England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM HUDDERSFIELD COUNTY COURT
(HIS HONOUR JUDGE BARRY)

		Royal Courts of Justice Strand London WC2 Tuesday, 23rd April 2002

Tuesday, 23rd April 2002

1. LORD JUSTICE JUDGE: I will ask Lord Justice May to give the first judgment.
2. LORD JUSTICE MAY: 14 Woodhouse Avenue, Fartown, Huddersfield is the family home of the defendants, Mr and Mrs Ray. It is registered in Mr Ray's sole name. The claimants, Cedar Holdings Limited, advanced two loans secured on the property: one of £7,560 on 9th June 1989, and the second loan of £10,387 made on 21st May 1990. By 1992 repayments under the legal charge were in arrears. On 3rd September 1992 Deputy District Judge Trainer on the claimant's application made an order for possession of the property against both defendants and gave judgment. The order was suspended on terms as to instalment payments. Instalment payments were made and the suspended order remained unexecuted. However, in about 1999 when Mr Ray was out of work. Instalment payments were not made, and so the claimants applied for permission to issue a warrant. The court suspended execution of the warrant on three occasions between October 1999 and March 2001.
3. On 21st March 2001 the warrant application was adjourned to 26th June 2001. Just before that, on 21st June 2001, Mrs Ray applied for the 1992 possession order to be set aside as against her. The application was made under Rule 39.3 on the grounds that neither she nor her husband had attended the hearing at which the possession order was made. She advanced a proposed defence to the effect that, although the legal charge has what appears to be her signature, she did not sign it and the signature is a forgery. The person who, on the face of the legal charge witnessed her signature, has made a witness statement in support of this contention.
4. On 20th August 2001 District Judge Harrison made an order setting aside the 1992 possession order. A transcript of the hearing before him indicates that he gave quite short consideration to the appropriateness of making this order, but he did not consider and was not referred to the terms of Rule 39.3.
5. The claimants appealed against the district judge's order. The appeal was heard by His Honour Judge Barry, who allowed the appeal on 17th January 2002 and reinstated the 1992 possession order. He did so on the basis that Mrs Ray was unable to bring herself within Rule 39.3(5)(a). The relevant part of Rule 39.3 is as follows:

"(3) Where a party does not attend and the court gives judgment or makes an order against him, the party who failed to attend may apply for the judgment or order to be set aside.

(5) Where an application is made under paragraph (2) or (3) by a party who failed to attend the trial, the court may grant the application only if the applicant -

(a) acted promptly when he found out that the court had exercised its power to strike out or to enter judgment or make an order against him;

(b) had a good reason for not attending the trial; and

(c) has a reasonable prospect of success at the trial."

6. The judge's decision proceeded on the basis that Mrs Ray might well satisfy the second and third of these conditions but that she failed to satisfy sub-subparagraph (a) because she had failed to act promptly.
7. The facts as to delay are straightforward. The possession order was made in September 1992. The claimants contend that there is good ground for supposing that Mrs Ray herself knew about it, at least by 1993. But in any event it is accepted that she knew about it from 28th March 1995 when she opened correspondence which had been sent to the house from the claimants' solicitors with whom she had a telephone conversation on that day. Her explanation for not taking steps then to have the order set aside is that she did act promptly in 1995, because she took steps to ensure that her husband continued to pay the instalments owing under the order. It was only when he stopped doing so in 1999 and she herself learnt about this in April 2001 that she needed to apply to the court, and she then did so promptly.
8. Mr Hill submits on her behalf that the issues to be debated are first, what is meant in the circumstances of Rule 39.3 by promptly; and second, whether the requirement to act promptly means that an application to set aside must be made promptly or whether it can extend to taking other reasonable and appropriate steps to deal with the situation as it arose. It would have been counterproductive, he submits, on the ground to do anything other than see that the instalments were made, and that is what Mrs Ray did. It can be argued that she acted with reasonable speed in circumstances where what she did until 1999 was successful. Mr Hill emphasises that the judge had some sympathy with Mrs Ray's predicament.
9. Rule 39.3(5) is construed as obliging a prompt application to the court, this may engender the expense of unnecessary applications to the court in situations such as these. Mrs Ray, he submits, took the most appropriate steps between 1995 and 2001 and, when it became appropriate, she made a prompt application. There was no unreasonable delay and what she did should be regarded as having acted promptly. He submits that this point was arguable and that Mrs Ray should be enabled to advance it.
10. The judge gave permission to appeal. He should not have done so and his permission is ineffective because this is a proposed second appeal to which Rule 52.13 and section 55 of the Access to Justice Act 1999 applies. Rule 52.13 provides:

"(1) Permission is required from the Court of Appeal for any appeal to that court from a decision of a county court or the High Court which was itself made on appeal.

(2) the Court of Appeal will not give permission unless it considers that -

(a) the appeal would raise an important point of principle or practice; or

(b) there is some other compelling reason for the Court of Appeal to hear it."

11. Thus, only the Court of Appeal may give permission to appeal for a second appeal, as this would be. Subsequent to judge Barry's hearing, Pill LJ refused permission to appeal on paper.
12. In my judgment, the meaning of the introductory words to Rule 39.3(5), which include the words "the court may grant the application only if" is plain. As I said in Vinos v Marks and Spencer [2001] 3 ALL ER 784 at 789G paragraph 20 of the judgment of another provision of the CPR where the expression "only if" is used:

"The meaning of r 7.6(3) is plain. The court has power to extend the time for serving the claim form after the period for its service has run out 'only if' the stipulated conditions are fulfilled. That means that the court does not have power to do so otherwise.'"

13. There is a contrast here with Rule 30.3 which gives the court power to set aside a regular judgment entered in default of appearance or defence. Rule 13.3 provides:

"(2) In considering whether to set aside or vary a judgment entered under Part 12, the matters to which the court must have regard include whether the person seeking to set aside the judgment made an application to do so promptly."

14. Thus under Rule 13.3 the court has to take into account whether the application to set aside was made promptly but, even if it was not, the discretionary jurisdiction to set aside still exists. With Rule 39.3 there is no power to set the judgment aside if the application to do so was not made promptly. This may be hard in individual cases, but it accords with the principle that there should be finality with judgments.
15. The judge in the present case was therefore correct in deciding that there was no power to set the 1992 order aside if Mrs Ray had not acted promptly when she found out that the court had made the order against her. Acting promptly in the context, in my judgment, obviously includes, although it may not be limited to, making the appropriate application to the court promptly. It seems to me obvious from the context that "acted" has to include making the appropriate application to the court. I reject Mr Hill's submission to the contrary.
16. On the facts of the present case there is no possible argument that Mrs Ray had acted promptly. That is the word used in the rule, not, for instance, "reasonably". On her own case she had delayed making any application to the court for six years and three months, a period in excess of the normal period of statutory limitation. Although no doubt what constitutes acting promptly will depend on the circumstances of each individual case, in my judgment it is quite plain that in the present case Mrs Ray did not act promptly. Thus, the judge's decision which was based on a correct interpretation of Rule 35.3(5) turned on a point of fact peculiar to this case. His decision of fact, given the meaning of the rule, is plainly correct, I do not consider that the proposed appeal would raise any important point of principle or practice nor, in my judgment, is there any other compelling reason for the Court of Appeal to hear it, nor would it have any real prospect of success.
17. For these reasons I would refuse permission to appeal.
18. LORD JUSTICE JUDGE: I agree.
(Application refused; no order for costs).