[2024] UKUT 69 (LC)

The appeal is effectively an appeal against the FTT’s findings of fact. It is argued by Mr Hart that, contrary to the findings of the FTT, Mr Shah was not the landlord of the property. He also argued, again contrary to the FTT’s findings, that Mr Shah believed the property was occupied by a single household and that he was misled by his letting agent. Finally, it is said that the FTT’s assessment of the quantum of the award failed to take account of the extent to which Mr Shah had been deceived by his letting agent, a deception which the FTT had not been convinced had occurred.

It is relevant therefore to begin with a reminder of the approach which will be taken by any appellate court or tribunal when it is asked to interfere with the findings of fact of a first instance court or tribunal. In cases which depend on the acceptance or rejection of oral evidence (as this case does) the usual outcome of applying that approach was explained by Lloyd LJ in Cook v Thomas [2010] EWCA Civ 227, at [48], when he said: “An appellate court can hardly ever overturn primary findings of fact by a trial Judge who has seen the witnesses giving evidence in a case in which creditability was in issue”.

The proper approach has been long settled. In Clarke v Edinburgh and District Tramways Co Ltd 1919 SC (HL) 35 at 36-37, Lord Shaw said that an appellate court should intervene only if it is satisfied that the trial Judge’s findings of fact were “plainly wrong”. That requirement was restated in the context of the former Rules of the Supreme Court by Stuart-Smith LJ in The Ikarian Reefer [1995] Lloyd’s Rep 455, at 458-9, as follows:

“When questions of the creditability of witnesses who have given oral evidence arise the appellant must establish that the trial Judge was plainly wrong.Once again there is a long line of authority emphasizing the restricted nature of the Court of Appeal’s power to interfere with a Judge’s decision in these circumstances though in describing that power different expressions have been used.  In SS Hontestroom v SSSagaporack [1927] AC 37 at 47 Lord Sumner said:

“Nonetheless not to have seen the witnesses puts appellate Judges in a permanent position of disadvantage as against the trial Judge and unless it can be shown that he has failed to use or has palpably misused his advantage, the higher Court ought not to take the responsibility of reversing conclusions so arrived at merely on the results of their own comparisons and criticisms of witnesses and if their own view of the probabilities of the case.”

This passage was quoted by Clarke LJ in Assicurazioni Generali Spa v The Arab Insurance Group [2003] 1 WLR 577, CA, at [12], when considering the approach to be taken by the Court of Appeal under the current Civil Procedure Rules. In the same case Ward LJ added, at [196]:

“The trial Judge’s view inevitably imposes a restraint upon the appellate court, the weight of which varies from case to case. Two factors lead us to be cautious about interfering. The first, the appellate court recognises that judging the witness is a more complex task than merely judging the transcript. Each may have its intellectual component, but the former can also crucially rely on intuition. That gives the trial Judge advantage over us in assessing a witnesses’ demeanour, so often a vital factor in deciding where the truth lies. Secondly, judging is an art not a science. So the more complex the question, the more likely it is that different Judges will come to different conclusions and the harder it is to determine right from wrong. Borrowing language from other jurisprudents the trial Judge is entitled to “a margin of appreciation”.”

Finally, in Henderson v Foxworth Investments Ltd [2014] UKSC 41, Lord Reed commented on what was meant by a requirement that the first instance decision was “plainly wrong”. At [62] he said that there was a risk that the phrase might be misunderstood:

“The adverb “plainly” does not refer to the degree of confidence felt by the appellate court that it would not have reached the same conclusion as the trial Judge. It does not matter with whatever degree of certainty, that the appellate court considers that it would have reached a different conclusion. What matters is whether the decision of the appeal is one that no reasonable Judge could have reached.”

Although the cases cited have all concerned appeals against the decisions of courts, the same approach applies in tribunals and is adopted by this Tribunal when determining appeals from the FTT when (as will almost always be the case) it has decided not to rehear the evidence for itself.

With that reminder of the difficulty of the task facing any appellant who seeks to reverse a finding of fact on appeal, I can turn to the facts and issues in this appeal.