Nicola McKenzie v Creation Consumer Finance Limited

On an appeal by way of review, the appellate court asks whether the decision was wrong or unjust because of serious procedural or other irregularity. It does not rehear the evidence or substitute its own assessment of fact.

Where a claimant proves contractual liability but must establish loss, a benefit reflected in an increased sale price must be brought into account. If the increase cannot be measured precisely, the trial judge must assess it as best as possible on the available evidence. A calculation devised for a different factual situation may be used as a rough proxy, but it is not a generally appropriate valuation method. The court upheld the dismissal of the claim because the benefits exceeded the transaction’s costs.

The claimant purchased solar panels from My Planet Ltd following false representations made by its agent. The purchase price was funded by a regulated consumer credit agreement with Creation Consumer Finance Limited. The claimant later sold the property with the panels in situ and redeemed the finance agreement.

The County Court at Cardiff found that Creation was liable for the false representations under section 56 of the Consumer Credit Act 1974, but dismissed the claim because the claimant had suffered no loss. It treated the future benefits of the panels as forming part of the consideration for the sale and used the calculation in Hodgson v Creation Consumer Finance Limited to quantify that benefit.

The appeal challenged the adequacy of the reasons, the treatment of benefits received after sale, the finding that the panels increased the sale price, and an alleged finding of failure to mitigate. The central issue was whether the lower court’s reasoning and conclusion were legally or procedurally defective.

1. Outcome. The appeal was dismissed. The County Court had given sufficient reasons and was entitled to conclude that the claimant’s benefits exceeded the costs of the solar-panel transaction.
2. Appellate review. Under CPR 52.21(3), an appeal proceeds by way of review. The court may intervene only where the decision was wrong or unjust because of serious procedural or other irregularity. On adequacy of reasons, the question was whether, reading the judgment with the evidence and submissions, it was apparent why the judge reached his decision. Applying English v Emery Reimbold & Strick Ltd, it was.
3. Benefit from the sale. The judge had not required the claimant to account for energy savings or FIT payments received after she ceased to own the property. He found instead that the panels increased the sale price and that this increased price was a benefit actually received by the claimant. That benefit had to be included in the loss calculation.
4. Assessment of value. The judge was entitled to use the Hodgson calculation as the best available means of assessing the increase, given the absence of expert valuation evidence or a separate apportionment of the sale price. The court stressed that this was a rough and ready assessment on unusual facts and should not be treated as a precedent for routinely using that calculation. Expert evidence or comparable sales would ordinarily provide a more secure basis.
5. Findings of fact and mitigation. Applying the approach in Volpi v Volpi, the trial judge was entitled to attach little weight to unsupported evidence about a neighbouring property and to treat the conveyancing enquiries as relevant evidence. Weight was for the trial judge. The judge had not found a failure to mitigate. His reasoning concerned a benefit received through the sale, not a benefit the claimant had unreasonably failed to retain.

• High Court (King’s Bench Division): appeal from the County Court at Cardiff dismissed.
• County Court at Cardiff: on 13 January 2023, following a reserved judgment dated 12 January 2023, the claim was dismissed with costs after a fast-track trial.