One Picture Ltd v Craig

Where a trial judge decides an amended pleading by reference to an earlier version and thereby fails to determine a material claim, the appellate court may remit that issue for determination. The remission should be confined to the omitted issue and may require further evidence or argument. A claim should not be remitted where the underlying issue has already been resolved, or where it falls outside the permission to appeal. Interest on sums awarded on a counterclaim may run from the date of the counterclaim, even without an earlier demand, if receipt of the pleading made the claim for repayment sufficiently clear. A successful litigant in person may recover the costs of the appeal.

One Picture Ltd brought proceedings concerning intellectual property rights in software and related branding. Timothy Craig counterclaimed against the company and its director, asserting partnership-related and monetary claims. The High Court, Chancery Division, rejected his partnership and intellectual-property claims but awarded him sums for loans and certain expenses.

Permission to appeal was limited to issues arising from the counterclaim. The trial judge had considered the wrong version of the counterclaim and had not expressly determined the amended claim for expenditure incurred on business activities. The appeal concerned whether that issue should be remitted, whether a separate copyright-related claim should also be remitted, the starting date for interest, and the costs of the appeal.

Lord Justice Mummery delivered the judgment, with Lord Justice Chadwick and Lord Justice Longmore agreeing. The appeal was allowed to the limited extent set out below.

1. The trial judge had based his decision on the unamended counterclaim. As a result, he had failed expressly to determine the claim in paragraph 16(c) of the amended counterclaim for recovery of expenditure incurred on business activities. That issue was remitted to him.
2. The remission was confined to paragraph 16(c). Some expenditure had already been dealt with, including the loans totalling £33,500 and the £2,400 paid to solicitors. The remaining items could be resolved by further evidence and argument if necessary. The parties were encouraged to agree which items had actually been incurred and focus on whether they were spent for Mr Craig’s independent business or for the benefit of One Picture Ltd and Dr Smith.
3. The copyright-related claim in paragraph 17 was not remitted. The trial judge had already resolved the copyright dispute by declaring One Picture Ltd to be the owner, and the claim was outside the limited permission to appeal.
4. Interest was payable, at a rate fixed by the trial judge, on the sums recovered under the counterclaim from 14 October 2002, the date of the original counterclaim. Although there had been no earlier demand, the counterclaim made clear that repayment of the loans and expenses was sought.
5. As the successful appellant, Mr Craig was awarded the costs of the appeal as a litigant in person.

The operative order was remission of paragraph 16(c), but not paragraph 17, interest from 14 October 2002, and costs in favour of Mr Craig.

1. Court of Appeal (Civil Division): The appeal was allowed to the limited extent of remitting paragraph 16(c) of the counterclaim, awarding interest from 14 October 2002, and awarding the appellant his appeal costs: [2004] EWCA Civ 743.
2. High Court, Chancery Division, Bristol District Registry: His Honour Judge Weeks QC rejected the partnership and intellectual-property claims, awarded Mr Craig £33,500 against Dr Smith and £5,440 against One Picture Ltd, and did not expressly determine paragraph 16(c) of the amended counterclaim. Limited permission to appeal was granted in relation to the counterclaim.