DENTON WATCH 2: COURT REFUSES LATE APPLICATION FOR PERMISSION TO APPEAL

In Tameside Caravans and Storage Ltd v Viavecto Ltd [2024] EWHC 95 (KB) Mr Justice Constable refused the defendant’s request for permission to appeal out of time.  The fact that the defendant was a litigant in person at the time of the default was not a major facto in relation to the exercise of the court’s discretion.

“…In  each of the passages which refer to that complexity or difficulty, the Court of Appeal continues immediately by stating that being a litigant in person with no previous experience of legal proceedings is not a good reason for failing to comply with the rules. Generally, therefore, the complexity of the litigation or difficulty of understanding the rule or order will not amount to a good reason for a litigant in person to justify a serious and substantial failure to comply with a rule, but it may be that particular obscurity or inaccessibility of the rule or order in question may be an example of the type of case which is ‘at the margins’.”

THE CASE

The defendant lost a case at trial, it wanted to appeal.  It did not wish to use the solicitors that represented it at trial.  The company, acting without representation, issued an appeal notice out of time,  further the wrong notice was used.   The Appellant’s Notice should have been filed within 21 days, it was filed some three months late.  The defendant sought relief from sanctions in relation to the late lodging of the notice of appeal.

EVENTS AFTER THE TRIAL

After the trial the defendant acted in person for a while.

1. 1. Mr Buckley took the view that he could not instruct his existing solicitors on account of a conflict of interest and his potential professional negligence claim against them. In submission Mr Skeate suggested that the solicitors told Mr Buckley that they could or would not act, but that is not what Mr Buckley says. Instead, the thrust of Mr Buckley’s evidence seems rather more to suggest that Mr Buckley himself took the view that they should not act for him, and effectively dis-instructed them. Either way, the principal point relied upon by Mr Skeate is that immediately following the trial, TCSL were no longer legally represented.

1. 1. Mr Buckley states that Mr Barraclough did not accept direct access instructions. There is no evidence to suggest that Mr Barraclough was asked to act, if necessary through alternative solicitors, and no obvious reason why he would have refused to do so. There is also no evidence that Mr Buckley sought to instruct replacement solicitors prior to the expiry of the 21-day period. In paragraph 12 of his witness statement, he states in terms that ‘apart from the logistics of locating and instructing another firm of solicitors to deal with the appeal within the time available, I was concerned about any legacy conflict of interest issues in trying to re-instruct Mr Barraclough.’ Mr Buckley states that the main reason he did not instruct another firm before the expiry of the period was that, based on the content of the trial judge’s decisions, he felt that he had enough information at the time to prepare an appellant’s notice himself.

1. Mr Skeate’s submitted that the difficulty Mr Buckley faced was with the non-availability of replacement instructing solicitors. This is based upon paragraph 18 of Mr Buckley’s statement which states ‘Unfortunately despite trying several solicitors we were unable to find one to assist us within the time needed, and a personal friend advised us to try the direct access‘. It is clear, however, from paragraph 17 that the search for instructing solicitors had only commenced after he had sent the appellant’s notice to Manchester County Court, when the Appeal was already more than a week out of time. There is no evidence that he tried to instruct alternative solicitors within the 21-day period. Mr Skeate was very clear that the issue was not related to the ability to fund alternative solicitors.

LITIGANT IN PERSON

1. 1. Although Mr Davin placed emphasis in his written submission on ‘general duty on tribunals to assist litigants’, Mr Skeate was realistic that this ‘principle’ did not relate to the situation in which a litigant in person has failed to have complied with a rule or order. Indeed, it may not be appropriate to describe the provision of assistance by a Court of Tribunal as the subject of a ‘duty’ at all. I note that in the case from which the HHJ Matthews must have derived this aspect of his summary (Drysdale v Department of Transport [2014] EWCA Civ 108), and which concerned an employment tribunal claim, the Court of Appeal referred only to the ‘long-established and obviously desirable practice of courts generally, and employment tribunals in particular, that they will provide such assistance to litigants as may be appropriate in the formulation and presentation of their case‘, noting at the same time that it remained essential that, ‘The appropriate level of assistance or intervention is constrained by the overriding requirement that the tribunal must at all time be, and be seen to be, impartial as between the parties, and that injustice to either side must be avoided.’ It is clear from the context of that case that the assistance referred to by HHJ Matthews relates to the allowance in making case management decisions and in conducting hearings referred to by Lord Sumption in the quote from Barton above, in respect of which he then observed that such ‘assistance’ will not usually justify applying to litigants in person a lower standard of compliance with rules or orders of the court. That this is so largely for a number of good reasons: upholding the general framework applicable to all, the ‘disciplinary’ factor, and (particularly in the context of time limits relating to appeals) the entitlement to certainty and finality. Thus, I would respectfully decline to endorse principle (1) as set out at paragraph [37] of EDF, at least insofar as it may be said to apply generally in the context of relief from sanctions for non-compliance with a rule or order of the Court by a litigant in person.

1. 1. Mr Davin also emphasised the third principle, namely ‘The granting of a special indulgence to a litigant in person may be justified where a rule is hard to find or it is difficult to understand, or it is ambiguous.’ Lord Sumption in Barton identifies that unless the rules and practice directions are ‘particularly’ inaccessible or obscure, it is reasonable to expect a litigant in person to familiarise himself with the rules which apply to any step which he is about to take. The only other references to complexity or difficulty of understanding rules in the cases reviewed in EDF was generally in acknowledging (by Moore-Bick LJ in Hyjas and by Maurice Kay LJ in Tinkler, the relevant passages of which I have set out above) the existence of that potential complexity or difficulty in understanding for a litigant in person. The authorities, however, are clear that this of itself is unlikely generally to be a relevant factor. In each of the passages which refer to that complexity or difficulty, the Court of Appeal continues immediately by stating that being a litigant in person with no previous experience of legal proceedings is not a good reason for failing to comply with the rules. Generally, therefore, the complexity of the litigation or difficulty of understanding the rule or order will not amount to a good reason for a litigant in person to justify a serious and substantial failure to comply with a rule, but it may be that particular obscurity or inaccessibility of the rule or order in question may be an example of the type of case which is ‘at the margins’.

APPLYING THE DENTON PRINCIPLES TO THESE FACTS

Application of the Principles to the Facts

Is the failure a serious and significant one?

1. 1. The overall delay to the service of a compliant notice of appeal (both procedurally, in relation to the Form used, and in relation to the substance of the appeal) was a delay of some 3 months. Mr Skeate adopted and advanced Mr Davin’s written position, and averred by Ms Jones, that the Court should look at this overall period when considering the first stage of the Denton test. As such, it accepts that the failure is a serious and significant one. Mr Skeate argues, however, that the fact of the failed earlier attempts including the attempts to articulate grounds of appeal, are to be taken account of at the third stage, when considering all the circumstances of the case.

Is there a good reason for delay?

1. 1. Mr Davin’s skeleton argument first suggests that the CPR may be said to present a litigant in person seeking to appeal with a ‘labyrinthine set of provisions to navigate’. This is, for the reasons set out above, not of itself, likely to be relevant except in the case of particular obscurity. The starting point is that Mr Buckley was well aware of the need to appeal within 21 days. Mr Skeate accepted this, but relied upon the potential complexity of the rules in relation to the appeal centre to which the appeal ought to have been sent. In this regard, I do not accept that the relevant rules are inaccessible or obscure. A litigant in person would be expected to read the relevant Practice Direction, 52B. This is readily available online. It is very clear. Paragraph 1 makes clear it relates to appeals from the County Court to the High Court. Paragraph 2, and the short table at the end of the Practice Direction, makes clear that Manchester is the appropriate Appeal Centre (and that the RCJ was only applicable to the South Eastern Circuit). There is nothing ‘particularly’ obscure or inaccessible about these rules.

1. 1. Mr Skeate further relied upon what was termed, in Mr Davin’s skeleton argument, the ‘entire transaction of events’. This transaction of events was back to Mr Buckley’s belief that his trial solicitor was to blame for his loss at trial because of a failure to plead certain points, and that Mr Buckley was ‘circumstantially deprived of that option because of a conflict of interest that he was essentially led to believe existed with his legal representatives, as a direct result of the nature and contents of the judgments handed down by the learned judge at trial‘.

1. 1. This analysis does not bear scrutiny.

1. 1. The starting point is that Mr Buckley may well have come away from the trial considering that, but for the failure to have pleaded the points identified by Mr Barraclough in his Skeleton Argument, he may not have lost the trial. He may additionally have considered, therefore, that his legal representatives were or at least may be, to blame. There is nothing particularly unusual about this possibility, and should plainly not affect compliance thereafter with rules relating to appeal. Moreover, it is wrong to suggest that it was the nature and content of the judgment which itself impacted on the actions then taken by Mr Buckley.

1. 1. Mr Buckley’s assumption that a conflict of interest had arisen was not, or certainly not necessarily, justified. This is because it is generally as much in the (potentially negligent) legal representatives’ interests to have the order refusing the amendment successfully appealed as it is in the lay client’s interests to achieve the same end. The interests are often generally aligned. There may, of course, be situations where this is not the case (e.g. where there is a dispute between representatives and client as to why the issue was not pleaded in the first place), but there is no evidence that this was the case here. Even these issues may often be capable of being put to one side pending any appeal, in which both client and representative share the same interest. It appears that Mr Buckley simply assumed the existence of a conflict without, it seems, even discussing the point with his existing solicitors.

1. 1. Even if there was a real or justifiably perceived conflict with his existing solicitors (or he had legitimately lost confidence in them), there is no suggestion in the evidence that there was any such issue with Mr Barraclough, his counsel, who had, most probably, identified the ‘new’ points taken in the Skeleton Argument. Mr Barraclough was aware of all the issues, no doubt was in possession of all the relevant documents, and was plainly best placed to advise on the prospects of appeal and settle any Notice. Mr Buckley’s evidence is that he thought it too difficult to attempt to instruct existing Counsel with new solicitors within the 21 days, but he offers no sensible basis for why this might have been so.

1. 1. Mr Buckley’s decision not to instruct different solicitors straight away (whether or not retaining Mr Barraclough) was seemingly based on his own belief that he was able to submit a timely appeal identifying proper grounds of appeal. This is not a case of impecuniosity driving TCSL to act in person through Mr Buckley: TCSL was represented at trial, and later TCSL instructed new counsel in order to advise and settle the appeal documents, it is just that it did not do so until October, long after the original (procedurally and substantively) non-compliant Notice had been submitted. It is clear that if TCSL had instructed new solicitors immediately, the serious and substantial delay would not have occurred. A large part of the overall delay was due to the fact that the original appeal notice disclosed no sensible grounds of appeal, no doubt because Mr Buckley did not understand what might, or might not, amount to a valid ground of appeal, and he did not take the advice he later sought. It is of note that, unsurprisingly, the Judge considering the original application for stay accompanying the Notice stated that ‘the prospects of success on appeal do not appear strong‘. Paraphrasing the words of Maurice Kay LJ from Tinkler, the fact that, if properly advised, he would have made the substantive application he has ultimately advanced, and in time, cannot avail him now.

1. 1. The matters that led Mr Buckley to take the steps he did on behalf of TCSL were, therefore, entirely based upon his own assumptions, and without the benefit of legal representation on the basis of a conscious decision not to retain his existing solicitors, or to instruct new solicitors within the 21 days’ window and/or instruct Mr Barraclough. Hysaj at [43] states in terms that the inability to instruct legal representation through lack of funds does not amount to good reason for failures resulting from acting as a litigant in person. A person who has the funds but takes a (misguided but deliberate) decision not to instruct legal representatives should not be in any better position. Concluding that the significant and serious non-compliance was caused by a ‘good reason’ for the purposes of the second test in Denton in circumstances where the same facts would not remotely have amounted to a ‘good reason’ had the same happened with TCSL legally represented, would be an indulgence significantly beyond any available tolerance ‘at the margins’.

1. 1. Therefore, there is no good reason for the delay.

The Circumstances of the Case

1. 1. I accept that, as Mr Skeate submits, even if an application fails to meet the first and second Denton tests, this is not fatal to the application and it is always necessary to consider all the circumstances of the case. Indeed, in Hysaj, the first of the three appellants succeeded notwithstanding failing to satisfy the first two steps. In that case, the two factors within the wider consideration (in a case where it was not possible to make a judgment in respect of the merits of the substantive appeal either way) were (a) that the appeal raised a point of considerable importance both to the parties and those in similar positions and to the wider public and it is one which in the public interest needs to be decided as soon as reasonably possible, and (b) the fact that the delay in filing a notice of appeal had not prejudiced the respondent. I will consider the extent to which these are present in this case, before turning to the wider considerations which Denton makes clear are factors which may be considered in all the circumstances of the case.

1. 1. In terms of specific and wider importance, I accept that this matter, which involves the possession of the Land on which Mr Buckley operates a business, is one of considerable importance to TCSL. However, matters of litigation are almost always of considerable importance to the parties. I also accept that the effect of TCSL losing possession of the Land is likely to affect third party traders who use the storage facilities and trade from the Land. That said, the evidence before the Court in relation to this is extremely thin: a single sub-paragraph at [29] of Mr Buckley’s statement, which touches briefly upon the inadequacy of damages which might be awarded in any action Mr Buckley pursued successfully against his initial legal representatives.

1. 1. The extreme prejudice Mr Skeate argues will result from an inability to bring the appeal is based upon the assumption that, but for the inability to appeal, TCSL will have lost the significant benefit of a lease with security of tenure for many years into the future and upon which the business has relied and would continue to rely. This is clearly an overstatement of the position. First, the previous leases TCSL had both with Network Rail and with Viavecto prior to entering the Further Lease in 2020 were already excluded from the security of tenure provisions. TCSL had, therefore, always been operating on the basis that the landlord had the right to exercise a break clause. The Judge at trial concluded that the Further Lease which governed the relationship between the parties from 2020 onwards was valid, that Mr Coffey had capacity to sign it (on the basis of Mr Buckley’s evidence that ‘There was nothing wrong with his mental state‘), and that the Break Notice was valid. These findings have not been appealed. The ‘new’ point in the Skeleton Argument raised an extremely technical argument about the form (rather than substance) of the Declaration. It may or may not have turned out to be a good technical point, but it remains the case that if suddenly TCSL found itself with a lease which benefited from security of tenure, that would have come about completely by luck rather than design. TCSL would (by virtue of the technical point) be in a much better position than it had been during previous years of operation of its business. Second, the Further Lease was for three years, and ended in August 2023, some time ago now. But for this litigation, it is clear that the parties would have engaged in the relevant process pursuant to section 25 of the Act in circumstances where it is plain from the evidence served by Viavecto in the trial below (referred to at paragraph 33 of the Judgment) that it wished to use the land for its own business. There is no knowing what the outcome of that process would be. However, there is plainly a very real prospect that (but for this litigation), Viavecto would have validly terminated the lease by now in any event. Therefore, approaching the question of prejudice to TCSL on the basis of that, by disallowing the opportunity to appeal, TCSL will lose the clear benefit of a lease with security of tenure for many years in the future, upon which the business had been built and upon which it relied, would be wrong.

1. 1. I have considered, as I should, the factors set out in 3.9(1), namely the need for litigation to be conducted efficiently and at proportionate cost, and to enforce rules. To a large extent, these factors in a case such as this feed into the general approach set out above to restrict the tolerance allowed to a litigant in person to that which might operate at the margins.

1. 1. The question of promptness overlaps with the consideration of whether there was a good reason for the delay. TCSL realistically accepts (at paragraph 25(d) of its Skeleton Argument) that the application for relief had not been made promptly. Whilst I accept Mr Skeate, in seeking to mitigate this, is correct that this case is distinct from those in which an applicant has taken no step whatsoever to comply with a rule of which they were aware (in that Mr Buckley clearly made efforts in August 2023 to submit an appeal); and I also accept that this is not a case where any rules were deliberately flouted. This must be weighed against Mr Buckley’s conscious decision to act without the benefit of legal representation in circumstances where there was no funding issue and (contrary to the submission of Mr Skeate, as I have found above), there is no evidence for the surprising proposition that there were simply no solicitors willing or available to assist in initial period. Moreover, a further delay of some 6 weeks after receiving all the necessary material at the beginning of October cannot be regarded as ‘prompt’ and there is no particular explanation in relation to this.

1. 1. In terms of the prejudice to Viavecto, there is force in the submission of Mr Skeate that the prejudice to Viavecto is limited to the general delay and absence of finality that they would otherwise enjoy absent the provision of relief. But this does not mean that there is no prejudice.

1. 1. Finally, in the context of consideration of the merits of the case, Mr Buckley’s witness statement expressly requests at [26] that the Court should consider the merits of the appeal when deciding the application, which he believes are strong. Indeed, at one point Mr Skeate suggested that I may be able to deal with the substantive question of permission as part of this application (although he did not press me to do so). Guidance on the extent to which such consideration should be embarked upon was also provided in Hysaj at paragraph 46 in the following terms:

‘Only in those cases where the court can see without much investigation that the grounds of appeal are either very strong or very weak will the merits have a significant part to play when it comes to balancing the various factors that have to be considered at stage three of the process. In most cases the court should decline to embark on an investigation of the merits and firmly discourage argument directed to them. Here too a robust exercise of the jurisdiction in relation to costs is appropriate in order to discourage those who would otherwise seek to impress the court with the strength of their cases.‘

1. 1. 1. I have been able to form a view without much investigation. I do not consider that the merits of the appeal are strong. Indeed, I consider that the merits are very weak. In my judgment it is strongly arguable that the central points raised by Mr Barraclough in the Skeleton Argument on the eve of trial relating to the validity of the Declaration were new points which ought properly to have been pleaded, and the claim that the determination to this effect by the trial Judge was a serious irregularity is very weak.

1. 1. It is plainly correct, as advanced by Mr Barraclough in the trial below and in Mr Davin’s skeleton argument on appeal, that a defendant is only required to plead facts and not law in their Defence. It is also the case, however, that where a defendant denies an allegation, they must state their reasons for doing so (CPR16.5(2)).

1. 1. Here, the Claimant pleaded the existence of the Further Lease, and asserted that before it was entered into, an agreement was entered into excluding the protected tenancy rights had been effected, as referred to in Clause 7 of the Lease. This was an express reference to the Declaration, which was appended to the pleading as EXH3 (paragraph 10 of the Particulars of Claim).

1. 1. The Amended Defence denied this plea explicitly at paragraph 10. This was not a bare denial: the positive case advanced to justify this denial was that (in the terminology of this Judgment) the First Lease, which on the basis of the preceding paragraphs TCSL averred was the instrument which governed the parties’ relationship, included no valid provision excluding security of tenure. The positive case for the denial of exclusion of security of tenure was explicitly advanced on the basis of the assertion that the First Lease continued to govern the parties’ relationship, for the reasons set out in paragraph 8.

1. 1. No positive case was advanced that the Declaration did not constitute a statutory declaration because it was made using the wrong form and/or missed essential wording. Moreover, the only fair reading of the Defence is that TCSL accepted that, if the Further Lease was itself valid (which it denied for the reasons in paragraph 8), there was no issue that the Declaration annexed to the Further Lease was a statutory declaration. For example, the Defence stated:

(1) At paragraph 8(g), (in respect of knowledge of the Further Lease), ‘Mr Coffey had not referred to signing any other versions nor to making a statutory declaration….’

(2) At paragraph 8(q), (in respect of lack of capacity), ‘…the Claimant appears to have approached Mr Coffey, requiring him to sign [the Further Lease] and a statutory declaration….’

(3) At paragraph 8(r), (in respect of lack of capacity): ‘Mr Coffey could not have understood the implications of signing [the Further Lease] and the statutory declaration as had he done so, he would not have signed such documents…’

1. 1. The suggestion that the argument advanced in the Skeleton Argument on the eve of trial was a pure issue of law which did not need to be pleaded is simply wrong. Each argument involved a mixture of fact and law, and the facts had to be pleaded as part of the positive case supporting the denial that Viavecto had successfully excluded security of tenure.

1. 1. In relation to the invalidity of the Declaration taking effect as a declaration, the key factual allegation was that no s3A(3) Notice had been served. Validity of the document is not discernible merely as an exercise in construction. TCSL (in its Skeleton Argument for trial) positively averred that Declaration was invalid as a declaration because no s3A(3) Notice had been served not less than 14 days before the tenancy was entered into. That (factual) averment needed to have been pleaded, to enable the Claimant to investigate whether that is factually correct, or not. Moreover, given that the Declaration was arguably signed and witnessed as a deed, the Claimant was entitled to consider whether, for example, an estoppel by deed arose (where the deed stated made clear a s3A(3) Notice had been served more than 14 days previously) to prevent as a matter of law the assertion that no such document had been served, or estoppel more generally.

1. 1. In relation to the invalidity of the Declaration as a statutory declaration, the critical factual allegation relied upon was the use of the wrong form which did not contain a particular form of words, such that it was (as a matter of fact) a declaration rather than a statutory declaration.

1. 1. It was of course not necessary for TCSL to plead the legal argument, or authorities, that substantiated its asserted conclusion that, in light of the use of the wrong form, the Declaration was merely a declaration rather than a statutory Declaration or the legal argument that, thereby, no security of tenure was not excluded. However, pursuant to basic rules of pleading, which are grounded in fairness, TCSL plainly needed to identify, so that the Claimant could properly understand the case it would have to meet, that it denied that the statutory declaration was valid not just because it was annexed to the Further Lease which was itself invalid, but because (even if the Further Lease was valid), it was not in fact a statutory declaration because, as a matter of fact, the wrong form had been used. The suggestion that such a case could fairly have been advanced at trial with no notice as a pure issue of law is wrong.

1. 1. The Judge was, therefore, more than justified in concluding that the new point ought to have been pleaded.

1. 1. Having so found, the Judge was also well within his case management powers to determine, on the application to amend, that allowing the amendment would be prejudicial absent an adjournment, and that no such adjournment could be allowed. In light of the allegations made, Viavecto was entitled to time to investigate what potential answers to the new allegations existed. This might involve questions of fact relating to the service of documents which could constitute a section 38A(3) notice, the issue of estoppel, or the circumstances in which the wrong form had been used. This in turn may include the parties’ knowledge and/or acquiescence in this fact and any discussions at the time, particularly given that the declaration was being witnessed by a solicitor which (in substance) is the key difference a declaration and a statutory declaration.

Conclusion

1. In light of the serious and substantial breach, without good reason, and having considered all the circumstances of the case, the application retrospectively to extend time for permission to appeal is refused.