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Jersey Unreported Judgments |
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You are here: BAILII >> Databases >> Jersey Unreported Judgments >> Morelli v Morelli and Wagland and Ors [2021] JRC 228 (26 August 2021) URL: http://www.bailii.org/je/cases/UR/2021/2021_228.html Cite as: [2021] JRC 228 |
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Damages - reasons for refusing leave to appeal.
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Before : |
Sir William Bailhache, Commissioner, sitting alone |
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Between |
Marino Morelli Mario Morelli |
Plaintiffs/Respondents |
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And |
Leonardo Morelli Giannina Morelli Wagland |
Defendants/Applicants |
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And |
Lower Bridge Street Investments Limited Richmond Nominees Limited Mayfair Nominees Limited |
Parties Cited |
Mr Marino Morelli for the Plaintiffs.
Advocate J. M. Sheedy for the Defendants.
judgment
the COMMISSIONER:
1. On 23rd August 2021, judgment was handed down in respect of the Defendants' application for an order for an inquiry into damages pursuant to undertakings given by the Plaintiffs when obtaining interim injunctions ex parte as ordered by the then Deputy Bailiff, Mr T J Le Cocq on 22nd June 2016. The application was refused for the reasons set out in the judgment and an order for standard costs made in favour of the Plaintiffs against the Defendants, to be taxed if not agreed (Morelli v Morelli and Wagland [2021] JRC 221).
2. The Defendants also applied for leave to appeal against my decision. I refused that application with reasons reserved. This judgment contains those reasons.
3. The test to be applied in deciding whether to grant permission to appeal is well settled and can be taken from the decision of the Court of Appeal in Crociani v Crociani [2014] (1) JLR 426 at paragraphs 50/51. In summary, in order to obtain permission to appeal the Appellants must show:
(i) that the appeal has a real prospect of success;
(ii) that a question of general principle falls to be decided for the first time; or
(iii) that there is an important question of law upon which further argument and a decision of the Court of Appeal would be to the public advantage.
I apply that test in this application.
4. The grounds on which Advocate Sheedy submitted that leave to appeal should be given were two-fold:
(i) In dividing the question of leave to proceed with an inquiry and quantum, the Court has in effect denied the full Court (including Jurats) the right to assess causation. In other words, the application should have proceeded with Jurats; alternatively, perhaps, I should not have considered questions of causation as an English judge would do at this stage and instead have referred those to the inquiry itself.
(ii) The Plaintiffs must have known that administrative costs would be incurred in the maintenance of the First Party Cited, and so those costs were clearly within their contemplation under the rule in Hadley v Baxendale [1854] 9 Ex 341. Furthermore, no professional administrator would have taken the risk of stepping down in breach of the injunction and it was, therefore necessary for the Defendants to issue their summons; and they should not have held against them the fact that they did so, and did not simply rely on the argument, ultimately upheld by this Court, that the effect of the Consent Order and the Monaco proceedings taken together was that the undertakings that they had given no longer applied.
5. I take the second ground first.
6. No argument was taken with the summary of the law as set out in the judgment handed down in respect of the application for an inquiry. It follows that the second ground asserted does not give rise to any question of general principle which falls to be decided for the first time or where there is a question of law upon which further argument and a decision of the Court of Appeal would be to public advantage. The only question in relation to this ground of appeal is whether it has a real prospect of success.
7. Advocate Sheedy did not contend on the application for leave that the administration costs incurred in respect of the First Party Cited fell within the first limb of Hadley v Baxendale namely that the costs were liable to result from the injunction. I do not consider that they were liable to result from the injunction itself. They were costs which arose before the proceedings were contemplated and in my judgment, therefore, cannot be said to have arisen from the injunction. It follows that they would need to be claimed under the second limb of Hadley v Baxendale, namely on the basis the Plaintiffs should reasonably have contemplated that these expenses would necessarily continue to be incurred as a result of the grant of the injunction when otherwise they might not. In my judgment, there was no evidence before me on which I should reasonably have reached that conclusion and accordingly I do not consider that the appeal on this ground has any real prospect of success.
8. Furthermore, a quite separate reason for not ordering the inquiry into damages was the discretionary reason set out in the judgment handed down. Even if I were to be wrong as to whether the losses claimed fell within the second limb of Hadley v Baxendale, the discretion reason for refusing to order an inquiry has not been challenged in the proposed grounds of appeal; and I will return to that point shortly.
9. The first ground which Advocate Sheedy urged upon me was that I had in effect no right to deal with the matter without Jurats because I had taken causation matters into account in deciding whether leave should be granted. This either meant the whole application for leave to proceed with the inquiry should have proceeded with Jurats or, if I dealt with it as a single judge, I should not have addressed issues of causation but left those to the inquiry. Essentially, this argument depends upon a construction of Article 15 of the Royal Court (Jersey) Law 1948 (the "Law") which is in the following terms:
10. It was not suggested by either party either before or at the time the application for an inquiry into damages was heard that this hearing should take place before Jurats. I consider that this was the correct approach. The decision as to whether to order an inquiry was a procedural decision, involving the exercise of a discretion, as many procedural decisions do, and accordingly, by virtue of Article 15(1)(a) of the Law, it was a question of law. Jurats therefore should not have been involved in that decision. Courts do not exercise a discretion in a vacuum; and in the present case the decision was made against the backdrop of facts put before the Court. I do not think it would be easy to draw a line between the current case and other cases where a procedural discretion is being exercised and I do not consider that there is any question involving the facts which requires to be determined by Jurats in relation to the current application at this stage. In my judgment, there is a broad question of law/procedure as to whether the damages claimed should generally be treated as falling within the rules in Hadley v Baxendale, and a more precise question as to whether the detailed quantum claimed fell within those rules; the latter is for the Court including Jurats, and the former is a question of law even though it involves an assessment (but not a determination) of the facts.
11. This is a jurisdictional question with which the Court is familiar. The Court regularly has to make an assessment as to whether Jurats are needed for any particular hearing. In my judgment, it is not the type of decision with which the Court of Appeal should usually be troubled, notwithstanding that it raises questions of jurisdiction.
12. This is particularly so in the present case because of the discretionary element in the decision I have taken, which as I understand the argument would be for me as a single judge in any event, as to which I would just add this.
13. Advocate Sheedy accepted that the exercise of discretion was a gateway question which fell to me as a single judge on this application. He had previously accepted that progress or otherwise in the administration of the Mrs. Morelli's estate was a matter which I was entitled to take into account in considering whether or not to grant the application for an inquiry. When pressed with this point, relevant to whether or not the appeal would stand any realistic prospect of success, he contended that the Defendants did not appreciate that what was being requested by the Court on 30 July 2021 was full information as to the administration of the estate.
14. In my judgment this was not an objection which he could sustain. The process was not unfair to the Defendants. They ought to have anticipated from the outset that the Plaintiffs would inevitably complain about their lack of cooperation in the administration of the estate, which was not unexpected as indeed Advocate Sheedy conceded before me, or that the Court itself would be concerned at the obvious lack of progress in that administration, which forms part of the wider picture of the dispute between these parties. In other words, the Defendants ought to have been ready to address the question of the estate administration at the time of their application. When the Court asked to be addressed prior to 30th July 2021 on the extent of the evidence as to the administration of the estate, it should also have become apparent that there was relatively little evidence before the Court; and that was the opportunity for the Defendants either to produce the evidence or to apply for an adjournment so that the evidence could be produced, on the assumption that if produced it would favour them. However, no application for an adjournment was made and the only information provided to me was the correspondence referred to in paragraph 42 of the judgment. In passing, I add that no objection is taken by Advocate Sheedy with the summary of the estate administration as set out in paragraph 42, although he contended, without elaboration, that it was not complete.
15. Having regard to these considerations, I conclude that there is no realistic prospect of an appeal succeeding in relation to the exercise of discretion. I consider I have a good handle on where these parties are in relation to the estate of their late mother, and, as indicated in paragraph 46 of my judgment, I am not comfortable with ordering an inquiry into damages.
16. For these reasons I have refused leave to appeal.
