Das v Das & Anor

There is before me an appeal by Mrs Dipa Das (“Dipa”) against a decision (“the Decision”) in favour of Mrs Mira Das (“Mira”) of an adjudicator (“the Adjudicator”) appointed by the Chief Land Registrar. It was not drawn to the attention of the Adjudicator that the issue referred to him was an issue raised by Dipa in proceedings commenced by her against Mira in 2002 the case number of which is CH02C0901 (“the 2002 Action”). The parties to the appeal and the parties to the 2002 Action are all acting in person, the papers in the proceedings are in a highly confusing state, the evidence is limited and the facts and issues are not readily apparent. To obtain some understanding of the position required some hours of reading on my part and an exploration of the parties’ respective cases at what was for practical purposes a case management conference. In this judgment I seek to set out as best I can the relevant facts and issues so as to facilitate the parties’ and judicial consideration of the matter requiring determination. The account is not comprehensive and may require to be supplemented and indeed corrected. Since sending draft of this judgment to the parties, I have been sent by Dipa and Mira a large body of material. The general character of that material if correct (and it is impossible as well as unnecessary for me to decide that question) is that it adds flesh to the bare facts set out in the judgment. It does not alter the thrust of the judgment or alter the views expressed. Dipa and Mira are free to address the material to the trial judge.

Dipa and Mira are sisters-in-law. Sachindra Nath (“Nath”) is the husband of Dipa. Both Dipa and Nath are bankrupt. Dipa was first declared bankrupt on the 6^th September 2000. This bankruptcy was discharged on the 6^th December 2003. On the 13^th September 2006 she was declared bankrupt the second time and the Official Receiver has been appointed trustee of her estate. The litigation between the parties relates to the property known as 64 Frobisher Road, London N18 (“the Property”).

The Property was in 1985 registered at HM Land Registry in the joint names of Mira and Nath. On the 12^th September 1994 Nath as a legally aided litigant brought proceedings case number HC 1994 05034 (“the 1994 Action”) in which he sought a declaration that the Property was held by Mira and himself on trust for Nath as absolute beneficial owner. It was on the advice of Dipa’s and Nath’s legal advisers and their joint decision that Nath was the only claimant and that Dipa should not seek to establish any personal or separate interest in the Property. Such a claim by her would have been inconsistent with his claim to be sole beneficial owner. The action came for trial before Ferris J on the 11^th January 2000. Nath’s legal aid certificate was withdrawn or there was a threat of withdrawal. On the 31^st January 2000 his legal representatives withdrew and Ferris J directed that the hearing be resumed not before the 21^st February 2000.

Nath was advised by his legal advisers that unless he settled on the terms available to him he stood the risk of losing everything. Faced with this risk he agreed to settle. He informed Dipa of his intention. Nath thereafter signed a consent order.

On the 21^st February 2000, with both parties represented and agreeing to this course, Ferris J made a consent order which provided that the Property be valued and should be sold and that (less certain deductions) Nath should be entitled to 60% of the net proceeds of sale and that Mira should be entitled to 40%; but the order went on to provide that Mira should be entitled to purchase Nath’s interest for 60% of the figure shown in the valuation.

Subsequently Nath issued two applications. By the first dated the 13^th July 2000 he sought to challenge the valuation made pursuant to the consent order. By the second dated the 11^th March 2002 he sought to set aside the consent order on the ground that his solicitors and counsel had compelled him to sign (indeed blackmailed him into signing) the consent order falsely alleging that his legal aid certificate had been withdrawn. Nath took no steps save one to prosecute either application. On the 5^th July 2006 he obtained on a without notice application an order from Master Nurse: (1) requiring him by the 14^th September 2006 to file and serve a witness statement setting out all facts and matters and exhibiting all documents relied upon in support of his application (I presume the later application to set aside the consent order) and to explain the delay in bringing the application to court; (2) directing that there be further hearing for directions on the 2^nd October 2006. Nath did not comply with the order and the hearing on the 2^nd October 2006 did not take place. Any interest of Nath in the Property must have passed to his trustee in bankruptcy.

On the 8^th April 2002 Dipa made an application to be joined as second claimant in the 1994 Action. In her affidavit in support of the same date she stated that she and Nath provided the purchase price and cost of purchase of the Property and agreed with Mira that they should be the beneficial owners and that Mira could occupy it for seven years. She said that on the advice of their solicitors Nath brought the proceedings representing Dipa and that accordingly it was unnecessary for her to be a co-claimant. Nevertheless she contended that the consent order did not bind her because she was not a party. Her application for joinder was not successful and in its place on the same day she commenced the 2002 Action. Initially Nath was the second claimant in the 2002 Action, but by amendment he was made second defendant. The claim in the 2002 Action is that it was agreed between the parties that Dipa should be sole beneficial owner.

There is an issue between the parties whether the proceedings in the 2002 Action were ever served on Mira. Mira says that they were not. Dipa says that they were served by the documents being put through Mira’s letter box. Whether or not they were served Mira on the 30^th September 2004 made an application to adjourn a Master’s appointment in the 2002 Action on the grounds of ill-health. Responsibly Mira has told me that, whether or not she has been served, she now agrees to the 2002 Action proceeding on the basis that she has now been served. Mira did not serve a defence and has yet to serve a defence in the 2002 Action. In these circumstances Dipa issued an application for summary judgment and Mira gave notice of intention to issue an application for a Civil Restraint Order against Dipa. At a hearing on the 3^rd August 2005 Deputy Master Behrens, after hearing Dipa, Mira and Nath, gave directions; (1) adjourning the application for a 30 minute hearing on the 20^th September 2005; (2) for Dipa to lodge a bundle not later than 7 days before the hearing and serve a copy on “the Defendant”; and (3) for the parties to lodge typed skeleton arguments not later than 2 days before the hearing. He also gave directions in respect of the intended application for a civil restraint order. None of these directions were complied with and no hearing took place.

Meanwhile in pursuance of the provisions of the consent order on the 20^th February 2003 Mira purchased Nath’s interest in the Property paying the purchase price to Nath’s trustee in bankruptcy, and Mira and the trustee executed a transfer transferring the Property to Mira. Mira applied to be registered at HM Land Registry as proprietor, but this was prevented by the registration by Dipa on the 28^th February 2003 of a caution to protect a claimed interest of Dipa in the Property.

On the 24^th November 2004 Mira applied to the Chief Land Registrar to register the transfer and cancel the caution. The Adjudicator was duly appointed. On the 22^nd September 2005 the Adjudicator made a direction under section 118 of the Land Registration Act 2002 requiring Dipa Das before the 24^th October 2005 to commence court proceedings to determine the issue whether Dipa had a beneficial interest in the Property and the extent of it. Dipa applied for an extension of time for compliance and the Adjudicator granted an extension until the 9^th December 2005. On the 8^th December 2005 Dipa applied for a further extension. In neither application and indeed at no time did she make any reference to the 2002 Action. Nor did Mira inform the Adjudicator of the 2002 Action. By the Decision on the 1^st March 2006 the Adjudicator refused this request and held that Dipa had been given more than sufficient time to commence proceedings and it was not proportional to allow her further time and delay further Mira’s registration of her transfer. He accordingly directed that the application for an extension of time be refused and ordered the Chief Land Registrar to register the transfer and cancel the caution. This direction was duly complied with and implemented.

It came to the attention of the Adjudicator when preparing the Reasons for the Decision from a letter supplied by Dipa and alleged by her to have been sent to him on the 24^th February 2006 but which he had not seen before and in respect of which there was no record of receipt, that Dipa had commenced the 2002 Action. The Adjudicator (perhaps surprisingly) took the view that the commencement of proceedings in 2002 (of which he had previously no knowledge) was sufficient to comply with his direction dated the 22^nd September 2005 and whilst it was too late to recall his previous directions for registration of the transfer and cancellation of the caution because they had been implemented, he gave permission to appeal.

Dipa failed to prosecute an appeal against the decision of the Adjudicator within time and applied to Pumfrey J to extend the time for appealing. On the 31^st July 2001 Pumfrey J made an order extending the time to appeal until the 14^th August 2006 (the order must be wrong in stating that the extension was until the 14^th July 2006), directing that the hearing of the appeal be expedited to the first convenient date within 14 days and giving Mira permission to apply within 14 days to set aside or vary this order on 3 days notice to Dipa. Mira made such an application on the 8^th August 2006 on the grounds that: (1) the proceedings in the 2002 Action were never served on her or properly prosecuted; (2) Dipa was at fault in failing to inform the Adjudicator of the 2002 Action; (3) Dipa cannot conceivably have any beneficial interest in the Property since, whilst aware at all times of the proceedings between Nath and Mira and of the making of the consent order, she never informed anyone of her interest or made any claim in respect of it; and (4) the claim by Dipa is all of the same character as the 35 groundless claims which she has made in other proceedings and which have caused Mira to incur costs in respect of which there are undischarged orders for costs in favour of Mira in excess of £15,000.

On the 8^th January 2007 Dipa applied to Pumfrey J for an adjournment of the hearing fixed for the 30^th or 31^st January or 1^st February 2007. The grounds were that she was seeking legal aid and the consent of her trustee in bankruptcy. On the 15^th January 2007 Pumfrey J replied that there should only be an adjournment with the consent of Mira. In response to an inquiry whether she consented by letter dated the 23^rd January 2007 Mira wrote:

“If [the Claimant] has not provided proof that the Official Receiver has been contacted and replied and/or legal aid has been granted the application must proceed.”

The trustee by fax dated the 26^th January 2007 has requested an adjournment on the ground that only recently had the proceedings been brought to his attention. The position regarding legal aid is that, after initially indicating that legal aid would be forthcoming, the Legal Services Commission by letter dated the 26^th July 2006 stated that they were still checking Dipa’s financial circumstances. The Commission do not appear to have fully appreciated, (if they ever were informed of Dipa’s bankruptcy), of the need on her part to obtain the consent of her trustee to pursue the property claim made in the 2002 Action and that her trustee is not free lightly to give his consent: he is under a duty to consider what course is in the best interests of her creditors and achieves the best return. The best return may be a sale of the cause of action to a third party and in particular to Mira who may pay a sum to reflect the nuisance value of the claim even if she considers that the claim is hopeless.

I have not heard any argument on the merits of the appeal. I am only concerned to highlight the issues and give direct appropriate case management directions. The views I express are provisional and not intended to have any binding effect. Any decision on the issues is a matter for the trial judge after hearing full argument from the parties.

The appeal cannot sensibly be disposed of separately from the 2002 Action. The outcome of the 2002 Action should be decisive of the appeal. If Dipa fails in the 2002 Action the Decision must stand and Dipa’s challenge must fail. Likewise if Dipa succeeds in the 2002 Action, the Decision should be set aside. What is critical accordingly is the outcome of the 2002 Action.

In the circumstances I direct that the 2002 Action and all outstanding applications in it and the appeal from the Decision shall be transferred to the Central London CJC for determination. The appeal from the Decision can only be heard by a High Court Judge. This should be no problem, for the appropriate judge at the Central London CJC is Her Honour Judge Marshall QC, a section 9 judge. If such a judge is not available for any reason, the 2002 Action could be heard by another judge and the appeal adjourned to await the outcome. The outcome of the appeal (as I have said) will follow as night follows day the outcome of the 2002 Action and the necessary consequential order on the appeal can be made later by the requisite level judge.

The primary issue in the 2002 Action is whether the doctrine of res judicata or estoppel (as one would perhaps expect) applies to preclude Dipa from challenging today the consent order. That would appear to be a short and relatively straightforward issue of law. It is possible further facts beyond those which I have recited may be relevant. I direct that, if any party wish to raise further facts or adduce further evidence, Central London CJC and the other parties should be notified and the further evidence served on that court and the other parties within 28 days, and I direct that evidence in answer should be served within 14 days thereafter. Mira should serve her Defence within 21 days.

If Mira is to proceed with an application for a Civil Restraint Order, I direct that she ensures that the necessary application has been issued and served and that all available relevant evidence has been served within 21 days of this judgment; and that Dipa should on receipt prepare and serve her evidence in answer within 14 days thereafter.

I further direct that the recital of facts in this judgment should stand as correct for the purposes of the 2002 Action and the appeal unless and until any party identifies to the other parties and the court the findings which that party wishes to challenge and the evidence to be adduced in support of the challenge.

I further direct that a copy of this judgment should be sent immediately to Dipa’s trustee and the Legal Services Commission. In an accompanying letter they should be requested (so far as they practically can) to expedite their decisions and notify the parties and the Central London CJC of their decisions.

I further direct that the parties should notify each other the course of any further application they wish to pursue or order which they wish to seek before the Central London CJC and the evidence in support within 21 days of this judgment.

All parties shall have liberty to apply for further directions to the Central London CJC.

The costs of the appeal (including the costs of the hearing before me) are reserved to the trial judge.