England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE CHESTER COUNTY COURT
(Mr Justice Thomas)

		Royal Courts of Justice Strand London WC2 Monday, 18th June 2001

Monday, 18th June 2001

1. LORD JUSTICE KAY: This is an application for permission to appeal against a decision of Thomas J on 12th March 2001, sitting at Chester, when he dismissed an appeal from a decision of Deputy District Judge Stephens given in the Wrexham District Registry on 13th July 2000. It is, therefore, an application to bring a second appeal.
2. The defendant, Thomas Roy Smith, acquired an Elizabethan property called Althrey Hall, Bangor on Dee, in Clwyd. It was an historically significant part-timbered building. In 1987 some Tudor murals were discovered. The body responsible for conservation in Wales, CADW, became interested and discussions took place. Beginning in 1987 a series of grants were made to him under the Historic Building and Ancient Monuments Act 1953 (as amended). The first two of these grants were made on the basis that any recovery of the grant would be limited to a period of five years. No claim has in fact been made in respect of those two grants.
3. In 1990 a third phase of the grant was made to him. The terms were set out in conditions contained in a letter dated 26th October 1990. These included as condition (1) that, in the event of the sale of the property within a period of 10 years from the date the grant is offered, the owner shall immediately notify the Secretary of State. There was then an explanatory note which said,

"A.If any of the above conditions is contravened or not complied with the Secretary of State may at any time recover from you the whole of the grant or such part of it as he thinks fit (in accordance with section 4A of the 1953 Act, as enacted by the Ancient Monuments and Archaeological Areas Act 1979).

B.Under the provisions of section 4A, the Secretary of State may also recover the whole or any part of the grant if, during the period of 10 years beginning with the day on which the grant is made, you dispose of the property, or any part of it, by way of sale, exchange or lease for a term of 21 years or more."

4. Three further phases of the grant were made, to which the same conditions were attached, in 1991, 1992 and 1993.
5. The defendant did undertake a great deal of work on the property to rescue this important building from its then dilapidated condition. By November 1997 the financial situation of the defendant, who ran not only this property but two other properties, had deteriorated, and he took the decision that he was going to sell this property.
6. On 19th November 1997 he advised CADW of his intention. There was a note of his telephone conversation which showed he had raised the issue of grant recovery. He was advised to write in and they would advise him as to the position. At the end of November he did indeed write an undated letter, explaining that he was selling the house because he was finding it difficult to cope financially. CADW replied by a letter dated 3rd December 1997, saying it was a standard condition of the grant that, if a property was disposed of within 10 years, the Secretary of State might recover the whole or part of the grant. He was advised that each case was considered on its merits and that it would require the details to be considered and then they would write to him again.
7. By a letter that the judge attached considerable significance to, dated 11th March 1998, CADW set out the position. They said:

"From my records it would appear that the recovery period in respect of the first two phases of work has expired. With regard to the later phases the relevant dates are...."

and then those dates were set out,

"Each case is considered on its own merits and therefore I am unable to confirm whether or not recovery action will be taken. If it is, it is likely that the amount recoverable will be calculated on a pro-rata basis, dependant on the proportion of the recovery period remaining at the time of the sale.

I understand the property is still up for sale and I should be grateful if you could keep me informed as to any developments. The question of recovery can then be considered once a sale has been negotiated.

If I can be of further assistance in this matter please do not hesitate to contact me."

8. The judge concluded that this letter, taken with the clear conditions, made it absolutely clear what the position was.
9. The letter coincided with a potential sale of the property. However, that sale fell through. On 28th May 1998 CADW wrote again asking to be advised as to the current position. They had no response.
10. On 15th September 1998 the defendant was advised that an offer had been made to purchase the property for £250,000, and he agreed to sell. This sale price was sufficient to cover the defendant's borrowing from the bank but insufficient to cover his total outlay on the property, which was of the order of £400,000. The defendant took no steps at all to notify CADW of the sale.
11. On 18th May 1999 someone on behalf of CADW visited and found for the first time that it had been sold. He obtained an address for the defendant. On 23rd June 1999 CADW wrote to the defendant at the address that had been given. The letter advised that they would reclaim on a proportionate basis, as indicated in their earlier letter. The total to be repaid was £56,456. Because the address given to CADW was not entirely accurate, the letter was not received by the defendant. When there was no response, CADW issued proceedings on 8th December 1999. The defendant learnt of the proceedings after an attempt to serve the relevant documents at his son's address, and he then for the first time rang CADW.
12. The defendant contacted solicitors, and, for reasons which the judge concluded were not readily discernable, the solicitors allowed judgment in default of defence to be entered. The defendant applied to the District Judge to set aside the judgment. That application was refused. He then appealed, and it was the decision of Thomas J on that appeal that leads to this application.
13. The matters which the defendant wished to raise by way of defence were, first, that before the decision was made to recover part of the grant he should have been entitled make representation. Second, that since CADW had knowledge of his financial hardship and the fact that he had done the work and tried to make the premises available for public access, those factors should have been taken into account in the making of the decision. The third issue related to a letter written on 18th November 1992 which contained the following passage:

"I have spoken to colleagues and would respectfully suggest that for the purpose of calculating grant payments, the cost of the works on phases I, II, III, and IV are amalgamated, as well as the grant offers made. This would enable us to utilise the unspent grant monies and issue further payments to you for works carried out on phase IV."

14. It is submitted that the effect of that amalgamation was to remove from each of the grants, two of which were subject to a different period during which recovery could take place, any condition permitting recovery.
15. The judge's conclusions in relation to those matters were set out in his detailed and careful judgment. He considered first the question of representations and concluded in respect of those that the relevant issue to be decided was one as to whether in the circumstances of the case there was an obligation to do more than had been done in seeking representations. He concluded that that was a question to which the answer was clearly "No". His view was that the letter of 11th March 1998 had made perfectly clear to the claimant that, if he wished to raise any matter, it was for him to put it forward. He had not done so. Indeed, he had not even notified them of the sale. In those circumstances he could not complain that he had been denied any chance to put forward representations. Added to the argument in relation to that point was a further argument that even after proceedings had been started, when solicitors did make representations, they should have been considered at that stage. The judge's view in respect of that was that there was a proper basis upon which the claimant had refused to do that, namely that there was a need for finality in such matters, and, bearing in mind the time that had elapsed, they were entitled to take the stand that they did.
16. As to the second point, the taking into account of the various factors which it was said were known to them in any event, the judge concluded that there was no evidence upon which he could come to a conclusion that they had not considered such matters. Mr Hill has sought today to explain to us what that evidence was and has pointed to various passages in the correspondence from which, he says, it is possible to draw an inference that those factors had never been taken into account. With great respect to his arguments, none of those passages, it appears to me, permit the drawing of the inference that is sought. It is submitted that, in any event, CADW had not put forward any evidence before the judge to show that they had in fact considered those matters. The judge's conclusion, as indicated in relation to those various questions, was simply that there was no basis upon which the inference suggested could be drawn.
17. As to the third point, the judge rejected that in fairly short terms. He said that it was not capable of belief that either party thought that the result of the amalgamation would be to remove those terms that had been clearly set out in letters.
18. The matter came before Latham LJ on the papers. His reasons were given in short form, and I repeat them in full because they coincide very much with my own:

"The letter of the 11th March 1998 set out the claimant's position fully and fairly. It was for the applicant to keep the claimants informed. He had the onus of both keeping in contact, and making such representations as he wished bearing in mind the stated basis upon which the claimants would otherwise calculate any repayment. There is no material upon which it could properly be said that the decision to make the claim failed to take into account material considerations, bearing in mind that it was for the applicant to make any representations which he considered appropriate; he had a legitimate expectation that such representations would be considered before any decision was made, provided always that he had made those representations. He did not. I do not consider that there is any basis for saying that the claimants acted irrationally in pursuing the claim after contact had been made with the applicant. No important point of principle or practice arises and there is no other compelling reason for the Court of Appeal to hear this case."

19. I agree, as indicated, entirely with the conclusions that Latham LJ reached. Nothing that has been advanced, either in the very detailed skeleton argument made available to this court or by Mr Hill orally, in any way causes me to reach a different view.
20. So far as the last point is concerned, which Latham LJ did not specifically deal with, I take the view that the judge was entirely right in his conclusions about the use of the word "amalgamation" and that that is a point wholly devoid of merit.
21. For those reasons, I do not consider that an appeal stands the remotest chance of success and I would refuse permission.
22. LORD JUSTICE KAY: I agree.
Order: Application dismissed.