COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM BOW COUNTY COURT
His Honour Judge Hornby
Claim Nos: 6BO01973; 6BO02019; 6BO053728
Strand, London, WC2A 2LL
B e f o r e :
LORD JUSTICE RIMER
LORD JUSTICE SULLIVAN
| (1) RODERICK LEMAS
(2) GEORGE SEALY
|- and -
Mr Abdul Gofur (instructed by Coldham Shield & Mace) for the Respondent
Hearing date: 23 January 2009
Crown Copyright ©
Lord Justice Rimer :
'7. he signed an agreement with Mr Lemas' wife, that if he loaned a certain sum of money to Mrs Lemas, which would prevent the property from being re-possessed by the Abbey, that he would be given a 30 per cent interest in the property, or an increase in the valuation.
8. He said that in due course he provided the sum of £30,000, and that was given to Mrs Lemas, and she was able to pay off the Abbey National. A legal charge was placed on the property .'
'I loaned Ms Lemas £60,000 to pay on her mortgage to Abbey National to prevent her property from being sold. This was for the purpose of recovering her home. I therefore have an interest in the property of £60,000. I paid £20,000 prior to the 24.10.02 and the other £30,000 I paid on the 24.10.02 at an Abbey National Branch in Chingford. I also have £10,000 which I wanted to pay in on the 24.10.02 but the building society limited the amount I could pay in at the time. I am still holding this sum for further payment.'
'The accumulation and maintenance trust will provide for Jessica Lemas to inherit 90% of the trust fund upon her attaining the age of 25 years and for Nathan Lemas to inherit 10% of the trust fund upon attaining the age of 25 years.
I understand that you will not be living at the property. It is intended that your trustees will rent out the property, which will generate income for the trust. Your trustees will be able to advance income from the trust to Jessica and Nathan as and when they see fit for their maintenance, benefit and education. They will also be able to inherit the trust fund upon attaining the age of 25 years, again for their maintenance education and benefit.
I understand that the property was purchased with the financial assistance of your girlfriend. I understand that she is not intended to be registered as a proprietor of the property in terms of the contract for the sale and therefore I understand that the money she paid to you was a gift. If the payment is not a gift but instead your girlfriend intends to obtain an interest in the property, this will have implications in terms of the drafting of this accumulation and maintenance trust. I can not advise your girlfriend in this respect and I must therefore recommend that she obtains independent legal advice in respect of the money she has given to you for the purchase of the property and likewise, whether she should object to you placing the entire property in trust.
Once you have placed the property into the trust you can not retrieve the property from the trust. You have made a gift of the property to the two beneficiaries of the trust, Jessica and Nathan. I understand that you have had to obtain a mortgage from the bank to purchase the property. Please advise me whether the charge is registered against the property to be placed into the trust. If so, please advise how it is intended for the mortgage to continue to be paid. If you are to continue to pay the mortgage on the property I would suggest that a further agreement is drafted ancillary to the trust document which confirms that you are agreeable to settling the mortgage, but at the same time will make no claim on the property. The debt, as a result will remain a liability of your estate. You have instructed me solely to draft the trust document.
I would advise that you contact your mortgagees to ensure that they are agreeable to the property being placed in trust but for your name to remain on the mortgage documents. The Trust document will need to be registered at the Land Registry, which will show the Trustees of the trust as the legal proprietors of the property and not you. Your name can not remain on the title documents .
Finally, I have drafted the accumulation and maintenance trust and this will be discussed in our meeting today at 12 noon. I advise you to take financial advice in terms of placing the property into trust. I have not provided you with tax advice in respect of the drafting of the trust. I can provide you with tax advice. ..."
'Unless the First, Second, Third and Fourth Defendant file and serve a defence by no later than 4 pm on 30th October 2006, each or all of them shall be debarred from defending.'
The order gave directions for trial, including disclosure by 4 December 2006 and exchange of witness statements by 15 December 2006. The amended Particulars were to be served by the court and Mr Williams gave the judge Mr Sealy's correct address for service, 563 Eastern Avenue, Ilford, with the judge advising Mr Williams that 'You must arrange with the clerk, make sure she has got the right addresses.' Mr Lemas told the judge that 563 Eastern Avenue was also his address for service; and Mr Williams pointed out to the judge the fact of the common address. On about 10 October 2006 Mr Williams filed amended Particulars of Claim, naming Mr Sealy as the fourth defendant.
' entitled to occupation given us by the trustee of [the trust deed]. Under the terms of that Trust Mr Williams placed [the house], into that trust to be administered by the trustees. Part of that administration is the authority to rent it out to whoever they please. The situation is no different to a registered owner transferring authority to a letting agent who rents out the property. The owner cannot simply later change his mind and call the occupiers trespassers in an attempt to get possession.'
Mr Lemas produced the trust deed to the court on 15 August 2007, the second day of the trial.
The judge's judgment
' I invited Mr Lemas to continue his evidence and he indicated to me that he had been advised not to give evidence. I am bound to say I was somewhat surprised by this turn of events because Mr Lemas had appeared perfectly at ease giving his evidence. So it was something of a surprise to find that he no longer wished to give evidence. It seemed to me that a person is entitled, if they do not want to give evidence, not to give evidence, and the court can not force an individual to give evidence if they do not wish to. I explained very carefully to Mr Lemas that the court would obviously encounter some difficulties because he could not be cross-examined and his evidence would not be tested. It might be a disadvantage to him, and he would not be able to introduce other documents that I was aware he had brought with him and was wanting to introduce. I told him that if he wanted to introduce those documents he would have to introduce them in evidence. Mr Lemas was adamant that he would not give evidence, and so the only evidence I have heard from him is his confirmation of the documents which are in the trial bundle.'
'The difficulty that the court found was that it seemed that Mr Lemas was not interested in putting what his case was, but was interested in making Mr Williams repeat the evidence that he had already given ad nauseam. I had to intervene on a number of occasions, trying to encourage Mr Lemas to actually put his case, but doggedly Mr Lemas did not want to do that. One would have been here for many hours. Indeed, I suspect that if Mr Lemas had decided to give evidence and introduced all the documents that he brought to court today, which he could have sought to have done if he wanted to. I made it clear to Mr Lemas that I would hear his evidence if he wished to give evidence, and that it would have been much longer if he wanted to produce the documents, I would consider them and give Mr Gofur the chance to go through them. If he had wished, he would have been able to give his evidence throughout the whole of this afternoon but he decided not to and there it is.'
Mr Lemas's application for permission to appeal
'MR LEMAS: Your honour, you said something you did not make it clear to me that had I taken the stand I could have had my bundle admitted. My understanding was you were deciding
THE JUDGE: I made it very clear to you, Mr Lemas. I actually repeated over and over again what the position was, and I am not going into it once more. I actually positively encouraged you to give evidence on a large number of occasions.
MR LEMAS: You did encourage me to take the stand, your honour, but you did not say
THE JUDGE: Let us not go into it any further.
MR LEMAS: [inaudible]'
Mr Sealy's application for permission to appeal
'I have never been served with any papers on this matter or property by Mr Williams or any representative of his. I am told by Mr Lemas, that Mr Williams believed him to be me or my name being an alias used by him. I have now seen some papers received by Mr Lemas from Mr Williams, all of which refer to him as Mr Lemas aka G. Sealy. I am also told and have seen court transcripts and Witness Statements in which Mr Williams always maintain [sic] this delusion. I have also never played any part in this action. It appears Mr Williams added my name at a later stage to cover himself believing Mr Lemas to have two names.' (Emphasis supplied)
'If the court is not minded to strike out the matter, we would respectfully request an adjournment to enable us to take instructions, respond on our client's behalf to the claim and make adequate arrangements and preparation for future hearing. Further and especially, our client requests that the validity of the trust document be settled before any order for change of possession is made.'
Lord Justice Sullivan :
Lord Justice Mummery :