England and Wales Court of Appeal (Civil Division) Decisions

IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM CENTRAL LONDON COUNTY COURT
(HIS HONOUR JUDGE DIGHT)

		Royal Courts of Justice Strand London, WC2A 2LL
		24th June 2015

1. LORD JUSTICE BRIGGS: This is a renewed oral application for permission to appeal the order of His Honour Judge Dight made in the Central London County Court on 28th May 2014 for possession of a property known as 2 Collinwood Gardens, Ilford, Essex, against the defendants on the grounds that they had sold the property to the claimant and been paid in full for it but had failed to vacate. The defendants said that the transfer by way of sale had been forged, that they had not signed it, or that if they had, they relied on non est factum, having been tricked, but not by the claimant, into thinking that the transaction was merely a re-mortgage. The judge found that they had signed the transfer and that they intended thereby to sell the property so that their defence failed.
2. The gist of the appeal is that the judge's rejection of their case of forgery was based upon a series of errors of approach, upon the procedurally wrong rejection of certain relevant evidence and the wrong preference of the evidence of a solicitor who said that he had witnessed their signatures, over both their own evidence and compelling evidence from a jointly instructed expert in document examination which concluded that the evidence of forgery was strong.
3. Most unusually, the written reasons why this application was rejected on the papers by Kitchin LJ on 26th January 2015 are set out very fully in a form which provides a fully sufficient explanation of the background, which I would merely be repeating if I set it out again. I shall therefore take it as read.
4. The question I have to decide is whether the oral submissions of Mr Spanier for the appellants, and having also listened to some brief and concise submissions of Mr Timothy Hammond who attended for the respondent, lead me to a different conclusion than was reached by Kitchin LJ, namely that the appellants have a real, rather than as Kitchin LJ thought merely fanciful, prospect of upsetting the essentially factual conclusions of an experienced judge set out in a full and careful judgment after hearing the relevant witnesses and thoroughly reviewing a body of documents during the course of a lengthy trial.
5. Findings of this type will not, generally speaking, be overturned unless, after crediting the trial judge with the large advantages available to him, the appellate court is satisfied that he was clearly wrong or unless procedural errors mean that justice requires a re-trial. Nonetheless, the test for giving permission to appeal is only whether the appellant has a real prospect of succeeding on appeal, and that merely means a more than fanciful prospect of succeeding, or whether there is some other compelling reason for giving permission to appeal. The present case has been argued entirely on the basis of the alleged existence of a real prospect of success.
6. Boiling down the numerous grounds and sub-grounds of appeal to their essentials, the main and strongest points in the challenge to judge's findings are these -- and I am here reciting the submissions rather than expressing any conclusion about them --

(a) The judge's reasons for rejecting the evidence of the single joint expert that the contract which proceeded the transfer was forged was perverse. He held that although there was a precise pencil tracing of both signatures under the ink signatures, it was not shown who had done the tracing so that it was a non sequitur to say that it showed that the pen signatures were forged.

(b) The judge wrongly reached an unshakable view about the reliability of the evidence of a solicitor who witnessed the signing of the transfer, which caused him to reject the expert evidence without either a sufficient reason for doing so or a weighing of all the relevant evidence about reliability as between the expert and the non-expert evidence.

(c) The judge failed to give due weight to what might be described as similar fact evidence about other aspects of the way in which the defendants had been tricked by the fraud certificates, such as the forgery of the contract for the sale of the property, which was not itself witnessed, forgery of an associated tenancy agreement, forged instructions to agents called Haart, forgery of an earlier purported contract for a sale to a Mr Patel, the use by the fraudsters of false addresses and mobile phone numbers to enable them to impersonate the defendants in relevant dealings and to intercept relevant communications about the transaction, and a related fraudulent purported purchase of a neighbouring property on Woodford Avenue.

(d) The judge wrongly rejected late evidence about some of those matters, wrongly regarding them as peripheral, whereas they formed an important part of the story about a sophisticated fraud upon, among others, the appellants.

7. Mr Spanier's helpful oral submissions were on the first and second of those two grounds, which I have identified as (a) and (b). Having found this to be a difficult case in which to decide whether or not to give permission, I permitted Mr Spanier considerably more than the usual half hour accorded on these applications, and indeed unusually heard also from Mr Hammond, and I am grateful to both counsel.
8. Taking point (a) first, namely the judge's reasons for rejecting the evidence that the contract was forged was perverse, it is convenient to start by reading paragraph 62 of the judgment, from which the relevant criticism emerges. He says:

"It seems to me however that the purely scientific part of the report [he is there referring to the report of the single joint expert] is, as I have said, the finding of pencil-marks underneath the contract signatures. The rest of the report is opinion. The pencil-marks are confined to the contract. The conclusion drawn by the expert in respect of the signatures on the contract is that the tracing over of the pencil-marks means that the signatures are not genuine but that conclusion is itself only an inference which may or may not be correct. There is no evidence which she can produce [he is there referring, I think, to the expert] as to who did the tracing. Her assumption, albeit unspoken, is that the original pencil marks were not put on the document by the defendants who were not in fact asked about it. It does not follow from any of that therefore that the signature on the TR1 [that is the transfer] is not theirs. The reasoning of the expert, in my judgment, contains a fallacy and moreover it seems contrary to the weight of all the other evidence."

9. While that paragraph may be said to be mainly about the ultimately important question, namely whether the transfer is forged, it is clear I think from paragraph 68 and 69 of the judgment that the judge regarded the question whether the contract was forged as really part and parcel of the same question: either they were both forged or neither of them was.
10. There was no third party evidence about the execution of the contract, in sharp contrast with the transfer, and the judge appears to have concluded that the alleged forgery of the contract should be assessed together with forgery of the transfer on the footing that if the transfer was genuine, so therefore probably was the contract.
11. There is nothing wrong with that holistic approach, but it is at least arguable that the sword cuts both ways. Thus if the contract was clearly forged, then arguably so was the transfer probably forged. Mr Spanier said that there was no suggestion put to the defendants that they, or anyone on their instructions, put the pencil tracing on the contract, and indeed no finding by the judge to that effect, so that the only explanation was that the tracing was, as the experts said, part of a forgery of the defendants' signatures, and Mr Spanier submitted that a contrary conclusion was perverse.
12. In my judgment, although it is not one I found at all easy, this ground does just pass the test for permission to appeal. More generally, it is arguable that, in addressing the all important question about the forgery of the transfer, a strong case for concluding that the contract was forged was not really addressed by the judge in a convincing way. Even if it is possible that the contract was forged but that the transfer was not forged, this outcome, which again the judge understandably did not address in the light of his factual findings, might arguably undermine the judge's negative conclusion about the non est factum defence.
13. Taking next the ground which I have identified as ground (b), an alleged failure to weigh all the evidence, I accept that it is possible to read the judgment as depicting a process in which the judge first decided that the solicitor's evidence was reliable and then rejected the contrary expert evidence as a result without weighing each against the other, but it is a mistake to assume that, because a judge necessarily has to set out his reasons in some coherent and sequential order, that his thought process in making up his mind precisely mirrored that order. It would be a mistake to do so in this case. Furthermore, a judge is not required to deal with every submission put to him about the reliability or otherwise of evidence, even when weighing expert evidence against non-expert evidence pointing the other way.
14. The judge made it clear that, in reaching his negative conclusion about forgery of the transfer, he had indeed weighed in the balance all the relevant evidence and the factors pointing each way. Thus, he made findings about the serious unreliability of the appellant's own evidence with detailed examples and reasons for doing so. He gave detailed consideration to the joint expert's conclusions, carefully distinguishing between those which were scientifically based and those which are matters of opinion about which the court could and should form its own view, in the course of which he identified and explained what he regarded as the non sequitur in the expert's evidence to which I have referred. He also gave a fair account of matters relevant to the credibility of the solicitor's evidence, weighing in particular his reluctance to testify about a client identification exercise, about which he probably anticipated criticism due to failure to take copies of the passports presented by the appellants for identification purposes at the appropriate time.
15. It is of course a strong thing for a trial judge to reject the opinion of a single joint expert, not least where the opinion is as firmly given as it was in the present case. The expert was not called for cross-examination, but she was subjected to a process of written questioning by the claimant's solicitors, her answers to which the judge carefully analysed. There was equally compelling evidence that the appellants had signed the transfer. This was not a case in which they said they had never attended the solicitor and his signature on it as a witness was not challenged.
16. Thus, I would not have regarded this ground on its own as a sufficient ground for giving permission to appeal, but since it is so closely connected with the issue of perversity, I am not minded to exclude argument under it at the full appeal.
17. Next, other aspects of the fraud, what I called in my earlier summary "similar fact evidence". The judge was careful to keep his analysis focused upon the key issues, contrary to what he regarded the parties as having done during trial. He was, in principle, entitled to distinguish between issues relevant to the central dispute about the validity of the transfer and issues which he characterised as red herrings. It by no means follows that because the appellants were defrauded of the proceeds of sale, because there was a fraud in relation to Woodford Avenue or because the fraudsters cut corners in relation to instructing the solicitors for a sale and even forging the contract, that therefore the appellants did not intend to sell the property by executing the transfer. The evidence was strong that they did instruct agents to market the property, that they did sign the transfer and received the net proceeds after redeeming the mortgage and a case of non est factum was, on its face, not a strong one; indeed, the judge said he was in no doubt that they intended to sell the property. But I am just persuaded that this ground also deserves consideration on a full appeal. While these other matters, viewed separately, may look like red herrings and not be decisive of the question whether this fraud went beyond theft of the net proceeds of sale so as to include forgery of a transfer when the defendants never intended to do more than remortgage, it is arguable that, taken as a whole, they are of greater relevance to that question than the judge allowed in his understandable desire to separate the wheat from the chaff.
18. Finally, rejecting relevant evidence, as Kitchin LJ said the judge's decisions to refused to admit late evidence were discretionary case management matters for him, in the absence of a clear error or injustice. Justice in this context includes fairness to the claimant, a wholly innocent purchaser not accused of carelessness, still less complicity in the fraud, for whom the introduction of very late evidence about matters not within its own knowledge was prima facie unfair. The judge was entitled to take a view about the relative lack of centrality of the material which he rejected. In those circumstances I am not minded to give permission to appeal on that ground.
19. I have also considered, bearing in mind that the amended grounds of appeal run to 15 sections, some in considerable detail, whether I should refuse permission to appeal on more of them than the rejection of evidence ground that I have just identified, if only to keep the length and expense of the appeal within proportionate bounds, but most of them overlap and I have not been persuaded, apart from the issue as to the rejection of evidence at trial, that significant savings would be achieved by attempting at this summary stage to exclude one or more of them, even though on their own they would probably not have been sufficient for permission to appeal.
20. I therefore propose to grant permission to appeal on all grounds except grounds 4 and 6, to extend the current stay of the possession order until the conclusion of the full appeal, and I must now deal briefly with an application made at the beginning of this morning's hearing by Mr Spanier to amend his grounds of appeal and introduce fresh evidence.
21. This application was made on the footing that after having failed at trial, the defendants having then instructed private investigators, that is needless to say now over a year ago, on 17th June this year those private investigators provided new documentation which was submitted to the police and the defendants received an indication from the police on 22nd June that they would be paying serious attention to a large bundle of documents which included both them and the trial bundles. Mr Spanier was unable, understandably in the circumstances, to formulate any new ground of appeal because, as he frankly admitted, he did not know at this stage what those documents might after further investigation reveal, and it appeared that the only persons likely to be conducting that investigation would be the police rather than his clients. Accordingly, he was unable to identify any fresh evidence that he wished at this stage to adduce, he was unable to identify what any new ground of appeal would be, and still less was he able to identify why any such fresh evidence might satisfy the Ladd v Marshall grounds, save only that they were not reasonably available to his clients at trial. Whether that is so also seems to me a matter for question, bearing in mind that there is no evidence before the court as to why the instruction of the private investigators awaited the trial, rather than formed part of the preparation for the trial. His invitation to me was to admit the application in principle but adjourn it until an unspecified date in the future when it might be able to be made with proper material and proper focus.
22. I am not minded to do any such thing. It seems to me that if -- and that seems to me to be an entirely speculative question -- further relevant material emerges at some later stage, then Mr Spanier's clients will have to consider at that stage whether to make an application to admit it and whether the requirements of the rules, which now broadly reflect Ladd v Marshall, are sufficiently satisfied to give that application a prospect of success. So I will say no more about it than that at present.