In McWilliam -v- Norton Finance [2015] EWCA Civ 186 the Court of Appeal made some important observations in relation to admissions and the withdrawal of admissions.


The claimant was suing the defendant for secret commissions. The defendant argued that it did not receive the commissions but they were received by a third party, Fintel Limited, which used Norton Finance as a trading name. However earlier in the proceedings the defendant had made an admission that it had received the funds. The Recorder, however, dismissed the claims on the grounds that the funds had been received by a third party.


  • Having admitted an issue in correspondence and in the pleadings the defendant needed permission of the court to withdraw that admission.
  • The admission was not (and could not be) “impliedly withdrawn” by the service of an amended defence.
  • The defendant had never made an application to withdraw from the admission.
  • The judge should have found that the admission had not been withdrawn and, in any event, refused any application to withdraw.


The facts are somewhat complex but I have highlighted the main points.


The admission Point

  1. Paragraph 5 of the Particulars of Claim dated 18 August 2009 alleged that Norton, in breach of fiduciary duty owed to the Claimants, had received the additional commissions, payment of which was made without informing the Claimants either as to the fact of payment or as to the amount.
  2. In its Defence of 30 September 2009 Norton denied receipt of the additional commissions. It acknowledged receipt of £750 from Fintel on completion of the loan “to cover Norton’s packaging and processing costs.” This is presumably a reference to the “broker fee.”
  3. On 12 March 2010 the Claimants’ solicitors indicated to Norton’s solicitors that the complexities of the issues in the case, including the relationship between Norton and Fintel, rendered it appropriate that the case be reallocated to the Multi Track and assigned a time estimate of two days for trial.
  4. Norton’s solicitors were concerned to reduce costs and in particular, to that end, to avoid reallocation of the case to the Multi Track. Accordingly, on 25 March 2010 they wrote to the Claimants’ solicitors in these terms:-

“In relation to payments by the First Defendant in relation to the PPI, and for the purposes of these proceedings, Norton Finance UK Ltd are to be treated as having received the monies described in the Particulars of Claim as being “commission”.

For that purpose therefore and whether acting as Principal or Agent in relation to the PPI, Norton Finance UK Ltd will bear any liability that the court considers arises in relation to the PPI as claimed by the Claimant in these proceedings.

On receipt of the “commission”, there was a private arrangement between Norton Finance UK Ltd and Fintel Ltd as to the allocation of commission between them.

In the regard therefore and for the purposes of these proceedings, it is accepted therefore that Norton Finance UK Ltd received the “commission”.

We therefore enclose an amended Defence to reflect the position as set out in this letter.

We would be grateful if you would please let us know whether you require our client to make an application to Court for the purposes of that amendment.”

That seems to be an admission of receipt of the PPI commission, although not the loan commission, an impression borne out by the Amended Defence. The new paragraph 5 in that document read:-

“The Second Defendant denies that it owed the Claimants a fiduciary duty as claimed in paragraph 5 of the Particulars of Claim or at all. The Second Defendant admits that it received monies from the First Defendant which included a commission in respect of the Payment Protection Plan. No admission is made by the Second Defendant to the last sentence of paragraph 5 of the Particulars of Claim. Save as admitted and averred paragraph 5 of the Particulars is denied.”

I should add that the last sentence of paragraph 5 of the Particulars of Claim is the allegation that the commission payments were made without informing the Claimants either as to the fact or as to the amount of payment.

  1. On 27 April 2010 there was filed the first Witness Statement of Julie Gregory, Norton’s Group Compliance Manager. At paragraph 36 she said this:-

“For the purposes of these proceedings, Norton Finance (UK) Limited dealt with all of the matters and therefore should any liability be determined by the Court in relation to the PPI then that liability will be met by Norton Finance (UK) Limited.”

  1. On 20 May 2010 Norton’s solicitors wrote to the Claimants’ solicitors in these terms:-

“We cannot agree at the present time that the matter comprises the complexities you allege, thereby requiring a two day Hearing and reallocation to Multi Track.

In other matters where the same issues have been raised against our client, together with the lender, the matter has been disposed of in less than a day.

The matter of Fintel Limited referred to in your letter to the Court of the 12th May 2010 has been settled by reason of the amended Defence.”

  1. On 22 September 2010 Norton’s solicitors wrote again to the Claimants’ solicitors. In that letter they stated:-

For the purposes of these proceedings, Norton Finance (UK) Ltd received the commissions together with a broker’s fee referred to in paragraph 23 of Julie Gregory’s witness statement. Paragraphs 34 and 35 of Mrs Gregory’s witness statement together with exhibits referred to therein identifies the commission of £2,675.00 being paid to Norton Finance (UK) Ltd in respect of the loan. In addition there was £1,685.25 being received by Norton Finance (UK) Ltd from Pinnacle Insurance in respect of the PPI. Of the commissions received by Norton Finance (UK) Ltd for the loan, Norton Finance (UK) Ltd made a payment to Fintel Ltd which was a private arrangement between those companies. Consequently the pleadings and evidence on behalf of Norton Finance (UK) Ltd evidence and confirm that Norton Finance (UK) Ltd received the commissions in relation to the matters raised in these proceedings.”

  1. On 10 March 2011 District Judge Cuthbertson directed that the claim be reallocated to the Multi Track. He also gave the Claimants permission to amend their Particulars of Claim. The resulting Amended Particulars of Claim were, as the Recorder later observed with studied understatement, somewhat diffuse, but the allegation concerning the receipt of the additional commissions in breach of fiduciary duty was effectively wholly unchanged. The order of the District Judge was simply that the Defendants be permitted to file and serve an Amended Defence. In the ordinary way, that should be regarded as permitting amendments consequential on the amendments to the Particulars of Claim, which were substantial, but for the present purposes irrelevant. I should add that the Amended Particulars of Claim were introduced at paragraph 1 with the following statement:-

“These Particulars of Claim replace the original Particulars of Claim in their entirety… “

  1. On 11 April 2011 Norton filed a Re-amended Defence. That document was introduced with the following preamble:-

“This Re-amended Defence is served in response to the Amended Particulars of Claim served by the Claimants. It replaces in its entirety any earlier versions of the Defence.”

The relevant paragraph read:-

“11. Norton plead as follows to paragraph 15 of the Particulars of Claim:

a) It is denied that Norton owed the Claimants any such fiduciary or ‘general’ duties.

b) If such duties did exist, they were not breached.

c) Norton do not admit that they received commission payments totalling £2,675 in respect of the loan and £1,685.25. The Claimants are specifically required to prove that Norton (as opposed to any other third party which had outsourced its packaging and processing operations to Norton) received such payments.

d) Norton made adequate and appropriate levels of disclosure to the Claimants. Such disclosure was made in accordance with their obligations as independent intermediaries acting on their own account.”

I should add that whilst paragraph 15 of the Amended Particulars of Claim is not couched in identical language to paragraph 5 of the unamended Particulars of Claim, the only, and immaterial, difference is that the receipt of the additional commissions is said to have been a breach of both Norton’s fiduciary duty and its “general duty”.

  1. On 3 May 2011 the Claimants served a Reply. Paragraph 8 reads:-

“8. As to paragraph 11 of the Re-Amended Defence the Claimants join issue with Norton and put Norton to proof as to 11 (c) in not admitting the commission payments in the light of the First Defendant’s averrals as to such payment as set out in paragraph 18 of the Particulars of Claim both as to the payment of commission and as to the agreement with Norton. It is simply inappropriate for Norton to rely upon an undisclosed agency relationship with a third party without showing how the Claimants were aware of such agency and such averral is amendable to strike out by the Court of its own motive.”

The reference to the First Defendants is a reference to Money Partners. This is a curious paragraph, but it was in any event overtaken by further correspondence.

  1. On 4 May 2011 the Claimant’s solicitors wrote to Norton’s solicitors in these terms:-

“We ask you to consider forthwith the re-emerged allegation regarding Fintel Limited. We understood that you had conceded this matter and in view of the imminence of Trial believe this ought to be sorted out forthwith.”

Trial was listed to start on 31 May 2011.

  1. On 16 May 2011 two letters crossed. Norton’s solicitors, who had in the meanwhile been reminded of their letter of 25 March 2010, set out at paragraph 1 above, promised to revert in respect of the issue as soon as possible. The trial was by now of course only two weeks away. However on the same day the Claimants’ solicitors wrote:-

“We also refer to our telephone conversation when we pointed out to you the reason why we wrote on the 11th May and make specific reference to letter dated the 15th (sic, 25th is obviously intended) March 2010.

What is not clear from the letter is whether Norton also accept that any payments made to it by the lender in respect of the loan (as distinct to the PPI) are to be treated as having been received by Norton and would you please clarify in this respect.

If your client is not seeking to resile from the matters addressed in the open letter of the 15th (sic) March 2010, please confirm that your client withdraws from the appropriate averrals in the Re-Amended Defence set out in paragraph 11.

It is our clients’ case that your client is estopped from raising such issue and in view of the imminence of Trial this matter does need clarifying forthwith.”

  1. On 17 May 2011 the Claimants’ solicitors wrote again to Norton’s solicitors. I set out the letter in full:-

“This matter is listed for a 2 day Multi Track Hearing two weeks today and we are most disturbed that the issue the subject of recent correspondence is still outstanding. We have written to you about this on a number of occasions and have specifically referred to correspondence from you regarding the issue of Fintel Limited and the receipt of commissions, and your letter of yesterday still fails to reaffirm the position that your client accepts that commission payments have been received by it from the lender.

We shall be asking the Court to order Judgment un our client’s favour on this issue and for a Costs Order in any event by reason of the following:-

1. The originally pleaded Defence that Fintel Limited and not your client received commissions has been made.

2. There was considerable inter party correspondence before receiving your written acknowledgement conceding the Claimants’ case in this respect.

3. The latest Amended Defence again has pleaded the issue and notwithstanding that we raised this with you, you stubbornly refuse to acknowledge what we view as a position that your client is estopped from averring, and put us to the trouble of alerting you to your own correspondence.

4. Notwithstanding the clear wording of your own letter, which we identified yesterday, you have responded that you are still considering the position.

We are also concerned that there appears to be further failures on your part to understand your client’s own averrals as follows:-

1. By letter dated the 2nd September 2008, and as set out in the Re-Amended Particulars of Claim, Money Partners confirm paying £2,675.00 to Norton Finance.

2. Julie Gregory of your client admits in her Witness Statement of the 27th April 2010 (paragraph 36) payment of monies to the Defendant from the lender.

3. The email disclosed yesterday and being item 5 of your supplemental disclosure refers to there being a written agency agreement in place between Fintel Limited and Money Partners Limited, but that this is unavailable. However, your own disclosure (originally in support of your averrals that Fintel Limited and not your client received the commissions) contradicts such email (see paragraph 52(x) to (zii) of original Trial Bundle.

Quite frankly, your conduct throughout and as evidenced herein, is embarrassing and yet your client resolutely seeks to pursue this case. We shall be asking the Judge to have regard to these matters and to sanction your clients in respect of the same.

This is not an appropriate way to conduct litigation and it does not appear that both you and Counsel are unclear as to your own case and as to the frailties, as we see them, in such Defence.

This letter and the appropriate correspondence and pleadings will be drawn to the attention of the Court and we again ask you to confirm by return your client’s position and to deal with the outstanding query relating to loan commissions as stated in our communication of the 16th instant. “

  1. On 19 May 2011 Julie Gregory’s second Witness Statement was served. So far as relevant it reads:-

“3. There is a Broker Agreement between Money Partners Limited (“MPL”) and Fintel Limited (“Fintel”) which was disclosed by the solicitors to the Claimants under cover of their letter to me dated 20/04/09, a copy of which is attached at pages 1 – 9 of exhibit “JG2”. Fintel was a credit broker based in Jersey. It was a separate company to Norton although it had a trade name of Norton Finance which it used in its advertising. As I understand it, Fintel is no longer trading in that it is not doing any new business but it is carrying out day to day administration. Fintel advertised for loans and outsourced the information gathering, processing and packaging of those loans to other companies such as Norton.

4. As I understand it the Solicitors to the Claimants are trying to make an issue regarding Fintel and the receipt of commissions and whether Norton accepts that commission payments have been received by it from MPL.

5. As has always been stated in this matter, Norton only received a processing and packaging fee of £750 which was paid to Norton by Fintel. I refer to my letter to the Claimants’ Solicitors dated the 13th May 2009 which is exhibited at pages 39 and 40 to my original Witness Statement. In my letter I have stated that Fintel paid £750 to Norton. Once Fintel had passed the enquiry to Norton, the enquiry would be dealt with in our usual way as described in my original Witness Statement.

6. The completion fee of £500 which is referred to on the first page of the Credit Agreement between the Claimants and Money Partners Loans Limited was received and kept by the lender. For the avoidance of doubt, the sum of £500 was not paid to Norton.

7. I will also confirm for completeness that the commission sums of £2675 for the loan and £1685.25 for the PPI were paid by the lender to Fintel. I understand that the letter from MPL dated 02/09/08 which is exhibited at page 37 to my original witness statement refers to these payments both being made to “Norton Finance”. In view of the fact that there is no agreement between Norton and MPL (or Money Partners Loans Limited), the fact that there is an agreement between MPL and Fintel, and Norton did not receive either of these commissions, I can only deduce that when MPL refers to “Norton Finance” it means Fintel Limited trading as Norton Finance. I confirm that Norton did not receive any part of these two commission payments.”

  1. On 31 May 2011 the trial began. Mr Banks for the Claimants identified in his brief opening that there was an issue whether Norton had received the commissions. However in his skeleton argument dated 30 May 2011 which the Recorder was invited to and did read before the trial, Mr Banks made clear that the Claimants relied upon the concessions contained in Norton’s solicitors’ letter of 25 March 2010, the Amended Defence which followed it, the admissions in the first Witness Statement of Julie Gregory and the express clarification provided by Norton’s solicitors in their letters of 20 May 2010 and 22 September 2010. Mr Banks pointed out that Norton had never sought to resile from these admissions, which was correct in the sense that Norton had never made an application to the Court to withdraw its admission. CPR 14.1 (1) provides that “a party may admit the truth of the whole or any part of another party’s case.” Paragraph 14.1 (2) goes on to provide “the party may do this by giving notice in writing (such as in a statement of case or by letter).” Paragraph 14.1 (5) provides:-

“The permission of the court is required to amend or withdraw an admission.”

  1. After Mr Banks’ extremely short opening the oral evidence was called. There then followed an attempt by Mr Banks to cross examine Julie Gregory on the effect of the pleadings and the solicitors’ correspondence. This predictably unsuccessful exercise at least had the merit of flushing out the true nature of the dispute. Mr Turner for Norton interrupted and took his stand on the Re-Amended Defence having implicitly withdrawn the admission. He explained that the concession had initially been made with a view to keeping costs down but that once the Claimants had succeeded in having the case reallocated to the Multi Track and set down for a two day trial the “costs saving motivation” had disappeared.
  2. So far as the witness was concerned, she was very clear in her evidence, which was effectively unchallenged, that although Norton had been the broker responsible for “sale” of the loan and the PPI, and had at an earlier stage accepted that it had received the two additional commissions, the truth was that it had in fact been Fintel which received them.
  3. The matter was not again addressed until final submissions. Mr Banks took the point that receipt of the additional commissions had been admitted in correspondence and on the pleadings and that no application had been made to be permitted to resile from the admission. Somewhat ironically it was Mr Turner who drew the attention of the Court to the provisions of CPR 14.1. Mr Banks did not rely upon any prejudice which had accrued to the Claimants in consequence of reliance on the admission. He did however make the point that the Claimants did not know whether Norton and Fintel were connected parties and that it might be irrelevant which of them had actually received the commissions. Later he abandoned that approach in these terms:-

“There is the argument that the two companies are connected, and so payment to one is payment to the other, but I do not think that the Court has the evidence to be able to substantiate that claim at this point.”

Mr Turner for his part acknowledged that the position was unsatisfactory but persisted with his submission that the admission was implicitly withdrawn by service of the Re-Amended Defence. He did not make an application for permission to withdraw the admission.

  1. The judge regarded the position as very unsatisfactory but, despite the absence of a formal application for permission to withdraw the admission, she did not hold Norton bound by it. She noted the purpose for which the admission had been made and continued:-

“28. Despite the lack of a formal application for permission to withdraw the earlier admission I do not hold Norton bound by it. The purpose of the rules as to admissions is to reduce costs and delay by encouraging parties to narrow the issues by making admissions. The first consideration though must be to give effect to the overriding objective to deal with cases justly and Mrs Gregory having been cross-examined on who received payment of commission and having given credible evidence that it was Fintel, I do not consider it would be in the interests of justice for me to proceed as though that evidence had not been given on a central issue in the proceedings. “

29. In terms of explanation for the withdrawal of the admission, it was said that it had been a qualified admission for the purpose of the proceedings and I note that although that was not expressly stated in the re-amended Defence it was so stated in the solicitors’ letter with which it was served dated 25th March 2010.The wish to keep the matter in the fast track presumably by confining the issues is borne out by the chronology – the concession was withdrawn when the matter had been re-allocated.

30. It has been apparent from the service of the re-amended Defence that Norton were or may be seeking to resile from their earlier admissions. In their letter of 16th May 2011 for example the Clamaints’ solicitors said ‘if your client is not seeking to resile …please confirm that your client withdraws from the averrals in paragraph 11 of the (re)amended Defence’. There is no evidence that the Claimants were prejudiced in the presentation of their case at trial but were aware that this remained an issue and Norton’s witness, Mrs Gregory, was cross-examined upon it.

31. However, I do consider that the position is very unsatisfactory as Norton’s counsel acknowledged. There has been strategic manoeuvring and a lack of transparency by Norton.”

  1. In my judgment the judge did on this issue inadvertently and for understandable reasons reach a conclusion which was in all the circumstances unjust. The fact that evidence had been given which contradicted the admission was not initially relevant. The question in such circumstances, as pointed out by Lord Phillips of Worth Matravers MR in Loveridge v Healey [2004] EWCA Civ 173, at paragraph 24, is whether the party in question should be permitted to advance a case which has not hitherto been pleaded. So had the non-admission of receipt of commission in fact been pleaded? Although it is not I think put in this way by Mr Clark, Norton did not in my view have permission to amend their Defence so as to withdraw the admission, because the Order of 10 March 2011 of District Judge Cuthbertson, properly understood, permitted only amendments consequential on the amendments to the Particulars of Claim. The judge was therefore in my view quite correct not to accede to the submission that service of the Re-Amended Defence involved an implicit withdrawal of the admission. It did not, because withdrawal could only be achieved with permission of the court. Mr Banks was therefore right to assert that no application to withdraw the admission had been made or adjudicated upon. The judge has effectively permitted the withdrawal of the admission on her own motion pursuant to her wide case management powers. Although she was addressed at length by Mr Banks, she did not in fact give him an opportunity to address the question whether withdrawal of the admission should be permitted, for the simple reason that Mr Banks did not realise that he had to address such an application. It can doubtless be said that had Mr Banks identified any prejudicial reliance on the admission, it would have concentrated the judge’s mind on whether it was in the circumstances appropriate to permit withdrawal of the admission, but in fairness to Mr Banks he had made very clear his position that there was simply no application to withdraw the admission, and therefore no need to address argument on the question whether withdrawal should be permitted.
  2. I would not for my part be critical of Norton for admitting receipt of the commissions for the purpose of the proceedings only and in an effort to reduce the ambit of the dispute and thus its exposure to costs. The question is rather whether, that attempt having failed, Norton should be permitted to resile from the position adopted, and if so on what terms. The considerations which are then relevant include those helpfully summarised at PD 14 paragraph 7.2. The critical features here were the prejudice that might be caused to the Claimants if the admission was withdrawn, the stage in the proceedings at which any application fell to be considered, in particular in relation to the trial date, and the prospects of success of the claim in relation to which the admission was made in the event that it was withdrawn. Whilst the judge recorded that there was “no evidence that the Claimants were prejudiced in the presentation of their case at trial, and that Mrs Gregory was cross-examined upon it,” with respect to the judge the cross-examination of Mrs Gregory, and Mr Banks’ acceptance that the Court did not have the evidence to substantiate the suggestion of a connection between Norton and Fintel, was ample demonstration of prejudice to the Claimants if Norton was not to be held to its admission. In the light of the admission there had been no disclosure given by Norton, or by Money Partners for so long as they remained in the Action, on the issue of receipt of commission or as to the relationship between Norton and Fintel. Further investigation might very well have revealed either that Norton had indeed received the additional commissions or that it was immaterial to which of them the commissions were in fact in the first instance paid, because of their close relationship. Understandably the Claimants did not undertake these investigations or press for disclosure. Effective cross-examination of Mrs Gregory on this topic was impossible in the absence of documents evidencing receipt of the commissions, indicating the nature of the relationships, and generally making good her assertions. In the event the Claimants were forced into conceding that if the Court found that Norton did not receive the commissions, any claim against it founded on breach of fiduciary duty must fail.
  3. It is unfortunate that the Claimants’ solicitors did not follow through their asserted intention to seek a ruling from the Court on the status of the admission – see their letter of 17 May 2011. However that may be, the upshot is I consider that the judge has exercised a discretion which she was not asked to exercise and upon which she was not addressed. The result is one of manifest unfairness. In my judgment Norton should have been held to its admission. It follows that the judge did have to decide whether Norton owed a fiduciary duty to the Claimants, and we must therefore re-examine the conclusion to which she indicated she would have come had that point arisen for determination. It is as I have already pointed out unfortunate that we must perform this task without the benefit of adversarial argument.