Uppal v Uppal & Anor

This is an adjourned application for permission to appeal from an order made on 7 July 2006 by HHJ Oliver-Jones QC sitting in the Wolverhampton County Court at Birmingham in proceedings brought by the applicant, Mrs Bhajan Kaur Uppal, for possession of a dwelling house known as 5 Park Hall Road, Wolverhampton.

The applicant was registered as owner of that property under title SF28157 on 28 June 2001 following the death of her husband, Mr Makhan Singh Uppal, intestate on 11 July 1999. The property had been purchased in the joint names of Makhan Singh and his father, Mr Chanan Singh Uppal, on 5 August 1977. Chanan Singh had died intestate in April 1998, leaving a widow and four sons, of whom Makhan Singh was the eldest. Until 1986 or thereabouts the whole family lived at 5 Park Hall Road. In 1986 the youngest son purchased a home of his own and moved out. He was followed by Makhan Singh and his wife, Bhajan Kaur. They moved to a home of their own in 1988. In 1992 the second son, Mr Nagina Singh Uppal, also moved out to live in a home of his own. Thereafter the third son, Mr Harmel Singh Uppal, and his family continued to live with his parents at 5 Park Hall Road. After the death of his father, Harmel Singh has lived there with his mother, Mrs Chanan Kaur Singh, until today.

These proceedings were commenced on 6 June 2002. The sole defendant to the claim was Harmel Singh. The claim was made on the basis that the claimant, Bhajan Kaur, as registered owner of the property, was entitled to possession in the circumstances that she had terminated the license under which Harmel Singh was in occupation by a notice to quit expiring on 12 April 2002; so that thereafter Harmel Singh was in occupation as a trespasser. The notice to quit was endorsed with a note that it applied to Harmel Singh and his family but did not apply to his mother: “… who, if she wishes to remain in the premises may do so on terms to be agreed with [the claimant]”.

The response to the claim as eventually pleaded in a re-amended defence and part 20 counterclaim served on 13 June 2005, was a claim that the claimant as successor in title to her late husband held the property on trust for Harmel Singh as to a five-eighth share. That pleading referred, at paragraph 6(xi), to a family meeting in August 1992 at which it was said that Chanan Singh and his four sons were present. It was alleged that, at that meeting, Chanan Singh and Makhan Singh agreed that, to give effect to the father’s wishes with regard to the beneficial shares in 5 Park Hall Road, the property would thereafter be held on trust as to a five-eighth share for Harmel Singh and as to a one-eighth share for each of the other three sons. Chanan Kaur was not to have any beneficial interest in the property, but was to be encouraged and allowed to occupy 5 Park Hall Road as her home for as long as she lived. At paragraph 10 of that pleading Harmel Singh averred that he had acted in reliance on that promise and agreement by making his permanent home at 5 Park Hall Road (and, by implication, making a home there for his mother), assuming responsibility for the outgoings and expenses and carrying out certain improvements; and it was said that, in reliance on that assurance, he had made no claim on other family properties, including a business premises known as the Factory at which a laundry business had previously been carried on by the brothers through a limited company.

In the meantime Chanan Kaur had obtained letters of administration to her late husband’s estate and had been joined to the proceedings as second defendant; as a defendant, to Harmel Singh’s part 20 counterclaim and as herself a part 20 claimant. She claimed rectification of the 1977 transfer so as to reflect what she alleged were the intentions of her husband and Makhan Singh at the time of purchase in 1977: that is to say, a common intention that they hold the property as tenants in common. But paragraph 14 raised a claim that, in the event that they had held as beneficial joint tenants as declared in the transfer deed itself; then, by a mutual course of dealing between them, Chanan Singh and Makhan Singh had indicated an intention that they were thereafter to be tenants in common and had so severed the beneficial joint tenancy.

The proceedings came before the judge for trial. The trial occupied the time of the court for no less than 16 days. In the course of the trial the judge heard oral evidence from the claimant and from two of her brothers-in-law, Harmel Singh, the defendant, and Nagina Singh, the second eldest brother. There was no oral evidence from the widow, Chanan Kaur, who was old and in a frail state of health. The judge recorded the impression made upon him by the witnesses in the following passage:

“I have been very much assisted by the impression I have formed of the witnesses and the extent to which I believe they were seeking to assist me in unravelling the factual history. Each of them gave evidence over several court days and this gave me ample opportunity to assess their truthfulness and reliability. I can say, without hesitation, that I have found both the first Defendant and his brother, Nagina, to be essentially truthful witnesses doing their best to recall (albeit not always accurately) the facts to which their evidence was directed. On the other hand, and regrettably, I must conclude that I can not say the same about the Claimant. To the extent that she had any recollection of any relevant facts – which, in my judgment was very limited – she clearly demonstrated a determination to ensure that her evidence would be tailored to maximise her ultimate ownership and control of property – in particular, of course, 5 Park Hall Road.”

The judge made a number of important findings of fact. He found that 5 Park Hall Road was purchased to provide a permanent home for family members so long as they wished to live there. He found that both Chanan Singh and Makhan Singh regarded themselves as having equal and distinct 50 percent shares in the property, notwithstanding that the transfer described them as joint tenants. He went on to say that, if that was not their original intention at the time of the transfer in 1977 -- and for the purposes of a claim for rectification he could not be sure that it was at that date -- he was quite satisfied that by their conduct and agreement at later dates they were in fact dealing with each other as if each owned a separate and distinct 50 percent share. That was the understanding of all members of the family; and indeed the understanding of the claimant herself. He explained that that agreement was nowhere more clearly demonstrated than at the time of the meeting in 1992 which was alleged in paragraph 6(xi) of the defence, and to which I have referred. He also found as a fact that Harmel Singh had relied to his detriment on the promise made in 1992 as pleaded in paragraph 6(xi): that is to say, that Harmel Singh relied on the promise that he would have Makhan Singh’s half share of 5 Park Hall Road. As the judge put it:

“He [Harmel] improved the property; he made no alternative provision for any home for himself, his wife and children as he could, and as I find he would have done, had he considered that he was not to acquire a legal interest in the property. As a working man, he could have afforded to pay his own mortgage for alternative accommodation had he wished to do so. As it was he was happy to live in 5 Park Hall Road on the basis, as I find, of what had been promised to him. My reasoning for this crucial finding of fact lies in my acceptance of the evidence about the 1992 discussions given by both the first Defendant [that is Harmel Singh] and Nagina.”

And he went on to observe that -- other than denying that that 1992 agreement had been reached, on the basis that, had it occurred, she would have known about it but had not been told about it by her husband -- the claimant was unable sensibly to challenge that conclusion.

It is important to note that that critical conclusion -- that there had been a meeting between Chanan Singh and his son, Makhan Singh, at which the other three sons had been present in August 1992 and that, at that meeting agreement had been reached between the then beneficial owners and the wider family as to the disposition of the beneficial interests -- was made by the judge on evidence which the judge accepted and which was not seriously challenged (in the sense that there was no one to give contrary evidence of what had happened on that occasion).

On the basis of that finding of fact the judge held -- directing himself by reference to Hunter v Babbage [1995] 1 FCR 569 -- that the original beneficial joint tenancy declared in the transfer document had been severed from at least 1992: so that, on the death of Chanan Singh, his one-half equal severed share formed part of his estate and passed to his widow Chanan Kaur. He observed that for that -- if for no other reason -- Chanan Kaur had a right to possession of 5 Park Hall Road. She was entitled to permit Harmel Singh and his family to reside with her. He noted that, by closing submissions on his behalf, it had been made clear by Harmel Singh that he was not pursuing his claim to the extra one-eighth share: that is to say, to one-quarter of the half share of his father.

The judge then went on to consider whether Harmel Singh, himself, had a one-half share by virtue of the agreement that had been made in 1992 and his reliance upon it. He was satisfied, first, that it had been promised by Makhan Singh that his one half severed share would be held for Harmel Singh; and, second, that Harmel Singh had relied upon that promise in such a way as to make it unconscionable for Chanan Singh, or the claimant (as his successor), to seek to claim a beneficial interest in that one-half share. The judge held, in effect, that there was a constructive trust of Makhan Singh’s half share in favour of Harmel Singh. He said this:

“Given the first Defendant’s circumstances as they were in and after 1992 coupled with the repeated assurances he was given, it is, in my judgment, unquestionable that but for the agreement reached with Makhan he would (a) not have expended significant sums subsequently on the improvement of the property at 5 Park Hall Road and (b) would not have continued to live there paying, as I find he did, all of the outgoings required for the maintenance of the premises, but would have acquired his own home for his family as his other brothers had done and (c) would not, effectively, have relinquished any right to a share of the factory premises from which the family business operated to which he had indirectly contributed.”

The judge gave effect to those findings by an order which declared that the beneficial interest in the property at 5 Park Hall Road was held as to one half by the first defendant, Harmel Singh, and as to the other half by the estate of Chanan Singh, represented by the second defendant Chanan Kaur. On the basis of those findings he dismissed the claim for possession made in the proceedings.

Some indication of the costs of this exercise -- in relation to a property which is valued at no more than £150,000 -- can be seen by the provisions in the order of 7 July 2006. The claimant was to undertake to pay into her solicitor’s client account from the proceeds of sale of the Factory premises £80,000 on account of the first defendant’s costs and £100,000 on account of the second defendant’s costs. So this has been an exercise in which the costs have far outweighed the value of the property at stake.

The judge refused permission to appeal. The application for permission to appeal came before Neuberger LJ on the papers. He ordered, on 20 November 2006, that the application for permission be adjourned to be heard on notice to the respondent with an estimated time of half a day. It is that adjourned application which has been before us today.

The application for permission to appeal is made on the basis of the six grounds on which the applicant seeks to appeal. The first ground is that the trial was unjust and seriously irregular. It is said that the judge, throughout the course of the evidence and submissions, made constant and frequent interruptions such that he had, amongst other things, “descended into the arena and the dust of battle had clouded his vision and had deprived himself of the advantage of calm and dispassionate observation”; and had hampered his ability to evaluate and weigh the evidence properly and otherwise make decisions. I will turn to the other grounds later in this judgement.

In support of that first ground we were reminded of the observations of Lord Green MR in Yuill v Yuill [1945] P15; and, more recently, of Jonathan Parker LJ in London Borough of Southwark v Kofi Adu [2006] EWCA Civ 281. The principles are well known. The Kofi Adu case provides an illustration of how they are to be applied following the introduction of the Civil Procedure Rules. As Jonathan Parker LJ observed, the risk is that the judge’s descent into the arena may so hamper his ability properly to evaluate and weigh the evidence before him as to impair his judgment and may for that reason render the trial unfair.

We were taken to transcripts of the hearing before the judge: in particular, to the transcripts of the evidence. The first, and to my mind, most important observation to be made on those transcripts is that there is nothing there to suggest that the judge descended into the arena in relation to the critical question which he has to decide: what had happened at the meeting in August 1992? It is clear, from looking at the transcript, first, that counsel for the claimant was able to put whatever questions he wished to both Harmel Singh and Nagina Singh without any interruption or intervention by the judge; and that he did so. Second that the claimant’s challenge to those two witnesses in relation to the events at the meeting of August 1992 -- put through her counsel -- was so muted as to be almost inaudible. There was no serious challenge in cross-examination to the evidence of Harmel Singh and Nagina Singh. Whatever part the judge may have played in the trial in other areas, he did not leave himself open to criticism in relation to the cross-examination of those two witnesses. Nor did he do so in relation to the claimant’s evidence: she was not in a position to give evidence about that meeting in August 1992 because she was not there.

Third, it is true that there are passages in which the judge can be seen to be putting to Harmel Singh his understanding of what Harmel Singh’s case was in relation to other matters; in particular in relation to a written document which had been produced at a late stage and which purported to record a meeting which had happened in the year 2000 or thereabouts. The judge plainly thought that it was Harmel Singh’s case that that document had been prepared in advance by a family friend, a Mr Matto; and he put questions which had the effect that Harmel Singh agreed that that was indeed his case. The effect of those questions was that the judge found that he could place no reliance on that document, because plainly, it was not a record of any agreement that had actually been made between the parties in 2000. But that was a conclusion which the claimant was inviting the judge to reach. It was the claimant’s case that that document did not record any agreement. In the course of his judgment, the judge indicated that, although he could not be sure of the provenances of that document, he found no assistance in it. The claimant’s criticism in this respect is not that the judge was wrong to reach that conclusion; rather that the judge was wrong to feel confident that Harmel Singh had had no part in preparing or producing that document. Counsel submitted to us that -- had he been able to cross-examine Harmel Singh more rigorously on that document -- he would have obtained an admission from Harmel Singh in effect that Harmel Singh had fabricated the document. That seems to me unrealistic: the chances of getting a witness to make that sort of admission are very much more in prospect than they ever turn out to be in reality. But it was open to counsel to put that point to Harmel Singh that he had fabricated the document, if he wished to do so. He did not put that point.

It may be said that, on that particular issue, the judge -- in his understandable anxiety to ascertain what Harmel Singh’s case actually was in relation to that document; an anxiety which led him to the conclusion that the document was of no help to anyone -- may have asked questions of Harmel Singh which could be described as leading. But that is a long way away from supporting a conclusion that the judge descended into the arena. The judge was not, in any sense, putting questions in a manner which suggested hostility to either side. He was simply attempting to discover what that witness’s evidence actually was. The effect was that Harmel Singh was led to give evidence which was favourable to the claimant on that point.

We were taken to another example -- in relation to the accounts of the family companies -- in which the judge was seeking to satisfy himself that there was a reason why the younger brothers, who had worked in the business, had been content to accept accounts of the company’s affairs which showed, contrary to their own evidence, that they had been paid remuneration and dividends. The judge -- who was clearly basing his questions on his knowledge from earlier cases as to what might be expected in a family business in this community -- satisfied himself that, although at first sight, it might seem surprising that members of the family were working for little more than pocket money, that was not a reason for rejecting the evidence that he was being given. But again, that has no relevance to the factual decision which the judge had to make on the events of August 1992.

For those reasons I would reject the suggestion that this trial was unjust or seriously irregular on the basis of material which we have been shown. I would hold that -- assuming that to be the best material available to the claimant, which no doubt is the reason why it was put before us -- an appeal on the first ground has no prospect of success.

The second ground of appeal is that the judge was wrong to decide a number of facts in the way that he did. Those facts are set out in a schedule to the appellant’s notice. The critical fact which the judge decided, as I have said, is that in 1992 there was a meeting at which promises were made. That was a fact in relation to which the judge was entitled to rely on the evidence of those who were at the meeting: evidence which was effectively unchallenged. Examination of the schedule shows that that fact was not one which the judge is said to have got wrong.

Then it is said (as ground 3) that in any event the judge was wrong to find that discussions, promises and assurances made in the period 1983 to 1992 were capable of supporting a case based on proprietary estoppel or on constructive trust. But that submission overlooks, if I may say so, the basis upon which the judge reached his conclusion. He found that facts before 1992 may have provided a motive for the assurances and promise that Makhan Singh made in 1992. But the constructive trust or proprietary estoppel was not founded on what had happened before 1992, but on the promise that was made in August 1992. As I said the fact that that promise was made was essentially unchallenged. There is in my view no prospect of success on that ground.

Then it is suggested (as ground 4) that the judge was in error in balancing the effect of the assurances that he found to have been made against the extent of detrimental reliance by Harmel Singh. It is said that the acts of detrimental reliance amounted to no more than a few thousand pounds spent on some improvements. To be weighed against that, was the fact that Harmel Singh and his family had rent-free accommodation over that period. That, as it seems to me, overlooks, first, the fact that the judge found that one element of reliance was the fact that Harmel Singh refrained from exercising whatever rights he might have had in respect of the management of the companies, the monies which had been taken out of the companies and the properties that had been purchased with those monies. Part of the arrangement of 1992 was that each brother would have his share and a line would be drawn. That is what happened. Second, the submission overlooks the fact that Harmel Singh was taking on the burden of maintaining the family home as a residence for the mother of the four brothers for the rest of her life; rather than going into the market and purchasing a home for himself and his family as the other three brothers had done. He assumed that obligation. The judge took the view that that was an obligation which was properly measured by holding Makhan Singh to the promise that he had made: namely that his share of 5 Park Hall Road would accrue to his brother Harmel. I see no prospect of success on that ground.

The fifth ground is that the judge is said to have been wrong to hold that there had been a severance of the beneficial joint tenancy of 5 Park Hall Road. But to my mind there is no substance in that ground, once it is accepted -- as the judge did accept -- that the father, Chanan Singh, and his co-owner, Makhan Singh, made an agreement in August 1992 as to how the beneficial shares in the property should be dealt with and disposed of. That agreement could only have sensible effect on the basis that they were treating themselves and each other as owners of severed half shares and not as joint beneficial tenants.

The final ground of appeal is that the judge is said to have been wrong in law to reject the claimant’s alternative submission that, in equity, she retained or became entitled to a one-eighth share in the equity of 5 Park Hall Road. That was not a claim that she was making in the proceedings. In the proceedings she was asserting that there was no agreement to that effect made in August 1992. In the circumstances that that claim was not made I see no prospect that an appeal court would entertain that ground of appeal.

For those reasons I have reached the conclusion that this application for permission should be refused.

I agree. I would only add one observation of my own in relation to the venue of this trial. Although the claim began as a possession claim, it became clear on service of the defence that this was a classic Chancery case, as is evident from the issues that my Lord, Lord Justice Chadwick, has canvassed in the course of his judgment. As my Lord as also observed, the case took 16 days when the sum in issue was in the order of £150,000. The costs are at least £300,000. Those facts are no criticism at all of the trial judge, who plainly faced in the trial of this case formidable problems, as appears from his judgment.

However, it seems to me that this is the type of case that should have been transferred to the Chancery Judge at Birmingham so that the trial could have been conducted by a judge familiar with the principles and the case managed in such a way that the time spent at trial was proportionate to the sums in issue. No explanation was given to us as to why the case was not transferred to the Chancery Judge. But it would be desirable I think for the appropriate judicial authorities on the Midlands circuit to given consideration to the arrangements for the hearing of cases such as this and their reference to the specialist Chancery Judge, assuming of course that the long-standing delay in the appointment of a further Chancery Judge at Birmingham has been resolved by the Department of Constitutional Affairs.

It does no credit to our system of justice that a family dispute over a house should have cost sums far in excess of what is in issue. It is no answer to say, as we were told, that this happens in such cases as this.

So the application is refused.