Denekamp v Denekamp

Mr John Charles Denekamp seeks permission to appeal three orders made in the High Court of Justice, Chancery Division. The first is the order of Mr Peter Leaver Q.C. sitting as a deputy judge of the High Court made on 30^th September 2004 by which the judge struck out proceedings brought by Mr Denekamp against three defendants, his mother, his brother, Johan, and a family solicitor Mr Vaughan. The second application relates to the order made by Mr Leaver on 23^rd November 2004 when he made an extended civil restraint order against the applicant for a period of two years. The third application concerns the order made by Mr Justice Hart on 7^th December 2004 dismissing the applicant’s application that the defendant’s legal teams be held in contempt of court, ordering also that the applicant pay the respondent’s costs on an indemnity basis.

Mr Denekamp appears in person assisted by his McKenzie friend Mr Plow. They have placed a voluminous amount of paper before the court. There are three large plastic cartons of ring binder files. Prolix they may be but they are beautifully presented and I am grateful to Mr Denekamp and Mr Plow for the obvious trouble they have taken. I have heard Mr Denekamp on two occasions for several hours, much, much longer than is ordinarily afforded for an application for permission to appeal. Because the litigation so obviously consumes his attention, I have given the greatest care to his case. Although he has left no stone unturned, I cannot on an application for permission to appeal comment on each and every argument advanced to me, orally and in writing, though I have borne all those submissions in mind.

Mr Denekamp issued two claims which have a considerable overlap with each other. The gist can best be expressed by reciting the “brief details of claim” set out in the second claim form:-

“Following my father’s death on 8^th January 1989, inter alia to illegally evade the inheritance tax that should have been paid by my two siblings, I was duped by the second and third defendants [his brother and solicitor] and my now deceased sister, to sign a deed of variation (DOV) dated 13^th March 1989, varying the laws of intestacy in favour of the first defendant (my mother). After being appointed as an administrator of my father’s estate, I was immediately sidelined and financially disadvantaged at every turn (mostly fraudulently), by the conspiracy of the second and third defendants. Whilst the third defendant was also negligent in not informing me of the “hotchpot” intestacy laws applicable in 1989 and their important significance before I signed the DOV. Therefore, I now claim that the DOV is annulled. And with regard to Clause 2 of the DOV, I can supply conclusive evidence that the properties Trenewth and Silver Birches should be considered as tenancies in common and proportionately part of my father’s estate. There are no claims made against the first defendant, as it is anticipated that she should suffer no financial loss with the DOV being annulled, as all claims flowing from the annulment are made against the second and third defendant.”

Under the deed of variation the family agreed that Mrs Denekamp should inherit the whole of her late husband’s estate, he having died intestate. The agreement also provided that whether or not the two properties or either of them were owned by the deceased and his wife as beneficial tenants in common, nonetheless they should be treated as the widow’s absolutely. This deed of family arrangement was made on the advice of the family solicitor Mr Vaughan.

The defendants moved to strike out those claims. The Master directed that the matters be heard together before a judge and gave permission to serve amended particulars of claim. That amendment was drafted by counsel, Mr David Spens and he appeared at the hearing before the judge at least on the first day of that hearing. The deputy judge said this:-

“It was common ground at the hearing before me that I should consider Mabel, Johan and Mr Vaughan’s applications to strike out particulars of claim or for summary judgment by reference only to the proposed amended particulars of claim … It was also common ground that I should treat the proposed amended particulars of claim as a final version, and should not, in the event that I came to the conclusion that some, or all, of the proposed amendments should not be permitted, allow further time for the claim to be re-pleaded.”

Nonetheless when Mr Denekamp appeared before me he was insistent that I should uphold the original pleadings only. He made it plain he was abandoning the draft amendment. In order to give him every possible latitude I was indulgent of that request notwithstanding the withdrawal from the common ground before the judge. The pleadings upon which Mr Denekamp now relies make 15 claims. Claim 1 in the most important. It alleges:-

“The third defendant’s negligence in failing to adduce section 47(1)(iii) of the Administration of Estates Act 1925 (i.e. the “hotchpot” rules) in his schedules A-G and failing to inform the claimant of this Act by other means. And the third defendant’s further negligence in failing to explain to the claimant any of the intestacy laws and beneficial and tenancy in common rules, to the extent that the claimant was thereby hamstrung in these matters.”

He alleges that the solicitor was negligent at the family meeting held on 11^th February 1989. He asserts that if he had been properly advised he would not have signed the deed of variation. He alleges that the negligence “has been compounded since by the third defendant’s lies, cheating, false accounting, attempting to use the claimant as an unwitting vehicle to facilitate his siblings inheritance tax fraud, other fraud …” He says that but for Mr Vaughan’s negligence he would not have entered into the DOV and so he asks for the deed of variation to be annulled and for aggravated damages.

It will be seen at once that the cause of action upon which he relies arose in February 1989. If a six year period of limitation applies, the claim is hopelessly out of time. Mr Denekamp meets that point by submitting that he did not appreciate that he had a cause of action until some time in 2003. He received copies of Mr Vaughan’s file in January 1998, except for documents which were withheld as containing advice given to Mrs Denekamp personally. He sought advice from another solicitor Mr Hill. It did not occur to Mr Hill to advise about section 47 of the Administration of Justice Act because that had been repealed in 1995. Mr Denekamp, rigorously pursuing his claim, consulted a friend Mrs Ward, a J.P., with some legal knowledge and at some time, it is not entirely clear when, she let him have sight of certain of the law books on the administration of estates. It was there that he read about section 47. He went to Mr Hill in 2003 and Mr Hill immediately recalled the hotchpot rules, a phrase then unknown to Mr Denekamp. In this sad case, that ignorance was bliss. So Mr Denekamp argues that he was only able to bring the claim in 2003. He argues that the starting date for the running of time is the earliest date on which the plaintiff first had both the knowledge required to bring an action for damages in respect of the relevant damage and a right to bring such action. Knowledge for this purpose is defined by section 14A(6) of the Limitation Act 1980 to mean knowledge both (a) of the material facts about the damage in respect of which damages are claimed and (b) of all other facts relevant to the current cause of action mentioned in subsection 8. Those are the facts that the damage was attributable to the negligence (causation) and the identity of the defendant. Mr Denekamp relies on subsection (10) that a person’s knowledge includes knowledge which he might reasonably have been expected to acquire from facts ascertainable by him with the help of such appropriate expert advice which it is reasonable for him to seek and so he argues that if his solicitor Mr Hill did not appreciate the application of the hotchpot rules, then knowledge should not be attributed to him until the penny had finally dropped.

In my judgment subsection (9) is also of importance. That provides that:-

“Knowledge that any acts or omissions did or did not as a matter of law involve negligence is irrelevant for the purposes of subsection 5 above.”

What facts were relevant for Mr Denekamp’s cause of action? He knew because he signed the relevant forms for submission to the Inland Revenue that advances had been made to his brother and sister. What he did not know was that those amounts could be brought back into account. He was ignorant of the law. That is his misfortune. He says, of course, that it was negligent of the solicitor not to have advised him of the law. Ignorance of the law is no excuse. When the question is when time begins to run, the matter seems to me to be covered by the judgment of Jonathan Parker J. in HF Pension Trustees Ltd. v Ellison & Others [1999] Lloyds L.R. (P.N.) 489 at 495:-

“What the plaintiff’s argument boils down to is that although it knew all the material facts it did not know until later that those facts gave rise to a claim in negligence. In my judgment, however, in cases under section 14A as in personal injury cases, their ignorance that the known facts may give rise to a claim in law cannot postpone the running of time under the 1980 Act. As I read the sections and the authorities, both section 14 and section 14A are concerned exclusively with matters of fact provable by evidence, as opposed to matters of English law, in respect of which evidence is inadmissible.”

In Fennon v Anthony Hodari & Co [2001] Lloyds Rep PN 183 Otton LY said succinctly:-

“In order to mount the action she did not need to be advised that the failure to advise amounted to professional negligence. This is irrelevant for the purposes of subsection (5) and the start date for reckoning the limitation period.”

In Hawardv Fawcetts [2004] PNLR 34 Jonathan Parker L.J. repeated:-

“ “It is clear from the words of the section itself … that it is concerned with knowledge of facts, as opposed to knowledge of matters of law. In particular, subsection (9) specifically excludes knowledge that the defendant acted negligently.””

Mr Denekamp also relies on section 32 of the Limitation Act 1980 contending that facts relevant to his right of action had been deliberately concealed from him by the defendant. This submission fails for the same reason. The facts relevant to his right of action were the fact that money had been advanced by the deceased to his children. Those facts were not concealed. They were known to Mr Denekamp. They were also known to Mr Vaughan. As Cave v Robinson Jarvis and Rolf [2003] 1 AC 384 establishes there is nothing for Mr Vaughan to disclose if he was unaware of his error or unaware that he had failed to take proper care. Mr Denekamp points out that in his defence confirmed by a statement of truth Mr Vaughan pleads in paragraphs 19 and 20 that the hotchpot rules applied and that he so informed the family in February 1989. If that is so he was not negligent but my task is to look at the way the claimant pleads his case. Mr Denekamp’s case is that Mr Vaughan knew he had been negligent and deliberately concealed the fact that he had been negligent. Whether or not he had been guilty of negligence is a conclusion of law not a matter of fact. Section 32 applies only where “any fact relevant to the plaintiff’s cause of action has been deliberately concealed”. As I have pointed out, the mistake as to a matter of law is not a mistake of fact relevant to the right of action. So the argument based on section 32 also fails. After reading a draft copy of this judgment Mr Denekamp writes inviting me “to confirm unequivocally does section 32(5) of the Limitation Act 1980 include or exclude the Claimant’s so called: “ignorance of the law” in section 32(1)(b).” Although I made it plain at the beginning of this judgment that I did not intend to deal with each and every argument advanced to me by Mr Denekamp, I will endeavour shortly to express my view on this issue. Section 32(5) is intended to ensure the time begins to run from the date on which the course of action accrued as set out in section 2 of the Act. That is the reason for disapplying section 14A. It does not alter my conclusion that the only facts relevant to the plaintiff’s right of action were the facts relating to the advances having been made. Negligence as such is not a fact: I repeat, it is a conclusion of law. To make it plain, Mr Denekamp knew all he needed to know to bring his claim. He is statute barred.

There is another difficulty about this argument. In paragraph 9 of his skeleton argument modified on 14^th September 2005, Mr Denekamp alleges that from “circa 1997 Mr Vaughan deliberately concealed his negligence in failing to inform the claimant (and it appears also negligently failing to inform his mother and siblings) of the hotchpot rules”. If that is when the concealment began, the cause of action had already expired by then namely by February 1995.

It follows that this claim is statute barred and must be struck out.

If, therefore, Mr Denekamp cannot successfully annul the deed of arrangement, then it stands and the estate has to be administered in accordance with its terms. Setting the DOV aside is fundamental to Mr Denekamp’s case. If it remains in force, as in my judgment it must, then much if not all of the remainder of his case falls away as he probably knows. So I can take the remaining claims quite shortly.

Claim 2 alleges deceit in that Mr Vaughan failed to claim a tax rebate for the estate. Assuming all else in Mr Denekamp’s favour, the loss is suffered by the estate not by Mr Denekamp and he has no cause of action in respect of it.

Claim 3 was abandoned.

Claim 4: this alleges negligence in making an interest payment to the Inland Revenue at the behest of the accountants. If this was an error of the accountants, it is the estate which has suffered the loss not the claimant. No duty was owed to him personally and he has no cause of action in respect of it.

Claim 5 suffers the same fate. The claimant claims that the third defendant negligently paid £293.75 from the estate when it is alleged it should have been made by the shareholders of the company. I repeat the claimant has no cause of action in his own name for recovery of money due to the estate. It is the estate which must bring the claim.

Claim 6 is abandoned.

If anyone is entitled to the return of the documents referred to in claim 7 it is the estate. In any event if they are to be produced, they are to be produced in the course of discovery in the action and that is a procedural matter not the substance of a specific claim.

Claims 8, 9, 10, 11 and 12 are abandoned, so is claim 14.

As for claim 13 this alleges the second defendant’s negligence in failing to ensure that the liquidators of the family company were aware of irregularities in the conveyance of the property. If anyone is owed a duty if care and suffered loss, it is the company or the estate. It is not Mr Denekamp personally.

Claim 15 in the second statement of claim alleges the brother’s deliberate neglect of his duty of care to the company shareholders in accepting a low valuation. Once again no duty was owed to nor loss suffered by Mr Denekamp personally.

The sad fact is that all these claims are utterly hopeless and devoid of merit. It is quite impossible to plead to the allegations in the claim which are couched in terms which merit being struck out for being embarrassing, frivolous and vexatious. I do not need to examine in detail the extent to which they are also an abuse of process in view of the fact that these claims could have been made and therefore should have been made in the earlier 1999 claim had been struck out already. Full opportunity was given to amend to put the pleadings in good order. The opportunity was not taken: indeed before me Mr Denekamp reverted to the claims he drafted himself and he has lost all entitlement to further indulgence from the court.

Sadly, in my judgment, Mr Denekamp has become obsessed with this litigation and the judge was right to bring it to an end. In view of the fact that Mr Denekamp abandoned the pleading which the judge struck out I need not consider in detail whether there would be good ground for successfully appealing against his judgment. In my preparation for the case I have to state emphatically that I could find no error in the judge’s approach and would have upheld his judgment in any event.

In the result the application for permission to appeal against Mr Peter Leaver’s order of 30^th September is dismissed.

This order was made in the exercise of a judicial discretion. In order successfully to appeal it Mr Denekamp would need to show that it was plainly wrong, that is to say that it fell outside the generous ambit within which reasonable disagreement is possible. By no stretch of the imagination can it be said that the deputy judge was palpably wrong in that sense. He was right to conclude in paragraph 4 of his judgment:-

“What is clear to me is that if anyone dies not agree with Mr Denekamp, that person is subjected to abuse and threats of litigation; threats which for these defendants have become a reality in the last few years. Now that the litigation extends not just to the family and Mr Vaughan but also to the legal advisers of the defendants, because Mr Denekamp has issued an application “to punish them”, as he puts it, for contempt of court, and tendering false evidence. That application is returnable before the court on 7^th December.”

I am in no doubt at all that these defendants are after all these years of fruitless litigation entitled to some peace of mind and some halt to the ceaseless pursuit by Mr Denekamp of his misconceived complaints against them. Far from the judge being wrong he was in my judgment obviously right. The way he floods me with paper confirms the view that the deluge must stop. This is an utterly hopeless application which must be dismissed.

The thrust of this complaint is that Gabb & Co., Mr Vaughan’s firm, failed to produce a copy of the complete file relating to the estate, namely the contents of the white envelope. Now solicitors representing Johan and his late sister and solicitors and counsel representing Mr Vaughan are dragged into the litigation to defend a “ declaration of contempt” sought against them. Hart J. found that the application had no merit whatsoever:-

“The position that there has been any contempt is quite simply unmaintainable and unarguable.”

I agree. The application was another form of harassment. As the judge held Mr Denekamp had no permission to bring the application. Moreover, Mr Denekamp did not appear before the court to pursue his application. The judge was entitled for that reason alone to strike it out. No attempt has been made by way of application to Hart J. to discharge his order as one which was made in the absence of the party concerned. That would have been the right approach and moving the Court of Appeal is the wrong procedure in any event.

This is, however, another example of how misguided Mr Denekamp has become in all aspects of this litigation. It serves to confirm the correctness of the orders made below. It serves to confirm how hopeless these present applications are. I dismiss them accordingly.