Back in the bad old days

The Government is presently trying to get to grips with cowboy builders. Like many of these initiatives, its enthusiasm appears to have started rather weakly and is gradually deteriorating. One of the primary problems is the inability of the ordinary householder to obtain any meaningful redress in the courts.

Happily the new Civil Procedure Rules of the High Court and County Courts will help to modernise civil litigation and hopefully create a fairer, cheaper and more efficient dispute resolution process. Anyone in any doubt as to the need for this change should read the judgment of the Court of Appeal in the case between Kathleen Megan Saigol and Cranley Mansions and others.

Mrs Saigol owned a flat in Cranley Mansions, Kensington. The long and sorry story of this litigation began with a building contract entered into in January 1988 between Cranley Mansions Limited, which was Mrs Saigol's landlord, Cosmur Construction Limited, as main contractor, and Congreve Horner and Company, as works supervisor. The building works included extensive work on Mrs Saigol's flat and disputes arose almost from the start.

The course of the litigation was complex and for Mrs Saigol at least, traumatic in the extreme. She was originally a defendant in a legal action begun by her landlord in February 1989.

In May 1990, unable to fund the rising costs of defending the litigation, she obtained legal aid. In November of that year, with the litigation only just getting underway, she had a possession order made against her in proceedings brought by her lenders and had to leave her flat. In August of the following year she was adjudicated bankrupt as a result of the litigation.

Mrs Saigol obtained an assignment of the cause of action from her trustee in bankruptcy, allowing her to continue to receive legal aid to defend and prosecute the action. Little did she know at that point that it would take a further eight years of litigation to obtain judgments in her favour, and that these judgments would in any event be too little, too late.

In January 1993 the proceedings, including the counterclaim by Mrs Saigol, were restructured and consolidated by the court. Mrs Saigol became the Plaintiff. The trial of this new action did not take place until the autumn of 1997 and lasted for a period of 42 days. To make matters worse, judgment was not handed down for a further 12 months. When eventually the judgment appeared in November1998, referred to as Judgment no.1, it ran to more than 650 pages.

Essentially Mrs Saigol had won the litigation against the landlord, the builders and the supervisors. In January of this year there was a further hearing to deal with costs, interest, and other related matters. It became apparent that judgment would be entered for Mrs Saigol for a sum in excess of £90,000 against the main contractor, and no less than £739,000 against the works supervisor. No doubt Mrs Saigol was delighted with this finding, but her melancholy was not yet over.

The effect of the Civil Legal Aid Regulations, it was now drawn to her attention, would be that the entirety of the damages recovered by her, substantial though they were, would now require to be paid by her solicitors to the Legal Aid Board. Mrs Saigol's costs of over 10 years of litigation had amounted to more than £1 million.

Mrs Saigol's solicitors wrote to the Legal Aid Board for dispensation, that a part of the funds would be placed in trust so as to provide a home for Mrs Saigol who had been deprived of her home in traumatic circumstances years before.

Armed with this information and further questions surrounding whether the defendant's insurers would pay the damages in full, the Judge had initially ordered a stay of execution of his judgment. In other words, no monies would pass hands until these matters were resolved. Moreover, there remained the possibility of a successful appeal upon the substantive judgment.

The 1993 Court of Appeal case of Winchester Cigarette Machinery Limited -v- Payne was quoted in an attempt to lift the stay. Here the Judge had said; "there must be a good reason to deprive a successful Plaintiff of the right to enforce his judgment, and the mere existence of an arguable ground of appeal is not by itself such a reason."

Finally the judge relented and ordered judgment against the defendants, but even this was not the end of the process. The parties ended up in the Court of Appeal to obtain a ruling as to whether the judge was right in lifting the stay and entering judgment.

Lord Justice Robert Walker said that the matter must now be looked at in a practical way and the legal skirmishing brought to an end. The judgment sum was ordered to be paid within 14 days, a conclusion which regrettably will still leave Mrs Saigol fighting for the scraps on the table. The overriding objectives of Lord Woolf's reforms in civil legal procedure is to "deal with cases justly." It remains to be seen whether Mrs Saigol's story will become a thing of the past.