England and Wales Court of Appeal (Civil Division) Decisions

IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE COUNTY COURT AT CENTRAL LONDON
HH JUDGE FABER
CASE B10CL476

		Royal Courts of Justice Strand, London, WC2A 2LL
		27/03/2018

Mrs Justice Rose:

Introduction

1. This claim was brought by the Claimant, Mr Constandas, against the First Respondent, his sister Mrs Lysandrou, the Second Respondent his brother-in-law, Mr Lysandrou and the Third Respondent his nephew Michael Lysandrou. The claim concerns the beneficial ownership of the house in Mackeson Road, London NW3 in which all the parties lived for many years. Since 2007 the legal title to the house has been vested in Mr and Mrs Lysandrou. Mr Constandas claimed that he was entitled to a half share in the house on the grounds that when it was bought in 1959 he paid a deposit of £100 and a further £500 as a down payment. That comprised half the purchase price of £1,200, the other half being funded by a mortgage taken out in the sole name of Mrs Lysandrou.
2. The claim was brought under the Trusts of Land and Appointment of Trustees Act 1996 for a declaration regarding Mr Constandas' right of ownership of and occupation at the property and for an injunction and damages for unlawful eviction and trespass. It was common ground at the trial that the claim was based on a resulting trust said to arise in accordance with the principles established by the House of Lords in Stack v Dowden [2007] UKHL 17, [2007] 2 AC 432. It was agreed that there was a presumption that the beneficial ownership of a property was the same as the legal ownership. The case turned on whether Mr Constandas could show that he had contributed the down payment of £600 in June 1959 when the house was bought. The Respondents denied that Mr Constandas had made any such contribution to the purchase price or that he was entitled for any other reason to an interest in the house.
3. The trial took place before HHJ Faber on 27 and 28 October 2015. Any investigation into the source of money used to buy a house in 1959 was always likely to be challenging. The additional difficulty arose from the fact that Mr Constandas was 86 at the time of the trial and Mr and Mrs Lysandrou were also in their 80s. Mr Constandas gave evidence at the trial as did his solicitor Mr Sharp. Unfortunately both Mr and Mrs Lysandrou suffer from dementia and could not give evidence. Evidence for the Respondents resisting Mr Constandas' claim was given by Michael Lysandrou, by a tenant in the property Mr Newsham and by Avghi Constandas, Mr Constandas' former wife.
4. The evidence in the trial concluded over the two days of court time that had been allotted to it. At the end of the trial it was expected that there would be a further hearing where more evidence and closing submissions would be dealt with. In fact the parties agreed that there should be no further evidence and the closing submissions should be in writing. Those submissions had been served by February 2016. For reasons which were nobody's fault, handing down of judgment was delayed until 7 September 2016. In her judgment HHJ Faber concluded that on the evidence available to her she could not arrive at any findings as to who had paid the £600 down payment in 1959. She therefore held that Mr Constandas had not discharged the burden of proof that lay upon him as the claimant in the proceedings. She therefore dismissed the claim, other than awarding Mr Constandas a small amount of money in respect of damage caused to his property by the Respondents. However, although the Respondent successfully resisted the claim, the Judge made no order as to costs because she disapproved strongly of the conduct of Michael Lysandrou as I describe later.
5. Mr Constandas appeals against the dismissal of his claim with the permission of Henderson LJ. He argues that the Judge was wrong to fall back on the burden of proof to dispose of the case and that she did not apply the correct test as laid down in the authorities. The Respondents also with the permission of Henderson LJ appeal against the Judge's decision not to award them their costs.

The main appeal

6. In her judgment, HHJ Faber first set out those facts which were not controversial. Mr Constandas came to the United Kingdom from Cyprus in 1951. He acquired a property in Agincourt Road nearby the Mackeson Road house in 1954 and lived there with his wife and the Respondents for about four years. In 1959 the house in Mackeson Road was acquired and registered in the sole name of Mrs Lysandrou. Mrs Lysandrou moved in there with her husband and her parents and Michael Lysandrou, who was born in 1957, lived there with them.
7. In 1973 Mr Constandas' marriage broke down and he also moved into the house and has lived there ever since. In about 2007 the house was transferred into the names of Mr and Mrs Lysandrou. The Judge noted at [9] that the parties were agreed that Mr Constandas had paid nothing towards the mortgage on the property and nothing towards its upkeep over the years.
8. By 2015 Mrs Lysandrou was suffering from dementia. Michael Lysandrou was granted power of attorney in respect of her welfare and financial affairs at the beginning of that year. In June 2015 Michael Lysandrou acting under that power of attorney served notice to quit on Mr Constandas. In July 2015 the Respondents evicted Mr Constandas from the house and refused to allow him to re-enter. On 28 July 2015 Mr Constandas issued this claim and made an urgent application for injunctive relief to reinstate him in the property pending trial. On 6 August 2015 that injunction application was granted by DJ Langley who also gave directions for an expedited trial.
9. Having set out those facts, HHJ Faber then reviewed the documentary evidence before her to see whether or not it assisted her in determining the case. She examined the incomings and outgoings between 1955 and 1959 in the following accounts:

i) a post office account and a Bank of Cyprus account belonging to Mrs Lysandrou;

ii) a post office account and a Bank of Cyprus account belonging to Mr Lysandrou;

iii) a Bank of Cyprus account belonging to Mr Constandas.

10. The most significant information derived from that analysis for the purposes of the issues before her was as follows:

i) £500 was withdrawn by crossed warrant by Mrs Lysandrou from her post office account on 17 May 1957;

ii) there had been no transactions in Mr Lysandrou's Bank of Cyprus account in 1959 before October (that is after the house was acquired);

iii) in January 1959 Mrs Lysandrou withdrew £280 from her Bank of Cyprus account leaving a balance of about £108;

iv) in February 1959 there was a payment into Mrs Lysandrou's Bank of Cyprus account of £1,290 with reference to Elena Aroti who was Mr Constandas' mother-in-law and a payment out of the same amount in June 1959 to Mr Constandas' wife;

v) on 12 May 1959 Mr Constandas had paid out £645 from his Bank of Cyprus account to Elena Aroti;

vi) on 19 May 1959, that is shortly before the purchase of the house, Mr Constandas received into his Bank of Cyprus account £643 from Mrs Aroti in Cyprus.

11. The Judge also noted in her chronology of events that an attendance note dated 21 July 2015 recorded that Michael Lysandrou had said he remembered his parents telling him that they had bought the property with money from his grandfather, that is to say the father of Mr Constandas and Mrs Lysandrou.
12. The Judge then went on to make her findings on the two key issues; first whether there was evidence to show that either or both of Mr Constandas and Mr and Mrs Lysandrou had had the money available to them in June 1959 to make the down payment of £600 and secondly whether there was evidence to show that, if they had had that money available, they had in fact used that money to make the down payment.
13. She was satisfied that Mr Constandas had £643 in his Bank of Cyprus account in London as from 19 May 1959. However, there was no evidence of a withdrawal of that money to be used as the down payment because the London branch of the Bank had no record at all of Mr Constandas. She took the view that the lack of a record of withdrawal did not undermine his case. The Judge concluded that neither Mr or Mrs Lysandrou had sufficient cash in their respective accounts in May or June 1959 to pay £600. However, over the previous two years they had made a series of withdrawals from their bank accounts amounting to £924. That sum included the crossed warrant for £500. There was a dispute between the parties as to whether that was equivalent to cash or whether the warrant would have been made out to a third party payee in which case it would not have been available to pay for the house.
14. The Judge then considered whether the £600 could have been funded by Mrs Lysandrou by putting aside money out of her weekly earnings as a seamstress after she arrived in this country 1954. This was the explanation put forward in Mrs Lysandrou's witness statement and Mr Lysandrou had said the same thing. The Judge noted that these witness statements were made some considerable time after Mrs Lysandrou's dementia had become advanced. Further, as Mr and Mrs Lysandrou had not been able to give oral evidence confirming their witness statements, their witness statements were hearsay. The Judge set out the evidence given by Mr Constandas when he was cross-examined on what he remembered about Mrs Lysandrou's earnings. Mr Constandas accepted when it was put to him that his sister had worked for three or four months as a machinist making swimsuits earning possibly £4.50 a week. She had then worked for a company called Susan Small for a time, earning more there than she had previously earned. He did not agree that she had earned as much as £9 per week. He also did not accept that Mrs Lysandrou had worked throughout 1957 and 1958 because he recalled that she had stopped work when she became pregnant with Michael. The Judge calculated that Mrs Lysandrou would have earned about £1,022 before Michael was born.
15. The Judge then considered the evidence from Michael Lysandrou about what he had been told over the years about who had bought the house. He said he recalled his grandfather saying that he had provided the money for the house but that his mother had told him that the grandfather was "telling stories". His evidence was therefore very ambivalent as to whether he was saying that the grandfather had paid for the house even though his mother had suggested that that was not true. The Judge concluded at [13] that Michael Lysandrou was not clear about who paid and that, as she put it: " … there is not much help in the three Defendants' evidence as to who paid the £600 or perhaps £500 down payment".
16. Judge Faber then turned to consider whether she could accept Mr Constandas' evidence that he had used the £643 undoubtedly in his Bank of Cyprus account to fund the down payment. She dealt with various matters that went to his credibility:

i) Mr Constandas' evidence that he was wholly responsible for finding the property and conducting the purchase had been undermined by the fact that the Land Registry documents showed that Mr and Mrs Lysandrou had carried out the searches on the house in 1959.

ii) There had been a dispute between the parties as to when Mr Constandas had first claimed ownership of part of the house. Mr Constandas' case was that he had begun to assert his entitlement to a share of the house in 2014 and that that was what triggered Michael Lysandrou's decision to evict him from the house. The Respondents' case was that the decision to evict him was triggered by Mr Constandas carrying out a serious assault on his sister and that it was only after notice to quit had been served that he first asserted his ownership. On this point the Judge accepted Mr Constandas' evidence and rejected the evidence of an assault.

iii) Mr Constandas had given inconsistent evidence to a District Judge during matrimonial proceedings in April 2003 as regards who had bought the Agincourt Road house. He had given evidence then that his father had paid for that house. In the present case he had refuted the Respondents' assertion that his father had helped Mrs Lysandrou pay for the house by saying that his father would not have had the money to do so. The Judge found that that was evidence of Mr Constandas' unreliability as a witness.

iv) Further Mr Constandas had said in his first witness statement that he contributed to bills and expenses for the Mackeson Road house whereas at trial he accepted that that was not correct. The Judge again considered that was also evidence of unreliability on his part because it was highly relevant to the issues in the case.

v) The Judge found that Mr Constandas did not tell the court in his divorce proceedings in the 1970s that he was part owner of the Mackeson Road house even though he was obliged to disclose his assets. She acknowledged that he had no solicitors to advise him during those proceedings, but she noted that in cross-examination Mr Constandas had said that the reason why he went to live in Mackeson Road after his divorce was because "Lawyers told me to go there as I had nowhere to go". The Judge thought this was a telling piece of evidence; Mr Constandas did not say that the lawyers had told him to go there because he owned the house or had a share in it. She considered that this indicated that he had not told anybody at that time about his alleged ownership of the house.

17. Having considered these items of evidence the Judge concluded at [21]:

"21. The Claimant has not shown himself to be sufficiently reliable as a witness to establish on the balance of probabilities that he did pay that money from his Bank of Cyprus account to buy 28 Mackeson Road. The Defendants are not reliable witnesses either so I cannot make any findings as to who paid the down payment. It might have been the first Defendant from her earnings and she may have been assisted by money sent from Cyprus by relatives."

18. She went on to award Mr Constandas £250 in respect of damages for conversion of his property left in the house after his eviction and held that save for that element, the claim would be dismissed and judgment given for the Defendants.
19. Mr Constandas' first ground of appeal is that the Judge was wrong to rely on the burden of proof to dispose of the central finding of fact, namely whether Mr Constandas had paid the £600 down payment on the house. Ms Steinhardt appearing for Mr Constandas before us accepts that Mr Constandas bears the burden of showing that he has a beneficial interest and that the beneficial ownership of the house is therefore different from the legal ownership. But she maintains that the Judge was wrong to dispose of the case on the basis that she could not make a finding one way or the other. Ms Steinhardt argues in the alternative on this first ground that the Judge applied a heightened standard of proof and failed to weigh the competing theories fairly one against the other.
20. Mr Constandas' second ground of appeal is closely linked to the first and asserts that the Judge adopted an erroneous approach to the evidence. Ms Steinhardt submits that the only permissible conclusion on a proper analysis of the evidence was that Mr Constandas had established his case. Ms Steinhardt was a little hesitant in asking the court to remake the decision in Mr Constandas' favour. Her primary case if her first ground of appeal succeeds is that the court should set aside HHJ Faber's order and remit the matter to the County Court for a fresh trial. If Mr Constandas is successful on the second ground, the correct course would be for the court to determine the issue in Mr Constandas' favour and make an order to that effect.
21. Mr Jacobs for the Respondents argues that the Judge was right to conclude that there was not enough evidence for her to be satisfied on the balance of probabilities that Mr Constandas had made the down payment. She was entitled to decide that she could not rely on his oral evidence because of his previous inconsistent and untruthful evidence about the funding of the purchase. If she rejected Mr Constandas' evidence that he had used the £643 in his bank account to make the payment, there was nothing else Mr Constandas could rely on to show that he had made the payment.
22. The circumstances in which a court is entitled to determine a disputed issue of fact by resort to the burden of proof were discussed in Stephens v Cannon [2005] EWCA Civ 222, [2005] CP Rep 31. That case concerned a dispute over the sale of a piece of land. One issue in the case was the rival evidence as to the price for which the property would have been sold at a particular time. The Master had adopted the valuation put forward by the buyer's expert Mr Harvey, a chartered surveyor. The sellers submitted that the Master was wrong to adopt Mr Harvey's figure as the likely sale price. The Master said that he was confronted with the expert evidence of two professional surveyors who had presented valuation ranges which were some way apart. He was unable to decide that he preferred one view over the other and the case therefore fell to be decided on the basis of the burden of proof. As the sellers bore the burden of proof to satisfy him on the balance of probabilities that their view was correct and they had failed to do this he adopted the view put forward by the buyers. The sellers complained that the Master had abdicated his judicial responsibility by failing to reach a conclusion in the light of the evidence of the two experts as to the price which would have been achieved upon sale.
23. After referring to the relevant authorities, Wilson J, with whom Arden and Auld LJJ agreed, set out the following propositions ([46]):

"(a) The situation in which the court finds itself before it can despatch a disputed issue by resort to the burden of proof has to be exceptional.

(b) Nevertheless the issue does not have to be of any particular type. A legitimate state of agnosticism can logically arise following enquiry into any type of disputed issue. It may be more likely to arise following an enquiry into, for example, the identity of the aggressor in an unwitnessed fight; but it can arise even after an enquiry, aided by good experts, into, for example, the cause of the sinking of a ship.

(c) The exceptional situation which entitles the court to resort to the burden of proof is that, notwithstanding that it has striven to do so, it cannot reasonably make a finding in relation to a disputed issue.

(d) A court which resorts to the burden of proof must ensure that others can discern that it has striven to make a finding in relation to a disputed issue and can understand the reasons why it has concluded that it cannot do so. The parties must be able to discern the court's endeavour and to understand its reasons in order to be able to perceive why they have won and lost. An appellate court must also be able to do so because otherwise it will not be able to accept that the court below was in the exceptional situation of being entitled to resort to the burden of proof.

(e) In a few cases the fact of the endeavour and the reasons for the conclusion will readily be inferred from the circumstances and so there will be no need for the court to demonstrate the endeavour and to explain the reasons in any detail in its judgment. In most cases, however, a more detailed demonstration and explanation in [a] judgment will be necessary."

24. The Court of Appeal held that the Master's decision could not stand, despite having considerable sympathy for him confronting the task of valuation. The Master had not sufficiently striven to come to a decision or explained why he could not reasonably do so. An allied concern was that he seemed to regard himself as required to adopt one or other of the experts' figures whereas it had been open to him to adopt an intermediate figure in a principled way. He had not therefore been entitled to resort to the burden of proof in the manner in which he did.
25. The principles set out in Stephens v Cannon were refined in Verlander v Devon Waste Management & Anr [2007] EWCA Civ 835 (unreported). The factual dispute in that case was how an employee came by an injury to his back when loading an industrial freezer onto the trailer of a lorry. He claimed that he had been required to lift the freezer to a height of about four to five feet to stack it onto refrigerators already loaded onto the lorry. The defendants claimed that he had only been required to lift the freezer a few inches so that although he had suffered the back injury claimed, there was no unsafe system of work. The Recorder at trial found the claimant to be an unimpressive witness who had been evasive and some of whose evidence had been contradictory. On the other hand he detected some closing of ranks and obfuscation on the part of the defence witnesses. The Recorder said he was unable to find that the claimant had proved his case and dismissed the claim. The Court of Appeal unanimously dismissed the appeal. Having cited the passage from Stephens v Cannon that I have set out earlier, Auld LJ reduced the analysis to two main propositions:

"19. …First, a judge should only resort to the burden of proof where he is unable to resolve an issue of fact or facts after he has unsuccessfully attempted to do so by examination and evaluation of the evidence. Secondly, the Court of Appeal should only intervene where the nature of the case and/or the judge's reasoning are such that he could reasonably have been able to make a finding one way or the other on the evidence without such resort.

…

24. When this court in Stephens v Cannon used the word "exceptional" as a seeming qualification for resort by a tribunal to the burden of proof, it meant no more than that such resort is only necessary where on the available evidence, conflicting and/or uncertain and/or falling short of proof, there is nothing left but to conclude that the claimant has not proved his case. The burden of proof remains part of our law and practice -- and a respectable and useful part at that -- where a tribunal cannot on the state of the evidence before it rationally decide one way or the other. In this case the Recorder has shown, in my view, in his general observations on the unsatisfactory nature of the important parts of the evidence on each side going to the central issue, particularly that of Mr Verlander, that he had considered carefully whether there was evidence on which he could rationally decide one way or the other."

26. More recently the issue of reliance on the burden of proof to resolve a conflict of evidence was discussed in Barnett v Medway NHS Foundation Trust [2017] EWCA Civ 235 ('Barnett') at [55]. That case also concerned the trial judge's difficulty in deciding between the evidence of two expert witnesses. Not only was the medical evidence there particularly difficult, but the evidence of the two microbiology experts was expressed in difficult and shifting terms. The Court of Appeal accepted that the claimant's expert's evidence fell short of establishing probability. Irwin LJ with whom Hallett and Hamblen LJJ agreed held that there was some force in the appellant's criticism of a lack of reasoning in the judgment under appeal. Only the briefest explanation had been given by the judge for his conclusion and although brevity was generally to be commended, in that case it had gone too far. However, Irwin LJ had then conducted for himself the exercise of examining and evaluating the evidence before the judge and arrived at the same conclusion. It was one of those rare cases where the judge was justified in his inability to resolve an issue of fact consistent with the approach laid down in Stephens v Cannon and Verlander v Devon Waste Management.
27. Ms Steinhardt also referred to the comments of the Court of Appeal in Cooper v Floor Cleaning Machines Ltd [2002] EWCA Civ 1649, [2004] RTR 17 ('Cooper') where Scott Baker LJ and Thomas LJ said that before resorting to the burden of proof the court should raise this possibility with counsel. Thomas LJ said at [23] that in an exceptional case where a judge has in his mind that he might have to decide the case on the burden of proof, such a possibility, if not already canvassed in the course of final submissions, should be raised by the judge with the advocates before him. This might help focus the judge's views and asset the appellate court in upholding his decision. Scott Baker LJ also said at [3] that it would have been prudent to have done so since the judge might have been dissuaded from that course by one or both sides. Ms Steinhardt submitted that it was particularly unfortunate that HHJ Faber did not raise the possibility that she would be unable to make a finding of fact because the parties might not have agreed to forego the extra day's hearing for additional witnesses and because of the long period between the closing submissions and the handing down of the judgment.

Discussion

28. It is clear from the judgment that HHJ Faber did grapple fully and conscientiously with the evidence presented to her in order to decide whether she was able to make a finding that Mr Constandas had paid £600 towards the purchase of the house in June 1959. She did strive to arrive at a conclusion and she explained clearly why she was not able to do so. However, just as paucity of reasoning was not enough to justify overturning the judge's conclusion in Barnett, so the full description of the efforts that HHJ Faber made before resorting to the burden of proof is not of itself enough to enable us to conclude that she was justified in disposing of the case on that basis. The test is not whether the reasoning given adequately explains what the Judge has done, but whether what the Judge has done is in fact justified or whether she could reasonably have been able to make a finding of fact one way or the other.
29. In my judgment the Judge could not, given her assessment of the evidence before her, have reached a conclusion on whether Mr Constandas used the money for the down payment. The dilemma facing the Judge in this case was different from the dilemma facing the judges in many of the earlier cases. In Stephens v Cannon and in Cooper the problem was not a lacuna in the evidence needed to establish a particular fact but the presentation of two conflicting versions of the evidence and the difficulty of choosing between them. Choosing between conflicting factual and expert evidence is a primary judicial function and, however well matched and convincing the parties' witnesses may appear to be, the judge's task is generally to decide the case by choosing one over the other and to describe as fully as possible the factors that led to that choice: see the discussion of this judicial duty in Morris v London Iron and Steel Co Ltd [1988] 1 QB 493, 504. Here the problem facing HHJ Faber was a more fundamental problem and one which can properly be described as exceptional. Many years had elapsed since this disputed payment was made, the documentary evidence as to the provenance of the money was understandably sparse, the Respondents' direct evidence as to what had happened was not available at all because of their infirmity and Mr Constandas' direct evidence was rejected because of his lack of credibility.
30. Ms Steinhardt criticises the Judge's approach to the evidence put forward by the Respondents to show that there were other possible sources of the down payment than Mr Constandas' £643. She argues that the Judge failed to weigh up the relative likelihood of the Respondents having acquired the money and paid it compared with the version of events Mr Constandas put forward. For example, Ms Steinhardt submitted that as regards the movements of funds in and out of Mr and Mrs Lysandrou's bank accounts, these only indicated sufficient funds if one included the £500 drawn out in a crossed warrant. The parties disagreed about whether a crossed warrant was equivalent to cash or must have been made payable to some third party. The Judge refused to allow Mrs Constandas who had worked in a bank to give oral evidence about this and did not include any finding in her judgment about whether that sum could have been or had in fact been used as part of the down payment. Ms Steinhardt also submitted that the Judge had misunderstood the evidence when calculating how much money Mrs Lysandrou could have saved from her earnings because she over-estimated the period during which Mrs Lysandrou had been working and relied on average earning figures for which there was no support in the evidence.
31. Those criticisms, however, mischaracterise the task before the Judge. She was right to approach the case on the basis that it was not for the Respondents to prove that they had had the money or that they had made the payment. The burden was on Mr Constandas to show that he had made the payment. In the absence of any positive reliable evidence to show that he had done so, he was in effect inviting the court to draw an inference in his favour from the absence of any other plausible source for the funds. That would be a bold inference for the court to draw, particularly in circumstances where Mr and Mrs Lysandrou were unable to give direct evidence themselves because of their dementia. The Judge concluded that she could not rule out an alternative source for the money and so could not infer that it must have come from the £643 held in Mr Constandas' account. Given that there was no positive evidence of Mr Constandas' payment and given that she could not rule out any other source, it was inevitable that she concluded that Mr Constandas had not proved his case.
32. In her submissions on the second ground of appeal Ms Steinhardt sought to undermine the Judge's conclusion on Mr Constandas' credibility. She took each of the reasons why the Judge had formed an unfavourable view of his evidence and sought to show that it was not as pertinent as the Judge had thought. Any previous inconsistencies in Mr Constandas' evidence could be explained in a way which did not cast doubt on his evidence in these proceedings. However this court is rightly slow to second guess the trial judge's view on credibility when she has had the opportunity to see the witnesses give evidence. As Lord Hoffmann said in Biogen Inc v Medeva Ltd [1997] RPC 1, 45 the judge's findings of primary fact, particularly if founded upon an assessment of the credibility of witnesses, are virtually unassailable. Even as regards the judge's evaluation of primary facts, Lord Hoffmann went on to say:

"The need for appellate caution in reversing the judge's evaluation of the facts is based upon much more solid grounds than professional courtesy. It is because specific findings of fact, even by the most meticulous judge, are inherently an incomplete statement of the impression which was made upon him by the primary evidence. His expressed findings are always surrounded by a penumbra of imprecision as to emphasis, relative weight, minor qualification and nuance (as Renan said, la vérité est dans une nuance), of which time and language do not permit exact expression, but which may play an important part in the judge's overall evaluation."

33. For this court to arrive at a different conclusion would require the kind of "island-hopping" from one piece of evidence to another in the way which Lewison LJ cautioned against in FAGE UK Limited & anor v Chobani UK Ltd & anor [2014] EWCA Civ 5 at [114].
34. As to the point about the Judge's failure to alert counsel to the possibility that she would be unable to arrive at a conclusion on the facts, I accept that it was unfortunate that she did not have an opportunity to do so. But Ms Steinhardt rightly accepted that this is not enough for Mr Constandas to get home by itself. Ms Steinhardt was not able to point to any specific additional evidence or submission that she would have been able to make that might have led to a different outcome.
35. There is no basis for this court to interfere with the Judge's conclusion and I would dismiss Mr Constandas' appeal.

The cross appeal on costs

36. The Respondents have appealed against the Judge's decision to make no order as to costs. Following the delivery of the main judgment, there was a discussion between counsel and the Judge on consequential matters including costs and permission to appeal. The Judge then gave a short further ruling on costs ('the costs ruling'). She referred to certain findings of fact that she had made as set out in the main judgment. The first finding was the use made by the Respondents in the proceedings of documents belonging to Mr Constandas. The Judge referred at [19] of the main judgment to Mr Constandas' complaint that when he was evicted from the house, his possessions including his financial documents were put out onto the street in bin bags. Some of these documents were produced by the Respondents at the trial in an attempt to show that Mr Constandas had more financial resources available to him than he claimed when he approached the local housing authority asking for emergency accommodation to avoid being street homeless. The Judge disapproved of the fact someone had been prepared to use confidential documents against Mr Constandas and thought that that cast the conduct of the defence in a poor light.
37. The second incident of misconduct was the allegation that had been made by the Respondents that Mr Constandas had seriously assaulted Mrs Lysandrou by pushing her violently in the chest. Michael Lysandrou had described this supposed assault in detail and put it forward as the reason why Mr Constandas had been summarily evicted from the house in June 2015. The Judge found that the assault had never happened and had been fabricated by the Respondents as the reason for the eviction; the real reason for the eviction was, the Judge found, that Mr Constandas had started to assert his entitlement to an interest in the house.
38. The Judge also referred in the costs ruling to the manner in which Mr Constandas had been evicted from the house. She recognised that the eviction had been lawful, given her conclusion that Mr Constandas had failed to establish a claim to half the beneficial interest in the house. The manner of the eviction was described by Mr Constandas in his written evidence in support of an injunction to allow him back into the house. He describes how he went shopping on the morning of Saturday 20 July 2015. When he returned at lunchtime the locks to the house had been changed and all his belongings were outside in black bags. In his later witness statement Mr Constandas listed the belongings that had gone missing and concluded:

"It is extremely upsetting for me that this has happened. I am a co-owner of this house and a member of the family, yet I am being sorely used and treated like an unwelcome guest and told to go naked into the world as an 85 year old man. In bringing this claim I am trying to protect the cause of truth and my own dignity, as well as keeping myself from becoming homeless. I have nowhere else I could go and no-one I could turn to for help. I do not have any friends or relatives I could go to be with. I would be all alone and the idea is extremely upsetting to me. For the reasons I have given above, it is not true that I am a very wealthy man, as the Defendants allege. If I were made to leave the property now, my home for 43 years, I would be utterly lost."

39. The Judge may have rejected Mr Constandas' claim to part ownership of the house but she took a very dim view of the way that Michael Lysandrou had behaved towards his elderly uncle. She formed the view that he had manipulated his parents in pursuing this distressing and unnecessary litigation. She described Michael Lysandrou's conduct as manipulative, highly exceptional and reprehensible. She said in the costs ruling:

"… this is a family; Mr Constandas has lived there for 40 years. We have these elderly siblings and had Mr Michael Lysandrou been properly motivated towards his family, he could have got round the table with Mr Constandas and arranged an agreed time for leaving the premises, instead of which he did what he was legally entitled to do, but because of his approach his action resulted … in a very emotionally charged response which is hardly surprising."

40. The Judge also dealt with the submission that had been made to her that it was unfair to penalise Mr and Mrs Lysandrou for Michael Lysandrou's misconduct. She held that this was a matter for the Respondents to sort out amongst themselves and that it would not be right to distinguish between the costs incurred by Mr and Mrs Lysandrou and the costs incurred by Michael Lysandrou.
41. Mr Jacobs reminded us that CPR r 44.2 lays down the general rule that the unsuccessful party will be ordered to pay the costs of the successful party. The rule goes on to provide that the court may make a different order having regard to all the circumstances including the conduct of the parties before, as well as during the proceedings; whether it was reasonable for a party to raise and pursue a particular allegation; and the manner in which a party has defended the case. Mr Jacobs also drew our attention to the well-known dictum of Jackson LJ in Fox v Foundation Piling Ltd [2011] EWCA Civ 790, [2011] CP Rep 41, at [62] referring to the "growing and unwelcome tendency" of first instance courts to depart from the general rule that costs should follow the event too far and too often, generating huge additional costs for litigants.
42. Mr Jacobs did not assert that the Judge had erred in law in declining to make a costs order but argued rather that she had placed too much weight on the instances of Michael Lysandrou's conduct and that her refusal to order any costs recovery was disproportionate. The incidents which the Judge criticised were, Mr Jacobs argued, peripheral to the main dispute between the parties. He compared the present case with that of Sulaman v Axa Insurance plc [2009] EWCA Civ 1331, [2010] CP Rep 19 ('Sulaman') where the successful defendant was awarded only a third of her costs because the judge was satisfied that she had lied to him in two respects in her evidence at the trial. Longmore LJ with whom Aikens LJ agreed upheld the judge's decision, rejecting as misconceived the defendant's complaint that the judge had failed to calculate the time and expense taken up by the lies. Sedley LJ dissented in part as he would have allowed the defendant to recover two thirds rather than one third of her costs. Mr Jacobs argued that the approach of the Court in Sulaman shows that Judge Faber's decision to deprive the Respondents of all their costs must be disproportionate.
43. I do not see any basis for interfering with the Judge's exercise of discretion here. I do not accept that the matters of misconduct raised were peripheral. The allegation of assault was made, the Judge found, to provide a false reason for the eviction, given that the Respondents' case was that Mr Constandas had only asserted an interest in the property after he had been served with the notice to quit. Her decision to make no order as to costs was well within the range of reasonable responses to the unfortunate litigation before her. The Sulaman case is one of many where this court has stressed that the trial judge is in a much better position to assess what is the fair order as to costs than the appellate court which only dips its toe into the case for one day. The Judge was entitled to take the view that the whole litigation could have been avoided if Michael Lysandrou had behaved in a civilised manner towards the other parties. Her order was a reasonable response to that conclusion. I would therefore dismiss the cross-appeal from the costs order.

Lord Justice Kitchin:

44. I agree.