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OUTER HOUSE,
COURT OF SESSION
[2013] CSOH 97
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CA109/11
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OPINION OF
LORD HODGE
in the cause
McCRINDLE
GROUP LTD
Pursuer;
against
MACLAY
MURRAY & SPENS
Defender:
________________
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Pursuer: Murphy
QC, McBrearty; TLT Scotland Limited
Defender: Hanretty
QC; Shepherd & Wedderburn LLP
4
June 2013
[1] In my opinion of 14 May
2013 ([2013] CSOH 72) I determined the sums which MMS was due to pay MGL
in respect of the loss of its entitlement to interest in the arbitration
against HYL and also the loss of the prospect of a better settlement of that
arbitration. That left for determination (i) the amount of MGL's legal
expenses in the arbitration between 30 May 2003 and 15 October 2003,
and (ii) the interest on MGL's damages until the date of decree.
[2] Counsel accepted that it was
not possible to allocate precisely to the relevant dates the fees and outlays
which MGL had paid in respect of longer periods. The parties' preferred
estimates ranged from about £9,000 to about £16,000; and it was agreed that it
was not appropriate to spend more time and money on any more sophisticated
analysis. I am persuaded that MMS's estimate, which is supported by a report
of a law accountant, is the best available estimate of MGL's liability in the
relevant period and find that MGL is entitled to £9,472 in respect of the legal
expenses which it incurred in the arbitration but which a settlement on 30 May
2003 would have avoided.
[3] In relation to MGL's claim
for interest, I accept Mr Murphy's submission that judicial interest
should run on £369,000, being the aggregate of (i) the sums which I have
awarded for the loss of MGL's interest claim and the loss of a chance of a
better settlement and (ii) the £90,000 which MGL received in the settlement on
3 June 2004, from 30 May 2003 until 3 June 2004. This is
because, if the parties to the arbitration had settled their dispute on 30 May
2013, the £90,000 paid in the June 2004 settlement would have been paid at
around that time as part of the larger settlement and not one year later. From
4 June 2004, when HYL paid the £90,000, the principal sum, which is the
aggregate of the sums due for loss of the interest claim and the loss of a
chance of a better settlement, amounted to £279,000.
[4] Counsel agreed that the
appropriate rate of pre-decree judicial interest on that sum should be the
normal rate of 8% per year until 4 December 2008. Thereafter, it should
be 4% per year to reflect the dramatic fall in market rates in late 2008
and the very low levels of interest rates thereafter. This accorded with the
approach which I adopted in Farstad Supply AS v Enviroco Ltd [2011]
CSOH 153 (2012 SLT 348) and which an Extra Division has upheld
([2012] CSIH 9 (2013 SLT 421)).
[5] Counsel agreed that interest
on the claim for avoidable legal expenses accrued at 4% per year from 30 May
2003 to 15 October 2003. Otherwise pre-decree interest on all claims was
to be as in para [4] above. Counsel also agreed a schedule of loss which
discloses that MMS is due to pay MGL a total sum (inclusive of interest to 4 June
2013) of £473,706. They have agreed that interest should run on that sum at 8%
per year until payment from today's date. I therefore pronounce decree in
those terms.
[6] On MGL's unopposed motion, I
certify Mr Michael Simpson and Mr Stewart Mullan as skilled
witnesses. The former prepared a report and gave evidence. The latter
prepared a report. Also, on MGL's unopposed motions, I (i) find MMS liable to
MGL in the expenses of process in so far as not already dealt with and (ii)
find MGL's solicitors entitled to an additional fee in terms of rule of court 42.13(3)
under reference to heads (a), (b), (c), (e), (f) and (g).
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URL: http://www.bailii.org/scot/cases/ScotCS/2013/2013CSOH97.html
