Liability for Expenses Modified

Sheriff McGowan’s Decision in the case of Gibson v Menzies Aviation (UK) Limited 2016 SC EDIN 5 of 16.12.15 was issued on 16.01.16.

The Defender lodged a Tender for £12,000.  This was accepted by the Pursuer and the case called for Decree in terms of the Minute of Tender and Acceptance.

The Defender opposed the Motion on the basis that, insofar as it related to expenses, these should be refused and the Defender’s liability should be modified to nil.  It was argued that the Action had been premature and unnecessary and that the Pursuer’s Solicitors’ conduct had been unreasonable.

Prior to the raising of an Action liability had been admitted.  The Defender’s Insurers were signatories to the Pre-Action Protocol.  The Insurers had asked for sight of the relevant medical evidence and offered rehabilitation.  There had been no meaningful discussions and the medical evidence had been withheld.  It was unreasonable to raise an Action.  Even after the Action had been raised, it was alleged there was a refusal to disclose the medical evidence.  The Pursuer’s Solicitors’ position was that there was no point in disclosing a Medical Report until earnings information had been made available.  They couldn’t value the claim without the earnings information.

The Pursuer maintained that the Defender’s submissions were misleading.  Without post-accident earnings details the claim could not be properly valued.  To obtain details of post-accident earnings the Solicitors had had to obtain the appropriate Court Order by way of a Specification of Documents.

The Sheriff set out the relevant timeline and went on to say that it was clear the Insurers had made “numerous efforts” to obtain information from the Pursuer’s Solicitors.  In his opinion, when considered along with the admission of liability, it should have been apparent to the Pursuer’s Solicitors that the Insurers wished to value the claim and negotiate it.

In the Sheriff’s view, apart from the issue of missing earnings information, “…there was no sound reason for the Pursuer’s Agents to fail to disclose the medical evidence as soon as it was available”.  It should have been disclosed before the Action was raised.

The Sheriff then considered whether the failure to disclose the medical evidence caused or contributed to the Action being raised.  He suggested the appropriate question was “What would have happened had the Medical Reports been disclosed timeously?”

He went on to consider this question against the background of what had occurred in the claim and took the view that the raising of the Action was unreasonable and had deprived the Insurers of “a genuine opportunity” to settle the claim prior to the Action.  There was a reasonable chance that if disclosure had been carried out, the claim would have settled.

As a result he granted the Pursuer’s Motion for expenses but decided that liability should be modified by two thirds ie. the Pursuer obtained an award of one third of the appropriate expenses.

While each case depends on its own individual circumstances, it is clear that in this one the Sheriff was completely unimpressed by the failure to provide the medical evidence pre-litigation.  It is encouraging to see that in an appropriate case a Court is prepared to modify Court expenses.

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