Pert v McCaffrey
| Jurisdiction | Scotland |
| Judgment Date | 29 January 2020 |
| Neutral Citation | [2020] CSIH 5 |
| Docket Number | No 15 |
| Date | 29 January 2020 |
| Court | Court of Session (Inner House) |
[2020] CSIH 5
First Division
Sheriff Court
Cantiere San Rocco SA v Clyde Shipbuilding and Engineering Co Ltd 1923 SC (HL) 105; 1923 SLT 624; [1924] AC 226; (1923) 16 Ll L Rep 327
Compagnie Commerciale Andre SA v Artibell Shipping Co Ltd (No 2) 2001 SC 653; 2001 GWD 8–307
Courtney's Exrs v Campbell [2016] CSOH 136; 2017 SCLR 387; 2016 GWD 31–564
Dollar Land (Cumbernauld) Ltd v CIN Properties Ltd 1998 SC (HL) 90; 1998 SLT 992; 1998 SCLR 929; [1998] 3 EGLR 79; [1998] 51 EG 83; The Times, 24 August 1998
Glasgow District Council (City of) v Morrison, McChlery & Co 1985 SC 52; 1985 SLT 44
Lawrence Building Co Ltd v Lanarkshire County Council 1978 SC 30; 1979 SLT 2
Morgan Guaranty Trust Co of New York v Lothian Regional Council 1995 SC 151; 1995 SLT 299; 1995 SCLR 225
Property Selection and Investment Trust Ltd v United Friendly Insurance plc 1999 SLT 975; 1998 SCLR 792
Shilliday v Smith 1998 SC 725; 1998 SLT 976; 1998 SCLR 502
Simpson v Downie [2012] CSIH 74; 2013 SLT 178; 2013 SCLR 377; 2012 Fam LR 121
Thomson v Mooney [2013] CSIH 115; 2014 Fam LR 15; 2014 GWD 14–263
Transco plc v Glasgow City Council 2005 SLT 958; 2005 SCLR 733
Varney (Scotland) Ltd v Lanark Town Council 1974 SC 245; 1976 SLT 46
Bell, W, Dictionary and Digest of the Law of Scotland (7th ed, Bell and Bradfute, Edinburgh, 1890), p 330
Bennion, FAR, Statutory Interpretation: A code (7th Bailey and Norbury ed, LexisNexis, London, 2017), para 25.6
Evans-Jones, R, Unjustified Enrichment (W Green, Edinburgh, 2003), vol I, paras 1.97–1.101, 2.20–2.39
Gloag, WM, and Henderson, RC, The Law of Scotland (10th Wilson and Forte ed, W Green, Edinburgh, 1995), para 29.13
Gloag, WM, and Henderson, RC, The Law of Scotland (11th Dunlop ed, W Green, Edinburgh, 2001), para 28.13
Gloag, WM, and Henderson, RC, The Law of Scotland (14th Eassie and MacQueen ed, W Green, Edinburgh, 2017), paras 24.01, 24.02, 24.07, 24.16–24.19
Johnston, D, Prescription and Limitation of Action (2nd ed, W Green, Edinburgh, 2012), para 4.91
Kames (Lord) (Homes, H), Principles of Equity (4th ed, Bell and Bradfute, Edinburgh, 1800), pp 24, 104
MacQueen, HL, “Cohabitants, Unjustified Enrichment and Law Reform (Part 1)” 2019 (7) Fam LB 1
Sellar, WDH, “Unjust Enrichment” in Stair Memorial Encyclopaedia: The Laws of Scotland (Butterworths/Law Society of Scotland, Edinburgh, 1995), vol 15, para 71
Stair, JD, The Institutions of the Law of Scotland: Deduced from its originals, and collated with the civil, canon, and feudal laws, and with the customs of neighbouring nations (2nd ed, A Anderson, Edinburgh, 1693), I, vii, 7
Whitty, NR, “Transco plc v Glasgow City Council: Developing enrichment law after Shilliday” (2006) 10 Edin LR 113
Unjustified enrichment — Recompense — Cohabitants — House purchased in parties' joint names in anticipation of relationship continuing — Purchase funded by proceeds of sale of pursuer's flat — Parties' relationship ended — Pursuer subsequently sequestrated — One-half share of proceeds of sale of house paid by pursuer's trustee to defender — Whether pursuer entitled to recovery on basis of undertaking by defender not to claim any value on breakdown of relationship
Cohabitants — Financial provision on cessation of cohabitation — Whether failure to exercise statutory right to financial provision a bar to common law claim for recompense — Family Law (Scotland) Act 2006 (asp 2), sec 28
Prescription — Quinquennial prescription — Appropriate date — Recompense — Cohabitants — Whether claim arises on breakdown of relationship or subsequent breach of undertaking — Prescription and Limitation (Scotland) Act 1973 (cap 52), sec 6
Christine Pert brought an action for recompense based upon a plea of unjustified enrichment in the sheriffdom of North Strathclyde at Paisley against the defender. The sheriff sustained the defender's plea to the relevancy and dismissed the pursuer's action. The pursuer appealed. The cause was remitted by the Sheriff Appeal Court to the Court of Session.
The Family Law (Scotland) Act 2006 (asp 2) (‘the 2006 Act’), sec 28, provides that, where cohabitants cease to cohabit otherwise than by reason of death, “(2) On the application of a cohabitant (the ‘applicant’), the appropriate court may, after having regard to the matters mentioned in subsection (3)– (a) make an order requiring the other cohabitant (the ‘defender’) to pay a capital sum of an amount specified in the order to the applicant … (3) Those matters are– (a) whether (and, if so, to what extent) the defender has derived economic advantage from contributions made by the applicant; and (b) whether (and, if so, to what extent) the applicant has suffered economic disadvantage in the interests of– (i) the defender … (4) In considering whether to make an order under subsection (2)(a), the appropriate court shall have regard to the matters mentioned in subsections (5) and (6). (5) The first matter is the extent to which any economic advantage derived by the defender from contributions made by the applicant is offset by any economic disadvantage suffered by the defender in the interests of– (a) the applicant … (6) The second matter is the extent to which any economic disadvantage suffered by the applicant in the interests of– (a) the defender … is offset by any economic advantage the applicant has derived from contributions made by the defender.”
The parties began a relationship of cohabitation in 2004, and lived together in a flat owned by the pursuer in Glasgow. In 2008, the parties bought a house in Renfrew in which they continued to live as cohabitants. The purchase was funded entirely from the proceeds of sale of the pursuer's flat. Title to the property was taken in joint names on the basis that the parties' relationship was anticipated to continue. In the event that the relationship ended, the defender undertook that he would not claim any value from the property in view of the source of funds that facilitated the purchase of the property. In April 2012, the parties' relationship ended and the defender left the property. The pursuer was subsequently sequestrated. In January 2017, the pursuer's trustee in bankruptcy sold the property and paid one-half of the net sale proceeds to the defender. The pursuer contended that the defender's receipt of that sum was contrary to the undertaking given by him, and she sued on the basis of unjustified enrichment in June 2017.
The pursuer submitted that her ability to seek recovery of the sum arose in January 2017, when the defender received the sum from the pursuer's trustee and failed to act in accordance with his undertaking. The pursuer had no reason to believe that the defender would not honour his undertaking at any earlier stage. Accordingly, the claim had not prescribed. For the same reason, the pursuer had not made a claim for financial provision in terms of sec 28 of the 2006 Act when the cohabitation had ended. Section 28 did not provide for any limitation of former cohabitants' common law rights. Accordingly, any failure by the pursuer to exhaust alternative legal remedies did not bar a common law claim for recompense but was a factor to be balanced in assessing the equities of compelling redress.
The defender submitted that an action for unjustified enrichment could not be enforced if the pursuer had elected not to exercise her statutory rights. The pursuer had failed to aver any strong and special circumstances that would justify a departure from the alternative remedy principle. In any event, the pursuer's claim for recompense had prescribed.
Held that: (1) the rationale for the general principle, whereby a person was normally bound to adopt the ordinary legal remedies open to him before resorting to equitable remedies, was that the availability of the former meant that there ought to be no need to resort to the latter, and so a party could not ignore the existence of a legal remedy and seek recompense on the basis of some general equitable consideration (para 18); (2) sec 28 of the 2006 Act was not an alternative or equivalent remedy to an action for recompense, but one which was additional to any common law remedy otherwise available, and the failure to exercise the right to make an application under sec 28 timeously did not bar the use of such remedies (paras 24, 33); (3) on the basis of the pursuer's averments, the parties had agreed that, in the event of the breakdown of the relationship, the defender would convey his share of the property to the pursuer; accordingly, the existence of common law remedies, such as specific implement of the agreement or damages as a consequence of its breach, was fatal to the pursuer's claim on the basis of the alternative remedy principle (paras 25, 32); (4) the prescriptive period began to run in April 2012 when the defender left the relationship along with a one-half share in the property, which he was then contractually bound (on the pursuer's averments) to convey to the pursuer or at least to account for its value; the action not having been served until June 2017, any claim had prescribed (paras 26, 31); and appeal refused.
Observed (per Lord Brodie) that, generally speaking, claims for reversal of unjustified enrichment could be said to be common law remedies subject to an equitable defence, which might be to the effect that an alternative remedy was available but not resorted to, but this was different from saying that no claim for reversal of unjustified enrichment could ever be made if there was an alternative way of proceeding; and opinion reserved as to whether there was a generally applicable principle of subsidiarity (paras 39–41).
Transco plc v Glasgow City Council 2005 SLT 958 approved, Courtney's Exrs v Campbell2017 SCLR 387disapproved, Shilliday v Smith1998 SC 725, Morgan Guaranty Trust Co of New York v Lothian Regional Council1995 SC 151 and Dollar Land (Cumbernauld) Ltd v CIN Properties Ltd...
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