Ford & Anor v Alexander

On 15^th November 2011 I heard a number of applications. The primary application was a review of a decision I made on 5^th July 2011 when I granted the Appellants Mr and Mrs Ford (“the Appellants”) permission to appeal the decision of District Judge Lambert dated 19^th May 2011 sitting in the Central London County Court in Bankruptcy. By that decision the learned District Judge granted the Respondent (“the Trustee”) the right to possession and sale of the Coach House, 2A Turrett Grove, Old Clapham Town, SW4 0EU (“the Property”). She provided for the order to be suspended until 1^st July 2011 and made other ancillary orders in respect of the proceeds of sale.

When I granted permission to appeal on 5^th July 2011 I was not aware of the fact that a Civil Proceedings Order had been made against the Appellants by the Court of Appeal. Equally I was unaware that the day before the Appellants had made an application for a stay before Mann J which he had refused.

When those matters were drawn to my attention I decided it was appropriate to review my decision of 5^th July 2011 and I directed the parties to apply to listings to fix a date with an estimate of half a day with a consensually agreed stay of execution remaining in force until the review was determined.

That was the hearing that was before me which has led to this judgment. It also meant that effectively the review of the decision, the application for permission to appeal if granted and appeal would all be heard at the same time.

At the conclusion of the hearing I indicated that I would refuse the Appellants permission to appeal upon review of my decision on the grounds that their appeal had no prospect of success. I indicated that I would give reasons thereafter. This judgment sets out the reasons.

Subsequent to the hearing Mrs Ford wrote to me on 5^th December 2011 raising matters which were not canvassed in the hearing. I have taken those into account. The Trustee did not wish to make any observations. I do not believe that anything in that correspondence assists the Appellants in their appeal.

The background to this case is substantially set out in the judgment of the learned District Judge below and I need to advert to it only briefly.

On 12^th October 2007 Bankruptcy Orders were made against the Appellants. The petitions related to a unpaid costs order made by Ouseley J on 24^th September 2004 in proceedings between the London Borough of Lambeth and Mr and Mrs Ford. The Official Receiver became Trustee of Mr Ford’s estate on 20^th November 2007 and the Trustee of Mrs Ford’s estate on 26^th November 2007.

The Trustee was appointed Trustee of the estates of Mr and Mrs Ford on 26^th April 2010. He notified them on 12^th May 2010 of his intention to seek an order of possession of the property pursuant to rule 6.237 of the Insolvency Rules 1986 as amended by section 283 A of the Insolvency Act 1986 (“IA 1986”). He invited them to make an offer to him within 14 days for his interest in the property. No offer was received and they have confirmed that they are not in a position to make any offer. The present proceedings were commenced on 16^th July 2010 and heard by the District Judge on 15^th April 2011. Her judgment as I have said was delivered on 19^th May 2011.

The issue relates to the Property and whether or not the Respondent as Trustee ought to have possession in order to sell it to provide a return to the Creditors in the estate of the two bankrupts.

The Property is somewhat unusual. It comprises a garage/outbuilding that was converted without planning permission into a studio flat. The Appellants occupy this building as their only home. It has been in Mr Ford’s ownership since 1981although he was not in continuous occupation until 2003 when the Appellants started to live in the Property together. There are no charges on the Property and the Appellants are the only people in occupation.

On 26^th January 2011 the Planning Inspector made a decision allowing an appeal by the Appellants against the refusal to grant planning permission and granted retrospective planning permission for the use of the existing building as a dwelling at the Property subject to conditions. The relevant condition is that the dwelling should be occupied only by the Appellants and when the building ceases to be occupied by at least one of those as their main residence the use as a dwelling shall cease.

All property owned beneficially by a bankrupt vests in the Official Receiver and then in any subsequent Trustee when appointed. The duty of the person so appointed is so far as possible to realise the assets for the benefit of the creditors and for paying the costs of the bankruptcy and the Official Receiver. There have been a number of specific provisions addressing the principal dwelling of a bankrupt. The latest is section 283A IA 1986 which was inserted by the Enterprise Act 2002 (section 261 (1)). The relevant section provides as follows:-

“283A Bankrupt’s home ceasing to form part of estate

(1)This section applies where property comprised in the bankrupt’s estate consists of an interest in a dwelling-house which at the date of the bankruptcy was the sole or principal residence of—

(a)the bankrupt,

(b)the bankrupt’s spouse [or civil partner], or

(c)a former spouse [or former civil partner] of the bankrupt.

(2)At the end of the period of three years beginning with the date of the bankruptcy the interest mentioned in subsection (1) shall—

(a)cease to be comprised in the bankrupt’s estate, and

(b)vest in the bankrupt (without conveyance, assignment or transfer).

(3)Subsection (2) shall not apply if during the period mentioned in that subsection—

(a)the trustee realises the interest mentioned in subsection (1),

(b)the trustee applies for an order for sale in respect of the dwelling-house,

(c)the trustee applies for an order for possession of the dwelling-house,

(d)the trustee applies for an order under section 313 in Chapter IV in respect of that interest, or

(e)the trustee and the bankrupt agree that the bankrupt shall incur a specified liability to his estate (with or without the addition of interest from the date of the agreement) in consideration of which the interest mentioned in subsection (1) shall cease to form part of the estate.

(4)Where an application of a kind described in subsection (3)(b) to (d) is made during the period mentioned in subsection (2) and is dismissed, unless the court orders otherwise the interest to which the application relates shall on the dismissal of the application—

(a)cease to be comprised in the bankrupt’s estate, and

(b)vest in the bankrupt (without conveyance, assignment or transfer).

(5)If the bankrupt does not inform the trustee or the official receiver of his interest in a property before the end of the period of three months beginning with the date of the bankruptcy, the period of three years mentioned in subsection (2)—

(a)shall not begin with the date of the bankruptcy, but

(b)shall begin with the date on which the trustee or official receiver becomes aware of the bankrupt’s interest.

(6)The court may substitute for the period of three years mentioned in subsection (2) a longer period—

(a)in prescribed circumstances, and

(b)in such other circumstances as the court thinks appropriate.

(7)The rules may make provision for this section to have effect with the substitution of a shorter period for the period of three years mentioned in subsection (2) in specified circumstances (which may be described by reference to action to be taken by a trustee in bankruptcy).

(8)The rules may also, in particular, make provision—

(a)requiring or enabling the trustee of a bankrupt’s estate to give notice that this section applies or does not apply;

(b)about the effect of a notice under paragraph (a);

(c)requiring the trustee of a bankrupt’s estate to make an application to the Chief Land Registrar.

(9)Rules under subsection (8)(b) may, in particular—

(a)disapply this section;

(b)enable a court to disapply this section;

(c)make provision in consequence of a disapplication of this section;

(d)enable a court to make provision in consequence of a disapplication of this section;

(e)make provision (which may include provision conferring jurisdiction on a court or tribunal) about compensation.]”

The essence of this statutory provision was to give a Trustee 3 years to realise the property in question. If he has not attempted to realise at the end of that period the property revests in the bankrupt without any conveyance, assignment or transfer.

In this case the notification was given on 12^th May 2010 which is within the 3 year period.

The Appellants are registered as joint proprietors of the Property with title absolute under title number TGL203329. As they held the Property upon trust for themselves the legal title would not vest in their trustees and they would remain trustees to give effect to the beneficial interest which would have vested in the Trustee. That means that the Trustee would have to make an application (which is in effect what he has done) to realise the beneficial interest under the trusts of the Property. Provision is made for such application to be made in the bankruptcy court (as it always was made) under section 335A IA 1986. That section provides as follows:-

“335A Rights under trusts of land.

(1)Any application by a trustee of a bankrupt’s estate under section 14 of the Trusts of Land and Appointment of Trustees Act 1996 (powers of court in relation to trusts of land) for an order under that section for the sale of land shall be made to the court having jurisdiction in relation to the bankruptcy.

(2)On such an application the court shall make such order as it thinks just and reasonable having regard to—

(a)the interests of the bankrupt’s creditors;

(b)where the application is made in respect of land which includes a dwelling house which is or has been the home of the bankrupt or the [F3bankrupt’s spouse or civil partner or former spouse or former civil partner]—

(i)the conduct of the [F4spouse, civil partner, former spouse or former civil partner], so far as contributing to the bankruptcy,

(ii)the needs and financial resources of the [F4spouse, civil partner, former spouse or former civil partner], and

(iii)the needs of any children; and

(c)all the circumstances of the case other than the needs of the bankrupt.

(3)Where such an application is made after the end of the period of one year beginning with the first vesting under Chapter IV of this Part of the bankrupt’s estate in a trustee, the court shall assume, unless the circumstances of the case are exceptional, that the interests of the bankrupt’s creditors outweigh all other considerations.

(4)The powers conferred on the court by this section are exercisable on an application whether it is made before or after the commencement of this section.]”

The hearing before me centred almost exclusively on the impact of that section on the Trustee’s application. As the section shows in effect the bankrupts are permitted if no action is taken by the Trustee to remain in possession of the Property for one year. Thereafter under sub section (3) it is provided that after that year the court shall unless the circumstances of the case are exceptional assume that the interest of the bankrupts’ creditors outweighs all other consideration.

There was an issue as to the value of the property especially in the light of the limited planning permission. On 11^th January 2011 Deputy Registrar Jones gave all parties permission to file expert evidence as to the value of the Property both with and without planning permission. The Appellants never filed any expert evidence as to the value. The Trustee had a letter from Hamptons recommending an asking price of £40,000 for this property and a second valuation from a local agent Duck & Hedges for the same amount. He had also received a written offer to purchase the property at that price from Gregory Besterman of Nightingale Square Properties, a neighbouring land owner. It appears that the acquisition of the property might be beneficial to the development of the adjoining property. Finally, shortly before the hearing before the District Judge the Trustee provided a short valuation from Messrs Currell dated 13^th April 2010 estimating the value of the property at £40,000. The Appellants challenged that valuation and said that it was an undervalue. They produced no evidence however beyond a letter dated 11^th April 2011 from Messrs Foxtons recommending an asking price of £55,000. The Trustee confirmed he would seek to sell the property for that price although he would have to be realistic and accept the best price available.

There was some dispute about the creditors with the total figure according to the Trustee being some £262,171.08. There was an issue about whether or not there were any other assets, in particular a sum of £6,550 which was supposedly paid into Wandsworth County Court but the Trustee investigated with the court and was unable to find any evidence showing such a payment in.

The creditors’ sums are therefore significant and the sale of the Property represents the only likely method of the creditors having some return. The Trustee’s costs were approximately £15,000. If the Property achieved a sale price of £55,000 there will be a net figure of £40,000 for the creditors. If they were in at about £262,000 that would produce a dividend in very approximate terms of 20 pence in the pound.

The counter argument for the Appellants is that the property should never be sold. They should remain there indefinitely and the creditors receive nothing.

The Appellants relied on matters set out in their witness statements in support of their claim that it would be disproportionate to order a sale of their home in comparison to the benefit of the sale to the creditors. There was reference to the medical conditions that they suffered and the fact that they would lose their only home. It was said to be doubtful that they would be accepted as homeless and would not meet the definition of priority as they are childless and clearly not vulnerable. They would also have difficulty finding private rental accommodation due to their need to house their fish and terrapins, particularly a property in the area in which they currently live. Although the Trustee did not challenge any of this evidence, in my view it was seriously undermined by the fact that the Appellants had made no attempts to find any alternative property to see whether their fears were justified.

First she reviewed the law in this area comprehensively. When it came to applying section 335 IA 1986 she had mind to the impact of section 3 Human Rights Act 1998 (“HRA”) and Article 8 of the Convention for Protection of Human Rights and Fundamental Freedoms 1950 (“Convention”). The former provides that in so far as it is possible to do so primary legislation must be read and given effect in a way which is compatible with the Appellants’ convention rights i.e. the operation in this case of section 335 A. The latter affirms that everyone has a right to respect for his private and family life his home and his correspondence (Article 8 (1)). However there is a limit as sub paragraph (2) which specifies:-

“(2)

there should be no interference by a public authority in the exercise of this right, except such as in accordance with the law and is necessary in a democratic society in the interests of national security, public safety or the economic wellbeing of a country, for the prevention of disorder or crime for the protection of health or morals, or for the protection of rights and freedom of others.”

The Deputy Judge rightly expressed the view (paragraph 16) that there has to be a balancing exercise between the individual’s rights where, there is some interference with that right and where the rights and freedoms of others might be affected.

She then reviewed a series of cases involving applications for sale of a bankrupt’s home where Article 8 was considered and it was found in all those cases that the legislation in section 335 A IA 1986 was not incompatible with Article 8 (see for example Foyle v Turner [2007] BPIR 43 and Turner v Avis [2008] BPIR 1143).

In Foyle His Honour Judge Norris QC (as he then was) considered the impact of Article 8 and applying Kay v London Borough of Lambeth [2006] UKHL 10; [2006] 2 AC 465 concluded that, where a statutory regime confers on the court jurisdiction to make an order for possession, if the court thinks it is reasonable then the exercise of that jurisdiction will require the court to undertake the very assessment which Article 8 requires to be undertaken. The learned Judge then (paragraph 17) expressed the view that the same principles apply to section 335 A IA 1986 and that provided the provisions of that section were faithfully followed and applied there was no need to enter into any separate consideration of Article 8 rights. The priority determined by Parliament as between creditors and bankrupts’ family (after the initial period of 1 year) is that save in “exceptional circumstances” the interests of the creditors are to prevail.

In Turner His Honour Judge Pelling QC applied Foyle and also went on to consider “exceptional circumstances”. I will return to that further in this judgment.

The District Judge then reviewed what were exceptional circumstances and applied Harrington v Bennett [2000] BPIR 630 at 663 and expanded in Dean v Stout [2005] BPIR 113 (paragraph 19). She determined that:-

She then followed the observations of Paul Morgan QC (as he then was) in Hosking v Michaelidis [2006] BPIR 1192 and Judge Pelling in Turner above. She also observed that in an application like the present for an order for sale the court is considering the rights of the parties under trusts of land and that the bankruptcy state (by that she meant the beneficial interests) is vested in the Trustee in bankruptcy. The purpose of the sale by the Trustee is in order to realise the beneficial interest vested in the Trustee and he expressed the view that was a legitimate aim which answers a pressing social need as in most cases this would be justified on the basis it is necessary to protect the rights of others, namely creditors.

She rejected the submission that the exercise of the rights under section 335 A was disproportionate and cases cited to her namely Zehentner v Austria [2009] and Manchester City Council v Pinnock [2010] UKSC 45 did not require her to operate a different exercise from the wording of the section. She also concluded that those decisions did not require her to adopt a different approach from that taken by the courts in Re Citro and Harrington v Bennett and Dean v Stout referred to above.

She therefore concluded that she approached the matter in accordance with the section as set out in the previous authorities summarised in this judgment above.

Having directed herself to the correct application of the law she then reviewed the evidence of value and other assets. She considered the matters put forward by the Appellants as to disproportionality and the difficulties they would have in finding alternative accommodation and considered those in her judgment (paragraph 55 et seq). She balanced the position of the creditors and their desire to obtain something out of the bankruptcy, which they would not unless the Property was sold, against the medical evidence showing that the Appellants were suffering from moderate depression and moderate to severe depression being brought about by the worry associated with the consequences of losing their home. It was submitted on behalf of the Trustee that these were not exceptional circumstances but merely “melancholy consequences of debt and improvidence”. She also observed that whilst there might be difficulties about alternative accommodation there were other possibilities which had not been fully investigated by the Appellants. That remained the position before me and she observed (paragraph 60) that they did not seek a suspension of the order for possession but an indefinite suspension.

She rejected that the evidence of the Appellants showed any exceptional circumstances justifying a rejection of the Trustee’s claim (paragraph 78). She set her reasons out in full in paragraph 79. She rejected the medical condition and the ages of the Appellants as being exceptional circumstances (paragraph 81) and she determined that the interest for the creditors required a sale (paragraph 83). This led her to an overall conclusion that there were no exceptional circumstances and that even if all the circumstances put forward by the Appellants were considered collectively she did not consider they were exceptional and were nothing more than the sad consequences of debt and improvidence. There is no challenge to these findings. Nor could there be in my view.

Finally she dealt with the position if she was wrong on the alternative argument put forward by the Appellants in that section 335 A needs to be modified to apply a proportionality test for the order for sale. If that were the correct test then she concluded that it would not be disproportionate to order a sale on the facts of the case.

She therefore granted the application but suspended its operation for 6 weeks.

Ground 1 is that the District Judge failed to read and apply section 335 A in compliance with section 3 and 6 of HRA 1998. Ground 2 is that she failed to find that “unless the circumstances of the case were exceptional” should be read as if for “exceptional” was inserted “such that it would be disproportionate to do so” or otherwise “exceptional” should be read and applied subject to the proportionality principle. Third it is complained that she failed to find their circumstances exceptional in that sense in the Appellants’ case so that the Trustee’s application should be dismissed. Finally it is complained that in so far as she did purport to apply the proportionality principle she failed to do. It is suggested she wrongly took the view that applying that principle would mean the Trustee would never be able to realise the interest in a bankrupt’s home and she failed to balance the serious harm caused by making the order to the Appellants against a slight potential gain to the creditors.

The fundamental difficulty with the Appellants’ case is that in my view the grounds of appeal are based on a misunderstanding of paragraph 90 of the District Judge’s judgment. She plainly reconsidered all the facts of the case as if the law of proportionality as contended for by the Appellants was applicable to the case. Applying that test she came to the same conclusion.

There is no challenge in reality to the factual findings of the District Judge. If the law is as established by the line of authorities that I have referred to above she considered all the facts and applied that law and came to a conclusion that the Trustee on behalf of the creditors ought to prevail. I can see no grounds as the Appellate Court in interfering with that conclusion. None is given. Nor could there be because the District Judge’s review is comprehensive and total in my view.

That then leads to the possibility that she has mis-applied the law by rejecting the primary argument of the Appellants that the proportionality test required by Article 8 should be read in to section 335 A. It is correct as I have said that she has rejected that submission. Nevertheless paragraph 90 of her judgment makes it quite clear that she comes to apply that test on a reconsideration of facts and comes to the same conclusion. I do not accept the criticism of her observation that in a case of this kind if an order for sale cannot be made on the ground of proportionality a Trustee would never be able to realise his interest in the bankrupt’s home for the benefit of the creditors to meet their debts. She seems to be saying in my view nothing more than the logical conclusion of the Appellants’ submissions. She cannot conceive of any circumstances on the facts before her where it would be proportionate in effect to look at the creditors’ prospects (which she did), look at the circumstances of the Appellants (and in particular the unexceptional nature of their circumstances), look at what the Appellants were seeking (namely a permanent suspension) and thus conclude that it was proportionate permanently to deprive the creditors of any prospect of ever having any realisation out of the bankruptcy. Instead the conclusion that the Appellants contend for would be that they should be allowed to stay in the Property that no longer belongs to them forever. I agree with her analysis but it must be appreciated that that analysis and the conclusion is in the context of the facts of the case. There may be a circumstance where it is proportionate permanently to deprive a Trustee but that is not the position in the present case.

I can see no basis for criticising this part of her judgment. That means that even if the law as contended for by the Appellants the District Judge has come to the conclusion which in my view is impeccable and has no basis for challenge whatsoever.

Although it is strictly unnecessary for me to do so by reason of my analysis of the judgment below I think it is appropriate to express a view on the submissions made by the Appellants based on the Pinnock case.

All of the bankruptcy cases which considered Article 8 pre date the Pinnock decision. Nor were the Trustee in bankruptcy cases considered in Pinnock.

The case involved public sector lettings and the landlord seeking possession was a local authority. There was therefore clearly a public authority which was purportedly interfering with the tenants’ Article 8 rights. The question is the extent to which Article 8 applies (if at all) where the person seeking possession is not a public authority.

The Appellants’ arguments start unpromisingly in my view when one looks at Lord Neuburger’s judgment in Pinnock. In paragraph 4 he said:-

“on the other hand we should emphasise at the outset that nothing in this judgment is intended to bear on cases where the person seeking the order for possession is a private owner. We briefly explain why at paragraph 50 below.”

Paragraph 50 stated as follows:-

“We emphasise that this conclusion relates to possession proceedings brought by local authorities. As we pointed out at para 4 above, nothing which we say is intended to bear on cases where the person seeking the order for possession is a private landowner. Conflicting views have been expressed both domestically and in Strasbourg on that situation. In Harrow v Qazi [2004] 1 AC 983 the views of Lord Bingham and Lord Steyn, at paras 23 and 26, can be contrasted with the view of Lord Hope, at para 52. In Belchikova v Russia (App no 2408/06, 25 March 2010), the application was held to be inadmissible, but the EurCtHR (First Section seems to have considered that article 8 was relevant, even when the person seeking possession was a private sector landowner. Presumably, this was on the basis that the court making the order was itself a public authority. But it is not clear whether the point was in contention. In the rather older admissibility decision of Di Palma v United Kingdom (App no 11949/86) (1986) 10 EHRR 149, 1550156, the Commission seems to have taken a different view, but the point was only very briefly discussed. No doubt, in such cases article 1 of the First Protocol to the Convention will have a part to play, but it is preferable for this Court to express no view on the issue until it arises and has to be determined.”

Given that it seems to me that the Pinnock case provides no assistance to the Appellants.

Faced with that Mr Watkinson, who appears for the Appellants referred me to the Austrian case of Zehentner v Austria (app no 20082/02 16 July 2009) where the ECHR first section considered the effects of Article 8 in the context of an order evicting the Applicant from her home following a judicial sale after the making of the Austrian equivalent of a charging order. The decision was referred to in Pinnock not on the point under consideration, namely whether the enforcement procedures by courts is sufficient to attract Article 8 and there was no analysis of that decision in this context.

The Zehentner decision said this on the question of Article 8 applying to the proceedings:-

“2.

The Court's assessment

1.

The Court has noted on a number of occasions that whether or not a particular habitation constitutes a “home” which attracts the protection of Article 8 § 1 will depend on the factual circumstances (see, for instance, Buckley v. the United Kingdom, judgment of 25 September 1996, Reports 1996-IV, §§ 52-54 and, as a recent authority, McCann v. the United Kingdom, no. 19009/04, § 46, 13 May 2008).

2.

The Court observes that the apartment subject to judicial sale was situated at S.-street 17/3 in Vienna. It appears that the courts considered it to be the applicant's residence, as it was at that address that the decision authorising the judicial sale and the summons informing the applicant of the date of the auction were served in June and October 1999, respectively. Moreover, it is not in dispute that following the judicial sale which took place in November 1999 the applicant was evicted from the apartment, in February 2000. Consequently, the Court sees no reason to doubt that the apartment subject to the judicial sale was at the material time the applicant's “home” within the meaning of Article 8 of the Convention.

3.

The Court considers that the judicial sale of the applicant's apartment and her eviction interfered with her right to respect for her home. In contrast to the Government's view, the Court finds that the judicial sale and the applicant's eviction are to be seen as a whole. The judicial sale deprived her legally of her home, and was a necessary pre-condition for the eviction, which factually deprived her of her home.

4.

The interference at issue will be in violation of Article 8 unless it is justified under the second paragraph of that provision. In the present case the interference was in accordance with the law, being based on the relevant provisions of the Enforcement Act, and served the legitimate aim of protecting the rights and freedoms of others: the proceedings as a whole served the interests of the creditors to obtain payment of their claims. In addition, the eviction and the refusal to annul the judicial sale served to protect the purchaser of the apartment.

5.

The Court reiterates that an interference will be considered “necessary in a democratic society” for a legitimate aim if it answers a “pressing social need” and, in particular, if it is proportionate to the legitimate aim pursued. While it is for the national authorities to make the initial assessment of necessity, the final evaluation as to whether the reasons cited for the interference are relevant and sufficient remains subject to review by the Court for conformity with the requirements of the Convention (see Connors v. the United Kingdom, no. 66746/01, § 81, 27 May 2004, and Buckley, cited above, § 74).

6.

In this regard, a margin of appreciation must, inevitably, be left to the national authorities, who by reason of their direct and continuous contact with the vital forces of their countries are in principle better placed than an international court to evaluate local needs and conditions. This margin will vary according to the nature of the Convention right in issue, its importance for the individual and the nature of the activities restricted, as well as the nature of the aim pursued by the restrictions. The margin will tend to be narrower where the right at stake is crucial to the individual's effective enjoyment of intimate or key rights. Where general social and economic policy considerations have arisen in the context of Article 8, the scope of the margin of appreciation depends on the context of the case, with particular significance attaching to the extent of the intrusion into the personal sphere of the applicant (see Connors, cited above, § 82 with further references).

7.

The procedural safeguards available to the individual will be especially material in determining whether the respondent State has, when fixing the regulatory framework, remained within its margin of appreciation. In particular, the Court must examine whether the decision-making process leading to measures of interference was fair and such as to afford due respect to the interests safeguarded to the individual by Article 8 (see Connors, cited above, §83, and Buckley, cited above, § 76).

8.

In this context the Court has already held that the loss of one's home is a most extreme form of interference with the right to respect for the home. Any person at risk of an interference of this magnitude should in principle be able to have the proportionality of the measure determined by an independent tribunal in the light of the relevant principles under Article 8 of the Convention (see McCann, cited above, § 50, 13 May 2008).

9.

The Court recalls that in proceedings originating in an individual application it has to confine itself, as far as possible, to an examination of the concrete case before it (see J.B. v. Switzerland, no. 31827/96, § 63, ECHR 2001-III). It is therefore not called upon to review the legislation at issue in the abstract, namely the relevant provisions of the Enforcement Act on the judicial sale of property, but will examine the specific circumstances of the applicant's case. Having regard to the crucial nature of the interference with the applicant's right to respect for her home, the Court attaches particular weight to the procedural safeguards.

10.

The Court notes at the outset that the judicial sale of the applicant's apartment was authorised on the basis of a payment order which had been issued in summary proceedings. While this may be in the interest of efficient enforcement proceedings, the Court has doubts as to whether the debtor's interests are adequately taken into account where such a payment order, moreover for a comparatively minor sum, can be the basis for the judicial sale of a debtor's “home” within the meaning of Article 8. While the Court does not have to examine this system in the abstract, it notes that in the circumstances of the present case it was particularly detrimental to the applicant. It appears from the expert opinion provided in the guardianship proceedings that by the time the judicial sale of her apartment took place she had lacked legal capacity for years. As a result she had not been in a position either to object to the payment order underlying the decision authorising the judicial sale or to make use of the remedies available to the debtor under the Enforcement Act (see paragraph 28 above).

11.

It is true, as the Government pointed out, that the courts were not and could not have been aware of the applicant's lack of legal capacity when conducting the proceedings at issue. However, the Court attaches weight to the fact that once the applicant's lack of legal capacity had been established and a guardian had been appointed for her, she was left without any means of obtaining a review of her case due to the absolute nature of the time-limit for appealing against a judicial sale laid down in section 187 § 1 of the Enforcement Act.

12.

The Court notes the Supreme Court's and the Government's arguments that the said time-limit served to protect the bona fide purchaser and the general interests of an efficient administration of justice and of preserving legal certainty. Nevertheless, persons who lack legal capacity are particularly vulnerable and States may thus have a positive obligation under Article 8 to provide them with specific protection by the law (see, mutatis mutandis, Connors, cited above § 84). While generally there may be good reasons for having an absolute time-limit for lodging an appeal against a judicial sale of real estate, specific justification would be required where a person lacking legal capacity is concerned. The Court notes that the Supreme Court has not given any such justification and has not carried out any weighing of the conflicting interests at stake, namely the interests of the bona fide purchaser on the one hand and the debtor lacking legal capacity on the other hand.

13.

Turning to the Government's argument that the absolute time-limit served the general interest of preserving legal certainty, the Court reiterates its established case-law in the context of Article 6 § 1. It has repeatedly stated that one of the fundamental aspects of the rule of law is the principle of legal certainty, which requires, among other things, that where the courts have finally determined an issue their ruling should not be called into question (see, among many others, Brumărescu v. Romania, judgment of 28 October 1999, Reports 1999-VII, § 61). Nevertheless, the Court has held that departures from that principle may be justified when made necessary by circumstances of a substantial and compelling character (see Ryabykh v. Russia, no. 52854/99, § 52, ECHR 2003-IX). The Court has not considered Article 6 § 1 to have been violated where the quashing of a final and enforceable decision was aimed at correcting a fundamental defect (see, for instance, Protsenko v. Russia, no. 13151/04, §§ 30-34, 31 July 2008).

14.

In the present case, neither the protection of the bona fide purchaser nor the general interest of preserving legal certainty are sufficient to outweigh the consideration that the applicant, who lacked legal capacity, was dispossessed of her home without being able to participate effectively in the proceedings and without having any possibility to have the proportionality of the measure determined by the courts. It follows that, because of the lack of procedural safeguards, there has been a violation of Article 8 of the Convention in the instant case.

It is clear that the circumstances of the case were extremely unusual. However in the context of section 335 A in my view the requirements in sub section (2) and the change of emphasis in sub paragraph (3) do not infringe Article 8 (2). They provide a necessary balance as between the rights of creditors and the respect for privacy and the home of the debtor. That balance serves the legitimate aim of protecting the rights and freedoms of others. I am therefore of the opinion that the requirements of section 335 A satisfy the test of being necessary in a democratic society and are thus proportionate (see McCann v United Kingdom (App no 19009/04) and Connors v United Kingdom (App no 66746/01)). This was the conclusion in the pre Pinnock bankruptcy cases and I see no basis for coming to a different conclusion.

For the same reasons I do not see that the decision of the Supreme Court in Mayor and Burgess of London Borough of Hounslow v Powell & Ors [2011] UKSC 8 offers any assistance. The checks and balances set out in section 335 A in my view suggest a procedure that is proportionate and Article 8 adds nothing.

In my view therefore given the requirements that are set out in section 335 A the court procedure does not infringe Article 8.

I stress however that that is not necessary for the purpose of this appeal because the District Judge in paragraph 90 of her judgment considered and applied that test in the alternative.

I referred earlier in my judgment to correspondence received from Mrs Ford after the hearing. I do not consider any of the matters raised by that correspondence has any relevance to the case before me. The issues were fully argued both orally and in writing.

I will therefore conclude that on a further reconsideration in the hearing the Appellants’ appeal has no prospect of success. Accordingly I revoke my decision to grant the Appellants permission to appeal on 5^th July 2011. In effect the hearing before me is an oral hearing in any event on the application for permission to appeal. I therefore determine any appeal has no prospect of success.

At the end of the hearing I adverted to section 89 of Housing Act 1980 which restricts in most possession proceedings the ability of the court to suspend an order for possession. It limits it to 14 days or 6 weeks in the case of exceptional hardship. The debate between counsel and myself was to the effect that that provision applied (to the present possession proceedings). It was accepted further that as the Appellants had had more than 6 weeks without actually establishing exceptional hardship there can be no prospect of invoking that provision. I raised with the Appellants whether or not they would be willing to give undertakings to the Trustee to vacate the property when he had a buyer (a common practice in bankruptcy cases) and other undertakings of a similar nature but they refused to give any such undertakings.

I have now considered the Pinnock case and the Powell case. The section was raised in both of them (Pinnock paragraph 63 and Powell paragraphs 67 et seq). However in both cases the question of whether or not Article 8 could be relied upon to extend the 6 week period was not argued. I am conscious that that matter has not been argued before me and I invite the parties to provide submissions for my consideration when I hand down this judgment as to the applicability of Article 8 to the provision.