England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
CIVIL DIVISION
ON APPEAL FROM THE HIGH COURT
QUEEN'S BENCH DIVISION
(Mr Justice Curtis)

		The Royal Courts of Justice The Strand London Wednesday 15 May 2002

Wednesday 15 May 2002

1. MR JUSTICE HART: This is an application for permission to appeal against the order of Curtis J dated 25 October 2001, dismissing an appeal from an order of Master Prebble made on 20 June 2001. Master Prebble had acceded to an application by the defendant to strike out the claimant's claim, which was made on the basis that it:

"... [disclosed] no reasonable grounds for bringing the claim and that it is an abuse of the court process because the claimant knows that it has no claim against the defendant."

2. The claim in respect of which that application was made was a claim which had been issued on 7 December 2000, whereby the claimant asserted as follows (and I quote from the details of the claim):

"On 11 November 1994 I delivered 297 Italian bonds, known as CCTs, each with a face value of 10Million Italian Lira, to the Defendant at its Genoa offices for verification of genuineness. Notwithstanding my numerous requests for a reply and return of the CCTs, it was not until 6 July 1995 that I was informed by the Defendant that it could not return the CCTs.

I seek an order for the return of the CCTs or their value plus interest accruing since the maturity date of each CCT."

3. Then, under "Value":

"Since the maturity dates of the CCTs have been reached, unless the Defendant returns the CCTs, I expect to recover 297 Million Italian Lira plus interest or the equivalent in Sterling at the current rate of exchange."

4. The defence to that claim was served on 8 January 2001 on behalf of the bank. By paragraph 1 of the defence, it was pleaded as follows:

"1. On 11 November 1994 the Claimant lodged at the Defendant's office in Genoa, Italy 297 Italian treasury bonds ('CCTs') each having a face value of Italian lire 10 million. The Claimant requested that the bonds be deposited in a new account in his name.

2. The Defendant had doubts about the authenticity of the CCTs. As a result, the Defendants were under a legal obligation to report the matter to the police. On 14 November 1994, a judge from the Court of Genoa ordered the seizure of the CCTs.

3. On 26 July 1995 the Defendant's office in Genoa made a request to the judge that the CCTs be sent for verification to the Italian Treasury in Rome.

4. The CCTs have been examined by the Italian Treasury and shown to be false. As a result the seizure order remains in force, with the CCTs remaining at the Italian Treasury.

5. The Claimant has been kept fully informed of the matter throughout.

6. The Claimant has been convicted, in his absence, by the Court of Genoa in a judgment dated 26 November 1996, of the crime of assisting in attempting to pass these CCTs to the Defendant in order to obtain their face value in Italian Lire, contrary to Article 428 and 453 no 3 of the Italian Penal Code. The Claimant was sentenced to three years imprisonment and a fine of Italian lire 3 million and costs. The Claimant has neither served his sentence nor paid the fine.

7. In the circumstances, the Claimant is not entitled to the Order sought or any other order or judgment in this matter."

5. The defendant bank thereafter launched its application to strike out, supporting it by a witness statement of Mr Sear, a partner with the defendant's solicitors, Radcliffes, who deposed in terms which confirmed the defence and which exhibited various documents. In particular, there was exhibited the petition by the bank seeking an order that the CCTs be sent to the Italian Treasury for verification and the order of the court made on that petition acceding to it. There was also exhibited an order of the Court of Genoa in which the Court declared, among other things, that the CCTs were forgeries. On that evidence, Master Prebble acceded to the application. It would appear that the principal issue being argued between the parties at that stage was whether the bonds were forgeries, as found by the Genoa court, and that the Master proceeded on the basis that he could accept the finding of the Genoa court.
6. The claimant appealed from Master Prebble, essentially on the ground that until the service of the defendant's defence in this action, he had been unaware of the proceedings in the Genoa court and he therefore took the stance that it was contrary to his rights to a fair trial under Article 6 of the Convention that he should be bound by a judgment which had been given in his absence and which he had had no opportunity of challenging. In order to remedy what the bank perceived as a possible defect in its evidence in support of its application, it sought on the appeal before Curtis J to put in evidence the certification by the Italian Treasury that the bonds were forgeries, that having been the critical evidence, apparently, before the court in Genoa. That evidence, which was exhibited to a witness statement of Mr Woolhouse dated 24 October 2001, was served on the claimant only the day before the appeal hearing. However, Curtis J admitted that evidence on the appeal. It does not appear that any attempt was made by the claimant to seek an adjournment but, the evidence having been admitted, it formed an element in Curtis J's decision that the evidence was clear that the bonds were forgeries, and he dismissed the appeal accordingly.
7. The application for permission which is made to us is made on the basis that the decision of Curtis J to admit the evidence of the Italian Treasury's certification that the bonds were a forgery constituted a serious procedural irregularity in the proceedings before Curtis J and that we should grant permission to appeal for that reason.
8. In so far as the decision of Curtis J, and indeed of Master Prebble, that the claim should be struck out depends on the issue of whether or not the bonds were forgeries, it seems to me that some criticism can certainly be made of the defendant bank for not having put the appropriate evidence before the court at the stage of its original application and that criticism can also be made of it for not having served the additional evidence until immediately prior to the hearing before Curtis J.
9. On the question whether Curtis J should have permitted it to be relied on on the appeal, the question was one essentially, as it seems to me, for him in the light of the stance which the parties were at that time respectively taking. So far as the bank was concerned, it was relying on the certification by the Italian Treasury as simply being better evidence than it had so far adduced of the underlying proposition for which it had already contended in the witness statement served on its behalf and as evidenced by, among other things, the order of the Genoese court that the documents were forgeries. The claimant was not in any position to challenge, and indeed had not challenged at any stage by any positive averment, the proposition that the bonds were forgeries. In his reply he had neither admitted nor denied that proposition. It was, therefore, as it seems to me, a question on which the bank was entitled to put before the court the best evidence which it had in support of that proposition.
10. The real question for the court, both at first instance and before Curtis J, was, as it seems to me, whether it had sufficient material before it to accede to the defendant's application. Had there been any real prospect of the claimant being able to put in evidence before Curtis J, either at that or some adjourned hearing of the appeal, some evidence which cast some substantial doubt on the authenticity of the certificate by the Italian Treasury, I can see that it could undoubtedly be argued that there was a serious procedural irregularity in not affording the claimant that opportunity. However, the position remains to this day that no such case is sought to be put forward by the claimant. Indeed, it may be said his complaint is that he is not in a position, without disclosure and other interlocutory steps, to even begin to make such a case.
11. The real difficulty, as it seems to me, with the claimant's case, and in particular with his appeal to this court, is that it does not necessarily depend on whether or not the bank can establish that the bonds were forgeries, or whether the bank has produced the best evidence available of that proposition. As Mr Riza QC, who has appeared on behalf of the claimant, conceded in the course of argument, the fact that the bonds were seized by the police under apparently lawful authority a mere three days after they had been lodged by the claimant with the bank, and that they continue to be subject to that seizure, is a complete answer to the claim which is made by the claimant against the defendant for the unlawful interference with his goods. Accordingly, the whole saga as to whether or not the bonds are actually forgeries seems to me to have nothing necessarily to do with the answer to the claimant's claim.
12. The only remaining question, therefore -- and it is one which arises whether one regards the true issue as being whether the bank has a defence to the claim in conversion on the ground that the bonds are the subject of a lawful seizure; or has an answer on the grounds that the bonds are in any event forgeries -- is whether the bonds which have been, it is acknowledged, seized by the police, and the bonds whose status as forged bonds has been asserted by the Italian Treasury, are indeed the same bonds as were lodged by the claimant with the defendant on 11 November.
13. So far as that is concerned, we have been taken by Mr Pelling, on behalf of the bank, to the various documents which have been exhibited and which identify the bonds the subject of, first, the seizure; secondly, the petition by the bank for their transmission for verification and its subsequent order and the certificate of the Italian Treasury itself. Nothing in those documents establishes to a degree of 100 per cent certainty that they are the same bonds. But what is established by those documents, as I read them, is that the bonds which were finally declared to have been forgeries were indeed the bonds which had been sent to the Italian Treasury for verification pursuant to the order of the court to that effect, and those were indeed the same bonds as had been seized by the police on 14 November 1994. The only missing link which could finally exclude the fantastical hypothesis that in the period between 11 November 1994 and 14 November 1994 the bank had itself forged 297 bonds of the equivalent denomination and then allowed those forged bonds to be seized by the police, seems to be the absence in the evidence before us of the list of bonds said to have been attached to the order of the Italian police made on 14 November 1992. That order was copied to the claimant by a letter from the bank dated 6 July 1995, and I can find no trace in the subsequent correspondence which the claimant has placed before us of any suggestion by the claimant that the bonds seized were not the bonds lodged by him until that suggestion comes to be made in connection with the defendant's application to strike out some six years later.
14. In all the circumstances, it seems to me entirely clear that the claimant's claim has no real prospect of success whatsoever, and that there is no reason why we should grant permission to appeal.
15. LORD JUSTICE LATHAM: I agree.
ORDER: Applications refused with costs summarily assessed at £3,000 exclusive of VAT. (Order not part of approved judgment)