Ebele Muorah v Secretary of State for Housing Communities and Local Government & Anor

Bankruptcy may prevent an appellant from continuing a statutory planning appeal where the relevant cause of action has vested in the trustee in bankruptcy and has not been assigned back. The court may strike out the appeal as an abuse of process because the bankrupt no longer owns the cause of action. That conclusion may be reached without deciding whether the bankrupt retains an interest in the land for the purposes of the planning legislation. Potential defects in the underlying planning decision do not preserve the bankrupt’s right to pursue the appeal. A local planning authority may nevertheless withdraw, waive or relax an enforcement notice under section 173A of the Town and Country Planning Act 1990, including after the notice has taken effect.

The appellant brought a statutory appeal under section 289 of the Town and Country Planning Act 1990 against the Secretary of State’s decision on an enforcement notice appeal under section 174. The enforcement notice concerned alleged unauthorised development and a material change of use at residential premises.

The Secretary of State accepted that the inspector’s decision was unlawful on one ground, concerning the failure to consider the effect of a requirement to remove kitchen and cooking facilities. The appellant did not agree to judgment limited to that ground. While the section 289 appeal remained pending, she was declared bankrupt, the property vested in her trustee in bankruptcy, and the trustee later disclaimed the property. The central issue was whether the appellant could continue the appeal after the cause of action had vested in the trustee.

1. The appeal was struck out. On bankruptcy, the property comprised in the bankrupt’s estate vested in the trustee under section 306 of the Insolvency Act 1986. The appellant’s cause of action in the section 289 appeal also vested in the trustee and had not been assigned to her.

2. Applying Pickthall v Hill Dickinson [2009] EWCA Civ 543, proceedings brought or pursued by a person who knows that the cause of action belongs to someone else may constitute an abuse of process. Pathania v Adedeji [2014] EWCA (Civ) 681 confirmed that an action does not automatically abate after vesting in a trustee and may in principle be regularised by joinder or assignment. Any such course is discretionary and requires regard to the interests affected, including creditors.

3. The trustee had been given time to consider the position but had neither participated in the appeal nor assigned the cause of action. The appellant therefore no longer owned the cause of action and could not continue the appeal.

4. It was unnecessary to decide whether section 289 separately required the appellant to retain an interest in the land. That issue did not arise because the appeal was struck out on the basis that the cause of action had vested in the trustee.

5. The possible reversal of the trustee’s disclaimer, or proof that the property was held on trust, would not alter the conclusion concerning the vested cause of action. The inspector’s decision therefore stood. The local planning authority could, if asked, consider exercising its powers under section 173A of the Town and Country Planning Act 1990 to withdraw, waive or relax the enforcement notice, taking account of the Secretary of State’s concession.

• Inspector appointed by the Secretary of State: determined the enforcement notice appeal by decision letter dated 9 December 2020, subject to corrections and variations, and dismissed the appeal.
• High Court: an earlier decision remitted the enforcement notice appeal for rehearing after identifying an error of law: [2020] EWHC 649 (Admin).
• High Court (Planning Court): struck out the section 289 appeal because the cause of action had vested in the trustee in bankruptcy.