B e f o r e :
THE MASTER OF THE ROLLS (Sir John Donaldson)
LORD JUSTICE SLADE and
LORD JUSTICE LLOYD
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(1) C.W.H. CHILTON
(2) G.M. CHILTON
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(Plaintiffs) Respondents
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v.
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SAGA HOLIDAYS PLC
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(Defendants)Appellants
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(Transcript of the Shorthand Notes of the Association of Official Shorthandwriters Ltd., Room 392, Royal Courts of Justice, and 2 New Square, Lincoln's Inn, London, W.C.2)
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THE (PLAINTIFFS) RESPONDENTS appeared in person.
MR. DAVID FOSKETT (instructed by Messrs. Rootes & Alliott of Folkestone) appeared on behalf of the (Defendants) Appellants.
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HTML VERSION OF JUDGMENT
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THE MASTER OF THE ROLLS: This is a somewhat novel appeal from the decision of His Honour Judge J.T. Turner sitting at Chelmsford County Court. The matter came before him in this way. On the 21st March, Saga Holidays applied to set aside an award made by the Registrar of the Chelmsford County Court in what is known as a small claims arbitration, the basis of the application being that the registrar had refused to allow Saga Holidays, who were the defendants, to cross-examine Mr. Chilton, who was the claimant.
The whole matter arose out of a holiday which Mr. Chilton took under the aegis of Saga Holidays. Mr. and Mrs. Chilton were extremely dissatisfied with the holiday in a number of respects which are immaterial to this appeal. Instead of their pursuing their claim, as they might have done, through the ABTA arbitration procedure, they exercised what is undoubtedly their right, which is to start legal proceedings. Under the County Court Rules 1981 where the claim is for less than £500, which Mr. Chilton's claim was, it is prima facie referred to arbitration before the registrar. There is guidance contained in the rules as to how the arbitration should be conducted. Order 19 rule 5(2) of the 1981 County Court Rules provides as follows (and I can omit paragraphs (1) and (2) which deal with preliminary appointments):
"(3) Any hearing shall be informal and the strict rules of evidence shall not apply. (4) At the hearing the arbitrator may adopt any method of procedure which he may consider to be convenient and to afford a fair and equal opportunity to each party to present his case."
The learned registrar had before him Mr. Chilton in person and Saga Holidays, which is a limited company, represented by a solicitor. He said, in response to a request that Saga be allowed to cross-examine Mr. Chilton and later Mrs. Chilton, "In cases where one side is unrepresented, I do not allow cross examination. All questions to the other side will be put through me." That ruling had, of course, to be accepted by Mr. Radcliffe, the solicitor who appeared for Saga Holidays. He very properly reserved his position, and no criticism is or can be made of his conduct. Saga Holidays, as they were undoubtedly entitled to do, applied to the learned judge to set the award aside on the grounds that the conduct of the arbitration by the registrar in refusing to allow cross-examination was contrary to the rules of natural justice and unauthorised by the County Court Rules.
The learned judge considered this matter, and said this:
"There is no express right to cross examine. The learned Registrar took the view in this case that it was unfair advantage to the Defendants Saga Holidays if, their being represented, they could cross examine the witnesses, whereas Mr. and Mrs. Chilton could only approach cross examination from a laymans point of view.
I am by no means surprised that the learned Registrar did take the view that he did. The terms of reference in relation to arbitration are order 19, rule 5 of the County Court Rules 1981. The relevant rules are 3 and 4 and it states that any hearing shall be informal ... In my view there is a clear wide discretion to adopt any method of procedure - viva voce or one sided - clearly a method of procedure - and afford a fair and equal opportunity to each party to present his case -where there is an imbalance - both parties are laymen - in this case one side is represented the other side was not. In my view this is clearly a case where it was perfectly proper to say no to cross examination."
Later on he said:
"What happened here is well within the discretion of a normal arbitrator and if a party wishes to have a full dress hearing - that party must take the necessary steps after referral on a normal course to arbitration, to make application to refer the matter to open court.
It is clear that the whole object of having small claims dealt with by arbitration, the whole object is to save time, trouble and expense. To bring about a speedy conclusion. I am asked to say that the Registrar erred in law in not allowing cross examination.
I do not consider that the learned Registrar was at all wrong in taking the course he did in this particular dispute."
I regret to say that I find myself in total disagreement with the learned county court judge and, of course, with the registrar. It is quite right that the small claims procedure is intended to be informal. It is intended that no one shall be disadvantaged by not being represented by counsel. But that is quite different from saying that the procedure adopted must be such as to deprive anybody of the services of solicitors or counsel if they wish to have them. It would have been open to the rule-making body, subject to any question of vires, to have provided by rules that in small claims arbitrations neither party should be represented by lawyers. I am sure that that would seem attractive to most laymen, but there is a very real problem which has to be faced if anybody is considering making a rule such as that, that it does not exclude the disbarred barrister and the solicitor who has been struck off the Roll. I take that as an extreme example, but it would be an extremely odd situation if it were open to parties to be represented by those who have left the legal profession and not by those who are members of it. To take a less extreme example, there would be no way in which the rules could provide for the degree of experience which would be permissible for someone who is appearing for one of the parties. Such a rule would be quite unworkable.
However, no such rule has been made, and it must follow that Saga were entitled to be represented. It would seem from what the registrar has said that, if Mr. Chilton had been represented, he would have had no objection to cross-examination. What he seems to have overlooked is that both courts and arbitrators in this country operate on an adversarial system of achieving justice. It is a system which can be modified by rules of court; it is a system which can be modified by contract between the parties; but, in the absence of one or the other, it is basically an adversarial system, and it is fundamental to that that each party shall be entitled to tender their own evidence and that the other party shall be entitled to ask questions designed to probe the accuracy or otherwise, or the completeness of otherwise, of the evidence which has been given.
If authority for this proposition is required, it is to be found in Allen v. Allen [1894] Probate 248 in the judgment of Lord Justice Lopes at page 253 where he says:
"It appears to us contrary to all rules of evidence, and opposed to natural justice, that the evidence of one party should be received as evidence against another party, without the latter having an opportunity of testing its truthfulness by cross-examination."
That has been applied to arbitrations, subject always to the right of the parties to agree otherwise, as has been made clear by the Twentieth Edition of Russell on Arbitration at page 215 where in a quotation from Drew v. Drew in the judgment of Lord Cranworth L.C. it is said:
"The principles of universal justice require that the person who is to be prejudiced by the evidence ought to be present to hear it taken, to suggest cross-examination or himself to cross-examine, and to be able to find evidence, if he can, that shall meet and answer it; in short, to deal with it as in the ordinary course of legal proceedings."
Mr. Chilton has argued his case in this appeal with great moderation, great enthusiasm and great skill. What he says is that where there is unequal expertise available to the two sides, the party with the greater expertise must be disadvantaged to the point at which they have the same expertise effectively as the other party. That seems to me to be a perversion of what the rule requires, which is "a fair and equal opportunity to each party to present his case".
The problem which arises where you have one represented party and one unrepresented party is very well known to all judges and in particular to judges who deal with small claims in the county court. It becomes the duty of the judge so far as he can, without entering the arena to a point where he is no longer able to act judicially, to make good any deficiencies in the advantages available to the unrepresented party. We have all done it; we all know that it can be done and that it can be done effectively. That is the proper course to be adopted. The informality which is stressed by the rule and the requirement that the arbitrator may adopt any method of procedure which he considers to be convenient -it would have been better perhaps if it had said "just and convenient" - covers the situation where, as so often happens, a litigant in person is quite incapable of cross-examining but is perfectly capable in the time available for cross-examination of putting his own case. The judge or the registrar than picks up the unrepresented party's complaints and puts them to the other side.
There was a paper included in the appeal documents setting out the practice in other courts. I do not rely upon it at all. I accept that different courts have different procedures. But Mr. Chilton rightly drew attention to one paragraph where it was said by the registrars of the courts concerned that the unrepresented party had the "dubious" advantage of being represented by the registrar. I do not think the author of that document meant the word "dubious" to be taken literally. In fact, it is a very real advantage. One of the things that judges have to watch when they are faced with an unrepresented litigant is that they do not become so solicitous for his welfare that they think of all sorts of points to which, on reflection, they would have given very short shrift but, because they thought of them themselves, they develop a curious life and appeal of their own so, if anything, the advantages lie with the unrepresented party.
I think that the learned registrar and the learned county court judge were plainly wrong in this case in refusing to allow Saga to ask questions of Mr. Chilton, and I would therefore set the award aside.
I would like to add one further word. Informality is all important in these small claims cases provided that the rules of natural justice are observed; and while I have not actually invited Mr. Foskett to defend his application for further and better particulars in this case, they are virtually indefensible. It was an attempt to turn this arbitration into a High Court hearing with detailed requests for information of which there was not the slightest need since they were already set out in a document prepared by the claimant. That is the sort of formality which should be disapproved of without qualification; but cross-examination is quite different. I would set the award aside and reluctantly, because additional costs may be involved, would direct that it be re-heard by a different registrar. The court concerned no doubt can be agreed between the parties. If not, we can make suggestions. Alternatively, it would be open to a county court judge of that court, on application, to say that it should not be dealt with by arbitration at all; it should be dealt with by litigation. I am not suggesting that that would be a wise course, but it would be a course which would be open to the parties.
One final word, since Mr. Chilton raised the point. He asked whether, if it went back, he would be entitled to call different and additional evidence. The answer to that is Yes; the matter will start entirely afresh. I would allow the appeal accordingly.
LORD JUSTICE SLADE: I agree. I can very well understand why the Registrar considered that Saga Holidays would have an unfair advantage if their solicitor were allowed the right of cross-examination. But in my opinion, for the reasons given by my Lord the Master of the Rolls, in denying Saga Holidays this right, the Registrar erred in principle and the learned county court judge, with all respect to them both, likewise erred in principle in upholding the Registrar's order.
I too would allow this appeal and would concur in the form of order suggested by my Lord.
LORD JUSTICE LLOYD: I agree with both judgments and have nothing to add.
(Order: Appeal allowed. No order as to costs. Retrial to take place at Westminster County Court).
