Nolan v Wright
| Jurisdiction | England & Wales |
| Judge | Lord Justice Lloyd |
| Judgment Date | 15 October 2009 |
| Neutral Citation | [2009] EWCA Civ 1131 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | Case No: A3/2009/0603 Z |
| Date | 15 October 2009 |
[2009] EWCA Civ 1131
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
CHANCERY DIVISION, MANCHESTER DISTRICT REGISTRY
(HIS HONOUR JUDGE HODGE Q.C.)
Royal Courts of Justice
Strand, London, WC2A 2LL
Lord Justice Lloyd
Case No: A3/2009/0603 Z
Mr Clive Freedman QC & Mr Pepin Aslett (instructed by Messrs Bishop and Co) appeared on behalf of the Appellant
THE RESPONDENT DID NOT APPEAR AND WAS NOT REPRESENTED
(As Approved)
This is the oral renewal of an application for permission to appeal against orders of HHJ Hodge Q.C., sitting as a judge of the Chancery Division in Manchester on 26 February. There are two aspects to the appeal: one is against one feature of his order on the substantive position, so to speak, and the other aspect concerns his order as to costs.
The judge's judgment on the substantive issue before him was on an appeal. District Judge Needham had refused to give summary judgment for the claimant. The claimant appealed against that. In the course of preparation for the appeal a preliminary issue was ordered on certain limitation points. These had been ventilated before the district judge. I am sure it was right and convenient that these should be identified for separate decision either way, whether or not summary judgment should be granted. The judge's judgment on the substantive matter is [2009] EWHC 305 (Ch) and that was a reserved judgment. His judgment on costs is not separately reported, but I have a transcript of it. The appeal, as I say, is in one respect on substance and in other respects on costs. One of the grounds of appeal on costs is a point on which Patten LJ granted permission to appeal when he considered the papers on 17 July this year.
The action is for the recovery of a very large sum of money from the defendant borrower pursuant to an unregulated credit agreement and a legal charge. The defendant seeks to set aside the loan documentation as a sham or procured by undue influence or misrepresentation. He also sought to have the loan documentation set aside or re-opened as an extortionate credit bargain under the Consumer Credit Act 1974. A number of items of conduct on the part of the claimant were alleged. The preliminary issue was as to whether the claim to re-open the credit agreement as an extortionate credit bargain was statute barred under section 8 of the Limitation Act. There was also a defence that the claimant's own claim was barred by limitation.
The judge in his reported judgment held that the extortionate credit bargain claim was subject to a 12-year limitation claim and it was out of time, subject only to one point. In the rejoinder to the reply and the reply to the defence to counterclaim, Mr Nolan, the claimant, having said in his defence to the counterclaim that the extortionate credit bargain claim was barred by limitation, Mr Wright, the defendant, said that he would rely if necessary on the provisions of section 32 of the Limitation Act and would say that the defendant's counterclaim is based on the fraud of the claimant or that the facts relevant to the right of action had been deliberately concealed from him by the claimant. The pleading sets out briefly the case in that respect. It says that they were sham documents and that there was a fraud. Plainly if it was a sham document then it is not an enforceable document and it is unnecessary to rely on limitation because no rights will arise from the document.
Equally if the document was procured by fraud it would be set aside and the question would arise under section 32. The judge dealt with this at paragraph 19 of his judgment on the substantive issues. He says he accepted Mr Freedman's submission, then, as before me, for the claimant, that this is not an action based on the claimant's fraud nor is it one for a relief from the consequences of a mistake. He said:
“On the basis of the material which is presently before me, I confess to some difficulty in understanding how the defendant can realistically assert that any fact relevant to his right to reopen the credit agreement as an extortionate credit bargain was deliberately concealed from him by the claimant so as to enable him to invoke paragraph (b) section 32 (1): either his claim that the loan documentation was a sham succeeds (in which event there is no credit agreement to reopen), or it fails (in which event the factual basis for a plea of deliberate concealment is missing). Similar reasoning applies to the defendant's allegations of deceit and undue influence which, if successful, would lead to the setting aside of the loan agreement. It also seems to me that the defendant may find it difficult to resist the conclusion that, with reasonable diligence, he could have discovered any fraud, concealment or mistake in or about October 1995 when his solicitors, Inesons, received the correspondence and loan statement from the claimant which tended to indicate that he...
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