Background
Sheriff Court case considering a purported lease of chip shop (which was converted from a petrol station forecourt shop) on South Uist. In early 2005, the parties reached a verbal agreement under which Mr Gray would lease the premises from Mr MacNeil for 15 years in return for paying staffing and running costs which would constitute rent. The agreement was not put in writing. Mr Gray bought equipment and the property was converted for use as a chip shop which opened for business in July 2005. The relationship between the parties deteriorated and in 2008, following a dispute, Mr MacNeil cut the electricity to the property and refused Mr Gray entry to the property. Mr MacNeil died in 2015 and Mr Gray raised an action against Mr MacNeil’s excecutor (Mr MacNeil Jnr).

Issues
There were essentially two issues for the court:

1. Whether Mr Gray was entitled to the return of the chip shop equipment (or alternatively payment of the value of the chip shop equipment); and
2. Whether, despite the legal requirement for the lease to be in writing, Mr Gray could recover damages (i.e. his loss of future profits) for material breach of the purported lease on the basis of the personal bar provisions contained in the Requirements of Writing (Scotland) Act 1995.

Decision
Return of the equipment
The sheriff found, on the evidence, that the chip shop equipment belonged to Mr Gray. Although, Mr MacNeil Jnr argued that that the equipment had nonetheless acceded[1] to the property, he failed to provide evidence relating to the conditions required (physical union, functional subordination and permanency) for accession to occur and the sheriff found that accession had not taken place.[2]

Verbal lease
Although a lease for more than a year requires to be in writing[3], Mr Gray argued that, in terms of the personal bar provisions contained in the 1995 Act[4], because Mr Gray had acted in reliance of the verbal lease with the knowledge and acquiescence of Mr MacNeil, Mr MacNeil had not been entitled to withdraw from the contract. However, after considering previous authorities[5], the sheriff found that the personal bar provisions in the 1995 Act only apply to the creation of rights which are purely personal whereas the verbal lease would also create real rights[6] (i.e. rights which are enforceable against the world rather than rights enforceable only between contracting parties). As such, the verbal lease was invalid and Mr MacNeil had been entitled to withdraw from it[7].

The full judgement is available from Scottish Courts here.

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[1] I.e. that the equipment had been fixed to the building in such a way as to become part of it (meaning that the owner of the building would also become the owner of the equipment).

[2] However there were some technical difficulties with Mr Gray’s pleadings regarding relating to delivery of the equipment/payment of the value and a further heading was fixed in that regard.

[3] 1995 Act s1(7).

[4] Section 1(3) and (4).

[5] The Advice Centre for Mortgages v McNicoll 2006 SLT 591 and Gyle Shopping Centre General Partners Ltd v Marks and Spencer PLC, [2014] CSOH 122

[6] The verbal lease effected the creation of a real right in land (in the same way, for example, as a disposition effects the creation of real rights in land) in contrast to being purely a contract for the creation of a real right (i.e creating personal rights relating to the creation of a real right to be effected in a future conveyance, in the same way as missives are a contract for the creation of a real right in land – with the real right then being created by the subsequent registration of the disposition which the seller will be obliged to deliver in terms of the missives.) Although a lease can be seen both as a contract for the creation of a real right in land and as effecting a real right in land, the courts have taken the view (after consideration of the Scottish Law Commission’s, Report on Requirements of Writing (Report No112) at para 2.50) that the personal bar provisions contained in the 1995 Act cannot apply in situations where real rights are actually conveyed (even if a contract for the creation of an interest in land is created at the same time).

[7] The sheriff also noted that the result seemed harsh in the circumstances of the case.

Background
Outer House case concerning the ownership of a house in Paisley. Title of the house was held in the name of Mr and Mrs Hill, equally between them and to the survivor, and was registered in the Land Register for Scotland in 1989.

Mrs Hill died in 1991. The court heard evidence to the effect that, shortly before her death, Mrs Hill had executed a codicil to her will in which she purported to revoke the survivorship destination in favour of Mr Hill. When she died, Mrs Hill’s share of the house was included in her estate for confirmation. Her son executed a formal nomination of entitlement to Mrs Hill’s share and then registered the nomination in the Land Register.

Arguments
Mr Hill argued that Mrs Hill did not have the power to evacuate the survivorship destination, and amongst other things, sought declarator that he had acquired title to the house on his wife’s death and an order ordaining the Keeper of the Registers of Scotland to rectify the register to that effect.

On the other hand, Mr Hill’s son argued that Mrs Hill had evacuated the survivorship destination and willed her share of the house to the son. Even if Mrs Hill had not been entitled to evacuate the survivorship destination, it was contended that (1) the son had acquired title by the operation of 10 years positive prescription based on the nomination registered in the Land Register and (2) that Mr Hill was personally barred from claiming title to the property and seeking rectification of the property due to mora, taciturnity and acquiescence (i.e. that there had undue delay and failure to assert a claim (on Mr Hill’s part) in a situation in which it would be expected that Mr Hill would have spoken up and that, viewed objectively, the facts suggested that Mr Hill had accepted his son’s ownership of the property).

Decision
Lord Jones rejected the son’s arguments.

The survivorship destination
With regard to the survivorship destination, Lord Jones followed the principle in Perrett‘s Trustees v Perrett[1]: i.e. that, where both parties contribute to the purchase price of a property and the title is subject to a survivorship destination, the arrangement is contractual (and not testamentary) meaning that it is not open to either party to evacuate the destination unilaterally in a will[2]. Lord Jones also confirmed that the principle in Perrett is not restricted solely to cases in which the disposition specifically stipulates that the parties have contributed equally to the price.

Prescription
With regard to the son’s arguments on prescription, Lord Jones found that he had not demonstrated possession for a continuous period of 10 years noting that, although he lived in the property between 1992 and 1995 and claimed to have continued to have access to the property afterwards there was no specification as to when or in what circumstances the access had been taken. (It is worth noting that the court made no judgement as regards the operation of prescription on a title registered under the Land Registration (Scotland) Act 1979[3] as the parties had not provided arguments in that regard).

Acquiescence
The son’s arguments regarding mora, taciturnity and acquiescence were also rejected. Lord Jones found that the son’s title had always been open to challenge and that he had not in fact become owner of his mother’s share of the house. As such, Mr Hill could not have been said to have become aware that his son was the owner and could not be said to have delayed raising an action against his son as he had no reason to do so (until the son had raised an action of division and sale of the house in June 2015).

The full judgement is available from Scottish Courts here.

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[1] 1909 SC 522.

[2]  On the other hand, a party may be able to evacuate the destination if he or she has provided all of the funds for the property him/herself.

[3] Under the 1979 Act the operation of prescription was limited to situations where the Keeper had excluded indemnity in respect of the title. (The situation is different under Land Registration etc. (Scotland) Act 2012 which repealed the 1979 Act, however, the son’s title had been registered under the 1979 Act not the 2012 Act.)

Background
Outer House case in which William Tracey sought damages from SP Transmission in respect of overhead power cables and other equipment running through William Tracey’s site in Linwood which William Tracey argued amounted to an encroachment on the site.

William Tracey occupied the site as a tenant (of the William Tracey Private Pension Fund) from 1997 and then as the proprietor from 2006.

Prior to 1997, the site was owned by Thomas Houston & Son (Johnstone) Limited. Thomas Houston had agreed a wayleave in favour of Scottish Power plc allowing installation of the equipment on the site.  However the wayleave conferred only a personal right on Scottish Power and did not bind successor owners of the land. SP Transmission contacted William Tracey seeking to agree a wayleave in respect of the equipment in 2005 but William Tracey refused to grant the wayleave.

In December 2010 William Tracey issued a notice requiring SP to remove the equipment from the site (following a procedure contained the 1989 Act[1] which provides for the situation where ownership has changed and a wayleave is no longer binding on the landowner). Using powers available to it under the 1989 Act[2], SP then applied for a “necessary wayleave” which allows a licence holder to obtain a wayleave from the Scottish Ministers where the owner or occupier refuses to grant the wayleave voluntarily. The necessary wayleave was granted by the Scottish Ministers in August 2014.

Arguments
William Tracey argued that the necessary wayleave only had effect from August 2014 onwards and, as such, that it was entitled to damages in respect of the encroachment of the cables and equipment on its property between 1997 and August 2014.

Decision
Lord Brodie rejected that argument and dismissed William Tracey’s action. In doing so, he agreed with SP’s contention that, having regard to the wording used, the correct interpretation of the 1989 Act is that, when a change in ownership means that a wayleave ceases to be binding on an owner of land, the wayleave is nevertheless continued meaning that keeping the equipment on the property is lawful and not an encroachment. If the landowner wishes to bring that temporary state of affairs to an end, its only remedy is to give notice requiring removal of the equipment[3].  Following receipt of the notice the licence holder can then, if it requires, apply for a necessary wayleave from the Scottish Ministers (which may or may not be granted).

Lord Brodie also noted that, if William Tracey’s argument were correct, it would mean that, where landowner refuses to agree a wayleave with a licence holder, a delictual liability could be imposed on a licence holder doing no more than complying with its statutory duties. Moreover, in some cases, that liability would be unknown to, and unavoidable by, the licence holder.

The full judgement is available from Scottish Courts here.

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[1] Electricity Act 1989, sched 4, para 8 (1) and (2)

[2] Sched 4, para 6.

[3] Under para 8(2) of sched 4 and as William Tracey did.

Outer House case relating to a development at Watling Street in Motherwell which was alleged to have been built on contaminated land. The McManuses sought damages from City Link Development Company (the Developer), Scott Wilson Scotland (which the McManuses claimed had been environmental consultants on the development project) and Lanarkshire Housing Association (from whom the McManuses had leased properties on Watling Street) after suffering illness which they said had resulted from vapour given off by the contamination.

Arguments
The McManuses sought damages from City Link and Scott Wilson on the basis:

1. that their illness had been caused by the fault of City Link and Scott Wilson in terms of the common law; and
2. that City Link and Scott Wilson had breached the Environmental Protection Act 1990 (s33(1)(a)).

The McManuses also argued that the Housing Association had breached an implied term of their tenancy agreement, and were later in breach of certain provisions of the Housing (Scotland) Act 2001.

Decision
City Link
Common law fault
In terms of the common law, the McManuses argued that City Link knew or ought to have known that the property had not been properly investigated for contamination and had not ben remediated so as to be fit for residential development. However, the court found that reports produced by Scott Wilson were such that a layperson would have understood that the site was suitable for residential development. As such, City Link would only have been liable (1) if they had sufficient expertise to ascertain that Scott Wilson’s investigations had not been sufficient to determine that the site was fit for residential development or (2) if City Link owed a non-delegable duty of care (which can arise in respect of particularly hazardous operations) to the McManuses. The court found that, in the circumstances, neither applied in this case and City Link’s duty did not extend to checking Scott Wilson’s work meaning that City Link were not at fault.

Scott Wilson
Common law fault
Scott Wilson argued that it had not been employed as environmental consultants on the project and pointed to other contractors involved in the project who may have fulfilled that role. As such they argued that the McManuses’ case against them was irrelevant. However, Lord Jones found that the McManuses’ case against Scott Wilson was not bound to fail. It was noted that other contractors involved had been subordinate to Scott Wilson and that it would be possible for the McManuses to prove that it was Scott Wilson’s responsibility to investigate the contamination and to advise on the remediation necessary to make the site suitable for residential development. Further proceedings were allowed in that regard.

City Link and Scott Wilson
The 1990 Act
The MacManuses also argued that City Link and Scott Wilson had been responsible for depositing controlled waste on the site (contrary to s33(1) of the Environmental Protection Act 1990) when materials were redistributed around the site during remediation works. However, Lord Jones accepted arguments made by City Link and Scott Wilson to the effect that the works had taken place prior to the relevant provisions of the 1990 Act coming into force and could not give rise to liability under the act.

The Housing Association
The first property was held under an assured tenancy (in terms of the Housing (Scotland) Act 1987)  until September 2002 and a secure tenancy (under the Housing (Scotland) Act 2001) thereafter. The second property was also held by virtue of a secure tenancy. The court found that, in both situations, the Housing Associations obligations and duties related to the fabric of the let property itself and the McManus’s arguments which were based on the location and construction of the properties were irrelevant.

Time bar
The court also considered arguments to the effect that the McManuses case was time barred but the McManuses were given an opportunity to amend their pleadings and no decision was reached in that regard.

 The full judgement is available from Scottish Courts here.

Petition for Judicial Review in which Trump International sought to challenge the Scottish Government’s decision to grant consent for an offshore wind farm near its golf resort at Menie in Aberdeenshire. There were two main challenges to the decision.

Section 36 of the Electricity Act 1989
Trump argued that the Scottish Government should not have granted consent in terms of s36 of the Electricity Act 1989 as the wind farm developer did not hold a licence to generate electricity. Trump founded on the decision in Sustainable Shetland v The Scottish Ministers[1] in which Lady Clark found that consent to build a wind farm could not be granted to developers who did not already hold a licence to generate electricity. In the Outer House Lord Doherty disagreed with the interpretation taken in Sustainable Shetland, rejected that argument and dismissed Trump’s petition. The Inner House refused an appeal finding that the entitlement to apply for a section 36 consent is not limited to developers who already hold (or are exempt from holding) a licence to generate electricity and that, where an applicant under section 36 obtains consent, it will require to obtain a licence or an exemption before it can generate electricity at the wind farm.

The Supreme Court have again rejected Trump’s arguments in that regard finding that its proposed interpretation was not supported by the structure and language of the 1989 Act. It also found that there was nothing in the policy behind the 1989 Act requiring the Court to take a different view of the statutory provisions. In coming to this conclusion the court noted, amongst other things, that it was not a necessary part of the policy that the persons who built electricity generating stations would also be the persons responsible for generating the electricity and that it has become established practice for organisations to seek s36 consents before applying for a licence to generate electricity.

Condition 14 of the consent
Trump also argued that condition 14 of the consent granted by the Scottish Government, which provides for the submission and approval of a design statement before the development could begin, was void for uncertainty. However, the Supreme Court found that, even if that condition had been unenforceable, the consent would not have been invalidated as it was found not to be a fundamental condition determining the scope and nature of the development (this also being covered by other aspects of the consent). Further, the court noted that a planning condition can only be said to be void if it can be given no sensible or ascertainable meaning and found that that was not the case with condition 14.

As such, Trump’s appeal was dismissed.

The full judgement is available from the Supreme Court here.

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[1] [2013] CSOH 158

Background
Inner House case relating to the lease of commercial premises in Port Glasgow. @SIPP were the landlords and Insight, the tenants. @SIPP argued that, when the lease came to an end, the premises were not in good and substantial condition and a dispute arose as to the extent of the tenants repairing obligations under the lease.

The issues
There were two issues for the court to decide.

• Whether the tenants’ obligation on termination of the lease was limited to putting the premises into the condition in which they were accepted by it at the commencement of the lease.
• Whether the landlord was entitled to payment of a sum equal to the cost of putting the premises into the relevant state of repair, regardless of whether it actually intended to carry out any such work.

Outer House decision
In the Outer House Lord Tyre found in favour of the tenants on both issues holding:

•  that the obligation to keep the premises in good and substantial repair did not necessarily import an obligation to put the premises in that condition regardless of its condition at the commencement of the lease and that the tenants’ obligation was referable to the condition in which the premises were accepted at the commencement of the lease; and
• that the tenant’s obligation to make payment for the cost of the works was conditional on the landlords intending to carry out the repair works and was not as a liquidate damages provision. (Lord Tyre was persuaded that this was the interpretation which best accorded with commercial common sense as he found that very clear wording would be required before it could be concluded that a tenant had entered into an obligation to pay a sum which might bear no relation to the loss actually suffered by the landlord –in this case the estimated cost of the works required was over £1m whereas the tenant argued that, even if it had carried out all of the works, the capital value of the premises would only have increased by £175k.)

Inner House decision
The Inner House have allowed an appeal.

Putting and keeping
The repairing obligation including the following wording: (obliging the tenant)

“To accept the leased subjects in their present condition and at their own cost and expense to repair and keep in good and substantial repair and maintained, paved, heated, aired and cleansed in every respect all to the satisfaction of the Landlord and to replace or renew or rebuild whenever necessary the leased subjects and all additions thereto….. in at least as good condition as they are accepted by the Tenant all to the satisfaction of the Landlord and that regardless of the age or state of the dilapidation…”

The court came to the conclusion that the natural meaning of the clause was clear and, if the premises were not in good and substantial repair at the beginning of the lease, the tenant was required to repair them in such a way as to achieve that standard. The court took the view that the obligation “to repair” of itself was indicative of that but, if there were any doubt, previous cases support the argument that an obligation to keep property in good and substantial repair carries with it an obligation to put them in that condition[1].

In coming to that conclusion the court noted:

 “the repeated references to “the satisfaction of the landlord” not only supports the above construction and confirms that “good and substantial repair” is to be assessed by reference to the landlord’s interest in the subjects being maintained to and being delivered up in at least tenantable standard.  Further, the phrase “regardless of the age or state of dilapidation of the buildings” confirms that the tenant is not to be excused of its obligation to repair, maintain and renew etc to at least “good and substantial repair” standard by reason of them being below that standard at the commencement of the lease or, indeed, them falling below that standard during it.  The absence of a schedule or other record of condition provides further cogent support for that construction.”

Payment of sum in lieu of repairs
A further clause made provision to the effect that, at the expiry/termination of the lease, the tenant was required to carry out repairs and surrender the premises to the landlord in a state complying with the repairing obligation. However, the clause also included the following proviso:

“Provided Always that if the Landlord shall so desire at the expiry or sooner termination of the foregoing Lease they may call upon the Tenant, by notice in writing (in which event the Tenant shall be bound), to pay to the Landlord at the determination date… a sum equal to the amount required to put the leased subjects into good and substantial repair… in accordance with the obligations and conditions on the part of the Tenant herein contained in lieu of requiring the Tenant himself to carry out the work.”

The Inner House took the view that the only natural and ordinary meaning which could be given to the clause was that it was a payment clause (and not a damages clause) meaning that the sum due by the tenant did not depend on loss suffered by the landlord. Consequently, the fact that the cost of carrying out the repairs may have been disproportionately more than any increase in capital value of the premises achieved as a result was irrelevant. As such, the Inner House determined that there was no potential for interpreting the clause so as to mean that payment for the cost of the works was dependent on the landlord’s intention to carry out the works.

In coming to its conclusion, the Inner House contrasted the wording used in this case with that in Grove Investments Ltd v Cape Building Products Ltd[2] on which Lord Tyre had relied when reaching his decision in the Outer House.

The provisions in this case contained a procedure (not included in the lease in Grove) under which the Landlord made an election and served a notice on the tenant requiring the tenant to make the payment in lieu of carrying out the repairs which the court found to be significant in suggesting that the landlord’s right was to a contractual payment rather than a payment of damages.

Also, the wording used in Grove made reference to the landlord and tenant reaching a settlement based on the value of a schedule of dilapidations rather than making reference to the cost of making the repairs which the court interpreted as being analogous to a damages clause.

Ultimately the differentiating factor was that the wording in this case was interpreted as including a landlord’s right to demand a contractual payment unrelated to loss whereas the wording in Grove was not.

Some general principles
The Inner House stated:

“Care must also be taken to avoid reading anything said in Grove as being to the effect that the court can correct a bad bargain or even an unfair one; there is no general rule that a commercial contract requires to be fair”.

 And:

“it is not legitimate to re‑write parties’ agreement because it was unwise of one party to gamble on future outcomes;  the question is not whether a reasonable tenant would have entered into the obligation”

 Further:

“it is important to note that Grove did not lay down any general rule to the effect that the landlord in a commercial lease is, at termination, if repairs are outstanding only entitled to be compensated for capital loss actually suffered.”

 The full judgement is available from Scottish Courts here.

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[1] Albeit it was noted that a different conclusion may be appropriate where no obligation to renew or replace or rebuild as necessary is included.

[2][2014] CSIH 43

Supreme Court case considering the effect of a break clause contained in sub-underleases of different floors of a building known as “The Point” in London.

M&S let the property from BNP and the rent was paid quarterly in advance. When M&S exercised the break clause, the lease came to an end on 24 January 2012. M&S then brought a claim for return of the apportioned rent in respect of the period from 25 January 2012 to 24 March 2012.

There was no express term in the lease which entitled the tenant to repayment of the rent. However, M&S argued that a term should be implied into the lease.

The Supreme Court dismissed M&S’s appeal.

The Court confirmed that a term will only be implied into a contract if it satisfies the case of business necessity or is so obvious that it goes without saying.  It was noted that, although rent payable in arrears is apportionable under the Apportionment Act 1870, the 1870 Act does not apply to rent payable in advance and that common law authorities do not provide for rent (whether paid in arrears or advance) to be apportioned. The court then reached the conclusion that (aside from in very exceptional circumstances) an express term would require to be included in the lease to entitle a tenant to a refund of rent paid in advance.

Lord Neuberger said the following:

“Save in a very clear case indeed, it would be wrong to attribute to a landlord and a tenant, particularly when they have entered into a full and professionally drafted lease, an intention that the tenant should receive an apportioned part of the rent payable and paid in advance, when the non-apportionability of such rent has been so long and clearly established. Given that it is so clear that the effect of the caselaw is that rent payable and paid in advance can be retained by the landlord, save in very exceptional circumstances (eg where the contract could not work or would lead to an absurdity) express words would be needed before it would be right to imply a term to the contrary.”

The full judgement is available from the Supreme Court here.

Outer House case in which the John Muir trust sought reduction of the Scottish Ministers decision to grant consent for the construction of 67 wind turbines at Stronelairg near Fort Augustus.

Background
In their decision letter the Ministers intimated that they had decided not to hold a public local inquiry stating that they had taken into account 96 objections “and all material considerations”.  They expressed the view that there were no significant issues which had not been adequately considered “in the application, Environmental Statement and Supplementary Environmental Information, consultation responses and third-party representations” and that they had had sufficient information to be able to make an informed decision on the application without the need for a public local inquiry.

Arguments
The trust argued challenged the consent on the basis that the Ministers acted unlawfully and/or unreasonably in granting the consent:

• without the advertising of, and/or consulting on, the supplementary environmental information; and
• without giving adequate reasons for not following Scottish Natural Heritage advice (SNH having objected in principle to the wind farm on the ground of its impact on wild land).

The trust also argued that the reasons given in the decision letter for granting the consent were inadequate.

Decision
Lord Jones found that the trust’s challenge to the Ministers’ decision should succeed for the following reasons.

• A report recommending that Highland Council did not to object to the wind farm on condition that the developer make changes to the layout of the proposed wind farm was additional information which had required advertisement and/or consultation (in terms of The Electricity Works (Environmental Impact Assessment) (Scotland) Regulations 2000 and Environmental Impact Assessment Directive 2011/92/EU).
• The Ministers decision letter did not take into account SNH’s objection in principle to the wind farm (on the basis that it would have significant adverse impacts resulting in a loss of wild land and that it was not possible to mitigate those impacts).
• With regard to SNH’s objection in principle to the wind farm, the Ministers had failed to give adequate reasons for their decision in the decision letter.

The full judgement is available from Scottish Courts here.

(NB: See appeal to the Inner House here.)

Outer House case considering the extent of a repairing obligation under a lease of industrial premises in Shotts.

Background
Demi-Master were the landlords and HES, the tenants. Demi-Master sought declarator that the lease had been terminated in terms of notices of irritancy which they had served following HES’s failure to respond to notices requiring HES to comply with the repairing obligations under the lease and also to make the premises clean and tidy in terms of the repairing clause in the lease.

The repairing clause provided:

“The Tenants accept the Premises as being in such condition as shown on the attached Photographic Schedule and in all respects fit for the Tenants’ purposes and shall at their sole expense and, to the reasonable satisfaction of the Landlords, repair and maintain and renew (and, if necessary for the purposes of maintenance and repair, to replace and rebuild) and decorate and keep the Premises and all permitted additions and new buildings, if any, in like condition as is evidenced on the said Photographic Schedule and in a clean and tidy condition, clear of all rubbish, for the Duration…”

Although the repairing clause referred to a photographic schedule detailing the condition of the premises at the commencement of the lease, neither party had a copy of the schedule and it may have been that it had never existed.

Arguments
Dem-master, who were seeking a summary decree (which can be granted where, even if a defender succeeds in proving the substance of its defence, its case must fail), argued that as HES had (in terms of the repairing obligation) accepted the Premises as being “in all respects fit for the tenants’ purposes” at the date of entry, they had accepted that the Premises were in a tenantable condition at that time.

On the other hand, HES argued that, the premises were already badly dilapidated at the date of entry.  They were not wind and water tight and had not been for some years previously.  The reference to the premises being fit for the tenants’ purpose in the lease was not an acceptance that the premises were wind and watertight or otherwise in a good state of repair. HES’s use of the Premises did not require them to be wind and watertight and, in contrast to Dem-master’s assertion, the effect of the reference was to make it clear that the premises had not been wind and watertight or in a tenantable condition at the date of entry.

Decision
Lord Doherty found that he was not in a position to determine the meaning of the repairing clause without an inquiry into the material circumstances surrounding the signing of the lease and, in particular, the state of the premises at the date of entry (finding that HES were not bound to fail in their defence and he could not grant summary decree in favour of Dem-Master) and put the case out by order for a discussion as to further procedure.

The full judgement is available from Scottish Courts here.

Inner House case considering an appeal from the sheriff court. The sheriff granted an order requiring J&D Pierce to remove encroachments it had built on neighbouring land owned by the McLellans in Glengarnock.

J&D Pierce approached the McLellans in 2006 with a view to purchasing land bounding their property (in order to create additional space for their business) but were told by the McLellans on a number of occasions that the land was not for sale.  In 2012 the McLellans became aware of a boundary wall encroaching onto their property and their solicitors wrote to J&D Peirce requiring them to cease all works immediately. However, despite this, a building encroaching onto their property by 4 to 6 metres, was erected and roofed by September 2012.

J&D Pierce argued that it was inequitable in all of the circumstances to order them to remove the encroaching building. However, although the sheriff acknowledged that the law recognises an equitable power in the court to refuse to order the removal of encroachments in certain cases[1], she concluded that the company’s encroachment was not in good faith and, as such, declined to exercise that discretion in this case, noting that the effect of doing so would have been to sanction the J&D Pierce’s deliberate action in simply building the on land which they had unsuccessfully attempted to purchase in 2006.

J&D Pierce appealed on the basis that the sheriff’s order was not precise enough to identify exactly what they had to remove from the property pointing to the difficulty in identifying the exact boundaries of the property on the ground. However, the Inner House refused their appeal pointing to the fact that  the extent of the encroachments had been agreed (as being 4 to 6 metres) by the parties in a joint minute and noting that the boundaries of both properties are specified in the land certificates and that J&D Pierce had knowledge of what had been built.

 The full judgement is available from Scottish Courts here.

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[1] As summarised in the cases of Anderson v Brattisani 1978 SLT (Notes) 42. See Gordon Munro v Walter Finlayson and Catherine Finlayson and Gareth Ince and Emma Bilsland, 30th January 2015.