South Lodge Flats Ltd v Vaqar Malik
| Jurisdiction | England & Wales |
| Judge | Lord Justice Lewison,Lady Justice Asplin,Lord Justice Peter Jackson |
| Judgment Date | 29 March 2022 |
| Neutral Citation | [2022] EWCA Civ 411 |
| Docket Number | Case No: CA-2021-000647 (formerly A3/2021/1067) |
| Year | 2022 |
| Court | Court of Appeal (Civil Division) |
[2022] EWCA Civ 411
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
Mr Justice Meade
CH-2020-000169
Royal Courts of Justice
Strand, London, WC2A 2LL
Lord Justice Lewison
Lord Justice Peter Jackson
and
Lady Justice Asplin
Case No: CA-2021-000647 (formerly A3/2021/1067)
and
Paul Letman (instructed by Spencer West LLP) for the Appellants
James Kinman (instructed by Stephenson Harwood LLP) for the Respondent
Hearing date: 23 March 2022
Approved Judgment
This judgment was handed down remotely by circulation to the parties' representatives by email and released to BAILII. The date and time for hand-down is deemed to be 10am on Tuesday 29 March 2022
Introduction and facts
The issue on this appeal is whether Meade J was wrong not to make an order that successful appellants ought to recover at least part of their costs of the appeal. Meade J made no order or costs. At the conclusion of the argument we announced that we would dismiss the appeal, with written reasons to follow. These are my reasons for joining in that decision.
The case is an unusual one in many respects. The litigation concerns a flat in Knightsbridge. Iftikhar Malik (“Iftikhar”) is the proprietor of a long lease of the flat. At the relevant time, his brother Vaqar and Vaqar's two adult sons occupied it. The litigation began when the landlord issued a claim against Iftikhar for the purpose of investigating a leak from the flat. But Iftikhar issued a Part 20 claim against Vaqar and his sons for possession and declarations about the beneficial entitlement to the lease. That Part 20 claim was defended on a number of grounds.
The possession claim was first listed for trial in the county court at Central London before HHJ Gerald in October 2019 but was adjourned to January 2020. At that time, after some nine days of trial which included the completion of Vaqar's oral evidence, the matter went part heard on 29 January 2020 with the trial listed to resume on 22 June 2020. On 29 April 2020 the county court sent out a notice of hearing for a PTR on 14 May 2020. By email dated 6 May 2020 to the court Vaqar and his sons referred to the upcoming PTR and adjourned trial date of 22 June 2020. They mentioned that they understood that proceedings for possession were subject to an automatic stay, stated that they were out of the jurisdiction and acting as litigants in person and that “The state of emergency and restrictions that have been imposed on us as a consequence of the Covid-19 pandemic do not provide any opportunity for dealing with this matter through Skype or by any other means, i.e. by personal attendance.” On that basis and because of the complexity of the case, the 20 lever arch files of paper and the need for lengthy cross examination, they requested that the court adjourn both the PTR and the trial “to a date to be fixed when it will be possible for all the litigants to be available in London for the resumption of the trial in person.” Iftikhar's solicitors responded by email on the same day. They said (among other things) that they understood the reference to a stay to be a reference to PD 51Z; pointed out that PD 51Z only applied to Part 55 claims and said that the claims in the action were not Part 55 claims.
HHJ Gerald considered that application on 14 May 2020. Although the hearing was conducted remotely, Vaqar and his sons did not attend. The judge was addressed briefly on the question whether the proceedings were the subject of the automatic stay imposed by Practice Direction PD 51Z entitled ‘Stay of Possession Proceedings and Extension of Time Limits — Coronavirus.’ He decided that they were not; and gave directions for the resumed trial on 22 June 2020. His directions made provision for the giving of evidence remotely. He also said that if the appellants wished to make a further application to adjourn they should file and issue a formal application with supporting evidence by 22 May 2020.
On 27 May 2020 (some five days late) the appellants did apply by email for a further adjournment. On 8 and 10 June 2020 Vaqar made two witness statements (called “Statements of Truth”) again seeking an adjournment of the part-heard trial. On 18 June 2020 the court sent out notice of a hearing on 19 June 2020 “to give the Part 20 Defendants an opportunity to be heard upon the contents of those Statements of Truth and whether same should be treated as informal application to adjourn.” The appellants did not attend that hearing either in person or remotely; and the court in substance refused the application to adjourn.
The part-heard trial resumed on 23 June 2020. Iftikhar was represented and was himself available to give evidence remotely from Pakistan. Vaqar and his sons were neither present (whether in person or remotely) nor represented. In their absence the Court acceded to Iftikhar's application under CPR 39.3(1) to strike out the Amended Defence and Counterclaim and entered judgment for possession and mesne profits etc all as set out in the detailed provisions of the order. The order was drawn on 1 July 2020.
On 14 July 2020 the appellants filed an Appellant's Notice seeking permission to appeal the orders of 23 June 2020, 19 June 2020 and 14 May 2020, on the basis that the Part 20 Claim, being a claim for possession of residential property within the scope of CPR Part 55, had since 27 March 2020 been subject to the stay imposed by Practice Direction PD 51Z. They also asked for an extension of time for appeal against the orders of 14 May and 19 June.
TFS Stores
In the meantime, an important legal development had taken place. On 2 July 2020 this court gave judgment in TFS Stores Ltd v The Designer Retails Outlet Centres (Mansfield) General Partner Ltd [2020] EWCA Civ 833, [2020] 4 WLR 99. By a majority, this court gave an expansive reading to the scope of PD 51Z. They held that, although PD 51Z stated that it applied to “proceedings for possession brought under CPR Part 55,” it in fact applied to any proceedings in which there was a claim or counterclaim for possession, whether or not that claim or counterclaim had been initiated under CPR Part 55; and to any proceedings in which an order for possession had been made even if there had been no formal claim for possession.
The appeal to the High Court
On 11 January 2021 Trower J directed that the applications for an extension of time for appeal, the application for permission to appeal and the appeal itself should be dealt with at a “rolled up” hearing.
By a Respondent's Notice dated 11 February 2021, Iftikhar sought to support the appealed decisions on a number of additional grounds.
Meade J heard the “rolled up” application on Friday 14 May 2021 and gave judgment on Monday 17 May. He began by dealing with the arguments raised in the Respondent's Notice in order to clear the decks. Those arguments were advanced (a) for the purpose of distinguishing TFS Stores as a matter of interpretation of PD 51Z and, alternatively (b) in support of the proposition that any stay had already been lifted by HHJ Gerald; or should now be lifted by the judge. In the course of his judgment, the judge rejected all those arguments.
There was some argument about whether the focus of the appeal was the order of 14 May 2020 (by which HHJ Gerald ruled that the claim should proceed to trial) or his ultimate order of 23 June 2020. Meade J decided that the best approach was to decide whether an extension of time for appealing the order of 14 May should be granted, and then to see where matters stood. That avoided the need to decide whether the order of 14 May 2020 had created a procedural estoppel which would itself have barred an appeal against the order of 23 June. There is no appeal to this court against that aspect of the judge's judgment. In order to decide whether or not to grant the appellants an extension of time for an appeal, Meade J went on to consider the now familiar three-stage test laid down by Denton v TH White Ltd [2014] EWCA Civ 906, [2014] 1 WLR 3926. A judge should address an application for relief from sanctions in three stages:
i) identify and assess the seriousness and significance of the failure to comply with any rule, practice direction or court order which engages rule 3.9 (1);
ii) consider whether there was a good reason for the default;
iii) evaluate all the circumstances of the case, so as to enable the court to deal justly with the application including the factors in sub-paragraphs i) and ii).
Meade J held that the default was serious; and that there was no good reason for it. Thus the appellants failed at the first two stages. At [64] the judge went on to consider the question what would have happened if an appeal had been presented in time. He thought that it was entirely possible that Iftikhar, “who in general seems to have taken a pragmatic” view of the proceedings, might have accepted that the automatic stay applied. He went on to say that the lateness of the notice of appeal meant that there had been no chance to consider the matter.
At the third stage it is not usually appropriate for the court to consider the merits of the underlying claim or defence, but it may do so where the merits (or otherwise) are clear: Global Torch Ltd v Apex Global Management Ltd [2014] UKSC 64, [2014] 1 WLR 4495. In R (Hysaj) v Secretary of State for the Home Department [2014] EWCA Civ 1633, [2015] 1 WLR 2472 at [46] Moore-Bick LJ put the point as follows:
“In most cases the merits of the appeal will have little to do with whether it is appropriate to grant an extension of time. Only...
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