McGraddie v McGraddie and another

An appellate court may reverse a trial judge’s findings of fact only where the judge was plainly wrong. It must respect the trial judge’s advantages in seeing and hearing witnesses, familiarity with the whole case and expertise in fact-finding.

A finding reasonably supported by the evidence as a whole cannot be displaced merely because the appellate court would assess the printed record differently. Intervention is justified where a critical finding lacks evidential support or the trial judge failed to use the advantages of hearing the case. Appellate courts should consider all material evidence and avoid narrow textual analysis of reasons as a basis for substituting their own assessment.

The pursuer transferred money to his son, the first defender, in connection with the purchase of two properties. The first defender took title to the first property in his own name. He and his partner, the second defender, maintained that a later payment of £285,000 was a gift. The pursuer maintained that it was provided to buy a second property for him.

The Lord Ordinary accepted the pursuer’s evidence on the central issue and rejected the defenders’ account: [2009] CSOH 142. He addressed remedies in [2010] CSOH 60. The Extra Division reversed his decision concerning the second property and found that the payment was a gift: [2012] CSIH 23.

The issue before the Supreme Court was whether the Extra Division had failed to follow the proper appellate approach to a trial judge’s findings of fact.

1. Appeal allowed. Lord Reed delivered the Court’s judgment, with which Lord Neuberger, Lady Hale, Lord Wilson and Lord Hughes agreed. An appellate court should disturb a trial judge’s findings of fact only on the rare occasions when it is satisfied that the judge was plainly wrong. The rule reflects more than the trial judge’s advantage in assessing credibility. It also recognises the trial judge’s expertise in fact-finding, familiarity with the whole case and the cost and distortion caused by duplicating the fact-finding exercise on appeal.

2. Where the evidence as a whole can reasonably support the trial conclusion, particularly where credibility was assessed after hearing conflicting testimony, the trial judge’s view carries great weight. The judge is presumed to have considered the whole evidence even where every point is not expressly mentioned. An appellate court should read reasons fairly and resist narrow textual analysis used to justify substituting its own assessment.

3. Intervention remains proper where there is no evidence capable of supporting a critical finding. That circumstance is a question of law. It differed from the present case, in which the Lord Ordinary had considered the points later relied upon by the Extra Division and had nevertheless accepted the pursuer’s evidence.

4. The Extra Division isolated matters adverse to the pursuer without giving proper weight to the evidence as a whole. In particular, it did not adequately account for the Lord Ordinary’s assessment of the witnesses’ demeanour and character, his reservations about both defenders, or the first defender’s earlier breach of trust. Some of its factual premises were also insubstantial or inconsistent with the evidence. The credibility question was pre-eminently for the Lord Ordinary.

5. The Extra Division therefore had no proper basis for finding the Lord Ordinary plainly wrong, still less for reaching the opposite conclusion on the whole evidence. The appeal was allowed, with parties invited to address the appropriate form of order.

1. United Kingdom Supreme Court: Allowed the appeal from the Extra Division and invited submissions on the appropriate form of order: [2013] UKSC 58.
2. Extra Division of the Inner House of the Court of Session: Reversed the Lord Ordinary’s conclusion concerning Lochrig Court and held that the £285,000 payment was a gift: [2012] CSIH 23.
3. Outer House of the Court of Session: The Lord Ordinary accepted the pursuer’s account on the substantive issues in [2009] CSOH 142 and addressed remedies in [2010] CSOH 60.