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 CHANCERY DIVISION
(MR JUSTICE HART and MR JUSTICE JACOB)

		Royal Courts of Justice Strand London WC2 Wednesday 17 July 2002

1. LORD JUSTICE CHADWICK: These applications were listed for hearing at 10.30am this morning. Shortly before that hearing was due to commence, the Civil Appeals Office was informed by telephone that the applicants would arrive at 11.30am and not at 10.30am. No reason was given. In the circumstances the court sat at 10.30am; but the applicants not being presented, I adjourned these applications in order to give them the opportunity to attend at 11.30am in accordance with their stated intention. It is now 11.35am. The applicants are not present; no further message has been received by the Civil Appeals office and it is now necessary to decide whether to deal with these matters in the absence of the applicants or to adjourn them indefinitely to some time at which they will find it convenient to attend.
2. The first two applications are applications for permission to bring a second appeal to this court. They must therefore surmount the hurdle posed by CPR 52.13. I have had the opportunity to read the very substantial papers which have been placed before the court; I have formed a clear view that the applications must be dismissed; and I propose to deal with the applications in the absence of the applicants.
3. The first applicant, Mr Victor Samuel Tassell, was adjudged bankrupt by an order made on 28 February 2001 in the Southend County Court. His wife, Mrs Marie Hetty Tassell, the second applicant, was adjudged bankrupt by an order made on 4 April 2001 in the same court. Each of them appealed, as was their right under section 375(2) of the Insolvency Act 1986 and rule 7.48(2) of the Insolvency Rules 1986, to a single judge of the High Court. Those appeals came before Hart J on 12 December 2001. He dismissed both appeals. Mr and Mrs Tassell each seek permission to appeal from those orders.
4. Mr Tassell lodged his appellant's notice on 8 January 2002. His application was given Court of Appeal reference 2002/0050. Mrs Tassell lodged her appellant's notice on 19 March 2002. Her application was given Court of Appeal reference 2002/0580. The grounds of appeal set out in each of those notices are in identical terms. Each of the applications for permission to appeal are accompanied by ancillary applications seeking other forms of relief. In Mr Tassell's case, there is an ancillary application (under 0050/A) for directions for a referral to the European Court of Justice. In the same matter (under reference 0050/B), there is an application for an extension of time. In Mrs Tassell's case there are identical applications for a referral and for an extension of time; and, in addition, an application for disclosure and permission to join a party to the proceedings.
5. For the purpose of these applications, the underlying facts can be stated shortly. The bankruptcy orders were made on the petitions of National Westminster Bank Plc, presented on 3 January 2001. The debt upon which the petitions were founded was £29,564.61 - that being the sum said to be due under a summary judgment of 16 March 1999 obtained by the bank against Mr and Mrs Tassell in proceedings in the Southend County Court (case reference BS 754250). That judgment debt had been the subject of statutory demands served on behalf of the bank on 3 February 2000. The debtors had applied under rule 6.4 of the Insolvency Rules 1986 for orders to set aside the statutory demands. Those applications were dismissed by the district judge on 6 July 2000. Appeals against his orders were dismissed by Mr Nigel Davis QC, sitting as a deputy judge of the High Court in the Chancery Division, on 16 November 2000. Permission to appeal from the orders of 16 November 2000 was refused by Robert Walker LJ, sitting as a single judge in this court on 26 February 2001. The bankruptcy order against Mr Tassell followed two days later, and that against Mrs Tassell some six weeks after that.
6. It will be apparent, therefore, that these bankruptcy orders were made on the basis of an unpaid judgment debt; following the service of statutory demands; and after the procedure for setting aside those statutory demands had been exhausted, ultimately by the failure of an application for permission to appeal in this court.
7. But that is not the complete picture. For a fuller account of the background, and the circumstances in which the judgment of 16 March 1999 came to be entered without a trial, reference should be made to the judgment of Evans LJ (sitting with Sedley LJ in this court on 19 October 1999) on applications 1999/5971 and 1999/6249, the judgment of Pill LJ (sitting with Mummery LJ in this court on 14 April 2000) on application 1999/7710 and the judgment of Robert Walker LJ on the application to which I have already referred (application 2000/3605) on 26 February 2001. There is no doubt that Mr and Mrs Tassell have a deep sense of grievance arising out of the way in which they feel they have been treated by the bank. That is now coupled with a feeling that they have not been treated fairly by the courts. But, as Pill LJ pointed out in paragraph 11 of his judgment on 14 April 2000, there must be an end to litigation. He said this:

"While giving all the understanding I can to the strongly felt views of Mr and Mrs Tassell, I cannot find it arguable that the same matter can successfully be relitigated before this court. Any system of justice must include a concept of finality. However strongly losing parties in litigation feel, under the rule of law no system can operate whereby decisions of the court are repeatedly challenged by requests to hear the same issue as has been determined by a court of competent jurisdiction with a right of appeal also having been exercised."

8. That is how it appeared to Hart J on 12 December 2001. After setting out, in some detail, the history of litigation between the bank and Mr and Mrs Tassell, he said this at page 6F of the transcript of his judgment:

"Accordingly, I am left in the position where the Registrar has made an order based on a valid statutory demand, itself based on a valid judgment, and there are, there is simply no basis upon which I am entitled to look back behind that judgment and go into all the facts which Mr Tassell would wish me to go into. In the course of his address, he has taken me to a number of matters which, he says, shows that the bank were quite capable of making mistakes. And he submits that, without at some point the court going into the matter in detail on the basis of all the documentation, it is simply unfair for him to be saddled with what he regards as the besmirching of his name by his being adjudged bankrupt.

The position, indeed, is that the court has not at any stage when giving its judgment against Mr Tassell done so upon a full investigation of the whole history of his account. It has done so on the basis of summary applications by the bank, it being satisfied on the evidence before it that it was appropriate to do so, and Mr Tassell has on each occasion had, and taken, his opportunity to seek relief from the Court of Appeal in respect of the judgments against him. It is the case that the court does have power to make judgments on the basis otherwise than on a full trial, and that is what has happened on this case. The consequence is, where the court so acts, that the litigant may well feel deprived of an opportunity fully to investigate how it is that he finds himself in the position of having a judgment against him.

As I have tried to indicate, that is not something that I think this court, on an appeal from a bankruptcy order, is in a position to cure."

9. The judge took the view that, on the material before him, there was no basis upon which he could interfere with the bankruptcy orders made (as they were) on a judgment debt following service of a statutory demand which the debtors had failed to have set aside.
10. The underlying problem in this case, as the judge identified, is that Mr and Mrs Tassell feel strongly that that judgment debt should never have been entered. But, as the judge pointed out - and as the history of this litigation shows - that is a question which has already been resolved against Mr and Mrs Tassell by every court that has considered it, including this court.
11. The applications now made to this court fall within CPR 52.13. They are applications for permission to appeal against orders of the High Court which were themselves made on an appeal from the lower court. Permission cannot be granted unless this court is satisfied that the appeals would raise some important point of principle or practice or that there is some other compelling reason why a second appeal should be entertained by the Court of Appeal - see section 55(1) of the Access to Justice Act 1999. I therefore turn to the grounds of appeal, set out under sections 7 of the appellant's notices, to see whether that test is met.
12. The grounds of appeal each comprise 11 paragraphs. The first paragraph, which is uncontroversial, asserts that CPR 52.11(3)(b) provides that an appeal will be allowed where the decision of the lower court was "unjust because of a procedural or other irregularity in the proceedings in the lower court". Paragraph 2 amplifies that by explaining that the Court of Appeal has power to intervene where there has been a serious or other procedural irregularity which has caused injustice.
13. Paragraph 3 asserts, as is plainly correct, that Article 6 of the Convention on Human Rights confers rights to a fair and public trial. Paragraph 4 refers to the appeal provisions in the County Court Act. Paragraph 5 describes the constitution of the Court of Appeal under the Supreme Court Act 1981. Paragraph 6 refers to the Convention rights under Article 6 and to the right under Article 8 to respect for private and family life. Paragraph 7 has not been included. Paragraph 8 refers to the right of appeal in insolvency proceedings which Mr and Mrs Tassell have exercised in the present case.
14. Paragraph 9 is in these terms:

"The appellant claims within the Human Rights Act 1998 within Article 34 of the Convention, being a 'victim' of an unlawful act in regards to (i) 'prejudice' (ii) 'oppression' (iii) 'bias' within the bankruptcy proceedings in judicial acts within section 7(1) of the Act and exercising right of appeal section 9(1) and 9(1)(a)."

15. Paragraph 10 refers to an article by Lord Lester of Herne Hill QC and Mr David Pannick QC in (2000) 116 LQR explaining the importance of the court "weaving the Convention rights in to the principles of common law". Paragraph 11 refers to the obligation under section 3 of the Human Rights Act 1998 to read and interpret primary legislation in a way which is compatible with the Convention rights. Paragraph 12 points out that this is an appeal against the decision of the Chancery Court in bankruptcy for the court to consider that the appellant would have a real prospect of success or that there is some other compelling reason why the appeal should be heard. That overlooks the requirement introduced by section 55(1) of the Access to Justice Act 1999 and now embodied in CPR 52.13 in relation to second appeals.
16. The substance of the complaint lies in paragraph 9 - in which the applicants assert that they did not have a fair trial because they have been the victims of prejudice, oppression or bias within the bankruptcy proceedings. The grounds of appeal set out in section 7 are supplemented by the arguments set out in section 8 of the appellants' notices and by a substantial statement of case filed by the applicants. Section 8 of each appellant's notice states:

"It is the duty of the court to foster the overriding requirement of a fair trial under Article 6 and Article 6(1) and to conduct a proper examination of the submissions, arguments to follow and evidence requested on application and to be adduced by the parties, without prejudice or impartiality to its assessment of whether they are relevant to its decision within utmost good faith."

17. It is on that foundation that the applicants seek to persuade the court that this is a proper case for a second appeal. I can find nothing in the material which suggests that the bankruptcy proceedings have not met the requirements of Article 6 of the Convention. The bankruptcy orders were made on the basis of a judgment debt which itself had been the subject of applications to this court. Following the service of statutory demands - which also had been the subject of applications to this court - the district judge faced with the bankruptcy petitions could not go behind the judgment debt. There was no other basis upon which he could refuse to make the bankruptcy orders sought. Hart J was in the same position, as he correctly identified. In my view, the suggestion that the Convention right conferred by Article 6 has been infringed in the bankruptcy proceedings is wholly misconceived. There is no important point of principle or practice in issue in these bankruptcy proceedings and no other compelling reason why an appeal against the bankruptcy orders should be entertained by this court.
18. Accordingly I refuse the applications in 2002/0050 and 2002/0580. I also refuse the ancillary applications under reference 0050/A, 0050/B, 0580/A, 0580/B and 0580/C. There is no more basis for those applications than there is for the applications for permission to appeal.
19. I turn to the application under reference 2002/0432 for permission to appeal against an order made by Jacob J on 29 January 2002 in proceedings (HC0005104) brought by Mr and Mrs Tassell against National Westminster Bank in the Chancery Division of the High Court. That application is accompanied by an application for directions for referral to the European Court of Justice under 0432/A.
20. The matter before Jacob J was an application by the bank to strike out the claim of Mr and Mrs Tassell and a company of which they were, or had been, shareholders and directors. That claim faced the difficulty, identified by Jacob J, that, in so far as the personal claims brought in that action by Mr and Mrs Tassell would otherwise be sustainable, those claims had vested in that trustee in bankruptcy - or in the official receiver as interim trustee - on the making of the bankruptcy orders. The claims, if they were to be made, would have to be made by the Official Receiver as trustee and could not be made by Mr and Mrs Tassell. As the judge said, all of the claims - save for that in paragraph (e) which might be read as a claim in defamation - were properly vested in the trustee in bankruptcy and not Mr and Mrs Tassell. The second difficulty was that, in so far as the claim was brought in the name of a company, Stamford Associates, it was pursued without authority. Mr and Mrs Tassell being bankrupt were in no position to give instructions on behalf of that company because section 11 of the Company Directors Disqualification Act 1986 provided that it was unlawful for a person who was an undischarged bankrupt to act as a director, or take part in the management, of a company.
21. The judge went on to point out that, notwithstanding those objections under the Insolvency Act, the proceedings were in any event an abuse of the process in circumstances that they were seeking to relitigate the matters which had already been litigated in earlier proceedings. The judge said:

"The fact is that the whole of the claims are completely misconceived and should be struck out."

22. It was in those circumstances that, as a supervising Lord Justice in Chancery matters, I directed that the application for permission to appeal in 2002/0432 should be listed for hearing immediately after the applications for permission to appeal in 2002/0580 and 2002/0500. If the application for permission to appeal against the bankruptcy orders were refused (as they have been) then it would follow that Mr and Mrs Tassell were the subject of bankruptcy orders which could not be challenged; and the objections identified by Jacob J to proceedings brought by them - or by a company under their direction - were not capable of being overcome without the trustee's cooperation. Their application for permission to appeal would fail because they have no locus to make such an application. If there were to be an application, it would have to be made by the Official Receiver as trustee.
23. Notice was given to the Official Receiver to show cause why the applications should not be struck out. The court received a letter from the Official Receiver indicating that he had no representations which he wished to make on that point.
24. If, on the other hand, the applications for permission to appeal the bankruptcy orders had been successful, then, pending the substantive appeal against those orders, there would be a need to stay further proceedings on the application for permission to appeal in 2002/0432 until the question whether or not Mr and Mrs Tassell were bankrupts had been finally determined.
25. In the circumstances that the applications for permission to appeal from the bankruptcy orders have been refused, the application for permission to appeal in 2002/0432 must be struck out. The only person with locus to make that application does not wish to do so; and those who do wish to do so have no standing in the matter.
26. Accordingly, application 2002/0432 is struck out and the related application for a referral to the European Court of Justice is also struck out.
27. In the circumstances that Mr and Mrs Tassell are not here - and in order that a record of the reasons for the order which I have made should be available to the court and to them - I direct that a transcript of my judgment be provided to them at public expense.
Order: Applications refused. Transcript of judgment to be provided at public expense.