Scottish Sheriff Court Decisions

Sheriffdom of Lothian and Borders at Jedburgh

 

 

Judgement of Sheriff Alan D Miller   in the case of   Angela Lindsay   Pursuer   against   George Murphy   Defender   Court ref. no. AJ298/07

 

 

 

 

Representation

For the Pursuer: Ms Wild, Advocate instructed by Andrew Haddon and Crowe, Solicitors

For the Defender: Ms Loudon, Advocate, instructed by Bannerman Burke, Solicitors

 

 

Jedburgh, June 2010

 

FINDINGS

 

The Sheriff, having resumed consideration of the case together with the productions,

Finds in fact:

1.      The parties are designed in the instance. Both reside in or near Hawick. The pursuer works part-time as a financial controller and is 38 years old. The defender receives incapacity benefit and does not have paid employment.

2.      The parties are the co-proprietors of the house and ground known as The Curling House, Crowbyres, Hawick.

3.      The pursuer worked from when she left school until the birth of the parties' first child in July 1998. She worked for N Peal Cashmere Ltd from 1988 to 1998 and was twice promoted. She also had two part-time bar jobs and was an Avon representative for several years. By 1996, her total annual earnings were in the region of £20,000.

4.      In 1997 and for about 2 years thereafter, N Peal put their workforce onto a 3 day week.

5.      In 1991 or 1992, the pursuer and her mother Mrs Elaine Lindsay jointly purchased the local authority flat tenanted by Mrs Lindsay in Roberton Place, Hawick. The purchase was financed by a mortgage in respect of which Mrs Lindsay made the monthly repayments.

6.      During the mid-1990s, Mrs Lindsay moved out of the Roberton Place flat to stay with her new partner. The pursuer continued to reside there and took over responsibility for making the mortgage repayments.

7.      The parties commenced a relationship in about 1992. Their relationship became serious in about 1997. The defender spent increasing time at the Roberton Place flat.

8.      In or about 1993, the defender received an agreed sum of approximately £20,000 from his former wife following their divorce.

9.      The pursuer made various improvements to the flat in Roberton Place. The defender contributed to the cost of some improvements and assisted with the work. His contributions are reasonably assessed as having enhanced the market value of the flat by about £5,000.

10.  The pursuer gave birth to three children namely Keiran Murphy (born 14^th July 1998), Aidan Murphy (born 19^th April 2001) and Danica Murphy (born 12^th May 2005). All three children were accepted by the parties as children of the family.

11.  The parties began to cohabit full-time in October 2001.

12.  During the period of the cohabitation, neither of the parties undertook paid employment. They jointly received income support. The defender also received incapacity benefit in respect of a diagnosis of depression. These benefits, together with child benefit and child tax credit payments, were used primarily for family living expenses.

13.  In late 2002, the defender's brother Mr Mick Murphy agreed with a Mr and Mrs Johnson to purchase from them an area of land known as the Old Curling Pond, Crowbyres, Hawick. He paid £6,000 in cash; in exchange, Mr Johnson gave him the title deeds for the property. He planned to keep horses on the land.

14.  The parties became aware of Mick Murphy's interest in the land. The pursuer expressed a wish to build a house on the land. Mr Murphy did not believe the land was suitable for that purpose. The pursuer persisted, and he agreed to allow her to investigate the possibility of building a house on the land.

15.  The pursuer spoke with her mother about the land. Mrs Lindsay and her partner gave her £6,000 in cash in the expectation that the money would be used to purchase the land.

16.  In January 2003, the pursuer instructed an architect to prepare a deed plan in respect of the land as part of the boundary line was unclear. In April 2003, she entered into communications and discussions with Scottish Power and Scottish Water about the supply of services to the land. She entered into communications and discussions with Scottish Natural Heritage about conservation issues related to the land. In May 2003, she applied to the local authority for outline planning permission for erection of a dwelling house, and had a number of dealings with officials. Outline permission was granted in July 2003.

17.  The defender had only limited involvement in these discussions and no involvement in written communications.

18.  With outline planning permission, the value of the land in 2003 is reasonably estimated at £80,000.

19.  In July 2003, the pursuer engaged a drilling company to assess the land for drainage and foundation requirements.

20.  In November 2003, Mick Murphy sold the land to the parties for £6,000.

21.  The pursuer and her architect prepared a detailed plan of the proposed dwelling house, based around a timber-framed kit. In or about December 2003, she lodged an application for detailed planning consent. She engaged in lengthy communications and discussions with the local authority over issues relating to the proposed access road. She continued to plan and organise the provision of services to the land.

22.  In November 2003, the pursuer and Mrs Lindsay exchanged missives for the sale of the Roberton Place flat. The purchasers took entry in or about May 2004. Mrs Lindsay allowed the pursuer retain the whole of the free proceeds of sale, which amounted to £57,343.29.

23.  In May 2004, the pursuer obtained a quotation from a builder that the cost of building the house would be in the region of £215,000, excluding the garage, driveways and septic tank. The total cost of building by a contractor is reasonably estimated at £220,000.

24.  The local authority granted the pursuer full planning consent, and issued a building warrant in August 2004. The pursuer instructed the necessary structural design certificate. She organised work to commence on site with the laying of foundations for the house.

25.  The pursuer had intended to return to work, but then decided not to do so after she fell pregnant in August 2004. The defender would have been content for her to return to work and would have taken a greater role in child care if required.

26.  In or about January 2005 Mrs Lindsay offered the pursuer additional financial support towards the costs of building the house. In total she gave the pursuer about £29,500 for this purpose.

27.  Although the pursuer took the lead role in design and planning of the house, the parties discussed matters together. The pursuer selected most of the tradespersons who contributed to the work. Many were selected because they were friends of the defenders or of both parties, and were approached about the work by the defender.

28.  The defender offered practical assistance to most of the tradespersons who assisted in construction of the house. Many of the tradespersons carried out their work for reduced or no payment as they considered they were doing the work as a friend of the defender's or of both parties, or in recognition of the defender's assistance.

29.  The pursuer undertook most of the dealings with suppliers in respect of materials for the house. She regularly ordered and collected materials.

30.  Invoices totalling £85,233.40 in respect of work on and materials used for the design and construction of the house were paid out of the pursuer' bank account. The pursuer subsequently received a VAT repayment of £2,300 which related to these invoices.

31.  The defender paid for a septic tank for the property, for the tarring of the driveway and for some of the work carried out by tradespersons. The total value of these payments is reasonably assessed at £500.

32.  The parties continued to receive state benefits. As of April 2007, the defender was in receipt of benefits totalling £128.80 per week, of which £96.80 was income support for both parties and £36.00 was in respect of his incapacity for work. These sums were paid into his bank account, which was operated primarily by the pursuer, and were used primarily for family living expenses.

33.  The pursuer also received child benefit and child tax credit. As of 2007, she received child benefit of £40.85 per week. She was awarded child tax credit of £5,901.30 for the year 2006-2007. These sums were also used for family living expenses.

34.  The parties separated on 24^th September 2007. The pursuer and the children moved out of the house. The pursuer subsequently obtained rented accommodation in Hawick. The defender continues to reside in and to maintain the house.

35.  In November 2008 the parties, having taken separate and independent legal advice, signed a minute of agreement regulating the arrangements for sale of the property. They agreed that the property would be sold as soon as reasonably practicable, and that parties would consult each other on all steps required to effect a sale, neither party withholding acceptance of any reasonable offer for the property. They further agreed that the terms of the minute were irrevocable.

36.  The property was valued as at 1^st September 2008 at £350,000.

37.  The property went onto the market early in 2009. At the pursuer's request, offers over £400,000 were invited. There was little or no interest. In October 2009, the parties agreed to reduce the price to offers over £350,000. The property has remained on the market since then and has been viewed by at least 3 persons.

38.  The pursuer commenced a part-time job as a financial controller in January 2010, earning £130 net per week.

39.  Keiran and Aidan currently attend primary school, and Danica attends a pre-school facility. The children attend an after-school service on the days when the pursuer is working. The cost of full-day care during holidays, in-service days and public holidays is £15 per child per day. The cost of pre-school care for Danica is £45 per week until she starts school in August 2010.

40.  There are 12 weeks' school holidays and about 10 in-service days or public holidays each year.

41.  The parties have been engaged in separate court proceedings relating to the defender's contact with the children. Currently, there is no order of court regulating contact. The defender currently has contact with the children once every few weeks.

42.  The defender makes a very limited financial contribution towards the care of the children.

43.  Mrs Lindsay and her partner look after the children from time to time. The pursuer's new partner looked after the children on one occasion to allow the pursuer to attend a job interview. She had asked the defender to look after them on this occasion but he was unable to do so.

 

Finds in fact and law:

1.    Neither party is in breach of the minute of agreement signed in November 2008.

2.    Performance of the parties' obligations under the minute of agreement remains possible and has not been frustrated in law.

3.    The parties are cohabitants within the terms of the Family Law (Scotland) Act 2006, section 26.

4.    The children Keiran, Aidan and Danica Murphy are relevant children for the purposes of section 28 of the 2006 Act.

5.    The defender has derived economic advantage from contributions made by the pursuer to the extent of £39,750.

6.    The pursuer has suffered economic disadvantage in the interests of the defender and the children.

7.    The economic burden of caring, after the end of the cohabitation, for the children is reasonably assessed at £8,230.

Finds in law:

1.      The pursuer is barred by contract from the right to insist on division and sale.

 

Accordingly,

1.    sustains the pursuer's second and third pleas in law to that extent;

2.    sustains the defender's first plea in law;

3.    repels the pursuer's first plea in law and the defender's third plea in law;

4.    dismisses the defender's counterclaim for want of insistence;

5.    finds the pursuer entitled to payment by the defender of the sums of £39,750 and £8,230;

6.    fixes a hearing at Jedburgh Sheriff Court, at a date and time to be arranged, on the questions of the timing of payment, interest and expenses.

 

AUTHORITIES REFERRED TO

Burrows v Burrows 1996 SC 378

Campbell v Murray 1972 SC 310

F v D 2009 Fam LR 111

Gow v Grant (unreported), Edinburgh Sheriff Court, 7^th December 2009

Jamieson v Rodhouse 2009 Fam LR 34

M v S 2008 SLT 871

McBryde, The law of Contract in Scotland (3^rd edition, 2007)

Macphail, Sheriff Court Practice (2^nd edition, 1998)

The Miller Group Ltd v Tasker 1993 SLT 207

Morrison v Kirk 1912 SC 44

Thomson, Professor Joe, "Palimony - Scottish Style" 2008 Scottish Law Gazette 95

Upper Crathes Fishings Limited v Bailey's Executors 1990 SLT 46

Walker, The Law of Civil Remedies in Scotland (1974)

 

NOTE

Introduction

(1)   The parties in this case cohabited with each other between October 2001 and September 2007. They are co-proprietors of heritable property (The Curling House, Crowbyres, Hawick) which was built during their cohabitation. There are three children who were accepted as children of the family during the parties' period of cohabitation.

(2)   The pursuer sought division or sale of the heritable property; a capital sum of £312,000 payable to her; and a further capital sum of £100,000 in respect of the economic burden of caring for the children. In a counter-claim, the defender sought a capital sum of £300,000 payable to him. The financial claims were all made under section 28 of the Family Law (Scotland) Act 2006.

(3)   Parties were allowed a proof. (The certified copy record still contained preliminary pleas for both parties but it was agreed that these should have been removed.) I heard evidence over five days between February and March 2010. Submissions were made on 24^th May 2010, at which point I made avizandum.

(4)   I wish to express my gratitude to Ms Wild and Ms Loudon for their balanced and reasonable conduct of the proof, and for their efforts to agree as much of the factual history as possible. It is no discredit to their best efforts to acknowledge that there were times when the proof appeared to be drowning in a sea of invoices and other productions. Both counsel also prepared written submissions which I found most helpful.

Evidence

Pursuer's Witnesses

(5)   The pursuer said that, after failed negotiations, the house had been put on the market early in 2009, but without success so far. It was initially marketed at offers over £400,000 as that was what she thought it was worth. She found at one point that the property had dropped out of the ESPC without the defender's agents noticing. One person had been interested but had not pursued it, even when the agents told him the price had dropped. Auction might now be the way to go. Division of the house was not an option, not least as the parties could no longer bear to live in the same house. She said she had a business management degree and detailed her employment history. Had she not given up work in June 1998 to care for Kieran, she would have had a good chance of promotion. She now worked four days a week and the children attended the after-school service. The defender kept busy with horses and was incapable of looking after the children: she had always done everything for them and always would. She and her mother jointly bought her mother's council house at Roberton Place, using an endowment mortgage for which she ultimately took responsibility. The defender had nothing to do with the various improvements in the property that she paid for. Her mother had allowed her to keep the free proceeds of sale.

(6)   She had bought stables and a horse for £2,500 from a Mrs Johnson, who then offered her the land on which she had kept the horse. The agreed sale price was £6,000. Her mother and stepfather gave her the money in cash. Having missed Mrs Johnson several times herself, she gave the cash to the defender's brother Mick Murphy to pass to her as he was a neighbour, and he did so, in November 2002. In return she received the title deeds and assumed the land was now hers. The idea of building a house on the land was suggested to her in January 2003 by the architect whom she instructed to prepare a deed plan as there were boundary complications. She enquired into the possibility of supplying services to, and building a house on, the land and engaged in detailed correspondence and meetings with various authorities.

(7)   It was only when applying for full planning permission that she realised she did not own the land. Mrs Johnson became rather awkward - she thought she had been ripped off as, with planning permission, the land was worth £80-100,000 - and said she would put the land in Mick's name as he had given her the money. Mick then transferred the title to her and the defender (who insisted the title should be in joint names) for £6,000, although in fact they did not pay him anything. Her solicitor understood why the land was put in Mick's name. She could not comment on whether Mick had tried to buy the land in 2002. She would have preferred the title to be in her sole name, but felt pressurised by the defender into taking it in joint names.

(8)   She dealt with all issues of planning, design and building control, with no input from the defender. She dealt in detail with the preparation of the land for building, the supply of utilities, and the detailed design of the property; and researched and chose suppliers and contractors for the building work. The defender had no input into any of these matters. She contracted with the company who supplied and built the kit, and with the other contractors and suppliers. All the correspondence and invoices were addressed to her. Many of the contractors were people she considered as friends of hers or of the parties as a couple. She organised the work. The defender did the grass, chatted to people and made coffee, but mostly looked after the horses. He made no financial contribution, and anyway had no capital. The cost of employing a contractor to do the whole job would have been over £220,000; instead the house was built for under £100,000. Funding came from the sale of Roberton Place and a further gift of £29,000 from her mother. She was not working at this time and the defender had not worked since 1993; both were in receipt of state benefits. The defender received incapacity benefit by telling the medical board that he was depressed. He used his benefits on horses or things for his cars.

(9)   She had not worked between 1998 and the start of 2010, primarily for child care reasons. All three children would need after-school and holiday care until their sixteenth birthdays. The defender would now have the children every few weeks on a Saturday afternoon, on a flexible arrangement as previous contact orders had been dropped. Her mother and step-father sometimes helped, and occasionally her new partner.

(10)           Under cross-examination, the pursuer accepted she had controlled the couple's finances. Both had access to and used the defender's bank account (into which their benefits were paid), she for household purposes and he for his own interests. She disputed that the defender had made an equal contribution to household expenses or had paid cash to any of the tradespersons working on the house. She had not said she had a degree; it was a qualification in business management which she gained by attending college part-time for two years on leaving school. The defender would not have watched the children to allow her to go back to work part-time. He had recently again refused to take them for extra time during school holidays, and generally had proved unreliable. It was unrealistic to expect him to do more. In planning for future child care costs, she had to assume the worst scenario.

(11)           All major improvement works at Roberton Place had been completed before the defender moved in with her there. Discussions with Mrs Johnson about the purchase of the land took place at the stables. She denied that the defender had received money from James Ross to buy the land. The scrap merchant who agreed to allow the utilities to go through his land was a friend of both of them, not solely the defender. She still thought of the house as hers, not theirs, since she had done all the work. She disputed that the defender had helped to the extent claimed by the tradespersons: he was constantly complaining of difficulty in walking due to gout. She had taken those who assisted to be friends of the couple, but people had taken sides when they split up. It was all the talk of the town: someone had said to her "Youse are like the Beckhams of Hawick". She accepted that the defender had bought or acquired the septic tank, and may have helped occasionally to the extent of holding a ladder, but otherwise as far as she could see his contribution was negligible. She accepted she had received a repayment of VAT of about £2,300 in relation to expenditure on the house.

(12)           In response to judicial questions, she said that as of October 2001 both parties were on benefits; she had limited capital, certainly less than £5000, and the defender had none. At the end of the cohabitation, there was £3000 in the defender's bank account to which their benefits were paid, and she had about £400-500 in a current account and £1300-1400 in another account into which child tax credit was paid.

(13)           On re-examination, she said Mrs Johnson had sold her the horse as she had back trouble and her husband was also ill. She had then talked about selling the land since, without having the horse, she had no further use for it.

(14)           Mr John Hunter is a solicitor. He acted on the pursuer's instructions in the purchase of the land. With reference to the disposition by Michael Murphy in favour of the parties, he thought the pursuer had advised him that the money had been paid direct to the seller. He also recalled handling the sale of the flat at Roberton Place.

(15)           Mrs Elaine Lindsay (aged 59) is the pursuer's mother. After she and the pursuer had bought the flat at Roberton Place, the pursuer had got a loan to put in an extension and a new kitchen, and had redecorated. Although the parties were already in a relationship by then, she did not know if the defender had helped. When the pursuer started speaking about Mrs Johnson offering her the field, she and her partner gave her £6,000 cash to buy it. She understood the pursuer had used the money to buy the field. Just before Danika's birth, she had loaned the pursuer around £29,000 in total to enable her to complete the house. The pursuer ran about doing everything to get the house built. She and her partner were often there and helped with decorating. The defender was generally in his tack room. The pursuer seemed to do most of the child care.

(16)           Under cross-examination, she said that her information about the land purchase came from what the pursuer had told her. Her visits to the house had been outwith working hours. She took great interest in the children and would be happy to continue to help.

(17)           Mr Lesley Casson (46) has been the pursuer's partner since 2007. He said the pursuer looked after the children herself, and managed her own finances.

(18)           Mr Malcolm Macdonald (47) is Mrs Lindsay's partner. Going by his diary, he recalled giving Mrs Lindsay £5,000 of the money passed to the pursuer to purchase land. Once work started, the pursuer was always talking about what she was doing or who she had to see about it. When going up to help in the evenings, he had never seen much of the defender. He and Mrs Lindsay often took the children at weekends while the pursuer ran around organising things. According to his diary, he and Mrs Lindsay had had the children almost every second day, and they would continue to provide a stable place for the children.

(19)           Mr Sidney Palmer (67) was an architect and is now retired. The pursuer first contacted him around December 2002 with instructions to prepare a deed plan for the Curling Pond site. After she obtained outline planning permission - which anyone could do on any land, as long as they notified the owner - she then instructed him to develop the design for the house. This might have involved two days' worth of input from the pursuer. He had never met the defender. His practice applied for the building warrant and prepared the drawings so that the pursuer could apply for planning consent.

(20)           Ms Fyonnah Thomas (43) is a management accountant. She and the next witness Mrs Peggy Richardson (72), whose husband had been a publican in Hawick, spoke to the pursuer's employment history up to 1998. Ms Thomas described the pursuer as hard-working and looking like she wanted to improve herself.

Defenders' Witnesses

(21)           The defender confirmed that he acknowledged the pursuer's three children as being his. When he first used to stay with the pursuer at Roberton Place he had about £20,000 (mostly from his from his ex-wife), which paid for the kitchen and new carpets, as well as a nice car. They also put in central heating. He helped with the work. He also contributed to household running costs. During their cohabitation, the pursuer controlled the bank account into which his benefits were paid, as he didn't know the PIN number. On the day when the pursuer left him, she left a note of his PIN number. He sometimes bought or sold cars for friends and would make the odd £50. He had not worked after moving into Roberton Place as he had gone off the rails a bit after a series of bereavements. The pursuer had made up her own mind about stopping work. He would have helped to look after the bairn if she had wanted to go back to work, but it never came up in discussion. He had fed the children and played with them, and would like to see more of them now, including overnight contact. He had sometimes been asked to help, but only when it suited the pursuer. He would be happy to help more.

(22)           He wanted to sell the house and had had about half a dozen people viewing it recently. Meantime he had been maintaining it himself. He wouldn't consider auctioning it as the market was going up and various folk had been looking at it recently. The pursuer had not bought either the land, or a horse, from Mrs Johnson, whom she didn't know. The parties had bought the land from his brother Mick. His friend Jimmy Ross gave him the £6000, the plan being that he could keep his horses there.

(23)           The £85,000 used to pay for work on the house came from the sale of Roberton Place, but he had put a lot of money into that house. Although he had had some contact with the architect and planners, the pursuer did most of that as he wasn't good at reading and writing. But they had discussed the plans in detail. The pursuer chose most of the suppliers. The tradesmen were generally friends whom he had known for a long time, or relatives including his son. Many of them also supplied materials. Some charged commercial rates, some charged much less, and some did the work as a favour for him or for both parties. He helped many of them. They had saved thousands of pounds on matters such as scaffolding hire, plastering and tree work. He paid the joiner out of the proceeds from selling a car. He paid for the septic tank and for the tarring of the driveway. Both parties had made financial contributions, his being through the land, the work, and getting friends to do jobs.

(24)           Under cross-examination, he said the money from his wife had come partly in cash from her, and partly through the solicitor. He was divorced in 1996 and he thought, but couldn't be sure, that the money was paid after that. The parties had in reality been living together for a long time before 2001, but that was when he gave up his Council house and officially moved in with the pursuer. He had arranged various pals of his to do work at Roberton Place before 2001, often for nothing. He had ripped out a fireplace and carried out other works. The parties would decide together what needed done. He did help various people with their horses, but not all day or every day. The photo of the pursuer on the horse "Digger" was taken when she tried it at his brother's stables, but it ran away with her and she never got on a horse again.

(25)           He handed over the £6,000 cash for the land to his brother Michael, probably in the autumn. The money from James Ross was a loan which he was still to repay. Mr Ross was going to install a horse walker at the house. He couldn't recall what he did with the balance of £2,500 from Mr Ross. He had not put money into the pursuer's bank account, although she was able to withdraw money from his account. The pursuer had first instructed the architect, and the engineering survey, while Mick still owned the land: she was desperate to get the land and build a house, although Mick didn't think she would get planning permission. He had assisted various skilled tradesmen with several aspects of work on the house, but accepted that much of his input could be described as labouring. He accepted that the pursuer ordered most of the materials.

(26)           He had been on the dole for a while, and on incapacity benefit since at least 2005. He had depression and found it hard to focus on a task, but thought he had said at a medical examination that he was helping to build his own house. Doing things, especially with friends that were trying to help him get through it, helped him to feel better. From the parties' joint benefit payments, the pursuer would give him some money but not every week. Any money he had would go on the family. He sold a car in 2006 for £4,500 and the money was used to buy a cheaper car and, probably, to pay for either decking at the house, or tarring of the drive. Mr Lindsay and Mr McDonald would have seen him at the house; he decorated the kitchen and bathroom with her.

(27)           He was the cook in the house - the pursuer was not very good at cooking - and the pursuer tended to do the cleaning. He did go to the stables and see his friends but was still in the house enjoying normal family life. Perhaps he had not done as much for the children as he should have. He was keeping the house tidy for viewings and had had at least 6 people. He had no idea how much more it would have cost to employ a project manager and construction company to build the house.

(28)           In answer to judicial questions, he could not recall what he had to his name in 2001. At the time of separation, he had £2,500 in the bank according to the statement. Mick would sometimes give him money for helping to look after his horses.

(29)           James Ross, a retired estate worker, had known the defender for about 40 years, and the pursuer for 3 or 4 years. The defender asked him to work on the expansion joints, which he did without payment as he had horses there. He loaned the defender £8,500 in November 2003 to enable him to buy the land, and gave him the money in cash. He had hoped to put stables up to bring on his younger horses there.

(30)           Under cross-examination, he said he had written the loan document afterwards, although he trusted the defender as a friend. He was told that stables, not a house, were to be built on the land. When he heard a house was to be built, he was pleased for the defender. They were really good friends and had had horses together since they were young. He had always watched his money, and viewed this as a place where his horses could go.

(31)           Barbara Johnson is a neighbour of the defender's brother Michael Murphy. She and her husband had acquired the curling pond field, probably in 1999, intending to use it for grazing horses. When her husband became unable to ride, he had decided to sell both the field and their horse "Digger" to Mick Murphy. The price for the field was £6,000. The sale was agreed in 2002 but not finalised until August 2003, due to problems with the boundary. She also sold stables in her yard to Mick Murphy. She did not even know the pursuer then and first met her only when she moved into the Curling House. Digger was now back with her.

(32)           Under cross-examination, she said she did not know the pursuer in 2002. She accepted the pursuer had been photographed on Digger outside the stables in her yard in 2002, but said lots of people liked to have their photo taken on horseback. She did not know her then and had not sold either the stables or the field to her. She did not know how the pursuer had come to have the title deeds, or that the pursuer had instructed a deed plan or undertaken other preparatory works during 2003. As far as she was concerned, Mick Murphy had taken the ground at the same time as the horse, in 2002. He had paid her the money before anything was signed. Digger had initially stayed in the stables at her yard. She was not certain where he went thereafter but said he was never in the stables at the Curling House. She had had difficulties with the pursuer and really did not want to be in the same room as her.

(33)           Michael Murphy (known as Mick) is the defender's brother. He is a transport and distribution manager although horses are his passion. He bought the curling pond field, stables, and the horse Digger from Mr and Mrs Johnson in about 2002. The price was £6,000 for the field and £2,000 for the stables. The parties then wanted to build a house on the field, so he said to go ahead, not realising they would have to own the land to do so. He then sold the field to them for the same price of £6,000, and after the defender had given him the money he asked his lawyer to sort it out. He was not involved in the building of the house.

(34)           Under cross-examination, he said the pursuer was photographed on Digger as she wanted to have a go at riding. The horse ran away with her and she didn't get on it again after that day. The Johnsons followed her in their car to make sure she was okay. In the photo she was sitting all wrong on the horse. As soon as he had bought the field, the parties were persistent in wanting to build a house on it. He may well have given the pursuer the title deeds, and he gave permission for preparatory work as long as the parties paid for it. He had assumed that planning permission would not be granted, but the pursuer was persistent and got it. In hindsight after all that had happened now, he wished he had kept the land and built a house on it himself. But when the parties said they needed to own the land to build on it, he felt he could not go back on his word and agreed to sell. The defender gave him the money in cash. He recalled that the defender's wife had, on their divorce given him money for his share of their house, as she wanted to keep the house.

(35)           The defender also called a succession of witnesses, speaking in short compass to their involvement in the building of Curling House. Richard Gray had not really known either of the parties until he was asked by Keith Borthwick to give a hand with the foundations. He charged a commercial rate. Malcolm Cooper laid and connected the water pipes, as a favour. Stuart Clark is the partner of the defender's daughter. He did the external roughcasting without charging. Commercially, he estimated the cost would be £5,000-6,000. Lindsay Rae knew both parties; he assisted with roughcasting and tiling work; he charged less than a commercial rate as he was doing it as a favour. Steven Scott had known the defender for longer but got to know the pursuer while working at the house; he did blockwork and stonework for payment below commercial rates, as he knew the defender and knew he would assist. He worked from the plans and would raise any questions with the defender, as he was on site all the time. The pursuer paid him although he assumed the money came from both parties. Craig Bridgewater, a local farmer, knew the defender through his brother. He pulled various piece of heavy equipment onto site, supplied surplus topsoil, and used his forklift truck. He did not charge as he was due favours to the defender's brother. David Vevers thought he had known the defender for about 20 years and the pursuer for about 10. He helped with the water supply work and charged as normal. Scott McNeill had known both parties for about 7 or 8 years. He and his father helped with electrical work. Harry Pretswell had known the defender for 40 years and the pursuer for at least 20. He provided scaffolding, which was used for 18 months, but did not charge as you help each other out as friends and the defender had helped him out. Renting would have cost perhaps £5,000-8,000. David Murphy (the defender's son) is a chartered engineer and helped with the initial flood risk assessment, which he did for his dad. A commercial rate might have been about £1,000. James Inglis had known the defender for perhaps 20 years, and the pursuer for perhaps 10 years. He did ames taping and artexing. The bill would have been another £1,000 had the defender not helped him out. He also recalled doing some work at Roberton Place, perhaps for some cash: that was when he had got to know the pursuer. The defender had helped him with buying vehicles and with business recommendations. Alistair Mabon had known the defender for a long time and the pursuer for less. He charged a "mate's rate" for doing the decking and other work. He recalled doing some work at Roberton Place, before the parties moved to the Curling House. The size of the decking had been agreed with both parties. Paul Murray had known the defender for 20-30 years, and the pursuer perhaps for 15. His horse was stabled near the house. The defender asked him to do painting work as a favour. He did not charge for the work as the defender had helped him fix his car. He recalled seeing Mrs Lindsay doing some painting. David Telford had known the defender all his life, and knew the pursuer from coming to the house. He had carried out tree work without charging, as the defender had helped him with buying various vehicles. A commercial charge would have been £600 per tree. Brian McGinn had known both parties for some time. He did slabbing work as a favour for the defender. He had done some coving work at Roberton Place. Thomas Lavery had known both parties for most of his life and his wife was friendly with the pursuer. He helped with various aspects of grounds work but did not charge as he was doing the work for a friend. At Roberton Place, he had cut a hole in the wall for a new fire as the parties were getting gas put in. Terry Scott had know the defender since his childhood, and the pursuer not so long. He did a lot of labouring work at the house. It was the defender who asked him to do different jobs. Scott Simpson painted a bedroom. He charged less than usual as he knew the parties. The defender paid him but said the money was from the pursuer. David Szabo had known the pursuer since she started going with the defender, and the defender for some years before that. He helped with all sorts of work at the house, without charge.

(36)           Almost all said that the defender was around more than the pursuer while they were working at the house, that the defender assisted with manual work as required, and that the pursuer would have seen him doing so. Several added that the defender was often doing jobs around the property but, if not, could be found in the stables. A number were warm in their appreciation of practical assistance the defender had given them with, for instance, purchase of vehicles at auction, or finding jobs.

(37)           Ben Graham works in estate agency for the defender's solicitors. He said that as far as they were aware, there had been 3 viewings of the Curling House in the tail end of 2009, 2 of them being by the same person. Where a property for sale is owned jointly, they would normally advise both owners if anyone noted interest or asked to survey the property. The pursuer had raised the possibility of sale by auction; the property would have to be withdrawn from them and from the ESPC as the local agent who does auctions is not in the ESPC. Under cross-examination, he said it was quite possible there had been additional "drive-by" viewings, by people who know the vendors.

Submissions

Pursuer

(38)           Ms Wild said that the capital sums sought by the pursuer were now £275,000 under section 28(2)(a), and £20,000 under section 28(2)(b). In respect of crave 1, for division and sale, her motion was to remit to a person of skill to propose an upset price and a means of selling. While the parties had entered into a minute of agreement regarding sale of the property, it offered no remedy for the situation where the property had been on the market for two years. The evidence suggested that all reasonable steps were not being taken to sell the house, and thus that the terms of the agreement were not being upheld. Remit to a person of skill might also offer suggestions as to how to achieve a sale. Payment of any sums ordered in terms of craves two and three would have to await conclusion of the sale of the property; there would then also be a question as to when interest would become payable.

(39)           She characterised the exercise the court had to undertake in terms of section 28 as a balancing act in which any financial imbalance suffered during cohabitation by either party could be redressed. Lord Matthews' decision in M v S to reduce the pursuer's loss by half was criticised by Professor Joe Thomson in his article "Palimony - Scottish Style". The concept of fair sharing as expressed in the Family Law (Scotland) Act 1985 and as applied in, for instance, Dougan v Dougan, had not been reproduced in the 2006 Act, but the nature of the exercise was similar and the court could take a broad brush approach. In Gow v Grant, the sheriff had emphasised the concept of compensation rather than balancing, but the end result was affected more by the method of applying the statutory factors to the circumstances of the case. The circumstances here were very different from those in Jamieson v Rodhouse: the defender here was now in a substantially improved position as a result of cohabitation. The cases of M v S and F v D were helpful in relation to the claim under section 28(2)(b). In M v S, it was assumed that existing contact arrangements would continue, and the method of calculating the economic burden was similar to that used by the pursuer here.

(40)           It was agreed that the parties had been cohabitants within the terms of the Act and that the action had been raised timeously. In relation to the section 28(2)(a) claim, the defender had derived economic advantage to the extent of the value of his one half share in the Curling House, namely £175,000. Alternatively, his economic advantage could be quantified by considering the benefit derived from the pursuer's endeavours which had increased the value of the land from £6,000 to £80-100,000 and saved at least £120,000 on the building costs of the house, and from her capital investment in the property. Where friends had worked at less than commercial rates, that was to the advantage of both parties and thus not relevant to the overall balancing exercise. The defender had suffered no economic disadvantage: he made no significant financial or non-financial contribution to the relationship. The pursuer was the principal carer of the children. The pursuer had suffered clear economic disadvantage: at the start of the relationship she was earning around £20,000 per year and owned the flat at Roberton Place. She had been unable to return to work in 2004 as a result of her third pregnancy, even though the defender could have looked after the children to enable her to do so. She bought stables and a horse from Mrs Johnson, followed by the land on which the house was built. The Curling House was built as a result of the pursuer's capital investment and her endeavours and industry. Finally, any economic advantage derived by the pursuer from the defender's contributions would arise only from manual work he had undertaken at the house and would not be significant. The pursuer's claim of £275,000 comprised half the value of the Curling House together with £100,000 in respect of loss of employment opportunity since 2004.

(41)           Turning to section 28(2)(b), the defender was economically advantaged as the pursuer had taken on the main burden of child care, towards which he had paid little. The pursuer was correspondingly economically disadvantaged. She could work only part-time and would incur child-care costs up to each child's 16^th birthday, at a rate of £870 per child per year. Pre-school child care for Danica from January to August 2010 would cost £1,440 in total. There was now no formal contact order and the defender was not exercising contact regularly. Following M v S, it was appropriate to assume that the current level of contact would continue.

Defender

(42)           Ms Loudon commenced by seeking to amend the defender's plea in law number three to refer to both the orders second and third craved by the pursuer. Her motion was unopposed and I allowed it.

(43)           On the crave for division and sale, the proper procedure was set out in Macphail (2^nd edition, paragraphs 23.37-23.41), starting with a remit to a person of skill. Equitable considerations could be taken into account in determining the method of sale (paragraph 23.37). Following Campbell v Murray and The Miller Group v Tasker, there was now no presumption in favour of sale either by public roup or by private bargain. The pursuer now favoured sale by auction but had produced no expert evidence to justify that. There was no need for an order. In any event, the parties had agreed within their minute of agreement that its terms were irrevocable, so the issue was still governed by contract. The court should accordingly refuse to grant decree in terms of crave 1.

(44)           On the interpretation of section 28, she considered that while there was a lack of evidence of the parties' respective financial positions in M v S and Jamieson v Rodhouse, both cases were of some interest in that they showed different approaches to whether assistance could be gained from cases under the 1985 Act. The sheriffs in F v D and in Gow v Grant had dealt with claims under section 28(2)(a) by considering subsections 28(3)(a) and (5) together, and then subsections 28(3)(b) and (6) together, without carrying out a balancing exercise. The court should, however, have regard first to the terms of subsections (3)(a) and (b) to determine whether an order is justified at all, and then to the terms of subsections (5) and (6) in relation to the amount of the award. The purpose of section 28 capital awards was to address economic imbalances arising as a result of cohabitation, not to give a right to claim compensation.

(45)           In relation to the pursuer's claim under section 28(2)(a), she accepted that the defender had derived an economic advantage from the pursuer's financial and personal contribution to the building of the house. VAT of £2,300 reclaimed by the pursuer had to be taken into account. But the pursuer had not established that she had suffered any economic disadvantage in the interests of the defender or the children. Her interest in the Curling House was now worth more than her contributions to it. It was her choice to give up work, during which period she received state benefits. She had been planning to go back to work in 2004 until she fell pregnant again. In contrast to the position in Dougan v Dougan, it was speculation as to whether she would have continued in her employment or moved to a better job. It was notable that N Peal had put all staff on short-time working for two years before she left them.

(46)           The defender's economic advantage was partially offset by economic disadvantage in that he contributed £20,000 received from his former wife, £8,500 borrowed from James Ross, about £6,000 realised from selling two cars, and certain purchases for the house. His contribution spanned the whole period of the relationship, and there was no requirement under the Act to limit contributions only to the period of cohabitation. The pursuer had also derived significant economic advantage: parties were able to purchase the land for such a low sum only because it was purchased from the defender's brother (and there was no record for the pursuer's contention in evidence that the defender forced her to put the land into joint names); and the main reason the actual building costs were so low was because of the work done for reduced or no charge by friends of the defender, with his assistance in some cases. He had also maintained the property since 2007. Thus the defender's economic advantage and the pursuer's concomitant economic disadvantage to the extent of £83,000 were offset by the defender's financial contributions and by the economic advantage derived by the pursuer from the defender's non-financial contributions.

(47)           In relation to the claim under section 28(2)(b), the pursuer had not clarified why she thought it unrealistic for the defender to look after the children when not at school. Further, the sum sought made no allowance for the children being with friends or family, or on holiday, or for the older children helping out in future. At best there was scope for a small award under this subsection.

(48)           There was no evidence that the defender had any resources beyond his share in the house. While there was no reference in the 2006 Act to the parties' resources, the court might be slow to make an unenforceable award (M v S). In short, her position was that I should sustain the defender's first plea in law, and his second plea in law in relation to crave 2. In relation to crave 3 (the section 28(2)(b) claim, I should either refuse it or award a much smaller sum than the £20,000 sought. The question of timing of any order for payment could be addressed at a further hearing. Finally, she confirmed that the defender was no longer insisting in his counter-claim.

Further Submissions in Reply

(49)           Briefly, Ms Wild said there was no credible evidence of financial contribution from the defender. As a recipient of incapacity benefit throughout the period of cohabitation, he would not have been able to have more than £3,000 in capital at any one time. There was evidence that he had sold one car, but then used part of the proceeds to buy another car. The question of the defender looking after the children was quite different now than when the relationship was continuing, although she accepted that I had heard little evidence as to the current position.

(50)           Finally, counsel moved jointly that I should reserve the questions of interest and expenses, and that I should sanction the case as suitable for the employment of junior counsel.

Assessment

Division and Sale

(51)           An action of division and sale may be taken as of right by any person having title and interest to do so (Burrows v Burrows; Macphail, paragraph 23.37). But a proprietor may bar himself by contract from the right to resort to division and sale (Upper Crathes Fishings Limited v Bailey's Executors, Lord Clyde at 47L-48A, referring to Morrison v Kirk) as would clearly be the position here if the minute of agreement of November 2008 remained in force. The pursuer's argument, which it has to be said was made rather weakly in submissions, was that she was no longer bound by the terms of the agreement. The basis for that suggestion appeared to be either that the minute made no provision for the possibility that the house would not sell on the open market, or alternatively that the evidence pointed to a failure by the defender to implement the agreement.

(52)           The only evidence suggesting that the defender was in breach came from the pursuer. That evidence was itself weak and did not clearly imply deliberate breach by the defender, far less that any interest in the property had been lost as a result. Indeed, the pursuer herself spoke to the fact that the selling agents had followed up a possible interest in the property after the reduction in price was agreed. I also have to note that the upset price was originally set £50,000 higher than the valuation, at the pursuer's insistence; that would certainly not have contributed to achieving a quick sale.

(53)           As for the alternative argument, I note that the agreement provides in specific terms for the defender's agents to market the property and the pursuer's agents to undertake the conveyancing; for the parties to consult each other and to accept any reasonable offer; and for the treatment of the free proceeds of sale. Ms Wild offered no authority for the proposition that the agreement had somehow been superseded by events simply because the property had not yet been sold. Any such justification would presumably have to focus on alleged frustration of performance of the contract. As McBryde states,

"Frustration applies to a supervening event, outside the control of the party founding on it, for which the contract makes no provision. The result must be that performance, if possible at all, would be radically different from what the parties contemplated at the time of the contract. Frustration occurs independently of the actions or omissions of the party who relies on it. The effect is to discharge the parties automatically from further performance of the contract, and so it is not a doctrine lightly to be invoked." (paragraph 21-04).

No basis whatsoever was offered for the application of this principle here.

(54)           It is understandable that the pursuer in particular may now wish to progress matters by alternative means, such as sale by auction. But, quite simply, that is not what she agreed to do and she cannot now ignore her contractual agreement on the grounds that it no longer suits. Any change in the method of sale would require the agreement of both parties.

(55)           I make no finding suggesting that the defender is in breach of the agreement (Findings 35-37 refer). I can find no basis for setting aside the clear agreement of the parties. I will therefore make no order in respect of the pursuer's crave for division or sale.

Section 28 Claims: The Law

(56)           Sections 25-29 of the Family Law (Scotland) Act 2006 provide, for the first time in Scots Law, a legal framework for cohabitants in relation to rights to household goods, money and property, financial provision post-cohabitation, and succession where a cohabitant dies intestate. Section 28 in particular deals with financial provision where cohabitation ends otherwise than by death. It is a matter of agreement here that the parties were "cohabitants" as defined in section 25, and that the cohabitation has ceased. It is further agreed that the 3 children are "relevant children" as defined in section 28(10).

(57)           Section 28 states:

(1) "Subsection (2) applies where cohabitants cease to cohabit otherwise than by reason of the death of one (or both) of them.

(2) On the application of a cohabitant (the "applicant"), the appropriate court may, after having regard to the matters mentioned in subsection (3)-

(a) make an order requiring the other cohabitant (the "defender") to pay a capital sum of an amount specified in the order to the applicant;

(b) make an order requiring the defender to pay such amount as may be specified in the order in respect of any economic burden of caring, after the end of the cohabitation, for a child of whom the cohabitants are the parents;

(c) make such interim order as it thinks fit.

(3) Those matters are-

(a) whether (and, if so, to what extent) the defender has derived economic advantage from contributions made by the applicant; and

(b) whether (and, if so, to what extent) the applicant has suffered economic disadvantage in the interests of -

(i) the defender; or

(ii) any relevant child.

(4) In considering whether to make an order under subsection (2)(a), the appropriate court shall have regard to the matters mentioned in subsections (5) and (6).

(5) The first matter is the extent to which any economic advantage derived by the defender from contributions made by the applicant is offset by any economic disadvantage suffered by the defender in the interests of-

(a) the applicant; or

(b) any relevant child.

(6) The second matter is the extent to which any economic disadvantage suffered by the applicant in the interests of-

(a) the defender; or

(b) any relevant child, is offset by any economic advantage the applicant has derived from contributions made by the defender.

(7) In making an order under paragraph (a) or (b) of subsection (2), the appropriate court may specify that the amount shall be payable-

(a) on such date as may be specified;

(b) in instalments.

(8) Any application under this section shall be made not later than one year after the day on which the cohabitants cease to cohabit.

(9) In this section-

"appropriate court" means-

(a)   where the cohabitants are a man and a woman, the court which would have jurisdiction to hear an action of divorce in relation to them if they were married to each other;

(b)   where the cohabitants are of the same sex, the court which would have jurisdiction to hear an action for the dissolution of the civil partnership if they were civil partners of each other;

"child" means a person under 16 years of age;

"contributions" includes indirect and non-financial contributions (and, in particular, any such contribution made by looking after any relevant child or any house in which they cohabited); and

"economic advantage" includes gains in-

(a) capital;

(b) income; and

(c) earning capacity;

and "economic disadvantage" shall be construed accordingly.

(10) For the purposes of this section, a child is "relevant" if the child is-

(a) a child of whom the cohabitants are the parents;

(b) a child who is or was accepted by the cohabitants as a child of the family.

(58)           Both counsel raised the issue of the possible relationship between the provisions of the 2006 Act and the provisions of the Family Law (Scotland) Act 1985 for financial provision on divorce or following the breakdown of a civil partnership. In my view, and with due respect to the views expressed by Lord Matthews in M v S, this comparison serves little practical purpose when it comes to understanding the purpose and scope the provisions of the 2006 Act. Some of the terminology used in the 2006 Act undoubtedly draws on that used in the 1985 Act, so that in an appropriate case it may be possible to draw on 1985 Act cases in interpreting specific terms such as "economic disadvantage". But the context in which that terminology is used in section 28 is much looser and more flexible than in the 1985 Act. In my view, this does no more than reflect the reality that cohabitation is a less formal, less structured and more flexible form of relationship than either marriage or civil partnership.

(59)           Under section 28(2), the court "may" make an order, "after having regard" to certain matters. By contrast, under section 8(2) of the 1985 Act, the court "shall" make such order, if any, as is "justified" by the section 9 principles, and reasonable having regard to the parties' resources. The basis of the 1985 Act scheme is one of entitlement, whereas the basis of the 2006 Act scheme is discretion. The significance of that distinction is, in my view, underlined by the absence in the 2006 Act of any equivalent to the principle of fair sharing of matrimonial resources (1985 Act, section 9(1)(a)) or, indeed, to the notion of matrimonial property (1985 Act, section 10(4)).

(60)           Even where the apparently identical concepts of economic advantage and economic disadvantage appear in the 1985 Act, they are applied rather differently than in the 2006 Act. One of the section 9(1) principles is that "fair account should be taken" of any economic advantage derived by one party from the other's contributions, and of any economic disadvantage suffered by one party in the interests of the other or of the family. The use of the term "fair account" seems to imply a rather more structured approach than is suggested by the terms of the 2006 Act, section 28. This impression is reinforced by the next of the section 9(1) principles, that the economic burden of caring for a child after divorce or dissolution "should be shared fairly" between the parties, which again does not appear in the 2006 Act.

(61)           Further, under section 11(2) of the 1985 Act the court is directed to have regard to the extent to which economic advantages or disadvantages sustained by one party are "balanced" by those sustained by the other party, and the extent to which any resulting imbalance is corrected by the sharing of value of matrimonial property. But under the 2006 Act, any economic advantage that the defender appears to have gained and any economic disadvantage suffered by the applicant are simply 2 factors to which the court must "have regard". In considering a claim under section 28(2)(a), the court must also have regard to the extent to which any economic advantage enjoyed by the defender is offset by any economic disadvantage suffered by the defender (subsection 28(5)). There is a similar requirement to offset any economic advantages gained by the pursuer against his or her economic disadvantages. What is absent from the 2005 Act scheme is any explicit requirement to "balance" any economic advantages (or disadvantages) pertaining to one party against those pertaining to the other. Any offsetting is assessed for each party individually, not comparatively.

(62)           I find Sheriff Mackie's analysis of the meaning and purpose of the 2006 Act provisions, in Gow v Grant at paragraphs 39-43, to be of considerable assistance. I share her regret that the logic of these provisions is not more readily apparent. It is not clear to me, for instance, why a former cohabitant's economic disadvantage should be offset by any economic advantage they have enjoyed when considering a claim under section 28(2)(a), but not when considering a claim under section 28(2)(b). I diverge from her analysis only in that I decline to characterise any payment ordered under section 28 to be "in the nature of compensation" (paragraph 42). The term compensation is not used in the 2006 Act and is perhaps pre-loaded with too many other shades of meaning in law to be of assistance here. The position is more simply and, in my view accurately, stated by Sheriff Mackie at paragraph 43:

"If at the end of this exercise the applicant appears to be left with some economic disadvantage then an award may be made".

(63)           Turning to more specific matters of interpretation, I can find nothing in the terms of section 28 to support Ms Loudon's contention that the court must first consider the section 28(3) matters as some form of threshold test to determine whether any award should be made, and only secondly consider the subsection (5) and (6) matters in quantifying any such award. In considering a claim under section 28(2)(a), the court is simply required to "have regard" to the various matters set out in these subsections. Such linkages as are explicitly made between these matters are in fact between subsections (3)(a) and (5) on the one hand, and between subsections (3)(b) and (6) on the other. The more obvious and natural interpretation is thus that the court should have regard firstly, to whether the defender has derived any economic advantage from contributions made by the applicant (subsection (3)(a)); secondly, to whether that economic advantage is offset by any economic disadvantage suffered by the defender in the interests of the applicant or any relevant child (subsection 5); thirdly, to whether the applicant has suffered any economic disadvantage in the interests of the defender or any relevant child (subsection (3)(b)); and fourthly, to the extent to which any such economic disadvantage is offset by any economic advantage the applicant has derived from contributions made by the defender (subsection (6)).

(64)           Having weighed up all these factors in the circumstance of each case, the court can then consider whether any award may be appropriate. None of the cases to which I was referred related to what might be considered a straightforward scenario in which one cohabitant gives up work to make home for the other and to care for their children. The circumstances of this case differ again, in that while neither party was in employment during their cohabitation, on the face of it both have gained a significant economic advantage in the shape of their heritable property. The range of possible scenarios to which section 28 may have application in itself reinforces the need for flexibility in approach by the court.

(65)           In relation to the claim under section 28(2)(b), it is of course only the subsection (3) matters to which the court must have regard. Nevertheless, it seems clear that the court should follow the same approach of having regard to any economic advantage derived by the defender from contributions made by the applicant, and to any economic disadvantage suffered by the applicant in the interests of the defender or of any relevant children, in weighing up what award may be appropriate.

(66)           There is a further complication, however, in that any award under this subsection may well relate to the future as much, if not more, than to the present or past. That remains so notwithstanding that the factors to which the court is to have regard are expressed, rather curiously, solely in the past tense. The question thus arises of what account I should take of the defender's assertion that he would be willing to offer considerable support with future child care. A similar question arose in M v S, where Lord Matthews had considered that he could not deal with the matter on the basis that the defender was prepared to exercise more contact, as that was a matter that could only be decided in its proper context and having regard to the best interests of the children (paragraphs 226-227; see also paragraph 325). I consider it appropriate to follow that approach, particularly given that I was made aware of a history of extensive dispute, in separate proceedings, over the defender's claim for contact with the children.

(67)           Two other matters of interpretation merit brief comment. Firstly, I agree with Ms Loudon that there is nothing in the terms of section 28 that requires the court to consider "contributions", as defined in subsection (9), only insofar as made during the period of cohabitation. Secondly, I was referred to Lord Matthews' comment in M v S (at paragraph 261) that courts might be slow to make an award that would plainly be unenforceable. I note that Sheriff Hendry took a rather different view in F v D, at paragraph 63. I am not convinced that it is possible or helpful to take a hard and fast position on this issue. In cases such as F v D, where the defender had shown an intention to evade payment, the court might well not pay overmuch attention to the extent of the assets declared by the defender. But where, as here, the defender's only assets of any value are quantified and are all wholly related to the cohabitation, it would be surprising if the result of the court's exercise of discretion under section 28 was an award that exceeded the total value of these assets.

Section 28 Claims: The Evidence

(68)           The principal issues of factual dispute here concern:

§         What contribution, if any, the defender made to the value of the pursuer's flat at Roberton Place;

§         Whether state benefits received during the cohabitation were used for family purposes;

§         The circumstances in which the pursuer did not return to work in 2004;

§         Who purchased the land at The Old Curling Pond;

§         Whether and to what extent the defender contributed to reducing the cost of construction of the house;

§         Whether and to what extent the defender paid for the costs of construction work and materials;

§         Whether the defender has breached the terms of the minute of agreement of November 2008 by failing to implement it.

(69)           Several other issues surfaced in evidence but, for various reasons, do not in my view constitute disputed issues of any ultimate significance. There was no basis on record for the pursuer's claims in evidence that the defender had not made an equal contribution to the family's living expenses during their relationship, or that he had pressurised her to put the land into joint names. Both parties alleged that the other had to some extent indulged in wasteful expenditure during their relationship, on matters such as cars or beauty treatments; but in the overall scheme of things, the amounts involved seemed relatively limited and also appeared largely to cancel each other out.

(70)           The pursuer's evidence was articulately presented and, superficially, plausible. For several reasons, however, I find it hard to place reliance on her evidence on disputed matters. She missed no opportunity to emphasise her assertion that the defender had made no contribution toward the design or construction of the house, taking refuge ultimately in saying that she had not seen him do anything. She made several claims that proved to be highly misleading: that she had a business management degree (a statement she later denied making), that she had had a company pension (her contributions in fact commenced only in December 1997 and her pension plan had a value of less than £1,000 as at October 2009), that she had had the use of a company car. The assertion that someone had described the couple as being 'the Beckhams of Hawick" seemed to be mined from the same vein of hubristic self-exaggeration.

(71)           As regards the purchase of the land, she was unable to explain the existence of correspondence between solicitors, dating back to November 2002, about Mick Murphy purchasing the land. When asked about that and other documentary productions that appeared to contradict her evidence, she tended to take refuge in being "confused" about the documents or their provenance. Her insistence that she had given the money to Mrs Johnson through Mick Murphy struck me as fanciful. Her evidence on the question of whether the defender could help with future child care was ambivalent: although she had asked him through her lawyer to take the children in the week when she started work, she would not be prepared to let him help in future because of his attitude to the children.

(72)           As her evidence progressed, I gained a strong impression that she was a person of very fixed, black and white views that would not admit of alternative explanations, no matter how strong the evidence. The house was her house; all the witnesses who might say that the defender contributed to work on the house were lying about that, and about working for less than commercial rates; all the improvement work at Roberton Place had been done before the defender moved in, and he had made no contribution to it; she had always done everything for her children and always would. In that context, her claim that she could not return to work in 2004 as the defender would not have helped with child care struck me as a statement more of her preconceptions than of the reality of the situation.

(73)           I had no reason to doubt the credibility of the pursuer's other witnesses. It seemed to me that the evidence of both Mr Hunter and Mr Palmer rather undermined the pursuer's own account: Mr Hunter recalled simply that the sum of £6,000 had been paid direct to Mick Murphy, with no suggestion that Mrs Johnson had played any part in the transaction with the pursuer; and Mr Palmer gave no indication that the idea of building a house on the land had originated from him rather than from the pursuer. Insofar as family witnesses could comment on matters such as the purchase of the land, their evidence was largely based on what the pursuer had told them. To that extent, the reliability of their evidence could be no better than that of their principal source.

(74)           The defender's evidence was frequently rambling and, at times, incoherent. He freely accepted that he was no good with dates and times, or with documents. Nevertheless, his evidence displayed a detailed grasp of the practicalities involved in all aspects and stages of construction work on the house (as did the pursuer's). In my view, given the defender's non-intellectual presentation, that knowledge could only have come from personal involvement. He was at times inclined to exaggeration, but usually only in response to a vague question ("What did you actually do?" - "I done everything"). When questioned in greater detail, he gave an account that appeared to be informed both by realism as to the level of his own contribution and generosity as to the contributions of others. That included the pursuer's efforts towards the building of the house, which he willingly acknowledged. His evidence of involvement in improvement works at Roberton Place was in part corroborated by various of the tradespersons. The picture I gained, both from his evidence and from that of many of the tradespersons, was that the defender was a gregarious and genial figure in a community where much business was done through exchange of favours. As regards the benefits payments received during the cohabitation, his evidence that the pursuer had controlled his bank account as well as her own appeared consistent with his presentation in court, and in my view effectively countered the pursuer's argument that he had largely spent his benefits on personal matters.

(75)           I found Mick Murphy's evidence entirely credible and reliable. He was a forthright and consistent witness who showed no signs of bias in favour of his brother. Indeed, at one stage he described the defender as "thick as mince"; he later said he rued the day he sold the land to "this pair". Similarly, I had no reason to doubt the credibility or reliability of the tradespersons called by the defender, most of whom acknowledged a degree of friendship with both parties. None showed any sign of ill-will toward the pursuer. Mr Graham's evidence was straightforward and in short compass.

(76)           Two of the defender's witnesses caused me some difficulty. Mrs Barbara Johnson made her dislike of the pursuer very obvious (not to mention her distaste for the prospect of cross-examination). Her evidence was, however, entirely consistent with the documentary productions relating to the sale of the land. While the pursuer had been photographed on Mrs Johnson's horse in 2002, I did not consider that to undermine Mrs Johnson's evidence that she had not known the pursuer at that time: as both she and Mick Murphy said, it was commonplace for people to have a photo taken sitting on horseback. I therefore conclude that her evidence is credible and reliable.

(77)           Mr James Ross presented as wholly sincere. But his evidence lacked credibility in various important respects. He said he had given money to the defender to buy the land in November 2003 as he hoped to put his horses in the stables that he understood the parties would be building there. Yet he seemed entirely unperturbed that this gift or loan had been made on a misleading basis, given that outline planning permission had already been granted 5 months previously, and that a house was subsequently built. He was referred to a note in his handwriting, signed by both him and the defender, which simply stated "I, James Ross, gave George Murphy the sum of £8,500 on 5^th November 2003": for reasons that were not explained he had given the note to the defender, rather than keeping it as some form of receipt. It was far from clear whether he ever expected the defender to repay the money. In all these circumstances, I am not able to place any reliance on his evidence and make no finding in respect of it.

(78)           In summary, with the exception of Mr Ross I prefer the evidence of the defender and his witnesses on the questions of his contribution to improvement works at the Roberton Place flat (Findings 8 and 9 refer), the use to which benefits payments were put (Findings 12 and 32), the pursuer's non-return to work in 2004 (Finding 25), the purchase of the land (Findings 13-14, 18 and 20), and the defender's contributions to reducing the cost of construction (Findings 27-28) and to the costs of construction work and materials (Finding 31).

Contributions Made by the Parties

(79)           Before considering how the statutory tests apply to the facts of the case, in the circumstances of this case I think it is necessary first to break down the value of the property into its constituent elements, and then to identify what "contributions" - as defined in wide terms in section 28(9) - have been made by each party in respect of these elements. This form of analysis follows the alternative method proposed by Ms Wild for assessing the economic advantage enjoyed by the defender in respect of the value of the property, although perhaps in greater detail.

(80)           I take no account of any cash savings held by either party at the start or at the end of the cohabitation. These were limited and within the same bandwidth. I also omit from consideration the benefits received by the parties during the period of cohabitation, given that I have found these were applied primarily for the benefit of the family. I also leave out of account the sums which the parties spent on cars and on beauty treatments, for the reason given in paragraph 69 above.

(81)           Assuming the value of the house to be £350,000, I take this to comprise five elements:

·         The purchase price of the land, which was £6,000;

·         The estimated increase in value of the land with planning permission, namely £74,000;

·         The costs of construction of the house, totalling £83,500 (net of the VAT refund to the pursuer - see Findings 30-31);

·         The saving made as compared to the estimated cost of construction by a professional builder, which is £220,000 less £83,500, namely £136,500 (Finding 23);

·         And a balance of £50,000 which represents the increase in value since construction.

(82)           I consider that the parties contributed to these 5 elements as follows:

·         The pursuer contributed the proceeds of sale from the Roberton Place flat, which (rounded to the nearest £100) amounted to £57,300. From that, however, I consider that the sum of £5,000 falls to be attributed to the defender as the best assessment I can now make of the extent to which his financial and personal contribution may have increased the market value of the flat. The evidence of who spent what on whom in Roberton Place during the 1990s was inevitably lacking in any detail, but given the range of works undertaken I consider this estimate to be moderate and conservative. Thus the pursuer's net contribution in this respect is £52,300, and the defender's £5,000.

·         The pursuer contributed the £6,000 gifted by her mother in 2002 and the further £29,500 in total gifted subsequently.

·         The financial resources contributed by the parties thus amount to £92,800 in total. These resources were used to buy the land at £6,000 and to pay for the net costs of construction at £83,500. That leaves a balance of about £3,300 unaccounted for from the financial contributions made by the pursuer in particular, which I presume to have been spent on personal matters such as those mentioned at paragraph 69 above. Thus the pursuer's total financial contribution to the purchase of the land and construction of the house is valued at £84,500, and the defender's at £5,000.

·         The increase in value of the land is also, in my view, derived from contributions made by the parties. They would not have been able to obtain the land for something of a knock-down price other than through the defender's brother, who ultimately went through with the sale as he had given his word to do so. There was no suggestion that Mick Murphy would have sold the land to the pursuer alone if she had not been in a relationship with the defender. The pursuer, however, did the work to achieve planning permission. The roles played by the parties were both essential and were mutually interdependent. In my view, the increase in value of £74,000 is attributable to in equal measure to these non-financial contributions made by each of the parties.

·         Then there is the saving of £136,500 on the cost of construction of the house, which was undoubtedly achieved by virtue of non-financial contributions by the parties. The pursuer was the driving force behind the planning and organisation of the self-build process, whereas the defender in my view played a greater part than the pursuer in securing the input of various tradespersons at less than commercial rates. He also offered practical assistance to several of them. Again, it seems to me that the parties' differing contributions were mutually interdependent. The defender could not possibly have tackled the project without the pursuer's organisational drive, but the pursuer could not have achieved such significant cost savings without the defender calling on his connections and calling in various favours. Again, I therefore consider that both parties contributed in equal measure to this element.

·         Finally, the question arises of how the increase in the value of the property since construction should be treated. I do not consider that it can be treated as a "contribution" made by either party. It is a benefit - an economic advantage - that flows from the contributions made by the parties to the other elements of the value of the house.

(83)           On that analysis, the pursuer's contributions to the value of the house are assessed at £189,750 in total[1], and the defender's at £110,250[2]. Having undertaken that analysis, I can now apply the statutory tests to the circumstances of the case. Given the difference in focus between the 2 heads of claim under section 28(2), it is appropriate to consider the relevant factors separately in relation to each claim.

Claim under section 28(2)(a): Application of Statutory Tests

(84)           Has the defender derived any economic advantage from contributions made by the pursuer? (subsection (3)(a)) - Ms Loudon rightly conceded that he had. The defender now owns one half share of a property valued at £350,000, having made lesser contributions to its value than those made by the pursuer. The defender is thus economically advantaged from the combined effect of his own contributions and those made by the pursuer. He is also economically advantaged to the extent of his share of the consequent increase in value of the property although, for the reasons given at paragraph 83 above, I leave that out of account in assessing this factor. It is material, I consider, that although these contributions can be separately enumerated their effect is by definition a shared effect. Had the burden of the contributions to the value of the property been borne equally by the parties, each would have contributed £150,000. Accordingly, my assessment is that the defender has been economically advantaged to the tune of £39,750.

(85)           Is that economic advantage offset by any economic disadvantage suffered by the defender in the interests of the pursuer or of the children? (subsection (5)) - in my view, the defender has suffered little or no economic disadvantage in the interests of either the pursuer or the parties' children. His relevant capital contributions were very much smaller than the pursuer's. It is possible that he may have suffered some economic disadvantage by contributing more in financial terms to the cost of works done at the Roberton Place flat than was realised in any consequent increase in its sale value: but given the paucity of evidence before me, that is now impossible to assess. Most of his contributions to the value of the house were made in other ways. There was no evidence that he suffered any other form of economic disadvantage. I therefore assess his offsetting economic disadvantage at nil.

(86)           Has the pursuer suffered economic disadvantage in the interests of the defender or of the children? (subsection (3)(b)) - there are 2 elements to this factor in the pursuer's submissions. I do not consider that the pursuer has suffered any economic disadvantage in relation to lost opportunity for employment since 2004. That is because, firstly, it was clear on the evidence that (other than child care) the major focus of the pursuer's activities from 2003 until around 2007 was the planning, designing and building of the house. From that significant investment of time and energy she has recouped a significant gain in capital value. Secondly, I preferred the defender's evidence on the question of whether child care commitments would have prevented the pursuer from returning to work during the cohabitation. Thirdly, while the pursuer has undoubtedly shown herself in the past to have a strong work ethic, on the evidence before me any extrapolation from evidence for the period 1991-1998 as to what the pursuer might have been able to earn since 2004 would be largely speculative. And finally, no account was taken of the need to take into account benefits received while not working: from the limited information available to me, it appears that any provision that might otherwise be appropriate in respect of lost opportunity for employment would require to be offset to a very considerable degree.

(87)           The pursuer also claimed economic disadvantage in respect of having made the greater contributions to the value of the house. I note from its wording that the subsection (3)(b) factor is not a mirror-image of the subsection (3)(a) factor. In subsection (3)(a), the question is specifically whether the defender has derived economic advantage "from contributions made by the applicant". In subsection (3)(b), the question is a broader one of whether the pursuer has suffered economic disadvantage in the interests of the defender or of any relevant child. In assessing this factor in those terms, I consider that I have to look at the question of economic disadvantage suffered by the pursuer in overall terms. The value of her contributions to the property exceed the value of her one-half share in it by £14,750. I consider that she has been economically disadvantaged to that extent.

(88)           Is that economic disadvantage offset by any economic advantage the pursuer has derived from contributions made by the defender? (subsection (6)) - Given the nature of the circumstances in this case, with the parties deriving shared benefit from their discrete but interdependent contributions to the property, I consider that any such offset is already accounted for in the assessment of the above factors.

(89)           The court must then "have regard to" these factors in exercising its discretion under section 28(2)(a). In doing so, it is in my view necessary for the court to seek to achieve an outcome that is fair to the parties in the specific circumstances of the case. In this case, to proceed by simply weighing up the defender's subsection (3)(a) economic advantage against the pursuer's subsection (3)(b) economic disadvantage would not necessarily be fair to both parties, because of the different ways in which these factors are expressed and measured. Nor would it be fair to focus attention only on the extent to which the pursuer's contributions exceed the value of her half share in the property: that would deny her the benefit of her share in the increase in value of the property. I consider it fairer to see the property as a joint venture to which the parties made unequal contributions. A capital payment by the defender to the pursuer of £39,750 would in effect equalise the value of their respective contributions to the property. Having regard to the above factors, I will make an order to that effect.

Claim under Section 28(2)(b): Application of Statutory Tests

(90)           Has the defender derived any economic advantage from contributions made by the pursuer? - it was common ground that he has. Since the parties' separation, the pursuer has borne the primary economic and care responsibilities in respect of the children. The defender's economic contribution has been very limited. The defender is thus deriving economic advantage in that the pursuer is taking the lion's share of responsibility for the parties' children.

(91)           Has the pursuer suffered any economic disadvantage in the interests of the defender or the children? - Following M v S, I proceed on the assumption that the status quo will continue to prevail and that the defender's contributions in financial or personal terms will continue to be limited. Standing that, however, I consider several elements of the pursuer's claim to be exaggerated. The children will be highly unusual indeed if they will consent to be sent to a day-care facility right up to the age of 16. It is inconceivable that they will never spend time with family or with friends during school holidays. The pursuer herself will be able to use at least part of her annual leave entitlement to be with the children, whether on organised family holidays or otherwise. I think it also reasonable to assume that Keiran may be able to play some part in the supervision of his younger siblings as he matures, followed in turn by Aidan.

(92)           Any method of quantifying something as broadly expressed as the economic burden of child care must inevitably be fairly rough and ready. I consider it appropriate to allow for paid child care costs up to each child's 12^th birthday, and to discount these by 25% to allow for holidays, family input and time with friends. That produces an annual cost per child of £650 (75% of £870) to be applied in respect of the 3 children for 1 year, 3 years and 7 years respectively: a total of £7,150. Applying the same discount to the pre-school child care costs for Danica produces a figure of £1,080 (75% of £1,440).

(93)           Accordingly, I will order the defender to pay the sum of £8,230 in respect of the pursuer's claim under section 28(2)(b).

Conclusion

(94)           I will therefore order payment of a capital sum of £39,750 in respect of the pursuer's claim under section 28(2)(a), and £8,230 in respect of the section 28(2)(b) claim.

(95)    In making such orders, the court has wide discretion under section 28(7) to specify the timing of the payments required and whether they should be made by instalments. The question of interest must also be considered.

(96)           I have assigned a hearing on the issue of specification of when and how the sums ordered should be paid, and on the questions of interest and expenses.

(97)           Finally, given the legal and factual complexities involved in this action I am content to certify it as suitable for the employment of junior counsel.