Monday, 31 January 2011

Everett & ors v Comojo (UK) Ltd t/a The Metropolitan & ors [2011] EWCA Civ 13: painful lesson

Does a nightclub have to protect its visitors?  Yes and no.  There you go, the perfect legal answer.

This is one of those cases where the Claimants come off particularly badly.  Not just because they lost, but because the casual reader might think that they brought their brutal treatment on themselves.  Simple enough story, they went to the Met Bar in Old Park Lane, a members- and guests-only bar.  The Claimants were the guests of a member, and took a particular liberty; one of them slapped a waitress on the jaxie.  Another member, Mr Balubaid, noticed this and was not impressed.  Mr Balubaid was a big spender and not known for violence.  But he did have a bodyguard. Interesting.

The waitress brushed off the incident, but Mr Balubaid told her that she would get an apology before the night was through.  A bit later Mr Balubaid asked the waitress to allow his driver to be placed on the guest list.  So she did, he turned up, had a tequila (perhaps he was not driving last night), shared a joke at the bar.  All well and good?

Not quite.  This “driver” made Mr Universe look like Jarvis Cocker.  The waitress thought that something may happen and went off to see the manager to warn him.  Too late.  Just as she left his office, she heard breaking glass.

What had happened was that the Claimants had decided to leave.  Mr Balubaid suggested that, before they do so, they wait to apologize to the waitress.  Mr Everett, the lead Claimant, responded in a way which suggested that Mr Balubaid should be on the point of micturating.  This was definitely the wrong answer.  The driver drove his fist into Mr Everett’s face.  And then chased the now-fleeing Claimants with a knife, caught them, and stabbed them several times.  Two of them suffered serious injuries, but recovered; the driver was sent down, initially for life, but is now out.

It was pretty obvious whom the Claimants should sue for their injuries.  The driver.  Only he had no money.  They could sue the driver's employer, Mr Balubaid.  Only he had gone AWOL and nobody knew where he was.  So they had to be a bit more creative.  They sued the security firm working the doors for letting a knife-wielding maniac in; struck out quickly, there was no likelihood of success, the knife was well hidden and there was no suggestion of negligence.  So they were stuck with suing the bar.  For negligently failing to keep its visitors reasonably safe.

To succeed in a claim, the Claimants had to show the Holy Trinity of tort law was satisfied. Duty, breach, causation.  Start with duty.  That in turn is the threefold test from Caparo v Dickman; foreseeability, proximity and fairness.  Could they nail these?  Foreseeability was easy – in a nightclub, people drink, when people drink, they get violent.  One down.  Proximity?  They couldn’t get more proximate than be in the very bar itself.  Two down.  Fair?  Yes – within limits.  The Court looked at the Occupier’s Liability Act 1957, which was about the state of the bar itself, and thought it would have been odd that a visitor who fell over a bit of carpet would be able to claim, but a visitor who was marmelized by a sociopath let in by the occupier would not.

So, duty was OK.  Problem is, the duty was not set very high.  Letting in a known sociopath was one thing; Mr Balubaid had no record of violence.  How far do you go in keeping ostensibly "normal" people out?  Had the bar reached the appropriate standard of a normal bar?  Which was to do what was reasonable in the circumstances?  Could the people there keep an eye on every visitor? 

Schools are not liable for playground accidents with appropriate supervision, even if this means a couple of teachers looking after a hundred children, as accidents will happen.  People cannot be kept 100% safe in all circumstances.  And in this case the Court held the bar had done enough.  The waitress had done the responsible thing, she had informed the manager, and there hadn’t been time to defuse the situation.  The Claimants suggested she shouldn't have wasted time with the boss and should have gone to the security guys.  The Court disagreed.  Why should she have informed security and have a valuable customer thrown out apropos of nothing?  The bar staff could not take pre-emptive action either.   The appropriate thing was to go to the manager, who would have experience of this sort of thing.  It wasn't the bar's fault that the situation escalated so quickly.

Therefore, there is a duty, but not too strong a duty.  A responsible bar should always be able to meet that duty with some ease.  Certainly the Met had – to the disappointment of the Claimants.  They had a sure-fire can’t-lose claim, certainly; but against the wrong people…

Tuesday, 25 January 2011

Clift v Slough Borough Council [2010] EWCA Civ 1171: I fought the law and…I won

There's a story that someone once rang one of those phone numbers on the back of a lorry under the question "how am I driving?"  Instead of being able to launch a tirade of complaints about said lorry's motorway menaderings, they got through to an operator who ended up trying to sell the haulier's product.  Remember: complaints departments are not necessarily there for your good...

Case in point.  Mrs Clift had a complaint.  She suffered a tirade of abuse from a drunk babysitter in a public park.  She contacted the Anti-Social Behaviour Co-ordinator at Slough Council.  One would have hoped that the Council would have re-considered the title, given that it suggested that the office incumbent was in charge of co-ordinating anti-social behaviour, but given the avalanche of apathy Mrs Clift received from said incumbent, culminating in Mrs Clift flinging her phone down so hard that she broke it, perhaps the description was accurate.

Mrs Clift now had two complaints.  Three, if one includes the brittleness of telephonic equipment.  So she wrote to the Council.  In somewhat vituperative terms.  “I felt so affronted and so filled with anger that I am certain I would have physically attacked her if she had been anywhere near me.”  Even though, as Mrs Clift said in the letter, she was not a violent person.  A threat better on the wind than in print, perhaps.  Because how did the Council respond?  By placing Mrs Clift on the Violent Persons Register.  And sending it out on a mass email.  To 66 members of the Council, a roadsweeping firm, a council housing repair firm, the local hospital and 50 businesses in the town centre.

So Mrs Clift sued for libel.  The Council defended on the basis that Mrs Clift WAS a violent person – she had threatened to use violence against a council worker – and, if that did not work, on the basis of qualified privilege.  The defence that protects the honest reference-giver or reporter-to-the-police.  You get it wrong, but you get it honestly wrong, and you don’t tell anyone you shouldn’t.  The Council’s defence on this looked quite decent.  It had sent the email out to a select audience, those who might deal with Mrs Clift and therefore might need to know of her apparent tendencies towards violence.

Thing is, it was a libel case, and so went before a jury.  The Court had to rule on whether the qualified privilege defence worked.  And the Court held that it did NOT.  Not fully, anyway.  Yes, it covered the emails to those who dealt with community safety; it did not cover the emails to the hospital, or the staff responsible for schools, or the roadsweepers and so on.  There was no need for those people to know about Mrs Clift’s burst of moral indignation.  They were never likely to meet her. 

The consequence of this was twofold.  Firstly, for Mrs Clift to win regarding the email being sent to those who needed to know, she had to show that the Council worker who drafted up the email was acting maliciously - malice beats qualified privilege.  She didn’t.  Secondly, for the Council to win on the email being sent to random rubbish-sweepers and stochastic store owners, it had to prove what it said was true - the only defence that would win in those circumstances.   If it could not, then Mrs Clift would win .  It couldn’t.  The jury, unlike the Council, did not see Mrs Clift as violent.  Mrs Clift was awarded damages of £12k.

The Council appealed.  Primarily on the basis that it was difficult for the Council to separate out those who had a need to know from those who did not.  And that its decision to send the Register to everyone was proportionate.  That argument didn’t work.  It wasn’t THAT hard to suss it out.  The Council ended up relying on the last refuge of the would-be damned – the Human Rights Act.  The Council had a human right to be on the safe side.  That argument didn’t work either.  Mrs Clift also had rights – the right not to have the Council wrongly paint her with a violent brush.  Appeal dismissed.

The big problem with this case, as ever, is not with libel itself.  The legal issues are quite clear; Mrs Clift may have been unwise in her choice of language, but does a truly violent person list in grammatical detail exactly how they would beat up their interlocutor?  Mrs Clift was complaining about the Council to the Council, and the Council decided to silence her by putting her on a list with the truly violent.  If Mrs Clift went off at the deep end, the Council was in the Marianas Trench.  A district judge could have reached that conclusion in perhaps half a day of seeing Mrs Clift in the witness box – and showing working for qualified privilege is the kind of thing you’d get in a law school exam.  Not difficult in the least.

No.  The problem is that of costs.  Estimates suggest the case – a twelve-grander, the sort of thing commercial lawyers would knock off in a few letters and which wouldn’t take up more than a day in Court – will set the Council back half a million quid.  Mrs Clift took advantage of a no-win no-fee arrangement – quite rightly, she had a good claim, as a jury found – but why should the case have cost so much and taken up so much time?  No wonder the Council appealed, even if it was just a negotiation tactic; but that appeal took up more Court time and maybe delayed another, more valid, appeal…

Monday, 17 January 2011

Hillside (New Media) Ltd v Baasland & Ors [2010] EWHC 3336: jurisdiction race

Remember the Slavia Prague case below?  This quick case shows how you can ensure English jurisdiction without any of the messy battles that took place in that one. 

Hillside is a subsidiary of bet365, and English.  Mr Baasland is a Norwegian with a gambling problem.  The others were other bet365 subsidiaries in the Netherlands Antilles and Gibraltar and brought in to avoid any loopholes.  The dispute was not really a dispute.  Mr Baasland had spent shedloads of money on bet365 and had had a winning streak like the Harlem Globetrotters’ opponents.  His bets were placed with bet365 in Norway, Germany, Denmark and the Czech Republic; bet365 processed those bets in England and Gibraltar.   So lots of international law there.

Having lost nearly £1.5m, Mr Baasland apparently had second thoughts about his gambling spree.  Not only had he blown his own assets, but loads of money his parents had borrowed.  So in 2008 he instructed Norwegian lawyers.  They wrote to bet365, stating that they would sue bet365 for negligence.  In Norway.

So bet365 decided to sue instead.  In England.  They issued proceedings early in 2009 for a declaration that it was not liable to Mr Baasland.  You can see how that works.  Once it’s in the English system, it’s up to Mr Baasland to challenge it – in England.  The Norwegian courts could not touch it, because Norway (as a member of EFTA) has signed up to the various conventions that ensure the Court first seised deals with the matter fully first. 

Mr Baasland was therefore at a huge disadvantage.  He challenged jurisdiction in England but never carried it through.  So bet365 proceeded to ask for summary judgment, on the basis that Mr Baasland had no chance of succeeding.  After some to-ing and fro-ing about whether England was the right place for the whole thing, the judge agreed to grant that summary judgment. 

The advantage of this is that Mr Baasland cannot now sue in Norway.  The matter has been considered and dealt with.  Any Norwegian proceedings would be a breach of European law and unenforceable in England.  (Or Gibraltar.)  Bet365’s tactic of being active, rather than passive, ensured that it was able to have a hearing on its home turf, in a legal system where its lawyers would know how things worked, where it's mightily difficult to get your money back from the bookie.  Saving costs and money; no need for bet365 personnel to head to Norway to give evidence, no need for the extra expense of interpreters and whatnot.  And getting the right result.  Although the Courts encourage people to avoid rushing off to issue claims, in this case bet365 did exactly the right thing.  Had Mr Baasland issued in Norway rather than writing to bet365 the matter might still be before the Norwegian court.  You snooze, you lose.  A familiar feeling for Mr Baasland.

Wednesday, 12 January 2011

Quinn v CC Automotive Group t/a Carcraft [2010] EWCA Civ 1412: well dodgy

Mr Quinn wanted to swap his silver Jag for a red one.  So he popped along to Carcraft.  He met a salesman there, a Mr Khan.  No red ones, I’m afraid, sir.  We do have this nice blue one.  Part-ex yours and for seven and a half k extra it’s yours.  I can arrange the financing for you, we just swap your current payments over.  OK, I’ll take it.  Deal done.

Then some good news.  Mr Khan on the phone.  We’ve got a red one now.  Mr Quinn went along to see it.  It’s not here now, sir, but here’s a picture on the computer.  Excellent, just what I need.  Deal amended.

The deals were thrashed out at a service station a couple of weeks later.  All signed up.  Car will be with you next week, sir.  And it was.  Just bring another £700 and it’s yours, sir.  Bit of trouble with the finance company.  You only have £400?  No problemo, we can settle that later.  No need to come into Carcraft, sir.  We can deal with it at the service station, it’s half-way between us.  I’ll even sort out your finance company.

Mr Quinn turns up at the service station, £400 in hand, Mr Khan is there with the red Jag.  Mr Quinn looks at it, sees no problem, hands over the money, drives off. And they all lived happily ever after.

Well, if “ever” means “a month”.

Anything strike you as suspicious about the above deal?  It all looks in order.  Maybe a little odd that it was done at a service station, redolent of football agents, bungs and Arthur Daley, but isn’t that a salesman being helpful to shift a pricey motor?   Don’t salesmen often go the extra mile to get their commission?

Thing is, Mr Khan was not being a salesman.  He was being a Rogue.  He promptly flogged the silver Jag on to an innocent punter and then “forgot” all about clearing the existing finance Mr Quinn had on it.  So the finance company chased Mr Quinn for the outstanding balance.  Mr Quinn was now paying for two Jags.  But he was a demi-Prescott.

Mr Quinn sued Mr Khan, and won.  Good luck in executing that judgmentMr Khan was a wisp in the wind.  Mr Quinn was therefore still several thousand out of pocket.  So Mr Quinn also sued Carcraft.  Hey, he was your salesman.  Hang on, you can’t blame us for THAT!  He wasn’t even on our premises when he did the deal.  No, Mr Khan was on a frolic of his own.  So we’re not liable.

Amazingly, the Court at first instance found in Carcraft’s favour.  The reason?  The deal was well dodgy.  Surely any purchaser would realise these deals are done on the forecourt and not at service stations.  The domain of the dodgy dealer and shady agent.  More to the point, why would Mr Khan do the deal when it looked like he was £300 short?  Because Mr Quinn didn’t have the full £700?  A second-hand car salesman turning down three hundred in bunce?  No way would Arthur Daley ever have done that.   That in itself should have made it obvious that Mr Khan was up to no good.  He was therefore not acting for Carcraft but on his own terms.

Less amazingly, the Court of Appeal overturned the first instance decision.  The principles of vicarious liability for the acts of an employee are well-established.  Did it look as if Mr Khan was acting within the course of his employment?  Yes.  Mr Khan was employed to sell cars, he was selling a car.  He introduced the deal on Carcraft’s premises.  Carcraft had imputed knowledge of what was going on.  More to the point, let’s assume that Carcraft had no knowledge about Mr Khan and his somewhat shady past.  In which case Mr Quinn and Carcraft were both innocent victims of Mr Khan’s activity.  One of them should bear the loss.  Which one?  As Hold CJ put it way back in the 17th century, “it is more reasonable, that [the master] should suffer for the cheats of his servant than strangers”. 

This maxim can only apply of course if the servant is acting with the ostensible authority of the master.  Good luck in suing Barclays if one of their counter staff sells you an iffy DVD.  And Mr Quinn would obviously see Mr Khan had Carcraft’s authority.  He was in their internets, pimping red Jags.  No doubt that it was reasonable for Mr Quinn to assume everything was above board.

So, based on 300 years of authority, the Court of Appeal readily found Carcraft liable.  A bit unfair, perhaps?  Because Carcraft unknowingly employed a Rogue?  Not quite – Mr Khan had moved from Rochdale’s Carcraft branch after he had been involved with the coppers… 

Monday, 10 January 2011

Clarke v Meadus [2010] EWHC 3117 (Ch), Gill v Woodall & others [2010] EWCA Civ 1430: wills and won’ts

So.  You’re about to die, you want to distribute your assets.  You make a will, it’s prepared by solicitors, it’s properly executed.  No problems?

Yes problems.

The law steps in on many occasions to protect disappointed beneficiaries.  Public policy will not allow children to go destitute so that a gold-digger can live in luxury for three months’ companionship.  To that extent you are not allowed to give everything away as you see fit.  And the same applies if you tell person A you will leave everything to them, they move heaven and earth to help you in your descent, and then you leave everything to person B.

That’s what happened in Clarke.  Almost.  Mrs Meadus has not yet died.  But it helps to sort these things out when you’re alive. 

The facts, as ever, are beguilingly simple, but disputed.  Mr and Mrs Meadus had two children.  Mr Meadus fell terminally ill in 1994; the Meaduses invided their eldest daughter, Mrs Clarke, to move in with them to help them.  Which she did.  Mr Meadus died in 1995.  As a result of his will, and various tax planning moves, Mrs Clarke became the half-owner of the Meadus house, and Mrs Clarke sold her own family’s home to move in permanently.

The problem emerged later.  There seems to have been a falling out.  So to protect her position Mrs Clarke issued proceedings to declare that she had an interest in the other half of the Meadus house.  Mrs Meadus opposed the application, saying it was part of a family trust.

Mrs Clarke said that the house could not be part of a family trust, because the Meaduses both promised she could have it when they were both dead; and Mrs Meadus had encouraged Mrs Clarke to move in on that basis.  It would be unfair for her to lose out, and lose her home, because of a change of heart.  Mrs Meadus disagreed with these particular submissions, and moved to strike the claim out as having no chance of success.  Rather surprisingly, it was.

On appeal the claim was reinstated.  The Court rightly held that there were serious issues of fact to consider, and this could only be done at trial.  Striking out – summary judgment – is only if there’s no dispute on the law.  Although the Master dealing with the case did find issues of law that were decisive, the High Court was most unimpressed.  Mrs Clarke had done something to her disadvantage; she had uprooted herself from her own home, and then gone on to sell it, which meant that at the very least the Court owed her an inquiry as to whether that was a reasonable reaction, and was on the basis of a promise made to her.  The Court therefore reinstated the claim – unless settled, it will proceed to trial.  If Mrs Clarke wins, Mrs Meadus will not be able to leave her half of the house to whomever she chooses – that choice will have been made by the law, based on Mrs Meadus’ decisions some years ago.

So, there’s one case where the will of an individual may be overturned; the Gill case is one where a will was.  The Claimant, Dr Gill, is the only daughter of John and Joyce Gill.  In 1992 the Gills made mutual wills, leaving their property to the RSPCA.  Mutual wills?  The parties making the wills agree to make them identical, so that all of their joint property goes to the ones they have jointly chosen.  Stops the widower taking all of the deceased wife's earthly goods and leaving them to a pneumatic hostess.  What a mutual will does is prevent the survivor from changing the will.  Which is what the Gills wanted.  John Gill died in 1999; the mutual will doctrine thenceforth essentially froze Joyce Gill’s will as it was then, she could not change her mind as it would be unconscionable to do so.  And she did not.  She died in 2006 and the RSPCA claimed its share.

Dr Gill had other concerns though.  She was not certain whether her mother truly knew what she was doing when she signed off her will.  She thought that perhaps her father had brought too much influence to force her to sign, so it was not truly her “will”.  More to the point, the same problem as Mrs Clarke reared its ugly head; Dr Gill could lose her home as a result – she had bought land next to the Gills’ farm and built there.  She only moved there because she was promised the farm…

The Court found in Dr Gill’s favour; the RSPCA appealed.  The Court of Appeal refused the appeal.  Mrs Gill had constantly expressed the wish that the farm would be enjoyed by a line of Gills to the crack o’doom.  Mrs Gill was somewhat agoraphobic and would not have been happy in a solicitor’s office having complex legal provisions explained to her.  And she didn’t like the RSPCA much.  Time-wasting townies, she called it.  Why would a woman leave her million quid asset to a charity with which she did not sympathize and leave her daughter potless?  The Court found that John Gill basically overbore Joyce Gill’s will (literal and figurative sense) and pretty much forced her to sign away the farm.  Therefore, regardless of what was written down, Mrs Gill’s will was not truly her will.

Not much in the way of new law there.  Merely stating what already happens in more conventional cases.  But it demonstrates the importance of getting things right in wills sometimes years before you need to rely on them…

Tuesday, 4 January 2011

Hassan-Daniel v HMRC [2010] EWCA Civ 1443, The Scout Association v Barnes [2010] EWCA Civ 1476: risks

You have two cases before you.  One is brought by the widow of a drug smuggler who died when dozens of bags of cocaine exploded in his innards, who wants to sue Customs for not saving his life.  The other is brought by a boy injured in a scout’s game when the scoutmaster had them running around in the dark.  Which one wins?

No, I'm not that transparent. Certainly the boy won his.  Running around in the dark?  Inherently dangerous?  Yes.  There was sufficient light for everyone to see vaguely what they were doing.  But not clearly enough.  The Court did find that, had the lights been on, the boy would have seen the wall…

It was a close-run thing though.  2-1.  The Court of Appeal seems to be becoming increasingly frustrated with ambulance chasing.  There have been a number of cases recently, e.g. Tomlinson v Congleton BC, where the Court has said that people have to take responsibility for their own actions.  If there’s a sign saying “no diving, it’s dangerous”, and someone goes ahead and dives, it’s 100% their fault.  They shouldn’t sue the council for not fencing the area off.  There must be some public amenity for people.  If that involves risks, hey, if you’re not living on the edge, you’re taking up too much room.

And in the Barnes case Jackson LJ put a powerful judgment in favour of the Scout Association.   “It is not the function of the law of tort to eliminate every iota of risk or to stamp out socially desirable activities.”  He looked at the policy reasons behind having rough-and-tumble games and decided that the slightly increased risk of injury was OK, because the Scouts provide a public benefit. 

However he was outnumbered.  Smith LJ thought it was a simple question.  Yes, some risk is good.  But that doesn’t mean you can get away with any risk on the basis that it weeds out the untermensch.  In the Barnes case, turning out the lights made it more exciting, yes – but it didn’t add any societal benefit.  It was, for want of a better word, daft.  And with her Ward LJ, somewhat reluctantly, agreed.

The closeness of the decision, and Jackson LJ’s judgment being longer than the other two put together, suggests that the case might go to the Supreme Court; even if Barnes ends up holding on to his slender lead, there may be some more clear guidance on what level of risk is appropriate when weighed against social benefit.

There’s not much social benefit in drug smuggling.  Swallowing them to get through Customs is certainly a risk that one should not take on.  Not only did Anthony Daniel swallow 116 packages of raw cocaine, he then kept shtum about it, even when arrested and x-rayed, apparently on the basis that he would be let go if he said nothing.  And then he went on hunger strike so he didn’t reveal his stomach contents via coprolitic analysis.  Add to this a heart weakened by drug use and an 11 year sentence he’d not long finished for drug smuggling, and you have a prime case for the Darwin Awards.  After his inevitable death, his widow sued Customs…

Surely she should lose.  Customs applied to strike it out on the basis that the case was not only hopeless, but that it arose out of criminal behaviour, and one shouldn’t be allowed to profit from it.  Reluctantly, the Court of Appeal refused to strike it out.  For sound legal grounds.  Had Mr Daniel admitted the crime and asked for help getting a kilo of coke from his intestines, and Customs refused, surely there should be a claim against Customs there?  Would that mean that you could do what you liked to criminals?  Someone has a heart attack when parked on a double yellow in a hospital – should the medics be able to refuse to help?  Conversely, if someone were arrested by mistake, and then refused to take essential medicine, there WOULD be a claim, even though the resulting harm would be nothing to do with the police…

It's a powerful blow against the principle of ex turpi, i.e. that you should not be allowed to sue if your damage comes out of something criminal you're doing.  In fact, it's difficult to see, if this case is not overturned on appeal, just how anyone could ever rely on an ex turpi defence.  In Daniels it is eminently possible for the Supreme Court to state that Daniels' crime should prevent any claim; an "honest" smuggler who begged for treatment could be considered a different category, as the request for treatment would be a different and perhaps intervening event - OK, he did wrong, but a refusal to help would not be from the criminal act itself; more from a clear, separate decision.   

There may be no point in appealing the decision.  The regrets expressed by the Court of Appeal is simply because the case is, on the face of it, utterly hopeless.  But that’s a matter for trial, with full-blown witness evidence, and it is just about possible that some more evidence may yet come out.  Unlike the cocaine.