Brittain v Haghighat & Anor

On 12 January 2009 Mr George Bompas QC, sitting as a deputy judge of the High Court in the Chancery Division, gave judgment on an application by Louise Brittain, the trustee in bankruptcy of Mr Hamid Haghighat, for an order for the sale of property called 82 Eamont Court, London NW8. His order provided for the property to be sold after three years, or sooner in a particular event, and for possession to be given for that purpose.

The respondents to the application were the bankrupt Mr Haghighat and his wife, who prefers to be named not as Mrs Haghighat but as Nasrin Darabadi. The judge gave permission to appeal to all parties. The trustee in bankruptcy has not appealed but both the respondents have done so. Each appeal was out of time, but Etherton LJ granted an extension of time in each case.

Thus the court has before it an appeal which has the number A2/2009/0477 by Mr Haghighat, and another appeal which has the number A2/2009/2160 by Nasrin Darabadi. Neither appellant has appeared or been represented before the court today, although having ample notice of the hearing date; each of them is aware of the hearing date, as is apparent from recent communications, which I will mention.

Mr Haghighat has made a number of requests over time by letter for an adjournment of the hearing date. The case was originally due to come on for hearing on 21 October 2010 -- I say originally, it may have been due on an earlier date, but for present purposes it was due for hearing before my Lord and myself on 21 October 2010. Before that date Mr Haghighat made requests by letter for an adjournment, firstly because he needed more time to seek to get legal representation and later because of his ill health which, he said, would prevent him from attending to argue his appeal.

On 21 October 2010, notwithstanding his profession that he was unable to attend, Mr Haghighat came to the Royal Courts of Justice and appeared to be heading for the court in which the hearing would take place, but he suffered an accident in the building and was taken to hospital by ambulance. On that date we adjourned the hearing and a new date was fixed for today, of which he and Nasrin Darabadi were given notice.

For all relevant hearings below Mr Haghighat was in person, while Nasrin Darabadi generally had solicitors and counsel; now on the appeals both are unrepresented.

A day or two ago the court received a letter appearing to be from Mr Haghighat dated 29 November 2010. It may be that it was typed by his daughter, who I understand gives him assistance, but it appears to be signed by him. He accepted that he had notice of the hearing, but stated that he was unable to attend today due to being ill. He gave some details of his medical appointments and his medical problems, of which the court is aware. He referred to the fact that another court hearing that was due before a Master in the Chancery Division in relation to other proceedings brought by him had been adjourned from November to a date in the New Year. He enclosed a letter from his general practitioner, Dr Julia Miller, dated 29th November, stating that he is unwell, suffering from a number of conditions, and too unwell to attend court. Dr  Miller states at the end that it would be preferable if this gentleman's court case be postponed until his physical and mental health conditions have improved. Also dated 29 November is a letter from Nasrin Darabadi stating that she has to attend to the care of her son, to whom I shall shortly refer, and she is unable to attend court for that reason.

Accordingly, both appellants seek an adjournment of the hearing. Before ruling on that I need to explain something about the case. I will describe the history summarily, but I need to start quite a long way back in time.

In 1999 Messrs Beachcroft Wandsworth, solicitors, brought an action against Mr Haghighat, claiming as assignee from Mortgage Express, a mortgage lender, under a mortgage over another property, 1 Charlbert Court, Charlbert Street, NW8. On 15 November 1999 in the Central London County Court HHJ Medawar gave judgment for the claimants in the sum of over £404,000, having previously ordered possession of the mortgaged property. On the same day the judge also made a charging order nisi for that sum over the property with which we are now concerned, Eamont Court. Later in November the same judge heard a separate claim by Mr Haghighat against a Mr Bakhsh and a firm of solicitors seeking an indemnity and the judge dismissed that claim. It seems that the property Charlbert Court was later sold for some £161,000, thereby reducing the debt. As regards the charging order on Eamont Court, the application to make it absolute came before HHJ Cowell in the Central London County Court. That hearing was necessary because Nasrin Darabadi claimed to be the sole beneficial owner of the property in which case it could not be charged as security for the judgment debt against Mr Haghighat. HHJ Cowell heard this application in May 2000. On that occasion Nasrin Darabadi relied on, first of all, an oral agreement made in 1994 between herself and her husband; and, secondly, a declaration of trust dated 5 November 1999. The judge rejected the contention that there had been any oral agreement on the evidence and, although he accepted that there was a declaration of trust dated 5 November 1999, he set that aside under Section 423 of the Insolvency Act 1986 as a transaction made at an undervalue and intended to prejudice creditors.

In January 2002 the solicitors, or two of the partners in the firm, presented a bankruptcy petition against Mr Haghighat based on a debt of some £309,000, which represented the balance of the original judgment debt and costs after crediting the proceeds of sale of Charlbert Court. The bankruptcy order was made on 27 February 2002 and Louise Brittain was appointed as trustee in bankruptcy in May 2002.

It seems that each of the defendants, Mr Haghighat and Mrs Darabadi, sought permission to appeal against the order of HHJ Cowell in relation to the charging order. Mr Haghighat's application was very much delayed in its progress and came before Patten J on 22 May 2003, when it was dismissed. I suspect that Nasrin Darabadi's application had already been dismissed in the meantime. I have no doubt that it has been dismissed.

Eventually, in 2006, the trustee in bankruptcy applied for an order for sale of Eamont Court, making both Mr Haghighat and Nasrin Darabadi respondents. By that time the respondents sought to rely on a different trust deed, appearing to be dated in 1995. Eamont Court appeared to be the only asset in the bankruptcy. That application for an order for sale came before Mr Bompas in December 2008. He heard first a preliminary issue as to whether it was open to the respondents to assert that Nasrin Darabadi was the beneficial owner of the property after all. He ruled that it was not, because the point had been decided by HHJ Cowell in 2000 and was concluded as between all three parties. That was a ruling that he gave on 2 December 2008 from which he refused permission to appeal. The respondents sought permission to appeal from the Court of Appeal, but that was refused by Etherton LJ.

Mr Bompas then had to consider the application for an order for sale. He heard argument on that and gave a reserved judgment on 12 January 2009. He had to balance the interests of the creditors and the trustee in bankruptcy on the one hand and the circumstances of the respondents on the other, having regard to Section 336(4) and (5) of the Insolvency Act. Under those provisions, unless the circumstances are exceptional, the interests of the creditors are to outweigh all other considerations on an application of this kind made more than a year after the appointment of the trustee. The judge accepted that there were exceptional circumstances. Those are that the oldest child of the respondents, who is now aged 25, is severely disabled and requires continuous care, which is provided and practised by Nasrin Darabadi. The judge heard evidence from two expert witnesses. He reviewed the evidence and the position at length and with great care. He came to the conclusion that he should make an order for possession but subject to a substantial period of deferment. I will read paragraphs 82 and 83 of his judgment, in which he set out his conclusion:

“82.

After careful consideration of the matters set out in this Judgment, my clear conclusion is that I should make an order for possession of the Property to be given to the Trustee; but, nevertheless, the order for possession should be deferred for a substantial period or until, if sooner, three months after Mani has ceased permanently to reside at the Property.   That substantial period, which I think should be three years, I have decided on with a view to allowing (a) the local authority to make provision for Mrs Haghighat and Mani to be rehoused (together, if appropriate but not necessarily, with Mr Haghighat and the other children) in accommodation which will be suitable to their needs, and (b) an orderly change to be effected (so far as change is made necessary by the move to new accommodation) in the care arrangements for Mani.   As to this I did not understand Mr Eyres’ evidence to be that the Council neither could nor would ever offer suitable alternative accommodation; rather, it was that in the absence of an order for possession an offer of suitable alternative accommodation could be expected within six to eight years.   While recognising that the Council may have difficulty in accelerating any offer in the short term, I cannot think it unrealistic to expect the Council to make a suitable offer within three years in the face of an order for possession within that time.

83.

The order I have decided on is a compromise between the two other possible alternatives.  It is far from ideal; but in the circumstances I consider that it is the best possible balance between the competing interests of those concerned in the present case, and that it is just and reasonable having regard to the matters which IA 336(4) and 337(5) direct to be taken into account.”

He made that order under which the property is to be sold and possession given within three years, or earlier if Mani [the eldest child] ceases to reside permanently at the property, whichever of those dates is the sooner.

Mr Haghighat had not been present for the whole of the hearing, and, although present at the date of judgment, he then attended without an interpreter and said that he could not understand what was being said to him in English. The judge gave Mr Haghighat permission to apply within 28 days if he wished to address further argument on the question of costs or on other aspects on the form of the order to be drawn. That was evidently not intended to give Mr Haghighat permission to apply in order to reopen the matter generally.

Mr Haghighat did apply to set aside the judgment and he applied across the board, so to speak, rather than just on the question of costs or the form of order. That application came before Mr Bompas on 23 March 2009. Again the judge considered it with great care and gave a reserved judgment on 28 May 2009. He accepted part of Mr Haghighat's case as to the court not having been shown all relevant judgments, but concluded that the fact that the court had not seen a number of relevant documents could have made no difference to the result. Permission to appeal against that order was refused by Etherton LJ.

So, as a result, all that is before us is the two appeals by Mr Haghighat and Nasrin Darabadi against the 12 January order upon which permission was given by the judge. When he gave permission on 12 January he said this on that subject:

Clearly, in giving permission on that basis Mr Bompas envisaged a possible challenge to his judgment as regards the principles on which he had exercised his discretion. That is not the nature of the appeals launched, to judge from the grounds in the appellant's notice and the skeleton arguments. All points there taken deal with the preparation for the various hearings, the conduct of the hearings, and what the appellants say is the injustice of the judge not accepting their case as to the 1995 trust deed. Nothing in the grounds of appeal or the skeleton argument deals in any way with the terms of the judgment dated 12 January 2009 or indeed even mentions the basis of that judgment. If the actual grounds of appeal had been put forward in support of an application for permission to appeal, permission would not have been granted.

Accordingly, the position is that, though judgment with an order for possession was made on 12 January 2009 and was affirmed, despite Mr Haghighat's application for review, in April 2009, he has appealed, as has Nasrin Darabadi, and has lodged extensive documents in support of his appeal, but none of them have any relevance to any possible issue that might demonstrate that the judge's order was not well founded. He has also, as I have mentioned at the outset, made a number of applications for an adjournment of the hearing of the appeals. I have no difficulty in accepting that he is in what may be described as a fragile and difficult medical state. In a sense, that was part of the deciding factors for the judge in deferring the order to settle, which is the need for care for the child. The fact that three years was allowed is something that might permit the need for possession to be given to be accommodated, notwithstanding the medical problems that Mr Haghighat has.

The first question that we have to consider in the light of the latest communications from both the appellants is whether to adjourn the hearing yet further. In my judgment it would not be appropriate to do that. It seems to me that, whilst one can have a good deal of sympathy, particularly for Mrs Darabadi, who is having to cope with her son's extremely problematic medical state, the appeals that have been launched against the judge's order have no prospect of succeeding, and the continued subsistence of the appeals does no more than distract attention from the need to get on with complying with the order in due course and preparing for that compliance in the meantime. The three-year period will expire under the order in January 2012, so there is not a great deal more than a year to go in which such preparations have to be made. It seems to me that it would be not in the interests of any party for the determination of these appeals to be postponed for a period that, on past form and according to the implications from Mr Haghighat and his GP, could be indefinite. It would be inappropriate for any such postponement to be ordered.

For those reasons, I would refuse the application for adjournments on the part of both appellants. Turning to the substance of the appeals, I am satisfied that it is not open to either of the appellants to rely in support of the appeal on the grounds on which they do rely, all of which are points which have been dealt with in orders for which permission to appeal has been refused. In turn, there is nothing in the appeals that provides any arguable basis for challenging the judge's extremely careful and well thought out exercise of his discretion.

It follows that, in my judgment, both of the appeals ought to be dismissed.

I agree. So the application for adjournment is refused and the appeals are dismissed.