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 CHANCERY DIVISION IN BANKRUPTCY
(Mr Justice Neuberger)

		Royal Courts of Justice Strand London WC2 Friday, 16th November 2001

Friday, 16th November 2001

1. LORD JUSTICE CHADWICK: The application listed for hearing is an application for permission to appeal against an order made on 8th May 2001 by Neuberger J on an appeal from Mr Registrar James in proceedings brought by Mr Michael Stevenson, as trustee in the bankruptcy of Mr Krishnan Kumara Arora, against Mr Arora and his wife Mrs Vijay Arora. The judge dismissed the appeal and confirmed the order which had been made by the Registrar on 20th February 2001 - save that he extended time for complying with that order by one month. The judge refused leave to appeal.
2. An appellants' notice was filed on 21st June 2001 on behalf of both Mr and Mrs Arora. Mr Arora has, it seems, subsequently been made the subject of an order under section 42 of the Supreme Court Act 1981. In those circumstances his application for permission to appeal against Neuberger J's order cannot proceed without leave of a judge of the High Court. So far as I am aware no such leave has been obtained. In those circumstances the only application before the court is Mrs Arora's application for permission to appeal against the order of May 2001.
3. Mrs Arora is not in court to make her application. It is necessary that I should refer to the circumstances in which that position arises.
4. On 14th November 2001, that is to say two days ago, Mrs Arora wrote to the court a letter in these terms:

"1.Mr Arora has made an application to the High Court for Leave to proceed with his permission to appeal application reference B2/2001/1366. [That is the reference of this application]

2.In the circumstances please adjourn the hearing of my application on 16 November 2001 to a date after the result of his application in the High Court is known so that both of us are heard together as originally intended when the application was made.

3.As this matter is very urgent, your reply by return fax ... shall be very much appreciated."

5. What that letter does not disclose is when Mr Arora made application to the High Court for leave under section 42 of the Supreme Court Act 1981; whether that application has been determined; nor (if so) what has been the fate of that application.
6. That request for an adjournment was referred to me as the Lord Justice listed to hear this appeal. On considering the papers, it became clear that Judge LJ had directed on 10th October 2002 that Mrs Arora's application for permission to appeal from the order of Neuberger J should be relisted as soon as possible. In the light of that direction and for the reason that, intrinsically, this is an application which needs to be heard as soon as possible - for reasons which I shall explain in due course - I directed that the application for an adjournment should be refused and the hearing listed for today should take place. That direction was given on 15th November, which was the date on which, according to the received date stamp affixed by the Civil Appeals Office Mrs Arora's letter of 14th November 2001 was received.
7. My direction was communicated to Mrs Arora by fax. Immediately thereafter, a telephone call was received by the Civil Appeals Office, to the effect that she had been in bed with influenza for several days and would not be able to attend. If, indeed, Mrs Arora had been in bed with influenza for several days, it is surprising that no mention of that is made in the letter of 14th November which requested an adjournment on quite different grounds. In those circumstances, I took the view that an adjournment should not be granted without sight of a medical certificate. I directed also that no adjournment would be granted without sight of a medical certificate which explained how it was that Mrs Arora could attend surgery (if that be the case) but not attend court for a half-hour application, and when it would be that she would be sufficiently well to attend court. That information was passed to her by the Court of Appeal Office.
8. On that information being conveyed to Mrs Arora, her response was that no medical certificate could be obtained that day because the doctor's surgery was shut on Thursday afternoon. That information is contained in a letter of 15th November faxed to the Civil Appeals Office. The letter reads:

"1.... . Since it is Thursday and Surgery is open only for half a day on Thursdays, no doctor was available to give me the medical certificate today. The Receptionist at the surgery promised that the medical certificate will be ready tomorrow morning. I shall send the same by fax to you tomorrow morning.

2.On the basis of this undertaking, I hope you shall be able to take the case off the hearing list of 16 November 2001, as you already know per my earlier telephone conversation that I have been ill and that I shall not be able to attend the court."

9. In the light of that letter, it was something of a surprise to find that a certificate dated 15th November - the day on which the surgery was said to be shut - was then faxed to the court at 8.50 this morning under cover of a letter dated 16th November.
10. That certificate did not meet the requirements of my earlier direction; indeed, it did not appear from the certificate that Mrs Arora had been examined by a doctor. That request for an adjournment was refused. The response to that was a further fax message from Mrs Arora which consisted of the Court of Appeal's letter of 16th November to her, refusing her request for an adjournment, endorsed in manuscript with the following:

"Dear Sir/Madam

Re Vijay Arora

The above patient attended the surgery this morning with signs of maxillary sinusitis. She has been unwell for 2 weeks with a flu-like illness and currently has a temperature.

I have started her on Amoxycillin for the next week."

11. The signature on that copy is not capable of being read, but there is a practice stamp of the "Mansell Road Practice". What the doctor does not say is whether Mrs Arora is fit to attend court, nor whether, if she is not fit to attend court, when she will be fit to do so. That was not a certificate which complied with requirements that Mrs Arora had been informed were needed to satisfy the court that this was a proper case in which to grant an adjournment.
12. The adjournment having been refused, a further letter was faxed to the Civil Appeals Office at 13.58. The letter was handed to me during the course of the afternoon's work. The letter was in these terms:
13. "1.Further to my 2nd letter dated 16 November 2001, I say that I am weak, I am dizzy, besides flu, I have a bad attack of asthma, I am in no fit state to attend today. It has been" [then the words cannot be read] "process to attend the doctor's surgery which is only a few houses away. I do not want to go to the doctors. I simply wanted to stay in bed."
14. It is in those circumstances that Mrs Arora is not here. It is impossible to know from that material, particularly having regard to the history which I have recounted, whether Mrs Arora is not here because she really is too ill to be here; or whether she is not here because she chooses not to be here.
15. In other circumstances I would have thought it right to give Mrs Arora the benefit of the doubt, and to adjourn this matter so that she could have an opportunity to attend; not because I am persuaded that she cannot be here but because there is some doubt about the matter and she should have the benefit of that doubt. However, in the particular circumstances of this case it seems to me right to deal in substance with the application that is before me.
16. Mr Arora was adjudicated bankrupt in April 1999. He is registered at Her Majesty's Land Registry as the owner of property known as 91 Portland Crescent, Greenford, Middlesex. There is nothing on the register to suggest that the property is held upon a trust for sale or that Mr Arora is not the absolute beneficial owner of that property.
17. These proceedings are brought by the trustee in bankruptcy for an order under section 335A of the Insolvency Act 1986. The section is in these terms:

"(1)Any application by a trustee of a bankrupt's estate under section 14 of the Trusts of Land and Appointment of Trustees Act 1996 (powers of the court in relation to trusts of land) for an order under that section for the sale of the land shall be made to the court having jurisdiction in relation to the bankruptcy:

(2)On such an application the court shall make such order as it thinks just and reasonable having regard to-

(a)the interests of the bankrupt's creditors;

(b)where the application is made in respect of land which includes a dwelling which is or has been the home of the bankrupt or the bankrupt's spouse or former spouse-

(i)the conduct of the spouse or former spouse, so far as contributing to the bankruptcy,

(ii)the needs and financial resources of the spouse or former spouse, and

(iii)the needs of any children; and

(c)all the circumstances of the case other than the needs of the bankrupt.

(3)Where such an application is made after the end of the period of one year beginning with the first vesting under Chapter IV of this Part of the bankrupt's estate in a trustee, the court shall assume, unless the circumstances of the case are exceptional, that the interests of the bankrupt's creditors outweigh all other considerations."

18. Section 336 addresses the rights of occupation of a bankrupt's spouse; and section 337 with the bankrupt's own rights of application. Mrs Arora has asserted a 50% interest in the property.
19. The application under section 335A of the Insolvency Act 1986 came before Mr Registrar James. He heard the application with evidence. In what Neuberger J was later to describe as an impeccable judgment, Mr Registrar James came to the conclusion that there was no material to support Mrs Arora's contention that she had a beneficial interest in the property and that in all the circumstances - including account being taken of the needs of a 15 year old child of the family - this was a case in which an order for sale should be made. Accordingly, Mr Registrar James declared that the entire beneficial interest in the property was, at the commencement of the bankruptcy, part of the bankrupt's estate and had vested in the trustee pursuant to section 306 of the Insolvency Act 1986. He ordered that the property be sold. He directed that Mr and Mrs Arora should give vacant possession of the property to the applicant on or before 30th June 2001. It was that last paragraph of the order that Neuberger J was to vary by extending the date for possession to 31st July 2001.
20. Mr and Mrs Arora appealed to the judge. That appeal came before Neuberger J on 8th May 2001. He referred to Mr Registrar James's judgment. He reached the conclusion that there was no basis at all upon which he, as an appellate court, could interfere with that judgment. He observed that the real point which Mr Arora wished to argue before him was whether the bankruptcy order should have been made at all; but that was not a point which could appropriately be raised upon the application which the trustee had made, for the reasons which the judge gave. Accordingly, the judge dismissed the appeal against Mr Registrar James's order but, as I have said, extended the date of possession by a month.
21. It will be apparent from what I have said that the present application is an application for permission to bring a second appeal - that is to say, an appeal against an order of the High Court itself made on appeal from an order of the Registrar. A second appeal cannot be entertained by this Court unless this Court is satisfied that the appeal would raise some important point of principle or practice or that there is some other compelling reason why it should be entertained by the Court of Appeal.
22. I have examined the grounds for appeal set out in section 7 of the appellants' notice. It is impossible to find in those grounds anything which can be described as a point of practice or principle (let alone an important point of practice or principle); nor can there be found in those grounds anything which could be regarded as a compelling reason why this Court should entertain an appeal in this matter. This, therefore, is an application which, on the material at present before the Court, is bound to fail because it does not meet the statutory requirements imposed by section 55(1) of the Access to Justice Act 1999.
23. An application which is bound to fail should not in my view be allowed to remain on the file longer than is necessary for that to be identified; particularly in circumstances in which the effect of the current application is to postpone the realisation of this asset of the bankrupt for the benefit of his creditors. The application has that effect in practice, not because there is any current stay on the order made by the Registrar, but because the trustee in bankruptcy has taken the view that he should not seek to enforce the order for possession while there is a pending application for permission to appeal against that order. That that is the position appears from a fax message from the trustee's solicitors to the Civil Appeals Office dated 28th September 2001. The trustee, and the creditors of this bankrupt, are entitled to expect that the Court will deal promptly with an application for permission to appeal which is bound to fail because no grounds are shown which are capable of satisfying the statutory requirements of section 55(1) of the 1999 Act.
24. In those circumstances - and mindful that Mrs Arora has not been present today - the order which I make is this. Her application for permission to appeal against the order of Neuberger J made on 8th May 2001 is to be struck out on the grounds that it is an abuse of the process of the court, unless within 14 days of today she makes an application to this Court to show cause why her application for permission to appeal should not be struck out. If an application to show cause is made to this Court, then it is to be listed before a judge of this Court for hearing at 10.00 a.m. within seven days of the date upon which the application is made. A copy of my order which I now make is to be sent both to Mrs Arora and to the trustee in bankruptcy, together with a transcript of the judgment which I have delivered, which is to be prepared at public expense.
25. I give those directions in the hope that further expense, delay and the use of court time in this matter can be avoided; and in order that the trustee in bankruptcy (as well as Mrs Arora) will know the view which the court has taken.
Order: As above.