Alastair Johnston, Senior Associate in our Litigation division, explores a recent decision regarding wrongful interdicts.
What was the question before the Court?
An interesting question has recently been answered by the Court of Session: is a wrongful interdict a "one off wrong" or does it give rise to a wrong each day that it remains in place? This question is of critical importance when considering if a claim for damages arising from a wrongful interim interdict is time barred five years after an interdict is granted or five years after the interdict is recalled or removed.
The question was considered by Lady Carmichael in the case of Martin McGowan v Springfield Properties Limited. The case called as a debate on several issues, the most critical being whether the Pursuer's claim for damages arising from an allegedly wrongful interdict had prescribed and was time barred.
What happened in this case?
The facts of the case were that Mr McGowan, a former contractor of Springfield, made various allegations as to Springfield's health and safety practices involving asbestos at their sites. Springfield denied these allegations and subsequently obtained an ex parte interim interdict against Mr McGowan not only from making any false statements, but also from making any statement whatsoever in respect of their operations at these sites. The interim interdict was granted on 5 February 2016. For various reasons no steps were taken by Mr McGowan to recall the interim interdict until around May 2021. Various documentation was lodged with the court which Mr McGowan said demonstrated that his accusations were, at least in part, well founded. Mr McGowan provided an undertaking that he would make no false statements concerning Springfield. Following this the interim interdict was recalled and the cause dismissed with no further substantive procedure. In or around 2 November 2021 Mr McGowan served a claim upon Springfield for damages arising from what he said was a wrongful interdict.
Springfield claimed that the claim had prescribed on 5 February 2021. In support of this position, they referred to Section 6(1) and Section 6(3) of the Prescription and Limitation (Scotland) Act 1973. In essence this provides that the prescriptive period commences from the point an obligation becomes enforceable, and that an obligation becomes enforceable when both wrong and loss (damnum and injuria) have occurred. Springfield argued that this was the point when the interdict was granted. Mr McGowan relied upon Section 11(2) of the Prescription and Limitation (Scotland) Act 1973 which essentially provides that the prescriptive period does not commence until the wrongful act has ceased where the wrongful act was a continuing act or omission. Mr McGowan argued that Springfield's failure to remove the interdict constituted a continuing wrong, and that the prescriptive period did not commence until such time as the interdict was removed.
In response, Springfield sought to argue that the onus was on either Mr McGowan to have taken steps to remove the interdict or for the Court to do so. Mr McGowan referred to the legal principle that an interdict is a remedy which is taken at the party's own risk, and if it transpires to be wrongful they are accordingly liable.
Lady Carmichael preferred the arguments of Mr McGowan and decided that "In practice, it is unlikely that the court would decline to recall an interim interdict on the unopposed motion of the party who had been granted the interdict. Although the court would require to pronounce an interlocutor recalling the interim interdict, it is not, in reality, a matter beyond the control of the party holding and benefiting from the order." Lady Carmichael emphasised that damages arise not from the simple pronouncement of an interdict, but from the other party being prevented from exercising a right. This wrong therefore continues as long as the interdict is in place, and accordingly Section 11(2) of the 1973 Act applies.
What does this mean?
This case emphasises the importance of carefully considering whether an interdict is appropriate, as parties commonly seek interdicts as part of a knee jerk reaction to achieve what they consider will be a strategic advantage over the opposing party. Not only is this a risky approach but it is now clear that liability will arise for the entire period of the wrongful interdict which may give rise to substantial damages.
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