Atherton v Ogunlende & Anor

On a second appeal, permission requires an important point of principle or practice, or another compelling reason. Fresh evidence will generally be refused where it was available for use below, particularly where the evidence is sparse and its likely effect uncertain. A cross-claim raised unsuccessfully when a statutory demand is challenged cannot ordinarily be reopened at the bankruptcy petition stage where no appeal was brought against that earlier decision. A bankruptcy court may decline to defer to related ancillary relief proceedings where those proceedings have been dormant and the cross-claim lacks real substance. A notice of assignment given with the statutory demand does not, without more, justify setting aside a bankruptcy order.

The applicant sought permission for a second appeal from Neuberger J’s dismissal of his appeal against the dismissal by Mr Registrar Baister of applications to stay or annul a bankruptcy order. The order was founded on a debt owed to the applicant’s former wife, which she had assigned to the first respondent. The applicant relied on a possible cross-claim arising from ancillary relief proceedings, disputed child-maintenance arrears, the timing of notice of assignment, and article 6 of the European Convention on Human Rights. He also sought to adduce substantial new evidence. The central questions were whether the proposed appeal satisfied the second-appeal threshold and whether the cross-claim or other grounds justified reopening the bankruptcy proceedings.

Application for permission refused. The extension of time was granted, but the applications to file fresh evidence and for permission to appeal were refused.

1. Under Civil Procedure Rules 1998, CPR 52.13, a second appeal requires an important point of principle and practice or some other compelling reason. The proposed grounds did not satisfy that threshold.
2. The fresh evidence concerning ancillary relief, alleged arrears and jointly owned assets was available before the appeal to Neuberger J. It was also materially incomplete and open to dispute. There was no real prospect that permission would be granted to introduce it at that stage.
3. The cross-claim had already been raised in the application to set aside the statutory demand. That application had been dismissed and there had been no appeal. Applying Turner v Royal Bank of Scotland [2001] 1 BPIR 688, the issue could not be reargued at the bankruptcy petition stage, save in exceptional circumstances.
4. Winstanley v Winstanley [2001] BPIR 720 was materially different. There, the cross-claim had been actively pursued contemporaneously with the bankruptcy proceedings and the claimant’s entitlement to damages had already crystallised in a court order. Here, the ancillary relief proceedings had been dormant for a substantial period and there was no real prospect of showing that the judge was wrong to find no real substance in the cross-claim.
5. The assignment point could not succeed because notice had been given when the statutory demand was served. Article 6 added nothing: the applicant had access to the court and had been represented by counsel before Neuberger J.

Detailed assessment of the applicant’s community legal funding was ordered.

1. High Court of Justice, Chancery Division: Neuberger J dismissed the applicant’s appeal on 4 April 2001 from the registrar’s decision.
2. Mr Registrar Baister: dismissed the applications to stay or annul the bankruptcy order on 5 December 2000. The bankruptcy order had been made on 1 June 2000.
3. Court of Appeal (Civil Division): granted an extension of time but refused permission for a second appeal and refused the application to file fresh evidence.