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 KINGSTON-UPON-HULL COUNTY COURT
(MRS RECORDER STOCKEN)

		Royal Courts of Justice Strand London, WC2 Thursday, 10th October 2002

1. LORD JUSTICE LAWS: This is an application for permission to appeal against the judgment of Mrs Recorder Stocken given in the Kingston-upon-Hull County Court on 9th July 2002 when she dismissed the applicant's claim for damages for breach of contract and misrepresentation, and gave judgment for the defendants on the counterclaim for, I think, some £10,625.10, including interest.
2. The facts and background may be explained as follows: on 18th August 2000 the applicant entered into a tenancy agreement with Enterprise Inns PLC in respect of a premises known as "The Buzz Bar" in Hull. Enterprise Inns PLC were to become the defendants in the case. Before signing the lease, however, the applicant had held a meeting with a Mr Simon Gifford, a business development manager employed by Enterprise Inns, and also Mr Paul McGowan, who I think had been the previous tenant of the Buzz Bar. The applicant's wife was also present at this meeting, though only from time to time. The meeting took place on 10th August 2000 at the restaurant which the applicant then owned or managed. That was, of course, some eight days before he entered into the tenancy agreement.
3. The applicant's case in due course was that at the meeting on 10th August Mr Gifford made certain representations which turned out to be false. It is said that he told the applicant that the Buzz Bar's takings were approximately £4,500 to £5,000 a week, and also that the Buzz Bar held a public entertainment licence. The applicant's wife and Mr McGowan supported, to some extent at least, the applicant's evidence about these representations. Mr Gifford for his part denied making any statements to that effect.
4. At the following meeting on 18th August the applicant said that Mr Gifford agreed that he, the applicant, should carry out any necessary works to the premises and that Enterprise Inns would reimburse him for the cost. That piece of evidence was also, I think, supported by Mr McGowan. Mr Gifford, again, denied that anything of the kind had been said. The applicant had brought with him some £2,400. On that occasion Mr Gifford told him that that would not be enough to cover the stocktaking value, and a further £1,000 was needed. Mr Gifford said that the applicant agreed to pay the shortfall at a rate of £250 a week. The applicant for his part said he agreed to pay at £250 a month.
5. So it was that the applicant signed the tenancy agreement. He alleged, again supported by Mr McGowan, that there was no profit and loss account available. So he seems to have signed the tenancy agreement without reviewing any objective financial information. But Mr Gifford was to say that a profit and loss account had been provided. In due course the applicant instructed solicitors to obtain the relevant licences for the Buzz Bar, and it was part of his case that he expected Enterprise Inns to reimburse him for that expenditure. At length, Enterprise Inns levied distress for rent at the Buzz Bar (that was, I think, on 15th December 2000); the lease was forfeited and Enterprise Inns took possession on or around 3rd January 2001.
6. So it was that the applicant came to issue these proceedings. In the action he claimed some £21,450 plus interest as damages for breach of contract and misrepresentation. He made these claims: (1) Mr Gifford had misrepresented the takings as being in the region of £4,500 a week; (2) Mr Gifford had made a further misrepresentation, namely that the Buzz Bar had a public entertainment licence; and (3) that there had been an agreement that he, the applicant, could carry out any works that were needed, and the whole of the costs would be reimbursed by Enterprise Inns, the defendants.
7. Enterprise Inns denied the allegations of misrepresentation. But they also relied on the terms of the written tenancy agreement, particularly clauses 23.3 and 23.4. Clause 23.4 was to the effect that the agreement was not to be varied save by written agreement entered into by both parties. Clause 23.3 figured large in the Recorder's judgment, and so I should just read its terms:

"The Parties acknowledge that this agreement constitutes the entire contract between them to the exclusion of any antecedent statement or representation whether oral written or implied or contained in any advertisement in whatever form made by the Company or the Company's officers employees agents or contractors and the Tenant hereby acknowledge that he has not entered into this agreement in reliance upon any such statement or representation other than those (in any) [that must be a misprint for 'if any'] given by the Company in writing signed by a director of the Company or the Company's solicitors in writing signed by the Company's solicitors."

8. On 21st August 2001 Enterprise Inns issued a counterclaim for the sum of £10,033.83 for trade invoices and outstanding rent. The counterclaim was later amended downwards to some £9,454.
9. In her judgment of 9th July 2001 Mrs Recorder Stocken drew attention to what she saw as the unreliability and inconsistency of a number of the witnesses, including Mr Gifford, Mrs Cotton and Mr McGowan. She proceeded to address each of the three headings set out in the applicant's claim. As regards misrepresentation in respect of the weekly takings, the Recorder took the view that she could not be sure whether the misrepresentation was made, and even if it was made she was not satisfied that it was relied on. Even if reliance could be shown, she held that the misrepresentation would, as it were, be neutralised by the terms of clause 23.3; so that the applicant could not sue on it.
10. She found that it was "quite possible" -- those were her words -- that the applicant had been told there was a public entertainment licence, and she made it clear she found Mr Gifford's evidence unconvincing on that point. But she held that the applicant had not established any loss as a result of that distinct and specific misrepresentation, if it had been made.
11. As regards the third point in the claim, that is the alleged agreement to reimburse Mr Cotton for expenses, the Recorder found that the suggestion that Enterprise Inns had agreed to pay back all such costs, thus effectively writing a blank cheque, was simply implausible and incredible. The applicant had not provided any invoices as evidence of work undertaken. The Recorder was not satisfied that the expenses formed any part of a contract between the parties.
12. She considered that the terms of clause 23.3 provided a powerful defence for Enterprise Inns. She was satisfied, moreover, that it was a reasonable provision having regard to the terms of the Unfair Contract Terms Act 1997. It was plainly right that she should consider those matters. In the result the Recorder found in favour of Enterprise Inns on their counterclaim and made the orders to which I have referred, and also ordered the applicant to pay Enterprise Inns' costs subject to a detailed assessment.
13. The applicant's grounds of appeal are shortly stated:

"The Defendant [I interpolate, that is strictly a reference to Mr Gifford] lied on oath and because Enterprise Inns were trading illegally from May 2002 to August 2002, I believe that Simon Gifford's statement should be taken out of evidence as being unreliable and that the contract between myself and Enterprise Inns be null and void."

14. There is also a skeleton argument which the applicant has put in, which contains a good deal more detail. In that document the applicant states that Mr Gifford perjured himself by stating that the Buzz Bar had a public entertainment licence. He claims to have new evidence arising, he says, because there was a second trial bundle which did not arrive in time to be properly considered by the Recorder, or for that matter himself. It is not really clear whether that is right, but in any event I have considered the documents on which he seeks to rely.
15. He refers first to a balance sheet, which is at page 284 of bundle 2. That has an entry of some £70 expenditure against the word "entertainers". So it is evident that entertainment was being put on at the Buzz Bar. The applicant also says that there is some discrepancy on the dates of that document.
16. He refers also to other documents: there are two accounting documents, and there is an inventory of the furnishings, fittings and effects at the Buzz Bar premises. The applicant points to references in these documents to entertainment and entertainment equipment. I understand him to assert that these documents demonstrate that there was entertainment at the Buzz Bar, and that Mr Gifford must have known about these documents. It is not clear to me, I have to say, quite how these documents demonstrate that Mr Gifford distinctly lied in saying there was a public entertainment licence. It may be that if there was no such licence, the documents are evidence that entertainment was being illegally carried on at the club; but that was not really what the applicant was suing about. In any event the Recorder herself held, as I have already said, that it was quite possible that the applicant was told there was a public entertainment licence, but no loss was suffered by him in consequence.
17. Further, clause 23.3 would close off any reliance by the applicant on any such representation, and there is no suggestion in this application that clause 23.3 was other than a valid provision of the contract. For all those reasons I am driven to conclude that there is nothing in this application, which must be dismissed.
ORDER: Application for permission to appeal dismissed.