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 STOKE ON TRENT COUNTY COURT
(MR RECORDER DAVID TUCKER)

		Royal Courts of Justice Strand London WC2A 2LL Monday 29 April 2002

1. LORD JUSTICE MUMMERY: This is an application by Mr Kakembo for permission to appeal and for an extension of time. The decision which he wishes to appeal is that of Mr Recorder Tucker in the Stoke-on-Trent County Court on 11 April 2001. Mr Kakembo requires an extension of time because, having been refused permission to appeal by the recorder, he did not file the appeal notice in the Civil Appeals office until 22 November 2001, over 6 months later.
2. For a number of years Mr Kakembo was a successful business man having a franchise for Suzuki car sales, which he lost in 1990. He then sought other ways of earning a living. On 26 November 1990 he signed a financial consultancy agency agreement with the Legal & General Assurance Society Limited, having been on a training course provided by them for prospective agents. By that agreement, he was appointed as an agent, not an employee, for selling policies of life assurance, annuities and pension contracts. He went on an orientation course between 27 and 30 November 1990 and signed his name to a Business Plan D which provided, among other things, for the payment of advances to him.
3. At the time Mr Kakembo's line manager was Mr Farook Hameed. According to Mr Kakembo, Mr Hameed left over some dispute. He was replaced by the Birmingham branch manager, Mr Keith Fenton. Both those gentlemen gave evidence at the hearing, but Mr Kakembo criticises their evidence, which the recorder accepted was flawed in a number of respects.
4. Unfortunately things did not work out between Mr Kakembo and Legal & General. The agency agreement was not formally terminated until 20 February 1992, but the recorder found that it had effectively ended in early 1991 when the Legal & General stopped paying advances to Mr Kakembo.
5. Legal & General commenced proceedings on 5 March 1993. Their claim against Mr Kakembo was for repayment of advances they had made to him totalling £2,433.08. Mr Kakembo served a defence and counterclaim on 8 April 1993. He claimed a sum of £21,543.74 in respect of commission which he had been prevented from earning as an agent by the actions of Legal & General, which he says were not justified. The claim by Legal and General against Mr Kakembo was struck out on 6 August 1994. However, the counterclaim did proceed and on 9 July 1996 Legal & General served an amended defence to counterclaim, in which they pleaded, among other things, a set-off of the sum of £2,433.08 which had formed the original subject matter of their claim.
6. The trial of the counterclaim took place on 15/16 March 2001. In a reserved judgment the recorder dismissed the Part 20 counterclaim against Legal & General and refused to grant Mr Kakembo permission to appeal. Mr Kakembo says that after the conclusion of the judgment he asked the recorder and the barrister representing Legal & General about the time he had in which to appeal. He was told that it was 28 days, whereas it was 14 days.
7. Mr Kakembo obtained the forms for appealing from the Civil Appeals office, but was under the impression that he had to have the appeal documents processed locally. There then followed the lengthy period before the appeal notice was filed on 22 November 2001. The appeal notice sets out the grounds of appeal in section 7 which states:

"The judgment order was based on witnesses whose statements were factually and materially wrong."

8. In section 10 he applies for an extension of time in which to appeal on the ground that he was given the wrong information by the recorder.
9. The grounds of appeal are set out more fully in Mr Kakembo's skeleton argument dated 18 December 2001 and they have been very clearly and courteously explained to the court by him, appearing in person. The essence of the recorder's decision was that, although he accepted that Mr Kakembo was an honest and truthful witness, the law was on the side of Legal & General for these reasons. Mr Kakembo had signed up to the Standard Business Plan D, which formed part of the agreement between him and Legal and General. He was under an obligation to produce a minimum level of production of £1,000 per month and had to fulfil that requirement in order to be entitled to the monthly advances of £1,200 referred to in Business Plan D. The recorder found that Mr Kakembo had failed to earn commission up to the required level, the necessity for which had been explained to him. In these circumstances, the recorder held that Mr Kakembo was not entitled to further advances and the failure of Legal and General to make those advances was not a breach of their obligations to him under the agency agreement.
10. In his judgment the recorder explained that in evidence Mr Kakembo complained that Mr Hameed should have emphasised more than he did what was expected of him in terms of initial commission, and that the earning of initial commission affected the advances he could receive under the terms of Business Plan D. He referred to the evidence of Mr Hameed that, as there was no business coming from Mr Kakembo, he stopped the cheques going to him after the payment in January. He accepted the evidence of Mr Hameed that he had explained to Mr Kakembo why he had done this. The recorder said at page 18 of his judgment:

"It is understandable therefore that with no other source of income other than the advances made under the Legal & General agreement Mr Kakembo was unable to complete the transactions he was hoping to complete on behalf of Legal & General following his fact finds, because he could not afford to travel to London where many of his contracts were, and as he conceded at the time he was under a lot of pressure financially.

The reality is therefore that he was unable to perform his side of the bargain with Legal & General without financial support and they had withdrawn their financial report because he had not complied with the conditions he agreed at the outset. I am afraid this is what really lies at the heart of the unfortunate saga of Mr Kakembo's relations with Legal & General.

If, as a matter of law Legal & General were entitled to take the stance they did, it was inevitable that Mr Kakembo, unless he had some other source of income to fund his expenses until commission came in, would not be able to be a successful agent. I find that clearly on the documents and on the evidence of Mr Hameed and indeed Mr Kakembo himself, Legal & General were entitled to stand on the terms of their contract."

11. He then dealt with other areas of complaint raised by Mr Kakembo in his counterclaim as to the unfairness of Legal & General's conduct in relation to advances and complaints he had as to training, lack of cooperation and failure to act diligently.
12. The main ground of appeal is that these findings of fact by the recorder, and therefore his conclusions, are wrong because they are based on flawed evidence given to the court by Mr Hameed and Mr Fenton.
13. In his oral submissions Mr Kakembo made a number of additional points in which he says that he had not been given any letter about the changeover from Mr Hameed to Mr Fenton. He emphasised that he needed the money from the advances to do the work to earn the commission. He said that he had visited a number of people, but was told that they should not sign up on the first visit. Funds were important to enable him to complete the agreements with the people he had visited and therefore earn the commission. He had not received the benefit of the provisions for the review of his work set out in the contract.
14. Mr Kakembo made a number of other points in his written skeleton argument. He said Legal & General had aggregated the terms of the agreement when it suited them. He sets out in a number of passages his allegation that there was a conspiracy against him at branch level between Mr Hameed and Mr Fenton. Funds, which had agreed to be paid to him under the agreement, had been arbitrarily withdrawn by the branch managers without warning or notice to him and before the stipulated reserve fund limit was reached. Legal & General had failed to notice the actions of the branch managers. He emphasised that the advance payments were a fundamental terms of the agreement for at least 12 months. He repeated that the witness statements of Mr Hameed and Mr Fenton, on which the recorder had relied, were factually and materially flawed and not backed up with documentary evidence. He also mentioned in the skeleton argument and his oral submissions the importance of the requirements of the Financial Services Authority. He alleged that a number of years ago Legal & General had been fined for misconduct and complained that the recorder had refused to take this into account in the evidence at the trial.
15. I have to consider these grounds in the light of the provisions of the Civil Procedure Rules governing appeals to this court. The relevant provisions are contained in Part 52.3(6) which provides that:

"Permission to appeal will only be given where-

(a) the court considers that the appeal would have a real prospect of success; or

(b) there is some other compelling reason why the appeal should be heard."

16. In deciding whether there is a real prospect of the appeal succeeding, I must also take into account the provisions which apply on the hearing of an appeal, as contained in 52.11(3) which provides that:

"The appeal court will allow an appeal where the decision of the lower court was-

(a) wrong; or

(b) unjust because of a serious procedural or other irregularity in the proceedings in the lower court."

17. Mr Kakembo relies principally on (a), that the decision was wrong, because of the flawed evidence of Mr Hameed and Mr Fenton.
18. I have taken account of all the points made by Mr Kakembo. I have concluded that in my judgment this appeal does not have a real prospect of success. The recorder made findings of fact on the basis of evidence which was put before him and which he was entitled to accept. He appears to have expressed sympathy for Mr Kakembo's position. He decided the matter, as he was bound to, on the basis of the legal rights of Legal & General under the terms of the agency agreement and the Business Plan D. It appears to me clear on the basis of his findings of fact, and taking into account the provisions of the documentation, that Legal & General were entitled to refuse to make advances to Mr Kakembo, as he had not earned the sufficient level of required commission.
19. I fully appreciate the predicament in which Mr Kakembo found himself without other financial support and how the set up created a vicious circle in which, without the advances, he could not earn the commission and, if he did not earn commission, he was not entitled to the advances. I agree with the recorder that the Legal & General were entitled, in the circumstances, to rely on their contractual grounds in order to resist the counterclaim brought by Mr Kakembo for commission which he says he would have earned, if he had not been prevented from doing so by the withdrawal of the advances.
20. If I thought that Mr Kakembo had a real prospect of success on this appeal, I would, with some reluctance, have granted an extension of time. I appreciate the difficulties which he has as a litigant in person in dealing with the procedural requirements for bringing an appeal to this court. I would have granted an extension, even though the period of delay was considerably longer than it is normal to overlook, and even though Mr Kakembo was unable to give a satisfactory explanation for the long length of the period, far longer than is warranted by his explanation that he thought that he had 28 days rather than 14 in which to file the appeal notice.
21. For all those reasons I would dismiss this application.
Order: Permission to appeal refused.