England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM BRISTOL COUNTY COURT
(His Honour Judge Weeks QC)

		Royal Courts of Justice Strand London WC2 Thursday, 30th May 2002

1. LORD JUSTICE CHADWICK: On 9th May 2002 this court (Sir Swinton Thomas and myself) heard a renewed application under reference 2002/0360 by Mr. John Clarke for permission to appeal against a bankruptcy order which had been made against him on 31st January 2001 in the Bristol County Court and upheld on an appeal by His Honour Judge Weeks QC in the High Court at Bristol on 8th March 2001. We dismissed that application for the reasons which we set out in the judgments which we delivered that day. Those judgments should be read with this judgment.
2. Having dismissed the application for permission to appeal - and so put beyond challenge the question whether or not the bankruptcy order of 31st January 2001 was properly made - we thought it appropriate to consider what should be done about three other matters pending before the Court of Appeal, in which Mr. Clarke is either applicant or appellant. Those matters, which are more fully described in our judgments of 9th May 2002, are (i) an appeal under reference 2000/2975 from an order made on 10th August 2000 by His Honour Judge Rutherford in the Bristol County Court in proceedings brought by Mr. Clarke against the Lord Chancellor's Department (sued as the Portsmouth County Court), to which the county court reference is PO906926; (ii) an application for permission to appeal under reference 2000/2975A against an order made on 13th December 2000 by the District Judge in the Bristol County Court in proceedings brought by Mr. Clarke against a barrister, Mr. Craven, to which the county court reference is BS008600, and (iii) an application for permission to appeal under reference 2000/2181 against the refusal on 16th November 2000 by His Honour Judge Bursell QC in the Bristol County Court to grant permission to appeal from an order made on 22nd August 2000 by District Judge Frenkel in that court in proceedings brought by Mr. Clarke against Zurich Insurance Company Limited, to which the county court reference is BS009232.
3. Those three proceedings all arose out of the circumstances in which earlier proceedings, brought by Mr. Clarke against the Zurich Insurance Company and others, under county court references SR850169, SR755955 and PO606057, were heard and dismissed by His Honour Judge Walton in the Newcastle upon Tyne County Court in May 1999. It was the costs order made on 14th May 1999 in those earlier proceedings which provided the basis for the subsequent bankruptcy order in January 2001. Put shortly, Mr. Clarke's complaint was that he was misled by a computerised version of Form N243, issued by the court office at Portsmouth County Court, notifying him that Zurich had made payment into court in those earlier proceedings; and was misled by Mr Craven, counsel for Zurich in those proceedings, in relation to his right to accept that payment and take the money out of court. The difficulty which faced Mr Clarke in May 1999 was that, by the time that he had decided that he wished to accept the monies in court, further costs had accrued by Zurich in preparation for trial. In the event, for whatever reason, Mr. Clarke did not accept the money in court in satisfaction of his claims. The earlier proceedings progressed through a five day trial. Mr. Clarke was unsuccessful in these proceedings, and the costs of those proceedings, subsequently assessed at £25,000 or thereabouts, were awarded against him. The background facts are fully set out in the judgment delivered by Brooke LJ on 13th December 2000 when granting permission to appeal in Mr Clarke's action against the Lord Chancellor's Department (Court of Appeal reference 2000/2975, county court reference PO906926). That judgment, also, should be read together with this judgment.
4. The three matters pending before the Court of Appeal raise questions of importance. First, whether the district judge and the county court judge were not sufficiently independent of the Lord Chancellor, having regard to the terms of their appointments, so as to avoid a perception of bias or a contravention of the Convention right to a fair trial; and, second, whether section 55(4) of the Access to Justice Act 1999 - which precludes an appeal from a refusal to grant permission to appeal - is itself compatible with the Human Rights Act 1998. Those matters were due to be heard by a full court, presided over by the Master of the Rolls, on 5th November 2001. The Treasury Solicitor had instructed counsel to assist the court at that hearing.
5. Very shortly before that hearing - and in circumstances which I described in my judgment of 9th May 2002 - the Civil Appeals Office learned from the Treasury Solicitor that Mr Clarke had been adjudicated bankrupt in January 2001. That raised the question whether Mr Clarke had any standing to pursue the appeal and the applications which were about to be heard. Prima facie at least, the causes of action which were pursued in those actions had vested in the trustee in bankruptcy under section 306 of the Insolvency Act 1986. Those matters were stood out of the list for hearing in November 2001. Little progress has been made in those matters since that date. The view was taken, understandably, that the sensible course was to hear Mr Clarke's application, made by notice dated 9th November 2001, for permission to appeal against the bankruptcy order. If that application were granted and a subsequent appeal allowed, the problems to which the bankruptcy order had given rise would fall away. But if, as has in the event happened, the application for permission to appeal was refused, this court would then be in a position to give directions as to the future progress of those matters in the knowledge that Mr. Clarke is the subject of a bankruptcy order to which there can be no challenge.
6. It is in those circumstances that the three matters to which I have referred are now listed before me for directions. Both Mr. Clarke and the Official Receiver, through counsel instructed by the Treasury Solicitor, have appeared in order to show cause, if they wish, why the appeal and the applications should not now be struck out. As I pointed out in my judgment of 9th May 2002, the position (as it then appeared) was that the person who wished to pursue the appeal and the applications (Mr. Clarke) is not the person in whom the causes of action are now vested. The person in whom the causes of action are now vested, that is to say, the Official Receiver as trustee in bankruptcy, did not wish to, or because he has no funds was not in a position to, pursue that appeal or those applications.
7. The position of the Official Receiver has been confirmed by a report which he has made to this court, dated 29th May 2002. He refers in that report to the history of this bankruptcy, which has included the arrest of Mr. Clarke and his committal to prison for his failure to attend at the public examination ordered by the Bankruptcy Court. Hopefully, that chapter of refusal to co-operate may now be closed because it appears that Mr Clarke has been released from his committal on the basis of an undertaking given to the court that, should his application for permission to appeal from the bankruptcy order be refused, as it has been, he will attend and answer questions at an adjourned public examination.
8. In relation to the three matters pending before the Court of Appeal, the Official Receiver makes two points in his report. first, that at no time has Mr. Clarke requested an assignment of the rights of action so that he can pursue them as assignee; and, second, that the Official Receiver has taken the view that there is no interest of the creditors to be served in continuing the actions in which those three matters arise.
9. The Official Receiver's position has been developed by his counsel in written submissions. Put shortly, the Official Receiver has been advised that, although the points which Mr. Clarke wishes to raise in his appeal and applications are of public and constitutional importance, success on the appeal or on those applications would be of no benefit to the creditors in this bankruptcy. That is because success on the appeal, or on any appeal following success on the applications, would not advance or affect the underlying claims in the proceedings which Mr. Clarke has brought against the Lord Chancellor's Department, Mr Craven or Zurich - that is to say, the proceedings under county court references PO906926, BS008600 and BS009232. The Official Receiver's assessment of the underlying claims in the proceedings is that they are worthless; or are of such minimal value as to provide no foundation for a negotiated settlement with the defendant. Add to that the fact that there are no funds in the bankruptcy to pursue these claims; or, if there are, Mr. Clarke has not disclosed those funds.
10. It is plain, therefore, that, absent a direction from the Bankruptcy Court and provision for funding, the Official Receiver - as the person in whom the claims in those proceedings are vested by virtue of section 306 of the Insolvency Act 1986 - will not be pursuing those claims and has no interest as trustee in bankruptcy in the matters pending in this court. The Official Receiver, as trustee, is content that those matters should now be struck out.
11. Mr. Clarke wishes to pursue the claims; and to pursue the matters pending before this court in the proceedings in which those claims are advanced. But it is plain that he has no standing in those proceedings to do so. The claims have vested in the Official Receiver as trustee in bankruptcy.
12. Whether or not Mr. Clarke has an independent claim for damages or other remedy under section 8 of the Human Rights Act 1998 in relation to the infringement of the Convention rights which he alleges - and, if so, whether that claim, if it arose before 31st January 2001, would itself have vested in the trustee in bankruptcy under section 306 of the Insolvency Act 1986 (as to which I express no view) - that is not the claim advanced in the proceedings to which I have referred. Mr. Clarke cannot, as it seems to me, pursue that independent claim - if it exists and remains vested in him - through an appeal in the three county court proceedings to which I have referred.
13. Mr. Clarke's position, which he advances with courtesy and force, is that Brooke LJ has identified matters of great public importance which should be pursued one way or another. The question is whether there is anyone entitled and willing to pursue them. The directions which I gave on the last occasion has enabled the Official Receiver, with the assistance of the Treasury Solicitor and counsel and with the opportunity to consult the Department, to consider whether or not this is a case in which public funds should be used for that purpose. He has come to the view that it is not such a case. Further, he has come to the view that no public purpose would be served by assigning the claims to Mr. Clarke so that he can pursue those matters. So clear is his view - as he has told me through counsel - he sees no useful purpose in providing further time to enable him to consider any request that might be made to him for an assignment.
14. It is important to keep in mind that the Official Receiver is bound to approach any request for an assignment in the light of the history of non-co-operation which he has set out in his report. He takes the view, in the light of that history and the advice that he has received, that no useful purpose is likely to be served in providing further time for consideration of such a request.
15. In those circumstances, I am satisfied that the proper course to take, at this stage, is to make an order striking out the appeal in 2000/2975, striking out the related application under reference 2000/2975A in the county court proceedings BS008600, and striking out the application under reference 2000/3181 in the action against Zurich in the county court proceedings BS009232. I make that order on the grounds that the person in whom the causes of action are vested does not wish to pursue that appeal and those applications; and that Mr. Clarke, who does wish to pursue them, has no standing in those proceedings to do so.
16. I will direct that Mr. Clarke, on providing to this court a copy of an assignment of the causes of action by the trustee in bankruptcy to him, may apply in writing to this court, within three months from today, to reinstate the appeal and the applications. I express no view as to whether such an assignment would be appropriate; but it seems to me correct, in view of Mr. Clarke's strong sense of grievance in this matter, to leave open the possibility that, if such an assignment were made in his favour, he should be able to restore the appeal in this court. The period of three months may, itself, be extended on a written application to this court, with a copy to the Official Receiver, setting out the circumstances which suggest that any extension of the period would be likely to serve any purpose.
17. I direct that a transcript of this judgment, as well as the judgments delivered on 9th May 2002, should be provided to Mr. Clarke and to the Official Receiver at public expense. I do so because it seems to me important that, on any future application, there be a definitive record of the reasons why I have made the order that I do make today.
Order: Appeal and applications struck out; application for permission to appeal to the House of Lords refused; no order for costs sought; copy of judgment as well as judgments delivered on 9th May 2002 be provided to Mr Clarke and to the Official Receiver at public expense.