Outer House allows proof before answer in Berwickshire castle sale dispute

The Outer House of the Court of Session has continued a case involving a dispute based on the sale of a castle in Berwickshire and accompanying barony to allow the parties a proof before answer.

Richard Syred and another purchased Ayton Castle, together with the Dignity of the Barony of Ayton, from Lady Christine De La Rue and another in their capacity as executors of the late David Liddell-Grainger.

The case was heard by Lord Arthurson.

Breach of missives

It was a matter of agreement between the parties that the defenders were unable to perform certain obligations under the missives by the date of entry, 15 July 2014, including the exhibition of a water test certificate up to four weeks prior to that date. It was agreed that the pursuers would retain £100,000 pending resolution of all outstanding matters.

The pursuers alleged that the defenders had wrongly removed certain fireplaces and wall lights prior to the date of entry, and sought decree of specific implement for their return and payment in respect of reinstatement costs. Failing that, they sought redecoration costs as well as payment in respect of the items.

The pursuers also sought declarator that the defenders were in breach of the water supply clause of the missives. They contended that the water supply to the subjects was not of adequate quality and that the defenders had not exhibited the required water test certificate, and sought further payment for connecting the subjects to the mains water supply.

The defenders submitted that the pursuers had failed to specify in appropriate detail what items were missing. There were no averments in respect of the particulars or value of the items as required for a decree ad factum praestandum. Furthermore, at the date of settlement, there were no fireplaces in the bedrooms, these items having been removed well in advance.

In respect of the water supply, the defenders admitted that they had not exhibited the relevant certificate, but the pursuers had impliedly waived this obligation by agreeing a retention of monies to cover this. In any event, the clause itself only referred to the Ayton Castle building only, and not the wider estate that formed part of the subjects.

The pursuers submitted that references in the missives to Ayton Castle were references to the whole of the subjects to be conveyed, as it was plain from the offer letter that sale of the whole subjects and accompanying barony was what was in consideration.

Regarding the implied waiver argument, the pursuers submitted that the defenders’ averred contentions, to the effect that the pursuers had simply proceeded to settlement and made a separate arrangement concerning retention, did not constitute a relevantly pled case of waiver.

An element of probation

In his opinion, Lord Arthurson first considered the matter of the fireplaces, saying: “I have reached the view that ample specification of the items in question has been provided within the corpus of the pursuers’ pleadings, and in particular within article 4 thereof and in the operative conclusion seeking a delivery order. The various items, their number and their location are expressly averred upon by the pursuers. The component parts of the fireplaces, namely white marble mantles, friezes and jambs, are also set out.”

He continued: “It is averred in article 4 that the subjects were in the control of the defenders and occupied by one of the executors named as a defender in the action. Absent photographic material or a detailed incorporated report from a professional person such as a surveyor or valuer, it is difficult to see what further precision by way of averment can be required of the pursuers in such circumstances.”

Regarding the implied waiver arguments in respect of the water test certificate clause, he said: “In the offer letter dated 29 January 2014 the whole heritable subjects to be transferred by subsequent disposition are defined as Ayton Castle. In my view, the warranty in clause 7.1 in respect of adequate quality and compliance with the [Private Water Supplies (Scotland) Regulations 2006], can only be read as relating to the private water supply to these subjects, and I see no difficulty with that claim proceeding to proof as presently averred.”

He continued: “While on balance it cannot be said that the defenders have not advanced a relevant case of waiver, it would certainly at this stage be inappropriate in terms to strike out this section of the pursuers’ case on breach of clause 7.1. Cases in which the court requires to consider the issue of waiver are inevitably highly fact-sensitive, and the authors of Reid & Blackie, state this position expressly […] in the following terms: ‘Waiver is regarded as a matter of fact: the conduct in question is viewed objectively to ascertain whether it is consistent with a continuing intention to exercise the right.’”

On how this applied in the present case, he said: “The pleading of specific facts and circumstances in that particular context may well be enough to set up a potentially relevant case of waiver. The present case advanced for the defenders on this issue is to the effect that the settlement of the transaction proceeded on the scheduled date of entry notwithstanding the pursuers knowing full well that it was by then impossible for the defenders to exhibit the relevant water test certificate. Furthermore, parties agreed that a significant sum should be retained. This circumstantial background could potentially be commensurate or, equally, not commensurate at all, with such a deemed abandonment.”

Having heard the submissions from both parties, his conclusion was: “None of the points arising in the discussion which proceeded before me can or should be resolved without at least an element of probation. In these circumstances the interlocutor accompanying this opinion will simply pronounce that parties will be allowed a proof before answer of their whole averments, with all pleas standing.”