|
OUTER HOUSE, COURT OF SESSION
[2008] CSOH 69
|
|
PD56/08
|
OPINION OF LORD DRUMMOND YOUNG
in the cause
ANN CATHERINE
HYLANDS
Pursuer;
against
GLASGOW
CITY COUNCIL
Defenders:
________________
|
Pursuer:
McConnell; Thompsons
Defenders: Cleland;
G. Lindsay, Edinburgh City Council
13 May 2008
[1] On
8 May 2006 the pursuer,
who was employed by the defenders as a clerical assistant, was injured at work
when a partition fell and struck her on the back. On 5 March
2007 her agents intimated a claim against the defenders. The claim was intimated again on 6 December,
and on 23 November the defenders repudiated liability. On 4 December
2007 the pursuer's agents asked the defenders to reconsider their
position, but on 7 January 2008
the defenders reiterated their repudiation of liability. On 10 January
2008 a summons was signeted.
The sum concluded for was £10,000.
The summons was served on the defenders on 23 January. On 7 March defences and a tender were
lodged; the tender was for payment of £2,500
with expenses to date in full satisfaction of the conclusions of the
summons. That tender was accepted. On 18 April the defenders enrolled a
motion under Rule 42.5 of the Rules of Court for modification of the
pursuer's expenses to the summary cause scale in the sheriff court, without
certification for counsel. That motion
called before me on 22 April. I
heard detailed submissions on the motion, and it appeared to me that a
significant issue of principle arose which merited a written opinion.
[2] The
basis for the motion was that the sum accepted by the pursuer in terms of the
tender and acceptance was less than the limit of the privative jurisdiction of
the sheriff court. The privative
jurisdiction of the sheriff court, fixed by section 7 of the Sheriff
Courts (Scotland)
Act 1907 and section 31 of the Sheriff Courts (Scotland)
Act 1971, was set at £1,500 prior to 14 January 2008.
On the latter date the Sheriff Courts (Scotland)
Act 1971 (Privative Jurisdiction and Summary Cause) Order 2007
(SI 2007 No. 507) came into force.
Article 2 of that Order raised the limit of the privative
jurisdiction to £5,000.
Article 4 of the Order provided that the amendment made by Article 2
should not apply "in relation to any proceedings commenced before 14 January 2008".
[3] The
significance of the privative jurisdiction of the Sheriff Court was explained
in two cases, McIntosh v British Railways Board, 1990 SC 339,
and Coyle v William Fairey Installations Ltd, 1991 SC 16. In the first of these cases the First
Division considered a motion that an action should be remitted to the sheriff
court. Lord President Hope stated
(at 343):
"The
privative jurisdiction of the sheriff court is defined by reference to a
particular sum of money, so that everyone knows that all causes not exceeding
that sum in value must be brought in the sheriff court. All causes exceeding that sum in value may be
brought either in the Court of Session or in the sheriff court at the option of
the pursuer ....
In this situation the proper
approach to [the section permitting a remit] seems to us to be that,
except in extreme cases, the fact that the claim is small and straightforward
is not enough to justify a remit to the sheriff court. By extreme cases we mean cases where it is
obvious from the pleadings, whatever may be the sum sued for, that on no
possible view could the pursuer recover more than the upper limit to the
privative jurisdiction of the sheriff court.
If this is the case, then the action is plainly appropriate for the
sheriff court, because it ought not to have been raised in the Court of Session
at all. But if the pleadings show that
the pursuer could possibly recover more than the upper limit then the action
should be regarded as appropriate for the Court of Session unless some other
factor is present which shows that the nature of the particular case is such
that it is appropriate for it to be dealt with in the sheriff court".
The Lord President then referred to
the availability in the Court of Session of jury trial and the optional
procedure for reparation actions; these
were not available in the sheriff court.
He continued (at 344):
"It is not
right that litigants should be deprived of these advantages just because their
claims are small and simple, so long as they are claims which can competently
be made in this court. The smaller and
simpler the claim that more force that is in the point, in the general public
interest, that they should be dealt with as quickly as possible in the court
which is best able to achieve this result.
Procedure by way of summary cause in the sheriff court is cheap and
simple, but a pursuer under that procedure cannot recover more than the upper
limit in value for actions for payment of money, currently £1500 exclusive
of interest and expenses. This makes it
unsatisfactory for actions of reparation where a pursuer might possibly recover
more than that amount, which is no doubt why actions of reparation are not
often brought under that procedure".
In relation to expenses, the court's
view was as follows (at 345),
"Nothing in
what we have said so far is intended to restrict in any way the power of the
court to modify an award of expenses to a pursuer at the end of the case. A pursuer who raises his action in the Court
of Session and seeks to take advantage of the practices and procedures of this
court must take account of the risk that if the sum which he recovers is small
he will be confined to expenses on the sheriff court summary cause scale or on
the sheriff court ordinary court scale with or without sanction for counsel
according to the circumstances ... At
this stage, when all the facts are known and all imponderables are out of the
way, the court can reflect its view as to whether in the event the sheriff
court was the appropriate court for the determination of the case. It does so with the advantage of then knowing
the result, which is an advantage not usually enjoyed by the pursuer's advisers
at the start of the case. This is a
valuable safeguard in the defenders' interest against their being exposed to
claims in this court where the awards are trivial in relation to the
expenses".
[4] In
Coyle v William Fairey Installations Ltd, the question that arose was
whether expenses should be modified. The
approach taken in McIntosh was
followed; the court stated (at 1991
SC 19):
"The proper
approach ... is that in respect of actions brought in the Court of Session the
court should determine whether the initial choice of that forum was justified in all the circumstances of the case known to
the pursuer's advisers when the action was raised, having regard to the high
level of costs likely to be incurred by bringing an action there. The court's judgment on that matter may be
assisted by a consideration of events which have occurred subsequent to the
date on which the choice was made, including the very important consideration
of the result of the case; but the
result, particularly if it is one which is achieved by settlement, does not
necessarily resolve the issue whether the initial choice of forum was inappropriate on the grounds that the value of the claim
was not commensurate with Court of Session expenses. For example, a pursuer might well agree to a
settlement at a figure substantially less than that at which a claim had been
properly valued, in order to avoid a prolonged period of delay and uncertainty,
or because further information had come to light of which the pursuer's
advisers were justifiably unaware when the action was commenced".
[5] The
result of McIntosh and Coyle is accordingly that, if the sum
recovered by the pursuer is small, that is a factor that the court may take
into account in determining whether expenses should be awarded on the Court of
Session scale or one of the sheriff court scales. The argument for restricting expenses to a
sheriff court scale is obviously particularly strong when the sum recovered is
below the level of the privative jurisdiction of the sheriff court, because in
such a case the action should not normally have been raised in the Court of Session
at all. Nevertheless, the level of
recovery is not conclusive; if it
appears that the sum ultimately recovered was the result of a settlement
designed to resolve delay or uncertainty, or because further information had
come to light as the action proceeded, it might be appropriate to award
expenses at the Court of Session level.
Likewise, as pointed out in
McIntosh, the court may have regard to specific advantages of Court of
Session procedure, notably the existence of jury trial and special procedures
available under the Rules of Court for the expeditious disposal of reparation
actions. In view of those advantages, it
will usually only be in cases where the pursuer falls short of the privative
jurisdiction of the sheriff court by a substantial margin that expenses will be
modified.
[6] Since McIntosh and Coyle were decided, Chapter 43 of the Rules of Court has come
into operation. This has provided
significant advantages for litigants in personal injury actions, and it is
clear that such cases are now disposed of more quickly and more cheaply and was
formerly the case. In view of the
advantages of the Chapter 43 procedure, Outer House judges have in recent
years been more reluctant than formerly to modify expenses because the pursuer
has recovered a small amount. Thus in Wilson v Glasgow City Council, 2004
SLT 1189, Lady Smith refused to modify expenses in two cases where
the pursuers accepted tenders of £2,250 and £2,000 respectively. She referred to the advantages of the new
procedure and expressed the view that, in view of very clear liability on the
part of the defenders, the cases were likely to settle in early course under
that procedure. In addition, jury trial
might have been appropriate if the cases had not settled. In
Benson v City of Edinburgh District
Council, 2004 SLT 1227, Judge JG Reid refused to modify expenses
in a case where action raised for £25,000 was settled, following
acceptance of a tender, for £3,400.
He pointed out the advantages of Chapter 43, in particular the
requirements of early disclosure, early evaluation of prospects and early
valuation of the claim; it was obvious
that these considerations were "likely to lead to settlement at a much
earlier stage than hitherto was the norm" (paragraph [14]). That in turn meant that the level of expenses
was not likely to be particularly high by comparison with the rates of sheriff
court expenses (paragraph [16]).
Judge Reid further indicated (paragraph [17)) that it was not
necessarily inappropriate for a straightforward claim known to have a maximum
value of £5,000 to be raised in the Court of Session; such claims were ideally suited to the Chapter 43
procedure, and if it were thought appropriate to keep such cases out of the
Court of Session that could be done by raising the privative jurisdiction of
the sheriff court.
[7] In Hunt v British Bakeries Ltd, 2005 SCLR 178, the pursuer accepted a
tender of £1,450, slightly below the limit of the privative jurisdiction
of the sheriff court that was then in force.
Lady Smith refused a motion to modify expenses. She pointed out (at paragraph [9]) that,
when a case was likely to fall not far outwith the privative jurisdiction, it
did not require to be raised in the sheriff court, and did not require to be
raised as a summary cause. In addition,
it appeared that the action was likely to settle, which meant that the Chapter 43
procedure was important; no cogent
argument was advanced to the effect that a similar efficiency and expedition
would have been achieved in an ordinary cause in the sheriff court, or that an
ordinary cause would have cost less.
Lady Smith concluded (at paragraph [12]) by pointing out that
the wider issue of whether straightforward, small value personal damages claims
should as a matter of principle be litigated in the Court of Session was not
addressed. Finally, in Galbraith v First Glasgow (No 1) Ltd, 2006 SLT 317, the
pursuer accepted a tender for £2,875.
Lord Kinclaven refused a motion to modify expenses. He expressed the view that practice had
changed since the era of McIntosh and Coyle;
the Chapter 43 procedures were important in achieving the aim of
earlier settlements, with the result that there was often a good reason for
raising proceedings in the Court of Session.
As in Benson and Hunt, it was pointed out that the wider
issue of principle as how best to deal with straightforward low value personal
injuries cases was not addressed.
[8] Thus
the introduction of the Chapter 43 procedure appears to have brought about
a change in the practice of the Court; it
has become relatively unusual for expenses to be modified even where the
damages accepted by a pursuer are relatively modest. That practice has proceeded, however, on the
basis that the privative jurisdiction of the sheriff court is £1,500. In Benson
Judge Reid expressly referred to the possibility that the privative
jurisdiction might be raised if it were thought desirable to keep claims of low
value out of the Court of Session. The
limit of the privative jurisdiction has now been raised by a substantial
margin, to £5,000, under the Sheriff Courts (Scotland)
Act 1971 (Privative Jurisdiction and Summary Cause) Order 2007. That Order has also by Article 3 raised
the financial limit for summary causes in the sheriff court by a like amount,
from £1,500 to £5,000. That
means that any claim for an amount less than £5,000 can now be raised as a
summary cause.
[9] The
latter change is significant. If an
action proceeds as a summary cause in the sheriff court, the procedure is informal
and expeditious. Rules 8.2
and 8.3 of the Summary Cause Rules 2002 provide that in every
defended action a hearing is to be heard on the calling date, at which the
sheriff is to ascertain the factual basis for the action and any defence and
the legal basis on which the action and defence are to proceed. The sheriff is also directed, by Rule 8.3(2)(b),
to seek to negotiate and secure settlement of the action between the
parties. If he is unable to do so he
must identify and note the issues of fact and law which are in dispute and note
any agreed facts. He may further proceed
to an immediate hearing on issues of law.
On that basis it seems that the Summary Cause Rules are well directed
towards securing an agreed settlement at a very early stage of
proceedings. Moreover, Chapter 34
of the Summary Cause Rules makes specific provision for actions of damages for
personal injury; this part of the Rules
has no equivalent in ordinary cause procedure.
Chapter 34 provides for a short and simple form of summons and the
lodging along with the summons of the pursuer's medical reports and a statement
of valuation of claim (Rule 34.2).
If the defender wishes to defend the action he must complete and lodge a
form of response giving notice of the grounds of fact and law on which he intends
to resist the claim, together with a brief statement of the facts upon which he
relies. Thus the procedure that is
available in personal injury actions under the Summary Cause Rules is designed
to identify any issues in dispute at an early stage, to provide a valuation of
the claim at an early stage, and to achieve a settlement, if that is possible,
at an early stage. Those are precisely the advantages of the Chapter 43
procedure in the Court of Session.
[10] I was also provided with information about the level of fees
likely to be incurred in a personal injuries action in the Court of Session and
a personal injury claim that proceeds as a summary cause in the sheriff
court. It is not necessary to go into
the figures in detail; I was satisfied
that the level of expenses in a summary cause is substantially less than that
found in the Court of Session.
[11] The clear intention underlying the legislation increasing the
privative jurisdiction and the financial limit for summary causes is that
claims of small value should proceed as summary causes in the sheriff court and
not in the Court of Session. In my
opinion those changes have important implications for the level of expenses
that may be recovered in the Court of Session.
It seems to me that the approach to the modification of expenses laid
down in McIntosh and Coyle must once again receive full
effect. While a judge dealing with a
motion for modification of expenses has a discretion, it is a major factor in
the exercise of that discretion that the level of damages ultimately awarded or
accepted fell significantly below the level of the privative jurisdiction of
the sheriff court. That factor is not
conclusive for the reasons set out in paragraph [5] above; nevertheless, it seems to me that it is important. Moreover, the financial limit for summary
causes has been increased, and in such cases a simple and expeditious procedure
is now available under the Summary Cause Rules.
In these circumstances I am of opinion that the advantages of the Chapter 43
procedure are unlikely to be material in a case where the award is
significantly below the level of the privative jurisdiction. Finally, the increase in the privative
jurisdiction is a clear indication that claims for relatively small amounts are
not appropriate for jury trial. That is
no doubt justified on the basis that a jury trial is a relatively costly and
time-consuming procedure, the costs in question comprising not only legal
expenses but also the services of members of the public.
[12] For the reasons stated, I am of opinion that since the increase
in the privative jurisdiction of the sheriff court the expenses awarded to a
pursuer who recovers a sum significantly below the limit of the privative
jurisdiction should normally be modified to the summary cause scale without
certification for counsel. Exceptions
may exist, such as where the pursuer's claim raises an issue of fact or law of
some difficulty, or where some unforeseen factor has arisen as the action
proceeded, or where it appears that the pursuer has accepted a compromise
figure to avoid the delays and uncertainties of litigation. Likewise, if the pursuer does not fall below
the level of privative jurisdiction by a significant margin, it can normally be
inferred that it was reasonable to raise proceedings in the Court of Session.
Because in a summary cause the damages awarded may not exceed £5,000, if
there is a realistic possibility that a greater sum might be awarded the choice
is between the Court of Session and ordinary cause procedure, and in those
circumstances the advantages of the Chapter 43 procedure and the
possibility of jury trial may be significant, as accepted in, Wilson, Benson, Hunt and Galbraith.
[13] In the present case, the pursuer has accepted a tender of £2,500. In my opinion that is significantly below the
level of the privative jurisdiction, and in the absence of special
circumstances I would consider it appropriate to grant the defenders' motion to
modify expenses to the summary cause scale without certification for
counsel. It was not suggested that the
present case was one of particular difficulty, or that the settlement was the
result of unforeseen circumstances, or that the pursuer accepted a figure well
below what the claim was truly thought to be worth; nor was it suggested that there were any
other exceptional circumstances apart from the specialty discussed in the next
paragraph. Consequently, were it not for
that specialty, I would have granted the defenders' motion.
[14] The specialty is that the present action was raised immediately
following the increase in the privative jurisdiction. On 7 January
2008 the defenders repudiated liability for a second time, and
three days later, on 10 January, the summons was signeted. The Order increasing the privative
jurisdiction had no effect in relation to "any proceedings commenced
before 14 January 2008". The present summons was served on 23 January 2008. For the defenders it was submitted that the
proceedings in the present case had been "commenced" on that date.
That was the usual meaning of the word "commenced", as indicated in Macphail on Sheriff Court Practice, 3rd
edition, at paragraph 6.06. By
the time when the summons was served the privative jurisdiction had been
increased, and thus the pursuer had fallen significantly below the level of the
privative jurisdiction that applied to the present case. For the pursuer it was
submitted that the critical question was whether it was reasonable to have
raised the present action in the Court of Session. That question must be decided at the time when
the action was raised. On 10 January 2008, when the
summons was signeted, the Order increasing the privative jurisdiction had not
come into force, and the privative jurisdiction of the sheriff court was
accordingly £1,500. It was clear
that the claim was worth more than that;
consequently it was reasonable for the pursuer to choose to raise
proceedings in the Court of Session.
[15] In my opinion the pursuer is correct in submitting that the
reasonableness of any particular form of proceedings must be tested at the date
when those proceedings were raised. In
the present case, the raising of proceedings involved two stages: the signeting of the summons and its
subsequent service. The summons was
signeted three days after a second rejection of the pursuer's claim by the
defenders. In view of the two rejections
of the claim, I am of opinion that it was reasonable to begin an action
immediately. The increase in the
privative jurisdiction was due to come into effect four days later, with the
consequences described above, but it is unrealistic to expect that those
responsible for the formal steps of court procedure would have that in mind
when they had the summons signeted following the rejection of the pursuer's claim. When the summons was signeted the privative
jurisdiction was £1,500. It was not
disputed that the pursuer was likely to recover a sum in excess of that amount,
and in fact she did so. Consequently
summary cause proceedings would not have been appropriate, and the choice was
between an action in the Court of Session and a sheriff court action proceeding
as an ordinary cause. In those
circumstances Court of Session procedure had the advantage of the Chapter 43
procedure; the ordinary cause procedure
did not have any equivalent of Chapter 34 of the Sheriff Court Rules or Chapter 43
of the Rules of Court. Jury trial was
also a possibility in the Court of Session.
In the light of those advantages of Court of Session procedure, it had
been recognized in a series of cases, Wilson, Benson, Hunt and Galbraith, that
it would usually be reasonable to raise an action in the Court of Session even
though the sum recovered might not be greatly in excess of the privative
jurisdiction. In those circumstances I
am of opinion that it was reasonable for the pursuer's agents to take steps to
raise an action in the Court of Session;
that was the established law, and that law was still applicable when the
summons was signeted.
[16] Once the summons was signeted, the pursuer was committed to
proceedings in the Court of Session. In
theory the pursuer's agents, noticing that the privative jurisdiction had been
increased, might have taken no further steps with the signeted summons and
instead raised summary cause proceedings in the sheriff court. That would, however, involve wasting the work
that had been done, and it assumes that the significance of the increase in the
privative jurisdiction should have been noticed. In all the circumstances it does not seem
realistic to expect that Court of Session proceedings should have been
terminated after the summons had been signeted.
I am accordingly of opinion that it was reasonable for the pursuer's
agents to continue with the Court of Session action by serving the summons,
notwithstanding the increase in the privative jurisdiction.
[17] The defenders' argument was based on the proposition that an
action is "commenced" at the date of service. It seems clear that that is the normal rule; that appears from paragraph 6.06 of
Lord Macphail's work on Sheriff Court Practice, and it seems correct in
principle, since it is only at service that a defender is convened. It follows that it would have been
incompetent to raise an action in the Court of Session concluding for less than £5,000
at the time when the present action was commenced. Nevertheless, the present action was not
incompetent, because the conclusion was for more than that amount. The sanction for raising an action for an
amount that truly falls below the limit of the privative jurisdiction lies in
expenses, or possibly a remit to the sheriff court. In the present case any sanction would have
taken the form of modified expenses. For
the reasons already stated, I am of opinion that the pursuer's agents acted
reasonably in the steps taken to initiate the present action. In those circumstances I decline to exercise
the court's jurisdiction to modify the pursuer's expenses. I would emphasize, however, that that
decision is made in the very specific circumstances of the present case, which
arise out of the increase in the privative jurisdiction. If similar facts were to occur in future, I
am of opinion that in the absence of special circumstances it would be
appropriate to modify the pursuer's expenses.
