England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
APPLICATION FOR PERMISSION TO REINSTATE
APPLICATION FOR PERMISSION TO APPEAL

		Royal Courts of Justice Strand London WC2 Wednesday, 21st March 2001

1. LORD JUSTICE CHADWICK: On 30th April 1999 Mr Justice Rougier dismissed two actions (CH/1996/E/3839 and CH/1998/E/1998) brought in the Chancery Division by Mr Brian Edgar against three defendants, Mr Berger, Mr Stein and Mr Lloyds, who were or had been partners in a firm of solicitors, Philip Conway Thomas.
2. The claims in the action against the solicitors were for fraud, dishonesty and breach of trust in the conduct of Mr Berger's affairs. The judge made it clear, at page 25 of the transcript of his judgment, that he regarded the claims in the action as wholly unjustified. He marked his view that the action should never have been brought against these three solicitors by an award of costs on an indemnity basis against Mr Edgar. The judge directed, also, that a transcript of his judgment and the papers in the case should be sent to the DPP so that he could consider criminal proceedings against Mr Edgar. It is plain that the judge had formed the view that much of Mr Edgar's evidence before him had been false to Mr Edgar's knowledge. In fairness to Mr Edgar it should be said that, so far as I am aware, criminal proceedings have not been commenced against him for perjury or any other crime.
3. By notice dated 21st May 1999 Mr Edgar sought permission to appeal against Mr Justice Rougier's order of 30th April 1999. The grounds in the pro forma notice of appeal lodged with that application were that the judge erred in his findings of fact. I read from the appellant's notice:

"The judge erred in his findings of fact both with regard to the forgery by the defendants of the plaintiff's signature and the way in which the plaintiff's business affairs were handled by the defendants who were his lawyers at all relevant times, and in law in finding against the plaintiff."

4. As a foundation for an appeal in a case involving allegations of fraud, dishonesty and breach of trust following a trial which had occupied some seven days, those grounds are seriously lackingin particularity.
5. Mr Edgar recognised that, this notice went on to seek an extension of time in which to finalise the grounds of appeal. Mr Edgar explained in his notice that he could not provide full particulars of his grounds of appeal until he had seen a transcript of the hearing that took place in the court below. He pointed out that, although he had applied for the transcript, he was now on employment benefit and he had to obtain a direction that the transcript be provided at public expense. Until he succeeded in obtaining that he would not be able to particularise his grounds of appeal.
6. In the light of that difficulty, and before the application for permission to appeal had been heard, he made an application to this court for a direction that a complete transcript of all the evidence at trial be provided at public expense. Master Hodgson refused that application. Mr Edgar applied to this court. The application was heard by Lord Justice Henry and Lord Justice Waller on 20th October 1999. Mr Edgar appeared in person. The court refused the application. The court pointed out that Mr Edgar could and should be required to identify by reference to the transcript of the judgment of Mr Justice Rougier - which he did have - those aspects which he sought to challenge and the reasons why he needed a transcript of all the evidence given in the proceedings for that purpose. In the course of his judgment Lord Justice Waller said this:

"Essentially, my view is that the Master was right to refuse a transcript at this stage, but it may be that one could vary the position slightly in this way. It cannot be right (Mr Edgar before us accepted this as realistic) simply to make an order for a complete transcript to be produced at public expense. There must be a document setting out what Mr Edgar's grounds of appeal are as at this stage. He has a transcript of the judgment. He can go through that judgment and specify in a document those aspects of the judgment which he challenges, and he can set out the bases that he says he has for challenging each and any conclusion of the judge. If he is then of the view that he cannot make good an arguable case in relation to any of those grounds without some part of the transcript of the trial being available to support his application for permission to appeal, then, in my view, it would be appropriate for him to return to the Master with that draft document in order to demonstrate that there is some part of the transcript that he ought to be allowed to have at public expense, even at the application for appeal stage."

7. With those observations, this court stood over the application for permission to appeal so as to enable Mr Edgar to do what Lord Justice Waller had suggested. The court directed that the appeal should not be listed for a further six weeks. Further directions were given by the Civil Appeals Office, in response to a letter from the Citizens Advice Bureau dated 16th November 1999, in a letter of 13th January 2000. In the meantime, however - and, no doubt, through an oversight - the application for permission to appeal had been re-listed. It was dismissed in Mr Edgar's absence. That occurred on 6th December 1999.
8. In those circumstances, and understandably, Mr Edgar made an application to reinstate his application for permission to appeal. That application is set out in a letter from the bureau manager of the Citizens Advice Bureau at the Royal Courts of Justice dated 23rd March 2000. However, by that date, Mr Edgar had been adjudicated bankrupt. The Bureau took the view that, whatever causes of action Mr Edgar might have had in the proceedings which he had commenced in 1996, those had vested in his trustee in bankruptcy under Section 306 of the Insolvency Act 1976. It was necessary therefore to obtain the consent of the trustee in bankruptcy for the pursuit of those claims.
9. On 21st June 2000 the matter was listed before Deputy Master Joseph to show cause why the application to reinstate the application for permission to appeal should not be dismissed for failure to comply with directions which had been given. An order was made on 21st June, after hearing Mr Edgar in person, that the application to reinstate should be dismissed without further order unless Mr Edgar did two things: the first was to provide a letter from a trustee in bankruptcy which confirmed that the subject matter of the actions had been assigned to Mr Edgar, or that the trustee had no interest in the subject matter; the second was to lodge bundles which complied with the court's requirements for an application for permission to appeal together with copies of the transcript of the judgment and the transcript of the evidence. At this stage Mr Edgar was in receipt of help from the Westminster Citizens Advice Centre. In due course the trustee in bankruptcy - while not providing anything that could be described as an assignment or an authority - did, at least, provide Mr Edgar with a letter which indicated that the trustee had no interest in the proceedings.
10. It was in those circumstances that the matter came before me in February 2001. There were before me on that occasion (i) the application to reinstate the application for permission to appeal and, if reinstatement were allowed, (ii) the application for permission to appeal itself. I took the view that Mr Edgar had provided the bundles which the Deputy Master had directed him to provide; and that he had done what he could to comply with the direction in relation to the trustee in bankruptcy - to the extent that there was no prospect that anything better would be forthcoming from the trustee in bankruptcy. What he had not done was to comply with the directions which Lord Justice Waller had given on 20th October 1999. In those circumstances I made an order to the effect that Mr Edgar would have one further opportunity to do what he had been invited to do by this Court on 20th October 1999; namely, to identify those parts of the judgment of Mr Justice Rougier - by reference to the transcript of that judgment -against which he asserted that there was a real prospect of success on appeal and to provide references to the evidence on which he wanted to rely.
11. In response to that order Mr Edgar has lodged a further bundle with the court. In that bundle he includes not only a transcript of Mr Rougier's judgment but also transcripts of the evidence given on 26th, 27th and 28th April 1999 by Mr Berger, Mr Stein and Mr Taylor. I should add that Mr Lloyds, the other defendant to the action, had dropped out of the action before the hearing before Mr Justice Rougier. There is included in the bundle a six or seven-page document headed "Submissions made pursuant to an order made on 19th February 2001" which set out a number of criticisms of the judge's judgment. For example, the second paragraph begins with the assertion that -

"The learned judge came to the absurd conclusion that the defendants `had done all and more than demanded of them to assist him.'"

12. It goes on to assert that the judge took "a totally and unquestionably benign attitude to the evidence given by the defendants" and, "in short, that the judge had formed a clear prejudice against Mr Edgar". Those allegations are serious. If they are to be made good, they will nee to be substantiated by cogent material. This is not a case in which it is said that the judge simply reached a wrong conclusion. It said, in effect, that the judge was so prejudiced against Mr Edgar that he took no notice of what Mr Edgar was saying to him and accepted the evidence of others uncritically.
13. The bundle contains also a single page headed "List of transcript extracts". The form of that page is it contains references to a passage in the judgment followed by references to passages in the transcripts of evidence. Prima facie, the page suggests that the passages in the transcripts to which reference is made are those passages which relate to the immediately foregoing passage in the judgment.
14. Before embarking on the exercise of looking at those passages, it is convenient to mention the nature of the action; and to illustrate the view which the judge took of Mr Edgar and his evidence. The judge describes the action on the first page of his judgment in these terms:

"The first action brought against both defendants was begun by writ issued in March 1991, and contains four separate claims. The first relates to the proposed acquisition by Mr Edgar of the majority of the flats in a block called La Talencia in Spain during 1977 and 1978.

The next claim concerns a block of flats called Vere Court, and has two distinct component parts, both of which make very serious allegations of fraud and forgery against Mr Stein.

The third claim, in what has been called `the main action', concerns the unfulfilled desire of Mr Edgar in 1979 to buy a parcel of properties which have been referred to as `The Dormy House', that being the main item.

The final claim, No. 4 in the main action, is connected with certain refurbishment grant moneys advanced respectively by the Westminster Council and the Royal Borough of Kensington and Chelsea in relation to properties owned by Cheviot, one of Mr Edgar's many companies. In outline, the defendant, Mr Stein, is accused of wrongly retaining certain of the grant moneys and failing to pay them over to Mr Edgar or to his company, although that last part is not pleaded. These matters are alleged to have taken place in 1982. This appears to be a claim for account of moneys received, though there is an undercurrent of fraud in the way in which it has been drafted."

15. The judge observed that one of the potential difficulties in the way of Mr Edgar's claims is that, at first sight, they are claims by the companies rather than claims by him in person. The judge seemed to be content to deal with them on the basis that Mr Edgar and his companies were indistinguishable. For my part, I have some doubt as to whether that approach would stand in the light of the decision of the House of Lords in Johnston v Gore Wood. But that is not a point I need to consider further.
16. The judge's assessment of Mr Edgar is at page 4 of the transcript. He said this:

"The second matter is that the claimant attempted to paint himself to me as effectively a babe in the woods, barely literate, who needed assistance in all aspects of his proposed transactions, both those which were legal and those which were commercial. This is not a picture which I am able to recognise. I accept that he does not read or write easily. I accept too that in the matter of what one might call the `legal nuts and bolts' of any particular transaction, together with matters fiscal, he, like any layman, relied on the defendants' expertise. But Mr Edgar is more than adequately streetwise, and where the tactics and commercial merits or demerits of any particular transaction were concerned, I find that he neither sought nor required any assistance, preferring to rely on his own judgment, which in fact he rated highly indeed.

In an expansive moment he described himself as the best property dealer in the world. Mr Edgar, throughout this case, has not been legally represented and has had the assistance of one, and even occasionally two, MacKenzie friends.

Mr Edgar was in fact cross-examined, albeit with commendable courtesy, for over six days, and during that period from an early stage a clear pattern of his attitude towards evidence in general and his evidence in particular emerged. I propose first to illustrate and to make my findings concerning this pattern by a fairly detailed dissection of the claim relating to La Talencia. Thereafter, since the pattern continued throughout Mr Edgar's evidence, it will only be necessary to deal with the other claims in a somewhat summary form."

17. The judge then dealt with particular aspects of the matter in relation to La Talencia and ended up with a damning indictment, in these terms, at page 11 of the transcript:

"By this time I regret to say it had become apparent that the more positive the assertion made by Mr Edgar the more certain it was that it would be almost instantly shown to be quite incompatible with other evidence, principally documentary."

18. He went on at page 13 line 35 to say:

"I have forborne to recite the complete list of untrue or wildly reckless assertions that Mr Edgar made for the simple reason it would take too long. From a very early stage during his cross-examination it became apparent that there was only one criterion which guided Mr Edgar during his evidence, and that was whether any particular assertion would assist his case. Since the truth would have had the reverse effect, with regret I have to say that I did not hear that precious commodity in relation to any significant issue. It follows that in relation to this and to the other claims, I am quite unable to accept Mr Edgar's evidence, and where it conflicts with that of Mr Stein or Mr Berger, from whom I have heard, I unhesitatingly accept the evidence of the latter two persons."

19. Those are findings in relation to credibility which the judge made after hearing cross-examination of Mr Edgar for over six days, and evidence from the defendants, Mr Stein and Mr Berger. That is the basis upon which the judge reached the conclusions of fact he did. It is that basis that Mr Edgar wishes to challenge.
20. The task therefore, as it seems to me at this stage, is to examine the findings of fact which Mr Edgar wishes to challenge on appeal, to look at the evidence which, as he says, ought to have led the judge to a different conclusion on each of those facts, to ask whether there is any real prospect that the Court of Appeal would be persuaded that the finding of fact was one which it was not open to the judge to make on the evidence before him and then to ask whether that would have made any difference to the outcome of the trial.
21. The first finding of fact - that is to say, the first passage in the transcript, which Mr Edgar seeks to challenge (as appears from the list of transcript extracts) is at page 9 of the judgment between lines 19 and 25. The passage reads:

"Such an agreement [that is an agreement that sale monies of the La Talencia flats instead of going to the bank should be placed in another company which would deal with London properties for sale] places Mr Taylor's conduct in a very questionable light, but I am not concerned with that save only in relation to his credibility. Of course the contract still had to state on its face that 70 flats were being sold, otherwise the bank would have discovered what was going on, but the reality was that if all 70 flats were indeed being sold there were obvious problems with title ..... "

22. In conjunction with that passage in the judgment Mr Edgar refers to a passage in the transcript of Mr Berger's evidence - that is 28th April 1999 page 23 lines 9 to 21 - and passages in the transcript of Mr Stein's evidence - on 27th April at page 7 line 14 and page 8 line 4. The first of those passages - that is Mr Berger at page 23 - is simply an extract of a letter from Mr Berger to Mr Stein written in or about June 1984. The transcript reads:

"A. It is my letter written to Mel Stein a few days later.

`I thank you for your letter of 8th June. We no longer have the old computer. All the information on the computer was run off prior to disposal and this only reflected accounts that were open at that time. As far as I'm aware all Brian's accounts had previously been closed and accordingly all that we would be able to do provide copies of the ledger cards as they existed at the time the files were closed. I do not know where these are kept but I can confirm that we do not hold them here. Perhaps you could let me know what transpires.'"

23. The passage in Mr Stein's evidence is rather longer. It starts at page 7 of 27th April 1999 (line 14) and runs through to page 8 at line 4. There is nothing in that passage, that I can see, which leads to the conclusion that the judge was not entitled to make the finding which he did make on page 9 of his judgment, namely that the contract had to state on its face that 70 flats were being sold otherwise the bank would have discovered what was going on. Mr Edgar has not been able to explain to me why that passage in Mr Stein's evidence has any relevance to the judge's findings.
24. The next passage in the judgment which Mr Edgar challenges is at page 16 line 7. That is a single line referring to the purchase of a property known as The Dormy House and some other properties from
25. Twentieth Century Banking Corporation by a shell company called Dotcrest for which Mr Berger had assured Mr Edgar he could arrange finance. In support of that there are various passages in the evidence - primarily from Mr Stein but also from Mr Edgar and Mr Berger. I have looked at those passages and I cannot see how they lead to the conclusion that the judge was not entitled to make the finding which he did note. The ultimate question for him was whether he believed Mr Stein and Mr Berger, on the one hand, or Mr Edgar on the other hand. It is plain from his judgment - particularly from the passages I have already read - that he preferred the evidence of Mr Stein and Mr Berger to the evidence of Mr Edgar.
26. The third and last group of passages in the judgment are at page 26 between lines 14 to 21. Those deal with the question of Mr Edgar's credit. The passages at pages 9, 10 and 11 are to the same effect, namely credibility, to that which I have already read; that is to saly the passage on page 11. It is said, by reference to evidence in Mr Edgar's transcript, that the judge ought not to have taken the view of his evidence which he did.
27. What Mr Edgar seems to have difficulty in accepting is that it is the task of a judge at a trial to decide which witnesses he believes and which he does not believe. In the discharge of that task, the trial judge has the advantage of hearing all the evidence and, in particular, of hearing and seeing the witnesses under cross-examination. It is an advantage which an appellate court does not have. It follows that, unless there is very powerful evidence from the transcripts that the view which the judge has formed of the credibility of the witness in front of him is perverse, the appellate court has no basis on which it can interfere. It must respect the judge's conclusions; reached as they are with the benefit of the advantage which he has and which the appellate court does not have.
28. In the present case there is no material that has been identified by Mr Edgar which could lead to the conclusion that the judge did not take advantage of the opportunity which he had to make an assessment of credibility after hearing Mr Edgar give evidence for over six days. There is no material which suggests that an appellate court would be in a position to substitute its own view for that of the judge.
29. I should make it clear that I have formed no view as to whether or not I would have reached the same conclusion as the judge on the material that appears in the transcripts. That is not my task. My task is to consider whether there is any real prospect of Mr Edgar persuading the Court of Appeal that the judge failed to make a proper assessment of Mr Edgar's evidence, given the advantage which he had.
30. I am satisfied that there is no real prospect of a successful appeal on that basis. In those circumstances the application to reinstate must be refused. The application to reinstate is refused because an application for permission to appeal would be bound to fail.
31. The effect is that the refusal of permission to appeal by Lord Justice Peter Gibson and Lord Justice Judge in December 1999 stands.
Order: Applications refused (Order does not form part of approved Judgment)