Arora & Anor v Stevenson

On a second appeal, permission should be refused where the proposed grounds disclose neither an important point of principle or practice nor another compelling reason for appellate intervention. An application that is bound to fail may be struck out as an abuse of the process, particularly where its continuation delays realisation of a bankrupt’s asset for creditors. The court may give the applicant a short opportunity to show cause before striking out the application. The statutory test concerns the proposed appeal, not a collateral challenge to the making of the bankruptcy order.

The trustee in bankruptcy of Mr Krishnan Kumara Arora sought an order for sale of a property registered in his name. The Registrar declared that the whole beneficial interest had vested in the trustee and ordered sale and vacant possession. Neuberger J dismissed Mr and Mrs Arora’s appeal and extended the possession date. Mr Arora’s proposed second appeal required leave under section 42 of the Supreme Court Act 1981, which had not been obtained. Mrs Arora applied for permission to appeal. The central issue was whether her grounds satisfied the second-appeal threshold under section 55(1) of the Access to Justice Act 1999.

1. Permission and adjournment. The Court proceeded with Mrs Arora’s application in her absence. The material supplied did not establish that she was unable to attend, and the request for an adjournment was refused.
2. Second appeal threshold. The application was for permission to bring a second appeal from the High Court’s appellate order. Under section 55(1) of the Access to Justice Act 1999, the Court of Appeal could entertain the appeal only if it raised an important point of principle or practice, or there was another compelling reason for hearing it. The grounds disclosed neither.
3. Scope of the proposed challenge. The lower courts had found no material supporting Mrs Arora’s claimed beneficial interest. The Registrar had ordered sale under section 335A of the Insolvency Act 1986 and declared that the entire beneficial interest had vested in the trustee under section 306. Neuberger J had found no basis to interfere. The proposed argument that the bankruptcy order should not have been made was not properly raised on the trustee’s sale application.
4. Abuse of process and order. An application bound to fail should not remain on the court file longer than necessary, particularly where it delays realisation of a bankrupt’s asset for creditors. Mrs Arora’s application was therefore ordered to be struck out as an abuse of process unless, within 14 days, she applied to show cause. Any such application was to be listed before a Court of Appeal judge within seven days.

• Court of Appeal (Civil Division): Mrs Arora’s application for permission to bring a second appeal was ordered to be struck out as an abuse of process unless she applied within 14 days to show cause.
• Chancery Division in Bankruptcy: Neuberger J dismissed the appeal from the Registrar’s order and extended the date for vacant possession by one month.
• Registrar in Bankruptcy: Mr Registrar James declared that the whole beneficial interest in the property had vested in the trustee in bankruptcy, ordered its sale and directed vacant possession.