Kehinde Aotunde Odukoya & Anor v Topaz Finance Limited t/a Malanite Mortgages

On 23 February 2023, I made an extended civil restraint order against the First Claimant, Mr Kehinde Odukoya. I also granted a retrospective extension of time for the making of the application for that order. This judgment contains my reasons for doing so.

Mr Odukoya has at all material times been the owner of a long lease of flat 3, 57 Christchurch Hill, London NW3 1JJ. As I understand it, until recently it was his home where he lived with his family. The Second Claimant, Ms Olufemi Abiola Popoola is, as I understand it, his wife.

The facts I set out below are taken from the second witness statement of Jordan Elliott Smithers, for the Defendant (“Topaz Finance”) made on 9 February 2023, which have not been materially contradicted by any evidence given by Mr Odukoya.

On 28 March 2007, Mr Odukoya granted a legal charge over the flat to Beacon Homeloans International (“Beacon”). He fell into arrears, and by order in the Central London County Court on 22 August 2012, District Judge Silverman granted Beacon possession of the property, suspended as long as Mr Odukoya paid the continuing mortgage instalments, and in addition paid off the arrears, which by then were £3,665, at £125 a month.

Unfortunately, Mr Odukoya breached the terms of the suspended order, and so on 18 January 2018 Beacon requested from the County Court a warrant of possession. This prompted Mr Odukoya, supported by an organisation called “Mortgages Five Zero” (MFZ”), to apply to set aside the order, but his application was dismissed by His Honour Judge Luba Q.C. on 14 June 2018 upon his indicating to the court that he did not wish to proceed with it. By the same order, Topaz Finance was substituted for Beacon as claimant to the County Court claim, as in the meantime it had taken an assignment of the legal charge on 11 May 2018.

On 16 July 2018, District Judge Brooks gave Topaz Finance permission to enforce the suspended order (permission was needed as more than six years had passed since the making of it), but for the next two and a half years thereafter Mr Odukoya managed to frustrate enforcement in the County Court by a series of applications to that court, all of which were dismissed. Thus:

By order made on the same day, 9 September 2022, District Judge Avent granted Topaz Finance’s application (made on 27 June 2022) to transfer the County Court proceedings to the High Court for the purposes of enforcement only. On 24 November 2022, His Honour Judge Luba Q.C. struck out Mr Odukoya’s appeal against this order, again because it had been filed without permission, contrary to the limited civil restraint order, and without an explanation for this. He added, for the avoidance of doubt, that there was no stay of the order or of any order for possession or execution thereof.

On 29 November 2022, Topaz Finance, having obtained a writ of possession from the High Court on 9 November 2022, executed it, took possession of the property and evicted Mr Odukoya and his family. On the same day, Mr Odukoya attended the County Court to seek a suspension or stay of execution, but His Honour Judge Saggerson refused the application.

However, Mr Odukoya on 30 November 2022 applied to consolidate his High Court claim (although it had been struck out) with the County Court proceedings, and on 2 December 2022 he re-entered the property, as he accepted before me at the hearing on 7 February 2023. However, on 8 December 2022 Topaz Finance obtained a writ of restitution, which it executed on 16 December 2022, thereby again evicting Mr Odukoya and his family.

In response, Mr Odukoya on 20 December 2022 made an application to transfer proceedings to the High Court, and on 23 December 2022 he applied in the High Court for an injunction to restore possession to him, again on the basis that the charge was void under s.2(3) of the 1989 Act, but this latter application was dismissed on paper by Mrs Justice Smith on 3 January 2023.

As she had done in April 2022 in relation to the application to appeal against Deputy Master Hansen’s order in February 2022, Mrs Justice Smith certified this further application as being “totally without merit”. In her reasons she repeated that s.2 of the 1989 Act was concerned not with actual transfers of an interest in land, such as legal charges, but with contracts for the creation of the same. She also noted that on 5 December 2022, Deputy Master Rhys had sent out an email giving directions, which noted that the claim (i.e. the High Court claim) had been struck out, dismissed and certified as “totally without merit. In the circumstances the application made on 1^st December 2022 cannot be entertained”. (Whether this application was the one issued on 30 November 2022 is not clear, but nothing turns on the point.)

She went on to note that she was required by CPR rule 52.20(6)(b) to consider whether to make a civil restraint order, but decided on balance not to do so, primarily because there appeared to be a hearing already listed in the matter for 6 February 2023. But she concluded:

“However, if the Applicant [Mr Odukoya] seeks to resurrect this application for interim relief he should be aware that there is a strong chance that the court will consider it appropriate to make a Civil Restraint Order.”

On the same day, that is 3 January 2023, Mr Odukoya applied to set aside Mrs Justice Smith’s order, and he sought to reinstate the injunction application. This application was listed to be heard by me on 7 February 2023, along with Mr Odukoya’s still outstanding application issued on 30 November 2022 to consolidate the High Court and the County Court claims.

At that hearing, Mr Odukoya attended in person, and presented his case with courtesy and moderation. It was clear to me that he felt strongly that the law had been misunderstood, and that his arguments on s.2(3) of the 1989 Act were correct. However, there was no basis for an injunction, as it was not open to Mr Odukoya to re-run these arguments which had already been decided against him, and further, it was clear that the High Court proceedings had been struck out (so there was nothing to consolidate with the County Court proceedings). Accordingly, I dismissed both applications as being “totally without merit”.

At that hearing, Mr Tipler, who appeared for Topaz Finance, asked me to make an extended civil restraint order, as envisaged by Mrs Justice Smith in her reasons for her order made on 3 January 2023. However, I decided not to do so on that occasion, because CPR rule 3.11, as supplemented by paragraph 5.1 of Practice Direction 3C, provides that an application for a civil restraint order “must be made using the Part 23 procedure unless the court otherwise directs”, but no application notice had been issued, and Mr Tipler’s skeleton for that occasion, which sought the order, had not been served three clear days before the hearing, as required for an application, if it could be treated as such, by the CPR rule 23.7(1)(b). I should add that Mr Tipler did not invite me to exercise the power under CPR rule 52.20(6)(b), which would appear to apply only to orders made on the dismissal of an appeal.

Accordingly, I indicated that a further hearing should take place before me as soon as possible to consider the making of an extended civil restraint order, and with the consent of the parties it was agreed that this should take place on Wednesday 22 February 2023 at 10 am. I ordered Topaz Finance to file and serve on Mr Odukoya a formal application with supporting evidence by 4 pm on Thursday 9 February 2023 (allowing for service by email), and I ordered that that if the date was not convenient to Mr Odukoya he was to provide written reasons by email to my clerk by 10 am on 13 February 2023. I also provided for him to serve evidence in reply to the application by no later than 4 pm on Tuesday 21 February 2023

Topaz Finance issued its application notice with supporting evidence on 9 February 2023, but, as I was informed by Mr Tipler at the hearing on 22 February 2023, it was by oversight not served on Mr Odukoya until Monday 13 February 2023. (I accept that it was served on that morning, as appeared from an email chain produced to me at the 22 February hearing.) Mr Odukoya did not, however, write to my clerk on that day or subsequently, to object that for this reason the hearing date was inconvenient to him, nor did he serve any evidence in reply. Nor was he present when the hearing was due to begin at 10 am on 22 February, nor (as Mr Tipler then informed me) did he send any message to Topaz Finance’s solicitors to say that he was delayed. Nor, so far as I am aware, was any such message sent to the Court. Nonetheless, I waited until 11 am to start the hearing, by when he had still not appeared or sent any such message. I accordingly went ahead with the hearing in his absence, at which Mr Tipler orally sought a retrospective extension of time, and set out his arguments for the making of an extended civil restraint order.

Despite his non-attendance, Mr Odukoya did provide to Topaz Finance’s solicitors a skeleton argument dated 21 February 2023, which sought an adjournment of the hearing on two grounds, namely (1) he had applied for permission to appeal to the Court of Appeal against my order of 7 February 2023 dismissing his applications, and for the grant of a stay in the meantime, and (2) Topaz Finance had failed to comply with the order that it serve its application by 9 February 2023.

I considered these points at the hearing, and ordered that time should be extended retrospectively for the service of the application notice and evidence, and that the extended civil restraint order should be made. I said I would give a reserved judgment setting out my reasons for doing so.

A preliminary point which I raised with Mr Tipler at the hearing on 7 February 2023 was whether I, sitting as a deputy High Court Judge appointed under s.9(4) of the Senior Courts Act 1981, had power to make a civil restraint order. For the reasons given by Mr Tipler in his skeleton for the 23 February hearing, and from my own consideration of the matter, I am satisfied that I do.

CPR rule 3.11 provides that the procedure for making restraint orders is set out in Pracctice Direction 3C, paragraph 3.1(2) of which provides that:

“An extended civil restating order may be made by –

…

(2)

a judge of the High Court ….

where a party has persistently issued claims or made applications which are totally without merit.”

In my judgment, the phrase “a judge of the High Court” in paragraph 3.1(2) includes a deputy High Court Judge appointed under s.9(4) of the 1981 Act, because:

As Mr Odukoya says, the application notice and evidence were served out of time, but it is clear that they were then served on 13 February 2023, and therefore two business days after the date of 9 February 2023 which I had fixed for service in my 9 February order. This was therefore a breach of my order.

However, I was prepared retrospectively to extend time for service under CPR rule 3.1(2)(a), which allows for such even if “an application for extension is made after the time for compliance has expired”. This was because there was good reason for doing so in accordance with the principles set out in Denton v. T.H. White Ltd [2014] 1 W.L.R. 3926, because the breach was insignificant, as it did not affect Mr Odukoya’s ability to prepare for the hearing (see points (1) to (3) below), nor, given points (4) and (5), would it have been just to refuse an extension in all the circumstances. I say this for the following reasons.

Mr Odukoya’s skeleton argument also relied on his applications to the Court of Appeal for permission to appeal and for a stay pending its determination. However, these are immaterial for three reasons.

First, the extended civil restraint order sought by Topaz Finance, and which I made, does not prevent Mr Odukoya from pursuing his application for permission to appeal against my 7 February 2023 order to the Court of Appeal, because his application had already been made before the order.

Second, it is trite that an appeal (and an application for a stay) against an order does not of itself operate as a stay on it, and so the order I made on 7 February 2023, and the ruling that the 30 November 2022 and 3 January 2023 applications are totally without merit, still continue to stand.

Third, if it is otherwise appropriate to make an extended civil restraint order, I cannot see any reason which would make it just to stay the proceedings, or adjourn the making of it, pending the application to the Court of Appeal for permission to appeal against my 7 February 2023 order. I say this in particular because there is real potential prejudice if the order is deferred any further, because given the history of the matter there is a real risk that, unless now restrained, Mr Odukoya will continue to make hopeless applications or claims and thus not only put Topaz Finance to further wasted cost, which it can recover only later under the legal charge, but also impose a further burden on the court’s resources. Conversely, if his appeal were to succeed, it is difficult to see what irremediable prejudice he would suffer as a result of the extended civil restraint order being made now but later reversed.

The regime for civil restraint orders is set out in Practice Direction 3C, made pursuant to CPR rule 3.11.

By paragraph 2.1 of the Practice Direction, a limited civil restraint order may be made by a judge of any court against a party who has made two or more applications which are totally without merit, and by paragraph 2.2(1) the effect of such a limited order is to restrain that party from “making any further applications in the proceedings in which the order is made without first obtaining the permission of a judge identified in the order”.

If a party against whom such an order is made issues an application without the court’s permission, then it will be dismissed automatically, without the need for a further order or for the other party to respond to it. (See paragraph 2.3(1).) Further, if a party repeatedly makes applications for permission which are totally without merit, the court can direct that if he makes any further such application, the decision to dismiss it will be final without a right of appeal unless otherwise provided for (see paragraph 2.3(2)).

Extended civil restraint orders are governed by paragraph 3.1, which, as recited above, provides that they can be made “where a party has persistently issued claims or made applications which are totally without merit”.

Their effect, in the case of such an order granted by the High Court, is to restrain a person subject to them “from issuing claims or making applications” in the High Court or the County Court “concerning any matter involving or relating to or touching upon or leading to the proceedings in which the order is made without first obtaining the permission of a judge identified in the order”. So the extended order goes further than the limited order, both because it restrains a party from issuing new claims, and because it restrains him from doing so on any matter “involving or relating to or touching upon or leading to” the proceedings in which it was made. Paragraphs 3.3(1) and (2), corresponding to paragraphs 2.3(1) and (2), provide for the automatic striking out or dismissal of new claims or applications made in breach of the order, and for a power to direct that a decision to dismiss a further application for permission which is totally without merit will be final without a right of appeal (unless otherwise stated).

Although the word “persistently” in paragraph 3.1(3) is not defined, it is established that it requires at least three totally with merit claims or applications to be made before an extended order can be made (i.e. more than just the two applications required for a limited order under paragraph 2.1). See the Court of Appeal’s decision in Ghassemian Hamila Sartipy (aka Hamily Sartipy) v. Tigris Industries Inc. [2019] EWCA Civ 225 at paragraph 28. Further, in calculating the number of such applications, one is entitled to add the claim form itself to any totally without merit applications made pursuant to that claim (see paragraph 29); but even if there are three or more, one still has to consider whether the party concerned is acting “persistently”. This requires an evaluation of the party’s overall conduct, but it may be easier to conclude that it is “if it seeks repeatedly to re-litigate issues which have been decided than if there are three or more unrelated applications many years apart” (see paragraph 30).

Two other points made in the Sartipy case (that the rule does not apply to defendants who misbehave, but it does apply to catch the “real” party to the claims or applications behind the nominal claimant) do not apply here. There is no doubt that, whatever MFZ’s role, Mr Odukoya is the real party to the various claims and applications.

Applying these principles, my conclusion was that Mr Odukoya has persistently issued claims that are totally without merit.

First, since the limited civil restraint order imposed by District Judge Avent on 10 January 2019, Mr Odukoya has issued a further five applications which have been marked as “totally without merit” (by Deputy Master Hansen on 19 January 2022, Mrs Justice Smith on 12 April 2022 and again on 3 January 2023, and by myself, on two applications, on 7 February 2023). The requirement, therefore, for at least three such applications, even if one excludes the first two applications which District Judge Avent marked as such (on 25 November 2019 and 10 January 2020) and which led to the limited civil restraint order, is met. (I should emphasise, I have not been addressed on whether I should include those two initial applications, and so I make no finding as to whether or not they would be relevant to the question I now have to consider.)

Second, on any sensible evaluation of Mr Odukoya’s overall conduct, he has “persistently” issued applications that are totally without merit since District Judge’s Avent’s limited order. This is because all five applications turned on the same argument (that is, the charge was void for non-compliance with s.2(3) of the 1989 Act) and were made with substantially the same objective, namely to avoid having to give up possession, or latterly, to regain possession of the premises. Further, none of them was prompted by any relevant change in circumstances which might arguably have justified trying to re-run the argument.

Further, I was satisfied that in consequence it would be appropriate to impose an extended civil restraint order, rather than a limited one, so as to restrain Mr Odukoya from issuing applications or new claims “which concern any matter involving or relating to or touching upon or leading to” these High Court proceedings. Notwithstanding District Judge Avent’s limited civil restraint order, he has shown over the last three years that he is determined to prevent the enforcement of the possession order not only by making numerous hopeless applications and attempted appeals in the County Court proceedings, but also by issuing new proceedings in the High Court which were also hopeless in an attempt to get round the limited order. Further, Mr Odukoya has not put forward any evidence or argument as to why I should not make such an order.

Accordingly, I have made an extended civil restraint order against Mr Odukoya.