Choudary v Nawaz & Ors

On 23^rd November 2006 His Honour Judge Mayor QC gave judgment on a preliminary issue which had taken some four days to try. The issue was whether the claimant had ever become a partner with the first to fourth defendants in a firm named Northern Accommodation Agency and, if so, in what share. The judge ruled that the claimant had failed to establish membership of the partnership. In so ruling the judge formed an unfavourable view of all the parties concerned and indeed made certain very adverse findings as to the credibility of the claimant, including a finding that he had forged a document or documents. Application for permission to appeal should have been made to the judge and, if refused, within 21 days of the judgment to the Court of Appeal. Only on or about 16 April 2007 did the claimant file an Appellant’s Notice. As he was bound to do, the claimant sought an extension of time for appealing. The first ground of appeal sought a retrial “because there is new evidence available to the claimant (which was not before the learned judge) and which would have an important influence upon the result of the trial.” Thus, at the same time as applying for an extension of time, the appellant was seeking to file fresh evidence. Part of the fresh evidence he wished to file was a handwriting expert’s report but that report was, at the moment of drafting the grounds of appeal, unavailable.

Sir Henry Brooke considered the matter on paper and adjourned the applications to a full court with appeal to follow, if an extension of time and permission to appeal were granted, by which time he directed the handwriting expert’s report “must be disclosed and filed”.

The matter came before us on 5^th December 2007. The handwriting expert’s report was available, but only just, it having been disclosed to those representing the claimant only on 29^th November 2007. We had detailed skeleton arguments. We also heard argument over a full day, that argument being addressed in the main to the question whether the evidence was truly fresh evidence and what its impact would in any event have been on the merits if any appeal were to take place. Only if an appeal had a real prospect of success could the court even consider extending time of the length required in this instance.

This is described by the judge in some detail from paragraphs 1 – 5 of his judgment, demonstrating a state of affairs giving cause for serious concern. I will use some of his words just to give a flavour:-

“1.

For the past four days the court has been concerned with a partnership dispute between a group of businessmen. The business in which they have been engaged which gives rise to the dispute between them is the business of providing accommodation, food and pocket money for refugees and asylum-seekers. Let it not be thought that that statement of so charitable a purpose explains the character of the business in which these gentlemen themselves have been engaged for, by a remarkably lax and uncontrolled system, at least during the years with which this litigation is concerned (principally the years 1999 and 2000, but perhaps still today – I know not), huge sums of public money are expended through outlets over which there is little control.

2.

The system, if that is not too generous a word to employ, is that a group of individuals (such as the parties in this case) identify, by means that has not been explored or explained, numbers of asylum-seekers (I will use that single term rather than refugees and asylum-seekers from here on) who are desirous of obtaining accommodation and food and pocket money, and those individuals, as a sort of gang-master, approach a local authority and are permitted by the local authority to act as brokers, to take very substantial funds from the local authority. They then use those funds to house and provide board for the asylum-seekers in properties which they, the individuals, have rented and in which they provide the accommodation of so many to a house and the food such as it may be and the pocket money or so much of it as the asylum-seekers in truth receive. And they make charges themselves to the asylum-seekers of which, so far as the evidence in this case is concerned, there is no proper documentary record whatever. Indeed, the majority of asylum-seekers referred to here are people who could not speak English, let alone write it or check what was being written. Then, in turn – and this may be one of the reasons for the slackness of the system, the local authorities recover the funds thus expended by them from the central government.

3.

The amounts of money involved are huge by any standards. . . .”

It was the claimant’s case that he had partaken in this so-called trade on his own, under the name Yorkshire Property Investment and Management. His case was that he then entered into a partnership with the third and fourth defendants (to whom I shall refer hereafter as Ilyas and Younis) in April 1999 (although in evidence this may have become July 1999). That partnership, according to the claimant, traded under the name West Yorkshire Properties, although his evidence was that it in fact it also traded as “T.B. Younis”, a fact, according to the claimant, he did not discover until later. The dispute as to the existence of this tripartite partnership was the sub-plot to the actual issue which the judge had to try, relating to a partnership said to have been formed later.

The claimant’s case was that at a meeting at the Spinney Hill public house at the end of October 1999 between the first defendant (Nawaz) and the second defendant (Riaz) and himself there was a discussion about the claimant and the first four defendants going into partnership together under the name Northern Accommodation Agency. His case was that he left that meeting saying he agreed the proposals to go into partnership but that he would have to consult with his then suggested partners, Ilyas and Younis. His case was that he obtained the agreement of Ilyas and Younis to the new partnership. Then, according to the claimant, at a further meeting at the Cock public house in Northampton, between the claimant, Nawaz and Riaz, the claimant reported the agreement of Ilyas and Younis. He said that an agreement was made on that day to form a partnership, Northern Accommodation Agency. Some time later at a further meeting between the claimant Nawaz, Riaz, Ilyas and Younis, the share in the partnership was agreed (he said) at 20% each.

Even on his case that partnership only lasted a very short time. His case was that at a meeting in January 2000 Nawaz, in the presence of the other defendants, terminated the partnership and excluded him. They replaced him with the fifth defendant. Thereafter on the claimant’s case there was what the judge described as a twilight period during which the claimant and Riaz, Ilyas and Younis continued to do business.

It would seem that at the trial there was no issue that a meeting took place at the Spinney public house and that there was discussion of a partnership. All the defendants however denied that the claimant was present at any meeting at the Cock. Ilyas and Younis denied there ever was the tripartite subplot partnership, either formed in April or in July 1999. It was accepted that a partnership trading under the name Northern Accommodation Agency was at some stage formed. In December 1999 Riaz and Nawaz evidently signed a bank mandate opening a bank account (as I understand it) in the name of the new partnership. There was then, again it was common ground, a meeting in January 2000. At that meeting any relationship which the claimant had involving Nawaz was brought to an end.

In March 2000 a further bank mandate was signed by all defendants in the name of the partnership, Northern Accommodation Agency. Furthermore a written partnership agreement was entered into between all the defendants. That partnership agreement provided for the partnership commencing as at 1 December 1999 and provided for termination on six months’ notice (see trial bundle 3 page 412).

There was, it seems, a dispute between Nawaz and his co-defendants as to whether Nawaz ever was a partner, resolved only after Nawaz commenced proceedings.

When the claimant made his claim against the defendants to the effect that he was a partner, as he ultimately did by letter dated 6 May 2004, (see page 185 in trial bundle 1), he may have been under some misapprehension as to the effect of partnership law. If he could establish some form of partnership, it was certainly not, so far as he was concerned, of any defined length. It was not as the written agreement ultimately provided for, terminable on only six months’ notice. It was thus a partnership at will. Such a partnership is terminable simply on notice being given (see s.32 of the Partnership act 1890). His claim letter seems to contemplate a claim for profits from December 1999 up to the date of the letter. The reality is, however, that any claim for profits, if he could establish a partnership, would be for profits over the very short period December 1999 to January 2000.

Furthermore, on the evidence before the judge and leaving on one side for the moment the finding that the judge did make as to the fabrication of documents, the claimant’s case to establish some partnership was a very difficult one. Firstly, there was no written agreement evidencing any partnership either between the claimant and Ilyas and Younis (the sub-plot) or between the claimant and the first four defendants (the issue before the judge). Secondly, there were no accounts or books of any partnership for the relevant period from which some evidence of the sharing of profits or losses could be inferred or from which the relationship of partners could be itself inferred.

In addition, there were some inconsistencies which the claimant had to explain; for example it seems that he commenced an action against Leeds Council in his own name, seeking to claim from them sums on the basis that there had been, during 1999, asylum seekers lodging in properties of which the claimant was the tenant. If his claim to be in partnership with Ilyas and Younis was accurate, that claim should have been brought in the firm name or at the very least for the benefit of all three partners. The pleadings and letters from solicitors, as is pointed out in the judge’s judgment, were inconsistent with that position. What is more, Leeds Council produced evidence that there were in fact no asylum seekers in the houses. It seems that Ilyas and Younis ultimately supported the Leeds’ case. In the result the claim had to be dropped and this is dealt with at paragraph 4 of the judge’s judgment in the following words:-

“In Leeds – and I shall refer to this again in due course – when the claimant himself was bold enough to put in substantial claims for these payments in respect of alleged asylum-seekers, housed allegedly in properties that he had taken leases of in Leeds, he was said by the County Council not to have housed any such asylum-seekers at all in those properties. The claimant disputed and continues to dispute that, in the face of cogent evidence – and I have only seen a small part of it; a witness statement by someone in the social services department for Leeds City Council recording her own observations and those of her colleagues who had been to the properties where there were supposed to be all these asylum-seekers packed like sardines in a tin, and not a sign of one of them. And although there is abundant evidence in this case, as one knows there is from reading newspapers and the like, inevitable complaints from neighbours of properties which are used for housing asylum-seekers, at least the neighbours to these properties in the back streets of Leeds had been blissfully unaware that any asylum-seekers were sharing their district of the City. And so, the Leeds City Council refused to pay. On the necessarily limited evidence which I have heard – and I am not trying that case – I have formed the view that the truth lay with the Leeds City Council and not with this claimant. I shall be reviewing his worth as a man of truth and a witness in due course in this judgment. Nevertheless, boldly, he actually set out to sue the Leeds City Council in the Leeds County Court to recover the money which they were refusing to pay to him and he prosecuted the action as far as beginning to give evidence at the trial itself. It was only when two of the defendants in this case, partners with him (although the action he had brought was in his own name and not in that of any partnership or together with any other persons) learnt of what was going on and made statements supporting the Leeds City Council’s case, that finally this bold action was withdrawn. It is some relief at least to see that there is some limit to the audacity, indeed the brazenness, of this claimant.”

When the claimant sought to show that Younis was carrying on West Yorkshire business from the offices which he said were Northern Accommodation Offices, what he relied on was a letter dated 23 November 1999 headed West Yorkshire Properties. This is a letter which the judge held to be a forgery, and I will return to it, but even if not a forgery it hardly supported the claimant’s case of a partnership operating from October/ November 1999 in the name of Northern Accommodation.

The nub of the claimant’s case was that 17 properties had been brought into the business by him. He identified those in his statement which stood as his evidence in chief. His case was that these properties were brought into the sub-plot partnership and then became part of the assets of Northern Accommodation. To establish the fact that the properties were part of the sub-plot partnership, the claimant sought to rely on documents which seemed to implicate Younis in the business. The judge however found that the fact that Younis could be shown to have had something to do with these properties, or some of them, was properly explained in Younis’ witness statement where he said:-

“I was aware that Mr Choudary (the claimant) had properties which were used for rental. If they were vacant he may make them available to me if I had clients and I used some properties which he had sublet from other landlords. In this way money did pass between us but this was not a business as such as it only occurred occasionally as a matter of convenience.”

That led the judge to make the following finding:-

“I am entirely satisfied – and this may be important when I turn to the next chief topic in this judgment – that the explanation for that given in paragraph 2 of his witness statement and in oral evidence by the fourth defendant is the only one which fits satisfactorily with the other oral and, more significantly, documentary evidence in this case. That is to say, that those properties had been leased by the claimant but that the claimant at the material time could not fill them with what were perhaps somewhat euphemistically called “tenants” (that is to say, asylum-seekers), so the fourth defendant used the properties himself and paid the claimant in cash. That, it seems to me, is the only credible explanation for what was happening and, of course, it makes sense. Having rented a property in the hope that the claimant could fill it with asylum-seekers, and being unable to do so, the property becomes, rather than a source of profit, a liability; the landlord will be looking for the rent. Therefore, what more obvious and sensible resort than to allow another person engaged in the same asylum-seeker business to use them so that at least the rent could be paid without loss to the claimant himself? I accept that evidence from the fourth defendant, and it follows that I reject the contention upon which he laid such reliance by the claimant that the evidence to connect those properties with certain of the other defendants is of assistance to him in proving his claim.”

Without regard to the judge’s finding of forgery, as far as I can see, the evidence before the judge did not support any final agreement or formation of a partnership of which the claimant was a member. In so far as there were seventeen properties in which it could be said Younis was implicated, that did not support the existence of any partnership, even with Younis, never mind a partnership involving the other defendants. Such evidence as was before the judge supported discussions about the formation of a partnership but not any agreement that there was one. There was simply no evidence from which he could conclude that there was a sharing of profits or losses during the very short period December to January 2000. His findings in paragraph 27 were as follows and hardly depend on the finding that he had made as to fabrication of documents:-

“It seems to me, therefore, that the conclusions the court must reach are inevitable. First, the claimant never was a party to any agreement with any persons with regard to the setting up of or his participation in Northern Accommodation Agency. The furthest that the matter ever went was that he was one of a number of potential participants by taking partnerships in that partnership and he never in fact took it up. It is plain that the partnership began, as is reasonable and sensible, in a hesitant way; first, with the two initial partners committing themselves, as one can see on the earlier of the two bank mandates I have referred to, and then the remaining partners coming in subsequently as they decided to enter. The claimant simply was not one of those. That is fatal to his claim and disposes of it. But equally this, for completeness sake if no other, that no agreement averred by the claimant is capable of falling within the legal definition of a partnership to which I have already referred: neither in point of fact nor of law do the agreements which he says he made amount to such arrangements as would consist of a partnership in English law. Accordingly, this claim fails and there will be judgment for the defendants against this claimant.”

Thus, on the evidence before the judge and on the judge’s findings at the trial, this would not be an appeal which had any real prospect of success.

I remind myself of the proper approach to the admission of fresh evidence on an appeal. The position is now governed by CPR 52.11(2). This was explained by Hale LJ (as she then was) in Hertfordshire Investments Ltd v Bubb [2000] 1 WLR 2318 where she said this:-

“The court will not consider evidence which was not before the court below unless it has given permission for it to be used. It is no longer necessary to show ‘special grounds’. The discretion must also be exercised in accordance with the overriding objective of doing justice. However, in Banks v Cox (17 July 2000, unreported); Court of Appeal (Civil Division) Transcript No 1476 of 2000, Morritt LJ said:

‘In my view the principles reflected in the rules in Ladd v Marshall [1954] 1 WLR 1489 remain relevant to any application for permission to rely on further evidence, not as rules but as matters which must necessarily be considered in an exercise of the discretion whether or not to permit an appellant to rely on evidence not before the court below’.”

The rules in Ladd v Marshall to which she refers are well known and in summary are (1) that the evidence could not have been obtained with reasonable diligence for use at the trial, (2) if given it would probably have had an important influence on the result of the case; and (3) it is apparently credible, although not incontrovertible.

Thus it is relevant whether the documents now sought to be put in before the Court of Appeal were actually available at the trial and if not whether they could with reasonable diligence have been available. It is also relevant whether if they had been available they would have had an important influence on the result of the trial.

Mr Dingemans QC who argued the application for the claimant submitted that if the documentary evidence that he wished to place before us plus the report of the handwriting expert were admitted the evidence of the claimant and the evidence of the defendants would be viewed in a new light. The documents would support the view that the claimant had not forged any document and would support a case that the defendants had lied at the trial.

The first ground of appeal is worth quoting since it identifies the documents with which the application is concerned and the basis on which it is suggested that they would have had an impact on the trial.

“Ground 1

1.

There ought to be a retrial of the action because there is new evidence available to the Claimant (which was not before the Learned Judge) and which would have had an important influence upon the result of the trial. The evidence is:

a.

A letter from Wakefield Metropolitan District Council dated 19 December 2006 confirming that it has made payments to the Claimant trading as Yorkshire Properties, 97 Kettering Road, Northampton;

b.

A tenancy agreement dated 1 July 1999 in respect of 41 Dorset Mount Road, Leeds showing Ilyas Bhatti’s address as 75 Ether Street, Northampton; and

c.

A tenancy agreement dated 18 October 1999 in respect of 59 Knox Road, Wellingborough signed by Ilyas Bhatti on behalf of Yorkshire Properties as tenant.

2.

This new evidence would have had an important influence upon the result of the trial for the following reasons:

a.

The Claimant’s case that he carried out business from 97 Kettering Road is supported by the letter from Wakefield Metropolitan District Council referred to above.

b.

Ilyas Bhatti denied any knowledge of 75 Ether Street, Northampton. The tenancy agreement dated 1 July 1999 showing his address as 75 Ether Street is prima facie evidence that his evidence in this respect was false.

c.

Ilyas Bhatti denied any dealings in respect of 59 Knox Road, Wellingborough and any dealings with Yorkshire Properties. The tenancy agreement dated 18 October 1999 is prima facie evidence that this evidence was false.

3.

Further, the Claimant is in the process of obtaining expert evidence from a handwriting expert to establish that signatures on the cheque dated 30 March 2001 and the tenancy agreement dated 18 October 1999 were signed by Ilyas Bhatti who denied that both of these signatures were his during the trial. This evidence would have had an important influence upon the Learned Judge’s assessment of Ilyas Bhatti’s evidence. Had the learned Judge had the benefit of the anticipated handwriting expert evidence, he is less likely to have made his finding that the Claimant tried to deliberately deceive the court. On the contrary, the Learned Judge is likely to have found that the Claimant was telling the truth and that Ilyas Bhatti’s evidence was discredited.

4.

The Claimant is also in the process of obtaining expert evidence from a handwriting expert to establish that the letter dated 23 November 1999 at page 146 of the trial bundle was signed by Tariq Bin Younis on behalf of West Yorkshire Properties. This was denied by Tariq Bin Younis.”

It is right to say at the outset that the judge had in fact taken a poor view of all witnesses except possibly the first defendant. Furthermore his view of the claimant’s credibility was not entirely dictated by his view that the claimant had forged a document or documents. As already indicated he had found that the claimant in suing the Leeds City Council had acted dishonestly since he accepted the likelihood that the City Council’s evidence, that there were in fact no asylum seekers lodging in the properties, was likely to be true.

Furthermore so far as the handwriting report of Robert Radley is concerned it has one major weakness as any support for the claimant’s case in so far as Robert Radley was in all but one instance examining copy documents. Having opined in relation to the documents which he was asked to consider that the signatures were genuine he added a note at the end of his report that said this:

“I am unable to exclude the possibility that the signatures appearing on these copy questioned documents could have been transferred from other documents bearing genuine signatures of the parties concerned. Transposition by way of either photocopied, cut and paste or by computer scanning and reprinting are simple processes and, if undertaken with a modicum of care, are generally not detectable.”

Since if there was any fabrication of documents so far as copy documents were concerned, the most likely way that the documents would have been fabricated was by use of the photocopying machine, this report could in fact be of very little assistance in relation to such documents.

I turn however to the individual documents identified in the grounds of appeal.

In summary, so far as the above documents sought to be put in and the Robert Radley report are concerned: (1) The Robert Radley report adds very little to the position as it was before the judge; (2) documents (b) to (e) above were available at the trial or certainly could have been with reasonable diligence. Even document (a) it is difficult to say why it should not have been available at the trial. (3) None of the documents, in my view, has any impact on the judge’s findings as to the claimant’s membership of a partnership with the defendants during December 1999 to January 2000 nor, I should add, on the judge’s finding that the claimant had forged a document, a matter with which I should finally deal.

The document the judge did expressly find to be a forgery was page 177 of the trial bundle (page 115 of our bundle). This was a document addressed to Mintridge Investments, headed Yorkshire Properties, bearing a typed “signature” of Ilyas. It was marked “office copy”, the indication being that an original had been sent to Mintridge Investments, signed by Ilyas. At the trial the point was made that a manuscript draft of this letter, in the claimant’s writing, existed (page 234 of the trial bundle). That draft included the signature “Ilyas” in the claimant’s writing. The mobile phone number on the letter was the claimant’s. The claimant said he had left the draft for the office to type up and put his own mobile number on it because he (the claimant) was dealing with it. Why, if the claimant was dealing with it, did the claimant have “Ilyas’” signature put on it? The answer is not obvious. Furthermore, if the letter was an office copy, Mintridge Investments would have had the original. If that had been produced it would have shown whether Ilyas did sign the letter for Yorkshire Properties. That document was never produced. None of the evidence sought to put in on this appeal could support an appeal against the judge’s finding in relation to this document.

I should finally mention CPR 32.19 on which at one stage Mr Dingemans placed some reliance. He suggested that since there was a deemed admission of authenticity under CPR 31.19 the claimant was taken by surprise by the allegation of forgery made to him in cross-examination. The point was rightly not ultimately pursued. The claimant was put on notice of a challenge by Ilyas’ statement paragraphs 11,12 and 17, and no protest having been made at the trial it was too late to take the point on appeal.

In the circumstances, even if the application for permission had been brought in time, I would have refused permission to appeal and the admission of any fresh evidence, and it thus goes without saying that the application for an extension of time must be refused.

I agree.

I also agree.