OUTER HOUSE, COURT OF SESSION

 

[2006] CSOH 90

 

A812/04

 

 

NOTE BY LADY PATON

 

in the cause

 

MICHAEL McLETCHIE

 

Pursuer and Reclaimer;

 

against

 

LOMBARD NORTH CENTRAL PLC

 

Defenders and Respondents:

 

 

ннннннннннннннннн

 

 

9 June 2006

 

Pursuer; Party

Defenders; Shepherd & Wedderburn

 

[1] On 20 May 2006, I received a request to provide a brief note in relation to two motion roll hearings which took place on 22 November 2005 and 2 February 2006. I have endeavoured to do so, with the assistance of manuscript notes made at the time.

 

Introduction

[2] In this action the pursuer seeks reduction of a sheriff court decree against him for payment of г11,990.90. He also seeks reduction and suspension of a charge following thereon.

[3] The defenders aver that they entered into a conditional sale agreement with the pursuer relating a Jaguar sports car. The car was delivered to the pursuer. The defenders sought payment in terms of the agreement. They ultimately raised an action for payment in the sheriff court. After sundry procedure, the defenders enrolled a motion for summary decree. Averments relating to that motion are contained in Answer 3. Summary decree was granted by the sheriff in December 2003. A charge was served on the pursuer.

[4] The pursuer responded by instructing solicitors to raise the present action for reduction in December 2004. In Article 9 of Condescendence, it is averred that the pursuer in fact had a defence to the action for payment. Details of that defence are set out. In Article 6 of Condescendence it is explained that the pursuer had understood that solicitors were dealing with the sheriff court action on his behalf. He had been unaware that decree had passed against him until service of the charge. Those averments are disputed by the defenders (Answers 3, 5, and 6). In particular, the defenders aver that the pursuer did not instruct solicitors until after summary decree was granted (Answer 3).

[5] At the outset of the present action, the pursuer sought interim orders suspending further diligence. Interim orders were granted on the basis of ex parte statements. Thereafter, although the pursuer's agents effected service of the interim orders, no steps were taken to serve the summons. In May 2005 the defenders enrolled a motion to have the pursuer ordained to serve the summons. They also enrolled a motion for recall of the interim orders. The first motion was granted; the second was continued on the basis of assurances given in court that the sum due in terms of the sheriff court decree would be paid.

[6] By the time of the continued motion, the pursuer's solicitors had withdrawn from acting. The summons had not been lodged for calling. On 28 June 2005, the court granted the defenders' motion to have the pursuer ordained to lodge the summons within 7 days. The summons was then lodged. The defenders timeously lodged defences.

[7] The pursuer thereafter failed to lodge a record. The defenders enrolled a motion for dismissal by default. On 12 August 2005, the pursuer appeared in person to oppose the motion. The motion was continued to allow records to be lodged. Records were then lodged, and the defenders dropped their motion.

[8] There were no adjustments by either pursuer or defenders. The record closed on the summons and defences on 2 November 2005. The defenders then enrolled a motion (1) for recall of the interim orders, on the basis that the pleadings in the Closed Record disclosed no prima facie case; (2) alternatively, for caution in the sum of г10,000. The motion was intimated to the pursuer by Recorded Delivery.

 

Starred motion on Tuesday 22 November 2005

[9] The motion came before me on 22 November 2005. Mr Fairley, Advocate, appeared for the defenders. The pursuer had previously corresponded with the defenders by e-mail, stating that he wished to oppose the motion, and that he would enrol his own motion. However by 22 November, the pursuer had not marked opposition to the defenders' motion, nor had he enrolled any motion of his own, nor did he appear in court.

[10] Mr Fairley invited me to recall the interim orders. He began to address me on that matter, referring to Walker, Civil Remedies, pages 184 and 185, and Campbell v McCance 1929 S.L.T 26. I indicated a reluctance to recall the interim orders standing the pursuer's averments in Articles 3, 5, 6, and 9, as to do so would in effect be to dispose of the case in that diligence could then proceed against the pursuer. I invited Mr Fairley to make submissions on the question of caution.

[11] Mr Fairley then referred to the history of the litigations in both sheriff court and Court of Session. He submitted that the pursuer had repeatedly failed to comply with orders of the court, and had also required to be prompted or forced into action at many procedural stages. Counsel stated that the pursuer had on several occasions assured the defenders' agents that payment would be forthcoming. At the hearing in the Court of Session in May 2005, undertakings had been given in open court that payment would be made to the defenders. In the light of that undertaking, the court had agreed to continue the defenders' motion for recall of the interim orders. However no payment had been made. Counsel explained that, in the light of the pursuer's conduct to date, the defenders were concerned that the pursuer would be unable to meet their expenses in the event that he was unsuccessful in the contested action of reduction and suspension in the Court of Session (which might well have to go to proof).

[12] I was persuaded that the pursuer should be ordained to find caution for expenses in the sum of г10,000 for the reasons advanced by counsel. I granted an interlocutor ordaining the pursuer to consign that sum of money by 11 January 2006.

Further adjustment, and failure to consign г10,000

[13] The pursuer enrolled a motion in early December 2005, seeking to have the cause restored to the Adjustment Roll for a period of 2 weeks. The court allowed a period of 3 weeks. The record closed on 28 December 2005.

[14] By 11 January 2006, no sum had been consigned. The defenders intimated a motion seeking absolvitor in terms of rule of court 33.10. There was no indication that the motion would be opposed, until 1 February 2006 (when the motion came before Lord Glennie). The pursuer handed counsel a note indicating opposition to the motion, and an intention to seek leave to reclaim late.

 

Opposed motion on 2 February 2006

[15] Lord Glennie continued the motions to come before me on 2 February 2006. The pursuer appeared in person, and the defenders were again represented by Mr Fairley.

[16] Mr Fairley gave a brief introduction, recapitulating the procedural history to date. He referred to a recent Inner House decision, The Bank of Scotland v Kunkel-Griffin, 15 February 2005. He also submitted that any motion on the part of the pursuer to seek to reclaim late was incompetent as the date for the lodging of caution (11 January 2006) had passed.

[17] The pursuer then addressed the court. He accepted that counsel had accurately narrated the history of the litigations up until the time when his solicitors withdrew from acting. But it was part of his argument that he did not "know the rules". He had managed to attend one hearing, simply because he had called the General Department to ask a question and had been advised of the hearing.

[18] Even when represented by solicitors, the pursuer had found matters unsatisfactory. The original solicitors had not done what they were instructed to do. The second set of solicitors had not pled the case as instructed. The important point was that the debt was not the pursuer's. That had not been included in the pleadings. The pursuer had never admitted that he owed the defenders anything. He had simply admitted the existence of a debt - owed by the Miclora Trust.

[19] The pursuer acknowledged that he had been sequestrated. He was now discharged. He was trying to build up his credit-rating. If decree of reduction were granted, he would do what he could to see that the debt was paid on behalf of the Miclora Trust. He asked the court to grant leave to reclaim on the basis that the debt was not owed by him. He had been an undischarged bankrupt at the time when he signed the conditional sale contract with the defenders. He had contacted the defenders, and asked if he could have a loan to buy a car. He was given to understand that it was the defenders' policy not to lend to a bankrupt, whether discharged or not. An application had then been made, involving a copy of the Miclora Trust Deed. The loan had been passed. The pursuer pointed out that it was the defenders who had made a mistake, allowing him to "slip through the net".

[20] When asked why he had not attended court on 22 November 2005, the pursuer stated that he had sent the defenders an e-mail indicating that he wished to oppose their motion. However he thought that he would be advised of a date. The pursuer added that he was unemployed. He had not taken legal advice about what action to take about the interlocutor of 22 November 2005. It was only on 1 February 2006 that he had come to realise that he could reclaim.

[21] The pursuer advised the court that if the case came to an end that day (2 February 2006) the defenders would sequestrate him. He wanted to continue with the litigation. In the end of the day, the debt was not his. He was trying to keep his name clear, and to get a credit-rating. He did not deny that the Miclora Trust owed the defenders money. The trust had been set up by him in 1998, with a deed registered in the Books of Council and Session. He was a trustee of the trust. His trustee in bankruptcy had been aware of his position in the trust. The trust did not in fact have any money.

[22] Mr Fairley responded by submitting that, even if the pursuer's motion was competent, nothing which the pursuer said suggested that the court had erred in law in ordering consignation, given the material before the court on 22 November 2005. Reference was made to Macphail, Sheriff Court Practice, paragraph 18.51; Marsh v Baxendale, 1994 S.C.L.R. 239; Walker, Civil Remedies, page 176; and Forrest v Dunlop (1875) 3 R. 15. The summons did not explain why decree had been allowed to pass in 2003, or why no appeal had been taken: Macphail, op. cit. paragraph 18.55. The standard set out in Forrest (a "strong case of inadvertence") had not been met either in respect of the passing of the decree, or the failure to appeal. The pursuer had not made out a prima facie case.

 

Decision

[23] The defenders sought absolvitor in respect that caution had not been lodged. In view of the history of the litigations, the terms of rule of court 33.10, and the defender's failure to consign the sum of г10,000 as caution for expenses in compliance with the interlocutor of 22 November 2005, I granted the defenders' motion. My interlocutor of 2 February 2006 also bears to refuse the pursuer leave to reclaim against the interlocutor of 22 November 2005. Against the background narrated in this Note, I certainly formed the view that the court's discretion should not be exercised in favour of the pursuer. However I accept that the question of reclaiming out of time is a matter for the Inner House: rule of court 38.7 and The Bank of Scotland v Kunkel-Griffin, 15 February 2005 (Inner House).