King, Asplin and Zacaroli LJJ
Landlord and tenant – Adverse possession – Abuse of process – Family dispute concerning ownership of leasehold flat – Appellant seeking possession of flat occupied by respondent – Respondent claiming adverse possession – County court ruling that respondent precluded from claiming adverse possession as abuse of process – High court overruling decision – Appellant appealing – Whether adverse possession claim abuse of process – Appeal allowed
In 1978, the appellant purchased a two-bedroom flat at 7 South Lodge, 245 Knightsbridge, London on a 150-year lease. At the time of the purchase, the appellant was living in Pakistan. His brother (the respondent), who lived in London, assisted with the completion of the purchase.
In 1987, the respondent locked the appellant out of the flat. He claimed that he was entitled to reside there as it had been purchased by a family partnership and allocated to him as part of his partnership share. The appellant paid the service charges due under the lease but the respondent remained in sole physical control of the flat thereafter.
Landlord and tenant – Adverse possession – Abuse of process – Family dispute concerning ownership of leasehold flat – Appellant seeking possession of flat occupied by respondent – Respondent claiming adverse possession – County court ruling that respondent precluded from claiming adverse possession as abuse of process – High court overruling decision – Appellant appealing – Whether adverse possession claim abuse of process – Appeal allowed
In 1978, the appellant purchased a two-bedroom flat at 7 South Lodge, 245 Knightsbridge, London on a 150-year lease. At the time of the purchase, the appellant was living in Pakistan. His brother (the respondent), who lived in London, assisted with the completion of the purchase.
In 1987, the respondent locked the appellant out of the flat. He claimed that he was entitled to reside there as it had been purchased by a family partnership and allocated to him as part of his partnership share. The appellant paid the service charges due under the lease but the respondent remained in sole physical control of the flat thereafter.
The appellant brought an action for possession of the flat which was later stayed. In 2012, the respondent’s application for the stay to be lifted was refused. In 2018, he commenced a new possession claim. The respondent counter-claimed arguing, amongst other things, that he had acquired title by adverse possession.
Giving judgment in the new claim, the county court held that the respondent could not rely on adverse possession, as it would be an abuse of the process of the court, because the respondent told the court at the 2012 hearing that there would be no adverse possession defence if the appellant started a new claim.
The High Court overruled that decision, holding that the respondent was not precluded on the grounds of abuse of process from bringing his adverse possession claim: [2023] EWHC 59 (Ch). The appellant appealed.
Held: The appeal was allowed.
(1) Where a party to litigation had obtained a judgment or order on the basis of a particular position taken in the litigation, the court had the power to prevent that party from resiling from that position where it would cause injustice to the other party and undermine the integrity of the judicial process. The question whether a person was precluded from advancing a position in one case, where they had advanced the opposite in an earlier case, was to be approached by means of a broad, merits-based assessment, and was not constrained by strict rules (as, for example, issue estoppel). Ultimately, the label was unimportant. The form of estoppel by conduct in issue could readily be seen as a species of abuse of process.
It was material to ask whether it was apparent that the earlier decision was obtained on the footing of, or because of, the stance taken by the party in the earlier proceedings. Absent that factor, whilst the change of position might affect the credibility of the party or the witness concerned, there would not be an impression that one or other court was misled into giving its decision, so that the administration of justice risked being brought into disrepute: LA Micro Group (UK) Ltd v LA Micro Group Inc [2022] 1 WLR 336 applied.
(2) A party’s later position had to be clearly inconsistent with its earlier position. The court might enquire whether the party had succeeded in persuading a court to accept the party’s earlier position, so that judicial acceptance of an inconsistent position in later proceedings would create the perception that either the first or second court was misled. The court might ask whether the party seeking to assert an inconsistent position would derive an unfair advantage or impose an unfair detriment on the opposing party if not estopped: New Hampshire v Maine 532 US 742 considered.
Where the decision at first instance consisted of an evaluative judgment based on the balancing of factors, an appellate court would be reluctant to interfere with the decision of the judge in the judgment he reached on abuse of process by the balance of those factors; it would generally only interfere where the judge had taken into account immaterial factors, omitted to take account of material factors, erred in principle or come to a conclusion that was impermissible or not open to him: Aldi Stores Ltd v WAP Group Plc [2007] PLSCS 244; [2008] 1 WLR 749 applied.
(3) The key questions here were whether the respondent had adopted clearly inconsistent positions, and whether the court on the prior occasion acted on the footing of the position the respondent then adopted. As a matter of principle, there was no reason to impose a further requirement that the respondent expressed his earlier position by an objectively unequivocal statement.
The county court was entitled to conclude that the respondent had adopted clearly inconsistent positions, based on its finding that he intended to, and did, convey to the court in 2012 that he would not make a claim in adverse possession as part of his strategy to dissuade the court from lifting the stay on the 1987 action.
If a party set out to persuade the court that it held a certain position, the court was so persuaded, and the court acted on the footing that the party held that position, then that created the risks of unfairness and of bringing the administration of justice into disrepute, which underpinned the estoppel by conduct principle, if that party subsequently adopted the opposite position. That was sufficient to demonstrate “clearly inconsistent” positions, without the need for an objectively unequivocal statement on the earlier occasion.
(4) The fact that the appellant could bring a new claim seeking possession, without prejudice to himself because such a claim would not be faced with an adverse possession claim, was a pertinent factor. It was a reason to give the merits of the appellant’s case very little weight. It was a factor in concluding that considerations of the administration of justice favoured issuing new proceedings and an important factor in considering the effect of granting relief on each party. The appeal court was not satisfied that the only decision the judge could have reached in 2012, even without the respondent having taken the position he did, was to refuse to lift the stay. The county court’s decision did not fall outside the broad ambit within which reasonable disagreement was possible. There was no basis, applying the test in the Aldi Stores case, for interfering with its evaluative judgment. Acccordingly, the appeal on the question of abuse of process would be allowed.
Thomas Munby KC and James Kinman (instructed by Stephenson Harwood LLP) appeared for the appellant; Stephen Jourdan KC (instructed by Spencer West LLP) appeared for the respondent.
Eileen O’Grady, barrister
Click here to read a transcript of Malik v Malik
