SCT Finance Ltd v John Bolton
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE WALLER,Mr Justice Wilson,MR JUSTICE WILSON,Lord Justice Waller,LORD JUSTICE RIX |
| Judgment Date | 16 January 2002 |
| Neutral Citation | [2002] EWCA Civ 56 |
| Court | Court of Appeal (Civil Division) |
| Date | 16 January 2002 |
[2002] EWCA Civ 56
Lord Justice Waller
Lord Justice Rix and
Mr Justice Wilson
IN THE SUPREME COURT OF JUDICATURE B1/2001/0710
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM READING COUNTY COURT
(HIS HONOUR JUDGE ELLY)
Royal Courts of Justice
Strand
London WC2
MISS R BAILEY (instructed by Sechiari, Clark & Mitchell, Cardiff CF24 OSR) appeared on behalf of the Appellant.
THE RESPONDENT appeared in person.
Wednesday 16th January 2002
I will ask Mr Justice Wilson to deliver the first judgment.
This is an appeal brought with leave of the single Lord Justice from the county court in relation to costs. As such, it is overcast, from start to finish, by the heavy burden faced by any appellant in establishing that the judge's decision falls outside the discretion in relation to costs conferred upon him under rule 44.3(1) of the Civil Procedure Rules 1998. For reasons of general policy, namely that it is undesirable for further costs to be incurred in arguing about costs, this court discourages such appeals by interpreting such discretion very widely.
The appeal is brought by SCT Finance Ltd ("the hire purchase company") from the order of his Honour Judge Elly in the Reading County Court on 9 March 2001. Before the judge were proceedings brought by the hire purchase company against Mr Bolton, who, in April 1995, had bought from it a car on terms as to hire purchase. As a result of a counterclaim made by Mr Bolton, the hire purchase company issued a Part 20 claim against WR Hammant Ltd ("the dealers") through whom Mr Bolton had bought the car. As a result of the Part 20 claim against them, the dealers in turn issued a Part 20 claim against Volkswagen Group UK Ltd ("the distributors") who had sold the car to them.
The substantive result of the proceedings, against which there is no appeal, was that judgment be given on the claim by the hire purchase company against Mr Bolton in the sum of £351; and that the counterclaim and the two successive claims under Part 20 be dismissed. Then came the orders for costs. They were:
(a) that the distributors' costs be paid by the dealers, subject to detailed assessment on the standard basis;
(b) that the dealers' costs be paid by the hire purchase company, subject to detailed assessment on the standard basis and so as to include the costs payable by the dealers pursuant to (a); and
(c) that the hire purchase company's costs be paid by Mr Bolton, subject to detailed assessment on the standard basis and so as to include the costs payable by the hire purchase company pursuant to (b) but subject also to
(i) postponement referable to costs incurred while Mr Bolton was in receipt of public funds for the prosecution of his counterclaim; and
(ii) an overall ceiling of £15,000.
The hire purchase company accepts the validity of the limitation at (i), made pursuant to what is now s.11 Access to Justice Act 1999. Mr Bolton appears to have been publicly funded for the prosecution of his counterclaim between about November 1999 and February 2000, namely before the vast bulk of the costs had been incurred by any of the other parties. So the hire purchase company does not expect that the effect of that limitation will be to postpone recovery of any significant amount of its costs. Its appeal is against the limitation at (ii), namely the overall ceiling of £15,000. In circumstances in which the estimates placed before the judge of the costs of the distributors were about £18,000, of the dealers were about £24,000 and of the hire purchase company itself referable to the counterclaim were about £9,000, the hire purchase company alleges that, in imposing a ceiling of £15,000 upon its recovery against Mr Bolton, the judge exceeded the generous ambit of his discretion.
The story begins in April 1995 when Mr Bolton informed the dealers that he wanted to buy a new Seat Cordoba 1.6 CLX motor car on hire purchase. Seat cars are manufactured in Spain, in effect by Volkswagen. The dealers arranged the purchase through the hire purchase company. So the dealers bought the car from the distributors and sold it to the hire purchase company, who leased it to Mr Bolton; and in May 1995 Mr Bolton took delivery of it. It had then travelled 30 miles.
Mr Bolton, including his family, used the car extensively. By May 1996 he had travelled over 21,000 miles in it; and by May 2000 he had travelled 110,000 miles in it.
In the years following his acquisition of the car, Mr Bolton had a number of problems with its brakes. Inspections and repairs were undertaken. Late in 1996 he complained to the dealers about an alleged design fault in the brakes. The dealers caused an officer of the distributors' technical division to inspect it. There the matter seemed to rest.
In January 1998 Mr Bolton ceased to make his monthly payments to the hire purchase company. He had come to the view that the new car which he had contracted to buy in April 1995 on hire purchase should have been fitted with an air bag and an air conditioning unit. By letter dated 14 May 1998, Seat UK disabused him of the validity of that view. But, erroneously (as it was later to transpire), it added that, though bought in April 1995, the car that was sold to him would have been built to the specification set in June 1994. Mr Bolton later discovered that under such specification the car should have been fitted with a sun roof and with a driver's seat the height of which was adjustable. In the interim, however, namely with effect from July 1998, he resumed payments to the hire purchase company. He again stopped making such payments in January 1999.
In July 1999 the hire purchase company issued the proceedings against Mr Bolton in the Reading County Court in respect of arrears of instalments. The claim was for £917. By his defence in August 1999, Mr Bolton correctly pointed out that there had been a duplication in the calculation of the claim amounting to £266, which reduced it to £651. Indeed, following the issue of the proceedings, he paid a further £300 against what was owed, thereby reducing it to £351. More importantly Mr Bolton filed a counterclaim for damages not exceeding £10,000, by which he claimed that:
(a) in lacking a sun roof and an adjustable driver's seat, the car was not in accordance with the specification for which he had contracted; and
(b) in relation to problems with the brakes, rear wheel bearings and wiring faults in the boot, the car had been neither of merchantable quality nor fit for its purpose at the time of its acquisition in 1995.
The hire purchase company filed a defence to the counterclaim. For obvious reasons it had no internal knowledge of the matters raised in the counterclaim. Before, however, issuing proceedings under Part 20 against the dealers, it sought to compromise the litigation with Mr Bolton. By letters in January 2000, expressly made under Part 36 of the Rules of 1998, Mr Bolton, through his then solicitors, offered to settle the litigation for a net payment to him of £3,000 and, by contrast, the hire purchase company offered to settle it on the basis that neither party should make any payment to the other. Neither offer was acceptable to the other. Thereupon, namely in April 2000, the hire purchase company issued Part 20 proceedings against the dealers. This move prompted the proceedings issued in July 2000 by the dealers, again under Part 20, against the distributors. By these successive proceedings, Mr Bolton's complaints about the nature and quality of the car which he had acquired over four years earlier were passed down the contractual line for the distributors to answer.
Following issue of its proceedings, the hire purchase company's claim had been allocated to the fast track. In July 2000, however, that company, apparently worried by the escalation of costs, issued an application for the proceedings to be re-allocated to the small claims track. It argued that, even on Mr Bolton's case, his counterclaim had a value of not more than £5,000. It seems that it was the dealers who opposed re-allocation to the small claims track. At all events the district judge directed that the proceedings should remain in the fast track and indeed that, in the event of failure to reach agreement, whether between the experts who had by then been consulted on behalf of Mr Bolton and of the two Part 20 defendants referable to the matters raised by the counterclaim or between Mr Bolton and the hire purchase company referable to the amount of the claim, the proceedings should be re-allocated to the multi-track.
In November 2000 Mr Bolton wrote to the effect that he refused to agree the amount of the claim against him and that he had instructed his expert not to consider material produced (as he said, late) by the expert for the Part 20 defendants. The result was that the proceedings were indeed re-allocated to the multi-track, down which they travelled to hearing and judgment on 7, 8 and 9 March 2001. Separate counsel appeared for the hire purchase company, the dealers and the distributors. Mr Bolton, by then without public funding, appeared in person.
By his substantive judgment dated 8 March, the judge, without difficulty, computed the value of the claim at £351. The difficulties for Mr Bolton in advancing a counterclaim about the nature or quality of a car purchased over four years earlier and after he had travelled over 100,000 miles in it were obvious. In fact when, outside court, the two experts were at last in a position to discuss matters, they agreed that in 1995 the car had...
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