BAILII [Home] [Databases] [World Law] [Multidatabase Search] [Help] [Feedback]

England and Wales Court of Appeal (Civil Division) Decisions


You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> AP (UK) Ltd v West Midlands Fire & Civil Defence Authority [2001] EWCA Civ 1917 (16 November 2001)
URL: http://www.bailii.org/ew/cases/EWCA/Civ/2001/1917.html
Cite as: [2001] EWCA Civ 1917, [2002] CLC 766, [2002] CPLR 57

[New search] [Printable RTF version] [Help]


Neutral Citation Number: [2001] EWCA Civ 1917
No A3/2000/0640

IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM ORDER OF
HER HONOUR JUDGE CAROLINE ALTON

Royal Courts of Justice
Strand
London WC2
Friday, 16th November 2001

B e f o r e :

LORD JUSTICE WARD
LORD JUSTICE JONATHAN PARKER
LORD JUSTICE LONGMORE

____________________

AP (UK) LTD
Appellants/Claimants
- v -
WEST MIDLANDS FIRE & CIVIL DEFENCE AUTHORITY
Respondents/Defendants

____________________

(Computer Aided Transcript of the Palantype Notes of
Smith Bernal Reporting Limited, 190 Fleet Street,
London EC4A 2HD
Tel: 0171 421 4040
Official Shorthand Writers to the Court)

____________________

MR HAROLD BURNETT QC (Instructed by Bracher Rawlins of London) appeared on behalf of the Appellant
MR ROGER TER HAAR QC and MR STUART CATCHPOLE (Instructed by Davies Arnold Cooper of London)
appeared on behalf of the Respondent

____________________

HTML VERSION OF JUDGMENT
____________________

Crown Copyright ©

  1. LORD JUSTICE LONGMORE: We have three appeals before us this afternoon. The first raises a question of principle, namely whether, if it is right to require a claimant to put up security for the costs of an action, it may be appropriate that the security given should be by way of a charge on the claimants' own property in favour of the defendant and, if so, in what circumstances. In the present case Her Honour Judge Alton, sitting in the Mercantile Court in Birmingham, on 1st March 2001, refused to make such an order not as a matter of principle but because she considered the value of the properties put forward for the purpose of the charge to be insufficient. Having reached that conclusion, she made an order that the claim should stand dismissed unless security in the traditional form of payment into court or a bank guarantee was put up by 16th March 2001. On 15th March Judge Alton refused an application for a 40-day extension of time requested by the claimant for the purposes of putting up security in a traditional form so that the claim did stand dismissed on 16th March.
  2. The second appeal is from that order.
  3. The third appeal relates to the costs of a hearing of an earlier application under Part 24 of the Civil Procedure Rules by Judge Alton on 3rd and 4th October 2000. It was an application for summary judgment brought by the defendants which, in the event, failed. Judge Alton reserved the costs of the application. On 5th April 2001, after the claim had been dismissed for failure to provide security for costs as ordered, Judge Alton decided that the right order was that the costs of the Part 24 application should be the claimants' costs in the case. The claimants now appeal against that order, submitting that the right order was that they, the claimants, should have the costs in any event.
  4. I must say something about the facts of the case and the chronology. The claim is brought by a company, AP (UK) Ltd, who are the manufacturers of paper tissue products at a factory at Fourth Avenue, Bushbury, Wolverhampton. On 7th February 1999 there was a fire at those premises. That fire was attended by the fire brigade who are the responsibility of the defendants in this case, the West Midland and Civil Defence Authority.
  5. On 17th May 1999 the claimants' solicitors wrote to the West Midland Fire Authority to ask if they could interview Mr Powner, one of the fire officers who had attended at the scene. The following month they did interview Mr Powner while he was on sick leave in the company of a specialist adviser to the claimants. Mr Powner was alleged to have indicated that the fire was confined to tissues in a single bay of the premises when there were no dancing flames or smoke.
  6. On 24th December the claimants then issued a claim form claiming, first, under the insurance policy with their fire insurers or, alternatively, in damages against their brokers in case the insurers were right (as they had apparently done) to have avoided or determined the policy; thirdly, against these defendants, the West Midland Fire Authority, alleging that the fire had died down before the brigade arrived but that their use of hoses led to the fire being stirred up and causing a major conflagration to break out. Those proceedings were brought in the Commercial Court.
  7. At a case management conference chaired, as it happens, by myself I made an order that the claim against the West Midlands Fire Authority should be severed from the rest of the case and that it should be transferred to the Mercantile Court in Birmingham.
  8. On 11th April the defendants served a defence, which was a full document which condescended to considerable particularity. The defendants invited the claimants to set out their answer to the defence fully in their reply. That did not happen, at any rate, to the satisfaction of the defendants so the defendants took out the Part 24 application which I have mentioned. That was argued on 3rd and 4th October and was refused by Her Honour Judge Alton who reserved the costs. The case was in due course fixed for trial for 10 to 15 days to begin on 25th June 2001.
  9. There followed correspondence in which the defendants' solicitors pointed out to the claimants that they had not filed their latest accounts for the year ending 30th September 1999 which should have been filed by 30th July 2000. The claimants' solicitors asked for copies of those accounts. No satisfactory response was forthcoming and no accounts were filed.
  10. On 5th January 2001 the defendants issued an application for security for costs. There was a hard fought application in relation to security for costs which took place on 26th January 2001 in which the claimants said that in outline there was no need to order any security because they were good for any sum which would be ordered against them. That was not, in the event, accepted by the judge who made an order for costs in the sum of £135,000 to be paid into court by 9th February 2001 or to be given by way of guarantee or other security with a stay of the action meanwhile. The judge made it clear that that was security for costs up to the pre-trial review but that she would entertain an application for further security, if thought appropriate, not before that date.
  11. On 9th February, the day on which the security had to be provided, a letter from the claimants' solicitors was delivered by hand to the defendants' solicitors offering, by way of compliance with the order, a second charge on the property at Bushbury which was said to be valued in the sum of £925,000. There was immediately a question as to whether that could be compliance with the order. An application was fixed to determine that question on 19th February. On that date - which in the event the judge was unable to manage because, unfortunately, she was ill - a statement from Mr Patel was served which revealed the existence of a further charge on the Bushbury property and also that there was a charge on his own matrimonial home in respect of his own solicitors' fees. The statement went on to offer, in addition to the Bushbury offer, that there could be a shared charge on Mr Patel's share of the free equity of the matrimonial home shared with the claimants' own solicitors and reference was also made to another property in which he and his wife had lived - and was still owned by his wife - at Nevis Court worth £70,000.
  12. The application, which was effectively an application for an extension of time in which to provide the security and for a declaration that it could be provided by way of charges on the property, was heard by the judge on the telephone on 26th February. On 28th February she refused that application that security could be provided by way of charge on the various properties. Further argument was on that day abandoned because in her court building there was a fire alarm and she had to leave, but was resumed on the following day when she made the final order for dismissal unless security was provided by 4.30 on 16th March. On 15th March, the day before the final order was to take effect, there arrived from the claimants an application for an extension of time for 40 days to provide the security until 25th April. Again, the judge had to hear the application on the telephone. The application was based on the fact that goods which had been or were to be shortly sold in El Salvador were to be paid for by a confirmed letter of credit that had recently arrived. The judge dismissed that application. Accordingly, on 16th March the entire claim was dismissed. On 5th April she made the order in respect of the costs of the summary judgment application that the costs be the claimants' costs in the case.
  13. I turn to the first appeal and deal, first, with the question of principle, namely whether it is appropriate for the claimants to be committed to give security for costs by granting a charge or charges on its real property. The suggestion comes as something of a surprise since, for myself, I have never come across such a suggestion in a commercial or mercantile action. The reason for that must be that in a normal case if real property is sufficiently valuable to stand as security there will be no difficulty in the claimants procuring a bank guarantee for the purpose of security for costs by, if appropriate, granting a charge to the bank. So, one asks, is there any explanation why the bank will not provide a guarantee against one or more charges on the claimants' property in this case? The answer to that question is no, there is not. Paragraph 26 of Mr Patel's affidavit states merely that banks were not prepared to lend the sum of £135,000 to the claimant company unless the claimant company got money from its insurers or otherwise strengthened its balance sheet.
  14. Mr Burnett QC, who appeared for the claimants below and the appellant here, asserted the existence of a principle that if security is adequate it is not for the court or for the defendants to say that it should be in any particular form. For that purpose he relies on Rosengrens Ltd v Safe Deposit Centres Ltd [1984] 1 WLR 1334 and, in particular, on the headnote in the All England report of that case and the judgment of Lord Justice Parker at page 1337 in the following terms:
  15. "The process of giving security is one which arises constantly. Very often very large sums may be involved in actions which take place in the Commercial Court or, indeed, other courts. So long as the opposite party can be adequately protected, it is right and proper that the security should be given in a way which is the least disadvantageous to the party giving that security.
    It may take many forms. Bank guarantee and payment into court are but two of them. Frequently security is considered wholly adequate when it is provided merely by a London solicitor's undertaking. So long as it is adequate, then the form of it is a matter which is immaterial. Day after day orders will be found when the initial order of the court is that security be given within so many days in a particular amount to the satisfaction of the court. The person giving the security will then have an opportunity to say how he wishes to give it; and, as long as it is adequate to protect the opposite party, it is not his concern whether it should be in one form rather than another."
  16. In my judgment, the reliance on the dicta of Lord Justice Parker by Mr Burnett is misplaced on the facts of this case. The options canvassed by Lord Justice Parker as being alternative to payment of the money into court were, first, a solicitor's undertaking and, secondly, a bank guarantee. Those methods of compliance with the order of the court are both simple and straightforward if enforcement becomes necessary. There is no suggestion by the Lord Justice of a charge on real property with all the risks that would follow from enforcement of that charge and a forced sale. It is noteworthy that Sir John Donaldson MR did not express himself as broadly as Lord Justice Parker and that the issue in the actual case before the Court of Appeal was whether an order for security for costs having been made, it could be complied with by providing a bank guarantee. Not surprisingly, with respect, the court concluded that a bank guarantee would be satisfactory.
  17. The second authority on which Mr Burnett relied was Re I, a decision of a single Lord Justice on a question of security for costs of an appeal by a father against a refusal by the court below to make an order that his children be removed forthwith from England to Nigeria. It appears from the very short judgment of Lord Justice Swinton Thomas that all the appellant had to offer by way of security for costs of the appeal was the equity in his London home. The Lord Justice said no more than that a charge on his home should be "convenient". That was a domestic dispute and, in my judgment, rather different from a commercial dispute of the kind with which this court is here concerned where the parties have ready access to banks as part of their commercial business. No doubt, if an offer of a charge on a valuable unencumbered property such as, for example, the British Museum were offered by way of security for costs it would not be right to exclude it automatically but even in such a circumstance the court would still wish to know why an undertaking from the trustees or their solicitors would not, in such a case, be sufficient and if it was not sufficient, why, no bank was apparently prepared to lend on the property offered as security. The judge in the present case used the fact that no bank would apparently lend money on the security proposed to support her eventual finding that the property was inadequate to provide security.
  18. For myself, I would say more broadly that if no bank will lend on the security of proposed real property that will mean the proposed security is inadequate unless there is a reason to explain why the defendants should be required to accept security by way of charge on property when no bank is prepared to do just that. Here, there is no such reason offered and there is none.
  19. I would therefore dismiss the first appeal on the basis that without an explanation why money or a guarantee cannot be raised by the claimants from their bank by charging their property to the bank, it is impossible to conclude that the security offered by the claimants was adequate security for costs. It is therefore unnecessary to be drawn into detailed discussion of the security offered. But since argument has been deployed upon it I will consider it briefly since the history of the matter is instructive.
  20. There were three properties. The first was the Fourth Avenue, Bushbury premises. This was originally offered as a second charge after a charge in favour of a company called Shay Investments. There was a second charge already in existence but not recorded in the register. It was however said that that second chargee, a company called City Europe, was willing to agree that any charge in favour of the West Midlands Fire Authority would take priority over their own charge. There was also a sub-charge over the first charge in favour of a company called Anglo-Irish to secure borrowing by Shay Investments, apparently to purchase or to lease the premises currently let to the claimants where they now conduct their business after the fire. It was said that Anglo-Irish was prepared to agree jointly with Shay, and perhaps with City Europe, to cap their charge at £650,000. There were three valuations of that property: one dated 18th March 1999 between £925,000 and £1,000,000; a later one of May 1999 of £775,000; and a third one, more relevantly, of 16th February 2001 of £850,000 on the assumption of the existing use continuing but that valuation said that the property would require an extended marketing period or, alternatively, a valuation of £1,200,000 with planning consent. All those valuations were valuations of the well known valuers, Chestertons. There was also a written offer to take an option to buy for a period of two years at £950,000 from Mr Garvey and it was said that he had later orally varied that offer to make it an outright offer to purchase at £960,000. But there was no written evidence of that valuation.
  21. The judge held that the court could not expect someone entitled to security to wait an extended period for its realisation. She rejected evidence of the option offer because it required the property to be held open for a period of two years. She rejected the evidence of the oral variation on the basis it was uncorroborated. Nevertheless, she did accept a figure of £850,000, being the lower of the figures in the third Chesterton's valuation, and she discounted it by a notional figure of 30 per cent to allow for expenses and contingencies, thereby reaching a figure of £595,000 which was below the cap which Shay and Anglo-Irish, with or without the co-operation of City Europe, had agreed of £650,000.
  22. Mr Burnett submitted, first, that her starting figure should have been £1,000,000 inasmuch that she should have taken the figure with planning permission of £1,200,000 reduced by £200,000 to account for clearance of the site at £100,000, and expenses and other
  23. contingencies of another £100,000. On that basis there would be £300,000 or more available even taking into account the cap of £650,000.
  24. Secondly, he submitted that if it was wrong to take the figure of £1,000,000, the figure of £960,000, being the oral offer figure, should have been accepted.
  25. Thirdly, he submitted it was wrong for the judge to take the low figure of £850,000 because anyone would sensibly apply and - he said the evidence was - would almost automatically get planning permission for residential development. He submitted that it was wrong for the judge to take into account any discount without professional evidence to that effect.
  26. As far as those submissions are concerned, I would not myself accept, if one gets into this sort of exercise at all, that it would be appropriate to take a valuation on the assumption that planning permission was or would be obtained. That would throw the risk of failure to get planning permission on the West Midlands Fire Authority which, it seems to me, cannot be right. Secondly, the evidence of the offer was inherently insubstantial. Evidence of an oral variation to a written offer is, in my judgment, inadequate. If this exercise is appropriate at all, the court can only go on written valuations.
  27. In my judgment, the judge was correct to take the lower value because that was all that could be immediately realised and even that could only be realised after a marketing period. Therefore it seems that if one takes into account the cap, only £200,000 would be freely available on this property. There obviously would have to be a discount for the elements of a forced sale, for the expenses of such a sale and general risks such as a fall in the market over the relevant period. Mr Burnett's original submission that no discount should be made, as set out in his skeleton argument, is wholly unreal. Even he, in the course of his oral argument, accepts that there would have to be a discount of £100,000 plus the costs of clearing the site, making £200,000 in all. The fact that one debates these figures in the air shows how unreal the exercise is.
  28. Lastly, as Lord Justice Jonathan Parker pointed out in argument, the whole exercise is redolent of the possibility of arguments that might take place when the security came to be realised as to whether reasonable care had been taken to realise it at the best value. If one gets into the exercise at all, I would uphold the judge's decision on that matter.
  29. As far as the offer in relation to the matrimonial home is concerned at Perton Ridge, Wolverhampton, there was much debate originally before the judge on the proposal that the defendants should be required to take a second charge to rank jointly with the charge in favour of the claimants' own solicitors. The equity in the house was said to be £300,000 to £325,000 on the basis of a drive-by valuation of £500,000 to £525,000 and a current mortgage of about £200,000. The judge deducted 20 per cent to arrive at a value of £400,000 which would mean the equity was £200,000. If one took the claimants' own solicitors' charge on the husband's half that would mean that only £100,000 was available, the other £100,000 only being available if Mrs Patel would be prepared to execute a charge over her share of the matrimonial home after being given independent advice. Not surprisingly, when he came to this court Mr Burnett abandoned any reliance on the matrimonial home. He did rely on Nevis Court, Mrs Patel's home, which was the original matrimonial home and had not been sold. That was described initially as unmortgaged and worth £70,000. It was subject to two charges but it turned out just before the judge gave judgment on 28th February 2001 that those charges could be removed because the debts in respect of which they had been given had been discharged.
  30. In the event, the judge held that the offer was premature because the charges had not yet been removed and also it would have been necessary for Mrs Patel to have been independently advised about that matter. The position is that they have now been removed, we are informed. But the position remains that the valuation is only a valuation on the basis of driving past and looking at the
  31. front of the house; it is in the sum of £70,000. That would have to be discounted by, say, 20 to 25 per cent to a figure of, say, £55,000 to £52,000. Mrs Patel would still have to be independently advised which she had not been at the time the matter was before the judge and there was no evidence of what the result of such independent advice would be.
  32. So the judge's description of the Nevis Court offer being premature seems to me to be a justified description, especially when one considers that the offer was made against the background that security was originally ordered to be put up by 9th February and the claimants were asking for an extension of time for providing the security.
  33. All of this does not take into account at all the fact that the judge made it clear that the figure of £135,000, by way of security for costs, was a current figure only and that if further applications were made before the trial she would be minded to consider such further applications. All this, moreover, is quite apart from the judge's reliance on the repeated inaccuracy and incompleteness of information which was provided to her and the defendants to such an extent that she felt she could not accept the uncorroborated evidence of Mr Patel. In my judgment, she had ample justification for coming to that conclusion also.
  34. The main point is that the above description shows how problematic the idea of putting up security for costs by way of a charge on a claimant's property in favour of a defendant is likely to be, and confirms me in my earlier view that it was unnecessary for the judge to become engaged in the exercise at all. To the extent that she did however engage in it, it seems to me that her conclusions were correct.
  35. For my own part, I would dismiss the first appeal.
  36. The second appeal is against the order refusing an extension of time for providing security in the traditional form. This application was made at the eleventh hour by telephone on the day before the final deadline of 16th March 2001 on which date the claim was to stand dismissed. That was set by the judge's order of 1st March.
  37. The evidence in support of the application was contained in the fifth witness statement of Mr Patel, having previously in his third witness statement said that incoming funds, including money from El Salvador, were earmarked for substantial creditors and could not be made available for security. He instanced the Customs & Excise in the sum of £250,000 and another creditor also to the tune of £250,000. He said in his fifth witness statement in support of the application for an extension of time for providing security as follows:
  38. "11 The new element in the situation, however, which underpins this application, is that the claimant is now the beneficiary of an irrevocable letter of credit in the sum of £591,500 (mentioned in previous witness statements but now a reality)."
  39. That is a reference to moneys expected in relation to the El Salvador matters.
  40. "12 The letter of credit is ..... incorrect. It refers to a clean Bill of Lading whereas the transaction was always on an `ex works' basis. The reference should be for a freight-forwarder's collection note. Mr James Cole of the claimant has pointed this out ..... Mr Billy Guardia of the Siman Group telephoned me from El Salvador earlier today and confirmed that a fresh letter of credit in the correct form has been issued and is on its way to me. It should arrive by the end of next week."
  41. I add, in parenthesis, that even at that stage the correct letter of credit was not able to be put before the court.
  42. Paragraph 15 states:
  43. "15 The position, previously, was that the whole amount of the funds represented by the letter of credit was already committed. This position has changed. The claimant has, as I have mentioned, paid some of its more pressing debts and will pay more in the coming weeks. I have also discussed re-scheduling with a number of creditors. The result is that, if the court is prepared to make the order sought, the claimant would, subject to receipt of the funds in time, be able to use them to provide security in the sum of £135,000 in the form of a cash deposit with its solicitors Bracher Rawlins and their undertaking to the defendant's solicitors, Davies Arnold Cooper."
  44. The position is that if funds come from the letter of credit in time and if discussions about re-scheduling with a number of creditors succeed, the money would be used to provide security in the sum of £135,000. Not surprisingly, the judge did not find that this was sufficiently strong evidence to cause her to lift the sanction of dismissal. She said that the highest it could be put was that the money "will probably be available". That seems to be not an unfair assessment of that evidence. The judge went through the provisions of CPR Part 3.9 and said:
  45. "The fact of the matter is that certainly by the end of January when the court first ruled in this matter it was quite evident that the claimant had simply not addressed what it was going to do if it failed in its opposition to the defendants' application for security. If one looks at the pattern of what has occurred since there has been late reaction rather than advanced planning. It seems to me that this is one of the reasons at least why we are in a position of being faced with an unless order with an application on the last date for that order to be extended."
  46. It is difficult to disagree with that assessment. The judge went on as follows, referring to Mr Catchpole who was then appearing on behalf of the defendants:
  47. "Mr Catchpole said at this stage the claimant, faced with an unless order which will not be complied with and seeking an extension, has to put forward a compelling case as to why the court should take that step. With that proposition I agree. Were it otherwise it would have been inappropriate to make the unless order at all. The question is has that compelling case been made? My answer to that is no, it has not."
  48. Mr Burnett submitted that the judge put the test too high - he said much too high - by saying the claimant had to put forward a compelling case why the court should grant relief from the sanction of dismissal.
  49. For myself, I do not consider that she was putting the concept of a compelling case forward in any sense as an additional legal test to the considerations which she enumerated and dealt with in Part 3.9. The matter was one for her discretion. The judge was, in my judgment, entitled to take the view that, in the light of the history and the fact that the application, once again, was being made at the eleventh hour, relief ought not to be granted. I can detect no error of principle in her approach once it is accepted that the original order of 1st March was correctly made. The proposals of the claimants were still far from definite. The result of acceding to the application would inevitably have meant that a 10 to 15 day spread fixed for trial would have had to be abandoned and some other later date would have had to be found. Still less can it be said, in my judgment, that the judge was plainly wrong. I, for my part, would not interfere with the way in which the judge exercised her discretion. So, in my view, the second appeal fails which means that, if my Lords agree with me, the claimants' claim will remain dismissed.
  50. The third appeal relates to the costs of the Part 24 application on 3rd and 4th October 2000. Those costs were reserved by the judge and after the case had been dismissed she decided that the costs should be the claimants' costs in case. Since the case was then over there would be some force in the view that the judge's order sounds slightly odd. But in her judgment of 5th April she makes it abundantly clear that what she would have done if she had had to decide where the costs should lie at the conclusion of the argument on 4th October 2000 would have been to order that they be claimants' costs in case. The reasons for that were that she thought that if the claimants were to win the case they should have their costs of the application.
  51. The judge was doubtful if they would ultimately win the case for two primary reasons. First, the case depended on the facts alleged in paragraph 15 of points of the claim which, in turn, depended on the evidence of Mr Powner of the fire brigade who was interviewed by the claimants' solicitor, Mr Slade, shortly after the fire, but whose statement did in the event not entirely accord with Mr Slade's own notes of interview. Mr Powner had later made clear he wished to give evidence for the fire authority. He had made a second statement not disagreeing with those of two other firemen also intending to give evidence for the fire authority. That would mean, in the judge's view, that the claimants' case was unlikely to get off the ground unless the claimants could show not only that Mr Powner's first statement was correct but, secondly, that the later statements were produced pursuant to a conspiracy to concoct or to provide false evidence. Obviously, the judge could not decide those questions as part of the Part 24 application but she was clearly troubled by the claimants' overall prospects.
  52. Secondly, the claimant had been, as she put it, coy in saying to the court what the evidence of their own employees would be at the trial. After the claimants' solicitor had said in his witness statement in response to the application for summary judgment that the claimants' employees could give evidence the defendants' solicitors put in short statements from the same employees given to the insurance assessors after the fire. On their face, they said that when they left the scene the fire was not as described by Mr Powner and as relied on in paragraph 15 of the points of claim. It is necessary to read a few short passages from the judge's judgment on the summary judgment application to get a flavour of her concerns. First, at page 234 of our bundles it states:
  53. "Mr Ter Haar makes the point that if the disputed Powner statement is to be treated as credible evidence, then the court would have to conclude that there was equally a real prospect that if the claimant would be able to demonstrate that a significant number of the witness statements made by the crews, and in particular Messrs Brown, Sandells and the like, were concocted in order to support an untrue version of events being put forward at a later stage by Mr Powner. That is particularly as to the extent of the fire, the flame and the like at the time of the crew's arrival as well as the target at which the jet of water was directed.
    This brings me back to the third element of teh claimant's evidence or, as Mr Ter Haar would say, the lack of it, namely, the evidence of employees which I am told would be of importance not only in the context of rebuttal of suggestions by the defendant that the fire could have spread from the loose tissue to the bales, but also in the context of providing support for the assertion, which must form part of the claimants' case, which was positively advanced by Mr Burnett, namely that the fire was dying down, or would have died down, by the time that the employees left and the crews arrived, but for the negligent intervention of the fire brigade."
  54. At page 241 it states:
  55. "I have concluded that whilst there are plain and inherent difficulties on the way to success on the claimant's case in a situation where, as here, the foundation of that case relies upon statements said to have been made which are now denied or explained away by those said to have made them, and where, in relation to Powner, Brown and Sandells at least, it would appear highly probable that the claimant would have to advance a conspiracy theory, I cannot ultimately conclude that the claimant has no real prospects of succeeding."
  56. I say in parenthesis that we are now told that an amended pleading has been served alleging a conspiracy theory.
  57. Lastly, in respect of the summary judgment at page 242, it states:
  58. "The trial judge could also conclude that Mr Powner's statement, as recorded by Mr Slade and seemingly confirmed to Mr Mensler's investigation report,"
  59. Mr Mensler is an expert
  60. "was accurate as to the facts on the night, in which case (though not inevitably) the claimants would have succeeded on establishing the essential factual foundation for the case to start getting off the ground, albeit in such circumstances it does seem to me inevitable that the court would also, in order to reach that conclusion, have to be persuaded that there had indeed been some concoction of evidence by Messrs Powner, Brown, Sandells and possibly others."
  61. In the light of that, any application for claimants' costs in case made at the end of the hearing would have been quite unassailable as an exercise of the judge's discretion.
  62. The judge returned to the matter when she gave her judgment on 5th April 2001. All I need to read of that is this (page 847):
  63. "The contemporaneous note disclosed by the solicitors in any event recorded key further information given by Mr Powner which, if correct, would heavily qualify, if not wholly undermine, the accuracy of what it is said he said and would indeed potentially falsify the whole basis of the case. The court had significant concerns as to the accuracy of what was said to be the nature and effect of Mr Powner's evidence at the time and which, as I say, forms the basis of the claimant's case, although I make it absolutely clear I am not in any way intending to reflect upon the honesty of Mr Slade.
    Given my concerns as to this and other matters, including the question of the evidence or absence of evidence in relation to five employees who had previously been fighting the fire before the arrival of the brigade and to which I also refer in my judgment, at the time I concluded that it would not be right to say that there was no real prospect of success. Nevertheless, that conclusion was said to be reached with misgivings."
  64. While the judge should perhaps, more appropriately, have expressed her conclusion at the end of the argument on 5th April in the form of no order as to costs rather than claimants' costs in case, once the case had been dismissed that is something that does not matter in the least. An order for claimants' costs in the case is no less assailable now, in my judgment, than it was if it had been made at the end of the hearing of the summary judgment application on 4th October 2000.
  65. For myself, I would dismiss the third appeal also.
  66. LORD JUSTICE PARKER: I agree that these appeals should be dismissed for the reasons my Lord has given.
  67. LORD JUSTICE WARD: I also agree. The appeals stand dismissed.
  68. MR TER HAAR: My Lord, may I ask for costs?
  69. MR BURNETT: I think my Lord would want me to correct this. I think there was a slip in my Lord, Lord Justice Longmore's, judgment as to one point of fact in that he did say there had been no appeal from the order of 1st March. I know how my Lord was led astray. There are two appeals in one notice of appeal. We did appeal it. That appears from page 14 of the bundle.
  70. LORD JUSTICE LONGMORE: That is correct. It is fair to say you accepted in the course of argument that if the first appeal were to be dismissed then that fell away.
  71. MR BURNETT: I did. I am not suggesting for one moment that there is anything here that affects the judgment in any way whatsoever. I thought my Lord would like to have that formal matter corrected.
  72. LORD JUSTICE LONGMORE: That will be on the transcript.
  73. MR BURNETT: My Lord, I cannot say anything.
  74. LORD JUSTICE WARD: The appeals are dismissed with costs to be assessed.
  75. Order: Appeals dismissed with costs


BAILII: Copyright Policy | Disclaimers | Privacy Policy | Feedback | Donate to BAILII
URL: http://www.bailii.org/ew/cases/EWCA/Civ/2001/1917.html