Landlord and tenant — Rent review clause — Arbitration — Further episode in the long-running litigation occasioned by the decision of Walton J in 1984 — Present application by tenants a fresh attempt to obtain a certificate under section 1(7)(b) of Arbitration Act 1979 and leave to appeal from Walton J’s decision — Application appeared unlikely to succeed and in fact failed — Knox J, however, in a lengthy judgment covered the important decisions in what has been described as the ‘Arthur Young saga’ including the parallel litigation in Arnold v National Westminster Bank plc
of clarity it is desirable to deal first with the present application — It will
be recalled that the effect of Walton J’s decision that the hypothetical lease
contained no provision for rent reviews was to increase the rent determined by
the arbitrator from £1,003,000 per annum to £1,209,000 per annum, an uplift of
some 20 per cent — Walton J refused an application for a certificate under
section 1(7)(b) of the 1979 Act and, consequentially, leave to appeal — The
Court of Appeal held that they had no jurisdiction to review the decision of a
High Court judge to refuse a certificate and as a result could not consider an
appeal — The present application, made more than five years after Walton J’s
decision, was a fresh attempt to obtain a certificate under section 1(7)(b) and
leave to appeal, the obtaining of the certificate being a condition precedent
to an appeal; the application, if successful, would have required also leave
from the Court of Appeal to appeal out of time — After referring to the scheme
and policy of the 1979 Act as interpreted by the House of Lords, Knox J
considered more technical objections to the present application — He concluded,
with the assistance of decisions on analogous problems arising in criminal law
and courts-martial legislation, including section 33 of the Criminal Appeal Act
1968 (the model for the 1979 Act), that only one application under section 1(7)(b)
of the 1979 Act was envisaged and that it had to be made within the time
limited for appealing — He rejected a submission that there was power to grant
a certificate long after the original decision and original refusal of an
application if the law had changed in the meantime — The suggested change in
the law was the judicial consensus that the decision of Walton J had been wrong
of a general review Knox J mentioned the various rent review decisions at first
instance in which a view contrary to that of Walton J had emerged and the
decisions of the Court of Appeal in Equity & Law Life Assurance Society plc
v
Bodfield Ltd and Basingstoke and Deane Borough Council v Host Group Ltd — He also
discussed the Arnold v National Westminster Bank plc line of authority in which an attempt
had been made to attack the problem in a different way — The tenants had sought
either rectification of the lease or in the alternative a determination as to
the true construction of the contentious rent review clause — The latter plea
was clearly an attempt to relitigate the exact construction point originally
determined by Walton J, although without any suggestion that the rent review
for 1983 to 1988 should be reopened — The landlords argued that such an attempt
fell foul of the issue estoppel rule — The Vice-Chancellor and subsequently the
Court of Appeal did not accept this argument, holding that the case fell within
an exception to the rule based on special circumstances — There was not total
identity in the way in which the three members of the Court of Appeal
formulated the ground for the exception, but clearly the essence of it was the
acceptance that the decision of Walton J had been plainly wrong
the actual application before Knox J, which was for an order that,
notwithstanding the decisions of Walton J in 1984, the tenants should be
granted a certificate under section 1(7)(b) of the 1979 Act, and leave to
appeal, the application had to be dismissed
The following
cases are referred to in this report.
Amax
International Ltd v Custodian Holdings Ltd
[1986] 2 EGLR 111; (1986) 279 EG 762
Antaios
Compania Naviera SA v Salen Rederierna AB
[1985] AC 191; [1984] 3 WLR 592; [1984] 3 All ER 229, HL
Arnold v National Westminster Bank plc [1988] 3 WLR 1229; [1988] 3
All ER 977; [1988] 2 EGLR 161; [1988] 45 EG 106; affirmed [1990] 2 WLR
304; [1990] 1 All ER 529; [1990] 1 EGLR 137; [1990] 01 EG 58, CA
Basingstoke
and Deane Borough Council v Host Group Ltd
[1988] 1 WLR 348; (1987) 56 P&CR 31; [1987] 2 EGLR 147; 284 EG 1587, CA
British
Gas Corporation v Universities Superannuation
Scheme Ltd [1986] 1 WLR 398; [1986] 1 All ER 978; (1986) 52 P&CR 111;
[1986] 1 EGLR 120; 277 EG 980
Datastream
International Ltd v Oakeep Ltd [1986] 1 WLR
404; [1986] 1 All ER 966; (1985) 51 P&CR 218; [1986] 1 EGLR 98; 277 EG 66
Equity
& Law Life Assurance Society plc v Bodfield
Ltd [1987] 1 EGLR 124; (1987) 281 EG 1448, CA
Pearl
Assurance plc v Shaw [1985] 1 EGLR 92;
(1984) 274 EG 490
Pioneer
Shipping v BTP Tioxide Ltd (‘The Nema’)
[1982] AC 724; [1981] 3 WLR 292; [1981] 2 All ER 1030, HL
Pugh v Smiths Industries Ltd (1982) 264 EG 823, [1982] 2 EGLR 120
R v Ashdown [1974] 1 WLR 270; [1974] 1 All ER 800
R v Grantham [1969] 2 QB 574; [1969] 2 WLR 1083; [1969] 2 All
ER 545; sub nom R v Grantham (Leslie Michael) 53 Cr App R 369,
Cts-Martial App Ct
Sweet v Parsley [1968] 2 QB 418; [1968] 2 WLR 1360; [1968] 2 All
ER 337
Warner v Metropolitan Police Commissioner [1969] 2 AC 256; [1968] 2
WLR 1303; [1968] 2 All ER 356, HL
Yeandel v Fisher [1966] 1 QB 440; [1965] 3 WLR 1002; [1965] 3 All ER
158, DC
In this notice
of motion by Arthur Young McClelland Moores & Co, the tenants under a
subunderlease of premises at 7 Rolls Buildings, off Chancery Lane, London EC4,
the applicants sought an order that they be granted a certificate under section
1(7)(b) of the Arbitration Act 1979 in relation to decisions of Walton J
in November 1984 and leave to appeal from the decisions.
James Munby QC
and Jonathan Gaunt (instructed by Freshfields) appeared on behalf of the
tenants; Terence Cullen QC and Miss Hazel Williamson QC (instructed by
Stephenson Harwood) represented the landlords.
Giving
judgment, KNOX J said: On October 28 1976 Charter Consolidated Services
granted a subunderlease to Arthur Young McClelland Moores of premises at 7
Rolls Buildings, Fetter Lane. The term was from October 28 1976 to June 24 2008
and the rent was initially one of £800,000 per annum. There were provisions for
review in the years 1983, 1988, 1993, 1998 and 2004. The review procedure
adopted involved what was called the ‘fair market rent’ and defined as:
. . . such
amount as shall represent a yearly rent at which the demised premises might
reasonably be expected to be let at the Relevant Review Date in the open market
by a landlord to a tenant without a premium with vacant possession and subject
to the provisions of this Sub-underlease other than the rent hereby reserved
there being disregarded any effect on rent of any of the matters set out in
paragraphs (a) (b) or (c) of Section 34 of the Landlord and Tenant Act 1954 (as
amended)
There was
provision for arbitration if the parties failed to agree, as they did, in
relation to the rent payable from midsummer quarter day in 1983. The main
subject of dispute was whether, under that definition of fair market rent which
I have read, the rent under the hypothetical lease had to be fixed on the basis
that it contained the same provisions for rent reviews as were contained in the
subunderlease itself or, on the other hand, contained no provision for review.
The arbitrator to whom the matter was referred decided that the hypothetical
lease should be treated as containing review provision, and on that basis he
fixed the rent at £1,003,000 per annum. But he also found what the rent would
be on the other view, namely that there was no rent review clause in the
hypothetical lease, and that rent he found at a figure some 20 per cent higher,
that is to say £1,209,000 per annum. So there was a difference, obviously, of
£206,000 per annum during the remainder of that review period.
At that stage
the landlords were the National Westminster Bank plc as trustee for British
Rail Pension Trustee Co Ltd and PosTel Properties Ltd, who, as their names
indicate, were pension organisations for British Rail and the Post Office
respectively. They were beneficially interested in equal shares.
The matter
proceeded on appeal before Walton J, who, on November 26 1984, gave a judgment
varying the arbitrator’s award*. The order was that the interim award be varied
by substituting therefore an award in the sum of £1,209,000 per annum as set
out in his alternative award.
*Editor’s
note: The case is reported at [1985] 1 EGLR 61.
In the course
of his judgment on this point, the learned judge said this at p 2, letter G:
The first and
I think probably the main question which arises here is whether, when the
arbitrator is deciding what is to be the fair market rent for the next rent
period, he is to do that upon the basis that the lease contains (as, of course,
we know it does in fact contain) a rent review clause or whether, on the other
hand, he is to fix the fair market rent on the basis that there is no such
clause in the lease. I do not think that there is a presumption one way or the
other. I think that in every case that must depend upon the precise terms of
the lease, because it must be very much borne in mind that there is no such
thing as a fair market rent of any premises in the abstract. There is only a
fair market rent upon a set of abstractions which may be actual, may be
hypothetical and in most cases under rent reviews are a mixture of the one and
the other. For example, here we have that the premises are expected to be let
with vacant possession, which is, of course, something which we know as a fact
just is not the case because the tenants are actually in possession and are
certainly not just going to move out for the purpose of a rent review. So the
attempt by Mr Morritt
— who, I
interpose, appeared for the tenants —
to poison my
mind in advance to achieve the lower of the two values by defining the fair
market rent as something which favours the tenant, as in fact he was attempting
to do, I do not think impresses me very much.
The learned
judge, having dealt with the question of whether there was a presumption one
way or the other, went on to find, as I have said, that the hypothetical lease
should not be treated as containing a rent review provision.
He was asked
for, and refused, a certificate under section 1(7) of the Arbitration Act 1979.
Section 1 of the Arbitration Act 1979 starts in subsection (1) by removing the
old jurisdiction to set aside or remit an award on the ground of errors of fact
or law on the face of the award, and the statement of cases, and substituted a
system of appeal. The next following subsections (2), (3) and (4) deal with the
first stage of the possible appeal, namely to the High Court. It is not
necessary to set those out in full. Subsections (5) and (6) deal with
supplementing awards by one means or another. Subsection (6)(a)
qualifies the rights of appeal in that context. It is (7) with which both this
application before me and the application that was made to Walton J on November
26 1984 is concerned. That reads:
No appeal
shall lie to the Court of Appeal from a decision of the High Court on an appeal
under this section unless —
(a) the High Court or the Court of Appeal gives
leave; and
(b) it is certified by the High Court that the
question of law to which its decision relates either is one of general public
importance or is one which for some other special reason should be considered
by the Court of Appeal.
At that point,
Mr Morritt, for the tenant, did mention that there had been cases referred to
either unreported or in the status, as he is recorded as having said, of judges
at first instance dealing with just this point, albeit on differently phrased
leases, but he said that the point had never been considered by the Court of
Appeal at all and that it was one that did seem to arise frequently in the
sense that there were five cases, four of which were reported in the Estates
Gazette and one not. And he submitted that it was a question of law which
Walton J could say was of general public importance and, perhaps more
importantly, was one which for some other special reason should be considered
by the Court of Appeal, namely that it had never been before. And he did
mention specifically the fact that Walton J had rejected the general principle
on the ground of seeking to poison Walton J’s mind, and said, not surprisingly,
that he would not put it that way, but would submit that it might well be
appropriate for the Court of Appeal to consider whether and to what extent they
should be bound by a hypothesis which is quite contrary to the facts.
Walton J
expressed the view that there did not seem to be any general question of law
arising because it was a question of construction of the individual lease.
Specifically he said at p 9, letter H:
It does seem
to me that if you will have documents drawn inter rusticos this is a
question of construction in every particular case. I cannot see any general
question of law which arises.
He refused to
grant a certificate, and of course it is perfectly clear on the face of section
1(7) that if there is no certificate there is no question of leave to appeal.
That
application for a certificate was renewed before this first order was passed and
entered. Of course before an order is passed and entered a judge has
jurisdiction to recall his order, and Walton J, when he heard the further
application on November 30, did again consider it. He also had before him quite
a volume of evidence concerning the extent to which the clause in question
resembled, and in respect of some words was identical to, other frequently used
precedents and clauses. Walton J rejected the second application or perhaps
more precisely the second presentation of the same application to him. He said
at p 2, letter D:
. . . the
additional evidence which Mr Morritt has now put in seems to confirm my belief
that this matter is not by any stretch of the imagination one of general public
importance. First of all, he says that clauses in this form have been going
since 1960. So be it. Rent reviews ever since 1960, or the majority of them,
have been quinquennial or at the most septennial. That gives a very large
number indeed of rent reviews which must have taken place on clauses of, according
to Mr Morritt, indistinguishable terms, and yet there is not in the books a
single case which has so far arisen on this clause or a clause virtually
indistinguishable from it. That seems to point very strongly to the fact that
it is not a matter of general public importance. Other people seem to have no
difficulty with the clauses at all.
He concluded
that it seemed to him quite clear that his original decision on this particular
point was perfectly right and he dismissed the motion.
In fact the state
of the authorities at that point can be seen from a decision of Warner J called
Datastream International Ltd v Oakeep Ltd, which is reported in a
note at [1986] 1 WLR 404*. Warner J delivered that judgment on November 5 1985,
which is of course just under a year after Walton J’s decision. But he reviewed
the earlier authorities and he identified in particular a decision of Goulding
J called Pugh v Smiths Industries Ltd (1982) 264 EG 823, [1982] 2
EGLR 120, which was a special case in that the exclusion of the provisions of
the rent review clause itself was so unambiguously worded as to make it
impossible to include a rent review clause in the hypothetical lease. So
Goulding J found, and Warner J said he did not see how he could have come to
any other conclusion.
*Editor’s
note: The case is reported at [1985] 1 EGLR 61.
On the other
hand, Warner J also identified a decision of Vinelott J, Pearl Assurance plc
v Shaw (1984) 274 EG 490. That was a case about a rent review clause,
but the problem in that case arose in relation to a user provision.
Nevertheless, the judgment of Vinelott J was significant in that it stated a
principle which was contrary to the approach that Walton J had adopted in his
decision. What Vinelott J said was this at p 491, near the top of the
right-hand column:
The purpose of
a rent-review clause in general is to enable a landlord to bring the rent
originally negotiated up to date and to substitute for it the rent that the
parties might have been expected to agree if the rent had been negotiated on
the same basis as before, but in the light of market conditions prevailing at
the time of the review and, of course, for the shorter term then unexpired.
Looked at in
that light I think the court should lean against a construction which requires
the rent fixed on revision to be ascertained without regard to the use which,
under the lease, the tenant is to be entitled to make of the demised premises,
unless, of course, that intention is spelled out in reasonably clear terms.
Otherwise, the effect of the review might be to impose on a tenant an
obligation to pay a rent appropriate to a very profitable use, but one very
obnoxious to the landlord, and one which he had been careful to forbid in the
strongest possible terms — the effect, that is, of making the tenant pay for
something which he not only has not got, but which he cannot require the
landlord to give him.
Plainly that
is not of direct relevance to the question with which Walton J was concerned,
whether one should read into the hypothetical lease a rent review provision.
But the philosophy behind the decision does seem to me to be significantly
different from the approach of Walton J in saying, as he did, that he thought
there was no presumption either way.
The Pearl
Assurance case, although it was in fact decided by Vinelott J one month
before Walton J’s decision, would appear not to have been cited to the learned
judge, no doubt because it was distinguishable very clearly on fact, being
concerned only with questions of user.
The tenants
appealed from Walton J’s refusal of a certificate and on June 13 1985 the Court
of Appeal held that it had no jurisdiction to entertain an appeal from a
refusal to grant a certificate† . Sir John Donaldson MR said in relation to The
Nema, to which I must come later:
It is not
apparent to what extent the matter was argued below; and, in any event, the
problem with which we are faced is different, because, as was pointed out by
Sir John Megaw in argument, in section 1(7) there is a direct and clear
antithesis between leave which can be granted alternatively by the High Court
and the Court of Appeal and the certificate which can only be granted by the
High Court. In the face of that antithesis and the decision of the House of
Lords in Gelberg v Miller [1961] 1 WLR 459 in the context of
similar provisions for criminal appeals, where Viscount Simonds said, at p 461,
that the whole purpose of section 1(2) of the Administration of Justice Act
1960 ‘is to ensure that leave to appeal shall not be granted unless it is
certified by the court below that a point of law of general public importance
is involved,’ I have no doubt at all that on the true construction of section
1(7) of the Act of 1979, this court has no jurisdiction to consider an appeal
from a refusal by a judge of the High Court to grant a certificate under the
Act.
† Editor’s
note: Also reported at [1986] 1 EGLR 98.
And it has not
been contended by either party before me that that is a decision which is
susceptible of any challenge at all.
It will be
noted that in that case, as in others, as will appear later, the close parallel
between the provisions of the Administration of Justice Act 1960 and the
Arbitration Act 1979 was noted.
So far as the
rent payable after the first review date in 1983 until the second review dated
was concerned, there was no further litigation until June 1987. But there was
correspondence in 1986 between the tenants and the landlords or their agents,
in which the tenants indicated that they were contemplating an action for
rectification. On January 6 1986, the landlords, through Mr Arnold, wrote to
the gentleman who had been acting as agent for the landlords and said, among
other things:
In the
circumstances, we have been looking for an alternative way of dealing with the
problem and, in particular, are contemplating an action for rectification. Our
review shows good evidence to support this and I anticipate that a Writ will be
issued during the course of January.
And he asks for
information from the gentleman to whom the letter was addressed.
On January 17
1986 Mr Arnold again wrote, this time to solicitors for the landlord, and
included in that letter is this:
I really
would emphasise that, because of the long term consequences to us, we do not
feel able to allow any stone to be left unturned in reversing the effect of
Walton’s J’s judgment. As previously indicated, a Writ of Rectification is our
most likely next course. However, you were kind enough to indicate that further
expensive litigation might not be necessary and that you would discuss the
matter further with your clients to see whether a sensible compromise might be
worked out.
He enquired
whether there was any possibility on that field.
That did not
bear much fruit and on March 10 1986 the same gentleman, Mr Arnold, sent a copy
of a decision which the Vice-Chancellor had given on February 6 1986 in a case
called British Gas Corporation v Universities Superannuation Schemes
Ltd [1986] 1 WLR 398*. In that case the Vice-Chancellor stated what he
regarded the correct approach was to questions of construction of rent review
clauses. At p 403 he said:
In these
circumstances, there are in my judgment conflicting decisions as to the correct
approach to the construction of these clauses. I am accordingly free to adopt
the approach I prefer. In my judgment the correct approach is as follows: (a)
words in a rent exclusion provision which require all provisions as to
rent to be disregarded produce a result so manifestly contrary to commercial
common sense that they cannot be given literal effect; (b) other clear words
which require the rent review provision (as opposed to all provisions as to
rent) to be disregarded (such as those in the Pugh case . . .)
*Editor’s
note: Also reported at [1986] 1 EGLR 120.
— that, I
interpose, is the decision of Goulding J that I mentioned earlier —
must be given
effect to, however wayward the result; (c) subject to (b), in the absence of
special circumstances it is proper to give effect to the underlying commercial
purpose of a rent review clause and to construe the words so as to give effect
to that purpose by requiring future rent reviews to be taken into account in
fixing the open market rental under the hypothetical letting.
I am
conscious that such an approach is perilously close to seeking to lay down
mechanistic rules of construction as opposed to principles of construction. But
there is an urgent need to produce certainty in this field . . .
And he
emphasised the practical considerations. There is a very large number of cases
that involve such a problem.
That decision
contained also a review of the two different lines of authority and the
different approaches adopted by different judges. It was because of that, no
doubt, that the copy of the decision was sent by Mr Arnold to the solicitor for
the landlords. In that letter he said:
You will note
that the Vice-Chancellor supports Lennie Hoffmann’s judgment and that the case
appears to be a mirror image of our own. You will see a reference to our case
on page 9 and the Judge’s non-comment is particularly interesting!
I am about to
press what may prove to be some very expensive buttons with the issuance of
fresh proceedings but before doing so would enquire whether your clients would
be willing to discuss matters . . .
The reference
to the judge’s non-comment is a reference to the fact that the Vice-Chancellor,
while explaining two decisions which supported the view that a rent review
provision should not be imported into the hypothetical lease, had not said
anything in favour of the decision that Walton J reached in this particular
case.
Almost a year
later, two things happened. The British Rail Pension Trustee Co Ltd on March 5
1987 contracted to buy out the half share in the reversion vested in the other
tenant in common. That contract contains a covenant which, it would appear,
would operate to put the burden of any refund that eventually was ordered in
respect of the rents paid after the first rent review, should Walton J’s
decision be upset, upon the purchaser, British Rail Pension Trustee Co Ltd by
way of indemnity to PosTel Properties Ltd. It is not absolutely clear that this
is so because it is done by reference to a deed which is not before the court,
but that would appear to be, prima facie, the effect of the contract.
At almost the
same time, the Court of Appeal approved what the Vice-Chancellor had said and
which I have quoted from the British Gas case, in a decision Equity
& Law Life Assurance Society plc v Bodfield Ltd [1987] 1 EGLR
124. Dillon LJ described them as rough guidelines but, subject to that
denomination, adopted them.
It was in that
state of the authorities that the writ in this matter in the second action
between these parties was issued. That action was called Arnold v National
Westminster Bank plc. Mr Arnold is in fact the same gentleman as I have
mentioned as the author of some letters. Two claims were made in that writ
which was issued on June 17 1987. One is rectification of the lease, and I need
not retail how that is put. It seeks to insert by way of rectification the
construction for which the tenants contend. And, second, in para 20 of the
statement of claim one finds this:
Further or in
the alternative to their claim for rectification, the Plaintiffs seek a
determination as to the basis on which those reviews are to be conducted and
contend that on the true construction of the definition of ‘the fair market
rent’ . . . the rent is to be reviewed on the basis of a letting for a term
equal to the residue of the term unexpired at the relevant review date with
provision for rent review on 24th June 1988, 1993, 1998 and 2004.
It was pleaded
specifically in the course of the rectification claim that Walton J had refused
to grant a certificate under section 1(7)(b) of the Arbitration Act
1979, ‘thereby precluding the plaintiffs from appealing against the said
order’. The defence, not surprisingly, admitted that allegation.
The next event
of significance is that the Court of Appeal in Basingstoke and Deane Borough
Council v Host Group Ltd [1988] 1 WLR 348*, on November 3 1987
reaffirmed the guidelines in the British Gas decision and that, in my
judgment, settles the question of principle whether there is a presumption in
favour of construing a rent review clause so as to require the tenant to pay
for that which he enjoys unless the context compels a different conclusion. It
is plainly arguable that that had happened in the Equity & Law Life
Assurance case in March of the same year.
*Editor’s
note: Also reported at [1987] 2 EGLR 147.
On October 1
1987 the landlords issued a summons to strike out para 20 of the writ in the
action brought by Mr Arnold and others, and that came before the
Vice-Chancellor for argument between April 27 and 29, and he gave his decision
on July 1. The point at issue was whether issue estoppel prevented the question
of construction being raised by the tenants, the point having of course been
decided by Walton J on the occasion of the first rent review. The
Vice-Chancellor concluded that, unlike cause for action estoppel, issue
estoppel did allow for special circumstances to take a case out of the general
rule that there is issue estoppel where the same point has been litigated
between the same parties. He decided that the issue estoppel did not prevent
the raising of the question of construction to be effected by the tenants on
the occasion of the second rent review. He listed the factors that were in his
judgment relevant as follows, at p 71 of the report which is at [1989] Ch 63† :
1 There is a continuing contractual
relationship of landlord and tenant under which, if there is an issue estoppel,
the decision of Walton J will regulate four further rent reviews and thereby
affect the rent payable until the end of the term.
2 Because of the peculiarities of the procedure
applicable to appeals from arbitrators, unlike the ordinary case of a prior
decision by a judge, the decision of Walton J was not subject to appeal.
Therefore a matter of very great financial importance involving millions of
pounds will, if an issue estoppel applies, be decided on a point of law which
the lessees have never had the opportunity to test in the higher courts.
3 The decision whether or not to permit an
appeal was the decision of Walton J himself and there was no right of appeal
against his refusal to certify the matter fit for appeal. The lessees took
every possible step to test the decision in the earlier case in the higher courts
but without success.
4 Subsequent decisions, in particular that of
the Court of Appeal in the Equity and Law Life case . . . make it, at
the lowest, strongly arguable that the decision of Walton J was wrong.
† Editor’s
note: Also reported at [1988] 2 EGLR 161.
And for those
reasons he held that issue estoppel did not apply and dismissed the application
to strike out para 20.
There was also
an attempt by the tenants to get the construction question tried as a
preliminary issue but that failed before Peter Gibson J on October 31 1988. The
only significance that I can detect in that particular episode was that the
tenants did, in my judgment, give the learned judge the impression that the
only way that they could recover the £1m odd that they claimed to be liable to
pay in excess of what should have been payable after the first rent review was
rectification. I find the following passage in Peter Gibson J’s judgment, p 7
at letter A:
The plaintiffs
accept that the rectification point will in any event have to be tried if they
are to recover the additional rent paid between 1983 and 1988. The total sum in
dispute in respect of that past rent is a little over £1 million, so that while
it is rightly said by Mr Gaunt that four-fifths of what is at stake in the
litigation (in the sense of four out of the five rent reviews) would be
conclusively determined if the plaintiffs won on both the issue estoppel point
and the construction point, on any footing there is a substantial amount
remaining in dispute.
In November
1989 the Court of Appeal dismissed an appeal from the Vice-Chancellor on the
issue estoppel question. That is reported at [1990] 2 WLR 304*. The three
learned judges, Dillon, Staughton and Mann LJJ, dealt with the question of
whether or not Walton J’s decision on the substantive point was wrong in
slightly different ways. Dillon LJ said at p 310 that the special circumstances
were basically that later decisions on rent review clauses indicated that
Walton J was wrong. He then quoted the guidelines in British Gas and
approved by Equity & Law Life and the Basingstoke decision,
and said of that, at the top of p 311:
It is plain
that the approach of Walton J, in the passage I have cited from his judgment,
is inconsistent with that guideline.
*Editor’s
note: Arnold v National Westminster Bank plc, also reported at
[1990] 1 EGLR 137.
He refers to a
more recent case of Amax International Ltd v Custodian Holdings Ltd
[1986] 2 EGLR 111, where it appears that Hoffmann J construed a rent review
clause similar to the present one in the opposite way so as to take account of
rent reviews.
He then dealt
with the question of issue estoppel, which I am not concerned with, and agreed
with the Vice-Chancellor’s view that special circumstances could operate to
prevent it being an absolute rule. He said this at p 318, letter H:
It is not
enough for a litigant who has argued a point of law and lost, to say, in order to
avoid issue estoppel, merely that it is arguable in the light of other
decisions at first instance that the previous decision at first instance might
have been wrong. He must go further. But the tenants here do go further.
He then quotes
the passage in the Vice-Chancellor’s judgment which I have read, saying that
there was a very substantial chance that on appeal the opposite result would be
achieved. Dillon LJ says of that, at p 319:
That seems to
be an understatement, but it is not necessary for us to reach a final
conclusion. I merely draw attention to three points. (1) It is admitted that
Walton J’s approach was not in accordance with the guidelines since laid down
and approved by this court. (2) There was nothing in this lease, properly
construed, to constrain him to the extreme (and to my mind ridiculous) position
that he seems to have taken of assuming a hypothetical lease with no covenant
for payment of rent and no power of re-entry for non-payment. (3) His decision
is contrary to commercial sense and the underlying commercial purpose of a rent
review clause in that he has saddled the tenants with the rent for a term they
do not have, that is to say a term at a fixed rent without reviews.
So although
the lord justice expressed himself in trenchant form, he did in terms say that
it was not necessary to reach a final conclusion on the point.
Staughton LJ,
at p 321, letter G said:
I have
difficulty in seeing why the plaintiffs would have failed if the original
decision had merely been plainly wrong (as I think it was), but should succeed
now that subsequent courts have shown that to be the case.
And that, he
said, might be a difficulty that would have to be resolved on another occasion.
Mann LJ
equally was categorical. He says at p 322, letter H:
It therefore
follows that nowadays ‘special circumstances’ or ‘exceptional circumstances’
can defeat an issue estoppel of whatever species. What is a special, or if one
wishes it, exceptional circumstance cannot, and in my judgment should not, be
defined. It is a matter for the judge in any case . . . I would not disagree
with the Vice-Chancellor’s finding of special circumstances in this case. I
regret to say that Walton J’s decision was in my view plainly wrong. If it were
arguably wrong, I might have taken a different view as to whether there was a
special circumstance.
I wish to add
only this. I was at one time during the course of argument troubled by In re
Waring (No 2) [1948] Ch 221. However, that case is distinguishable in my
view, because it was a decision of the court which it was sought to re-open.
Here there is no attempt to re-open the rent review for 1983 to 1988. The
present question is as to a totally independent rent review and the respondents
to this appeal have expressly disclaimed any intent to upset the previous
determination. Therefore In re Waring (No 2) no longer troubles me.
That was the
most categorical statement of the attitude of the tenants at that stage in
relation to the first rent review and its results.
was the tenants’ undoubted attitude at this stage, that the previous
determination stood and that there was no appeal from it.
In fact leave
to appeal has been given to the House of Lords and cases have been lodged by
either side. Leave was given on February 22 1990, but their lordships have not
yet heard the case and so the question of issue estoppel remains finally to be
decided by their lordships’ House.
That brings me
to this application. The notice of motion before me asks for an order that
notwithstanding the orders made by Walton J on November 26 and November 30
1984, the respondent be granted (a) a certificate pursuant to section 1(7)(b)
of the Arbitration Act 1979, that the questions of law to which the decisions
of Walton J relate are ones of general public importance or ones which for some
other special reason should be considered by the Court of Appeal; and (b) leave
to appeal to the Court of Appeal from the decisions of Walton J.
There are
three things that are needed by the tenant. One is a certificate which only I
can grant, although, if the tenants are right, an unsuccessful application
before me could perhaps be repeated before another judge. They need also leave
to appeal which both I and the Court of Appeal in the alternative could grant,
assuming that a certificate is granted. And they also need leave to appeal out
of time which, because of the wording of the relevant rule, it is common ground
between the parties, only the Court of Appeal can grant. The critical question
before me, of course, is whether I should grant a certificate.
The first
thing to consider is the Act itself. I do not propose to attempt any analysis
of section 1 because the House of Lords have pronounced on the scheme and
purpose of the Act in the particular context. The first of the two leading
cases in the House of Lords is The Nema [1982] AC 724. At p 740, Lord
Diplock turned to section 1(7), with which he was not directly concerned but he
was reviewing the whole of the legislation. With regard to that, he said this
at letter D:
Section 1 (7)
is another provision in favour of reaching finality as soon as possible; the
stringent conditions imposed upon a further appeal from the judge to the Court
of Appeal are clearly adapted from the provisions of the Criminal Appeal Act
1968 relating to appeals to the House of Lords in criminal matters — another
field of law in which speedy finality is much to be desired. The subsection
also draws a significant distinction between a question of law which arises in
connection with a ‘one-off’ case and a question of law of general importance to
a substantial section of the commercial community, such as may arise under
standard term contracts. I add parenthetically that it is one of the ironies of
the instant case that if the judge’s initial error in granting leave to appeal
to the High Court had not been compounded by his also giving a certificate and
leave to appeal to the Court of Appeal under this subsection (which a
fortiori in such a ‘one-off’ case he never should have done) the owners
would have been left with a decision against them which, although it is not one
of general public importance, both the Court of Appeal and this House have
unanimously held to be wrong.
The distinction
drawn between one-off contracts and standard terms was continued when Lord
Diplock stated the conclusion after his review of the legislation. At p 742
between letters G and H he dealt with one-off clauses saying:
Where, as in
the instant case, a question of law involved is the construction of a ‘one-off’
clause the application of which to the particular facts of the case is an issue
in the arbitration, leave should not normally be given unless it is apparent to
the judge upon a mere perusal of the reasoned award itself without the benefit
of adversarial argument, that the meaning ascribed to the clause by the
arbitrator is obviously wrong. But if on such perusal it appears to the judge
that it is possible that argument might persuade him, despite first impression
to the contrary, that the arbitrator might be right, he should not grant leave;
the parties should be left to accept, for better or for worse, the decision of
the tribunal that they had chosen to decide the matter in the first instance.
That was the
attitude in relation to one-off clauses. In relation to standard terms clauses,
at p 743 Lord Diplock said:
For reasons
already sufficiently discussed, rather less strict criteria are in my view
appropriate where questions of construction of contracts in standard terms are
concerned. That there should be as high a degree of legal certainty as it is
practicable to obtain as to how such terms apply upon the occurrence of events
of a kind that it is not unlikely may reproduce themselves in similar transactions
between other parties engaged in the same trade, is a public interest that is
recognised by the Act particularly in section 4. So, if the decision of the
question of construction in the circumstances of the particular case would add
significantly to the clarity and certainty of English commercial law it would
be proper to give leave in a case sufficiently substantial to escape the ban
imposed by the first part of section 1(4) bearing in mind always that a
superabundance of citable judicial decisions arising out of slightly different
facts is calculated to hinder rather than to promote clarity in settled
principles of commercial law. But leave should not be given even in such a
case, unless the judge considered that a strong prima facie case had
been made out that the arbitrator had been wrong in his construction; and when
the events to which the standard clause fell to be applied in the particular
arbitration were themselves ‘one-off’ events, stricter criteria should be
applied on the same lines as those that I have suggested as appropriate to
‘one-off’ clauses.
That attitude
was reaffirmed in the later case in the House of Lords, Antaios Compania
Naviera SA v Salen Rederierna AB [1985] AC 191. At p 203, letter G,
Lord Diplock said:
My Lords, I
think that your Lordships should take this opportunity of affirming that the
guideline given in The Nema . . . that even in a case that turns on the
construction of a standard term, ‘leave should not be given . . . unless the
judge considered that a strong prima facie case had been made out that
the arbitrator had been wrong in his construction’, applies even though there
may be dicta in other reported cases at first instance which suggest that upon
some question of the construction of that standard term there may among
commercial judges be two schools of thought. I am confining myself to
conflicting dicta not decisions. If there are conflicting decisions, the judge
should give leave to appeal to the High Court, and whatever judge hears the
appeal should in accordance with the decision that he favours give leave to
appeal from his decision to the Court of Appeal with the appropriate
certificate under section 1(7) as to the general public importance of the
question to which it relates; for only thus can be attained that desirable
degree of certainty in English commercial law which section 1(4) of the Act of
1979 was designed to preserve. Decisions are one thing; dicta are quite
another.
The function
of the court under section 1(7) is thus, as I see it: to grant a certificate
where it will be in the interests of the clarification of the law for the
benefit of the relevant part of the community at large. It is to be noted that
section 1(7) is phrased in the impersonal and passive mood. What is required is
no appeal unless it is certified by the High Court that the question of law is
of a particular character. And that was relied upon in argument on behalf of
the tenants in contradistinction to other legislation to which I must come
later, where there is a reference to an application which is obviously much
more susceptible of being regarded as meaning one and one application only.
But, in my
judgment, what one has to do is read the whole of the subsection together. And
if one does that, it seems to me evident that what is required is for both the
elements to be satisfied together: leave to appeal and a certificate, the
latter being a pre-condition of the former. Leave to appeal is governed by a
well-established timetable and rules regarding the possibility of extending time
and of applying for leave after time has expired. The Rules of the Supreme
Court provide rules, and authorities of the court provide principles, by which
the courts are regulated in granting leave to appeal out of time.
Conflicting
conclusions were drawn in argument before me on either side regarding the way
in which there is a total absence of any machinery with regard to the
certificate that section 1(7)(b) calls for, in contradistinction to the
abundance of rules and guidance in cases on the granting of leave to appeal.
For the landlords the submission was made that the fact that there was no
timetable provided and no provision for limiting time within which a
certificate was granted or any provision for extending it all pointed in the
direction of there being only one application envisaged and that that should be
within the time limited for appealing, because it is a condition precedent to
the right to appeal. For the tenant it was submitted that the fact that
Parliament had not in terms said whether one or more applications could be made
for a certificate was an indication that there was no intention to limit the
number of applications, because if it had intended to do so, it could perfectly
well have done it and indeed an example — and it may well be that there are
others — was pointed to in section 12(4) of the Administration of Justice Act
1969. This is the leapfrog appeal procedure from the High Court straight to the
House of Lords. Subsection (4) provides:
Any
application for a certificate under this section shall be made to the judge
immediately after he gives judgment in the proceedings: Provided that the judge
may in any particular case entertain any such application made at any later
time before the end of the period of fourteen days beginning with the date on
which that judgment is given or such other period as may be prescribed by rules
of court.
So if the
legislature is minded to impose restrictions, it can.
I prefer the
landlords’ arguments on this aspect of the case. It seems to me that the scheme
of the section does point strongly in favour of a once and for all process
whereby the double requirements of leave as between the parties and the
certificate in the interests of
certainty in the law are both intended to be met contemporaneously if not
simultaneously. That seems to me to be a strong pointer in favour of there
being only one process of obtaining a certificate under section 1(7)(b).
The next
consideration is this. The tenants contend that there is a power to grant a
certificate long after the decision at first instance was given and a
certificate is then refused. The type of case envisaged by that argument as
suitable for such a grant of a certificate on a later application is where
there has been a change in the law as generally understood, and that that
change has intervened between the original refusal and the subsequent
application for the grant of a certificate. In the present case it was
submitted that this in fact occurred when the Court of Appeal in Arnold
v National Westminster Bank plc stated that Walton J was plainly wrong,
or the equivalent in Dillon LJ’s judgment. A question of law to which a
decision relates may either gain or lose its status over the years as one of
general public importance and, if the tenants’ argument is correct, the proper
outcome of an application under section 1(7)(b), can, in my view, change
as the years go by.
Thus, in the
present case, if Walton J’s decision which contained the statement that there
was no presumption either way had been the first in the field on that score, it
could as well have been argued successfully that no question of law of general
public importance would at that stage have existed. But once decisions based on
a conflicting view were given and reported, as they were, if not when Vinelott
J gave his decision a month before Walton J, at least when the Vice-Chancellor
laid down the approach that he thought correct in the British Gas case
in February 1986, a question of law of general public importance, namely which
was the correct approach, did undoubtedly emerge.
Conversely,
once the Court of Appeal had settled the conflict between the two approaches,
as it is accepted by the tenants has now happened, if not in Arnold v Westminster
Bank, at the latest in Equity & Law Life and the Basingstoke
cases, then the question of general public importance is now settled and it disappears
as a question of general public importance. It seems to me improbable in the
extreme that Parliament should have contemplated that the provisions of section
1(7) could be activated by the emergence and brought to an end by the
disappearance of a question of law of general public importance. And that also
seems to me to be a pointer in favour of the conclusion that section 1(7) was
intended to operate once and once only.
I turn now to
the authorities which were cited to me as impinging on this question. There is
no authority on the point in relation to the Arbitration Act 1979. But there
are three cases that were cited to me in the field of criminal law in which the
possibility of more than one application for a certificate, not dissimilar to
the certificate in this case, was discussed.
The first
chronologically is Sweet v Parsley, which is reported in [1968] 2
QB 418 and also somewhat more fully in [1968] 2 All ER 337. The diligence of
counsel for the tenants has unearthed the case to the House of Lords in that
matter which did in fact proceed to the House of Lords eventually, and that has
been of some assistance in elucidating what happened in some detail in the
earlier stages.
The matter
starts with a decision of magistrates in Oxfordshire that there was an
infringement by the appellant of section 5(b) of the Dangerous Drugs Act
1965. The headnote reads as follows:
The appellant
was a tenant of a farmhouse in Oxfordshire. She herself let rooms in the
farmhouse at £5 to £6 a month, each so-called sub-tenant having the use of a
bedroom and a right in common with everyone else in the house to the use of the
kitchen. The appellant retained a bedroom in the farmhouse for her own use,
though when she was away she allowed others to use it. Early in 1967 she had to
move into Oxford, and thereafter only visited the farmhouse occasionally to
collect rent, etc. On June 16, 1967, the police searched the farmhouse and
garden and found small quantities of drugs. The appellant was charged with
being concerned in the management of premises which were used for the purpose
of smoking cannabis or cannabis resin contrary to s 5(b) of the
Dangerous Drugs Act 1965. It was not in dispute that the premises had been used
for the purpose of smoking cannabis resin and that the appellant herself had no
knowledge whatever that the house was being used for that purpose. On appeal
against conviction,
Held: though
the fact that the appellant was tenant of the farmhouse and thus responsible
for its rent and maintenance did not of itself establish that she was concerned
in the management of the premises, which was a question of fact depending on
the exact circumstances of the case, yet in the present case the justices were
fully entitled to hold that the appellant was concerned in the management of
the premises . . . Yeandel v Fisher . . . considered.
Appeal
dismissed.
That was on
March 22 1968. In the course of that decision, as the headnote indicates, the
earlier decision of Yeandel v Fisher was considered by the
Divisional Court which consisted of Lord Parker CJ, Ashworth J and Blain J. A
few days after the decision of the Divisional Court on March 22, that is to say
on April 4, an application was made for a certificate for an appeal to the
House of Lords under the Administration of Justice Act 1960, that a point of
law of general public importance was involved. The records contained in the
cases in the House of Lords contain a transcript of what was said on that
occasion. Counsel said that he had an application and when told by the Lord Chief
Justice that the court remembered the case well, he went on to say:
My
application is for leave to appeal to the House of Lords on the grounds that
points of law of general public importance are involved. In my submission there
are two such points. The first is whether section 5(b) creates an
absolute offence. On that there is a decision of this Court in Yeandel v
Fisher which was binding in respect of the appeal by Miss Sweet that an
absolute offence was committed. When that case was before your Lordships, your
Lordships refused leave to appeal but certified that there was a point of law
of general public importance. It would appear that the matter was not taken any
further after that so far as I know.
Then he went on
to make a submission about there being another point. The Lord Chief Justice
observed that this was decided purely on the special facts of this case. Their
lordships conferred and the Lord Chief Justice said: ‘We refuse you leave’, to
which counsel asked: ‘Would you certify that there is a point of law of general
public importance?’, and the Lord Chief Justice said: ‘We refuse to certify and
therefore leave does not arise.’
The order that
was made was naturally that a certificate was refused. But it appears from that
order that the matter occupied the time of the court from 2.00 pm to 2.10 pm.
On April 23
the application was renewed and at that stage it was adjourned. There is no
record before me of what happened on April 23.
On May 2 the
House of Lords gave its decision in the case of Warner v Metropolitan
Police Commissioner [1968] 2 All ER 356. In the course of that decision
there was comment on the case of Yeandel v Fisher. At p 365, for
example, Lord Reid said:
In Yeandel
v Fisher an innkeeper and his wife were charged that they were persons
concerned in the management of premises — the inn — used for the purposes of
smoking and dealing in cannabis. It was not proved that they knew that this was
being done on the premises but an appeal against their conviction was
dismissed. This case falls within the well established class of case where
persons who carry on some particular activity must do or refrain from doing a
particular thing at their peril, if, but only if, this is limited to persons
engaged in the day-to-day management; then it is reasonable to suppose that if
they were alert they would at least notice something suspicious. Lord Parker CJ
pointed out the difference between this provision and that which makes the
occupier liable if he ‘permits’ these things. He may well have no knowledge of
what is going on, but someone who is or ought to be there constantly ought to
be aware of it.
The only
thing that makes me hesitate about this case is the severity of the penalty and
the fact that this would be regarded as a truly criminal and disgraceful
offence, so that a stigma would attach to a person convicted of it.
Then later on
Lord Reid, in distinguishing Yeandel v Fisher, drew attention to
the very serious effect of an infringement of the Dangerous Drugs Act and
regulations made under it, saying at p 366:
If every
person who takes such a package into his custody must do so at his peril, then
this goes immensely further than any enactment imposing absolute liability has
yet been held to go, and I refuse to believe that Parliament can ever have
intended such an oppressive result.
That was a
case that was decided, and their lordships handed down their judgments, on May
2, but it had been argued on February 13, 14, 15, 19 and 20. The Divisional
Court in Sweet v Parsley, which had adjourned the application for
a certificate on April 23, reconsidered the question on May 13. The record of
what happened then in the All England Law Reports is as follows:
On renewal of
the application for leave to appeal, which had been refused on April 4, but had
been renewed on April 23 and then had been adjourned pending the decision of
the appeal in Warner v Metropolitan Police Comr (2), and now
again came before Lord Parker CJ, and Blain J:
Rose Heilbron
QC . . . referred to Warner’s case (2) and submitted that comparison of
the opinions of their lordships in the House of Lords in that case indicated
the need for further consideration of the section under which the present
applicant had been convicted.
The Lord Chief
Justice said:
We have been
in communication with Ashworth J, since the decision of the appeal in Warner’s
case (2), and we think that the applicant should have leave to appeal. We have
drafted certain points on which we are prepared to certify under s 1 of the
Administration of Justice Act 1960 that points of law of general public
importance are involved.
And then he
sets out what the points were, which it is not necessary to set out in this
judgment.
That was an
even briefer matter because the actual order that was drawn up with the
certificate with the three points of law in it records that the matter occupied
the time of the court from 10.46 am to 10.50 am.
In my
judgment, it is reasonably clear that what happened when the second application
was made first on April 23 was that their lordships in the Divisional Court
were then told that there had been heard argument in Warner by the House
of Lords and that Yeandel v Fisher had been the subject of
discussion. The Divisional Court decided that it would be right in the
circumstances to adjourn to see what the House of Lords was going to say, and
when that was known, without any argument and a fortiori without anybody
opposing the application, the Divisional Court decided that it would be right
to grant a certificate. That seems to me to be very largely conditioned by the
fact that when the matter was first before them for a certificate to be
granted, they were told that in Yeandel v Fisher, although there
had been a certificate granted, no further steps had been taken beyond that.
Now that was, as it seems to me, a perfectly accurate thing for counsel to say
because there is no record of that particular case having gone further. But,
nevertheless, it gave a slightly misleading impression because the impression
that it gave was that this was not a subject on which anything more had fallen
from superior courts whereas, as I have already indicated, the matter had been
already debated in the House of Lords and the cases had been discussed before
their lordships’ House and there was imminent a decision which indeed did cause
the Divisional Court to reach the conclusion that it did.
The case is
therefore, in my view, special in this sense; that there was a very particular
reason for treating the first hearing when the application was refused as not
entirely satisfactory. The other circumstance of course is that it all happened
within a very short time frame. The original decision in the Divisional Court
was on March 22 and the certificate was ultimately given less than two months
later on May 13. But, not unnaturally, the tenants rely on that decision as
indicating that there is jurisdiction to grant an application for a certificate
after an application has been made and rejected. And they point quite correctly
to the fact that there was argument on the first occasion before the court as
to why a certificate should be granted, and the court rejected those arguments
and, nevertheless, on subsequent application did grant it. Equally, it is
perfectly clear, and this was not contested by Mr Cullen, that the first order
was in fact drawn up because the actual order that was made when the
certificate was granted was prefaced with the words:
It is ordered
that notwithstanding the order of this honourable Court dated 4th April 1968
the appellant be given leave.
So it is
perfectly clear that the first order, unlike the first application before
Walton J for a certificate, did lead to an order being actually drawn up and
made.
Nevertheless,
I do not find in Sweet v Parsley a decision that there is a
general jurisdiction to review the desirability of granting a certificate under
section 1(7)(b). What that case is authority for, in my view, is that if
there is reason specifically for treating the first application as having been
made under a misapprehension, the matter may perhaps be reopened. It is not
necessary for me to embark on the question of how long a time-gap should elapse
before that state of affairs would cease to obtain.
The next
decision to which I was referred is R v Grantham [1969] 2 QB 574.
That was a decision under different legislation, the Courts-Martial (Appeals)
Act 1968 and there were different provisions in that Act. Section 8 of the Act
in subsection (1) says:
Subject to
the provisions of this Act, a person convicted by court-martial may, with the
leave of the Appeal Court, appeal to the court against his conviction.
Section 9(1)
reads:
Leave to
appeal to the Appeal Court shall [not] be given except on an application in
that behalf made by or on behalf of the appellant and lodged, within the
prescribed period, with the registrar.
I have
inserted a ‘not’ which the note of the subsection in the Law Reports omits.
Subsection (2) reads:
The
application must be in the prescribed form and specify the grounds on which
leave to appeal is sought and such other particulars, if any, as may be
prescribed.
Widgery LJ
there in giving the judgment of the court referred to Sweet v Parsley.
He said at p 579:
Reference was
also made to Sweet v Parsley . . . where the report speaks of an
application for leave to appeal to the House of Lords being renewed after a
prior refusal, but the facts of that case were very special. In the first place
the projected appeal was not from this court or the Court of Appeal (Criminal
Division) but from a Divisional Court. The decision of that court was based on Yeandel
v Fisher . . . which, unknown to the members of the court, had been the
subject of criticism in the House of Lords during argument in Reg v Warner.
The opinion of the House of Lords in Reg v Warner . . . was not
published until after the Divisional Court had refused Miss Sweet leave to
appeal but on receipt of that opinion the court was able to certify that a
point of law of general public importance arose in her appeal and to grant
leave accordingly. We do not think that these events cast light on the
jurisdiction of this court in the present application.
This court is
created by statute and has no jurisdiction beyond that which Parliament has
conferred upon it. By the combined effect of sections 8 and 9 of the
Courts-Martial (Appeals) Act 1968, a person convicted by court-martial has a
right to appeal but must, as a first step, obtain the leave of the court before
presenting his appeal. Parliament must be presumed to be mindful of the need to
make an end to proceedings and prima facie an appeal means one appeal
and ‘an application’ means one application.
There were in
fact other reasons for reaching the same conclusion but they are special to the
court-martial procedure.
The third and
last case is R v Ashdown [1974] 1 WLR 270. That was a case concerned
not with courts-martial but with ordinary criminal law and certificates for an
appeal to the House of Lords under section 33 of the Criminal Appeal Act 1968,
which is the model for the Arbitration Act 1979. In that case there had been an
application for a certificate and that had been refused. Edmund Davies LJ in
giving the judgment of the court at p 272 said as to how that occurred:
After the
judgment of the court was concluded, junior counsel then appearing for the
defendant asked us for leave to appeal to the House of Lords, whereupon I, as
the presiding judge, said to counsel, ‘On what point?’ The reply was ‘On the issue as to whether a
life sentence is appropriate in these circumstances.’ The members of the court then conferred and
the application was refused.
He then deals
with the arguments that were advanced on this second application by Mr
Blom-Cooper [counsel for the defendant], dealing first with the question of
jurisdiction. He expressed the views of the court at p 273:
We are of the
view that we have not.
— that is to
say jurisdiction to entertain the application —
What happened
when the court adjudicated is, of course, to be interpreted only upon one
basis; counsel was asked upon what point of law he sought leave to appeal and
he addressed himself to that question in the manner already indicated. This
court conferred about the matter and came to the conclusion that that did not
raise a point of law and so refused the application. Mr Blom-Cooper has told us
that counsel was confused because he thought he was asking simply for leave to
appeal to the House of Lords and did not think that he was then being asked to
formulate the point of law. We hope that we have not been too long in the law
to have lost all recollection of our early days in practice, and we have to say
that the application made by young counsel, who had been vigilant and had
demonstrated ability throughout the presentation of the appeal, was made when
he could not fail to have appreciated that a point of law had first to be
formulated so that the court could consider whether or not it was, in the words
of section 33(2), of ‘general public importance’ before we could go on to
consider whether it was such as appeared to be one which ought to be considered
by the House of Lords. So we have to approach this case, our duty obliges us to
say, on the basis that an application properly founded was made to this court,
considered by it and rejected. The question then arises whether in those
circumstances we have power to consider a fresh application today.
Then he deals
with R v Grantham and points out that it was a court-martial
case. But he says of it:
Widgery LJ,
surveying the whole law and not of course confining himself to courts-martial
affairs, made reference to Sweet v Parsley . . . There, as Mr
Blom-Cooper has rightly observed, the court had originally on March 22 1968, as
appears from that report at p 426, refused an application for leave to appeal
to the House of Lords. On April 23 counsel applied to renew the application for
a certificate that a point of law of general public importance was involved in
the decision and for leave to appeal and then, that application being
adjourned, on the adjourned hearing the court gave leave to appeal, granted a
certificate and proceeded to state certain points of law. Mr Blom-Cooper
accordingly invoked Sweet v Parsley as indicating that this court
can indeed entertain repeated applications for leave to appeal to the House of
Lords.
He then quotes
Widgery LJ in R v Grantham, and I need not read that again.
Edmund Davies LJ finally says:
We
respectfully agree with that view and we accordingly think that the answer to
the first question is that in the circumstances which occurred in this court in
this case, we have no jurisdiction to entertain the renewed application for
leave to appeal to the House of Lords.
On those
authorities I have reached a similar conclusion, namely that I do not in the
circumstances of this case have jurisdiction under section 1(7)(b) to
grant the certificate that is asked. That makes it unnecessary for me to deal
with the other two points that were in fact fully argued before me: one,
whether by their prosecution of the proceedings in the action Arnold v National
Westminster Bank and the manner in which they resisted the landlord’s
application to strike out, the tenants had adopted an attitude which precluded
them from making this present application. And the other, whether in the
circumstances of this case, assuming, contrary to the way in which I have
decided the case, there was jurisdiction, it should be exercised in this case.
It would be a work of supererogation, and I hope I shall not be regarded as
disrespectful to the careful arguments of counsel, for me to travel over that
ground. I find that in the circumstances I have no jurisdiction and in those
circumstances I cannot do anything other than dismiss the application.
The
application was dismissed with costs.
