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Stewart Milne Group Limited v Ewen Ritchie – Aberdeen Sheriff Court 26 May 2009
Location: Case TypesCommercial    
Posted by: Catherine Hart 18/06/2009 17:26

The Pursuers raised a number of actions under the Commercial Court Rules (OCR Chapter 40) seeking to have the Defender in each case ordained to implement a contract for the purchase of heritable property. In the case of the Defender in the current action, the parties had entered into missives in which the Defender had offered to purchase a flat in a development being constructed by the Pursuers. In each case, the Pursuers also had an alternative crave for payment of damages failing implement. The Defender took a plea to the competency of the action being raised as a commercial action. The same plea was taken in the other cases and a Debate took place.The Defender argued that the action did not arise out of, and was not concerned with, "any transaction or dispute of a commercial or business nature" - the definition of a commercial for the purposes of Chapeter 40 of the OCR - and, on that basis, the action could not be raised as a commercial action. He also argued that, as there was no mechanism under the Commercial Court Rules for remitting the action to the Ordinary Cause Roll, the case should be dismissed.The Defender argued that, although the Pursuers were in business and were a commercial concern, he was not engaged in any way in a commercial business with the Pursuers, nor in the business of buying dwellinghouses. He was merely a customer of the Pursuers. Chapter 40 was intended to apply to all actions arising out of or connected with any relationship of a commercial or business nature, whether contractual or not, and the Pursuers’ pleadings did not suggest that there was such a relationship between the parties. The Defender argued that the Commercial Cause Rules were not intended to cover disputes between commercial organisations like the Pursuers and a “lay” purchaser like the Defender. This is because the transaction or dispute was not of a commercial or business  nature as it was outwith the Defender’s business or employment. In effect, the Defender was a consumer and the Missives were a consumer contract. The Pursuers argued that the Rules had to be construed in accordance with the ordinary use of English language, and also their context. A transaction could be “of a commercial or business nature” although it occurred in a consumer context. The Pursuers stressed that it was nature of the transaction, rather than the nature of the relationship of the parties to it, that was of significance. The Sheriff had to determine whether an action between a commercial organisation and a lay purchaser could be competently brought under the Commercial Cause Rules and whether the phrase “any transaction or dispute of a commercial or business nature” was wide enough to include a claim by a person in business against a customer, where the dispute arose from the Pursuer's business.

Court: Sheriff Court (Scotland)
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