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Elaine Samuel, School of Social and Political Studies, University of Edinburgh
ISBN 0 7559 2758 3
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Following the introduction of new rules for commercial actions in the Sheriff Court in 2001, commercial procedure was commenced in Glasgow Sheriff Court. Research was undertaken to examine the operation of the Commercial Court in Glasgow, describing the procedural, practical, and cultural innovations introduced by the commencement of commercial procedure, and examining its impact on key stakeholders. The research was undertaken with a view to informing the Sheriff Court Rules Council as to the advisability of adopting commercial procedure as a model for all ordinary cause proceedings in Scotland.

Main Findings

• The number of actions raised in Glasgow Sheriff Commercial Court was found to have increased over time, as more firms became alert to the opportunities that commercial procedure presented.
• The continuity of designated commercial sheriffs with specialist knowledge throughout the proceedings played a pivotal role in achieving speedy disposals, as did their robust case management. This was made possible by the Case Management Conference, which amongst other things provided sheriffs with the opportunity to focus the issues at an early stage. The involvement of principal solicitors in key stages of cases also played a crucial role in commercial procedure and was made possible by the use of telephone conferencing and e-mail, in place of court appearances. IT was seen to play a key role in facilitating the functioning of the unique procedures and practices of the Commercial Court.
• Commercial procedure was seen as responsible for changing and improving many aspects of litigation culture in the Sheriff Court and for introducing efficiencies both into the court and into legal practice. The Commercial Court was seen as a court orientated towards the needs of the commercial world and taking a 'business-like' approach to procedure.
• While the Commercial Court was seen by many to be a pursuer's court, all those vulnerable to delay, including defenders, were thought to benefit from it. Pursuers reported that cases settled earlier, or were resolved quicker, in the Commercial Court, and at a lower cost to their clients.
• Practitioners were reluctant to see commercial procedure rolled out so as to include all ordinary actions, though they recommended that it be extended in certain respects. The success of the Commercial Court was regarded as dependent on the organisational structure in which its culture and practices were embedded. Conformity with the expectations of the court was high. This was thought unlikely to survive should the organisational structure of the Commercial Court be dismantled in order to include all ordinary cause actions.

Background to the study

Following the successful introduction of new rules for commercial procedure in the Court of Session in 1994 ¹, new rules for commercial actions were introduced into the Sheriff Court in 2001. They were first made available in Glasgow Sheriff Court in March 2001 ² by direction of the Sheriff Principal of Glasgow and Strathkelvin. The Sheriff Court rules for commercial procedure were subsequently commenced in Jedburgh, Selkirk and Duns Sheriff Courts and in Aberdeen Sheriff Court (in August 2004).

New rules for ordinary procedure had been introduced into the Sheriff Court in 1994 and were targeted primarily at delays and excessive callings during the adjustment period ³. On completion of adjustments, actions called in court for the first time at an Options Hearing, at which sheriffs were required to expedite the progress of actions through the court. Several problems were subsequently observed ⁴: it was difficult for the court to take control of cases when callings were kept to a minimum; in the busiest courts, the number of cases coming before the bench at Options Hearings did not permit in-depth clarification of the issues in dispute; principal solicitors began to absent themselves from attending Options Hearings and instructed agents in their place; and the lack of continuity between sheriffs in the larger courts did not promote the expeditious progress of actions through the court.

The new rules for commercial procedure in the Sheriff Court (Chapter 40), which were introduced in 2001, were designed to address some of these problems. They were intended to be broad in scope by allowing designated sheriffs to make any orders that would progress the case. The rules expedited early identification of issues by requiring pursuers and defenders to lodge with the writ or the defences a list of documents to be founded on. They expedited progress of the case through the court by requiring defences to be lodged within 7 days of expiry of the period of notice, by then allocating them to a designated commercial sheriff and calling a case management conference within 28 days, and by providing sheriffs with wide case-management powers. They gave parties the right to make an election for commercial procedure, which could deal with any business or commercial dispute, whether raised or defended by individuals, business or government.

Study findings

Raising actions in Glasgow Sheriff Commercial Court

Decisions to nominate actions for commercial procedure were mainly found to have been taken by individual solicitors and firms, rather than their clients. Solicitors were more likely to elect commercial procedure for actions that were complex, contentious, and involved higher value claims, and for clients who had a particular need for a speedy determination. The bulk processing of some firms' debt recovery business accounted for many of the actions that, though qualifying for commercial procedure, remained in the Ordinary Court. Some firms, however, were found to be very alert to the opportunities presented by the new commercial rules and raised all of their qualifying actions under commercial procedure when jurisdiction could be found in Glasgow Sheriff Court.

Proceedings and procedural innovations in the Commercial Court

Actions raised under commercial procedure and subsequently defended were concluded in 26 weeks, on average. Only 16% took more than nine months from notification of intention to defend until their disposal, and none took more than 18 months. Debates were less likely to be fixed under commercial procedure, though there was little difference between ordinary and commercial procedure with regards to the fixing of proof diets. However, proofs and debates fixed under commercial procedure were more likely to be heard and if they were cancelled, this was less likely to be on the day. Commercial procedure actions were more likely to be disposed of 'informally', that is, not through a court order.

The commercial bench was responsible for introducing a commitment to pragmatism and transparency in the Sheriff Court, a culture oriented to the needs of the commercial world and a consensual approach to procedure. The designated commercial sheriffs introduced procedural innovations that were designed to focus issues clearly at earlier procedural stages and they used their powers to drive actions towards an early settlement or a speedy and economic conclusion. Principal solicitors had direct access to the designated sheriffs, and were involved in proceedings at every stage. The Commercial Court required speed, energy and flexibility of approach from its participating solicitors, and conformity to its expectations appeared to be high.

The impact of the Commercial Court

Shrieval continuity and expertise were responsible for promoting efficiency in the Sheriff Court, as was the commitment of designated commercial sheriffs to proportionate justice and the flexibility with which commercial procedure allowed them to organise their workload. The participation of principal solicitors throughout all stages of court proceedings contributed to the efficiency of the Sheriff Court by expediting actions through the court.

Solicitors for pursuers reported that cases settled earlier, or were resolved quicker, in the Commercial Court and at a lower cost to their clients. Solicitors for defenders reported that they were put under considerable pressure, which they found to be particularly difficult when information or instructions from their clients were not forthcoming. A few solicitors found some problems in accommodating to the consensual approach adopted by the Commercial Court. Though the Commercial Court demanded the participation of principal solicitors, it allowed them to organise their work more efficiently and this contributed to their profitability and competitiveness in the marketplace.

There appeared to be a good 'fit' between commercial procedure and those litigants using it: commercial procedure was decisive, fast, geared to settlement and was low cost. This was not only of benefit to pursuers but also vulnerable defenders. Litigants were pleased with commercial procedure for several reasons; for the continuity of their solicitor's service and the continuity of the bench throughout proceedings in court; for the commercial expertise on the bench and its accessibility; and for the speed with which justice was delivered.

Extending commercial procedure

Given the support of practitioners for commercial procedure, they might have been expected to recommend its roll-out to all ordinary cause actions. This was not the case. Many recommended that the Commercial Court be extended in some form. Some suggested that specific areas of work, such as corporate insolvency, should be included in the remit of designated commercial sheriffs. Some suggested that other actions, such as personal injury and damages, would also benefit from a specialist court with case management powers in the Sheriff Court.

Many wished to see commercial procedure commenced in other Sheriffdoms and Sheriff Courts. Many identified specific procedures and practices of the Commercial Court that could be extended to all Sheriff Court business, such as the allocation of all cases of some complexity to shrieval case management. There was a strong call to extend the use of e-mail and telephone conferencing.

However, there was almost universal resistance to the idea of rolling out commercial procedure to all ordinary actions. The success of the Commercial Court was thought to be dependent upon the authority commanded by the designated sheriffs in their particular area of expertise, the participation of principal solicitors, and the nurturing of their professional credibility and responsibility to the Court. The Commercial Court was driven by a culture and practices that were embedded in its organisational structure. These were seen as most unlikely to survive the incorporation of all ordinary cause actions within its remit.

About the study

The research was commissioned by the Scottish Executive Legal Studies Research Team and was conducted by Elaine Samuel at the School for Social and Political Studies, University of Edinburgh, between October 2002 and June 2004.

Four main sources of data were used to inform the research and evaluation. Extensive information was collected from the Sheriff Court Management System ( CMS) on all 1265 actions raised under commercial procedure in Glasgow Sheriff Court between March 2001 and November 2002 and from the Court of Session Management System on actions raised under commercial procedure in the Court of Session between January 2000 and November 2002. Information was also taken directly from over 200 court processes in two samples of defended actions raised under ordinary and commercial procedure in Glasgow Sheriff Court. Finally, 28 interviews were conducted between January and June 2004 with commercial court practitioners and users, including sheriffs, clerks of court, solicitors and litigants.

1 Statutory Instrument 1994 No. 2310 (S.112) Act of Sederunt (Rules of the Court of Session 1994 Amendment No.1) (Commercial Actions)

2 Chapter 40 Commercial Actions was inserted by Act of Sederunt (Ordinary Cause Rules) Amendment (Commercial Actions) 2001 (S.S.I 2001 No.8)

3 Act of Sederunt (Sheriff Court Ordinary Cause Rules) 1993 S.I. 1993 No. 1956

4 See, for example, Elaine Samuel and Robert Bell (1997), Defended Ordinary Actions in the Sheriff Court: Implementing O.C.R.(93), Scottish Office Home Department, Central Research Unit
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