Commercial actions Flashcards
What is the new procedure for commercial actions?
Business community criticised civil courts in 1990s for being slow, expensive and there was a lack of judicial expertise in commercial matters. As a result, a new procedure for commercial matters was introduced.
Chapter 47 of CoS is to enable specialist judges to handle commercial cases quickly and flexibly.
What are the rules for commercial actions in the sheriff court?
First introduced in Court of Session; then sheriff courts.
Sheriff Courts - Chapter 40 OCR
Generally, commercial actions are characterised by Procedural flexibility/judicial pro-activity.
Definition – OCR 40.1 - definition of commercial action is broad. It includes any transaction or dispute of a commercial or business nature, e.g. Commercial leases, building contracts, partnership agreements etc., and business property.
Only available where Sheriff Principal directs – OCR 40.2 The commercial procedure is only available in courts when the sheriff is nominated to act as a commercial sheriff. Currently this procedure is available in glasgow, inverness, peebles, jedburgh, selkirk and duns.
Commercial Sheriffs – dedicated one takes an active role in the case. A single sheriff will do this so the action will not simply be passed from sheriff to sheriff. They handle judicial proactivity/ case management
The preliminary stages are different to ordinary actions and procedures are flexible and streamlined.
Sheriff may make such order as he thinks fit for progress of the case: OCR 40.3
Actions may be raised as commercial action (OCR 40.4) by the pursuer electing to commence the action in a form or appointed on a parties’ motion (OCR 40.5) by the court.
It is also possible for a commercial action to be appointed as a ordinary cause. OCR 40.6 e.g. Where detailed pleadings are required.
What are the requirements of pleading in a commercial action?
Less rigorous pleading requirements
It is not necessary for defender to admit or deny all of the pursuer’s averments but they must allow the extent of the dispute to be identified and must have pleas in law.
No automatic right to adjust the pleadings.
No Options Hearing.
Instead case Management Conferences are held often by telephone which further procedure including a timetable for adjustment are set down and this is provided for in ordinary cause rule 40.10.
In the CMC the sheriff is required to seek to secure the expeditious resolution of the action. This means he takes a proactive role in case management and to do this he has a wide range of powers at his disposal. (OCR 40.12)
The sheriff will have studied papers in advance of CMC and parties representatives must be in a positive to provide sheriff with information as to whether further adjustments are required.
The sheriff can require parties to provide better specification and to disclose identify of witnesses and documents, to appoint parties to have their expert witnesses meet and to see what could be agreed and to lodge expert reports, affidavits and expert arguments and anything which the sheriff sees may result in the speedy resolution of the case.
The power of the commercial sheriff to ordain parties to provide specification of their case should result in fewer actions being taken to debate on technical pleading points. The sheriff will then determine substantive further procedure. This may well be for a procedure which neither party has asked for. So both parties may be seeking a proof but the sheriff has taken a different view and Rule that the matter is capable of being resolved by debate.
What is the commercial procedure in the court of session?
Chapter 47 RCS
There is mandatory Pre action protocol which should be followed in relation to commercial action except in limited circumstances - Practice Note 6 of 2004, para 11
Parties are expected to set out in pre litigation correspondence their position and to identify the nature of the dsispute, failure by a party to follow these procedures can result in an award for expenses for unnecessary preliminary procedure against them.
In the sheriff court a pursuer may commence an action as a commercial cause or either party may move for an ordinary action to be commenced on the commercial rule.
The commercial judge has broadly similar rules to the commercial sheriff. The procedural actions in the court of session “shall be such as the commercial judge shall order or direct” RCS 47.5
Instead of CMC’s Preliminary Hearings (RCS 47.11) are held shortly after the lodging of defences.
Before that hearing, parties are requried to lodge a statement of issues which identify the issues in the case.
There is no automatic right to adjustment, although the commercial judge will generally set down a timetable for adjustment and make such other order as he sees necessary to promote the speedy identification of the issues in dispute.
The preliminary hearing may or may not be continued.
Thereafter a Procedural Hearing (RCS 47.12) will be held where substantive further procedure will be determined.
Parties are required to lodge a statement of proposals for further procedure in advance of that hearing and to lodge witness statements in advance of proof. This means that the taking of parole evidence in cheif of witnesses to fact can often be a short exercise in which the witness confirms his name and address before adopting his witness statement and he will then thereafter be cross-examined.
