Ecclesiastical Insurance Office Plc Against Lady Iam Hazel Virginia Whitehouse-grant-christ
| Jurisdiction | Scotland |
| Judge | Lord McGhie,Lord Drummond Young,Lady Paton |
| Neutral Citation | [2016] CSIH 12A |
| Date | 02 March 2016 |
| Docket Number | A2852/00 |
| Court | Court of Session |
| Published date | 02 March 2016 |
EXTRA DIVISION, INNER HOUSE, COURT OF SESSION
[2016] CSIH 12A
A2852/00
Lady Paton
Lord Drummond Young
Lord McGhie
OPINION OF THE COURT
delivered by LORD McGHIE
in the cause
ECCLESIASTICAL INSURANCE OFFICE PLC
Pursuers and Respondents;
against
LADY IAM HAZEL VIRGINIA WHITEHOUSE-GRANT-CHRIST
Defender and Reclaimer:
Pursuers and Respondents: R Dunlop QC; Clyde & Co
Defender and Reclaimer: Party
2nd March 2016
[1] This is an appeal by way of reclaiming motion from a decision of the Lord Ordinary following debate. The case is about a disputed insurance claim arising from a fire. The issues at this stage relate to time-bar and delay. The pursuer insurance company had raised an action seeking to avoid the policy. The insured defended that action but did not submit a formal counterclaim for payment until some ten years after the event. The substantive dispute before us was whether a claim made by way of a plea in law and not in any formal conclusions was sufficient to interrupt the prescription provided by section 6 of the Prescription and Limitation (Scotland) Act 1973. There was a further dispute over a claim by the defender for defamation and whether that could be allowed to proceed when made outwith the three year period provided by section 18A of the Act. There was also a general plea about delay.
Statutory provisions
[2] Prescription and Limitation (Scotland) Act 1973 (“the 1973 Act”)
Reference was made to the following provisions of the 1973 Act:
“Section 6 (1) ‘If, after the appropriate date, an obligation to which this section applies has subsisted for a continuous period of five years—
(a) without any relevant claim having been made in relation to the obligation, and
(b) without the subsistence of the obligation having been relevantly acknowledged,
then as from the expiration of that period the obligation shall be extinguished: ….
Section 9 (1); In sections 6, 7 and 8A of this Act the expression ‘relevant claim’, in relation to an obligation, means a claim made by or on behalf of the creditor for implement or part-implement of the obligation, being a claim made—
(a) in appropriate proceedings, ….
(2) In section 8 of this Act the expression ‘relevant claim’, in relation to a right, means a claim made in appropriate proceedings by or on behalf of the creditor to establish the right or to contest any claim to a right inconsistent therewith. ….
(4) In this section the expression ‘appropriate proceedings’ and, in relation to an arbitration, the expression “the date when the arbitration begins” have the same meanings as in section 4 of this Act.
Section 4 (2) In this section ‘appropriate proceedings’ means—
(a) any proceedings in a court of competent jurisdiction in Scotland or elsewhere, except proceedings in the Court of Session initiated by a summons which is not subsequently called;
Section 18A(1) Subject to subsections (2) and (3) below and section 19A of this Act, no action for defamation shall be brought unless it is commenced within a period of 3 years after the date when the right of action accrued.
Section 19A(1) Where a person would be entitled, but for any of the provisions of sections 17, 18, 18A or 18B of this Act, to bring an action, the court may, if it seems to it equitable to do so, allow him to bring the action notwithstanding that provision.”
[3] All further references to statutory provisions are to these provisions of the 1973 Act unless specific reference is made to any other provision.
[4] The following provisions of the Court of Session Act 1988 Act were mentioned.
“6. With a view to securing that causes coming before the Court may be heard and determined with as little delay as possible, and to the simplifying of procedure and the reduction of expense in causes before the Court, the Court shall, in the exercise of the powers conferred on it by section 5 of this Act, provide by act of sederunt –
…..
(v) for the inclusion in defences to any action of any counter claim arising out of the matters on which the action is based, to the effect of enabling such counter claim to be enforced without a separate action being raised”.
For completeness it may be noted that these provisions were repealed with effect from 1 April 2015 by the Courts Reform (Scotland) Act 2014. The repeal has no direct bearing on the issues before us.
Authorities
Advocate General for Scotland v Murray Group Holdings Ltd 2015 SLT 765.
Dryburgh v Scotts Media Tax Ltd 2014 SC 651
Highlands and Islands Airports Ltd v Shetland Islands Council 2015 SLT 285
Link Housing Association v PBL Construction Ltd 2009 SC 653,
M.R.S. Hamilton v Baxter 1998 SLT 1075
Union Electric Co v Holman & Co 1913 SC 954
Wylie v Avon Insurance Co. Ltd & another 1988 SCLR 570.
Text books
Johnston Prescription and Limitation 2nd Ed
Background
[5] The following short summary of facts is uncontentious and sufficient to set the present issues in context.
[6] The defender arranged insurance for her home with the pursuers. The property was badly damaged by fire on 13 February 2000. She immediately intimated a claim. There was no dispute as to the accidental cause of the fire and reports were obtained with a view to agreeing quantum. However, by letter of 2 October 2000, the pursuers intimated that the claim was rejected on the basis that they were entitled to repudiate the policy on grounds of non-disclosure. The defender did not accept that there had been any relevant non-disclosure. The pursuers accordingly raised the present action for declarator that they were entitled to avoid the policy.
[7] The defender resisted the declarator. She set out, in considerable detail, her reasons for disputing the pursuers’ right to avoid the policy. On 27 May 2002 she intimated adjustments by way of a document called “adjustments for the defender”. These included a plea in law in the following terms:
“9. On the grounds of1,2,3,4,5,6,7,8 above, the pursuer not being entitled to avoid the policy, a decree Ad factum praestandum (an order for specific implement) should be granted requiring the pursuer to perform the pursuers contractual obligations in accordance with the Policy No. HT 98002073 issued by the pursuer in favour of the defender.”
We shall refer to the claim made in this way, at that time, as “plea 9”.
[8] It may be noted at this stage that the pursuers did not dispute that if a claim in identical terms to plea 9 had been presented in the form of a counterclaim at that time this would have interrupted the quinquennium. The substantive issue was whether the intimation of adjustments in these terms was a relevant claim within the meaning of section 6(1)(a).
[9] On 31 October 2002 the action was sisted at the defender’s instance to allow her to apply for legal aid. The defender suffered poor health. This was apparently exacerbated by the stress and anxiety of the disputed claim. She was in hospital for a time. She was unable to obtain legal aid. The pursuers made no attempt to recall the sist. The defender did so in about March 2012. She lodged a counterclaim. She adjusted to delete many of the averments in the defences as they were effectively duplicated in the counterclaim. It was not suggested that anything turned on the detail of pleading at that point. It was plain that the counterclaim was well outwith the quinquennium.
[10] The counterclaim included various claims based on defamation which had not been in the previous pleadings. In the appeal it was not disputed that no relevant claim had been made in respect of any relevant defamation within three years of publication. There is an issue between the parties as to the extent of privilege attaching to some of the statements complained of and the pursuers assert that the statements were, in any event, true or fair comment. However, in relation to the defamation claims the only issue before us was whether the Lord Ordinary had erred in the exercise of his discretion not to permit the defender to bring an action late and over-ride the time-limit in terms of section 19A.
[11] The Lord Ordinary heard parties in debate on the issues of prescription, limitation and delay and by interlocutor of 19 February 2015 dealt with various pleas, granted declarator that any obligation on the part of the pursuers arising under the policy had been extinguished by the short negative prescription under and in terms of section 6 of the 1973Act and dismissed the defender’s counterclaim.
Submissions for defender
[12] The defender accepted that the grounds of appeal could be described as falling under three distinct heads: first, has her claim for indemnity under the policy been lost by prescription; second, should the defamation claim have been allowed late; and third, should the pursuers’ case be dismissed under any Human Rights provisions because of the long delay.
[13] The argument under the first head turned on the proposition that plea 9 was effective to interrupt the running of the prescriptive period. This was the main issue at the hearing before us. In relation to the claim of defamation, the Lord Ordinary held that there was no timeous claim under section 18A and this was not challenged in the grounds of appeal. The argument was that he exercised his discretion wrongly under section 19A. The defender did not address us on this but adopted her written submissions. The third head of argument in respect of delay was based on the proposition that although it was on the defender’s motion that the action was sisted, the action should be dismissed on the ground of delay and the pursuers’ failure to prosecute their claim properly. The defender again rested on her written submissions.
[14] It may be noted that the defender set out various submissions in her written note of argument under reference to section 11 of the 1973 Act. It was not clear that this supported any of her grounds of appeal but she clarified the matter by confirming that it related to her defamation...
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Ecclesiastical Insurance Office Plc Against Lady Iam Hazel Virginia Whitehouse-grant-christ
...Drummond Young and Lord McGhie) for a hearing on the summar roll. At advising, on 2 March 2016, the court allowed the reclaiming motion ([2016] CSIH 12A; 2016 SLT 990). The cause called by order before an Extra Division on 22 September 2016 at which time the defender sought an order from th......