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 SHOREDITCH COUNTY COURT
(Mr Recorder Hamlin)

		Royal Courts of Justice Strand London WC2 Monday, 28th January 2002

Monday, 28th January 2002

1. LORD JUSTICE WARD: This is an application for permission to appeal the order of Mr Recorder Hamlin of 17th October last year when he dismissed an appeal against the order made by District Judge Van Emden on 12th October 2000. The District Judge was trying an action for the sum of £2,900 brought by the aunt of the applicant. He found for the claimant, and so entered judgment in her favour for that sum together with an order for £800 costs. The District Judge had to deal with the small claim brought by the litigant claimant, who is in person. She is now approaching the age of 97 years: she will be 97 in March 2002. She was 94 at the time. She was a little infirm.
2. The short story can be stated in this way. Mr Goldstein lent £3,500 to a Mr Hanbury, who is the claimant's son. Mr Hanbury has not repaid that money or any penny of it. As a result, the defendant took proceedings against him resulting in his bankruptcy. The awkwardness of this became really apparent when Mr Goldstein was arranging his daughter's wedding. He felt obliged, possibly out of affection I am prepared to accept, to invite his aunt, the claimant, but she was unwell and was unable attend. There was a telephone call, in the course of which it appeared that Mr Goldstein, not surprisingly, did not have Mr Hanbury on the invitation list. This led to a meeting between claimant and defendant in the course of which it was revealed to the aunt that her son had borrowed money and had not repaid it. The District Judge found as a fact that Mr Goldstein did not reveal that he had made her son bankrupt and that, if she had known that, she would not have handed over her Post Office savings book, as she did, for him to draw the money in it to pay off, whether in part or in whole it does not matter, that debt. The District Judge found in her favour.
3. There was an appeal to the Recorder. Quite why the matter had not remained for small claims arbitration I do not know. If it had, that would have been the end of the matter. But having been put into one of the tracks that now prevail, there was a right of appeal to the Recorder and, having heard the appeal, he became concerned about whether or not this was not a case which should be disposed of not as a misrepresentation but as an application of the developing strand of law dealing with unconscionable bargains. He called the parties back for further argument, and there was an argument addressed to him on that basis. He accepted that the doctrine looked, first, to whether there was oppression; second, whether the complainant was suffering from a bargaining weakness generally; and, third, whether the transaction was unconscionable. He made a finding that all three of those qualifying conditions were satisfied. He addressed then a point that was taken by Mr McIlroy, as it is taken before us today, that the doctrine does not apply to a case where there is a gift: see the decision of Mr Charles QC, as he then was, sitting as a Deputy Judge in the Chancery Division in Langton v Langton [1995] 2 FLR 891. The judge was able to distinguish that on the basis that the law has rapidly developed, even from the time that Mr Charles QC had to deal with the matter, and that it would be astonishing. To quote the learned Recorder on page 64 of our bundle, paragraph 27:

"I would go further and say that it would be a profoundly unsatisfactory state of affairs were the courts to say that this important jurisdiction was capable of granting relief to those who expected some return from their unhappy bargain but not to those perhaps even more unworldly parties who were to receive none."

4. He went on to say that the case could in any event be used in contractual terms in that the claimant was discharging her son's debt in whole or in part and that some consideration moved for the payment of the £2,900.
5. When the application was made for permission to appeal that order, the defendant, Mr Goldstein, submitted that the doctrine relating to unconscionable bargains did not extend to the setting aside of a gift and that was a point of principle where the Recorder had erred. He submitted, alternatively, that the doctrine was not exercisable on the facts found by the Recorder. The application was dismissed on paper, and my Lord, Longmore LJ, took the further point that, even if that position were correct, the factual position was that Mrs Hamburg did not realise her son had been bankrupt and would not have paid anything to Mr Goldstein if she had. A payment was thus made by reason of her mistake and is recoverable on ordinary restitution principles. That is effectively what the District Judge held. There is no important point of principle or fact to justify a second appeal.
6. Mr Goldstein renews his application and is today represented by Mr McIlroy, who appeared for him below. Speaking for myself, I am indebted to Mr McIlroy for his written arguments and his oral presentation to us today.
7. The first question in dealing with this application is whether or not it gives rise to an important point of principle or practice or whether there is some other compelling reason why this matter should be brought to the full Court of Appeal. As originally formulated, Mr McIlroy sees the difficulties in saying that an application of a principle wrongly applied on the facts gives no or little weight to the Court of Appeal. The principle which he submits is important is whether the doctrine relating to unconscionable bargains extends to the payment of a gift. The principle, in answer to my Lord's alternative way of viewing this case, is whether or not a mistake which is said to be fundamental has to be objectively fundamental or subjectively fundamental, and he points to the authorities. But that may not provide a clear answer.
8. Accepting for the moment that both attacks on matters of principle may be open, the question is whether they are important in the context of this case. The law relating to appeals has shifted since the Civil Procedure Rules have been brought into effect. This court looks, as every court does, to the overriding objective, and one has to have some regard to the proportionality of the application. In this case £2,900 is at stake. I am not saying that it is not a vast sum of money for the parties -- it certainly appears to be for the claimant, and I dare say it is important also to the applicant -- but, in the context of things, it is a small sum of money. The court's time is, unfortunately, increasingly precious, and the court has to exercise its control over what cases come here by reference not only to the importance of the legal principle at stake but to the importance of that principle being litigated, as in this case it could be, at considerable length, taking up a great deal of time which might be better deployed on other cases.
9. I am afraid I simply cannot see that this point is worthy of the attention of the court. It does not appear to me to be so strong in either case. So far as unconscionable behaviour is concerned, the argument in favour of Langton has not been shown to my satisfaction to be so overwhelming as to justify our looking at it, and, for the reasons given by my Lord when refusing permission on paper, there seem to be formidable difficulties also in the way of establishing that this case cannot be viewed as one of ordinary restitutionary principles of mistake applying to it.
10. I for my part would not be prepared to find that it is a case giving rise to an important point of principle. For that reason alone, I would find that the matter does not get over the hurdle. I would, therefore, refuse the application on that ground.
11. LORD JUSTICE LONGMORE: I agree. There is nothing I can usefully add.
Order: Application dismissed.