Gabriele Volpi v Matteo Volpi
| Jurisdiction | England & Wales |
| Judge | Lord Justice Lewison,Lord Justice Males,Lord Justice Snowden |
| Judgment Date | 05 April 2022 |
| Neutral Citation | [2022] EWCA Civ 464 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | Case No: CA-2021-000718 (Formerly A3/2021/1460) |
[2022] EWCA Civ 464
Lord Justice Lewison
Lord Justice Males
and
Lord Justice Snowden
Case No: CA-2021-000718 (Formerly A3/2021/1460)
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
His Honour Judge Jarman QC
BL-2019-001956
Royal Courts of Justice
Strand, London, WC2A 2LL
Adrian Beltrami QC AND Dominic Kennelly (instructed by Taylor Wessing LLP) for the Appellant
Andrew Holden AND James Bradford (instructed by Grimaldi SL LLP) for the Respondent
Hearing date: 15 March 2022
Approved Judgment
This judgment was handed down remotely by circulation to the parties' representatives by email, and release to BAILII. The date and time for hand down is deemed to be 10am on 5 April 2022.
The issue on this appeal is whether HHJ Jarman QC was wrong to find that a sum of CHF 4 million paid by Delta Ltd to Matteo Volpi for the purchase of an apartment in Lugano; and a further CHF 2 million paid for works to that property was an interest-free loan rather than a gift. Delta is a company under the control of Gabriele Volpi, Matteo Volpi's father.
Appeals on fact
The appeal is therefore an appeal on a pure question of fact. The approach of an appeal court to that kind of appeal is a well-trodden path. It is unnecessary to refer in detail to the many cases that have discussed it; but the following principles are well-settled:
i) An appeal court should not interfere with the trial judge's conclusions on primary facts unless it is satisfied that he was plainly wrong.
ii) The adverb “plainly” does not refer to the degree of confidence felt by the appeal court that it would not have reached the same conclusion as the trial judge. It does not matter, with whatever degree of certainty, that the appeal court considers that it would have reached a different conclusion. What matters is whether the decision under appeal is one that no reasonable judge could have reached.
iii) An appeal court is bound, unless there is compelling reason to the contrary, to assume that the trial judge has taken the whole of the evidence into his consideration. The mere fact that a judge does not mention a specific piece of evidence does not mean that he overlooked it.
iv) The validity of the findings of fact made by a trial judge is not aptly tested by considering whether the judgment presents a balanced account of the evidence. The trial judge must of course consider all the material evidence (although it need not all be discussed in his judgment). The weight which he gives to it is however pre-eminently a matter for him.
v) An appeal court can therefore set aside a judgment on the basis that the judge failed to give the evidence a balanced consideration only if the judge's conclusion was rationally insupportable.
vi) Reasons for judgment will always be capable of having been better expressed. An appeal court should not subject a judgment to narrow textual analysis. Nor should it be picked over or construed as though it was a piece of legislation or a contract.
If authority for all these propositions is needed, it may be found in Piglowska v Piglowski [1999] 1 WLR 1360; McGraddie v McGraddie [2013] UKSC 58, [2013] 1 WLR 2477; Fage UK Ltd v Chobani UK Ltd [2014] EWCA Civ 5, [2014] FSR 29; Henderson v Foxworth Investments Ltd [2014] UKSC 41, [2014] 1 WLR 2600; Elliston v Glencore Services (UK) Ltd [2016] EWCA Civ 407; JSC BTA Bank v Ablyazov [2018] EWCA Civ 1176, [2019] BCC 96; Staechelin v ACLBDD Holdings Ltd [2019] EWCA Civ 817, [2019] 3 All ER 429 and Perry v Raleys Solicitors [2019] UKSC 5, [2020] AC 352.
Similar caution applies to appeals against a trial judge's evaluation of expert evidence: Byers v Saudi National Bank [2022] EWCA Civ 43, [2022] 4 WLR 22. It is also pertinent to recall that where facts are disputed it is for the judge, not the expert, to decide those facts. Even where expert evidence is uncontroverted, a trial judge is not bound to accept it: see, most recently, Griffiths v TUI (UK) Ltd [2021] EWCA Civ 1442, [2022] 1 WLR 973 (although the court was divided over whether it was necessary to cross-examine an expert before challenging their evidence). In a handwriting case, for example, where the issue is whether a party signed a document a judge may prefer the evidence of a witness to the opinion of a handwriting expert based on stylistic comparisons: Kingley Developments Ltd v Brudenell [2016] EWCA Civ 980.
Tribunals are free to draw, or to decline to draw, inferences from the facts of the case before them using their common sense. Whether any positive significance should be attached to the fact that a person has not given evidence, or to the lack of contemporaneous documentation, depends entirely on the context and particular circumstances: Royal Mail Group Ltd v Efobi [2021] UKSC 33, [2021] 1 WLR 3863.
Trial
The judge conducted a four-day trial, in the course of which he heard live evidence from witnesses who were cross-examined; and he also had expert evidence from document examiners on the question whether certain signatures, purportedly made by Matteo Volpi, were genuine. There was, however, little contemporaneous documentary evidence which, the judge said, had made his fact-finding task more difficult. Any trial judge will have been faced with the task of trying to do a jigsaw puzzle when some of the pieces are missing; and many of the others do not precisely fit together.
In evaluating the evidence adduced at trial a judge will consider not only the live evidence called before him and contemporaneous documents but also the inherent probabilities of each side's case. The judge observed at [52] that the contemporaneous documents (such as they were) and inherent likelihoods were “particularly important”.
Main facts
I begin by setting out the main uncontested facts.
Gabriele Volpi has two adult sons by his ex-wife Rosaria Rota, Matteo and Simone. He acquired his considerable wealth in the oil business in Nigeria. Both sons had, at times, worked in that business. Gabriele Volpi was, as the judge found, obsessed to protect his assets for himself and his blood line and against any claim, for example from his daughters-in-law upon any subsequent breakdown of their marriage to his sons. Matteo Volpi described it as “paranoia”.
It was common ground at trial that in late 2011, in connection with an impending move from Nigeria to Switzerland, Matteo Volpi asked Mr Cuzzocrea (a long-time business associate of and adviser to Gabriele Volpi) to help him obtain a loan in order to buy the apartment in Lugano. Mr Cuzzocrea ran the family office in Lugano at that time. At about the same time, Simone Volpi also moved from Nigeria to Switzerland.
That approach led to a conversation between Matteo Volpi and his father. Matteo Volpi gave evidence about that conversation. His evidence was that as a result of the conversation he understood that the property would be bought by a trust of which he was a beneficiary. He accepted in cross-examination that his father did not use the word “gift”; but maintained that he thought the property would be bought by family trusts which his father had set up. Gabriele Volpi was due to give evidence, but in the event he was unable to do so because he became ill. The judge refused to admit his statement as hearsay evidence and did not refer to it in his judgment.
Dr Baggi (an attorney and notary who acted for the family) told the judge that he spoke to both Gabriele Volpi and Matteo Volpi in 2011 about the proposed loan from father to son, but the judge was not satisfied that his recollection was accurate in that respect.
In late 2011 Dr Baggi was instructed by Mr Cuzzocrea on behalf of Mr Matteo Volpi to prepare all necessary documents for the purchase of the apartment; and this he delegated to Mrs Catta (his secretary and personal assistant), under his supervision. As Matteo Volpi was then resident in Nigeria, permission had to be sought from the First Instance Authority of the District of Lugano to make the purchase. The permission was granted, subject to appeal, on 8 February 2012, and the permission noted that Matteo Volpi was represented by Dr Baggi.
The next day Matteo Volpi executed a power of attorney in favour of Mr Cuzzocrea to sign on his behalf the sale and purchase deed in respect of the apartment. Those documents were drafted by Mrs Catta under the supervision of Dr Baggi. The same day Mr Cuzzocrea executed the deed, which recorded the purchase price of CHF 4 million, to which the power of attorney was then attached. An entry was made in the land register that Dr Baggi was irrevocably instructed by the parties to register the deed as soon as the time for appealing the permission had passed.
The deposit of CHF 400,000 was sent by Delta to Dr Baggi's firm in two tranches by 13 February 2012. On 20 February Dr Baggi emailed Mr Cuzzocrea saying that he was sending the draft of a loan agreement between Gabriele Volpi and Matteo Volpi and attached an unsigned draft in the sum of CHF 4 million. By 28 February 2012 Gabriele Volpi had signed that agreement. The balance of the purchase price was transferred to Dr Baggi's firm by Delta on 2 March.
On 4 April 2012 Dr Baggi emailed Mr Cuzzocrea saying he was sending two drafts of the loan agreements “between father and sons” and asked him to check if they were “ok”. The reference to “sons” (plural) was a reference to both Matteo and Simone. He attached a draft of an unsigned loan agreement between Gabriele Volpi and Matteo Volpi, this time in the sum of CHF 5 million, and another unsigned loan agreement between Gabriele Volpi and his other son Simone in the sum of CHF 3 million. The former was...
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