Russell & Anor v Sheen

On a second appeal, permission is available only where the proposed appeal raises an important point of principle or practice, or there is another compelling reason for the Court of Appeal to entertain it.

A challenge to factual findings, the assessment of unchallenged evidence, or case-specific calculations does not satisfy that threshold merely by being characterised as irrational or disproportionate.

Where interlocutory steps are required because material facts were not disclosed and another party’s interests were left unprotected, the resulting costs may properly be attributed to the party whose conduct caused the need for those steps.

Alan and Pamela Russell sought the sale of a jointly owned property and declarations concerning the division of the equity and rental income between themselves and Wyndham Sheen. The Clerkenwell County Court ordered a 50/50 division of the equity, awarded the Russells half of the net rent, and made costs orders against them.

Jacob J dismissed their appeal on the substantive issues but varied the costs order. The Russells renewed their application for permission to bring a second appeal. The central question was whether the proposed grounds met the statutory and procedural threshold for a second appeal.

The Court of Appeal, consisting of Waller and Chadwick LJJ, unanimously refused permission to appeal.

1. Second appeal threshold. Under section 55(1) of the Access to Justice Act 1999 and CPR 52.13, permission required an important point of principle or practice, or some other compelling reason for the Court of Appeal to entertain the matter. The court held that none of the proposed grounds met that threshold.
2. Interlocutory costs. The costs issue arose because Commercial Law Direct had not disclosed that it was not a licensed conveyancer and proposed to charge a fee, while no adequate security had been arranged for the sale proceeds in which Mr Sheen claimed a beneficial interest. The court considered that the position had to be remedied. The use of a telephone call by Mr Sheen’s representatives was not the material issue; the District Judge had made the subsequent decisions. The costs of the remedial steps were properly attributed to the conduct of Commercial Law Direct and the Russells. Jacob J could not be said to have been wrong.
3. Substantive issues. The challenge to the 50/50 division depended on findings of fact supported by Mr Sheen’s unchallenged evidence. The complaint about double counting in the rental calculation was also factual. Neither raised an important point of principle or practice.

The application was refused with costs. The Russells were ordered to pay £7,500 on account within 28 days.

• Court of Appeal (Civil Division): The renewed application for permission to bring a second appeal was refused with costs: [2002] EWCA Civ 818.
• High Court: Jacob J dismissed the Russells’ appeal from the county court’s substantive findings, but varied the costs order on 16 July 2001.
• Clerkenwell County Court: His Honour Judge Reynolds ordered a 50/50 division of the equity, awarded the Russells half of the net rental income, and made costs orders against them. Earlier orders concerned the conduct and protection of the sale proceeds.