The Judicial Committee of the Privy Council Decisions

Privy Council Appeal No. 67 of 1997

 

Kemper Reinsurance Company Appellant

v.

(1) The Minister of Finance

(2) The Registrar of Companies and

(3) Electric Mutual Liability Insurance Company Ltd. Respondents

 

FROM

 

THE COURT OF APPEAL FOR BERMUDA

 

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JUDGMENT OF THE LORDS OF THE JUDICIAL

COMMITTEE OF THE PRIVY COUNCIL,

Delivered the 5th May 1998

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Present at the hearing:-

Lord Browne-Wilkinson

Lord Lloyd of Berwick

Lord Hoffmann

Lord Clyde

Lorrd Hutton

  ·[Delivered by Lord Hoffmann]

 

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1. The question in this appeal is whether the Court of Appeal of Bermuda has jurisdiction to hear an appeal from an order discharging leave to apply for an order of certiorari.  The point is a perfectly general one, unaffected by the facts of the case.  But the appellant also made a preliminary application to the Board which makes it necessary to explain the background against which the main point arises.

 

2. The appellant ("Kemper") is an Illinois reinsurance company.  It has treaties of reinsurance with Electric Mutual Liability Insurance Company ("Emlico") which is incorporated in Massachusetts.  Emlico is a subsidiary of the General Electric Company ("GE") and its business appears to be confined to insuring companies in the GE group and reinsuring those risks in the market.  The policies it has written  for  GE have given rise to very large long-tail claims for indemnity against liabilities for asbestos-related diseases and cleaning up toxic waste.  In 1994 Emlico reorganised its business by transferring its more profitable lines of insurance to a subsidiary, leaving itself only with long-tail liabilities under policies issued to GE.  It then transferred its domicile to Bermuda.  The procedure by which a foreign company may acquire a domicile (in the statutory language, "be continued") in Bermuda is governed by section 132C of the Companies Act 1981 and requires the consent of the Minister of Finance.  An applicant must provide the Minister with, among other things, proof that it has obtained "all necessary authorisations required under the laws of the country in which it was incorporated to enable it to make this application".  For this purpose, Emlico produced an order of the Massachusetts commissioner of insurance approving of the transfer of domicile.  The order was made under section 49A of Chapter 175 of the Massachusetts General Laws (Insurance), which provides that the commissioner shall approve the transfer of an insurance company's domicile to "any other state in which it is admitted to transact the business of insurance" unless she determines that this is "not in the interests of the policyholders of the commonwealth".  The Minister was duly satisfied by the commissioner's order and gave his approval.  Emlico was registered as having been continued in Bermuda and became subject to the laws of Bermuda as if it had been incorporated there.  Four months later, it petitioned for its own winding-up on the grounds of insolvency.

 

3. Kemper considers itself prejudiced by Emlico's removal to Bermuda.  It attempted unsuccessfully to intervene in the winding-up but on 26th July 1996 the usual order was made and joint liquidators appointed.  Kemper also applied ex parte to Ground J. for leave to apply for an order of certiorari to quash the consent of the Minister and the subsequent registration by the Registrar of Companies on the ground that the approval of the Massachusetts commissioner of insurance had been obtained by fraud.  The judge gave leave but Emlico, acting by its joint liquidators, applied to discharge it.  On 18th December 1996, after a lengthy inter partes hearing, Wade J. discharged the leave which Ground J. had given.  She gave leave to appeal against her order.

 

4. When Kemper attempted to appeal, Emlico raised a preliminary objection that the court had no jurisdiction to hear  appeals  from  the  grant or refusal of leave to apply for certiorari.  On 17th June 1997 the Court of Appeal upheld the objection and dismissed the appeal.  On 25th June 1997 the Court of Appeal granted leave to appeal against its jurisdictional ruling to Her Majesty in Council.  It is this appeal which is now before the Board.

 

5. Meanwhile, however, there have been developments in Massachusetts.  On 5th January 1998, in an appeal in Re Electrical Mutual Liability Insurance Company Ltd (No. 1) 426 Mass. 362 (1998), the Supreme Judicial Court of Massachusetts decided that "any other state" in section 49A of the insurance statute meant any other state of the Union and did not include Bermuda.  The grant of approval to the removal of its domicile had therefore been ultra vires and Emlico remained, by the law of Massachusetts, a domestic company.

 

6. As a result of this ruling, Lord Neill of Bladen Q.C., who represented Kemper, invited their Lordships to give a preliminary ruling on whether Emlico was a proper party to the appeal.  He said that if Emlico had not ceased to be a Massachusetts corporation, it could not have become a Bermuda corporation.  It could not therefore have been wound up under Bermuda law and the joint liquidators had no right to give instructions for its representation at the hearing of the appeal.

 

7. Their Lordships refused the application.  The fact that Emlico is a Massachusetts corporation by the law of Massachusetts is not of course inconsistent with it being a Bermuda corporation by the law of Bermuda.  Lord Neill drew their Lordships' attention to an order of the Chief Justice of Bermuda made on 9th January 1998 on an application ex parte by the joint liquidators for directions on the conduct of the winding-up.  The order declared that notwithstanding the ruling in Massachusetts, Emlico continued to be a Bermuda company and it authorised the joint liquidators to continue with the winding-up.  Lord Neill said that this order was a matter of some embarrassment to his clients because it was being used by Emlico in the American proceedings as evidence that the argument which he wished to raise by way of a preliminary point before their Lordships had already been decided against him in Bermuda.

 

 Their Lordships consider it is plain, as Miss Gloster Q.C. for the joint liquidators readily accepted, that it does nothing of the kind.  The order was properly sought by the joint liquidators for their personal protection in the courts of Bermuda in case it should later be held that Kemper was right and that the winding-up proceedings were not properly constituted.  No doubt the Chief Justice would not have made such an order unless he was at any rate provisionally of opinion that Emlico remained a Bermuda company, but the order is not binding upon any other person and the matter remains open for argument in the courts of Bermuda.  It has not so far been considered in proceedings inter partes by either of the lower courts and is not a matter which it is necessary to decide or even material for the purpose of disposing of this appeal.  Their Lordships' jurisdiction is wholly appellate and it is not their practice to decide new points of law without the benefit of the judgments in the courts below: see Pillai v. Comptroller of Income Tax [1970] AC 1124, 1130.  Lord Neill's application was therefore refused.

 

8. Their Lordships therefore turn to the single issue in the appeal, which is whether the Court of Appeal had jurisdiction to hear an appeal from the order of Wade J.  The jurisdiction of the Court of Appeal of Bermuda is entirely statutory and derives from the Court of Appeal Act 1964.  Section 12 provides as follows:-

"(1)  Subject to the provisions of subsections (2) and (3) and any Rules, any person aggrieved by a judgment of the Supreme Court in any civil cause or matter, (including matrimonial causes), whether final or interlocutory, or whether in its original or appellate jurisdiction, may appeal to the Court of Appeal; and any such appeal is hereinafter referred to as a `civil appeal'.

(2)  No appeal shall lie to the Court of Appeal -

(a)against the decision in respect of any interlocutory matter; or

(b)against an order for costs,

except with leave of the Supreme Court or the Court of Appeal.

 

9. Subsection (3) concerns matrimonial causes and is not material.  The term "judgment" in section 12(1) is defined in section 1 to include "any decree, order or decision".   This language appears prima facie wide enough to include the order of Wade J.  Insofar as her decision was interlocutory, she gave leave under section 12(2).  Nevertheless the Court of Appeal considered itself obliged to decline jurisdiction on the principle stated by the House of Lords in Lane v. Esdaile [1891] AC 210 and subsequently applied by the House to an application for judicial review in In re Poh [1983] 1 W.L.R. 2.  It is therefore necessary for their Lordships to examine these cases with some care.

 

Lane v. Esdaile [1891] AC 210 concerned the appellate jurisdiction of the House of Lords.  Originally founded upon the common law, the jurisdiction had been momentarily abolished by the Judicature Act 1873 but reinstated on a statutory basis by the Appellate Jurisdiction Act 1876, of which section 3 provided that an appeal should lie to the House of Lords from "any order or judgment of ... Her Majesty's Court of Appeal in England".  The language conferring jurisdiction was thus comparable in its breadth to section 12 of the Court of Appeal Act of Bermuda.  In Lane v. Esdaile, the order of the Court of Appeal against which it was sought to appeal was a refusal of leave to appeal under Order LVIII, r. 15 of the Rules of the Supreme Court, which had statutory force.  (The Rules had originally been scheduled to the Judicature Act 1873.)  Rule 15 read as follows:-

"No appeal to the Court of Appeal from any interlocutory order, ... shall, except by special leave of the Court of Appeal, be brought after the expiration of twenty-one days, and no other appeal shall, except by such leave, be brought after the expiration of one year."

 

10. The Court of Appeal had refused to give the appellants special leave to appeal from a final judgment of Kay J. given over three years earlier.  They then appealed to the House of Lords against the refusal of leave.  The House decided that there was no right of appeal.  Lord Halsbury L.C. accepted that the words "order or judgment" in section 3 of the 1876 Act were capable of including a decision to refuse leave.  The question was whether such a construction could be reconciled with the terms and purpose of Order LVIII, r. 15.  He said:-

"But when I look not only at the language used, but at the substance and meaning of the provision, it seems to

me that to give an appeal in this case would defeat the whole object and purview of the order or rule itself, because it is obvious that what was there intended by the Legislature was that there should be in some form or other a power to stop an appeal - that there should not be an appeal unless some particular body pointed out by the statute (I will see in a moment what that body is), should permit that an appeal should be given.  Now just let us consider what that means, that an appeal shall not be given unless some particular body consents to its being given.  Surely if that is intended as a check to unnecessary or frivolous appeals it becomes absolutely illusory if you can appeal from that decision or leave, or whatever it is to be called itself.  How could any Court of Review determine whether leave ought to be given or not without hearing and determining upon the hearing whether it was a fit case for an appeal?  And if the intermediate Court could enter and must enter into that question, then the Court which is the ultimate Court of Appeal must do so also.  The result of that would be that in construing this order, which as I have said is obviously intended to prevent frivolous and unnecessary appeals, you might in truth have two appeals in every case in which, following the ordinary course of things, there would be only one; because if there is a power to appeal when the order has been refused, it would seem to follow as a necessary consequence that you must have a right to appeal when leave has been granted, the result of which is that the person against whom the leave has been granted might appeal from that, and inasmuch as this is no stay of proceeding the Court of Appeal might be entertaining an appeal upon the very same question when this House was entertaining the question whether the Court of Appeal ought ever to have granted the appeal.  My Lords, it seems to me that that would reduce the provision to such an absurdity that even if the language were more clear than is contended on the other side one really ought to give it a reasonable construction."

 

11. Lord Bramwell was troubled by the fact that when the Rules were enacted in 1873, there was to be no right of appeal to the House of Lords at all.  He therefore found it difficult to construe Order LVIII, r. 15 as having excluded a right of appeal which did not exist, or as having prospectively restricted  the  general  language  of section 3 of the 1876 Act. But he did not bring himself to dissent.  The other members of the House had no such difficulty, Lord Herschell saying that a refusal of leave to appeal was "not, within the true meaning of the Appellate Jurisdiction Act, an order or judgment from which there can be an appeal".

 

12. The ratio decidendi of Lane v. Esdaile [1891] AC 210 was analysed with great clarity by the Court of Appeal in the following year in the case of In re Housing of the Working Classes Act, 1890, Ex parte Stevenson [1892] 1 QB 609.  The Act conferred powers of compulsory purchase upon local authorities and provided for arbitration on the price.  Sched. II., clause 26(a) provided that a party dissatisfied with the amount of the compensation ascertained by an award:-

"may, upon obtaining the leave of the High Court, which leave may be granted by such Court, or any judge thereof at chambers, in a summary manner, and upon being satisfied that a failure of justice will take place if the leave is not granted, submit the question of the proper amount of compensation to a jury."

 

13. Mr. Stevenson was dissatisfied with the compensation awarded to him by the arbitrator and applied to a judge in chambers for leave to appeal to a jury.  The application was refused and the Court of Appeal, following Lane v. Esdaile, held that there was no appeal against the refusal.  Lord Esher M.R. first analysed the nature of the statutory right to take the matter before a jury and said that it was, upon the true construction of the Act, a right of appeal.  He then went on to say:-

"I am, on principle and on consideration of the authorities that have been cited, prepared to lay down the proposition that, wherever power is given to a legal authority to grant or refuse leave to appeal, the decision of that authority is, from the very nature of the thing, final and conclusive and without appeal, unless an appeal from it is expressly given.  So, if the decision in this case is to be taken to be that of the judge at chambers, he is the legal authority to decide the matter, and his decision is final; if it is to be taken to be that of the High Court, then they are the legal authority entrusted with the responsibility of deciding whether there shall be leave to appeal, and their decision is final.  In either case there is no appeal to this Court. What was said in the case of Lane v. Esdaile supports the view that I am taking.  But the very nature of the thing really concludes the question; for, if, where a legal authority has power to decide whether leave to appeal shall be given or refused, there can be an appeal from that decision, the result is an absurdity, and the provision is made of no effect.  If the contention for the claimant be correct, it would follow that the case might be taken from one Court to another till it reached the House of Lords on the question whether there should be leave to appeal."

 

14. The judgment of Fry L.J. was to the same effect:-

"The legislature has thought fit to impose a condition in respect of this right of appeal, viz., that the leave of the High Court must be obtained, which leave is to be granted in the manner pointed out, viz., either by the Divisional Court or by a judge at chambers.  Then is the order - for such I will assume it to be - of the High Court, granting or refusing leave to appeal, subject to appeal?  In my opinion it is not.  I do not come to that conclusion on the ground that the word `order' is not properly applicable to it; but from the nature of the thing and the object of the legislature in imposing this fetter on appeals.  The object clearly was to prevent frivolous and needless appeals.  If, from an order refusing leave to appeal, there may be an appeal, the result will be that, in attempting to prevent needless and frivolous appeals, the legislature will have introduced a new series of appeals with regard to the leave to appeal.  Suppose, for the sake of argument, that in this case the claimant's grounds for wishing to appeal are frivolous; if the contention on his behalf is correct, he could appeal from the judge at chambers to the Divisional Court, from the Divisional Court to this Court, and from this Court to the House of Lords on the question whether he shall be allowed to appeal.  It appears to me that that would be an absurd result in the case of a provision the object of which is to prevent frivolous and needless appeals.  Therefore, from the very nature of the thing the decision of the Court which has the power of giving leave to appeal is, in my opinion, final.  This seems to me to be the ratio decidendi of Lane v. Esdaile.  That case appears to decide that, where the right to appeal depends upon the granting or refusal of leave to appeal by a Court, that granting or refusal of leave must be final."  Lopes L.J. said:-

"Where an appeal is given that is made subject to the leave of the Court or a judge, or any other legal authority, I think that the granting or refusal of leave by such Court, or judge, or other legal authority, is final and unappealable.  The object of making appeals subject to leave is to prevent unnecessary and frivolous appeals.  If an appeal were allowed from the granting or refusal of leave to appeal, the result would be that, instead of checking appeals, they might be multiplied to a most mischievous extent; for an appeal from the granting or refusal of leave might be carried from the Divisional Court to this Court, and from this Court to the House of Lords."

 

15. Their Lordships consider that the principle in Lane v. Esdaile, as explained in In re Housing of the Working Classes Act, 1890, Ex parte Stevenson, is that a provision requiring the leave of a court to appeal will by necessary intendment exclude an appeal against the grant or refusal of leave, notwithstanding the general language of a statutory right of appeal against decisions of that court.  This construction is based upon the "nature of the thing" and the absurdity of allowing an appeal against a decision under a provision designed to limit the right of appeal.  This absurdity is greatest in a case such as Lane v. Esdaile, in which the appeal is brought to or from the very tribunal to which it is desired to appeal on the merits.  As Lord Halsbury pointed out, an appeal against the refusal of leave would involve the higher court in doing the very thing which the provision was designed to prevent, namely, having to examine the merits of the decision appealed against.  The Stevenson case generalises the proposition to cover all cases in which leave to appeal is required, even if the tribunal before which the applicant seeks a rehearing on the merits (in that case, a jury) is not the same as that to or from which he seeks to appeal against the refusal of leave.  But the emphasis which the Court of Appeal in that case placed upon characterising the hearing before the jury as an appeal shows that the judges would not necessarily have been willing to state the principle any more widely and to include cases in which leave is required to do something other than appeal.  For example, it has never been suggested that the provisions of the rules which require the leave of the court to serve process out of the jurisdiction impliedly exclude the right of appeal against the refusal of such leave.  Leave to apply for an order of certiorari in Bermuda is required by rule 5(1) of the Administration of Justice (Prerogative Writs) Rules 1978 (BR 28/78), made by the Chief Justice under section 14 of the Administration of Justice (Prerogative Writs) Act 1978.  Section 9 of the Act abolished the ancient prerogative writs of mandamus, prohibition and certiorari and section 10 substituted orders of mandamus, prohibition and certiorari which could be made in proceedings commenced by originating summons.  A similar change had been made in England by the Administration of Justice (Miscellaneous Provisions) Act 1938.  Under the former English practice, a person seeking the issue of a prerogative writ applied ex parte to the Divisional Court for an order nisi requiring the respondent to appear and show cause why the writ should not issue: see Short and Mellor, Crown Office Practice (1890) at page 129.  When the writs were abolished, the Rules of the Supreme Court (Divisional Courts) 1938 introduced a new Order LIX which, in rule 3, substituted for the order nisi the requirement of leave to apply for the new orders of mandamus, prohibition or certiorari.  Similarly, rule 5(1) of the 1978 Rules in Bermuda provides that "No summons shall issue without the leave of a judge".  In Bermuda, as in England, the Rules provided that application for such leave should be made ex parte.

 

16. Section 13 of the 1978 Act expressly confers a right of appeal against an order granting or refusing an order of mandamus, prohibition or certiorari.  The Attorney-General of Bermuda, who appeared for the Minister of Finance and the Registrar of Companies, submitted that this section constituted an exhaustive code of appeals under the Act and impliedly excluded any appeal under section 12 of the 1964 Act against the refusal of leave.  Their Lordships do not think that this inference can be drawn.  The requirement of leave does not appear in the 1978 Act at all.  It is introduced by the Rules and must be read in that context.  An order made or refused under the Rules can only be excluded from the general right of appeal in section 12 by express words or a necessary implication from the Rules themselves.

 

17. The question is therefore whether the requirement of leave to issue a summons for an order of certiorari is sufficiently analogous to a requirement of leave to appeal to attract the reasoning in Lane v. Esdaile and Stevenson's case and enable a court to say that an appeal from the grant or refusal of such leave  would  so  frustrate the policy of requiring leave as to show, by necessary intendment and "the nature of the thing", that such orders were excluded from the general right of appeal in section 12 of the Court of Appeal Act 1964.  For this purpose it is necessary for their Lordships to consider what the policy of the leave requirement is.

 

In O'Reilly v. Mackman [1983] 2 AC 237, 280 Lord Diplock explained that the purpose of the leave requirement was to protect the public administration against false, frivolous or tardy challenges to official action.  This policy has something in common with the policy of requiring leave to appeal, namely to act as a filter against frivolous or unmeritorious proceedings.  It is also true that some types of judicial review, for example, on the ground of error of law by an inferior tribunal, are in practice indistinguishable from appeals.

 

18. In principle, however, judicial review is quite different from an appeal.  It is concerned with the legality rather than the merits of the decision, with the jurisdiction of the decision-maker and the fairness of the decision-making process rather than whether the decision was correct.  In the case of a restriction on the right of appeal, the policy is to limit the number of times which a litigant may require the same question to be decided.  The court is specifically given power to decide that a decision on a particular question should be final.  There is obviously a strong case for saying that in the absence of express contrary language, such a decision should itself be final.   But judicial review seldom involves deciding a question which someone else has already decided.  In many cases, the decision-maker will not have addressed his mind to the question at all.  The application for leave may be the first time that the issue of the legality of the decision is raised and their Lordships think it is by no means obvious that a refusal of leave to challenge its legality should be final.  The law reports reveal a number of important points of administrative law which have been decided by the Court of Appeal or House of Lords in cases in which leave was refused at first instance.

 

19. In principle, therefore, their Lordships do not think it possible to say that the very nature of the leave requirement for an order of certiorari excludes, or makes absurd, the possibility of an appeal.  But unless such a conclusion can be drawn, their Lordships consider it very difficult to find the necessary  intendment  restricting  the general right of appeal conferred by section 12.  It may be appropriate, as a matter of policy, to restrict that right of appeal, but their Lordships consider that this is a matter for legislation rather than judicial interpretation.

 

20. Both sides claimed to find support in the practice which has existed in England.  There is no doubt that an applicant refused leave by a judge or the Divisional Court of the Queen's Bench Division may bring his application before the Court of Appeal and, as their Lordships have said, a number of important cases have taken this route.  A Practice Direction ([1982] 1 W.L.R. 1375) dated 2nd November 1982 and issued by Lord Lane C.J. and Sir John Donaldson M.R. said in plain terms:-

"A refusal in a non-criminal cause or matter by a Divisional Court of the Queen's Bench Division or by a single judge to grant leave to apply for judicial review is appealable to the Court of Appeal."

 

21. But Miss Gloster Q.C. submitted that this statement was a misuse of language.  It is true that an applicant refused leave may go to the Court of Appeal, but such an application is not truly an appeal.  It is an exercise of an anomalous original jurisdiction by the Court of Appeal, based upon RSC Ord. 59, r.14 (3), which reads as follows:-

"Where an ex parte application has been refused by the Court below, an application for a similar purpose may be made to the Court of Appeal ex parte within 7 days after the date of the refusal."

 

22. Miss Gloster says that in England the existence of this original jurisdiction might have obscured the fact that the principle in Lane v. Esdaile [1891] AC 210 excludes a true right of appeal.  In Bermuda, however, the Rules confer no such original jurisdiction and Lane v. Esdaile therefore bars the applicant from getting to the Court of Appeal at all.

 

23. It is true that there are cases in which judges described applications under RSC Ord. 59, r. 14(3) as the exercise of an original jurisdiction.  But the explanations of the jurisdiction in the cases are by no means consistent.  In Dhillon v. Secretary of State for the Home Department (1988) 86 Cr. App. R. 14 Sir John Donaldson M.R., who had been party to the Practice Direction already mentioned, discussed the jurisdiction of the Court of Appeal in the following terms:-

 

"Lane v. Esdaile [1891] AC 210 is of general application and provides that where leave to bring proceedings is required it is not possible to appeal a refusal to grant leave.  The reason is obvious, namely that if you could appeal such a refusal there would be no point in having a screening process.  Every case would be appealed either on the issue of leave or that of substance.  It follows from that that it is not open to Mr. Dhillon, or anybody in his position, to appeal to this court from a refusal by the Divisional Court or by a single judge to grant leave to apply ...

 

24. On the other hand, this court has a special jurisdiction in judicial review matters - the origin of which is lost in the mists of recent antiquity and plainly it is not open to us to challenge it at this stage - whereby we can consider a renewed application for leave to grant judicial review."

 

Similarly in Regina v. Secretary of State for the Home Department, Ex parte Turkoglu [1988] 1 Q.B. 398, 400, Sir John Donaldson M.R. said in reference to Dhillon v. Secretary of State for the Home Department:-

"As I pointed out in the judgment, if on the adjourned hearing of the application for leave to apply before the High Court the judge had dismissed the application, there could be no appeal to this court.  There would be a power to renew that application to this court, but no appeal: Lane v. Esdaile [1891] AC 210."

 

25. Miss Gloster naturally relies strongly upon these passages.  On the other hand, in Begum v. Secretary of State for the Home Department [1990] Imm. A.R. 1 and in Doorga v. Secretary of State for the Home Department [1990] Imm. A.R. 98 Lord Donaldson M.R. appeared willing to contemplate the possibility of an appeal by an applicant whose leave granted ex parte had (as in this case) been subsequently discharged.  Furthermore, in Rickards v. Rickards [1990] Fam 194, 201, Lord Donaldson M.R. said:-

"In my judgment what Lane v. Esdaile decided, and all that it decided, was that where it is provided that an appeal shall lie by leave of a particular court or courts, neither the grant nor refusal of leave is an appealable decision."  This formulation of the ratio decidendi, which would not apply to appeals from a refusal of leave to apply for judicial review, may be contrasted with the much wider formulation in Dhillon v. Secretary of State for the Home Department (1988) 86 Cr. App. R. 14 quoted above, which would, on its face, apply even to leave to serve proceedings out of the jurisdiction.  Finally, in R. v. Special Educational Needs Tribunal, Ex parte South Glamorgan Council [1996] E.L.R. 326 the Court of Appeal entertained an appeal by a respondent against the judge's refusal to discharge leave granted ex parte, although as Lord Donaldson M.R. observed in Rickards v. Rickards [1990] Fam 194, 201 and the House of Lords decided in Geogas S.A. v. Trammo Gas Ltd [1991] 1 W.L.R. 776, the principle in Lane v. Esdaile, if applicable, excludes an appeal against the grant of leave just as much as against its refusal.

 

26. The jurisdiction of the English Court of Appeal, like that of the Bermuda Court of Appeal, is exclusively appellate in character.  Sections 18 and 19 of the Judicature Act 1873, which established the original jurisdiction of the Court of Appeal, conferred upon it the jurisdiction of the High Court only "for all the purposes of and incidental to the hearing and determination of any Appeal within its jurisdiction" and this remains the position under section 15 of the Supreme Court Act 1981, which is the statute currently in force.  In In re Racal Communications Ltd [1981] AC 374, 381, Lord Diplock said:-

"The jurisdiction of the Court of Appeal is wholly statutory; it is appellate only.  The court has no original jurisdiction.  It has no jurisdiction itself to entertain any original application for judicial review; it has appellate jurisdiction over judgments and orders of the High Court made by that court on applications for judicial review."

 

27. On a reading of the relevant statutory provisions, their Lordships would respectfully agree.  It would therefore seem to their Lordships that in some of the cases which have been cited, the nature of a renewed application ex parte to the Court of Appeal under RSC Ord 59, r. 14(3) may have been misunderstood.  A similar provision has been in the Rules of the Supreme Court since the original Rules scheduled to the Judicature Act 1875, where it appeared as Ord. LVIII, r. 10.  It may well be, although neither counsel nor their Lordships have undertaken any research into earlier history, that it derives from the practice of the nineteenth century Court of Appeal  in  Chancery.   The  Rules scheduled to the 1873 Act were largely based upon earlier practice.  At any rate, the rule appears to their Lordships to be entirely procedural.  In the case of an appeal against the refusal of an application ex parte, it is plainly inappropriate to follow the ordinary procedure of giving notice of appeal to the other party.  Ord. LVIII, r. 10 therefore provided for an appeal by way of renewal of the application to the Court of Appeal, but limited the period for such appeal to four (now seven) days after the refusal of an order in the court below.  That such was the understanding of the contemporary Chancery Bar appears from the following comment in Sir Arthur Underhill's Manual of the Procedure of the Chancery Division (1881):-

"Where an application to the High Court is ex parte, an appeal from its refusal is also ex parte, and in that case, it is made by motion without setting it down or entering it for hearing, but such appeal motion must be made within four days unless a judge of the court below, or of the Court of Appeal, extends the time."

 

28. There is evidence of a similar understanding about the former practice in the Crown Office list.  In 1938, the new RSC Ord. LIX provided in Rule 3(5) that a refusal of leave to apply for judicial review by the Divisional Court, either in its original jurisdiction or on appeal from a judge in chambers, should "be final".  In 1947 the Rule was amended to provide that only a decision on appeal should be final.  Since then, unsuccessful applicants to the Divisional Court have been free to apply to the Court of Appeal, although the language of the rule - "shall be final" - does not decide the question of whether such applications are original or by way of appeal.  But J.O. Griffits's Guide to the Practice of the Crown Office (1947), published just before the 1947 amendment, said (at page 324) that under the pre-1938 procedure of applying for a rule nisi, an applicant had a right of appeal to the Court of Appeal from the refusal of Divisional Court to make an order nisi.  The author noted that a similar right had been excluded by the 1938 Ord LIX but added:-

"Should this right be again restored by any future amendment of Order 59 the following practice as to appealing would, no doubt, be revived.

 

29. Where an ex parte application had been refused by the Divisional  Court,  an  application for a similar purpose

could be made to the C. of A. ex parte within four days from the date of such refusal, or within such enlarged time as the Divisional Court or the C. of A. may allow."

 

30. Their Lordships therefore consider that a renewed application to the Court of Appeal under RSC Ord. 59, r. 14(3) is a true appeal with a procedure adapted to its ex parte nature.  If the rule had been intended to create an anomalous exception to the principle in Lane v. Esdaile [1891] AC 210, it would hardly have been restricted to the refusal of applications ex parte.  It should logically have been extended to appeals from the discharge of leave after an inter partes hearing and from a refusal to discharge such leave.  But appeals against all such orders are regularly entertained and their existence is inconsistent with the application of the principle in Lane v. Esdaile [1891] AC 210 to appeals from the refusal of leave to apply for judicial review.

 

31. This brings their Lordships to the decision of the House of Lords in In re Poh [1983] 1 W.L.R. 2.  The applicant had unsuccessfully applied to the Divisional Court for leave to apply for judicial review and renewed his application, equally unsuccessfully, to the Court of Appeal.  He then petitioned for leave to appeal to the House of Lords.  The House, in a short ex tempore speech given by Lord Diplock and concurred in by Lords Fraser of Tullybelton, Keith of Kinkel, Scarman and Roskill, decided that on the principle of Lane v. Esdaile the House had no jurisdiction to hear such an appeal.  Lord Diplock said that their Lordships were "not concerned with the procedure whereby this appeal moved from the Divisional Court to the Court of Appeal".  Then, after referring to Lane v. Esdaile and Stevenson's case, he said:-

"In their Lordships' view this case is clearly covered by the rule in Lane v. Esdaile [1891] AC 210 and the House has no jurisdiction to entertain it."

 

32. Lord Diplock gave no explanation as to why he considered that the case was covered by Lane v. Esdaile.  He went on to say that Suthendran v. Immigration Appeal Tribunal [1977] AC 359, in which such an appeal had been entertained (and had eventually been rejected only by a bare majority), had been entertained per incuriam.

 

33. It would not be right for their Lordships to make any comment  upon this decision in its application to appeals from

the English Court of Appeal to the House of Lords.  But the judgment expressly disclaimed any expression of view upon the nature of "the procedure whereby this appeal moved from the Divisional Court to the Court of Appeal".  The decision is therefore not inconsistent with their Lordships' opinion that the application to the Court of Appeal is a true appeal, not excluded by the principle in Lane v. Esdaile.  Their Lordships accept that this conclusion makes it difficult to identify the reasoning by which the House of Lords decided that the principle applied to a further appeal to the House of Lords and it appears to them understandable that the Court of Appeal of Bermuda should have treated In re Poh [1983] 1 W.L.R. 2 as authority on the point before them.  Nevertheless,  the limited nature of the ratio decidendi of Lane v. Esdaile as explained by the Court of Appeal in Stevenson's case, the important differences between applications for leave to appeal and applications for leave to apply for judicial review and the long-standing practice of the English Court of Appeal to entertain such appeals have persuaded their Lordships that whatever may have been the reasoning in In re Poh, it is not applicable to this case.

 

34. Their Lordships therefore consider that the Court of Appeal had jurisdiction to hear the appeal and will humbly advise Her Majesty that the appeal should be allowed.  The respondents must pay Kemper's costs in the Court of Appeal and before their Lordships' Board.  On the other hand, Kemper must pay the costs of the respondents occasioned by the application for the ruling on a preliminary issue.

 

© CROWN COPYRIGHT as at the date of judgment.