Scottish Sheriff Court Decisions

SHERIFFDOM OF GLASGOW AND STRATHKELVIN AT GLASGOW

 

CA186/12

2015SCGLA3

 

JUDGMENT

of

SHERIFF PRINCIPAL C A L SCOTT, QC

in the cause

Montagu Evans LLP

Pursuers

against

 

Luigi Romano

Defender

                                                                        

 

 

 

Glasgow, 12 January 2015.

 

The sheriff principal, having resumed consideration of the appeal, refuses same; adheres to the sheriff’s interlocutor dated 2 July 2014 and that of 23 July 2014; finds the pursuers liable to the defender 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; certifies the appeal as suitable for the employment of junior counsel.

 

 

 

 

 

NOTE:-

 

Pursuers’ submissions

[1]        In opening his submissions, counsel for the pursuers observed that, substantially, the evidence in the case was not a matter of dispute between the parties.  The appeal itself was concerned with matters of construction.  In relation to the first ground of appeal, counsel conceded that the pursuers could not prove that they were the effective cause of the ultimate sale of the subjects to Land Securities.  When it came to the second ground of appeal, counsel’s submission was to the effect that the pursuers were reliant upon quantum meruit as a “fall-back position”.

 

[2]        Counsel advised that the appeal was only concerned with questions A and D as set out on page 2 of the note of appeal.  Should the answer to question A be in the negative, there was, submitted counsel, a need for the court to consider questions B and C.  Should the appeal be upheld, counsel stated that, as a matter of agreement, there ought to be a remit back to the sheriff to deal with questions B and C.  However, under reference to item C on the second page of the note of appeal, counsel confirmed that the effective cause of the transaction was no longer a live issue.

 

[3]        Counsel proceeded to reflect upon the sheriff’s judgment, whilst reiterating that the facts of the case were essentially beyond dispute.  The parties were agreed that a professional relationship existed between them prior to 1999.  Before then, the parties had, according to counsel for the pursuers, also enjoyed a fairly relaxed contractual relationship.  Fees in respect of work carried out by the pursuers had been agreed on a case by case basis.  Whatever the precise nature of the parties’ contractual arrangement, it was in place well before the property market crisis which had arisen in 2008.  Counsel referred to paragraph [10] at page 7 of the sheriff’s note.  There was no dispute that until the property market crisis, there had been what counsel characterised as a “fairly relaxed arrangement” between the parties.

 

[4]        The property which, to all intents and purposes, constituted the subject matter of the present action was located at 209 Buchanan Street, Glasgow.  Broadly speaking, the property was at the Queen Street Station end of Buchanan Street.  It was agreed that in or around November 1999, the defender sought the advice of the pursuers in connection with Glasgow City Council’s “earmarking” of the subjects for re-development etc.  Counsel referred to article and answer 4 of condescendence.  In the pleadings, the defender did not admit that the pursuers entered into discussions with co-proprietors but, at proof, this had not been disputed.

 

[5]        The block in question had been subject to a (first) compulsory purchase order.  Counsel referred to a tortuous history of matters.  GCC were to enter a scheme along with Atlas Investments Ltd.  There was no dispute that the pursuers had undertaken work assisting the defender in regard to the first CPO.  Work had also been done in relation to a second CPO.  Counsel referred to answer 5 in the record and to the various admissions which appeared therein.  He submitted that the live issue which remained was whether the defender was contractually liable for the work carried out by the pursuers.  Counsel posed the question, “Was the work carried out on a contingency basis or were fees due?”  If there had been a contingency then the sheriff’s judgment required to stand.  However, counsel indicated that he would then have further submissions to make in regard to quantum meruit.

 

[6]        As at 1999, there had been no formal fee arrangement between the parties.  Thereafter, the pursuers’ Mr Colin Whyte had issued the letter dated 6 August 2004, No 5/1 of process.  Counsel read out the various terms set out in that letter.  He contended that those terms had been verbally accepted on behalf of the defender.  Counsel characterised the scope of the foregoing letter as constituting the first agreement between the parties.

 

[7]        By 2008, the pursuers had realised that more work was required.  That realisation generated the email traffic disclosed in the first inventory of productions for the pursuers and culminating in the email from Colin Whyte to Giancarlo Romano dated 18 June 2008 (11.48 hours).  Counsel characterised these emails as constituting the second agreement between the parties.

 

[8]        Counsel observed that the sheriff had made eleven findings in fact.  Findings in fact 1 to 4 involved the sheriff’s acceptance that the pursuers carried out a great deal of work between 1999 and 2010, all according to counsel for the pursuers’ reading of the judgment.  Findings in fact 5 and 6 embraced the sheriff’s conclusion that, whilst there had been no agreement between the parties at the outset of dealings, there followed two fee agreements constituted respectively by No 5/1 of process and by 5/2 to 5/7 of process.  For the purposes of the appeal, counsel for the pursuers indicated that his submissions would amount to a construction of those emails.  Finally, findings in fact 7 to 11 inclusive involved the sheriff dealing with the history of matters subsequent to the second fee agreement.

 

[9]        Counsel observed that the sheriff ultimately assoilzied the defender and held that the sale of the subjects was not an event entitling the pursuers to the payment of commission or of any sum calculated in terms of Ryde’s scale.  The sheriff also held that the pursuers were not entitled to what was contended to be a reasonable fee for work done between 1999 and 2008.  Counsel submitted that when properly construed, the second fee agreement meant that payment was, indeed, due to the pursuers.  Were that not so, the pursuers still adhered to their quantum meruit case.

 

[10]      Returning to the pursuers’ first inventory of productions, counsel for the pursuers posed certain discrete questions:

 

(a)         On a proper construction of those emails, did they provide that the pursuers were only entitled to a 1% fee etc in the event of a sale of the subjects to Atlas or the existence of a compulsory purchase order by GCC?  (For the purposes of the appeal, it was conceded that neither of the foregoing eventualities had come to pass).

 

(b)        Absent any implied term, were the pursuers only to be entitled to a fee where they were the effective cause of the transaction?

 

(c)        In the event that the pursuers were not entitled to any fee calculated as per the email mechanism, were they entitled to be paid on a quantum meruit basis?

 

[11]      At proof, the pursuers’ solicitor had made reference to the West Bromwich Building Society case.  That, counsel pointed out, was not an authority which featured in the present appeal.  He submitted that the case of Rainy Sky SA & Others v Kookmin Bank 2011 UK SC 50 was the authority upon which the appeal largely fell to be determined.  Counsel reiterated that the core issue was the manner in which the emails fell to be construed.

 

[12]      The court was invited to consider the background circumstances of the case.  Counsel suggested that three time periods were involved, viz. (i) 1999 to 2004 (pre‑agreement); (ii) 2004 to 2008 (first agreement); and (iii) 2008 to 2010 (second agreement).  Counsel for the pursuers referred to the second and fourth findings in fact made by the sheriff.  He submitted that, on the basis of those findings, it was clear that the parties’ contractual relationship did not just begin with the first fee agreement.  There had been a discernible relationship from 1999 onwards.  It being the case that an initial instruction took place in 1999, counsel maintained that there must have been a contract formed around that time.  Alternatively, the pursuers had acted in some way as standing advisors to the defender but counsel pointed out that there had been no evidence to that effect.

 

[13]      In the first period of time referred to supra, there had been no contingencies.  It was accepted that further conditions would have required to be implied into the parties’ contract, ie for ordinary care to be exercised etc.  Counsel argued that, in approaching matters, the sheriff should have paid greater attention to that first period of time.  In that connection, counsel referred to the case of Rainy Sky.

 

[14]      Counsel sought to place in focus the sheriff’s assessment as to the effect of the first fee agreement under particular reference to finding in fact 5.  That finding is in the following terms:

 

“At the time of the initial instruction the parties did not enter into any fee agreement.  On 6 August 2004 the pursuers wrote to Giancarlo Romano with a fee proposal (5/1) which was accepted by Mr Romano junior on the defender’s behalf.  This first fee agreement expressly provided that it was to endure for 18 months.”

 

[15]      Perhaps, as a glimpse of the obvious, counsel for the pursuers asserted that the foregoing finding in fact meant that a first fee agreement was, therefore, in existence.  He returned to No 5/1 of process, the letter dated 6 August 2004.  In his submission, that letter was a somewhat “odd” document.  Its terms read as if nothing had taken place between 1999 and 2004.  Nevertheless, the letter did set out the nature and extent of the work envisaged.  Counsel referred to (a) and (b) in the second paragraph of the letter.  There was, he submitted, an important caveat; the letter assumed that sale terms would be agreed and implemented within 18 months.  In contrast, as a matter of fact, it was conceded that they were not agreed within such a period.  The letter did not go on to provide for what should happen after the 18 month period had expired.  It was counsel’s submission that the letter of 6 August 2004 simply consolidated the position between the parties regarding payment and other associated issues.

 

[16]      With regard to the second fee agreement, at the proof before the sheriff, it had been submitted on behalf of the pursuers that the emails, Nos 5/2 to 5/7 of process, constituted a contract regarding fees to be received on a consensual sale of the subjects or the creation of a compulsory purchase order over the subjects.  Counsel went on to examine, in detail, the various items forming the pursuers’ first inventory of productions.  He submitted that the second fee agreement had come about via a process of negotiation between the parties.  With regard to 5/2 of process, counsel pointed out that an immediate payment to account had been requested by the pursuers but had been rejected by the defender.  Counsel for the pursuers, once again, highlighted the parties’ divergence as to what was meant by the various emails.  He acknowledged the defender’s position to the effect that the emails gave rise to no liability for the payment of fees.  In contrast, counsel urged the court to prefer the pursuers’ approach which was to the effect that there was a clear liability on the part of the defender to make payment of fees.

 

[17]      Counsel suggested that the defender’s position at proof amounted to claiming that the effect of the second fee agreement was to render all fees due by the defender to the pursuers for the period 1999 to 2008 to be contingent fees, in other words, dependent upon the sale of the subjects and the pursuers having been the effective cause of such a sale.  The court was invited to look again at the terms of No 5/3 of process, the email from Colin Whyte to Giancarlo Romano dated 3 June 2008 (16.51 hours).  Counsel submitted that there had been no question of the pursuers writing off fees prior to the date of this email.  He submitted that a proper construction involved the proposition that on the sale of the subjects to Land Securities, the pursuers were entitled to a 1% fee and, potentially a Ryde’s scale fee, regardless of the identity of the purchaser.  It was contended on behalf of the pursuers, that a reasonable construction involved the payment of fees not being contingent upon anything apart from a sale.

 

[18]      The second fee agreement, counsel maintained, equated to a “roll-up” agreement of anything that went before it along with a recognition that, if the pursuers were to be paid, they would require to wait until the subjects were sold.  It was a roll‑up agreement because, going back to 1999, the parties did not envisage that any disposition of the subjects would be held up by (a) CPO procedure (all of which had ended up in the House of Lords) and (b) the world economic meltdown in 2008.

 

[19]      Supervening events had followed.  There was no sale and yet the pursuers continued to carry out work for the defender.  The pursuers had, in effect, rolled up fee liability and inserted it into the second fee agreement in 2008.  The defender’s position was that payment of any fees was contingent upon the pursuers being the effective cause of the sale transaction.

 

[20]      Counsel for the pursuers referred to the business efficacy rule and to McBryde on Contract (3^rd Edn) at pages 266 to 270.  The event which the defender claimed had to take place in order to trigger his liability to make payment to the pursuers involved the pursuers being the effective cause of the ultimate sale to Land Securities.  Counsel submitted that, on a reasonable construction of, in particular, the second fee agreement, it was quite obvious that the purpose of that agreement was to ensure that the pursuers got paid for work undertaken, but that, given the economic reality of matters, the pursuers had been prepared to await payment until the defender received proceeds from the sale of the property.

 

[21]      Counsel for the pursuers then went on to submit that should the court be unclear as to the precise basis for payment it would be open to the court to hold that the pursuers were contractually entitled to payment but that proof of the extent to which payment fell to be made would be determined on a quantum meruit basis.  In terms of the various emails, counsel for the pursuers recognised that the defender did take issue with what work had been carried out and in respect of the worth of that work.

 

Defender’s submissions

[22]      In reply, counsel for the defender characterised the pursuers’ position on appeal as being straightforward.  In other words, the pursuers simply founded upon a sale having taken place at some point in time.  However, on the facts, the sale in question had been negotiated by the defender’s son and involved a disposal to Land Securities.  It was submitted that the pursuers’ involvement had tailed off during the summer of 2009.  Counsel for the defender queried what would have occurred had the defender then approached another firm of surveyors?  The defender, counsel suggested, might have then been liable for two sets of fees.

 

[23]      Counsel submitted that, having heard all the evidence in the case, the sheriff had thereby secured a particular advantage when it came to understanding the whole picture.  The sheriff held that there had been a contract but that it was contingent upon either a sale of the subjects to Atlas or upon the occurrence of a compulsory purchase order.

 

[24]      In terms of authorities, counsel for the defender founded upon the cases of Henderson v Foxworth Investments Ltd & Another [2014] UK SC 41 at paragraphs 58 to 68 and McGraddie v McGraddie 2013 SLT 1212 at paragraphs 1 to 4.  In other words, counsel founded upon Lord Reed’s observations as to the circumstances in which an appellate court might properly interfere with the findings of the court at first instance.  Counsel for the defender also made mention of the case of Coyle v Lanarkshire Health Board [2014] CS1H 78.  He submitted that the case of Coyle had involved an attempt on the part of the reclaimers to narrow the Lord Ordinary’s findings.  That attempt, counsel maintained, had been rebuffed by an Extra Division of the Court of Session.  He referred, in particular, to paragraph [18] within the judgment which was in the following terms:

 

“Senior counsel for the reclaimers did not shrink from accepting the high test he required to meet to persuade the court that the Lord Ordinary was ‘plainly wrong’ in the sense explained by Lord Reed.  He sought to persuade us to that effect by inviting us to consider in detail certain parts of the transcripts of the evidence, particularly the evidence of Dr Anderson.”

 

Accordingly, counsel for the defender argued that, in the present case, the sheriff ought to have been afforded a degree of deference in accordance with the whole circumstances.

 

[25]      The defender’s list of authorities under the heading “Contract Formation/Construction” included the cases of Rainy Sky SA v Kookmin Bank [2011] 1 WLR 2900 at paragraphs [14] to [30]; Grove Investments Ltd v Cape Building Products Ltd [2014] CS1H 43 at paragraphs [9] to [11]; and ING Bank NV v Ros Roca SA [2012] 1 WLR 472 at paragraph 110.

 

[26]      Counsel for the defender proceeded to consider the sheriff’s findings in fact.  In terms of finding in fact 1, the sheriff found that the pursuers had acted for both Lujo Properties Ltd and the defender.  There had been much discussion as to which element of the work had been carried out for each of these two legal entities.  Some of the work had been carried out for the limited company and not for the defender qua individual.  Counsel focused on the passage within finding in fact 1 commencing “Fees in respect of such work…”  He submitted that the existence of one, single “umbrella contract” could not be inferred.  Instead, there had been a series of individual contracts as part of a course of dealing.  An agreed fee had been paid as a result and that was the end of the work to which the fee related.

 

[27]      When it came to a proper construction of the second fee agreement, counsel for the defender referred to the last three or four sentences within finding in fact 2.  The passage in question reads as follows:

 

“At the time that the defender first consulted the pursuer the street block was subject to the first of two proposed compulsory purchase orders by Glasgow City Council.  The City Council’s decision to issue the first CPO included a resolution to enter into an agreement with Atlas Investments Ltd (“Atlas”) who were a developer owning the major part of the street block with a view to its redevelopment.  Prior to his contacting the pursuers for advice in November 1999 he had received from Atlas an offer to purchase his property at 209 Buchanan Street.”

 

[28]      The court was informed that the defender had already received an offer to purchase from Atlas at a time when he instructed the pursuers to become involved.  His objective had been to secure a greater purchase price than the offer of £1.5 million which was then on the table.  At that stage, Atlas were the only developers who were in a position to proceed because they owned a major part of the street block.  As counsel for the defender put it, they were “the only show in town”. 

 

[29]      Under reference to finding in fact 6, emphasis was placed upon Colin Whyte’s role in the matter.  Counsel stressed that his role had not been to seek out other interested parties.  The sheriff, on the evidence, had concluded that, in contrast, Mr Whyte’s role was “to negotiate with Atlas or the District Valuer to secure either the best price for the defender’s property in Buchanan Street or the maximum amount of compensation.”  Accordingly, counsel contended that this involved a much more constrained remit which in turn would be reflected in the payment structure envisaged by the parties.

 

[30]      Finding in fact 8 was also a matter of significance, according to counsel for the defender.  It was in the following terms:

 

“In early autumn of 2009 Atlas passed into administration.  From that time until 6 January 2010 Colin Whyte of the pursuers provided no services to the defender in regard to disposal of the latter’s property at 209 Buchanan Street.  On that later date Colin Whyte emailed Giancarlo Romano with a copy of a press release notifying that Land Securities had bought the Atlas development site at Buchanan Street in Glasgow.  Thereafter Colin Whyte and Giancarlo Romano spoke on the telephone.  In the course of the conversation the subject of negotiations with Land Securities was raised.  Colin Whyte enquired whether Giancarlo Romano needed any assistance from him.  The defender’s son replied that he did not.  Giancarlo Romano did not in the course of that conversation seek approval from Colin Whyte to deal directly with Land Securities or their surveyor.”

 

[31]      Counsel for the defender also stressed the terms of findings in fact 9 and 10 which highlighted the lack of involvement on the part of the pursuers.

 

[32]      When it came to the sheriff’s note, counsel contended that, at paragraph [12], the sheriff had correctly identified the proper approach to be taken.  He highlighted the sheriff’s conclusion which was to the effect that the contingency was a disposal either by way of a negotiated agreement between the defender and Atlas or a compulsory purchase order by Glasgow District Council.  The sheriff then proceeded to analyse the background circumstances within paragraph [13]; the email exchanges were considered in paragraphs [14] to [17]; and subsequent actings, in so far as relevant, were looked at within paragraph [18].  However, in returning to paragraph [13] within the sheriff’s note, counsel for the defender laid stress upon the sheriff’s determination that the pursuers were never tasked with introducing a purchaser.  Such a finding, counsel submitted, undermined the pursuers’ approach when it came to the substance of this appeal.

 

[33]      Reference was made to No 5/2 of process being the email from Colin Whyte to Giancarlo Romano dated 21 May 2008, timed at 1621 hours.  Reference was also made to Nos 5/3 and 5/4 of process being, firstly, an email from Colin Whyte to Giancarlo Romano dated 3 June 2008 (1651 hours) and, secondly, an email from Giancarlo Romano to Colin Whyte dated 4 June 2008, timed at 1745 hours.  Counsel for the defender’s core submission was to the effect that on a proper construction of the material available, payment of fees to the pursuers was contingent upon either a sale of the subjects to Atlas or a CPO by Glasgow City Council.

 

[34]      Once again, under reference to paragraph [14] within the sheriff’s note, counsel for the defender argued that, at the very least, the sheriff’s construction of the parties’ agreement was a commercially sensible construction.  The pursuers had been operating upon a contingent basis.  They had assumed the risk that they might not be paid.  Counsel made reference to paragraph [21] within the sheriff’s note, at the foot of page 10, where the final sentence read as follows:

 

“It must be a fact of life for agents working for a sales commission that they will often require to work speculatively and it is a circumstance which the defender made no secret of seeking as far as possible to exploit in his dealings with property industry professionals.”

 

Discussion

[35]      Whilst the note of appeal is less than explicit, in effect, the pursuers largely seek to challenge certain findings in fact and a finding in fact and law arrived at by the sheriff, after proof.  For example, in finding in fact 6, the sheriff made a finding as to the nature and extent of Colin Whyte’s role at the time when the second fee agreement was entered into.  In finding in fact 7, the sheriff found, as a matter of fact, that the defender “…was not willing to pay the pursuers upon the basis of the time spent by them on behalf of himself or Lujo.  Colin Whyte on behalf of the pursuers accepted that.”  In finding in fact and law 1, the sheriff determined that the sale by the defender to Land Securities was not an event entitling the pursuers to be paid a commission or a sum calculated in accordance with Ryde’s scale either in terms of the second fee agreement or any implied new agreement.

 

[36]      Therefore, where it was accepted by counsel for the pursuers that the facts of the case were beyond dispute, it is difficult to see how the appeal can succeed.  In any event, the observations made by Lord Reed in the cases of McGraddie and Henderson are by now well-known and beyond contradiction.  It seems to me that the opening proposition laid down by counsel for the pursuers, viz. that the appeal was concerned with matters of construction is fundamentally incorrect.  The appeal is brought to challenge and contradict the factual findings made by the sheriff and, as such, it is not truly concerned with the construction to be placed upon an undisputed factual matrix. 

 

[37]      In McGraddie, having carefully analysed the law, the background circumstances, the Lord Ordinary’s opinion and the opinion of the Extra Division, Lord Reed concluded that “…the Extra Division had no proper basis for concluding that the Lord Ordinary had gone plainly wrong, let alone that on a reconsideration of the whole evidence the opposite conclusion should be reached.”  (See paragraph [33]).

 

[38]      I find myself drawn towards the same sort of conclusion in the present appeal.  In my opinion, nothing said in argument on behalf of the pursuers served to undermine the sheriff’s factual conclusions in any way.  In particular, findings in fact 6 and 7 must remain intact.  Counsel for the pursuers’ attempt to construe the various emails forming the pursuers’ first inventory of productions, to my mind, fell far short of demonstrating that the sheriff had plainly gone wrong when it came to the established facts of the case.

 

[39]      In any event, even if one were to approach this appeal as being intrinsically concerned with issues of construction as in the case of Rainy Sky and others mentioned at paragraph [25] supra, in that regard, I preferred the submissions advanced by counsel for the defender.  On the established facts of the case, I found his analysis of Colin Whyte’s true role in matters to be somewhat telling.  Under reference to finding in fact 6, counsel for the defender was, in my view, correct to highlight that role.  Colin Whyte had not been instructed to seek out other parties who may have been interested in the purchase.

 

[40]      In the whole circumstances, I was comfortable persuaded by counsel for the defender that the sheriff’s conclusion regarding the existence of a contingency was entirely accurate.  That contingency was a disposal either by way of a negotiated settlement between the defender and Atlas or a compulsory purchase order by Glasgow District Council.

 

[41]      The submissions advanced by counsel for the pursuers did not impact upon the sheriff’s summary at the beginning of paragraph [19] in his note.  It will be seen that the summary is followed by the sheriff moving on to consider the subsidiary issue of whether it was an implied term of any contract between the parties that the pursuers were due to be paid a reasonable fee for work said to be carried out by them from 1999 to late 2009.

 

[42]      At this stage, it is worth recording that I have found the manner in which the note of appeal was formulated to be less than helpful.  I also believe that its formulation did not assist counsel for the pursuers when, in turn, it came to the presentation of his submissions in the appeal.  The note listed three grounds of appeal.  However, it then proceeded to suggest that “there were essentially four questions for the court to answer” and listed those questions.  Thereafter, the continued narrative expressly stated that “This appeal only relates to questions A and D”.  What then followed was a further list of questions upon which the sheriff was asked to write a further note.  Put shortly, the note of appeal in the present case, was, in my view, confusing in its terms and, in any event, did not coincide with OCR 31.4(3) which rule only refers to grounds of appeal being “brief, specific numbered propositions”.  There is no provision for indulging in lists of questions.

 

[43]      In paragraphs [1] to [21], I have, I believe, accurately recorded the oral submissions of counsel for the pursuers.  Whilst it was obvious that considerable care had been taken over those submissions, the interaction between them and the note of appeal tended to throw up certain contradictions or ambiguities.  For instance, at the outset, counsel conceded without further elaboration that the pursuers could not prove that they were the effective cause of the ultimate sale of the subjects to Land Securities.  That being so, it seemed to me that the issue of “effective cause” could no longer be a live one and yet page 2 of the note of the appeal appears to make specific reference to this.  Additionally, counsel for the pursuers explicitly indicated that the appeal was, inter alia, concerned with question D on page 2 of the note of appeal.  That question has the appearance of relating to the second ground of appeal which, as I observe in the next paragraph, was not argued.

 

[44]      At all odds, and for the avoidance of any doubt, the appeal as presented consisted of grounds of appeal 1 and 3 as stated in the note of the appeal.  While counsel for the pursuers did appear to make passing reference to the business efficacy rule (see paragraph [20] supra) and once again to the issue of “effective cause”, in substance, nothing was said in support of the second ground of appeal.  The pursuers’ primary contention on appeal was to the effect that the sheriff had erred in holding that the pursuers were not contractually entitled to payment in terms of an agreed payment mechanism.  Thereafter, the pursuers’ “fall back” position was said to rely upon “quantum meruit”.  No other arguments were advanced on appeal.

 

[45]      Therefore having dealt with the pursuers’ primary argument, I now turn to the argument very briefly advanced by counsel for the pursuers in purported reliance upon “quantum meruit”.  That argument is recorded at paragraph [21] supra although I note that the apposite plea in law for the pursuers, viz. their third plea in law, is couched in the following terms:

 

“Esto the Pursuer is not entitled to be (sic.) payment in terms of the mechanism agreed between the parties, which is denied, the Pursuer is entitled to be paid quantum meruit for the work condescended upon.”

 

[46]      In advancing his argument, counsel for the pursuers made no reference to case law or any form of authority dealing with circumstances in which payment quantum meruit might arise.  However, Professor McBryde in the 3^rd edition of his work on the Law of Contract in Scotland states the position in straightforward terms at paragraph 9.45:

 

“Where there is a contract for services but no agreement on the amount of remuneration, the entitlement is to payment quantum meruit.”

 

[47]      It respectfully seems to me that, viewed from any angle, the pursuers’ purported reliance upon quantum meruit in terms of a “fall-back” argument is fundamentally flawed.  The sheriff held that, on the evidence led before him, the contract between the parties only provided for payment to the pursuers where there was either a sale to Atlas or a CPO by GCC.  It was a contingency based agreement.

 

[48]      Accordingly, as far as counsel for the pursuers’ submission is concerned, it seems to me that lack of clarity as to the precise basis for any payment to the pursuers is not a live issue in the appeal.  The introduction of such a hypothesis for consideration of the extent to which payment might fall to be made is obfuscatory in nature.  The sheriff for all intents and purposes sustained the defender’s third plea in law.  There was no contractual entitlement to payment on the part of the pursuers.  Therefore, any question said to relate to the amount of remuneration due to the pursuers simply does not attract valid consideration in the circumstances of the case.  Counsel for the defender dealt with the matter in concise but compelling terms:

 

“You either have a contract or you don’t.”

 

In my opinion, therefore, the pursuers’ reliance upon quantum meruit is fallacious and does not provide them with a successful ground of appeal.

 

Disposal

[49]      In summary, the arguments presented in support of the pursuers’ appeal in my judgement fall to be rejected.  In so far as they were challenged in the course of the appeal, I have concluded that the decisions arrived at by the sheriff were sound and that, in any event, the pursuers have failed to persuade this court to interfere with the fact-finding function for which the sheriff at first instance was responsible.  In the whole circumstances, I have adhered to the sheriff’s interlocutor dated 2 July 2014 and that of 23 July 2014.  This appeal having failed the defender is rightly entitled to the expenses occasioned by it.  I have also certified the appeal as suitable for the employment of junior counsel.