Susan Alexander, Robert Fife, Audrey Hendry, Robert Henderson And Brenda Scott Against Marshall & Ross Munro, Charles J Bow And Patricia E Grzybek
| Jurisdiction | Scotland |
| Judge | Lady Wolffe |
| Neutral Citation | [2018] CSOH 1 |
| Date | 05 January 2018 |
| Docket Number | CA6/14 |
| Court | Court of Session |
| Published date | 05 January 2018 |
OUTER HOUSE, COURT OF SESSION
[2018] CSOH 1
CA6/14
OPINION OF LADY WOLFFE
In the cause
SUSAN ALEXANDER, ROBERT FIFE, AUDREY HENDRY, ROBERT HENDERSON
AND BRENDA SCOTT
Pursuers
against
MARSHALL ROSS & MUNRO, CHARLES J BOW AND PATRICIA E GRZYBEK
Defenders
Pursuers: Connal QC (sol adv); Pinsent Masons LLP
Defenders: J Brown; BLM
5 January 2018
Introduction
The Parties
[1] The pursuers in this action are the Trustees of the Scottish Solicitors Staff Pension
Fund (“the Fund”). They call as defenders the firm of Marshall Ross & Munro (“the first
defender”) and the individual partners thereof, namely Charles Bow (“the second
defender”) and Patricia Grzybek (“the third defender”). The first defender was dissolved
with effect from 31 March 2015, when the third defender retired from the firm. The second
defender continued in practice as a sole practitioner. The second and third defenders are
called as the former partners (and hence cautioners) of the first defender. Latterly, the
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pursuers added an alternative case directed against the second defender in his personal
capacity (“the pursuers’ alternative case”). As will be seen, Mr Connal did not distinguish
between the different forms of the rules applicable from time to time. Accordingly, where
there is no differentiation as to the terms of the rules as they applied from time to time to the
Fund, I shall simply refer to them generically as “the rules” and “the scheme”.
The Nature of the Sum Claimed
[2] The sum claimed, amounting to just under £90,000, is said to represent that part of
the deficit in the Fund (“the deficit”) arising in respect of three individuals whom I shall
refer to a Mr H, Ms W and Mrs M and collectively as “the Members”. The Members were
formerly employees of one or more of the former iterations of the first defender.
The Former Iterations of the First Defender
[3] The first defender is sued as the successor of a number of partnerships, commencing
with the formation of the firm of W.M. Marshall Ross & Munro on 30 December 1949
(“MRM1”). (In using the terms “successor” or “predecessor” I make no assumption in
respect of the continuity of the business or the transmission of liabilities from one iteration
to any later entity of the same name.) The defenders lodged a document identifying what
they say were some 16 iterations of the first defender’s predecessors. These different
iterations occurred from time to time over a period of 58 years and resulted from the
retirement and assumption of new partners, dissolutions, new partnership agreements, a
merger and one de-merger. In submissions, the defenders relied in particular on an
acrimonious dispute in 1989, which did not entail the transfer or use of the whole assets of
the then business (the partnership of MRM dissolved, with two partners forming their own
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partnership and the remaining partners forming MRM12) and a demerger in 2006. The first
defender is the 17th iteration (“MRM17”). It was formed in August 2006 and is now
dissolved. In terms of that document, the second defender was a partner of iterations
MRM7 (in 1979) to MRM16 (which was dissolved in August 2006). The third defender was a
partner only of iterations MRM16 and MRM17. MRM17 was dissolved when the third
defender retired from private practice. These matters are not all agreed, but it is helpful to
understand the defenders’ position, as the pursuers added averments to address some of
these matters.
[4] The pursuers acknowledged that the first defenders never directly employed any of
the Members in question. The last date on which any of the three Members was employed
by one of the former iterations of the first defender was either in 1991 or, at the latest, in
about February 1994, during the existence of MRM13. The other two Members retired,
respectively, in 1986 and 1989.
Legal Issues
Outline of Basis of Liability the Pursuers Rely Upon against the First Defenders
[5] The pursuers do not seek to trace the evolution of these iterations. Nor do they seek
to identify the character or quantum of any liability of any individual iteration at any point
in time. The pursuers assert that the first defender “inherited” the liabilities of its
predecessors. (The pursuers lodged a notice of basis of calculation of liability, No 21 of
process, but this simply sets out in general terms how an apportionment of the Fund deficit
is calculated, together with a breakdown of the split between Members. It does not identify
any part of the deficit attributable to any Member’s service with any prior iteration of the
first defenders.) Rather, the pursuers rely on the proposition that liability has transmitted
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