John Airey v Computer Services

In a small-claims arbitration, a dispute appearing factual may still raise arguable questions of law concerning contractual remedies and ancillary charges. Leave to appeal may be appropriate where a lower court has failed to investigate those issues. The small-claims objective of finality, economy and speed does not justify an unexplained award. An arbitrator should record the evidence and give sufficient reasons to identify what was decided and why, particularly where the absence of reasons prevents effective appellate review. The Court of Appeal may grant leave partly to enable guidance on appropriate reasoning in small-claims cases.

Mr Airey claimed the return of his laptop computer and damages after a computer business retained it following a disputed hard-disk replacement and demand for an additional charge. A district judge, acting as arbitrator under Order 19, dismissed the claim without recorded reasons. The circuit judge dismissed the appeal, treating the dispute as factual and finding no misconduct or error of law. On an application for leave, the Court of Appeal considered whether arguable legal questions arose concerning repudiation, return of the computer on payment, and storage charges, and whether the inadequate record justified appellate consideration.

Lord Justice Waite gave the judgment, with Lord Justice Potter agreeing. The court allowed the application for leave to appeal. It did not determine the merits of the underlying dispute.

1. Arguable questions of law. The circuit judge had treated the matter as a simple conflict of fact. The Court of Appeal considered that arguable legal issues arose. They included whether Mr Airey could repudiate the agreement and recover the computer without a hard disk and obtain a refund; whether he had a lesser right to recover the computer on payment of £25 plus VAT; and whether storage charges could be imposed.
2. Inadequate record and reasons. Order 19 rule 7(8) required the arbitrator to notify the parties of the award and give reasons. The district judge’s order merely dismissed the claim. There was no surviving note of the evidence or reasons. This left it unclear whether the whole transaction, only the primary remedy, or also the claim for return on payment had been dismissed.
3. Small-claims guidance. The purpose of the small-claims jurisdiction was finality with minimum expense and delay. That objective did not remove the value of recording the evidence heard and the reasons influencing the decision. The court considered the case a suitable opportunity for the full court to give district judges guidance on the appropriate level of explanation in small-claims awards.
4. Order. Application allowed. The appeal was to be set down within seven days.

• Court of Appeal (Civil Division): On 18 April 1997, granted leave to appeal and directed that the appeal be set down within seven days: [1997] EWCA Civ 1450.
• Court of Appeal (Civil Division): On 28 February 1997, adjourned the leave application to allow an opportunity for the computer to be returned or the conditions for its return to be clarified.
• Brighton County Court: On 8 March 1996, dismissed Mr Airey’s appeal from the district judge’s award, treating the matter as factual and finding no misconduct or error of law.
• District judge acting as arbitrator: On 12 January 1996, dismissed the claim under the small-claims arbitration procedure without recorded reasons.