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 PUMFREY)

		Royal Courts of Justice Strand London WC2A 2LL Friday 7 December 2001

1. LORD JUSTICE CHADWICK: There are listed for hearing three linked applications for permission to appeal arising from litigation between the applicants, Mr and Mrs Cullen, Whinhurst Investments Limited and Mrs Cullen's trustee in bankruptcy.
2. Mrs Cullen was the tenant of premises known as 249 London Road, Camberley, leased from Whinhurst Investments. In the course of those proceedings, an order was made for the payment by Mrs Cullen of £17,584 by way of interim rent. On 24 March 1987 a bankruptcy order was made against her in the Guildford County Court. An appeal against that order was dismissed by Scott J on 12 May 1987 and permission to appeal from his order was refused by this court, Fox LJ, on 19 January 1988.
3. Ten years later, Mrs Cullen applied under section 282 of the Insolvency Act 1986 to annul the bankruptcy order on the grounds that it should never have been made. That application came before District Judge Lethem in the Tunbridge Wells County Court on 21 September 1999. He dismissed that application, essentially on the basis that it was not open to Mrs Cullen to seek to relitigate matters which had already been the subject of a final decision; that is to say the decision of Scott J from which this Court had refused permission to appeal.
4. Nevertheless, the district judge took the view that he had power to review the bankruptcy order under section 375 of the Insolvency Act 1986 on the grounds that there had been a change in circumstances. He decided to rescind the order on terms that Mrs Cullen paid £14,966 to the trustee in bankruptcy within three months. That sum represented the trustee's costs and expenses. Mrs Cullen did not make that payment.
5. The matter came back before the same district judge on 31 October 2000 on a further application by Mrs Cullen for rescision of the bankruptcy order without conditions. The district judge reconsidered the question whether he had had power in September 1999 to review and rescind the bankruptcy order under section 375 of the 1986 Act. He held that he had had no power to do so. Accordingly, he set aside the order of 21 September 1999, in so far as it still continued to have any effect, and dismissed the application which was then before him.
6. Mrs Cullen appealed to a judge of the High Court against the orders of 23 September 1999 and 21 October 2000. That appeal came before Pumfrey J on 4 May 2001. He extended time for appealing against the order of 23 September 1999; but he dismissed both appeals. He set out his reasons in a full judgment and refused permission to appeal. At page 46 in the transcript of proceedings after judgment, and in response to an application for permission to appeal, the judge said this:

"This seems to me to e a clear case in which permission to appeal should not be granted. This matter has now been up to the Court of Appeal once. All the factors affecting what I have done have been considered by two separate tribunals (at least) and this is simply not a case in which, in my view, it would ever be proper for me to grant permission to appeal."

7. On a true analysis Pumfrey J would not, in any event, have had jurisdiction to grant permission to appeal from the orders which he had made dismissing appeals against the orders of the district judge. This matter fell within section 55(1) of the Access to Justice Act 1999. Permission to appeal from an order of the High Court, made on an appeal from a lower court can only be granted by this court; and only if one or other of the conditions set out in section 55(1) of the 1999 Act are satisfied. It is necessary for the applicant to satisfy this court, either that there is some important point of principle or practice which would be raised by the appeal, or there is some other compelling reason why the appeal should be entertained by this court.
8. I turn, therefore, to the appellant's notice filed on 21 August 2001 to see the grounds upon which it could be said that either of those conditions are satisfied. The grounds set out in section 7 of the appellant's notice are as follows:

"1. The County Court can make rent assessments up to any amount under Landlord & Tenant Act 1925 but has No Jurisdiction to give a Monetary Judgment above £5,000.

2. The Court of 1st instance had no jurisdiction to make a Bankruptcy Order under the Insolvency Act 1986 upon a Petition founded on an act of Bankruptcy under the BA 1914. They being incompatible statute laws.

3. The Lower Court had no jurisdiction to alter the footing of the appellant's application for annulment from sec 282(1)(a) to sec 375 of the Insolvency Act 1986 on the inapplicable grounds of Henderson v Henderson."

9. There is then a note:

"NB Mr Justice Pumphrey (sic) has yet to give a decision on granting or refusing leave to appeal on the above points of law."

10. For the reasons that I have already explained, it is not within Pumfrey J's power to grant permission to appeal in a case falling within section 55(1), so the assertion that he has yet to give a decision is misconceived. It is also inconsistent with the passage in the transcript to which I have already referred, is itself misconceived.
11. Of the three grounds of appeal, the first two could have been raised in the earlier applications to Scott J and this Court. The third is of no help to the applicant; because, if the court had no jurisdiction to make an order under section 375 of the 1986 Act as to the district judge, himself, held in October 2000, then the applicant can be in no better position that she is now.
12. Continuing with the grounds of appeal:

"4. The Court of 1st instance having a conflict of interest, had No Jurisdiction to suspend the appellant's discharge from bankruptcy on 27/1/1989.

5. The Lower Court failed to address all grounds relied upon in the application to annul and failed to have due regard to all relevant evidence or the facts and statements in the appellant's affidavits of 18/5/98 and 17/9/99.

6. The Lower Court had no jurisdiction on 23/9/99 to make the rescinding order conditional upon payment of £14,966 in satisfaction of the Trustee's surprise claim and refusing to hear the appellant's case in defence to the said claim.

7. That the Lower Court had no jurisdiction to extend Locus Standi to the petitioning creditors on 31/10/00 to oppose the application for annulment when in knowledge that they were under a Consent Order not to oppose it in the first instance of hearing on 23/9/99.

8. The Lower Court had no jurisdiction to affirm the Bankruptcy Order upon an authority put before it by the petitioning creditors on 31/10/00 nor to make a Grepe v Loam order against the appellant at their asking.

9. The Appeal Court misdirected itself by filing to have due regard to the above facts and thereby erred in law in affirming the Lower Court's orders of 23/9/99, 31/10/00 and in the same judgment ruling that the petitioners had no Locus Standi in the hearing of 31/10/00 when under the Consent Order and that the Trustee was a Bystander in that instance, 31/10/00.

10. Violation of the appellant's rights under Article 3, 5, 6, 14 of the ECHR and HRA 1998.

11. The overriding objective set out in CPR 1.1."

13. Mrs Cullen has not appeared on this application. On 28 November 2001 (at the end of the last week) she wrote to the Civil Appeals office to say that she had been given a hospital appointment for 7 December (today) and, therefore, would be unable to attend at court. She continued:

"Please take note I would not have been capable of presenting the above three cases on the day in any event."

14. She points out that her husband, Mr Cullen, suffers from memory loss and confusion. She then makes the point, again, that Pumfrey J has not yet given a decision on permission to appeal and she asks that the application should not be listed with the other two applications (to which I shall turn) until after Pumfrey J has had time properly to consider the matters and make a decision on permission to appeal. As I have indicated, the permission to appeal point is misconceived. Mrs Cullen attaches to that letter a letter from Frimley Park Hospital, dated 26 November 2001, informing her that an out-patient appointment had been made for 3.15 pm on Friday 7 December. Mrs Cullen does not make it clear in that letter why it is impossible to attend at the Royal Courts of Justice at 10.30 am for a hearing estimated to last no more than 30 minutes, and also to attend for a hospital appointment in Camberley at 3.15 in the afternoon. There may be a reason; but she has not informed the court what that reason is.
15. I have to consider whether to adjourn her application for a further hearing at some indeterminate date, or to deal with the application now. In the circumstances that I am satisfied that this is an application which is bound to fail, because no ground has been shown which could satisfy the requirements of section 55(1) of the Access to Justice Act 1999, I propose to deal with the matter in the absence of Mrs Cullen. Because the conditions in section 55(1) of the 1999 Act are not satisfied, the application under Court of Appeal reference 2001/1900 is dismissed.
16. I turn to the other two applications, under reference 2001/1614 and 2001/1615. 2001/1614 is an application by Mrs Cullen, 2001/1615 is an application by Mr Cullen. Mr Cullen is not here either. On the basis of the explanation for his non-attendance given in Mrs Cullen's letter of 28 November, it seems unlikely that Mr Cullen will ever attend this court to make his application. If the application is to be made at all, it will have to be made by Mrs Cullen on his behalf; unless, of course, he instructs solicitors.
17. The two applications, however, are substantially identical. They are made in proceedings brought by Mrs Cullen's trustee in bankruptcy against Mr and Mrs Cullen in relation to the sale of their house, 24 Academy Close, Camberley. It appears - although the order is not in the bundles before me - that, on 23 February 2001, District Judge Lethem made an order for the sale of that house under the Trusts of Land and Appointment of Trustees Act 1996.
18. On 18 March 2001, Mr and Mrs Cullen each made applications to set aside that order. Those applications came before District Judge Lethem on 30 April 2001. He dismissed the applications. He refused permission to appeal; and he also refused an application for the provision of a transcript at public expense. The circumstances in which a transcript can be provided at public expense are set out in the practice direction made in relation to CPR 52 at paragraphs 5.17 and 5.18. 5.17 provides that:

"Where the lower court or the appeal court is satisfied that an unrepresented appellant is in such poor financial circumstances that the cost of a transcript would be an excessive burden the court may certify that the cost of obtaining one official transcript should be borne at public expense.

5.18 In the case of a request for an official transcript of evidence or proceedings to be paid for at public expense, the court must also be satisfied that there are reasonable grounds for appeal. Whenever possible a request for a transcript at public expense should be made to the lower court when asking for permission to appeal."

19. The district judge took the view that the financial condition in paragraph 5.17 was satisfied, but that he was not satisfied that there were reasonable grounds for appeal. Accordingly, he treated himself as precluded by paragraph 5.18 from directing the provision of the transcript at public expense.
20. Mr and Mrs Cullen each appealed to the High Court. On 5 July 2001 those appeals came before Mr Peter Smith QC, sitting as a deputy judge of the High Court in the Chancery Division. It became plain that Mr and Mrs Cullen were not in a position to proceed with their appeals on that day for three reasons. The first was that they did not have the transcript which they had been seeking; although there was available a note of the district judge's judgment, approved by him. Secondly, the appeal was thought to require a full day's hearing and there was not a full day on 5 July available to hear it. Thirdly, the unqualified representative who sought to present Mr Cullen's appeal was not ready to deal with the appeal. She thought that she had come only to challenge the district judge's decision to refuse the transcript. In those circumstances, the judge adjourned the applications for hearing to the first available date after 19 July, with a time estimate of one day. But he took the view that Mr and Mrs Cullen had been responsible for the costs wasted on the 5 July 2001 and required them to pay those costs on or before 19 July. He assessed those costs at £2,079. It is against that part of his order (paragraph 4) that both Mr and Mrs Cullen seek permission to appeal.
21. The circumstances in which, as they say, they came to court on 5 July 2001 in the belief that the only matter that was to be dealt with on that day would be the application for the provision of transcripts at public expense, appear from correspondence dated 20, 21 and 22 June 2001. It seems that the court appreciated on 20 June that the time required for hearing the appeal was going to be more than the time which had been allowed on the basis that only the transcript issue was to be dealt with. Accordingly, Mrs Cullen invited the solicitors for the trustee to agree that the appeal should be relisted and that the only matter to be dealt with on 5 July should be the transcript issue. That issue could be dealt with without their attendance or on paper.
22. On the same day the solicitors wrote to confirm their consent to the hearing to be relisted for a full one-day hearing. In the light of that letter, it is understandable that Mrs Cullen took the view that the trustee would not be represented on 5 July 2001. On 21 June 2001, the trustee's solicitors wrote to her, enclosing an approved note of the district judge's judgment. They expressed the view that, in the light of the approved note, there was no need for her to pursue an application for a transcript at public expense. District Judge Lethem had agreed the note; and the approved note was, they said, as good as a transcript.
23. Whether or not Mrs Cullen had received that letter on 22 June, she wrote to the court on that day enclosing a copy of the solicitor's letter of 20 June confirming their consent to the hearing on 5 July being relisted for a full one-day hearing. She went on:

"We will use the fixture of the 5th July 01 for the hearing of the Transcript at Public Expense Issue and ask for an adjournment of the Appeals to a date to be agreed following receipt of the transcripts."

24. In those circumstances she was, understandably, concerned and aggrieved when the trustee appeared by solicitors and counsel on 5 July 2001 with the intention of dealing with the substantive appeal. She was even more aggrieved when the judge, having adjourned the appeal because she was not ready to pursue it, ordered her to pay the wasted costs. It is against that decision that she seeks permission to appeal. It seems to me that there is some force in her concern.
25. I am reluctant to add to the costs which are building up in this litigation by giving permission for an appeal at which Mr and Mrs Cullen will be at risk of being required to pay the trustee's costs if their appeal is unsuccessful. Accordingly, I will adjourn the applications 2001/1614 and 2001/1615 for permission to appeal to come on on notice to the trustee, with appeal to follow if permission is granted. The applications and the appeal are to be listed for hearing before a two-judge court at 10 am with a time estimate of half-an-hour. The point is an extremely short one.
26. I direct also that a transcript of this judgment be prepared at public expense and a copy sent to both Mrs Cullen and the trustee. It may be that in the light of the observations that I have made, Mr and Mrs Cullen and the trustee will find it possible to agree that paragraph 4 of the judge's order of 5 July can be set aside by consent. If they are able to agree that, then an application to set aside that part of the order by consent can be made on paper. If they are not able to agree that before the adjourned application is listed for hearing; then each of the parties will be at risk as to the further costs which will be incurred on that application.
Order: Application adjourned to be heard on notice with appeal to follow if leave is granted. Transcript of judgment to be sent to both sides and provided at public expense.