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	England and Wales Court of Appeal (Civil Division) Decisions
You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Kensington Mortgage Company Ltd.v Carr & Anor [2011] EWCA Civ 1808 (07 December 2011) URL: http://www.bailii.org/ew/cases/EWCA/Civ/2011/1808.html Cite as: [2011] EWCA Civ 1808

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IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM BIRMINGHAM DISTRICT REGISTRY
(HIS HONOUR JUDGE PURLE)

		Royal Courts of Justice Strand, London, WC2A 2LL
		7 December 2011

Lord Justice Patten:

1. This is an appeal by Mr Carr against an order of His Honour Judge Purle QC made in the High Court in Birmingham on 8 April 2010.Error! Bookmark not defined. The judge, by that order, allowed an appeal of Mr Carr against part of an order of District Judge George dated 21 September 2009 under which the District Judge gave judgment in favour of the claimant against Mr Carr for the sum of £70,986.42 including interest, and directed that that sum should be deducted from the proceeds of sale of Mr Carr's property, 257 Huntington Terrace Road in Cannock in Staffordshire, together with various amounts in respect of costs. Under the same order, the claimant mortgage company was given leave to sell the property.
2. The action in which these orders were made were mortgage possession proceedings based on a joint mortgage over the property in favour of the claimant that was purportedly executed both by Mr Carr and his wife. A possession order was first obtained in March 2007 and executed in July of that year, but Mr Carr then applied to set it aside on the basis that his wife had forged his signature both on a transfer of the property from his sole into their joint names and subsequently on the mortgage in favour of the claimant.
3. Those allegations were accepted when the matter came to trial, but the claimant in the alternative sought to rely on the fact that its loan under the forged charge had been used to pay off various debts of Mr Carr and this should be subrogated to the rights of those creditors. These included a sum of £28,000 paid to discharge a prior mortgage in favour of the Nationwide Building Society and a sum of £3,300 paid to First National Bank to discharge a mortgage in their favour.
4. The District Judge also held that Mr Carr had been unjustly enriched in respect of the sum of £6,108 obtained from Southern Pacific Mortgage Lending which, on the judge's findings, had been applied for his benefit and a further sum of £21,681 obtained from a lender known as I-Group.
5. The District Judge held that the claimant was entitled to be subrogated for rights of the secured creditors and that Mr Carr must pay to Kensington out of proceeds of sale the amount of the unsecured loans applied for his benefit. Mr Carr then appealed and Judge Purle varied the District Judge's order by deleting from it the sums of £6,108 and £21,681 that I have mentioned and substituted for them a single sum of £7,500 which was held to represent the amount by which Mr Carr had been unjustly enriched on account of that sum being paid to his solicitors to pay the costs on his divorce from his first wife.
6. Mr Carr sought permission for a second appeal on a number of grounds, some of which challenge the basis and circumstances in which the original possession order was made, but, after considering the papers, I gave permission on one ground alone which relates to the £7,500. Mr Carr was able to produce evidence showing that he was legally aided in his divorce proceedings with a nil contribution and did not therefore use the £7,500 to pay his legal costs. I therefore gave permission to appeal on that ground and allowed him to adduce his new evidence.
7. Kensington have now seen this evidence and they accept that they are not entitled to a judgment in respect of the disputed sum. They wrote to Mr Carr and the court on 11 November 2010 enclosing a consent order which reduced the sum specified in paragraph 9(b) of the District Judge's order to £38,015.24 plus interest and made similar adjustments to the sums in paragraph 5 of Judge Purle's order in order to deduct the £7,500 plus interest which was the subject matter of the appeal.
8. For completeness, I should mention that Mr Carr in February this year applied to Lloyd LJ for permission to appeal on the grounds on which I had refused permission on paper. Lloyd LJ indicated in his judgment that he was not minded to grant permission on those grounds but he did highlight a reference in the summary of work document provided by Kensington's solicitors which appeared to indicate that they had discussed the matter with District Judge George at some point in September 2009. Lloyd LJ thought that although there was probably an innocent explanation for this, it was nonetheless something to be investigated and, on that basis, he adjourned the application until after that investigation had taken place.
9. The court then received letters from both the District Judge and from the solicitors which confirmed that the only contact between them occurred after the hearing on 21 September, when the District Judge asked Cobbetts to resolve a query about the computation of interest.
10. In these circumstances, there was nothing in the point which assisted Mr Carr on his appeal and on 22 June this year Lloyd LJ dismissed the renewed application for permission to appeal on the remaining grounds in the notice of appeal.
11. It follows that, in my judgment, Mr Carr's appeal must be allowed on the ground on which he was granted permission and I would make an order in the form which has now been handed up to us by Mr Ogden. The figures in that do not differ from the draft order that was submitted back in November last year.
12. Mr Ogden submits that had the evidence that Mr Carr has now been able to adduce been adduced at the trial, the appeal would have become unnecessary. As a fall-back position, he submits that, on any view, following the concession made in the letter of 11 November what Mr Carr should have done was to have agreed to withdraw his appeal on the terms set out in the draft order and therefore it is said that there should be no order for costs in respect of the appeal.
13. For my part, I think that, notwithstanding arguments about whether or not the evidence could or should have been produced at the trial as to which we really have no material to go on, the right order for costs is that Mr Carr should have his costs of this appeal up to 11 November 2010 and that thereafter there should be no order for costs.

Mr Justice Mann:

14. I agree.

Lord Justice Longmore:

15. I agree also.

Order: Application granted