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	Scottish Sheriff Court Decisions
You are here: BAILII >> Databases >> Scottish Sheriff Court Decisions >> Bluestone Estates v. Fitness First Clubs Ltd [2003] ScotSC 40 (02 July 2003) URL: http://www.bailii.org/scot/cases/ScotSC/2003/40.html Cite as: [2003] ScotSC 40

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The Sheriff having resumed consideration of the cause, in the action, finds that the pursuers' averments in relation to personal bar are irrelevant and lacking in specification; therefore sustains the defenders' plea in law 4; Dismisses the action; Finds the pursuers liable to the defenders in the expenses of the action; Appoints an account thereof to be given in and Remit the same, when lodged, to the Auditor of Court to tax and to report.

11. I was referred further to Lord Chancellor Birkenhead's speech in Gatly -v- Maclaine (supra para (9)) at p.6:-

"[I]t would be a very singular circumstance if he, who had been careful to stipulate that certain payments of interest under an instrument of this kind should be made to him punctually upon a certain specified day, were deprived by a decision of the Law Courts of the right of visiting upon the strict implement of that for which he had so stipulated. It would be both undesirable and dangerous that Courts of Law should set up an elastic, and, from the nature of the case an undefinable, judicial discretion in substitution for the expected agreement of the parties to the instrument."

12. So far as the timing of the notice to resile was concerned Mr Davidson referred to Morrison -v- Gray 1932 SC 712 where missives to purchase a house had been concluded and a disposition prepared by purchaser was signed by the seller but not delivered to the purchaser. A dispute arose with regard to feu duty and it was held that the purchaser was not bound by his actings from refusing to complete the transaction.
13. When this case had been in the Outer House before Lord Moncrieff he noted at p.715:-

"I do not think however, that the disposition, while remaining undelivered, can be used as an adminicle of evidence to show that the defender has renounced or has barred himself from pleading his rights under the only contract by which he was bound. His law agents may have supposed to have prepared the deed under reference to the titles of the property, and without sufficient regard to the express terms of the defenders' own missive letter. Had the transaction been completed, the defender would have required to abide by the consequences of any such inattention: but I do not think any attention of the law agents to the terms of the language which had been used by the defender himself can found an argument against the defender excluding him from maintaining what he had made his offer subject to the ordinary interpretation of the words in which that offer was made. It is true, no doubt, that the defenders' objection to the title appears to be nothing better than an afterthought. Nonetheless I am of the opinion that, up to the actual conclusion of the bargain, such an objection was timeously stated".

14. I was also referred to the opinion of Lord Justice-Clerk (Alness) at p.717:-

"The pursuer maintained, in the first place, that the defender was, in the circumstances, barred from repudiating his contract. Now, a plea in bar is, generally speaking, supported by distinct averments of fact which give rise to and warrant it. I can find no such averments by the pursuer in this record. It was however, contended on his behalf that the defender had, before the disposition was tendered to him, obtained the titles to the property, which disclosed that there had been no allocation of the feu duty; that the defender thereafter prepared and signed the disposition; that he accepted the keys of the house; that he did not, in the course of correspondence which passed between the parties' agents prior to the raising of the action, state the objection now maintained by him; and that in point of fact it was not till the adjustment of the record that he tabled the objection on which he now stands. The pursuer therefore contended that the objection came too late........

I am satisfied that the defender never agreed, expressly or by implication, to accept the area house on a condition regarding the feu-duty other than the missives plainly bear. I am of the opinion that, till delivery of the disposition of the subjects to the defender and acceptance of it by him, he was entitled to resile from his contract........The Lord Ordinary was, I think, right in holding that "up to the actual conclusion of the bargain" the defender's objection was good and was timeously stated."

15. Similarly Lord Ormidale at p.719 said:-

"In my opinion the defender must have possessed a very intimate knowledge in regard to the actual position of the feu duty of £3.10s., and the circumstances generally are at least calculated to suggest that he merely was endeavouring, very late in the day, to find an excuse for evading his bargain, and to go back on a position conceded by him earlier in the transaction as correctly representing the agreement of parties...............

On the whole matter, as the disposition has remained in the custody of the pursuer and undelivered, I feel constrained to hold that the defender was not barred from taking exception to the title offered to him, and that his right to resile remained open to him until the disposition actually passed into his hands as purchaser."

16. Mr Davidson submitted that in the present case the continuation of the planning appeal process was not a positive step as was required to meet the test set out in Gatly -v- Maclaine (supra). Despite the passage of time from July 2001 when Aberdeen City Council had refused the planning application until the defenders resiled on 22 April 2002 nothing positive had been done by the defenders. Had the planning application been granted at the outset or the appeal determined by 31 December 2001 this would have been a different matter.
17. I was next referred to William Grant & Sons Ltd -v- Glen Catrine Bonded Warehouse Ltd 2001 SC 901 which inter alia deals with personal bar by acquiescence. In Lord Nimmo-Smith's opinion at p.938 para [4] having referred to Cairncross -v- Lorimer (1860) 3 Macq 827, Lord Chancellor Campbell at p. 835 and Gatly -v- Maclaine (supra), Lord Chancellor Birkenhead at p.7 stated:-

"It appears to me to be entirely clear from these and other authorities that in order for a defender to succeed in a plea of acquiescence he must be able to establish a causal relationship between the pursuer's failure to act and his own actings; that he would not have acted as he did if the pursuer had not induced a reasonable belief that he consented to his doing so. In the present case the defenders' plea of acquiescence must fail because proof of this essential feature is lacking; indeed they never offered to prove it."

18. Reference was made also to the opinion of Lord Clarke at p 942B para [3] who after quoting the speech of Lord Chancellor in Cairncross -v- Lorimer (supra) at pp 829-830 stated:-

"It is, in my judgement, an essential element of the doctrine of acquiescence that the party pleading it, in order to prevent an otherwise legal right being enforced against him, or to avoid the consequences of what otherwise would have been a wrong committed by him, can show that (a) the actings, works, or inaction of the person seeking to enforce the right, or seeking a remedy for its infringement, have, as a matter of fact, induced him into a reasonable belief that the right would not be enforced or that no claim would be taken in respect of any infringement thereof and that (b) as a consequence of that inducement, he has in some way altered his position in reliance on that reasonable belief. The essential element in the paradigm case of acquiescence is conduct, or inaction (sometimes described as standing by), by one person which actually induces another to have a reasonable belief upon which that other person places reliance and proceeds to alter his circumstances."

19. It was Mr Davidson's contention that there were no costs on which the Pursuers could rely to show what had been incurred as a result of the Defenders' actings or inaction. There was mention in the pleadings of £1,650 plus VAT legal fees having been incurred by the Pursuers in the period from 1 January 2002 but there was nothing averred to indicate the Pursuers had been induced to undertake this expense in the belief that the lease would be entered into.
20. All there was, Mr Davidson submitted, was the passage of time. He referred again to Lord Clarke's opinion in William Grant & Sons Ltd -v- Glen Catrine Bonded (supra) at page 942D para [4]:-

"It was agreed........that acquiescence is but one particular example of the general doctrine of personal bar, which is an equitable doctrine, and which, in my judgement, speaking generally, may come into play where the law considers it inequitable that a man who has represented a state of facts and his representation has induced another both to believe in this state of facts and to arrange his affairs as a result thereof, should be later allowed to go back on that representation. I accept........................that the equitable basis of all pleas of personal bar is rooted in the notion that a litigant should not be permitted to come to court and deny what he has previously affirmed. But, since the effect of acquiescence may be to obliterate, for practical purposes, what are otherwise perfectly valid and subsisting legal rights, the equities require, in my judgement, that if a person's rights are to be so obliterated, he has induced, in some way, others to believe that he was no longer interested in enforcing his rights against them and that they have altered their position in reliance on that belief. I prefer in this context to use the expression "altered their position" rather than the words "acted to their prejudice" since, it seems to me, that an analysis of the authorities, which were placed before us, demonstrate that the doctrine may operate, provided reliance has been placed on the representation, even though what may ordinarily be described as prejudice to the party so relying has not occurred."

21. Mr Davidson said that in answer to the contention that the Defenders failed to resile within a reasonable time, there was nothing in the missives to define what a reasonable time should be. The offer to purchase specified that either party would be entitled to resile from the missives if, inter alia, planning permission for a change of use was not in place by 31 December 2001. Time was said to be of the essence in the missives and no "reasonable time period" was specified.
22. Reference was made to Ford Sellar Morris Properties -v- Hutchison 1990 SC 34 and the authorities referred to therein where a date had been fixed and made the essence of the contract, as a consequence, the defenders were entitled to resile within a reasonable time. It had been held that, sending a letter resiling from the bargain within 8 days of the cut-off date could not "be regarded as being in any way excessive." (Lord Sutherland at p.37.)
23. In James Howden -v- Taylor Woodrow 1998 SC 853 the Inner House approved the approach of Lord Sutherland in Ford Sellar Morris Properties -v- Hutchison (supra) Lord Kirkwood stating in Howden at p. 871F "I tend to the view that the Lord Ordinary was correct in holding that, whether viewed as a question of construction or the addition of an implied term if such party became entitled to resile ..................then the right required to be exercised within a reasonable time." A delay of more than 2 years before serving a purported notice to resile was held to be excessive.
24. Mr Davidson did point out that Lord Marnoch while agreeing with the decision of the Court had a different opinion in this context at p. 874 B:-

"The test for implying a term in a contract is clearly a very high one and, in the present case, I do not consider that there is any obvious need to read into the contract that the right to resile should be exercised "within a reasonable time". In particular, I have in mind that in any normal situation abuse would be prevented through an application of the principles of mora and personal bar, if not by the law of prescription. The particular circumstances which developed in the present case were, of course, very special indeed and personal bar could not be invoked for the simple reason that, even after July 1990 the parties agreed to continue negotiations on a "without prejudice" basis. This, however, should not be allowed to colour the need, or otherwise, for implying a term into the contract while matters were still entire."

25. Mr Davidson accepted that the question of what was a "reasonable time" was a difficult matter and in many instances it would be necessary to hear evidence to decide the underlying faults. First of all one had to look at the pleadings to determine what the facts might be. While Rodger (Builders) Ltd -v- Fawdry & Others 1950 SC 483 was authority for the proposition that in a conveyancing transaction the seller could not resile if the purchase price was not paid on the due date, in the present case the missives specified the date by which conditions including the obtaining of planning permission had to be in place. The contract also declared that in that regard "time is of the essence".
26. Neither party could resile until the particular date, namely 31 December 2001, had passed. There was nothing in the pleadings to indicate that the Pursuers had sought to limit the reasonable period of time after 31 December 2001 during which the Defenders might seek to resile and give a reasonable ultimatum. None of the steps suggested by Lord Sorn in Rodger -v- Fawdry (supra) seemed to have taken place and there was nothing in the pleadings to show any positive steps after 31 December 2002.
27. There had, to paraphrase Rankine on Personal Bar at P. 1, been "no words spoken" or acts at all that a reasonable man could have taken to amount to personal bar and accordingly there was no need for a proof. Fair notice demanded that the defenders had to know what was being founded upon if the test laid down in Gatty -v- Maclaine (supra) was to be met.
28. In that there had been no words or conduct by the Defenders prior to the letter resiling from the bargain, the Pursuers had no justification for believing or acting to their prejudice in relation to matters after 31 December 2001. The Pursuers needed to be able to find upon words spoken, acts or conduct which led them to believe the Defenders were intent on proceeding after 31 December 2001. Nothing had been produced or averred to that effect.
29. It was clear from the specific terms of the contract that each party had at the end of 2001 the right to resile and there was nothing in the pleadings upon which The Pursuers could base a plea of personal bar. Mr Davidson also submitted that the right to resile had been exercised within a reasonable time and the period from 31 December 2001 to 22 April 2002 could not be said to be excessive.
30. It was Mr Davidson's contention that there were insufficient grounds to hold a proof before answer and accordingly moved for the Defenders' 3^rd and 4^th pleas in law to be sustained.

PURSUERS' SUBMISSIONS

31. Mr Henderson indicated that he was seeking to have a proof before answer fixed. He accepted that in terms of the missives certain conditions required to have been met by 31 December 2002. The obtaining of planning permission for the site in question was one of the conditions which if not in place could lead to either party being able to resile after 31 December 2001.
32. Mr Henderson contended that the Pursuers were entitled to proceed to a proof and seek damages following the Defenders' purporting to resile from the missives. The issue of whether or not the defenders were entitled to resile was a matter for evidence.
33. I was referred to Rankine on Personal Bar at p. 1 which quotes from the speech of Lord Blackburn in Buchanan -v- Duke of Hamilton (1878) 5R HL at p. 82:-

"According to the law of England & Scotland, if the one has so conducted himself - has so spoken and so acted - that if he had been a reasonable man he would have known that the other side believed that he did agree to certain terms, and if the other side did in fact, in consequence of his so acting, believe it, it matters not that the man did not really mean to do it. He would be, as it is said in Scotland, personally barred from disputing that he was bound by the terms which the other side had been led to believe were the terms relied upon by him...............The idea is the same in both countries, and it is founded on perfect justice."

34. Mr Henderson referred to Ford Sellar Morris -v- Hutchison (supra) Lord Sutherland at p. 37 where His Lordship had quoted from the speech of Lord Jenkins in Aberfoyle Plantations Ltd -v- Cheng [1960] AC115 at p. 124:-