Johnson v Ribbins
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE GOFF |
| Judgment Date | 01 December 1976 |
| Judgment citation (vLex) | [1976] EWCA Civ J1201-1 |
| Docket Number | 1971 J. No. 4625. |
| Court | Court of Appeal (Civil Division) |
| Date | 01 December 1976 |
[1976] EWCA Civ J1201-1
Lord Justice Buckley.
Lord Justice Goff
Lord Justice Bridge
In The Supreme Court of Judicature
Court of Appeal
On Appeal from Chancery Division, Mr. Justice Walton.
MR. PETER MILLETT Q.C. and MR. D. IWI (instructed by Messrs. Reynolds, Porter, Chamberlain & Co.) appeared on behalf of the Appellants.
MR. A.J. BALCOMBE. Q. C. and MR. D.G. RICE (instructed by Messrs. Charles Mason & Co) appeared on behalf of the Respondents (4th and 5th Defendants)
THE Plaintiff, 1st, 2nd and 3rd Defendants did not appear and were not represented.
This is an appeal by leave of Mr. Justice Walton from an order made by him as to costs only on 23rd May, 1975.
The plaintiff, Mrs. Johnson, was one of three co-mortgagors of the Highland Hotel, Shanklin, Isle of Wight and she brought this action by writ issued on 28th July, 1971 against the mortgagee, Mrs. Ribbins (since deceased). She joined as defendants the other two mortgagors, a Mr. Garfitt and a Mr. Worswick, so that the proceedings might not be defective for want of parties. In that purpose she failed because the writ was never served on them, but nothing turns on that so far as this appeal is concerned.
Mrs. Ribbins died on 24th April, 1973 and by order to carry on dated 16th July, 1973 her personal representatives to whom I will refer as the defendants were made defendants in her place.
On 1st March, 1974 after the commencement of the action the plaintiff obtained legal aid.
Mrs, Ribbins had sold the hotel under her power of sale as mortgagee and the plaintiff alleged that this was at a gross undervalue inasmuch as the price was £40,000 but the true value according to the plaintiff was no less than £65,000.
The main object of the action was to recover damages for the loss of the difference, £25.000, but there were two subsidiary issues.
First, there was on any showing a surplus in excess of £11,000 after discharging principal and interest under the mortgage, and Mrs. Ribbins had retained this. At the date of the writ she was entitled so to do, because the plaintiff was claiming payment of this sum to her alone, and she had produced neither evidence to show her sole entitlement, nor any authority from Messrs. Garfitt and Worswick to pay the money to her.
After this action had been started they admitted in other proceedings that they claimed no beneficial interest in this surplus, and thereupon Mrs. Ribbins or the defendants paid over the greater part of it to the plaintiff, retaining £1,500 as security for their costs.
At the trial the learned Judge held that the defendants were entitled to continue to retain this sum and to set it off against the costs of the action ordered to be paid to them by the plaintiff.
The issue between the parties on this part of the case involved no more than the examination of a limited amount of correspondence, and counsel estimated that it occupied the court about half a day.
The other subsidiary point was a claim by the plaintiff that the mortgagee's account was inaccurate, as indeed the learned Judge decided in some degree it was. Because of the defect as to parties he could not order an account, but instead he granted the plaintiff an appropriate declaration. This success he regarded as trivial and wholly insignificant so far as concerns the incidence of costs. This issue occupied the time of the Court, counsel told us, not more than a few minutes.
The trial as a whole took eleven days and all the rest of the time was taken up with the main issue concerning the sale at an alleged gross undervalue.
This was pleaded in the Statement of Claim as follows:" (6) in exercising her statutory power of sale as Mortgagee Mrs. Ribbins owed a duty to the Mortgagors to take reasonable care to obtain the market value of the said property as consideration for the sale thereof. (7) The market value of the said property in April 1971 was £65,000. In the premises the sale by Mrs. Ribbins of the said property on or about 19th April 1971 for the sum of £40,000 was improvident and at a gross undervalue. (8) By selling the said property as aforesaid Mrs. Ribbins acted negligently and in breach of her duty to the Mortgagors, notably the Plaintiff who has the sole beneficial interest in the balance of the proceeds of the said sale. (9) By reason of the matters aforesaid the plaintiff has suffered loss and damage."
The Master ordered further and better particulars, and when these were given it appeared that the plaintiff was relying upon (l) various allegednegligent acts and omissions on the part of Mrs. Ribbings agents Sir Francis Pittis & Son, a well known and highly reputable firm, to whom I will refer as the agents and (2) an allegation that the sale was effected with undue haste, and precipitancy of which she gave details attacking the conduct of Mrs. Ribbins's Solicitor a Mr. Laikin.
By notice dated 20th September, 1975 the defendants brought in the agents as third parties. They put in a defence denying liability and took part in the trial.
The attack on Mr. Laikin and the case generally as to undue haste and precipitancy more or less doubled the length of the trial at which the agents and Mr. Laikin were both completely and triumphantly vindicated. The learned Judge found that the true value of the Hotel was only about £30,000 or £32,500; that Mr. Hearn, the partner in the agent's firm who had dealt with the matter, so far from being negligent had given Mrs. Ribbins excellent and accurate advice; and that Mr. Laikin was in no way responsible for the fact that the plaintiffs' solicitor had deluded himself, and that Mr. Laikin was doing his duty conscientiously and thoroughly and with great courtesy.
In these circumstances the learned Judge held that directly or indirectly the plaintiff must, subject to her position as a legally aided party, pay whether directly or indirectly all the costs of the defendants (including, of course, those of the deceaeed Mrs. Ribbins) and of the agents, and that is not in issue before us. As, however, the plaintiff is protected in respect of all costs incurred after she obtained legal aid, and that is by far the greater proportion of the costs, and as her financial circumstances appear to be such that it is doubtful whether costs even before the date of the certificate will in fact be recoverable, it is of great importance to the defendants and the agents respectively whether the defendants have to pay the agents' costs and add them to those they can charge agaimst the plaintiff or whether subject to the effect of the Legal Aid Act, the plaintiff is made directly responsible for both sets of costs.
The Order dated 23rd May 1975 which the learned Judge made as to costs so far as material was as follows: "AND IT IS ORDERED that this Action and the said Third Party proceedings do stand dismissed out of this Court AND IT IS ORDERED that it be referred to the Taxing Master to tax (1) the costs of this Action and of the said Third Party proceedings of the Defendants Trevor Henry Frederick Ribbins and Iris Mildred Kate Sibbins incurred down to and including 1st March 1974 (including therein the costs of the deceased Defendant Mildred Kate Ribbins) (2) the costs of the said Third Party proceedings of the Third Party incurred down to and including 1st March 1974 (3) the costs of this Action and of the said Third Party proceedings of the Defendants Trevor Henry Frederick Ribbins and Iris Mildred Kate Sibbins incurred since 1st March 1974 CO the costs of the said Third Party...
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...defendant to bring in a third party at all is always a question to be considered." 132 That approach was subsequently approved in Johnson v Ribbins and Ors [1977] 1 WLR 1458. Goff LJ (as he then was) said: "Generally, we think it will be found, and certainly so in this case, that the defend......