Olivia Keenan | Trainee Solicitor

Let’s Get Real Personal

A deceased father’s estate; allegations of infidelity; fights between family members and a dispute over the lease of the chip shop in a petrol station in South Uist. The Sheriff Appeal Court’s judgment in John Gray v Roderick John MacNeil ([2017] SAC (Civ) 9) had all the characteristics of an episode of Broadchurch, but with more legal twists.

Mr Gray had a verbal agreement with his father-in-law, the now-deceased Mr McNeil, that Mr Gray would lease the chip shop from McNeil’s petrol station with an agreed rent from 2005 to 2020. However, the relationship between the two men broke down, culminating in Mr McNeil calling his daughter, Mrs Gray, alleging that an unknown woman was staying the night with Mr Gray, leading to Mr Gray confronting Mr McNeil at home, who subsequently switched off the electricity of the chip shop from 20 October 2012, leaving Mr Gray unable to trade.

Mr Gray originally sought damages for loss of profit after the chip shop was forced to cease trading. However, no written lease was ever created over the chip shop. For leases over property for the duration of more than 1 year, a written agreement is required in order to substantiate any real right in the land. As this agreement was never put into writing, the Sheriff found no real right was ever created in favour of Mr Gray in the chip shop.

However, at appeal Mr Gray argued that the verbal agreement constituted a personal obligation between him and the now deceased Mr McNeil (being represented by Mr McNeil’s son, who was acting as Executor Nominate to his father’s estate). Under Section 1(1) of the Requirement of Writing (Scotland) Act 1995, this did not require to be in writing.

While the Respondent (Mr McNeil) submitted that the Appellant (Mr Gray) was now seeking to argue a new case, different from the former case on record dealing with breach of contract, the Appeal Court found that the case was a modification of the original case pled and would not accept that there had been any material difference in the evidence given or the challenge to that evidence. Another argument put forward by the Respondent was their entitlement to sufficient specification so as to prepare their case. Nonetheless, the Appeal Court accepted that fair notice was given of the terms of contract which the appellant claimed had been entered into and breached by the deceased.

The Appeal Court was moved to follow Lord Drummond Young’s Opinion in The Advice Centre for Mortgages v McNicoll:

“the distinction [between the creation of personal rights and the actual creation or transfer of a right] is clearest in the case of missives for the sale of land and the Disposition of land, but exists in other bases, although it becomes very blurred in the case of leases.”

In terms of the real right and land becoming a personal right against the deceased, the Appeal Court agreed with the submission made by the appellant that it was possible for the terms of the verbal agreement to give rise to personal rights and corresponding obligations which in this case had been breached by Mr McNeil. The Sheriff Appeal Court therefore found in favour of the Appellant, Mr Gray and he was awarded the sum of £141,117.

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Jackson Boyd’s Dispute Resolution Team has significant experience in dealing with contractual disputes and can be contacted on 0141 413 9178 or at enquiries@jacksonboyd.co.uk.

Olivia Keenan

Olivia Keenan

Dispute Resolution Team

'The best part of my job is building a relationship with my clients and assisting them through a difficult time, ultimately achieving the best outcome possible for them.'

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