COURT CANNOT RE-OPEN “FINAL JUDGMENT”: ISSUES RELATING TO DEFENDANT’S CAPACITY: EVESHAM –v- WERRETT CONSIDERED

In the judgment today  in Eversham & Pershore Housing Association Ltd -v- Werrett [2015] EWHC 1060 (QB) Mr Justice Nicol held that the court could not re-open a decision because of later evidence in relation to the defendant’s capacity.

THE CASE

The claimant housing association brought possession proceedings because of the defendant’s anti-social behaviour.  An injunction was granted against the defendant and a possession order was suspended on terms.  In later proceedings the defendant admitted breaches of the injunction and a warrant of possession issued. The defendant applied for the warrant to be suspended.

KEY POINTSkey-214453_1280

  • The judge did not have power to re-open a final decision made after a hearing unless there were exceptional circumstances.
  • It was open to the judge to conclude, on the written evidence before him, that the defendant had capacity.
  • If a party wanted an adjournment to allow an expert witness to be cross-examined then the application should have been made at first instance and was not a point that could be raised on appeal.

THE ISSUE: RE-OPENING A PREVIOUS DECISION IN RELATION TO CAPACITY

Concerns arose in relation to the defendant’s capacity. On the 19th May 2014 the circuit judge held a hearing and determined that the defendant had capacity to litigate. The defendant then obtained further medical evidence and applied to the judge on the 25th July 2014 to vary the order made in May.

THE DECISION: THE COURT DID NOT HAVE POWER TO RE-OPEN THE ORDER

Did the Judge have power to re-consider his decision of 19th May that the Defendant was not a protected party?

  1. Rule 3.1(7) of the CPR provides that:

‘A power of the court under these Rules to make an order includes a power to vary or revoke the order’.

Mr Shepherd argues that this gave the Judge sufficient power to vary or revoke his earlier ruling.

  1. Mr Underwood on the Claimant’s behalf submits, first, that the Judge was right to treat his decision of 19th May as a final order since it finally determined as between the Claimant and Defendant whether the Defendant was and had always been a person with sufficient capacity to conduct this litigation. As such, the Judge was right that he ought not to revisit it. Mr Underwood refers me to Roult v North West Strategic Health Authority[2010] 1 WLR 487 (CA) at [15] and Kojima v HSBC Bank plc [2011] 3 All ER 359 (Ch) at [33] – [34] for the proposition that, if there is jurisdiction under r.3.1(7) to vary or revoke a final order, it should only be exercised in exceptional circumstances. Mr Underwood argued that if the Defendant was dissatisfied with the Judge’s decision of 19th May he should have appealed that decision (and on that appeal, if he wished, sought permission to rely on the additional evidence of Dr Champion), but that was not what the Defendant had done. He was trying to appeal only the decision of 25th July.
  2. The White Book (2014 edition) at paragraph 3.1.9.1 says, ‘Final orders determine between the parties the issues which are the subject matter of the litigation and which give rise to a cause of action estoppel between those parties.’ Hamblen J adopted this definition in Islamic Investment Company of the Gulf (Bahamas) Ltd v Symphony Gems NV [2014] EWHC 3777 (Comm) at [108]. In the present case, the issues between the parties are (in summary) whether the Defendant breached the terms of his tenancy agreement, whether he behaved in such a way as to justify the grant of an injunction to prevent harassment and whether he has breached the injunction and terms of the suspended possession order.
  3. It may be said that the issue as to Mr Werrett’s capacity to litigate does not directly concern any of these issues. Cases such as Dunhill v Burgin (Nos. 1 and 2) [2014] 1 WLR 933 (SC) show that the subsequent realisation that a litigant lacks capacity may lead to the overturning of a previous settlement of a claim. In that case, Mrs Dunhill brought a personal injuries claim in 1999 which she settled in 2003 for £12,500 in full and final settlement. In 2009 she sought a declaration that she had lacked capacity and the settlement should be set aside because it had not been approved by the court as r.21.10 required. Her argument was upheld by the Supreme Court. Here (similarly to the 2003 settlement in Dunhill) the Defendant consented to the suspended possession order. Importantly, though, in the proceedings which Judge Harington decided on 19th May, he was asked to rule whether the Defendant had and at all material times had had capacity to conduct the litigation. If the Defendant had been successful in that application it would have impeached the suspended possession order since that would have been ineffective because (like the 2003 settlement inDunhill) it had been made without the court’s approval on behalf of the Defendant as a protected party. On 25th July the Defendant was trying to re-litigate the Judge’s final ruling as to whether those earlier stages of the proceedings could be re-opened.
  4. Mr Shepherd argued that the Court had elided what should have been a two stage process into one: that it should first have considered whether the Defendant was a protected party and, if that was resolved in the Defendant’s favour, gone on to consider whether earlier decisions, such as the suspended possession order, should be effective notwithstanding the absence of a litigation friend to act on his behalf when those earlier stages in the litigation took place. He referred me to r.21.3(3) which says, ‘Any step taken before a …protected party has a litigation friend has no effectunless the court orders otherwise.’ [my emphasis]
  5. In my judgment, though, there are three reasons why Judge Harington was right to take the course that he did. First, he had been asked by the Defendant to rule that the Defendant was, or had been at any material time, a protected party. The application thus concerned the past as well as the future. Secondly, that made practical sense. By the time this application was made, the litigation was at a very advanced stage. A suspended possession order had been made. By both the Defendant’s admission and the District Judge’s holding, its terms had been breached. A final injunction had been granted. It too had been broken (as established by the same combination of judicial holding and admission). The practical purpose of the application by the Defendant was to unwind what had so far happened in the litigation. Thirdly, in terms of the Defendant’s incapacity, it only made sense to consider the position retrospectively as well as prospectively. No one was suggesting that his condition had deteriorated since the commencement of proceedings. It was and had remained much the same since the time of his accidents in 1999. It would be unreal to treat him as lacking capacity in May 2014, but able to litigate on his own behalf in January, February, March and April 2014.
  6. Mr Shepherd argued that a decision as to a party’s capacity to litigate could not be a final decision because that would preclude the possibility of the issue being revisited if the party’s condition should deteriorate. However, that submission does not assist him in the context of the present proceedings. First, it needs to be re-emphasised, that it is not the Defendant’s case that his condition deteriorated between 19th May and 25th July. There is no evidence to that effect. Secondly, in the hypothetical situation which Mr Shepherd postulates, the court would not be asked to re-open its decision as to the past capacity of that party to litigate but, exclusively, whether for the future he should be treated as requiring a litigation friend.
  7. If, as I find, the Judge’s decision on 19th May was a final order, he would only have had power pursuant to r.3.1(7) to vary or revoke it in exceptional circumstances. The Judge considered whether there had been a material change of circumstance or whether any facts had been misstated at the time of the 19th May decision. He was applying the guidance in Tibbles v SIG plc (trading as Asphaltic Roofing Supplies) [2012] 1 WLR 2591 (CA). But that was generous to the Defendant. Tibbles concerned a case management or interlocutory decision. It distinguished Roultand Kojima precisely because they had concerned final decisions – see Tibbles at [38].
  8. There is very little help in the authorities on when r.3.1(7) may be invoked to vary or revoke a final decision, but if he cannot succeed on the Tibblescriteria he surely cannot succeed when a more exacting test has to be applied. I consider that the Judge was right to conclude that the Defendant could not satisfy either of the Tibbles tests. There was no evidence of a change in his condition between May and July (In this respect the present case is different from In Re F (A Child) (Return Order: Power to Revoke) [2014] 1 WLR 4375 (Fam Div) where there had been a sea change in the mother’s mental state since the order which she sought to vary – see [3]-[4]. The case also concerned a child, although I recognise that Mostyn J did not consider that to be a necessary feature see [22]). Nor, in the present case had anything been misstated in the May hearing. The Judge was right to say that all that had happened was that a further expert report had been produced. But if the Defendant wished to submit this made all the difference, the proper course was to appeal the May decision and try to establish that the well known criteria for the admission of fresh evidence on appeal were satisfied.
  9. Accordingly, I conclude that Judge Harington was right to say that he did not have power under r.3.1(7) to vary or revoke his order of 19th May.

THE CIRCUIT JUDGE WAS RIGHT  TO FIND THAT THE DEFENDANT HAD CAPACITY IN ANY EVENT

“Was the Judge right to conclude that the Defendant’s application in any case did not succeed on its merits?

  1. I shall deal first with the two preliminary matters raised by Mr Shepherd.
  2. He argued first that the Judge was wrong to allow the Claimant actively to oppose his application. In Folks v Faizey [2006] EWCA Civ 381 a judge had given case management directions for the trial of a preliminary issue as to whether the claimant required the services of a litigation friend. Expert evidence on behalf of the Claimant suggested he was not capable of managing his own affairs (the test under the Mental Health Act 1983 which was then the governing statute). The Defendant’s expert evidence suggested that he did. The Court of Appeal set aside the order for the trial of a preliminary issue. It noted that the Claimant consented to the appointment of the litigation friend and there was evidence to support the appointment. The application was made bona fide and the defendant would suffer no prejudice by the order sought. Consequently, the preliminary issue was unnecessary satellite litigation.
  3. Mr Shepherd also observed that it would have been open to the Official Solicitor to become the Defendant’s litigation friend without a court order by following the procedure in r.21.5.
  4. Once again, though, it seems to me to be important to focus on what this application was really about. The application notice sought to remove from Judge Harington’s order of 19th May the words ‘and at all material times has had [capacity to litigate]’. While this was only part of the relief which was requested, given the advanced stage of the litigation, it was the part which really mattered. If this part of the relief was granted then it would (at least potentially) lead to a reopening of the earlier stages in the litigation including the making of the suspended possession order and the admissions and findings of breaches of that order and the injunction. Plainly the Claimant had a legitimate interest in arguing why this part of the relief should not be granted. Because there was no evidence that the Defendant’s mental state had changed since the litigation began, the Claimant likewise had a legitimate reason to oppose the other forms of relief which the Defendant was also seeking.
  5. Mr Shepherd’s reliance on r.21.5 does not assist him. If that procedure had been adopted, without more, the previous steps in the litigation would have been unaffected.
  6. All of this is quite different from Folks v Faizey where the absence of prejudice to the Defendant from the appointment of a litigation friend was critical to the Court’s decision – see Pill LJ at [19], Keene LJ at [25] and Wilson LJ at [29].
  7. Mr Shepherd’s second preliminary point was that the Judge should have adjourned the hearing of the application when it became clear that the Claimant took issue with Dr Champion’s certificate. The certificate (devised by the Official Solicitor) invited the person completing it to go through each of the alternatives in s.3(1) of the 2005 Act, to state whether the litigant lacked that particular ability and then, in the accompanying box, to give their reasons. Dr Champion had signified that, in his opinion, the Defendant lacked each of the four abilities in s.3(1)(a)-(d). The Claimant’s argument was that the reasons that he gave in each case did not substantiate his conclusions. Mr Shepherd argued that this was to call into question Dr Champion’s evidence that those conclusions were justified and, in fairness, the challenge should have been put to Dr Champion in cross examination. However, at a case management hearing before DJ Singleton on 2nd July 2014 it was recorded that the Claimant did not require Dr Champion to attend the hearing of the Defendant’s application.
  8. The problem with this argument is that the Defendant, who was represented at the hearing before Judge Harington on 25th July, did not ask for the hearing to be adjourned so that Dr Champion could be called for cross examination. Mr Shepherd’s case has to be that the Judge erred because he did not take the initiative and, of his own motion, adjourn the hearing. I reject that argument. In an adversarial process where both parties are represented the Judge is entitled to rely on the parties to request an adjournment if they consider that is necessary for the fair disposal of the matter.
  9. In finding that the Defendant did have capacity the Judge said this,

’20. First I find that the evidence is that, albeit it is not as easy for [the Defendant] as it is for others, he is able to understand the information. The view of Dr Champion is that it is more difficult for him, but there is no suggestion that he cannot understand it. Secondly, that as to whether he is unable to retain the information, whilst he may not be able to retain it for very long, I find also that that has not been established. Thirdly, to use or weigh the information as part of the process of making the decision. In fact the decisions have already been made in this case, but again whilst it is established that he has more difficulty than others to weigh the information as part of the process of making a decision, I find that it has not been established that he has been unable to do that. So far as communicating his decision is concerned, I do not think that that arises in this case, although I accept Mr King’s [counsel who then represented the Defendant] point that it is not very easy to get instructions from him. Then subsection 2 continues, “A person is not to be regarded as unable to understand the information relevant to a decision if he is able to understand an explanation of it given to him in a way that is appropriate to his circumstances (using simple language, visual aids or any other means).”

21. Section 3(3) provides that “The fact that a person is able to retain the information relevant to a decision for a short period only does not prevent him from being regarded as able to make the decision.” That, it seems to me, rather undermines Mr King’s arguments about the Defendant being unable to put a time or a date or a period during which a particular incident took place. Section 3(4) says that information relevant to a decision “includes information about the reasonably foreseeable consequences of deciding one way or another or failing to make the decision.”

22. It seems to me, therefore, that Dr Champion does not establish that the Defendant lacks capacity. As Mr Underwood says in his skeleton argument, section 3 provides that a person is unable to make a decision for himself only in the circumstances to which I have referred and it does not seem to me that Dr. Champion goes as far as saying that. As to the arguments put forward by Mr King in relation to his attention difficulties, reduced processing speed, reduced sustained attention, his getting tired very easily and reduced information processing and post-brain injury fatigue. It is, as I have said, something that makes it very difficult for the Defendant, I accept that. And in giving this ruling it does not mean that I do not have sympathy for him so far as that is concerned. But on what I have heard and read I conclude that Dr Champion, as with Dr Bickerton, does not establish in his certificate that the Defendant lacks capacity. So on that ground as well the application, dated 4th July, is dismissed.’

  1. Mr Shepherd argued that the Judge had not sufficiently appreciated that Dr Champion had stated in terms (by ticking each of the boxes on the Official Solicitor’s form) that the Defendant lacked capacity in each of the four alternative ways set out in s.3(1) of the 2005 Act. Dr Champion had set out his reasons in each case. Furthermore, to satisfy any one of the alternatives, it was not necessary to show complete incapacity. That had been the case under the Mental Health Act 1983 – see Masterman-Lister v Brutton and Co [2003] 1 WLR 1511 (CA) at [18] – and remained the case under the 2005 Act. Dr Champion was a qualified psychologist and, as such, was in a good position to give an expert opinion on whether the Defendant lacked the abilities referred to in the 2005 Act – see G v E [2011] 3 WLR 652 (CA) at [60] – [61]. Dr Bickerton, the psychiatrist, had also certified that the Defendant lacked the first three abilities in s.3(1). Furthermore, the Court had the correspondence from the Official Solicitor who on two occasions had supported the applications that he be appointed as the Defendant’s litigation friend. Against all this evidence, the Claimant had adduced no expert evidence to show the Defendant did have capacity.
  2. The Defendant can only succeed if I consider that the Judge was wrong to reach the conclusion that he did – CPR r.52.11(3)(a). There was no oral evidence before Judge Harington. When he said in [22] of his judgment that he based his decision on what he had heard, he was referring to oral submissions from the parties. This is not a case, therefore, where the first instance judge had a particular advantage over me in making his assessment.
  3. The Judge said at [20] that ‘The view of Dr Champion is that it is more difficult for him [to understand information], but there is no suggestion that he cannot understand it.’ It could be argued that this was to overlook the box which Dr Champion ticked and which said ‘he or she is unable to understand the following relevant information…’ However, in my view, the Judge was entitled to treat this bald statement together with the elaboration in the box which immediately followed it. From this, it was apparent, as the Judge said, that the Defendant ‘struggled’ to take in information and could not concentrate for any lengthy period of time. However, as the Judge also noted, the statute directs that a person is not to be treated as lacking capacity unless all practicable steps have been taken to enable him to make a decision without success. The Judge was also able to take into account the certificate of Dr Bickerton who had said,

‘[The Defendant] has very limited simple understanding of the issues and is likely to become emotionally overwhelmed and volatile due to his brain injury.’

A little earlier in his certificate, Dr Bickerton had said,

‘Mr Werrett understands the allegations made against him and has the ability to decide whether to plead guilty or not but he may/will be unable to defend the proceedings, give evidence and cope with cross-examination; partly because of his intellectual difficulties, but also partly due to his great difficulty in managing his own emotions when under cross examination. He is likely to have the ability to instruct his solicitor in simple terms. I do, however, believe he would have difficulty in following the court proceedings without getting emotionally overwhelmed as he did in the recent court case. Likewise giving evidence in his own defence could be problematic for him and he is likely to be emotionally overwhelmed, which I think would be unhelpful to the court. I therefore conclude that his fitness is impaired and he does not have the mental capacity to plead.’

Taken overall, I do not think therefore that the Judge either misstated or misunderstood the evidence. Certainly, I do not think that his characterisation of Dr Champion’s evidence made his decision that the Defendant did have capacity wrong.

  1. Nor do I think that the Judge fell into the error of considering that the statute required total incapacity. In addition to the certificates of Dr Bickerton and Dr Champion, the Judge was able to see what the Defendant had been able to do (no doubt with the assistance of his lawyers). He had, for instance, provided two witness statements responding to the allegations made against him (I exclude from consideration the third statement which the Defendant made on 14th August 2014 since that was after the decision of Judge Harington which the Defendant is seeking to appeal).
  2. The Judge was well aware of the Official Solicitor’s views and his wish to be appointed as a litigation friend for the Defendant. He could not fail to be aware as well of the absence of expert evidence on the part of the Claimant. However, entirely properly, the Judge regarded it as his task to assess the evidence and decide whether it displaced the presumption in s.1(2) of the 2005 Act that the Defendant had capacity. On the material which was before him, I am not persuaded that he was wrong to conclude that it did not.
  3. Like the Judge, I have sympathy for the Defendant’s condition and the difficulties it creates for him. If there comes a time when the Defendant needs to give evidence, proper allowance will need to be made for that. When the adjourned hearing takes place to determine the appropriate penalty for his contempt of court, the Judge will have to weigh to what extent his condition affects his culpability and how, if at all, that should be reflected in any sanction which is imposed. However, these are all measures which can be adopted consistent with the conclusion of Judge Harington that it has not been shown that the Defendant is a protected party.

Conclusion

  1. For all of these reasons I do not consider that an appeal would have real prospect of success or that there is some other compelling reason why permission to appeal should be granted. Accordingly, the application for permission to appeal is refused.”

RELATED POSTS ON RE-OPENING ORDERS

POSTS ON CAPACITY

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