Litigation

Litigation

(UPDATE ARTICLE FOR Scottish Law Agents GAZETTE – 28 February 2013)

Sheriff Court Round Up

Adults with Incapacity

The past few months has seen some more unusual cases coming through arising out of the provisions of the Adults with Incapacity (Scotland) 2000. In the case of A and B, Solicitors, as continuing Attorneys, and C Welfare Attorney in respect of D, the Adult, two solicitors had been appointed as continuing attorneys under a Power of Attorney in terms of Section 15 of the Act and appointed by the Adult. C was a consultant psychiatrist and lifelong friend of the Adult. He also specialised in the area of needs of and care required for adults with incapacity.

C lost capacity due to a degenerative condition and was certified as incapax. She had been residing with her son E and it became apparent to A, B and C that their efforts to act in the best interests of the Adult were being continually interfered with and thwarted by E. In providing the initial instructions to her solicitors the Adult had advised that she did not wish her son, E, to be appointed in relation to welfare or finance matters. As a result of various circumstances which resulted in the Adult (who usually lived with E) being admitted to hospital under adult protection matters A, B and C required to take decisions including whether A could go back to live with E or whether she should be re-accommodated in a nursing home.

At interview the adult was expressing a wish to return home and to the care of E. However, none of the Attorneys believed that this was in her best interests although that was her contemporary view. As a result an application for Directions was made under Section 33 of the Act. This can be done by a minute for Directions. A Direction is a form of intervention. The Sheriff reviewed the position as to when this would be appropriate noting that the Sheriff must not authorise any form of intervention unless satisfied that it will benefit the adult. Also the Sheriff requires to consider whether he is allowed to intervene in the affairs of the adult and can only do so where the benefit sought cannot reasonably by achieved without such intervention. The intervention also must be the least restrictive option in relation to the Adult’s freedom but in determining when to do so account has to be taken of both the past and the present wishes of the adult together with the views of the nearest relative primary carer etc.

In this case the views of the Attorneys and the nearest relative were in complete conflict with each other and what became of considerable importance of the case was the weight that was attached to the past views of the adult as expressed before she became incapax.

Accordingly it may be important for solicitors in practice, when taking instructions for a continuing Power of Attorney, to do some “future thinking” with the Adult as to what they would wish in the event of a loss of capacity .

In the case of Mr JM and Mrs JM an application was brought under the Act seeking appointments of 2 of their children as Guardians. The application itself was non-controversial. However the Sheriff found that there was an example within the case of a situation where it was desired to alter the financial affairs with the adults where both had lost capacity to do so themselves. This is a further decision of Sheriff Baird at Glasgow. In this case Mr and Mrs M had resided together for many years in a house tenanted from a Housing Association but in an area where the legislation allowed them to purchase the house.

They were assisted in doing so by their son who took on the financial responsibilities in respect of the purchase. Solicitors were consulted and a Minute of Agreement was drawn up to put the arrangements in place and Wills were also drawn up in the names of both adults providing that on the death of the last of them the house was bequeathed to the son in recognition of the steps that he had taken to ensure their financial security.

The son had maintained his obligations under the Minute of Agreement. However with the onset of dementia in respect of both parents, neither was able to sustain living in the family home and both now required nursing and care home accommodation with fees exigible by reason of their ownership of their property.

The only way to realise those funds was by way of sale of the house. However the son was unprotected in respect of the heritable property. An application was made for a particular intervention which was to grant a Standard Security in favour of the son in recognition of his considerable financial outlays on his parents’ behalf over the last 16 years.

From Sheriff Baird’s Opinion it would appear that substantial evidence was made available to the court (in this case the Minute of Agreement, the Wills, financial records, detailed vouching, agreement of other siblings and testimonials as to the character of the applicants) the Sheriff was prepared to authorise that the Guardians could grant a Standard Security over the Adult’s heritable property .

Guardian’s Divorce?

The position of what happens when a person becomes incapax and what power their Guardian may have in respect of divorce was dealt with in the case of GWS qua Guardian of JH. In this case JH was the husband and KH was the wife. JH was involved in an accident in respect of which he suffered catastrophic injuries and GWS was appointed initially as his Curator Bonus and subsequently as Financial Guardian, initially in 2002, and renewed in 2009 without limit of time subject to the standard powers which include the power to raise or defend any court actions.

The Pursuer raised an action of divorce on behalf of the Adult relying on the general power to litigate and seeking orders of financial provision under the Family Law (Scotland) Act 1985. In this case the defender did not wish to be divorced and raised the point as to whether the pursuer had title to sue. The defenders submission was that a pursuer must have capacity, title and interest to sue. Following upon the abolition of the Office of Curator Bonus by the 2000 Act it remains the law that where in an action of divorce it remains the law that where in an action for divorce or separation it appears to the Sheriff that the defender is suffering from a mental disorder the Sheriff must appoint a Curator ad litem (Rule 33.16 of OCR 1993 and Section 11 of the 1976 Act). However there is no equivalent rule for a pursuer.

The 2000 Act sets out a statutory framework for intervention including appointing the Financial Guardian with general powers to litigate on behalf of an adult with incapacity. Whilst it would be right and proper for a Financial Guardian to pursue an action of divorce, the defender submitted that this could only be done where power to do so had been conferred by an application under Section 64.(1)c of the 2000 Act. Not only that, but that application would require to be granted and the power conferred prior to the raising of the proceedings, so that the Guardian had title to sue as at the date of raising proceedings. The defenders submitted that the general power of Financial Guardian to litigate does not include a very specific power to raise or defend court proceedings. In the absence of that power the pursuer had no title to sue and, moreover, could not cure the defect by now applying for such powers.

The pursuer’s submission, presumably having recognised some force in the defender’s argument sought to sist the cause to enable the pursuer to make a separate application to complete the title under section 64. (1) c of the Act.

In this case the Sheriff took that view that the pursuer had capacity to act on behalf of the adult but only insofar as authorised by his powers. He did not have a specific power to raise an action of divorce. This defect was a fundamental defect which could not be cured by now making an application for those powers. As a result the action was dismissed .

Ejection and Reasonableness

In an action brought by Stirling Council against a tenant the defender opposed decree for ejection on the grounds of reasonableness.

The tenants had a fairly disastrous history with regard to falling into rent arrears. In the course of their tenancy 5 court actions had been raised against them in respect of rent arrears and a previous tenancy had been terminated following upon the grant of a decree for eviction. The defenders husband had been diagnosed with a disease seriously affecting his ability to work and the family were clearly in considerable financial difficulty. The local authority had offered assistance through its housing department money advice team and income maximisation team.

Evidence was presented that the defenders husband suffered from serious health problems and depression and there was medical evidence which was accepted to the effect that his health would be at risk if ejected. The Sheriff rehearsed the arguments as to the direct and indirect effect of the “conduct”. In this the conduct was non-payment of rent and the Sheriff considered whether an impact on the husband’s health could be considered an indirect effect of the failure to pay rent. The Sheriff considered that it was in indirect effect and therefore should be taken into account. At the date of the proof the defender was not in arrears with rental payments. The Sheriff found that the defender would be prejudiced in that she would need to be rehoused and the effect on her husband was likely to be “major” and likely to exacerbate his health problems. In all the circumstances the Sheriff concluded that it would not be reasonable to grant the order sought .

Section 29 Claims on Death of Cohabitant

The provisions of this section were considered on appeal in the case of Kerr in which interesting arguments were run as to whether claims under Section 29 were rights of succession such that they would have an impact on the provisions of the Succession (Scotland) Act 1964 or whether it was a stand-alone provision conferring a right to claim and was a statutory innovation.

The matter was of relevance in this case because there was heritable property in another country, the value of which may or may not have been caught by the definition of the “net intestate estate” resulting in a difference in the Pursuer’s entitlement depending on the of just over £36,000.

On Appeal case the Sheriff Principal opined that the principals of Scots Law and hence Scots private international law would provide that Section 29 could not be read as contrary to those principals. The respondent’s arguments to the effect that Section 29 innovates on the law of succession were preferred to the argument of it being a standalone statutory provision.

Fixtures and Fittings

In general conveyancing, clients often ask what is meant by fixtures and fittings and a neat summary of the definition can be found in Sheriff McGowan’s Decision in Paragon V Manclark . “The classic test is the distinction between moveables and fixtures and fittings. Fixtures and fittings are items which do not have a functional purpose in their own right if removed from the heritable property to which they are attached.”

Licensing

Two sets of appeals were lodged with the Sheriff Principal at Aberdeen in respect of decisions of Aberdeen Licensing Board to suspend Liquor licences. In the case of Epic the Sheriff Principal described the circumstances from which the appeal arose as a “lamentable series of events caused by the defenders”. There were various breaches of natural justice alleged including:- a member of the defenders board having been asleep but having subsequently taken part in the deliberations; objections having been heard from the police without allowing the applicants agent to respond; failing to vote in public and misrepresentation by the defender’s convenor.

Not surprisingly the pursuers moved to have the decision of the defender suspended ad interim and ultimately (after what appeared to be close questioning by the Sheriff Principal) that motion was not opposed.

The decision was reversed but what happened then is of interest. Clearly the defenders wished to have the matter remitted back to the Licensing Board so that, their failings having been pointed out to them, “these errors of procedure” could be best rectified by a re-hearing.

The Sheriff Principal however took the view that the breaches were, individually and collectively, so serious that a remit was inappropriate .

A similar fate awaited the Licensing Board on 2 appeals which were held together with the cases of Ask Entertainment against decisions of the Aberdeen licensing Board to the Sheriff Principal.

There was considerable history that is particular to the circumstances of the licensed premises in question and in this case it would appear that whilst the Licensing Board had identified the correct test which should have been applied. The question then arose, however, whether they had applied it correctly. A challenge was also made to the factual basis of the decision and the adequate reasons given. Again the decisions of the Licensing Board were reversed and the solicitor for the Board moved that they should be remitted back for consideration.

However the Sheriff Principal took the view that there had been insufficient material evidence before the defenders which would have entitled them to come to the conclusions which they did and that no purpose would be served by remit and he accordingly simply reversed the original decisions .

Know your enemy?

The case of Farrans was a lengthy case concerning the tendering procedure in respect of some civil engineering works for Glasgow City Council.

An interesting legal point, however, arises in respect that the pursuer, in the course of the proceedings (and some 4 years after the conclusion of the tendering process) disclosed at proof that it was a company with dormant status. Objection was taken to whether it had any right, title or interest to sue. The pursuer was not an operating company and therefore had no assets, employees or resources to carry out the works. It was not capable of carrying out any works and, in any event, could not have generated profit as a dormant company nor was there any loss or damage which it could recover.

The action was accordingly dismissed the Pursuer having been found to have no title or interest to sue .

Georgette Herd
Kirkwall
28 February 2013

Words 2454

A and B Solicitors and C in respect of D – Aberdeen Sheriff Court 11/02/13
JM and Mrs JM Sheriff J Baird, Glasgow Sheriff Court 25/01/13
GWS qua Guardian to JH against KH Aberdeen Sheriff Court 03/04/12
Judgement Stirling Council v Harrower, Stirling Sheriff Court 04/12/12
Judgement Kerr v Mangan and others, Sheriff Principal Dunlop QC 15/02/13
Judgement Paragon Housing Association Ltd v Manclark, Sheriff K J McGowan 08/02/13
Epic Group (Scotland) Ltd v Aberdeen Licensing Board, Sheriff Principal Pyle Aberdeen 11/02/13
Ask Entertainment Pub Limited v Aberdeen Licensing Board, Case Numbers B591 and B595/12, Sheriff Principal Pyle Aberdeen Sheriff Court
Farrans (Construction) Limited v Glasgow City Council Sheriff NA Ross, Glasgow Sheriff Court 12/02/13

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