Representations by a solicitor of authority to settle an action can be relied on by the other side even where the solicitor had no actual authority to do so, the Inner House has ruled.
The court refused an appeal by Stanley Mazur in his action against Primrose & Gordon, solicitors, which he claimed had been settled without his authority and against his express instructions by his then solicitor, Hugh Grant of Grant Brown Lindsay, Glasgow.
Mr Mazur had instructed Mr Grant to raise proceedings against the defenders, alleging negligent advice that had led to him allowing himself to be sequestrated when he was sued for a debt of £2,300. He claimed loss and damage totalling £40,000. The defenders tendered £10,000 plus expenses, which Mr Grant advised him to accept. Mr Mazur twice declined to accept, but after telephoning Mr Mazur's home Mr Grant persuaded Mr Mazur's wife, when Mr Mazur was unavailable, to accept the offer. Only after a joint minute had been executed by Mr Grant did Mr Mazur attempt to cancel the settlement.
At first instance the sheriff expressed surprise at Mr Grant's actions, and said that Mr Mazur appeared to have a claim against him, but held that the defenders were entitled to take the view, on the communications received, that the action was settled and Mr Mazur was barred from re-raising it. The sheriff principal agreed and Mr Mazur appealed to the Court of Session.
Delivering the opinion of the court, Lord Menzies, who sat with Lord Drummond Young and Sheriff Principal Derek Pyle, said it appeared that Mr Mazur had not been well served by successive legal advisers, but "we are clearly of the view that his remedy for this does not lie in the present proceedings". There was clear authority that, and sound policy reasons why, a party to litigation was entitled to rely on the ostensible authority of the solicitor acting for the opposite party to compromise an action.
There were no averments to support an allegation of fraud, and there had been no infringement of Mr Mazur's right under article 6 of the European Convention to a fair and public hearing of his claim. Lord Menzies commented: "On the basis of the sheriff’s findings, it appears that settlement on this basis was not in accordance with Mr Mazur’s clear instructions. If that is so, he may have a remedy against Mr Grant. In order to obtain that remedy, no doubt he will require to satisfy the court that his original claim against the present respondents was well founded and, if it had proceeded to proof, would have been likely to result in an award of damages greater than the sum achieved at settlement. Mr Mazur will therefore have the opportunity to make his case, and to have a public and fair hearing."