Promontoria (Oak) Ltd v Emanuel & Anor

A judgment alleged to have been obtained by fraud cannot ordinarily be challenged within an appeal from that judgment. The allegation involves factual issues and matters that were not before the first-instance judge, so it must be pursued by a fresh action, or as a discrete issue dealt with in substance as a fresh action.

Fresh evidence will be admitted on appeal only where it satisfies the established requirements, including that it would have had an important influence on the result, although it need not have been decisive. Evidence which does not affect the issues determined below is irrelevant to the appeal and should not be admitted.

Promontoria (Oak) Ltd succeeded before Mr Recorder Willetts in a claim to recover debts assigned by Clydesdale Bank. The Recorder relied partly on a substantially redacted assignment deed and secondary evidence of title.

The defendants appealed on grounds concerning the admissibility and sufficiency of the assignment evidence. They also sought to adduce further evidence and amend their appeal to allege that the judgment had been procured by non-disclosure, fraud, abuse of process or potential perjury.

The court determined whether the fraud-related ground could be pursued on appeal and whether the proposed new evidence could be admitted in support of the existing grounds.

1. Ground 7 refused. The proposed fraud-related ground was not permitted to be introduced. An allegation that a judgment was obtained by fraud challenges matters beyond the first-instance judge’s reasoning, fact-finding or discretion. It ordinarily raises significant factual issues and concerns matters which were not before that judge. It must therefore be pursued by a fresh action, or otherwise dealt with as a discrete issue in proceedings which are in substance a fresh action: Owens v Noble [2010] EWCA Civ 224 at [27] and [29]; Salekipour v Parmar [2017] EWCA Civ 2141 at [69] ff.
2. The court declined to express a view on the merits of the fraud allegation. The proposed pleading would in any event require substantial expansion and particularisation. The defendants could pursue the allegation separately if so advised.
3. New evidence refused. The proposed evidence consisted of a deed from another transaction and Promontoria Oak’s 2017 financial accounts. Even assuming that it was new, it could not have had an important influence on the issues determined by the Recorder. Counsel accepted that, on the material before the Recorder together with the proposed new evidence, the Recorder’s conclusion that Promontoria Oak had title to recover the debts could not be shown to be wrong or arguably wrong.
4. The relevant test for fresh evidence remains that stated in Ladd v Marshall [1954] 1 WLR 1489, including the requirement that the evidence would have had an important influence on the result, though it need not have been decisive. The court considered the principles in Sharab v Al Saud [2009] EWCA Civ 353 at [52] and Consolidated Developments Ltd v Cooper [2018] EWHC 1727 (Ch) at [33].
5. The existing appeal grounds could still raise arguments that documents relating to chain of title should have been produced, or that the redactions were impermissible. They could not be used to allege that the defendants and the court had been culpably misled into proceeding on the basis that the redactions were proper. That contention would reintroduce the substance of the excluded fraud ground.

The applications to admit new evidence and to introduce Ground 7 were dismissed.

• High Court (Chancery Division): Mr Recorder Willetts’ decision of 16 July 2018 allowed Promontoria (Oak) Ltd’s claim. Permission to appeal was granted only on Grounds 1 to 3; permission on Grounds 4 to 6 was refused.
• High Court (Chancery Division): The applications to adduce new evidence and to introduce Ground 7 were dismissed. The substantive appeal on Grounds 1 to 3 was to be heard subsequently.