Osuji v Holmes & Ors

This matter comes to us as a second appeal from the orders made by HHJ Bailey on 27 May 2010, permission to appeal to this court having been granted by Elias LJ. He granted that permission, and we have to take it on the basis of the grounds of appeal that were before him. Those grounds of appeal do not refer to a point via which the applicant now wishes to take, namely that the discontinuance notice was conditional.

That argument was not raised in the grounds of appeal from the district judge to Judge Bailey. It has not been raised in the grounds of appeal to us. In order to obtain permission Mr Khan has two insuperable obstacles to overcome. The first is this is ten months or so out of time and no good reason is advanced to put forward a new claim at this stage. More importantly and fatally, this is a second appeal; permission can only be granted if there is an important point of practice or principle or some other compelling reason to advance this second appeal. There is none in an argument that the notice of discontinuance was conditional. It is utterly hopeless because there is nothing in the rules that allow a conditional notice of discontinuance to be placed before the court. I would refuse permission to appeal.

This extraordinary appeal, when stripped to its essentials, turns on the proper meaning to be given to CPR 38.2. That rule gives a claimant a right to discontinue all or part of a claim at any time. But as 38.2(2) makes clear:

The crisp issue to resolve on this appeal is whether in this case the claim in relation to which the court is being asked to discontinue it is one in relation to which "the court has granted an interim injunction".

The facts giving rise to this appeal can be summarised in this way. At about 7.00pm or thereabouts on Wednesday 9 April 2008 bailiffs visited the offices of the claimant solicitors, VLS Solicitors, in order to obtain payment of unpaid non-domestic rate liability. The solicitors disputed his right to that payment and in the standoff that occurred a telephone call was made to Sullivan J (as he then was) -- the out of hours duty judge of the Queen's Bench Division of the High Court -- for injunctive relief. Apparently the bailiff spoke on the telephone to Sullivan J. Be that as it may, he granted an injunction overnight restraining a Mr Holmes, the bailiff, from taking action on the Magistrates Liability Order dated 28 January 2008. He directed the matter to be returned to him the following morning, which duly happened.

Thus, on 9 April 2008 Sullivan J (as the Applications Judge) had before him an application notice issued that day on behalf of VLS Solicitors naming Mr Holmes and persons unknown as the defendants, seeking the continuation of the order that Mr Holmes be restrained from acting on that liability order until trial or further order. Part C of that application, verified by a statement of truth, sets out some of the background and the reasons why that firm of solicitors asserted the liability was not theirs but of another practice with which they had no direct connection.

The application was supported by the affidavit of Mr Osuji, who was a partner of the claimant firm, and he too set out a bit of the background and described the events that had happened the previous evening. He concluded that by stating in paragraph 2.1 of that witness statement that his office had “suffered serious embarrassment and humiliation and by reason of all of the above, suffered loss, distress and inconvenience.” He complained that the attendance of the bailiffs was “procedurally flawed, unfair and unreasonable in the circumstances. It was a form of intimidation and harassment”.

Counsel who appeared on the claimant's behalf was an Ms Ellen Anokye. There may, as we learnt in the closing moments of the submission, be some doubt about her strict entitlement to appear as counsel at the English bar, she being more qualified in Ghana, but, be that as it may, she submitted on the claimant's behalf a skeleton argument in which she defined the issue for the judge in these terms:

She then recited her submissions on the law, including at paragraph 1.3 this observation:

In paragraph 1.7 she stated:

In the course of the proceedings to discontinue, to which I have averted briefly, a witness statement was served by a Mr Ogilvy, a legal consultant who was at court that day, and he says this:

The order as drawn by the Queen's Bench Division was to this effect:

Costs were reserved and that is all that it says. It is to be stated at once that as drafted the order would not have complied strictly with paragraph 4 of the Practice Direction 25A. That sets out how applications should be made where a claim has not in fact been issued at the time of the injunction is sought, and it provides that:

“4.4(3) an order made before the issue of a claim form should state in the title after the names of the applicant and respondent ‘the Claimant and Defendant in an intended action’.”

That was not done.

The claimant duly commenced proceedings as they had undertaken to do, but they did so not in the High Court but in the Edmonton County Court, which was close to their offices, and the claim form names VLS Solicitors as the claimant and names Newlyn plc and Mr Chris Holmes collectively as the first defendant and the London Borough of Harringay as the second defendant. The claim as brought recites that the first named defendants acting on instructions of the second named defendant unlawfully attended the business premises of the claimants under the guise of a liability order to which a purported warrant had been issued, but was not produced or served on the day in question, being 9 April 2008. The said liability order was never issued against the named claimants; neither was the warrant of execution directed or issued under the claimant's business address. The entire action or deed executed on 9 April 2008 amounted to intimidation and trespass, and accordingly the claimant claimed damages of not less than £30,000 but not exceeding £50,000. In time that claim was amended, but I need not trouble to recite those details.

Eventually the claimant had occasion to reassess its position in without prejudice correspondence save as to costs. It attempted to negotiate a consent order to have permission to withdraw the claim on the basis that there was no order for costs. That was not acceptable to the defendants. No consent order was made and thus, faced with that position, the claimants sent a fax message on 15 December saying “please find attached notice of discontinuance filed at court”. That notice of discontinuance on the appropriate court form tells the parties and the court that the claimant discontinues all of this claim against the following defendants, though they were not identified, and by implication, as is common ground, it must have affected all of them. The claimant certified that he had served a copy of the notice on every other party to the proceedings.

At first one of the defendants took the view that the claimant could not discontinue without permission having regard to the injunction that had been granted. The second defendant took the view, not surprisingly, given the terms of CPR 38.6, which provides that:

“Unless the court orders otherwise, a claimant who discontinues is liable for the costs which a defendant against whom the claimant discontinues incurred on or before the date on which notice of discontinuance was served on the defendant.”

So the second defendant, the London Borough of Harringay, duly prepared a bill of costs for which it submitted for assessment.

On 24 March 2009 a default costs certificate was duly issued for some nearly £7,000, the costs incurred by the Harringay Borough Council. Faced with that the claimant then picked up the argument that the defendant was not entitled to assess costs because the discontinuance notice was a nullity in view of the fact that the court had not given permission to discontinue pursuant to CPR 38.2(2). That issue therefore came before District Judge Lightman and, after a full argument and after an extremely lengthy judgment, he dismissed that application on 22 March 2010. The claimant appealed with leave of the county court judge to HHJ Bailey and, on 27 May 2010, Judge Bailey dismissed that appeal. Elias LJ has given permission to appeal to this court.

Mr Arfan Khan valiantly appears for the appellant and submits that the County Court was one in respect of which a High Court injunction existed and consequently permission was required in order to allow the claim to be discontinued. We refused him permission to appeal out of time on a basis that the discontinuance was conditional. As I said at the beginning of the judgment, this depends on the proper construction to be given to CPR 38.2(2):

The first issue and, as far as I am concerned, the primary and ultimately the only issue is, what is the proper meaning to be given to the word "court" which appears in 38.2(2)(i)? It is quite clear in my judgment that in the first part of 2A a claimant must obtain the permission of the court. The court there referred to what is to be the court which is dealing with the application for that permission. This was a county court claim and in order to seek permission to discontinue it the application would have had to have been made to the county court. In that case it seems to me impossible to read the words "the court has granted an interim injunction" so as to give the word “court” in that part of the rule a different meaning from the “court” in the first part of the rule. It is as clear as can be, in my judgment, that they refer to the same court. There is nothing in the definition of court which prevents that conclusion. A court is defined in CPR 2.3(3) as follows:

If that construction is correct, the answer to the appeal is obvious: the court which granted the interim injunction was to the High Court; the court which would have had to have given permission is the county court. They are not speaking of the same thing, and therefore CPR 32.2(2) cannot apply.

If one asks perhaps the second question, whether there is a claim in relation to which the court has granted an interim injunction, one arrives at exactly the same conclusion. The claim in relation to which the court granted an interim injunction was that which was indicated to Sullivan J by counsel to be a claim for some relief by way of case stated or perhaps by way of judicial review, but in any event not the claim for damages for trespass and harassment and intimidation which was actually brought.

When one looks at the order made by Sullivan J and seeks to construe it as one must, the answer is obvious. That was an order made in the High Court. The claimants undertook to commence proceedings within seven days of the date of the order. The only possible implication and interpretation to be placed on that order is that the proceedings which the claimant undertook to commence would be proceedings in the court which was granting the injunction, namely the High Court. That is made abundantly clear by the way the case was presented to the judge as an application in anticipation of proceedings in the High Court. There is no earthly reason whatsoever why Sullivan J should have thought for a moment that the proceedings which were to be commenced would be county court proceedings simply because the claimant's solicitors happened to practice next door to the Edmonton County Court. On a proper construction of his order the contemplated proceedings were High Court proceedings and not county court proceedings and could not therefore have been referable to a claim in the county court.

For both those reasons, my preference being for the former, I would dismiss this appeal.

I am grateful to my Lord for his summary of the facts. I agree that the central question for the decision of this court is whether for the purposes of CPR 38.2(2)(a)(i) an interim injunction had been made in action No 8ED01960 issued in Edmonton County Court, subsequently transferred to Central London County Court. If it had not, the claimant did not require the permission of the court to discontinue that action; if it had, the claimant required the permission of the court and a notice of discontinuance served on the Central London County Court was a nullity.

Mr Khan and Mr Emezie have sought to persuade the court that the terms of the order made by Sullivan J (as he then was) should be construed as having been made in the county court proceedings. It has been submitted that the words "and upon the claimants undertaking to commence proceedings within seven days of the date of this order" should be construed as applying to any proceedings the claimant should thereafter choose to issue relating to the subject matter in respect of which the injunction was granted. I cannot so construe Sullivan J's order.

Counsel, Ms Ellen Anokye, represented the claimant both during the telephone application to Sullivan J and the following morning on 10 April 2008. We have been informed by Mr Khan and Mr Emezie that there was no oral argument presented to Sullivan J on 10 April. He had, however, been provided with the claimant's skeleton argument drafted by counsel. In it he was informed that the issue which arose in the proceedings was "whether or not bailiffs entered to enforce purported liability order (without serving a copy of it) against a person or business who has not [been] in occupation of a business premises."

Sullivan J was informed in paragraph 1.3 of counsel's arguments under the heading "The Law" that the application was being made in anticipation of proceedings in the High Court. It was furthermore explained that the claimants, the solicitors' firm, intended to apply within seven days by way of case stated to challenge the liability order which had been referred to as the issue in the case.

In those circumstances, despite the absence of express words in the Order itself, it seems to me that there cannot be any question or doubt but that Sullivan J accepted an undertaking offered by the claimants that proceedings would be commenced within seven days in the Queen's Bench Division of the High Court of Justice.

That being the case, no consent was required at the time notice of discontinuance was granted and, accordingly, the appeal should in my judgment be dismissed.

I agree that this appeal should be dismissed for the reason given by my Lords.