Ross Harper & Murphy & Ors v Banks [2000] ScotCS 120 (11 May 2000)

Ross Harper & Murphy & Ors v Banks [2000] ScotCS 120 (11 May 2000)

A partner may be liable to the firm and co-partners for loss caused by his failure to exercise reasonable care in the conduct of partnership business, and such liability is not excluded by the settlement agreement unless expressly or clearly provided. The exclusion and indemnity clauses in the agreement do not exclude the present claim for negligence or breach of duty owed to the firm.

Citation
[2000] ScotCS 120
Parties
Pursuers: Ross Harper & Murphy and Others; Defender: Scott Banks
Jurisdiction
Scotland
Judgment Date
11 May 2000
Procedural Posture
Commercial Action (damages Claim Between Former Partners) / Interlocutory Opinion on Relevancy and Effect of Settlement Agreement
Outcome
Pursuers' fifth plea-in-law sustained to the extent of repelling the defender's two pleas (pleas 2 and 3) based on the Agreement. Case put out By Order for further procedure.
Legal Topics
Liability of Partners to Each Other, Implied Terms in Partnership Agreements, Exclusion Clauses, Standard of Care Among Partners, Interpretation of Settlement Agreements
Partnership Law Contract Law Professional Negligence Liability of Partners to Each Other Implied Terms in Partnership Agreements Exclusion Clauses Standard of Care Among Partners Interpretation of Settlement Agreements

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Parties

Ross Harper & Murphy and Others

Pursuers

Scott Banks

Defender

Procedural Posture

Commercial Action (damages Claim Between Former Partners) / Interlocutory Opinion on Relevancy and Effect of Settlement Agreement

Legal Issues

  1. 1 Whether a partner may be liable in damages to the firm and co-partners for loss sustained by reason of liability incurred to a third party due to his act or omission
  2. 2 What is the standard of care owed by a partner to the firm and co-partners
  3. 3 Whether the settlement agreement between the parties excludes or discharges such liability

Ratio Decidendi

A partner may be liable to the firm and co-partners for loss caused by his failure to exercise reasonable care in the conduct of partnership business, and such liability is not excluded by the settlement agreement unless expressly or clearly provided. The exclusion and indemnity clauses in the agreement do not exclude the present claim for negligence or breach of duty owed to the firm.

Court Disposition

Pursuers' fifth plea-in-law sustained to the extent of repelling the defender's two pleas (pleas 2 and 3) based on the Agreement. Case put out By Order for further procedure.

Orders

  • Defender's pleas 2 and 3 repelled insofar as they rely on the Agreement
  • Case to be put out By Order to consider further procedure in light of the court's views on the first principal issue