21 December 2018
Craig Anderson v John & Antoinette Imrie [2018] CSIH 79. The Inner House of the Court of Session has issued an opinion which provides some helpful guidance on Pursuers’ Offers. BTO were instructed for the Defenders and Reclaimers and were successful in opposing the Pursuer and Respondent’s motion for an uplift on expenses in terms of RCS 34A.9.
Background
The case of Craig Anderson v John & Antoinette Imrie arose out of an accident on a farm in 2003, in which an 8 year old boy sustained a head injury after he untied a gate from a metal post to which the gate had otherwise been secured and he climbed on to it, only for the gate to fall on him. The crux of the case concerned an alleged failure to adequately supervise the boy.
After Proof, the Lord Ordinary made a finding of liability against the Second Defender alone, even although her evidence, which was accepted by the judge, was that the boy could only have been out of her sight for, at most, 5 minutes. The Lord Ordinary awarded damages to the Pursuer in the sum of £325k, inclusive of a reduction of 25% to reflect the pursuer’s contribution to his own injury.
The Defenders reclaimed (appealed) against the liability decision alone.
After the appeal was marked, the pursuer lodged a Pursuer’s Offer to settle the case in the reduced sum of £300k. The offer was not accepted, the Defenders considering in any event that the offer was incompetent.
The Defender’s reclaiming motion was unsuccessful. The Pursuer then intimated a motion for an award of expenses, plus a 50% uplift on the solicitors fees, being the penalty to be imposed where a Pursuer’s Offer is not accepted in terms of RCS 34A.9. This motion was opposed by the Defenders principally on grounds of competency. The case then returned to the Inner House for an opposed motion hearing in October 2018.
The key point for consideration by the Inner House was whether or not, in these circumstances, it was competent for the Pursuer to lodge a Pursuer’s Offer bearing in mind that it was lodged whilst proceedings were before the Inner House.
Pursuers’ Offers
Readers will be aware that the Pursuers Offers were re-introduced into Scottish procedure in April 2017. The concept was not new.
Pursuers’ offers made a previous brief appearance in the Court of Session Rules in 1996, but were challenged on grounds of vires and ultimately revoked only a couple of months after their implementation. Their reintroduction almost 20 years later brought the position in Scotland more in line with England and Wales, where it is open to a Claimant and a Defendant to lodge a Part 36 offer with the court and then seek to rely on this offer if a sum greater than the sum offered is achieved, or not, as the case may be.
The ‘new’ Rules relating to Pursuers’ Offers in Scotland are found at RCS 34A. The Pursuer’s Offer must be a "genuine attempt to settle” (RCS 34A.8) and “may be made at any time before the Court makes avizandum or, if it does not make avizandum, gives judgment; or in a jury trial, the jury retires to consider the verdict.” (RCS34A.3 (2)). Where a Pursuer’s Offer is not accepted or accepted late, a financial penalty can be imposed on the defender in the form of a 50% uplift on expenses (RCS 34A.9).
Having regard to the wording of the Rules, the Defenders’ position in Anderson was that the Rules envisaged that a Pursuer’s Offer would be made in the context of a case before the Outer House and not the Inner House and that, with the Pursuer’s motion having been intimated at a time when the procedure in the Inner House was well under way, the Pursuer’s motion was incompetent. It was further submitted for the Defenders that to be faced with a financial penalty in rejecting the Pursuer’s Offer would be an unreasonable interference with the Defender’s right to reclaim.
This was challenged by the Pursuer, on the basis that (a) the “Court” is not defined in the Rules as being restricted to the Outer House and (b) it would be ‘unfair’ if Pursuer’s Offers, unlike Tenders, were not available in the Inner House.
Decision
Ultimately, the Inner House favoured the Defenders’ position.
The opinion notes that, although Pursuers’ Offers are not expressly excluded from the Inner House, there are a number of indicators within the Court Rules to suggest that this was the intention. As a result, the Inner House concluded that Pursuers’ Offers are not intended for use where the challenge concerns the final decision of the Outer House. This does not prohibit a pursuer from lodging a Pursuer’s Offer whilst an interlocutory decision is being reclaimed. In that circumstance, the decision on the substantive merits of the case as a whole will still be required to be addressed by the Lord Ordinary.
The court also rejected the pursuer’s submissions regarding fairness, on the basis that the argument failed to acknowledge the ‘superior position’ that the Pursuer would be placed in an appeal of this sort where the only available outcome was complete success for one side or the other (i.e. in an ‘all or nothing’ case, whether either the pursuer would be awarded his damages or would not, bearing in mind that the reclaiming motion concerned liability alone).
It should be noted that the Inner House also found force in the Defenders’ esto argument that, had the Pursuer’s Offer been found to be competent, the offer lodged was not a ‘genuine attempt to settle’. This point was not considered in detail in the judgment, however, given the principal finding of incompetency.
The case provides some welcome guidance to practitioners and insurers alike on the application of the rules on Pursuers’ Offers.
Contact
Catherine Currie, Partner, and Rhona McKerracher, Senior Solicitor, both of BTO’s Catastrophic Injury Team, were instructed on behalf of the Defenders and Reclaimers.
Kay Springham QC appeared as counsel.
Contact:
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Catherine Currie |
Rhona McKerracher |