Cabot Financial UK Ltd v McGregor
| Jurisdiction | Scotland |
| Judge | Sheriff Principal MM Stephen,Sheriff Principal IR Abercrombie,Sheriff Principal DL Murray |
| Judgment Date | 16 May 2018 |
| Docket Number | No 8 |
| Court | Sheriff Appeal Court |
| Date | 16 May 2018 |
[2018] SAC (Civ) 12
Sheriff Principal MM Stephen QC, PSAC, Sheriff Principal IR Abercrombie QC and Sheriff Principal DL Murray
AW, Applicant [2018] CSIH 25
Barton v Wright Hassall LLP [2018] UKSC 12; [2018] 1 WLR 1119
British Railways Board v Strathclyde Regional Council 1982 SLT 55; 1981 SLT 90
Cadbury Bros Ltd v Thomas Mabon Ltd 1962 SLT (Sh Ct) 28; 78 Sh Ct Rep 55
Hill v Black 1914 SC 913; 1914 2 SLT 123
McLeod v Prestige Finance Ltd [2016] CSOH 69; 2016 Hous LR 43; 2016 GWD 17–306
Mostaza Claro v Centro Móvil Milenium SL (C-168/05) EU:C:2006:675; [2006] ECR I-10421; [2007] Bus LR 60; [2007] 1 CMLR 22; [2007] CEC 290
Pannon GSM Zrt v Sustikné Győrfi (C-243/08) EU:C:2009:350; [2009] ECR I-4713; [2010] 1 All ER (Comm) 640; [2010] All ER (EC) 480; [2010] CEC 790
United Dominions Trust Ltd v McDowell 1984 SLT (Sh Ct) 10
Watson v Greater Glasgow Health Board [2016] CSOH 93; 2016 GWD 22–392
Wilson v First County Trust Ltd (No 2) [2003] UKHL 40; [2004] 1 AC 816; [2003] 3 WLR 568; [2003] 4 All ER 97; [2003] 2 All ER (Comm) 491; [2003] HRLR 33; [2003] UKHRR 1085; 100 (35) LSG 39; 147 SJLB 872
Bennion, FAR, Statutory Interpretation: A code (6th Jones ed, LexisNexis, London, 2013), sec 3.13
Department for Business, Innovation and Skills, Consumer Rights Bill: Explanatory Notes (HL Bill 29-EN) (TSO, London, June 2014), para 334 (Online: https://publications.parliament.uk/pa/bills/lbill/2014-2015/0029/en/15029en.pdf (6 July 2018))
Dobie, WJ, Law and Practice of the Sheriff Courts in Scotland (W Hodge, Edinburgh, 1948)
Macphail, ID, Sheriff Court Practice (3rd ed, W Green, Edinburgh, 2006), paras 2.09–2.17
Gill (Lord), Report of the Scottish Civil Courts Review (B60185) (Scottish Civil Courts Review, Edinburgh, September 2009), Ch 5 131 (Online: https://www.scotcourts.gov.uk/docs/default-source/civil-courts-reform/report-of-the-scottish-civil-courts-review-vol-1-chapt-1---9.pdf?sfvrsn=4 (6 July 2018))
Scottish Government, Courts Reform (Scotland) Bill: Policy Memorandum (SP Bill 46-PM) (Scottish Government, Edinburgh, February 2014) (Online: http://www.parliament.scot/S4_Bills/Courts%20Reform%20(Scotland)%20Bill/b46s4-introd-pm.pdf (6 July 2018))
Trayner, J, Latin Maxims and Phrases (4th Duncan ed, W Green, Edinburgh, 1998), p 438
Wallace, JF, “Interpretation of Statutes” in Stair Memorial Encyclopaedia: The Laws of Scotland (Butterworths/Law Society of Scotland, Edinburgh, 1991), vol 12, paras 1126, 1127
Process — Simple procedure — Decree — Pars judicis — Effect of failure to comply with ‘unless order’ — Whether sheriff entitled to refuse decree in undefended action — Act of Sederunt (Simple Procedure) 2016 (SSI 2016/200), sch 1, r 8.4
Cabot Financial UK ltd raised actions for payment against Robert McGregor, Liam Gardner and Kirsty Brown, in the sheriffdom of South Strathclyde, Dumfries and Galloway at Hamilton. Mr McGregor lodged an application to pay the sum claimed by instalments on 24 August 2017, to which the claimant consented on 28 August 2017. Mr Gardner and Ms Brown did not respond to the claims against them. The claimant sought orders for payment. The sheriff made an ‘unless order’ in each action requiring the claimant to lodge certain documentation within 28 days, which it refused to do. The sheriff dismissed the actions against Mr McGregor and Mr Gardner, on 15 September 2017. The summary sheriff fixed a hearing to take place in respect of the action against Ms Brown on 21 September 2017, and following submissions dismissed the action. The claimant appealed to the Sheriff Appeal Court.
Rule 8.4(1) of sch 1 to the Act of Sederunt (Simple Procedure) 2016 (SSI 2016/200) (‘SPR’) entitles the sheriff to order that, unless a party does something or takes a step, the sheriff will make a decision in the case, including dismissing the claim. Where such an order (an ‘unless order’) is not complied with, SPR 8.4(2) provides, “the decision in the case must be made”. The sheriff may also dismiss the claim if a party does not follow an order (SPR 8.5(1)(a)) or if the claim obviously has no real prospect of success (SPR 1.8(11)). Where parties are not legally represented, the sheriff must ensure that they are not unfairly disadvantaged (SPR 1.4(2)).
Three appeals were informally conjoined to deal with similar grounds of appeal in respect of the dismissal of undefended claims raised by the appellant (‘Cabot’) in respect of default under consumer credit agreements. The respondent, McGregor, lodged a time to pay application, to which Cabot consented. The respondents, Gardner and Brown, failed to respond to the claims made against them. In each of the three cases, the sheriff or summary sheriff made an ‘unless order’ requiring Cabot to lodge certain documents in support of the claims within 28 days, failing which the claims would be dismissed. The documents required were the original contract, the assignation and intimation thereof, and the default notice. In each case, Cabot refused to lodge the requested documents, on the basis that it was unnecessary to do so in undefended actions. The claims were subsequently dismissed in terms of SPR 8.4(2). In McGregor's and Gardner's cases, the sheriff dismissed the claim on the basis that Cabot had not demonstrated on the basis of the information supplied in the claim form that the respondent was due to pay the sum sought. In Brown's case, following a hearing, the summary sheriff relied upon Cabot's failure to comply with the unless order in terms of SPR 8.5(1)(a), and considered that the claim had no real prospect of success in terms of SPR 1.8(11). On appeal, the court appointed an amicus curiae in the absence of any contradictor.
Held that: (1) pars judicis referred to a judge's duty to notice ex proprio motu questions of jurisdiction and competency in respect of the form of proceedings or remedy sought, and whether a cause of action had prescribed, whereas questions of relevancy and specification did not normally fall within the court's inherent jurisdiction in the absence of an appropriate plea (paras 34, 35); (2) the intention of Parliament was to emphasise the court's active role in controlling how cases progressed by way of simple procedure and to assist the parties to reach settlement, rather than to extend the court's inherent jurisdiction to enquire into the merits of undefended cases or otherwise alter its approach to such cases, (paras 45, 50, 51); (3) the existence of a power to make an ‘unless order’ in undefended cases did not extend the sheriff's jurisdiction to question the relevancy and specification of claims (paras 49, 52, 72); (4) as the sheriff would not know whether a party had received legal advice, the duty to ensure that unrepresented parties were not unfairly disadvantaged was not engaged in an undefended claim (paras 51, 62, 63, 65); (5) notwithstanding the public interest in regulating claims under consumer credit agreements, the court was not required to investigate the enforceability of the agreement and it was not necessary to produce the contractual documentation at the commencement of the action (para 57); (6) in the present cases, the sheriff and summary sheriff had exceeded their powers by requiring contractual documentation to be produced and, because of its absence, by dismissing the claims rather than granting decree (para 57); and appeals allowed.
Observed that little was required for fair notice in a debt action, and the court ought not to dismiss an action ex proprio motu on the ground that the averments were irrelevant, even if plainly so, and material defects in specification did not render an action a fundamental nullity (paras 39).
Cadbury Bros Ltd v Thomas Mabon Ltd 1962 SLT (Sh Ct) 28 and McLeod v Prestige Credit Ltd2016 Hous LR 43considered.
The cause came before the Sheriff Appeal Court, comprising Sheriff Principal MM Stephen QC, PSAC, Sheriff Principal IR Abercrombie QC and Sheriff Principal DL Murray, for a hearing, on 12 March 2018.
At advising, on 16 May 2018, the opinion of the Court was delivered by Sheriff Principal MM Stephen QC, PSAC—
Opinion of the Court— [1] The appellants, Cabot Financial UK Ltd (‘Cabot’), raised separate proceedings against the respondents McGregor, Gardner and Brown for payment of various sums due under a mail order credit agreement which each of the individuals entered into with another company (JD Williams & Co Ltd). Cabot state that each agreement is regulated under the Consumer Credit Act 1974 (cap 39) (‘the 1974 Act’) by which the respondent borrowed a sum of money repayable on demand. They also state that the original supplier (JD Williams) assigned all rights in the debt to Cabot on particular dates and that the respondents had been advised of that. The basis upon which various sums are now due and payable is because the respondents are each in breach of the original contract having failed to pay, as agreed, on demand. The respondents all live in Lanarkshire and the ‘proceedings’ are simple procedure claims lodged and registered at Hamilton Sheriff Court in compliance with sch 8 to the Civil Jurisdiction and Judgments Act 1982 (cap 27).
[2] Simple procedure is a new procedure in the sheriff court for determining claims with a value of £5,000 or less. The procedure was introduced by sec 72 of the Courts Reform (Scotland) Act 2014 (asp 18) (‘the 2014 Act’). The Simple Procedure Rules (‘SPR’) are made by Act of Sederunt (Simple Procedure) (SSI 2016/200) and came into force on 28 November 2016. Schedule 1 contains the rules for simple procedure cases and sch 2 the forms to be used by parties and the court. The Rules have been amended by Act of Sederunt (Rules of the Court of Session 1994 and Sheriff Court Rules Amendment) (No 4) (Simple Procedure) 2016 (SSI 2016/315).
[3] The three appeals calling before us had been informally conjoined...
To continue reading
Request your trial