A2/02/0894, A2/02/0723
Neutral Citation Number: [2002] EWCA Civ 1168
IN THE SUPREME COURT OF JUDICATURE       
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
(Mr Justice Buckley)
                                    Royal Courts of Justice
                                    Strand
                                    London WC2
 
                               Friday, 12th July 2002
B e f o r e :

LORD JUSTICE POTTER

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BOYD & HUTCHINSON (A FIRM)

- v -

JOHAN MICHAEL RICHARD FOENANDER
Applicant
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(Computer Aided Transcript of the Stenograph Notes
of Smith Bernal Reporting Limited
190 Fleet Street, London EC4A 2AG
Telephone No: 0207-421 4040
Fax No: 0207-831 8838
Official Shorthand Writers to the Court)
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THE APPLICANT (assisted by Miss Eva Adshead, litigation friend) appeared in Person.
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J U D G M E N T
1.	LORD JUSTICE POTTER: There are before me two applications for permission to appeal arising out of litigation between the applicant and his former solicitors. They arise in this way. In 1996 the solicitors issued a High Court writ against the applicant claiming £4,200-odd under bills rendered for work done in relation to an ancillary relief dispute. The applicant was dissatisfied with the services rendered, but that is not a matter with which I am concerned on this application. I shall call that action by the solicitors the invoice action. The solicitors obtained judgment by default which was set aside on the applicant's application, the action being transferred to the Lambeth County Court.
2.	There was an appeal to the judge who ordered an adjournment for service of the applicant's objections to the bills. At the adjourned hearing on 2nd December 1996 the judgment was reinstated subject to assessment of the bills, and the applicant was ordered to pay the solicitors' costs of the whole action, including the costs of appeal. In December 1997 the bills of costs (the subject of the invoice action) were assessed at £3,173-odd. It appears that a charging order, dated 17th December 1997, was obtained, in form covering the judgment debt of £3,173 plus the costs of the enforcement proceedings.
3.	I pause there because there is something of a mystery attached to the terms of the charging order in relation to costs. There is in the bundle one form of the order (page 19 of the large bundle before me) which refers to the assets specified in the schedule standing charge of the payment of £3,173.91, the amount due from the defendant to the plaintiff on an order of the High Court/County Court (sic) dated 12th December 1994, together with any interest, and £3,754.87, the costs of the application, the costs of this application, the costs to be added to the judgment debt.
4.	That, according to the applicant ( or Miss Adshead, who acts on his behalf as his litigation friend) is the order which was relied on in the proceedings by the former solicitors until a very late stage. It is difficult to see how an order could have been made in that form because as at 17th December 1997 the costs of the application had not yet been assessed. They were eventually assessed in October 1998, one year later, in the sum of £3,754.87, making a total covered by the charging order of something over £6,900. That order bears the stamp of the Lambeth County Court. It has been a major complaint on the application before me, and a matter of much suspicion, that later in the proceedings, and certainly before Master Turner, a different form of charging order dated 17th December 1997, not bearing the stamp of the Lambeth County Court, was produced by the solicitors. That was one the text of which accorded with the position which must or at any rate could have existed at 17th December 1997, in that it referred to a charge of “£3,173.91, the amount due from the defendant to the plaintiff on an order of this court dated 23rd April 1996” -- note the different day of judgment specified-- “said interest being 73% of the beneficial value of the property”, and then at item 2 ordered that the costs be paid by the applicant/defendant on scale 2 to be taxed if not agreed. As I have already indicated, if that was the order relied upon by the solicitors, it would be consistent with the later taxation which I have already mentioned.
5.	In the event, having commented upon that matter, it appears to have been a matter which the applicant or Miss Adshead was unable to explain before the Master and judge, or at any rate unable to arouse their interest in, so far as can be seen. That is a matter of some concern. However, it is not a matter directly before me on this application, in the sense that this application is concerned with a compromise which was undoubtedly reached in relation to proceedings taken later under the charging order obtained.
6.	In October 1999 the solicitors applied to enforce that charging order in the sum of just over £6,900 plus interest by selling the property. In November 1999, when the hearing of that application was imminent, the proceedings for sale of the property were compromised on the basis of an agreement that the applicant would pay £6,900 by 23rd November 1999 in agreed instalments. That payment was subsequently made. At the time the solicitors applied to enforce the charging order and, well before the compromise which I have mentioned was reached, the solicitors had obtained an assessment of their High Court costs in the invoice action pursuant to the order made on 23rd October 1996. The sum assessed was £5,300-odd. Again, it is a matter of complaint and concern on the part of the applicant that, according to him, the applicant never had notice of that assessment and thus was only aware of any sum alleged to be owing or outstanding under the costs order made in October 1996 at a late stage. At any rate, the solicitors plainly made no effort at the time they had obtained the assessment to bring it to the applicant's attention or to enforce payment. They simply proceeded with enforcement of the charging order which they already had, which did not cover the sum of £5,300-odd for costs in the substantive action.
7.	The compromise agreement reached on the eve of the enforcement hearing was negotiated for the applicant by solicitors recently instructed, Landau & Scanlon (“Landaus”). At the time of the negotiation the solicitor concerned, Mr. De Cruz, was unaware of the outstanding invoice action costs of £5,300, and it appears that he believed that he was simply negotiating the sum to be paid to settle the proceedings for sale under the charging order. In fact, the £6,900 sum payable by instalments, which was secured as the settlement sum, represented a significant reduction of the sum by then due under the charging order, which with interest of some £1,100 due to be added, totalled £8,000 and was payable as a single sum. The applicant was also vulnerable to a further costs order if the matter proceeded to a hearing without agreement. The letter confirming the compromise, which was written by Mr. De Cruz to the solicitors, read as follows. It was headed:
“Yourselves -v- Foenander. Hearing - 23rd November 1999
We write further to our various telephone conversations today to confirm that agreement has been reached in settling the outstanding amount owed to you on the following basis. Upon such agreement being reached we agree to an adjournment of the hearing tomorrow with liberty to restore. The agreement is based on the amount said to be due today under the terms of a charging order absolute obtained by you against our client on 17th December 1997.” 
8.	The instalments and other terms of payment were set out. The final paragraph read:
“Therefore, by payment of the total sum of £6,900 as indicated above, our client will discharge all liabilities due to you, including any orders for costs and interest in the above mentioned proceedings. We are grateful that you will attend court tomorrow to indicate to the district judge that agreement has been reached on that basis.” (emphasis added) 
	there was a postscript in manuscript:
“This agreement is made on the assumption that no monies have been paid to you since 17th December 1997 and therefore that at that date the sum of £6,928.78 plus interest was due and owing. You also agreed to secure the removal of the caution registered in your favour upon payment of the £6,900.” 
9.	The solicitors meanwhile kept up their sleeve any claim for £5,300 assessed costs of the invoice action until payment had been received under the compromise. Once that had been received they requested payment of the further assessed costs, and when payment was not forthcoming they applied for another charging order in respect of that sum, the precise sum being £5,333.57 which was contained in a charging order nisi obtained by the solicitors ex parte on 17th October 2000.
10.	Payment was resisted by the applicant on a number of grounds. When the matter came on for hearing in relation to the making of the charging order final, it came before Master Turner. He was concerned in particular, (a) that there might be an element of duplication between the sums already the subject of the compromise and paid under the charging order on the one hand, and (b) the invoice action costs of £5,300 on the other. He was also concerned that, in any event, on a proper construction of the compromise, it might be said to extend to the invoice action costs as part of “all liabilities due” to the solicitors.
11.	However, having adjourned the matter to enable preparation of the parties' case on that issue, he later considered the matter on the basis of papers placed before him and satisfied himself that neither was the case. He gave judgment to that effect on 23rd January 2001 and rendered the charging order nisi previously granted absolute. He refused permission to appeal. However, permission was subsequently granted on 20th March 2002 by Buckley J, limited to the question whether the compromise of the charging order proceedings was a global compromise which included the applicant's liability for the solicitors' costs in the invoice action of £5,300-odd.
12.	I have before me now the lengthy and careful ex tempore judgment of Buckley J dated 12th April 2000 when, having heard the applicant's appeal on the point, he concluded that it could not succeed. Having reviewed Master Turner's decision and himself carefully considered all the documents, he concluded):
“I am entirely satisfied that the £5,300 is a debt owed, in addition to the matters that were the subject of the proceedings in the Lambeth County Court; but, more to the point, looking at the history of this matter and at all the circumstances, it is plain to me that there was not what has been referred to as a 'global compromise', and that there is nothing, when one looks at the letters and attendance notes in context, and reads the whole of them -- there is nothing to demonstrate that such an agreement was made, nor even that such an agreement was intended. If Mr Foenander himself subjectively hoped that that was what was being done, that is unfortunate because what one side hopes or subjectively believes is going on, unless it is communicated in some way to the other side, is not going to have any effect as a matter of law.”
13.	I turn to the two applications before me. The first is permission to appeal from the decision of Buckley J on 12th April 2002. Miss Adshead, who has appeared on behalf of the applicant, has made a number of points to me. I do not propose to deal with them or the grounds of appeal individually. A point taken by her in writing and pursued before me was that the judge was in error not to accede to the applicant's request to issue witness summonses against two trainee solicitors to be cross-examined as to internal attendance notes (see grounds 6 and 7). There are two answers to that. The appeal to the judge was by way of review rather than rehearing. It was for him to decide the matter on the basis of the evidence and documents available below, certainly in the absence of exceptional and unexpected circumstances necessitating, in his view, the adducing of further evidence. Secondly, in any event, the matter turned on the objective construction of documents, and in particular the letter from which I have quoted, as to the content of the agreement, rather than upon the unilateral thoughts or intentions of the parties which were not communicated between them. She also suggests in relation to the costs which were originally claimed that there has been a breach of section 69 of the Solicitors Act 1974 (see ground 3). It seems to me, so far as that is concerned, that the essential issue before the court, and the subject certainly of the application with which I now deal, is the question of the compromise which, once reached, would subsume prior matters.
14.	I should also mention, though I think it was rather the subject of an application for an adjournment of the hearing of this application than a substantive ground, that Miss Adshead is concerned that Mr. Foenander is currently awaiting the outcome of an application for information under the Data Protection Act, (a) from the Lambeth County Court, and (b) from the solicitors, as to certain matters which he wishes to explore and believes may assist in the appeal. However, nothing Miss Adshead was able to tell me about the information sought persuaded me that it would have influence upon the issues of which the court will be concerned on any appeal. I therefore did not see fit to grant an adjournment.
15.	Most importantly, however, it is the submission on behalf of Mr. Foenander that the judge erred in his view that the matter had not been settled. There is inevitably some confusion of thought upon the applicant's side as to the relevance of state of mind in relation to the question of whether or not the compromise resulted in settlement. I have been told that Mr. Foenander did not have in mind, or at any rate was not aware of the amount of, outstanding costs in relation to the High Court action, and that so far as he was concerned he wanted there to be a global settlement of all the matters involved. However, of course, he was not the party directly involved in the negotiations. His belief and intentions in that respect were not apparently present to the mind of Mr. De Cruz, and, in any event, could not be of relevance save in so far as there was communication between the two negotiators.
16.	Underlying the enthusiasm of Miss Adshead to apply for cross-examination of one of the trainee solicitors concerned was the opportunity to explore with him whether the matter was intended to be the subject of global settlement, as recorded in an attendance note of Mr. de Cruz in relation to one of the four conversations which occurred between him and the representative of the solicitors negotiating on their behalf, whereas, in the solicitors' attendance ( note, the genuineness of which Miss Adshead questions, though I am not clear on what grounds) no reference appears to such global settlement. Pause to observe that it seems unlikely that it would have done so because all the indications are that the solicitors were lying doggo on the question of the additional costs due until they had procured payment under the charging order.
17.	Having said all that, in my view it is possible that, in examining this matter, the full court might take a different view from that formed by Buckley J. I have to say that I think it is unlikely, but the matter seems to me arguable as a question of the objective construction of the vital letter. The mere fact that the payment under a settlement has been calculated on a particular basis relative to the immediate application being compromised is not, necessarily definitive of which is or not the settlement was intended to be global in effect. The reference to the discharge of “all liabilities due to you, including any orders for costs and interest in the above mentioned proceedings”, coupled with the heading at the top of the letter, might be regarded as apt, in all the circumstances, to apply to any sums due in the proceedings at large rather than simply the application under contemplation. That will be a matter for decision by the full court. I consider that the matter is at least arguable. Accordingly, I would give permission to appeal from the decision of Buckley J in relation to the extent of the compromise. That is ground 4 of the Grounds of Appeal. I do not grant permission on the other grounds.
18.	The second application before me is for permission to appeal the order of Buckley J dated 20th March 2002 in which, by limiting the applicant's permission to appeal to the compromise issue, he refused permission to appeal on a number of grounds which he considered to be without merit, or at any rate not reasonably arguable as grounds of appeal against Master Turner's decision. In that respect Miss Iwi of the Civil Appeals Office has written a letter dated 16th April 2002 to the applicant referring the applicant to CPR 52 PD 4.8, which provides that there is no appeal from a decision of the Appeal Court, made at an oral hearing, to allow or refuse permission to appeal to that court; see section 54(4) of the Access to Justice Act 1999 and rule 52.3(3) and (4), the provisions the subject of the recent decision in the case of Jolly. In this context, the appeal court was Buckley J in relation to an appeal from Master Turner, and there had been an oral hearing involved before his decision. Jolly is an authority which is binding upon me. Therefore I have no power to grant permission to appeal to the full court so far as the making of the charging order final was concerned. The desire for such permission centred upon the applicant's stated concern that, in relation to those costs, he never had notice of the assessment, nor was he of course aware, because the solicitors were not disclosing it, that an assessment had been obtained. If that is indeed true, it is perhaps unfortunate that permission was not granted in that respect for a proper exploration of that issue. It may be that the matter was not made sufficiently clear to the judge at that stage, or that submissions were made or material produced which at that time appeared to indicate that any grounds for complaint in relation to that matter were not substantial. I have not been able to go into that. I do not have jurisdiction to grant permission in that respect.
19.	I should add by way of postscript that Miss Adshead has drawn to my attention a number of matters ostensibly of complaint against the solicitors, the validity of which I am in no position to judge, I can only comment upon the mystery relating to the two orders of 17th December 1997 which have been placed before me, which, mystery is compounded by a copy of the printout records of the Lambeth County Court in the possession of Miss Adshead. I say no more on that topic. If there are complaints concerning the conduct of the solicitors they would be better directed to the Law Society. They are not matters with which this court has jurisdiction to deal.
20.	I would finish by saying that it seems to me that this is a case where it is appropriate for the appellant to seek assistance from the Citizens Advice Bureau in the hope of reference to the bar pro bono unit for the purposes of presenting his arguments and in this respect I direct that a transcript be supplied to the applicant at public expense. The case will plainly not take long in argument. I will make directions that it may appropriately be heard in a court consisting of two Lords Justices with an estimate of two hours.
Order: Application for permission to appeal granted in respect of the extent of the compromise point; case may be heard by two Lords Justice with an estimate of two hours.