Ayela v London Borough of Newham
| Jurisdiction | England & Wales |
| Judge | MR JUSTICE SWEENEY,Mr Justice Sweeney |
| Judgment Date | 19 February 2010 |
| Neutral Citation | [2010] EWHC 309 (QB) |
| Date | 19 February 2010 |
| Court | Queen's Bench Division |
| Docket Number | Case No: CC/2009/APP/0435 |
[2010] EWHC 309 (QB)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ON APPEAL FROM CENTRAL LONDON COUNTY COURT OF THE ORDER OF HHJ BAILEY 5 th June 2008
Before: Mr Justice Sweeney
Case No: CC/2009/APP/0435
Mr Van Staden appearing as a McKenzie Friend for the Appellants
Mr Skelly (instructed by Newham Legal Services) for the Respondent
Hearing dates: 30 th October 2009
Approved Judgment
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
Mr Justice Sweeney:
Introduction.
This is an appeal by permission of Stadlen J, against a decision of His Honour Judge Bailey who, on 5 June 2008, in the Central London County Court refused applications by the Appellants to set aside judgments in default of appearance entered against them by His Honour Judge Collender QC, also in the Central London County Court, on 14 May 2008.
Stadlen J gave permission to appeal against Judge Bailey's conclusion that the Appellants had no reasonable prospects of success at trial on two grounds, namely that there were reasonable prospects of success because:—
i) The Respondent had waived its right to forfeiture.
ii) Discretionary relief should be granted to the Appellants on the basis that their breach of unpaid rent arrears was caused by the Respondent's defective Rent Collection/Billing System.
Stadlen J further ordered that the Appellants’ application to rely on fresh evidence should be heard at the hearing of the Appeal.
In addition the Respondent seeks leave to cross appeal Judge Bailey's ruling that the Appellants had a good reason for not attending court on 14 May 2008.
Background.
The Respondent owns commercial premises situated at, and known as, Rathbone Market London E16.
In 2004 (the precise dates are in dispute) each Appellant entered into a lease for the occupation of shop premises, respectively at 15/15a Rathbone Market (Mrs Ayela) and 23/23a Rathbone Market (Mrs Kalley). Each Appellant asserts that, by agreement with the Respondent, she had been permitted occupation since 2003.
The leases were for terms expiring respectively on 28 August 2005 and 30 August 2005. According to the Pleadings, at least, it was not in dispute that the leases were contracted out; that they were at an annual rent of £5,900 and £5,000 respectively, each payable quarterly in advance; that the term was expressed in each lease to include any period of holding over or extension, whether by statute, common law or agreement; and that each lease contained a proviso enabling the Respondent to forfeit and to re-enter the premises in the event of rent being unpaid for 21 days after a due date, whether formally demanded or not.
Whilst it is unnecessary to go into the detail, it is clear from the Pleadings that the state of the respective shop premises during the period of occupation, who was responsible for that state, and also for its rectification, was in considerable dispute between the parties. It is also clear that, eventually, both Appellants stopped paying rent.
It seems that, after the terms of the respective leases expired, the parties were in negotiation for the grant of new fixed term leases, which were (again) to be contracted out. According to the Respondent, these negotiations were subject to conditions, including the need to ensure that all rental payments were up to date.
In the end, the negotiations did not come to fruition, and on 14 August 2007 the Respondent peaceably re-entered both premises, and sought to forfeit both tenancies upon the basis of substantial rent arrears.
On 30 August 2007, before District Judge Millard in the Bow County Court, the Appellants obtained ex-parte injunctions to be re-instated, having argued that since termination of the contracted out leases two years before, the Respondent had allowed them to remain in occupation, but had failed to open a new rent account. A return date of 24 September 2007 was ordered, as was the joinder of the Appellants’ cases with that of a Mr Andre Ntenda who was the former occupier of the premises at 25/25a Rathbone Market.
The return date hearing duly took place before His Honour Judge Hornby in the Bow County Court. He ordered that Mr Ntenda and the Appellants should be permitted to re-enter and to resume occupation of their respective premises by noon on 25 September 2007, upon condition that they each made specified weekly payments into court for such use and occupation, commencing on 15 October 2007.
In case of any failure to agree to mediation, the learned Judge set down a detailed timetable leading to a Multi Track Trial on the first open date after 3 March 2008 at the Central London County Court.
The Appellants were required to serve Particulars of Claim by 8 October 2007, but failed to do so. On 19 October 2007 the Respondent issued an application to strike out both claims. Four days later, the Respondent received the Appellants’ amended Particulars of Claim. Each asserted that they had suffered significant financial loss as a result of the conduct of the Respondent, and also sought relief against forfeiture.
In due course, a trial date of 12 and 13 March 2008 was fixed. However, due to errors by the Court, the Respondent's application to strike out was not heard until a Case Management Conference was held before His Honour Judge Mitchell in the Central London County Court on 4 March 2008. Both the first Appellant, and the second Appellant's husband were amongst those who addressed the court. As to the application to strike out, the learned Judge indicated that, but for the delay by the Court, the application would probably have succeeded. However, given the delay, he had no choice but to disallow it.
The parties agreed to consider mediation. Given that indication, the learned Judge vacated the trial date. However, he set down a very detailed timetable, including default provisions relating only to the Appellants, leading to a new trial date of 14 and 15 May 2008. These directions included an order that the Appellants lodge and serve a trial bundle not less than 3 days before the start of the trial.
On 14 March 2008 the Respondent lodged a Defence and Counterclaim. The Counterclaim sought a declaration that the Respondent had been entitled to re-enter on 14 August 2007, possession of the premises, arrears of rent, and mesne profits until delivery up of possession.
A Reply to Defence and Counterclaim was lodged by the Appellants in early April 2008.
The Respondent asserts that, in the run up to the trial, its solicitor gave the Appellants her proposals for the trial bundle, and some advice as to how each should be prepared.
The case was duly listed for trial before His Honour Judge Collender QC in the Central London County Court on the fixed date of 14 May 2008. Mr Ntenda attended. The Appellants did not. In the result, the learned Judge dismissed the Appellants’ claims, and gave judgment for the Respondent on its counterclaims. Mr Ntenda and the Respondent eventually reached an accommodation.
On 20 May 2008 the Appellants applied to set aside Judge Collender's order, upon the basis that they were not aware that a hearing was being held as they had never received any order from the court to notify them of it.
On 5 June 2008 the applications were heard by His Honour Judge Bailey in the Central London County Court. The learned Judge treated a document before him entitled “Appellant's Statement of Issues” as the Appellants’ evidence. In the result, the applications were dismissed. The learned Judge gave written reasons in the following terms:—
“The relevant rule is at CPR 39.3(5):
a) The Claimants certainly acted promptly
b) Their reason for not attending trial was that they did not appreciate that the trial would take place that day. It is the case that they did not receive a separate notification of the trial date from the court. However at the application that each of the claimants attended on 4 th March 2008 Judge Mitchell ordered that ‘All the claims and any counterclaims shall be listed on 14 and 15 May 2008 (2 day time estimate)’. Both claimants accept that they heard Judge Mitchell say this, and that they received a copy of a draft Minute of Order prepared by Defendant's counsel reciting this part of the Judge's order by e-mail later that day, 4 th March 2008. They also told me that Judge Mitchell had told them to ‘keep these two days free’. However they said that they thought that ‘listed for trial’ meant that the trial date would be fixed on 14 and 15 May, not that the case would be heard then. They made the point that no time was specified. They had no clear idea why they needed to keep two days free for this purpose but told me that they did so and that on 14 May they were simply doing nothing at their respective homes. They also told me that Mr Kalley received a telephone call on the morning of 14 th May from the 3 rd claimant suggesting that they may have to go to court that day. However they said that the 3 rd claimant was to let them know if they were needed. In the event the 3 rd claimant did go to court, and he left a message on Mr Kalley's phone to say that he should come to court. However Mr Kalley did not retrieve that message until 2.00pm.
This is not impressive. However Judge Mitchell had made a series of orders for pleading disclosure witness statements and pre trial checklists which the claimants had (substantially) complied with. Further Mrs Ayela had twice written to the Defendant's...
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