Snook v London and West Riding Investments Ltd

JurisdictionEngland & Wales
CourtCourt of Appeal (Civil Division)
Judgment Date17 January 1967
Judgment citation (vLex)[1967] EWCA Civ J0117-1
Date17 January 1967

[1967] EWCA Civ J0117-1

In The Supreme Court of Judicature

Court of Appeal

Civil Division

(From His Honour Judge Andrew Marylebone County Court.)


The Master of the Rolls

(Lord Denning)

Lord Justice Diplock and

Lord Justice Russell

Alan Snoox
London & West Riding Investments Ltd.

MR P. HEARD (instructed by Messrs Bell, Bradrick & Gray, Agents for Messrs Miller & Co., Sheffield) appeared as Counsel for the Appellants.

MR S. GILL (instructed by Messrs Neal Scorah Siddens & Co., Sheffield) appeared as Counsel for the Respondent.


In September 1963 Mr Snook got from a dealer a bread new M. The cash price wee £955.19e,8d. He paid most of it cashdow,&735. 19s.8d., leaving only £200 outstanding. He arranged to pay off this £200 on hire-purchase terms. She dealer introduced him to a finance company called Totley Investments Ltd. (which I will call Totley). On the 16th September, 1963, Totley let him the car on these hire-purchase terms:-

Balance outstanding £200. 0s.0d.

Finance charge 15. 0s.0d.

Option fee 1. 0s.0d.

&216. 0s.0d.


payable by twelve monthly instalments of £17. 18s.4d., the first payable on the 16th October, 1963.


Mr Snook duly paid to Totley the first three instalments due in October, November and December, 1963, coming to £53. 15s.0d. leaving £16l. 5s.0d. outstanding. But then be wanted to raise some money on the car. He saw an advertisement by another finance company called Auto-Finance Ltd. which said: "Auto-Finance puts commonsence into credit. We can help you. Refinance: We pay off your existing hire-purchase debt and refinance this over a further period of twelve to thirty-six months. thus reducing monthly payments". Mr Snook went to Auto-Finance. He saw a Mr Hukins who in his presence telephoned Totley and asked for the "settlement figure" Totley said that they would accept £160 in settlement if paid within seven days. Mr Hukins ten told Mr Snook that they would pay out Totley and allow him a further £100.


In order to carry out this refinancing operation, Auto-Finance put before Mr Snook a number of documents for signature, Mr Snook signed them believing that they would produce the desired result. They turned out to be a sham. The Judge so found. They dressed up the "refinancing operation, to look like a now hire-purchase transactions whereas it was really a loan on the security of goods. The first document letteraddressed to Totley. It saids "I have sold my rights in the above vehicle to Auto-Finance Ltd., subject only to your lien which they will discharge. Will you please inform Auto-Finance bow much you require to settle my obligations to you and to pass title absolutely to them in the vehicle. On the bottom half there was a reply ready for Totley to sign. It was addressed to Auto-Finance and said: "We are prepared to sell title in the above vehicle to you absolutely for the sum of &………,this amount to be received within 7/14/21 days of this date". Mr Snook signed the top half, end left the paper with Auto-Finance. But it does not appear that they ever forwarded it to Totley. They seem to have kept it in their office. The bottom half was never signed by Totley. The blank figure was never filled in. Most important of all, the statement in the top half: "I have sold my rights to Auto-Fiance", was not true. The Judge found it was not true. Mr Snook had not sold his rights to them. They were worth £700 or £800 and they did not pay him a penny for them. He was in sole possession of the vehicle and had never parted with it to anyone.


It is equally important to note that Totley never sold their interest to Auto-Finance. Nevertheless then forward, in spite of having no title, Auto-Finance treated themselves as if they were owners of the car. They acted as if they were declare disposing of it on hire-purchase terms to Mr Snook. They put before Mr Snook a second document, which was a hire-purchase form. It was not with Auto-Finance but with another finance company called London and West Ridding Investments Ltd. It appears to be a company for whom Auto-Finance act as agents. They stock its forms and get them filled in. On this form Auto-Finance filled it in as a hire-purchase transaction for the M. G. car. They invented the figure. The cash price was filled in as £800 when it was not the price. The initial payment was put as £500 when nothing had been paid. The finance charge was put at £54. Option fee £1. The balance payablewas put at £355, payable by Mr Snook over two years by monthly instalments of £14. 15s.0d. On the same form there was also a printed delivery receipt. Mr Snook signed it, as he did the others. By it he acknowledged that he had accepted delivery of the car and he understood it was the property of the West Ridding Company.


When Auto-Finance had got Mr Snook to sign these documents, they themselves signed another form by which they invoiced the car to London & West Ridding Investments Ltd. They Filled in the same fictitious figure, the cash price £800, initial payment of £300. In this form they warranted that the car was their absolute property. That was not true. It was not their property. They had not bought it, nor paid a penny for it.


Auto-Finance than sent all these documents to the defendants, London & West Ridding Co. That Company knew that Auto-Finance dealt in these refinancing transactions. They had had many previous deals with Auto-Finance. But there was no evidence that they knew of any of the irregularities in the conduct of the deal. On receiving the documents, the West Ridding Co. paid £300 to Auto-Finance. Auto-Finance paid £160 to Totley, who accepted it in full discharge and acknowledged that they had no further interest in the vehicle. Auto-Finance paid £125 to Mr Snook and kept £15 for themselves for their services.


Mr Snook paid the West Ridding Co. the instalments of £14. 15s.0d. due on the 27th February and the 27th March,1964, but then he was out of work and fell into arrear for the two months of April and May 1964. On the 6th June,1964, whilst Mr Snook had parked the car for a little while, some men raised the car and took it off. They were men from Auto-Finance acting as agents for the West Ridding Co. When Mr Snook discovered that they had taken it, he went to Auto-Finance acting as agents for the West Ridding Co. When Mr Snook discovered that they had taken it, he went to Auto-Finance and offered topay off the arrives. He took the money down to them, but they refused to accept it. They paid off the West Riding Co.£280(which satisfied them)and kept the balance of £255 for themselves. It was, they said, their "profit" in the transction.


Mr Snook now sues the defendants, West Ridding Co., for damages for conversion of the car. The West Ridding Co. in their defence claim that it is their it is their car. They say that, after the "settlement figure" was paid, Auto-Finance became the owners: and that Auto-Finance sold it to West Ridding: and West Ridding: and West Ridding let it on hire-purchase to Mr Snook: and that he failed to pay the instalments: whereupon" the defendants the car and sold the same".


In considering this case there are two cardinal facts to be remembered: first, that Mr Snook was at all times in possession of the car and entitled to it as against all the world save he who could prove a better titled; second, that the defendants, by their agents, Auto-Finance Ltd., took possession of the car and sold it and took the proceeds. Those two facts are sufficient to give Mr Snook a prime facie case for damage for conversion. It is for the defendants to show that they were entitled to retake it, as they did.


The Judge decided in favour of Mr Snook on three grounds, which I will take in the same order as he did.


First. the defendants did not prove a title to the car.


The defandants claim that they bought the car from Auto-Finance. Immediately prior to the refinancing operation, there were two persons entitled to an interest in the car: Totley, who were the owners and had let it out to Mr Snook on hire-purchase; and Mr Snook, who had the right to require the title by paying the "settlement figure" of £161, was the recent case ofWickhem Holdings an Brook House, not yet reported, of the 8th November,1966, seeing that the car was worth some £900, Mr Snook's contractual right(or "equity", as it is sometimes called was worth about £740).


In the course of the refinancing operation, Auto-Finance paid to Totley the "settlement figure" of £161:but that did not give Auto-Finance the title to the car. The only person who had the right to pay that "settlement figure" was Mr Snook. Auto-Finance must be presumed to have paid it on be half of Mr Snook. With the result that Mr Snook became the owner of the car, see the recent case of Pennett v. Griffin Finance, not yet reported. Auto-Finance never bougth the car from Mr Snook, nor his interest in it They never paid him a penny for his contractual right. They did not become the owners of the car. The title was in Mr Snook.


Seeing that Auto-Finance were not owners, they had nothing to transfer to the defendants. So the defendants did not become the owners. It was suggested in the course of the arguments before us that they acquired a titled by estoppel similar to that which the finance company acquired in Eastern Distributors Ltd. v. Goldring, 1957.2 Queen's Bench, page 600,and Stoneleigh Finance v. Phillips. 1965,2 Queen's Bench, page 537. I do not think this point is open to the defendants. Estoppel was not pleaded, nor was it raised in the County Court, nor found by the Judge. It is not even mentioned in the notice of appeal. Even if it were open, no evidence was given by the defendants to support an estoppel. They do not say that they relied on any representation by Mr Snook or on his conduct or on his signing...

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