Robert Graham And Mrs. Anne Graham V. E.a. Bell & Co And Others
| Jurisdiction | Scotland |
| Judge | Lord Hardie |
| Docket Number | O373/6 |
| Date | 24 March 2000 |
| Court | Court of Session |
| Published date | 24 March 2000 |
| OUTER HOUSE, COURT OF SESSION | |
| O373/6/1995
| OPINION OF LORD HARDIE in the cause ROBERT GRAHAM AND MRS ANNE GRAHAM Pursuers; against E A BELL & CO AND OTHERS Defenders: ________________ |
Pursuers: Agnew of Lochnaw, Q.C., Davidson; Drummond Miller, W.S.
Defenders: McNeill, Q.C., Paterson; Morison Bishop
24 March 2000
[1]In this action the pursuers allege that they have suffered loss as a result of the breach of contract and/or the professional negligence of the defenders. The alleged breach of contract and/or negligence is attributable to the administration on behalf of the pursuers by the defenders of the farms of Fruid and Carterhope, which were farmed by the first-named pursuer as an individual until he assumed the second-named pursuer as a partner in the firm of "Robert Graham". The firm was constituted by a Partnership Agreement signed on 24 February 1993 but deemed to have commenced with effect from 1 April 1992.
[2]The particular alleged breaches of contract and the specific allegations of negligence are identical in terms and are specified in Articles XI and XII of condescendence respectively. In summary, they relate to failures (i) to lodge or obtain proof of lodging a claim on behalf of the first-named pursuer for Sheep Annual Premium Subsidy (SAPS) in 1991; (ii) to make a claim in the name of the first-named pursuer for Sheep Annual Premium Quota from the National Reserve on or before 12 January 1994 in terms of the Sheep Annual Premium and Suckler Cow Premium Quotas (Amendment) Regulations 1993, Schedule 2, Part I, Category 2(a); (iii) to submit on behalf of the partnership a claim for SAPS in 1993 on or before 20 February 1993; (iv) to apply for Sheep Annual Premium Quota for the second-named pursuer under Category 3(b) of the Regulations and (v) to lease Sheep Annual Premium Quota for the partnership for 1994 or to advise the pursuers to do so.
[3]As a result of the failure to claim SAPS in 1991, the first-named pursuer avers in Article XIII of condescendence that he has suffered loss. This forms the basis of the first conclusion for payment to the first-named pursuer of £24,839.79 and of the first plea-in-law for the pursuers. As regards the other failures specified in Articles XI and XII of condescendence, the pursuers aver in Article XIV of condescendence that the partnership has suffered loss. This forms the basis of the second conclusion for payment to the partnership of £250,000 and of the second plea-in-law for the pursuers. In the third and fourth conclusions, as an alternative to the second conclusion, the first-named pursuer and the second-named pursuer respectively seek payment to each of them as individuals of the sum of £112,338. Averments in support of the alternative claims are contained in what senior counsel for the pursuers described at the Procedure Roll hearing as his "second esto case" in Article XIV of condescendence.
[4]The case was heard by me at Procedure Roll on 7 March and the three succeeding days upon the defenders' first four pleas-in-law. The first three pleas-in-law were directed to the third and fourth conclusions of the summons and the fourth plea-in-law was a general plea to the relevancy of the action, although, at Procedure Roll, counsel for the defenders confirmed that they were not seeking dismissal of the action but rather were using this plea to highlight the deficiencies in the pleadings in the case for the second-named pursuer as an individual and also to seek the exclusion from probation of certain averments, were I to sustain their submissions based upon the weaker alternative rule.
[5]Counsel for the defenders attacked the pleadings of the pursuers particularly in so far as they related to the third and fourth conclusions. In relation to both of these conclusions the principal attack was based upon the contention of the defenders that the claim by the pursuers as individuals had prescribed. The submission by counsel for the defenders in this respect may be summarised as follows:
(1)The second-named pursuer's claim as an individual derives from her being a partner in the firm and is dependent on the alleged negligence by the defenders in respect of the firm's affairs.
(2)In respect of the firm's loss all of the contractual and delictual duties flow from the failure by the defenders to make a timeous application for SAPS in 1993 on or before the closing date for such applications, namely 20 February 1993.
(3)The concurrence of injuria and damnum was 20 February 1993 and the quinquennium expired on 19 February 1998.
(4)The obligation to lease Sheep Annual Premium Quota did not extend the prescriptive period because the lease of quota would simply mitigate the loss arising from the failure to make timeous application. In any event, the time within which lease of Sheep Annual Premium Quota could be arranged expired on or about 15 September 1993.
(5)The pursuers aver that the defenders admitted at a meeting in or about November 1993 that the first-named pursuer had not been paid SAPS 1991, one consequence of which was that no automatic allocation of quota was made to the pursuers. By November 1993 the partnership had been formed and the first-named pursuer was a partner. Accordingly the firm was aware by November 1993 that it had suffered loss as a result of the failure to receive any payment in respect of SAPS 1991.
(6)In the foregoing circumstances, the alternative claim by the second-named pursuer prescribed on 19 February 1998 or at latest 30 November 1998. The alternative claim by the first and second-named pursuers was added by adjustment to a minute of amendment in February 1999.
(7)The pursuers could not rely upon section 11(2), section 11(3) or section 6(4) of the Prescription and Limitation (Scotland) Act 1973.
[6]The submissions of counsel for the pursuers, on the other hand, may be summarised as follows:
(1)The act, neglect or default upon which the defenders relied was a continuing one and the pursuers were entitled to rely upon section 11(2) of the 1973 Act. The effect of this submission was that the concurrence of damnum and injuria was delayed until 12 January 1994.
(2)The pursuers were also entitled to rely upon section 11(3) of the 1973 Act with the effect that the starting date for prescription was delayed and the introduction of the alternative case occurred within the quinquennium.
(3)The pursuers also relied upon section 6(4) of the 1973 Act to enable them to exclude from the quinquennium the period during which the pursuers were induced to refrain from making a relevant claim because of error induced by the defenders. This would also have the result that the introduction of the alternative case occurred within the quinquennium.
[7]Counsel for the defenders adopted the approach of considering each of the obligations specified in Articles XI and XII of condescendence as separable and that once the period of five years had elapsed in respect of each obligation, that obligation became unenforceable. Senior counsel for the defenders relied upon the opinion of Oliver J in Midland Bank Trust Co. Ltd and Another v Hett, Stubbs & Kemp 1979 1 Ch. 384. In dealing with an obligation by a solicitor to fulfil a contractual obligation Oliver J at 435C stated:
"So far as the client is concerned, it is a matter of total indifference to him at what date the solicitor chooses to fulfil his contractual obligation.... so long as it is effectively fulfilled. No doubt a normally careful practitioner would fulfil that obligation as soon as is reasonably practicable.... But if he fails to do so and an effective registration can still be and is effected, his client can have no complaint except the purely technical one that he has been a bit careless and might have done it sooner. He has, no doubt, exhibited a failure to show the normal competence and care for his client's affairs by carelessly allowing a period to elapse during which a third party might have, but has not in fact, acquired an interest. But such a failure cannot, I should have thought, affect, much less discharge, the primary obligation to effect registration timeously, which continues until it is performed or becomes impossible of performance or until the client elects to treat the continued non-performance as a repudiation of the contract."
[8]Mr McNeill, for the defenders, maintained that this passage indicated that the prescriptive period commenced when a particular obligation became impossible of performance. Thus, for example, the obligation...
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