Nelson v Greening and Sykes (Builders) Ltd
| Jurisdiction | England & Wales |
| Judge | Lord Justice Lawrence Collins,Lord Justice Wall,Lord Justice Ward |
| Judgment Date | 18 December 2007 |
| Neutral Citation | [2007] EWCA Civ 1358 |
| Docket Number | Case No: A3/2007/0007 & 0008 |
| Court | Court of Appeal (Civil Division) |
| Date | 18 December 2007 |
[2007] EWCA Civ 1358
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM HIGH COURT OF JUSTICE
CHANCERY DIVISION
LEEDS DISTRICT REGISTRY
HIS HONOUR JUDGE LANGAN QC
Royal Courts of Justice
Strand, London, WC2A 2LL
Lord Justice Ward
Lord Justice Wall and
Lord Justice Lawrence Collins
Case No: A3/2007/0007 & 0008
Mr David Nelson appeared in person
Mr Geraint Jones QC (instructed through the General Council of the Bar Public Access Scheme) for Ms Shirene Hanley
Ms Sarah Richardson (instructed by Messrs Chadwick Lawrence) for Greening & Sykes (Builders) Limited
I Introduction
The management of Greening & Sykes (Builders) Limited (“G&S”) must be ruing the day in October 1997 when they agreed to sell a small building plot in Dewsbury, West Yorkshire, to David Nelson (“Mr Nelson”) for the modest sum of £38,500. As a result, they have been embroiled in ten years of litigation with Mr Nelson and his friend or associate Shirene Hanley (“Ms Hanley”).
Judge Langan QC described the litigation as “regrettably pointless” and, through no fault of G&S, “little more than an exercise in futility.” G&S have expended what their counsel estimated to be more than £100,000 in costs. The point on this appeal is whether they can recover some of the assessed costs awarded in their favour through a charge on the property or through a non-party costs order against Ms Hanley.
Ms Hanley threatened G&S's solicitors more than 7 years ago that “the matter between your client and me will become a long running saga along a costly course from Dewsbury to Strasbourg.”
These appeals by Mr Nelson and Ms Hanley concern, in the first place, the question whether G&S can enforce, against the property which they sold, some of the many costs orders which they obtained against Mr Nelson, none of which has been satisfied. In the light of the enormous cost to them of these proceedings, the amount which they seek to enforce is modest, about £18,000. That question concerns, primarily, the application of section 2(1)(b)(i) of the Charging Orders Act 1979 (“the 1979 Act”).
The second set of issues concerns the question whether G&S are entitled to a non-party costs order against Ms Hanley, and whether the judge was entitled to make an order that she pay the already assessed costs without giving her an opportunity to re-open the assessments. That question turns, in part, on the construction of section 51(3) of the Supreme Court Act 1981.
II The background
A contract was exchanged between G&S and Mr Nelson for the sale of a Plot 9, High Meadows, Low Road, Thornhill, Dewsbury (“the property”) on October 6, 1997 for £38,500.
Completion was due on about November 13, 1997. Mr Nelson required the transfer to be in the names of Ms Hanley and her daughter Dionne Hanley, and objected to the form of transfer put forward by G&S's solicitors. It seems that Mr Nelson took exception to certain covenants in the transfer and claimed that they had not been agreed as part of the contract.
On November 13, 1997 G&S's solicitors said that the transfer submitted by Mr Nelson was not acceptable, and that the new transferees were also not acceptable.
On November 17, 1997 Mr Nelson wrote to G&S to say that he had satisfied the purchase price of £38,500 (by paying a banker's draft for £35,300) and required by December 1, 1997 a duly executed transfer in the form executed by Ms Hanley and her daughter. On the same day G&S's solicitors wrote to Mr Nelson's solicitors to say that Mr Nelson had indicated that he had paid the sum of £37,000 direct to G&S's bank account and:
“if so this money will be held to your clients order pending formal completion. This leaves a shortfall of £1,000 which is to be held by ourselves pursuant to special condition 18 of the contract…”.
On November 19, 1997 G&S's solicitors served a formal notice to complete. Time for completion was subsequently extended to December 15, 1997. On January 2, 1998 Mr Nelson directed G&S to convey the property to Ms Hanley and her daughter within seven days in the terms of the accompanying transfer. G&S refused.
III The litigation
A The first action
On December 1, 1997 Mr Nelson issued proceedings seeking, inter alia, rectification of the contract and specific performance of the contract as rectified. The statement of claim in those proceedings were struck out by HH Judge Cooke on April 28, 1998 and Mr Nelson was ordered to pay G&S's costs.
B The second action and judgment of Mr Robert Englehart QC
On October 28, 1998 Mr Nelson issued another set of proceedings against G&S claiming that the contract with G&S did not comply with section 2(1) of the Law of Property (Miscellaneous Provisions) Act 1989, but that G&S were bound by a proprietary estoppel in favour of Mr Nelson which required G&S to transfer the property (free of any of the terms of the transfer) to Mr Nelson or his nominees.
This matter came before Mr Robert Englehart QC (sitting as a High Court Judge) who gave judgment on February 2, 2000. The judge said:
“It must be said at the outset that the legal expense to which this dispute has given rise is out of all proportion to the subject matter of the dispute and indeed the total value of this property. … One cannot help but feel that with a modicum of good sense the dispute could and should have long since been resolved by agreement.”
The judge said that the problem had arisen because Mr Nelson had resolutely refused to accept the engrossed form of transfer tendered by G&S's solicitors, because he objected to many of its conditions and wished to have a transfer to Ms Hanley and her daughter. The judge decided that there was no doubt that what both Mr Nelson and G&S intended to be annexed was the form of transfer supplied by G&S's solicitors. He found that the terms and form of the transfer were those put forward by G&S and ordered specific performance. Mr Nelson was to execute a transfer in the terms as scheduled. Alternatively he could procure that Ms Hanley and her daughter execute the transfer in that form. Mr Nelson was also ordered to pay G&S's costs, less a deduction of £1,000.
C G&S's application to set aside the order of Mr Robert Englehart QC
Despite this order Mr Nelson refused to execute the transfer or to procure that Ms Hanley and her daughter executed the transfer.
Instead, on July 12, 2000 Ms Hanley wrote to G&S's solicitors to say that she had provided the purchase price for the property, and had owned the land since 1997 but had not been given possession. Her ownership derived from her having provided the purchase price. She called upon G&S to transfer the legal title. G&S's solicitors said that her position was not agreed, and on August 3, 2000 she wrote to say that if they were unable or unwilling to recognise her title “the matter between your client and me will become a long running saga along a costly course from Dewsbury to Strasbourg.”
When Mr Nelson refused to complete either in his own name or by his nominees, G&S sought an order to set aside the order for specific performance on the ground that Mr Nelson had failed to comply.
Ms Hanley also commenced proceedings against G&S on July 1, 2002 for an injunction restraining G&S from preventing or obstructing access by her or her contractors or agents to the property. An interim injunction was refused by Judge McGonigal on July 2, 2002.
These matters came before Etherton J in November 2002, when, as an alternative to the primary relief sought by G&S, namely that the order for specific performance be set aside, an order was sought by G&S that a Master, or some other fit and proper person, execute a transfer of the property on behalf of Mr Nelson in order to give effect to the order for specific performance.
Etherton J accepted that the purchase price was funded entirely by Ms Hanley. He said (paras 25, 31):
“I find the stance taken by Ms Hanley and Mr Nelson quite baffling, both in relation to their conduct and in relation to their submissions of law. I remain wholly perplexed as to why it is that since the order of Mr Englehart QC, made over two and half years ago, Mr Nelson has persistently refused to comply with the order for specific performance bearing in mind that it is Mr Nelson's own case before me that the Property, for which Ms Hanley, through Mr Nelson, has paid under £40,000, is now worth in excess £90,000 on a forced sale basis. None of the evidence before me explains this extraordinary conduct.
…
It is perfectly clear that Ms Hanley who, for reasons which have never been explained in evidence, used Mr Nelson as a conduit for the payment of the purchase price and the acquisition of the property, has at all times been aware of, and been behind, the persistent failure of Mr Nelson to execute the transfer in the appropriate form.”
He said that he bore in mind that it was open to G&S to apply for a costs order against Ms Hanley on the basis that in reality Mr Nelson was acting on her behalf and at her behest. Bearing in mind that discharging the order for specific performance might give a substantial financial windfall to G&S, and that Ms Hanley had indicated that she was willing to take a transfer, he directed that a Master should sign the transfer on behalf of Mr Nelson. He dismissed Ms Hanley's proceedings. He ordered Ms Hanley and Mr Nelson to pay 85% of G&S's costs.
The transfer was signed by Master...
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