Fieldoak Limited (in Receivership) Against Citywide Glasgow Limited
| Jurisdiction | Scotland |
| Judge | Lady Wolffe |
| Neutral Citation | [2017] CSOH 138 |
| Date | 27 October 2017 |
| Docket Number | CA86/16 |
| Court | Court of Session |
| Published date | 27 October 2017 |
OUTER HOUSE, COURT OF SESSION
[2017] CSOH 138
CA86/16
OPINION OF LADY WOLFFE
In the cause
FIELDOAK LIMITED (IN RECEIVERSHIP), a company incorporated under the Companies
Acts (Company Number SC161516) and having its registered office at Citywide Estates, 1016
Cathcart Road, Mount Florida, Glasgow G42 9XL
Pursuer
against
CITYWIDE GLASGOW LIMITED, a company incorporated under the Companies Acts
(Company Number SC330299) and with its registered office at 1016 Cathcart Road, Mount
Florida, Glasgow G42 9XL
Defender
Pursuer: Sellar QC, Barne; HBJ Gateley
Defender: Logan; Campbell Smith LLP
27 October 2017
Background
[1] This case concerns a dispute between the pursuer, a property company now in
receivership, and the defender, the letting agent (as the defender would have it) or the
former letting agent (as the pursuer contends) under a management agreement after-
mentioned.
2
The Properties
[2] The pursuer was in the business of acquiring and letting mainly residential property.
The properties comprised 107 residential properties and five commercial properties in or
around Glasgow (together "the Properties"). The Properties fall into three categories.
(i) The first category comprises 19 properties, in respect of which the pursuer
granted individual licences to occupy in favour of YMCA Glasgow, trading as
Y People ("Y People" and "the Y People Properties"):
(ii) The second category comprised 14 properties, in respect of which the pursuer
granted a "global licence to occupy" in favour of Orchard & Shipman
(Glasgow) Limited ("O&S" and "the O&S Properties"); and
(iii) The third category comprised the remainder of the Properties, in respect of
which the pursuer granted individual leases for each property ("the Leased
Properties").
The Management Agreement
[3] The pursuer employed letting agents under management agreements. In particular,
by a management agreement dated 31 October 2014 ("the Management Agreement"), the
pursuer appointed a partnership known as Citywide Estates & Letting (“the Partnership”) to
be its managing agent. Giovanni Guidi and Dario Guidi were the only partners of the
Partnership. Although there was no express novation of the Management Agreement in
favour of the defender, the pursuer now accepts that the Management Agreement was so
novated by an agreement (albeit called an assignation) dated 2 November 2015, between the
Partnership and the defender.
3
[4] Clause 11 of the Management Agreement provided for 12 months' notice of its
termination, to be given not less than 30 days prior to the anniversary of that agreement.
[5] The pursuer was not a party to that novation or assignation (the form of the transfer
matters not for present purposes (“the assignation”)) and it never expressly consented to it.
The receivers received a copy of the transfer agreement only on 18 August 2016, after the
Summons in this action had been served, on 23 June 2016.
The Issue
[6] Joint receivers were appointed to the pursuer on 21 December 2015 (“the Receivers”).
They terminated or revoked the Management Agreement by letter dated 14 January 2016
(“the Revocation”). For a significant period of time, the defender disputed whether the
pursuer had effectually terminated the Management Agreement. By the time of the proof in
this action, it was accepted that the pursuer had revoked the Management Agreement.
However, the defender’s position is that, subsequent to the Revocation, the pursuer has
either waived or revoked (the defender’s position is not clear) the Revocation, or that the
pursuer has novated the Management Agreement. This impasse persisted, and the pursuer
raised the present action seeking declarator:
(i) that the Management Agreement had been terminated and that the defender
had no continuing authority under it, and
(ii) in the alternative to (i), that the Management Agreement was unenforceable
as against the pursuer by reason of the appointment of receivers.
As there was reference in submissions to the fact that the pursuer had concluded for, but not
sought, interim interdict, I should record that in the Summons the pursuer concluded for
interdict, and interdict ad interim, against the defender from continuing to hold itself out as
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