Schwarzschild v Harrods Ltd
| Jurisdiction | England & Wales |
| Judge | THE HONOURABLE MR JUSTICE EADY,Mr Justice Eady : |
| Judgment Date | 19 March 2008 |
| Neutral Citation | [2008] EWHC 521 (QB) |
| Docket Number | Case No: QB/2007/APP/0674 |
| Court | Queen's Bench Division |
| Date | 19 March 2008 |
[2008] EWHC 521 (QB)
IN THE HIGH COURT OF JUSTICE
On Appeal from Master Yoxall
QUEEN'S BENCH DIVISION
The Honourable Mr Justice Eady
Case No: QB/2007/APP/0674
Stuart Isaacs QC and William Willson (instructed by Watson & Brown) for the Appellant/Claimant
Ian Croxford QC and Andrew Mold (instructed by Lewis Silkin LLP) for the Respondent/Defendant
Hearing dates: 11 —12 March 2008
Approved Judgment
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
Introduction
This litigation commenced by the issue of proceedings on 21 September 2006. The Claimant is Ms Helga Schwarzschild, who alleges against Harrods Limited the tort of conversion in accordance with s.2(2) of the Torts (Interference with Goods) Act 1977. The claim relates to certain personal items (principally jewellery) which she inherited and which for many years remained in a safe deposit box on the Defendant's premises. The Claimant's affairs are now conducted by her accountant, Ms Kay Linnell, pursuant to a power of attorney.
The proceedings were served on 12 January 2007 and were met, on 30 April 2007, with an application that the claim be struck out, or alternatively that summary judgment be granted in the Defendant's favour, on the basis that it was time-barred. Following a hearing on 18 June of last year, Master Yoxall handed down a reserved judgment on 9 October and granted the Defendant summary judgment. That outcome is now challenged by the Claimant by way of appeal, for which I granted permission on 21 December.
The background
It is necessary to consider the factual background in a little detail. In 1955 the Claimant's mother, Lea Schwarzschild, entered into an agreement with the Defendant for the rental of a safe deposit box. It was one of the terms of the contract that the annual rent should be payable in advance; in the event that it remained unpaid for five years, the Defendant would be entitled to open the deposit box and sell any contents, with a view to clearing the outstanding rent and any sale charges. The balance would be payable to the owner.
On 16 October 1970 the Claimant's mother died. In accordance with her will, dated 12 June 1967, most of her jewellery was left to the Claimant, although some items were bequeathed to her brother Charles. When he died on 26 April 1988, his assets were left to the Claimant in accordance with his will of 3 October 1986. Thus the Claimant became entitled to all of the property contained in the safe deposit box.
Meanwhile, it seems that rental payments had ceased in about 1983. It is agreed between the parties that on 9 August 1988 the Defendant opened the box and removed the metal container stored inside. Once a list had been made of the contents (now before the Court in evidence) the items were replaced in the container, which the Defendant continued to store. It was opened again on about 8 August 1994, when a further inspection took place and another list was made. At that stage, it is said on the Defendant's behalf that the items were mixed with the contents of other safe deposit boxes (in respect of which rental payments were owing) and stored with them.
It is part of the Claimant's pleaded case, in paragraph 4 of the Reply, although not relied upon apparently as being an ingredient in her cause of action, that when the container was opened, in August 1994, “Mr Mohammed Al Fayed and his wife, Heini Al Fayed, were present. Mrs Al Fayed made a selection of items from the container for her own use which Mr Al Fayed directed to be sent up to his office”. The assertion appears to have originated with a disenchanted employee called Mr Loftus. At the material time Mr Al Fayed was the chairman of the Defendant company, although his wife was not an officer or employee. I shall need in due course to consider what bearing (if any) these events have upon the issues now before me.
By letter dated 31 August 1995 a private investigator acting on the Claimant's behalf (Mr Nathan Dony) made enquiries of the Defendant as to the contents of the safe deposit box. There was sent in reply a letter of 5 September 1995, of which the contents have subsequently been admitted to be inaccurate (and indeed, at one stage, “dishonest”). While it was accepted that the Defendant had rented out a safe deposit box, it was also suggested that it had no idea as to the whereabouts of the contents. In truth, the Defendant was aware that the box had been opened in 1988 and again in 1994 and that the items had been mixed with other property. So much is clear from the evidence of Mr Thomas Coates, on the Defendant's behalf, in his witness statements of 30 April and 11 June 2007.
Time went by and no further information was supplied. Against that background, there was a further letter from Mr Dony dated 13 December 1997, the contents of which are rather oddly worded and have led to disagreement between the parties as to its legal significance. The Master upheld the Defendant's submissions in this regard and concluded that it contained an unequivocal demand for the delivery up of the jewellery. It is thus necessary to set out the relevant wording:
“I now make a formal demand for an immediate commencement of the process to return my client's jewellery and you must now indicate in the clearest possible terms without delay, obfuscation or economy of truth whether:—
(i) You have my client's jewellery.
(ii) You are prepared to let my client have it back.
(iii) You will abide by my conditions as to its hand-over.
(iv) You can indicate the time frame in which you will carry out the above points, if at all.
I must caution you that failure to deal with my letter and to reply in a meaningful fashion, will obviously be regarded in the only possible way, as intent to deprive permanently, i.e. theft.”
The letter had set out something of the background and contained the suggestion that Mr Dony had hitherto been given “interminable run-arounds” by a Ms Louisa Michelson. The letter has to be construed, therefore, against that background and that of the earlier exchange of correspondence.
What Mr Dony meant by his “conditions” was also set out. He was stipulating that the Claimant and he, together with a legal representative and an independent jeweller of their choice, would attend at Harrods or some other place of the Defendant's choosing. He added:
“We do not simply want a package hand delivered or posted to anyone. As to the issue of any outstanding fee or rental arrears, if you let me know the amount in advance I will bring a Bankers Draft or cash.
You may think that I am being pre-emptive as to whether the jewellery exists or is in your hands.”
It is part of the Claimant's case that this letter did not contain, when read in its proper context, an unequivocal demand for delivery up of her jewellery, but merely a demand for the “commencement of the process” to return it. It is pointed out that Mr Dony apparently had no idea what it was, specifically, that he was seeking, and the letter itself gave no particulars as to the individual items.
Even if, as the Master concluded, Mr Dony's letter of 13 December 1997 should be construed as an unequivocal demand, other ingredients would be required to establish a cause of action in conversion dating back to the relevant time (i.e. more than six years prior to the issue of the claim form). It would be necessary (so the Claimant submits) to demonstrate that there had also been an unequivocal refusal by the Defendant to return the property demanded. Although it is accepted that the property was not in fact returned at any stage, reliance is placed on the absence of any response to Mr Dony's letter which could be characterised as a refusal. There were three letters from the Defendant's solicitors, dated respectively 18 December 1997, 19 January 1998 and 21 January 1998, which are said by the Claimant to be no more than requests for further information.
After further delay, there took place a meeting on 23 September 1998, which is said on the Claimant's behalf to have been without prejudice, at which an inspection took place of various mixed items then in the Defendant's possession. Those present included the Claimant and her accountant, Ms Kay Linnell, and, on the other side, representatives of the Defendant and its solicitors. Because it is suggested that no privilege has been waived in respect of the meeting, the Claimant contends that the Master was wrong to have received any evidence as to what took place on that occasion.
There is, in any event, a dispute as to what actually took place. The Master was not therefore in a position to come to a definitive conclusion about it. Yet he apparently attached significance to it in at least two respects. He seems, first, to have decided that because of the meeting there was no need any longer for it to be demonstrated that the Defendant had responded to Mr Dony's demand with an unequivocal refusal. Secondly, he appears to have inferred that, at or after the meeting, the Claimant acquired knowledge that the jewellery had been lost (or at least some part of it) and that a cause of action in conversion had come about. He regarded that as important for limitation purposes. It is the Defendant's case that time began to run from that point at the latest.
The Claimant, on the other hand, relies upon demands made within the six-year period; that is to say, by a solicitor's letter of 4 September 2001, demanding delivery up of the items identified in the letter itself, and a letter from a different solicitor...
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