Celador Radio Ltd v Rancho Steak House Ltd
| Jurisdiction | England & Wales |
| Judge | Master Victoria McCloud |
| Judgment Date | 16 February 2018 |
| Neutral Citation | [2018] EWHC 219 (QB) |
| Court | Queen's Bench Division |
| Docket Number | Claims No. D96YJ258 & D920X446 |
| Date | 16 February 2018 |
and
[2018] EWHC 219 (QB)
Master Victoria McCloud
Claims No. D96YJ258 & D920X446
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Keywords
Equitable Interpleader — Enforcement — controlled goods — interpleader — equity — common law — Civil Procedure — Rules of Supreme Court — title to goods — third party — Writ — High Court
Enforcement Officers
Unusually I am producing a written judgment on two enforcement applications made to me on paper, and I do so because it has been drawn to my attention by High Court Enforcement Officers that there is a difficulty with the current court rules relating to enforcement, in the circumstances of these cases and others like them, and that it would assist HCEOs to have a decision as to the proper steps to take when faced with the situation arising here, which I suspect is not a rare one.
In the relatively recent past an enforcement officer executing a Writ of fi. fa. would conventionally ask the court to determine any issue of ownership by way of an interpleader summons if there were rival claims to the seized goods. Those were summonses of a sort which junior barristers would cut their teeth on if they went to trial. These days, instead, we have the Civil Procedure rules with rather more bland language but, one would hope, aimed at solving much the same problems as have always arisen in the course of execution whether before or after the advent of the CPR. Nowadays the nearest we seem to have are Rules 85.4 and 85.5 of the CPR “Procedure for making a claim to controlled goods”.
As its title suggests, it places emphasis on the person who is asserting the rival claim to title of the seized (‘controlled’) goods. This is somewhat different from the conventional interpleader where the party playing ‘piggy in the middle’ – typically the enforcement officer – would apply to court to resolve the question of title.
Nowadays, then, the CPR provide a mechanism whereby the person who claims he or she owns the goods is the person making the application to the court. The Rules say:
Procedure for making a claim to controlled goods 85.4
(1) Any person making a claim under paragraph 60(1) of Schedule 12 must, as soon as practicable but in any event within 7 days of the goods being removed under the exercise of an enforcement power, give notice in writing of their claim to the enforcement agent who has taken control of the goods (‘the notice of claim to controlled goods’) and must include in such notice—
(a) their full name and address, and confirmation that such address is their address for service;
(b) a list of all those goods in respect of which they make such a claim; and
(c) the grounds of their claim in respect of each item.
(2) On receipt of a notice of claim to controlled goods which complies with paragraph (1) the enforcement agent must within 3 days give notice of such claim to—
(a) the creditor; and
(b) any other person making a claim to the controlled goods under paragraph (1) (‘any other claimant to the controlled goods’);
(3) The creditor, and any other claimant to the controlled goods, must, within 7 days after receiving the notice of claim to controlled goods, give notice in writing to the enforcement agent informing them whether the claim to controlled goods is admitted or disputed in whole or in part.
(4) The enforcement agent must notify the claimant to the controlled goods in writing within 3 days of receiving the notice in paragraph (3) whether the claim to controlled goods is admitted or disputed in whole or in part.
(5) A creditor who gives notice in accordance with paragraph (3) admitting a claim to controlled goods is not liable to the enforcement agent for any fees and expenses incurred by the enforcement agent after receipt of that notice by the enforcement agent.
(6) If an enforcement agent receives a notice from a creditor under paragraph (3) admitting a claim to controlled goods the following applies—
(a) the enforcement power ceases to be exercisable in respect of such controlled goods; and
(b) as soon as reasonably practicable the enforcement agent must make the goods available for collection by the claimant to controlled goods if they have been removed from where they were found.
(7) Where the creditor, or any other claimant to controlled goods to whom a notice of claim to controlled goods was given, fails, within the period mentioned in paragraph (3), to give the required notice, the enforcement agent may seek—
(a) the directions of the court by way of an application; and
(b) an order preventing the bringing of any claim against them for, or in respect of, their having taken control of any of the goods or having failed so to do.
Procedure for making a claim to controlled goods where the claim is disputed 85.5
(1) Where a creditor, or any other claimant to controlled goods to whom a notice of claim to controlled goods was given, gives notice under rule 85.4(3) that the claim to controlled goods, or any part of it, is disputed, and wishes to maintain their claim to the controlled goods, the following procedure will apply.
(2) The claimant to controlled goods must make an application which must be supported by—
(a) a witness statement—
(i) specifying any money;
(ii) describing any goods claimed; and
(iii) setting out the grounds upon which their claim to the controlled goods is based; and
(b) copies of any supporting documents that will assist the court to determine the claim.
(3) In the High Court the claimant to controlled goods must serve the application notice and supporting witness statements and exhibits on—
(a) the creditor;
(b) any other claimant to controlled goods of whom the claimant to controlled goods is aware; and
(c) the enforcement agent.
(4) In the County Court when the application is made the claimant to controlled goods must provide to the court the addresses for service of—
(a) the creditor;
(b) any other claimant to controlled goods of whom the claimant to controlled goods is aware; and
(c) the enforcement agent,
(‘the respondents’), and the court will serve the application notice and any supporting witness statement and exhibits on the respondents.
(5) An application under paragraph (2) must be made to the court which issued the writ or warrant conferring power to take control of the controlled goods, or, if the power was conferred under an enactment, to the debtor's home court.
(6) The claimant to controlled goods must make the required payments on issue of the application in accordance with paragraph 60(4)(a) of Schedule 12, unless such claimant seeks a direction from the court that the required payment be a proportion of the value of the goods, in which case they must seek such a direction immediately after issue of the application, on notice to the creditor and to the enforcement agent.
(7) The application notice will be referred to a Master or District Judge.
(8) On receipt of an application for a claim to controlled goods, the Master or District Judge may—
(a) give directions for further evidence from any party;
(b) list a hearing to give directions;
(c) list a hearing of the application;
(d) determine the amount of the required payments, make directions or list a hearing to determine any issue relating to the amount of the required payments or the value of the controlled goods;
(e) stay, or dismiss, the application if the required payments have not been made;
(f) make directions for the retention, sale or disposal of the controlled goods;
(g) give directions for determination of any issue raised by a claim to controlled goods.
Para 60(1) of Sch. 12 to the Tribunals, Courts and Enforcement Act 2007 specifically relates to claims by a person who says he or she is entitled to the goods. That therefore does not include an enforcement officer. Hence the framework in rules 85.4 and 85.5 applies to the person who asserts the claim over the controlled goods. Essentially, he or she must give the notice required under r. 85.4(1) and then, if the claim is disputed the creditor or any other party with a claim to the goods must give the notice referred to in r. 85.4(3).
If the creditor or other claimant to the goods fails to give the notice required by 85.4(3), the HCEO may apply to the court for a directions as to what to do and for protection against liability.
We then see that where a notice is given under 85.4(3), the party claiming the goods must issue an application to the court for determination, under r. 85.5.
The problem, however, is that the rules omit to deal with the situation where a third party has given notice that they believe they are entitled to the goods, under r. 85.4(1), and a counter-notice is duly given by the creditor under r. 85.4(3), but the third party then fails to commence the application to the court which is required under r. 85.5. There is no provision in those circumstances for what steps must be taken by the HCEO who is holding the goods.
Furthermore the provisions of rule 85.5 impose no time limit by which the application under that rule must be made by the creditor or other party claiming an interest. Hence there is no clear point at which the rule has been breached, and no provision within the rule for what should happen when no application is made.
I think with all respect to the draftsperson, the rule must be said to be deficient. It is silent as to those aspects and perhaps ought not to be. The HCEO cannot release the goods or dispose of them but may well be storing them at cost. The purpose of swift enforcement is thereby frustrated, and costs and expense wasted. Court time can be taken because on an ad hoc basis the HCEOs attend court seeking local solutions from...
To continue reading
Request your trial
-
Thomas Banks Hamilton v Secretary of State for Business, Energy and Industrial Strategy
...Part 7 claims. 114 CPR 85.4 is not without its own difficulties. In Celador Radio Ltd v Rancho Steak House Ltd and Others [2018] EWHC 219 (QB), Master McCloud identified that the CPR do not deal with the situation where a third party has given notice that they believe they are entitled to ......