Paulin v Paulin

Permission to appeal should be granted where refined grounds are arguable. That may include a challenge to the lower court’s jurisdiction to reverse a judgment after delivery, particularly where the later decision represents a substantial and central volte-face. The Court of Appeal may consider such a jurisdictional issue of its own motion. An apparent tension between the lower judge’s earlier and later reasoning may itself provide an arguable ground. The grant of permission determines only arguability; it does not decide the merits.

The husband sought permission to appeal against an ancillary relief order made by Mr Richard Anelay QC, sitting as a deputy High Court judge in the Family Division. The order followed an unusual sequence of judgments concerning the annulment of the husband’s bankruptcy under Insolvency Act 1986, section 282(1)(a), and the availability of funds connected with a company alleged to be his alter ego.

The judge first dismissed the wife’s application to annul the bankruptcy, then reconsidered the matter after further argument and issued an Amended Judgment annulling it and ordering payment of substantially all funds held by the wife’s solicitors. The husband challenged the findings on his ability to pay debts and the exercise of discretion, and raised an arguable issue as to the judge’s jurisdiction to reverse the earlier decision. The central question was whether permission to appeal should be granted on those grounds.

1. Application granted. Permission to appeal was granted on the refined grounds in the husband’s skeleton argument and on any additional ground concerning the judge’s jurisdiction to reconsider the matter on 11 April 2008.
2. The proposed grounds were arguable despite the husband’s lack of merit in the proceedings. The issue whether the husband could pay his debts as they fell due, and the related exercise of discretion to annul the bankruptcy, required consideration on appeal.
3. The judge had relied on Re T (Contact: Alienation: Permission to Appeal) [2003] 1 FLR 531 in concluding that he could reverse his earlier judgment. It was arguable that, after delivering the judgment on 18 March 2008, he had erred in making a volte-face of such breadth and centrality in the Amended Judgment. The present court did not determine that jurisdictional issue at the permission stage.
4. The Court of Appeal could consider the jurisdiction point of its own motion, since it went to the judge’s power to act in April 2008. The inconsistency between the judge’s earlier reasoning and his later reasoning also supplied an arguable basis for appeal.
5. The underlying findings that the debt from Cativo Ltd to Dramaflight Ltd was bogus, that the county court judgment should be set aside, and that Cativo was the husband’s alter ego were no longer challenged.

• Court of Appeal (Civil Division): Permission to appeal granted on the refined grounds and any added jurisdictional ground.
• High Court of Justice, Family Division: Mr Richard Anelay QC, sitting as a deputy High Court judge, made the ancillary relief order on 23 May 2008 after reversing his earlier decision concerning annulment of the bankruptcy order. No citation for the lower court decision is stated in the judgment.