England and Wales Court of Appeal (Civil Division) Decisions

		Neutral Citation Number: [2002] EWCA Civ 1100
		Case No: A1/2002/0548

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM CARDIFF COUNTY COURT
(His Honour Judge Moseley QC)

		Royal Courts of Justice Strand, London, WC2A 2LL
		30th July 2002

B e f o r e :

LORD JUSTICE SIMON BROWN (Vice-President of the Court of Appeal Civil Division)
LORD JUSTICE MANCE
and
LORD JUSTICE LATHAM
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Between:


	MICHAEL JOHN MILLER (t/a WATERLOO PLANT)	Claimant/ Respondent
	- and -
	MARGARET CAWLEY	Defendant/ Appellant

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(Transcript of the Handed Down Judgment of
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Milwyn Jarman Esq,QC & Emyr Jones Esq. (instructed by Messrs Dilwyns) for the Appellant.
Alaric Watson Esq. (instructed by Messrs D J Murphy) for the Respondent.
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HTML VERSION OF JUDGMENT
AS APPROVED BY THE COURT
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Crown Copyright ©

Lord Justice Mance:

1. This judgment contains my reasons for the decision announced by the court at the hearing of this appeal on 19^th July 2002.
2. The case is an odd one, and has gone wrong at some points. The claimant Mr Miller, who is the respondent before us, claimed sums due for work done in 1998 on a property called White Walls, Llangattock, Crickhowell, in which the defendant Mrs Cawley, who is the appellant before us, proposed to live with her young son. The house is, it appears, registered in the name of a company, Crawley Corporation Limited, owned by her two older sons. The claimant said that the defendant held herself out as owner of the house, and gave him the instructions for extensive building works, for which the claimant remains unpaid. Her case was that she gave no such instructions, and for good measure that instructions for the works were given by her two sons on behalf of their company.
3. On 21^st December 2001 a preliminary issue was ordered as to whether or not there was a contract between the claimant and the defendant relating to the construction work at White Walls. This issue was tried on 21^st/22^nd February 2002 before HHJ Moseley QC. The claimant gave evidence as did two of his workmen. At the conclusion of the evidence called for the claimant, the following exchanges took place between counsel for the defendant and the judge:

“MR. REED: Your Honour, my client is considering a submission of no case to answer in the light of the evidence that emerged yesterday. Can I invite your Honour to indicate at the outset whether if a submission were to be made you would invite my client to elect at this point in time?

JUDGE MOSELEY: Yes I would. The law about that has changed. There has been a recent decision of the Court of Appeal which says the judge should put a person submitting no case to answer on his election, except in exceptional circumstances, as I recollect it.

….

JUDGE MOSELEY: There used to be a discretion, and judges' attitude to submissions used to vary, but now the principle has all solidified somewhat as a result of this Court of Appeal decision. So the answer is, yes, if there were a submission, I would have to.

MR. REED: I am obliged. Your Honour, could I invite you to allow me to turn my back for a moment?

JUDGE MOSELEY: Yes of course.

MR. REED: Your Honour, I am very gratefu1. My client elects that she and her witnesses will not give evidence.

JUDGE MOSELEY: Right. So the only evidence we have is the evidence that I have already.

MR. REED: That is right, your Honour, yes.”

4. The case which the judge had in mind, but of which no full transcript was put before him, was evidently Boyce v. Wyatt Engineering [2001] EWCA Civ 692, as summarised in the CPR News Issue 10/01 of Dec 17, 2001.
5. After a short adjournment, counsel introduced his submissions as follows:

“Your Honour, the submission is one of no case to answer based on the fact that realistically there is no prospect of the claimant proving his case on the evidence that has been put before the court thus far.”

6. Throughout his submissions counsel adopted the same test, concluding them as follows:

“It is therefore my respectful submission that when one looks at all of these factors, the evidence of the claimant is so vague on certain matters and so untruthful on others that he could not be believed, and because he could not be believed, there could not be any reasonable prospects of him establishing liability against my client.

JUDGE MOSELEY: I am a bit unhappy about that formulation of the test. You are submitting that there is no case to answer, and you seem to be putting forward an application based on ....

MR. REED: Perhaps I should use the proper formulation of whether realistically there is no basis upon which a jury could, properly directed, find in favour of the claimant on the evidence that he had adduced, your Honour of course being in the role of the jury in this case.

JUDGE MOSELEY: That comes from some decided case, does it?

MR. REED: Your Honour, I have taken that terminology from the updated articles which come from the white book. There is a recent feature on submission of no case to answer. I have taken that from the wording there. It says this, your Honour:

‘The traditional submission of no case to answer test is whether realistically there is no basis upon which a jury could, properly directed, find in favour of the claimant on the evidence that he has adduced. As most civil cases are now tried without a jury, the question is in effect whether there was no such case for the judge to put to himself wearing a jury hat.’

Your Honour, that is taken from Bentley v Joan (sic) Harris [2001] EWCA and it is 2nd November 2001.

JUDGE MOSELEY: Thank you.

MR. REED: Those are my respectful submissions, unless I can assist you further.”

7. The judge gave a judgment, in which he applied the test which counsel for the defendant had advanced. He thus asked himself throughout whether there was any or any real prospect of the claimant succeeding (or any case fit to go before a jury, or before himself wearing his jury hat). Having decided that there was such a prospect, he simply stated, without any further consideration of the matter, that “Mr Miller has proved the PI and that there was a contract with Mrs Cawley”. I set out the whole concluding passage (TR p.59D-G, bundle p.151):

“Mr Miller was not the best of witnesses. There were contradictions in his evidence. He did not concentrate on the questions put to him and gave answers which had not been asked. Nevertheless it would be a bold judge who would say that realistically there were no prospects of any jury being able to find in his favour, and in my view, I am unable to come to that conclusion. It seems to me in those circumstances that I ought to reject the submission of no case to answer. So the conclusion I come to is that Mr Miller has proved the preliminary issue and that there was a contract with Mrs. Cawley.”

8. Against that decision, permission to appeal was sought by the defendant on the grounds (inter alia) that the judge (a) was wrong to put the defendant to her election, and (b) failed correctly to consider and apply “the test applied on submissions of no case to answer, namely, whether realistically there is no basis upon which a jury could, properly directed, find in favour of the claimant on the evidence that he had adduced”. Nowhere was it suggested that the test advanced by counsel for the defendant and applied by the judge was itself wrong.
9. However, when Kay LJ gave permission to appeal, he made these observations:

“Despite research I have not identified the case upon which the judge purported to rely despite the fact that he could not identify it. It may have been Boyce v Wyatt Engineering (2001) The Times 14th June.

However, whether or not the applicant should have been made to elect, I consider that there is [a] potentially more fundamental flaw and that is the test applied by the judge to decide the case. Once the Defendant had elected not to call evidence, the judge had to decide on a balance of probabilities whether he, as the tribunal of fact, accepted the evidence of the claimant or not. It was not then for him to decide whether ‘there were no prospects of any jury being able to find in his favour’.

If it was completely clear that the judge accepted the complainant's case, this would not matter but his acceptance of the weaknesses in the claimant's case (see transcript page 59 a-e (bundle pg 151)) and the failure to reach his own finding of fact arguably amount to a failure to decide the case on the proper basis. In this regard it appears that both counsel may have been similarly at fault.

I do not limit the grounds upon which you may appeal because the court will look at the entirety of what happened but counsel would be well advised to focus on the points that really matter.”

10. Fresh counsel instructed on behalf of the Defendant has without objection pursued amended grounds of appeal and advanced the new point raised by Kay LJ.
11. In my judgment, there is no answer to this appeal, as regards the judgment entered against the defendant. The claimant faces Morton’s fork. If it was appropriate to put the defendant to her election, then it was inappropriate thereafter to apply as the test of success or failure of the claim whether the claimant had “any reasonable prospect” of establishing liability on the part of the defendant. If, on the other hand, it was appropriate to apply this test (being the test that counsel for the defendant advanced from the outset), then it was inappropriate to put or hold the defendant to her election.

Submission of no case to answer

12. The determination by a judge of fact of a submission of no case to answer without putting the defendant to any election to call no evidence has been likened to the determination of a pre-trial application under CPR Part 24.2 on the basis that the claimant has no real prospect of success: cf Bentley v. Jones Harris & Co. [2001] EWCA Civ 1724, per Latham LJ at para. 75. The differences in context mean that the analogy may not be precise: for example, a judge pre-trial may make allowances for the possibility of development or amendment, whereas, by the close of a claimant’s case, that case and the evidence supporting it will have been definitely identified. But it is clear that in some circumstances a submission of no case to answer at the close of a claimants’ case can be appropriate and may, in the exercise of the judge’s discretion, be entertained without the defendant being put to his or her election – cf both Bentley itself and Boyce v. Wyatt Engineering [2001] EWCA Civ 692, per Potter LJ at para. 36 (last 31 words). Some flaw of fact or law may, for example, have emerged for the first time, of such a nature as to make it entirely obvious that the claimant’s case must fail, and it may save significant costs if a determination is made at that stage.
13. However, as I said in Boyce, considerable caution is necessary before a judge entertains such a submission or undertakes such a determination, without requiring any election. The trial is now in progress, and although the test (no real prospect) differs from that applicable after hearing all possible evidence (balance of probability), caution is dictated for reasons along the lines indicated in paras. 4-6 in my judgment in Boyce. The submission interrupts the ordinary trial process, and it is not desirable that, during that process, the judge of fact should be put in a position where he may find himself having to express first an initial view on the basis of the claimant’s evidence alone and then (if he allows the claim to proceed) a further final view after taking into account further evidence, even though he does so by reference to different tests. There may be cases, as I pointed out in Boyce, where this consideration is of less force, because nothing in the defendant’s evidence could affect the view taken of the claimant’s evidence or case. But there is also the second and very important consideration that, if the judge rules that the claimant’s evidence does not show a real prospect of success (whether this is for reasons of fact or law), he may prove wrong on appeal. In that event, the procedure adopted will prove to have caused much unnecessary cost, involving a re-trial (quite likely before a different judge, as was ordered in Boyce). It was considerations like these that led, as explained in Alexander v. Rayson [1936] 1 KB 169, 178-179, to the general practice of entertaining applications at the close of the claimant’s case in a civil trial only on the basis of an election by the defendant to call no evidence (in which event the position becomes as stated in paragraphs 17-18 below).
14. Where a judge does, however, embark at the close of the claimant’s case on a determination whether the claimant’s case has no real prospect of success without requiring any election, the judge will, if he determines that the claimant’s case has no such prospect, dismiss the claim, and this will, subject to any appeal, be the end of the matter. If, on the other hand, the judge determines that the claimant’s case has a real prospect of success, he must go on to hear the defendant’s evidence and thereafter to find the factual position on the whole of the evidence and on the balance of probabilities.

Applications on any other basis

15. Suggestions have been made that it is open to a judge, at the close of a claimant’s case and without requiring any election by the defendant to call no evidence, to determine whether or not the claimant has on his own evidence made out his case on the balance of probability. The heightened objections which exist to any such course, having regard to the two considerations mentioned in paras. 4-6 in Boyce, are obvious. A refusal to dismiss the claim applying a standard of probability would imply that the judge was satisfied with the credibility and reliability of the claimant’s case on the balance of probabilities, without having ever heard any contrary evidence which the defendant, in the absence of any election, would remain free to call. As this court said in Alexander v. Rayson:

“…. We cannot think it right that the judge of fact should be asked to express any opinion upon the evidence until the evidence is completed. Certainly no one would ever dream of asking a jury at the end of a plaintiff’s case to say what verdict they would be prepared to give if the defendant called no evidence, and we fail to see why a judge should be asked such a question in cases where he and not a jury is the judge that has to determine the facts.”

16. Further confirmation of the continuing validity of this attitude is provided by this court’s analysis of the position under the Civil Procedure Rules in The Royal Brompton Hospital National Health Service Trust v. Hammond (Case A1/2000/3495; unreported 11^th April 2001). The court there was concerned with the different context of a trial judge who took time to read the papers and after doing so purported to decide that the claimant’s case taken as its highest did not in certain respects satisfy the onus of proof on the balance of probabilities, and struck it out in those respects. This court held that that was an inadmissible exercise, not contemplated by the rules. The rules contemplate pre-trial applications on the ground that the statement of case discloses no reasonable grounds for bringing a claim (CPR3.4) or the claim has no real prospect of success (cf CPR Part 24 and also 3PD.1.7 and 3PD.6 and 26PD.5), but, failing a successful pre-trial application of that nature, the trial should take its ordinary course (cf especially per Aldous LJ at para. 21 and per Clarke LJ at para. 105). Its ordinary course may, as I have explained in paragraphs 12-14, include a submission of no case. But it should not involve an attempt to ask the court at the half-way stage, without any election, to perform a role (assessing the balance of probabilities) which should be reserved until after the conclusion of all the evidence.

The position where a defendant is put to election

17. Where a defendant is put to his or her election and elects to call no evidence, the position is quite different. As I said in Boyce at para. 4:

“First, where a defendant is put to his election, that is the end of the matter as regards evidence. The judge will not hear any further evidence which might give cause to reconsider findings made on the basis of the claimant’s case alone. The case either fails or succeeds, even on appeal.”

18. The issue after an election is, in other words, not whether there was any real or reasonable prospect that the claimant’s case might be made out or any case fit to go before a jury or judge of fact. It is the straightforward issue, arising in any trial after all the evidence has been called, whether or not the claimant has established his or her case by the evidence called on the balance of probabilities.

The present appeal

19. The present appeal has been helpfully argued by counsel on each side, none of whom appeared below. Mr Jarman QC for the appellant submits that the judge was wrong to put the defendant to her election, and in particular that he did not exercise any discretion or exercise it on the basis of the right test. The judge took the view, as appears above, that a defendant should be put to his election, “except in exceptional circumstances”. That phrase does not accurately reflect what was said in Boyce, but I think it most improbable that the judge would have reached any different decision if he had addressed the precise test or all the considerations stated in Boyce. The trial was already in its second day. The defendant had challenged the credibility and accuracy of the account given by the claimant and his witnesses. The stage had been reached when the defendant had in the ordinary course to put before the judge her own evidence on a relatively straightforward issue of fact. The whole of the evidence would then rapidly have been completed, after which the judge could have performed once and for all his fact-finding role. Instead, the defendant preferred to try to dispose of the case without completing the evidence, introducing at least some risk that, if she was initially granted the relief she sought, a successful appeal might lead to a re-trial. I observe that the defendant was under no obligation to pursue her application once the judge put her to her election. However, despite advancing a test (did the claimant have a reasonable prospect of success?) which was over-favourable to the claimant, the defendant chose to pursue her application. In these circumstances, I see no basis for disturbing the judge’s ruling that she should be put to her election.
20. Having put the defendant to her election, the judge applied (albeit at the defendant’s invitation) a test which was too favourable to the claimant. I have already indicated agreement with Mr Jarman’s submission that the judgment entered against the defendant cannot therefore stand. Mr Watson for the claimant argued valiantly, though always realistically, that the judge must have engaged in a two-stage thought process – considering first whether there was a case with a sufficient prospect of success to go before him as the tribunal of fact and second what his decision was as the tribunal of fact on the balance of probabilities. There is however no trace of any such second stage at any point in the submissions before him or in his judgment. Further, there is no reason for any such two-stage process, once a defendant has elected to call no evidence. As I have pointed out in paragraphs 17-18 above, the only issue then becomes whether in the light of the evidence already adduced the claimant has made out his case on the balance of probabilities, and that was the test (more favourable to the defendant) which the judge ought to have been invited to apply.
21. Neither party suggested that we could or should ourselves in this court attempt to apply the correct test by reference to the transcript in a case which was the subject of contentious oral evidence. Mr Jarman submitted that there should be a re-trial, preferably before a new judge. At any such re-trial, the claimant would have to give and adduce the evidence in support of his case once again, while the defendant would be free of her election at the first trial to call no evidence and would, moreover, have the advantage of the transcript from the first trial of the evidence adduced by the claimant, which could be used for preparation and cross-examination. Mr Watson submitted that a re-trial would in these circumstances not only be very costly and time-consuming (whoever bore the cost), but also unfair. He contended that the case should be remitted for HHJ Moseley to determine whether the evidence called by the claimant justified a finding that the claimant had on the balance of probabilities contracted with the defendant. The defendant, Mr Watson pointed out, chose to call no evidence and to seek to dispose of the claim on a basis that was significantly less favourable to her than the basis on which HHJ Moseley would now be required to rule on any such remission. Had she or her counsel appreciated what the correct test would have been after election, their readiness to elect could only have been enhanced. She should not in these circumstances be given an opportunity to resile from her election, particularly when the present situation has arisen from her own adoption (albeit with the claimant’s unsurprising concurrence) of a wrong test. Further, since the judge had made quite clear in his previous judgment that he was only deciding that there was a case with a real prospect of success (or fit to go before a tribunal of fact), and had expressed a number of reservations about the claimant’s evidence, there was no question of the judge having pre-judged any issue arising on the balance of probabilities. In addition, no very great period of time has elapsed since the judge’s ruling, bearing in mind the adjournments that do sometimes occur in the County Court; there was a full transcript of the whole proceedings so far before the judge; and the claimant had by open letter on 12^th June 2002 offered to agree to the appeal succeeding on the basis that the matter would be remitted to the judge for submissions and his finding on the balance of probabilities.
22. Balancing all these factors, and not without some initial hesitation, I have concluded the right course to be that advocated by Mr Watson, and that it is not asking too much of the judge to remit the matter to him to hear further submissions and to re-consider the position on the balance of probabilities on the basis on the election already made and the evidence already called. I would accordingly order that the appeal be allowed against the judgment entered and that the case be remitted to HHJ Moseley for him to hear further submissions on that basis applying the correct test of the balance of probabilities, and to determine the outcome of the case accordingly.

Lord Justice Latham:

23. I agree.

Lord Justice Simon Brown:

24. I also agree.

ORDER: Appeal allowed against the judgment entered. Costs below for determination by the judge after re-consideration of the fresh issue. The appellant to pay the respondent’s costs of the appeal, to be assessed if not agreed.

(Order does not form part of the approved judgment)