wish, to assert that the pursuers failed to mitigate their loss by going out into the market place to supply themselves with turnips from elsewhere.
[32] I also think that the defenders' solicitor was wrong to complain about the absence of any details in the pursuers' averments about their overheads. To the extent that they are not already reflected in the costs, hypothetical or actual, which the pursuers have specified, these overheads would I think have been fixed and so, as counsel for the pursuers rightly observed, would have had no effect upon the loss of profit sustained by the pursuers as a result of the defenders' breaches of contract.
[33] On the whole matter I think that the sheriff was correct to sustain the defenders' first plea-in-law and to dismiss the action accordingly. I have therefore refused the appeal.
[34] The defenders having been successful, I have awarded the expenses of the appeal to them. In this situation it is unnecessary that I should deal with the motion for the pursuers to the effect that I should certify the appeal as suitable for the employment by them of junior counsel. Had it been necessary to deal with this motion, I think that I should have refused it. In my opinion the issues canvassed in the appeal were well within the capabilities of a competent and experienced solicitor, and I do not think that it would have been right therefore that the defenders should have had to meet the expense of the employment of counsel by the pursuers.