Analysis
W and M were married in 1969 and divorced in 1974. During their marriage, they bought a leasehold property with the proceeds of their former matrimonial home and a mortgage loan for the balance. The benefit of the long lease of the property was conveyed to them as joint tenants. M moved out of the property in 1973 and began divorce proceedings. No steps were taken in the divorce to deal with the ownership of the house, which remained vested in them as joint tenants. After M left the property, W had treated it as his own, insuring, maintaining and improving it and, soon after the divorce, letting it. In 1978, W purchased the freehold of the property and in 1990 he redeemed the mortgage. On 21 March 2015, W died intestate.
W’s personal representative brought an action against M, claiming that an informal settlement had been reached between W and M at the time of the divorce, including a sale by M to W of her share of the property. At first instance it was held that there had been no sale of M’s share but that, by reason of the mutual dealings between the parties, the beneficial joint tenancy was severed by the end of 1975. Accordingly, M did not take the property by survivorship and each party was entitled to 50% of the property. The lower court judge decided that M was the successful party and ordered W’s personal representative to pay 80% of M’s costs.
W’s personal representative appealed, seeking a variation of the judge’s order, so that W’s estate would have 86% of the beneficial interest in the property and M 14%. He also appealed the costs order, claiming that he, and not M, had been the successful party.
Held
On the appeal, the appeal judge conducted a review of the decision below, not a rehearing: CPR 52.21(1); Audergon v La Baguette Ltd [2002] EWCA Civ 10; [2002] C.P. Rep. 27. He set out the following guidance:
- 1)In CPR 52.21(3), which provides that the appeal court will allow the appeal where the decision was (a) wrong, or (b) unjust, because of serious procedural or other irregularity in the proceedings below, ‘wrong’ meant wrong in law, wrong in fact, or wrong in the exercise of discretion.
- 2)As to the appeal against the costs order, the appeal judge could interfere only if the judge below erred in principle, wrongly included or left out of account some feature to be considered (or not) or went wholly wrong because he did not balance the various factors in the scale (Islam v Ali [2003] EWCA Civ 612 followed).
- 3)If the appeal concerned the exercise of a discretion, the appeal judge could interfere only where it ‘exceeded that generous ambit within which reasonable disagreement is possible’ (Tanfern Ltd v Cameron-McDonald [2000] 1 WLR 1311 applied).
The substantive appeal
W’s personal representative had argued in the lower court that, by the conduct of W and M after they had divorced, they had evinced an intention to sever the joint tenancy and to vary the beneficial interests in the house from 50% each. The lower court judge decided that there had been a severance but rejected the argument that there had been an intention to vary the beneficial interests. He found, on the basis of the evidence, that he could not infer an agreement to vary. The appeal judge decided that, as there had been no challenge on the appeal to any of the findings of fact by the lower court judge, there was no basis for intervention. In any event, the appeal judge was satisfied that the lower court judge had taken into account all of the relevant circumstances in reaching his decision.
Costs appeal The lower court judge held that, as W’s personal representative had failed to establish that the estate had more than 50% interest in the property, M was the successful party and awarded costs accordingly. The appeal against this decision was allowed because the lower court judge misunderstood who was the successful party and the appeal judge was therefore entitled to intervene and make the costs decision afresh: if W’s personal representative had not succeeded in establishing that there had been a severance, M would have become entitled to the whole of the property by survivorship and, even if only to the extent of a 50% interest in the property, W’s personal representative succeeded (Day v Day [2006] EWCA Civ 415 followed). The lower court judge’s order was varied by an order for M to pay 60% of the costs of W’s personal representative for the lower court hearing.
JUDGMENT HHJ PAUL MATTHEWS: Introduction [1] This is my judgment on an appeal brought by Mr Alan Wall, in his capacity of personal representative of the estate of Bryan Wall deceased, against the order of Mr Recorder Norman dated 30 June 2017 (but sealed on 23 August 2017). The order was made in a claim …Continue reading "Wall v Munday [2018] WTLR 337"