Michael Burton v Ministry of Justice

Under Schedule 12 to the Tribunals, Courts and Enforcement Act 2007, a creditor may be ordered to pay damages for loss caused by an enforcement agent’s breach without proof that the creditor caused or contributed to that loss. The statutory reasonable-belief defence depends on the enforcement agent’s belief and protects both agent and creditor.

Where a private vehicle has not been replaced by hire, loss-of-use damages are assessed broadly for disruption and inconvenience. They need not reflect a spot hire rate. Such general damages may be recovered with proven special damages for reasonable alternative transport.

The claimant owed a magistrates’ court fine. The Ministry of Justice engaged an enforcement company, which engaged an enforcement agent to execute a warrant of control. The agent clamped a car despite being shown evidence that it was held on hire purchase and that the claimant had no beneficial interest in it.

A Deputy District Judge found that the car should not have been controlled, but held that the agent had a reasonable-belief defence and that no loss was proved. On the claimant’s first appeal, Her Honour Judge Richardson held that the Ministry was not liable as creditor and that the claimant had not proved loss. The claimant brought a second appeal on creditor liability and quantum.

1. Appeal allowed unanimously. Paragraph 66 of Schedule 12 to the Tribunals, Courts and Enforcement Act 2007 permits an order for damages against a creditor solely in that capacity where an enforcement agent breaches the Schedule. The statutory power contains no requirement that the creditor caused or contributed to the debtor’s loss.

2. The reasonable-belief defence in paragraph 66(8) confirms that conclusion. It protects both the enforcement agent and the creditor, but is engaged only by the agent’s reasonable belief. The creditor’s exposure under the paragraph therefore depends on the agent’s breach and defence, not on a separate common-law basis of agency, vicarious liability or assumed responsibility.

3. CES Limited v Marston Legal Services Ltd [2021] 1 QB 129 established that an enforcement officer or agent is not simply the creditor’s agent and acts with the court’s authority. It did not, however, address the distinct statutory damages power in paragraph 66. A creditor’s delegation of enforcement does not remove the statutory power to award damages against it.

4. The claimant was entitled to general damages for 29 days’ loss of use of the car and to special damages for alternative travel. Applying Beechwood Birmingham Ltd v Hoyer Group UK Ltd [2010] EWCA Civ 647, the appropriate general award for a private vehicle not replaced by hire is a broad assessment of disruption and inconvenience, rather than necessarily the spot hire rate suggested in Lagden v O’Connor [2002] UKHL 64. The claimant’s unchallenged sworn evidence of £180 transport expenditure was evidence of loss; the absence of receipts did not justify rejecting it. Judgment was entered for £905 plus interest.

• Court of Appeal (Civil Division): Allowed the claimant’s second appeal and entered judgment for £905 plus interest: [2024] EWCA Civ 681.
• County Court sitting at Kingston-on-Hull: Her Honour Judge Richardson dismissed the claimant’s first appeal, holding that the Ministry was not liable as creditor and that loss had not been proved.
• County Court sitting at Kingston-on-Hull: Deputy District Judge Burman held that the vehicle was not the claimant’s beneficial property, but found a reasonable-belief defence and no proved damages.