Kuppusamy v Mathankanna & Anor

An appellate court should not reverse a factual decision based substantially on witness credibility unless satisfied that the primary decision-maker was obviously wrong. This restraint applies with particular force where the decision followed a multi-day hearing and involved allegations of fraud. Documentary inconsistencies or an incomplete explanation of reasons do not necessarily justify intervention if the court is satisfied that the relevant matters were considered and the conclusion remains available on the evidence. An appellate court may intervene where the primary decision-maker failed altogether to consider a material issue, but an omission in expressing reasons may be insufficient if the surrounding record shows that the issue was in fact taken into account.

The appeal arose from a decision of the Deputy Adjudicator to HM Land Registry dated 11 November 2011. The Deputy Adjudicator had found that Mr Mathankanna’s signature on a transfer of a petrol-station property into Mr Kuppusamy’s sole name was forged, and directed that Mr Mathankanna be restored to the register.

Mr Kuppusamy challenged the decision on grounds concerning witness credibility, payments allegedly made to a third party, a letter said to negate secrecy, attestation, handwriting evidence, the exclusion of a witness, and the adequacy of the Deputy Adjudicator’s reasoning. The central issue was whether the appellate court was entitled to interfere with findings of fact and credibility.

Appeal dismissed. The Deputy Adjudicator’s conclusion that Mr Mathankanna had not executed the transfer was not shown to be obviously wrong.

1. An appellate court must exercise caution before reversing findings of fact. Where there has been no misdirection, it should not substitute its own conclusion unless convinced that the advantage enjoyed by the primary decision-maker in seeing and hearing the witnesses could not explain or justify the decision. This principle was stated in Thomas v Thomas [1947] AC 484, Smith New Court Securities Ltd v Scrimgeour Vickers (Asset Management) Ltd [1997] AC 254, Benmax v Austin Motor Co Ltd [1955] AC 370 and Biogen Inc v Medeva plc [1997] RPC 1.
2. The restraint was especially important here. The Deputy Adjudicator had heard three days of evidence, observed the witnesses under cross-examination, and resolved the central issue by assessing credibility. The appellate court was therefore required to defer to her conclusion unless it was unequivocally satisfied that she was wrong.
3. The Deputy Adjudicator’s reasoning concerning the alleged £43,000 loan and subsequent payments to Mr Pancious was sparse, and the treatment of the intended transmission of the December letter could have been expressed more fully. Nevertheless, the appellate court concluded that these matters had been considered and that the findings remained available on the evidence. The absence of Mr Pancious and the lack of direct evidence left a substantial evidential gap.
4. The Deputy Adjudicator was entitled to attach some weight to the handwriting evidence and to exclude Vijay while disputed evidence was being given. Neither decision involved a material procedural irregularity or unfairness.

The court dismissed the appeal. The preliminary view was that costs should follow the event, with Mr Kuppusamy paying Mr Mathankanna’s appeal costs, subject to detailed assessment if not agreed. Barclays was to be sent a copy of the judgment and could apply if it had incurred costs.

• High Court (Chancery Division): The appeal from the Deputy Adjudicator to HM Land Registry was dismissed. The court upheld the factual conclusion that the transfer had not been executed by Mr Mathankanna.
• Deputy Adjudicator to HM Land Registry: On 11 November 2011, the Deputy Adjudicator found that the signature was forged and directed restoration of Mr Mathankanna to the register. Permission to appeal was refused on 11 January 2012, but permission was subsequently granted by the High Court on 21 November 2012.