In any commercial litigation in Scotland, it is open to the parties (and to the court on its own initiative) to appoint an expert – known as a court reporter - to examine factual evidence and to report to the court on his or her findings. The purpose of this procedure is to avoid the need for a proof (trial) on the issues that are the subject of the reporter's remit. It is a process which is designed to save the parties (and the public purse) time and money.

Unsurprisingly, the court reporter procedure has proven popular amongst parties litigating claims for terminal dilapidations. It is generally far more efficient for an independent third-party expert (usually a building surveyor) to examine the available evidence and report on the extent of repair works required and the cost of the same. This can save days, or even weeks, of evidence.

So far, so good. But a remit to a court reporter is not always the panacea that parties might hope for. What if they are unhappy with the reporter's findings?

The recent decision in William Dale Hill and Rowanmoor Trustees Limited as Trustees for the HFD Management Services LLP Family Pension Trust v Apleona HSG Limited is a useful reminder of the limited circumstances in which the findings of a reporter can be challenged. The judge (Lord Braid) summarised the role of the court - in scrutinising a reporter's findings – in three short points:

  1. the parties are bound by the terms of the joint remit, which will prescribe the questions to be answered and the procedure to be followed. This means that - unless a reporter strays outside of the limits of the remit – it is generally not possible to challenge the findings they make. Framing the terms of the remit is therefore incredibly important. The court will not come to the rescue of a party who subsequently seeks to argue that the remit should have said something else.
  2. the findings of the reporter on the issues remitted and are final and binding. Once an issue of fact has been determined by a reporter, neither party can lead and evidence on it at proof (trial) and invite the court to reach a different conclusion.
  3. the court always has jurisdiction to order further enquiry where a reporter has failed to exhaust or to comply with the terms of the remit. The court will not reach its own decision on any issue where the reporter has erred. It will instead direct the expert to reconsider and to issue another report.

In HFD, the landlord's principal objection to the findings of the reporter was that he made a finding of 'not proven' in relation to a number of wants of repair on the basis that he could not be satisfied that they existed at the end of the lease. The joint remit agreed between the parties entitled the Reporter to make such further enquiries as he reasonably considered proper to allow him to reach an opinion on any of the questions remitted to him. But the court found that this did not oblige the reporter to do so and that it was therefore open to him to make a 'not proven' finding. If the landlord was troubled by this outcome then the judge's pithy answer was that it should have either (a) framed the remit so as to impose a duty on the reporter to carry out further enquiries or (b) provided sufficient evidence that wants of repair existed on the material date.

The final issue that arose in HFD was that the report took a long time to finalise and, as such, that it had delayed the progress of the litigation. The main reason for this was the time that it took to agree the terms of the remit. If the court reporter procedure is to achieve the purpose which parties have in mind (i.e. to save time and money) then a remit has to (1) clearly and comprehensively reflect the parties intentions and (2) be agreed quickly. Of course, in many cases, this may present a challenge.

When it works well, the court reporter procedure brings significant benefit to landlord and tenant, but it is important to be aware of the potential pitfalls. It may not be right for every case

If you require advice in relation to a dilapidations claim, please do not hesitate to get in touch with our Real Estate Litigation team or your usual Brodies' contact.

Contributors

Gareth Hale

Partner

Andrew Deanshaw

Associate