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Persons liable

17 March 08

Latest civil cases, including unincorporated associations; delarator; joint and several liability; decree; sist; pre-action recovery; curators ad litem; caution; expenses

by Lindsay Foulis

Unincorporated associations

Whilst it was not the issue which Lord Menzies required to determine in Harrison v West of Scotland Kart Club [2008] CSOH 33; 21 February 2008, it is perhaps worth noting the observations in his Lordship’s opinion that a member of a club cannot sue the club or any office bearer representing the club. The club has no legal persona. A member of a club has no greater liability simply as a result of being an office bearer. A member of a club can be personally liable in delict, but the club does not become vicariously liable. A club’s constitution may allocate responsibility to certain individuals.

These issues became relevant in determining whether a minute of amendment was time barred when it sought to introduce another 16 club members as defenders on the basis that they were personally responsible for the pursuer’s losses, when there had never been any prior suggestion of such personal liability on their part. The raising of an action against the club and certain office bearers as representing the club and as individuals was insufficient to allow the 16 proposed defenders to be convened after the triennium.

Issues for declarator

In Clarke v Fennoscandia Ltd [2007] UKHL 56; 2008 SLT 33 the pursuer sought declarator that a judgment obtained by the defenders in a court in the United States of America was unenforceable, having been obtained by fraud. The defenders had undertaken not to enforce this judgment in Scotland or take steps to allow others to enforce the judgment. The House of Lords upheld the dismissal of the action. In light of the undertaking given, there was no live issue of recognition of the United States decision or subsequent enforcement. In light of the recognition and enforcement not being an issue, the pursuer was simply endeavouring to undermine the judgment pronounced by a competent court in proceedings conducted fairly in that forum. This decision reiterates the requirement for a live issue before any declarator be pronounced.

Joint and several liability

In Preferred Mortgages Ltd v Shanks [2008] CSOH 23; 7 February 2008, an action was raised against a surveyor, his former partner, and a solicitor following the default of borrowers. Liability was said to be joint and several among the defenders. This basis of liability was disputed by the solicitor. If the liability was joint and several it would result in his being found liable for losses attributable to the surveyor’s negligent overvaluation. On reviewing authority, Lord Drummond Young noted that it was clear that the crucial issue was whether the actions of the defenders contributed to a single loss sustained by the pursuer. The precise nature of the legal liability of each defender did not matter, provided that actions of each defender contributed to a single loss.

Decree by default

In Strathclyde Associated Property Holdings Ltd (in liquidation) v KAH Ltd [2007] CSOH 210; 2008 GWD 2-26 Lord Hodge granted decree by default following the defenders’ failure to appear at a hearing. There was no requirement to assign a further hearing to ascertain whether the defenders intended to insist on their defence. The defences were irrelevant, agents had previously withdrawn, and no arrangements had been made for the hearing.

Sist pending non-Scottish decision

In Clydesdale Bank plc v Wright, Inverness Sheriff Court, 20 February 2008 Sheriff Pyle sisted an action in respect of recovery of bank charges pending the issue of a decision in the High Court in London. The basis for the motion to sist was fivefold. There was an overlap between the issues in the two actions, the law was identical, the continued pursuit of the action would create uncertainty, there was an unnecessary administrative burden placed on the courts, and finally measures had been taken to protect the interests of the litigants. Sheriff Pyle did not consider that any apart from the first issue was significant. In particular, he observed that whilst a statutory provision or common law principle might be the same on both sides of the border, it might be applied differently to a set of facts or construed differently. There was no guarantee that a statutory provision would be construed in the same way on both sides of the border. However standing the stage reached in the English proceedings he sisted the action pending the issue of the decision in England.

Recovery of documents

In Scottish Widows Investment Partnership Group Ltd v Channing [2008] CSOH 7; 16 January 2008 the issue was whether an application under the Administration of Justice (Scotland) Act 1972, s 1 prior to litigation should be granted. There required to be averments in any such application which established an intelligible prima facie case although full averments of fact were not required. Lord Osborne determined that the test was not satisfied. On a reading of the averments in the application, they did not suggest that proceedings were likely to be brought.

Curators ad litem

In Procurator Fiscal, Kirkcaldy v E, Kirkcaldy Sheriff Court, 30 November 2007 an issue arose as to whether it was competent to appoint a curator ad litem. The proceedings were at the instance of the procurator fiscal in terms of the Proceeds of Crime Act 2002. The solicitor for the defender was unable to take instructions, possibly as a result of the defender’s drug addiction. His solicitor was of the opinion that the defender was suffering from some mental disorder. A psychiatrist was of the opinion that until the defender dealt with his drug addiction, she was unable to assess whether he did suffer from such a disorder. The defender lived on his own and was not persuaded to seek medical advice. Against this background, the Crown sought the appointment.

On reviewing authority Sheriff Braid considered that a curator ad litem could not be appointed simply in the interests of justice. There required to exist some kind of legal disability. He also observed that with the implementation of the Adults with Incapacity (Scotland) Act 2000 it might be considered that intervention orders superseded the requirement of curators ad litem, but he rejected such a view. He concluded, however, that the criteria for the appointment of a curator ad litem were the same as those required to support an appointment in terms of that Act.

He reached this view for a number of reasons. First, prior to the 2000 Act the criteria for the appointment of curators bonis and curators ad litem were the same. Further, with the introduction of the Act it seemed illogical and potentially unjust if different criteria applied for the appointments. Finally, in family actions a curator ad litem had to be appointed when the defender was suffering from a mental disorder. The definition of mental disorder in the ordinary cause rules corresponded with the definition in the 2000 Act. It was undesirable if one test applied to family actions, whilst another applied to other actions. In light of that conclusion Sheriff Braid considered it preferable for a guardian or intervener to be appointed instead of a curator ad litem. He further concluded that there was no clear common law basis for a court to insist that a party be medically examined.

Caution for guardians

In Application in respect of RL, 28 December 2007, Sheriff Baird in Glasgow noted the difficulties in guardians obtaining caution and ultimately was forced to dispense with the requirement of caution.

Any practitioner involved in applications under the Adults with Incapacity (Scotland) Act 2000 may wish to look at this decision, which appears on the Scottish Courts website.

Expenses

In Henderson v Henderson, 2008 GWD 2-32 the auditor allowed a solicitor appointed as curator ad litem to a defender in a divorce action to charge in accordance with the Law Society of Scotland’s (then) conveyancing and general business table of fees. This account formed an outlay in the pursuer’s legal aid account. The position of the curator ad litem was different to that of a solicitor appointed to act as reporter in a dispute involving children. The former required to exercise legal skill and knowledge in the discharge of the curator’s duties of deciding whether to defend the action and to what extent. These duties could only be carried out by someone legally qualified. Whilst SLAB took a note of objections to this decision, they did not proceed with it.

In Bell v Inkersall Investments Ltd, Dumfries Sheriff Court, 7 December 2007 a number of issues regarding expenses arose. One motion was for a party’s solicitor to be found personally liable for an abortive day as a result of failing to produce financial information. Sheriff Ross considered that whilst solicitors should check the terms of interlocutors, in the particular circumstances of that case the failure to do so, thus contributing to the failure to produce the necessary information, did not render the agent personally liable. Counsel had an equal responsibility and no mention had been made of the production of information in open court.

Having regard to the party’s financial circumstances and his conduct of the action, a motion to modify liability in expenses in terms of s 18(2) of the Legal Aid (Scotland) Act 1986 was refused. Sheriff Ross further found the pursuer liable for expenses on an agent and client, client paying basis, having regard to the conduct of the litigation which was totally unreasonable. An argument without merit had been persisted in, causing considerable expense to the defenders. The weakness of the basis of action had been made apparent in another litigation.

The usual caveat applies.