Apollo Engineering Limited V. James Scott Limited
| Jurisdiction | Scotland |
| Judge | Lady Paton |
| Judgment Date | 18 January 2012 |
| Neutral Citation | [2012] CSIH 88 |
| Date | 27 November 2012 |
| Published date | 27 November 2012 |
| Court | Court of Session |
| Docket Number | XA156/07 |
| EXTRA DIVISION, INNER HOUSE, COURT OF SESSION | |
| Lady Paton Lord Menzies Lord Bracadale | [2012] CSIH 88 XA156/07 OPINION OF THE COURT delivered by LADY PATON in the cause APOLLO ENGINEERING LIMITED Appellants; against JAMES SCOTT LIMITED Respondents: _______________ |
Proposer of two motions: G Politakis, director and shareholder of Apollo Engineering Limited
Appellants: No appearance
Respondents: Ellis QC; MacRoberts LLP
Amicus curiae: Springham
27 November 2012
Introduction[1] The appellants ("Apollo") are currently engaged in an arbitration with the respondents ("Scott"). In the course of that arbitration, a case was stated for the opinion of the Court of Session in terms of section 3 of the Administration of Justice (Scotland) Act 1972. However Apollo's funds ran out. As a result Mr Politakis, a shareholder and director of Apollo, enrolled a motion seeking "a court order under Article 6 of the ECHR which would allow [him] to represent [Apollo] in any future court proceedings [and in] particular ... in relation to the forthcoming Stated Case procedure". Having heard a debate on 7 and 8 July 2011, this court ruled that Mr Politakis could not represent his company in court proceedings (Apollo Engineering Limited (in liquidation) v James Scott Limited [2012] CSIH 4).
[2] Mr Politakis now seeks leave to appeal that ruling to the Supreme Court. Further he wishes to move a motion which he had previously enrolled in June 2011 (and subsequently amended on 18 April 2012) in the following terms:
"Apollo Engineering Limited has no assets nor can it raise any further cash to instruct law agents and counsel. Apollo has now assigned to Mr Politakis the damages due by Scott. In line with the Minute of Sist and in terms of Article 6 and Article 1 Protocol 1 of the ECHR, I respectfully crave the court to (a) sist myself, Gabriel Politakis, in room and place of Apollo Engineering Limited in the overall action of James Scott Limited v Apollo Engineering Limited and in the current Arbitration proceedings (b) if the court refuses (a), then as an alternative to sist me as a party to the said action and arbitration and give me the authority to personally implement the suit against Scott."
[3] Scott opposed both motions. Scott also enrolled two motions, one for an award of the expenses of the hearing on 7 and 8 July 2011 against Mr Politakis personally, and the second, for dismissal of the Stated Case in respect that Apollo has no funds and will be unable to instruct legal representation for the main hearing which is expected to last 8 days.
[4] The court ex proprio motu invited Mr Politakis to make submissions, although not a party to the action.
Mr Politakis' motion for leave to appeal to the Supreme Court[5] Mr Politakis moved the court to grant him leave to appeal to the Supreme Court. His application to represent his company in court had been much broader than the current Stated Case proceedings. He had sought a court order allowing him to represent Apollo "in any future court proceedings". Accordingly the decision in John G McGregor (Contractors) Ltd v Grampian Regional Council 1991 SC (HL) 1 did not present an obstacle, as his motion was not restricted to the Stated Case proceedings. The question at issue was important.
[6] Senior counsel for Scott submitted that it was not competent to appeal to the Supreme Court from Stated Case proceedings arising from an arbitration. Reference was made to John G McGregor (Contractors) Ltd, cit sup. In any event, this court's decision on 18 January 2012 was that, esto the court had the power to permit Mr Politakis to represent his company, the court would not have exercised that power in his favour, for the reasons set out in paragraphs [35] to [43] of Apollo Engineering Ltd (in liquidation) v James Scott Limited, cit sup. Accordingly any discussion about the nature and extent of the court's powers would be academic in this particular case, and by definition an unsuitable matter for the Supreme Court.
[7] The amicus curiae agreed with Scott's submissions, and also referred to Lord Hope's article on arbitration as revised in Release 17 (February 2012) of Macfadyen on Court of Session Practice, which confirmed that an appeal to the Supreme Court from such Stated Case proceedings was incompetent.
[8] Decision: leave to appeal to the Supreme Court: There is clear authority that there can be no appeal to the House of Lords or to the Supreme Court from any opinion of the Inner House in response to a Stated Case in terms of section 3 of the Administration of Justice (Scotland) Act 1972 (John G McGregor (Contractors) Ltd, cit sup and the article by Lord Hope in Macfadyen Court of Session Practice, Division J, Chapter 1, paragraph [3]). We agree with counsel for Scott and with the amicus curiae that this authority applies a fortiori to ancillary and interlocutory rulings within the Stated Case procedure. Mr Politakis enrolled his motion concerning his representing his company in the Stated Case procedure (process no X156/07), and his motion is, in our view, governed by John G McGregor (Contractors) Ltd, cit sup. For that reason alone, we refuse to grant leave to appeal to the Supreme Court. Further, however, it is our view that only matters raising an arguable point of law of general public importance should be sent to the Supreme Court. In the present case this court considered all the circumstances of the case and concluded that, even if it had the power to do so, it should not exercise that power by granting Mr Politakis' motion, for the reasons set out in paragraphs [35] to [43] of the opinion [2012] CSIH 4. Thus putting aside any question of the incompetence of an appeal, we would not have considered this an appropriate case in which to grant leave to appeal to the Supreme Court, as any discussion of the court's powers would in our view be academic to the outcome. We are not therefore prepared to grant leave to Mr Politakis to appeal to the Supreme Court.
Mr Politakis' motion to be sisted[9] Mr Politakis relied upon several legal bases in order to justify his being sisted to the court and arbitration proceedings. (a) Apollo had granted him assignations of the claim dated 18 April, 28 May, and 11 June 2012 in place of the company. (b) In any event, the court should in the circumstances make an order sisting Mr Politakis as a party with authority to implement the suit against Scott. (c) Further, Mr Politakis should be sisted to the proceedings in his capacity as dominus litis. (d) Finally as a director of Apollo, he should be deemed to be part of the composite persona of Apollo, with in effect a power of attorney, and as such entitled to be sisted in place of Apollo.
[10] Assignations: Three assignations were made available to the court. The first, dated 18 April 2012, was signed by a Mr Tucker of 8 Wemyss Crescent, Troon. We were advised that Mr Tucker had assisted Mr Politakis in raising funds for the litigations, but that he had no connection with Apollo. Mr Politakis explained that Mr Tucker had been intended to be a witness to the deed. Mr Politakis was content not to attempt to rely upon that assignation.
[11] The two other assignations were in the following terms:
SUPPLEMENTARY ASSIGNATION
by
APOLLO ENGINEERING LIMITED
in favour of
GABRIEL POLITAKIS ESQ
May 2012
We, Apollo Engineering Limited ... (the Company) IN CONSIDERATION of part of the same sum of TWELVE THOUSAND FIVE HUNDRED POUNDS (£12,500) paid in relation to the Damages Assignation dated 18 April 2012 of which sum hereby [sic] acknowledge payment was made on behalf of the Company to the Arbiter, one John D Spencely CBE, by Mr & Mrs Politakis ... do hereby ASSIGN and MAKE OVER to Mr Gabriel Politakis the part of the sums due to the Company by James Scott Limited ... which are deemed not to be included in the Damages Assignation and we the Company grant warrandice; IN WITNESS WHEREOF
[Signed by G Politakis
28 May 2012]
ASSIGNATION
by
APOLLO ENGINEERING LIMITED
in favour of
GABRIEL POLITAKIS ESQ
April 2012
We, Apollo Engineering Limited .... IN CONSIDERATION of the sum of TWELVE THOUSAND FIVE HUNDRED POUNDS (£12,500) STERLING of which sum hereby [sic] acknowledge payment was made on behalf of the Company to the Arbiter, one John D Spencely CBE, by Mr & Mrs Politakis ... do hereby ASSIGN and MAKE OVER to Mr Gabriel Politakis the damages due to the Company by James Scott Limited ..., and we the Company grant warrandice; IN WITNESS WHEREOF
[Signed G Politakis
11 June 2012]
[12] Mr Politakis acknowledged that Scott's position was that the assignations were invalid and ineffective because of a prohibition against assignations contained in the parties' sub-contract. The relevant clause in the sub-contract was as follows:
"2 Execution of Sub-Contract work
... (e) The Sub-Contractor [Apollo] shall not assign the benefit of the Sub-Contract nor sublet the whole or any part of the Sub-Contract works without the prior written consent of Scott."
Mr Politakis contended, first, that as Scott were in repudiatory breach of the sub-contract, they could not rely upon Clause 2(e). Secondly and in any event, properly construed, the clause prohibited the assignation of the "performance" of the contract, but not the "fruits" or "benefit" of the contract (including the several million pounds owed to Apollo for its completed performance). Reference was made to the non-assignation clause in Flood v Shand Construction Ltd and others [1997] 81 BLR 31. Mr Politakis accepted that the Flood clause contained a proviso, namely:
" ... Provided always that the Sub-Contractor may without [the previous written consent of the Contractor] assign either absolutely or by way of charge any sum which is or may become due and payable to him under this Sub-Contract."
Mr Politakis submitted that a similar proviso must be implied in the sub-contract between Scott and Apollo. Accordingly the assignations were valid and were not struck at...
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