COSTS

Protective costs order - application for judicial review by organisation acting in public interest - applicant seeking protective costs order - guidelines

R (Corner House Research) v Secretary of State for Trade and Industry: CA (Lord Phillips of Worth Matravers Master of the Rolls, Lords Justice Brooke and Tuckey): 1 March 2005



The claimant was a non-profit making company that examined bribery and corruption in international trade. In 2000, the Export Credit Guarantee Department (ECGD) of the Department of Trade and Industry, which supported trade by British exporters, issued a new procedural code that laid more stringent requirements on applicants for ECGD support. After consultation with exporters those procedures were revised.


The claimant sought judicial review of the secretary of state's decision. Its application for a protected costs order for the substantive hearing of the judicial review application was refused. The claimant appealed.


Lord Lester of Herne Hill QC and Ben Jaffrey (instructed by Leigh Day & Co, London) for the claimant; Monica Carss-Frisk QC and Brian Kennelly (instructed by the Treasury Solicitor) for the secretary of state; Richard Drabble QC and Michael Fordham (instructed by the Public Law Project, London) for the Public Law Project as interveners.


Held, giving reasons for allowing the appeal and guidance on the making of protected costs orders, that an order could be made at any stage of the proceedings, on such conditions as the court thought fit, provided that the issues raised were of general public importance, the public interest required those issues to be resolved and the applicant had no private interest in the outcome of the case; that having regard to the financial resources of the parties and the likely amount of costs, it was fair and just to make the order and if it were not made the applicant would probably discontinue the proceedings and would be acting reasonably in so doing.






CRIMINAL


Confiscation order - power to increase realisable sum recoverable under confiscation order - application to increase engaging convention right to hearing within reasonable time

In re Sagger: CA (Lords Justice Mummery, Rix and Carnwath): 24 February 2005


The defendant was sentenced in 1995 to imprisonment for importing drugs and a confiscation order was made in the sum £1,370 on the basis that it was his sole realisable asset of cash then available, although his proceeds from the drug trafficking was assessed at £724,115.01. He paid the confiscation sum and, in 1996, was released from prison.


In 2003, customs applied to the High Court under section 16 of the Drug Trafficking Act 1994 for a certificate to increase the confiscation sum on the basis that the amount that might be realised from him was greater than the amount which had been taken into account in making the confiscation order. Mr Justice Owen, granting the application, held that article 6(1) of the European Convention on Human Rights applied only to the making of the original confiscation order and not to the certificate for increase under section 16. The defendant appealed.


Tim Owen QC and Andrew Bodnar (instructed by Hughmans, London) for the defendant; Collingwood Thompson QC and James Dennison (instructed by the solicitor, Customs & Excise) for customs.


Held, dismissing the appeal, that the reasonable time requirement of article 6(1) was engaged by an application under section 16 of the 1994 Act, and for those purposes the period of time which should be considered was the whole period of the drug trafficking offence proceedings and not only the time from the institution of the section 16 application in 2003; and that the certificate should nevertheless be issued for the consideration of the Crown Court having jurisdiction over the confiscation order where the parties could argue the article 6 point on the merits of the application. (WLR)






EDUCATION


School - refusal to allow Muslim pupil to wear jilbab rather than shalwar kameez - circumstances amounting to exclusion and limitation of right to manifest religion

R (Shabina Begum by her litigation friend, Shuweb Rahman) v Head Teacher and Governors of Denbigh High School: CA (Lords Justice Brooke, Mummery and Scott Baker): 2 March 2005

The claimant was a schoolgirl of Muslim faith who wished to attend the defendant school wearing the jilbab and not, as school policy required, the shalwar kameez. The school refused permission. The claimant applied for judicial review of that decision but the judge found that she had not been excluded from school and dismissed the application. The claimant appealed, now seeking merely declaratory relief and neither damages nor return to the school.


Cherie Booth QC, Carolyn Hamilton and Eleni Mitrophanous (instructed by Alason Carter, Colchester) for the claimant; Simon Birks (instructed by Richard Stevens, Luton) for the defendant.


Held, allowing the appeal, that the claimant was undoubtedly excluded and, where there had been a limitation of her right under article 9(1) of the European Convention on Human Rights to manifest her religion, a structured approach should have been followed in looking to potential justification under article 9(2), and in particular the question of necessity; but that, since the school had not adopted such an approach, declarations would be made that the claimant was unlawfully excluded from school, and that the school had both unlawfully denied her the right to manifest her religion and unlawfully denied her access to suitable and appropriate education.






LOCAL GOVERNMENT


Powers - introduction of parking scheme on local authority housing estate - by-laws not required to render scheme valid

Akumah v Hackney London Borough Council: HL (Lord Hoffmann, Lord Scott of Foscote, Lord Walker of Gestingthorpe, Baroness Hale of Richmond and Lord Carswell): 3 March 2005


The local authority introduced a parking scheme for the housing estate on which the claimant lived. It was instituted by a resolution of the council and not by the passing of by-laws.


Under the terms of the scheme, a vehicle could only be parked if there was exhibited on it a permit. Vehicles not displaying a valid parking permit or parked in places other than in designated parking bays could be removed and clamped.


The claimant, whose car had been clamped three times, commenced proceedings claiming the return of the fines paid by him to have his clamped car released and damages for wrongful detention of the car. He alleged, among other things, that the parking scheme was invalid since it should have been introduced by by-law under section 23(1) of the Housing Act 1985 and section 7(1) of the Greater London Council (General Powers) Act 1975.


The district judge dismissed his action and was upheld by the Court of Appeal. The claimant appealed.


Sibghatullah Kadri QC and CE Pipi (instructed by Watts Compton, London) for the claimant; Andrew Arden QC and Christopher Baker (instructed by Hackney Legal Services) for the local authority.


Held, dismissing the appeal, that it was inherent within the 'management, regulation and control of a local housing authority's houses', pursuant to section 21(1) of the Housing Act 1985, that parking on a local authority housing estate should be regulated; that unregulated parking could, in many housing estates, lead to congestion of the roads and the unavailability of places for residents to park their cars if other persons could park there at will; that regulation was also important to ensure access for service and emergency vehicles to the houses on the estate; that those factors were clearly capable of affecting the amenity of life for the residents and their access to, and enjoyment of, their houses and flats on the estate; that safeguarding and improving that amenity and facilitating that access and enjoyment were proper functions of a local authority managing a housing estate; that, further, by the terms of section 111 of the Local Government Act 1972, a local authority had power to do anything which was 'calculated to facilitate, or was conducive or incidental to, the discharge of any of their functions'; that the functions of a local housing authority could properly be said to include the regulating and controlling of the parking of vehicles on housing estates in order to safeguard and improve the amenity of life for tenants and to facilitate their access to, and enjoyment of, their houses and flats; and that, accordingly, pursuant to its powers under section 21(1) of the 1985 Act and section 111(1) of the 1972 Act, the local authority had had the power to introduce and operate the parking scheme without the need to pass any by-laws. (WLR)






PRACTICE


Parties - application to add party after expiry of limitation period to correct error - court having discretion to grant application where interests of justice so requiring

Morgan Est (Scotland) Ltd v Hanson Concrete Products Ltd: CA (Lords Justice Jacob and Hooper): 17 February 2005


Company A was the original contractor and purchaser of pipes from the defendants. It suffered damages as a result of the defendants' breach of contract. Company A's cause of action was assigned to company B, which assigned it to company C.


Shortly before the expiry of the limitation period company B issued the proceedings asserting that the original pipe supply contract was between B and the defendants and that B was the company which had the trouble with the defective pipes and suffered the consequential loss and damage. The defendant denied any contract with company B.


After the expiry of the limitation period B obtained an order from the High Court to add companies A and C as additional claimants. The defendants appealed, contending that the order of the High Court was wrong and contrary to the strict rule established in The Sardinia Sulcis [1991] 1 Lloyd's Rep 201, that the court should refuse to add or substitute parties after the expiry of the limitation period.


William Norris QC and Benjamin Pilling (instructed by Vizards Wyeth, London) for the defendant; Andrew Bartlett QC and Paul Reed (instructed by Kennedys, London) for the claimants.


Held, dismissing the appeal, that The Sardinia Sulcis was not relevant to the construction of the provisions of the Civil Procedure Rules 1998 (CPR) for amending and adding, or substituting, parties; and that under those provisions, which had been made in accordance with section 35 of the Limitation Act 1980, and by virtue of the overriding objective in CPR rule 1.1 to do justice to the parties, the court had a discretion to allow the addition of new parties after the expiry of the limitation period where the interests of justice so required. (WLR)






PROFESSION


Solicitor taking charge over client's property as security for fees then claiming lien over money received in settlement of action - lien not thereby waived unless previous security inconsistent with lien - agreement to use settlement moneys first to pay fees giving rise to equitable charge in solicitor's favour

Clifford Harris & Co v Solland International Ltd and others: ChD (Mr Christopher Nugee QC sitting as a deputy High Court judge): 11 February 2005


During previous litigation in which the claimant firm of solicitors had acted for the defendants, the defendants had given a second charge to the firm over their house, which included provision for interest at 8%. After those proceedings had been compromised, the parties agreed that any money received in settlement of the claims would be first used for legal costs. Eventually, a sum of money was paid over to the defendants in settlement of the action, but was not used to pay the outstanding legal costs.


The claimant firm issued proceedings claiming a charge under section 73 of the Solicitors Act 1974 over the settlement money as money recovered through their instrumentality. The defendants submitted that, by taking the earlier security over the house, the firm had waived its right to apply for the charge on the settlement money.


Sarah Harman (instructed by Clifford Harris & Co, London) for the firm; Philip Marshall QC (instructed by Bird & Bird, London) for the defendants.


Held, allowing the claim, that where a solicitor had taken alternative security for his costs from a client, he would only be held to have waived a lien claimed over a separate sum of money if the previous security was inconsistent with the lien; that, since a solicitor was, in general, not entitled to charge interest on his bills without a specific agreement to the contrary, and the rate of interest provided for in the charge was markedly higher than would ever be allowed by the court, the section 73 right had been waived by the firm by the taking of the charge; but that the agreement between the parties that the settlement money would first be used to discharge the firm's costs amounted to an equitable charge in favour of the firm over that money and an order under section 73 would be made.






SOCIAL SERVICES


Income support with severe disability premium - entitlement to premium dependent on claimant receiving disability living allowance - claimant failing to tell income support office when entitlement to allowance ceased - overpayment recoverable

Hinchy v Secretary of State for Work and Pensions: HL (Lord Hoffmann, Lord Hope of Craighead, Lord Scott of Foscote, Lord Walker of Gestingthorpe and Baroness Hale of Richmond): 3 March 2005


The claimant received income support which included a severe disability premium payable because she was in receipt of disability living allowance. Income support and disability living allowance were administered by different offices of the Department of Work and Pensions. The disability living allowance was for a fixed period which expired and was not renewed. The claimant did not inform the income support office that she was no longer receiving the allowance and payment of the premium continued. Subsequently, the Benefits Agency sought recovery of the overpayments under section 71 of the Social Security Administration Act 1992, which entitled the secretary of state to recover any benefit payment made as a result of a failure to disclose any material fact pursuant to regulation 32 of the Social Security (Claims and Payments) Regulations 1987 (SI 1987/1968).


The claimant's appeals to the Social Security Appeal Tribunal and a Social Security Commissioner were dismissed. However, the Court of Appeal allowed her appeal on the ground that the information as to the disability living allowance was within the knowledge of the secretary of state acting through the decision-makers in the disability living allowance office and, in the circumstances, there had been no need for her to give the information to the secretary of state's decision-makers in the income support office. The secretary of state appealed.


Richard Drabble QC and Daniel Kolinsky (instructed by the solicitor, Department for Work and Pensions) for the secretary of state; John Howell QC (instructed by the Child Poverty Action Group, London) for the claimant.


Held, allowing the appeal (Lord Scott dissenting), that regulation 32 imposed a duty to furnish 'in such manner ... as the secretary of state may determine ... such information or facts affecting the right to benefit or to its receipt as the secretary of state may require'; that the secretary of state had specified by the notes in the income support order book what information, including changes in other benefits, had to be furnished and that it had to be done by sending it to the office named on the cover of the book; that, consequently, disclosure had to be made to the relevant official and not to the secretary of state as an abstract entity; that the claimant was not concerned or entitled to make any assumptions about the internal administrative arrangements of the department; that, in particular, she was not entitled to assume the existence of infallible channels of communication between one benefit office and another; that, accordingly, the claimant's duty was to comply with the simple instruction in the order book and make disclosure to the person or office identified to her as the decision-maker and the latter was not deemed to know anything which he did not actually know. (WLR)






TAXATION


Value added tax - package for supply of cable television programme and television magazine - magazine supplied under separate contract and accordingly zero-rated

Telewest Communications Plc and another v Commissioners of Customs and Excise: CA (Lord Justice Kennedy, Lady Justice Arden and Sir Christopher Staughton): 10 February 2005


The first taxpayer, which owned about 28 regional television companies for providing programmes by cable, set up a package scheme whereby the regional companies contracted with customers on its behalf for the provision of television programmes and on behalf of the second taxpayer, a subsidiary of the first, for the supply of a monthly cable television magazine for a separate charge.


The monthly subscription for the package was collected by the companies, including the magazine charge which they passed on to the second taxpayer. The commissioners claimed VAT on the subscription payable in respect of the magazines on the basis that the contract was for the whole package so that VAT was chargeable on the total subscription for the package. The VAT tribunal and the High Court held that the contract was a single contract with the television companies and the subscription for the entire package was subject to VAT. The first taxpayer appealed.


David Milne QC and Fredick Philpott (instructed by Deloittes, accountants, London) for the taxpayers; Christopher Vadja QC and Ian Hutton (instructed by the solicitor, Customs and Excise) for the commissioners.


Held, allowing the appeal, that for each customer there were two contracts, one between the regional company and its customer for television services and another between the second taxpayer and the customer for the supply of the magazine; that, as a matter of community law, the concept of 'supply' was the 'transfer of the right to dispose of tangible property as the owner'; that the second taxpayer supplied the magazines on the contractual documentation made on its behalf; and that, accordingly, the supply of the magazine was a separate, zero-rated supply.






TORT


Buyer of company's shares agreeing to exclude liability for negligence of company's agents in relation to information supplied - actuarial valuation of company pension scheme failing to disclose gross deficiency in scheme - actuary not liable for negligent misrepresentation

Precis (521) plc v William M Mercer Ltd: CA (Lords Justice Kennedy and Laws and Lady Justice Arden): 15 February 2005


A holding company of the claimant, which was contemplating acquiring the shares in S plc, entered into a confidentiality agreement purporting to exclude any liability for the negligence of S's agents in relation to any information supplied to the holding company.


The holding company's solicitors served a questionnaire seeking information about S's pension scheme. S sent the questionnaire to the defendant and one of its employed actuaries who was the acting scheme actuary for the pension scheme; the scheme actuary provided written answers and sent certain documents, including a copy of the actuarial report of the defendants, to the holding company.


In reliance on the report the holding company, through the claimant, purchased the issued shares in S. When the claimant discovered that the actuarial report had failed to disclose a gross deficiency in the pension scheme it brought an action against the defendant claiming damages for negligent misrepresentation. The judge dismissed the claim. The claimant appealed.


Andrew Sutcliffe QC and William Edwards (instructed by DLA, Leeds) for the claimant; John Wardell QC and Joanna Smith (instructed by Nicholson, Graham & Jones, London) for the defendant.


Held, dismissing the appeal, that, although the precise limits of the concept of assumption of responsibility were still developing and there was no comprehensive lists of guiding principles to help the courts determine when the maker of a misrepresentation was to be held to have assumed responsibility for it, the defendant was not to be taken to have assumed responsibility since the holding company, without procuring its own actuarial report, had chosen to rely on the defendant's report after agreeing with S not to hold its agents liable for any negligence; and that it would not be fair, just or reasonable to impose liability in those circumstances.