England and Wales Court of Appeal (Civil Division) Decisions

IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
MR DAVID DONALDSON QC SITTING AS A DEPUTY HIGH COURT JUDGE
[2012] EWHC 1991 (Ch)

		Royal Courts of Justice Strand, London, WC2A 2LL
		4th July 2013

Lord Justice Floyd:

1. The parties were unable to agree a number of issues consequential on the judgment which we have handed down on the appeal. We have received written submissions on these issues from the parties, including in this instance the third party. This is the judgment of the court on those issues.
2. We think that the declaration should be in the following form to reflect the fact that the order for sale has not yet been made:

It is DECLARED THAT the Appellant is entitled to be subrogated to an equitable charge by way of an unpaid vendor's lien over the property known as and situate at 2 Great Oak Court, Hunsdon, Ware, registered at HM Land Registry under title number HD495722 ('the Property'), pursuant to which (in the event of a sale of the Property pursuant to the counterclaim) from the net proceeds of sale of the Property, there shall first be paid to the Appellant £875,000 plus interest thereon at the lesser of:

(a) the interest rate that would have been payable under the contract of sale by the Respondent to her vendor for late completion; and

(b) the interest rate applicable to the debts owed to the Appellant by Mr and Mrs Menelaou, and which would have been secured by the purported first legal charge over the Property dated 12 September 2008 and which was registered against title to the Property but was declared to be void and of no effect by paragraph 1 of the Order of David Donaldson QC dated 23 October 2012.

3. We consider that the costs order which the judge made in favour of the respondent on her main claim should not be disturbed. That claim raised separate issues on which she was successful and from which there was no appeal.  The "without prejudice save as to costs offer" does not affect the position, as the respondent was entitled to have the register rectified to remove the legal charge. The appellant and third party should have conceded the respondent's case before she incurred the costs of bringing it to trial.  The equitable charge which she has succeeded in establishing on this appeal is not in all respects equivalent to the legal charge which the judge held to be void.
4. The sum on account of costs which the judge ordered the appellant to pay to the respondent should be repaid. Although the outcome of the costs assessment is not known, it no longer justifies a substantial payment on account in favour of the respondent. For similar reasons we do not make any order for payment on account of the appellants' costs of the appeal and the counterclaim below.
5. As we are not varying the order for costs in respect of the respondent's claim below, we make no order varying the way in which costs were dealt with as between the appellant and the third party by the judge's order.
6. We refuse permission to appeal to the Supreme Court.