Magiera v Magiera
| Jurisdiction | England & Wales |
| Judge | Lady Justice Black,Lord Justice Sales,Lord Justice Irwin |
| Judgment Date | 15 December 2016 |
| Neutral Citation | [2016] EWCA Civ 1292 |
| Docket Number | Case No: B6/2015/2390 |
| Court | Court of Appeal (Civil Division) |
| Date | 15 December 2016 |
[2016] EWCA Civ 1292
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE FAMILY DIVISION
MR JUSTICE BODEY
FD14F00345
Royal Courts of Justice
Strand, London, WC2A 2LL
Lady Justice Black
Lord Justice Sales
and
Lord Justice Irwin
Case No: B6/2015/2390
Mr Michael Horton & Mr Alexander Laing (instructed by Dawson Cornwell) for the Appellant
Mr Tim Amos QC & Ms Saima Younis (instructed by Howard Kennedy) for the Respondent
Hearing date: 1 st November 2016
Judgment Approved
This appeal concerns the jurisdiction provisions of the Council Regulation (EC) No 44/2001 on jurisdiction and the recognition of judgments in civil and commercial matters (" Brussels I"). It is against an order made by Bodey J, on 6 July 2015, refusing to dismiss or stay proceedings brought in relation to a London house under the Trusts of Land and Appointment of Trustees Act 1996 ("TLATA 1996" or simply "TLATA"). The appellant also appeals against an aspect of the judge's order in relation to the costs of his application for stay or dismissal of the TLATA proceedings. Bodey J not only ordered the appellant to pay the respondent's costs of the application but also provided that the outstanding costs may be charged on the appellant's share of the house. There is no appeal against the costs order as such but the appellant appeals against the charging provision.
The TLATA application and Bodey J's decision on jurisdiction
The parties were once husband and wife and, although they are now divorced, in an endeavour to make this judgment easier to understand, I will refer to them as such hereafter, with apologies to them for this inaccuracy. They acquired a London house in their joint names during the course of their marriage. In late April/early May 2014, the respondent wife issued an application under TLATA 1996 seeking an order for sale of the house, together with an order that the proceeds, after redemption of the mortgage, be distributed between herself and the appellant husband in equal shares.
The husband contested the jurisdiction of the English court to entertain the wife's proceedings and applied for them to be dismissed or stayed. The wife argued that the courts of England and Wales had jurisdiction on the basis of several of the jurisdictional grounds set out in Brussels I. Bodey J held that it had not been established that the husband was domiciled here, so Article 2 did not assist the wife. However, he held that two other jurisdictional grounds were made out.
First, and foremost, the judge held that there was jurisdiction under Article 22 on the basis that the TLATA proceedings had as their object rights in rem in immovable property situated here.
Secondly, as an alternative basis of jurisdiction, Bodey J held that Article 5(6) applied because the husband was being sued "as settlor, trustee or beneficiary of a trust created by the operation of statute" and "the trust is domiciled" here. Unlike jurisdiction under Article 22, jurisdiction under Article 5(6) is not exclusive and can be displaced. The judge therefore went on to consider the husband's argument that there had been prorogation of jurisdiction, in accordance with Article 23, in favour of the courts of Poland, reaching the conclusion that there had not. He also considered the husband's argument that there were "related actions" in Poland and England and that, under Article 28, he should stay the English proceedings. He held that Article 28 did not apply, not least because, in his judgment, there were not related actions pending in the two jurisdictions. Furthermore, he took the view that the English court, not the Polish court, was first seised so Article 28 did not entitle him to stay the English proceedings.
I will not seek to summarise Bodey J's judgment further here. It can be found on bailii.org identified as G v G [2015] EWHC 2101 (Fam) and is extremely clear, dealing with the various arguments that were advanced before the judge and also with the factual background to the case. Before turning to the legal issues that arise, I will refer very briefly to the history, but this appeal can be resolved without going into it in any detail.
History
The TLATA proceedings were preceded by an extensive history of litigation between the parties.
The marriage appears to have broken down years ago. The wife began matrimonial proceedings in France as long ago as 2001 and formal divorce proceedings there in 2002. Much litigation in France followed, prior to the divorce becoming effective in July 2013. Meanwhile, proceedings had been begun in Poland by the husband, in relation to the division of the parties' assets. There have been various moves in those proceedings but there has been no final resolution as yet.
During the marriage, the parties acquired property in France, Poland and England which they still own. I have already referred to the acquisition of the London house in their joint names. This was in 1990. It was recorded in the transfer that the survivor could give a valid receipt for capital money arising on a disposition of the land. The joint tenancy was later severed by the wife, on 26 October 2011.
The wife's particulars of claim in the TLATA proceedings give the following information about the house. The purpose of the purchase is said to have been "as a joint investment or as a family home in the event that the parties were to live in London". However, it is said that they never occupied it as a family home because they moved to Poland in 1991. For 10 years, having been subdivided into two flats, the property was rented out but, according to the particulars of claim, at some point after the parties separated in 2001, the husband converted it into a single dwelling and, for the 18 months prior to the issue of the proceedings, it had been occupied by two of the parties' children.
The appeal in relation to jurisdiction: ground 1: Article 22
With the exception of the judge's finding as to domicile, which was in accordance with the husband's case, the husband's grounds of appeal challenged each one of the judge's conclusions. For the present, I will concentrate upon his challenge to the judge's decision that the English court has jurisdiction under Article 22. I do so because, in the event that the husband's argument in this respect fails, that will be determinative of the appeal. As Article 22 provides for exclusive jurisdiction, if the English court does have jurisdiction under it, there is no room for arguments about prorogation under Article 23, or staying the English proceedings under Article 28 so as to allow the Polish courts to proceed with a related action. Similarly, with jurisdiction established under Article 22, there would be no need to consider the points raised in the wife's Respondent's Notice, by which she sought to argue that the judge should have found that the husband was domiciled in England and Wales at the material time.
The argument in front of Bodey J revolved around the case of Webb v Webb (Case C-294/92) [1994] QB 696, a decision of the (as it then was) Court of Justice of the European Communities ("CJEC"). Mr Horton, on behalf of the husband, argued that, properly applied to the facts of this case, it led to the conclusion that the wife's TLATA proceedings had as their object rights in personam, not rights in rem as required by Article 22. Bodey J distinguished Webb v Webb, his reasoning being as follows:
"31. In my judgment, the instant case is distinguishable from Webb v Webb. There the father was seeking to establish and acquire rights in immovable property by way of a Constructive or Resulting Trust, on the basis that the French flat in the son's name had been purchased with his (the father's) money. Here, by contrast, the existence (or not) of a trust is not in dispute. The wife already has proprietary rights in the London house as co-owner. What she is seeking to do is to enforce and give effect to those rights. It is fair comment that the order which she seeks would be as against the husband personally, requiring him to join with her in selling the property. To that extent it would be an in personam order; but the right which would lead to such an order is a right of ownership in the property 'available against the whole world'." [emphasis in the original]
Mr Horton's argument on appeal was that Bodey J was wrong to distinguish Webb v Webb in this way. In seeking to persuade us of this, he relied also on the English authorities of Re Hayward [1997] Ch 45 and Ashurst v Pollard [2001] Ch 595.
Immediately before the hearing of the appeal, a further decision of the Court of Justice of the European Union ("CJEU") came to light, namely Komu v Komu (Case C-605/14) [2016] 4 WLR 26. On the face of it, this presented Mr Horton with a considerable obstacle, but he endeavoured to surmount it in argument. Ultimately, I was not persuaded that it could be surmounted, for the reasons which I will now set out.
Article 22 and the case law
The starting point is Article 22 itself 1 which, so far as material, reads:
"The following courts shall have exclusive jurisdiction, regardless of domicile:
1. in proceedings which have as their object rights in rem in immovable property or tenancies of immovable property, the courts of the Member State in which the property is situated;"
In surveying the European and domestic authorities which may assist in interpreting Article 22, it is important to recognise that it is the European authorities and not the domestic ones which ultimately govern the interpretation of Article 22. This is because, as the CJEU has made clear, in order to ensure that the rights and obligations arising from the Regulation for Member States and for individuals are as...
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