Scribes West Ltd v Relsa Anstalt
| Jurisdiction | England & Wales |
| Judge | Lord Justice Brooke,Lord Justice Mance,Lord Justice Dyson |
| Judgment Date | 20 July 2004 |
| Neutral Citation | [2004] EWCA Civ 965 |
| Date | 20 July 2004 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | Case No: B2/2003/2010 CCRTF |
[2004] EWCA Civ 965
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM CENTRAL LONDON COUNTY COURT
Judge Mayer
Royal Courts of Justice
Strand,
London, WC2A 2LL
Lord Justice Brooke
Vice-President of The Court of Appeal (Civil Division)
Lord Justice Mance and
Lord Justice Dyson
Case No: B2/2003/2010 CCRTF
Tom Weekes (instructed by Mischcon de Reya) for the Appellant
Andrew Bruce (instructed by Richards Butler) for the Respondent
This matter was listed before us for a ruling on a jurisdictional issue.
The claimants, Scribes West Ltd, were the lessees of business premises on the ground floor and basement of the Barkers Centre, Kensington, pursuant to the terms of a lease dated 25 thJanuary 1991 which was granted to them by House of Fraser plc. The first defendants Relsa Ansalt (whom I will call "RA") were registered as the freehold proprietors of the premises on 10 th November 1993.
The claimants ceased trading on 1 st May 1997, being the day on which they were granted a licence to assign the lease to London Sportsman's Club Limited (whom I will call "LSC"), and on which they also entered into a second charge over the leased premises to secure a loan they had made to LSC. In November 1999 the claimants entered into a voluntary arrangement with their creditors.
On 28 th February 2001 the defendants assigned their reversionary interest to Relsa Barkers Limited, (whom I will call "RB"), pursuant to the terms of a transfer document which was described as " TR1". On the same day RB gave notice to LSC of the assignment and required them to pay the rent to them. On 16 th July 2001 RB peaceably re-entered the premises on the grounds of arrears of rent. On 25 th July 2001 RB granted a new lease of the premises to a company called Settle Up Limited (whom I will call "Settle Up") .
For the purposes of deciding the jurisdictional issue it is unnecessary to say any more about the facts. The present proceedings were commenced on 19 th December 2001 and were constituted as an action by the claimants against RA claiming relief from forfeiture. The claimants' interest derived from their status as chargees of the valuable security constituted by the lease.
On 23rd February 2002 District Judge Madge allocated the action to the multi-track and joined Settle Up as second defendants.
On 19 th July 2002 the claimants made an application to amend their particulars of claim and to join a number of new parties to the proceedings. By the proposed amendment they also sought a declaration that RB's peaceable re-entry was ineffective to forfeit the lease, as an alternative to their claim for relief from forfeiture. Their application notice contained an application for a "declaration that the proposed grant of a lease to the Second Defendant was ineffective or alternatively a declaration that the lease has not been forfeited, or that relief from forfeiture be granted." It did not, however, comply with paragraph 2((2) of the Practice Direction to Part 24, although an accompanying witness statement indicated that it was intended to be an application for summary judgment. At all events RA did not recognise it as such, and did not file any evidence in response to it.
On 24 th March 2003 RA applied for an order striking out the claim, alternatively for summary judgment, on the grounds that the claimants' claim – and their proposed amended claim—were misconceived. Their case was based on the contention that they had assigned the right to rent to RB who in turn were entitled to forfeit the lease pursuant to section 141(2) of the Law of Property Act 1925. They also contended that delay should prevent the claimants from obtaining relief from forfeiture. Alternatively they sought to strike out the claim on procedural grounds, but they did not pursue that part of their application before the judge.
On 7 th April 2003 District Judge Price directed that both sides' applications should be listed for hearing before a circuit judge, together with another application which need not concern us. Although he directed a timetable for the service of the claimants' evidence in response to RA's application, he made no such direction in relation the claimants' application. It was by this route that the two applications came to be decided by Judge Mayer, sitting for the purpose in the Barnet County Court.
The first day of the hearing, in which the claimants and RA were both represented by leading counsel, was on 28 th May 2003. The skeleton argument filed by RA's leading counsel before the hearing betrayed no awareness that the claimants were seeking summary judgment on the prayer to their Amended Particulars of Claim at the same time as they were seeking permission to amend. The claimants' wishes in this regard seem to have been clarified at the hearing on 28 th May, and in the interval between 28 th May and 2 nd July, when the hearing resumed, the claimants filed and served a second skeleton argument to which RA responded. This supplementary skeleton argument, which was said to be submitted on behalf of both RA and RB (even though RB was not a party to the action), contained in paragraph 2 the following statement:
"The First Defendant has been able to serve additional evidence. That evidence is also attached to this skeleton. Subject to that evidence being admitted, the First Defendant and [RB] will not object to the above question being finally determined as between all relevant parties."
The hearing then resumed on 2 nd July 2003 with nobody apparently paying much attention to procedural niceties. In much the same way as the claimants' initial application had been ineptly drafted (I leave on one side the question whether a party can seek to amend its statement of case and seek summary judgment on the amended statement of case at one and the same time), nobody seems to have addressed the question whether RA was now accepting that the hearing included an application for summary judgment, or was acquiescing in an unformulated proposal that the judge was instead being invited to try an issue on the amended pleading pursuant to CPR 3.1 (2) (i) – or, possibly, CPR 3.1 (2) (m) . But the judge could not do this unless she granted permission to amend, with the effect that the requested declaration would bind not only RB and RA but also the second defendants Settle Up; and also LSC and a Mr Lewis (who also had an interest as a chargee) . We were told that LSC and Mr Lewis, who were among the parties whom the claimants sought to join to the proceedings, had written letters to the court (or to the parties?), but we were not shown those letters, and the court certainly had no power to make a declaration which could bind them in respect of their interests without them first being formally joined to the proceedings and being given notice of the declaration it was sought to make. Settle Up were trading from the premises under the new lease which had been granted to them by RB in July 2001, and they had instructed a solicitor to look after their interests in court, although he did not play an active part in the proceedings.
On 26 th August 2003 the judge delivered a reserved judgment. Its opening paragraph was in these terms:
"… I am asked to decide essentially whether a lease could be forfeited by a landlord who does not hold the reversionary interest, the latter not having been registered in the Land Registry at the relevant time. Subject to my decision on this point there are procedural issues I have to deal with."
In paragraphs 3–19 she set out a chronology of events. In paragraph 14 she described the claimants' application dated 19 th July 2002 as including an application for summary judgment on a declaration that the lease was extant. The rest of this narrative betrayed no understanding that she was deciding a preliminary issue in the action. Paragraphs 20–50 contained the judge's analysis of the interesting legal issues in the case (which had warranted the retention of leading counsel on both sides) . She made it clear that she preferred the defendant's submissions. Her judgment ended in this way:
"51. I therefore, find: (1) RB were entitled to the rent from LSC pursuant to the TR1 and (2) RB were entitled to re-enter and forfeit the lease on 16 th July 2001 and, having done so, the lease is no longer extant. The only remedy available to the claimants is an application for relief from forfeit pursuant to section 146 of the Law of Property Act 1925. This application is still outstanding.
52. I now turn to deal with the individual applications before me: (1) I refuse the claimants' application for permission to amend the particulars of claim; similarly, I refuse joining any further defendants to this claim; (2) I strike out the claim against the first defendant, RA, and I substitute RB for RA as first defendant. As I have already said, the only outstanding application, therefore, remaining is the claimants' application for relief from forfeit. That hearing I adjourn to another time and transfer it back to the Central London County Court.
53. I adjourn the hearing for hearing submissions about the final order and about costs; written submissions from both parties on the above by 9 September 2003."
On 17 th September, after considering the parties' submissions, she decided to direct that the claim should be struck out after all. She gave her reasons for taking that course, and said that she had concluded that the correct course was to strike out the entirety of the present proceedings.
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