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Evidence, Practice and Procedure: Full pleading of a claimant’s case; and detrimental reliance

Date:9 AUG 2013

David Burrows - Practice of Family Law: Evidence and Procedure

David BurrowsSmith v Bottomley and Coach House Properties Ltd [2013] EWCA Civ 953 is an object lesson in penalties for parties for inadequate pleading; and (perhaps) reminds family lawyers of the strict application of rules as to implied trusts - especially in relation to detrimental reliance to establish a constructive trust.

Ms Smith (‘S') had had a lengthy but uncertain personal relationship with Mr Bottomley (‘B'): promises of marriage had failed to produce a ceremony; they had a child (now aged 18); and she worked for him in his militaria business. He also had a small property development company ((the second appellant) incorporated during the course of their relationship) which owned two properties and had conveyed to it a barn. S claimed a constructive half share in the barn (and to two other company properties), and that she was entitled to an additional £21,000 from another property sold by B which she had jointly owned with him. She claimed that he had promised a half share to her and that she had relied on his promise to her detriment.

The judge gave judgement for her in respect of the barn only and the cash. He did not deal specifically with the terms of the detrimental reliance on which he based his findings; and S's counsel only addressed the point in last minute amendment to her respondent's notice on the appeal (paras [32]-[33]). Her claim for cash was not pleaded at all. B appealled against the judge's decisions.

On the cash claim, Sales J (who gave the lead judgement) pointed out that it was only raised in the course of the hearing. Despite two amendments to her particulars of claim, S did not plead the claim. It was not the subject of case management at any stage of the case. S had had a fair opportunity to advance ‘a properly pleaded claim', but had not done so. B had suffered ‘real prejudice' by this failure, in that he could not produce evidence in defence (and see para [72]). His appeal on this issue should be allowed (para [55]). Lloyd LJ returned to the pleading point by expressing regret that, despite opportunities, S had no properly pleaded her case. The ability of the court to proceed in the absence of proper pleading must be adjudged on grounds of fairness to B ([72]).

Of the trust claim: the court pointed out that this was a promise by B and (if proved) by him on behalf of the company (S accepted that this was not a case for piercing the corporate veil per Prest v Petrodel Resources Ltd [2013] UKSC 34; [2013] 3 WLR 1). The only promise made was before incorporation of the company, which anyway carried out a variety of work at the barn. It was not later repeated for the company. If the company did join in the promise, the detrimental reliance on which S sought to rely predated the formation of the company or was not related to the company's ownership of the barn.

The Court of Appeal can be seen here adopting ‘fairness' in applying clear pleading rules; and not any uncertain concept of ‘fairness' on the trust issues. An attempt by S's counsel to rely on Lombard North Central plc v Automobile World (UK) Ltd [2010] EWCA Civ 20 fell on deaf ears: Lloyd LJ pointed out that what Rimer LJ actually said in that case leaves only a very narrow gate for those who come to court with an unpleaded case:

[79] ... I make clear that I am not suggesting that courts must adopt an inflexible approach to the question of whether or not a particular unpleaded issue may or may not be the subject of investigation at a trial. There will be cases in which it will be obvious that it would be unjust for the court not to entertain and decide a non-pleaded issue: for example, when it is apparent that both sides have come to court ready to deal with it as an issue in the case despite its omission from the pleadings.... such cases are likely to be rare.

David Burrows is author of Practice of Family Law: Evidence and Procedure (Jordans, 2012).

The views expressed by contributing authors are not necessarily those of Family Law or Jordan Publishing and should not be considered as legal advice.