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	England and Wales Court of Appeal (Civil Division) Decisions
You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Coghlan v Bailey & Anor [2015] EWCA Civ 863 (02 July 2015) URL: http://www.bailii.org/ew/cases/EWCA/Civ/2015/863.html Cite as: [2015] EWCA Civ 863

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IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
(TUGENDHAT J)

		Royal Courts of Justice Strand London, WC2
		2nd July 2015

1. LORD JUSTICE CHRISTOPHER CLARKE: This is a renewed application for permission to appeal from the judgment of Tugendhat J given on 1st April 2014.
2. The claim brought by the appellant, Mr Coghlan, is that Mr Daniel Bailey (the first defendant), who was an officer and investigator of what is now called the Serious Organised Crime Agency (SOCA), made a fraudulent representation to Simon J in the course of civil recovery proceedings brought against him by SOCA which led to a recovery order under the Proceeds of Crime Act 2002 in respect of his family home, Brook Lane Chapel, Alderley, Cheshire, which I will call "the Chapel". The relief claimed in the proceedings issued by Mr Coghlan was the setting aside of the recovery order and a retrial.
3. By his judgment of 1st March 2012 Simon J rejected Mr Coghlan's claim. His judgment is lengthy. It is sufficient for present purposes to draw attention to the essential features of the case. For that purpose I propose to adopt parts of the judgment of Tugendhat J which itself contains a summary derived in part from the judgment of Simon J.
4. On 20th September 2007 a company called Blue Moon Holdings Ltd ("Blue Moon"), substantially owned by a Mr Tomlinson, sold the Chapel to Mr Coghlan for £450,000. Mr Coghlan acquired it with a 100% mortgage from the Halifax Bank of Scotland.
5. In paragraphs 8 to 11 of his judgment Tugendhat J said the following:

"8. As Simon J recorded (para [11]) Mr Coghlan

'has no convictions for drug dealing and none for violence. He has been acquitted of two murders (Little and Barnshaw); and was able to show that a conviction for Assault Occasioning Actual Bodily in 1998, which was relied on by SOCA and for which he was sentenced to 18 months imprisonment, was subsequently quashed by the Court of Appeal. His antecedent record shows convictions for offences of dishonesty for which he has been sent to prison, but he has no convictions since 1997; and although he has been arrested, held on remand and prosecuted for a number of serious offences in addition to those identified above, these were the consequence of the enmity of the GMP and in each case either the charges were not pursued or he was acquitted…'.

9. SOCA's case in summary was that Mr Coghlan was at the head of a large-scale and profitable drug dealing enterprise in Stockport from 1997/98 to 2003/2004 and had no declared income during this period; and, although he was employed from 2004/5 to 2005/2006, he was paid less than £30,000 per annum in those two years. SOCA contended that his drug dealing can be inferred both from his lifestyle and the lack of any alternative source of income.

10. In addition SOCA relied on evidence obtained in the course of the investigation of the murder of a man named David Barnshaw. This evidence fell into three categories: (1) Evidence of recorded conversations between Mr Coghlan and a criminal associate, Graham Mansell, who was imprisoned at HMP Lowdham Grange, during visits in February and March 2001 ('the Lowdham Grange evidence'); (2) A statement made by Kevin Durr ('the Durr evidence'); (3) A statement made by Christopher Gregory ("the Gregory evidence").

11. The Lowdham Grange evidence and the evidence of Durr and Gregory (who were drug dealers and later subject to a witness protection scheme) related to both Mr Coghlan's drug dealing at the relevant time and his interest in the Chapel."

6. Mr Coghlan's case as to the source of the funds was that the Chapel was bought by Mr Kayes and his wife from the then owners in March 2000. This was on the understanding that Mr Coghlan would live there and act as a project manager in developing it as a family house. There was an agreement to pay rent but that was not paid or insisted on from April 2001 to June 2003, when Mr Coghlan was on remand.
7. The sale of the Chapel by Mr Kayes to Blue Moon, which took place on 9th July 2004 was, it was claimed, at the market price, namely £300,000 for the property with a tenant, as was the sale of the property to him by Blue Moon in September 2007 for £450,000. In paragraphs 16 and 17 of his judgment Tugendhat J said:

"16. At paras [21] to [39] Simon J stated:

'21. On 4 February 2000 NatWest Bank valued the Chapel at £290,000; on 24 March 2000 it was sold to Mr Kayes by its owners, … for £180,000. SOCA pointed out three apparent anomalies in relation to this sale. First, although £162,000 of the purchase was raised by a mortgage from the NatWest Bank, it is unclear where the deposit of £18,000 came from. It was paid by banker's draft, but the SOCA evidence was that it did not come from any identifiable account of Mr Kayes and, when asked about this, Mr Kayes had no recollection of it…. [emphasis added]

27. Following the stay of the indictment [relating to the Barnshaw matter] Mr Coghlan returned to the Chapel; and on 1 May 2004 commenced his employment with Blue Moon as a project manager at an annual salary (2004/05) of £24,750. ….

28. On 6 June 2004 an appraisal report was prepared by NatWest. This described the former chapel hall as awaiting refurbishment, but the rest of the Chapel as being in good condition, complete with premium quality fittings such as beech-wood floors and modern kitchen and bathroom fittings. There were also planning applications in relation to security, interior building and renovation work, in which Mr Kayes was the applicant, but where all the face to face dealings involved Mr Coghlan or his agents. Mr Bailey (a SOCA investigator) summarises SOCA's position in §7.25 of his 1st witness statement [dated 17 July 2009].

It has not been possible to identify any expenditure for the renovation work completed at the Chapel despite detailed analysis of the known bank accounts of both Kayes and Coghlan. This leads me to believe that all the works completed were paid for in cash by either Coghlan or his associates on his behalf.

29. On 8 June there was a NatWest valuation of the Chapel at £450,000; and on 9 July 2004 the Chapel was sold by Mr Kayes to Blue Moon for £300,000. When they were later asked why the Chapel was sold for 33% less than the valuation, Mr Kayes said he could not remember; and Mr Tomlinson said it was at least in part because Mr Coghlan was a sitting tenant….

39. On 12 June 2007 the Chapel was valued by Halifax at £900,000 at the current state of the property market; and on 21 September Mr Coghlan purchased the Chapel from Blue Moon for £450,000, with a 100% interest-only mortgage from Halifax.'

17. So in September 2007 Mr Coghlan had acquired for £450,000, and with a 100% mortgage, a property recently valued at £900,000."

Paragraphs 21 and 23 to 25 of Tugendhat J's judgment read as follows:

"21. At para [98] Simon J concluded that he was satisfied from the evidence that, while he was at large between 1999 and at least April 2004, Mr Coghlan was engaged in unlawful conduct as a drug dealer, and that his drug dealing was the source of his income. He summarised his reason in seven sub-paras of para [99], the first of which was the lack of any evidence of either a legitimate, or any, source of income during this period. He also concluded that Mr Coghlan made a calculated admission of a lesser transgression in order to conceal the true source of his cash income, which was drug dealing.

...

23. Simon J then turned to consider how the Chapel had been acquired. He summarised the information given in interviews by Mr Kayes, Mr Tomlinson and Mr Coghlan. He concluded at para [108]:

'I find that from an early stage Mr Coghlan had available cash from his unlawful conduct and was highly sensitive to the risk of recovery under POCA. Although he took careful steps to conceal his interest in the Chapel, I am satisfied that it existed and derived from his income from drug dealing; and the steps he has taken to conceal his interest in the property and to put it beyond the reach of SOCA is further support for the conclusion that his income came from unlawful conduct.'.

24. This conclusion followed from the findings he made in para [107] in 15 sub-paragraphs. In three of these he found that the Chapel had been sold at an undervalue: to Mr Kayes in March 2000 (sub-para (2)), to Blue Moon in July 2004 (sub-para (8)) and again to Mr Coghlan in September 2007 (sub-para (12)). Sub-para (4) is the sub-paragraph which is most significant for this appeal.

25. In sub-paras (2) to (4) he stated:

'(2) The acquisition price of £180,000 which was agreed in March 2000 was significantly lower than the NatWest valuation of £290,000 in February 2000. This is in itself gives rise to questions, and no sufficient explanation has been given. Although it is unnecessary to reach a view about this, I consider that the most likely explanation is that a higher price was in fact agreed, with a side agreement which provided how the difference between such higher price and £180,000 should be paid. If the true price was in the region of £240,000 it would explain the obscure draft document and the references to a missing £60,000, with Mr Coghlan being mentioned in relation to both. However the evidence about this is not sufficient to enable me to be satisfied other than it was a sale at an undervalue; and the correspondence in February 2000 in relation to an outstanding sum of £170,000 throws no further light on the matter.

(3) Even if the true price was £180,000 it is difficult to see the commercial attractions of the property for Mr Kayes without any plans to develop it. The involvement of Mr Coghlan was plainly crucial, and yet was said by Mr Kayes not to have occurred until after he had bought the Chapel. I am satisfied that this was Mr Coghlan's project from before the Chapel was purchased.

(4) The purchase of the Chapel using a mortgage was an unusual transaction for Mr Kayes; and although £162,000 was advanced on the mortgage, Mr Kayes was unable to explain where the £18,000 deposit came from. Its source is still unexplained, but is likely to have come from Mr Coghlan.' (emphasis added)"

8. Before Master Yoxall and Tugendhat J three specific fraudulent misrepresentations were relied on under the following headings:

1. The source of the deposit.

2. The rent paid by Mr Coghlan.

3. The proceeds of sale by Mr Kayes.

We are presently concerned only with the first. I should also point out that these are allegations of fraudulent misrepresentations, they are not matters that have been found by any court. Tugendhat J's judgment continues:

"28. The first alleged fraudulent misrepresentation related to the source of the deposit of the Chapel when it was it was sold to Mr Kayes in 2004 (referred to by Simon J in his paras [21] and [107(4)]. In his first witness statement Mr Bailey stated at para 7.12:

'Analysis of the conveyancing files obtained under the Disclosure Order show that KAYES purchased the Chapel for £180,000 from Simon Harrington and Alexandra Wilkinson. Enquiries with the mortgage provider have shown KAYES to have obtained a mortgage with the NatWest for £162,000 with a 10% deposit of £18,000 being paid by bankers draft from an unknown source. During interview on the 26th November 2008, KAYES was asked how he purchased the property to which he replied that he couldn't remember. When asked whether it was a cash transaction he again stated that he couldn't remember but he thinks their [sic] might have been a mortgage' [emphasis added].

29. Mr Coghlan pleads that the representation that there had been 'a 10% deposit of £18,000 being paid by bankers draft from an unknown source' was false and was made fraudulently, knowingly or recklessly. He pleads that 'the deposit was not in the round sum of £18,000 from 'an unknown source' but was in fact a payment of £18,030 known by [Mr Bailey] to have originated from the Instant Saver account of the purchaser, Kerry Kayes, held at the local branch of the Halifax Building Society'.

30. Mr Coghlan has, since the judgment of Simon J, obtained from Mr Kayes' solicitors, Messrs Chafes, a copy of the draft in question. It is an order dated 8 March 2000 signed on behalf of Halifax plc and addressed to itself. It is an order to pay to Chafes the sum of £18,030. On the face of the document there is a reference number, which is the account number of Mr Kayes' Instant Saver Account. The branch is identified by the words 'Branch's Suspense Account – 025 Denton'.

31. Mr Coghlan pleads that since Mr Bailey stated that he had analysed the conveyancing file from which the draft was produced, and had examined the account of Mr Kayes bearing the number which also appears on the draft, he knew that the funds came from Mr Kayes' account: he made the statement that the funds came from an unknown source, knowing it to be false, or was reckless as to whether it was true or false."

9. It is apparent that the statement by Mr Bailey quoted in paragraph 28 of Tugendhat J's decision that Mr Kayes obtained a mortgage with National Westminster for £162,000 with a 10% deposit of £18,000 being paid by banker's draft from an unknown source was inaccurate. A deposit was paid by banker's draft but on the face of the document there was the reference number of Mr Kayes' account.
10. The Master held that Mr Coghlan had a real prospect of establishing that Mr Bailey's evidence as to the source of the deposit ("paid... from an unknown source") was made at least recklessly. But, so he held, there was no real prospect of establishing that the order of Simon J was obtained by this alleged fraudulent misrepresentation. It was, he held, apparent from the judgment of Simon J and in particular from paragraphs 98 to 100 and 107 to 108 that there were a number of factors involved and the question of deposit was but one issue among many.
11. In so stating, as Tugendhat J held, the Master was.

"...not stating a principle of law, but giving his assessment of the matter on the facts before the judge and himself. He was stating, in his own words, that Mr Coghlan had no real prospect of establishing at any trial that the fraudulent misrepresentation (assuming that that is what it was) was so material that its production at the trial would probably have affected the result. And in my judgment the Master's assessment of the materiality of the misrepresentation alleged was one he was fully entitled to make."

12. Tugendhat J also held that if he had to consider the matter afresh he would reach the same decision. He did so in the following terms:

"51. If I had had to consider the matter afresh, which I do not, I would have arrived at the same result. I observe that it was SOCA's case, which Simon J upheld (para 23 above), that Mr Kayes' purchase of the Chapel was part of the steps Mr Coghlan took to conceal his interest in the property. The true position on the deposit, namely that the £18,030 was paid out of an account in the name of Mr Kayes, was entirely consistent with the case which Simon J upheld. The true facts as to the deposit did not cast a different light on the case at all. And the source of the deposit was not crucial to identifying the Chapel as the proceeds of crime. It was no part of SOCA's case that the Chapel derived from particular crimes. It was not SOCA's case that Mr Coghlan had obtained £18,000 or any other specific sum, and used that specific sum to invest in the Chapel. That was not the way the case was advanced."

13. So far as the law is concerned, the judge accepted that the summary set out in Dicey, Morris and Collins on Conflict of Law (15th edition at para 14-138), with the possible exception of the words underlined below accurately represented the law:

"Any judgment whatever… is, if obtained by fraud, open to attack. A party against whom an English judgment has been obtained may bring an independent action to set aside the judgment on the ground that it was obtained by fraud; but this is subject to very stringent safeguards, which have been found to be necessary because otherwise there would be no end to litigation and no solemnity in judgments. The most important of these safeguards is that the second action will be summarily dismissed unless the claimant can produce evidence newly discovered since the trial, which evidence could not have been produced at the trial with reasonable diligence, and which is so material that its production at the trial would probably have affected the result, and (when the fraud consists of perjury) so strong that it would reasonably be expected to be decisive at the rehearing and if unanswered must have that result…"

In paragraph 46 Tugendhat J said the following:

"46. In an action to set aside a judgment on the ground that it has been obtained by fraud the question is how, if at all, would the conclusions of the trial judge have been affected if the witness alleged to have been fraudulent had given the trial judge the information which the claimant (ie the claimant in the action seeking to set aside the judgment) alleges he concealed? The question is not how would the judge's conclusions have been affected had he known that that witness was not a straightforward and frank witness? See the judgment of Phillips LJ as he then was in Gaillemer Sarland v McClelland (19 February 1996 unreported)."

14. Permission to appeal is sought on four grounds. I take ground 2 first. It is said that the judge was wrong to conclude that the Master was entitled to conclude that the misrepresentation as to the deposit was insufficiently material to have probably affected the result of the trial.
15. Mr Paul Hynes QC, on behalf of the appellant, submits that the significance of Mr Bailey's evidence about the source of the £18,000 being unknown was as follows: his statement revealed that he had analysed the conveyancing file for Mr Kayes' purchase. That file contained a copy of an attendance note referring to "Kerry" obtaining the cheque and dropping it to his solicitors. The file also contained a copy of the £18,030 cheque or draft but neither that nor the attendance note were exhibited. In the end, after the judgment of Simon J, Mr Coghlan obtained a copy of the draft, which had on it the account number of Mr Kayes.
16. Mr Bailey in his statement had made no reference to the £18,030 leaving that account; nor did he refer to the account number on the draft, which matched the number of the savings account of which SOCA had obtained disclosure by virtue of an order of the court. This, Mr Hynes submits, shows that the immediate source of the account was hidden. That he says is of great significance because the omission tainted all that followed. If the position was that in March 2000 the purchase of the Chapel took place with a mortgage and an apparently regular payment of £18,000 the foundation of the claim that in reality this was the property of Mr Coghlan begins to fall away. The inference, Mr Hynes submitted, must be that the suppression of the fact that the £18,000 came from Mr Casey's account was deliberate.
17. Mr Bailey's reference in a latter statement in the present action to ignorance of the provenance of the money was, he submits, a subtle but important change from his original statement that he was unaware of the source. Mr Hynes observes that no explanation has been given as to why Mr Bailey or SOCA decided not to deploy the cheque during the interviews of Mr Kayes and Mr Coghlan, nor as to why the cheque was not revealed during the trial when Mr Coghlan asked for it and why the application for disclosure was strongly resisted. All these considerations, he submits, support the inference of a deliberate policy of manipulation. It is clear, he observes from his judgment that Simon J understood that the SOCA evidence was that the money did not come from any identifiable account of Mr Kayes, not simply that its provenance was unknown as appears from paragraph 21 of the judgment.
18. No step was ever taken to correct that understanding. The impression necessarily left, he submits, was that the court should exclude the purchaser, Mr Kayes, as being the source of the deposit.
19. Mr Hynes further submits that Tugendhat J was wrong to find that the hidden payment of £18,000 by Mr Coghlan, as the judge found it to be was immaterial to or did not advance SOCA's case on concealment. The true position, he submits, was that there was in fact no concealment. There was a payment from Mr Kayes. The result of what happened was that Simon J found that Mr Kayes was not simply a purchaser who could not recollect the detail of the transaction but one who had not paid his own deposit. Having started from that premise, he was less likely to find that Mr Kayes had a true interest of some sort in whole or in part in the property.
20. In addition, he submits that the allegation that the whole of the beneficial interest in the Chapel represented the proceeds of crime assumed that the full beneficial interest had been in Mr Coghlan's hands before he formally acquired it in September 2007 and that Mr Kayes was a mere nominee and that his purchase in 2000 and the subsequent dealing with it were a sham; whereas, if Mr Kayes was not a mere nominee but held a genuine interest, then at least part of the Chapel could not be recovered by SOCA. Mr Bailey's misrepresentation to the source of the deposit could be said to have led Simon J to find that Mr Coghlan had been the source of the deposit, as he did. The true position in respect of the deposit draft was not, as Tugendhat J found, entirely consistent with the case that Simon J upheld. It is at least consistent with a concealment with only a partial interest held by Mr Coghlan together with Mr Kayes, such that the whole of the Chapel was not recoverable property.
21. It seems to me that the Master and the judge were entitled to conclude that there was no realistic prospect of the appellant establishing that the judgment was obtained by the alleged fraud said to be inherent in the statement "a 10% deposit of £18,000 being paid by banker's draft from an unknown source".
22. As the Master observed the judge reached his conclusions on the basis of a multiplicity of factors. He concluded that Mr Coghlan was a drug dealer and that that was the source of his income (paragraph 98). One of the indicia for that was his payment for the redevelopment and refurbishment of the Chapel (paragraph 99(7)). Simon J considered the evidence of Mr Kayes, Mr Tomlinson of Blue Moon and Mr Coghlan. In the light of that evidence he reached some 15 conclusions set out in the numbered subparagraphs of paragraph 107. These included:

(a) the "illuminating" history of negotiations in relation to Blackshaw Farm where, following an inquiry by a firm of solicitors on behalf of Mr Coghlan, an offer had been made by the same firm of solicitors purporting to act on behalf of Mr Kayes when Mr Kayes was ignorant of their existence;

(b) his conclusion that contrary to Mr Kayes' evidence the Chapel was Mr Coghlan's project from before time when the Chapel was purchased;

(c) the fact that the purchase of the Chapel using a mortgage was an unusual transaction for Mr Kayes and that he was unable to explain where the £18,000 deposit came from when first asked.

(d) the fact that the building work was entirely in Mr Coghlan's hands from May 2000 until his arrest in April 2001. (e) his conclusion that all the renovation work was paid by Mr Coghlan or on his behalf in cash which reinforced the judge's view that he regarded the Chapel as his. The tenancy agreement was, the judge held, a sham, intended to divert attention away from Mr Coghlan's real interest in the Chapel and Mr Kayes did not receive any rent.

(f) the finding that Mr Kayes' purchase of the Chapel was carried out in order to provide Mr Coghlan with a house which he could develop using his available cash.

(g) the purchase of the Chapel at £180,000 and its sale into 2004 were at undervalues.

(h) the fallacy of the suggestion that the sale in 2007 had been an undervalue because of Mr Coghlan's position as a sitting tenant and.

(i) the paucity of certain documents.

23. This led to his final conclusion at paragraph 108 that:

"Although he took careful steps to conceal his interest in the Chapel, I am satisfied that it existed and derived from his income from drug dealing..."

24. It seems to me, as it did to Tomlinson LJ, unrealistic to suppose that Simon J would have reached a different conclusion if only he had been told that the £18,030 had come from Mr Kayes' savings account. That would have shown the immediate source of the funds. But it would also beg the question as to where that money came from or, indeed, whether it was a sum owed by Mr Kayes to Mr Coghlan in any event.
25. The conclusion that the Chapel belonged beneficially to Mr Coghlan and was acquired and developed out of Mr Coghlan's profits from drug dealing was derived from a wider set of circumstances than the immediate source of the £18,030. Simon J found that Mr Coghlan's scheme was to purchase the Chapel for himself with his drug money but to take elaborate steps to conceal it. Revelation of the fact that £18,030 had come from Mr Kayes assets as its immediate source would not, in my judgment, have changed the position given what the judge found about the nature of the project from the beginning and the involvement of Mr Kayes in the work of concealment of Mr Coghlan's interest. If knowledge of the immediate source of the £18,030 had been available the only qualification that would in fact have to be made to the judge's holding in relation to deposit that:

"Its source is still unexplained and likely to have come from Mr Coghlan 'would be to substitute 'provenance' for 'source'."

26. Ground 3 is that the judge was wrong to find as a matter of law that the dicta of Pearce LJ in Meek v Fleming [1961] 2 QB 36 did not represent a principle of law. That case was an appeal from a verdict of the jury in a claim for damages for assault and false imprisonment. The dicta relied on are these:

"44. Holroyd Pearce LJ said at p379-80 that

'where a party deliberately misleads the court in a material matter, and that deception has probably tipped the scale in his favour (or even, as I think, may reasonably have done so), it would be wrong to allow him to retain the judgment thus unfairly procured….

… since the defendant and his advisers thought fit to take so serious a step, they must, in the light of their own intimate knowledge of their case, have regarded the concealment as being of overwhelming importance to their success. Therefore I am not prepared to countenance their present argument that it may have made no difference to the result'."

What is said is that the Master's expression that there was an arguable case "at least as to reckless" did not exclude a real prospect of establish a deliberate lie. There was, it is submitted, such a prospect in the light of the series of decisions that Mr Bailey must have taken about not revealing material. This line, it is said, must have been taken because Mr Bailey believed the lie important to SOCA's success. In those circumstances, so the submission goes, the Master should have followed the lead showed in Meek v Fleming.

27. In my judgment Tugendhat J was right to say that the second passage cited was not a principle of law but a statement made in relation to the facts of that case. Of course the more material the untruth the more likely it is that judge will have been influenced by it. If in addition the untruth was a deliberate lie the court will the more strongly be inclined to the view that the judge was materially influenced by it. But at the end of the day whether an untruth made any difference is not determined by how important the liar thought the lie to be. It is noticeable that in Meek the step taken by the defendant and his advisers was regarded as "serious" and such that they regarded the concealment of "overwhelming importance". It does not seem to me there is a realistic prospect of regarding the lie in this case, if such there was, as one of overwhelming importance or that Simon J would have regarded it as such.
28. It is next said, under ground 1, that the judge was wrong, as a matter of law, to find that the only question to be considered in respect of the fraudulent misrepresentation was how, if at all, would the conclusion of the trial judge have been affected if Mr Bailey had given the judge the information that he allegedly concealed. He ought, so it said, also to have considered how the conclusions of the judge might have been affected had Mr Bailey's fraudulent misrepresentation been exposed. If that had been done, it is submitted, the impact would have been significant. Mr Bailey was the only effective witness and it was he who had conducted the investigation. The judge was reliant on SOCA to ensure that the evidence had been presented in a fair way. If that exposure had occurred SOCA's resistance to Mr Coghlan's disclosure would have cast them in a very poor light. It might have caused the judge to review his refusal of an adjournment at the beginning of the trial; called in question the appropriateness of the Part 8 procedure; and dictated a conclusion that there should have been an order for disclosure as sought at the trial by Mr Bailey. The judge would, if the dishonest representation had been revealed, been less likely, it is submitted, to draw the inferences that he did. (I observe that we are not concerned in the present application with the question as to whether or not the procedure of the trial was appropriate or should have been different.)
29. The question that this ground of appeal arises has, in my judgment, already been addressed in the case of Gaillemer Sarland v McClelland (19th February 1996, unreported). In that case Phillips J (as then was) said this:

"There is a fundamental logical fallacy running through the grounds of appeal. They keep posing the question how would the judge's conclusion have been affected had he known that Mr Kutzs was not a straightforward and frank witness? A proper question is how, if at all, would his conclusions have been affected had Mr Kutz given under him the figures which checkpoint allege he concealed?"

30. I will assume, without deciding that the Master could and should have considered the affect of the revelation of dishonesty. Even then, it seems to me unrealistic to suppose that this would have led the judge to a different conclusion. The judge's conclusions were reached by reference to a series of matters derived from objective facts and the evidence and the inferences that he drew from them. His findings were not dependent on the credibility of Mr Bailey, nor indeed would revelation of the inaccuracy of Mr Bailey's evidence in fact be likely to have justified going back to square one procedurally.
31. The fourth and last ground relied on is that it is said that the Master was wrong to conclude that there was no compelling reason for a trial. Mr Hynes submits there was a high public interest in having a trial. The dishonestly alleged was against an officer of a leading law enforcement agency of the United Kingdom. There is, he says, a particular public interest in protecting the integrity of Part 8 proceedings where the civil justice system is dependent upon the truthfulness of the accuser. Those considerations, together with the fact that the application for an order was in fact founded upon evidence generated during the Barshaw Inquiry which was stayed for abuse of process arising out of serious police misconduct, underscores the public interest in trying the issue of dishonesty in this case, which, he says, forms part of a pattern of misconduct.
32. I do not accept that there is any realistic prospect of showing that the Master or the judge should have decided that there was a compelling reason for a trial. If there was no realistic prospect of establishing the order of Simon J had been attained by fraud, it was inappropriate to conduct a trial which would not lead to the order that he made being set aside. There was certainly not a compelling case for doing so. At the very least it was open to the Master to take that view.
33. These considerations are such as to indicate that, in my judgment, this application does not pass the first appeal test. This appeal, if allowed to proceed, would be second appeal. I am wholly unsatisfied that it raises an important point of principle or practice that should form the subject of a second appeal or that there is some compelling reason for such an appeal. Accordingly I would propose that permission to appeal be refused.
34. SIR STANLEY BURNTON: I entirely agree.