Jonesco v Beard

Lorp Buckmaster. My Lords, the
appellant in this appeal was the defendant in an action
brought against him by the respondent claiming (a) a share
in eight named race-horses either as a joint owner with the

plaintiff to the extent of one quarter or as a partner; (b) a
3 X 2

1930

oe
JONESCO
v.
BEARD.

300 HOUSE OF LORDS [1930]

H. L. (E.) sum of 2401., the price of two horses known as Why Worry
1930 and Zette, alleged to have been sold and delivered by him to
Jonzsco the appellant in October, 1927.

a The questions at issue were purely questions of fact,.and
Lord the learned judge who tried the action having expressed his
Buemeet disbelief in the respondent's story, dismissed the action with
costs. Judgment to that effect dated July 12, 1928, was

duly drawn up, passed and entered.

On August 23, 1928, the respondent served a notice of
appeal asking (a) for a new trial, but without specifying any
grounds or alternatively (b) that judgment be entered for him
in the action. The Court of Appeal have ordered a new trial,
and from their judgment this appeal has been brought.

On the hearing before the Court of Appeal affidavit evidence
was filed in support of the appeal and answered. It is on
these affidavits that the new trial was ordered. In part
they consisted of statements as to evidence not forthcoming
at the trial and in part of allegations of fraud. The former
did not form the foundation of the judgment of the Court of
Appeal, and indeed they could not have done so, for there
was no sufficient explanation of why the evidence had not
been available at the trial and why no application for
adjournment had been made. These statements do not
merit examination and may be disregarded. It is the charge
of fraud that is the sole reason supporting the judgment
now under appeal. Viewed simply as a matter of procedure
the course taken was irregular. It has long been the
settled practice of the Court that the proper method of
impeaching a completed judgment on the ground of fraud is
by action in which, as in any other action based on fraud,
the particulars of the fraud must be exactly given and the
allegation established by the strict proof such a charge

~ requires. In Flower v. Lloyd(1) the Court of Appeal,

consisting of Jessel M.R., James and Baggallay L.JJ., held

there was not jurisdiction in the Court of Appeal to entertain

a similar application, with regard to one of their own judg-

ments. James L.J. states that 'you cannot go to your
(1) (1877) 6 Ch. D. 297, 302.

A. C.- AND PRIVY COUNCIL.

301

adversary and say, ' You obtained the yedemone by fraud H. L. (E.)

and I will have a rehearing, of the whole case' until that/'
fraud is established."' Flower v. Lloyd (1), Cole v. Langford (2)
and Baker v. Wadsworth (3) show that the right procedure
for that purpose is by action. That, however, there is juris-
diction in special cases to set aside a judgment for fraud on

a motion for a new trial may be accepted. Hip Foong Hong v. |

H. Neotia & Co. (4) is such a case; but it should be remem-

bered that this case had come up to the Privy Council on this .

procedure and the Board would naturally be unwilling to
defeat a case at its last stage on such a ground.

If, however, for any special reason departure from the |

established practice is permitted, the necessity for stating
the particulars of the fraud and the burden of proof are no
whit abated and all the strict rules of evidence apply. The
affidavits used must, therefore, be examined as on final trial ;
every particle of hearsay evidence and reference to documents,
not produced, must be excluded, and it must be kept constantly
in mind that the rules which permit, on interlocutory
proceedings, hearsay evidence, where the exact source of the
information is afforded, have no more application than they
would possess were the deponent a witness in the box speaking
at the trial.

I cannot help thinking that it is because these considera-
tions were not properly placed before and impressed upon the
Court of Appeal that they have pronounced a judgment which,
in spite of the skill of counsel for the respondent, I can find
no ground to support.

To explain the reasons for my opinion some examination
of the facts is necessary. The fraud charged related to the
claim for the price of the two horses alleged to have been
sold to the appellant. Were such fraud properly established
I agree with the Court of Appeal in holding that the whole
judgment would thereby have been vitiated. Fraud is an
insidious disease, and if clearly proved to have been used so that
it might deceive the Court, it spreads to and infects the whole

(1) (1879) 10 Ch. D. 327, 333. (3) (1898) 67 L. J. (Q. B.) 301.
(2) [1898] 2 Q. B. 36. (4) [1918] A. C. 888.

een

Joxissco

peer

Lord
Buckmaster.

302 HOUSE OF LORDS [1980}

H. L. (E.) body of the judgment. Assuming then that the difficulty of
1930 procedure is overcome, was such fraud specified and proved
Jonzsco here ?

Hee. The transaction of the sale of the two horses took place in
asa Brussels in September, 1927. The two horses were bought
Bueamest*t- on successive days. The first, named Zette, was bought at a
selling race on September 5, and the second, Why Worry
from a Mr. Verheyleweghen on September 6. The respondent's
case was that both these horses were bought by him out of a
sum of 2401., which he gave to the appellant in English notes,
receiving in exchange from him the necessary purchase price

in francs.

It is the truth of that story that was investigated by
Maugham J. and it need not be again examined.

In connection with the transaction, however, four important
documents wese produced at the trial referred to by the
Master of the Rolls as 9, 10, 11 and 12.

No. 9 is a document incorrectly printed under date
February 5, 1927; it obviously should be September 5, 1927.

~ It purports to be a provisional receipt given from the
Central Office (presumably of the Belgian Jockey Club) for
16,190 francs received from the appellant for the filly Zette.
It is signed L. Monnaye.

No. 10 purports to be the official receipt for the sale of the
filly Zette for 16,240 francs received from the appellant. It
is dated September 5, 1927, given at the Central Office of the
Jockey Club and signed for them A. Haublatz. The difference
in amount between the two sums is probably due to fees.

No. 11 is an invoice for 60 francs purporting to be given to
the appellant by one Guillaume de Clerck dated September 6,
1927, for moneys due for veterinary services to the two horses.

No. 12 is a receipt for transport of the horses in these words :—

""Regu de Monsieur Jonesco la somme de mille franes pour
voyage Stockel-Anvers Why Worry, Zette.

"" Bruxelles, le 6 Sept., 1927.

"Pour quit

" Aylin

"6 Sept. 1927.

"" AYLIN."

A. C. AND PRIVY COUNCIL.

303

Taking these documents in order there is no evidence H. L. (E.)

impugning 9 and 10. Neither Monnaye nor Haublatz give |

any evidence at all. There is nothing whatever to suggest
that these gentlemen are not what they purport to be and
nothing to show the receipts are not in proper order. The
respondent's statement 'as to these documents taken from his
affidavit sworn on December 5, 1928, is as follows: '' On the
17th July, 1928, after the trial of this action I proceeded to
Belgium for the purpose of discovering the explanation how
the documents produced by the defendant were issued to him.
I proceeded to the Belgian Jockey Club at Brussels and saw
the secretary. On the 22nd day of July, 1928, I met by
appointment the secretary of the Belgian Jockey Club at the
Office Central (who had purported to issue the receipts to the
defendant) for the purpose of inspecting the register recording
the name of the purchaser of the horse ' Zette' sold to me by
public auction. It took some fifteen minutes for this book to
be discovered and in the presence of the secretary of the Belgian
Jockey Club (Leynen) Mr. De Vreer the chief reporter of the
' Sport Elevage ' and myself the clerk who made out document
No. 10 in the bundle of correspondence produced the entry in
the registry for our inspection. The entries in such register
recorded the sale of the horse ' Zette' to me and the defendant's
name did not appear anywhere."

As evidence on the hearing of an action, the whole of this is
inadmissible, but, were it otherwise, it is remarkable that while
the respondent purports to interview the secretary and the
clerk who made out the document, by neither of them even by
this hearsay evidence are the documents themselves repudiated
or their accuracy impugned.

As to document 11, Mr. G. de Clerck says he was asked
by a Mr. Heath (an important witness for the appellant) in
the spring of 1928 for a duplicate in the name of Jonesco
of the receipt he had already given to the plaintiff. He says
the plaintiff was the only person he knew in the matter and the
only person by whom he was paid. Two things are remarkable
on this statement—first, that the document is not a receipt at
all, and, secondly, the deponent nowhere says it is not a true

1930

JONESCO
v.
BEARD.

Lord
Buckmaster.

304

H. L. (E.)
1930

—
JONESCO
v.
BEARD.

Lord
Buckmaster,

HOUSE OF LORDS : [1930]

duplicate, but that it has no value and was given " to confirm
the payment by the plaintiff'—an astonishing method of
confirmation if it was given in the wrong name and was not a
receipt but an invoice.

This leaves only document 12, and this is the one on which
the whole judgment depends, for it is the fraud believed to
have been connected with this that has tainted the whole
proceedings.

The evidence about it is to be found in all that is left o
an affidavit by Montague Victor Aylin and his wife filed on
October 15, 1928. It is as follows: "'Some time during the
spring of this year the said William Heath called upon me and
my wife at Stockel. He stated he wanted a receipt for the
One thousand francs paid me by Jonesco. I asked why he
wanted the receipt as it was five months or more after the
payment and he stated the reason to be that Beard was trying
to get the money from Jonesco twice over."

The original affidavit, from the wreck of which this
paragraph remains, contained a large number of other state-
ments, all of which have been absolutely contradicted by the
same deponents in a later affidavit. As witnesses I should
regard these people as worthless, but supposing the paragraph
quoted stands, and it is not answered, it proves no more than
that a duplicate receipt was required stating in exact and
specific terms what is the undoubted truth. That the
appellant paid the money is proved by the plaintiff himself.
In examination in chief, he says in explanation of how the
appellant accounted for the balance of 240]. said to have been
placed in his hands over and above the price of the horses,
'"There was the transport of the horses from Brussels to
Antwerp that he paid, 1000 francs," and again, also in chief,
he said that, the man in charge of the van for transporting
the horses not knowing the cost of the transport, ''I told
him that if Mr. Aylin, who was his master, sent the bill to
Mr. Jonesco at the Palace Hotel he would pay the bill, and it
was done.' Again, in cross-examination he says in answer to
the question that his evidence in chief had rendered wholly
unnecessary, "Did he (i.e., the appellant) pay for the

A. C. AND PRIVY COUNCIL.

305

transportation ?"' '' He paid the bill."" "'Which bill?" "the H. L. (E.)

bill for 1000 francs,"' and when the receipt, now said to have
been fraudulent, is shown him he says, '"' That is perfectly
right."' After that evidence had been given the receipt which
had become a useless document is put in, and so far as I can
see never referred to again.

Nor was there need for such reference, since it does no more
than furnish evidence of what appears to be the only clear
and undisputed fact in the case. It is not surprising therefore
that the learned judge who tried the case did not even refer
to it in his judgment, and when the Master of the Rolls says
of the learned judge in reference to his statement that the
appellant "paid the cost of the removal of the two horses
to England" he was referring to this document as being
one of the contemporary documents which could be examined
to see how far they recorded the transactions carried out
at the time, and again, " He was then looking at the receipt
of 6th September as one of the documents made in the
ordinary course of duty as between the parties and, therefore,
prima facie entitled to afford evidence of what passed at the
time,' he is assuming what might have been the case had
the payment been challenged, and is overlooking the complete
uselessness of the document having regard to the plaintiff's
own evidence.

To explain how the matter strikes me let me assume A.
owes B. money and pays him. He either takes a receipt
or he does not. If he does, and loses it, is it a fraud for A.
to ask B. to give him a duplicate? If, on the other hand,
he does not take a receipt at the time and asks for one later
on, is that a fraud? I ask myself who is or who can ever
be deceived by the production of a receipt under such
circumstances ?

I cannot help thinking in this case that has happened
against which no vigilance can guard. Owing to some slip
or omission in the conduct of the argument the actual facts
were never before the Court. It is clear their attention
was not called to the irregularity of the procedure, and I
feel certain also that it was not directed to the facts I have

1930
=
JONESCO
v.
BEARD.
Lord

Buckmaster.

306 HOUSE OF LORDS [1930]

H. L. (E.) set out. The judgment cannot stand. The judgment of
1930 Maugham J. must be restored and the respondent must pay

Jonnsco the costs here and in the Court of Appeal.

Beant
—— Viscount Dunepin. My Lords, I concur.

LorD WARRINGTON OF CLYFFE. My Lords, I concur.

Lorp Buckmaster. My Lords, my noble and learned
friends Lord Blanesburgh and Lord Tomlin request me to
say that they agree with the judgment that I have read.

Order of the Court of Appeal reversed and
judgment of Maugham J. restored. The
respondent to pay the costs in the Court of
Appeal and also the costs of the appeal to this
House. Cause remitted back to the Chancery
Division to do therein as shall be just and
consistent with this judgment.

Lords' Journals, Feb. 13, 1930.