Scottish Sheriff Court Decisions

SHERIFFDOM OF GLASGOW AND STRATHKELVIN AT GLASGOW

 

CA143/12

JUDGMENT

of

SHERIFF PRINCIPAL C A L SCOTT, QC

in the cause

Maclay Murray & Spens

Pursuers

against

 

Andrew Orr

Defender

                                                                        

 

 

 

Glasgow, 19 December 2013.

 

The sheriff principal, having resumed consideration of the appeal, Refuses same; Adheres to the sheriff's interlocutor dated 10 May 2013; Finds the defender liable to the pursuers 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 thereon; quoad ultra Remits to the sheriff to proceed as accords.

 

 

 

 

 

NOTE:-

 

Defender's submissions

[1] For the defender, Mr Cameron, solicitor, took no issue with the material contained within the introduction section of the sheriff's note. He proceeded to narrate the grounds of appeal in full. He submitted that there was, in effect, a single, overarching ground of appeal. It was argued that the sheriff had "overreached himself". He had trespassed on ground which was properly the preserve of the sheriff to whom a proof ought to have been assigned. The sheriff who heard the motion for summary decree had, it was contended, in effect, conducted a "mini proof". He had determined matters which could properly only be dealt with by the proof sheriff.

 

[2] Mr Cameron turned to the law applicable. He accepted, as before the sheriff, that the new ordinary cause rule 17.2(1) applied to consideration of summary decree quoad the defender's counterclaim. That rule embraced a new test of there being "no real prospect of success". That, submitted Mr Cameron, was a liberalised test as envisaged by the Scottish Civil Courts Review chaired by Lord Gill. Mr Cameron submitted that it closely followed what he described as "the English model". The wording in the equivalent rule for England and Wales was, he suggested, identical. Similarly, the wording as far as the tribunal rules were concerned was the same.

 

[3] A body of case law in England had emerged. It dealt with the interpretation and application of the words in question. It was argued that it was reasonable for the Scottish courts to be influenced by the English case law and the employment appeal tribunal case law which had developed in Scotland.

 

[4] Reference was made to the case of Henderson v 3052775 Nova Scotia Ltd 2006 UKHL 21. Whilst that case concerned the earlier formulation of the rule, Mr Cameron maintained that the observations therein were by no means entirely irrelevant. He advanced two propositions regarding summary decree. Firstly, he contended that it required to be exercised in a manner which promoted justice and did not create injustice. Secondly, the judge required to be satisfied that the matter in hand was capable of being determined in the absence of proof.

 

[5] The leading English case was said to be that of Swain v Hillman [2001] 1 All ER 91. Reference was made to the opinion of the Master of the Rolls in Swain. It was suggested that the wording of the rule spoke for itself. The use of the word "real" served to distinguish what might be described as fanciful prospects of success. According to Mr Cameron, the case of Swain was authority for the proposition that any party had a right to have a claim or defence properly considered by the court. The rule was not meant to dispense with the need for a trial or proof where issues were habile of investigation. The court should be slow to deal with a single issue where there ought to be a full hearing involving oral evidence.

 

[6] Reference was also made to the case of ED & F Man Liquid Products Ltd v Patel & Patel [2003] EWCA Civ 47; [2004] All ER (D) 75. Mr Cameron submitted that the court should not conduct a mini trial. Cases which were deemed to be fact sensitive involving documents and disputed witness statements should be determined at a full hearing. The court should also assume that it does not have all the evidence before it on the occasion of the motion for summary decree. It was submitted that all of the foregoing principles were unchallengeable.

 

[7] Mr Cameron characterised the remedy of summary decree as being extraordinary. It deprived a party of his or her usual right to have their contentions dealt with by way of a full, evidential hearing. The summary decree procedure constituted an apparent shortcut but, according to Mr Cameron, it was fraught with difficulty and associated with the danger of injustice. It should not be exercised where there were disputed factual issues. Similarly, where determination of crucial facts was dependent upon oral evidence that, submitted Mr Cameron, was the preserve of the judge hearing the proof. The risk of injustice was so serious as to bring the entire summary decree procedure into disrepute.

 

[8] Mr Cameron then turned to the sheriff's decision itself. In particular, he took the court to paragraph 35 in the sheriff's note. The sheriff's broad reference to "the reasons which had been advanced by Mr Blyth" was criticised as being too vague and too broad. Mr Cameron submitted that there was no way of knowing from the terms of the sheriff's note as to what he was referring to. All that being so, he, Mr Cameron, was constrained to assume that the core issues supporting the sheriff's decision were the "three matters" referred to from paragraph 35 onwards.

 

[9] Mr Cameron made reference to the pleadings in the case and to the terms of an affidavit sworn by Mrs Orr, the wife of the defender. He referred particularly to the terms of the counterclaim. Paragraph 3 of the counterclaim was read out in full. Mr Cameron stressed that the passage concerning the alleged breach of confidentiality referred to a conversation in which Mr Swanson, the pursuers' chief executive, had advised "Mr Salmond and others that the Scottish Government could assume that the development of a new town would now proceed as the defender and his siblings had resolved their dispute with the petitioners."

 

[10] Two points of law were identified by Mr Cameron. It was imperative, he reiterated, that the court should assume that not all the evidence was available as at the hearing of the motion for summary decree. Additionally, it was equally important that recognition be given to the fact that, in this case, Mrs Orr's affidavit had been prepared in response to the motion enrolled by the pursuers for summary decree.

 

[11] The sheriff had assumed that Mrs Orr's affidavit, since it had been framed by a solicitor, had contained all of Mrs Orr's evidence. That was a fallacious approach, submitted Mr Cameron, in that Mrs Orr would unquestionably have been further precognosced prior to any proof, had the counterclaim survived the motion.

 

[12] It was submitted on behalf of the defender that the sheriff's assumption regarding the import of the affidavit, it having been procured by way of a solicitor, was wholly unwarranted. It was argued that the solicitor's involvement added nothing to the matter. Mr Cameron proceeded to read out the terms of Mrs Orr's affidavit. He maintained that, on any view of matters, the terms of the affidavit embraced an allegation quoad breach of confidentiality.

 

[13] Under reference to paragraph 36 in the sheriff's note, Mr Cameron stressed that the breach of confidentiality was directed at the First Minister and others. No 5/14 of process, being a letter dated 9 April 2013 emanating from the office of the First Minister's Principal Private Secretary, had been relied upon by the sheriff. It was submitted that his approach was tantamount to treating that letter as probative. He had regarded the letter as, effectively, unchallengeable. Mr Cameron pointed out that the sheriff had failed to address the potential weaknesses within the letter qua adminicle of evidence. For instance, it was not known whether the Private Secretary had prepared the letter from her own knowledge or from records prepared by a separate third party. It was not known if the Private Secretary had been in contact with the First Minister on the day in question. Similarly, it was impossible to know, for instance, the way in which the First Minister's diary was maintained. Mr Cameron queried whether any last minute changes to the First Minister's schedule would be recorded in the diary or elsewhere.

 

[14] Moreover, Mr Cameron queried the manner in which the minute of the meeting had been taken. It was not known who may have taken the minute. He concluded that the sheriff had treated the letter with, as he put it, "reverential awe". It was submitted, on behalf of the defender, that the sheriff had erred in law in attaching too much weight to the letter. According to Mr Cameron, there was a fundamental issue at stake. The sacred principle of "equality before the law" was in issue.

 

[15] When announcing his decision orally, in the immediate aftermath of submissions, the sheriff had referred to the period between the raising of the action and the date of the motion for summary decree. Mr Cameron pointed out that the minute of amendment procedure had only concluded in or about April of 2013. The counterclaim had been lodged at the end of December 2012. He referred to the answers to the counterclaim. Mr Salmond's presence or otherwise at the meeting, Mr Cameron submitted, only became an issue as at the time of the motion for summary decree. Accordingly, he argued that the timescale referred to by the sheriff was simply wrong. Once again, the sheriff's conclusion was based upon an unwarranted assumption, according to Mr Cameron.

 

[16] It was accepted that it was a legitimate concern of the court to establish whether any action or, indeed, counterclaim was bona fide or was merely a contrivance of sorts. However, Mr Cameron, on behalf of the defender, submitted that the present counterclaim did, indeed, have real conviction, as he put it. He also stressed that an element of longevity was associated with it. The breach of confidentiality had previously been the subject of a complaint to the pursuers. Therefore, the underlying grievance had existed for some considerable time. It was also pointed out that the defender's status for the majority of the action had been qua party litigant and as such he was, relatively speaking, at a disadvantage particularly given that he suffers from dyslexia.

 

[17] Mr Cameron expressed much concern about the terms of the final paragraph within the sheriff's note. In light of the sheriff's comments, Mr Cameron retorted that he was "the last person" to make an ill-considered claim on behalf of a client. He expressed regret that he was being unfairly criticised and submitted that the criticism on the part of the sheriff had been uninformed. He expressed concern that the sheriff's comments might, in some way, reflect badly upon the defender in the action and might also cause the position of Mr Cameron as his solicitor to be compromised.

 

[18] With regard to a disposal, I was invited to recall the sheriff's interlocutor of 10 May 2013 and to allow further procedure in the commercial court, in the first instance, by way of a further case management conference being assigned. Mr Cameron, in the event that his submissions were to find favour with the court, sought the expenses of the summary decree hearing to be awarded in favour of the defender.

 

 

 

Pursuers' submissions

[19] Mr Blyth, for the pursuers, initially contrasted the old summary decree rule with the new. He referred to the Nova Scotia case supra and pointed out that the terms of the old rule had given rise to a high test for any party seeking summary decree. Under the old regime, the court was not concerned with the issue of predicting probability of success.

 

[20] Reference was made to an extract from the report of Lord Gill's Civil Justice Review. In particular, at paragraph 92, the Nova Scotia case was therein referred to. The House of Lords had indicated that:

 

"Before he grants summary decree, the judge has to be satisfied that, even if the defender succeeds in proving the substance of his defence as it has been clarified, his defence must fail."

 

Mr Blyth turned to the related recommendations at paragraphs 102 and 103. He submitted that the final sentence of paragraph 103 was of some significance. In terms, it reads:

 

"Summary disposal should not prevent a pursuer from raising proceedings again on further evidence."

 

Accordingly, a party whose claim has been disposed of in terms of the rule would not suffer significant prejudice because it would be open to that party to raise fresh proceedings if founded upon further, better material.

 

[21] Mr Blyth submitted that the mere existence of a factual dispute between the parties could not and did not preclude the granting of a motion for summary decree. Factual disputes arose in the vast majority of cases. He referred to the case of Swain v Hillman which appeared on the defender's list of authorities. It was submitted that whilst caution required to be exercised by a Scottish court in regard to these English cases, given that different rules of procedure applied, the ability to grant summary judgment, in England, was not dissimilar to the power north of the border. According to Mr Blyth, the terms of paragraph 20 within the Swain judgment did not mean that the judge was precluded from making an assessment on the evidence said to be available.

 

[22] The Court of Appeal case of ED & F was also mentioned by Mr Blyth. He highlighted paragraph 8 therein albeit that he did so in recognition of the fact that the procedure in the case was slightly different. However, it was submitted that the real import of the case was to be found at paragraph 10:

 

"It is certainly the case that under both rules, where there are significant differences between the parties so far as factual issues are concerned, the court is in no position to conduct a mini-trial: see per Lord Woolf MR in Swain v Hillman [2001] 1 All ER 91 at 95 in relation to CPR 24. However, that does not mean that the court has to accept without analysis everything said by a party in his statements before the court. In some cases it may be clear that there is no real substance in factual assertions made, particularly if contradicted by contemporary documents. If so, issues which are dependent upon those factual assertions may be susceptible of disposal at an early stage so as to save the cost and delay of trying an issue the outcome of which is inevitable: see the note at 24.2.3 in Civil Procedure (Autumn 2002) Vol 1 p.467 and Three Rivers DC v Bank of England (No 3) [2001] UKHL/16, [2001] 2 All ER 513 per Lord Hope of Craighead at paragraph [95]."

 

[23] Therefore, Mr Blyth reiterated his submission that the mere existence of a disputed issue or issues of fact did not mean that the case required to proceed to a proof or a trial.

 

[24] The action on the part of the pursuers was an action for the payment of solicitors' fees. The defence was to the effect that (1) the sum sought was excessive and (2) the defender was only liable for one-third of the sum involved. It had been conceded on the part of the defender that, in terms of the principal claim, at least £5,000 was due. At the summary decree hearing, it had been conceded on behalf of the defender that, if the counterclaim were to be dismissed, then summary decree for the sum accepted by the defender ought to pass.

 

[25] Mr Blyth went on to deal with the assertion on the part of the defender regarding a breach of confidentiality all as set out within statement of fact 3 in the counterclaim. The petitioners therein referred to were brothers of the defender and were board members of the company DS Orr & Sons Ltd. A dispute had arisen in connection with the conduct of that company's affairs. As the appeal hearing developed, the issue of whether there had been any material breach of confidentiality emerged as a salient feature in the argument. For his part, Mr Blyth noted the scope of the matter which, according to the defender, ought to have been held in confidence, all under reference to the defender's averments within statement of fact 3 in the counterclaim and also statement of fact 4. It was averred on behalf of the defender that the company owned land and that the land had development value. There could be, it was averred, no development of the land without a board decision from the company. Such a board resolution could not be achieved whilst the dispute which was the subject matter of the Court of Session proceedings was ongoing. Accordingly, the consent of the defender and his siblings to any development proposal was deemed, in itself, to have a "value". It followed that the negotiating position of the defender and his siblings and their intentions as to whether they were willing to give consent or not were confidential.

 

[26] Against the foregoing analysis of those averments, Mr Blyth contrasted what was averred quoad Mr Swanson's utterance directed towards the First Minister and others. It was averred in terms that:

 

"In that informal conversation Mr Swanson advised Mr Salmond and others that the Scottish Government could assume that the development of a new town would now proceed as the defender and his siblings had resolved their dispute with the petitioners."

 

Mr Blyth submitted that the two separate tranches of averment placed on record on behalf of the defender did not equate. What was averred in relation to Mr Swanson was not the same as accusing him of having disclosed the defender's negotiating position regarding any proposed development at Blindwells. Nowhere was it averred that Mr Swanson had indicated to Mr Salmond the basis upon which the dispute had been resolved.

 

[27] In any event, Mr Blyth pointed out that the defender himself averred that:

 

"In fact no such agreement had been reached between the defender and his siblings and the petitioners. Nor had the defender and his siblings intimated to the petitioners that they were minded to resolve the dispute on terms which included their consent to the sale of the land which would allow the development to proceed."

 

It was submitted by Mr Blyth that, at its highest, Mr Swanson might be regarded as having told a "mis-truth" (although that was categorically denied). However, it certainly did not amount to any breach of the confidentiality characterised within statement of fact 3. Even if it had been a breach of confidentiality it was apt, submitted Mr Blyth, to reflect upon the consequences. The defender's averments indicated that, indeed, there appeared to have been no consequences whatsoever. There was a complete lack of averment suggesting that the alleged breach was in any way material. Nowhere was it suggested that the communication of information by Mr Swanson in any shape or form undermined, diminished or adversely affected the negotiating position of the defender.

 

[28] Mr Blyth then proceeded to analyse whether the material or evidence offered up by the defender even supported the averments of breach. There were two questions, he submitted. Firstly, did the affidavit proffered support what Mr Swanson is averred to have said? Secondly, did the affidavit support any suggestion of a communication of the information said to be confidential?

 

[29] Mr Blyth then turned to the terms of Mrs Orr's affidavit and, in particular, paragraphs 4 and 5 therein. Those paragraphs were in the following terms:

 

"4. The First Minister attended the FiSAB meeting at the end as he had been elsewhere. He was present at the post meeting discussion when the question of the delay at Blindwells was raised. Magnus Swanson was also present. Magnus Swanson said with confidence and assurance to the First Minister that the problem was sorted and the project would go ahead.

 

5. The First Minister said that he had heard that before, and asked what was holding the project up. Magnus Swanson said that two members of Lindays Solicitors were sitting on the board of directors of the company which owned the land and the matter was in hand."

 

[30] Mr Blyth submitted that the material contained within the foregoing paragraphs in Mrs Orr's affidavit, did not support the averments on record regarding what Mr Swanson had said nor did it support the suggestion that the information imparted had been confidential as characterised within statement of fact 3 in the counterclaim. Mr Blyth also advanced three separate criticisms regarding Mrs Orr's affidavit. Firstly, he contended that whatever notice the defender did or did not have regarding the pursuers' position in connection with the meeting on 22 November 2011, at the very least, the defender had clear notice of the approach which the pursuers were taking once the discussion at the hearing in May of this year took place. The defender had been placed on notice regarding the sheriff's criticisms in his note. However, there had been no attempt whatsoever to flesh out Mrs Orr's affidavit to provide a more satisfactory or informative picture for the court.

 

[31] There had been no attempt to offer up any other form of evidential material regarding the meeting in question. Mrs Orr's affidavit was simply left as it was in glorious isolation. Mr Blyth submitted that the existence of a specification of documents lodged on the part of the pursuers was worth noting. The specification of documents was No 13 of process and he referred to paragraphs 1D and 1E. The specification had been served on the defender and his agents. However, no documents in response to each of these calls had been provided. It was, accordingly, contended that the court could infer that there was no documentary evidence to support the assertions regarding what was said to have been divulged by Mr Swanson to Mr Salmond. All that was available to the court was Mrs Orr's affidavit. That did not even support the defender's case on record.

 

[32] Secondly, Mr Blyth referred to the minute of the meeting of 22 November 2011. In Mrs Orr's affidavit she claimed to have been present at the meeting. However, the minute made no reference to Mrs Orr being present. That, submitted Mr Blyth, was yet another telling feature when the whole circumstances were looked at. Thirdly, as far as the minute was concerned, there was no suggestion that Alex Salmond had been at the meeting. That was yet another factor to be taken into account by the court.

 

[33] In statement of fact 3 in the counterclaim, it was averred that the defender disclosed certain information to the pursuers regarding the land owned by the company. In relation to those averments, Mr Blyth pointed out that the pursuers had called upon the defender to specify when, where and how the factual material in question had been communicated to the pursuers. All that was said in response was as follows:

 

"On or around 1 June 2011 the defender had a lengthy telephone conversation with the pursuers' solicitor Ms Hilary Kane. In the course of the conversation the defender fully advised Ms Kane about the potential Blindwells development. The conversation took place in the presence of Duncan and Janet Orr who heard the defender refer to the Blindwells." (Answer 4 in the principal action refers).

 

[34] Mr Blyth stressed that the defender's pleadings said nothing more regarding the alleged communication of information to the pursuers. He reminded the court that a specification of documents had been served and yet nothing to vouch the communication of information to the pursuers had been produced by or on behalf of the defender. Mr Blyth submitted that the de quo of the information said to have been confidential simply did not appear to be reflected within the averments quoted supra. Those averments, he argued, were, in any event, wholly unspecific. The complete lack of specification regarding the manner and circumstances in which the information was said to have been imparted to the pursuers was, in the submission of Mr Blyth, another factor calling into question the adequacy of the defender's case when it came to the counterclaim.

 

[35] Mr Blyth contended that, in effect, the court was being asked to believe that the highly sensitive information (as the defender would have it) was communicated to the pursuers during what Mr Blyth described as "one random telephone conversation". Moreover, it was pointed out that nowhere did the defender aver that the individual solicitor, Ms Kane, in turn disclosed the information to Mr Swanson.

 

[36] In passing on to what Mr Blyth described as his fourth criticism of the defender's approach quoad the counterclaim, he indicated that the alleged breach of confidentiality was first alluded to on 31 December 2012 by which time the action had been ongoing for a period of 7 months or thereby. The delay involved, in his submission, cast further doubt on the authenticity of the counterclaim.

 

[37] (Fifth criticism). Mr Blyth explained that the assertion regarding breach of confidentiality was the latest in a number of allegations made by or on behalf of the defender the remainder of which were no longer founded upon. It was suggested that the defender had previously made assertions about four other matters, viz. (i) it was claimed that the pursuers' advice had been wrong in law; (ii) that the pursuers had misappropriated £329,000 from the defender; (iii) that a partner of the pursuers personally benefited from a separate fraud against the defender; and (iv) that the pursuers in representing the defender had a conflict of interest. Mr Blyth contended that all this was indicative of a dilatory approach which the summary decree rule was designed to confront. It was submitted that all this cast doubt on the authenticity of his claim.

 

[38] (Sixth criticism). Mr Blyth also founded upon the delay involved in the defender's termination of the pursuers' services. The defender's wife, according to her affidavit, had known about the alleged breach of confidentiality on the occasion it is said to have taken place, viz. 22 November 2011. Nevertheless, notwithstanding the defender's apparent contention that the alleged breach in question was so significant and so material as to justify his need to instruct fresh legal advisors, his reaction to that did not manifest itself until some 4 months later.

 

[39] (Seventh criticism). The sheriff's decision giving rise to the interlocutor of 10 May 2013 inter alia noted that the only evidence produced in support of the allegation about breach of confidentiality came from the defender's wife. The sheriff made reference to this in the penultimate paragraph of his note. Mr Blyth submitted that, with the passage of time, had further, separate evidence to support the allegation existed, one would have expected to have had sight of it in advance of the appeal hearing. However, as things stood, despite the passage of almost 6 months, no further adminicles of evidence had been offered up by a defender who still maintained that the proper course was for the counterclaim to be the subject of proof. In the submission of Mr Blyth, the absence of further evidence or material designed to support the allegation of breach of confidentiality was damning.

 

[40] (Eighth criticism). Reference was made to Mr Swanson's affidavit, being 5/6 of process and, in particular, paragraph 5 onwards:

 

"I have no knowledge of the Defender and his siblings, or any dispute at the Court of Session involving the Defender and his siblings. Likewise I have no knowledge of any land at Riggonhead or any proposed new town on the land.

 

6. While I attended a meeting of the Financial Services Advisory Board at St Andrews House in Edinburgh on 22 November 2011 ('the meeting') I did not speak with the First Minister, nor did I discuss the Defender or his siblings or any issue concerning land at Riggonhead.

 

7. The First Minister was not in attendance at the meeting. The First Minister was, as I understand, due to attend the Meeting, but sent his apologies. My recollection is that the First Minister did not arrive late to the meeting. Following the meeting, there was a brief buffet style lunch for the attendees. I attended the lunch. During this lunch, I recall that I spoke to Fergus Ewing and the team from the Scottish Office, and various other Financial Services Advisory Board members. I do not recall the First Minister being present at the lunch. The lunch was attended by a fairly large group with a number of civil servants and Board members, and I was not the last to leave. It is possible that the First Minister could have popped in to the lunch without me seeing him."

 

Mr Blyth submitted that considerable weight ought to be attached to Mr Swanson's affidavit. Moreover, it was pointed out that there was no independent or objective adminicle of evidence linking Mr Swanson with the defender.

 

[41] (Ninth criticism). It was argued that, perhaps, the main difficulty regarding the defender's counterclaim was the position of the First Minister, Alex Salmond. Mr Blyth explained that the specification of documents, No 13 of process, had been served upon Mr Salmond's office. He referred to the letter, No 5/14 of process, as being consistent with the minute of the meeting on 22 November 2011 and with the recollection of Mr Swanson. It was submitted that the only thing that was inconsistent with the other adminicles of evidence was the recollection of Mrs Orr and, in terms of the specification of documents, nothing else had, of course, been produced to support that recollection. Mr Blyth stressed that the letter from the First Minister's Principal Private Secretary had been produced in response to the specification of documents. Whilst the letter itself may have been signed on her behalf, the certificate attached to it had been signed by the PPS.

 

[42] Reference was also made to No 5/23 of process which was a letter to the pursuers from the PPS dated 18 June 2013. Mr Blyth submitted that if there were a dispute as to fact, one aspect of that dispute was whether Mr Salmond attended the meeting on the date in question and whether the information referred to by the defender had been imparted. It was maintained that the two individuals best placed to answer those questions were Mr Salmond and Mr Swanson. Both were as clear as they possibly could be that the discussion which the defender contended for did not take place.

 

[43] On the basis of the foregoing criticisms of the defender's counterclaim, Mr Blyth posed the simple question, "What purpose a proof?" He submitted that the sheriff's approach to matters had been entirely correct and that the appeal should be refused. Even if the sheriff's approach to his decision had been wrong in some way, nevertheless, the matter now being at large on appeal, the various factors founded upon by Mr Blyth when taken in their totality comfortably merited the same conclusion which the sheriff had reached, viz. that the defender had no real prospect of succeeding at proof.

 

Defender's reply

[44] Mr Cameron was afforded the opportunity to respond to Mr Blyth's submissions. He began by asserting that the purpose of a proof would be to allow the defender to present his case and to disprove the statements of Mr Salmond and Mr Swanson. While Mr Cameron recognised that the arguments on appeal had, to a large extent, focused upon the averments of breach of confidentiality, his interpretation of the defender's pleadings differed from that of Mr Blyth. Mr Cameron accepted that the alleged breach gave rise to no consequence other than the erosion of mutual trust and confidence as between client and solicitor. However, he maintained that that alone was sufficient to constitute a material breach of contract which, in the present counterclaim, sounded in damages given, particularly, the defender's requirement to instruct new solicitors.

 

[45] In dealing with Mrs Orr's affidavit, under reference to paragraph 4 therein, Mr Cameron stressed that when the deponent referred to the problem being sorted, the problem she was referring to was the dispute between the defender and his siblings all as referred to in statement of fact 3 in the counterclaim. It was submitted that the defender's case on breach of confidentiality was adequately specified. The issue involved consideration of whether the innocent party (viz. the defender) was entitled to resile from the contract in light of the breach complained of. It was argued that any breach of confidentiality was a material breach of the various terms implied into a contract as between solicitor and client. In any event, Mr Cameron urged the court not to form any view upon the materiality of the breach alleged without hearing evidence.

 

[46] Regarding Mr Blyth's reference to earlier complaints by the defender directed at the pursuers, Mr Cameron indicated that he was only aware of one previous allegation which had been dismissed some time ago and that related to the question of conflict of interest. He submitted that there was no inaccuracy regarding what had been pleaded on the defender's behalf. He criticised the proposition that weight ought to be afforded to Mr Swanson's affidavit merely because he happened to be, for instance, a lawyer of perceived standing within the profession. Mr Cameron submitted that Mr Swanson had a strong motivation for denying the essence of the defender's counterclaim since otherwise he, Mr Swanson, would be exposed to some form of disciplinary procedure. Mr Cameron adhered to his motion that the appeal should be allowed and the case remitted back to the sheriff for further procedure in due course.

 

Discussion

[47] In the course of the debate, Mr Blyth suggested that the position adopted on behalf of the defender involved the proposition that where any "issue to try" could be identified, an inquiry into the facts ought to follow and, consequently, rule 17.2 could not be applied by the court. I expressed a preliminary observation to the effect that the defender's position was possibly habile of being expressed in less categorical terms. On more mature reflection, and having reviewed parties' submissions, I now accept Mr Blyth's suggestion. I agree with his general submission (as recorded at paragraph [23] supra) that the mere existence of a disputed issue or issues of fact does not mean that a case requires to be determined by way of a proof. Were it otherwise, the rule regarding the granting of summary decree would be rendered redundant.

 

[48] Any disputed issue of fact might be characterised as being habile of investigation by way of proof. However, that is nothing to the point. In applying the rule regarding summary decree, in my view, the court requires to undertake a qualitative assessment of the case which is claimed to have no real prospect of success. In most situations, that will involve scrutiny of the pleadings and analysis of any material said to be the foundation for a party's case. In this connection, I respectfully adopt what Lord Justice Potter had to say in the ED & F case. (See paragraph [22] supra).

 

[49] The sheriff concluded that the counterclaim had no real prospect of success. The note of appeal criticised that conclusion for various reasons as did Mr Cameron in the course of his submissions. The counterclaim rests upon the existence of a conversation between the pursuers' chief executive, Mr Magnus Swanson, and the First Minister, Mr Alex Salmond, in the course of which it is claimed that Mr Swanson divulged information confidential to the defender, his siblings and the pursuers as their solicitors. The defender, in the counterclaim, pleads that the alleged breach of confidentiality was tantamount to a material breach of contract; that he and his siblings were thereby entitled to rescind their contract with the pursuers; and that the defender reasonably required to instruct a new firm of solicitors to act on his behalf. The new solicitors, it is averred, required to incur time and expense in duplicating work previously undertaken by the pursuers and the defender claims damages in respect of the cost of that work and in respect of the inconvenience arising from the need to instruct new solicitors.

 

[50] It will be seen from the passages of averment quoted at paragraphs [26] and [27] supra, that the defender, inter alia, offers to prove that the dispute (which apparently precluded the development of a new town) had not been resolved. On the hypothesis that such detail was confidential, the defender, via the counterclaim, maintains that there was a breach of confidentiality by Mr Swanson. However, in a contrasting factual averment the defender pleads that Mr Swanson said that the dispute had been resolved. It follows that, on any view of matters, the underlying factual basis for the alleged breach of contract founded upon by the defender does not exist. His own averments do not inform a case which relies upon a breach of confidentiality in terms of what Mr Swanson is alleged to have told the First Minister. I agree with Mr Blyth's submission that, at its highest, Mr Swanson, on the defender's own averments, might only be viewed as having uttered a "mis-truth". Crucially, the utterance condescended upon in statement of fact 3 could not amount to a breach of confidentiality. The fact held in confidence by the defender and others was that the dispute had not been resolved. For Mr Swanson to have stated that it had been resolved would not have disturbed the integrity of that confidence.

 

[51] Nor do I regard the scrutiny of the defender's pleadings in the counterclaim as being a purely semantic exercise. The sheriff in his note highlighted the need for the evidence to be fully investigated before the counterclaim was framed, where the averments in question amount to an allegation of professional misconduct. For my part, I would also highlight the need for precision of averment where a case stands or falls on the import of what an individual is claimed to have said in such a context.

 

[52] It is also legitimate, therefore, to recognise that, as Mr Blyth submitted, what is averred in relation to Mr Swanson does not equate with the accusation that he had disclosed the defender's negotiating position regarding any proposed development located at Blindwells. There are no averments to the effect that Mr Swanson had divulged to Mr Samson the basis upon which the dispute had been resolved.

 

[53] There is, in my view, a further, fundamental difficulty for the defender. The material recorded at paragraphs 4 and 5 within Mrs Orr's affidavit neither supports the averment in the pleadings about what Mr Swanson is supposed to have said nor does it substantiate that the information said to have been imparted had been confidential, all as averred in statement of fact 3 in the counterclaim. This was a matter to which the sheriff, in my view correctly, attached particular significance.

 

[54] It should not be overlooked that Mrs Orr is the only source of evidence informing the counterclaim. Mr Salmond's presence at the meeting on 22 November 2011 is not vouched by any other potential witness or source. Indeed, the contrary is affirmed by reference to the Minute of the Meeting, the letter dated 5 April 2013 (No 5/14 of process) and the letter dated 18 June 2013 (No 5/23 of process), the latter of which makes it clear that the First Minister was away from Edinburgh on 22 November 2012. Additionally, to a large extent, the affidavit from Mr Swanson excludes Mr Salmond's presence on 22 November 2012. It unequivocally rules out the existence of any discussion between the two men. The sheriff attached "great weight" to the letter from the First Minister's Private Secretary, No 5/14 of process. He was certainly entitled to attach weight to it in seeking to evaluate whether the defender's case carried with it any real prospect of success.

 

[55] Ground of appeal 6 specifically challenges the sheriff's approach. However, I do not regard that challenge as being justified. I have already outlined the case which the defender seeks to make in terms of his counterclaim. In the context of the rule 17.2 evaluation process, it does not, to my mind, follow that the party advancing the motion for summary decree will necessarily require to prove the tenor of documentation upon which he founds. It is for the presiding sheriff to determine whether, in the exercise of his own judgement, any particular document can be afforded weight or otherwise. In the course of his submissions, nothing was said by Mr Cameron which led me to regard the sheriff's approach to the letter (5/14 of process) as wrong in any way. In any event, when the letter is taken along with No 5/23 of process, together with the Minute of the Meeting and Mr Swanson's affidavit, the sufficiency of the material which serves to cast doubt upon the foundation for the counterclaim is comfortably exposed.

 

[56] Not only is Mrs Orr's affidavit the only source of evidence informing the counterclaim, it has remained in its existing form at least since the early summer of 2013. Similarly, no other adminicles of evidence supporting the counterclaim have emerged and that notwithstanding the pursuers' lodging of the specification of documents, No 13 of process. Therefore, in my view, criticism levelled at the sheriff under ground of appeal 2 is ill-founded. For him to have presumed that when it came to the defender's counterclaim the affidavit from Mrs Orr "was the totality of evidence which would be led at proof" appears to have been the correct presumption to make. As Mr Blyth submitted, it was reasonable for the sheriff to infer that there was no documentary material to support the claim regarding Mr Swanson's dialogue with the First Minister. The only document produced by the defender is his wife's affidavit and, as already discussed, that does not support the averments in the counterclaim. In a not dissimilar vein, I also consider Mr Blyth's "seventh criticism" of the defender's approach to be valid.

 

[57] In any event, for Mr Swanson to have engaged in a breach of confidentiality, he firstly would have required to become intimately acquainted with the detail involved in the information said to have been confidential. In this connection, the defender appears to rely on his telephone conversation with Ms Kane on or around 1 June 2011. At their highest, the averments suggest that Ms Kane had been fully advised "about the potential Blindwells development". Unfortunately for the defender, that does not reflect the de quo of the information said to have been confidential. Moreover, the defender's pleadings are silent as to how any sensitive information regarding the defender's bargaining position quoad consent or otherwise in relation to the sale of the land had been imparted to Mr Swanson. I accept the force underlying Mr Blyth's submissions as recorded at paragraphs [34] and [35] supra.

 

[58] Mr Blyth's fourth, fifth, sixth, eighth and ninth "criticisms" have still to be mentioned by me. Suffice it to say that they are, in my opinion, the sort of features to which the court is entitled to attach weight in considering whether the motion for summary decree quoad the counterclaim is well-founded. Once these elements are factored into the overall qualitative equation along with my earlier observations from paragraph [47] supra onwards, I am in no doubt that the justification for the sheriff's decision has been amply established. The conclusion that the counterclaim had no real of prospect of success was correct, whatever discrete challenge there might be to the sheriff's methodology.

 

[59] All of the foregoing is sufficient to dispose of the appeal in favour of the pursuers. However, it is, in my view, only right to make mention of the issue of material breach of contract. If my own analysis of the defender's pleadings is correct, the counterclaim falls far short of establishing any breach of contract on the part of the pursuers. However, if that analysis is wrong, on the hypothesis that a colourable breach of confidentiality on the part of Mr Swanson has been averred, an issue arises as to whether the breach can be regarded as material.

 

[60] In his submissions, Mr Blyth highlighted the fact that even if Mr Swanson's alleged utterance amounted to a breach of confidentiality, there were no identifiable consequences. Of course, as Professor McBryde points out at paragraph 20-94 in the third edition of his work on The Law of Contract in Scotland, the question which ought to be addressed is the nature of the breach rather than its consequences. (See the opinion of the court delivered by Lord Morison in Scotmore Developments Ltd v Anderton 1996 SC 368). However, Lord Morison did express the view that the consequences maybe be relevant as illustrating the materiality of the breach or otherwise. (See page 373B to C). Under reference to Gloag, Contract 2^nd Edn page 602, the Second Division in Scotmore also observed that it was well-settled that the breach of a condition which "goes to the root of the contract" justifies rescission.

 

[61] Mr Cameron submitted on behalf of the defender that any breach of confidentiality in the context of solicitor/client relationships would amount to a material breach. Whilst it is unnecessary for me to express any concluded view on this issue, I do entertain significant doubt over whether the nature of the breach of confidentiality which the defender purports to found upon might truly be characterised as a material breach of contract. That doubt flows from the fact that, whatever was said, was entirely inconsequential and that taking the defender's pleadings at their highest. Moreover, the decision by the defender, after some months, to rescind the contract with the pursuers and to instruct new solicitors might well be regarded as coming too late in the day.

 

[62] In conclusion therefore I have adhered to the sheriff's interlocutor of 10 May 2013. With regard to Mr Cameron's submissions, particularly at paragraphs 4 to 6 supra, in the whole circumstances, I do not consider that the court's power to grant summary decree has been exercised in such a manner as to create any injustice. Proper consideration by the court of a party's claim is not always commensurate with the proposition that the claim, or defence for that matter, must be aired in the context of a proof. There was no question of the sheriff having conducted what was referred to as a "mini trial" nor do I consider that any such procedure was invoked in terms of my own deliberations following the appeal.

 

[63] The case of Henderson concerns the earlier formulation of the rule and, as such, the court's observations therein are, with respect, of limited value. In contrast, the English cases of Swain and ED & F were, of course, dealing with a similar formulation to that which now appears in OCR 17.2. What can be taken from those two cases is the general proposition that, in considering a motion for summary decree, the court ought to direct itself as to whether there is a "realistic" as opposed to a "fanciful" prospect of success. In my view, the observations of Lord Hope in the Three Rivers case are not without significance:

 

"...it may be clear as a matter of law at the outset that even if a party were to succeed in proving all the facts that he offers to prove he will not be entitled to the remedy that he seeks. In that event a trial of the facts would be a waste of time and money, and it is proper that the action should be taken out of court as soon as possible. In other cases it may be possible to say with confidence before trial that the factual basis for the claim is fanciful because it is entirely without substance. It may be clear beyond question that the statement of facts is contradicted by all the documents or other material on which it is based. The simpler the case the easier it is likely to be take [sic] that view and resort to what is properly called summary judgment." [2001] 2 All ER 513 at 542J.

 

[64] In my opinion, the alleged foundation for the defender's counterclaim is very straightforward, albeit flawed. It is clear that the counterclaim is, in effect, contradicted by all of the documentation in the case, with one exception, viz. Mrs Orr's affidavit which, in itself, does not support the counterclaim. Therefore, whether the counterclaim falls to be characterised as fanciful, flawed or entirely without merit the court's conclusion must remain the same. It has no real prospect of success and summary decree dismissing the counterclaim is the just and correct disposal. The appeal is refused.