Faith Panton Property Plan Ltd v Hodgetts

JurisdictionEngland & Wales
JudgeLORD JUSTICE WALLER,LORD JUSTICE BRANDON,SIR DAVID CAIRNS
Judgment Date21 January 1981
Judgment citation (vLex)[1981] EWCA Civ J0121-5
Docket Number81/0053
CourtCourt of Appeal (Civil Division)
Date21 January 1981

[1981] EWCA Civ J0121-5

IN THE SUPREME COURT OF JUDICATURE

COURT OF APPEAL

ON APPEAL FROM THE CHANCERY DIVISION

GROUP B

Royal Courts of Justice,

Before:

Lord Justice Waller

Lord Justice Brandon

Sir David Cairns

81/0053

1979 F. No. 519

Faith Panton Property Plan Ltd.
and
Hodgetts

Mr C. BRODIE, Q.C. and Mr M. WARNER (instructed by Messrs Dawson & Co.) appeared on behalf of the Appellants.

Mr A.C. HODGETTS was in person.

1

LORD JUSTICE WALLER
2

This is an appeal from a judgment of Mr Justice Vinelott in which he refused an injunction against both defendants. The plaintiff company has a business of interior decorators, designers and suppliers of bathroom equipment. The defendants also manufacture fibreglass baths and other bathroom equipment. In 1978 and early 1979 there was an agreement between the plaintiff company and either the first defendant or both defendants concerning the manufacture of bathroom equipment. In March 1979 that agreement was determined and there followed a number of proceedings in the High Court. The plaintiff brought proceedings alleging passing off, procuring breaches of contract, slander of goods and malicious falsehood and moved for interlocutory relief as a result of which a number of undertakings were given to the court until trial. There was also a counter claim in the same proceedings raising claims to copyright and the ownership of the patent and alleging infringement of the copyright and patent. There was also a reply and defence to that counter claim. Those were proceedings in the Chancery Division and there was also an action in the Queen's Bench Division.

3

On 8th November, 1979 the plaintiff obtained judgment in the Queen's Bench Division for £9,679.23 but a stay of execution was granted pending the determination of the Chancery proceedings. On 23rd January, 1980 both defendants were ordered to pay costs which were subsequently taxed at £526.24 on a motion to set aside a subpoena on Mrs Steedman, the majority shareholder in the plaintiff company. On 3rd November, 1980 the first defendant was ordered to pay the costs of four Motions before Mr Justice Foster. The judge directed that the costs were to be taxed on an indemnity basis and paid forthwith. They have not yet been taxed and it is estimated they will not be taxed for some four or five months but that they will be assessed at approximately £12,000.

4

The first defendant has said that he intends to go bankrupt, has said falsely that he had an offer from a substantial company for his assets. He then said after that that he received another offer and accepted it and that he has spent the purchase money. He has told the plaintiff's solicitors that he intends to sell his copyright and patents to a substantial company; he also has said that moulds which are estimated to be worth £1,000 each are in his possession but that he had sold them in March 1979 on terms that he was allowed to remain in possession of them.

5

The plaintiff company is anxious about the enforcement of the order for costs of approximately £12,000 and in this application they apply to restrain the defendants from dealing in any rights that they may have in the alleged copyrights, patent or in the moulds, and they also seek an order that each of the defendants disclose upon oath the names of the persons to whom they have assigned or transferred the copyrights, letters patent or moulds.

6

The plaintiff claims that the company is entitled to the injunction under Section 45 of the Supreme Court of Judicature (Consolidation) Act, 1925, and on the authority of the Mareva decisions.

7

Section 45 of the Supreme Court of Judicature (Consolidation) Act, 1925 , reads "(1) the High Court may grant a mandamus or an injunction or appoint a receiver, by an interlocutory order in all cases in which it appears to the court to be just or convenient so to do." Mr Brodie submits that the discretion given to the court is one which is unfettered and relies on the cases of Beddow v. Beddow 9 Ch. D 89Blunt v. Blunt (1943) A.C. 517 and Ward V. James (1966) 1 Q.B. 273. In the latter case Lord Denning, at page 295, said "The cases all show that when a statute gives discretion the courts must not fetter it by rigid rules from which a judge is never at liberty to depart. Nevertheless the courts can lay down the considerations which should be borne in mind in exercising the discretion and point out those considerations which should be ignored". Where however a plaintiff is asking for an injunction in proceedings which are pending Lord Justice Cotton in Lister v. Stubbs 45 Ch. D 1 said "I know of no case where, because it was highly probable that if the action were brought to hearing the plaintiff could establish that a debt was due to him from the defendant, the defendant has been ordered to give security until that has been established by the judgment or decree."

8

We have been referred to a number of matrimonial cases both in the 19th century and the first half of this century in which injunctions were granted or refused and it would seem that in practice an injunction was only granted where the sum due was a liquidated sum which had been ordered by the court. See, for example, Newton v. Newton 11 P.D. 11, Jagger v. Jagger (1926) P. 23, Scott v. Scott (1951) P. 193 and a number of other cases. These cases are no longer good law because as Lord Justice Brandon pointed out in the course of argument Parliament has reversed them in matrimonial cases.

9

Cummins v. Perkins 68 L.J.Ch. 57 (1899) 1 Ch. 16 (which was not a matrimonial case) showed that an order for costs could be the subject of an order for a Receiver of a married woman's separate estate even though those costs had not been taxed. Sir Nathaniel Lindley, Master of the Rolls, made the order for a Receiver on the ground that the court was "Dealing with equitable estates and the judgment that money [was] to be paid out of a particular estate". He went on "That is the principle on which the judge has gone—a perfectly sound principle even without invoking Section 25 of the Judicature Act, 1873. But the introduction of that Section does not curtail the powers of the court to grant injunctions. It expands it. There is no doubt at all about that. It has not revolutionised the law, but it has enabled the court to grant injunctions and appoint Receivers where it used not to do so before—I will not go so far as to say where it had no jurisdiction to do so—but where in practice the court never did so……".

10

Mr Brodie has also relied on the Mareva line of cases: Nippon v. Karageorgis (1975) 1 W.L.R. 1093, The "Mareva" (1975) 2 Lloyds Rep. 509, (1981) A.E.R. 213, The "Pertamina" (1978) Q.B.644 and The "Siskina" (1979) A.C. 210 and Rahman v. Abutah (1980) 1 W.L.R. 1268 and others as altering the practice which had hitherto governed such cases. He has submitted that although the Mareva line of cases all concerned either foreign defendants who had assets in this country which were liable to be removed or, as in the case of Rahman, a foreign defendant apparently living in this country in similar such circumstances the only logical explanation of the exercise of the jurisdiction was on the basis of jeopardy. That unless some such order was made the plaintiff would be jeopardised by being deprived of the fruits of any judgment that he might get. It was submitted that jeopardy does not depend solely on the risk of assets being removed out of the jurisdiction and reliance was placed on the judgment of Master of the Rolls Lord Denning in Rahman's case as showing that the Mareva injunction is not to be confined to cases where assets are likely to be removed out of the jurisdiction. At page 1273 Lord Denning said: "So I would hold that a Mareva injunction can be granted against a man even though he is based in this country if the circumstances are such that there is a danger of his absconding or a danger of the assets being removed out of the jurisdiction or disposed of within the jurisdiction or otherwise dealt with so that there is a danger that the plaintiff if he gets judgment will not be able to get it satisfied". Emphasis was placed on the words "disposed of within the jurisdiction". It was submitted that removal out of the jurisdiction was logically only one way in which jeopardy could occur. In the Pertamina case Lord Justice Orr expressed the view (page 664) "Whether it is right or just to exercise this particular jurisdiction must depend on all the circumstances of a given case and not in my judgment on any single factor". And then Lord Justice Orr went on to enumerate the factors such as the apparent strength or weakness of the plaintiff's case, whether it is restricted to money, the effect on the defendant and so on. For myself I see the force of this argument but to accept it would, in my opinion, be a considerable extension of the Mareva doctrine and I would wish to reserve my opinion until the facts of the case make it necessary so to consider.

11

I find it unnecessary to make the decision as to whether or not a Mareva injunction would apply in the circumstances suggested by Mr Brodie. All of the authorities before the Mareva cases go to show that injunctions will not be granted before judgment. This is an intermediate case. It is not a case where it is highly probable that if the action is brought to a hearing the plaintiff would be able to establish a debt as Lord Justice Cotton was considering in Lister v. Stubbs. It is a case where the defendant has been ordered to pay the costs of a hearing on an indemnity basis. A hearing that took four days. It is only because of the delay which must inevitably take place before taxation that the plaintiff has not been enabled to execute the...

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