Court of Appeal Clarifies When a New Point May Be Taken on Appeal


On 25 July 2019 the Court of Appeal handed down judgment in Notting Hill Finance Limited v Sheikh [2019] EWCA Civ 1337 (judgment available here: Notting Hill v Sheikh). The case provided important guidance on the principles to be applied when considering whether a new point, not raised in the court below, can be taken on appeal.


The case arose out of a mortgage possession claim brought by Notting Hill Finance (‘NHF’). The parties had entered into an unregulated loan agreement that included a business purposes declaration and was secured over Mr Sheikh’s (‘S’) home. By a term of that agreement, the interest payable on the loan rose from 30.04% per annum to 289.6% per annum on default. S defaulted and NHF issued possession proceedings in the County Court.

At the first hearing, S was represented by the court duty adviser. No substantial defence was raised or identified, and an order was made granting both possession and a money judgment (including interest at the uplifted rate) to NHF.

Subsequently, S engaged solicitors and a potential defence to the money claim was identified. Specifically, S alleged that the uplift in interest on default was a common law penalty and, further, formed the basis of an unfair relationship within the meaning of sections 140A-C of the Consumer Credit Act 1974 (‘CCA’). S appealed, seeking to set aside the money judgment and enter his defence and counterclaim.

On appeal, NHF accepted that there was merit in S’s proposed defence but argued that S should not be permitted to raise these new arguments on appeal as they had not been raised at the first hearing. HHJ Godsmark QC, referring to the cases identified in the commentary in the White Book, applied Jones v MBNA International Bank Ltd [2000] EWCA Civ 314 and concluded that ‘an appellate court can entertain on appeal a point not taken in the court below but the circumstances will be unusual if not exceptional’. The judge then went on to identify a number of features that rendered S’s case ‘exceptional’, including the fact that the first hearing had been summary in nature and that S was effectively a litigant in person. He therefore allowed the appeal and gave directions for the trial of the default interest issue.

NHF appealed to the Court of Appeal.

On appeal, NHF argued first that HHJ Godsmark QC had been wrong to conclude that the facts of the case were ‘exceptional’ as the failure by a defendant to prepare or advance a defence for a first hearing under CPR 55 was ‘entirely routine’. Second, NHF contended that litigation in England and Wales was based on the adversarial system and that the district judge could not be faulted for not having taken the penalty point or the CCA point of his own motion. Consequently, there had been no serious procedural or other irregularity on which S could rely to overturn the district judge’s judgment.


The court’s judgment as given by Snowden J, with whom Longmore and Peter Jackson LJJ agreed.

Although NHF’s appeal was dismissed, the Court of Appeal held that the correct test to be applied was not that in Jones, but rather that in Pittalis v Grant [1989] QB 605 (at 611). The court described it as ‘surprising’ that the commentary in the White Book did not refer to Pittalis, and went on to elaborate on the test to be applied in determining whether a new point can be raised on appeal for the first time. Whether to permit such a point was a matter for the court’s discretion. There was no general rule that a case need be ‘exceptional’ before a new point could be taken:

‘… there is no general rule that a case needs to be “exceptional” before a new point will be allowed to be taken on appeal. Whilst an appellate court will always be cautious before allowing a new point to be taken, the decision whether it is just to permit the new point will depend upon an analysis of all the relevant factors.  These will include, in particular, the nature of the proceedings which have taken place in the lower court, the nature of the new point, and any prejudice that would be caused to the opposing party if the new point is allowed to be taken.’ (at paragraph 26) (emphasis added)

Despite this, HHJ Godsmark QC had correctly identified the relevant factors in exercising his discretion:

  1. The limited nature of a CPR 55 possession hearing meant that there had not been a trial in any real sense before the district judge;
  2. It was clear that, had the penalty/CCA points been raised before the district judge, the hearing would have resulted in directions rather than judgment;
  3. S had acted quickly to raise the new points after judgment against him was given and NHF had suffered no prejudice in acting in reliance on that judgment;
  4. The failure to raise the penalty/CCA points had not resulted in a wasted hearing, as the possession order and the money judgment for the principal amount were unchallenged.

Notably, the court did not find it relevant that S was a litigant in person (at paragraph 36).

As a result, the Court of Appeal upheld the decision of HHJ Godsmark QC, dismissed the appeal, and remitted the matter for trial.

Robin Kingham of Chambers was instructed by Jennifer Whitwam (Attwood & Co) on behalf of the Respondent.