England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM KINGSTON COUNTY COURT
(HIS HONOUR JUDGE MORGAN)

		Royal Courts of Justice Strand London WC2 Tuesday, 24th April 2001

Tuesday, 24th April 2001

1. LORD JUSTICE MUMMERY: This is an application for permission to appeal against an order of His Honour Judge Morgan siting in the Kingston County Court on 14th June last year. In accordance with the terms of his judgment he made an award of damages against the defendant, Mr Mills, in favour of the claimants, Mr and Mrs Turp totalling (including interest) £25,382.22. He dismissed a counterclaim by Mr Mills and ordered him to pay costs. He refused Mr Mills' application for permission to appeal.
2. On the hearing of the application today Mr Mills explained that he wished to be represented by a friend, Mr Gubby; and Mr Gubby explained that he has been giving help for some time to Mr Mills, including assistance in the preparation of a written skeleton arguments.
3. Before deciding whether or not to grant permission to appeal I must emphasise the test that has to be applied and then apply that test to the facts of the case. Permission to appeal is only granted if the appeal has a real prospect of success. If the appeal is against findings of fact it is particularly difficult for an applicant to satisfy the court that on the appeal there is a real prospect of successfully upsetting the judge's findings of fact, in so far as they are based on his views about the credibility of witnesses who have given evidence before him.
4. The background to this case is that Mr Mills, who was the defendant in the proceedings and is the applicant for permission to appeal, owned land at No.148 Chertsey Lane, Staines, Middlesex. In the middle of 1996 he was in the course of building a house on that plot. On 11th July 1996 he entered into an agreement with the claimants, Mr and Mrs Turp, to sell them the property for £183,000. The completion date was fixed for 26th July 1996. Mr and Mrs Turp started proceedings on 11th March 1998 claiming damages against Mr Mills for failure to complete the building so as to be in a habitable state by the completion date. They also claimed damages for a number of items that were left unfinished and for defects in the construction of the property. The detail of those were set out in a schedule prepared by a chartered surveyor, Mr J K Hayes. In April 1998 the solicitors then acting for Mr Mills, a firm called Barlows, served a defence and counterclaim.
5. The trial came on before His Honour Judge Morgan in June and he arrived at the figure of £25,382-odd by going in detail through the various entries in the Scott Schedule. He gave detailed reasons in his careful judgment for finding Mr Mills was contractually liable for those sums. He did not accept all the evidence that was given by Mr and Mrs Turp. In particular he did not accept that they moved into the property on the completion date on 26th July. The judge said (at pages 1 and 2 of his judgment) that it became clear early on in the hearing that, as alleged by Mr Mills, they had moved in earlier, on 19th July. The judge pointed out that the recollection of Mr and Mrs Turp on that important point had proved to be unreliable.
6. As regards the items in the schedule, however, the judge relied not only on the evidence of the parties but also on the evidence of experts, including Mr Hayes and Mr Richens, a builder, who gave evidence on behalf of Mr Mills.
7. In relation to the application for permission to appeal Mr Gubby has made a number of points on behalf of Mr Mills. These points are foreshadowed in a draft amended defence and counterclaim (which is in the bundle at pages 174 to 180) in which allegations are made that Mr and Mrs Turp were guilty of dishonesty in falsifying the deed of transfer by having it backdated to 23rd July 1996 (that is three days before the completion date), when the fact of the matter was that no transfer of any kind took place until 12th August 1996. It is alleged that this falsification of dates was done without the Mills' knowledge and that this has an impact on the entitlement of Mr and Mrs Turp to recover damages. Mr Gubby said that this material alteration in the deed disentitled Mr and Mrs Turp from pursuing their claim. He cited a passage in Chitty on Contracts relating to the execution of deeds, paragraph 20.010, in which it is said by reference to the case of Ellesmere Brewery Co v Cooper [1896] 1 QB 75, that:

"A material alteration made in a deed after its execution, without the consent of the parties, avoids the deed to the extent that the covenants contained in it cannot be enforced by a party who made the alteration or whose servant or agent made it."

8. So, submits Mr Gubby, the act of backdating by Mr and Mrs Turp and their solicitors means that the transaction obligations are not enforceable by Mr and Mrs Turp. They are disqualified (his words) from alleging that Mr Mills has acted in breach of contract. The work which had been done or was contracted to be done by Mr Mills was part of the transaction relating to the title and therefore fell within the principle quoted from Chitty.
9. The point was also made that Mr and Mrs Turp had been guilty of dishonesty in relation to application for legal aid. That had been obtained by them, it was alleged, on the basis that they were receiving job seekers allowance and income support, when they were in fact both directors of a company called East City Builders Limited.
10. Mr Gubby's skeleton argument went on to allege that the judge's decision on Mr Mills' liability to Mr and Mrs Turp was perverse. He reminded me that in certain respects the judge himself had held the evidence of Mr and Mrs Turp to be unreliable.
11. I have considered these arguments which raise serious allegations about the conduct of Mr and Mrs Turp. I have also considered Mr Gubby's point that Mr and Mrs Turp did not have clean hands in this matter and that the matter is of serious concern to Mr Mills not only because of the size of the award of damages against him but also because of the size of the bill of costs which has been submitted. He also pointed out that the Turps had originally made a claim in excess of £41,000 and the judge had rejected a substantial part of that in reducing the total liability including interest to £25,382-odd.
12. I have taken all these matters into account, not least the serious charges of illegality. I have to point out, however, that these allegations were not in the pleadings before the judge at the date of the trial last year. The document which I have been shown is a draft amended pleading which says at the end of it, "amended 2nd April 2000 pending leave of the court." It does not seem from the documents that leave was asked for or obtained from His Honour Judge Morgan. I would go further, however, and say that, having regard to the draft amendments set out in paragraph 11 of the defence, I have formed the view that the matters complained of do not provide a defence to the claims made against Mr Mills. I note Mr Gubby's submissions that the claims are made on or arise out of the deed of transfer which is alleged have been falsely backdated. It is clear from the pleadings in the state in which they were at the time of the trial that what was being sued on by Mr and Mrs Turp was a contract made with Mr Mills prior to the deed of transfer. It is alleged in the particulars of claim to be a written contract dated 11th July 1996 and as part of that the defendant agreed to carry out the construction of the house and to complete it by 26th July.
13. In the defence and counterclaim of Mr Mills it is submitted that the agreement for purchase was made partly orally and partly in writing in the circumstances set out in his pleading. It is said by Mr Gubby that in certain respects the pleading does not tell the whole story because, as regards the sum of £23,000 which was held by Mr Mills' solicitors pursuant to an agreement with Daybells (who were the Turps' solicitors), Mr Gubby alleges that there was some dispute not mentioned in the pleadings between Mr Mills' solicitors, Barlows, and Mr Mills about the payment of fees. Mr Mills told Barlows that they could use the money that was retained by them and Barlows' response was that they were not in a position to use that money by reason of an agreement with the Turps' solicitors.
14. The view which I have formed about this is that all these alleged irregularities were not part of the pleaded case on which the trial was conducted. They do not seem to me to affect the basic obligation of Mr Mills to carry out the contract which preceded the transfer, that contract being to construct the property by the completion date and to construct it in a proper fashion. What has given rise to the liability to pay the sum of damages is his failure to complete by the agreed date and the fact that there were defects in the construction, as well as delays, which have given rise to loss suffered by the Turps.
15. As for the alleged irregularities in the obtaining of legal aid, that is not a matter which gives any real prospect of success to the appeal. If there has been some false statement made for the obtaining of legal aid, that is a matter which Mr Mills is entitled to report to the appropriate authorities. It does not seem to me that it is a matter that affects the correctness or otherwise of the judgment entered against him.
16. As for the argument the judge's decision was perverse the judge himself pointed out that some of the claimants' evidence was unreliable. I have formed the view that the judge was entitled, on the basis of the evidence which he heard and the materials which were before him, including expert evidence, to reach the conclusions of fact that he did that gave rise to the liability to pay damages for delay and defects in construction. I think that it is highly unlikely that this court would disturb the judge's findings of fact. In order to do so it would be necessary to conduct what would be tantamount to a retrial in this court, when under the Civil Procedure Rules the role of this court is in general limited to carrying out a review of the decision of the court below.
17. For those reasons this appeal has no real prospect of success either on the points made by Mr Gubby in his submissions today or on points in the skeleton argument.
18. The application is refused.
(Application refused; no order for costs).