Ocean Healthcare Ltd v Sigma Pharmaceuticals Plc

An appeal against findings of fact and witness credibility will not succeed merely by re-arguing the evidence where the trial judge had documentary and oral material capable of supporting the conclusions reached. The legal burden of proving delivery remains on the claimant, but a defendant alleging that invoices and delivery records are forged bears an evidential burden of producing supporting evidence. Witness statements from persons unavailable for cross-examination may receive reduced weight but may still be accepted where supported by other evidence. Fresh evidence on appeal must satisfy the principles in Ladd v Marshall; evidence obtainable with reasonable diligence for trial, or incapable of materially influencing the result, will not be admitted.

Sigma Pharmaceuticals plc claimed payment for pharmaceutical goods invoiced and allegedly delivered to Ocean Healthcare Ltd. Following summary judgment proceedings, the County Court trial concerned disputed invoices and whether the goods had been ordered and delivered. His Honour Judge Birtles rejected Ocean’s evidence that the delivery records were forgeries and entered judgment for Sigma for £25,997.49 inclusive of interest on 23 October 2013.

Ocean appealed, challenging the judge’s findings, the treatment of witness statements and an alleged lack of fair opportunity to address evidence identifying staff signatures. It also sought to adduce fresh handwriting evidence. The central issues were whether the judge had determined the material issues and whether the factual findings or fresh evidence application disclosed any basis for appellate intervention.

Lady Justice Gloster gave the leading judgment, with Lord Justice Kitchin and Lady Justice Arden agreeing. The appeal was dismissed.

1. The case had become a straightforward factual dispute. The trial judge had substantial documentary evidence and evidence from delivery drivers. He was entitled to prefer the claimant’s witnesses, reject the allegation that the delivery notes were forgeries and find that the goods had been ordered and delivered. The appeal was therefore no more than an attempt to re-litigate findings of fact and credibility.

2. The legal burden of proving delivery remained on Sigma. However, Ocean bore the evidential burden of producing evidence for its allegation that the invoices and delivery notes were forgeries. Ocean had the relevant delivery notes for months before trial and could have called other staff or obtained handwriting evidence earlier. The judge was entitled to rely on positive identification of Mr Haider and his brother at trial, subject to his assessment of reliability and fairness.

3. The judge’s description of the issue as whether the goods were delivered did not show that he had failed to determine whether they had been ordered. His reasoning and findings, including his reliance on the invoices and the delivery procedure, implicitly rejected that contention. The absence of electronic ordering records was not significant because the relevant information appeared on the hard-copy invoices.

4. Statements from witnesses unavailable for cross-examination could properly be given limited weight without being disregarded altogether. The judge was entitled to accept them as part of the totality of the evidence, particularly where they were consistent with the documents and with evidence given by witnesses who were cross-examined.

5. The application to adduce handwriting evidence failed the first two tests in Ladd v Marshall [1954] EWCA Civ 1, [1954] 1 WLR 1489. The evidence could have been obtained with reasonable diligence for trial and would not have had an important influence on the result. There was no separate overriding-objective or interests-of-justice reason to admit it or remit the case for retrial.

• Court of Appeal (Civil Division): dismissed Ocean Healthcare Ltd’s appeal.
• Mayor’s and City of London County Court: His Honour Judge Birtles entered judgment for Sigma Pharmaceuticals plc for £25,997.49 inclusive of interest on 23 October 2013.