Baylis Baxter Ltd v Sabath
Jurisdiction | England & Wales |
Judge | LORD JUSTICE JENKINS,LORD JUSTICE PARKER,LORD JUSTICE PEARCE |
Judgment Date | 16 April 1958 |
Judgment citation (vLex) | [1958] EWCA Civ J0416-1 |
Date | 16 April 1958 |
Court | Court of Appeal |
[1958] EWCA Civ J0416-1
Lord Justice Jenkins,
Lord Justice Parker and
Lord Justice Pearce.
In The Supreme Court of Judicature
Court of Appeal
Mr. D. L. McDONNELL (instructed by Mr. P. Cromwell) appeared on behalf of the Appellants (Plaintiffs).
Mr. A. R. BARROWCLOUGH (instructed by Messrs. Oppenheirmer Nathan & Vandyk) appeared on behalf of the Respondent Defendant).
This is an appeal by the Plaintiffs, a limited company called Baylis Baxter Limited, from a Judgment of Mr. Justice McNair dated 14th June, 1957; and the appeal relates only to the terms of that judgment in regard to costs. The action was an action commenced by specially indorsed Writ for the sum of £1,253. 10s. Od., moneys claimed as due from the Defendant to the Plaintiff company on a running account Kept with the company by the Defendant. The Defendant's defence was to the; effect that his indebtedness on the running account had included loans totalling £2,500 which were made on terms that they were only to be repayable when a claim which the Defendant had, or claimed he had, against the Czech Foreign Compensation Commission in respect of the expropriation of his assets in Czechoslovakia, should have been paid in full, Secondly, the Defendant alleged that he was employed by the Plaintiff company at a salary of £500 a year, and he claimed £1,083. 13s. 4d. as due to him in respect of arrears of that salary; and having paid £169. 6s. 8d. to the Plaintiff company after action brought he said that there was nothing due to them because the balance of £1,083. 13s. 13s. represented the arrears of salary claimed by him to be due to himself from the Plaintiff company, for which amount he entered a counterclaim.
At the conclusion of the hearing, the learned Judge found for the Plaintiff company both on the claim and on the counterclaim. That meant that he gave judgment in favour of the Plaintiffs for the £1,083. 13s.4d., representing the balance dua (according to the Plaintiff company) after allowance had been made for the payment of the £169. 6s. 8d. since action brought. But although the learned Judge held the Plaintiff company entitled to succeed, he held that no Order should be made as to costs. It is contended for the Plaintiff company that the learned Judge erred in dealing with the costs in that way and that there was no sufficient reason for departing from the ordinary rule that costs should follow the event.
The details of the action and the relationship between the parties are somewhat complicated, but it is not necessary to go into them at any length for the purposes of this appeal. The history of the matter involves two companies, namely, the Plaintiff company itself and another company called British Overseas & Export Trading Company, Limited. The businesses of these companies were associated, and the moving spirit behind them (if I may so describe him) was a Mr. Otto Popper. The Defendant was employed by one or other or both of these companies on terms which I need not attempt to define with precision. The Defendant apparently had a drawing account with both companies. It seems that the £2,500 to which I have referred was originally advanced by the British Overseas & Export Trading Company Limited, which apparently also advanced to the Defendant a further sum of £1,200. It appears that these suras were subsequently transferred to the debit of the Defendant's drawing account with the Plaintiff company by means of a payment in account by the Plaintiff company to the British Overseas & Export Trading Company Limited cf the appropriate amount. The substantial issues in the case were: first, whether the loan of £2,500, to which I have referred, was made on the condition I have mentioned, to the elffeet that it was only to be repayable on payment of the Defendant's claim against the Foreign Compensation Commission; and secondly, whether, as the Defendant claimed, he was employed by the Plaintiff company at a salary of £500 a year, the allegation that he was so employed being the basis of his counterclaim for £1,083. 13s. 4d. But the first issue, as I have stated fct, was complicated by the fact that the Plaintiffs alleged, and sought to prove, not merely that the loan was made without the condition relied on by the Defendant, but that the loan was never in fact made at all; and the Plaintiffs further alleged and sought to prove that there was no transfer of the amounts owing to the British Overseas & Export Trading Company Limited from the Defendant with the assent of either of the companies or of Mr. Popper, as I understand it.
Now the learned Judge, on the issue as to the £2,500 loan, wholly rejected Mr. Popper's evidence to the effect that there was no loan at all; and he also wholly rejected Mr. Popper's evidence that there was no transfer of this indebtedness to the Plaintiff company; but he found in favour of the Plaintiff company on this issue on the ground that the bargain included nothing amounting to a legally binding condition to the effect that the liability to repay was only to arise when the Defendant's claim against the Foreign Compensation Commission should have been met. On the other hand, the learned Judge rejected the Defendant's evidence in regard to his employment by the Plaintiff company at the salary of £500 a year; and, speaking generally, he attached little weight or credibility to the evidence of Mr. Popper, and likewise attached little weight or credibility to the evidence of the Defendant.
We were referred, in the course of the argument, to the greater part of the Judgment and to the criticisms made by the learned Judge of the evidence tendered on either side. I think I have sufficiently stated the main matters on which the learned Judge rejected the evidence, and I need only refer to that part of the Judgment which deals with the question of costs. Mr. Justice McNair, at page 15 of the transcript, said this: "As regards costs, Mr. McDonnell, I have formed a view unfavourable to your clients" - that is, the Plaintiff company — "as regards the evidence of Mr. Popper, which I have expressed in the course of ray Judgment, and I think that should be reflected in the matter of costs. I have in mind to say that there should be no costs eithei way. I propose to say Judgment to be entered for the sum indicated without costs in view of the impression I have formed as to Mr. Popper's evidence". Then Mr. McDonnell said: "Might I address your Lordship on that? Your Lordship has formed a no more favourable view of the evidence of the Defendant. In my respectful submission the unfavourable view that your Lordship has formed of both Mr. Popper and Mr. Sabath should cancel each other out. In my submission the proper order would be the usual one that, as the Plaintiff has succeeded —" — and then the learned Judge said "The Plaintiffs have not succeeded by reason of any evidence they have brought before me". Then Mr. McDonnell said: "They have succeeded in this sense, with respect, my Lord, that a dispute having arisen between the parties and unsatisfactory evidence having been given on behalf of the Plaintiffs and by the Defendant, the Plaintiffs' Claim is found to be well-founded, and in these circumstances I would submit that you should not differ from the usual result that costs should follow". Then Mr. Justice McNair said: "That is the usual result when a claim is supported "by honest evidence".
That is how the matter was left by the learned Judge. An application was made to him for leave to appeal, which was refused; and, in the circumstances I have stated, Mr. McDonnell, for the Plaintiff company, now invites us to hold that we should entertain this appeal and should conclude that the learned Judge was in error in making rao Order as to costs and should have given the Plaintiff company their costs of the action and of the counterclaim.
Mr. McDonnell is met at the outset with certain statutory difficulties arising under the Judicature Act, 1925, I should first refer to section 50, which provides, in sub-Bection 1: "Subject to the provisions of this Act and to rules of court and to the express provisions of any other Act, the costs of and incidentrl to all proceedings in the Supreme Court, shall be in the discretion of the court or Judge, and the court or judge shall have full power to determine by whom and to what extent the costs are to be paid."
The other section of the Act to which I should refer is section 31; but before doing that I should mention Order 65 Rule 1 of the Rules of the Supreme Court, That rule provides: "Subject to the provisions of the Act and these Rules, the costs of and incident to all proceedings in the Supreme Court, shall be in the discretion of the Court or Judge…."
If the matter rested there, Mr. McDonnell would be faced with the difficulty usually attendant upon an appeal against a decision arrived at by a Judge in exercise of some discretionary jurisdiction vested in him. But the matter does not rest there, for section 31 of the Act provides, by sub-section 1, "No appeal shall lie" — then there are a number of lettered sub-paragraphs, and, in particular, sub-parugraph (h), "without the leave of the court or judge making the order, from an order of the High Court or any judge thereof made with the consent of the parties or as to costs only which...
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