Bourne v Colodense Ltd
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE LAWTON,LORD JUSTICE GRIFFITHS,LORD JUSTICE DILLON |
| Judgment Date | 23 January 1985 |
| Judgment citation (vLex) | [1985] EWCA Civ J0123-2 |
| Docket Number | 85/0011 |
| Court | Court of Appeal (Civil Division) |
| Date | 23 January 1985 |
[1985] EWCA Civ J0123-2
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
(SIR NEIL LAWSON)
Royal Courts of Justice
Lord Justice Lawton
Lord Justice Griffiths
Lord Justice Dillon
85/0011
MR. J. C. N. SLATER and MR. J. G. S. WAITE (instructed by Messrs. Kennedys) appeared for the Appellants.
MR. S. J. SEDLEY Q.C. and MR. P. H. NORRIS (instructed by Messrs. O. H. Parsons & Partners) appeared for the Respondents.
On 19th February 1978, after a trial which lasted 42 days, Thompson J. gave judgment for the defendants, Colodense Limited, against the plaintiff with costs which were taxed at £50,841.67. The plaintiff has not paid them. With interest the amount now owing by the plaintiff is about £79,000. He is elderly and sick and has no assets. Neither execution nor bankruptcy would produce anything for the defendants. Since the litigation had been financed by the plaintiff's Union, the National Society of Operative Printers Graphical and Media Personnel (NATSOPA, now known as SOGAT 82), the defendants believed that the plaintiff had been given to understand by his Union that they would indemnify him against any order for costs which might be made against him. They made such enquiries as they could about the circumstances in which the Union had decided to finance the plaintiff's litigation. On the information which they got together, pursuant to section 37(1) of the Supreme Court Act 1981 and Order 30 of the Rules of the Supreme Court, they applied to Master Grant on 17th June 1982 for a Receiver to be appointed by way of equitable execution "in respect of the plaintiff's interest in the following personal property, the chose in action to which he is entitled, namely to bring proceedings against the National Society of Operative Printers Graphical and Media Personnel to claim an indemnity in respect of an undertaking given by the said society to the plaintiff or to claim damages for breach of an agreement between the said society and the plaintiff and to have liberty to take in the name of the plaintiff any such proceedings as may be necessary to realise the plaintiff's said chose in action in or towards satisfaction of the taxed costs and interest due to the defendants under the order of Mr. Justice Thompson in this action dated 19 February 1979…" On 21st June 1982 Master Grant made the order. The plaintiff, once again financed by the Union, appealed to the judge at chambers, Sir Neil Lawson sitting as a Deputy High Court Judge. On 24th October 1983 he discharged the order. The defendants have appealed to this court.
The question which we have had to decide is this: whether, on the affidavit evidence and the documentary exhibits (which included the Union's rules at the material time) the defendants have shown that the plaintiff can establish against the Union a prima facie case entitling him to an indemnity in respect of the order for costs made against him. If so, the order made by Master Grant stands. The Receiver can then take what action he thinks proper to make the Union pay; and, in any proceedings he may take against the Union, they can raise whatever defences they may think are available to them. The experienced counsel whom they made available to the plaintiff did no more than put forward his submissions as to what he thought was the Union's position in law.
The story starts over a decade ago. The plaintiff and a number of other members of the Union were employed in the printing shop of the defendants' factory at Bristol. The defendants are a subsidiary of Courtaulds Limited. Before 1973 the plaintiff and others working in that shop began to develop persistent coughs and other kinds of bronchial ailments. They believed that these ailments were caused by the defendants' negligent use of a toxic substance called tolylene di-isocyanate which got into the factory atmosphere. On 1st June 1973 the plaintiff applied to his Union for assistance in obtaining compensation from his employers. He signed an authority in these terms:
"I hereby apply to the National Society of Operative Printers Graphical and Media Personnel for assistance in obtaining such compensation or other relief as I may be entitled to in respect of the injury and damage referred to above and I hereby authorise the Society and any solicitor whom they see fit to instruct to act on my behalf. I undertake not to discuss or settle my case or to have any dealings with my employers or their insurance company in connection with it, without the consent of the Society or that of the Solicitor nominated by the Society to act on my behalf".
The Union were concerned about the welfare of their members in the printing shop of this factory. In 1973 they started negotiations with the defendants and Courtaulds Limited about the working conditions there. About this time the defendants stopped using this toxic substance but the Union wanted to ensure that any of their members who had suffered from its use were paid compensation. Courtaulds Limited resisted the claims on two grounds, first, that the defendants had not been negligent in their use of this substance and, secondly, that, in some of the cases (but not that of the plaintiff), there was no satisfactory evidence that it had caused the ailments of which complaint was made. The negotiations went on until 1976. In 1975, the Union's solicitor, Mr. O. H. Parsons, was consulted by the Union. He had discussions and correspondence about the claims with members of Courtaulds Limited's legal department. In a letter dated 16th July 1975 he referred to the Union as "the Society instructing me". In a letter dated 18th November 1975 he wrote: "Quite frankly I think the Society and I are being treated very unfairly in this matter. I am reporting the situation to them". By letter dated 24th November 1975 he wrote: "In view of your attitude I am proceeding to court with all the outstanding cases". In a letter dated 9th December 1975 he referred to his "trade union clients" and reporting "to the union instructing me".
On 19th March 1976 Mr. Parsons issued writs on behalf of the plaintiff and eleven other members of the Union employed in the defendants' printing shop. On 22nd March 1976 the Union's then general secretary wrote to the chairman of Courtaulds Limited in these terms: "In the circumstances, it seems to me I have no alternative but to take the matter to our Executive Council at their next meeting and take appropriate legal steps to safeguard the position of our members. We have been most conciliatory, perhaps too conciliatory."
The inference I draw from these facts is that, when the writs were issued, the Union were concerned, and rightly concerned, to use litigation for the purpose of getting compensation for all their members whose health they thought had been damaged as a result of working in what was believed to have been a polluted atmosphere. The Union as such were putting the law in motion. When Mr. Parsons issued the twelve writs, he would, I am sure, have expected the Union to pay his fees. At a meeting of the Executive Council held in May 1976, a minute was recorded in these terms:
"LEGAL: COLODENSE LIMITED
General Secretary reported a situation which had arisen at this company were eleven members were all suffering from respiratory troubles as a result of contact and inhalation of T.D.I. (the toxic substance). The company were denying that T.D.I. was responsible and varying medical opinions were available.
"Our Solicitor advised that despite the difficulties we should take legal action to protect our members' rights. Authority recorded for appropriate legal action to be taken, the matter also being left in the General Secretary's hands to initiate industrial action at the appropriate time."
In July 1977 a summons for directions was issued in the plaintiff action. An order was made in the following terms:
"There be leave to treat for the purposes of setting down only as though this action be consolidated with actions numbers" Then followed the numbers of all the other actions.
This was a sensible order to make since a decision in the plaintiff's case, on which the sole issue was negligence, not causation, would have narrowed the issues to be tried in the other cases if they had to be tried and would have saved the Union, who were financing all the actions, considerable expense. The plaintiff's claim was going to be treated as a test case.
The trial of the plaintiff's claim started on 20th November 1978. Judgment was given for the defendant on 19th February 1979. The transcript finishes as follows:
"Mr. Beldam (Counsel for the defendants): My Lord, I respectfully ask that judgment may be entered for the defendants against the plaintiff. I understand that the plaintiff has brought his action with the backing of his union. In those circumstances, I ask for the costs of these proceedings.
Mr. Justice Thompson: I think it has been clear he has had the backing of the union. Mr. Hampden Inskip (Counsel for the plaintiff) keeps his seat so I make the order as asked. It follows the event, Mr. Inskip."
Thereafter, the defendants' solicitors prepared a bill of costs for taxation. Mr. Parsons put in objections to this bill. There was a hearing before the taxing master. Some of the objections were allowed. The costs of the hearing were awarded to the defendants. The taxing master's certificate was issued.
The defendants' solicitors applied to Mr. Parsons for payment of the certified amount. They did so in the expectation that the Union would put him in funds to pay. It was accepted in this...
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