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EXTRA DIVISION, INNER HOUSE, COURT OF SESSION

Lord Bonomy

Lord Woolman

Lord Marnoch

[2011] CSIH 69

OPINION OF LORD BONOMY

in Reclaiming Motions

in causa

JOHN HUMPHRIES PARKES

Pursuer and Reclaimer;

against

(FIRST) ROBIN MACGREGOR AND (SECOND) CINTEC INTERNATIONAL LIMITED

Defenders and Respondents:

and

JOHN HUMPRHIES PARKES

Petitioner and Reclaimer

against

CINTEC INTERNATIONAL LIMITED

Respondents

_______

Pursuer & Reclaimer & Petitioner & Reclaimer: Party

For First Defender & Respondent: D Thomson; Harper Macleod

For Second Defenders and Respondents: Mackenzie, Solicitor Advocate; Shepherd & Wedderburn

11 November 2011

Background


[1] Reclaiming motions at the instance of Mr Parkes against the decision of Lady Paton to dismiss his action to reduce his sequestration - John Humphries Parkes v Robin MacGregor & Cintec International Limited [2008] CSOH 43 - and the decision of
Lord Brodie to dismiss his petition to set aside the registration of a certificate of money provisions in terms of paragraph 10 of Schedule 6 to the Civil Jurisdiction and Judgments Act 1982 ("the 1982 Act") - John Humphries Parkes v Cintec International Limited [2010] CSOH 38 - were heard together.


[2] Lady Paton dismissed the action because the summons did not contain relevant averments of exceptional circumstances sufficient to support the conclusion for reduction. She also expressed the view that, since the sequestration proceeded upon a prima facie valid certificate relating to an English order for costs, registered in Scotland in terms of Schedule 6 of the 1982 Act, the Court of Session could not go behind that order unless or until it was reduced, and any action seeking reduction of the English decree would require to be raised in England. Following that decision the reclaimer endeavoured to challenge the certificate before the English High Court. That application was refused in 2009, as was the reclaimer's application to the Court of Appeal for leave to appeal. Following refusal of the application for leave to appeal in
England, the reclaimer presented the petition (to set aside the registration of the certificate), which is the subject matter of the second reclaiming motion. That also was dismissed as irrelevant.


[3] In addition to oral submissions from Mr Parkes and from Mr Thomson for the first respondent and Mr Mackenzie for the second respondents, the court had extensive written submissions from Mr Parkes and a note of argument for the first respondents and two notes of argument, one in relation to each case, from the second respondents. In the action a document No.45 of process headed "Introduction and History", which sets out detailed arguments for the reclaimer in support of 18 grounds of appeal, was supplemented in the course of the hearing by two further written submissions from him, one entitled "Appendix Lady Paton Reclaim" comprising sections A-N, some repetitive of earlier submissions, supported by reference to authority, the other entitled "Bullet Points" setting out nine submissions, again supported by reference to authority. In the petition his grounds of appeal contained detailed submissions. A further five page written submission was presented in support of the challenge to an earlier interlocutor of Temporary Lord Ordinary Wise. In the course of the summar roll hearing the reclaimer presented additional extensive written submissions supported by reference to authority in a document headed "Appendix List". in which he set out further submissions. Another document presented by the reclaimer, headed "Bar Pleadings", provided background material and further submissions.

[4] While that sets the two reclaiming motions in context, it is appropriate to outline a little more of the historical background to the litigation. The summons for reduction, the subject of the first reclaiming motion, initially came before the Court on 10 December 2004 in respect of a motion for interim interdict against the first respondent which was refused. On 22 December 2004 the motion of the second respondents to be sisted as defenders in the action was granted. Thereafter both respondents failed to enter appearance. On 28 September 2005 decree in absence was granted, reducing the award of sequestration. The respondents then initiated a reponing procedure, which resulted in the decree in absence being recalled on 7 October 2005. The action proceeded and was ultimately dismissed by Lady Paton as indicated in paragraph [1] above. On 22 June 2004 a first order had been granted in an earlier petition at the instance of the reclaimer for recall of his sequestration. There was a delay in the service of that petition. Thereafter the petition proceeded coincidentally with, but separately from, the summons. On 26 July 2005, following a procedure roll debate, it also was dismissed as irrelevant. The reclaimer reclaimed that decision. However, when the matter came before the Inner House on 30 November 2005, he no longer insisted upon that reclaiming motion and it was refused for want of insistence. It is not entirely clear why the reclaimer did not insist upon that reclaiming motion, but it is possible that he was under the mistaken impression that the award of sequestration remained reduced whereas the decree of reduction pronounced in absence had in fact been recalled on 7 October 2005.

Reclaiming Motion in the Petition


[5] Although this litigation has involved a number of separate processes in
England and Scotland, the core issue is the status of the certificate on which the sequestration proceeded. Having failed in his challenge to the validity of the certificate before the High Court in England, the reclaimer turned his attention to having the registration of the certificate in Scotland set aside on the ground that it proceeded on an invalid certificate. Were the reclaimer to be successful in having registration of the certificate in Scotland set aside, he could then endeavour to have his sequestration reduced. His contention would be that these amounted to exceptional circumstances in which reduction of the sequestration would be appropriate. Before us the debate centred upon the validity of the certificate, and was concentrated upon the reclaiming motion in the petition.

(i) Registration and Extract of Certificate of Money Provisions


[6] The sequestration of the petitioner followed upon a costs order made by the Chancery Division of the High Court of Justice in
England on 16 October 2003. The respondents Cintec were judgment creditor. The order was made of consent of the petitioner and his then co-defendant Martin Frost. It followed the judgment of Laddie J set out in Cintec International Limited v John Humphries Parkes (t/a Dell Explosives) and Martin Frost [2003] EWHC 2328 (Ch). The order was a final order in respect of which provision is made in Schedule 6 to the 1982 Act for enforcement in Scotland. That involved Cintec applying to the proper officer of the High Court in England for a certificate of money provisions in the prescribed form. The certificate issued was then presented to the Keeper of the Registers of Scotland for registration. The application process is regulated by Rule of the Court of Session ("RCS") 62.37(1). Once registered the certificate became the equivalent of a Court of Session decree, and on the strength of an extract thereof the petitioner was sequestrated.


[7] The certificate in the form originally issued by the High Court is 6/5 of the petition process. When first presented to the Keeper for registration, the certificate did not include the reclaimer's address or that of Mr Frost. It is not entirely clear whether agents acting for Cintec made informal inquiry about whether the certificate would be registered in that form and were told that it would not, or whether they presented it and it was rejected. Whatever be the case, those agents altered the certificate by adding the reclaimer's address and that of Mr Frost. The certificate in that form was presented to the Keeper and registered. It is No.6/6 of the petition process.


[8] The reclaimer contends that presentation of this document for registration amounted to fraudulent uttering of a sealed order of the English High Court. He maintains that Cintec obtained registration of the certificate by fraud; the certificate should therefore be reduced, thus enabling the reclaimer to have the award of sequestration reduced.


[9] Paragraph 10 of Schedule 6 to the 1982 Act provides not for "reduction" but for "setting aside" of the registration, if the Court "is satisfied that the registration was contrary to the provisions of this Schedule". That is what the reclaimer in effect seeks. Thus the issue comes to be one of statutory interpretation. In spite of some of the flowery language of the reclaimer's pleadings and written submissions alleging falsification of a document, the reclaimer does not suggest that anything inaccurate or misleading was written on the certificate. He accepts that the information added was accurate, but maintains that to add anything at all, even the entirely accurate designation of a party, to a formal court document and present it for registration amounts to uttering of a false document. However, what he had to do was demonstrate that the registration of the document following its alteration was "contrary to the provisions" of Schedule 6 of the 1982 Act.


[10] Since the courts of the jurisdiction where the order for payment was made, England and Wales, were satisfied that Cintec were entitled to apply for a certificate and that the certificate had been validly issued in terms of paragraphs 2, 3, and 4 of Schedule 6, the issue boiled down to whether Cintec had failed to comply with paragraph 5. It is in these terms:

"5(1) Where a certificate has been issued under this Schedule in any part of the United Kingdom, any interested party may, within six months from the date of its issue, apply in the prescribed manner to the proper officer of the superior court in any other part of the United Kingdom for the certificate to be registered in that court.

(2) In this paragraph 'superior court' means, in relation to England and Wales or Northern Ireland, the High Court and, in relation to Scotland, the Court of Session.

(3) Where an application is duly made under this paragraph to the proper officer of a superior court, he shall register the certificate in that court in the prescribed manner".


[11] The "prescribed manner" in terms of paragraph 5(1) is that set out in RCS 62.37 which is in the following terms:

"62.37 (1) An application under paragraph 5 of Schedule 6 to the Act of 1982 (application for registration in the Court of Session of a certificate in relation to a money provision in a judgment from another part of the United Kingdom) shall be made by presenting to the Keeper of the Registers -

(a) a certificate under paragraph 4(1) of Schedule 6 to the Act of 1982; and

(b) any certificate of currency conversion under rule 62.2(1)(b).

(2) On presentation of the certificate mentioned in paragraph (1)(a), the Keeper of the Registers shall -

(a) register the certificate in the register of judgments of the Books of Council and Session; and

(b) issue an extract of the certificate with a warrant for execution".

Paragraph 4(1) of Schedule 6 is in these terms:

"4(1) Subject to paragraph 3, on an application under paragraph 2 the proper officer shall issue to the applicant a certificate in the prescribed form -

(a) stating the sum or aggregate of the sums (including any costs or expenses) payable under the money provisions contained in the judgment, the rate of interest, if any, payable thereon and the date or time from which any such interest began to accrue;

(b) stating that the conditions specified in paragraph 3(a) and (b) are satisfied in relation to the judgment; and

(c) containing such other particulars as may be prescribed".

The provisions of paragraph 3 have no direct bearing on the point in issue.

That is all that is prescribed. In the event that subparagraph (1) of RCS 62.37 is complied with, then the Keeper is obliged to register the certificate in the Register of Judgments of the Books of Council and Session and issue an extract with a warrant for execution.


[12] The Lord Ordinary approached the question whether the registration should be set aside with two principles in mind: firstly, that the exercise of powers in sequestration must be strictly in accordance with the law, that is exactly in accordance with their prescribed terms (Joel v Gill (1859) 22D 6); and secondly, that no one should be allowed to benefit from his own fraud.


[13] In interpreting events in accordance with the first principle the Lord Ordinary noted that neither Schedule 6 nor the relevant provision in the English Civil Procedure Rules ("CPR") 74 demands the inclusion of the address of the judgment debtor in the certificate. It is sufficient, according to CPR 74.4, that the address should be stated in the application for the certificate, if known. He then concluded that a certificate in the form of 6/5 was sufficient and that, interpreting events strictly, the addresses added later did not form part of the document which bore to be certified by the Chancery Master. From the perspective of the certifying officer that is correct. However, when the matter is addressed from the perspective of the circumstances as they were in
Scotland, it is not as simple as that. What was presented to the Keeper, registered, and then extracted was the certificate under Schedule 6 of the Act with material, which should normally form part of the application for the certificate, and be reflected in the certificate, added to it.


[14] Having regard, however, to the fact that what was added was apparently of no materiality, since the address does not appear to be a requirement of registration, I was concerned that the Court had not been as fully addressed on the significance of alterations to decrees and extracts as was appropriate in the circumstances. I was not alone. The Court therefore appointed the cause to call By Order to enable parties to make further submissions on that matter.


[15] Mr Mackenzie and Mr Thomson both lodged helpful written submissions and supplemented these briefly before the Court. Mr Parkes presented his written response in two documents and also made brief further oral submissions. He acknowledged that the addresses were included in the English judgement.


[16] While the circumstances in which those acting for Cintec came to add the addresses of Messrs Parkes and Frost to the certificate remain controversial, it is clear that they did make these additions, that they were patent, and that in the full knowledge that these additions had been made the certificate was officially registered and extracted. The aspect of these events that I have found most troubling is that a party to the dispute was responsible for altering the certificate. That is an apparently unique feature of this case not reflected in any other to which we were referred. On the other hand the additions made to the certificate were informal notations until given formal effect by the actions of an official in the office of the Keeper. The circumstances can, therefore, be seen to be comparable to those of other cases where officials have made alterations to court documents.


[17] In inviting parties to make further submissions the Court drew attention to two passages in MacLaren, Court of Session Practice, which are to be found at pages 1103 and 1105, which are in the following terms respectively:

"Where the materials are found in the process for the correction of an error in a decree, the Extractor himself may put the matter right in the extract."

"It is also a good ground of objection that the extract does not conform to the decree..."

Taking these two passages together and considering the authorities cited in the footnotes to support them along with the submissions made to us, it appears to be a matter of circumstances whether an error in a decree may be corrected.


[18] In
Henderson v Cullen (1860) 22D 712 the Lord Justice Clerk (Inglis) stated it to be the duty of the extractor, in extracting the decree, to "remedy the blunder" when a decree was pronounced against "the defenders" although the summons was served on only one defender following the death of the other. In Clark and Macdonald v Bain (1895) 23 R 102 the clerk amended a decree from £14 to £41 but did not have it authenticated by the judge. The Court considered that omission did not introduce any vice into the interlocutor because "in point of fact, it accords with the judgment of this Court." Lord McLaren was of the view that, since the interlocutor as revised truly expressed the judgment of the court it was unnecessary that any formal correction should be made. In contrast to these cases, in Dingwall v Gardiner (1825) 4 S 246 and McPherson v Wright (1885) 12 R 942 controversial alterations, which in the first case increased the amount actually awarded in the decree and in the second related to a conflict between the date of protest of a Bill of Exchange marked on the Bill and the date shown on the extended protest, were held to be ineffective.


[19] Mr Mackenzie helpfully drew our attention to certain later authorities. He referred to the following passage in the Stair Memorial Encyclopaedia, Civil Procedure, at paragraph 313:

"If there is an error in an extract then the court can be petitioned to correct it. Otherwise a faulty extract may require to be reduced on the grounds of non-conformity to the decree".

That passage is of itself of little assistance since the issue facing us is alteration without court authority. However one of the cases cited as support for that proposition does help. In McKellar v Dallas 1928 SC 503 a decree of declarator was pronounced, but the extract ordained specific implement. The extractor had read the opinion in the case in order to construe the interlocutor. The matter came before the court in an application to suspend a charge following upon the extract decree. At first instance the charge was suspended by application of the rule that in all forms of diligence at every stage there must be strict conformity to the original warrants. A reclaiming motion was allowed on the ground that the extract correctly represented the decree and gave effect to the judgment expressed in the opinion issued. In his opinion the Lord Justice Clerk (Alness) said this:

"McKellar's argument accordingly involves that the terms of the Lord Ordinary's interlocutor frustrate the terms of his opinion. I should be slow to reach so whimsical a result. McKellar's counsel argued that, in construing the interlocutor, the extractor was not entitled to look at the terms of the Lord Ordinary's opinion. Perhaps he was not. But we are. And I confess that to hold, as we are invited by McKellar to do so, that the interlocutor, in so far as it purports to deal with the second conclusion, is meaningless and inoperative - for that is the only alternative open to us - seems to me so repugnant to good sense that I should hesitate so to hold unless driven to it by reasoning which is irrefragable"

Lord Anderson added at page 524:

"If the Lord Ordinary's (Constable) view as to the meaning of the interlocutor is correct, then the only result of the protracted litigation undertaken by the reclaimers is that they have obtained what was suggested during the debate to be 'a pious expression of opinion' on the part of the Lord Ordinary. This seems to me to be a ridiculous conclusion to reach. I am of opinion that the extract decree, which I regard as an interim and not a final decree, correctly expresses what is contained in the interlocutor of the Lord Ordinary."


[20] What I conclude from these authorities is that a minor alteration to a decree made for the purpose of clarifying the order of the court and which reflects the substance of that order does not necessarily render the extracted document invalid or unenforceable. It will always be a matter of circumstances. In relation to diligence, which of course may be a step along the way to sequestration, the requirement of strict adherence to the requirements of the rules inevitably means that the circumstances in which an alteration to a formal document will not vitiate the process will be limited.


[21] In the present case it is, in my opinion, significant that the alteration involved is the addition of the accurate addresses of the reclaimer and his erstwhile co-defendant, Frost. The address added in respect of the reclaimer was his address at the time of the proceedings in
England and remains his address. Those addresses appear also to have been included in the judgment that the certificate had been secured to enforce. However, my opinion does not depend upon that being the case. Before the registration of a certificate can be set aside by the Court in terms of paragraph 10 of Schedule 6, the registration must be shown to be contrary to the provisions of that Schedule. In my opinion the facts of this case do not warrant the conclusion that the registration was contrary to the provisions of the Schedule. The undoubted irregularity that the accurate addresses were added to the certificate by the party seeking to take advantage of it, after the certificate was issued and before it was registered, does not justify that conclusion, having regard to the nature of the additions made. The substance of the certificate was not altered and, although the addresses might have been of passing convenience to those enforcing the ultimate warrant, it was not suggested that they were essential to that process. There is most certainly nothing in the material before the court to suggest that any element of fraud or dishonesty was involved in securing the registration.


[22] The Lord Ordinary placed significant reliance on the decision in King v Crieghton [1841] 4 D 62, and the opinions of Lords Medwyn and Moncrieff, as support for his view that the addition of the addresses was "neither here nor there". In my opinion the circumstances of that case are so far removed from the present that I do not find it to be of assistance in determining this issue. The facts were more akin to those in the proceedings in the present matter before Master Bragge when he took the view that the certificate issued in
England remained a certificate under Schedule 6 of the 1982 Act in spite of the addition of the addresses. The subsequent registration in Scotland adds an additional dimension which distinguishes both the decision of Master Bragge and the circumstances in King.


[23] It is perhaps significant that parties were not able to identify any more recent authority dealing with a similar issue. That suggests that the circumstances in which informal alteration of a court order, other than in accordance with rules of procedure, will not vitiate further procedure following thereon and will be given effect by the court are extremely limited. The purposes of a scheme such as that set out in Schedule 6 are designed to ensure that the background circumstances of a court order made in one jurisdiction do not require to be reinvestigated in the jurisdiction where enforcement is sought. It is plain that, in general, therefore, strict compliance with the scheme is required and nothing we have said in this opinion should be taken to suggest otherwise. All that said, in the particular circumstances of this case, and for the reasons set out above, I would reject ground of appeal 4 in the petition, which emerged as the crux of the reclaimer's case and the most controversial ground of appeal. However the matter does not end there.

(ii) Judicial Bias


[24] While the reclaiming motion was pending, the reclaimer was given leave to introduce an additional ground of appeal based on this proposition:-

"...the Temporary Lord Ordinary is a partner in Core Mediation Services (joined the same in September 2008) said company also having within its partnership a senior member of the respondents legal firm of record namely Shepherd and Wedderburn".

The reclaimer sought to challenge the interlocutor pronounced in the petition by Temporary Lord Ordinary Wise on 18 December 2009 allowing Cintec's answers to the petition to be received, allowing adjustment of the petition and answers and appointing a hearing thereon. The reclaimer's contention was that the role of the Temporary Lord Ordinary in Core Mediation Services and her professional relationship in that role with a senior member of the respondents' solicitors made it inappropriate for her to preside, firstly because any informed observer would consider there was a risk of bias and secondly because it led to actual bias in that she gave the reclaimer's case favourable treatment. There had been a dispute between the second respondents' solicitors and the Court's General Department, where documents are lodged, as to whether Cintec's answers were lodged there timeously and mislaid or were in fact lodged three weeks late.


[25] It is plain from the report by the Temporary Lord Ordinary that this argument is without foundation and should never have been advanced. She is not a partner in Core Mediation Services. She is one of a number of independent mediators (some legally qualified, some not) who are on a panel from which parties instructing Core Solutions Group may select mediators. All have primary work commitments that have nothing to do with Core Solutions Group. It is a limited company of which the Temporary Lord Ordinary is neither a director nor a shareholder. She has never held any post of any kind within the organisation. The Temporary Lord Ordinary advises us that in her independent role as a mediator she has never worked with the solicitor referred to. She advises us further that in her professional work as a practising Queen's Counsel she does not, and did not at the material time, receive instructions from the firm in which he was a partner. On these facts there is no basis on which any informed observer acting reasonably could possibly consider that there was a risk of bias.


[26] So far as actual bias is concerned, I can see nothing in the circumstances of the hearing and the decision reached that hints at unfair treatment of the reclaimer. The answers were tendered to the Lord Ordinary a short period after the due date for lodging. Whether the answers were mislaid in the court office or were not lodged timeously, it is in my opinion highly unlikely that any Lord Ordinary faced with the same situation would not have allowed the answers to be received, since it is difficult to see that in the overall context of this litigation the reclaimer could be prejudiced by that and there was a clear risk otherwise of prejudice to Cintec through their exclusion from the process. The decision was one for the presiding Temporary Lord Ordinary to make in the exercise of her discretion on the material presented to her. The determination she made was a perfectly reasonable one in all the circumstances.


[27] The reclaimer sought support for his challenge to the role of the Temporary Lord Ordinary in guidelines issued by the Lord President identifying cases in which temporary judges should not sit, including those of "particular public interest". While it is understandable that the reclaimer considers his case to be of particular public interest, I can see no basis for describing it as such, and certainly no basis for describing the proceedings and issues addressed by the Temporary Lord Ordinary in December 2009 at a procedural calling as such. Her involvement did not infringe the guidelines.

(iii)_ The Remaining Grounds of Appeal Relating to the Petition


[28] I deal now with the remainder of the original thirteen grounds of appeal in the reclaiming motion relating to the petition. The reclaimer's case, like so many before this Court conducted by litigants rather than lawyers, includes many grounds of appeal, some relating to the points discussed so far, but a number relating to other issues. They are expressed in a series of written submissions that in many places seem designed to conceal rather than elucidate the point that is sought to be made. The danger of unduly prolix submissions by litigants, naturally immersed in the complexities of the case and the emotional turmoil that it has generated for them, is that good points may not be highlighted and may go unnoticed, drowned in a morass of sludge. The reasons why none found favour with me may be brief, but the time devoted to ensuring that no point of substance is overlooked has been considerable.


[29] I have already given my reasons for rejecting ground
4 in arriving at my opinion that the registration of the certificate was not contrary to the provisions of Schedule 6 of the 1982 Act. In doing so I took account of the arguments presented in support of grounds 8, 9, 10 and 11. Grounds 1, 2, 6 and 7 display a lack of understanding of the approach that the court adopts to questions of relevancy. The reclaimer's pleadings were addressed on the assumption that they are accurate. Grounds 3, 12 and 13 relate to the way in which Cintec's agents conducted the proceedings. While the reclaimer asserts prejudice and breach of rights "under the Human Rights Act and EC Articles", he fails to specify any unfairness or adverse consequence, such as that he was prevented from tendering material or making relevant submissions or saying all that he wished to say. In ground 5 the reclaimer maintains that the Lord Ordinary failed to take proper cognisance of authorities presented. I consider that the Lord Ordinary had regard to all relevant authorities cited. In none of these grounds is a separate point of substance made that provides a basis for successfully challenging the Lord Ordinary's judgment.

Reclaiming Motion in the Action


[30] I now turn to address the reclaiming motion in the action. The principal reason given by Lady Paton for dismissing the action was that reduction of an award of sequestration may be granted only in exceptional circumstances and the reclaimer's pleadings did not contain averments of such exceptional circumstances as would justify reduction. The sequestration proceeded upon the extract certificate granted under Schedule 6 of the 1982 Act, which has the force of an extract decree of the Court of Session. The normal process of serving a charge followed and, when payment was not made within the days of the charge, the sequestration process took its ordinary course. Much of the focus of the reclaimer's averments in the action was upon events subject to the jurisdiction of the English courts which led to the costs order being pronounced and the certificate granted. At the time of the procedure roll debate in the action the reclaimer's attention was not directed towards the remedy provided in paragraph 10 of Schedule 6. The certificate granted in England was then, as it remains in light of your Lordships' decision on the petition, prima facie valid. His attempts there to challenge the certificate were unsuccessful. As was pointed out on behalf of the first respondent, the reclaimer's pleadings do contain averments that the Court in
England was misled in relation to the merits of the action determined there and also in relation to various steps of procedure, and that such averments could conceivably constitute exceptional circumstances. However what is required for an action of reduction to succeed here on the basis of fraud, as an example of exceptional circumstances, are averments of fraud upon the Court granting the decree in Scotland, i.e. awarding sequestration. There are none. For that reason I consider that the Lord Ordinary decided correctly that the action could not possibly succeed and dismissed it.


[31] In discrete averments in Article 5 the reclaimer criticises the way in which the first respondent administered the sequestration. These could never amount to exceptional circumstances. In Articles 11, 12 and 13 of Condescendence the reclaimer avers that the Patents Act, the Legal Aid (
Scotland) Act and the Bankruptcy (Scotland) Act are in various vaguely expressed ways incompatible with the law of the European Union and the European Convention on Human Rights and Fundamental Freedoms and in breach of the Human Rights Act. The Lord Ordinary rightly determined that these averments have no relevance to the question whether there are exceptional circumstances. Even if the reclaimer had followed the appropriate procedural course in mounting his challenges to that legislation, all that he could have secured was a declaration of incompatibility of the legislation with some element of European law, since the statutes challenged are legislation of the United Kingdom Parliament. That could not conceivably amount to exceptional circumstances justifying reduction of the award of sequestration. The averments in Article 14 relate to the proceedings before the Court in England which it is not open to the Lord Ordinary or this Court to review - Clarke v Fennoscandia Ltd 1998 SC 464.


[32] The averments in Article 15, added by amendment before this Court, about the actions of the second respondents in relation to the reclaimer's legal aid application were departed from before us.


[33] The averments in Article 16, also added by amendment before this Court, are the only averments in the action which begin to address the challenge the reclaimer seeks to mount to the award of sequestration in an appropriate way. However, the challenge contained in these averments became in due course the subject of the petition. Had this Court decided to grant the reclaiming motion in relation to the petition, then it might have been appropriate to grant the reclaiming motion in respect of these and certain other averments in the action as a foundation on which the petitioner might build a relevant case by amendment in the event that he succeeded in the petition in having the registration of the certificate set aside. However, since the reclaiming motion in respect of the petition should, in my opinion, be refused, that possibility does not arise.


Decision


[34] For these various reasons I propose to your Lordships that both reclaiming motions be refused.


EXTRA DIVISION, INNER HOUSE, COURT OF SESSION

Lord Bonomy

Lord Woolman

Lord Marnoch

[2011] CSIH 69

OPINION OF LORD WOOLMAN

in Reclaiming Motions

in causa

JOHN HUMPHRIES PARKES

Pursuer and Reclaimer;

against

(FIRST) ROBIN MACGREGOR AND (SECOND) CINTEC INTERNATIONAL LIMITED

Defenders and Respondents:

and

JOHN HUMPRHIES PARKES

Petitioner and Reclaimer

against

CINTEC INTERNATIONAL LIMITED

Respondents

_______

Pursuer & Reclaimer & Petitioner & Reclaimer: Party

For First Defender & Respondent: D Thomson; Harper Macleod

For Second Defenders and Respondents: Mackenzie, Solicitor Advocate; Shepherd & Wedderburn

11 November 2011

Background

Introduction

[35] Mr Parkes is an inventor. He has worked for many years in the field of explosives. He holds a number of patents for containers filled with water which mitigate the effects of explosions. Cintec International Limited entered the same field in 2001. Mr Parkes came to the view that Cintec's products infringed his patents.

Patent Litigation in Scotland

[36] Mr Parkes became involved with an individual named Martin Frost. Mr Frost had considerable experience as a party litigant in the Scottish courts. It appears that he offered to assist Mr Parkes in the conduct of any proceedings that were raised against Cintec. The two men became partners. In July 2003, they raised patent proceedings in the Court of Session and applied for interim interdict against Cintec. Their application was refused. On 9 September 2005, Lord McEwan dismissed the action after a debate. He held that there was no jurisdiction to hear the action in Scotland: [2005] CSOH 119.

Patent Litigation in England

[37] Shortly after the Scottish action was raised, Cintec raised proceedings of the High Court in London against Mr Frost and Mr Parkes as co-defendants. Cintec sought an injunction forbidding them from threatening patent infringement proceedings in the United Kingdom. The defendants lodged defences and a counterclaim. The matter proceeded before Mr Justice Laddie in the Chancery Division. On 2 October 2003, he issued judgment in favour of Cintec: [2003] EWHC 2328 (Ch).

[38] Mr Parkes' decision to be assisted by Mr Frost appears to have been unfortunate. At the conclusion of his opinion, Laddie J stated:

"83. As I say, Mr. Parkes was not well served by Mr. Frost. In July, Jacob J had pressed the defendants to obtain proper professional representation. Mr. Frost said they did not to do so, not through lack of funds but through choice. The way this trial was conducted shows just how right Jacob J was. I venture to suggest that had the defendants given full and complete instructions to competent patent lawyers and had taken their advice, this case would either not have come to court at all or it would have been over much more quickly. The cost consequences of failing to pay heed to Jacob J are likely to be significant."


[39] The Final Order of the Chancery Division granting an injunction was pronounced on
16 October 2003. The defendants signed a docquet appended to that document, which stated "We consent to an order in the above terms."

The Order for Costs


[40] Cintec estimated that they incurred costs of over £200,000 in respect of the English action. Laddie J made an order against the defendants jointly and severally requiring them to pay interim costs of £90,000. It was agreed that payment of that sum should be stayed to allow the defendants to provide certain securities to Cintec. These included (a) a painting entitled "Seascape" by Richard Parkes Bonnington, which Mr Frost said he owned; and (b) a charge being granted by Mr Parkes over his house in
Edinburgh.


[41] The conditions were not met. The defendants therefore became liable to pay the sum of £90,000. Cintec made a formal demand for payment on
21 January 2004. As no payment was made, it decided to enforce the judgment in Scotland, where both defendants were domiciled.

The Statutory Framework


[42]
The procedure that applies to the enforcement of judgments containing money provisions within the United Kingdom is relatively straightforward. It is set out in Schedule 6 to the Civil Jurisdiction and Judgments Act 1982. A person seeking to enforce a judgment in another part of the United Kingdom applies for a certificate from the "home court". The proper officer of that court issues a certificate in a prescribed form. It must state: (a) the sum due; (b) that there is no appeal outstanding in respect of the judgment; and (c) that the judgment has not been stayed or suspended: Sch. 6, paragraphs 3 and 4.


[43] An application is then made to the proper officer of the other UK jurisdiction to register the certificate in that court: paragraph 5. In Scotland, the proper officer is the Keeper of the Registers of Scotland. When an application is duly made to him with a valid certificate, he has no discretion in the matter. He "shall register the certificate in that court in the prescribed manner": paragraph 5 (3); see also Rule of Court 62.37. Once registered, the judgment can be enforced as if it had been issued by the registering court: paragraph 6.


[44] With regard to the validity of registration, Schedule 6 states that:

"10. Where a certificate has been registered under this Schedule, the registering court - (a) shall set aside the registration if, on an application made by any interested party, it is satisfied that the registration was contrary to the provisions of this Schedule ..."

The Certificate

[45] Cintec applied for a certificate to enforce the interim costs award granted by Laddie J. Under the English court rules, the written evidence supporting an application under the 1982 Act must include the debtor's address, if known: r.74.17 CPR. Cintec maintains that condition was met on this occasion. For his part, Mr Parkes accepts that both his and Mr Frost's home addresses were contained within the English court documents. On 29 January 2004, Master Bragge issued a Cross border Certificate of Money Provisions ("the Certificate"). It omitted those two addresses.


[46] Cintec passed the Certificate to its Scottish solicitors, Shepherd and Wedderburn. The matter was dealt with by one of their partners, Mr Gordon Deane. His assistant at the time was Miss Kirstie Ross. In her sworn witness statement dated
3 March 2010, she explains what then occurred:

"4. Cintec instructed [Shepherd and Wedderburn] to enforce a costs order that Cintec had obtained ... On Monday 2 February 2004, I received from Cintec's English solicitors ... a Certificate sealed by the Chancery Division of the High Court of Justice. It was signed by Master Bragge. I reviewed the relevant legislation and Scottish Court Rules to determine the proper procedure for having the Certificate registered for enforcement in Scotland. During the course of this review, it appeared to me that the relevant Scottish Court Rules required the addresses of those persons against whom the Certificate was to be enforced to appear on the Certificate. ... In order to confirm my understanding, I contacted the Registers of Scotland to make enquiries about this matter. I obtained their confirmation that it would be acceptable for me to include the addresses of John Parkes and Martin Frost in manuscript on the Certificate, so that it could be presented to the Registers of Scotland.

5. I duly complied with this guidance and included the addresses of John Parkes and Martin Frost on the Certificate in manuscript. I then arranged for the Certificate to be presented to the Registers of Scotland."


[47] Mr Parkes disputes this account. He lodged an email from the office of the Keeper of the Registers of Scotland, which states that the staff there:

"... would not alter any document sent for registration which appeared to have an omission or error in it." [and] ...

"would not instruct a solicitor to add the omitted data to an incomplete court document: we would return the document to the agent and point out to them the information that was missing."

On the view I take of matters, it is unnecessary to resolve this factual issue.

The Sequestration of Mr Parkes


[48] The day after registration of the certificate, a charge for payment was served on Mr Parkes. On
25 February 2004, he wrote to Cintec's English solicitors to say he would pay the sum due, as "I am a man of my word". However, the days of charge expired without payment. Cintec then presented a petition seeking his sequestration on the basis of his apparent insolvency: Bankruptcy (Scotland) Act 1985 s.7. Mr Parkes did not provide a relevant defence to that petition. He did not pay or satisfy the debt, or produce written evidence of the payment or satisfaction of the debt, or show that there was sufficient security for its payment.


[49] Accordingly on
10 June 2004, Mr Parkes was sequestrated. The award was backdated to 8 March 2004, when warrant to cite was served upon him and the sequestration process began. The Accountant in Bankruptcy was appointed as permanent trustee on the sequestrated estate. In accordance with the legislation, Mr Parkes was automatically discharged from his sequestration on 8 March 2007. Prior to that date, however, he had made several different applications to set aside the sequestration, which I shall now outline.

The Petition for Recall


[50] In June 2004, Mr Parkes presented a petition to recall his sequestration.
That is the normal method of challenge. Section 15 (4) of the Bankruptcy (Scotland) Act 1985 provides:

"Without prejudice to any right to bring an action of reduction of an award of sequestration, such an award shall not be subject to review otherwise than by recall under sections 16 and 17 of this Act."

The court is given a wide discretion to grant recall. It may do so if the debtor pays his debts or provides full security for their payment.


[51] Lord Macphail dismissed the petition as being irrelevant: [2005] CSOH 98. As the reclaiming motion marked against that decision was refused for want of insistence, it is unnecessary to consider the question of recall further.

The First Action of Reduction


[52] In December 2004, Mr Parkes raised an action of reduction against the trustee in bankruptcy. At the time of lodging the summons, he sought interim interdict to prevent his sequestration proceeding. Lord Menzies refused that motion on
10 December 2004. He held that there was no prima facie case for setting aside the sequestration.


[53] Subsequently, Cintec was sisted as a defender in the action. Your Lordship in the chair has explained the procedural problem which then occurred. In due course, the case came before Lady Paton for debate. On
11 March 2008, she dismissed the action on the ground that it was irrelevant: [2008] CSOH 43. She held that Mr Parkes had failed to demonstrate any exceptional grounds which would justify granting the remedy of reduction.

Further Proceedings in England

[54] Mr Parkes then applied to the English court to set aside the Certificate. One of the arguments he advanced related to the addition of the addresses in manuscript. He contended that the act of Cintec's Scottish solicitor should render the Certificate invalid. It was contended that, as registered, it was a different document from the one issued by the court. On 19 May 2009, Master Bragge refused to revoke the Certificate. He stated:

"It appears to me that it was no doubt a mistake in the certificate presented to me, the address was not included but it appears no more than an unfortunate mistake and does not appear to be a matter the Court was misled on or indeed, not was it indicative of any improper activity by [Cintec's] solicitor ...

Therefore, it cannot be a matter for this Court to determine the issue of adding addresses; this is a matter for the Scottish procedural law."

[55] Master Bragge indicated that he was prepared to issue an amended certificate and refused leave to appeal. A transcript was made of certain oral exchanges, which took place in court immediately after he issued his judgment. The Master is recorded as stating

"I have made it clear that I consider the addition of the addresses not to be culpable ... I would view that as an omission which I would seek to rectify under the Civil Procedure Rules. I have left open to you the position under Scottish law but I am not going to further ... deal with what I have already said in my judgment."

On 19 October 2009, leave to appeal was also refused by Peter Smith J. Mr Parkes then sought and was granted an oral hearing on the matter. Permission to appeal was again refused by Morgan J.


[56] Although Cintec originally sought an amended certificate, it decided after the hearing before Master Bragge that it did not require one. It wrote to the English court and stated that it would only seek one if it became necessary to do so. An amended cross-border certificate was therefore never issued.

The Second Action of Reduction


[57] In November 2009, Mr Parkes raised a petition for reduction in this court. Founding on paragraph 10 of Schedule 6, he sought to reduce the registration of the Certificate on the basis of the same submission that had been before Master Bragge. After debate,
Lord Brodie dismissed the action as irrelevant. He held that "Nothing has been put before me to suggest that registration was contrary to the Schedule": [2010] CSOH 38.

The Principal Issue


[58] Mr Parkes has reclaimed the decisions of both Lady Paton and
Lord Brodie. There are a number of grounds of appeal. At the hearing, however, it became clear that the central issue concerns the validity of the registration. If the registration of the Certificate is valid, then all that has proceeded since then has been done properly and lawfully. Both reclaiming motions would fall to be refused. If it is invalid, however, then the petition would have to be remitted to Lord Brodie to deal with the plea of mora. No further steps would need to be taken in the action which came before Lady Paton until that question is resolved.

[59] It is important to affirm that the validity of the Certificate is not in issue. The competent court to determine that matter is the English court: Clarke v Fennoscandia Ltd 1998 SC 464, at 468G-H. As the Master refused to grant Mr Parkes' 2009 application, this court must proceed on the basis that the Certificate is valid.

Was the Registration Contrary to the Provisions of Schedule 6?

[60] Accordingly, the focus of scrutiny is the registration of the Certificate. What is the effect of the holograph additions? By adding the addresses of Mr Parkes and Mr Frost, did the Scottish solicitors vitiate the registration process?


[61] The answer to those questions turns on the proper construction of the phrase "contrary to the provisions of this schedule". It is unnecessary to seek to identify all the circumstances which that phrase may comprehend. There may be various forms of compliance failure. Clear cases would occur if the express steps set out in Schedule 6 were not followed, or something was done which subverted or materially altered the substance of the obligation owed by the debtor to the creditor. A classic example would occur if the applicant altered a certificate to increase the sum certified.


[62] Here the steps set out in the 1982 Act were followed. The Schedule does not stipulate that the debtor's address must be included in a cross-border certificate. That is not surprising. In some instances, the address may not be known. So there is no fundamental nullity in the proper officer registering a certificate without an address. Not only was it registrable, it was also enforceable.


[63] As a matter of practice, however, Scottish decrees normally include the address of the debtor. That is for good reason. As
Lord Brodie explained: "enforcement may be difficult in the event that the party against whom decree has passed is identified only by a name" (Opinion, paragraph 14).


[64] In this case, Mr Parkes accepts that the two addresses that were added to the Certificate were correct. That is a matter of some importance. It might be said that the additions did not alter the document in any material way. If it had been registered in its original form, the Messenger at Arms instructed to enforce the judgment could have readily ascertained the two addresses from the court processes. That consideration can be aligned with another factor. The solicitor's act did not prejudice Mr Parkes. He was not wrongly designed.


[65] In light of that analysis, I hold that the registration of the Certificate was not contrary to Schedule 6. I find support for that conclusion in the authorities.


[66] In King v Creighton (1841) 4D
62, a number of persons indorsed a promissory note for £300. All they put on the note were their names. The last holder of the note purported to add the designations of the indorsers. Most of the additions were inaccurate. It was held that this did not vitiate the document. Opinions were delivered by Lord Medwyn and Lord Moncreiff, with whom the other members of the Second Division concurred.


[67] Lord Medwyn stated at page 67:

"Now I cannot see that there is here any vitiation or alteration of the note which will destroy it as a document of debt. What has been added does not relate to any of the constituent parts of a bill or note: neither to the date, term of payment, amount of sum, nor order, character, or number of obligants on it. ... The addition is a mere memorandum ..."

Lord Moncreiff put the matter as follows:

"As the additions made to the names were not at all necessary to the bill, and really constituted no part of it, I cannot think that the defenders, taking such a note for value, and, merely for their own guidance, making such markings on it, should thereby have annulled the bill as a ground of diligence, and rendered it impossible to correct the error. It appears to me that the authorities do not at all warrant such a conclusion; but, on the contrary, lead directly to the opposite rule, that where that which has been done is in a point not material to the substance of the bill, it may be disregarded, or the error corrected, to all effects." (page 70)

Applying that approach to the present situation, in my view it is easy to characterise the additions as mere memoranda, which are not material to 'the substance' of the Certificate.


[68] An analogy can be drawn with the issue of extracts. In relation to clerical and similar errors, the court has a general power to correct matters to ensure that substantial justice is done between the parties. As it is put in Maclaren: "Where the materials are found in the process for the correction of an error in a decree, the Extractor himself may put the matter right in the extract." Court of Session Practice page 1103, footnote 3 and cases there cited.


[69] That power can also be discerned in McKellar v Dallas's Ltd 1928 SC 503. In that case a question arose as to the meaning and effect of an interlocutor that contained the word "declares" and omitted the word "ordains". It was asserted that the decree should not have been extracted without the second word. Lord Justice Clerk Alness held "that the interlocutor, as a matter of common sense and reasonable interpretation" was valid. The opinions of the other judges were to similar effect.


[70]
In my view, that approach should be followed in this case. The addition of the addresses can be treated as de minimis. Applying common sense, one can say that the alteration did not affect the substance of the decree.


[71] I wish to emphasise that I do not condone unauthorised tampering with a court order. However, in the particular circumstances of this case I am satisfied that what took place did not vitiate the Certificate.

The Other Issues in the Reclaiming Motions


[72] I agree that the other arguments raised by Mr Parkes should be refused for the reasons outlined by your Lordship in the chair.

Conclusion


[73] In my opinion, Mr Parkes has failed to identify any error in law on the part of either Lord Ordinary. The reclaiming motions should therefore be refused.


EXTRA DIVISION, INNER HOUSE, COURT OF SESSION

Lord Bonomy

Lord Woolman

Lord Marnoch

[2011] CSIH 69

OPINION OF LORD MARNOCH

in Reclaiming Motions

in causa

JOHN HUMPHRIES PARKES

Pursuer and Reclaimer;

against

(FIRST) ROBIN MACGREGOR AND (SECOND) CINTEC INTERNATIONAL LIMITED

Defenders and Respondents:

and

JOHN HUMPRHIES PARKES

Petitioner and Reclaimer

against

CINTEC INTERNATIONAL LIMITED

Respondents

_______

Pursuer & Reclaimer & Petitioner & Reclaimer: Party

For First Defender & Respondent: D Thomson; Harper Macleod

For Second Defenders and Respondents: Mackenzie, Solicitor Advocate; Shepherd & Wedderburn

11 November 2011


[74] For all the reasons given by your Lordship in the Chair I agree that these reclaiming motions be refused.


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