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The Court of Appeal upheld trial judge’s decision to order an account in millions

Court of Appeal - Gangat v Jassat,

The Court of Appeal upheld trial judge’s decision to order an account in millions

The Court of Appeal (Lord Justice Nugee, Lord Justice Stuart Smith, and Lord Justice Warnby) upheld the decision of Mr Eason Rajah QC ordering an account in millions against the Defendant for breach of fiduciary duties.

The Court of Appeal held that the judge referred to the facts with commendable clarity (§3). Disclosures to the South African Revenue Service revealed that approximately £40 or £65 million, comprising profits in a off book cash business, were secretly taken out of South Africa by the South African businessmen in breach of Exchange Control regulations and placed in Swiss accounts. This included the Claimants’ share of monies. Thereafter funds were distributed in agreed proportions. The Defendant used the Claimants’ share of the monies to purchase various properties in the UK.

The Court of Appeal held the overall issue was whether the Defendant was accountable to the Claimants (§45). That ultimately depended on the question whether the Defendant had control of property belonging to the Claimants. The Court of Appeal held that the judge succinctly identified this question in his judgment which depended upon whether, viewed objectively, the Claimants were entitled to expect him to administer that property for their benefit (§45). There was no requirement to establish a breach of fiduciary duty in order to establish a duty to account.

There can be no hard and fast rules regarding the impact of document suppression, which depended upon the evidence and issues (§44). If the Court can make secure findings of fact on the basis of other evidence, even after making due allowances for what might have been deliberately withheld, then it is entirely appropriate for it to do so. (§44). The Court of Appeal held that, even considering the fact of deliberate document suppression, the judge had benefit of seeing extensive cross examination of the Defendant on the documentary evidence and other matters, such that, even discounting the Claimants’ evidence, the judge had enough material emanating from the Defendant to reach the conclusion he did (§ 46-47).

The Court of Appeal held that it should be very wary of being too prescriptive as to how judge’s write their judgments (§42). This is particularly when it comes to a trial judge’s analysis of the evidence. The Court would be doing no-one favours if it started laying down rules requiring judges to spell out in detail why they have or have not accepted particular pieces of evidence, let alone what the significance might be of evidence that, for whatever reason, was not before the Court (§ 42). It is to be assumed that a judge knew how to perform judicial functions, and had taken the whole of the evidence into consideration, unless the contrary is established (§43).

The Claimants’ Amended Particulars of Claim was not, on a fair reading of the pleading, limited to two specific sums namely $4 million and $12 million, but included an allegation that, whatever else the position was, the Defendant was accountable to them among other things for the portfolio listed in the Richmond Lodge Document which he admitted holding for them, and there was undoubtedly evidence to support that case (§55-57). That was sufficient to entitle the judge to find that the Richmond Lodge Document was intended to be an account of what the Defendant was holding for the Claimants in 2009, and to conclude that he was accountable at least for what he there admitted holding. It was not necessary for the Judge to delve into the detail of precisely how the assets there listed had come to be acquired (§56). Nor was it necessary to show what transfer of monies funded the portfolio (§55). The judge had rejected other answers to the claim and the defence of illegality did not feature in the appeal (§52).

The circumstances in which the Richmond Lodge Document came to be produced embraced the question whether it was produced by the Defendant and intended to be an acknowledgment of what he was then holding; or whether it had been altered for personal use (§62). The Judge had to resolve that question and did so with considerable care (§ 62 & 17). The effect of the judge’s decision, that the Richmond Lodge document was an agreed statement of account, had the effect of rejecting the Claimants’ case that it was a partial account, and was not something which the Defendant could object to on appeal (§64).

The Court of Appeal dismissed the appeal with costs.

Arfan Khan acted for the successful Respondents on appeal and Claimants at trial.

The judgment can be access here:

https://www.bailii.org/ew/cases/EWCA/Civ/2022/604.html

ARFAN KHAN SUCCESSFUL IN ESTABLISHING THE CORRECT TEST IN INDEFINITE LEAVE APPEAL

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Leave to remain: R (Akinola) v Upper Tribunal (Secretary of State for the Home Department interested party) [2021] EWCA Civ 1308 (Court of Appeal: Lord Justice Philips, Lord Justice Stuart Smith and Sir Stephen Richards)

The Court of Appeal has delivered a guidance decision in three cases on the interpretation and effect of s.3C of the Immigration Act 1971 in indefinite leave to remain cases.

The requirement that an applicant satisfy the 10 years lawful residence before applying for indefinite leave to remain is contained in Rule 276B of the Immigration Rules.

The purpose of s.3C leave is to protect the immigration status of those with existing leave pending the determination of a variation application or appeal in respect of that decision. It is framed to prevent an abuse of the system by permitting one application for variation. It provides that leave is extended during any period where:

“(a) the application for variation is neither decided nor withdrawn,

(b) an appeal under section 82(1) of the Nationality, Asylum and Immigration Act 2002 could be brought, while the appellant is in the United Kingdom against the decision on the application for variation (ignoring any possibility of an appeal out of time with permission), or

(c) an appeal under that section against that decision, brought while the appellant is in the United Kingdom, is pending (within the meaning of section 104 of that Act)” (emphasis added in italics).

The appeals concerned the effect of section 3C on (i) an appeal out of time for which an extension of time is granted, and (ii) a withdrawal and/or reconsideration of a refusal decision.

The principal question in dispute was whether leave revived with future effect or retroactively, so as to run continuously from the time when it otherwise expired at the end of the period in section 3C(2)(b) (§ 48).

On appeal to the Court of Appeal, the SSHD introduced a new policy based on the reasoning of the Upper Tribunal in R (Ramshini) v Secretary of State for the Home Department dated 31 July 2019 (JR/2156/2019). In Ramshini, relying upon the Court of Appeal decision in R (Erdogan) v Secretary of State for the Home Department [2004] EWCA Civ 1087, the Upper Tribunal held that an appeal is instituted under s.104 of the Nationality Immigration and Asylum Act 2002 when permission to appeal is granted out of time. As a result, in so far as material, the new policy of the SSHD (v.10) provided that s.3C leave revived prospectively from the date permission to appeal was granted, as opposed to retrospectively.

The Court of Appeal held that it was common ground that an out of time appeal for which an extension of time is granted engages section 3C (2) (c) as a pending appeal and results in a revival of s.3C leave (§ 48). It held that the linguistic considerations pre Ramshini, which sought to avoid the retroactive application of s.3C to out of time appeals, were not sufficient to cause it to challenge the common ground that section 3C (2) (c) can apply to an out of time appeal for which an extension of time is granted.

On Akinola’s challenge to the analysis of the Upper Tribunal’s decision in Ramshini, the Court of Appeal held that section 3C had retroactive effect from the date the Appellant’s notice is filed under rule 19 and 20 of the 2014 Rules, and not from the date that the Court extends time for appeal, as held in Ramshini (and adopted in the new policy of the SSHD). The Court of Appeal held that Ramshini was wrongly decided in so far as it relied on the decision in Erdagon: 

“[47]. The Secretary of State now accepts the approach in Ramshini and has changed her section 3C guidance to reflect it in the current version 10.0. Accordingly Ms Giovanetti QC, on behalf of the Secretary of State, accepted before us that an appeal out of time for which an extension of time is granted does cause leave to revive by virtue of section 3C(2)(c) but submitted that it does so only with future effect from the date when the extension of time is granted. On the other hand Mr Khan and Mr Hawkin, for Ms Akinola and Mr Alam respectively, took the approach in Ramshini one step further, submitting that when section 3C(2)(c) is engaged by an appeal out of time for which an extension of time is granted, it extends the section 3C leave with retroactive effect so as to make that leave continuous from the end of the period in section 3C(2)(b) when it otherwise expired. As a subsidiary challenge to the analysis in Ramshini, Mr Khan argued further that where an extension is granted for an appeal out of time, the appeal is instituted when the notice of appeal is filed, not when the extension of time is granted, and that it is therefore pending for the purposes of section 3C(2)(c) from the time when the notice of appeal is filed.

[48]. It is therefore common ground that an out-of-time appeal for which an extension of time is granted engages section 3C(2)(c) as a pending appeal and results in a revival of the section 3C leave. The principal question in dispute is whether that leave revives only with future effect or does so with retroactive effect so as to run continuously from the time when it otherwise expired at the end of the period in section 3C(2)(b).  I have found that a difficult question. There are substantial pointers in each of the two directions canvassed in argument before us, but also in the direction of the position as widely understood prior to Ramshini…

[59]. The UT in Ramshini, citing R (Erdogan) v Secretary of State for the Home Department [2004] EWCA Civ 1087, held that an appeal is instituted at the point when the FTT grants permission to appeal out of time, i.e. when the FTT decides to extend time for appealing. The Secretary of State has again accepted that position. Mr Khan submitted, however, that the decision in Erdogan is distinguishable and that on proper analysis an out-of-time appeal is instituted when the notice of appeal is filed, even though the existence of a valid appeal from that date will depend on the later grant of an extension of time.

[63]. Given the different wording of the primary legislation and the rules in force at the time, and the extent to which Newman J’s reasoning was based on such wording, the judgment in Erdogan case appears to me to be distinguishable and to provide no real assistance in determining when an appeal out of time is instituted in accordance with the legislative regime that governs the present cases. In distinguishing Erdogan on a different issue in R (Secretary of State for the Home Department) v Immigration Appeal Tribunal [2004] EWHC 3161 (Admin), Collins J noted at [44] that “the Rules did not at that stage provide for an appeal to exist in circumstances where there was an application to the Tribunal out of time”. 

[64]. Accordingly, the UT in Ramshini was in my judgment wrong to rely on Erdogan on this issue and wrong to reach the conclusion it did on the issue.  In my judgment, for the reasons given above, where an extension of time is granted for an appeal out of time, the date when the appeal is instituted and becomes a pending appeal within section 3C(2)(c) is the date when the notice of appeal was filed, not the date when the extension of time was granted. That involves the acceptance of an element of retroactivity, in that where the grant of an extension of time post-dates the filing of the notice of appeal it causes leave to revive from the earlier date when the notice of appeal was filed.  In this case, however, it seems to me to be the clear result of the relevant legislative provisions”.

Whilst the Court refused permission to appeal in Akinola, and dismissed the other two appeals, the Court of Appeal certified Akinola as a case which can be cited in other cases under Practice Direction para 6.1.

ARFAN KHAN appeared for Akinola instructed by DCK Solicitors.

The judgment can viewed here:

https://www.bailii.org/ew/cases/EWCA/Civ/2021/1308.html

 

 

 

 

 

ARFAN KHAN and KATHERINE ARCHER succeed in establishing the correct test to be applied to sexual misconduct appeals under s.40 of the Medical Act 1983

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ARFAN KHAN and KATHERINE ARCHER succeed in establishing the correct test to be applied to sexual misconduct appeals under s.40 of the Medical Act 1983

On 30 April 2021, in Okpara & Anor v General Medical Council [2021] EWCA Civ 623, the Court of Appeal (Macur, Davies and Lewis LJJ) ruled on the correct test to be applied by the High Court in appeals brought by doctors pursuant to s.40 of the Medical Act 1983, particularly in sexual misconduct appeals. The Court held that the High Court (Administrative Division) had applied the wrong test.

Following a two-day appeal, and a reserved judgment, the Court of Appeal held (Nicola Davies LJ giving the judgment of the court), that there was a line of authority, reflected in Jagjivan which indicates that cases of sexual misconduct fall within a category where an appeal court can more readily assess whether a particular sanction is appropriate and thus give less weight to the expertise of the Tribunal. The Court endorsed that line of authority and held that the High Court had erred in following Bawa-Garba v General Medical Council [2019] 1 WLR 1929 in this sexual misconduct case:

[91] Counsel on behalf of Dr Okpara identifies a tension between the sexual misconduct cases referred to in Jagjivan, which permit the appellate court to decide issues of weight for itself without deferring to the expertise of the Tribunal, and the approach in Bawa-Garba, where the court defers to the expertise of the Tribunal by adopting a restrictive error of principle approach on appeal, akin to a review rather than a rehearing. It is this tension which Leggatt LJ was referring to when granting permission to appeal. 

[113] …We conclude that the judge, in following Bawa-Garba in this case, did fail to have regard to the line of authority reflected in Jagjivan …We agree that in matters such as dishonesty or sexual misconduct, the court is well placed to assess what is needed to protect the public or maintain the reputation of the profession and is less dependent upon the expertise of the Tribunal.  It follows that we find that the approach of the judge to the sanction imposed upon Dr Okpara was wrong in that he did not assess whether the sanction was necessary or appropriate in the public interest or was excessive or disproportionate. 

Applying Ghosh v General Medical Council [2001] 1 WLR 1915 and Khan v General Pharmaceutical Council [2017] 1 WLR 169, the Court of Appeal held that the test on s.40 appeals was whether the sanction imposed by the Medical Practitioners Tribunal was “wrong” and that the approach at the hearing, which was appellate and not supervisory, was whether the sanction imposed was appropriate and necessary in the public interest or was excessive and disproportionate. The appeals under s.40 are by way of a rehearing, rather than review, and it is not sufficient for intervention to turn on the more confined grounds of public law review such as irrationality.

The Court proceeded to consider the sanction afresh. It upheld the High Court on the sanction of erasure.

The full Judgment is available here.

ARFAN KHAN and KATHERINE ARCHER, instructed by DCK Solicitors, acted for the second appellant Dr Okpara, who succeeded in establishing the correct test to be applied by the High Court in a sexual misconduct appeal pursuant to s.40 of the Medical Act 1983.

 

Court of Appeal grants permission to appeal

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The Court of Appeal (Civil Division) has granted permission to appeal on the papers in a second appeal in Okpara v General Medical Council [2019] EWHC 2624 (Admin). The appeal raises an important point of principle regarding whether sexual misconduct appeals fall within a category where an appeal court can more readily assess whether a particular sanction is appropriate and thus attach less weight to the expertise of a tribunal.

Arfan Khan acted for the successful Appellant.

 

 

Court of Appeal grants permission in important trust appeal

Appeal, Chancery Division, Court of Appeal, Privy Council appeals, Trust and Property appeal,

Court of Appeal (CHD) grants permission to appeal in important trust appeal

The Appellant, a former solicitor, claimed he held a beneficial interest in property by way of constructive or resulting trust. The property was purchased as an investment. It was registered in the sole name of the Appellant’s wife. A joint charge was placed over the property by the Legal Services Commission. This was done in order to secure the joint indebtedness of the Appellant and his wife arising out of their legal practice as solicitors.

The Court at first instance held that the Appellant was not entitled to a beneficial interest in the property by way of constructive or resulting trust, and that the property vested in the wife’s joint trustees in bankruptcy.

The Appellant appealed. Permission to appeal was refused on the papers by the Honourable Mr Justice Snowden. The Appellant renewed permission to appeal on the issue of whether he had a beneficial interest in the property. Following an oral hearing in the Business & Property Courts of England & Wales (Chancery Appeals), the Honourable Mr Justice Snowden was ‘persuaded’ to grant permission to appeal limited to that issue without expressing a concluded view on the merits of the appeal.

The appeal raises evidential issues concerning the correctness of the first instance judge’s findings of fact on the Appellant’s beneficial interest in investment property in light of the LSC charge, and all the relevant circumstances.

The appeal also seeks to establish a novel point of law in sole ownership cases involving the determination of beneficial interest in property. Namely where property is purchased as an investment, in the absence of an express direction by the Privy Council that its decision in Marr v Collie [2018] AC 631 represents the law of England and Wales, the Courts at first instance are bound to follow the Court of Appeal decision of Lord Neuberger to the contrary in Laskar v Laskar [2018] 1 WLR 2695.

This is consistent with higher authority, including the reasoning of the Supreme Court in Willers v Joyce [2018] AC 851 concerning the procedure in the Privy Council for holding that a Court of Appeal decision is wrong. This involves expressly making a decision that the Court of Appeal is wrong, and directing that the domestic courts should treat the Privy Council decision as representing the law of England and Wales. Marr does not expressly appear to overrule Laskar. Nor does it appear to contain the direction in question.

Arfan Khan represented the Appellant and did not appear below.

 

Court of Appeal grants permission to appeal in default judgment case

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Default judgment –  Practice and Procedure

The Court of Appeal grants permission to appeal in a case of general public importance involving the practice and procedure surrounding default judgments.

The Claimant issued a claim against the Defendant for unpaid monies following the completion of construction works. The Defendant filed an Amended Defence and Counterclaim alleging that the works were defective and counterclaimed for damages. The Claimant served witness statement evidence denying the damages claimed, but not a formally pleaded defence to the counterclaim.

At trial in the Central London County Court, where the Appellant was represented by alternative Counsel, the Defendant contended that the Claimant had not filed a defence, and that the Defendant was entitled to default judgment. The Circuit Judge proceeded to grant default judgment on the basis that the Claimant had failed to file a formally pleaded defence.

The Appellant appealed to the Court of Appeal. The Appellant argued that there was a point of general public importance arising on the appeal, namely whether, in the absence of a formally pleaded defence, a witness statement denying damages claimed in the counterclaim constitutes “a defence” for the purposes of default judgment under CPR r 12. 3 2 (b). This was argued in conjunction with para 1.1 of Practice Direction 12 which states that a defence includes “any document purporting to be a defence”.

Lord Justice Christopher Clarke was persuaded to grant permission to appeal on the basis that the point was of general public importance, raising a point of practice or procedure, in respect to which the Appellant had real prospects of success. His Lordship allowed the appeal to proceed on the condition that the Appellant pay the outstanding interim costs order which the Appellant agreed to do.

Arfan Khan was instructed as lead Counsel on appeal and did not appear in the proceedings below.

The transcript of judgment will be available soon.