England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE CENTRAL LONDON COUNTY COURT
(Mr Nicholas Mostyn QC)

		Royal Courts of Justice Strand London WC2 Friday, 19th October 2001

1. LORD JUSTICE WARD: This is an application by Mrs Le Foe for permission to appeal the order by Mr Nicholas Mostyn QC, sitting as a Deputy Judge of the Family Division on 19th June 2001. By that order, the relevant parts are that he directed that the matrimonial home at Ashley Gardens be sold, if possible by reconverting it into the two flats, which was the original construction and layout of the property, that the wife, who is the applicant before me today, should have one half of the proceeds of the sale of that property after there had been discharged from the sale proceeds relevant costs of the sale and an amount of £228,000, representing the sum that would have been owed to the Halifax Building Society had the Halifax remained the mortgagees of that property. They had not remained the mortgagees because the husband, a thoroughly dishonest rogue on the judge's findings, duped everybody into remortgaging the property to the Woolwich Building Society and then embarking on various property transactions with the proceeds of that mortgage.
2. The wife applied to set aside that disposition, that mortgage to the Woolwich. She needed therefore to establish that at the time of that mortgage the building society had not acted in relation to it in good faith and without notice of the husband's obvious intention to defeat the wife's claim for ancillary relief. The judge found that the building society should not be fixed with constructive notice of the wife's presence, and he concluded in paragraph 70 of his judgment:

"Even if I had, it is a quantum leap to conclude from that that they should be fixed with constructive notice of the husband's intention to defeat the wife's claim, which is what section 37(4) requires."

3. Mrs Le Foe challenges those findings.
4. There is just, but barely just, material to argue that the building society ought to have been aware of her presence as his wife, not least because in the building society's own documents he shows his marital status as married, and, given the obvious, as I would have thought, signs of habitation by more than the single man he professed to be at this huge house in Ashley Gardens, it is perhaps arguable that the surveyor, there for the Woolwich as their eyes and ears, ought to have put two and two together and realised that two and two equals husband and wife. It does remain a further obstacle to conclude from that, as the judge held, that they had knowledge of his intention to defeat the wife's claim, but having established knowledge, it may be possible to infer that they ought to have appreciated that his lies in his declaring that he was alone would have excited suspicion and put them upon further inquiry, not least to ask the wife if she knew what was going on.
5. It is thus arguable, just arguable. I have endeavoured to persuade Mrs Le Foe that the argument may not be worth the candle because, at the end of the day, there does not seem to me to be sufficient money in this pot to throw more of it into the hands of lawyers who have already grabbed a significant sum, to the distress of the judge. Mrs Le Foe is determined to waste her money or risk wasting her money. Although I have endeavoured to dissuade her, I think that she is entitled to bring a complicated area of the law to the Court of Appeal for further consideration. Whether or not the recent opinions of the House of Lords in the lead case of Royal Bank of Scotland v Etridge(?) throw any further light on what constructive knowledge means, I have not yet had an opportunity to look at.
6. There can be permission to appeal on the limited question of the findings of the judge in answer to his question, was the wife in actual occupation at the time of the creation of the charge? If so, does she have an interest that overrides the interest of the Woolwich? If so, to what extent?On the second question, does the charge amount to an avoidable disposition within section 37 of the Matrimonial Causes Act? If so, should the court exercise its discretion to set it aside?, those matters she may bring to this court for further argument. As for her application to appeal the matter of costs, that seems to me to be wholly within the discretion of the judge. She has no reasonable prospect of success on that. I refuse permission to argue that. She may argue her case against the Woolwich Building Society. This is a highly technical argument. She is wholly incompetent to argue it herself, if she will forgive my saying so. She has moved away from solicitors. If she does not instruct solicitors of her choice she should invite the Court Office to ask the bar pro bono unit to consider representing her on this appeal. If she writes to the Office the matter can be referred to me and I will confirm that the court will be deeply assisted by argument from counsel, even if the upshot of it is that counsel conclude that there is not a worthwhile case to present.
Order: Permission to appeal granted as per judgment; question of stay adjourned. (Order not part of the judgment of the court)