MOHAMMAD SHARIF & ANOTHER AGAINST DR MOHAMMED MOUGHAL [2023] ScotCS CSOH

OUTER HOUSE, COURT OF SESSION

[2023] CSOH 42

A125/21

OPINION OF LORD STUART

In the cause

(FIRST) MOHAMMAD AZIR SHARIF AND (SECOND) MANAWAR SHARIF

Pursuers

against

MOHAMMED SHOAIB MOUGHAL

Defender

Pursuers: Roxburgh; BTO Solicitors LLP

Defender: Tosh; Dentons UK and Middle East LLP

30 June 2023

Introduction

[1]

The first pursuer and defender were, respectively, tenant and landlord of the

pursuers' family home ("the Property") under a private residential tenancy agreement

dated 1 September 2018. By application to the First-tier Tribunal for Scotland (Housing

and Property Chamber) ("the FtT"), the defender sought eviction of the first pursuer and

his family from the Property. By decision dated 20 September 2019 the FtT granted the

defender's application and made an order for eviction ("the FtT Decision"). In this action

the pursuers seek reduction of the FtT Decision.

[2]

The case called before me on 8 June 2023 for debate. The defender sought dismissal

of the action on the basis that the pursuer's pleadings did not disclose a relevant basis for

reduction. It was common ground between counsel that the correct test for this court to

apply is that an action will not be dismissed at debate as irrelevant unless it must necessarily

fail even if all of the pursuers' averments are proved. Accordingly, it is appropriate to begin

with the pursuers' case on record.

The pursuers' case on record

[3]

The pursuers offer to prove, inter alia:

"In 2014 the pursuers were the heritable proprietors of [address] (the `Property').

They lived in it with their three children. In 2012 Mohammad Sharif (the `first

pursuer') was sequestrated. ... The first pursuer was anxious to find a way to

retain the family home. He agreed with his trustee in sequestration and the defender

that the defender would purchase the Property from the trustee. The first pursuer

arranged with family and friends to put the defender in funds to purchase the

Property. The defender purchased the Property from the trustee in sequestration.

There was a shortfall in the funds provided by friends and family and the defender

funded that shortfall by taking out a buy to let mortgage. The defender executed a

trust deed dated 13 May 2014 (the `Trust Deed'). The Trust Deed was drafted by the

defender's solicitor ... By the Trust Deed the defender acknowledged that although

he was the heritable proprietor of the Property he held it in trust for and on behalf

of the pursuers. The Trust Deed inter alia provided that when directed to do so the

defender would convey the Property to the pursuers or to such person or persons as

they might direct. William Meechan provided the pursuers with a copy of the Trust

Deed after it was executed. On 12 July 2014 the first pursuer assigned his interest

in the Trust Deed to Manawar Sharif (the `second pursuer') .... The first pursuer

intimated the Assignation to the defender in or around July 2014. He did so by

providing a copy of the Assignation to the defender. At this time, the first pursuer

had recently suffered a heart attack. He was concerned for his health and wished to

provide for his wife. He granted the assignation in order to ensure that his wife had

control of the Property in the event that his health were to deteriorate. He advised

the defender of this. The first pursuer further intimated the Assignation to the

defender in or around February 2017. At this time, the defender wished to arrange

for the transfer of the Property back to the pursuers. He wished to do so in order

to be able to repay the mortgage secured against the Property. It was proposed that

the Property would be transferred into the name of the second pursuer, as the sole

beneficiary of the Trust Deed at this point. The defender asked the pursuers to

provide him with copies of the documentation which put in place the trust

arrangement. The first pursuer obtained copies of the Trust Deed and Assignation.

... He provided copies of them to the defender at a meeting in or around

February 2017 .... In 2014 the pursuers signed a Short Assured Tenancy agreement

with the defender anent the Property (the `Tenancy Agreement'). The rent payable

under the Tenancy Agreement was to fund the sums due by the defender in terms of

the buy to let mortgage. ....

On 23 July 2019 the defender applied to the First Tier Tribunal (Property and

Housing Chamber) (`FTT') for an eviction order in relation to the first pursuer

and the Property (the `FTT Application'). The basis of the FTT Application was

that he wanted to sell the Property. This was prohibited by the Trust Deed.

Sheriff Officers served the papers on the first pursuer on 15 August 2019. The

pursuers did not have the funds to instruct a solicitor. The first pursuer prepared

written submissions and submitted them on 30 August 2019. The written

submissions contained no reference to the Trust Deed. The pursuers had no

physical record of the Trust Deed and could not remember its precise terms. A

Case Management Discussion took place on 20 September 2019. The pursuers

did not attend the hearing because they had arranged for a friend to appear on

their behalf. The FTT did not allow the friend to appear as a lay representative

because it had received no authority from the pursuers. The first pursuer emailed

the FTT following a call from the friend but sent the email to the wrong email

address in error. The FTT proceeded in the absence of the pursuers and granted

the eviction order on 20 September 2019 (`The FTT Decision'). ... The FTT

application was advanced on the basis that the defender intended to sell the

Property. The defender lodged an affidavit in the FTT proceedings asserting

that it was his intention to sell the Property. The FTT granted the FTT Decision

in reliance on the statements to the FTT that he intended to sell the Property. At

all material times, the defender was aware that by virtue of the Trust Deed he was

expressly prohibited from selling the Property without the consent of the pursuers.

The defender was aware that he did not have the consent of the pursuers to sell the

Property. The defender, knowingly and materially, misled the FTT. ... The decree

which this action seeks to reduce would not have been granted had it not been for

the defender misleading the FTT. ...

The first pursuer sought to have the FTT Decision recalled. The Application for

Recall was refused on 21 October 2019. The first pursuer sought permission to

appeal to the Upper Tribunal. The Permission to Appeal to the Upper Tribunal

application was refused on 23 January 2020 on the basis that it was late. The first

pursuer sought permission to appeal that decision to the Court of Session. The

Permission to Appeal to the Court of Session application was refused on 3 March

2020. In none of these appeals were the pursuers represented by solicitors. In

none of these appeals did the first pursuer make reference to the Trust Deed. ...

On or about 15 February 2023 the Second Pursuer raised proceedings in Paisley

Sheriff Court seeking to implement the Trust Deed. In that action the Second

Pursuer craves the Court to ordain the Defender to convey the Property to her.

The Defender has defended that action. ... That action remains ongoing. ..."

Submissions for the defender

[4]

Mr Tosh for the defender had provided the court with a note of argument in advance

of the hearing. Mr Tosh submitted that the FtT Decision was a decree in foro and as such

could only be reduced in exceptional circumstances where it was necessary to produce

substantial justice or avoid a miscarriage of justice. Mr Tosh submitted that the pursuers'

averments failed to disclose exceptional circumstances that justified reduction, in particular

(i) alternative methods of review of the FtT Decision had been available and no exceptional

circumstances were averred that excused the first pursuer's failure to use these and (ii) the

fact and terms of the Trust Deed were not res noviter and could not now be raised and, in any

event, even if they did bear upon the question of the entitlement of the defender to sell the

Property, that matter had been determined by the FtT and could not now be re-visited. Even

if the defender had mis-led the FtT, it was not now open to the pursuers to seek to re-litigate

the issue by reduction.

Submissions for the pursuers

[5]

Ms Roxburgh accepted that the FtT Decision was a decree in foro and that,

accordingly, reduction would be available only in exceptional circumstances. Ms Roxburgh

submitted that the one cannot define the categories in which reduction would be competent.

The proper approach was to examine the whole circumstances of the particular case to

determine whether there existed exceptional circumstances such that reduction was required

to achieve substantial justice. The court might be reluctant to allow a decree to stand where

a prima facia or substantive defence existed but has not been heard.

[6]

Turning to the pursuers' pleadings, Ms Roxburgh submitted that the pursuers'

pleadings advanced four key issues or points such that, if established, it could not be said

that no Lord Ordinary could hold that exceptional circumstances existed such as to warrant

reduction and that the action must necessarily fail.

[7]

The first related to the circumstances in which the defender came to hold the

Property. These were unusual. They arose out of the first pursuer's sequestration. The first

pursuer wanted to maintain his family in their family home. He had agreed to purchase the

Property from his trustee in sequestration. Family and friends had contributed towards the

purchase cost but there was a shortfall. The defender only became involved as he was able

to obtain a mortgage for the shortfall. The rent payable under the tenancy agreement was

set by reference to the mortgage premiums. Further, the use of the Trust Deed was

particularly unusual. Given the Trust Deed, the defender was not entitled to remove the

pursuers or sell the Property.

[8]

Second, the FtT Decision was granted where there had been no substantive

procedure in the proceedings. There was a substantive defence to the defender's application

that had not been heard. The Trust Deed prohibited the orders sought by the defender from

the FtT. Further, the FtT Decision was made at a case management hearing at which the first

pursuer was unrepresented. The first pursuer had taken steps to be represented but the FtT

refused to allow the first pursuer's nominated representative to appear due to the first

pursuer's email nominating him being sent to the wrong address.

[9]

Third, the defender raised proceedings before the FtT and sought the order for

eviction in full knowledge of the Trust Deed and that, as a consequence of the Trust Deed,

he was not entitled to evict or sell the Property. The defender represented to the FtT that

he met the statutory basis for seeking eviction, namely that he was entitled and intended

to sell the Property. In doing so, the defender concealed the Trust Deed from the FtT and

deliberately misled the FtT into granting the order for eviction.

[10]

Fourth, the second pursuer has raised proceedings at Paisley Sheriff Court seeking

implement of the Trust Deed. Questions of title would be determined as part of those

proceedings. Reduction was an equitable remedy. It would be inequitable to require the

second pursuer and her family to be evicted from the Property (in which they had lived

since 1999) under the FtT Decision only for it to be determined that the defender was obliged

under the Trust Deed to sell the Property to the second pursuer. In answer to a question

from me, Ms Roxburgh informed me that the pursuers had sought an undertaking from the

defender not to seek to evict pending resolution of the sheriff court action but the defender

had declined to grant such an undertaking.

Decision

[11]

In the case of Man Hen Liu v Andersons Solicitors LLP and Others [2017] CSIH 45

the Lord President (Carloway), giving the opinion of the court, citing Lord Abernethy in

Malcolm v Park Lane Motors 1998 SLT 1252, stated at para [19]:

"...reduction is competent if it is necessary to avoid a miscarriage of justice or,

to put it another way, to produce substantial justice. It is not possible to define

categorically the cases in which reduction is competent but it is clear that the

circumstances must be exceptional."

[12]

In Bain v Hugh L S McConnell Ltd 1991 SLT 691 at 965J, the Lord Justice-Clerk (Ross),

giving the opinion of the court, stated: "It is, in our opinion, well established that a decree

may be reduced in exceptional circumstances if reduction is necessary to produce

substantial justice."

[13]

In applying that test of substantial justice, the authorities disclose a number of

relevant propositions, including:

Reduction will be competent where it is necessary to achieve substantial justice

or avoid a miscarriage of justice.

ii.

It is not possible to define categorically the cases in which reduction is

competent.

iii.

Cases turns on their own individual facts and circumstances and little is to

be gained from extensive citation of other cases save as to highlight points of

principle or broader propositions.

Reduction of a decree in foro is only available in exceptional circumstances.

Reduction is a question of judicial discretion.

vi.

The existence of, or failure to use, an alternative remedy is not necessarily a bar

to reduction.

vii. The court should be reluctant to foreclose a substantive defence where this has

not been heard.

viii It might be a good ground for reduction where a party intentionally kept back

from the court a fact that materially undermined their entitlement to the orders

sought.

[14]

Turning then to the circumstances of this case in light of the propositions above.

I agree with Ms Roxburgh that the proper approach is to consider the whole facts and

circumstances of the case in the round, rather than taking a more deconstructionist approach

as argued for by Mr Tosh. In any event, the propositions narrated above answer the

criticisms advanced by Mr Tosh; at least at this stage in proceedings. Considering the facts

and circumstances averred by the pursuers and under particular reference to the four key

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You are here: BAILII >> Databases >> Scottish Court of Session Decisions >> MOHAMMAD SHARIF & ANOTHER AGAINST DR MOHAMMED MOUGHAL [2023] ScotCS CSOH_42 (30 June 2023) URL: http://www.bailii.org/scot/cases/ScotCS/2023/2023_CSOH_42.html Cite as: [2023] ScotCS CSOH_42, 2023 GWD 25-216, [2023] CSOH 42

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