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 BIRMINGHAM COUNTY COURT
(His Honour Judge Charles Harris QC)

		Royal Courts of Justice Strand London WC2 Friday, 30th November 2001

Friday, 30th November 2001

1. LADY JUSTICE ARDEN: This is an application for permission to appeal from the order dated 8th March 2000 of His Honour Judge Charles Harris QC, sitting the Birmingham Civil Justice Centre. There is also an application for an extension of time.
2. In the action the claimant claims arrears of rent due under a 25-year lease dated 3rd March 1993 and made between (1) the claimant's predecessors in title and lessors and (2) Mr and Mrs Walker as lessees. In October 1993 the lease was assigned to the applicant. The lease relates to premises at 15 Showell Road, Bushbury, Wolverhampton. The property comprises a shop and a flat above the shop. In the action the claimant also claims rectification of the lease so as to exclude the flat from the lease. By his order the judge granted rectification of the lease. He also allowed an appeal by the application against the order of the District Judge refusing him leave to call his own expert evidence in addition to the joint expert appointed by the court. The judge adjourned the rest of the action to a date to be fixed and granted permission to the applicant to call his expert witness at the adjourned hearing. On the rectification claim the judge found that the Walkers did not occupy the flat and neither did the applicant. Indeed the flat was let to a Mrs Smith from July 1993 to July 1994 and to a Mr Croft from September 1994. It appears that the flat became occupied in June 1996 and has been vacant since then. Indeed we are told that there was a substantial fire in the flat in mid-1999. The shop also fell vacant at about the same time. The applicant tells us that this was because of damage that occurred as a result of the fire and that the shop remains vacant.
3. The judge heard oral evidence from Mr Palminder Singh, one of the original lessors, and Mr Walker. These witnesses were both parties to the original lease. The judge held that there was a common intention on their part that the lease should cover only the shop. He also held that it would not be inequitable as against the applicant to rectify the lease so as to exclude the flat because the applicant, on his findings, never expected to take a lease of the flat. Indeed, the judge found that he never complained that there were tenants in the flat.
4. The applicant seeks permission to appeal on the following grounds: first, the judge reached the wrong conclusion on the rectification claim; second, that the judge failed to take account of an insurance schedule which I will describe in a moment; and, third, the judge should have directed that expert evidence be by way of written report only to avoid the costs of attendance. Mr Balai is concerned that the cost of his witness attending for a one-day hearing will be £750, plus VAT, which he is unable to pay.
5. I take first rectification claim. The applicant states in his grounds of appeal that it is not just that one side, namely himself, should be held to his agreement but the other side should not be so held. I understand this as a general point, but the judge had to decide whether or not the lease truly reflected the intentions of those who entered into it, namely the original lessor and the original lessee. He heard oral evidence from the representatives of both parties. The applicant was not present when the lease was originally agreed, and so could not himself give useful evidence on this point. The judge's decision turns on his conclusions on the facts as a result of hearing all the evidence. The applicant, Mr Balai, says that it is unfair that he should be held to the lease when it does not contain the flat. But the judge considered the question of whether it was equitable to rectify the lease as against the applicant. He found, however, that the applicant also thought that he was buying a lease simply of the shop and never complained about the presence of tenants in the flat. The judge also took into account the evidence called on behalf of the applicant, being the evidence of Mr Ganbari who was at one stage a partner of the applicants. The judge, however, said that Mr Ganbari was a distinctly unimpressive witness. His evidence at best was that he reported that at one stage Mr Walker had said, "There is a flat above the shop, but I was not really in conversation and did not take part in the price discussions." The judge said it may be that Mr Ganbari genuinely believed that Mr Walker was representing that there was a flat above the shop which was being included in the sale; it would have been strictly accurate to announce that there was a flat above the shop; and it may well be that Mr Walker did indeed say that. However, the judge went on to add:

"In any event, if and in so far as Mr Ganbari's evidence was being held out as that of a man who supports the case that Mr Walker was the contending that he was letting the flat as well as the shop, I do not accept it."

6. That is the judge did not accept it. The judge added:

"I think that Mr Walker thought he was getting the ... shop only; that Mr Balai thought he was getting the ... shop only; and the subsequent behaviour of both of them was entirely consistent with that."

7. So the judge reached his conclusions as a result of hearing the witnesses. He had to make findings, and the well established practice of this court is not to interfere with findings of the court made on the basis of hearing witnesses except in very exceptional circumstances. As far as I can see, there is no prospect of establishing any such circumstances here. Moreover, there is no basis on which it could be said that the judge misdirected himself in law when considering the evidence. So, in my judgment, there is no real prospect of success which would justify the grant of permission to appeal on that point.
8. I now turn to the insurance schedule. Under the lease the applicant is bound to pay an insurance rent. However, in the claim which has been filed insurance has not been separately claimed, and it is not clear whether the landlord is in fact claiming the insurance premium simply looking at the particulars of claim. But the applicant tells us that he has paid it in the past. He tells us that he paid it from 1993 to 1999. However, the insurance schedule with which we are concerned today is an insurance schedule which appeared in the trial bundle and which covers the period 28th September 1999 to 29th September 2000. The insured is the claimant in the action, and the premises insured are both the shop and the flat at 15 Showell Road. This document was in the bundle at trial, but the judge did not refer to it. It happens that the applicant did not have a copy of the bundle at trial because it was held by his solicitors with whom he had been in dispute, and I assume that the solicitors were claiming a lien over it. The applicant tells us that he had managed to get a reduction in the fees, but they had reduced the fees to only £2,000 and he was not happy with it. He says that he had asked for a copy of the file from the claimant. The claimant was happy to provide it on payment of £75. But, nonetheless, the applicant did not get a copy. It appears that they wanted payment in advance and that the applicant did not provide them with that.
9. However that may be, the applicant says, "I have been paying the insurance, and I have clearly been paying for both parts of the premises and that shows that the case on rectification should have failed." He also makes a point that the annual rent sum insured in the schedule is shown as £6,261 whereas the rent payable under the lease is £3,900, and he tells us the flat is uninhabitable. As I see it, the figure of £6,261, may refer to both the flat and the shop, but the applicant tells us that it would be excessive even for both parts of the property.
10. So far as this matter is concerned, of course there was no evidence, so far as we are aware, before the judge that the insurance premiums were paid by the applicant. Nor does it follow that the applicant paid all of the premiums for all the property, because the schedule which we have does not show the premium; so that we are unable to inquire of the applicant whether the sum he paid is the sum shown in the schedule or the equivalent sum for any prior year. Even if he were charged the insurance premium for both parts of the property, as I see it, the principal right to which it would give rise is a possible right to claim reimbursement on the grounds that he had paid more than he was bundle to pay under the terms of the lease. In my judgment there is no real prospect on appeal of persuading the Court of Appeal that the judge's clear findings of fact in the light of the oral evidence that he heard from the witnesses should be overturned in the light of the insurance policy schedule. As I have said, there is no evidence before this court that the applicant has paid for the insurance premium. But even if he had, the payment of insurance premium would not throw light on the essential issue which was the intention of the original parties to the lease at the time that the lease was concluded and also at the time of the assignment.
11. I next turn to the further point made by the applicant under which he wishes to rely on appeal, namely the point that expert evidence at the adjourned hearing should be in writing only. In my judgment there is no prospect on an appeal of persuading the Court of Appeal that the judge's direction was wrong. When he gave it there was no written report available from the applicant's surveyor, so the judge could not properly dispense with the attendance of the expert. We are told that the report has now been produced, so it may now be possible for the parties either to dispense with the personal attendance or for the applicant to obtain a direction from the trial judge that, in the light of the changed circumstances, personal attendance was not necessary. It would be a question for the judge considering the reports and whether the experts had addressed the same points and were in agreement. In the circumstances it seems to me that there is no real prospect of success on this point.
12. Finally, I should say as regards the trial bundle, the fault that the applicant did not have this at the trial was, I think, really the applicant's. He did apply for an adjournment. But, of course, he also had the option of paying for a new copy and we are not told that he could not have done so. But, whatever the position on that is, the only document in the bundle which the applicant contends that the judge should have taken into account which he did not take into account was the insurance schedule with which I have already dealt.
13. In all the circumstances, I would grant the extension of time having read the grounds on which it is sought, namely that a mistake was made about the court to which the appeal notice should be directed, and I would dismiss the application.
14. MR JUSTICE MORLAND: I agree and I would only add this, that if Mr Balai has, in his view, overpaid so far as his insurance rent payments are concerned, it may well be that he would be able to claim that by way of set-off against the claim for arrears of rent at the forthcoming trial.
Order: Application refused.