B2/2005/1194 
Neutral Citation Number: [2005] EWCA Civ 1446
IN THE SUPREME COURT OF JUDICATURE 
IN THE COURT OF APPEAL (CIVIL DIVISION) 
ON APPEAL FROM BRISTOL COUNTY COURT 
(MR RECORDER LINDBLOM QC)
Royal Courts of Justice 
Strand 
London, WC2A 2LL 

Wednesday, 2 November 2005
 
B E F O R E:

LORD JUSTICE GAGE 

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ANTHONY VALENTINE CARTY
RAQUEL MERCEDES WHITE 
GRAEME JOHNSON 
Claimants/Respondents 
-v-
 
PETER DAN CARROLL
PAUL HAWKINS  
Defendants/Appellants 
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(Computer-Aided Transcript of the Stenograph Notes of
Smith Bernal Wordwave Limited
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Official Shorthand Writers to the Court.
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MR PEARCE-SMITH (instructed by Carroll & Co, Chepstow) appeared on behalf of the Appellants
The Respondents did not attend and were not represented 
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J U D G M E N T 

1.	LORD JUSTICE GAGE:  This is a renewed application for permission to appeal a judgment of Mr Recorder Lindblom QC sitting at the Bristol County Court.  By his judgment and order the Recorder granted a declaration in favour of the claimants that the defendants withheld their consent to the assignment of a licence to use a swimming pool at Itton Court unreasonably.  I shall refer to the parties throughout by the names of the main participants, namely Miss White and Dr Hawkins.  The background is as follows.
2.	The defendants, of whom Dr Hawkins was one, are the legal owners and trustees of a swimming pool in grounds of a substantial listed building, Itton Court, near Chepstow.  The owners of various parts of that building and other buildings nearby are entitled to use the swimming pool by contractual licence.  The benefit of the licence can be assigned to successor owners of the buildings with the consent of the trustees, that consent not to be unreasonably refused.
3.	The claimants, of whom Miss White was one, as purchasers of a nearby property, became entitled to seek an assignment of their predecessor in title's contractual licence to use the pool.  They did seek an assignment and, on 9 September 2003, the trustees refused to grant their consent to the assignment.  The issue at trial was whether that refusal was unreasonable.
4.	The matters relied upon by the respondents were a number of incidents which they alleged had occurred concerning Miss White and which showed that she, in the terms of a letter written to insurance brokers, suffered from uncontrollable and unacceptable impulse which must make her a danger to pool users and their children.  In order to substantiate that allegation they sought to prove a number of incidents.  The judge dealt with all of them and dismissed each one as in any way amounting to conduct which entitled the trustees to refuse consent.  
5.	Before this court the trustees seek to appeal the judgment but only to challenge the facts found by the judgment in so far as they relate to what are said to be the two most serious incidents.  However, there are two incidents which it is submitted would have entitled the trustees reasonably to refuse their consent.  Those two accidents have been referred to as the "car driving incident" and the "pony and dog incident".  I shall deal with each of those separately.  
6.	It is not disputed that the judge in his judgment recited the law correctly, and accurately directed himself in accordance with the law.  The dispute is principally, therefore, a factual dispute.
7.	So far as the driving incident is concerned, put shortly, the applicant, Dr Hawkins, alleged that on an occasion when driving in Chepstow Miss White had deliberately driven up a one-way street.  The evidence of that incident was given by a friend of Dr Hawkins, the owner of a shop in Chepstow.  Evidence was also given on that matter by Miss White.  The Recorder dealt with it at page 44 of the judgment.  He said this: 
"Mrs Skov-Newton said that as the second claimant, having reversed from the laundry, drew her car forward so as to drive uphill, she waved at her, warning her to stop; and that the second claimant saw her doing this.  She said she believed the second claimant's actions were 'quite deliberate'.  She said that she believed the second claimant must have been aware of the one way regulation.  In effect, Miss Skov-Newton alleged that the second claimant wilfully flouted the one way regulation.  
The second claimant's account of this incident was rather different.  She said that she inadvertently transgressed the one way regulation, having taken a right turn from the car park leading from the supermarket and travelling up the hill towards Mounton Road, and was told by a passing pedestrian that the manoeuvre she had carried out was an illegal one.  The second claimant said this was a genuine mistake on her part.  She said the traffic sign had been damaged and was not easy to notice.  
For the four defendants it was submitted that this was a deliberate and dangerous motoring manoeuvre, which the second claimant undertook because, selfishly, she wanted to save time.  I do not accept that submission.  I prefer the evidence of the second claimant to that of Mrs Skov-Newton.  Again, however, even if I had been led to conclude, on the evidence I have heard, that the second claimant wilfully drove as badly as was alleged on this occasion, in the absence of any evidence that she regularly behaved in this fashion I would not have regarded this single incident as a reasonable basis for the belief, or suspicion, that the second claimant - or the first - would be likely to act irresponsibly when using the swimming pool.  Such a view, in my opinion, was not one that was reasonably open to the defendants as trustees."  
Mr Pearce-Smith, who appears on behalf of the applicants, does not now challenge the findings of the Recorder in respect of this incident.  It follows that he accepts that the matter has to be considered upon the basis that Miss White had not deliberately driven down a one-way street.  
8.	Mr Pearce-Smith submits that the importance of this incident was that the trustees, of whom Dr Hawkins was one, were entitled and indeed required to declare this incident to their insurers on the basis of what they had been told by the witness, Mrs Skov-Newton.  I have been told that at no time did the trustees ask Miss White for her version of the events. 
9.	I turn next to the pony/dog incident.  Dr Hawkins alleged that Miss White deliberately and maliciously threw a ball for her dog to retrieve towards Dr Hawkins and his daughter when the latter was riding her pony.  This was a separate incident which followed on after some incident not relied upon which had taken place on the same day at the swimming pool.  As to that matter, the Recorder said: 
"The second defendant [that is Dr Hawkins] said that before he was able to reach the pony, the second claimant [Miss White] pick up a ball and threw it towards him and his daughter and then turned [and] walked away.  He said the second claimant's dog chased the ball, caught it just in front of the pony and then went back to the second claimant." 
The judge continued at the next but one paragraph as follows: 
"The second claimant firmly denied any wrong-doing on her part.  She denied having acted maliciously or recklessly.  She said that she would not have wanted to put her dog at risk, let alone act in such a way as to pose a threat to a horse or its rider. 
Having heard the evidence of both the second claimant and the second defendant about this incident, I accept her account of it.  I accept that she did not act in a deliberate or malicious way.  I accept that she did not intend to cause any injury to the second defendant's daughter, or to the pony.  It is my impression that the second defendant was upset by what had taken place at the pool earlier in the afternoon and that, as a result of this, he was inclined to believe - mistakenly in my view - that the second claimant was motivated by a desire to cause injury to his child.  I do not believe that the second claimant wanted to do that.  I do not believe that she acted out of spite or malice towards the second defendant or his daughter, however discourteous she may have been when she and the second defendant met at the pool."  
10.	The criticism made of the Recorder in respect of this incident is that he failed to deal with the question of whether or not Miss White acted recklessly on this occasion.  It is accepted that the applicant cannot go behind the finding that she did not act maliciously, but it is submitted that, on any view, she must have acted recklessly.  Further, it is submitted that that also was a matter which the trustees were bound to draw to the attention of their insurers when seeking to renew the insurance in respect of the swimming pool.  The fact that it was likely to affect adversely the insurance was a good reason for the trustees refusing consent to the licence being assigned to Miss White and her partner, Mr Carty.
11.	In the skeleton argument, Mr Pearce-Smith drew the court's attention to the case of The Elena G [2001] 1 Lloyds Rep 378, where the principles upon which an assured must disclose information to the insurer are set out.  It is unnecessary for me in this judgment to refer to those matters.
12.	In so far as the Recorder's findings of fact are criticised, there can, in my judgment, be no conceivable prospect of this court rejecting his findings.  They are findings which he was quite entitled to make and on his assessment of the witnesses and the evidence which he heard.  In so far as it is argued that the Recorder was wrong to conclude on the basis of these incidents the trustees acted unreasonably in refusing consent to assign, again in my judgment there is no prospect successfully of overturning the Recorder's findings.
13.	The refusal of consent was based on the trustees' allegations that Miss White had acted deliberately and maliciously in respect of the pony and dog incident and deliberately in respect of her driving.  The Recorder rejected these allegations.  Having done so, he was quite entitled, in my judgment, to hold that consent had been unreasonably withheld.  He said by way of general comment after his findings in respect of the pony/dog incident at page 46 of the judgment: 
"In so far as this incident bore on the decision of the defendants to deny the first and second claimant's permission to use the swimming pool - and it does seem to me that this was the principal reason for the withholding of consent to the assignment of the licence - it is my conclusion that the defendants took an unreasonably negative view of the second claimant's actions.  It seems to me that had the defendants reflected sensibly on what had happened on the occasion I have described, they would have appreciated how extremely unlikely it would have been for the second claimant to have wanted to cause serious injury, or worse, to an 11 year old child.  Indeed, it seems to me that this notion is itself symptomatic of the defendant's unreasonableness in the decision they took.  In other words, the very idea that the second claimant could be so grossly irresponsible in her attitude to the child's safety was one that no reasonable trustee could have entertained in the circumstances as they were when the incident occurred, no matter how poor relations had become between the parties by this stage."  
In my judgment, that is a conclusion that the Recorder was entitled to reach.
14.	So far as the insurance is concerned, having seen the contemporaneous correspondence between the trustees and their brokers, it seems to me hardly surprising that the trustees had difficulty in obtaining insurance.  The brokers were given the trustees' views on Miss White's behaviour.  The terms used in the letter show that the brokers were given little alternative but to give adverse advice in respect of the likelihood of obtaining insurance.  But, as Mance LJ said when refusing permission: 
"... the defendants' basis for thinking that there was a serious risk of any insurance being affected or of insurers attaching any significance to the matters which it is said would have had to be disclosed is to say the least tenuous - no evidence was called from any insurer or broker nor, so far as I can see ... was there any evidence, even second-hand, of any discussion with or information from any broker on this subject: compare the second defendant's evidence at the end of his [cross-examination] at bundle 89-90."  
He had previously said in a comment, with which I agree: 
"That appears to me a hopeless, not to say highly unmeritorious, argument.  First, I do not see how a defendant can, to show a reasonable refusal of consent to an assignment, rely on his own unreasonable belief as creating either an obligation to disclose inaccurate matters to insurers or a fear that insurers might as a result decline cover.  Second, if the belief about the second claimants' conduct at the time of the meeting in the road was, as the judge found, unreasonable, then it seems improbably as a matter of insurance law or practice that the defendants' obligation was to disclose to insurers incorrect facts (based on that unreasonable belief)..." 
15.	Subsequently the trustees have been in correspondence with their insurers.  The correspondence is all post the judgment and therefore not of itself a reason for overturning the judgment.  But, more particularly, it seems to me that the brokers, the same as who had been approached in the first place, must inevitably have had their view coloured by what they had been originally told.  
16.	In my judgment, there is no real prospect of success in this appeal and accordingly I refuse permission.  

(Application refused; no order for costs).