SHERIFFDOM OF SOUTH STRATHCLYDE DUMFRIES AND GALLOWAY

A1235/08

Act: G Cunninghame, Counsel, instructed by Mitchells Robertson, Glasgow

Alt: C Marney, Advocate, instructed by DLA Piper Scotland, Edinburgh

Airdrie: 4 March 2009

The Sheriff Principal, having heard counsel for parties refuses the appeal against the Sheriff's interlocutor of 17 November 2008 on the grounds that leave to appeal was not obtained from the Sheriff and is therefore incompetent; remits the cause to the Sheriff to proceed as accords; finds the defender and appellant liable to the pursuers and respondents in the expenses of the appeal; allows an account thereof to be given in and remits same when lodged to the Auditor of Court to tax and to report; certifies the appeal as suitable for the employment of counsel; grants leave to appeal to the Court of Session.

NOTE

1. This is an appeal against an interlocutor dated 17 November 2008 when recall of an interim interdict granted on 2 October 2008 was refused. Counsel for the pursuers and respondents (hereinafter referred to as "the pursuers") raised a preliminary issue as to the competency of the appeal on the grounds that the leave of the Sheriff to appeal to me had not been obtained. This motion was opposed by counsel for the defender and appellant (hereinafter referred to as "the defender"). I heard counsel on this preliminary issue before considering the grounds of appeal which had been lodged.

2. On 25 September 2008 the Sheriff, on the basis of ex parte statements on behalf of pursuers granted interim interdict pre-service and assigned a hearing on 2 October 2008. The Sheriff's interlocutor is in the following terms:

"... and as regards the interim orders craved, appoints parties or their agents to be heard thereon within the Sheriff Court House, Graham Street, Airdrie on 2 October 2008 at 10.00 am and appoints the pursuer to intimate the diet to the defender forthwith; meantime ad interim interdict the defender from either solely or jointly, with or as manager or agent or officer or employee for any person, firm or company from directly or indirectly using information confidential to the pursuers gained by virtue of the defender's employment with the pursuers for the purpose of obtaining, carrying on or being engaged or being interested in any business; said orders to continue until said diet."

3. On 2 October 2008 the Sheriff heard submissions from both parties and then continued the interim interdict previously granted, said order to continue until further orders of court. In my view the proper construction of that procedure is that the Sheriff was persuaded on 25 September 2008, on the basis of the ex parte statements made on behalf of the pursuers, to grant interim interdict until 2 October 2008 when a full hearing would take place. The grant of that interim interdict is properly described as an interim measure to preserve the status quo pending both parties making full submissions to the court - thus the use of the word "meantime" in the interlocutor. At the full hearing on 2 October 2008, the Sheriff would decide whether or not, on the basis of these full submissions, it was proper that interim interdict should be granted. If the Sheriff was persuaded that interim interdict should be granted, she would in fact continue the interim interdict which had been put in place until that date as a holding operation. If she was not so persuaded, she would refuse to grant interim interdict. It would be open to either party to appeal that decision without leave. The terms of section 27(a) of the Sheriff Courts (Scotland) Act 1907 would allow that procedure. That provision is in the following terms:

"27. Subject to the provisions of this Act an appeal to the Sheriff Principal shall be competent against all final judgments of the Sheriff and also against interlocutors-

(a) granting or refusing interdict, interim or final"

4. That interpretation of the position in my view is consistent with the decision of Sheriff Principal Nicolson in the case of ASA International Ltd v Nelson 1999 SLT (Sh Ct) 44. Sheriff Principal Nicolson recorded at 45:

"... on lodging their initial writ on 4 June 1998, the pursuers sought, and were granted, interim interdict in terms of the second crave in the writ. As is customary in sheriff court proceedings where no caveat is in existence, that order was pronounced in the absence of any appearance by or on behalf of the defender. However, as is also customary in such proceedings, the interlocutor of 4 June also appointed parties to be heard on the matter of interim interdict on 18 June 1998, ... for the reasons which are not disclosed in the interlocutor, the hearing was continued for just over a week until 26 June 1998. However, the interlocutor of 18 June also continued the interim interdict previously granted until that date. On 26 June 1998 the question of interim interdict appears to have been fully argued before the Sheriff and at the conclusion of the hearing she recalled the interdict granted in the interlocutor of 4 June ..."

Sheriff Principal Nicolson concluded at page 46:

"I have little difficulty in accepting the submission advanced by the solicitor advocate to the effect that, viewed realistically, what a Sheriff is doing at a second hearing under sheriff court practice, is effectively granting or refusing interdict after hearing full submissions on either side; and, if that is right, then of course an interlocutor pronounced at such a hearing is one which falls completely under the terms of section 27(a) of the 1907 Act, and so can be appealed without leave."

5. When the Sheriff continued the interim interdict on 2 October 2008 in this case, she did so "until further orders of court". A motion, no 7/1 of process was enrolled by the defender seeking recall of the interim interdict. The motion was in the following terms:

"Bradley for the defender moves the court to recall the interim interdict contained in the interlocutor dated 2 October 2008 in respect that (i) the pursuers have not made out a prima facie case and in any event (ii) the balance of convenience favours recall"

The Sheriff records in her note:

"On 17 November 2008 I heard both parties and considered that there was a change of circumstances which would enable the motion for recall of the interim interdict to be heard before the court in that the defender was no longer employed by the pursuers. I then heard the motion and refused it. It is against that interlocutor that the defender now appeals."

6. It appears to me that there is a substantial distinction between the hearing which took place on 2 October 2008 and the hearing which took place on 17 November 2008. On 2 October 2008 what the Sheriff was being asked to do was grant or refuse interim interdict after hearing full submissions from both sides for the first time. There had not been any hearing in which both parties had made submissions to the Sheriff prior to that date. As a holding measure, pending a full hearing and "meantime", the Sheriff granted interim interdict on 25 September 2008 pre-service until 2 October 2008 when both parties could be heard on the question of interim interdict.

7. The hearing on 17 November 2008 was at the instance of the defender in respect of his motion to recall the interdict contained in the interlocutor of 2 October 2008 (the date of the hearing - not the date of the pre-service application). It was said that there was a change of circumstances in that the defender was no longer employed by the pursuers and that in these circumstances the pursuers had not made out a prima facie case and in any event the balance of convenience favoured recall. In my opinion the Sheriff on 17 November 2008 was being asked to decide whether to recall the interim interdict granted on 2 October 2008 because of a change of circumstances. She was not being asked to grant or refuse an interim interdict. That decision had already been taken. Section 27(a) of the Sheriff Court (Scotland) Act 1907 only allows an appeal without leave against the grant or refusal of an interdict, interim or final. The Sheriff's interlocutor of 17 November 2008 does not fall into that category. The Sheriff refused the motion to recall the interim interdict granted on 2 October 2008. That decision is not among the list of decisions listed in section 27 of the 1907 Act where there can be an appeal to the Sheriff Principal without leave.

8. While it appears to me that the decision which I have given accords with the proper interpretation of the 1907 Act, I am fortified by the dicta in Macphail, Sheriff Court Practice to which I was referred. In the first edition published in 1988 at para 21-82:

"An interlocutor granting or refusing interim interdict may be appealed without leave to the Sheriff Principal or with leave to the Court of Session. An interlocutor reserving the question of interim interdict until defences are lodged or, it would appear, recalling or refusing to recall an interim interdict, may be appealed only with leave."

In the second edition of Macphail, edited by Sheriff Principal Nicolson and Sheriff Stewart, and published after the decision in ASA International Ltd supra, it is observed at para 21.93:

"... If an interim interdict has been granted only till the date of a hearing and at that hearing the interim interdict is "recalled" (which means in effect that it is not granted of new), the recall may be appealed against without leave of the sheriff on the basis that it is not truly a recall but rather a refusal. (The footnote is a reference to ASA International) ... However, if interim interdict has been granted "until further orders of court" and the sheriff is then made to recall it, his decision, whether to recall or to refuse to do so, is appealable only with leave. ..."

The footnote refers to the Rules of the Court of Session, Rule 38.3(4)(e) which provides specifically that leave is not required to reclaim against an interlocutor "granting, refuting, refusing or refusing to recall" interim interdict. For my part, I do not think it is necessary for me to draw any inferences as to the proper construction to be placed on statutory provisions applying to the Sheriff Court from words used in Rules applicable in the Court of Session. However, it is a matter of comment that the authors of the Court of Session Rules saw fit to specifically include recall procedure in respect of interim interdicts when listing matters where leave to appeal was not required to allow a party to reclaim. The clear inference is that, if recall procedure had not been so included, it would in fact have been excluded. Be that as it may, I respectfully agree with the observations contained in para 21.93 which I have set out above in Macphail second edition, which are repeated at para 21.93 in the third edition which was published in 2006.

9. Counsel for the defender referred me to page 46 of ASA International Ltd supra:

"I find some support for the foregoing view in a consideration of the purpose which is intended to be achieved by the restriction as to interlocutors appealable without leave set out in section 27. As is said in Macphail second edition para 18-31: "It is the policy of the 1907 Act to refuse appeals from the Sheriff Principal until final judgment, unless the interlocutor is one of material importance or one which would effect the status quo of parties, and not to permit other appeals unless the leave of the Sheriff is specially granted." The categories of interlocutors appealable without leave, as set out in the various paragraphs of section 27 of the 1907 Act, are all plainly ones which satisfy the requirement of being of material importance or being ones which would effect the status quo of parties; and viewed from that prospective I cannot see that an interlocutor pronounced at a second hearing of interim interdict proceedings, where there has been a full hearing on all the issues, is any less of that kind simply on the account of the fact that it may deal with the matter in issue by continuing or recalling an interdict already granted on ex parte representations rather than granting or refusing an interdict de novo"

In my opinion, that passage does not assist the defender. It does not in my opinion indicate that after interim interdict has been granted following a full hearing, at a subsequent hearing on a motion to recall the interim interdict on the ground of a change of circumstances, the decision made on that occasion can be construed as a grant or refusal of interim interdict. The decision in such a situation would either be the grant of the motion and the recall of the interim interdict, or the refusal of the motion and the continuation of the interim interdict already granted. In these circumstances the recall of the interim interdict is not, in terms of section 27(a) of the 1907 Act, the refusal of an interim interdict. Accordingly leave to appeal is required.

10. In light of my decision I take the view that this appeal is incompetent as leave has not been obtained from the Sheriff. I have awarded the expenses of the appeal to the pursuers. Both sides were represented by counsel. There appeared to be no direct authority on this point and in these circumstances I certified the appeal as suitable for the employment of counsel. On the same basis I granted the motion by the defender and appellant for leave to appeal to the Court of Session.