Introduction

Rutland Court Real Estate (Rutland) v. Anderson Strathern LLP (AS) [2025] CSOH 25 raises important points that should be borne in mind when a third party reporter is appointed to determine questions of fact in litigation and underscores the importance of ensuring a sufficiently wide remit is provided to an appointed reporter.

Background

The action is a dilapidations damages claim raised by Rutland against AS whereby Rutland contends that a substantial office property owned by it in Edinburgh and previously let to AS was not, at the end of the lease, left in a state consistent with due performance of repairing and maintenance obligations under AS's lease.

AS proposed to the court that certain elements of the claim should be remitted to a chartered building surveyor, as a court reporter, for determination. The court were minded to grant AS's request and so the parties agreed the identity of the reporter and terms of their remit. The court amended the remit slightly and the reporter was appointed on 14 October 2024. The joint remit was accompanied by a Schedule of Dilapidations, in the form of a Scott Schedule (Schedule) setting out the parties' respective positions on alleged wants of repair, the appropriate method (if any) of remediation and the cost of any remedial works.

Terms of remit

The key terms of the joint remit can be found in full at pages 2-4 of the judgment, but the remit ultimately directed the reporter to:

1. determine if the wants of repair identified in the Schedule existed at the termination date;
2. if so, whether they breached AS's lease obligations;
3. if the answer to 1 and 2 is yes, whether the remedial works proposed by Rutland were necessary to remedy the want of repair; and
4. if the answer to 1 and 2 is yes, what the reasonable costs for performing the remedial works would be.

The remit also provided the reporter with the ability to interview individuals who, in their opinion, would be able to provide information to assist the reporter in reaching an opinion on the matters remitted to them and required the reporter to include reasons within their report for their decision and, importantly, to ask the court for directions where any party objected to the report or for any other direction the reporter considered they would require.

The report – discussion and objections

Following appointment, the reporter indicated in November 2024 that instructing an independent quantity surveyor on aspects of the mechanical and electrical works would be helpful. The Commercial Court of the Court of Session refused such a request, outlining that the court was required to interpret the remit as agreed, not rewrite it, and the remit did not allow instruction of a third-party expert by the reporter.

The reporter pressed on and, on 10 January 2025, issued their report in draft to the court.

Rutland objected to certain aspects of the draft report. In particular:

• the reporter did not exhaust their jurisdiction under the joint remit and, at best, their report was incomplete. The draft report did not provide any reasonable costs for carrying out some of the remedial works identified in the Schedule to remedy the wants of repair. The reporter merely set out views on a number of items within the Schedule.

For example, the reporter concluded Rutland's proposal to repair the curtain walling was not correct as it did not account for neoprene fins and costs were included without proper justification. Despite setting this out, the reporter did not offer their own opinion on costs within the Schedule.

• separately, certain determinations made by the reporter were illogical and not explained. The draft contained a number of determinations where the reporter did not adopt costings as agreed between the parties without providing any reasons for taking such an approach. Such an approach, it was contended, was illogical, irrational as a matter of law and failed to comply with the reporter's obligation to provide reasons.

The reporter accepted they did not comply with their remit in some respects where pricing had been agreed and should have given reasons to support that (they considered the Schedule had pricing errors). In addition, the reporter suggested that more technical aspects, such as the curtain walling, would best be determined if a specialist contractor was appointed to assist the reporter, which would take some time or, as previously suggested, an independent quantity surveyor be instructed. Rutland, on reflection, was prepared to allow this.

However, AS disputed Rutland's objections. AS concluded that:

• the reporter had not failed to exhaust their jurisdiction. The onus of proving that any wants of repair were a breach of AS's lease obligations, and the costs for remedial works, fell on Rutland and, where Rutland had failed to provide reliable evidence of its reasonable costs for the reporter to consider, the findings of the reporter were a necessary result of that failure;
• following settled Court of Session precedent, objections to a reporter appointed by joint remit were restricted only to the reporter's performance of their duties or to some issue of principle identifiable with the draft report. Neither was present here as, in reality, Rutland's objections stemmed from its own failure to justify its claim;
• any purported agreement between parties on matters such as costs could be ignored by the reporter, who was the final arbiter on questions of fact. The reporter was entitled to identify reasonable costs and they did so – the fact that Rutland was not satisfied by these findings did not amount to a failure on the reporter's part; and
• third-party assistance should not be provided to the reporter. That would go beyond the extent of the joint remit.

Decision

Lord Sandison, having heard the parties' submissions, concluded there were three questions to answer:

1. Had the Reporter's remit been exhausted?

The remit required the reporter to determine whether each want of repair in the Schedule existed at the termination date of the lease (question 1); if it existed at the termination date, whether it was a breach of AS's lease obligations (question 2); if those questions were answered positively, whether Rutland's proposed works were necessary to remedy the breach (question 3); and, again, if questions 1 and 2 were answered positively, what the reasonable costs of performing the necessary remedial works would be (question 4).

Before turning to exhaustion, Lord Sandison noted that, regardless of the answer to question 3, upon questions 1 and 2 being answered positively, an answer to question 4 will always be required.

Lord Sandison thereafter concluded that, where Rutland's criticisms of the report turn on the reporter's failure to answer question 4, despite positively answering questions 1 and 2, the reporter had failed to exhaust their remit. Question 4, in such circumstances, must be answered regardless of the adequacy of the material before the reporter.

2. Can the reporter assign a value to works where the parties have an agreed value?

The fact that the parties had agreed costs amongst themselves does not absolve the reporter from stating their views on costs. The remit substituted the reporter's views for any other views on the remitted questions and so their views are the definitive answers to the questions of fact remitted to the reporter.

In due course, the parties could request the court grant an order reflecting the parties' shared views, not those of the reporter but, until such a request is made, the court is required to consider the reporter's views as definitive answers on questions of fact.

3. Is the reporter entitled to instruct expert assistance to assist with complex issues?

The terms of the joint remit allowed the reporter to interview individuals to obtain the necessary information to provide their opinion, but Lord Sandison concluded this would not extend to the reporter instructing external assistance directly to assist in preparing the report.

However, if the reporter considered asking the parties to instruct professional advisers to provide material and rationale supporting the parties' approach, which the reporter considered necessary to discharge their functions and report on matters, such a request could be made.

Directions were therefore issued to the reporter in line with the court's conclusion on each question.

Takeaways

The decision is a welcome reminder that, where a reporter is uncertain as to how the terms of a joint remit should be interpreted and applied, the Scottish courts will provide appropriate guidance and assistance to the reporter to understand the terms of the remit, so that questions of fact remitted to the reporter can be definitively answered.

Where parties to a litigation consider the appointment of a reporter would be beneficial, parties to a litigation should:

• focus from the outset on identifying whether any reporter to be appointed envisages they will require further assistance to answer questions remitted to them; and
• if such assistance is contemplated, parties should ensure that the reporter's remit is sufficiently wide to provide the reporter with the powers to engage such assistance and effectively discharge their duties with minimal intervention from the parties or the court.