Millican v Tucker
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE BUCKLEY,LORD JUSTICE DONALDSON |
| Judgment Date | 23 January 1980 |
| Judgment citation (vLex) | [1980] EWCA Civ J0123-5 |
| Date | 23 January 1980 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | 1975 M No. 6262 |
[1980] EWCA Civ J0123-5
In The Supreme Court of Judicature
Court of Appeal
(Civil Division)
On Appeal from the High Court of Justice
Chancery Division
Group B
(Mr. Justice Browne-Wilkinson)
Lord Justice Buckley
and
Lord Justice Donaldson
MR. DUNCAN MATHESON (instructed by the Area Secretary, The Law Society, No. 13 (London East) Legal Aid Area, 29/37, Red Lion Street, London WC1R 4PP) appeared on behalf of the Law Society (Appellants).
MR. W. H. GOODHART Q. C. (instructed by Messrs. Bartlett & Gluckstein, Crawley & de Reya, Solicitors, London WIV OAT) appeared on behalf of the Plaintiffs (Respondents).
I have asked Lord Justice Donaldson to deliver the first judgment in this case.
In this appeal the Legal Aid Fund challenges an order for costs made against it by Mr. Justice Browne-Wilkinson. The plaintiffs were coal miners and part time entertainers. In 1973 they appeared on more than one occasion as singers on the television programme "Opportunity Knocks". They were a great success. This success did not pass unnoticed. Mr. Tucker and Mr. Houlihan, defendants in the action, decided that they would share in that success. They induced the plaintiffs to appoint them as managers for a year. Under this contract the defendants' remuneration was no less than 30 per cent of the plaintiffs' gross receipts.
The plaintiffs greatly impressed the learned judge as men of the highest integrity - men whom the judge said that he admired in every way. Unfortunately (and this is no criticism of them) they lacked all "business acumen. This led them not only to accept the original management contract, but also a suggestion from the defendants that this should be superseded by another contract under which the defendants received 35 per cent of the plaintiffs' gross receipts for a period of 3 years. But even this did not satisfy the defendants. They negotiated a contract with Pye, under which a large sum was paid to them on behalf of the plaintiffs as advance royalties. They then formed a company, Mardistar Ltd., in which the plaintiffs had only a 60 per cent interest, later reduced to a minority interest The remaining shareholders were, of course, the individual defendants. The plaintiffs were induced to agree that what remained of their gross earnings after paying the 35 per cent managementfee would be paid to Mardistar Ltd. in exchange for a salary of £10 per week, and that this arrangement should continue for 5 years.
The plaintiffs eventually took legal advice. As a result they sued Mr. Tucker, Mr. Houlihan and Mardistar Ltd. For declarations that the second management contract and the contract with Mardistar had been induced by oppression and fraud and were not binding on them. They also claimed an account of all sums received by the defendants on their behalf. Pending the trial of the action they took such steps as were open to them to ensure that they and not the defendants received fees payable to them in respect of their activities as entertainers.
The individual defendants obtained legal aid. In April 1976 they delivered a defence denying all the plaintiffs' allegations. A year later Mr. Tucker obtained an extension of his legal aid certificate entitling him to counterclaim against the plaintiffs. The defence was then amended and a counterclaim delivered. By the counterclaim Mr. Tucker sought a declaration that the second management contract was binding. The company, for its part, sought a similar declaration that its contract was binding. Both Mr. Tucker and the company also claimed an account from the plaintiffs. At the trial Mr. Tucker added an alternative counterclaim foa? remuneration on the basis of a quantum meruit.
The hearing began in March 1979, but after two adjournments, the dispute was settled. The plaintiffs withdrew their allegations of fraud, but, subject to that, the settlement amounted to a total surrender by the defendants. But it was a hollow victory. The three-year life of the second management contracthad already expired and the Mardistar contract was due to expire shortly. The large sums of money received "by the defendants had evaporated. Mardistar was insolvent and the plaintiffs had to accept a judgment against the individual defendants for no more than £2,000. Against this they had incurred costs amounting to between £6,000 and £7,000, and, the defendants being legally aided with nil contributions, no part of these costs could be recovered from them. In addition, the plaintiffs were faced with a claim by Pye's for the repayment of £8,000 of advance royalties - money which had gone to the defendants. As the judge rightly said, it was a very hard case.
In these circumstances, the plaintiffs sought an order for costs against the Legal Aid Fund under section 13 of the Legal Aid Act, 1974. They were successful. The learned judge ordered the payment by the Fund of the plaintiffs' costs of the counterclaim and directed that in taxing those costs, the costs incurred after the date of the counterclaim on issues common to both claim and counterclaim should be divided equally between the costs of the claim and those of the counterclaim. The Legal Aid Fund now challenges the jurisdiction of the judge to make this order.
Let it be said at once, as the judge himself said, that there is no criticism of the Law Society for granting legal aid to the defendants. At the stage at which legal aid had to be granted or refused, those concerned did not know the true facts. They had to rely upon what they were told by the defendants.
The making of an order for costs against the Legal Aid Fund at first instance is exceptional, because no less than sixconditions have to be satisfied. These are as follows:
(1) The proceeding in the Court of first instance must have been started by the assisted party. It is now accepted that this condition is met in that the counterclaim, which was instituted by Mr. Tucker, is to be regarded as a proceeding separate from the claim.
(2) The unassisted party must have succeeded. The counterclaim was settled by abandonment, but it is accepted that this constituted success by the plaintiffs for the purposes of the section.
(3) The Court must have considered what order for costs should be made against the assisted party. The learned judge did so and decided that no order for costs should be made, because Mr. Tucker was an assisted person with a nil contribution.
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