John Wardell QC Joseph Sullivan

Andrew Mold Tom Nixon

(Instructed by Tanners (Instructed by Gowling

Solicitors LLP WLG (UK) LLP
(Cirencester)) (Birmingham))
LORD KERR: (with whom Lord Hodge, Lord Lloyd-Jones and Lord Kitchin agree)
Introduction
1. Balber Kaur Takhar, the appellant, is the cousin of the third respondent, Parkash Kaur Krishan. For many years before 2004, they had not seen each other. In that year they became reacquainted. At the time, Mrs Takhar was suffering personal and financial problems. She had separated from her husband some five years previously. As part of the arrangements made between Mrs Takhar and her husband, she had acquired a number of properties in Coventry.
2. When Mrs Takhar and Mrs Krishan met again, according to Mrs Takhar, she

confided in her cousin and grew increasingly to depend upon her. Mrs Takhar claims
that Mrs Krishan exerted considerable influence over her.

3. The financial problems of Mrs Takhar arose mainly from the condition of the properties which she had acquired from her husband. Some were in a dilapidated condition. Payment for rates were in arrears. Bankruptcy for Mrs Takhar was in prospect.
4. The Krishans provided financial help to Mrs Takhar. Dr Krishan, the second respondent and the third respondent’s husband, took on responsibility for
negotiating with Coventry City Council over the rates arrears and the dilapidated state of some of the buildings. Then, in November 2005 it was agreed that the legal title to the properties would be transferred to Gracefield Developments Ltd, a newly formed company, of which Mrs Takhar and the Krishans were to be the shareholders and directors.
5. Mrs Takhar claims that it had been agreed between her and the Krishans that the properties would be renovated and then let. The rent would be used to defray the cost of the renovation, which, in the short term, would be met by the Krishans. Mrs Takhar would remain the beneficial owner of the properties.
6. The Krishans present a very different account. They claim that Gracefield was set up as a joint venture company. The properties were to be sold after they had been renovated. They were to be given an agreed value and this would be paid to Mrs Takhar after they had been sold. Any profit over would be divided equally between Mrs Takhar and the Krishans. They explain that Mrs Takhar agreed to these arrangements because planning permission for development had to be obtained in order to realise the value of the properties and this was an area in which Dr Krishan had experience, having already successfully developed his own medical centre.
The proceedings
7. On 24 October 2008, Mrs Takhar, issued proceedings in the Birmingham District Registry…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Takhar v Gracefield Developments Ltd

Details

AGLC: Takhar v Gracefield Developments Ltd [2019] UKSC 13
Case: [2019] UKSC 13
Decision Date

CaseChat Overview and Summary

Balber Kaur Takhar, the appellant, appealed against the decision of the Court of Appeal to dismiss her claim that the judgment of the Chancery Division be set aside on the basis that it was obtained by fraud. The respondents to the appeal, Gracefield Developments Ltd and the Krishans, opposed the appeal. The case before the Supreme Court was concerned with the circumstances in which a party who has obtained judgment against another party may be permitted to set aside that judgment on the basis that it was obtained by fraud. The Supreme Court held that the Court of Appeal's requirement that the party who seeks to set aside a judgment on the basis that it was obtained by fraud must show that the fraud could not have been uncovered by the exercise of reasonable diligence before the original trial was incorrect. The Supreme Court held that, where no allegation of fraud had been raised at the trial which led to the judgment, a requirement of reasonable diligence should not be imposed on the party seeking to set aside the judgment. The Court held that the principle that fraud unravels all is deeply rooted in the common law, and its continued application is an important contributor to honesty within society, to the rule of law and to the ability of the courts to adjudicate disputes justly. The Court held that the absence of reasonable diligence is not of itself a reason for staying the claim to set aside the judgment. The Supreme Court allowed the appeal and restored the order of the Chancery Division.

Orders