Perth & Kinross Council Against (first) Scottish Water And (second) Millglen (glasgow) Limited
| Jurisdiction | Scotland |
| Judge | Lord Malcolm,Lord Bracadale,Lord Drummond Young |
| Judgment Date | 08 November 2016 |
| Neutral Citation | [2016] CSIH 83 |
| Published date | 08 November 2016 |
| Date | 08 November 2016 |
| Court | Court of Session |
| Docket Number | A87/14 |
EXTRA DIVISION, INNER HOUSE, COURT OF SESSION
[2016] CSIH 83
A87/14
Lord Bracadale
Lord Drummond Young
Lord Malcolm
OPINION OF THE COURT
delivered by LORD DRUMMOND YOUNG
in the cause
by
PERTH & KINROSS COUNCIL
Pursuers and Respondents
against
(FIRST) SCOTTISH WATER and (SECOND) MILLGLEN (GLASGOW) LIMITED
Defenders and Reclaimers
Pursuers and Respondents: Smith, QC; Clyde & Co
First Defenders and Reclaimers: Clancy, QC; BLM
Second Defenders and Reclaimers: No appearance
8 November 2016
[1] The pursuers are the owners and operators of premises known as the Crieff Road Pre-School Centre in the western part of Perth. The first defenders are a body incorporated by statute which is responsible for water supply and sewerage throughout Scotland. The pursuers have raised proceedings in which they claim that the Pre-School Centre was damaged by flooding that occurred on 21 July 2010 when heavy rainfall backed up from a public sewer for which the first defenders were responsible. The second defenders are piling contractors who were responsible for carrying out works at a nearby housing development; the pursuers have an alternative claim, which is not relevant to this opinion, that those piling works were carried out negligently, with the consequence that the sewer was damaged and the flooding resulted.
Summons
[2] The pursuers’ summons was directed against “Scottish Water Limited” as first defenders. The conclusion was for £738,685.66. So far as directed against the first defenders, the averments were to the following effect. Within the grounds of the Crieff Road Pre‑School Centre there were two large diameter public sewers, which were described in some detail. In 2006, during the construction of the nearby housing development, damage occurred to one of the sewers, blocking it. As a result the other sewer, of 525 mm diameter, required to cope with an increased capacity. During 2008 on several occasions the drains serving the pursuers’ premises backed up. The pursuers identified the 525 mm sewer as being the cause of the problem and complained on more than one occasion to the first defenders. The first defenders advised the pursuers that they had carried out investigations but had not found any issues that could cause flooding. On the morning of 21 July 2010, however, following heavy rainfall, severe flooding occurred at the pursuers’ premises. The 525 mm sewer was unable to cope with the increased demand. Water and effluent backed up from manholes within the grounds of the Pre-School Centre and from sanitary appliances within the premises. The premises were flooded to a depth of approximately 1 metre.
[3] In relation to responsibility for the flooding, the pursuers aver that it was caused by the fault and negligence of the first defenders, who were under a duty to inspect, maintain and repair the sewers. Reference is made to section 2 of the Sewerage (Scotland) Act 1968. The pursuers aver that it was the duty of the first defenders, in response to the complaints made, to investigate the cause of the prior incidents of flooding, and further aver that if proper investigation had been carried out the damage to the other sewer would have been identified and repaired.
Identity of the defenders
[4] Following service of the summons and lodging of defences, the pursuers decided that they had made a mistake about the name and designation of the first defenders. The action as originally framed was directed against “Scottish Water Limited”, who were designed as “a company incorporated under the Companies Acts and having their registered office at Castle House, 6 Castle Drive, Carnegie Campus, Dunfermline, KY11 8GG”. The pursuers subsequently decided that the action should have been directed against Scottish Water rather than Scottish Water Limited. They accordingly moved to amend the instance to make this correction, identifying the first defenders as “Scottish Water” and designing them as “a body incorporated by statute and having a place of business at Castle House, Six Castle Drive, Carnegie Campus, Dunfermline, KY11 8GG”. The motion to amend came before the vacation judge, who decided to allow the amendment. The first defenders have reclaimed against his decision.
[5] Scottish Water Limited and Scottish Water are distinct corporate bodies, each having a legal personality of its own. Scottish Water is a body corporate established by section 20 of the Water Industry (Scotland) Act 2002. Schedule 3 to the 2002 Act provides for the requisite administrative structures, and other provisions of the Act impose a range of functions on the body corporate, notably water and sewerage functions. Section 25 of the 2002 Act confers power on Scottish Water to promote subsidiary companies, and Scottish Water Limited is a wholly-owned subsidiary of Scottish Water. Scottish Water Limited is a private company limited by shares under the Companies Act 1985. It has three ordinary shares of one pound each, all paid up and all owned by Scottish Water. Its registered office is situated at premises belonging to Scottish Water at Castle House, in Dunfermline; that is the address that is given for Scottish Water Limited in the original summons and for Scottish Water in the amended summons. It is a matter of agreement that, apart from its registered office, Scottish Water Limited has no offices, “establishment”, places of business, assets or staff. Furthermore, it does not carry on any business.
[6] Scottish Water, by contrast, fulfils a range of important statutory functions under the legislation governing water and sewerage in Scotland. Scottish Water’s net assets are valued at £5,000,000,000. Its workforce is numbered in thousands, and it has a very large number of installations and establishments with permanent staff. As the Lord Ordinary notes, these facts are a matter of public record. For present purposes it is important that Scottish Water is responsible in particular for the provision and maintenance of public sewers, such as the sewer in Perth whose condition is said to have given rise to the flooding and consequential damage of which the pursuers complain. Those responsibilities are imposed by statute, notably the Sewerage (Scotland) Act 1968 as applied and modified by the Water Industry (Scotland) Act 2002. Scottish Water Limited, by contrast, has no public responsibilities beyond those inherent in the running of a limited company. It has no statutory or other functions in relation to water or sewerage.
Progress of the Action
[7] The first defenders opposed the pursuers’ motion to amend the summons to substitute Scottish Water for Scottish Water Limited. They did not challenge the competency of amendment in itself, but they contended, in summary, that amendment should be refused on the ground that it involved the substitution of the right defender for the wrong defender after the expiry of the prescriptive period governing the pursuers’ claim. The damage to the pursuers’ property occurred on 21 July 2010. The summons was served on 8 July 2015 but the motion to amend was not made until more than five years had elapsed since the date of the damage; it was heard by the Lord Ordinary on 11 September 2015. On that basis the first defenders submitted that any claim against Scottish Water had prescribed before the motion to amend was made and, in accordance with the principles laid down in the leading case, Pompa’s Trustees v Edinburgh Magistrates, 1942 SC 119, the motion should be refused.
[8] The Lord Ordinary rejected that argument. He held that amendment of pleadings under Rule of Court 24 is a matter for the discretion of the court, and that discretion should be exercised in favour of permitting amendment. The proposed amendment did not involve any radical alteration of the pleadings, but merely corrected the pleadings to indicate the party which was in law responsible for the actings complained of. In pre-litigation correspondence the solicitors acting for both Scottish Water and Scottish Water Limited had responded to letters referring to “Scottish Water Limited” without correcting the name of the company. Furthermore, the difference between the two names could be attributed to clerical error, given the relatively wide scope that that concept has been given in recent cases. On that basis the decision of the Inner House in Link Housing Association Ltd v Gray Aitken Partnership Ltd (erroneously cited as Gray Aitken Partnership Ltd v Link Housing Association Ltd), 2007 SC 294, was distinguished.
Amendment
[9] Amendment of pleadings in the Court of Session is currently governed by Rule of Court 24. For present purposes, two provisions of the Rule of Court are relevant. First, RC 24.1(2)(b)(i) permits amendment “to correct or supplement the designation of a party to the cause”. Secondly, RC 24.1(2)(d) permits amendment “where it appears… that the cause has been directed against the wrong person”, in which case an amendment may insert an additional or substitute party and direct existing or additional conclusions, averments and pleas-in-law against that party.
[10] The power conferred by Rule of Court 24 is wide, and provided that no time limits intervene it permits the substitution of one defender for another. Where a time limit has expired, however, as through the law of prescription, a further principle becomes relevant. This is stated in the opinion of LP Cooper in Pompa’s Trustees v Edinburgh Magistrates, 1942 SC 119, at 125:
“[T]he Court will not in general allow a pursuer by amendment to substitute the right defender for the wrong defender, or to cure a radical incompetence in his action, or to change the basis of his case if he seeks to make such amendments only after the expiry of a time limit which would have prevented him at that stage from raising proceedings afresh”.
In Pompa’s Trustees, a claim for compensation for damage by rioting under the Riotous Assemblies (Scotland) Act 1822 was made against the...
To continue reading
Request your trial
-
Reclaiming Motion By Jill Clark (ap) Against Greater Glasgow Health Board
...48 BMLR 118 Perth and Kinross Council v Scottish Water Ltd [2015] CSOH 138; 2015 SLT 788 Perth and Kinross Council v Scottish Water Ltd [2016] CSIH 83; 2016 SLT 1251 Pompa's Trs v Magistrates of Edinburgh 1942 SC 119; 1942 SLT 118 Ralston v Secretary of State for Scotland 1991 SC 336; 1992 ......
-
X Against Y And Others
...of the Crown as defender has been clear throughout. The position is analogous to that in Perth & Kinross Council v Scottish Water & Anr 2017 SC 164. In any event, it would be equitable, in the particular circumstances of this case, to allow the pursuer’s case against the Advocate General to......
-
(first) Louise Docherty And Others Against (first) Secretary Of State For Business, Innovation And Skills And Another
...SC 301, Kleinwort Benson v GCC 2002 SLT 1190, McElroy v McAllister 1949 SC 110 and Perth & Kinross Council v Scottish Water & Another [2016] CSIH 83 and Johnson, Prescription and Limitation (2nd Edition para 22.22). Statutory Provisions and Rules of Court Scots Law [13] Rule 24.1 of the Rul......