Therese Margaret Mcauley Or Chalmers Against Chris John Williams Chalmers
| Jurisdiction | Scotland |
| Judge | Lady Smith,Lady Paton,Lord Drummond Young |
| Judgment Date | 27 October 2015 |
| Neutral Citation | [2015] CSIH 75 |
| Court | Court of Session |
| Docket Number | A523/12 |
| Published date | 27 October 2015 |
| Date | 27 October 2015 |
EXTRA DIVISION, INNER HOUSE, COURT OF SESSION
[2015] CSIH 75
A523/12
Lady Paton
Lady Smith
Lord Drummond Young
OPINION OF THE COURT
delivered by LADY PATON
in the cause
THERESE MARGARET MCAULEY or CHALMERS
Pursuer and reclaimer;
against
CHRIS JOHN WILLIAMS CHALMERS
Defender and respondent:
Pursuer and reclaimer: Tariq; Harper MacLeod LLP
Defender and respondent: Logan; TC Young
27 October 2015
A forged signature
[1] In this reclaiming motion, the pursuer and reclaimer challenges the Lord Ordinary’s refusal to grant decree of reduction of a forged disposition. The references below are to paragraphs of the Lord Ordinary’s opinion dated 7 November 2014.
[2] In the course of divorce proceedings which began on 24 February 2012 (paragraph 26), the pursuer’s lawyer Miss Jones carried out a search of the Land Register (paragraphs 19, 28). She discovered that the pursuer’s husband, Paul Chalmers, had purchased a flat at 38 Hotspur Street, Glasgow in 1998 (paragraphs 12, 19, 28). He had taken the title in the pursuer’s name, without her knowledge or consent, by a disposition signed by the seller John Alston McKelvey and dated 26 October 1998 (paragraphs 12, 13). In 2006, by a disposition dated 16 March 2006, the property was further disponed “for love, favour and affection” to the Chalmers’ son Chris, the defender in this action (paragraphs 1, 2). As part of the transaction, the defender had signed Stamp Duty Land Tax forms relating to the property. The defender had also permitted Mr Chalmers (or Mr Chalmers trading as Rentier Properties, a property business) to continue receiving the rental income from the flat after the title had been transferred into the defender’s name (paragraphs 9, 35-37, 80, 84).
[3] The pursuer had been unaware of these events until they were drawn to her attention by Miss Jones during the divorce proceedings (paragraphs 28-30, 44). As the pursuer averred in condescendence 3 of her divorce pleadings, she considered that she was having difficulty obtaining information from Mr Chalmers, particularly in relation to his capital and income. Mr Chalmers, who was working in Dubai, denied that there was any such difficulty.
[4] When the title deeds for Hotspur Street were examined, it was found that the pursuer’s signature had been forged on the 2006 disposition (paragraphs 1, 7, 11, 28, 43), and that Paul Chalmers had acted as the witness to the signature. The pursuer added some averments about her discovery of Hotspur Street in her divorce pleadings as follows:
“COND. 3 … The pursuer has discovered that a property at 38 Hotspur Street was formerly registered in her sole name. In or about 2006 the defender made arrangements for that property to be transferred to the sole name of the parties’ son Christopher Chalmers. The pursuer has no knowledge of signing a disposition to that effect. She does not know who may have signed such a document on her behalf. Title to said property was registered in the name of Christopher Chalmers in early 2008.”
Those averments were contained in the closed record date‑stamped 8 November 2012 in the divorce proceedings (appendix document 4). Thus clear notice was given to Mr Chalmers by 8 November 2012 that the pursuer had discovered that Hotspur Street had been put in her name, yet had subsequently been transferred to her son the defender without her knowledge or signature. The pursuer’s averments are referred to and summarised by the Lord Ordinary in paragraph 49 of his opinion.
[5] The pursuer’s husband Mr Chalmers did not respond to these averments with any information, explanation, or disclosure.
[6] A divorce minute of agreement was then signed by the pursuer and her husband. In that minute, dated 12 November 2012, the partnership between the pursuer and her husband (Rentier Properties) was dissolved. Mr Chalmers was to continue running the business (paragraph 3). In paragraph 52 of the Lord Ordinary’s opinion, it is noted that the minute –
“… provided for [the pursuer’s] resignation from the partnership and an election for the continuation of the partnership business. Save as otherwise provided for, [the pursuer’s] rights and interests in the partnership assets, capital accounts, and partnership income were transferred to Paul Chalmers. Both parties renounced any right they may have against each other …”
[7] A few days after the signing of the minute of agreement, the pursuer raised the present action of reduction and interdict against her son, the defender, who was employed as a property manager at D J Alexander (paragraph 9 of the Lord Ordinary’s opinion). In that action she narrated the ongoing divorce action between herself and her husband Paul Chalmers; the discovery of Hotspur Street and such facts as she had been able to ascertain in relation to the title; the fact that she and her son were “estranged”; and her concern that her son might sell or otherwise alienate Hotspur Street before matters were resolved.
[8] On 22 November 2012, Lord Jones granted interim interdict against the defender or anyone on his behalf from selling or otherwise alienating 38 Hotspur Street.
[9] In his defences to the present action of reduction and interdict, the defender averred that he believed that his father Paul Chalmers had purchased the subjects. His father’s reason for putting the title in the pursuer’s name was not known. His parents had operated a property partnership called Rentier Properties. That partnership held some properties in joint names, some in Paul Chalmers’ name, and Hotspur Street in the pursuer’s name. All of those properties were held in trust for the partnership. The minute of agreement dated 12 November 2012 had settled all issues relative to their divorce. The pursuer ought to have been aware that she had never been the owner of Hotspur Street but had held it in trust for the partnership. She had renounced any claim that she had as a partner or former partner by the minute of agreement and accordingly had no right to a remedy of reduction. In Answer 7 of the present action of reduction, the defender further averred:
“… the minute of agreement was signed on 12 November 2012. The present proceedings were raised and served upon the defender within days of that agreement being signed. Had Paul Chalmers been aware that the pursuer was seeking to recover the subjects and thereby an additional £130,000 or thereby of additional matrimonial property he would not have signed it. The pursuer gained an advantage thereby. In the event that reduction were granted and she was not obliged to account to Paul Chalmers for his interests in what would have been matrimonial property as well as his interests as the continuing principal of Rentier Properties she would have gained an unfair share of matrimonial property and have failed to give a true account as a former partner of said firm. In the said circumstances even if she is not the signatory of the disposition of the subjects (which is not known and not admitted) decree should be refused.”
[10] Decree of divorce, giving effect to the minute of agreement dated 12 November 2012, was pronounced in February 2013 (paragraph 2 of the Lord Ordinary’s opinion).
[11] In mid‑2014, a proof before answer in present action of reduction took place before Lord Boyd of Duncansby. Some two months prior to the proof diet, the defender moved into Hotspur Street and began living there as his home (paragraph 9 of the Lord Ordinary’s opinion).
[12] In his opinion dated 7 November 2014, the Lord Ordinary acknowledged that there was a basis for reducing the disposition, namely the forged signature. He rejected the defender’s contention that Hotspur Street had been owned by his parents’ partnership Rentier Properties and that the pursuer’s title had been in her capacity as partner. He accepted certain other submissions made on behalf of the defender (all as set out in his opinion) and refused to grant a decree of reduction and interdict. By interlocutor dated 7 November 2014, the Lord Ordinary dismissed the action, sustaining the defender’s second plea-in-law, which was in the following terms:
“2. In any event the pursuer having entered the minute of agreement with Paul Chalmers, she is personally barred from pursuing this action, and it should be dismissed.”
Further, by interlocutor dated 5 December 2014, the Lord Ordinary awarded expenses in favour of the defender.
The Lord Ordinary’s opinion
[13] The Lord Ordinary noted the defender’s submissions in paragraphs 65 to 68 of his opinion. Read short, counsel for the defender submitted first, that Hotspur Street belonged to the partnership Rentier Properties. The pursuer’s only interest in the property was therefore as a partner in the firm. However the pursuer had renounced any interest in the firm in the minute of agreement. Secondly, the court should not exercise its discretion by granting reduction of the title. The pursuer had made an informed decision when she signed the minute of agreement, knowing what she did about Hotspur Street (as reflected in her averments in the divorce action, set out in paragraph [4] above). Having signed that minute of agreement, she was personally barred from seeking reduction. In signing the minute of agreement she had not only renounced her claim against the assets of Rentier Properties, but she also sought to gain an unfair advantage by reaching a settlement and then by taking steps to recover an asset which she and her lawyer accepted would otherwise have been part of the matrimonial property and dealt with in the settlement. When the court was asked to exercise its discretion, each case turned on its own circumstances. The defender had obtained Hotspur Street in good faith and had spent money on it. He now lived in Hotspur Street as his home. He would lose the property if decree of reduction were granted.
[14] In a later section headed “Decision and reasons” (paragraphs 85 to 93) the Lord Ordinary noted:
“[85] I...
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