England and Wales Court of Appeal (Civil Division) Decisions

IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE COUNTY COURT
SITTING AT LEICESTER

		Royal Courts of Justice Strand London, WC2A 2LL
		15 April 2014

1. LORD JUSTICE DAVISThis is an appeal by Mr Franklin against the costs order made at the conclusion of a trial by HHJ Hampton sitting in the Leicester County Court, her decision being given on 31 August 2012. Leave was refused on all the points sought to be raised on an application for permission to appeal by Leveson LJ.
2. Permission to appeal was granted subsequently after an oral hearing by Elias LJ, but permission was limited to one particular point. That point relates to the question of costs and, in particular, whether the judge was justified in ordering Mr Franklin to pay the costs of the second Defendant, Mr Hunt, on an indemnity basis, Mr Franklin having failed in his claim against Mr Hunt. Although Mr Franklin, as I have said, had a number of other grounds, those are no longer open to him to pursue.
3. The background, very shortly stated for present purposes, is rather unusual. In October 2001, the local police force conducted investigations into the disappearance of two men. It was suspected that they had been murdered. At the time, Mr Franklin ran two auto trading businesses from two sites. This ostensibly involved buying vehicles for scrap and spare parts, but, in fact, at least so it was alleged, in part repairing them and then re-registering them for use on the road.
4. Mr Franklin apparently left the United Kingdom in around October 2001. The police searched his premises, one of which had been, in the interim, subject to an arson attack. The police recovered a transit van and certain other vehicles in the course of their investigations. In due course, some of the vehicles were released to certain individuals claiming ownership. These included at least two Vauxhall Corsas and an Audi which the second Defendant, that is to say Mr Hunt, had claimed were his. He had produced the keys for them.
5. At the outset of the trial, there was some dispute as to precisely the number of vehicles in respect of which Mr Franklin was making allegations and claims against Mr Hunt. The judge took the view that on the papers he was raising a claim in respect of, at most, three cars; and perhaps only one of the Corsas and an Audi.
6. Mr Franklin sought to persuade the judge that, in fact, as far as Mr Hunt was concerned, six cars were involved. Indeed, he has today referred us to a pre-action protocol letter and other documents which might suggest that was indeed his claim. However, the judge took the view that that had not been properly particularised in the pleadings and refused leave to amend in that regard. The trial thus proceeded.
7. It may be added that having returned to the United Kingdom, Mr Franklin was arrested and, in due course, charged with the murder of these two men. He was convicted in March 2003 and is currently serving a life sentence.
8. The proceedings which Mr Franklin in due course instituted in the County Court were commenced in 2007. One set of proceedings was against the police for allowing the loss and destruction of the transit van; the second against the police was for loss of vehicles by theft or otherwise when the yards were said to be under their control; and the third was the against the second Defendant, Mr Hunt, for the wrongful taking of at least the three cars, although, as I have indicated, Mr Franklin says he was making a complaint with regard to six cars.
9. In due course, Mr Hunt himself, for much of the time acting in person, counterclaimed for substantial sums, but those counterclaims were clearly time barred and, in short order, failed for that very reason.
10. At the trial, Mr Franklin appeared in person. The first Defendant, the Chief Constable, was legally represented. By this stage Mr Hunt, also was legally represented.
11. As the judgment makes clear, the judge accepted the evidence of Mr Hunt. It may be added that Mr Hunt himself has criminal convictions against his name and credibility was very much in issue. The judge found that Mr Hunt had been essentially truthful in his evidence and any inconsistencies in it were to be explained by the lapse of time. She thus did not accept Mr Franklin's own evidence in the relevant respects. The judge concluded that Mr Hunt was indeed to be regarded as against Mr Franklin as the owner of the vehicles in question. She further found that the claims made against the police in respect of these particular vehicles also failed.
12. The judge's approach is really summarised in certain paragraphs of her careful and lengthy judgment. Thus in paragraph 31 she says this:

"Accordingly, I have concluded on the balance of probabilities that the second Defendant was the de facto owner of the vehicles which are the subject to the claim against him. I find on the balance of probabilities that the second Defendant had made cash payments to the Claimant for those vehicles and for the red Corsa that he recovered from the Brook Farm premises. Accordingly, I find that when he recovered those vehicles from the Claimant's premises, he had legal title to do so."

13. The judge's conclusions were further repeated in paragraphs 34 and 35 of her judgment. At the very end of her judgment handed down at paragraph 599 she said this:

"I have not yet heard the parties arguments about costs. Given the Claimant's claim against both Defendants, prima facie I am of the view that the second Defendant should be entitled to recover his costs from the Claimant."

14. Nothing in those particular remarks in the judgment indicated that the judge had it in mind that she might be proposing to award costs on an indemnity basis, but there was a hearing conducted when the judgment was handed down. A file note was prepared by the first Defendant's solicitors of that hearing which we understand was conducted over the telephone. There is no reason to think that that file note is inaccurate.
15. It records that Mr Hunt's advocate had asked for costs on an indemnity basis. The judge indicated in the course of dealing with that application that she took the view that Mr Franklin's claim against Mr Hunt had been "wholly without merit". She indicated that in reaching that conclusion she had taken into account Mr Franklin's own complaints regarding non-disclosure and failure to comply with pre-action protocol letters and the like, but as the judge said:

"That did not really take matters further because the Claimant's claim had no merit."

16. The judge also was, to some extent, critical of Mr Franklin for seeking to reopen his claim at the outset of the trial with regard to the further vehicles as I have mentioned. The order of the judge as finally drawn up confirmed that the claim against Mr Hunt was dismissed as being totally without merit.
17. Mr Franklin today has complained about the judge ordering costs on an indemnity basis. Clearly the judge was entitled to make an award of costs in favour of Mr Hunt. Mr Hunt had succeeded at trial. Mr Franklin says that, however, there was no proper basis for making the award on the indemnity basis. In this respect, Mr Franklin raised two particular arguments.
18. First, he sought to say that his claim had indeed been about six cars, not just two or even three cars and the judge had not properly allowed for that. I do not think that argument can assist Mr Franklin. The judge had refused leave to amend with regard to the extra cars and I do not think that can be reopened now. In any event, as Elias LJ pointed out at the last hearing, it is quite plain from the judge's treatment of the evidence that she would have rejected that claim in any event just because she had accepted Mr Hunt's evidence.
19. The second point raised by Mr Franklin is that the judge in awarding indemnity costs had not had proper account of the fact that Mr Hunt had failed to give proper disclosure or comply with protocols and the like. I can see the point if that were so, but the trouble is that the judge clearly and expressly had regard to it. Her ultimate view nevertheless was that this was a claim which was totally without merit.
20. In my view, the question of costs was a matter for the judge's discretion. She had had the conduct of the trial. She had seen and heard the witnesses give evidence. In my view, it was well within the proper range of exercise of discretion for her to conclude that Mr Franklin should be ordered to pay costs on an indemnity basis. I think she was entitled to reach that conclusion. The arguments Mr Franklin has sought to raise before us today do not displace that.
21. I should add that it was said at least in the court below by Mr Franklin that there was no practical possibility of any order for costs being enforced against him just because he is serving a life sentence. Mr Hunt, appearing before us today, acknowledges, I think, the realities and, at all events, has told us that thus far he has not sought to enforce the order. But whether or not Mr Franklin may be in a position to pay the costs is not determinative. What matters is whether Mr Hunt was at least entitled to an order for costs in his favour. I think that he was. I further think the judge's discretion to award indemnity costs cannot, for the reasons I have sought to give, be successfully challenged now.
22. I would only desire to add that Mr Franklin has addressed us today not only concisely, but with complete courtesy and politeness. His arguments were put before us very well indeed. Notwithstanding that, I would for my part dismiss this appeal.
23. LORD JUSTICE TOMLINSONI agree. There is insufficient material before us which would justify us in overturning the judge's exercise of her discretion in relation to costs, a discretion which she exercised having regard to her in depth knowledge of the circumstances in which the claim was brought; a view which she had formed after exposure to the parties and her conduct of the trial. I too would dismiss the appeal.