Norman Robinson (Plaintiff) Respondent) v Roland Cowman Appellant)
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE DILLON,LORD JUSTICE RALPH GIBSON |
| Judgment Date | 17 March 1989 |
| Judgment citation (vLex) | [1989] EWCA Civ J0317-4 |
| Court | Court of Appeal (Civil Division) |
| Date | 17 March 1989 |
| Docket Number | 89/0294 |
[1989] EWCA Civ J0317-4
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
PRESTON DISTRICT REGISTRY
(HIS HONOUR JUDGE JOLLY, Sitting as a High Court Judge)
Royal Courts of Justice.
Lord Justice Dillon
and
Lord Justice Ralph Gibson
89/0294
1988 R. No. 61
MR. M. SULLIVAN (instructed by Messrs. Savage Crangle of Skipton) appeared on behalf of the (Plaintiff) Respondent.
MR. D. PORTER (instructed by Messrs. Lonsdales of Blackpool) appeared on behalf of the (Defendant) Appellant.
I will ask Lord Justice Ralph Gibson to give the first judgment.
On the 26th May, 1988 Mr. District Registrar Procter gave summary judgment for the plaintiff, Mr. Norman Robinson, under Order 14 for £9,853.36 together with interest against Mr. Roland Cowman, the defendant. The defendant appealed, and on the 8th July, 1988 His Honour Judge Jolly, sitting as a High Court judge, dismissed his appeal. The only order for costs was that the costs of the defendant were taxed under the Legal Aid Act. The defendant now appeals to this court asking that the summary judgment be set aside and that he be given unconditional leave to defend.
The plaintiff' claim endorsed on the writ, which was issued in January, 1988, was as follows:
"The Plaintiff's claim is for £9,532.33 being balance due under an agreement in writing made between the plaintiff and the defendant and outstanding at this date."
The affidavit in support of the application for summary judgment is not before the court, and I take it to have been in ordinary form. The defendant's first affidavit, sworn on the 20th May, 1988, contained the following assertions:
1. On the 24th October, 1983 the defendant purchased from the plaintiff the leasehold premises, goodwill, fixtures and fittings of 41a Tyldesley Road, Blackpool, for £48,000. The plaintiff lent to the defendant £40,000 of that total sum repayble over five years.
2. Just prior to the completion of that purchase in October 1983 the plaintiff said that the defendant must purchase the stock in the premises—we are told that they are shop premises—and that if the defendant did not agree the stock figure before the end of October 1983, the private mortgage loan of £40,000 would not be available and the transaction would not proceed.
3. The plaintiff prepared a handwritten document. It was described as "purporting to be a Promissory Note in the sum of £9,532.33 which allegedly reflected the stock valuation at the time of completion." The document was dated the 31st October, 1983 but the defendant may have signed it before completion.
4. The stock valuation was of items of fancy goods listed in a stockbook prepared by the plaintiff. The defendant accepted the plaintiff's word that the valuation figure was correct and that the future income from the business would be sufficient to repay both the private mortgage—that is, the £40,000 over five years—and the promissory note loan—that is, the £9,532.33—by October 1987, and provide a reasonable wage for the defendant and his wife. None of those representations was true, but the defendant "believed that there was a clear fraudulent misrepresentation regarding the stock", of which the majority was soiled, obsolete and of no value.
5. The business failed, and the plaintiff assigned the mortgage debt due from the defendant. Proceedings were served on the defendant—he said at that point at the end of 1987 but he has since said in 1986—and he surrendered the premises, including the business and stock then held.
6. The defendant had complained to the plaintiff about the stock, but the plaintiff was "far from helpful."
The defendant also produced a draft defence as an exhibit to that affidavit. It alleged that the defendant was induced to enter into the agreement "purporting to be a Promissory Note" by oral fraudulent misrepresentations by the plaintiff to the effect that the plaintiff's stock at 41a Tyldesley Road amounted to the value of the agreement. I take that to be a reference to the £9,532. I pause to comment that it was, in my opinion, plainly an inept pleading. For example, there was no damage alleged and no allegation of an intention to induce. I comment further that these are not merely technical points. If a pleading is not accurate, it causes those in charge of the case not to attend to the matters of evidence which are of central importance to the cause of action alleged.
A second affidavit was sworn by the defendant in July 1988—that is, the day before the hearing of the appeal by Judge Jolly. It exhibited the document which had been previously referred to as "purporting to be a promissory note". The paper is a piece of the printed writing paper of Lochdene Hotel in Blackpool. It is dated the 31st October, 1983 and reads:
"I Rowland Cowman…promise to pay Norman Robinson…the sum of £9,543.33 being the stock held by me at 41A Tyldesley Road, Blackpool."
The signature "R. Cowman" was written at the bottom with the date the 31st October, 1983, and at the top there was written above the text the words "To be paid in full by October 1987". That was signed also by Mr. Cowman with the date the 31st October, 1983.
The further allegation in this second affidavit can be summarised as follows. He said that prior to his completing the purchase of 41a Tyldesley Road on 24th October, 1983 he was required by the plaintiff to confirm that he would agree a price for the stock before the end of the month. On or about the 31st October the plaintiff told the defendant that the plaintiff and his wife had carried out a stock-take; that he had placed a value on the stock of £9,532.33; that such figure represented the wholesale price at which he had purchased the stock; and there was "set out there against such wholesale price for each such item of stock together with the retail price at which the same were for sale at the Premises". In doing so he "produced the stock book and held the same open for me at the page showing a total of £9,532.33". Then the affidavit continued to the effect that the plaintiff had operated his business on a cash basis, buying fancy goods from wholesalers in Manchester, and therefore there were no invoices for the defendant to check the wholesale price of the stock he was purchasing. So he had to rely on the wholesale price put forward by the plaintiff and was dependent upon him accurately setting it out. He was not able in the time available before the plaintiff was going to leave the country after the sale to do a physical stock-take for himself. He continued:
"Induced by what I had been told by the Plaintiff as to the price that he had paid for the stock and as to the retail prices thereof, and in reliance thereupon, I signed the document sued upon in this action on or about 31st October 1983."
He believed that that was after formal completion of his purchase of the premises but before he took possession of the same from the plaintiff. Whilst he did see the stock book on the occasion referred to, he only had the opportunity of glancing at it, and it was only some time later, and after he had taken actual possession of the premises, that he had the opportunity of looking at it in any detail. He said that actual possession was taken by him of the premises on or about the 24th October, but he corrected that by a later affidavit to 31st October. He referred to a complaint about some particular items of stock, and said that he had complained to the plaintiff about those items and his response was simply to say that his wife must have made a mistake and that he would be prepared for those items to be put in at a lower price. Thus, said the defendant, he understood him to mean that he would not insist upon full payment in October 1987 but would accept a reduction on the total price then promised to be paid.
The business had closed for winter at the end of October 1983, and it was not until shortly before Easter 1984, and the re-opening of the premises for the new season, that he had gone more thoroughly through the stock purchased. He discovered considerable discrepancies. It was clear that the wholesale price of many items had been over-priced and that the wholesale prices set out could not conceivably have been paid by the plaintiff. Certain boxes were empty which were supposed to have been full and other items were missing, etc. He said: "I verily believe that the value of the [stock] can have been worth no more than about £1,800." Having discovered these matters, he said that he got into contact with the plaintiff and he was told by the plaintiff that "he would straighten it all up at the end", i.e. in October 1987 when the final payment of this sum would be due. He said that it was for that reason that he did not further seek to challenge the document upon which he was sued.
He next introduced an issue which had been no more than hinted at in the first affidavit, namely misrepresentations as to the profitibility of the business he had purchased. They are set out in paragraphs 12, 13 and 14 at pages 58 and 64 of this affidavit. I do not propose to read them in full.
He placed before this court a new pleading which was not before the judge. It is a defence and counterclaim, and it is acknowledged that, if supported by credible averments of facts, it would constitute in law an arguable defence and counterclaim with reference to the claim made by the plaintiff. He put into his second affidavit also his financial circumstances, saying, in short, that he had no...
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