SHERIFFDOM OF GRAMPIAN HIGHLAND AND ISLANDS
AT KIRKWALL
A59/04
JUDGEMENT
of
SHERIFF
PRINCIPAL SIR STEPHEN S T YOUNG Bt QC
in the cause
MESSRS E R EUNSON & PARTNERS, EDWARD
ROBERT EUNSON, LILY ISABELLA EUNSON and BRIAN EUNSON
Pursuers and Respondents
against
MESSRS J & M FOUBISTER, JAMES
FOUBISTER and
MOIRA ANN FOUBISTER
First Defenders and Appellants
SIDNEY DAVID EUNSON
Second Defender
and
COLIN BICHAN WYLIE
Third Defender
|
Act:
Mr Andrew A Murchison, solicitor, Inverness
Alt:
Ms Georgette Herd, solicitor, Kirkwall
Kirkwall: 7th
November 2006
The
sheriff principal, having resumed consideration of the cause, refuses the
appeal and adheres to the interlocutor of the sheriff dated 30 June 2006 subject to
the following qualifications:
(i)
in part (4) delete the words "motion, no. 7.2 of
process" and substitute therefor "motion to allow the record to be opened up
and amended in terms of the first defenders' minute of amendment, no. 19 of
process, the pursuers' answers thereto, no. 20 of process, and the second and
third defenders' answers thereto, no. 25 of process";
(ii)
in part (5) add at the end the words "refuses to allow
these adjustments";
(iii)
with reference to part (8), the hearing previously
fixed by the sheriff to take place on 5
September 2006 should now take place on a date to be afterwards
fixed by him; and
(iv)
in part (9) delete the word "refusing", substitute
therefor the words "refuses in hoc statu"
and insert after the word "commissioner" the word "and";
finds
the first defenders and appellants liable to the pursuers and respondents in
the expenses of the appeal and allows an account thereof to be given in and
remits the same, when lodged, 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 parties were formerly
partners in a partnership based at Deerness, Orkney, and known as the Deerness
(Orkney) Machinery Group. In terms of
crave 1 the pursuers craved the court to find and declare that by letter dated 18 September 2002 notice had been
given on behalf of the pursuers to the defenders to terminate the partnership
and that as a result it had been dissolved with effect from 31 December 2002. In terms of crave 2 the pursuers craved the
court (a) to ordain the defenders to produce a full account of their
intromissions with the property of the former partnership and to grant decree
for payment by the defenders, jointly and severally, to the pursuers of the
balance found due with interest from 31 December 2002 until payment, failing
which (b) to grant decree for payment by the defenders, jointly and severally,
to the pursuers of the sum of £15,000 with interest from 31 December 2002 until
payment.
[2] The action was originally raised on 25 June 2004. At that stage the defenders were all
represented by the same solicitor. In
due course defences were lodged on their behalf. These incorporated a counterclaim in terms of
which they craved the court (1) to ordain the pursuers to produce a full
account of their intromissions with the bank accounts, financial accounts and
any other property of the partnership and to grant decree for payment by the
pursuers, jointly and severally, to the defenders of the balance now due
together with interest from 31 December 2002 until payment, failing which (2)
to grant decree for payment by the pursuers, jointly and severally, to the
defenders of the sum of £10,000 together with interest from 31 December 2002
until payment. The statement of facts in
support of this counterclaim is notable for its brevity. It contains four paragraphs. Paragraphs 1 and 2 are purely formal and
paragraphs 3 and 4 incorporate brevitatis
causa the averments in answers 5 and 6 in the defences respectively.
[3] Answer 5 is in the following terms (the
third pursuer is evidently meant to refer to Brian Eunson):
Denied. Explained and averred that the parties
entered into the Partnership Agreement.
This led them to acquire machinery over a period of years. Each piece of machinery was acquired in
different percentage shares. The parties
are all fully aware of the percentage shares and the individual items of
machinery in which they share. Further
explained and averred that during the course of the partnership the Pursuers
and in particular the Third Pursuer was responsible for the book keeping for
the group. The Third Pursuer held and to
the knowledge of the Defenders continues to hold at the time of lodging these
Defences all bank account, bank statements, bank books. Receipts, payments
sales and purchase ledgers and accounts in connection with the financial
operation of the group. The First,
Second and Third Defenders have called upon the Pursuers on a number of
occasions to produce these documents to them in an attempt to negotiate a
settlement. The Pursuers have failed to
do so. Further explained and averred
that the Third Pursuer chose to withdraw from the Group. He sought no
consultation with the First, Second and Third Defenders. The First, Second and Third Defenders call
upon him to lodge the Sales and Purchase Ledger in respect of the operation of
the group; the Bank Accounts at the Clydesdale Bank; the Value Added Tax Returns
to the Inland Revenue which have been completed by the Third Pursuer; copies of
all accounts and details of his intromissions with the accounts of the Deerness
(Orkney) Machinery Group so that a final accounting may be produced. His failure to do so will be founded
upon. Quoad ultra denied.
[4] Answer 6 is in the following terms:-
Denied. The Defenders having called upon the Pursuer
to produce the Purchase and Sales ledgers, details of the final accounts and
other accounting, and the Third Pursuer having attended to the book keeping of
the group and having failed to produce said accounting this action is
accordingly premature.
[5] The parties tabled a variety of preliminary pleas both in the
principal action and in the counterclaim with the result that at the continued
options hearing on 5 April 2005
the sheriff closed the record and assigned 3 May 2005 as a diet of debate.
[6] On 3 May 2005 the sheriff on the motion of the defenders,
there being no objection, discharged the diet of debate and on the motion of
the pursuers, there being no objection, (a) found and declared that by letter
dated 18 September 2002 notice was given on behalf of the pursuers to the
defenders to terminate the partnership and that as a result it had been
dissolved with effect from 31 December 2002, and (b) ordained the defenders to
produce a full account of their intromissions with the property of the former
partnership. No date was set by the
sheriff by which this account was to be produced, but instead on joint motion
he sisted the cause "to allow parties to seek assistance from a qualified
accountant to produce advice in relation to the said account". It is important
to notice here that there was no objection to the order upon the defenders to
produce an account.
[7] On 22 September
2005 the sheriff recalled the sist and assigned 18 October 2005 as a procedural hearing.
[8] On 18 October 2005
it was intimated to the court that the solicitor who had previously acted for
all the defenders no longer acted for the second and third defenders and the
sheriff therefore made the usual order for intimation to these defenders. He refused a motion by the pursuers for
decree in terms of crave 2(b) in the principal action and ordained the first
defenders to produce a full account of their intromissions with the property of
the former partnership within twenty eight days. He continued the cause for a further
procedural hearing on 15 November
2005.
[9] On 15 November 2005
the sheriff continued the cause to the procedural roll on 10 January 2006 "to allow the agent for the (second
and third) defenders to consider the papers and respond as appropriate and to
allow the pursuers and the first defenders to resolve issues in relation to
books of account". Since then the second
and third defenders have been separately represented from the first defenders,
and they have played no part in this appeal.
[10] The case was duly called before the
sheriff on 10 January 2006. It might have been thought that some time
before that date an account would have been lodged by the first defenders as
they had been ordered to do by the sheriff on 18 October 2005 (and previously
on 3 May 2005), marked up in the inventory of process in the process folder and
given a number of process. But there is
no sign in the process of any of these things having been done. In spite of this at the conclusion of the
hearing on 10 January 2006
the sheriff pronounced an interlocutor in the following terms:
The Sheriff, On Pursuers'
motion, Allows 6 weeks for the Pursuers and 2nd and 3rd named Defenders to
lodge a note of objection to the account produced by the 1st Defenders if so
advised; Allows 3 weeks thereafter for the 1st 2nd and 3rd Defenders to lodge answers thereto, if so
advised, and Continues the cause to the Procedural Roll of 21 March 2006 at
10.00 am. Meantime refuses the 1st
Defenders Motion to appoint a commissioner anent the specification
granted on 3 May 2005.
[11] When I enquired at the hearing of the
appeal where the account lodged by the first defenders was to be found, it was
suggested that it formed part of what has been described as the first
defenders' first inventory in the accounting.
This is marked no. 6/3 of process and was lodged only on 23 May 2006. It contains certain account statements and an
invoice book, but there is nothing at all that appears to me to satisfy the
terms of the orders which had been made to produce an account on 3 May 2005 and again on 18 October 2005. So it is still not clear to me what the first
defenders have done to implement the terms of these orders. But they must have produced something at
least to the pursuers and the second and third defenders since no. 18 of
process is a note of objections for the pursuers which was lodged on 21
February 2006 and no. 26 of process is a note of objections for the second and
third defenders which was lodged on 24 May 2006. Both these documents refer to the accounting
produced by the first defenders. So far
as I can discover from the process, no answers have ever been lodged by the
first defenders to these notes of objection notwithstanding the terms of the
sheriff's interlocutor dated 10 January 2006.
But there is a document which is described as a note of objection for
the first defenders which was lodged on 23 May 2006 and which forms no. 23 of
process. Quite what the purpose of this
document is I am not sure. It may be
that it was intended to form the first defenders' answers to the note of
objections for the pursuers since paragraphs 5, 6 and 7 and the fifth
plea-in-law refer to the pursuers' note of objections. But paragraphs 1, 2, 3, 4 and 8 and the first
and third pleas-in-law all bear to be objections to accounts of the partnership
for the years from 31 May 1989 to 31 May 2002 and also to 31 December 2002
which were lodged by the pursuers on 21 February 2006 and which now form no.
5/4 of process.
[12] On 21 March 2006 the sheriff after hearing
parties pronounced an interlocutor in the following terms:
The Sheriff, having heard
parties on the 2nd & 3rd Defenders Motion to Sist in respect of them,
Refuses same meantime; on the 1st Defender's motion, for the 2nd & 3rd
Defender to lodge accounts refuses the motion Meantime; on 1st Defenders motion
Allows 14 days for a Minute of amendment to be lodged , Allows 28 days for
Answers thereto and a further 21 days for adjustment if so advised, Allows
adjustment of the accounts and the objection until 23 May 2006 and Continues
the cause to the procedure Roll of 30 May 2006 at 10.00am.
I confess that I do not
understand what is meant by the reference to allowing "adjustment of the
accounts and the objection". If the case
had followed the usual procedure (as to which see Macphail's Sheriff Court
Practice (2nd Edn) at paragraph 21.09), it might have been expected
that by this stage in the proceedings the first defenders would have lodged
their account, the pursuers and the second and third defenders their notes of
objection and the first defenders their answers thereto so that the period of
adjustment allowed by the sheriff on 21 March 2006 would have been for the
purpose of allowing parties to adjust, not the account lodged by the first
defenders, but the notes of objection and answers thereto.
[13] In the event the first defenders did not
lodge a minute of amendment until 11 April 2006. On the same day they enrolled a motion, no.
7/2 of process, to allow this minute of amendment to be received although
late. No opposition to this motion was
lodged and accordingly on 19 April 2006 an honorary sheriff granted the motion
and allowed the minute of amendment to be received although late and to form
no. 19 of process. The pursuers' answers
to this minute of amendment were lodged on 9 May 2006 and form no. 20 of
process, while the answers for the second and third defenders to the minute of
amendment were lodged on 24 May 2006 and form no. 25 of process.
[14] The next step in the procedure was a
hearing which took place over two days, namely 30 May and 30 June 2006. At the conclusion of this hearing the sheriff
pronounced an interlocutor in the following terms:
The
Sheriff:
1)
having heard parties on the 1st Defenders motion made at the bar to appoint a
Commissioner in respect of the Specification of documents for the defender, no.
13 of process, for the recovery of the books, documents and others set forth in
said specification approved by interlocutor dated 5 April 2005, the Pursuers
objecting thereto as unnecessary; Grants same and grants commission to Alistair
Bruce, Solicitor, Lows, 5 Broad Street, Kirkwall, Orkney, to take the evidence
of witnesses and havers and to receive these said items and to report;
2)
3) having heard parties on
the 1st defenders Motion made at the bar to Ordain the Pursuers, in terms of
Crave 1 of their counterclaim, to account for the intromissions in respect of
the Partnership, Refuses same in hoc statu;
4)
having heard parties on the 1st defenders motion, no.7.2 of process, the Pursuers
objecting
thereto, Refuses same;
5) having heard parties on the 1st defenders Motion made
at the bar Pursuers objecting thereto, to adjust the Minute of Amendment no.19
of process, in terms of Rule 18 (5), by deleting
a. on page 5 in the 2nd
paragraph in answer 5 the words "and the provision of an action for
accounting no longer apply";
b. on page 5 in answer 6,
the 2nd sentence in its entirety that is the words "The remainder of the
Pursuers action is wrongly founded"; and
c.
the esto case in that article, that is from the word "Esto" on the 5th
line of article 3 on page 5 to the
end of that article (on page 6);
6) on Pursuers Motion,
Allows the defenders' counterclaim to be sisted;
7) on the 2nd & 3rd
defenders Motion to sist the cause in respect of them, Refuses same;
8)
on the motion of the pursuer and the 1st defender allows all parties a further
8 weeks for adjustment of the objections to the account and answers thereto;
continues the cause to the Procedural roll of the 5th September 2006 at 10.30am
to hear submissions from parties as to the next step in procedure; and Ordains
the Pursuer to produce a record of those accounts, objections and answers as adjusted
and to lodge that in court 2 days prior to that date;
9) on Pursuers Motion
finds the 1st Defenders liable to the Pursuers in the expenses of the amendment
procedure and refusing the 1st
defenders' motion to award expenses in respect of the appointment of a
commissioner reserves the question of those expenses meantime;
10)
having heard parties on the 1st Defenders Motion for
leave to appeal this interlocutor, the pursuer and 2nd and 3rd defenders
objecting, Grants same.
It is this interlocutor which is the subject of the
present appeal. For the avoidance of
doubt, I should record that the interlocutor has been typed out here as it
appears on the interlocutor sheets signed by the sheriff.
[15] On 7 July 2006 a note of appeal (no. 27 of
process) was lodged on behalf of the first defenders. It contains four grounds of appeal, but at
the hearing of the appeal itself the first defenders' solicitor indicated that
she no longer insisted on the first and second of these grounds. But she did insist on the third and fourth
grounds of appeal which are in the following terms:
3. The Sheriff erred in law in failing to allow the first
defender to amend in terms of Minute of Amendment no.19 of process. The
Proposed amendment is necessary to determine the issues between the parties.
4.
The Sheriff erred in law in failing to allow the First Defender's to adjust
their minute of amendment. The
adjustment would have effectively dealt with the objection of the Pursuers. He
should have allowed the adjustment and amendment to allow the pleadings to
correctly reflect the issues between the parties.
[16] With reference to the third ground of
appeal, it was not disputed at the appeal that part (4) of the sheriff's
interlocutor dated 30 June 2006 was incorrect.
In the first place, it was not open to the sheriff to refuse the first
defenders' motion, no. 7/2 of process, when this had previously been granted by
another sheriff on 19 April 2006. In any
event, this motion was simply to allow the first defenders' minute of amendment
to be received although late. The motion
which it was agreed had been canvassed before the sheriff on 30 May and 30 June
2006 was that the record should be opened up and amended in terms of this
minute of amendment and the answers thereto, and it was accepted that the
sheriff had refused to allow this. For
the first defenders it was maintained that the sheriff had erred in reaching
this decision, and the question whether or not he had so erred was the
principal issue debated at the appeal.
The sheriff dealt with this issue in paragraphs 6 to 12 of the very
thorough note which he prepared following the lodging of the note of appeal,
and it is unnecessary that I should repeat at length what he said in those
paragraphs.
[17] It may be helpful at this point to be
reminded of the provisions of rule 18.2 of the Ordinary Cause Rules as they
applied to this particular issue.
Paragraph (1) of rule 18.2 provides that the sheriff may, at any time
before final judgement, allow an amendment mentioned in paragraph (2). Paragraph (2) describes a variety of
different amendments including "(c) an amendment of a condescendence, defences,
answers, pleas-in-law or other pleadings which may be necessary for determining
the real question in controversy between the parties". There is a helpful discussion of Chapter 18
of the Ordinary Cause Rules at pages D44/62/1-6 of the Parliament House Book
and, as indicated at page D44/62/2, where an amendment of the type proposed in
sub-paragraph (c) is proposed the sheriff in deciding whether or not to grant
the motion to give effect to such an amendment has to proceed in two
stages. In the first place he has to
consider whether or not the minute of amendment is necessary for determining
the real question in controversy between the parties and, if he is satisfied of
this, he has to decide whether or not in the exercise of his discretion he
should allow amendment in terms of the minute of amendment.
[18] On 23 May 2006 there was lodged on behalf
of the first defenders a copy of their minute of amendment which incorporated
certain adjustments. This copy is no. 24
of process, and it was this version of the minute of amendment which was before
the sheriff at the hearings on 30 May and 30 June 2006. It is important to notice that in terms of it
the first defenders did not seek to amend the only pleadings which they have
lodged which bear to have anything to do with the accounting procedure, namely
their note of objections, no. 23 of process.
(Indeed, as will be recalled, this was only lodged on 23 May 2006
exactly six weeks after the minute of amendment in its original form had been
lodged). On the contrary, the minute of
amendment as adjusted sought only to amend the answers in the principal action,
and in particular answers 5 and 6 which had been incorporated brevitatis causa in paragraphs 3 and 4
in the statement of facts annexed to the counterclaim. It follows that, in determining whether or
not the amendment was necessary for determining the real question in
controversy between the parties, the sheriff had to consider, not what was the
real question in controversy between the parties in the accounting procedure,
but what were the real questions in controversy between the parties in the
principal action and in the counterclaim.
[19] In terms of the principal action there
were originally two such questions, namely (1) whether or not the partnership
among the parties had been dissolved with effect from 31 December 2002 as a
result of the sending of the letter dated 18 September 2002, and (2) whether or
not the defenders were liable to produce a full account of their intromissions
with the property of the partnership. As
already noted, both these questions had been determined in favour of the pursuers
on 3 May 2005 when the sheriff on their motion, there being no objection, had
granted declarator in terms of crave 1 and had ordained the defenders to
produce a full account of their intromissions with the property of the
partnership in terms of crave 2(a). This
did not mean that the pleadings in the principal action had altogether served
their purpose since there remained the second part of crave 2(a) in terms of
which the pursuers sought decree for payment by the defenders, jointly and
severally, of the balance found due to them in the account to be produced by
the defenders. Plainly the amount of
this balance, if any, is still a question in controversy between the
parties. But it is a question to be
resolved, not in the context of the principal action, but in the context of the
accounting procedure, the pleadings in which, as noted, were not sought to be
amended by the first defenders.
[20] The real question in controversy between
the parties in the context of the counterclaim is whether or not the pursuers
are liable to account to the defenders in terms of crave 1 in the
counterclaim. This question remains a
live one and in my opinion it was this question alone which the sheriff had to
consider when determining whether or not the first defenders' minute of
amendment as adjusted was necessary for determining the real question in
controversy between the parties.
[21] In the minute of amendment as adjusted
there are three short passages which indicate that the first defenders are not
liable to account to the pursuers at all.
At the hearing before the sheriff the first defenders' solicitor moved
him to allow the minute of amendment to be further adjusted to delete these
three passages. The sheriff refused to
do this (see part (5) of his interlocutor dated 30 June 2006) and at the appeal
the first defenders' solicitor submitted that the sheriff had erred in this
respect. She further explained that,
following the closing of the record, it had come to light that books and
accounts of the partnership were in the hands of the pursuers and that
machinery belonging to the partnership had been stored in premises which were
jointly owned by the pursuers and the first defenders and to which the pursuers
had had regular access. She submitted
that the sheriff ought to have allowed amendment in terms of the whole of the
first defenders' minute of amendment as adjusted subject to the deletion of the
three short passages to which reference has just been made.
[22] It has to be said that a great deal of the
material in the minute of amendment as adjusted is such that it ought to find
its place, not in the first defenders' pleadings in the principal action and in
the counterclaim, but in their pleadings in the accounting procedure. Although her position on this was not
altogether clear, I think that by the conclusion of the hearing of the appeal
the first defenders' solicitor had come to accept this. But she did maintain that there were two
passages in particular in the minute of amendment as adjusted which were
relevant to the question whether or not the pursuers had a liability to account
to the first defenders in terms of the counterclaim.
[23] The first of these passages appears in the
minute of amendment as adjusted at the beginning of a lengthy insertion which
the first defenders sought to make in answer 5.
The passage reads as follows (I have corrected two obvious typographical
errors):
In particular it is denied that the first defenders have
retained the machinery. Explained and
averred that the assets being the machinery is stored at Little Millhouse,
Deerness. This property is held by the
partners and trustees of the firm of S E F Properties. The remaining partners and trustees of said
firm are Brian Eunson of the pursuers and James Foubister of the first
defenders. A copy of the disposition in
favour of S E F Properties is lodged herewith referred to for its terms and
incorporated herein brevitatis causa. Brian Eunson is fully aware of the
whereabouts of the machinery, he has access to same. His son Ian Eunson has had access to same and
has caused damage thereto. The said
premises are unlocked. The said Brian
Eunson has access to the said premises.
[24] The second passage appears as part of a
proposed new answer 6 which the first defenders seek to substitute for the
existing answer 6 (which is to be deleted accordingly). The passage reads (again I have corrected a
typographical error):
The pursuers have failed to yield up the necessary
information to provide an accounting.
Further explained and averred that the assets of the partnership have
remained available to the pursuers as hereinbefore condescended upon. The pursuers are entitled to realise those
assets. The assets being the machinery
are stored at Little Millhouse, Deerness.
This property is held by the partners and trustees of the firm of S E F
Properties. The remaining partners and
trustees of said firm are Brian Eunson of the pursuers and James Foubister of
the first defenders. The premises are
unlocked.
[25] At the end of the day, as I understood
her, the submission of the first defenders' solicitor was that amendment should
be allowed in terms of the minute of amendment as adjusted in its entirety
subject to deletion of the three short passages to which reference has already
been made, failing which amendment should at least be allowed in terms of the
two passages which I have quoted in full in the preceding two paragraphs.
[26] In response, the pursuers' solicitor
submitted that, before I could interfere with the sheriff's decision, I would
have to be satisfied that he had erred in law or exercised his discretion
wrongly in refusing to allow amendment in terms of the minute of amendment as
adjusted and the answers thereto. He
drew attention to the difficulties which would arise in practice if the
amendment were to be allowed given that in the closed record in its present
form the defences had been expressed to be on behalf of all the defenders
whereas in the minute of amendment as adjusted it was sought to amend certain
of the answers in the defences on behalf of the first defenders only. He submitted that the averments in the minute
of amendment as adjusted demonstrated a confusion between, on the one hand, the
issue of liability to account and, on the other, the issue of the extent of
that liability which fell to be addressed in the accounting procedure. He submitted too that the two passages quoted
in paragraphs [23] and [24] above did not assist towards establishing a
liability on the part of the pursuers to account to the first defenders and so
were irrelevant to this issue. And
finally, even if these passages were thought to be necessary for determining
the real question in controversy between the parties in the counterclaim, the
court should not allow amendment in terms thereof given in particular that the
order which had been made against the first defenders for production of an
account related to their intromissions with the whole of the property of
the partnership, that the probable result of the accounting procedure which had
now been embarked upon would be a clear set of balances due one way or another,
that in light of the pursuers' pleas to the relevancy and competency of the
counterclaim there was no likelihood of an early order being made against them
to produce an account of their intromissions, that to allow the counterclaim to
proceed at this stage would result in an unnecessary duplication of expense and
that in any event, in terms of part (6) of his interlocutor dated 30 June 2006,
the sheriff had allowed the counterclaim to be sisted and no appeal had been
taken against this part of the sheriff's decision. In all these circumstances the sheriff had
been right to exercise his discretion to refuse to allow amendment in terms of
the minute of amendment as adjusted and the answers thereto. Finally, the sheriff, so it was submitted,
was in any event right to have refused to allow further adjustment of the
minute of amendment in terms of the three short passages referred to in part
(5) of his interlocutor of 30 June 2006.
It was pointed out here in particular that these adjustments had only
been proposed on the second day of the hearing before the sheriff and no
satisfactory explanation had been afforded for this. The appeal should therefore be refused and
the interlocutor of the sheriff dated 30 June 2006 adhered to subject to
certain necessary minor qualifications being made to its terms to reflect what
had actually been decided by the sheriff in particular in parts (4), (5) and
(9) of the interlocutor and the fact that the date mentioned in part (8) had
now passed.
[27] In my opinion the submissions for the
pursuers are to be preferred. In crave 1
of the counterclaim the defenders seek to have the pursuers ordained to produce
a full account of their intromissions with the bank accounts, financial
accounts and any other property of the partnership. There are already averments about the
partnership bank accounts, financial statements and the like in the existing
answer 5 and it does not appear to me that anything in the two passages quoted
in paragraphs [23] and [24] above is of any relevance at all to the supposed
liability of the pursuers to account to the defenders for their intromissions
with the bank accounts and financial accounts of the partnership. As for the other property of the partnership
to which reference is made in crave 1 of the counterclaim, there are some brief
and distinctly vague references to machinery in the existing answer 5, and it
is true that the proposed addition to this answer quoted in paragraph [23]
above does refer to machinery. But it is
very difficult to see how this passage might be said to instruct a liability on
the part of the pursuers to account to the defenders for their intromissions
with this machinery. It is said that
this machinery is stored in property held by another partnership of which the
partners and trustees are one of the pursuers and one of the first
defenders. It is said too that this
pursuer is fully aware of the whereabouts of the machinery, that he has access
to it, that his son has had access to it and has damaged it and that the
premises are unlocked. It is not clear
why it ought to follow from these averments that the pursuers should account to
the defenders for their intromissions with the machinery, in particular when
consideration is given to the initial denial in this passage that the first
defenders have retained this machinery and the averments which follow which
suggest that the pursuers stand in exactly the same relationship to this
property as the first defenders.
Finally, there is the passage quoted in paragraph [24] above which is
intended to form part of the new answer 6 and which in my opinion adds nothing
of significance to the passage quoted in paragraph [23].
[28] Even if it had been the case that the
proposed amendments to answers 5 and 6 had been necessary for determining the
real question in controversy between the parties in the counterclaim, I think
that I should have hesitated long and hard before allowing amendment in terms
of these passages in light of the factors to which the pursuers' solicitor
referred as narrated in paragraph [26] above.
At all events I am quite satisfied that the sheriff was correct to
refuse to allow the record to be opened up and amended in terms of the first
defenders' minute of amendment as adjusted and the answers thereto, and I have
refused the appeal accordingly.
[29] In view of what I have already said, it is
unnecessary that I should express any opinion on whether or not the sheriff was
right to refuse to allow the first defenders' minute of amendment to be further
adjusted as outlined in part (5) of his interlocutor dated 30 June 2006.
[30] The pursuers' solicitor proposed that I
should find the first defenders liable to the pursuers in the expenses of the
appeal in the event that it was refused.
The first defenders' solicitor submitted that I should reserve the
question of expenses in the meantime.
For my part, I see no reason to depart from the normal practice that
expenses should follow success, and I have found the first defenders liable to
the pursuers in the expenses of the appeal accordingly.
[31] For the sake of completeness, I should
record that in the course of his submissions the pursuers' solicitor referred
me to Finnie v Finnie (Stonehaven, 3rd
December 2003, unreported).
