Hindcastle Ltd v Barbara Attenborough Associates Ltd

Lord Keith of Kinkel
Lord Griffiths
Lord Browne-Wilkinson
Lord Lloyd of Berwick
Lord Nicholls of Birkenhead

LORD KEITH OF KINKEL

My Lords,

For the reasons given in the speech to be delivered by my noble and learned friend Lord Nicholls of Birkenhead, which I have read in draft and with which I agree, I would dismiss this appeal.

LORD GRIFFITHS

My Lords,

I have had the advantage of reading in draft the speech prepared by my noble and learned friend Lord Nicholls of Birkenhead, for the reasons he gives I would dismiss this appeal.

LORD BROWNE-WILKINSON

My Lords,

For the reasons given in the speech of my noble and learned friend Lord Nicholls of Birkenhead I too would dismiss this appeal.

LORD LLOYD OF BERWICK

My Lords,

I agree that the appeal should be dismissed for the reasons to be given by my noble and learned friend, Lord Nicholls of Birkenhead. I add a short speech of my own only because I have found the case to be one of some difficulty.

At an early stage of me hearing I formed the view that Hill v. East and West India Dock Co, (1884) 9 App. Cas. 448, and Stacey v. Hill [1901] 1 QB 660, could not well stand together, despite Sir Robert Megarry V.-C.'s attempt to reconcile the decisions in Warnford Investments Ltd. v. Duckworth [1979] Ch, 127, and Millett L.J.'s further attempt at reconciliation, on rather different grounds, in the court below. If the decisions cannot be reconciled, the question becomes which of the two decisions should be preferred,

For much of the hearing I was attracted by Mr. Oliver's argument that the reasoning in Stacey v. Hill was the more convincing. The key feature of that decision, as Mr. Simon Goldblatt Q.C. pointed out in his remarkable extempore judgment at first instance, is that both A. L. Smith M.R. and Cotton L.J. regarded the case as being concluded by the passage which the former quoted from the judgment of Lindley L.J. in In Re Finley; Ex parte Clothworkers' Co. (1888) 21 Q.B.D. 475, 485:

"Now the operation of those clauses in the simple case of a lease is not very difficult to ascertain. If there is nothing more than a lease, and the lessee becomes bankrupt, the disclaimer determines his interest in the lease under subsection 2. He gets rid of all his liabilities, and he loses all his rights by virtue of the disclaimer. There is no need of any provision for vesting the property in the landlord, but the natural and legal effect of subsection 2 is that me reversion will become accelerated."

A. L. Smith M.R. put the point as follows in Stacey v. Hill [1901] 1 QB 660, 664:

"In other words, the effect of the subsection is that in such a…