Hill & Anor v Stewart Milne Group [2011] ScotCS CSIH_50 (03 August 2011)

Hill & Anor v Stewart Milne Group [2011] ScotCS CSIH_50 (03 August 2011)

The defenders failed to make sufficient averments to support their assertion that the payment provision was an unenforceable penalty; the burden of proof lies with the defenders; the provision is not automatically unenforceable and the pursuers are entitled to proof on remaining issues.

Citation
[2011] ScotCS CSIH_50
Parties
Pursuer and Appellant: Stewart Wells Hill; Pursuer and Appellant: Robert Thomson Hill; First Defender and Respondent: Stewart Milne Group; Second Defender and Respondent: Gladedale (Northern) Limited (formerly Bett Limited)
Jurisdiction
Scotland
Judgment Date
03 August 2011
Procedural Posture
Appeal / Appeal From Sheriff Principal to Court of Session, Inner House
Outcome
appeal allowed
Legal Topics
Penalty Clauses, Liquidated Damages, Burden of Proof, Interpretation of Contractual Obligations
Contract Law Scottish Civil Procedure Penalty Clauses Liquidated Damages Burden of Proof Interpretation of Contractual Obligations

Case Brief

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Parties

Stewart Wells Hill

Pursuer and Appellant

Robert Thomson Hill

Pursuer and Appellant

Stewart Milne Group

First Defender and Respondent

Gladedale (Northern) Limited (formerly Bett Limited)

Second Defender and Respondent

Procedural Posture

Appeal / Appeal From Sheriff Principal to Court of Session, Inner House

Legal Issues

  1. 1 Whether the contractual provision for £5,000 per month is an unenforceable penalty clause
  2. 2 Whether the obligation to pay arises on breach of contract or non-occurrence of a specified event
  3. 3 Burden of proof regarding penalty clause assertion

Ratio Decidendi

The defenders failed to make sufficient averments to support their assertion that the payment provision was an unenforceable penalty; the burden of proof lies with the defenders; the provision is not automatically unenforceable and the pursuers are entitled to proof on remaining issues.

Court Disposition

appeal allowed

Orders

  • Recall interlocutor of Sheriff Principal dated 19 August 2010
  • Restore interlocutor of Sheriff dated 12 February 2010