Zazulak (t/a Stefco Precision & General Engineers) v Dickenson & Anor (t/a Asset & Finance Leasing) & Anor

Permission to appeal requires a real prospect of success or another compelling reason. An appellate court will not grant permission merely to reargue credibility, suspicious circumstances or factual inferences where the trial judge heard the evidence and gave full and clear reasons. Where a pleaded issue was omitted from the judgment and it is genuinely uncertain whether it was conceded, the court may obtain clarification from the parties and trial counsel before deciding whether permission should be granted. The application may therefore be adjourned on unresolved issues while permission is refused on grounds that disclose no real prospect of success or compelling reason.

The applicant appealed, out of time, from a decision of His Honour Judge Barry in the Halifax County Court dated 4 February 2000. The county court had rejected most of the applicant’s claim concerning machinery removed during repossession, allowed the value of a Churchill CNC lathe and other recovered items as credits against the respondents’ counterclaim, and entered judgment for the balance of £1,641.65.

Before the Court of Appeal, the applicant challenged the assumed default justifying termination and repossession, alleged that the leased assets had been sold below proper value, and disputed the trial judge’s findings about further missing machinery, alleged deception, witness credibility and the destruction of a video recording. The central procedural question was whether the two issues omitted from the county court judgment required further clarification before permission to appeal could be determined.

1. Disposition. The application was adjourned for further enquiries on two issues and dismissed on all other grounds. The court was prepared to grant any necessary extension of time if permission were otherwise justified.
2. Permission threshold. Permission required a real prospect of success or another compelling reason. The applicant’s challenges to the factual findings concerning machinery allegedly removed and later lost did not meet that threshold. The trial judge had heard the evidence, assessed the witnesses, considered the overall probabilities and gave full and clear reasons. Sympathy for the applicant, criticism of one respondent’s credibility, or suspicion about events did not justify reopening those findings.
3. Unresolved pleaded issue. The county court judgment did not address whether the applicant had defaulted under the leasing agreement so as to justify termination and repossession. It was uncertain whether that issue had been conceded at trial. The Court of Appeal directed that comments be obtained from the respondents and from the applicant’s trial counsel. If the issue had been conceded, the omission was explained; if not, there was at least a proper point requiring consideration on appeal.
4. Alleged failure to mitigate. The judgment also did not address the pleaded allegation that the leased machinery had been sold below its proper value. The valuation evidence referred to an open-market value of £6,400, an estimated restricted realisation price of £3,150 and a net realisable value of about £4,750 plus VAT, whereas the respondents had realised only £2,350 inclusive of VAT. Clarification was therefore required on this issue also.
5. The remaining complaints, including alleged deception in obtaining entry, the wiping of a video and reliance on documents and accounts, disclosed no real prospect of success or other compelling reason for permission.

• Court of Appeal (Civil Division): On 27 April 2001, the application for permission to appeal was adjourned for further enquiries concerning the alleged concession of default and the alleged failure to realise proper value. Permission was refused on all other grounds: [2001] EWCA Civ 630.
• Halifax County Court: His Honour Judge Barry decided the claim and counterclaim on 4 February 2000. The applicant’s claim was largely rejected, and judgment was entered for the respondents on the counterclaim after credits for the lathe and other recovered items.