Scottish Sheriff Court Decisions

SHERIFFDOM OF GLASGOW AND STRATHKELVIN AT GLASGOW

2014SCGLA20

CA359/09

JUDGMENT

of

SHERIFF PRINCIPAL C A L SCOTT, QC

in the cause

Michael Fox & Agnes Fox

Pursuers

against

United Biscuits (UK) Ltd

Defenders

Glasgow, 17 June 2014.

The sheriff principal, having resumed consideration of the appeal, Refuses same; Adheres to the sheriff’s interlocutor dated 19 December 2013; Finds the pursuers liable to the defenders in the expenses occasioned by 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.

NOTE:-

Pursuers’ submissions

[1]        In opening his submissions, counsel for the pursuers highlighted the fact that the appeal concerned the sheriff’s application of ordinary cause rule 15.7.  He stressed the draconian nature of the power vested in the court to dismiss an action under these provisions.  It was, as counsel put it, “a weapon of last resort”.  It was submitted that the courts had only acceded to such motions in extreme circumstances where there had been unequivocal fault on the part of a pursuer or his agents.  The passage of a significant period or periods of time also required to be involved.

[2]        The present action had been raised approximately one week prior to the expiry of the quinquennium.  Under reference to paragraph [9] in the sheriff’s note, counsel indicated that between 2009 and 2013 there had been something in the order of a “vacuum” when it came to procedure.  Counsel maintained that, whilst the period referred to by the sheriff might be inexcusable, it was not inordinate.  Initially, at least, counsel argued that the sheriff’s application of the rule in question was not a matter of discretion and that it amounted to nothing less than “the strict application of a very high test”.  However, he subsequently departed from that submission and accepted that the sheriff’s decision had been discretionary in nature.  On that basis, counsel argued that the sheriff had exceeded the bounds of his discretion and had thereby erred in law.

[3]        In drawing a comparison between the present action and, for instance, a case involving eye witness evidence, counsel for the pursuers submitted that it was not a case which would “decay over time”.  The passage of time had only a limited impact evidentially.  Counsel contended that it was essential for the defenders to demonstrate how their ability to answer the claim had been prejudiced to the extent that a fair trial could not take place.  He argued that in respect of the delay, the sheriff had made no finding regarding any consequential, identifiable difficulty.

[4]        Counsel criticised the sheriff’s analysis regarding the rot aspect of the claim.  He maintained that it ought not to have been a relevant part of the court’s consideration.  The court was informed that the pursuers had already accepted that their pleadings contained failings in terms of relevancy and specification.  Reference was made to the pursuers’ minute of amendment.  Counsel then embarked upon a review of the salient authorities, viz. Abrahm v British International Helicopters Ltd [2013] CSOH 69; Tonner v Reiach & Hall 2008 SC 1; Ross v Giles Insurance Brokers Ltd (unreported), 22 July 2011; and Peacock Group plc v Railston Ltd [2010] CSOH 173.

[5]        In that regard, counsel accepted that the decision in each case tended to turn upon the particular facts and circumstances involved.  However, he argued that for the sheriff to characterise “a period in excess of 18 months” in the present case as inordinate amounted to a “great leap” when the Scottish authorities were considered.  Ultimately, submitted counsel, the question which required to be addressed was whether or not a fair trial could still take place.

[6]        As between the parties, there had been an established contractual relationship over many years.  There had been lengthy correspondence and vouching in relation to the work carried out.  The main part of the evidence would be given by the pursuers’ surveyor, Mr Gilroy.  The first schedule of dilapidations had been intimated to the defenders following upon an inspection which took place on 13 January 2005.  A period of 9 years had elapsed from the date of the ish and there had been a degree of “fine tuning” in correspondence between the parties.  An impasse had been reached in 2006 and by then, all the dilapidations had been attended to.  The defenders had made an offer to the pursuers in June 2006.  However, that had not been accepted and the action had been raised in November 2009.  Counsel then stated that:

“With the claim not having settled, it would appear that nothing has happened.”

Counsel was not in a position to provide the court with any explanation for the delay or for the inaction on the part of the pursuers.

[7]        A timeline had been produced to which counsel made reference.  He queried whether it could really be said that a fair hearing could not take place.  He stressed the right of the pursuers to have their claim heard and determined by a court.  It was submitted that to remove that right was a draconian step, being a step too far in all the circumstances.

Reply for defenders

[8]        Mr Moffat, for the defenders, stressed the discretionary nature of the sheriff’s decision.  For the court to interfere with that decision, on appeal, the pursuers required to demonstrate that the sheriff had been plainly wrong or had demonstrably strayed from the proper ambit of his discretion.  It was not for the sheriff principal simply to re‑hear the same argument presented at first instance.  Reference was made to the cases of G v G [1985] 1 WLR 647 and B v W 1979 1 WLR 1041.  Mr Moffat submitted that the pursuers’ arguments had failed to identify where the sheriff had gone so plainly wrong as to merit interference on appeal and, to that extent, the appeal ought to fail.

[9]        However, if the court were able to determine some blatant error or oversight on the part of the sheriff, the matter was open de novo for its consideration.  Mr Moffat relied upon the case of Tonner.  Whilst that decision had preceded the creation of the rule in question, it was clear that the formulation adopted in Tonner had been utilised when it came to the drafting of the rule.

[10]      In the present action, Mr Moffat suggested that the cause of action had arisen in 2004 at the ish and that, accordingly, the court was dealing with a delay approaching a 10 year period.  Reference was made to paragraphs 134 and 135 in Tonner.  The court had urged caution when it came to the formula which emerged from the English case of Birkett v James [1978] AC 297.  Inter alia, the court in Tonner was unhappy about undue emphasis being placed upon what would happen at the stage of trial or proof.  The Extra Division of the Inner House referred to what it considered to be a “simple and comprehensive” approach wherein there required, in addition to delay, to be “an added element of unfairness…specific to the particular factual context”.  Mr Moffat submitted that the case of Tonner was where the genesis of the current rule could be found.

[11]      With regard to the case of Hepburn v Royal Alexandra Hospital NHS Trust 2011 SC 20, Mr Moffat submitted that, to the extent that Hepburn seemed to qualify or criticise the test laid down in Tonner, the dicta in Hepburn could be disregarded since the wording favoured by the court in Tonner had been used in the rule whereas the Hepburn approach had not.  It was argued on behalf of the defenders that, when it came to any issue of unfairness, the court ought not to confine its consideration to the question of there being a risk to a fair trial.

[12]      Mr Moffat advised the court that a further, separate litigation was dependent upon the outcome of the present action.  He also pointed out that the defenders themselves had not been in occupation of the subjects prior to the ish.  The test for consideration by the court was, according to Mr Moffat, a broad test of unfairness.  The test required to be applied to the discrete set of facts and circumstances offered up by each litigation.  Mr Moffat noted the circumstances in each of the cases of Ross, Peacock and Tonner itself.

[13]      The sheriff had, submitted Mr Moffat, correctly identified the salient points arising from the court’s decision in Tonner.  Reference was made to paragraph [4] in the sheriff’s note and also to paragraph [6].  The sheriff had correctly observed that progress in the other related action was dependent upon what transpired in the present case.

[14]      Mr Moffat challenged the proposition (advanced by counsel for the pursuers) to the effect that the pursuers had always accepted the criticisms levelled at the relevancy and specification of their averments.  Reference was made to the court’s interlocutor dated 25 March 2010.  With the cause of action arising in 2004, there had been a degree of correspondence in 2005/2006.  Mr Moffat also stressed that the sheriff ought not to be criticised for not taking account of material which had not been placed before him.  Reference was made to the second inventory of productions for the pursuers.

[15]      Nothing more had occurred until November 2009 when the action was raised.  From the beginning of March 2010, the sheriff had expected the pursuers to answer certain calls placed upon them.  At a case management conference on 25 March 2010, the defenders’ request to lodge a note of argument was approved by the court and such a note was thereafter lodged.  At the next calling of the case, on 7 April 2010, a debate was allowed.  The debate was assigned to take place on 23 August 2010.  The diet required to be discharged due to illness.  The fresh diet assigned for 20 September 2010 was also discharged against a background of potential settlement.  However, from that time onwards, as the sheriff records, no efforts were made to progress the action.

[16]      On the date when the case eventually called before the sheriff in December 2013 (originally assigned as a diet of debate because the pursuers had failed to address the issues set out in the defenders’ note of argument), no minute of amendment had been tendered.  Instead, counsel for the pursuers had indicated that he was prepared to stand or fall upon the pursuers’ pleadings in their existing form.  Only during the course of the week prior to the appeal hearing had the pursuers seen fit to tender a minute of amendment.

[17]      The consequence was that certain criticisms in relation to the pursuers’ pleadings had been identified some 4 years previously.  It had taken the pursuers those 4 years, in effect, to “hold their hands up” and accept the deficiencies in relevancy and specification.  There had been no progress, effectively, for 4 years.  Indeed, it was only the pursuers’ failure to resist the defenders’ motion under OCR 15.7 which gave rise to the appearance of a minute of amendment.  All that typified just how the dispute and the litigation had been “managed” by the pursuers.  They had consistently reacted at the very last minute over a period of years of inaction.  The pursuers’ approach throughout those years was always to the prejudice of the defenders.

[18]      Mr Moffat referred to paragraphs [8] and [9] within the sheriff’s note.  In relation to the latter, the precise timing involved actually amounted to something in the order of at least 2½ years.  Indeed, the period involved was actually approaching one of 3 years by the time of the hearing before the sheriff.  There had been absolutely no progress.  It was, according to Mr Moffat, a sorry tale.  The period of time involved was most certainly within the realm of other, similar periods considered by the court in the authorities.  Mr Moffat contended that there was no submission available to the pursuer which could be upheld to support the proposition that the sheriff went plainly wrong in determining that the action should be dismissed.  Nothing in the authorities supported such a conclusion.  However, if the matter did require to be considered de novo, for all the reasons put forward by the sheriff decree of dismissal should still follow.  Mr Moffat then took the court, once again, to the terms of the sheriff’s note at paragraphs [10] to [13].  It was maintained that the approach adopted by the sheriff had been clearly set out in his note and simply could not be criticised.  Moreover, it was not sufficient for this court merely to take a different view from the sheriff.  Therefore, Mr Moffat invited the court to refuse the appeal.  To do otherwise, was wholly unwarranted not least because the pursuers’ case had still to be properly formulated and was the subject of an attempt at amendment even at this late stage.

Response by pursuers

[19]      Counsel for the pursuers explained that the ish had arisen as at 30 November 2004.  However, the cause of action only arose when money was actually expended and where losses had been crystallised.  Therefore, a more meaningful date for the cause of action ought to be June 2006.  Counsel for the pursuers criticised the sheriff’s alleged failure to provide proper reasoning and contrasted the reasoning of Lord Drummond Young in the Abrahm case.

[20]      In the submission of counsel for the pursuers, there required to be a concomitant impact upon the defenders’ ability to answer the pursuers’ claim even if there had been inordinate delay.  Counsel repeated that this was not a case which had deteriorated per se through the passage of time.

Decision

[21]      In my opinion, the arguments put forward by counsel for the pursuers failed to disclose any improper application of OCR 15.7 by the sheriff.  In a sense, the sheriff’s decision was discretionary in nature owing to the permissive language of 15.7.(4).  However, it would be wrong to suggest that, when considering such a motion for dismissal, the court’s discretion is untrammelled.  In a manner similar to motions for decree by default or summary decree the court still requires to have due regard to the terms of the rule before arriving at the outcome permitted by that rule.  Accordingly, Mr Moffat’s primary reliance upon the discretionary nature of the court’s decision in its widest sense does not avail the defenders.

[22]      Ordinary cause rule 15.7.(4) reads as follows:

“In determining an application made under this rule, the court may dismiss the action if it appears to the court that –

(a)  there has been an inordinate and inexcusable delay on the part of any party or any party’s agent in progressing the action; and

(b)  such delay results in unfairness specific to the factual circumstances, including the procedural circumstances, of that action.”

[23]      Therefore, the sheriff, firstly, required to make an assessment in terms of (4)(a).  There can be no doubt that he made such an assessment.  He concluded that there had been an inordinate and inexcusable delay in progressing the action.  I am in little doubt that such a conclusion was justified on the material available to the court.  Secondly, the sheriff required to consider the issue of unfairness in terms of (4)(b).  It is apparent from the terms of his note that he did, indeed, consider that issue and reached the conclusion that the requirement for unfairness in terms of (4)(b) had also been met.

[24]      The sheriff explicitly recognised the draconian nature of the power he was exercising (see paragraph [17] in his note).  Whilst counsel for the pursuers accepted that the delay involved was inexcusable his failure to recognise that it was also inordinate was, in my view, wholly unrealistic.  In the context of the action under consideration, the period involved was truly out of the ordinary order of things.  In that regard, it should be noted that the sheriff had, in fact, understated the passage of time.  As Mr Moffat submitted, the period between September 2010 and the motion enrolled for further procedure in April 2013 amounted to some 2½ years or thereby.  Contrary to counsel’s submissions, I do not accept that the sheriff was somehow required to identify some discrete difficulty caused or created by the delay involved.  I agree with Mr Moffat’s submission that, instead, a broad test of unfairness was involved.  Such unfairness, in terms of the rule, can legitimately arise from the procedural circumstances of the case as well as the specific factual circumstances.

[25]      Any criticism of the sheriff’s reference to the pursuers’ averments anent rot is, in my estimation ill-founded.  Similarly, counsel’s contention that the sheriff failed properly to articulate the reasons for his decision is without merit.  In particular, with regard to OCR 15.7.(5) the consequences for the work of the court itself are dealt with at paragraph [15] in the sheriff’s note and the procedural consequences for the parties are covered within the preceding paragraph.

[26]      Counsel for the pursuers made much of the sheriff’s alleged failure to consider the criterion espoused by the court in the case of Hepburn, viz. whether or not a fair trial remained possible.  However, the sheriff was called upon to determine a motion under and in terms of OCR 15.7.  That rule was formulated subsequent to both the Tonner case and the Hepburn case.  It makes no reference to the “fair trial” test.  Had its inclusion been intended, such inclusion would have been a straightforward exercise.  There would have been no difficulty in formulating such a test within the rule.

[27]      Therefore, whilst (at risk of understating matters) the dicta in Hepburn are otherwise of no little weight in terms of authority, it is plain that, rightly or wrongly, the approach favoured by the judges in Tonner found its way into OCR 15.7 and, accordingly, it is simply wrong to criticise the sheriff for failing to apply a test which does not appear within “the four walls” of the rule.

[28]      However, and in any event, even if I am wrong about that, the terms of paragraphs [15] and [16] in the sheriff’s note indicate that he did, indeed, address the issue of a fair trial.  It is plain, in particular, from the terms of the final sentence in paragraph [16] that the sheriff had it in mind that the problems faced by the defenders in preparing for any proof were, absent suggested solutions by the pursuers, insuperable.  In applying a broader test of fairness, the sheriff in any event gave consideration to the circumstances in which a fair hearing would no longer be possible.

[29]      For completeness, I note that in the case of Hepburn, from paragraph 52 onwards, Lord Carloway expressed certain concerns regarding the decision in Tonner.  Those concerns were focused on an area described by his Lordship as “judge made law” in conjunction with the legitimacy of what was done in Tonner.  However, it is apparent from paragraph 55 in Hepburn that Lord Carloway was reflecting upon the procedural mechanism by which a court is empowered summarily to dismiss an action because of delay.  In the context of the Sheriff Court, OCR 15.7 has since provided such a procedural mechanism and, accordingly, it seems to me that Lord Carloway’s concerns, whilst validly expressed at the time, are no longer of any moment for the purposes of the present appeal.

[30]      For the various reasons articulated within his note, the sheriff concluded that the inordinate and inexcusable delay on the part of the pursuers self-evidently gave rise to unfairness.  He also took account of the procedural consequences, both for the parties and for the work of the court, of allowing the action to proceed.  For my part, I have concluded that the sheriff’s reasoning and the outcome arrived at cannot be faulted. 

[31]      It was agreed that the expenses occasioned by the appeal procedure should follow success.  That being so, I have found the pursuers liable to the defenders in those expenses.