Friends Provident Life And Pensions Limited V. John Mcguinness
| Jurisdiction | Scotland |
| Judge | Lord Mackay of Drumadoon |
| Neutral Citation | [2005] CSOH 72 |
| Court | Court of Session |
| Docket Number | A829/04 |
| Published date | 03 June 2005 |
| Date | 03 June 2005 |
| Year | 2005 |
| OUTER HOUSE, COURT OF SESSION [2005] CSOH 72 | |
| A829/04
| OPINION OF LORD MACKAY OF DRUMADOON in the cause FRIENDS PROVIDENT LIFE & PENSIONS LIMITED Pursuers; against JOHN McGUINNESS Defender: ________________ |
Pursuers: Moore, Solicitor Advocate, Q.C. ; H B M Sayers
Defender: Thomson, Summers ; Blacklock Thorley
3 June 2005
Introduction
[1]This is an action in which the pursuers conclude for payment of £627,408.31 by the defender. In terms of Conclusion 1 of the summons, the pursuers seek repayment of that sum of money, which they aver that they paid in error to the defender on 26 November 2004.
[2]The background to the pursuer's claim is as follows. On 25 November 1998, the defender effected a single premium with profit bond with the pursuers ("the policy"). When the policy was effected, the defender made a starting investment of £750,000. On 15 November 1999 the defender assigned the policy to the Royal Bank of Scotland ("the Bank"), in security of certain obligations owed to the Bank by the firm of W. Haughey, D.W. Keane and J. McGuinness, in which the defender was and remains a partner. In November 2004, the defender sought to surrender the policy to the pursuers. The pursuers agreed to do so and they paid him the sum of £627,408.31. It is averred on behalf of the pursuers that they did so in ignorance of the fact that the policy remained assigned to the Bank. No retrocession of the assignation has ever been granted. It is averred that the pursuers' error arose because their electronics records indicated that with effect from 16 June 2004 the assignation of the policy in favour of the Bank no longer existed. It is averred that those records noted erroneously that the reversionary interest in the policy had reverted to the defender. Indeed, during the hearing before me, it was made clear on behalf of the pursuers that in October 2004 they had advised solicitors acting for the defender that their records showed the policy to have been reassigned by the Bank in June 2004. The defender himself had been similarly informed, during various telephone conversations between the members of the pursuers' staff and him, in October and November 2004.
[3]The current action was raised in December 2004. On 10 December 2004 Lord Abernethy granted interim interdict against the defender from dissipating, dealing with, making over to a third party or in any way intermitting with the funds in the sum of £627,408.31 that had been paid to him in error on 26 November 2004.
[4]An Open Record was lodged on 25 February 2005. In his written defences, which form part of the Open Record, the defender admitted making an application to surrender the policy and to having received payment of £627,408.31. The defences did not admit, however, that the Bank has never retrocessed the policy to the defender.
[5]On 14 February 2004 the pursuers' solicitors wrote to the defender's solicitors, intimating their intention to enrol a motion for summary decree in this action on 15 March 2005. The pursuers had previously lodged various documents relating to the policy, including the assignation of the policy in favour of the Bank, which was granted by the defender on 15 November 1999. The original inventory also included a fax message dated 8 December 2004, which the Bank had sent to the pursuers, asking the latter to confirm that the policy remained in place and that their records confirmed the existence of the assignation in favour of the Bank. With the letter of 14 February 2005, the pursuers' solicitors enclosed a copy of a letter dated 4 February 2005, which the pursuers had received from the Bank. That letter of 4 February 2004 stated in terms that the policy had not been re-assigned by the Bank to the defender. The letter of 14 February 2005 suggested to the defender's solicitors that it was incumbent on the defender to produce documentary evidence that the policy had been re-assigned or, in the absence of such documentary evidence, clear information as to the circumstances in which the re-assignation took place, along with details of the persons that the defender had dealt with.
Motion for summary decree
[6]At the hearing of the motion for summary decree on 17 March 2005, the pursuers were represented by Mr Moore, Solicitor Advocate, Q.C., and the defender by Mr Howie, Q.C., and Mr Summers, Advocate.
[7]In moving me to grant summary decree for payment, in terms of the first conclusion of the summons, Mr Moore referred to the various productions which the pursuers had previously lodged. He also referred to an affidavit by Derek Charles Edwards, an employee of the pursuers, and one by Lynn Mhairi Hunter, a manager with the Royal Bank of Scotland, which had been lodged in process. Those affidavits expanded upon the information contained in the summons and the productions that had previously been lodged. Attached to the affidavit of Derek Charles Edwards were transcripts of the various telephone conversations between the defender and members of the pursuers' staff, which had taken place during October and November 2004.
[8]Mr Moore argued that no relevant defence had been pled to the conclusion for payment. He submitted that it was not a defence to the action for the defenders merely to say that the payment had been made as a consequence of error on the part of the pursuers. The pursuer had themselves averred that the payment had been made in error. They accepted that prior to the defender seeking to surrender the policy on 5 November 2004, they had stated to the defender and to his solicitors that the policy had been re-assigned in favour of the defender. The Bank had stated, however, that had not occurred. The raising of the action and the letter of 14 February 2005 to the defender's solicitors had afforded the defender ample opportunity to produce evidence that the Bank were in error in stating that the policy had never been re-assigned by them. The defender had failed to do so. His defences contained no averments to that effect. In these circumstances, summary decree should be granted.
[9]In replying to these submissions, Mr Howie moved me to continue the motion. He stated that he wished to take instructions on the issues that had been raised. He informed me that the defender's position was that the pursuers had told him the policy had been retrocessed. The defender assumed that he must have lost the policy document, after it had been returned to him by the Bank. Mr Howie explained that he had no instructions as to when any retrocession had been granted, nor as to whether, and if so when, a retrocession had come into the possession of the defender. He explained that the defender was involved with Mr Keane and Mr Haughey. The defender had understood that Mr Keane had been making efforts to seek the release of various securities granted to the Bank. The defender had relied on what he and his...
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