Andrews v Schooling
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE BALCOMBE,LORD JUSTICE BELDAM,SIR DENYS BUCKLEY |
| Judgment Date | 21 March 1991 |
| Judgment citation (vLex) | [1991] EWCA Civ J0225-6 |
| Docket Number | 91/0138 |
| Court | Court of Appeal (Civil Division) |
| Date | 21 March 1991 |
[1991] EWCA Civ J0225-6
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
JUDGE IN CHAMBERS
MR. GARETH WILLIAMS Q.C.
(Sitting as a Deputy High Court Judge)
Royal Courts of Justice
Lord Justice Balcombe
Lord Justice Beldam
and
Sir Denys Buckley
91/0138
and
MR. ANDREW GORDON-SAKER (instructed by Messrs Weight Wolny & Trusler, Chelmsford) appeared on behalf of the Appellants (Defendants).
MR. GRAHAM HULME (instructed by Messrs Alison Trust & Co.) appeared on behalf of the Respondent (Plaintiff)
From April to August 1986 the first and second defendants were the freehold owners of adjacent Edwardian semi-detached houses at 204 Highview Avenue, Grays, Essex. On 14th August 1986 the freehold of these properties was transferred to the third defendant, a company of which the first and second defendants were directors. Works to convert the properties into flats were undertaken by the third defendant through sub-contractors. Such works commenced before 14th August 1986, i.e., during the period when the first and second defendants were owners. On 7th May 1987 the third defendant granted to the plaintiff a 199 year lease of flat 4, No. 2 Highview Avenue, at a premium of £42,500. The plaintiff had a one hundred per cent mortgage to enable her to pay for that premium. Flat 4 is on the ground floor of the property and includes a cellar. Before the grant of the lease a survey of the flat was carried out by the fourth defendant, a firm of surveyors.
The plaintiff's case is that the flat suffers from penetrating dampness emanating from the cellar. The first to third defendants admit that they carried out extensive works to the flat itself, but say that the only work they carried out to the cellar was painting the walls.
On 30th June 1987 the plaintiff issued a specially endorsed writ in the Queen's Bench Division of the High Court. Against the first to third defendants the plaintiff claims damages under three heads:
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(1) Breach of duty under section 1 of the Defective Premises Act 1972.
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(2) Common law negligence.
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(3) Misrepresentation arising out of a reply to a pre-contract enquiry.
The plaintiff also claims damages against the fourth defendants for negligence and breach of contract.
All defendants have served defences denying liability.
On 3rd November 1989 the plaintiff issued a summons claiming summary judgment under Order 14, alternatively an interim payment in respect of damages under Order 29, rule 11. That summons came on for hearing before Master Prebble on 15th February 1990. As against the fourth defendant the application for summary judgment was withdrawn at the hearing, that defendant having at the last minute produced an expert's report.
As against the first to third defendants the plaintiff did not seek to rely on misrepresentation as a ground for either summary judgment or interim payment. She relied on her claim under the 1972 Act and on common law negligence. The Master granted all four defendants unconditional leave to defend and made no order on her application for interim payment.
The plaintiff appealed against the Master's order in so far as he did not order interim payment. She withdrew her appeal against the fourth defendant on the day before the hearing of that appeal. The fourth defendant plays no further part in the present story.
The plaintiff's appeal was heard on 13th March 1990 by Mr. Gareth Williams Q.C. (sitting as a Deputy High Court Judge in Chambers). As I have said, there was no appeal against Master Prebble's order giving the defendants unconditional leave to defend. Unfortunately the judge was not referred to the decision of this court in British and Commonwealth Holdings v. Quadrex [1989] Q.B. 842. In order to understand the significance of that omission, I should first state the relevant provisions of Order 29, rule 11(1)(c). That reads as follows:
"If, on the hearing of an application under rule 10 in an action for damages, the Court is satisfied—…
(c) that, if the action proceeded to trial, the plaintiff would obtain judgment for substantial damages against the respondent, or where there are two or more defendants, against any of them,
the Court may, if it thinks fit,…, order the respondent to make an interim payment of such amount as it thinks just, not exceeding a reasonable proportion of the damages which in the opinion of the Court are likely to be recovered by the plaintiff…"
I now read paragraph (5) of the head-note in the Quadrex case:
"That before the court could make an order for an interim payment of damages to the plaintiff under Order 29, it had to be satisfied that the plaintiff would obtain judgment for substantial damages; that where unconditional leave to defend had been granted a court could not be so satisfied and an order for an interim payment was impossible; but that, where a court had only granted conditional leave to defend in circumstances where it doubted the genuineness of the defence, it could be satisfied that the plaintiff would succeed at the trial;…"
Unfortunately, in ignorance of that decision, the deputy judge applied the wrong test. I refer to his judgment at page 16 of the core bundle, where he said this:
"Can the plaintiff satisfy me that (1) the plaintiff is likely to succeed and (2) what damages are likely to be recovered and (3) what is a reasonable proportion, just vis-a-vis the plaintiff and the defendants?"
"Likely to succeed" is not enough, and again I refer back to the Quadrex case and the judgment of Sir Nicolas Browne-Wilkinson V.-C. at pages 865–6:
"…But order 29 (as construed by this court in the Shearson Lehman case [1987] 1 W.L.R. 480) requires the court, at the first stage, to be satisfied that the plaintiff will succeed and the burden is a high one: it is not enough that the court thinks it likely that the plaintiff will succeed at trial".
The judge went on to find that he was satisfied that the plaintiff was likely to succeed in her claim under the 1972 Act (although he was not so satisfied in respect of her claim in negligence) and he ordered an interim payment in the sum of £7,500 for which the first to third defendants were to be jointly and severally liable. The judge then granted the first to third defendants leave to appeal against his order. Those defendants have so appealed and it is that appeal which is now before us.
Fortunately our task has been made much easier by some sensible concessions made by the plaintiff. Mr. Hulme has conceded:
First, that the decision in Quadrex is binding and that the test under Order 29 is more stringent than that adopted by the judge. In particular he accepts that it is inconsistent to order an interim payment at the same time as an order giving unconditional leave to defend still stands. Accordingly at the outset of this appeal he applied for leave to appeal out of time against Master Prebble's order granting the first three defendants unconditional leave to defend. Had the Quadrex decision been relied on by the defendants at the hearing before the judge, I have no doubt that the plaintiff would then have applied for and been granted leave to appeal out of time against the order granting them unconditional leave to defend. The defendants made it clear in their skeleton argument that they did intend to rely on Quadrex before us. In the circumstances we granted the plaintiff leave to appeal out of time against that order, and treated that appeal as also before us so that we could deal with the matter on its merits and not just on a technicality.
The second concession made by Mr. Hulme was that we could not be satisfied at this stage that the plaintiff would succeed in her claim so far as it was based on negligence at common law.
Thirdly, he accepted that since the judge had exercised his discretion on a wrong basis the discretion is now ours. So the issue before us came down to this. Are we satisfied that the plaintiff will succeed at the trial in her claim based under the 1972 Act and that the defence is so shadowy that the defendants should only be given conditional leave to defend, the condition being an interim payment to the plaintiff? As the Vice-chancellor said in Quadrex at page 866, there is little merit for the sum to be paid into court rather than to the plaintiff, who in this case needs it to help finance the work necessary to make her flat habitable.
The case before us falls under three heads:
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(1) As a matter of law, does the 1972 Act apply to a case of non-feasance, or does it apply only to a case of misfeasance?
It is common ground that the defendants did no relevant work to the cellar.
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(2) If the Act does apply, are the facts sufficient to establish liability on the part of the defendants?
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(3) If both heads (1) and (2) are satisfied, what should be the amount of the interim payment?
The first point then is the construction of the Defective Premises Act 1972, the relevant section of which is section 1:
"(1) A person taking on work for or in connection with the provision of a dwelling (whether the dwelling is provided by the erection or by the conversion or enlargement of a building) owes a duty—
(a) if the dwelling is provided to the order of any person, to that person: and
(b) without prejudice to paragraph (a) above, to every person who acquires an interest(whether legal or equitable in the dwelling;
to see that the work which he takes on is done in a workmanlike...
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