Mehra v Mehra & Aras

This is the judgment in a renewed application for permission to appeal against the judgment of Her Honour Judge Marshall QC, given at the Central London County Court on 28 November 2008 dismissing the claim of the applicant Dr Madhav Mehra against the second and third respondents (Mr and Mrs Aras) in finding for them on the counter-claim. The application was refused on paper by Rimer LJ. This was renewed orally to me.

At the outset of the hearing I was told on express instructions on behalf of Dr Mehra that he was entirely content that I heard this case, although I had given the principal judgment in the court in an entirely separate matter in which Dr Mehra had been the appellant, Greenwood Reversions Ltd v World Environment Foundation Ltd [2008] EWCA Civ 47.

At the hearing of the appeal some further supplementary submissions and, more importantly, a large bundle, had been delivered to the court by counsel for Dr Mehra, but unfortunately the court office had mislaid the file and I had not had an opportunity of reading it. I heard oral submissions. The bundle and further submissions raising a further ground of appeal were sent to me after the hearing, including some on 4 June 2009. I have carefully read and considered these.

Dr Mehra claimed to be the beneficial owner of 101 Park Avenue, Potters Bar. In 1991 the property had been registered in the name of his son, Randiv, the first respondent. In 2007 Randiv had sold it to Mr and Mrs Aras with completion on 21 August 2007. These proceedings were an attempt by Dr Mehra to establish that he was the beneficial owner of the property and to set aside the sale to Mr and Mrs Aras.

An outline of what had happened to the property can be given simply. The property was purchased by Dr and Mrs Mehra in July 1977. In 1987 the property was transferred into the sole name of Mrs Mehra, The explanation given was that Dr Mehra, as an employee of the Indian Government, could not own foreign property. In 1991 Dr Mehra ceased to be an employee of the Indian Government. He purchased property for Mrs Mehra in India. In consequence Dr Mehra claimed that he agreed that the property should be transferred by Mrs Mehra into the names of their son Randiv and Dr Mehra; Randiv would administer the property, but it would be held for Dr Mehra beneficially alone. The transfer was made to “Randiv Madhav Mehra”. It was Dr Mehra’s evidence that the transfer to his son Randiv alone was a mistake; the property should have been transferred to Dr Mehra and Randiv as joint owners in trust for Dr Mehra alone.

On 4 September 2007 Dr Mehra applied for an injunction to prevent Randiv selling the property, but it was then too late as completion had taken place. A few days later he joined Mr and Mrs Aras to the claim. There was a significant amount of evidence in relation to what Mr and Mrs Aras knew about Randiv’s position and the occupation of the property, but, for reasons which I shall explain, it is not necessary to set it out.

The judge heard evidence from Dr and Mrs Mehra, Mr and Mrs Aras and other witnesses. She found:

On the renewed application for permission, it was made clear by Dr Mehra’s counsel that he no longer sought to challenge the findings of fact made in relation to Mr and Mrs Aras. In my view that concession was an inevitable one as there was no material before this court on which the findings of fact involving Mr and Mrs Aras could in any way have been impeached. The renewed application to me was confined to the following grounds, some of which had not been advanced in the original notice of appeal. The appellant had filed his notice of appeal without the benefit of legal advice. The grounds of appeal argued before me were:

It was contended on behalf of Dr Mehra that the judge did not address the issue of credibility correctly. It was accepted, as a reading of the transcript of Dr Mehra’s evidence clearly demonstrates, that there are serious inconsistencies in his account of what he was trying to effect in the transfers in 1987 and 1991. It is contended that the inconsistencies are explained by Dr Mehra’s lack of understanding of the distinction between beneficial and legal ownership. His approach, it is said, was honest and he gave clear evidence as to what he intended in 1991. It is also contended the judge should have had regard to the manuscript letter dated 15 July 2007 when Dr Mehra made clear subsequently that he wished to transfer the property wholly to his son at that time in 2007; he could not have done that unless he was the owner.

In support of this ground reliance is also placed on Ground 2, namely the judge should have had admitted the evidence of Mr Lyal. Mr Lyal was an employee of Dr Mehra or one of his companies in 1991 and had been the person, according to Dr Mehra, who had carried out the transaction in May 1991. The statement set out an account similar to that of Dr Mehra in which Mr Lyal accepted he had made an error in executing the instructions he said had been given by Dr Mehra and that he personally had signed the document, not only as a witness but also for the transferee and the transferor. The witness statement had not been served in time and the judge had refused to admit the statement at the trial.

It was also contended that the judge’s approach to the evidence of Mrs Mehra was inconsistent; she should not have rejected part and accepted part. She should have accepted all Mrs Mehra’s evidence.

I have carefully read the evidence of Dr Mehra and Mrs Mehra and considered carefully the documents provided in the appeal bundle. In my judgement there was no error of approach by the judge. There was plenty of material, within the area of judgement open to her, on which she was entitled to conclude that Dr Mehra’s account was not accurate. For example, it was Dr Mehra’s evidence that he had been the person who provided the purchase price for the property and that the transfer to Mrs Mehra in 1987 was merely a transfer to her name so that there would be no foreign property registered in his name whilst he was an employee of the Government of India. He nonetheless considered that the property remained his. Not only would that have been conduct that was plainly questionable as regards the Government of India, but is difficult to reconcile with his account of the 1991 transaction. In the 1991 transaction, on the evidence that he had given, he was already the owner and there would have been no need for him to pay £63,000. Furthermore his account of authorising Mr Lyal to sign the documents in the way in which they were signed, again evidences scant regard for the proper conduct of business. Furthermore there was an inconsistency in the evidence that he gave that he was to have the whole of the beneficial interests in contrast with what he had pleaded and what he had said in June 2007.

The judge was also entitled to conclude that Mrs Mehra was a person who gave evidence to support her husband loyally. There was nothing wrong in the judge’s approach in accepting part of her evidence but rejecting part of it where such part had been given to support her husband’s evidence. There is nothing wrong in a judge accepting part of a witness’s evidence but rejecting part of it, provided a good reason is set out and a good reason was.

Nor, in my view, was the judge wrong in refusing to admit the evidence of Mr Lyal. Orders of the court are meant to be complied with. In any event very little weight could have been attached to Mr Lyal’s statement, as he had not come to be cross-examined upon it. I therefore conclude that the judge was entirely correct in the findings she made about the effect of the 1991 transaction.

In the light of my conclusions in relation to Grounds 1 and 2, this point does not strictly arise. This argument was advanced in a separate written submission sent after the hearing. It was contended that the judge was wrong in finding that there was no evidence that Dr Mehra was in occupation of 101 Park Avenue. There are, in my view, two points. First the judge concluded that because Dr Mehra had granted a tenancy for Miss Zheleznaya, he could not be in occupation. It is submitted that that was an error of law as on Dr Mehra’s evidence, the tenancy granted had not been intended to confer the right of exclusive possession on her. Second, the judge went on to find that she was not satisfied that Dr Mehra had stayed at the property at all after the time Mr Aras began to negotiate with Randiv. She did not accept that any of the clothes or his personal effects were present in the property. In my judgement, whatever the legal position is in relation to the tenancy of the property, the judge was, given her conclusions on the credibility of Dr Mehra, entitled to reject his evidence in relation to his staying at the property and his personal effects being present at the property.

Even, therefore, if I had come to a different view in relation to the 1991 transaction, Dr Mehra would have failed on this ground of appeal.

In the further submissions sent to the court by counsel on behalf of Dr Mehra, three documents were annexed. The first was entitled, “Submissions in regard to Mr Aras’s active involvement in depriving the appellant, a 71 year old pensioner, of his home in the UK of 32 years”; although it is not clear whether this formed part of counsel’s submissions, I have carefully considered it but I have seen nothing in them that leads me to change the conclusion which I have already set out in relation to the grounds of appeal.

I also was sent by the court office a second witness statement of Dr Mehra setting out further submissions and a submission in relation to alleged commissions of perjury having been made by Mrs Aras.

At the oral hearing before me, counsel for Dr Mehra expressly avowed challenging the credibility of Mr and Mrs Aras. Dr Mehra should not now be allowed to go back on that. Even if he was, I see nothing in the submissions that have been put before me in relation to the credibility of Mrs Aras which would give rise to a real prospect of successfully showing that the judge was wrong to accept their evidence.

In the result, therefore, despite the attractive submissions put forward on Dr Mehra’s behalf by Mr Woolf and the considerable amount of work he has done for him and which Dr Mehra has done, I can see no basis on which the judgment of the judge can be appealed with a real prospect of success. I therefore refuse this renewed application.