Freely Available British and Irish Public Legal Information
[Home] [Databases] [World Law] [Multidatabase Search] [Help] [Feedback]
Scottish Sheriff Court Decisions
You are here: BAILII >> Databases >> Scottish Sheriff Court Decisions >> Connelly v. G Group Ltd & Anor [2004] ScotSC 44 (09 July 2004)
URL: http://www.bailii.org/scot/cases/ScotSC/2004/44.html
Cite as: [2004] ScotSC 44
[New search] [Help]
Connelly v. G Group Ltd & Anor [2004] ScotSC 44 (09 July 2004)
A3221/94
JUDGMENT OF SHERIFF PRINCIPAL EDWARD F BOWEN QC
in the cause
ROBERT CONNELLY
PURSUERS
against
(1) G A GROUP LTD and (2) STIELL FACILITIES LTD
DEFENDER
Act: No appearance for pursuer.
Alt: (First Defenders) J J Mitchell QC instructed by Anderson Strathearn.
(Second Defenders) D I Mackay QC instructed by Simpson & Marwick.
GLASGOW, 9 July 2004.
The Sheriff Principal having resumed consideration of the cause sustains the appeal and recalls part (3) of the sheriff's interlocutor complained of dated 20 January 2004; finds the first defenders liable to the second defenders in the expenses, including the expenses of the appeal and remits the account thereof, when lodged, to the auditor of court to tax and to report thereon; certifies the cause as suitable for the employment of senior counsel for the purposes of the appeal.
NOTE:
[1] This is an appeal on a question of expenses. The facts which give rise to the action are relatively straightforward. On 27 January 1992 the pursuer was working in his capacity as a labourer employed by the first defenders at the Bon Secours Hospital, Mansionhouse Road, Glasgow. He was required to strip out a ceiling in the X-Ray Department. He alleged that in the course of doing do he touched a live light fitting, sustained an electric shock, and in pulling his hand away suffered a severe laceration to the right forearm.
[2] On 29 July 2003 this action was raised against the first defenders. The pursuer sought damages of £750,000. The first defenders' response was to the effect that the accident as averred by the pursuer was impossible. They said that they had employed E J Steill & Co, now the second defenders, who were competent electrical contractors experienced in electrical installation and construction work, to disconnect the power supply to the area in which the pursuer was working. They made averments to the effect that this work had been done, and that certain checks had been carried out in November 1991 by way of confirmation.
[3] On 23 August 1996 the first defenders served a third party notice upon E J Stiell & Co. Sundry procedure took place between then and 18 June 2001 when the pursuer, in the course of adjusting a minute of amendment, sought to design the third party as second defenders. The case proceeded to proof in September 2002. Evidence was led over a period of six days at that stage. A further diet commenced on 18 August 2003. On the following day the pursuer abandoned the action, apparently on the view that he was unlikely to prove that there was any electricity in that part of the building where he was working.
[4] There followed, on 28 August, 4 September and 8 December 2003 further diets at which questions of expenses involving the pursuer, both defenders and the Scottish Legal Aid Board were extensively debated. The sheriff issued Notes on 30 September, 2003 and 20 January 2004. In the interlocutor which the latter Note accompanied he found the pursuer liable as an assisted person to the defenders in the expenses of the action; modified that liability to nil; and found the first defenders liable to the second defenders in expenses for the period from 23 August 1996 to 18 June 2001 (being the period before the case against them was adopted by the pursuer). This later finding was based on a concession by the first defenders' counsel.
[5] The present appeal is taken by the second defenders against the failure of the sheriff to award expenses in their favour against the first defenders from the periods subsequent to 18 June 2001. They contend that this liability should have devolved upon the pursuer and first defenders jointly and severally, which failing the first defenders should be found liable in a fixed proportion of such expenses such as 50%. The justification for this part of his decision is to be found in a short paragraph on p 8 of the Sheriff's Note. He stated:
"It seems to me that once the pursuer had decided to join the then third party as the second defenders it would make little difference what the first defenders did from then on. Even if the first defenders had discontinued an allegation of blame against the second defenders it would not necessarily follow that the pursuer would do so. Furthermore, it is clear that on the evidence (such as it was) the main allegation of fault was directed towards the second defenders, however, misconceived that allegation might be. I do not think that having regard to the circumstances of the case that it would be a just result to find the first defenders liable to the second defenders in the expenses beyond the period during which the second defenders were a third party".
[6] There are four grounds of appeal which senior counsel for the second defenders developed at the hearing. In summary these are:
(i) that there was no need for the second defenders to have been involved in the action at all. The contract between the defenders contained an indemnity clause in terms of which the second defenders as sub-contractors were bound to indemnify the first defenders against claims for injury caused by the sub-contract works. If the pursuer had succeeded in establishing that there was live electricity in the building where the accident occurred and in consequence had succeeded against the first defenders they could have recovered from the second defenders, if necessary in a subsequent action. The sheriff, it was contended, had failed to take this into account.
(ii) The sheriff had erred in failing to take into account a submission that the act of the pursuer in adopting the case against the second defenders did not change the underlying liability of the first defenders. The pursuer had a statutory case against the first defenders based on the Electricity at Work Regulations 1989. If he had established that he was electrocuted for any reason the first defenders would be liable on that statutory case. It was conceivable that, if the pursuer was electrocuted by a 'rogue' circuit, both defenders might avoid liability at common law. If he was electrocuted, the first defenders could not avoid statutory liability. There was, however, no basis on which the second defenders alone could be liable. Despite that the first defenders had maintained a separate plea in law attributing liability to the second defenders on the basis of negligence and breach of contract. The sheriff had failed to have regard to this, or to the fact that in May 2002 the second defenders intimated to the first defenders that in the event of a successful defence they would seek recovery of their expenses from the first defenders.
(iii) The sheriff erred in holding that once the pursuer had decided to adopt the case against the second defenders it would have made little difference what the first defenders did from then on. His comment that: 'Even if the first defenders had discontinued an allegation of blame against the second defenders it would not necessarily follow that the pursuer would do so'. That, it was said, was speculation.
(iv) In any event the sheriff had failed to give adequate reasons for his decision. When he said:
'I do not think that having regard to the circumstances of the case that it would be a just result to find the first defenders liable to the second defenders in the expenses beyond the period during which the second defenders were a third party'
It was wholly unclear what these 'circumstances' were".
[7] At the outset of his submissions counsel for the second defenders acknowledged the reluctance of an appellate court to interfere with a decision on expenses unless there had been an obvious miscarriage of justice (Caldwell v Dykes, 1906 6 F 839 at 840). He observed, however, that in the present case the expenses of each of the defenders came to more than £100,000 and in consequence there was a major issue involved even if that amount was less than the whole sum at stake in the action itself. This was not a case in which the cost of an appeal was out of all proportion to the amount involved (see Aird v School Board of Tarbert, 1907 SC 22 Lord Kinnear at 24). Moreover, the court was now prepared to examine the exercise of a discretionary power on a wider basis than it had been in the past. In Ramm v Lothian & Borders Fire Board, 1994 SC 226 the court entertained an argument that in dealing with expenses the Lord Ordinary had left material matters out of account in addition to the submission that his decision was plainly wrong.
[8] Having developed his submissions in support of the grounds of appeal as outlined above counsel for the second defenders indicated that his fundamental position, as presented to the sheriff in submissions, was that the underlying principle was that a defender who brings a third party into proceedings is prima facie liable for that party's expenses in the event of him being absolved. The act of the pursuer in adopting the case against a party so brought in should not change that underlying liability. In support of his submission he cited Brownlie v Tennant & Co, 1855 17 D 422. That was an action of damages for personal injuries in which the defenders, Tennant & Co pleaded that they were not liable for the injury sustained by the pursuer on the basis that the work in the course of which the accident happened was performed by an independent contractor, Gardner. A supplementary action was raised by the pursuer against Gardner. At the trial both Tennant & Co and Gardner were absolved, part of the evidence led disclosing that Gardner was in fact the defender's servant. As the pursuer was unable to pay expenses an issue arose between Tennant & Co and Gardner as to whether the former should be liable for the expenses of the latter on the basis that it was their unfounded averments which caused the supplementary action to be raised. Counsel founded on certain passages in the Opinion of the Lord Justice-Clerk (at p 425), in particular where it is stated:
"The principle of giving expenses to one defender against another is that every litigant is subject to the power of the court in regard to expenses, if by his conduct and acts in the litigation he has occasioned such expenses unnecessarily".
In Morrison v Waters & Co, 1906 8 F 867 the pursuer's son was run over and killed by an wagon driven by a pair of horses. The pursuer intimated a claim against Waters & Co who were the owners of the horses and the employers of the driver of the wagon. They denied liability alleging that another party was the owner of the wagon and that he had control of the driver. The pursuer proceeded to raise an action of damages against both parties jointly and severally but succeeded only against Waters & Co on the ground that the accident was due to the negligence of the driver who was their servant. It was held that Waters & Co were responsible for bringing the second defender into court and were liable in his expenses. The Lord President indicated in his opinion that the rule in such cases depended on the question "through whose fault was it that the additional defender was brought into court?" That was applied in McRae v Bryson, 1923 SC 896, a road accident case in which the defenders blamed each other for the accident. The unsuccessful defender was found liable for the successful defender's expenses. Counsel posed the question "through whose fault was it that the second defenders were brought into the present action?" The plain answer was that they had been brought in by the first defenders in a situation where this was unnecessary. If the fact that the pursuer had adopted the case against them was to any extent material they should still be found liable in a proportion of the second defenders' expenses from 18 June 2001 on.
[9] Counsel for the first defenders contended that the cases of Morrison v Waters & Co and McRae v Bryson were of a completely different character. These were both cases where the parties had blamed each other. The necessary implication was that the party who was unsuccessful had made an allegation which was false. There was no question of such falsity in the present situation. The pursuer's case depended on establishing that he suffered an electric shock. Both defenders denied that there was any electricity in the building which could have caused that event to occur. Whilst the first defenders' position was that there was no electricity which could have caused a shock their position had to be that if the pursuer was right in his account of the accident the presence of electricity was caused by the fault of the second defenders. The first defenders were accordingly justified in bringing in the second defenders. As matters transpired both defenders were blameless. The authorities did not support the view that a blameless defender who pointed to potential liability on the part of another should be liable in his expenses. Counsel founded strongly on Brownlie v Tennant & Co. The defender Gardner who had been brought in because of the position taken by Tennant & Co was not found entitled to his expenses from them. Unlike the present case where it might be said that there was potential liability on the part of the second defenders if the pursuer was right, no proper basis for the case against Gardner ever existed. In addition the pursuer's solicitor had made an offer to withdraw the case against Gardner which Tennant & Co had rejected. That made the situation stronger than the present. It was to be noted that Lord Murray had observed in Brownlie that "the power to award expenses is the due corrective of improper conduct in litigations and particularly of reckless misstatements of fact". Lord Wood spoke of the need to exercise "great caution" before awarding expenses in a situation of this type, and had observed that the court would only do so if the "grounds are made very clear indeed." There was no question of improper conduct or recklessness.
[10] The starting position, maintained counsel, was that the pursuer was liable for the expenses of both defenders. If it was the case that he was unable to pay, the court would attempt to deal with the issue between the defenders on principles of "substantial equity and justice". The consideration that it would be very hard on an innocent party to be found liable in expenses applied to both defenders. The true answer to the question of who was responsible for the presence of the second defenders in the action was that it was the pursuer. Before the sheriff counsel for the second defenders had contended that the pursuer was encouraged by the first defenders to join his clients as a defender. That argument was unfounded and rightly rejected by the sheriff. As the sheriff had indicated the essential issue in the case was whether there was electricity in the building. The second defenders were the party who were in the proper position to say whether this was so. Having regard to these considerations it was impossible to say that no reasonable sheriff would have failed to award the second defenders their full expenses against the first defenders or that a miscarriage of justice had occurred.
DECISION
[11] The starting point is to determine whether there is a normal rule or governing principle which applies in the present situation. That rule I take to be the one stated most clearly by Lord President Dunedin in Morrison v Waters & Co - that is it is a rule which depends on the question "through whose fault was it that the additional defender was brought into court?" I detect an implied acceptance of the applicability of that rule both in the first defenders' concession of expenses up to 18 June 2001, and in the submissions of their counsel when he sought to direct responsibility for bringing in the second defenders to the pursuer. In arriving at an answer to the question one requires, in my judgement, to look quite closely at the mechanism by which the additional defender was brought in, not merely the general background. In Brownlie v Tennant it is clear that Gardner was not called as a defender at the insistence of Tennant & Co - the Lord Justice-Clerk stated that at p 426 and also stated categorically (at p425) that "they did not...desire that Gardner should be called. If they had I think that would have at once subjected them" (my emphasis). In the light of that I consider that the case of Brownlie is rather more supportive of the second defenders' position than counsel for the first defenders sought to make out. Whilst cases such as Brownlie must always be examined with regard to the fact that they did not involve third party procedure the general principle that responsibility for the expenses of a party who is brought into a case unnecessarily seems to me to be a sound one. Application of that principle does not depend on the party being otherwise blameless in the litigation.
[12] It does not appear to me, in his approach to the question of expenses between the defenders, that the sheriff applied the above rule, although in fairness, standing the concession by the first defenders, he was led away from the question of why the second defenders were ever in the case. The sheriff's decision not to award expenses to the second defenders subsequent to 18 June 2001 appears to have been based on two grounds. The first is that it would have been made little difference what the first defenders did from the point when the pursuer adopted the case against the second defenders. I do not with respect follow the relevance of that. The essential question, accepting that the first defenders were responsible for the second defenders' expenses initially, was whether the adoption of the case by the pursuer somehow relieved them of further liability. I find it very hard to see why it should.
[13] The second reason appears to be that the "main allegation of fault was directed towards the second defenders". On a broad view I can see that the whole essence of this litigation centred on whether the second defenders had fulfilled their contractual obligation to disconnect the wiring from the part of the building in which the pursuer was working. I take that to be what the sheriff meant when he referred to the "circumstances of the case" and I consider that counsel for the second defenders was somewhat harsh in his criticism of that comment. Be that as it may, and whilst I can see that there might have been some practical advantages in the involvement of the second defenders as a party to the action, this does not address the legal justification for their presence. The pursuer had chosen to direct his claim against the first defenders, and if he had succeeded in establishing that he was electrocuted it is difficult to see how he could have failed against the first defenders. Possessed of the conviction that there was no electricity in the building and that the accident as averred by the pursuer was an impossibility, the only justification for the first defenders bringing the second defenders into the action was to protect themselves should it be established that the second defenders had failed in their contractual duties to disconnect the electricity.
[14] That was an eventuality against which the first defenders were protected by the contractual indemnity clause. The existence of that separate right to recover is an important and distinctive feature of this case, and indeed constitutes a material matter which the sheriff does not appear to have taken into account. Not only was not it strictly necessary for the first defenders to bring in the second defenders for the conduct of their defence based as it was on a contention that the accident was impossible, but it was unnecessary in the legal sense because the right of indemnity remained. In these circumstances I am quite satisfied that the sheriff's judgment, albeit a matter of discretion, should not stand. It did not take into account a material fact and arrived in my view at a decision which was plainly wrong. I do not see that there was any need for the second defenders to have been brought into this action as a separate party. That was a procedural step taken by the first defenders. By contrast to the sheriff I take the view that once they had brought the second defenders in it did not make a great deal of difference whether the pursuer adopted the case against them or not. In my view it is in accordance with principle that the first defenders should be found liable in the second defenders' expenses.