England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE CHANCERY DIVISION
(Rimer J)

		Royal Courts of Justice Strand London WC2 23rd August 2002

23rd August 2002
1. LORD JUSTICE ALDOUS: I have to give judgment in three applications for permission to appeal. The grounds put forward for permission to appeal are interrelated and therefore I will give one judgment but endeavour to deal with the issues on each separately.
2. On 21st May 2002 Rimer J dismissed two applications by Mr Perotti dated 15th May. The first application, which is in tab 7 of the bundle, sought an order that Mr Perotti should be allowed to use his assets to pay for legal advice and representation in an application by Mr Watson, who is the claimant, for his committal. The second, which is in tab 8, sought an order that the hearing for committal should be reserved to be heard by Rimer J. I will deal with those applications in that order.
3. It is not necessary for the purposes of these applications to deal with the full history of what the judge called "eternal litigation". It is sufficient to summarise the main events. These applications arise out of litigation by Mr Perotti against Mr Watson, who is a retired solicitor, who was appointed attorney administrator of the estate of the late uncle of Mr Perotti. In an action started in 1992 Mr Perotti made a variety of claims against Mr Watson for maladministration. There were endless interim applications and appeals.
4. The trial of the action took place before Rimer J in 1997. It lasted about four weeks. Although the judge held that Mr Perotti had grounds for complaint, he was substantially unsuccessful with the result that an order for costs was made against him. Mr Perotti appealed. Between the date of the judgment of the judge and the appeal Rimer J made a worldwide freezing order, dated 18th June 1999, which prevented dissipation by Mr Perotti of his assets with a view to defeating the enforcement of the costs orders that had been made. It contained the usual provisions for such things as living expenses and also a provision which enabled Mr Perotti to use his assets for the purposes of legal advice and representation.
5. On 19th May 2000 I, together with Clarke LJ, heard an application for permission to appeal, with appeal to follow if permission was granted, against a decision and order of Laddie J of 1st February 2000. By that decision and order the judge had dismissed Mr Perotti's application that he should have recourse to the estate funds held by Mr Watson for the purpose of paying for his legal representation. However, the judge concluded that the proceeds of the sale of a property known as 64 Ivor Court should not be released for the purposes of his legal representation. In effect the application before us was an application by Mr Perotti to obtain use of funds for legal representation at the hearing in the Court of Appeal which was due to take place on 11th July.
6. Upon that application we came to the conclusion that there was no restriction upon Mr Perotti either selling the property or to charging it for the purposes of raising money for taking legal advice and representation. However, that was not the view that was taken by the solicitors for Mr Watson, despite the fact that it was conceded at the hearing by counsel that our view of the position was correct. In those circumstances we made a declaration to that effect.
7. By the time the matter came before us on 19th May it was clear that the orders for costs again Mr Perotti exceeded £400,000. It was, therefore, not surprising that those advising Mr Watson had taken steps to protect Mr Watson's position. He had applied for a charging order on the property. That came initially before the court ex parte. On 15th March 2000 Master Moncaster made a charging order over the property. The effect of that charging order was to prevent Mr Perotti from either selling the property or using it to raise money for the purposes of his legal representation. It followed that the charging order was acting as a bar to Mr Perotti obtaining legal advice and representation upon the forthcoming appeal and it also prevented implementation of that part of Rimer J's freezing order which allowed Mr Perotti to raise and spend money for the purpose of legal representation.
8. By preventing Mr Perotti obtaining legal representation Mr Watson gained an advantage on the forthcoming appeal against the order of Rimer J, which formed the basis for most of the costs that had been ordered. It also made it more likely that Mr Watson would succeed on the appeal because Mr Perotti would not be legally represented with the consequent result that the costs orders were more likely to be upheld. It was in those circumstances that the charge was varied by this court so as to enable Mr Perotti to raise up to £80,000-odd for the purpose of obtaining legal advice and representation.
9. By September 2000 it was apparent that the cost of advising Mr Perotti and instructing counsel to represent him at the hearing of the forthcoming appeal would exceed the sum of the limit imposed in the order of this court. Mr Perotti, with the aid of solicitors and counsel, applied to Rimer J to be permitted to raise a further £90,000 on security of the lease of 64 Ivor Court. On 27th October 2000 Rimer J permitted a further £60,000 to be raised in priority to Mr Watson's charging order. He said in his judgment that he had considerable reservations as to whether it was appropriate to make the further order.
10. The appeal was to be heard on 13th November. It was contemplated that the money would be raised in the next few days. However, Mr Perotti was not able to provide his solicitors with sufficient funds with the result that he appeared in person before the Court of Appeal. The appeal was dismissed with costs. An application for permission to appeal to the House of Lord was also dismissed. It followed that the litigation, as to the way that Mr Watson had administered the estate, had been concluded. Mr Watson was left with costs orders which exceeded £600,000.
11. The order of Rimer J, permitting the further £60,000 to be raised, was never drawn up. On 19th February 2001 solicitors on behalf of Mr Watson issued an application for an order that his judgment given on 27th October, be recalled and the application of Mr Perotti to raise a further sum be dismissed. That application came before Rimer J on 5th March 2001. The judge concluded that he had jurisdiction to recall the order and that it was right to do so.
12. Against that decision Mr Perotti sought permission to appeal to this court. His application was refused. In my judgment of 4th April 2001 I concluded that it was entirely appropriate for the judge to make the order that he did. I restated that the order that had been made by this court on 19th May 2000 was to enable funds to be raised so as to provide legal representation in the forthcoming appeal.
13. I come next to the committal proceedings. These were started by application dated 29th April 2002. In the notice the claimant sought committal of Mr Perotti to prison. It was alleged that he had failed to comply with paragraph 8 of an order of Master Moncaster of 25th September. That required him to deliver to the claimant's solicitors within ten days after service of the order two copies of every lease, agreement or licence pursuant to which 64 Ivor Court was let, a statement in writing of the service charges and other outgoings of the property, and a statement in writing of all sums due, or to become due, from any tenant or occupier at the premises. I was told that the original order did not have a penal notice on it, but it made provision for service.
14. Mr Perotti failed to appear on the return date. He was arrested and brought before Laddie J on 14th May 2002. The judge directed an adjournment until 29th May 2002 to enable Mr Perotti to obtain legal advice and representation and to file evidence, if so advised, by 4.00 p.m. on 27th May 2002.
15. Mr Perotti now seeks, as I have said, an adjournment of the committal proceedings to enable him to raise money to fund his legal representation and for an order that the matter be transferred from Laddie J to Rimer J.
16. Rimer J considered Mr Perotti's application to have his assets released to pay for legal representation to resist the application for committal. He concluded that the present situation was different to that which existed when the assets were released prior to the appeal to this court. He said:

"The costs orders are not beyond challenge and the Master has also made an order which is now similarly beyond challenge for the sale of the flats for the purpose of realising the security conferred by the various charging orders. For the court at this stage to vary those orders in the way Mr Perotti invites would amount to nothing other than an imposition on Mr Watson and the estate of the further legal costs which Mr Perotti has now declared he is determined to incur. As a matter of discretion I would refuse to make any such order which would regard as profoundly unjust to Mr Watson. Accordingly I decline to permit Mr Perotti to have recourse either to the £20,000 or to either of the flats."

17. I have no doubt that the judge exercised his discretion appropriately.
18. The position today is very different to that which prevailed at the time when this court varied the charging order. At that time the charging orders were acting as an obstruction to Mr Perotti putting forward his attack on the judgment upon which costs orders were based and as such it was injustice that he could not implement that part of the freezing order which permitted him to use his assets for the purposes of legal representation. That was very different to the position when the judge decided the application. The litigation had been concluded. Mr Perotti owes Mr Watson over £600,000 and justice does not require him to be in a position to use his assets to pay for legal representation instead of paying the debts that he owes Mr Watson.
19. I conclude, therefore, that it would be inappropriate to accede to Mr Perotti's request for permission to appeal the judge's refusal to release further assets for his legal representation in the committal proceedings. The judge who hears those proceedings will need to decide whether Mr Perotti needs to be represented and, if so, how.
20. Mr Perotti drew to my attention in this respect Article 6 of the Humans Rights Convention. He referred me to the case of P, C and S v United Kingdom, application number 56547/00, reported August 2002. He submitted that he was now in a catch 22 situation. He says that when he appears before the judge and an adjournment is given to enable him to get legal representation it is normally a short adjournment, but they know that he cannot get a solicitor to apply for legal assistance and in those circumstances he is not in a position to obtain legal representation. He says that it is particularly important that he should have legal representation in a case where he is liable to go to prison.
21. In a case when somebody is liable to go to prison, it is helpful if that person is legally represented, and there is a considerable body of law, both from Strasbourg and in this country, to that effect. The judge who hears the committal will need to consider that body of law before the case starts. If Mr Perotti is right, that no solicitor will take his case, it may be that the judge will think of calling upon the Official Solicitor to give him help in this matter. However, that is not a ground for giving permission to appeal in this case. The money is owed to Mr Watson. If Mr Perotti has to have legal representation, then the state must provide it if he cannot pay for it.
22. I must next refer to the other grounds put forward by Mr Perotti for permission to appeal. He refers to the fact that the judge continued to hear the application in his absence, because he left the court upon being told that he was going to be evicted from his home later in the week, which was on the Friday. He submitted that matters should have been dealt with by granting at least two weeks of a stay of eviction in order that he might have time to deal with the application. In any case, he submitted that he should not have been required to deal with the matter in the way that he was and the judge should not have considered the case in his absence.
23. There can no basis for giving permission to appeal on those grounds. The CPR expressly provides for hearings to continue in the absence of a party. In any case, the reason for Mr Perotti leaving the court was not, in my view, sufficient to require that the hearing should be aborted, particularly when the eviction was not due to take place until the Friday.
24. I come next to the application to have the committal proceedings transferred from Laddie J to Rimer J. The purpose of the order to have the committal proceedings transferred to Rimer J was to avoid them being heard by Laddie J. Mr Perotti had written to Laddie J making quite clear his views as to why the judge should not hear any application in which he, Mr Perotti, was involved. In particular, he objected to the way that Laddie J dealt with the committal proceedings when he was sent to prison. He believes that it would not be right for these committal proceedings to be heard by him. They should be heard by another judge, in particular, Rimer J who is fully appraised of all the issues. Rimer J rejected that application.
25. I have read through the letter written by Mr Perotti. There is no valid objection raised to Laddie J, or any other judge, hearing the committal application. It is not for Mr Perotti to seek to pick the judge who should hear the application. It is for the court to decide which judge should hear the committal proceedings. It cannot be properly said that Laddie J will not give Mr Perotti a fair trial. In those circumstances, an appeal would not stand a real prospect of success on this issue.
26. I come next to the application which is proceeding in the Court of Appeal under A3/2002/1186. This is an application for permission to appeal the order of Rimer J of 21st May 2002 in which he considered an application of 22nd November 2001 by Mr Watson. That application, which is at tab 4 of my bundle, sought an order that Mr Watson should have permission to enforce an order, dated 10th September 1999, of Laddie J against assets of Mr Perotti in Switzerland and have permission to commence civil proceedings in Switzerland for the purpose of preventing Mr Perotti from moving assets and for the purpose of obtaining enforcement in Switzerland of the charge or other security against such assets. The order also sought that Mr Perotti should swear and file an affidavit and serve it upon Mr Watson deposing as to his assets, whether in or outside England and Wales, which he holds, or claims to hold, as trustee or nominee. The basis of the application was that the applicants believed that Mr Perotti holds money, or assets, overseas, in particular, Switzerland.
27. The order made by the judge recited the undertaking that Mr Watson and his co-defendants gave not to bring proceedings against Mr Perotti in any other jurisdiction, or to use information obtained as a result of the freezing order, without leave of the court. It went on to recite that the applicants had commenced proceedings in Switzerland to ascertain whether the claimant had a bank account in Switzerland and to enforce orders for payment made in this country.
28. The order recorded that the breach of the undertaking which had occurred had been disclosed to the court and the court was of the opinion that the contempt had been sufficiently purged. It went on to order that the application by Mr Perotti for an adjournment was rejected, as was the application by him for recourse to his assets for the purpose of paying for legal advice and representation. It also ordered Mr Perotti to swear and file a further affidavit within 20 days after service of the order deposing as to his assets.
29. Mr Perotti raises the same points which I have already dealt with. He also alleges that it was wrong for the judge not to allow him transcripts of the proceedings at public expense. I have already given, in a separate judgment this morning, my reasons for why such an order would not have been appropriate. The judge ordered a copy of the transcript of his judgment at public expense. I believe there is no reason why Mr Perotti should be entitled to have the transcript of the proceedings transcribed and paid for by the tax payer despite the fact that he left the court before 11 o'clock and consequently did not hear most of the proceedings, or the judgment, or the discussion after the judgment. In my view, this is a case in which he should be given permission to listen to the tape and if he wishes to have it transcribed he must do so at his own expense. An appeal on that ruling would not stand a real prospect of success.
30. In my view, the crucial issue dealt with by the judge was his order requiring Mr Perotti to make a further affidavit as to his assets. The information that was before the judge suggested that Mr Perotti had not given a comprehensive affidavit of assets when required to do so under the original freezing order. The judge concluded that in those circumstances it was right that Mr Perotti should be required to make an up-to-date affidavit of his assets, accounting for any assets in Switzerland.
31. The matter that concerned the judge was whether an unconditional order, requiring Mr Perotti to provide such an affidavit, might require him to produce an affidavit which would involve the risk of self-incrimination. The judge went on to consider the authorities upon that issue. It was in those circumstances that the judge made an unconditional order, but gave Mr Perotti a generous timetable within which to provide the affidavit. He included a term that Mr Perotti was at liberty to apply to set it aside on the grounds that it ought not to have been made on the basis that compliance with it might incriminate him. The order also provided that if such an application was made then the time for compliance with the order would be extended until the application was disposed of.
32. Mr Perotti submitted that the order was wrong as it already had been decided in the judgment of 24th June 1999. Thus, he says, it was res judicata. Not so. That was a judgment continuing the freezing order and this was a judgment which supplemented it.
33. Mr Perotti also submitted that the judge should not have made the order excusing Mr Watson for the contempt and allowing proceedings to be continued in Switzerland. Mr Perotti says that those acting on behalf of Mr Watson lied in the Swiss court and have not proceeded in the way that lawyers should act. That being so, he submits that their contempt should not have been excused and they should be denied the ability to proceed in Switzerland. He says that the judge treated Mr Watson in this respect completely different to the way that he has been treated in other contempt proceedings.
34. The judge had before him sufficient facts and he was entitled to come to the conclusion that Mr Watson had purged his contempt. It was within his discretion to come to that conclusion. In those circumstances, the decision of the judge to allow Mr Watson to proceed in Switzerland was within the ambit of that discretion and no possible appeal could succeed upon it. In any case, the judge did not in any way come to a conclusion as to whether Mr Perotti has assets in Switzerland, nor whether he was in breach of the orders that had been made. That remains to be tried.
35. For those reasons, I have come to the conclusion that there is no real prospect of Mr Perotti setting aside the orders of the judge on appeal. In my view, there was ample evidence on which the judge could have concluded that Mr Perotti's first affidavit as to means was not complete. In those circumstances, it was within the ambit of his discretion to make an order for a further affidavit.
36. I come last to the application bearing the appeal number A3/2002/1118. That is an application filed on 27th May 2002. It seeks permission to appeal against the order of Laddie J of 14th May 2002. That order dealt with an application by Mr Watson dated 29th April 2002 seeking committal of Mr Perotti. The order adjourned the application to Wednesday 29th May to come on in the Interim Applications Court and required Mr Perotti to serve his evidence by 4.00 p.m. on 27th May 2002. This was in effect an application that Laddie J ought not to hear any further applications in any case in which Mr Perotti was a party, whether as claimant or defendant.
37. I have already referred to the letter to the judge stating his reasons why Mr Perotti should never again appear in that judge's court. It is included in the bundle before me at tab 1. In essence it alleges that the judge was:

"Unquestionably biased against him and in favour of Mr Watson and his lawyers."

38. It asserts that the judge would wilfully, deliberately intentionally and knowingly fail to respect Mr Perotti's human rights and, in particular, has failed to provide him with legal assistance. Further, when considering the previous application for committal, he had failed to apply the correct onus of proof and was determined to find him guilty even though no independent jury in the criminal courts would have done so. Mr Perotti drew to my attention his allegation that he could not have been convicted of contempt upon his mother's evidence which was not challenged. The letter goes on to refer to the judgment that he gave, which was considered by myself and Clarke LJ on 19th May.
39. I have no doubt that the judge was right to make the order he did. There is no real prospect of success if permission to appeal was granted. There is nothing before this court except the assertions of Mr Perotti which would suggest that Laddie J could not or would not consider the committal applications fairly and properly. In my view, it is for the court itself to decide which judge should hear the matter. It is not for Mr Perotti to pick and choose.
40. I have already referred to the effect that the charging orders and other orders have had and how they have prevented Mr Perotti from using his assets to obtain representation in committal hearings for which he is liable to go to prison. I have already drawn attention to the Convention and the desirability of a person who is liable to go to prison of being legally represented. I have no doubt that the judge who hears the committal proceedings will take those observations into account.
41. In my view, this application for permission should not succeed as there is no real prospect of it succeeding. It is therefore refused.
ORDER: Applications refused. No order as to costs.