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 LEEDS COUNTY COURT
(His Honour Judge Cockroft)

		Royal Courts of Justice Strand London WC2 Monday, 18th February 2002

Monday, 18th February 2002

1. LORD JUSTICE SEDLEY: Judgment was given below in this case on 11th September 2001. The Appellant's Notice is dated 11th October. The reason which Mr Robinson gives is that Leeds County Court managed to lose the papers but to bank his cheque. That seems to me to be quite sufficient to excuse his delay and to make it unjust to refuse to enlarge time. So I readily extend his time for making this application.
2. The initial problem against which Mr Robinson seeks redress is the striking out of his claim against Redman Nichols, who are insolvency practitioners, at a point of time when Mr Robinson was ill and unable to attend court. With permission, he appealed to Judge Cockroft. Judge Cockroft decided all the issues afresh. It is now Mr Robinson's complaint that the judge did so upon witness statements which were contentious and ought to have been the subject of full examination and cross-examination.
3. Originally Mr Robinson sought and got permission to appeal to the Queen's Bench Division from Ouseley J. It is now accepted that the appeal lies, if anywhere, to this court. But Mr Robinson, perfectly reasonably, relies on Ouseley J's decision in favour of the grant of permission to appeal as good grounds for saying that I, likewise, should give permission to appeal.
4. I must therefore go into a little more detail.
5. Mr Robinson sued the defendant insolvency practitioner for conversion of a cheque and for negligence in two respects in acting as the liquidator of one of Mr Robinson's companies called S Rudd & Son Ltd. The 25th January 2001 was fixed as the hearing date before the District Judge of Mr Robinson's application for summary judgment. Mr Robinson was, as I am fully prepared to accept, unwell and unable to attend, but he had written in advance to say that he was not pursuing the application for summary judgment. The defendants, however, turned up by counsel and made an application to strike out the claim. It is true that the court did not appear to be aware that Mr Robinson was unable, through illness, to attend. What it had understood, and this is clear from the transcript, is that Mr Robinson had simply said that he would not be attending. His non-attendance, however, is explicable in that, even if he had been well, he appears not to have realised or had any means of knowing that the other side were going to apply to strike out his claim in its entirety. That, however, is what they did. The defendant's counsel took the District Judge through the whole claim and satisfied him that it was unsustainable on all three heads. He also suggested that the purpose of the claim was to bring collateral pressure on the liquidator to deal more favourably with another company with which Mr Robinson was also concerned.
6. On Mr Robinson's appeal to the District Judge, the judge accepted that he had a bona fide reason for non-attendance, and so he heard the entire strike-out application afresh. In other words, he did not limit himself to the question whether the District Judge had erred in law or had misconducted the proceedings; he started again at square one. I do not think that Mr Robinson could possibly have asked for more by way of appeal.
7. Contrary to what Mr Robinson submits in his written arguments, it seems to me that the judge was very careful not to purport to resolve disputed issues of fact. Let me quote some of the passages in which it seems to me he was directing himself around, rather than to, those issues. On page 26 of the bundle, lines 1-4, he says:

"... it may be that is a substantial understatement because there is a potential further debt of £140,000-odd. I do not determine this appeal on the basis that that is established because it has not been established, I have not heard evidence, this is not the trial."

8. On page 28 at lines 19-20, he says:

"It seems to me here that it is essential to start by determining what the state of the company was. If this could only be resolved by the hearing of evidence, then there would be a justification for allowing this matter to proceed..."

9. At page 30, lines 22-4, he says:

"Well, that may be the case, it is not necessary for me to decide how long the delay was or precisely what were the reasons for it. But, again, on the face of it and without requiring the hearing of any evidence, it seems to me to be plain that negligence on the part of the liquidator cannot be spelled out of these pleaded facts."

10. It was upon the basis of a fully reasoned judgment, which, as I have shown, omitted or steered round disputable questions of fact, that the judge came to the same conclusion as the District Judge, namely that the claim should be struck out in all three of its limbs.
11. I have read his judgment with care in the context of the pleadings and the papers. I have borne in mind, as Mr Robinson has asked me to do, that, as a layman, he cannot be expected to plead with the precision of a lawyer and that there might well be infelicitously expressed but nevertheless viable heads of claim. I have, however, to look not only at that question, but, the present application being for a second appeal, to look also to see if there is some important point of principle or practice involved and not merely a viable argument.
12. Ouseley J, who thought there was a viable argument, based himself upon a sight of the papers which did not contain the decision of His Honour Judge Cockroft to which I have been referring. Ouseley J was careful to point this out. Even so, and in the absence of Judge Cockroft's reasons, he too considered, like the District Judge, that the first head, namely the conversion of a cheque, was untenable. I absolutely agree with him. As to negligent advice, what Ouseley J said at page 19D was this:

"It may be that Mr. Robinson does not in fact have much of a case in relation to that, but I am not clear that it was fair for it to have been struck out."

13. He also said at page 20B:

"I would say of course that it may be these issues have all been dealt with very thoroughly and correctly by Judge Cockroft. I do not have the advantage of his judgment; I ought to have."

14. Unlike Ouseley J, I have now seen Judge Cockroft's full reasons, and for my part I can see no further room for doubt that the claim cannot succeed on the two heads of negligence.
15. On wilful neglect, which is the further head of negligence, Ouseley J felt that, with some reconstruction, Mr Robinson's claim might be able to display a cause of action for breach of some duty of care owed by the liquidator to Mr Robinson personally. Here, too, Judge Cockroft, now that I have his judgment, shows very clearly why this likewise is bound to fail. At page 31, he said:

"I cannot presently envisage the way in which this could be made a valid claim and neither the Court nor the defendants, who are in the claimant's sight lines, should be left in the position of speculating upon what might have been pleaded in the Particulars of Claim which is manifestly defective."

16. My own reason in relation to both negligent advice and wilful neglect can be very simply stated. It is that a liquidator does not owe an individual such as Mr Robinson, who happens to be the principal director and shareholder of the company, personal duties of care. He may assume them in particular circumstances, but the assumption of such a duty requires circumstantial proof of a very special kind, and here none was asserted. Therefore, even ignoring the fact that there were contentious issues spoken to in the witness statements, the simple situation (as can now be seen) confronting Judge Cockroft was that there was not pleaded, either directly or by reference, any situation of fact which, taking it to be proved, could in law found an action in conversion, or an action for negligent advice, or an action for wilful neglect. In those circumstances, I have to say that I do not think I would be in a position to give permission to appeal even if this were a first appeal, because I would not think that there would have been any reasonable prospect of success. When, however, I add to it the statutory requirement that must raise an important issue of principle or practice, then Mr Robinson will, I think, see that there is no way in which I could grant permission to appeal.
17. While I am grateful to Mr Robinson for the moderation with which he has presented this case, I think I am probably doing him a favour by not letting him get into a situation in which he would have the other side here, with highly paid solicitors and counsel, expecting their costs (which could very easily reach a five figure sum) in an unsuccessful appeal. This is the point at which the case needs to stop, and it may be to Robinson's benefit that it does so.
Order: Application dismissed.