By John Maillie
|Published 19 March 2024
In this note we look at the recent slew of cases, some well-known and others not yet so, in which ASPIC examined what might constitute manifestly unreasonable behaviour, fraudulent representation and/or abuse of process such that the presumption of QOCS is discharged.
s.8(4) of the Civil Litigation (Expenses and Group Proceedings) (Scotland) Act 2018 (the Act) introduced QOCS into Scottish procedure, the effect of which was to depart from the previous, long-standing, rule that expenses follow success. Sheriff Principal Taylor in his “Review of Expenses and Funding of Civil Litigation in Scotland” published in 2013 had proposed the introduction of QOCS for the reason that personal injury litigation was often a battle between a well-funded insurer and a pursuer of limited means who could, the Sheriff Principal said, be discouraged from bringing a legitimate claim by the risk of an adverse expenses award.
The effect of QOCS under the Act is that the court will not make an award against the pursuer, even should the defender be successful, providing the action has been conducted in an appropriate way. There are, however, three categories of conduct set out in s.8(4) which militate against the QOCS presumption:
… a person conducts civil proceedings in an appropriate manner unless the person or the person’s legal representative—
(a) makes a fraudulent representation or otherwise acts fraudulently in connection with the claim or proceedings,
(b) behaves in a manner which is manifestly unreasonable in connection with the claim or proceedings, or
(c) otherwise, conducts the proceedings in a manner that the court considers amounts to an abuse of process.
It is worth saying that the standard of proof for a finding under s.8(4)(a) is the balance of probabilities, rather than the criminal standard.
The courts have made it clear that the fact that a claim is not particularly well-founded or that the pursuer/witnesses do not give a good account of themselves at proof is something that goes with litigation and is nothing unusual, certainly not enough to convince the court that there has been manifestly unreasonable conduct or an abuse of process by the pursuer.
Where, as in Ali or Musialowska , the court rejected the evidence of the pursuer as being incredible or completely unreliable (rather than simply mistaken) it seems more likely that the court will look favourably on applications for the discharge of QOCS.
In cases like Rowe , Carty and Harvie , where the delay and failure to observe the procedural rules was the agents' fault rather than the pursuers', the court looked so unfavourably on the procedural failures that the defenders' various applications were granted and QOCS disapplied. In other cases the court's approach perhaps appears, to a defender's eye, more borderline. We have in mind the decisions in Lennox , Anderson and Nelson here.
As ever, each case will be addressed on its individual facts and merits but there looks to be a high hurdle to overcome for a defender looking to disapply QOCS based on the provisions of s.8(4).
It is clear that the s.8(4) battleground will need to be selected carefully and, once a suitable case has been identified, careful preparation and sufficient evidence in support will be vital. Even then the outcome is by no means a foregone conclusion, as the cases below confirm.
Note: The date under each case title is the date on which the opinion/judgment was handed down.
13 December 2022
The pursuer had been shopping in premises operated by the defender. She tripped over several shopping baskets which had been stacked on the floor, fell and was injured. The proof was restricted to liability and contributory negligence. Following proof, decree of absolvitor was granted.
The defender submitted that an award of expenses should be made in its favour on the basis that the pursuer had, in bringing the case in the first place and then proceeding with it, behaved in a way that was manifestly unreasonable and/or her conduct of proceedings had been an abuse of process.
The allegations in support of the defender's claim that the pursuer had been manifestly unreasonable included that she made averments for which she could have had no basis, failed to remove these or add those which might have allowed her to make a case, failed to lead evidence in support, failed to lead a positive case and knew or ought to have known that she could not prove her case.
Sheriff Robert Fife criticised the defender’s motion in respect of both sections 8(4)(b) and (c). In respect of (b), the defender’s case seemed to rest on the premise that the pursuer’s case had no chance of success and was without merit. Bringing proceedings and continuing with them was, in the circumstances, manifestly unreasonable and/or an abuse of process.
The sheriff noted that the defender was reportedly unaware of any reported decisions from a Scottish court in which section 8 of the Act had been interpreted, defined or applied. Applying the ordinary meaning of the words led the sheriff to conclude they relate to:
“…behaviour of a manner which is clearly or unmistakably unreasonable in connection with the claim or proceedings.”
A finding by the court the pursuer is “incredible” should not, of itself, lead to a conclusion that the pursuer’s conduct has been manifestly unreasonable. There is a difference between advancing an argument which the court does not accept (as here) and advancing an argument which is bound to fail. That the pursuer was found to be unreliable and the defender’s system of inspection was reasonable were findings which meant the claim failed but that finding was not inevitable.
In respect of abuse of process, the defender contended that the pursuer did not have sufficient evidence to prove her case, made averments for which there was no evidential basis, continued the action aware that it had little chance of success and had an “improper ulterior” motive for the litigation. The sheriff rejected the argument. This was not a case where the pursuer was not credible, rather the sheriff had concluded that the defender had a reasonable system of inspection and that safety procedures had been implemented. The CCTV was open to interpretation. Overall the sheriff found that this was not a case where the pursuer had no chance or substantially no chance of success. There had been no abuse of process.
7 February 2023
The first case to deal with fraudulent misrepresentation under s.8(4)(a) of the Act.
The pursuer was working as a clinical support worker in a hospital, treating a disruptive patient who had been taken there by police officers who had to restrain him. The pursuer had been injured but exactly how was in dispute. The pursuer alleged that she had been asked by one of the officers to apply restraints to the patient and had been injured doing so.
The matter went to proof and the sheriff assoilzied the defender. He did not accept that the injury happened as the pursuer was applying the straps, did not accept that she had done so in any event or that she had been instructed or even invited to do so.
The defender sought an award of expenses on the basis that the pursuer had made fraudulent misrepresentations and her conduct had been manifestly unreasonable which, if proved, would discharge QOCS.
The defender argued that, in finding that the injury was not caused in the way alleged by the pursuer, the only logical inference was that the sheriff had found the pursuer to be incredible. Having regard to the sheriff's findings on the evidence, it was reasonable to argue that the logical conclusion was that the pursuer had lied about the whole scenario on which her claim was based.
The sheriff decided that, although there had been two competing accounts of the accident and that he had preferred the account given by the police officers, he had not made a finding that the pursuer was either incredible or that her evidence had been deliberately untrue. Given that he had not found the pursuer to be incredible but had simply preferred the police evidence, the threshold for manifestly unreasonable conduct had not been met.
Of interest is the sheriff's view that a finding of incredibility was a possible mechanism by which QOCS could be disapplied.
9 May 2023
The pursuer raised an ordinary cause action out-with the triennium. We lodged defences taking the time-bar point. The pursuer's agent did not adjust to explain the circumstances of their failure to raise proceedings timeously, nor did they seek to have the court exercise its discretion in terms of s19A of the Prescription and Limitation (Scotland)Act 1973. The pursuer's agent then compounded matters by failing to lodge a record, failing to lodge a Statement of Valuation of Claim, or indeed a list of witnesses or any productions in terms of the timetable.
We enrolled seeking dismissal due to the pursuer's various failures to comply with the court timetable, failing which we said there should be a preliminary proof on time-bar. At the same time we enrolled to have QOCS disapplied.
The sheriff having heard parties dismissed the action and also awarded the defender expenses having found that the pursuer's representatives had behaved manifestly unreasonably and in a manner that the court considered an abuse of process. To further compound matters the agent failed to pay expenses requiring the matter to proceed to taxation.
21 June 2023
The pursuer's mother died in 2018. The pursuer intended claiming against the health board in respect of the care which her mother had been given.
The pursuer's original agents requested an extension of the time-bar which was granted by the defender. The pursuer's agents ceased acting shortly after. The defender agreed a further extension after agreement with the pursuer direct. By this agreement, proceedings had to be raised by 16 November 2022 otherwise the claim would be regarded as time-barred.
A further agent was instructed a few days before the time-bar who sent an initial writ and a request for a warrant for service to the Sheriff Clerk. Three further amended initial writs were sent before service was finally effected on 12 December 2022, three weeks after the expiry of the time-bar. No motion for a sist to allow investigation or legal aid was made which is perhaps surprising as the pursuer had obtained no evidence as to liability or causation at this point.
On 12 January 2023 the CLO emailed the pursuer's agent offering to "drop hands" if the pursuer abandoned the action but no response was received. Defences were lodged on the same day together with a motion seeking decree of absolvitor with expenses being awarded to the defender because the action was time-barred, lacked specification and relevancy and the pursuer did not have title to sue. The pursuer's second agents withdrew from acting on 13 March 2023.
Summary decree was granted on 27 April 2023 by Sheriff Fife with expenses reserved. The sheriff found that the action was time-barred, that the pursuer needed to have been appointed as executrix-dative in order to pursue the action, legal aid had been refused and the pursuer had no supportive causation report.
The defender raised a motion to disapply the rules on the ground that the pursuer/her previous agent's conduct had been manifestly unreasonable or they had conducted the proceedings in such a way as to constitute an abuse of process.
The pursuer's stance as that she had a stateable case with a reasonable chance of success. The sheriff doubted whether this view was sustainable when there was no favourable report on causation over four years after The pursuer's mother's death. In addition, because the pursuer had not been appointed executrix-dative, she had no title to sue. However the sheriff found that there was no criticism to be made of the agent given the very late instructions. While it may have been unreasonable to raise the proceedings it was not manifestly unreasonable to have done so.
Given that the motion for summary decree was heard so early in the process, the agent had no opportunity to continue the proceedings when there was no chance of success and, therefore, the test for abuse of process was not met.
1 September 2023
This case lies somewhat out with the run of cases concerning the discharge of QOCS in terms of s.8(4) of the Act. The pursuer had been injured whilst helping the delivery driver to move a package into his house. He sued Screwfix as the company which supplied to goods and Royal Mail as the delivery company. Ultimately the pursuer accepted an offer from Royal Mail and abandoned his action against Screwfix.
Screwfix applied for expenses against the pursuer on the basis of OCR 31.2 which allows a party to an action to apply for an award of expenses including on the basis of abandonment of the action (OCR 31.2(d)).
The pursuer argued that only where there was evidence of inappropriate conduct of an action under s.8(4) above would QOCS be discharged and the defender be entitled to an award of expenses.
The sheriff disagreed with the pursuer. The determination of an application under OCR 31.2 was entirely at the sheriff's discretion and the pursuer's submission that such discretion had to be consistent with QOCS principles was unsound. The pursuer had abandoned his claim against Screwfix and, pursuant to OCR 23.1.2, the defender must be awarded expenses.
16 October 2023
The case arose out of a road accident. The case settled but the defender enrolled a motion to limit the recoverable expenses and also for an award of expenses against the pursuer on the following grounds:
The sheriff's view was that the pursuer's agents had not managed the action satisfactorily: there was a failure to reply to correspondence form the defender's agents, a failure to adhere to the court timetable and some of the expert evidence had been provided late, among other failings. However, the sheriff said, he was unable to be certain that, even had the material been provided in a timely way, the claim would have settled before proceedings were raised and he would not therefore award expenses on the PAP scale.
The action did not amount to an abuse of process because there was some basis for the pursuer's approach to valuation. However, in view of the persistent failures to comply with the timetable or to engage with the defender's agents, he was satisfied that the pursuer's agent's conduct had been manifestly unreasonable, consequently disapplied QOCS and awarded expenses to the defender.
16 October 2023
This case also arose after a road accident. The defender had been granted decree of absolvitor at the proof and the question of expenses came before the sheriff a few months later. The defender had enrolled a motion for a finding that the pursuer's conduct had been manifestly unreasonable and QOCS should therefore be disapplied.
The sheriff considered that the pursuer's account of the accident in which she was a passenger was in line with her pled case. Her husband's account, as the driver, differed in some important respects. The sheriff found the husband to have been an unreliable witness and ultimately declined to place any weight on what he said. In addition he was not certain that the pursuer was a reliable witness either. She suffered from narcolepsy. Her husband said the condition made the pursuer forgetful but the pursuer herself said she had a very clear recollection of the accident. No evidence was led from an expert on narcolepsy. Her recollection of where her husband and the defender were after the accident was unclear. The sheriff accepted the defender's evidence and the action failed accordingly.
All of this, however, did not mean that the pursuer's conduct was manifestly unreasonable using the definition set out by Sheriff Fife in Lennox . The pursuer's own evidence was not of itself incredible notwithstanding the sheriff's concerns re its reliability. On this basis the sheriff refused the defender's motion and did not discharge QOCS.
30 October 2023
This case again involved a road accident in relatively unusual circumstances. The pursuers had been sitting in a stationary vehicle when it was struck by a van driven by the defender's insured. Liability for the accident was admitted but the matter went to proof on the question whether the pursuers had really suffered an injury or not.
The defender was granted decree of absolvitor and lodged applications against both pursuers for expenses on the grounds of fraudulent misrepresentation and manifestly unreasonable conduct.
The sheriff said that, having had the opportunity to see and hear the evidence of both pursuers, he had concluded that neither could be regarded as either credible or reliable. The evidence from both of them on the effect of the impact both in terms of what happened to the car they were in, their subsequent alleged injuries and an account by the first pursuer of the movements of the van up to the point of impact which he later disavowed in court notwithstanding it had been signed by him as being true to the best of his knowledge information and belief. This, in the sheriff's view, went far beyond the common scenario where there are competing versions of events and the court prefers one version over the other.
On balance the sheriff was satisfied that that both pursuers acted intentionally to mislead the court and the threshold for section 8(4)(a) had been met, as had that for manifestly unreasonable conduct under s.8(4)(b). QOCS was disapplied and an award of expenses made against each pursuer.
30 October 2023
The issues in this matter arise out of yet another road accident. In this case it was admitted that there had been a collision between the defender's car and another in which the pursuer had been a passenger. Arguments similar to those raised by the defender in Ali above were raised here and the matter went to proof on the questions whether any injury had been suffered at all and the circumstances in which the collision had occurred in the first place.
The defender enrolled a motion seeking, among other things, a ruling that there had been fraudulent misrepresentation (s.8(4)(a)) and manifestly unreasonable conduct (s.8(4)(b)) by the pursuer.
The sheriff decided that neither the pursuer nor her witness had given credible or reliable evidence at the proof. The evidence they had given as to the way in which the impact had taken place and the mechanics of the resulting impact between the vehicles did not stand up to scrutiny. Even accepting that damage had been caused by the defender's vehicle, the damage seen in the available photos did not match either any damage to the defender's car or with the alleged single or double collision between it and the pursuer's car. The pursuer alleged that photos had been taken of the damage immediately after the accident but these phots had not been lodge in process and neither was there a convincing explanation for their absence. The pursuer alleged that the defender's car had been tampered with or repaired post-accident but the sheriff rejected this allegation.
Evidence relating to absences from work caused by the injuries and discrepancies regarding when she had actually instructed her solicitor did not help her cause.
In words which are identical to those used by the sheriff in Ali , Sheriff Douglas Keir in this case said that the significant issues with the pursuer's evidence went far beyond the more common scenario where there are competing versions of events and the court has preferred one version over another.
QOCS was discharged and the defender awarded the expenses of the action and the motion.
7 November 2023
The action in this claim so far as our interest in QOCS is concerned centred around the pursuer and third defender (American) which had been erroneously recorded as the motor insurer by the MID. The pursuer latched on to this and it caused a certain amount of tunnel vision. The pursuer eventually brought the third defender into the action despite having been told a long time before that it was the incorrect insurer and details of the correct insurer having been confirmed.
The pursuer refused to drop the action against American on the basis that the first and second defender had not confirmed liability and the pursuer would be moving for summary decree against them after the record closed. In response American confirmed that this was irrelevant because the pursuer had sued the wrong insurer.
Ultimately the pursuer indicated that it would release American because admissions of liability had been received from the first and second defenders. American confirmed that it would be seeking expenses from the pursuer.
The sheriff confirmed that, as the pursuer was in effect abandoning his claim against American, the question for the court was whether its discretion to remove QOCS protection should be exercised. Overall, the sheriff was satisfied that the lack of action taken by the pursuer's agent to investigate the position was clearly consistent with "behaviour that was manifestly unreasonable" . There was a gap of almost four months from the time that the correct insurer's details were passed to the pursuer's agent and the date proceedings were served. The sheriff thought that it might have taken around two months from the investigation being started to the point at which a response was received from the correct insurer, which would have taken matters to the start of October 2022.
Overall, the sheriff was satisfied that American was entitled to an award of expenses against the pursuer from 1 October 2022, with his discretion being exercised in favour of the pursuer for expenses incurred before that date.
14 November 2023
The pursuer had been successful in a claim for damages for personal injury and the matter was before the sheriff for decree in terms of a Minute of Tender and Minute of Acceptance, certification of a skilled witness, and an application for sanction for the employment of junior counsel. The defender made a countermotion for expenses from the date of tender.
The defender's position was that the pursuer should be awarded its expenses to the date of tender and the defender from that date to the present. This was based on the fact that the pursuer had delayed acceptance of the tender for five months and, had it obtained an report form another expert instead of the one first instructed who had a long waiting list, the matter would have resolved much more quickly.
The sheriff described the length of time taken by the pursuer to obtain the expert report as "sub-optimal" but, in the circumstances, regarded the explanation given by the pursuer as reasonable. There was no wilful failure or other unreasonable conduct. While the delay was lengthy it was not unreasonable and the defender's motion failed.
21 November 2023
This is a slightly different case in that the operation of s8(4)(b) was not at the centre of the arguments: here, as in McRae above, the disapplication of QOCS turned on abandonment of the action against one of the defenders and an award of expenses against the pursuer based on a failure to observe the provisions of the CPAP.
After settlement had been agreed, the pursuer had enrolled a motion seeking:
The third defender lodged a motion in turn in which it sought to have QOCS disapplied because the pursuer had abandoned his claim against it; it further sought an award of expenses against the pursuer.
The pursuer argued that the first defender had maintained throughout that the accident was the third defender's fault and that the pursuer was entitled to seek a probation. The third defender responded that because the pursuer had abandoned the case against it OCR 31A.2(2)(d) operated. The third defender also applied for an award of expenses against the pursuer on the basis that the provisions of the CPAP had been breached pursuant to OCR 3A.3. The third defender pointed out that neither the first nor second defenders had alleged there was any fault on the third defender's part.
The court said that the pursuer had to diligently investigate liability before litigation to establish who was probably liable for damages. If those investigations were not timeously carried out or not carried out at all and there was simple reliance on conflicting information which led to multiple defenders being sued, a pursuer could not expect the court to exercise its discretion not to disapply QOCS when he abandoned the action against one or more defenders. In fact the court did not consider that the first defender had induced the pursuer to convene the third defender into the proceedings or that there was any basis for it to exercise its discretion not to disapply the QOCS rule on abandonment.
The court granted the pursuer's motion and also the third defender's in terms of OCR 31A.2(2)(d) and made an award of expenses against the pursuer in favour of the third defender.
24 November 2023
The ASPIC refused a motion by the defender in a tripping case for an order for expenses to be awarded in its favour following decree of absolvitor being pronounced at proof.
The defender sought to disapply the rule under s 8(2) on the basis set out in s 8(4)(b), i.e. that the pursuer or his legal representatives had behaved in a manner which was manifestly unreasonable in connection with the claim or proceedings.
The court was not satisfied that there was any basis for suggesting that the pursuers' averments should never have been made, nor that there had been any failure to review prospects in the lead up to the proof which ought to have led to abandonment. The fact that the court did not find the pursuer's evidence sufficiently reliable to then make a finding that the defender was liable to pay him damages did not mean that the pursuer's agent was behaving in a manner which was manifestly unreasonable. The court accepted that there was a failure to lead evidence at proof on an aspect of the pursuer's case but that did not come near the threshold needed for s 8(4)(b). Agents regularly made mistakes: where the mistakes were innocent, even careless, resulting from the pressures an agent was under during the conduct of a proof they should not be viewed as constituting behaviour which was manifestly unreasonable.
1 December 2023
The pursuer successfully argued that a ball had been thrown at and had hit him whilst at work. Liability was found for him but causation was thrown out because the sheriff found that the incident had not caused the pursuer's right-sided deafness. The pursuer had first been aware of this upon waking on the morning of the day in question i.e. before he had gone to work.
The sheriff accordingly had assoilzied the defender which then applied for the expenses of the action under s.8(4)(a) and (b) – fraudulent representation and manifestly unreasonable conduct.
The sheriff found against the defender on both grounds:
The "contradictory causal mechanism" the sheriff refers to arose from of a GP note and referral letter both of which indicated that the pursuer had suffered spontaneous hearing loss on the day of the accident, contradicting his assertion that this was caused by the ball hitting him later on. The pursuer said the GP must have misheard or misunderstood him. We leave it to you to consider whether this was a "contradictory causal mechanism" or an attempt by the pursuer to pull the wool over the court's eyes.
March 2024
The pursuer was injured when a partition fell over and hit him. CCG was the main contractor, but the partition fell because of the actions of an employee of joiners working on site. The pursuer intimated a claim against both firms. CCG denied liability and identified the joiners as culpable. The pursuer raised against both, but eventually settled with the joiners alone and sought decree of absolvitor in favour of CCG (!) arguing that the claim against CCG was not being abandoned but, rather, that he could not proceed further with it due settlement with the joiners (!!).
At the expenses hearing, the sheriff awarded no expenses due to or by the pursuer and CCG. CCG appealed, arguing that where two or more defenders are sued, the pursuer must pay the expenses of the defender absolved of blame, unless the court decided that QOCS should stay in place for whatever reason. In this case the pursuer had chosen to end proceedings against CCG and as such this constituted abandonment. In addition the lack of a formal minute having been lodged made no difference: this was abandonment under common law. Ultimately the pursuer conceded the appeal in full before the actual hearing and CCG was awarded its expenses of the hearing and appeal by the Sheriff Principal.
