James Percy V. Govan Initiative Limited
| Jurisdiction | Scotland |
| Judge | Lord Matthews |
| Neutral Citation | [2011] CSOH 177 |
| Court | Court of Session |
| Published date | 21 October 2011 |
| Year | 2011 |
| Date | 21 October 2011 |
| Docket Number | A789/06 |
| OUTER HOUSE, COURT OF SESSION [2011] CSOH 177 | |
| A789/06 | OPINION OF LORD MATTHEWS in the cause JAMES PERCY Pursuer; against GOVAN INITIATIVE LIMITED Defender: ________________ |
Pursuer: Party
Defender: McKenzie; Simpson & Marwick, Solicitors
21 October 2011
Introduction
[1] In this case the pursuer seeks payment by the defenders of the sum of £250,000 sterling, with interest, as a result of what he claims are certain breaches of duty on the part of their employees. Very broadly speaking the pursuer claims that in and around 2001 he decided to commence a stone masonry business, having identified a market for such a business in Scotland. To assist him in achieving this he sought the help of the defenders who provide advice to individuals and organisations in relation to proposed business ventures. It is averred that a Mr George Smith of the defenders gave him advice from August 2001 until December 2001 and then handed the pursuer over to a Mr Anthony Massot, another employee of the defenders. This was because of a conflict of interest, the details of which are of no significance. Mr Massot, it is said, confirmed in December 2001 that he would be happy to prepare a business plan while the pursuer gathered letters from potential clients. It is averred that in the first week of January 2002 the defender gave the pursuer "a signed contract of a duty of care during the period of his involvement". The defenders are said to have brought in an accountant from Campbell Dallas, Accountants on 13 and 21 February 2002. It is averred that they knew the granite business and confirmed the pursuer's profit margin and that "the pursuer held over 35 signed letters of contract." The defender is said to have told the pursuer to deal with a company in England called Lister Madusa as that would help to keep British jobs and that "we would get every piece of help needed". Condescendence II continues as follows:
"The pursuer told the defender that would not work and the pursuer proved right, the contracts (sic) is worth over one million pounds. The pursuer had further meetings with Mr Massot on 13th and 21st February, 1st, 7th of March and was told to go and open the doors for business as loans will be with us 4 to 6 weeks, also on the 28th of March, 3rd April, 9th May, 12th and 21st June, 9th and 26th July, 5th, 12th and 13th September, 29th October, 27th November. Also the pursuer had meetings with the Scottish Executive Enterprise Investigation Team and a phone call to the pursuer's house by Mr Jack Perry say that he heard a different story from the truth that the pursuer gave him on the phone. Mr Perry arranged a meeting with Mr Charles Wood and his board members, including Sir John Ward. In the course of the earlier meetings Mr Massot undertook to provide the pursuer with assistance in respect of incorporating a company, the preparation of a suitable business plan and applications to funding agencies that provided assistance to start up businesses. Mr Massot also assisted in finding bankers, the Bank of Scotland, to act in respect of the business when incorporated. The pursuer was assisted in finding premises for the business by Mr Massot. These premises were situated at the Evans Business Centre, Units 13/14, 68-74 Queen Elizabeth Avenue, Hillington Industrial Estate, Glasgow, G52 4NQ. In or around November 2002 the pursuer required to relocate the business to premises at 38 Kelvin Avenue, Hillington, G52 4LT. When Mr Massot was advised by the pursuer he would be relocating the business, Mr Massot indicated that this would not present a difficulty".
[2] In answer, it is admitted that the pursuer had certain meetings with Mr Massot who worked for the defenders and that he provided certain assistance. The remainder of his averments are said to be not known and not admitted or are denied. Certain averments are made about what happened at a meeting between Mr Massot, the pursuer and Campbell Dallas and there are further averments about a meeting between a Jim O'Connor, Gateway Business Manager, Glasgow, his colleague Linda Gillespie and the pursuer in order to investigate the pursuer's concerns about his applications for funding to Glasgow City Council and Developing Strathclyde Limited. It is averred that Mr O'Connor reported his findings to the pursuer by letters dated 23 October 2003 and 18 March 2004 and that he concluded that while he regretted that the services provided to the pursuer had not been as productive as the pursuer would have wished, he was satisfied that this was not as a result of any fault or omissions on the part of Mr Massot. The pursuer is also called upon to produce a copy of the "contract of a duty of care" to which he refers.
[3] In Condescendence III the pursuer avers that on or about 22 May 2002 Mr Massot submitted an application to Glasgow City Council in respect of financial assistance in the sum of £10,000 from the West of Scotland Loan Fund. The application was processed until it transpired that the premises in respect of which the application was made fell outwith the boundary of Glasgow City Council. It goes on as follows:
"On or about 30th December 2002, Mr Massot visited the pursuer at the premises of his business with Cameron Ritchie of Scottish Enterprise, Renfrewshire, as the defender and in particular Mr Massot could no longer act on his behalf as the premises fell outwith the defender's catchment area. In fact neither of the premises from which the pursuer operated his business fell within the defenders catchment area despite the assurances of Mr Massot that he was the appropriate person to act on the pursuer's behalf. Reference is made to a report compiled by Mr Massot on 15 March, 2003, a copy of which is produced herewith and incorporated herein brevitatis causa. Further explained that by letter dated 21st February, 2005 the Chief Executive of Scottish Enterprise, Jack Perry wrote to the pursuer confirming that both premises occupied by the pursuer's businesses were outwith the defenders catchment area. The letter inter alia also acknowledged that the advice offered to the pursuer 'did not match the high standards we aim for'. A copy of the letter is produced herewith and referred to for its terms, which together with the enclosure referred to therein are incorporated herein brevitatis causa. In consequence of the advice offered by Mr Massot the pursuer has suffered loss and damage hereinafter condescended upon."
[4] In answer the defenders refer to Mr Massot's report and the letter from the Chief Executive for their terms. Quoad ultra the averments are said to be not known and not admitted.
[5] Condescendence IV reads as follows:
"The loss and damage suffered by the pursuer was caused by the fault of Anthony Massot for whose actings in the course of his employment with them the defender is responsible. Mr Massot in advising the pursuer owed him a duty of care. In particular, Mr Massot was under a duty to prevent the pursuer whether by act or omission from suffering loss. In acting on behalf of the pursuer as his business advisor in circumstances where he should not have done so and in failing to check whether he was so entitled to act prior to doing so he was in breach of that duty in consequence of which the pursuer has suffered loss."
This is met with a simple denial.
[6] Condescendence V runs as follows:
"As a result of Mr Massot's breach of duty the pursuer has suffered loss. In particular in consequence of the pursuer failing to secure loans he was unable to ensure his business could properly service an overdraft obtained from the Bank of Scotland. The pursuer granted personal guarantees in respect of the businesses' debts for which he is liable. Furthermore as a result of the mishandling of the business start up process the pursuer lost the opportunity to derive an income from the business. In the circumstances the sum sued for is a reasonable estimate of the pursuer's loss and damage."
This averment is met with a simple denial.
[7] The Closed Record was allowed to be received late on 11 July 2007 and the action was sisted to enable the pursuer's application for sanction to instruct an accountant to be determined by the Scottish Legal Aid Board. The sist was recalled on 12 May 2009 because the pursuer's solicitors were no longer acting for him. After sundry procedure the case was, on 16 December 2009, appointed to the Procedure Roll on the first and second pleas-in-law for the defenders. These are in the following terms:
"1 The pursuer's averments being irrelevant et separatim lacking in specification, the action should be dismissed.
2. The pursuer's averments in relation to quantum being irrelevant et separatim lacking in specification, they should not be admitted to probation and the action dismissed."
[8] On 17 March 2010 the diet of Procedure Roll was discharged and the case put out By Order to enable the pursuer to take steps to secure legal representation. A further diet of Procedure Roll was discharged on 14 July 2010 and the pursuer was ordained to lodge a Minute of Amendment within eight weeks, with answers to be lodged within four weeks thereafter. The Minute of Amendment was allowed to be received late on 9 November 2010 and on 17 November 2010 the answers were allowed to be received at the bar of the court and four weeks for adjustment was allowed. The pursuer was ordained to lodge in process a legal aid certificate prior to the next calling of the case, which was on 17 December 2010. On that date the Closed Record was allowed to be opened up and was amended in terms of the Minute of Amendment and answers, both as adjusted, and the Record was closed of new. Lord Brailsford ordained the defenders to prepare the amended Closed Record and the pursuer was ordained to lodge a Certificate of Endorsement by 14 January 2010. The cause was once again appointed to the Procedure Roll for debate on the defenders' pleas-in-law and in due course it...
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