Dear Colleagues;
For those interested in civil liability for breach of statutory duty, I have just noticed an interesting decision of the EW Court of Appeal, in
Trustee In Bankruptcy of
Louise St John Poulton v Ministry of Justice [2010] EWCA Civ 392 (22
April 2010) http://www.bailii.org/ew/cases/EWCA/Civ/2010/392.html . A provision of the bankruptcy rules requires the court, when a bankruptcy petition has been filed, to notify the Lands Registrar so that what we Australians would call a "caveat" can be placed on any land titles held by the bankrupt. This was not done, with the result that the bankrupt was able to dispose of some land and "dissipate" the funds, which were then unavailable for creditors. Should the trustee, on behalf of the creditors, be able to sue for damages for breach of the duty to notify the registrar?
At first instance
Judge
Hazel Marshall QC in Trustee of Poulton v
Ministry of Justice [2009] EWHC 2123 (Ch) (2 September 2009) http://www.bailii.org/ew/cases/EWHC/Ch/2009/2123.html ruled the relevant regulation did give
rise to a civil action. Factors that supported this view wereo
the
obligation was simple and straightforward
o
the
legislation provided no other remedy if the duty was not complied with
o
creditors
of the bankrupt, who would be affected by a failure to discharge the duty, were
a limited and clearly identifiable class
o
a
previous decision, Ministry of Housing v
Sharp [1970] 2 QB 223, while it had failed on the particular facts, had
accepted that a duty in a similar case (on the Land Registrar to register
encumbrances) was actionable.
On appeal, however, the CA disagreed. I must say with respect that I find the trial judge's decision much more persuasive.
·
One
reason for not finding the duty actionable was that it was not relevant that
there was no other sanction for breach of the rule, because in general “on the part
of relevant court officers and staff, the obligation would be performed as a
matter of course”- [84];
·
But to
my mind that is a good reason for holding that, in cases where there is a
mistake, there should be some remedy for someone who is injured by the failure!
·
It
will be interesting to see whether the matter goes further on appeal to the UK
Supreme Court; in particular note that the CA here seems to cast some doubt on
the authority of Ministry of Housing v
Sharp, calling it “difficult” despite the fact (as they note) that this
decision was reaffirmed recently by the House of Lords (see para [100])
There is also material here of interest for those who argue that one cannot derive a duty of care in negligence from the mere breach of a statute. Both Judge Marshall and the Court of Appeal agreed, and found that there was no duty of care in negligence.
Regards
Neil Foster
Senior Lecturer, LLB Program Convenor,
Newcastle Law School Faculty of Business & Law
MC158, McMullin Building
University of Newcastle Callaghan NSW 2308 AUSTRALIA
ph 02 4921 7430 fax 02 4921 6931