Lindsay Plant Limited V. Norwest Holst Group Plc
| Jurisdiction | Scotland |
| Judge | Lord Hamilton |
| Date | 17 November 1999 |
| Docket Number | CA/19 |
| Court | Court of Session |
| Published date | 18 November 1999 |
| OUTER HOUSE, COURT OF SESSION
| |
| CA/19/14/99
| OPINION OF LORD HAMILTON in the cause LINDSAY PLANT LIMITED Pursuer; against NORWEST HOLST GROUP plc Defenders: ________________
|
Pursuer: S. P. Wolffe; Simpson & Marwick, W.S.
Defenders: Clancy; Balfour & Manson
17 November 1999
Some time prior to the accident aftermentioned the pursuers ("Lindsay") hired to the defenders ("Norwest") a JCB vehicle. That vehicle was so supplied with an operator, Mr Winning. On or about 4 July 1993 a Mr Stirling, a labourer employed by Norwest at a building site in Castlemilk, Glasgow, was working on that site in the course of his employment. He was assisting Mr Winning who was there operating the JCB in furtherance of the hire arrangement made with Lindsay. Mr Stirling sustained injury in the course of that operation when his right lower leg and foot were pinned between part of the JCB and a pavement and kerb.
Mr Stirling raised proceedings in the Court of Session for damages. He convened as defenders Norwest, his employer, and Lomond Plant Limited ("Lomond"). Lomond, it appears, was the owner of the JCB and the employer of Mr Winning. According to Lindsay's averments in the present action the JCB (with Mr Winning as operator) had in or about April 1993 been hired by Lindsay from Lomond. The grounds of action pled by Mr Stirling against Norwest were negligence at common law and breach of statutory duty. The cases at common law were based on alleged breaches of duties to take reasonable care to provide a safe place of work, safe plant and equipment and a safe system of working. The statutory cases were based on alleged breaches of seven separate regulations, namely, regulations 26(3) and 49(1) of the Construction (Lifting Operations) Regulations 1961, regulation 6(2) of the Construction (Working Places) Regulations 1966 and regulations 5, 8, 9 and 10 of the Provision and Use of Work Equipment Regulations 1992. The grounds of action pled by Mr Stirling against Lomond were also negligence at common law and breach of statutory duty. The case at common law was based on the proposition that Mr Winning had negligently operated the JCB and that Lomond as his employer was vicariously liable for his acts and omissions. Mr Stirling also pled a case against Lomond on the basis of alleged breach of regulation 26(3) of the Construction (Lifting Operations) Regulations 1961.
Lomond convened Lindsay to Mr Stirling's action by third party notice on an allegation that, under the terms of the relative contract of hire, Lindsay was in a question between them liable for any damages, losses, charges or expenses arising out of or as a consequence of any accident involving any vehicle hired under that contract. They thus claimed indemnity from Lindsay. The relevancy of Lomond's averments directed against Lindsay was discussed at procedure roll before Lord Macfadyen. On 29 June 1996 his Lordship granted decree of dismissal in Lindsay's favour (Stirling v Norwest Holst Ltd 1997 S.L.T. 973).
The case directed against Norwest and Lomond then proceeded to proof before answer. At the diet of proof before Lord Eassie the defenders, after the evidence of the pursuer had been led, intimated to the court that liability was admitted by each of them and that an apportionment between them of their joint and several liability to Mr Stirling had been agreed extrajudicially (Stirling v Norwest Holst Ltd (No.2) 1998 S.L.T. 1359 at p.1360). The case proceeded on the issue of quantum only. Lord Eassie assessed the damages payable to Mr Stirling in the sum of £231,717 inclusive of interest and "in respect of the minute of liability number 49 of process" found Norwest and Lomond jointly and severally liable to Mr Stirling in that sum (p.1370). That minute was not before me at the debate in this action but the terms on which liability was dealt with in the earlier action are sufficiently clear from Lord Eassie's opinion. In this action it is averred that the extrajudicial agreement between Norwest and Lomond was to the effect that Lomond would, as between them, be liable for 15% of any damages and expenses awarded to Mr Stirling.
The discussion before Lord Macfadyen referred to above was directed to a claim for relief under clause IV(2) of the conditions of contract there discussed. It proceeded on the assumption that insurance, as provided for under clause III(1), was in force. It subsequently emerged that that assumption was mistaken. In those circumstances Lomond made an extrajudicial claim for relief against Lindsay under a different provision of those conditions, namely, clause III(2). That claim was for relief in respect of 15% of the damages (and judicial interest) and expenses which Lomond claimed to have paid in furtherance of the extrajudicial agreement on apportionment. Lomond also claimed relief against Lindsay in respect of its own expenses in Mr Stirling's action. In the present action Lindsay having, as it avers, made payment to Lomond of the sums claimed by it seeks indemnity from Norwest in respect of those payments.
The discussion before me included consideration of two sets of conditions of hire, namely (1) those said by Lindsay to have been incorporated in a contract between it and Lomond ("the Lomond conditions") and (2) those said by Lindsay to have been incorporated in a contract between it and Norwest ("the Lindsay conditions"). In this action Norwest does not admit that there was any contract of hire between Lindsay and Lomond (nor what terms were incorporated into any such contract). It admits that Lindsay hired to it the JCB together with Mr Winning but it does not (due to an inability to trace relative documentation) admit that the conditions averred by Linsday were incorporated into the contract with it. However, for the purposes of the debate on relevancy Lindsay's averments of these contractual arrangements must be taken pro veritate.
The Lomond conditions include the following:
"II USE
(1) The hirer agrees that any vehicle hired to him hereunder shall be used only for lawful purposes and by safe, careful licensed drivers employed and or controlled by him. The hirer shall, and shall require is drivers to, use such vehicle with reasonable care and diligence ... .
...
(5) The hirer shall keep the vehicle in his possession and immediately notify the owner in writing if for any reason he loses control or possession of the vehicle ... .
...
III INSURANCE AND INDEMNITY
(1) The hirer agrees at his sole expense to arrange and maintain during the term of this contract full comprehensive insurance in accordance with the use and operation of each vehicle hired hereunder. Such insurance will include an unlimited liability for third party bodily injury and third party property damage, including coverage for loss of or damage to each hired vehicle resulting from fire, theft, conversion, collision or upset ...
(2) In the event of any repudiation of liability by the insurer of the insurance to be provided under this clause, on any ground or for any reason whatsoever (except a breach or default for which the owner is solely responsible), the hirer hereby agrees to defend, indemnify and hold the owner free from and against any and all loss, liability and expense including reasonable legal fees, caused by or arising from or claimed to have been caused by or to have arisen from the use or operation (including loading and unloading) of one or more vehicles hired hereunder which results, or is claimed to result, in loss or damage sustained by any person or persons including but not limited to the agents and employees of the hirer and owner. The hirer further agrees in any event to indemnify and hold the owner free from and against all loss, liability and expense, including reasonable fees, caused or arising or claimed to have been caused or to have arisen as aforesaid to the extent that the same is not covered by said insurance to be provided under this clause III or to the extent said insurance to be provided under this clause III is not then in effect".
The Lindsay conditions include the following:
"6 Indemnity to Owner. Where an operator is provided with the plant, he shall work under the supervision and instruction of the Hirer or his representative and the Hirer shall not permit any person other than the operator to operate the plant without the Owner's prior consent in writing. The operator shall be deemed for the duration of the hire to have become a servant of the Hirer who shall be responsible for his actions as if he were in the Hirer's direct employ to the effect that the Hirer shall free and relieve the Owner of and from the consequences of all claims of whatever nature which may be made against the Owner by third parties arising from the actions of the operator, including claims arising from the operator's negligence or breach of statutory duty.
7 Sub-Letting. The Hirer shall not sub-let the plant or any part of it without the Owner's prior consent in writing".
Condition 1 of those conditions defines "Owner" as meaning "the person, firm or company letting out the plant on hire" and "Hirer" as meaning "the person, firm or company or other party taking the plant on hire".
On behalf of Norwest Mr Clancy's primary motion was that the action be dismissed on the grounds, first, that there were no relevant averments to instruct the proposition that Lindsay had had any liability to Lomond and, second and in any event, that there were no relevant averments that Norwest was obliged to indemnify Lindsay in respect of any such liability. Although Mr Clancy's submissions addressed the second issue first, it is convenient to narrate the arguments in the alternative order.
Mr Clancy submitted that the Lomond conditions had no application to circumstances, such as those which had occurred, where Lindsay had sub-let the JCB...
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