Saxby Finance Limited v Daphne Evadne Portia O'Connor Baker

An appellate court should interfere with a trial judge’s decision only where it was wrong or unjust because of serious procedural irregularity. Pleadings must give fair notice of the issues, but case management remains a pragmatic and evaluative exercise. A court assessing an unfair creditor-debtor relationship under the Consumer Credit Act 1974 must consider the relationship holistically, including the creditor’s conduct and any inequality of knowledge. The remedial discretion under section 140B is broad and aims to remove the causes and financial consequences of unfairness, without requiring a conventional assessment of causation and loss or conferring a windfall. However, an award must be sufficiently explained. Where the reasoning does not make the quantified remedy intelligible, the remedy should be set aside and remitted.

Saxby Finance Limited appealed from a County Court judgment concerning a commercial bridging loan made to Ms Baker. The County Court found an unfair creditor-debtor relationship under the Consumer Credit Act 1974, made a reduced money order, dismissed a possession claim, and awarded Ms Baker damages for an unauthorised disclosure of personal financial information. Saxby challenged the unfair-relationship finding, the remedy and costs. Ms Baker sought permission to appeal the money order, data-protection damages and costs. The central issues were whether the trial judge had fairly defined and tried the unfair-relationship case, whether the finding was sustainable, whether the statutory remedy was adequately reasoned, and whether the consequential costs order could stand.

1. Appeal standard and pleadings. Under CPR 52.21(3), an appeal lies where the decision was wrong or unjust because of serious procedural irregularity. Pleadings must identify the issues sufficiently to permit a fair trial, but a trial judge may permit departure from a pleaded case where justice requires. The judge’s broad and pragmatic approach was permissible. Saxby had fair notice of the factual matters relied on and identified no material prejudice. The pleading challenge therefore failed.
2. Unfair relationship. The court must make a broad and holistic assessment of the whole creditor-debtor relationship. A sufficiently extreme inequality of knowledge and understanding may be a classic source of unfairness. The trial judge was entitled to find unfairness from Saxby’s failure to tell Ms Baker that Aldermore had refused consent to a second charge, its superior knowledge of the resulting refinancing jeopardy, and its failure thereafter to engage constructively with her attempts to resolve the debt. The finding was within the range of sustainable decisions and both grounds of Saxby’s appeal were dismissed.
3. Remedy. Section 140B confers a broad discretion directed to removing the causes of unfairness and reversing its damaging financial consequences. The debtor is not entitled to a windfall, but strict contractual analysis of causation and loss is unnecessary. The trial judge adopted a permissible overall approach, but the detailed calculations did not adequately explain the final £25,000 award. Saxby’s appeal and Ms Baker’s cross-appeal were allowed to that extent, the remedy was set aside, and the issue was remitted.
4. Data protection and costs. The £1,500 data-protection award was not arguably wrong and permission to appeal it was refused. The costs order was set aside consequentially on the remission of remedy, with costs to be redetermined after the fresh remedy decision.

• High Court (King’s Bench Division): Appeals from the County Court at Bristol were determined. The unfair-relationship finding was upheld. The statutory remedy and consequential costs order were set aside and remitted for redetermination. The application concerning data-protection damages was refused.
• County Court at Bristol: Found an unfair creditor-debtor relationship, made a reduced money order, dismissed the possession claim, awarded data-protection damages and awarded Ms Baker 15% of her costs.