Pursuer Brian McCardle raised the action against defender Gerald Grady for £12,000 plus further sums for other work carried out on his property in advance of its sale in 2022. The defender maintained that no sum was due, or alternatively that the parties’ agreement was unenforceable due to being undertaken as part of a benefits fraud.

The case was heard by Sheriff David Taylor at Glasgow Sheriff Court.

Inconsistent and incredible

In 2017, the pursuer was approached by the defender’s brother in connection with concerns he had about the condition of the defender’s home at Dowanside Road in Glasgow. The pursuer met the defender and agreed to instruct a survey, which recommended that work be carried out to address a rot issue. This work was communal to the properties owned by the defender and his neighbour, James Renwick, and after it was finished the parties agreed a total price for the work of £18,000, of which one third would be paid by Mr Renwick.

The defender did not pay his agreed share of £12,000 to the pursuer. In 2022, the pursuer was again approached by the defender’s brother asking him to help with the marketing and sale of the defender’s home. He agreed to do this on the basis that he was paid the outstanding sum, however despite the property selling for just over £1.1 million, he did not do so.

In his evidence, the defender testified that the pursuer was initially asked to decorate three upstairs bedrooms at the property and do some minor electrical work. He maintained that he had not been provided with any documentation to vouch for the communal rot work, and that was why he had not made payment to the pursuer.

For the pursuer it was submitted that the defender’s evidence was inconsistent and incredible in respect of the scope of the work carried out. There was evidence that a guarantee had been issued by Sovereign Chemicals Ltd, for whom the pursuer was a licensed contractor. In respect of the additional work he had performed in 2022, no price was agreed, so the pursuer was entitled to remuneration on a quantum meruit basis.

The defender further argued that the contract between himself and the pursuer was a pactum illicitum and thus unenforceable. The basis of this submission was that the pursuer was claiming benefits while being paid for work carried out at the defender’s property. In response, the pursuer submitted that there was no evidence of him receiving benefits illegally, and in the absence of payment from the defender the pursuer had no earnings to declare to the DWP.

Contracts for smuggling

In his decision, Sheriff Taylor began by assessing the credibility of the parties: “Overall I consider that the pursuer gave a consistent account of the scope of the communal work and of the agreement which he reached with the defender to carry out the work. In contrast to the pursuer’s evidence on the communal work issue there were a number of inconsistencies in the defender’s evidence about this matter. The most significant of these concerned Mr Renwick’s payment of £6,000 to the defender. The defender was unable to give a coherent explanation of why he asked Mr Renwick for £6,000 if, as he claimed, there was never any agreement on a price of £18,000.”

He continued: “The defender’s evidence that the pursuer quoted an initial price for the communal work of £9,000 and then an increased price of £18,000 a week later did not ring true. Initially he testified that the pursuer asked Mr Renwick to pay him £6,000. That was untrue. He was at times prone to go off on a tangent in his answers to questions. For example, early in his examination in chief the defender spoke at length about an embezzlement case which he claimed the pursuer was involved in. There was no reference to any embezzlement case in the defender’s pleadings.”

Addressing the claim of pactum illicitum, Sheriff Taylor noted: “The sentence from Gloag on Contract founded upon by the defender that ‘Contracts to evade the revenue laws are illegal’ does not assist his pactum illicitum argument. The sentence appears in a passage with the heading ‘Smuggling’. The discussion in the passage is about contracts entered into for the purposes of smuggling or evading the revenue laws.”

He added: “The error in the defender’s analysis is demonstrated by his averments [that] ‘esto the pursuer’s right to payment has not been extinguished, the pursuer has a reasonable concern that performance of that obligation would facilitate benefit fraud and make him an accessory thereto’. No authority was cited for the proposition advanced in these averments. In short, the defender’s concern that the pursuer was claiming benefits illegally is not a sufficient basis for treating one or more of the contracts entered into as a pactum illicitum.”

Sheriff Taylor therefore found that the pursuer was entitled to payment in respect of the defender’s share of the communal work and additional payments for later work, and awarded him the sum of £17,575.