England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE STOCKPORT COUNTY COURT
(His Honour Judge Tetlow)

		Royal Courts of Justice Strand London WC2 Tuesday, 27th March 2001

1. LADY JUSTICE ARDEN: This is an application by Mrs Clarke for permission to appeal from the order of His Honour Judge Tetlow dated 27th October 1999, whereby he dismissed the applicant's application for permission to appeal against the order of District Judge Brazier dated 10th March 1999 for summary judgment in the sum of £54,156.86 and striking out the defendant's counterclaim. This application is by Mrs Clarke. She is one of the defendants in the action. The other defendant is her husband who is now bankrupt. Mrs Clarke has appeared in person and has put the points on her application to me herself.
2. Her first application, which is also in an application by letter received yesterday sent by her solicitors, is for an adjournment of this application on the ground that an application is presently before the Legal Services Commission for Mrs Clarke to obtain public funding (I quote from the letter sent by Parkington Holliday and Co):

"to obtain advice from a barrister on the merits of this appeal she has lodged and on the merits of applying to the court for leave to extend the grounds of appeal by pleading that the hearing on 17th October 1999 infringed Mrs Clarke's right to a fair trial now embodied in Article 6 of the Human Rights Act for the reasons set out in paragraph 3 of Mrs Clarke's notice of appeal dated 18th November 1999."

3. I will deal with the Article 6 point in due course.
4. The position is that this application was lodged on 15th November 1999 and it is much too late to apply for an adjournment on the eve of a hearing 16 months later. Mrs Clarke has told me that there was an application for legal aid for the hearing before Judge Tetlow, which was turned down, and that a second application for legal aid was made in the summer of 2000 but turned down in September 2000. Thereafter, it was resubmitted in November 2000. As I have said, the applicant has had plenty of time to obtain legal aid for the purposes mentioned in her letter if she was going successfully to obtain it, and there comes a point when the court cannot further delay the hearing of an application of this nature. It has to take into account the interests of both parties to these proceedings. I must reject the application for an adjournment and proceed to look at the grounds of appeal.
5. Mrs Clarke in her submissions has focused on the points regarding the accuracy of the representations made to her and her husband before they bought the property in question in this action, and also on the Article 6 point. But looking at the application notice, it is first stated that there was a failure by the judge to refer to a letter dated 30th May 1995. Unfortunately, the court only has a copy of the order of Judge Tetlow and not of the reasons for his judgment. The position is that Mrs Clarke has put in a statement of truth in which she seeks permission to adduce a number of further letters, not however one dated 30th May but one dated 29th May. I think it is to those letters that she must be referring. Secondly, the grounds of appeal refer to the desire to put in further evidence and, thirdly, the applicant says in her grounds of appeal that the defendants did not have the evidence with them at the time of the hearing before Judge Tetlow because they were representing themselves and were informed by the clerk of the court prior to the hearing that the hearing, which is the subject matter of this appeal, would only be an application for leave to appeal out of time and not a full rehearing of the evidence in the case. The applicants therefore did not have all their papers in court and were unable to call upon the evidence indicated in paragraph 2 above (that is the second ground of appeal) and such further statements which would have allowed Judge Tetlow to make the correct decision.
6. I turn to the background. This action is based upon a loan of £30,000 made to the defendants which was to carry interest at 12.5 per cent. In fact, the sum of £30,000 was the outstanding part of the purchase price of a public house in Ireland.
7. The defence in these proceedings is that the defendants (that is the applicant and her husband) were induced to buy a public house by negligent and false representations that the turnover for the year ended 31st August 1991 was £132,077 and that the public house would achieve a turnover of £130,000 per annum. There was also a counterclaim for loss and damage in the sum of £40,000, being the difference between the purchase price and the sale price. The plaintiff, now claimant, put in evidence that the turnover was indeed £132,077 per annum but that this was inclusive of VAT. He contends that the turnover was confirmed by an accountant's certificate and, in addition, by a statement of cash takings which was handed to the defendants. He said:

"I personally gave the defendants a copy of the weekly summary of takings, a further copy of which is now produced and marked 'MG 7' and annexed hereto to the defendants before they purchased the public house."

8. The claimant also says that the purchase from the defendants achieved a turnover of £164,000 excluding VAT in the year ended 31st March 1995.
9. So far as the bundle before the court is concerned, it appears that no evidence was put in on behalf of the defendants until the present application was made on 2nd March 2000. The applicant made a statement of truth on behalf of herself and also on behalf of her husband, Mr. Clarke. She says in that statement of truth that she and her husband were informed by a member of staff at the court office in Stockport by telephone that the hearing would only decide the application for permission to appeal and therefore they represented themselves. She went on to say:

"At the hearing Judge Tetlow informed us at the outset that he would hear the application and the appeal at the same time. We had no legal representation and further we did not have copies of all the evidence in our case as we had been informed that the full appeal would not be heard at this application. Therefore we did not have a complete file of all our papers. We did not believe that we would have been required to prove our entire case at this hearing due to the representations made to us by the court office in Stockport."

10. Then she states that she considers that their case should be heard in full again, allowing them time:

"To produce the following documents which we did not have with us at the hearing on 29 October 1999."

11. There are listed four further letters: first, a letter from her solicitors to the claimant's solicitors; second, a letter from her solicitors to the defendants; then a letter from her solicitors to a firm of accountants called Kit Noone, seeking independent certification of Dolphin's certificate (that is the certificate which had been produced by the plaintiff), and finally a letter from the accountants instructed by Mr. and Mrs Clarke. That is the letter of 29th March 1995. The concluding paragraph of that letter is as follows:

"In summary, therefore, we feel it was reasonable to give a turnover certification based upon the basic records, i.e. the cash book. We are 'reasonably satisfied' rather than 'entirely satisfied' with the figures as certified by Michael A. Dolphin. In order to be entirely satisfied one would need sight of all the records and bank statements of the previous owner."

12. They then do state that they are reasonably satisfied.
13. There is no skeleton argument in this case, so I have had to consider the defence as put forward in the proceedings, together with the further submissions made by Mrs Ckarke today. There is no evidence to support the argument that the statement of turnover given before purchase of the public house should have excluded VAT. On the contrary, the claimant's evidence showed that the defendants received a copy of the list of cash takings from which it should have been obvious that sales included VAT, and that position is in effect confirmed by Kit Noone, who say:

"... we feel it was reasonable to give a turnover certification based upon the basic records, i.e. the cash book."

14. As regards the second representation, the District Judge considered that it was not a false representation because of the certification that had been given in 1991 and of the ability of the purchaser from Mr. and Mrs Clarke to establish an increased turnover. I have reviewed the new evidence but, as I see it, that would not make any difference to the conclusions which have already been drawn in this action.
15. But Mrs Clarke today has told me that she wishes to raise a point that the defendants did not receive a list of the cash takings before purchase. This is obviously in conflict with what the claimant said in his affidavit of 27th January 1999. That particular affidavit was put in evidence a long time ago, and it was in evidence at the hearing before the District Judge on which the District Judge made the original order. As I see it, it is much too late now to seek to challenge that point. It should have been challenged before the District Judge and then it could have been challenged on appeal. It is clearly evidence which would have been available to the defendants to have adduced on those earlier occasions. There is no reason offered as to why it could not have been produced on those occasions.
16. The second point which Mrs Clarke has argued is that normally that is declared separately when declaring turnover. Again, there is no evidence on this point. If this had been a real point evidence could and should have been filed before the District Judge. It is too late to adduce that evidence now. Indeed, it is also in conflict with the way in which the certificate was drawn up by Michael A. Dolphin. That seems to be in accordance with normal accounting practice in the opinion of Kit Noone. There is the further point that if indeed it was normal practice, that normal practice would not have been relevant unless the defendants knew of it and relied on it.
17. Although Mrs Clarke has put the points forward persuasively today, they would not justify the grant of permission. I have been unable to identify a letter of 30th May 1995. I believe that it was one of the letters referred to by Mrs Clarke in her statement of truth. However, I have already dealt with those.
18. I have dealt with the question of the new evidence, ground 2. As regards ground 3, Article 6 of the European Convention on Human Rights referred to in Parkington Holliday's letter of 26th March 2001 to the court, the position is that that would not apply to found a defence in these proceedings because the order of the judge, on which Mrs Clarke founds this argument, was made before the Human Rights Act 1998 came into effect. Section 22(4) of the Human Rights Act says this:

"Paragraph (b) of subsection (1) of section 7 applies to proceedings brought by or at the instigation of a public authority whenever the act in question took place; but otherwise that subsection does not apply to an act taking place before the coming into force of that section."

19. These are not proceedings which are brought by or at the instigation of a public authority. Therefore, the concluding words of that provision apply, namely that that subsection does not apply to an act taking place before the coming into force of this section. Accordingly, I go back to 7(1)(b). That provides:

"A person who claims that a public authority has acted (or purported to act) in a way which is made unlawful by section 6(1) may -

(b) rely on the Convention right or rights concerned in any legal proceedings."

20. That provision will not apply because the order of the judge was made before the commencement of the Act. The commencement date was 2nd October 2000. Even if it had been a point, Mrs Clarke has had the option to refer me to the evidence which she would have wished to place before His Honour Judge Tetlow. She says that she does not have all the papers with her because she thought that the matter would be adjourned in the light of her solicitor's letter. I have endeavoured to point out that solicitors could not assume that there would be an adjournment. I have given her every opportunity and I have also considered the papers myself. I do not think that there is any real prospect of success on appeal. Therefore, I decline permission.
21. I should also add that this is a second appeal and therefore the higher hurdle in O.52,r.13 would have to have been satisfied in any event.
Order: Application refused.