Haydock Finance Ltd v Louis Transport Equipment Consultants Ltd & Ors

Under CPR Part 52.7, the normal rule is that an appeal does not stay execution. An appellant seeking a stay must establish proper grounds. Where the appellant can pay the judgment debt and there is no real risk that repayment will be impossible if the appeal succeeds, overwhelming reasons are required before a stay should be granted. The expected hearing of the appeal within a short period is not, by itself, such a reason. A stay application lacking any properly arguable ground may justify indemnity costs.

Haydock Finance Ltd obtained judgment against the six defendants in Birmingham County Court. The county court judge refused leave to appeal. The Court of Appeal later granted permission on paper, and the appeal was listed for hearing approximately two months later.

The defendants applied for a stay of execution. They did not allege inability to pay or identify a risk that repayment would be impossible if the appeal succeeded. The issues were whether execution should be stayed, how the costs of the oral hearing should be dealt with, and whether indemnity costs were appropriate.

1. Stay refused. The application was dismissed. CPR Part 52.7 requires an appellant seeking a stay to make a proper case. The normal rule is that execution is not stayed pending appeal, as stated in Leicester Circuits Ltd v Coates Brothers Plc and reflected in the principles identified in Hammond Suddards Solicitors v Agrichem International Holding Ltd [2002] EWCA Civ 2065.
2. The defendants did not suggest that they were unable to pay. Nor was there any real risk that the judgment sum could not be repaid if the appeal succeeded. In those circumstances, overwhelming reasons would have been required for a stay.
3. The fact that the appeal was due to be heard in about two months did not justify delaying payment. A successful claimant is entitled to receive the judgment sum immediately if the appeal fails.
4. The hearing should have been dealt with as a paper application. The costs of the oral hearing were therefore to lie where they fell. The claimant’s reasonable costs of preparing written submissions could be included, but travelling costs to London were not recoverable. No costs of the oral hearing were awarded to the appellants because their solicitors had served submissions late.
5. The application had no prospect of success and disclosed none of the proper grounds contemplated by Part 52.7. The costs judge was directed to assess the relevant costs on the indemnity basis.
6. The claimant’s solicitors were entitled to instruct the sheriff to levy execution. The defendants had neither sought a stay when applying for permission to appeal nor offered adequate security for the judgment sum.

• Court of Appeal (Civil Division): Permission to appeal from the Birmingham County Court decision was granted on paper on 17 January 2005. On 4 March 2005 the application for a stay of execution was dismissed, with consequential costs directions.
• Birmingham County Court: His Honour Judge McKenna gave judgment after a hearing on 20 September and refused leave to appeal.