Messih v McMillan Williams and Others
| Jurisdiction | England & Wales |
| Judge | Lord Justice Patten,Lord Justice Elias,Lord Justice Ward |
| Judgment Date | 22 July 2010 |
| Neutral Citation | [2010] EWCA Civ 844 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | Case No: B2/2010/0057 |
| Date | 22 July 2010 |
[2010] EWCA Civ 844
Mr Recorder Cohen QC
Before: Lord Justice Ward
Lord Justice Elias
and
Lord Justice Patten
Case No: B2/2010/0057
CHY08423
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM CENTRAL LONDON CIVIL JUSTICE CENTRE
William McCormick QC (instructed by McMillan Williams) for the Appellant
Tim Calland (instructed by Dewar Hogan) for the Respondent
Hearing date: 12 th July 2010
Lord Justice Patten:
This is an appeal by the fourth defendant (“MW”), which is a firm of solicitors, against an order of Mr Recorder Cohen QC made on 18 th December 2009 who directed that there should be no order in respect of the costs of the claim against MW following the service by the claimant, Mr Messih, of a notice of discontinuance. This is therefore a costs only appeal in which, in order to succeed, MW must demonstrate that the Recorder has either misdirected himself in the principles to be applied or has failed to apply the correct principles by making a decision without taking into account some relevant factor or by including, as part of his reasoning, considerations which were immaterial.
Permission for the appeal was refused by the Recorder and by Jacob LJ on the papers but was subsequently granted on a renewed application by Lloyd and Moore-Bick LJJ.
Before I come to the principles to be applied and to the Recorder's reasons for his decision, it is necessary to summarise the history of the litigation which resulted in the discontinuance of the proceedings against MW.
Mr Messih was the tenant of commercial premises at 208 and 210 Queenstown Road, Battersea, London, SW8 which were held under two separate leases granted for terms of 12 years from 16 th November 199Each lease contained covenants by the tenant to keep the premises in good repair and a proviso for re-entry in the event of a breach.
In the particulars of claim Mr Messih alleged that on 6 th August 2001 he consulted the first defendant, Ms Fitzpatrick, about a proposed assignment of the two leases. She was a partner in the firm of Laurie Moran Arthur based in Wimbledon. The second and third defendants were the other partners in that firm. I shall refer to them collectively as “LMA”.
Shortly afterwards on 22 nd August the landlord of the claimant's premises, a Mr Menten, served on LMA as the claimant's solicitors two notices under s.146 of the Law of Property Act 1925 accompanied by schedules of dilapidations relating to both properties. The notices required the items of disrepair to be remedied within one month of the date of the notices.
Because the unexpired residue of the terms of both leases exceeded three years Mr Messih was entitled to the protection of the Leasehold Property (Repairs) Act 1938 (“the 1938 Act). Had a counter-notice or notices been served on the landlord claiming the benefit of the 1938 Act Mr Menten could not have enforced the repairing covenants or exercised his right to forfeit the leases for breach of those covenants without the leave of the court. It was Mr Messih's case against LMA and MW that none of the grounds for giving leave specified in s.1(5) of the 1938 Act was applicable at the time.
Mr Messih's case against LMA was that Ms Fitzpatrick failed to advise him of his right to claim the benefit of the 1938 Act by serving counter-notices on the landlord; failed to serve any such notices within the 28 days allowed or at all; and failed to advise him of the consequences of that omission and, in particular, that he should make an application to the court for relief from forfeiture.
It is said that, had such an application been made, relief would have been granted on terms that the repairs were carried out. The costs of the repairs at the time were estimated by Mr Messih's surveyor to have amounted to £2,229.50 plus VAT. In the event, no steps were taken to protect the leases and Mr Menten forfeited them by peaceable re-entry on 8 th October 2002. The combined value of the forfeited leases was alleged to have been some £20,000. On this basis Mr Messih claimed damages for negligence against LMA.
The claim against MW was for the same loss but had a more limited factual basis. Mr Messih's case was that, on a date prior to 19 th October 2001, he consulted Mr Ian Butler, a solicitor employed by MW, in connection with the s.146 notices which had been served on 22 nd August. By then the 28 day period for the service of counter-notices under the 1938 Act had, of course, expired. On 24 th October Mr Butler wrote to Mr Messih advising him that it appeared that no counter-notices had been served but failed, it is alleged, to advise him of the need to apply to the court for relief from forfeiture.
In their defence LMA admitted the retainer by Mr Messih but alleged that the first defendant had served counter-notices under the 1938 Act on the landlord's solicitor by 14 th September and had passed this information on to MW in a letter of 8 th October 2001. They therefore denied that they had been negligent or that they were responsible for the claimant's loss of the leases. They also put in issue Mr Messih's ability to fund the necessary repairs to the premises as a condition of obtaining relief from forfeiture.
MW's defence was that they were consulted by Mr Messih sometime in October 2001 under the Community Legal Service's Green Form scheme. This enables initial advice to be given to the client but does not extend to the funding of representation in court proceedings. Their case is that Mr Messih was advised by Mr Butler that there was no evidence on the LMA file that Ms Fitzpatrick had in fact served any counter-notices under the 1938 Act; that the claimant had a right to apply to the court for relief from forfeiture; that he should obtain counsel's advice about possible proceedings; but that no further CLS funding was available for that purpose and that if MW was to give Mr Messih further assistance he would have to instruct the firm as a private client for that purpose. Their case is that they went so far as to write to Mr Menten's solicitors indicating that the claimant proposed to seek relief from forfeiture and, if necessary, an injunction to prevent peaceable re-entry but that Mr Messih was unwilling or unable to instruct them to take such proceedings on a private client basis and to put them in funds for that purpose. After reminder letters sent in January 2002 went unanswered, they closed their file.
Mr Messih issued his claim against LMA and MW in March 2008. Pleadings, disclosure and the exchange of witness statements followed and the trial was listed for 3 days beginning on 1 st September 2009. No evidence was served by LMA. The partnership had by then been dissolved and the defence was conducted by their professional indemnity insurers. Mr Messih's own costs were funded by his solicitors under a CFA. On 10 th August 2009 the claim against LMA was settled on terms contained in a Tomlin order of that date. LMA agreed to pay to Mr Messih the sum of £21,500 in full and final settlement of his claims against them and to pay his costs of the claim which were to be assessed on the standard basis if not agreed.
It was a term of the settlement that LMA would discontinue the contribution proceedings which they had served on MW and this was subsequently done. But MW refused to agree to Mr Messih discontinuing his claim against them with no order for costs. Their position had always been that the claim against Mr Butler was unmeritorious and had no realistic prospect of success. Following their refusal to settle on a drop-hands basis, Mr Messih nonetheless went ahead and served notice of discontinuance of his claim against them on 10 th August. The costs consequence of this are prescribed by CPR 38.6 which provides that:
“(1) Unless the court orders otherwise, a claimant who discontinues is liable for the costs which a defendant against whom the claimant discontinues incurred on or before the date on which notice of discontinuance was served on the defendant.”
On this basis MW proceeded to commence detailed assessment proceedings for the recovery of their costs. This was met by an application by the claimant issued on 22 nd September for an order under CPR 38.6(1) that he should not be required to pay MW's cost of the action. The application notice states that Mr Messih has received and accepted an offer from LMA which renders the claim against MW academic. In a witness statement in support of the application Mr Hogan of Messrs Dewar Hogan, the claimant's solicitors, summarised the basis of the claim. This includes a critique of Mr Butler's evidence that he did advise Mr Messih of the need to apply for relief from forfeiture. Mr Hogan says that this allegation was not included in the original draft defence served in response to the letter before action; is not corroborated by the contemporaneous correspondence; and appears to be based on a telephone conversation between Mr Butler and Mr Messih on 10 th January 2002, of which there is no note. He describes MW's defence as not strong but says that, following the settlement with LMA, it would have been unjustifiable to have proceeded with the claim simply in order to establish Mr Messih's entitlement to his costs. Given the saving of court time and additional costs, it was appropriate, he said, for the claim against MW to be discontinued with no order for costs.
At the hearing of the application on 18 th December 2009 the Recorder took the same view. He said...
To continue reading
Request your trial
-
Nelson's Yard Management Company and Others v Nicholas Eziefula
...concerned the sixth principle. There is further guidance from this Court as to the approach to disapplying CPR Part 38.6(1) in Messih v MacMillan Williams [2010] EWCA Civ 844. I refer to this at [31]. But it is common ground between the parties that the principles set out in the Teasdale ca......
-
Convatec Ltd and Others v Smith and Nephew Ltd and Others
...the circumstances provides a good reason for departing from the rule. 33 Moore-B ick LJ then went on to deal with a later case, Messih v MacMillan Williams [2010] EWCA Civ 844, which had not been decided when this summary was prepared. In that case a claimant sued two defendants and obtaine......
-
Dainford Navigation Inc. v PDVSA Petroleo S.A
...to depart from the presumption imposed by CPR 38.6.” (2) The second important case was the decision of the Court of Appeal in Messih v MacMillan Williams [2010] EWCA Civ 844, the relevant parts of which are set out in the next authority. (3) That next authority is the case of Brookes v HSBC......
-
Conrad Morris v Troy Campbell
...were forced upon him and which the claimant is unwilling to carry through to judgment”. 34 The claimant in Messih v MacMillan Williams [2010] EWCA Civ 844 (‘ Messih’), brought proceedings against two firms of solicitors seeking damages for the loss of a commercial lease, which, he alleged, ......