England and Wales Court of Appeal (Civil Division) Decisions

IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE CHANCERY DIVISION
(Mr Justice Neuberger)

		The Royal Courts of Justice The Strand London WC2A Thursday 15 February 2001

Thursday 15 February 2001

1. LORD JUSTICE ROBERT WALKER: There are before the court two applications for permission to appeal made by Mr Ebert. There is also a third application for interim relief by way of production of documents. Mr Ebert is a very experienced litigant in person who was last year made the subject of a civil proceedings order under s 42 of the Supreme Court Act 1981 as amended.
2. Mr Ebert has in his submissions also raised the issue whether a civil proceedings order has the effect of preventing him from making an application to the Chancery Division of the High Court, sitting in Bankruptcy, under s 375 of the Insolvency Act 1986. Under that section any court with jurisdiction in bankruptcy has power to review, rescind or vary any order made by it in the exercise of that jurisdiction. This morning Mr Ebert has not developed his written submissions on that point, but, as it has been raised, it is one which ought to be dealt with.
3. During the past four or five years, Mr Ebert has made a very large number of applications - probably well over a hundred applications altogether - to different courts and it is very difficult to keep any summary of the matter to reasonable proportions. Neuberger J, who has heard the great bulk of the applications, recently commented that he could not pretend to remember all the details, and certainly the same is true in my case. There have been frequent applications and hearings in the Chancery Division in Bankruptcy, in the Queen's Bench Division, in the Watford County Court and in this court. There has also, as appears from papers which Mr Ebert has put in today, been an arbitration in the court of the Chief Rabbi, the Beth Din.
4. The matter began when Mr Ebert and his then business partner, Mr Morris Wolff, were directors and guarantors of the indebtedness of a company called Europride Ltd ("Europride"). That company had borrowed large sums from more than one bank, and Mr Ebert and Mr Morris Wolff gave guarantees to one of the banks, Midland Bank plc ("Midland"). Europride owned a great deal of residential property in Liverpool, which was let and produced a substantial rent roll.
5. In 1992, or thereabouts, Europride was in financial difficulties and Midland appointed receivers who realised much of the company's property. Mr Ebert has told us this morning that the appointment of the receivers has recently been challenged by the liquidator of Europride, and it may be that that is another aspect of this saga which will continue to occupy the court. What is plain is that Europride also went into liquidation and there was a liquidator in place as well as administrative receivers appointed by Midland. On 25 January 1995 Midland issued two writs, one against Mr Ebert and the other against Mr Morris Wolff. The number of the writ against Mr Ebert was 1995 M 156. The number of the writ against Mr Morris Wolff was 1995 M 906. On 6 June 1995 Deputy Master Cooper gave summary judgment, as it appears, in the same sum; that is, £55,894 against Mr Morris Wolff and on a separate summons against Mr Ebert. One order embodying a summary judgment, that against Mr Morris Wolff, is in the bundle. The other is not. It is central to the complaint which Mr Ebert makes that that judgment, in the sense of a sealed order of the court recording the judgment of Deputy Master Cooper, does not and never has existed. At any rate, it is clear that it is not in the selection of documents before the court today in four bundles prepared by Mr Ebert.
6. What is clear, however, is that on 7 July 1995 (that is, just over a month later) Judge Bentley QC, sitting as a judge of the Queen's Bench Division, dismissed an appeal by Mr Ebert from the Deputy Master's order (which is plainly identified in the sealed order of Judge Bentley) so as to confirm the summary judgment, subject to certain amendments (to the statement of claim and the summons) which had been permitted by the judge. Mr Ebert was at that time represented by solicitors and counsel. The amount involved in the amendment seems to have been quite small. According to a copy of a skeleton argument of Mr Andrew Mitchell, a barrister instructed on behalf of Midland, the effect of the amendment was to make a small reduction, that is a downwards adjustment, in arriving at the sum for which judgment was entered, which is £55,894.
7. On 22 January 1996 Midland assigned to Mr Ralph Wolff (the brother of Mr Morris Wolff) its judgment debt, which had been quantified by the order, less a sum of £8,000 which had in the meantime been received in satisfaction of it; but increased by accrued interest. I should hasten to add that Mr Ebert attacks root and branch the validity of this assignment, but that is an issue which has been before the court many, many times before. It is apparent that Mr Ebert and Mr Morris Wolff had fallen out as business partners. The course followed by Mr Morris Wolff and his brother was commercially unattractive, to say the least. Mr Ebert was plainly unfortunate in his choice of business partner. Various judges, including myself, have made that comment before. I have also commented that the conduct of the Wolffs and their solicitors was not only commercially unattractive but also incompetent in a number of respects.
8. One respect - which has given Mr Ebert an opening which he has indefatigably exploited - is that the first recital to the assignment wrongly identified the action, using the reference 1994 M 1568 (instead of 1995 M 156). 1994 M 1568 was an action by the Meat and Livestock Commission against a company called Deaconvale Ltd, which does not have the slightest connection with anything that is now before the court. Mr Ebert has repeatedly taken the point that he was not a party to it. However, the court has repeatedly taken the view that the stupid mistake made by the Wolffs and their advisors did not have the effect of invalidating the assignment because its substantial effect was not in doubt.
9. On 21 September 1995 Midland had served a statutory demand on Mr Ebert. After the assignment Mr Ralph Wolff as assignee tried to take advantage of the statutory demand. However, on 29 January 1996 Mr Registrar Scott set aside the statutory demand. Mr Ebert has told us that that was in fact on the application of the creditor. Mr Ralph Wolff then proceeded directly against his brother's former business partner.
10. Eventually, on 22 July 1997, Mr Ebert was adjudicated bankrupt. He made numerous unsuccessful attempts to have the adjudication set aside, either by appeal or by having the order rescinded under s 375. On 9 October 1997 there was a meeting of Mr Ebert's creditors, held as required by the Insolvency Rules 1986. Mr Ebert has made numerous criticisms, some of which are plainly well-founded, as to the conduct of this creditors' meeting. I will return to those later.
11. Mr Ebert's belief that he was not being fairly treated was undoubtedly increased by a note, given to him by an officer in the court service on 18 March 1998, which said (authenticated by an illegible signature but also by a legible central office stamp):

"I confirm that no judgment has been entered in the case 1995 M 156 Midland Bank plc v Ebert."

12. However, Mr Ebert has also very properly included in his bundles a letter dated 20 March 1998 from a Head Clerk in the Action Department at the Royal Courts of Justice. She wrote:

"Re: Midland Bank PLC- v- Yourself and Morris Wolff. Case no 1995 M 156

Following your visit to the Action Department this morning, I confirm that the Order 14 judgment entered in this matter on the 6 June 1995 was inadvertently entered in the cause book as an order. This was corrected on the 18 March 1998 after your visit and the judgment is now shown in the correct place in the cause book. I confirm that the order dated 7 July 1995 [that was the order on appeal, not the order of the deputy master] has been sealed by the court and entered in the cause book.

To date the judgment entered on 6 June 1995 [the judgment of the deputy master] has not been amended and is shown in the cause book in the sum of £55,894.70 with costs to be taxed."

13. That was the correct sum. It appears that the correct reduced sum was the sum for which the deputy master was asked to give summary judgment on 6 June. It was the summons and statement of claim which Midland had undertaken to amend.
14. Mr Ebert's assertion that there is no final judgment against him must therefore be read in the light of that letter, although it does appear that Midland's solicitors, Eversheds, may have been in breach of their duty to the court in failing to amend the statement of claim and the summons in accordance with their undertaking. That appears to be the effect of a letter dated 16 February 2000 from the same Head Clerk in the Action Department. However, the skeleton argument of counsel, which I have mentioned, asserts that the necessary amendments were made and that the documents would be produced if necessary at the hearing for which the skeleton argument was prepared. At all events, it appears to me not to affect the amount of the judgment debt, the appeal against which was dismissed by a properly drawn order on 7 July 1995.
15. I pass over an enormous number of further applications and proceedings by Mr Ebert which resulted in several increasingly stringent Grepe v Loam orders being made against him (see Grepe v Loam (1887) 37 Ch D 168 and also the decision of this court in Ebert v Venvil [2000] Ch 484). Eventually Mr Ebert was declared to be a vexatious litigant and a civil proceedings order was made against him.
16. The effect of such an order is, among other things - and I read from s 42(1A)(c) of the section as amended, this being part of the definition of the expression "civil proceedings order":

"No application other than one for leave under this section shall be made by him in any civil proceedings instituted in any court by any person without the leave of the High Court."

17. Mr Ebert's applications for permission to appeal are from the refusal of Neuberger J to give him permission under s 42 to make two applications, one in his bankruptcy and the other in the original action by Midland, assuming that action to be in any sense still on foot. The third application is, as I have mentioned, in the nature of an interim application for production of documents.
18. These new applications have, Mr Ebert has urged upon us, been encouraged or advised by responsible officials. What seems to have happened is that after Mr Ebert was made subject to the civil proceedings order he took his campaign outside the law courts, as it were, writing to various persons, including the Secretary of State for Trade and Industry and the chartered accountants' professional body. Mr Ebert has had some correspondence with Mr Desmond Flynn, the Deputy Inspector General of the Insolvency Service. Then on 18 December 2000, encouraged, as he thought, by that letter, Mr Ebert applied to Neuberger J for permission under s 42 to make the first of applications I have mentioned.
19. Neuberger J evidently considered that application very carefully. He produced written reasons for refusing it running to 17 paragraphs. He gave detailed consideration to points which Mr Ebert had made about the conduct of the creditors' meeting held on 9 October 1997. These points were supported by Mr Ebert's detailed references to rule 6.93 and following of the Insolvency Rules 1986. The judge accepted some of the criticisms as well-founded. He described them as procedural defects which did not of themselves go to the invalidity of the meeting, and he assumed in Mr Ebert's favour that other criticisms, on which there was insufficient evidence, might be well-founded. Neuberger J concluded that although there had been procedural defects, the decisions made at the meeting were valid and that Mr Ebert was far too late to try and raise them three years later. He might, I think, have added that most of these complaints seem to have been raised before, possibly on many occasions, but certainly at the hearing in front of Mr Registrar James on 22 October 1999. It may have been on appeal from that that Neuberger J gave a judgment in November 1999, indicating that he would look sympathetically on further applications by Mr Ebert for the production of documentation if that documentation was refused.
20. However, matters have moved on quite a long way since November 1999. Mr Ebert continued to have contact with Mr Flynn and also with Mr Boulter of the Insolvency Service. On 10 January 2001 Mr Flynn wrote to Mr Ebert and referred to the then recent ruling of Neuberger J. Mr Flynn wrote:

"Whilst Mr Justice Neuberger identified a number of technical deficiencies in the way in which the proceedings at the meeting were recorded he concluded that these did not invalidate Miss Venvil's appointment [as the trustee in bankruptcy]. Despite that, as Mr Justice Neuberger observed, that you were not prejudiced in any way by those deficiencies I would offer you the Insolvency Service's apology for them.

From our conversations it is clear to me that your concerns are more fundamental than those concerning the procedure by which Miss Venvil was appointed your trustee. In essence you have told me that you deny that there was ever any indebtedness from you to the Midland Bank which was capable of supporting a judgment in their favour against you and that therefore any such claimed judgment must either be a fiction or a nullity and that therefore there could be no genuine assignment in favour of Mr Ralph Wolff. On that basis you dispute the bankruptcy order should ever have been made. I am not aware of the detailed history of the matters you have brought before the court but it seems to me that, if the court has not already done so, it should be invited by you to consider these fundamental points."

21. In writing that Mr Flynn was no doubt trying to be helpful, and Mr Ebert regards it as the first piece of official advice or encouragement to persist in his applications. However, it seems to me that Mr Flynn could not have written as he did if he had had a detailed knowledge of the history of this matter.
22. The other encouragement which Mr Ebert relies on is a letter, also dated 10 January 2001, from Europride's liquidator. The liquidator knew relatively little about the matter (although from what Mr Ebert tells us, it may be that he is now much better informed) because at the time the practicalities were that the administrative receivers appointed by Midland rather than the liquidator had been in the driving seat. The liquidator wrote:

"Should you wish to see further documentary evidence concerning the payment [of about £41,000 to Midland] I suggest that you contact either the Administrative Receivers or Midland Bank Plc directly."

23. Again, I do not think the liquidator could have had any full appreciation of the history of this matter or of how much documentary material Mr Ebert already had in his hands.
24. Rule 6.101 of the Insolvency Rules 1986 permits a bankrupt, among other persons, to inspect proofs of debt. Mr Ebert already has copies of the relevant proofs and of official form OR(U)59M but nevertheless he wants permission to apply to the court under s 375 of the Insolvency Act 1986, apparently to obtain the same documents again. That is what has led the trustee in bankruptcy to write to him as she did in a letter dated 11 December 2000, which Mr Ebert has put before us. She wrote:

"I write in response to your purported Notices under rule 6.101 of the Insolvency Rules 1986. You of course have copies of the documents you now wish to inspect. The notices are of course yet another part of your campaign to waste people's time and costs. In support of that statement I rely upon the judgment of Mr Justice Hart of 21st September 2000, when he dismissed your application on the basis that it was an abuse as it was not genuine. The same point applies equally here. The requests are denied as they are not given in good faith and are an abuse of process.

It seems as if you are both now intent on causing confrontations and are willing to use violence to further your own misguided ends."

25. She then made some further points and indicated that he was not to be permitted to inspect the proof and would not be given access to the office building where she works.
26. Mr Boulter also had to write in a somewhat similar way, as he did in letters of 12 and 15 December 2000. I need not, I think, read those letters.
27. Mr Ebert's first application, for which he sought permission, had been directed to seeking documents from the trustee in bankruptcy and the Official Receiver; his other application was directed to seeking documents from Midland and its receivers, with a view to overturning the judgment debt which, as the court has repeatedly held, had existed since 6 June 1995, although Mr Ebert has persistently resisted that conclusion. Mr Ebert made the second application on 16 January and later renewed it. Neuberger J declined to grant permission. In refusing permission to appeal (while granting permission under s 42 for Mr Ebert to apply to this court for permission to appeal) Neuberger J wrote:

"The points which Mr Ebert wishes to raise have been the subject matter of a large number of unsuccessful applications (to me, and, in the most part, to the Court of Appeal) already. It would be an abuse of the process of the court for Mr Ebert to raise these points again."

28. The essential point is very shortly stated in Neuberger J's judgment given on 16 January 2001 after an oral hearing. The judge said:
29. He [Mr Ebert] is quite right to identify the defects at the meeting, but, to my mind, the central point is that one of the votes, that of Ralph Woolf was, on the evidence I have seen, indubitably a valid vote to take into account, despite Mr Ebert's very strong feelings to the contrary. Although copies of certain documents may not be available to the Insolvency Service, or may have been lost, I have held, and the Court of Appeal have refused permission to appeal against my holding, that the Midland Bank had a valid judgment against Mr Ebert. The benefit of that judgment was assigned to Ralph, and that was the basis of for Mr Ebert's bankruptcy, the bankruptcy order having been made by Mr Justice Lloyd more than three years ago. Mr Ebert has sought to attack that judgment and the assignment on a number of occasions, and has even sought liberty to apply way out of time to set aside that judgment. He has always failed."
30. However, concern for Mr Ebert's human rights led the judge to give permission under s 42 for an application to be made to this court, as I have mentioned.
31. Mr Ebert has put in some well-researched submissions as to the meaning of "civil proceedings" in s 42 of the Supreme Court Act 1981 as amended. He has drawn attention to Re Wilson (a bankrupt) [1973] 1 WLR 314, in which Goulding J held that a vexatious litigant (subject to an order made under s 51 of the Supreme Court of Judicature (Consolidation) Act 1925, as amended, which was in different terms) was not prevented from submitting a proof of debt in another person's bankruptcy. That would still be the case, I think, under the amended s 42, although it is more doubtful whether Goulding J's observations about an appeal from a rejection of a proof would still hold good, because of the wider definition of "civil proceedings order" under the current statutory provision. Mr Ebert also drew attention to the decision of this court in ex parte Waldron [1986] QB 824, a decision on s 139 of the Mental Health Act 1983. This court held that the qualified immunity granted by that section against liability in "civil proceedings" did not exclude an application for judicial review to quash a decision as to compulsory admission to a mental hospital under s 3 of that Act (colloquially known as "being sectioned").
32. That decision is binding on this court but its context and reasoning are to my mind a considerable way away from a civil proceedings order under s 42. Ex parte Waldron was not cited in R v Highbury Magistrates Court ex parte Ewing [1991] 3 AER 192, in which this court held that a civil proceedings order does apply to even a preliminary application for permission to seek judicial review.
33. Mr Ebert has cited a number of pertinent authorities to show that the bankruptcy jurisdiction is not an ordinary process of litigation. Bankruptcy (like being a mental patient, or a ward of court) is to some extent a matter of status, standing apart from ordinary adversarial litigation. Nevertheless, an application to the High Court made in the course of a bankruptcy is, in my view, plainly an application made in civil proceedings within the meaning of s 42. The expression "civil proceedings" is not defined and there is, to my mind, no good reason to construe it narrowly. I agree with the observations on that point of Nicholls LJ in the Highbury Magistrates case at p 197. In my judgment the officials in the Bankruptcy Court were quite right to tell Mr Ebert that an application by him under s 375 of the Insolvency Act would need permission under s 42.
34. I have, out of deference to Mr Ebert's very strong feelings (and I have to say that Mr Ebert, despite his very strong feelings, has addressed us this morning with courtesy as well as skill) dealt with this matter at some length. It is right that it should be dealt with at some length, especially in view of the deplorable number of errors that have been made over the years. Nevertheless, this application, and the amount of time it has taken this court both to prepare for it and to hear it, does illustrate yet again how a small number of determined litigants in person, who will never take no for an answer, make wholly disproportionate demands on the resources of the civil justice system, to the possible detriment of other litigants.
35. Neuberger J, who has had to bear the brunt of the burden of applications by Mr Ebert, has shown himself, to my mind, conspicuously patient, fair and open-minded. He said in his earlier judgment on these applications:

". . . while Mr Ebert has made an enormous number of misconceived applications, it is not right to rely on that fact, or the fact that he is a vexatious litigant, to prevent him from raising a point which may have some force."

36. I have I hope tried to adopt the same approach in considering these applications. Mr Ebert has suffered grave misfortunes in his business and family life, and his strong feelings on the matter are entirely understandable. His strong feelings are entirely understandable also because of the many errors which have been made, as I have mentioned. Nevertheless, approaching the matter in that way, I can see no ground for supposing that Neuberger J erred in the careful exercise of his discretion in any of the decisions from which Mr Ebert seeks permission to appeal. In those circumstances, the ancillary application would also drop away. I would therefore dismiss all these applications.
37. LORD JUSTICE KEENE: I agree.
ORDER: Applications dismissed. A copy of the transcript of this judgment to be provided at public expense. (Order not part of approved judgment)