Outer House finds makers of ink machine liable for just over £3,000 of £29 million claim by cigarette paper manufacturer

By Mitchell Skilling

It was averred by Benkert UK Ltd that a fire that destroyed their premises in Alva, Clackmannanshire, was caused by the breach of contract and fault and negligence of the defender, Paint Dispensing Ltd (formerly Rexson Colorweight Ltd). The defender argued that any liability on their part was limited by the terms of their contract.

The case was heard by Lord Tyre in the Outer House of the Court of Session. A Smith QC appeared for the pursuer and Young QC for the defender.

Specifically built

On 10 November 2009, a fire occurred at the pursuer’s industrial premises in Alva, where it made printed paper used mainly for cigarette filters. The paper was printed with solvent-based coloured ink that was mixed by two dispenser machines supplied by the defender. The defender, which had built the machines specifically for the pursuer, maintained them in accordance with a series of contracts.

It was not disputed that the fire, which totally destroyed the premises, had started in the ink plant room when a spark ignited flammable solvent vapour; however, the parties disagreed on why this was likely to have occurred. The pursuer’s position was that a jubilee clip on the larger of the two machines had suddenly come loose and allowed the vapour to escape, while the defender contended that it was more likely that an employee of the pursuer had failed to follow correct procedure when filling the smaller machine with solvent.

Based on the available evidence, Lord Tyre concluded that the defender, through its engineer, was in breach of contract by failing to recommend that a less safe method of keeping the dispensers’ hoses connected be replaced with a safer one. However, under clause 5.3 of the parties’ then-current maintenance contract, the defender’s total liability “in connection with the performance or contemplated performance of the services” was stated to be limited to the amount of the annual maintenance charge payable by the pursuer, which at the time was £3,225.06 per annum.

The pursuer submitted that the defender had failed to prove that this clause satisfied the requirement of reasonableness under the Unfair Contract Terms Act 1977, the applicable law to the contract being English law. It was reliant on the defender’s expertise to maintain and repair the dispensers and thus had limited bargaining power when negotiating the contract. Further, it would be reasonable to infer that the defender’s £5 million of indemnity cover could be passed on to its customers along with insurance costs.

For the defender, it was submitted that it did not have a monopoly on the servicing of dispenser machines, and while it was logical to prefer to employ them as the designer of the machines, the pursuer had other options. Clause 5.3 had been highlighted to the pursuer and not hidden away in a lengthy document and it had been open to negotiations had the pursuer sought that.

Commercial judgment

In his decision on the limitation issue, Lord Tyre noted: “Clauses limiting a supplier’s liability to the contract price are not regarded by the courts as especially onerous or unusual. In any event the clause was in my view given sufficient prominence in the maintenance agreement which in effect ran to only six pages of normally sized and spaced print plus a short schedule, and in which clause 5.3 was prefaced by a warning in underlined capital letters.”

Turning to the defender’s available insurance, he said: “It seems to me that Benkert were in a much better position than Rexson to assess the size of the potential claim for losses including partial or total destruction of the factory and lengthy business interruption. In this regard the balance, in my view, favours Rexson being permitted in essence to say to Benkert: we will not accept liability for losses which for us are impossible to quantify; it is up to you to make whatever insurance arrangements you think necessary.”

On the equality of the parties’ bargaining power, Lord Tyre concluded: “It would no doubt have been inconvenient to attempt to seek out an alternative supplier of maintenance services. That, however, was a commercial judgment for Benkert to make, and I do not regard the desirability of contracting with Rexson as amounting in itself to an indication of lack of equal bargaining power. There was no evidence of whether any alternative supplier would also have sought to limit its liability. In these circumstances I find bargaining power to be essentially neutral in the balancing exercise.”

For these reasons, Lord Tyre held that the defender had discharged the onus of proving that the limitation of liability clause was fair and held it liable to the pursuer for the sum of £3,225.06 only.

Burness Paull to take space at Glasgow’s Atlantic Square development

The firm follows engineering and project management consultancy Atkins Limited, which last year became its first occupier.

Burness Paull will take a 10-year lease on the 14,814 sq ft. fourth floor of the 96,650 sq ft prime, sustainably built office accommodation. It ranges across six floors with 7,000 sq ft retail and restaurant space on the ground floor.

Tamar Tammes, managing partner at Burness Paull, said: “After a two-year search across the city we believe we have found the ideal home at 2 Atlantic Square. Our goal was to find a new base for our colleagues in Glasgow that was not only tailored to our new hybrid working principles, but also met the highest standard of environmental credentials.

“It is an impressive building in an area undergoing rapid transformation into the heart of Glasgow’s business district.

“Moving there sets us up perfectly for modern flexible working and ensures that clients and colleagues have easy access to a full range of transport connections.”

The £150 million, Grade A Atlantic Square development totals 300,000 sq ft across three separate buildings. 10-storey 1 Atlantic Square covers 187,000sq ft and was pre-let to the UK government as part of the HMRC Hubs program, forward funded by Legal & General Investment Management.  It will house over 2,000 government employees.

Dougie Peters, BAM Properties’ managing director, said: “This letting to one of Scotland’s most prestigious legal firms is a reflection of the stature of the accommodation, for which there is continuing market interest.

“It shows that there remains a strong future for commercial office space in Glasgow and the quality of the accommodation forms part of occupiers’ approach to attracting and retaining talent.”

Anderson Strathern re-appointed to APUC framework

Anderson Strathern’s position as first ranked supplier means universities and colleges in Scotland are required to approach the firm first for direct contract awards.

Glasgow Caledonian University and Fife College are the firm’s latest client wins in the sector, both secured in 2021, and add to existing higher and further education sector clients the University of Strathclyde, Edinburgh Napier University, the University of St Andrews, Ayrshire College, Edinburgh College, Glasgow Clyde College, Moray College, North Highland College and South Lanarkshire College.

Murray McCall, managing partner, Anderson Strathern, said: “The higher and further education sectors have been specialist areas for the Education Team within the firm for a number of years now, we have built great expertise accordingly, and it is the commitment of our people to these education clients that underpins the recent APUC re-appointment and top-ranking.

“Throughout Scotland, our universities and colleges, while each is very different in their own way, continue to be shining examples of the highest standards, with graduates going on to help fuel many different parts of the economy. At the same time, the Covid pandemic has challenged our education institutions and their students in a generational kind of way, and it has been incredible to see how they have innovated to keep the wheels turning through areas like virtual and blended learning.

“From our point of view, we are able to support the universities and colleges around many legal aspects including governance, charity law, property and estates, people and human resources, mergers, commercial including intellectual property and spinouts, procurement and subsidy control, and internationalisation.”

Promotions and appointments at Wright, Johnston & Mackenzie

The firm has welcomed Vicki Provan, a former partner at the firm, who has taken on the role of commercial property consultant. Amen Chaudry has also joined the commercial property team as solicitor.  

Fraser Gillies, managing partner at WJM, said: “I’m delighted to welcome Vicki back to the team. Her commercial property knowledge is invaluable, and her expertise will be vital as this area of law continues to be a major focus for our business. I’m also very pleased to have Amen on board, who is going to be a fantastic new addition to the team.”

Fergus Hollins and Alex Mudie have both been promoted to senior solicitor within the firm’s corporate team, while Jenna Gallacher, who is based in WJM’s Inverness commercial property division, has also made the step up to senior solicitor.

Mr Gillies added: “It’s been a fantastic start to the year for WJM and these appointments and promotions are testament to our success and positive outlook for the year ahead.”

American legal scholar to lecture on Biden administration and international law at Edinburgh event

Harold Hongju Koh, Sterling professor of international law and former dean at Yale Law School, will be speaking in person at Edinburgh Law School on March 11.

Professor Koh is currently George Eastman visiting professor at Oxford and a fellow of Balliol College. He has served under four presidents and is the author of eight books and more than 200 articles.

A graduate of Harvard, Oxford and Harvard Law School, he has received 17 honorary degrees and more than 30 awards for his work in human rights and international law, including awards from the American Bar Association and Columbia Law School for his lifetime achievements in international law.

Register here

Eversheds Sutherland increases regional NQ pay by 24 per cent

London NQs will see an increase of 15.8 per cent, from £82,000 to £95,000. Lawyers elsewhere will see their pay rise from £50,000 to £62,000, a jump of 24 per cent.

The changes are due to take place from May 1.

The increase in the regions still trails DLA Piper, however. NQs there have seen their salaries go from £48,000 to £65,000. 

Lee Ranson, chief executive of Eversheds said in a statement: “Retaining and attracting the best talent is a key priority and salary and bonuses form an important part of our overall employee proposition, alongside culture, learning and development and quality of work. With this in mind, I am pleased to announce this investment in our UK newly qualified rates.”

Lawyer censured and fined £1,000 over AML failures

Stephen McGuire, of Hennessy Bowie, was censured by the Scottish Solicitors’ Discipline Tribunal (SSDT). He was cashroom manager and AML partner and thereafter money laundering reporting officer at the firm. A number of inspections of the firm’s accounts between 2013 and 2016 found serious failings.

His conduct “in relation to a wide variety of breaches over a significant period of time fell below the standards of conduct to be expected of a competent and reputable solicitor to a serious and reprehensible degree. He was therefore guilty, in cumulo, of professional misconduct”.

The SSDT stated: “The Tribunal considered whether a restriction on the Respondent’s practising certificate was necessary but was satisfied there was no ongoing risk to the public. His former partner had been struck off, and the Respondent had taken on another solicitor who was assisting with compliance. The Respondent’s formal instruction to wind up the firm by Easter 2022 supported the Tribunal’s view that a Censure and Fine of £1,000 would be sufficient in all the circumstances of this case.”

Shared Parenting Scotland brings New Ways For Families training to Scotland

All coaches have a background in family law, mediation, family therapy, social work or similar, and will be trained and supported by the High Conflict Institute which has developed the New Ways For Families training in the USA and Canada. 

Coaches work with individual parent learners who undertake a 12-module online course. The coach has direct one-to-one sessions by phone or internet at the start, middle and end of the online course, enabling learners to practice skills and consolidate their understanding of the training. Coaches are paid an hourly rate. 

The coaching is limited to the educational and therapeutic issues addressed during the course. Coaches do not have any other professional involvement with the learners and do not give legal advice or guidance. 

Shared Parenting Scotland national manager, Ian Maxwell, said: “We have been following the evolution of this training for several years and are delighted to make it available in Scotland. It isn’t mediation and isn’t legal advice. The aim is to bring parents who have lost sight of the damage prolonged conflict does to the children they both love back to reality. Analysis of New Ways for Families work in the US showed 4 out of 5 parents doing the training managed to resolve issues and improve relationships without going back to court.”

Shared Parenting Scotland is holding a webinar on Thursday 17th February from 4-5pm to launch the pilot of New Ways for Families Training in Scotland. The event will start with presentations about how the online training and one-to-one coaching will operate, followed by a chance to ask questions about the pilot. To book a free place at the webinar contact Claire Ross on cr@sharedparenting.scot or ring 0131 557 2440 for further details.

Morton Fraser names Action for Children its charity of the year

Action for Children’s vision is that every child and young person has a safe and happy childhood, and the foundations they need to thrive.

Morton Fraser will be fundraising throughout the year to help support Action for Children in their work to provide practical and emotional care and support for children and young people in Scotland. The firm’s fundraising activities will include taking part in the Kiltwalk, joining some of the great events organised by Action for Children and office bake sales. Morton Fraser will also be volunteering at Action for Children’s events and projects in both Glasgow and Edinburgh.

Chair of Morton Fraser, Jenny Dickson, said: “We are delighted to be supporting Action for Children. In Scotland, their work includes supporting families, helping young people get into employment and providing foster care. We are looking forward to playing our part in their work and to learning more about the impact Action for Children has on the lives of young people and their families.”

Paul Carberry, Action for Children’s director for Scotland, said: “We are grateful for Morton Fraser choosing to support Action for Children. We know this year will be especially difficult for the most vulnerable as the cost of living crisis escalates and pushes more families below the poverty line. At Action for Children, we take a holistic approach to addressing the many issues faced by children, families and young people and through our partnership with Morton Fraser, we will be able to increase our support to those who need it most.”

If you would like to donate please click here.

Quote of the day

Politics is a substitute for violence.

Dick Gephardt

And finally… prison break

The new prison in Zurich, Switzerland, has capacity for 241 remand prisoners, but authorities decided to test the facility on local volunteers before it opens in April, Swissinfo reports.

More than 600 people have applied for the test run, during which they’ll experience real prison conditions for four days in March – giving up their phones and eating only prison meals.

Prison director Marc Eiermann told a local newspaper that it would not be a “holiday camp”, but added that volunteers would be allowed to leave early if they want.

What is the Register of Persons Holding a Controlled Interest in Land?

The new RCI will go live on 1 April 2022, although if you set a calendar reminder for that date, be ready to snooze it for a month as there will be no entries entered in the RCI for at least the first 30 days. The reason for this is that the Keeper is obliged to wait at least 30 days after receiving the information before entering it into the RCI to allow a period for applicants to be able to apply for a security declaration and for the Keeper to make a decision before publishing any information on the register.

The focus behind the new register is transparency and the RCI will provide information on the people making key decisions on land and property in Scotland.

There will be a responsibility on owners and tenants to supply information to the RCI if they have a controlling interest that isn’t already registered or recorded or available publicly elsewhere (such as Companies House). Registration will be open to owners, tenants or representatives on their behalf (for example, solicitors or accountants) from Friday 1 April 2022. There is a 12 month grace period to register before penalties become applicable for failure to do so.

At Millar & Bryce, we do not think that there will be any need for a search in RCI in ordinary conveyancing matters. However, in certain circumstances, you might require a search in the RCI. For example, if you are onboarding a Trust as a new client and the trustees are not registered in the Land Register (or recorded in the Sasine Register) you may require a search of the RCI to confirm that their controlling interest is noted. If not, then RCI registration can and should be effected, or steps could be taken to complete the title of the uninfeft persons.

You can be assured that Millar & Bryce will be on hand to provide you with a search in the RCI in any circumstances that you require one. If you have any questions, about the RCI please email us at relationship@millar-bryce.com.

Gary Donaldson, product & operations director (Millar & Bryce)

Global Language Services Ltd

However good the technology is, it cannot pick up the subtleties of a language, the culture that underpins it, or even the humour that oils many of our conversations.

For this reason there has always been a need for skilled interpreters and translators and probably always will. That’s where Global Language Services Ltd can help you.

Not only do we have the language service talent that you are likely to need, we also have a track record that spans Government, health, justice, commercial and private sector contracts.

So, whatever you want to achieve in a different language, we’re on your side from the word ‘go’.

We go out of our way to help with any translation and interpreting requirements and you can test that simply by picking up the phone and getting in touch. Calls are answered by trained operators with no call centres – just real people determined to help you achieve your language service requirements as quickly as possible.

If you’ve been searching for Professional Translation or reliable Interpreting Services at competitive prices, we like to think that Global will be your long-term partner after your first project with us.

With offices in Glasgow, Edinburgh, Inverness and Aberdeen we are committed to finding local interpreters and translators wherever possible. Our reach, however, goes much further than Scotland and we are happy to take translation projects from across the world.

Call Today on 0141 429 3429 to discuss your Project or email mail@globallanguageservices.co.uk