CIVIL PROCEDURE

Conflict of laws - claim forms - dispensing with service - jurisdiction - pending actions - service out of jurisdiction

(1) Frieda Nussberger (2) Galerie Nefer AG v (1) Jonathan Guy Anthony Phillips (2) Robert Andrew Harland (suing as administrators of the estate of Christo Michaelidis): CA (Civ Div) (Lords Justice Pill, Neuberger and Wilson): 19 May 2006



The appellants (F and G) appealed against the decision ([2005] EWHC 1880 (Ch)) that the English court could entertain proceedings against them despite the existence of proceedings brought in Switzerland by the appellants against the English claimants (P).


P had issued proceedings against F and G, who were resident in Switzerland, and arranged for them to be served in Switzerland through official channels, in accordance with the Hague Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters 1965. The documents transmitted for service were served on F except the copy claim form, which a Swiss court official removed from the package because it was erroneously stamped not for service out of the jurisdiction. F and G then began Swiss proceedings against P seeking declarations of non-liability and their case was that those proceedings took priority under article 21 of the Lugano Convention 1988 because the Swiss court was seised of the proceedings when they were issued, whereas the English court was only seised when they were served and the English claim form had not been served.


On P's application, the judge ruled that service of the claim form could be dispensed with under rule 6.9 of the Civil Procedure Rules 1998 (CPR) and that, by virtue of rule 3.10, service was validated and the English proceedings took priority over the Swiss proceedings under article 21 of the convention.


P argued that the English court was seised of the proceedings when the documents for service were delivered to the Senior Master for service in accordance with the convention; rules 6.9 and 3.10 could be invoked to cure the failure to serve the claim form on F.


John Martin QC, Thomas Lowe (instructed by Withers) for the appellants; Alan Steinfeld QC, Richard Millett QC, Jessica Chappell (instructed by Lane & Partners) for the respondents.


Held, for the purposes of the instant case, the English court first became seised of proceedings when they were served (Dresser UK Ltd v Falcongate Freight Management Ltd [1992] 2 WLR 319 and Neste Chemicals SA v DK Line SA [1994] 3 All ER 180, applied).


There was reason to think that that rule might be reconsidered by the House of Lords in an appropriate case (Canada Trust Co v Stolzenberg [2002] 1 AC 1, considered). The provisions of CPR part 6 clearly showed that a foreign defendant was not served with documents under the Hague Convention until he received those documents.


Apart from the international dimension, the instant case was one in which rule 6.9 could have been invoked on the very unusual facts. However, it was not permissible to use the discretion under rule 6.9 to take back priority, for the purposes of article 21, from the Swiss proceedings. P could not invoke rule 6.9 to enable the proceedings to win a race that had already been won by the Swiss proceedings (Grupo Torras SA v Sheikh Fahad Mohammed Al Sabah [1995] CLC 1025; Molins plc v GD SpA [2000] 1 WLR 1741; Knauf UK GmbH v British Gypsum Ltd [2001] EWCA Civ 1570; [2002] 1 WLR 907; Tavoulareas v Tsavliris [2004] EWCA Civ 48; [2004] 2 All ER (Comm) 221 and Shiblaq v Sadikoglu (No2) [2004] EWHC 1890 (Comm); [2005] 2 CLC 380, considered).


Rule 3.10 could not help P's case in relation to the service of the copy claim form because it did not have the effect of treating the document as fictionally having been served. If relief were granted under rule 6.9, it would not achieve the intended purpose of giving the proceedings priority under article 21. Even if rule 6.9 would be effective for that purpose, it would be wrong to grant such relief since the circumstances were not exceptional, Knauf considered.


The English proceedings had to be stayed under article 21. Appeal allowed.





FAMILY


Ancillary relief - clean break - conduct - contributions - periodical payments orders - guidance provided by law lords

Miller v Miller; McFarlane v McFarlane: HL (Lord Nicholls of Birkenhead, Lord Hoffmann, Lord Hope of Craighead, Baroness Hale of Richmond, Lord Mance): 24 May 2006


H and W appealed against decisions of the Court of Appeal ([2005] EWCA Civ 984; [2006] 1 FLR 151 and [2004] EWCA Civ 872; [2005] Fam 171) in respect of financial awards that had been made to them following the breakdown of their respective marriages.


H had been married for less than three years when he decided to end the marriage, having embarked on a relationship with someone else. He had been extremely wealthy at the time of the marriage and had increased the value of his assets during the marriage. At the end of the marriage, his assets were worth approximately £17.5 million. He also held an unknown but substantial amount in shares, while his wife, were she to pay her outstanding costs, would have been more than £300,000 in debt.


An award of £5 million was made to his wife in the original proceedings and was upheld by the Court of Appeal on the grounds that his wife had a reasonable expectation of a high standard of living and that it was appropriate to take into account his conduct in initiating the break-up of the marriage.


W had been married for 16 years and had three children with her husband. W had agreed with her husband that she would give up her successful career as a solicitor to look after their children while he focused on his career. A periodical payments joint lives order had been made by the district judge in W's favour in the sum of £250,000 a year, with £60,000 for the annual maintenance of the children.


On appeal by her husband, the sum of £250,000 was reduced to £180,000 on the basis that W did not need £250,000 but would be able to save and accumulate capital from that sum. The Court of Appeal restored the amount, holding that, in exceptional cases, periodical payments orders could be used as a means to enable the payee to accumulate capital. It did, however, reduce the order to a five-year order, on the ground that a joint lives order did not give due effect to the clean break principle.


James Turner QC, Philip Marshall (instructed by Sears Tooth) for the appellant Miller; Barry Singleton QC, Deepak Nagpal (instructed by Family Law in Partnership) for the appellant McFarlane; Nicholas Mostyn QC, Tim Bishop, Rebecca Harris (instructed by Withers) for the respondent Miller; Jeremy Posnansky QC, Stephen Trowell (instructed by Levison Meltzer Pigott) for the respondent McFarlane.


Held, the general principles to be applied when making financial awards were need, compensation and sharing. There could not be a hard and fast rule about whether the court should start with equal sharing and then depart if need or compensation supplied a reason for doing so, or whether the court should start with need and compensation and then share the balance.


Compensation was aimed at redressing any significant prospective economic disparity between the parties arising from the way in which they had conducted their marriage. For instance, the parties might have arranged their affairs in a way which had greatly advantaged the husband in terms of his earning capacity but left the wife severely handicapped so far as her own earning capacity was concerned. Then the wife suffered a double loss: a diminution in her earning capacity and the loss of a share in her husband's enhanced income.


The financial provision orders in section 23 of the Matrimonial Causes Act 1973 were intended to be flexible in their application. In particular, a periodical payments order could be made for the purpose of affording compensation to the other party, as well as meeting financial needs.


As to H's appeal, the general approach in the case of short marriages was to consider whether, and to what extent, there was good reason to depart from equality. Fairness could well require that a claimant should not be entitled to a share of the other's non-matrimonial property, reflecting the instinctive feeling that parties would generally have less call upon each other following the breakdown of a short marriage. It was of importance that the standard of living enjoyed by H and his wife during their marriage had been much higher than she had been accustomed to. However, hopes and expectations were not an appropriate basis for assessing financial needs. Conduct was a relevant issue, but the court should only have regard to it where 'it would... be inequitable to disregard it' pursuant to section 25(2)(g) of the 1973 Act.


In the instant case, it was inappropriate to take H's conduct into account. However, the increase to H's wealth during the period of the marriage was significant. The matrimonial property was of great value and the high standard of living enjoyed by H and his wife during their marriage was a key feature of the case. The awarded sum of £5 million was appropriate in what was an unusual case. The award represented less than one-sixth of H's total worth.


In making the original award of £250,000 to W, the district judge had allowed for an element of compensation to take into account the fact that, during the marriage, she had allowed her earning capacity to be greatly reduced by giving up her career to care for the children. The Court of Appeal appeared to have treated the surplus of income as simply a means whereby W could accumulate capital. That would be to mistake the purpose of that part of the district judge's award.


It was inappropriate, unjust even, to replace the joint lives order with a five-year order. It would be appropriate in the future, when W's husband had reduced his outgoings and W had revived her earning capacity, to reassess the parties' position and consider the possibility of a deferred clean break. However, it was more appropriate for W's husband to initiate such reassessment by applying for a variation of the joint lives order than to compel W to shoulder the burden of applying for an extension to the five-year order. The original joint lives order would be restored.


As to the approach to be adopted when evaluating the contributions that the parties had made to the welfare of the family, the parties should not seek to promote a case of 'special contribution' unless the contribution was so marked that to disregard it would be inequitable.


(Per Lord Nicholls) The principle of 'equal sharing' was applicable as much to short marriages as to long marriages. (Per Baroness Hale) If the relevant assets were not 'family assets', or had not been generated by the joint efforts of the parties, then the duration of the marriage might justify a departure from the yardstick of equality of division. It was necessary to recognise that, in a matrimonial property regime that still started with the premise of separate property, there was some scope for one party to acquire and retain separate property that was not automatically to be equally shared.


H's appeal was dismissed and W's allowed. Judgment accordingly.





EMPLOYMENT


Contract of employment - reasonableness - restrictive covenants - unfair dismissal - reason of a kind such as to justify dismissal - employee's refusal to sign new contract

Willow Oak Developments Ltd (T/A Windsor Recruitment) v Silverwood & ors: CA (Civ Div) (Lords Justice Buxton and Neuberger, Sir Martin Nourse): 25 May 2006


The appellant employer (W) appealed against the decision that it had unfairly dismissed the respondent employees (S).


W was a recruitment company that specialised in supplying agency workers for the health and associated services. At the same time as W was trying to expand, a number of staff had left to set up in competition with it. Accordingly, W sought to impose on its staff new and more demanding post-employment covenants.


S had been dismissed for refusing to accept the necessary variations of the contracts of employment. The employment tribunal found that there had been a lack of consultation and that S had not been told that failure to agree to the new terms might result in dismissal. The tribunal held that the covenants were so unreasonable that the refusal to accept them could not be a reason of a kind such as to justify dismissal within section 98(1) of the Employment Rights Act 1996, and that in any event W had acted unreasonably in treating the failure to accept the covenants as a sufficient reason for the dismissal, which was therefore unfair under section 98(4) of the 1996 Act.


The Employment Appeal Tribunal (EAT) reversed the employment tribunal's first conclusion, but upheld its alternative conclusion, and declined to remit the matter to the employment tribunal.


W submitted that the employment tribunal had not been entitled to find that the dismissal was unfair on its alternative ground under section 98(4) because it had not succeeded in putting out of its mind its erroneous conclusion under section 98(1); because it was impossible to tell what view the tribunal would have taken of the unreasonableness of the covenants on the assumption that they did not fall foul of section 98(1), and because the decision gave no weight to a period of consideration which had been afforded to S.


Helen Mountfield (instructed by Gaby Hardwick) for the appellant; David Jones (instructed by Chadwick Lawrence) for the respondents.


Held, the EAT had been entitled to disagree with the employment tribunal's first conclusion that an unreasonable covenant could not count as a reason that came within the terms of section 98(1). The language of section 98(1) clearly indicated that the question was whether the reason for dismissal fell within a category of reasons that was not excluded by law as a ground for dismissal. If, as in the instant case, the category into which the reason fell was one that could in law form a ground for dismissal, then it was necessary to proceed to the second stage of considering whether the employer had, under section 98(4), acted reasonably in treating that reason as a sufficient reason for dismissing the employee (Forshaw v Archcraft Ltd [2006] ICR 70, disapproved).


Whether the tribunal's alternative conclusion was genuinely independent was a matter of construing the terms of the tribunal's determination. The tribunal had put its conclusion on section 98(1) out of its mind when it turned to section 98(4). There was an independent conclusion by the tribunal as to the unfairness of the procedure adopted by W (Scott & Co v Richardson (unreported, 26 April 2005), distinguished).


The tribunal had clearly found the procedure adopted by W to have been so unfair that the dismissals would have been unfair whether or not the covenants themselves were reasonable, Catamaran Cruisers v Williams [1994] IRLR 386, distinguished. The tribunal had properly assessed the fairness of the procedure. It had been entitled to find that the covenants had been introduced in an unreasonable way and that there had been no warning that failure to agree to the new terms might result in dismissal. That last fact alone justified a finding that the dismissals had been procedurally unfair.


Based on the findings of the tribunal, a remission of the case would produce the same result and, therefore, would not be appropriate. Appeal dismissed.





PROPERTY


Commons - land registration - local authorities powers and duties - statutory interpretation - village greens

Oxfordshire County Council v (1) Oxford City Council (2) Catherine Mary Robinson: HL (Lord Hoffmann, Lord Scott of Foscote, Lord Rodger of Earlsferry, Lord Walker of Gestingthorpe, Baroness Hale of Richmond): 24 May 2006


The appellant (R) appealed against a decision ([2005] EWHC Civ 175; [2006] Ch 43)) giving guidance on issues arising from her application under the Commons Registration Act 1965 for registration of land owned by the local authority as a town or village green.


R had applied for registration of the land as a 'class c' green within section 22(1A) of the 1965 Act, on the basis that local residents had used the land for lawful pastimes as of right for an unbroken period of 20 years and continued to do so. A non-statutory inquiry confirmed that such use had been made of the land and made a recommendation to the local authority to register the land as a village green.


The local authority objected to R's application and sought the directions of the court. The issues for determination were the meaning of the words 'continue to do so' in section 22(1A) and whether the lawful sports and pastimes had to continue up to the date of the application to register or beyond; the effect of registration in terms of potential rights obtained by local inhabitants to prevent nuisance and encroachment on the village green; the extent of the power of the registration authority to allow amendments to the application form and to register an area of land different from that originally claimed; and the correct approach to the statutory question as to whether 'a significant number' of the inhabitants of a locality or a neighbourhood 'indulged in lawful sports and pastimes as of right'.


Charles George QC, Philip Petchey (instructed by the local authority solicitor) for Oxford City Council; Douglas Edwards, Jeremy Pike (instructed by Public Law Solicitors) for Robinson; George Laurence QC, Ross Crail (instructed by the local authority solicitor) for Oxfordshire County Council.


Held, (Lord Scott dissenting on the issue of the definition of 'town or village green' and how it should be applied) to satisfy the definition of a 'town or village green' for the purposes of section 22(1A), the inhabitants of the locality must 'continue' to use the land for sports and pastimes for a period of 20 years until the date of the application for registration under the 1965 Act. A construction that favoured continued use until the date of registration would make nonsense of the Act by giving the landowner an opportunity to prevent continued use during the application stage (R (on the application of Cheltenham Builders Ltd) v South Gloucestershire DC [2003] EWHC 2803; [2003] 4 PLR 95, considered).


The natural construction of section 10 of the Act was that a registered town or village green could be used generally for sports and pastimes. Parliament must have thought that if the land had to be kept available for one form of recreation, it would not matter a great deal to the owner whether it was used for others as well. The primary purpose of the 1965 Act, in its application to village greens, was not to create new rights that overrode those of the owner, but to create a register of town and village greens that would include all land over which statutory or customary rights of recreation existed. It was a necessary implication that land conclusively presumed to be a village green should be subject to the rights that the statute treated as creating a village green, namely the right to indulge in sports and pastimes (R v Suffolk County Council, ex parte Steed (1988) 75 P&CR 102 and R v Norfolk County Council, ex parte Perry (1997) 74 P&CR 1, considered).


Furthermore, the owner of the land retained his title to the land and his right to use it in any way that did not prevent its use by the inhabitants for recreation, and the system of registration had been brought about to preserve open spaces in the public interest (JA Pye (Oxford) Ltd v United Kingdom (44302/02) 19 BHRC 705, distinguished).


The registration authority should be guided by the general principle of fairness to the parties. It would be pointless to insist upon a fresh application where no prejudice would be caused by an amendment. Furthermore, the registration authority was entitled, without any amendment of the application, to register only that part of the subject premises that the applicant could prove to have been used for the necessary period.


The court would not provide guidance on the correct approach to the evidence, as that would be inevitably construed as if it were a supplementary statute. There was a clear statutory question and every case would depend on its own facts.


Therefore, R was entitled to declarations that registration of the land would give rise to rights for the relevant inhabitants to indulge in lawful sports and pastimes on the land, and that, for the purposes of section 22(1A), the use for sports and pastimes had to continue until the date of the application for registration. Judgment accordingly.





INTELLECTUAL PROPERTY


Civil procedure - estoppel - interim injunctions - non-parties - restitution - undertakings - entitlement to recover under cross-undertaking in damages - restitutionary claims - loss of business opportunity - unjust enrichment

(1) Smithkline Beecham plc (2) Glaxosmithkline UK Ltd (3) Glaxo Group Ltd (claimants/ respondents on the cross-undertaking) v (1) Apotex Europe Ltd (2) Neolab Ltd (3) Waymade Healthcare plc (defendants/claimants on cross-undertaking) (4) Apotex Inc (A company incorporated under the laws of Canada) (5) Apotex Pharmachem Inc (formerly named Bradford Chemicals Inc) (A company incorporated under the laws of Canada) (additional claimants on the cross-undertaking): CA (Civ Div) (Sir Andrew Morritt C, Lords Justice Moore-Bick and Jacob): 23 May 2006


The appellant companies (X) appealed against the decision ([2005] EWHC 1655 (Ch)) that their claims in restitution and third-party loss had no real prospect of success. The respondent companies (S) cross-appealed against the decision that a claim in estoppel was arguable and should go to trial.


The underlying litigation concerned the validity and infringement of S's patent for a pharmaceutical product. An interim injunction was made that X would not deal in any similar pharmaceutical preparation and, in return, S gave a cross-undertaking in damages. The patent was found valid but not infringed (see Smithkline Beecham plc v Apotex Europe Ltd [2004] EWCA Civ 1568.


X and the Canadian manufacturers of its products, who sought to be added as parties to the action, sought to claim damages on the cross-undertaking. The judge determined that the Canadian companies were not entitled to recover in restitution the losses they had sustained, and that X was not entitled to claim the losses of the Canadian companies as third-party losses under the cross-undertaking. The judge also concluded that the claim that S were estopped from denying that the Canadian companies were entitled to claim their losses under the cross-undertaking would involve a mini-trial and should not be struck out summarily.


The Canadian companies argued that they were entitled to recover in restitution that part of S's extra profits that would have been made by the Canadian companies if the interim injunction had not been made, and that the court had power to ensure that a litigant, who had used its process to gain an advantage and then lost on appeal, would be obliged by the court to disgorge that benefit to a party adversely affected by the 'wrongful order'.


X argued that a party identified in the cross-undertaking as one whom the injunctor would compensate could claim compensation not only for itself, having been prevented from doing the restrained acts, but also for others who were adversely affected by the injunction.


S argued that an inter-partes estoppel could not operate to expand or contract the effect of a court order, an estoppel could not be used as a key element of a claim and could not operate to create a legal relationship where there was none and, in any event, the material pleaded was inadequate to justify estoppel.


Andrew Waugh QC, Marcus Smith, Geoffrey Pritchard (instructed by Simmons & Simmons) for the claimants/respondents on the cross-undertaking; Nicholas Straus QC, Alain Choo Choy, Thomas Mitcheson (instructed by Taylor Wessing) for the defendants/claimants on the cross-undertaking.


Held, there was no possible rational basis for a third party to have a claim in restitution in respect of benefits that accrued to a 'wrongful' injunctor. No action lay by a party, save for very limited exceptions in the nature of abuse of process, for recompense for damage caused by litigation itself. It was inconceivable that a non-party could have such a claim (Palimport v Ciba Geigy (23 December 1974); Roger v The Comptoir d'Escompe de Paris (1871) LR 3 PCV 465; Arkadelphia Milling v St Louis Southwestern Rly (1918) 249 US 134 (Supreme Court) and National Australia Bank v Bond Brewing Holdings (1991) 1 VR 386, considered). The judge was right to strike out the restitution claim.


An undertaking was given to the court to compensate the parties identified in the undertaking. There was no contract between the parties. Even if there were a contract, the principles expounded in the cases did not, and could not, be expanded to cover the kind of third-party loss sought to be recovered in the instant case.


The undertaking was given to the court, not to the defendants. Whatever passed between the parties could not affect the scope of what was actually undertaken or the scope of the injunction. The Canadian companies were seeking to use estoppel to create a legally binding agreement where there was none and no intention to create one, which estoppel could not do.


The pleaded documents did not support the estoppel and there was no justification to support the averments of a common assumption or a representation by S that the Canadian companies were to be treated as parties. The judge was wrong to dismiss the application to strike out the estoppel claim on the basis that it would have involved a mini-trial. Appeal dismissed, cross-appeal allowed.




Confusion - deception - domain names - goodwill - infringement - passing off - trade marks - inference of deception - kinds of damage to goodwill - mobile telephones - misrepresentations

(1) Phones 4u Ltd (2) Caudwell Holdings Ltd v (1) Phone4u.co.uk Internet Ltd (2) Abdul Heykali (3) New World Communications (Southern Division) Ltd: CA (Civ Div) (Lords Justice Tuckey, Carnwath and Jacob): 19 May 2006


The appellant mobile telephone companies (C) appealed against a decision ([2005] EWHC 334 (Ch)) dismissing their claim against the second respondent (H) for passing off or for infringement of a registered trade mark.


C were well-known mobile phone retailers that had, as a registered trade mark, a red, white and blue logo containing the words 'phones 4u' in stylised form and the registered domain name 'phones4u.co.uk'. H had registered and used the domain names and e-mail addresses 'phone4u.co.uk' and 'phone4u.com' in the same year as C registered its domain name.


The trial judge found that, on the evidence, C had not acquired the goodwill in the expression 'phones 4u' to found a passing-off action at the time that H registered the domain name, and that there had only been confusion and not deception in H's use of that domain name. The trade mark infringement failed because the judge found that C's mark was limited to the combination of red, white and blue colours.


C submitted, in relation to the passing-off claim, that the judge applied the wrong test in deciding whether, at the operative date, C had a goodwill protectable by passing off; at the date of first registration of 'phone4u.co.uk', an instrument of fraud within the meaning of Marks & Spencer plc v One in a Million Ltd [1999] 1 WLR 903, was created; the judge wrongly characterised a large number of instances of deception as 'mere confusion'; the judge erred in placing significance in co-existence for five years without 'deception' without first considering the extent of H's use during that time.


C submitted, in relation to the trade mark claim, that there was no limitation on the rights conferred by registration such that there could only be infringement if the mark was used in colour.


Richard Miller QC, Michael Hicks (instructed by Eversheds) for the appellants; Lindsay Lane (instructed by Bird & Bird) for the respondents.


Held, to infer, as the judge had, from the evidence available that at the date of H's domain name registration, hardly anyone knew the 'phones 4u' name was untenable. The judge had erred by seeking to apply the test for distinctiveness required for registration of a trade mark, which was a much higher standard. It was enough that very large numbers of people knew the name, far more than that needed to establish goodwill.


The second error followed automatically from the first. Since the inevitable inference was that 'phones 4u' had an established goodwill at the relevant time, the court did not see how there could be any realistic use of 'phone4u.co.uk', albeit created innocently, without causing deception. Moreover, since it appeared not to have been actually used for trade until about the same time or more probably after H knew of the shops, his conduct in trying to sell the domain name was not materially different from that of the defendants in Marks & Spencer plc v One in a Million Ltd.


E-mails in evidence from customers to H's Web site showed that those customers thought they were communicating with those who owned and ran the Phones 4u shops and a significant number thought so even after having visited H's Web site. The Web site itself was not enough to 'undeceive' those persons and H had sought to take advantage of the initial deception. The e-mail evidence showed clear and convincing evidence of damage to goodwill. The judge had fallen into error by limiting himself to considering damage by trade diversion and not considering the other kinds of damage to goodwill protected by the law of passing off.


H's evidence simply did not establish enough material to draw the inference of no deception and there was no justification for the inference of non-deception drawn by the judge. The e-mail evidence did show instances of damaging misrepresentation and passing off was established.


There was no doubt that what was sought by C and granted was a mark only in colour and the evidence showed that C had accepted a limitation within the meaning of section 13 of the Trade Marks Act 1994 to a mark only in colour. Therefore, the claim for infringement of trade mark failed. Appeal allowed in part.





LANDLORD AND TENANT


Local government - date of termination - postponement - prescribed forms - secure tenancies - suspended possession orders - tolerated trespass - power to make order for postponement of possession

Bristol City Council v Mohamud Hassan & anor; Bristol City Council v Jane Glastonbury: CA (Civ Div) (Lords Justice Brooke (Vice-President), Dyson and Jacob): 23 May 2006


The appellant tenants (T) appealed against the form of suspended possession orders.


T were two secure tenants who were in arrears with their rent. The local authority sought suspended possession orders on terms that T paid modest instalments towards the arrears. There was no dispute that possession orders could be made.


T's case was that, rather than insert a date for possession to be given in the standard form N28 and suspend the effect of the order on terms, the court should order T to give possession on a date to be fixed on application by the local authority. The effect of the order in the first form would be to terminate the tenancies on the date for possession under section 82(2) of the Housing Act 1985 and reduce T to the status of tolerated trespassers, whereas T would remain tenants under the second form of order. The district judges made possession orders in the usual form on the basis that they were required to fix a date for possession on the face of the order.


The local authority submitted that the court could not lawfully make an order postponing the date of possession and continuing the tenancy in the meantime. T submitted that to avoid the unsatisfactory status of tolerated trespasser, the court should make a 'conditional' possession order, which provided that the date for possession was only to be fixed by the court on a further application by the landlord.


Jan Luba QC, Robert Latham (instructed by South West Law) for the appellants; Kelvin Rutledge, Genevieve Screeche-Powell (instructed by the local authority solicitor) for the respondent.


Held, there was nothing in section 85 of the 1985 Act that fettered the discretion of a judge to make such order for postponement of possession as he thought fit. A judge was not obliged to set out a date for possession on the face of his order. It was lawful for him to make an order that set out a date for possession but provided that that date would be postponed and the tenancy would continue so long as the conditions set out in the order continued to be satisfied. The court would be postponing the date of possession for a fixed period in the first instance and, thereafter, for such period as the tenant complied with his obligations under the order. That fitted naturally with the language of section 85(2).


It would be undesirable to impose any procedure which would require a further hearing before a date for possession could be fixed, with all the attendant expense and delay that that might involve. It would be sufficient for possession to be postponed on terms that, if a landlord wished a date to be fixed, it had to write to the tenant giving details of the arrears and its intention to request a date to be fixed at least 14 days before it made that application. If the tenant did not respond, or if the landlord wished to apply for a date to be fixed notwithstanding the tenant's response, it would then be at liberty to apply to the court on a without-notice basis, requesting a date to be fixed. With its application, the landlord should submit to the court a copy of its letter and the tenant's response, if any, together with a copy of the rent account since the date of the order postponing possession. Other evidence would seldom be required and the application to fix the date on which the tenant was to give up possession could be determined on the papers without a hearing. The tenancy would continue until the court fixed the date for possession.


In the instant cases, the district judges fettered their discretion too narrowly. In each case, the district judge's order for possession and money would stand but the claims were remitted to the county court to determine what, if any, terms of postponement of possession were appropriate. Appeals allowed.