Decision of the Scottish Land Court

Mrs Mary A Taylor & Mrs Ena Jess (Applicants) v Mrs Mary Ann Morrison (Respondent)

Case reference SLC 127/15
before
Iain F Maclean, Deputy Chairman, and John A Smith
31 May 2017

Note:

[1] In this application (RN SLC/127/15), Mrs Taylor and Mrs Jess (“the Applicants”) applied for an order under section 14(4) of the Crofting Reform (Scotland) Act 2010 (“the 2010 Act”) modifying the entry in the Crofting Register in respect of croft 1A Tolsta Chaolais, Isle of Lewis. That entry in the Crofting Register had been the result of an application for first registration submitted by the then tenant of croft 1A Tolsta Chaolais, Mrs Mary Ann Morrison (“the Respondent”), which provoked two challenges before the end of the 9 month period mentioned in section 12(5) of the 2010 Act, the other being at the instance of John Macaulay (Application RN SLC/119/15). Answers to the two applications were lodged by both the Respondent and Mark Tayburn, the crofter of croft 1C Tolsta Chaolais (“the Interested Party”). The Answers lodged by the Interested Party having called into question the interest of both the Applicants and John Macaulay to challenge the first registration, we made arrangements, as contemplated in rule 11(2)(c) of the Rules of the Scottish Land Court 2014 (“the 2014 Rules”) for the two cases to be heard together in debate (although they were not formally conjoined) on Tuesday 8 November 2016 within Stornoway Sheriff Court.

[2] At the hearing, the Respondent was represented by her brother, Kenneth J MacLennan, in conformity with rule 100(3)(a) of the 2014 Rules, which provides that a party may, with the permission of the court, be represented by a member of the party’s family as defined in section 71 of the Agricultural Holdings (Scotland) Act 2003 (“the 2003 Act”) unless the court is satisfied that it would not be consistent with the just disposal of the case in accordance with rule 1 (Purpose of the rules etc.) of the 2014 Rules. The definition in section 71 of the 2003 Act extends to siblings. The Interested Party was represented at the hearing, with our permission, by Lewis Kermack. Mr Kermack, a non-practising solicitor, was not entitled to appear for the Interested Party at the debate assolicitor in terms of rule 100(2)(a) of the 2014 Rules, and not being a member of the Interested Party’s family, rule 100(3)(a) of the 2014 Rules had no relevance to his situation, but we permitted him to appear for the Interested Party under reference to rule 100(3)(b) of the 2014 Rules, which provides that a party may, with the permission of the court, be represented by any other person where the court is satisfied that the person is likely to be able to present the party’s case efficiently and to assist the court in reaching a just result in accordance with rule 1 of the 2014 Rules.

[3] At the debate in Stornoway Sheriff Court on 8 November 2016, Mr MacLennan was content merely to adopt the written and oral submissions advanced by Mr Kermack for the Interested Party, and did not seek to advance any separate submissions of his own, although he did supply factual information which enabled us to dispose of a preliminary issue raised by the Applicants as to whether the notification requirements of section 12(1) of the 2010 Act had been observed in this case. As we related at paragraph [3] of the Note appended to our Order dated 13 March 2017, somewhat ironically, given that the debate in the two applications was fixed for the purpose of disposing of the Interested Party’s preliminary pleas directed at the interest of the Applicants and of John Macaulay to apply for orders under section 14(4) of the 2010 Act, an issue arose early in the course of the hearing as to whether the Respondent herself retained an interest to oppose the grant of such orders. It emerged that she was no longer the tenant of croft 1A Tolsta Chaolais, she having assigned it on 29 February 2016 to Frances Muriel Berrill, who was, by the date of the hearing on 8 November 2016, entered in the Crofting Register as the tenant thereof. Ms Berrill was aware of the proceedings before the Land Court, but opted not to take part in them. Mr MacLennan explained that the reason for his sister’s continued involvement in the proceedings was that she was under obligation to Ms Berrill in terms of the parties’ bargain to ensure vacant possession of the whole subjects assigned to her and having also been a party to an agreement between the tenants of crofts 1A, 1B and 1C Tolsta Chaolais as to the respective boundaries of their crofts, upon the basis of which the Respondent had proceeded to apply for first registration of croft 1A Tolsta Chaolais, she felt bound by good faith to defend it when it was challenged.

[4] Having heard the parties in debate in Stornoway on 8 November 2016, we made avizandum. By Orders dated 13 March 2017, we sustained the Interested Party’s preliminary pleas and dismissed both this application and Application SLC/119/115. John Macaulay subsequently notified the Principal Clerk of his intention to require that a special case be stated on a question of law for the opinion of the Court of Session in terms of section 1(7) of the Scottish Land Court Act 1993 in respect of the decision in Application RN SLC/119/15, but the Applicants have opted not to appeal the decision in this application.

[5] Both the Interested Party and the Respondent have moved for awards of expenses in their favour against the Applicants under rule 88 (Award of expenses) of the 2014 Rules on the basis of the general rule of expenses following success, by way respectively of a Motion and Submission on Expenses submitted by the Interested Party to the Court under cover of a letter dated 17 March 2017 and a Motion and Submission on Expenses in very similar format and terms submitted by Mr MacLennan on behalf of the Respondent to the Court under cover of a letter dated 20 March 2017. The Applicants contend, in a letter to the Court dated 28 March 2017, that the expenses of the application should be disposed of on a “none due to or by” basis. They argue, in essence, that the merits of the case, by which they mean whether or not the boundaries of croft 1A Tolsta Chaolais have been registered correctly, have not been determined, and they found upon the observation made by the Court, in the Note which accompanied the Orders dated 13 March 2017, that although the Applicants had not averred a sufficient interest to challenge the registration,

“we do not consider that their challenges were in any way either frivolous or vexatious, and we acknowledge that they served to ventilate a difficult and important legal issue.”

[6] The rejoinder of the Interested Party to that, as embodied in his letter to the Court dated 1 April 2017, the terms of which are substantially recapitulated in a letter from Mr MacLennan on behalf of the Respondent dated 4 April 2017, is that the Applicants’ motion proceeds upon the misapprehension that the purpose of an award of expenses is to punish the unsuccessful party. The true position, they maintain, is as stated by Lord President Robertson in Shepherd v Elliot (1896) 23 R 695 at page 696:

“The principle upon which the Court proceeds in awarding expenses is that the cost of litigation should fall on him who has caused it. The general rule for applying this principle is that costs follow the event, the ratio being that the rights of parties are to be taken to have been all along such as the ultimate decree declares them to be, and that whosoever has resisted the vindication of those rights whether by action or defence, is prima facie to blame.”

[7] The Interested Party and Mr MacLennan, in citing that well known dictum in their respective letters to the Court, were somewhat selective in their quotation therefrom, in that they omitted any reference to the important caveat, appearing in the very next sentence, which the Lord President attached thereto, in the following terms:

“In some cases, however, the application of the general rule would not carry out the principle, and the Court has always, on cause shewn, considered whether the conduct of the successful party, either during the litigation, or in the matters giving rise to the litigation, has not either caused or contributed to bring about the law suit.”

Although the Applicants, in a further letter to the Court dated 7 April 2017, question the continuing relevance of that authority on the basis, essentially, of its antiquity, it should be noted that the approach to expenses advocated by the Lord President in Shepherd v Elliot was endorsed by the Full Court in Gourlay v Doble & Wallace 2011 SLCR 55.

[8] The Applicants, in their letter to the Court dated 7 April 2017, also observe, somewhat cryptically, that:

“If the Court is satisfied, at this stage, that all the Motions received would allow it to proceed to apportion expenses now, we would expect to be advised shortly. If, however, any issue has arisen which would prevent the Court from so doing correctly and fairly, we respectfully suggest that the matter of expenses is deferred for the time being.”

Discussion

[9] We shall commence our discussion of the issues arising out of the expenses motions by addressing that last point first. We take the Applicants there to be alluding to the fact that John Macaulay has asked us to state a case to the Inner House of the Court of Session in Application RN SLC/119/15. The fact that there is a pending appeal in Application RN SLC/119/15 can have no bearing on the issue of expenses in this application, and consequently provides no reason why we should not proceed to deal with that issue now. The Applicants have not appealed our decision in this application, and so it will stand as a final decision, regardless of the outcome of John Macaulay’s appeal.

[10] Whilst, as we acknowledged in the Note appended to our Orders dated 13 March 2017, there was a genuine issue to try here, the Interested Party ultimately was successful in securing the dismissal of the application upon the basis that the Applicants failed at debate to demonstrate that they had an interest to challenge the first registration of croft 1A Tolsta Chaolais in the Crofting Register. Whilst it is correct to say that the Court has not determined the substantive merits of the various points made by the Applicants against the boundaries of croft 1A Tolsta Chaolais as registered, that avails them not at all where the Court has held that they have no interest to advance those arguments under the legislation.

We see nothing in the Interested Party’s conduct of the litigation that would provide grounds for us to deny him an award of the expenses of the application against the Applicants.

[11] In moving for an award of expenses in his favour, the Interested Party invokes rule 91 (Expenses of representative who is not an advocate or solicitor) of the 2014 Rules. Rule 91 provides:

“(1) Where a party is represented by a person who is not an advocate or solicitor the court may, in finding the party liable in expenses, allow, or direct the auditor to allow, expenses comprising -

(a) outlays which, in all the circumstances, appear to the auditor to have been reasonably incurred for the proper conduct of the case; and

(b) remuneration for the person’s services, being remuneration proportionate to the extent of those services and the value of the case.

(2) Unless the court on special cause shown otherwise directs, any amount allowed under subparagraph (1)(b) is not to exceed two-thirds of the amount which would have been allowed as expenses under these rules to a solicitor representing a party.”

[12] The term “solicitor” is defined in rule 2 (Interpretation) of the 2014 Rules as meaning “a solicitor qualified in terms of section 4 of the Solicitors (Scotland) Act 1980”, which statutory provision in turn states that:

“No person shall be qualified to practice as a solicitor unless –

he has been admitted as a solicitor; and

(a) his name is on the roll; and

(b) … he has in force a certificate issued by the Council [of the Law Society of Scotland] … authorising him to practice as a solicitor (referred to in this Act as a “practising certificate”)”.

Mr Kermack informed us at the hearing in Stornoway that he did not currently have a practising certificate. He therefore does not fall within the definition of “solicitor” in rule 2 of the 2014 Rules, and so it may be said that the Interested Party was here represented by a person who is not an advocate or solicitor, as the term “solicitor” is used in rule 91 of the 2014 Rules. It is, accordingly, open to us to direct the auditor to allow expenses in conformity with rule 91(1), and this we shall do. We are satisfied that, in the particular circumstances of this case, it would be appropriate to allow the maximum sanctioned by rule 91(2), being two-thirds of the amount which would have been allowed as expenses under the 2014 Rules to a solicitor representing a party, by way of remuneration for Mr Kermack’s services, to reflect the knowledge, expertise and experience he brought to bear on the proceedings.

[13] Expenses common to more than one action brought on the same grounds should normally be apportioned amongst the parties liable so that each such party is liable only for a proportionate part: Lujo Properties Ltd v Schuh Ltd 2009 SLT 553 per Lord Drummond Young at paragraph [7]. Here, it seems to us, from our scrutiny of the contents of the Interested Party’s pleadings and written submissions in the two applications and from listening at debate to Mr Kermack’s oral submissions, the contents of which for the most part were applicable as a response to both, that the bulk of the expenses incurred by the Interested Party in resisting the challenges to the first registration of croft 1A Tolsta Chaolais were common to the two applications in the sense discussed by Lord Drummond Young, and consequently we have, in our order awarding the Interested Party his expenses, for the avoidance of doubt, and for the guidance of the auditor of court, restricted the award to such amount as the auditor of court shall consider represents a fair apportionment as between the two applications.

[14] The position of the Respondent is distinguishable from that of the Interested Party when it comes to the expenses of the application. We have already related how, in the course of the debate, an issue arose as to whether the Respondent retained any interest to oppose the two applications. We did not require to reach a concluded view on that issue at that stage, it being enough for the disposal of the two applications that we sustained the preliminary pleas for the Interested Party, which we did in our Orders dated 13 March 2017, but the Respondent’s expenses motion means that we must address it formally now.

[15] When this application was commenced on 16 December 2015, the Applicants called Mrs Mary Ann Morrison as a respondent, and by dint thereof she unquestionably had title to defend the challenge to first registration of croft 1A Tolsta Chaolais, of which she was then the tenant. By letter dated 30 April 2016, Mr MacLennan advised the Court that the croft had been assigned to Ms Berrill on 29 February 2016. The Court on 4 May 2016 wrote to Ms Berrill’s solicitors to afford her the opportunity to enter the process, given her interest in the matter. As at the date upon which the Court wrote to Ms Berrill’s solicitors, the Respondent was still shown as tenant of croft 1A Tolsta Chaolais on the Crofting Register, but by the date of her solicitors’ reply to the Court on 19 May 2016, Ms Berrill’s name had been entered as tenant. Her solicitors confirmed to the Court that their client did not wish to enter the process as a party.

[16] In his letter to the Court dated 1 April 2017, the Interested Party states, in support of his expenses motion, that “Both I and Mrs Morrison have been entirely successful in vindicating our rights”, but that statement begs the question what rights the latter had to vindicate. She had ceased to be the tenant months before. Ms Berrill might have substituted herself as a party in place of the Respondent (cf. rule 10(d)(i) of the 2014 Rules) but she chose not to do so. We do not consider that, after she assigned in favour of Ms Berrill, the Respondent retained any interest to continue to defend the application. We consider it to be axiomatic that if the Respondent had no interest to defend those proceedings, the Applicants cannot be held liable for any expenses she may have incurred by so doing.

[17] Even if we are wrong about that, however, we would not have been minded to make any award of expenses in favour of the Respondent, on the basis that from the point at which the Interested Party, who had not been called as a respondent, entered the process on 6 October 2016 to represent the interests of the crofters who had agreed the boundaries of croft 1A Tolsta Chaolais for the purpose of first registration, the continued involvement of the Respondent, who had no separate interest to defend, was rendered quite superfluous. That involvement in substantial part simply duplicated the efforts of the Interested Party and served no useful purpose. As we already have acknowledged, Mr MacLennan did assist the Court at the debate, by confirming that in assisting his sister to submit her application for first registration of croft 1A Tolsta Chaolais in the Crofting Register, he had omitted to identify the Applicants on the form as persons mentioned in section 12(3)(i) of the 2010 Act (i.e. the owner[s] of adjacent land (not being land which is an adjacent croft)), and as such persons entitled to receive notification from the Commission of the matters referred to in section 12(4) of the 2010 Act, as required by section 12(1) of the 2010 Act, but given that in so doing, he was merely helping to tidy up a mess of his own making, we do not consider that this factor constitutes a justification for the continued participation of the Respondent in the proceedings at the Applicants’ expense: cf. Robertson v City of Edinburgh Licensing Board 1994 SC 83 at pages 85-86.