Kevythalli Design Ltd v Ice Associates Ltd

A stay of execution suspends enforcement. It does not discharge, set aside or otherwise nullify orders lawfully made before the stay. Nor does it, without more, mean that the underlying judgment debt ceases to be presently due and payable.

An application to transfer proceedings from the County Court under CPR Part 30 should be assessed by reference to the prescribed matters, including value, convenience, fairness, judicial expertise and public importance. A transfer is not justified merely because an interim enforcement order has delayed access to money, particularly where the claimed prejudice is unsupported by adequate evidence and the issue will soon be overtaken by an appeal.

The claimant, an architecture practice, obtained judgment in the Central London County Court for unpaid fees after the defendant served an amended defence and counterclaim late. The defendant’s application to set aside the judgment was dismissed. A renewed application for permission to appeal was pending, and a stay of execution had been granted pending an oral hearing.

After the claimant obtained an interim third-party debt order in respect of money payable to the defendant under an adjudication award, the defendant applied to transfer the proceedings to the High Court and sought relief concerning the order. The central issues were the effect of the stay on the existing enforcement order and whether transfer was appropriate under CPR 30.3.

1. The application to transfer was dismissed. The existing County Court judgment remained in force unless and until altered by the Court of Appeal. The claimant was entitled to take steps to enforce it while permission to appeal was being considered.
2. A stay of execution imposed pending an appeal operates prospectively on enforcement. It prevents execution or enforcement for the time being, but does not require the discharge or setting aside of orders validly made before the stay. The interim third-party debt order therefore remained in existence, although it could not be enforced during the stay.
3. The defendant’s submission that the stay meant that the judgment debt was no longer presently due and payable was rejected. Berliner Industriebank Aktiengesellschaft v Jost [1971] 2 All ER 1513, at p 1518, was not directly on point. The dicta relied upon did not establish that a general stay of execution removes the character of the judgment debt. The position depended ultimately on the outcome of the appeal: if the appeal succeeded, the judgment would be set aside; if it failed, the judgment debt would remain confirmed.
4. The application to transfer did not satisfy the criteria in CPR 30.3(2). The financial value of the claim was just over £100,000; the County Court had suitable TCC expertise; no material convenience or fairness advantage was shown; and the practical question would in any event await the Court of Appeal’s decision.
5. The alleged prejudice from withholding the adjudication monies was not established by sufficient financial evidence. The defendant had provided no balance sheet or comparable evidence of serious financial difficulty, and there was evidence of continuing activity connected with the Cardiff premises. The interim order was therefore not discharged. The defendant was ordered to pay £3,000 costs within 14 days.

The judgment records that the defendant’s County Court judgment in favour of the claimant, given by His Honour Judge Brian Knight QC, was followed by dismissal of an application to set it aside. An application for permission to appeal was dismissed by Eady J. Aikens LJ later granted a stay of execution pending an oral hearing concerning permission to appeal. This judgment determined the transfer application and related enforcement issues; it did not determine the pending appeal.