Home Information Cases Barclays Bank PLC v Coleman & Anor (1999)

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Barclays Bank PLC v Coleman & Anor (1999)


A new trial was refused to a defendant who had been refused an adjournment and had had to conduct his case in person. Where a wife sought to set aside a mortgage on the grounds of undue influence, the issues were: (i) the meaning of "manifest disadvantage"; and (ii) whether the lender was fixed with constructive notice of the wife's right if it relied on a certificate of independent legal advice given by a legal executive rather than a solicitor. * Appeal to the House of Lords dismissed in Royal Bank of Scotland v Etridge (No.2) & conjoined appeals (2001) 3 WLR 1021.


Appeals by a husband and wife arising out of a mortgage of their jointly owned matrimonial home created in order to secure the husband's indebtedness to the mortgagee. The mortgagee claimed payment against the husband and possession against both husband and wife. The husband counterclaimed for rescission of the mortgage on the ground of misrepresentation by the mortgagee and damages for misrepresentation and negligence. The wife's defence was that her execution of the mortgage had been procured by the husband's presumed undue influence over her of which the mortgagee had notice (cf Barclays Bank v O'Brien (1993) 3 WLR 786). She counterclaimed to have the mortgage set aside on that ground. HH Judge Wakefield gave judgment for the mortgagee in the Central London County Court against both husband and wife for the relief claimed against them respectively and dismissed their counterclaims. The husband appealed against the judge's refusal to grant him an adjournment at the start of the trial, the consequence of which was that he had to conduct his case in person. Legal aid had been withdrawn the previous week. He sought a new trial. If his appeal failed, he did not impugn the correctness of the judge's decision on the merits of his substantive case. The wife appealed against the judge's decision that the transaction was not "manifestly disadvantageous" to her. By a respondent's notice, the mortgagee claimed, contrary to the judge's view, that in relying on a certificate of independent legal advice, given not by a solicitor but a legal executive, it took reasonable steps to avoid being fixed with constructive notice of the wife's right, as against the husband, to have the mortgage set aside.



(1) The approach of the CA to an appeal against the refusal of a judge of first instance to grant an adjournment was governed by Maxwell v Keun (1928) 1 KB 645. The test in that case was whether the judge's discretion had been exercised so as to result in a denial of justice. However, the court was prepared to approach the case by applying the lower test of whether the decision was unfair to the litigant and thus unreasonable or plainly wrong. (2) The husband's predicament, whilst deserving of sympathy, was not so serious as to make the judge's decision to go ahead with the trial unreasonable or plainly wrong. The judge was evidently satisfied that the trial could be conducted without unfairness to the husband. (3) This was not a case like Maxwell v Keun (supra) where the judge's decision was questioned before the trial began. Where a trial had already taken place, even if the judge misdirected himself, the CA was not bound to order a retrial unless his refusal to grant an adjournment occasioned some substantial wrong or miscarriage of justice (RSC O.59 r.11 now Civil Procedure Rules 1998 Sch.1). This test was not satisfied.

Appeal dismissed.


(1) The court traced the judicial history of the concept of "manifest disadvantage". Observations by the HL in CIBC Mortgages v Pitt (1993) 3 WLR 802 had put a serious question mark over the future of the requirement of manifest disadvantage in cases of presumed undue influence, which had been imposed by the HL in the earlier case of National Westminster Bank Ltd v Morgan & Anor (1985) 2 WLR 588. This caution was shared by the court. (2) The position was therefore as follows. The CA, like the judge, was bound to hold that manifest disadvantage was a necessary ingredient in a case of presumed undue influence. At the same time, the HL had signalled that it might not continue to be a necessary ingredient indefinitely. In the meantime, when seeking for the real meaning of manifest disadvantage, the court had no disposition to enlarge its significance. It meant "clear and obvious" (Cheese v Thomas (1994) 1 WLR 129), but the disadvantage might be small. An objective view had to be taken, and that view had to be taken as at the date at which the transaction was entered into. (3) In this case, the legal charge was an "all monies" charge which enabled the husband, without resort to the wife, to subject the house to much greater financial risks than she could ever have known. That was not outweighed by the advantages of the transaction. (4) Manifest disadvantage having been shown, the wife was entitled to have the legal charge set aside as against the husband by reason of his presumed undue influence over her. (5) The bank took reasonable steps to avoid being fixed with constructive notice of the wife's right as against the husband, to have the mortgage set aside. What was required was independent legal advice, ie advice independent of the mortgagee. Advice given by a legal executive (who was by definition a member of the Institute of Legal Executives) was legal advice and, provided that it was independent and given with the authority of his principal, there was no sound reason for holding it to be inadequate. To hold otherwise was to ignore the realities of solicitors' practice in current conditions, when the responsibility for dealing with matters of this kind was frequently and properly delegated to legal executives. (6) A solicitor who allowed his legal executive to give advice from the address at which he practised necessarily held him out as having the authority to do so. The certificate, which was by a legal executive but made reference to the solicitor's practice, therefore entitled the bank to assume that the advice had been given with the authority of the solicitor. (7) Although the court differed from the judge on both questions, his decision was affirmed.

Appeal dismissed.

* The House of Lords granted an application by Coleman seeking leave to appeal in this case on 26 October 2000. The Appeal Committee had been unable to make unanimous decision to grant leave following a consideration of the applicant's petition and after inviting objections from the respondent. On 25 October 2000 the matter had therefore been referred to a hearing for determination. The appeal was set down for hearing and referred to an Appellate Committee on 15 February 2001.

Court of Appeal
Nourse LJ, Pill LJ, Mummery LJ
Judgment date
21 December 1999

​LTL 23/12/99 : [2000] 3 WLR 405 : [2000] 1 All ER 385 : [2000] 1 FLR 343 : [2000] EG 4 (CS) : Times, January 5, 2000 : Independent, February 21, 2000