England and Wales Court of Appeal (Civil Division) Decisions

IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM CENTRAL LONDON COUNTY COURT
HHJ COWELL

		Royal Courts of Justice Strand, London, WC2A 2LL
		29/01/2013

Lord Justice Pill :

1. This is an appeal against a judgment of His Honour Judge Cowell given at the Central London County Court on 14 February 2012. The judge gave judgment in favour of Mr Hardip Singh ("the appellant") in the sum of £8,709.50, plus interest, but dismissed his much larger claim against Rashed Yaqubi ("the respondent") for hire charges for a Rolls Royce. The appeal is against the dismissal of that claim.
2. The judge found that on 6 August 2009, a Rolls Royce was involved in an accident. It was in collision with the respondent's vehicle in Central London. The judge found:

"In this case the claimant [appellant] is a partner with one Mr Bharat Thakrar in a property development business. One of the fleet of seven vehicles owned by the partnership was involved in a minor accident".

3. The judge found for the appellant on the issue of liability. The judge summarised subsequent events. The damage to the Rolls Royce was a dent to the rear door on the near side. The appellant was anxious, the judge found quite reasonably, for the vehicle to be returned to the expert suppliers in Birmingham from whom he had purchased it. Though the vehicle was drivable and was driven after the accident, it was accepted that repair was required.
4. The vehicle was carried to Birmingham on 11 August 2009 for repair. The appellant hired a Bentley for five days and then a Rolls Royce was hired. The appellant had notified his insurers and made a statement for Accident Exchange Ltd, the company that provided the hire car.
5. The insurer's engineer did not inspect the damaged Rolls Royce until 11 September 2009. The repairs to the rear door were completed on 29 September and the hire ended on 30 September. The total amount claimed for hire charges of the Bentley and the Rolls Royce was £99,439.06, with a daily rate of about £2,000 for the Rolls Royce. In the course of the hearing, that figure was adjusted to £92,953.90.
6. The judge dismissed the hire claim in its entirety but went on to consider what award he would have made had it been reasonable for the appellant to hire a Rolls Royce. The appellant submitted written evidence of charges and the respondent called a witness, Miss Bennett, who gave oral evidence on the basis of enquiries made. The judge accepted her evidence, giving reasons, that a Rolls Royce could have been hired for the relevant period for £21,428.57.
7. There are three grounds of appeal, the first challenging the judge's finding on need and the second his finding as to the appropriate sum to be awarded if need for a hire vehicle was established. Permission to appeal on those grounds was granted by the judge. No application was made either to the judge or on notice to this court, for permission to appeal on the proposed third ground: serious irregularity by reason of the judge's apparent bias. Permission to appeal on this ground was sought at the hearing. It had featured in grounds of appeal and in both skeleton arguments. Mr Hough, for the respondent, opposed the application but did not claim to have been prejudiced by its lateness. The court granted permission in the course of the hearing, notwithstanding the lateness of the application.
8. Mr Williams, for the appellant, rightly took the irregularity ground first. He indicated that, if he failed on that ground, he would not pursue ground 2, accepting that on the evidence, an unbiased judge was entitled to accept the lower figure. If he succeeded on the third ground, there would need to be a re-trial in any event.

Bias

9. The serious irregularity is said to be a hostile animus shown by the judge towards to the appellant and his case in the course of the judgment. The appellant is a rich man and the damaged Rolls Royce was worth in the region of a quarter of a million pounds.
10. On behalf of the appellant, Mr Williams said that he was not claiming actual bias but an appearance of bias. The judge's comments, in the course of his judgment, were such that a fair-minded and informed observer would conclude that the judge was unable to bring an objective judgment, uninfluenced by extraneous factors, to bear on the issues in the case.
11. In the last paragraph of his judgment, the judge stated that he was "very conscious that this judgment has been given extempore, shortly after the conclusion of argument" adding that he "would have preferred a little more time to reflect and to have given judgment tomorrow". He added that because that would not have been convenient to counsel he had decided to give judgment on the day. The judge began his judgment by saying that it was "almost the last judgment I shall ever give after 15 years of doing justice according to law to the best of my ability."
12. The comments complained of are in paragraphs 1, 2, 3 and 8:

"1. . . . This case raises the moral question which has occasioned me much anxious thought, whatever answer the law gives to the facts of this case which has occasioned further even more anxious thought, whether the ever increasing insurance premiums of the ordinary motorist, particularly one struggling to make ends meet and needing a modest car to go to work, should in some part be used so that the rich may continue at no expense to themselves to be filled with good things that they think they need.

2. . . . The claim was defended both as to liability and as to quantum. The temptation to give a perverted judgment on liability against the claimant in order to avoid all questions of quantum was very great, but conscience and my judicial oath meant that the temptation was successfully resisted."

13. At paragraph 3, the judge noted the appellant's evidence that he was in the property business dealing with millionaires and related investments and used the Rolls Royce "to maintain the correct impression in such circles." He needed "to maintain his image and that of his partnership . . . maintenance of image of success was paramount". The judge commented:

"Well, what a testament that is to the superficial if not false nature of the warped values of society, or as the claimant himself put it 'that is how these people see it', referring to a list of celebrities which I will come to in a moment that the claimant had as his clientele. That is a very subjective view which, as I shall explain, is unsupported by detailed evidence."

I need not recite the list of celebrities named.

14. Complaint is also made of comments at paragraph 8. The judge cited, at paragraph 7, the speech of Lord Mustill in Giles v Thompson [1994] 1 AC 142, with which the other members of the Committee agreed, at 167G:

"The discipline imposed by judges who have the acumen and experience to detect greed and slapdash claims procedures will in my opinion do much more to forestall abuse than a dusting-down of the old law of champerty."

Judge Cowell stated:

"In these circumstances there is the obvious feature that the party signing the hiring form is ordering riches for himself at another's expense, and that is just the sort of situation which the courts ought to investigate rather carefully, whether it is right that that other, who is bearing the expense, ought properly to bear that expense. The law, it seems to me, ought to be, if it is not already, that that other is entitled to be presented with clear factual evidence of need on the part of the claimant."

The judge then quoted a verse from Hilaire Belloc's poem about the elephant who is supplied with many tons of hay a day. ("The Elephant" from the Bad Child's Book of Beasts). This was said by Mr Williams to amount to facetious comment.

15. It was also submitted, though somewhat faintly, that the judge's finding of fact as to hire rates demonstrated a hostile animus.
16. The comments were unfair, submitted Mr Williams, because the appellant was not trying to profit at the expense of another. He merely wanted an equivalent vehicle while his damaged Rolls Royce was being repaired. A fair-minded and informed observer would conclude from the references to the rich being filled with good things, to the temptation to give a perverted judgment on liability and to the warped values of society that the judge was unable objectively and in accordance with legal principle to make a sound judgment upon a claim by a rich man for a large hire charge. The comments indicated active hostility towards the appellant's claim, it was submitted, though an allegation of actual bias is disclaimed.
17. The question is whether the circumstances described would lead "a fair-minded and informed observer to conclude that there was a real possibility that the Tribunal was biased" (Porter v Magill [2002] 2 AC 357, at paragraph 103 per Lord Hope of Craighead). Mr Williams referred to Timmins, a personal injury case and one of the cases considered in Locabail v Bayfield Properties [2000] QB 451, at pages 491 to 496. This court, Lord Bingham of Cornhill CJ presiding, concluded "not without misgiving" that an appeal should be allowed where the Recorder, who was a "prolific writer" on legal issues, made comments in articles "written in close proximity to the trial" in one of which the Recorder had "vehemently complained" of the conduct of an insurance company and, more generally, had expressed "pronounced pro-claimant anti-insurer views" (page 496).
18. In The Queen (on the application of Kaur) v Institute of Legal Executives Appeal Tribunal [2011] EWCA Civ 1168 Rix LJ, at paragraph 49, described the underlying principle as being "to guard against the insidious effects of which those concerned are not even conscious."
19. In this case, the judge expressed views on the values of society openly and frankly, including correctly citing the appellant's own evidence that "it is materialistic but that is how these people see it." When it came to stating legal propositions, the propositions stated at paragraph 8 appear to me to be sound including the proposition that "courts ought to investigate rather carefully" claims such as the present.
20. The judge did in fact find for the appellant on liability, following a contested hearing, and rejected a submission on behalf of the respondent that the time taken to inspect and repair the Rolls Royce (54 days) was too long. He accepted the reasonableness of referring damage to a rear door to specialist suppliers in Birmingham. No criticisms are made of the judge's conduct of the hearing or of the fairness with which, in his judgment, he summarised the evidence.
21. There is no claim of actual bias and no evidence of a predisposition to find against rich men or against claimants. The comments that were made were made consciously and openly.
22. The court puts itself in the place of a fair-minded and informed observer. Such an observer would not in my judgment doubt the ability of the judge to consider the evidence fairly and objectively. Such an observer would be well aware that judges are not infrequently placed in a position where the application of legal principles to the evidence requires them to reach a conclusion contrary to moral views they may hold or views they may hold on social values. A judge's training, experience and instincts are to apply legal principles regardless of his own view.
23. There is nothing in this case to suggest that the judge neglected his duties or overlooked his responsibilities. Comments of the kind made by the judge are not to be encouraged but the manner and openness of their expression in this case encourages rather than discourages a conclusion that he was well aware of his responsibility to consider the evidence fairly and to decide the case, not on personal whim, but on legal principles and in accordance with the evidence. I reject this ground of appeal.

Hire Charge

24. The appellant's claim is that an expensive Rolls Royce has been damaged and he was entitled to hire a similar Rolls Royce while it was being repaired. A tortfeasor takes his victim as he finds him (Scrutton LJ in The Arpad [1934] P189, 202).
25. Mr Williams accepted that it is a basic principle that a victim must always act reasonably but argued that there was a burden on the respondent to show that the appellant had acted unreasonably in replacing the Rolls Royce. Emphasis is placed on the burden of proof being on the respondent.
26. The claim was put as a claim for a specific sum by way of special damage. Mr Williams accepted that a claim for general damages, which need not be particularised, was not made at the trial and cannot be made at this stage. The issue is whether the specific claim for a sum by way of hire charges is made out.
27. The judge took as his starting point the speech of Lord Mustill in Giles v Thompson, a part of which I have already cited. Lord Mustill stated, at page 167D:

"The need for a replacement car is not self-proving."

Lord Mustill added:

"Thus, although I agree with the judgments in the Court of Appeal that it is not hard to infer that a motorist who incurs the considerable expense of running a private car does so because he has a need for it, and consequently has a need to replace it if, as the result of a wrongful act, it is put out of commission, there remains ample scope for the defendant in an individual case to displace the inference which might otherwise arise."

In the Court of Appeal, Steyn LJ had stated, ([1993] 3 All ER 321, 337h):

"For my part I readily accept that a plaintiff must show a reasonable need for a replacement car in order to recover special damages."

28. Judge Cowell continued his analysis, at paragraph 9, by stating that "one of the great problems in this case is really the absence of detailed evidence". The judge took the hypothetical case of a self-employed plumber whose car is damaged:

"What evidence would anyone acting for him tell him to put together in order to prove his need of the hire car? It seems to me that, properly advised, he would give evidence about two things: first, he would give evidence of his actual use prior to the accident of his vehicle damaged in that accident, perhaps by reference to his diary that he would exhibit, though he would not have to exhibit any document for he might remember where he was during that period. At any rate, if there are documents he would refer to them and he would say 'I am reminded by looking at my diary which is exhibited that I made four journeys to such and such a place with all my equipment in my car; the following week I did this, that or the other' and so on. Then, secondly, one would advise him as a claimant to say what use he made of the hired vehicle, for example, where did he go during the course of the hire. It is the equivalent of all that which is completely missing in this case. That is why it is a particularly difficult one."

29. I have set out the judge's findings of fact, which are not challenged, at paragraph 2 above. The judge continued his analysis at paragraph 10:

"The partnership of which the claimant was one of two partners, the other being Mr Thakrar, had at their disposal six other cars, all of a fairly prestigious make, and they were all insured under the same policy of insurance."

The judge dealt in detail with the circumstances of the partnership, its members, and their families and their use of the vehicles. The vehicles were a Mercedes CL600, a convertible Rolls Royce, a Bugatti valued at €1.4 million, a Range Rover Overfinch, a Mercedes S320 Cdi and a Porsche traded in on or about 7 August 2009 for a Range Rover Sport HSE. The judge noted, though it is of little relevance, that oral evidence emerged that in the autumn of 2010 the damaged Rolls Royce was traded in for a new one costing £320,000. The judge continued, at paragraph 19 and following:

"19. It was also pointed out by Ms Beslee [counsel] that there was no detail given of the user of each of the other vehicles and when they were used. It may be that to ask for that could be said to be going a little far, but what in my judgment is a very crucial omission is that nobody has given evidence of the actual user of the Rolls-Royce that was later damaged during period before 6^th August for example, for the period of a month or six weeks before, or whatever, and nobody has given evidence of the actual user of the hired Rolls-Royce during the period of hire. It would not have been difficult by reference to a diary at work, even to the memory of those who were at work, as to what use was made, and in particular which celebrity was carried on what occasion before the accident in the car that was later damaged, from one place to another and similarly which celebrity was carried in the hire car. There is no evidence of that at all.

20. The claimant himself was abroad, as his old passport showed, in Turkey between 22^nd and 28^th August 2009 during the hire period. He believes that the Rolls-Royce was used during that period, he said, for moving clients around. But there is no detail of that at all. All I have is evidence of a very general kind. His, the claimant's, belief is that the Rolls-Royces were used for these purposes but I have no detail whatever.

21. . . . there is no evidence in any of the witness statements of any detail of the user, so this case does raise the extremely important point: should not the same sort of evidence which I have given in the hypothetical case of the plumber have been given in this case? If it had been given, if only at the witness statement stage, exhibiting such documents as there are (and I am aware that not everything is to be proved by documentation), such as statements by the drivers identifying the celebrities and dates, if that sort of evidence had been given it would give substance to the evidence of the claimant, even that the need was to maintain his image.

22. It is said by Mr Delaney on behalf of the claimant that, according to the passage in Lord Mustill's speech, the burden is on the defendant to prove the absence of need. I do not think that the situation is as simple as that. It seems to me that if the inference can be displaced that there is need, in this case by the fact that there were six other vehicles, then the burden must shift to the claimant to give detail, in this case in particular of what the actual use of the Rolls-Royce before the accident was and what it was of the hired car afterwards. All that evidence is only within the knowledge of the claimant, and so the defendant is simply questioning in the dark, and the defendant has no evidence to adduce about the matter at all and has no material upon which to contradict the generalised statements made by the claimant. So that is the huge gap in this case. Courts ordinarily can only act on factual evidence, and particularly when a claim is for such a large sum it seems to me that the cogency of the claimant's evidence should be all that much greater."

30. Having noted the appellant's belief that the hire charges would be paid by his own insurance company, the judge concluded, at paragraph 24:

"In view of the paucity of the evidence and the lack of detail I find that there is no clear evidence upon which I can conclude that need has been proved . . ."

31. Reasons were given orally by Mr Singh as to why the other vehicles could not serve as a replacement for the damaged Rolls Royce. They included non-partnership use such as the appellant's wife using the Range Rover Overfinch for her own purposes and for taking the children to and from school. The Mercedes S320 was used by another family member, the appellant's brother, although the judge found:

"I do not know what it had to do with the partnership."

The judge made no specific findings as to which of the vehicles, if any, could have substituted for the damaged Rolls Royce; his conclusion was based on the absence of evidence of need.

32. Mr Williams relied, in particular, on the statement of principles by Aikens LJ in Pattni v First Leicester Buses Ltd [2011] EWCA Civ 1384, 2012 PIQR Q1, at paragraph 32(3):

"The injured party cannot claim reimbursement for expenditure that is unreasonable. If the defendant can show that the cost that was incurred was more than was reasonable, either by proving that the claimant had no use for a replacement car in part or at all, or because the car hired was bigger or better than was reasonable in the circumstances, the amount expended on the hire must be reduced to the amount that would have been needed to hire the equivalent to the damaged car. As Lord Mustill put it in Giles v Thompson, '…The need for a replacement car is not self-proving'."

The respondent has not proved, Mr Williams submitted, that the appellant had no use for a replacement car in part or at all. In the circumstances, to find for the respondent was to indulge him. Mr Williams accepted, however, that a claimant must show reasonable need for a replacement car in order to place a burden of proof on the defendant. He submitted that sufficient evidence was given by the appellant to demonstrate that need had arisen.

33. In my judgment, there was a burden on the appellant to show a reasonable need for a replacement Rolls Royce during the period of repair. The required need was, as the case was put and on the judge's agreed findings, the need of the partnership. Such need is not self proving (Lord Mustill in Giles). That is the first question and, if need is not proved, detailed questions arising out of the reasonableness of measures in mitigation do not arise.
34. I do not consider that Aikens LJ's judgment in Pattni, with which I agreed, sought to alter that. Lord Mustill's proposition in Giles was cited in the very paragraph in Pattni on which Mr Williams relies. Moreover, at paragraph 73, Aikens LJ summarised the questions to be asked and the first was "did the claimant need to hire a replacement car at all?"
35. Mr Williams suggested that the basic statement of principle by Lord Mustill in Giles has been weakened by subsequent cases such as Lagden v O'Connor [2004] 1 AC 1067 and Diamond v Lovell [2002] 1 AC 384. I do not accept that; Lord Hope in Lagden, at paragraph 27, made his analysis contingent on it being reasonable for the victim to hire a substitute.
36. In Beechwood Birmingham Ltd v Hoyer Group Ltd [2011] QB 364, the issue was whether there was a need to hire a replacement car at all. Sir Mark Potter P, with whom Dyson LJ and Maurice Kay LJ agreed, cited Giles and Langdon and, at paragraph 28, cited with approval the judgment of His Honour Judge Charles Harris QC in the Oxford County Court in Park Lane BMW v Whipp, (unreported) 20 May 2009. Judge Harris referred to the "long established principle that a claimant must prove . . . that a replacement car was reasonably necessary." Sir Mark Potter cited that part of Judge Harris's judgment at paragraph 16:

"It might have been possible for Park Lane to have called evidence to establish that it had or would have had the need to use the limousine showing what his diplomatic commitments were or were expected to be and explaining what the substitute car was in fact used for. But it did not bother to do so. Consequential loss, special damage of the type here, does not prove itself."

37. Sir Mark Potter also stated, at paragraph 46, that dicta of Lord Scott of Foscote in Lagden in the course of which he said that "the hiring of a substitute car cannot be regarded as a step taken in mitigation of loss" (paragraph 79), were limited to the context in which they were uttered, "a private motorist claiming in respect of a substitute vehicle". A private motorist may not be able to predict, or be expected to predict, what particular use will be made during the period of hire. She may, as Lord Scott put it, at paragraph 79, hire: "to have the convenience of a car available for daily use, not in order to avoid some financial loss that she might otherwise have incurred for want of the use of a car."

Conclusions

38. Need was put in issue in the pleaded defence and at the hearing before the judge. It was for the appellant to establish it. The judge was not required, on the evidence, to infer it. If the appellant had established it, it would have been for the respondent to show that the need had not been met in a reasonable manner.
39. While Mr Singh's claim was a personal one, he relied on the need of the partnership, for business purposes, for a replacement Rolls Royce during repair. In my judgment, the judge was entitled to find that need had not been established. Very large hire claims such as this one should be scrutinised carefully by the court and particularly when the business partnership, which was required to establish the need, had a fleet of seven prestigious cars on the same insurance. For such a business claim to succeed, the judge was entitled to require specific evidence of need, such as evidence of the actual use of the vehicle for business purposes before the accident and the use to which the hired vehicle was put during the period of hire. Such evidence as was given, was vague and non-specific and the judge was entitled to hold that the need for a replacement Rolls Royce had not been established.
40. Appropriate evidence could be expected to have been readily available and the judge was entitled to require it when considering a claim for £2,000 a day for the use of a vehicle. The judge referred to the "huge gap" in the case. He was entitled to find against the appellant on an issue on which the appellant needed to succeed, that is, the need for a Rolls Royce during the relevant period.
41. I would dismiss this appeal.

Lady Justice Black :

42. I agree.

Sir Stanley Burnton :

43. I also agree.