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 CHANCERY DIVISION
(ETHERTON J)

		Royal Courts of Justice Strand London, WC2
		22 November 2004

1. LORD JUSTICE CHADWICK: This is a renewed application by the respondents for permission to cross-appeal on grounds 1 to 3 in section 6 of the respondents' notice lodged on 24th June 2004 in a pending appeal in proceedings between Jemma Trust Company Limited and Kippax Beaumont Lewis and others. The claimants have permission to appeal granted by the judge.
2. In the course of his judgment Etherton J made certain findings in relation to the basis upon which an assent to the vesting of a fund known as the Hulton Land Fund was executed on the advice of Kippax Beaumont Lewis (KBL). In particular, he addressed the question whether that assent had been the subject of positive advice from tax counsel, Mr Robert Venables QC and Mr Robert Grierson, at a consultation on 19th November 1996. It was KBL's case that Mr Venables had given advice to the extent that the assent should be executed. They adduced oral evidence to that effect from two of those present at the consultation. They did not adduce evidence from Mr Venables himself. That was explained, it is said, by the fact that the issue only emerged at a relatively late stage in the proceedings and that a decision was taken not to risk delay and expense - including the possibility of the judge finding it necessary to recuse himself - by seeking to introduce Mr Venables' evidence at that stage.
3. KBL relied at the trial on the contemporary approved note of the consultation, initialled by counsel on 10th December 1996, which (in the version that has been put before me) has a number of amendments, apparently in counsel's handwriting. It was said that those notes - which do not include any express reference to the assent - were consistent with the evidence given by those at the consultation; and that those at the consultation, including Mr Forrester and Mr Liptrott, believed that the advice which they had received was to execute the assent. The judge did not reject the evidence that that was their belief. But he held, first, that on a proper understanding of the attendance note that advice had not been given; and second, that it was not reasonable for them to think that it had been.
4. By their respondents' notice, KBL seek to challenge those findings. Put very shortly, paragraphs 4 to 13 in the first part of section 6 of the respondents' notice make the assertion that, whether or not Mr Venables had given express advice as to the assent, it was reasonable for Mr Forrester and others to think that he had done so. I was persuaded on the papers that that was a contention which the respondents should have permission to advance at the appeal. I was not then persuaded that the respondents should be allowed to challenge the judge's findings, on the material before him, that there had been no advice, in express terms, that the executors should assent to the vesting of the Hulton Land Fund. A challenge on that basis that was sought to be really involved setting aside the judge's findings on the oral evidence which had been given -- which, as he held -- contradicted what he understood to be the effect of the consultation note.
5. The respondents renew the application in respect of grounds 1-3 at this oral hearing. They seek to support the renewed application by an ancillary application to adduce evidence from Mr Venables as to what he thought and recalled had been his advice in November 1996. But it is plain that the decision not to call Mr Venables at the trial was a decision taken deliberately and after taking into account commercial considerations. I do not criticise that decision. The respondents thought that their evidence, coupled with the attendance note, was of sufficient force to make it unnecessary to call oral evidence from Mr Venables. And it must be kept in mind that a court investigating what had happened at a meeting between tax counsel and professional advisers in November 1996 (some seven years or more before the trial) is likely to place little weight on what the parties say they remembered, and much weight on their written contemporary record of the meeting.
6. In my view, this is not a case in which the further evidence should be adduced in the Court of Appeal. There was a deliberate decision not to introduce that evidence at the trial. The appellate process - and the administration of justice generally - cannot function efficiently if parties, having decided not to call evidence at a trial because they believed that they can do without it, are then able to call that evidence on appeal when they have discovered that the judge did not share that view.
7. So I would dismiss the application to call further evidence. I have in mind that, if such evidence were called, it would almost certainly be the subject of challenge, leading either to an application to cross-examine at the appeal or the need for a new trial in which it could be placed in context with the evidence that was in fact called at the trial. For that reason, also, this is not a case, in my view, in which the court should give permission to adduce further evidence unless there was a compelling need to do so in order to do justice.
8. That leaves the question whether or not the respondents should nevertheless be entitled to argue that the judge was wrong in his conclusion that no advice to execute assent was in fact given. Paragraph 3 in section 6 of the respondents' notice is in these terms:

"[The learned judge] wrongly interpreted the notes of conferences with counsel so as to conclude that no advice in favour of the 1997 assent was in fact given."

And paragraph 4 reads:

"[The learned judge] wrongly failed to conclude that, even if Mr Venables had not expressly advised the assent of the Hulton Land Fund by the executors to themselves as trustees, it was nevertheless reasonable for the First Defendant and/or the Executors to believe that Mr Venables had so advised."

9. On looking at the matter again, it seems to me that, if the respondents are to argue at the appeal - as they are entitled to argue in the light of the permission already given - that it was reasonable for Mr Forrester and others to believe that Mr Venables had advised in favour of the assent then it would be impossible for the court to avoid forming its own view (at least prima facie) as to the meaning of the note of conference dated 11th November 1996. That does not mean, of course, that the court will necessarily conclude that that note contains positive advice. But in deciding whether it was reasonable for the respondents to think that it did, the court is bound to be led into considering what it (the court) thinks that the document means and how far there is room for a different view.
10. So I will vary the order of 21st September 2004 by including permission to appeal on ground 3 in the first part of section 6.
11. MR HAM: My Lord, there remains the question of costs. My Lord so far as the renewed application is concerned, I would respectfully suggest it should be costs in the cross appeal. So far as the application to adduce evidence from Mr Venables is concerned, I would ask for those on behalf of the appellant.
12. MR FENWICK: I suppose it is worth spending five seconds persuading your Lordship that because I had won on one and lost on the other that your Lordship should order everything to be costs in the cross appeal, but I do not think I can say much more than that.
13. LORD JUSTICE CHADWICK: No. The respondents, as applicants, are to pay the appellants' costs of the application to adduce further evidence. The remaining costs are to be costs in the appeal.