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Cite as: [2009] EWHC 1719 (QB)

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Neutral Citation Number: [2009] EWHC 1719 (QB)
Claim No: CC/2008/PTA/0806


Royal Courts of Justice
London WC2A 2LL
Tuesday, 7 April 2009

B e f o r e :


- and -
STELLATO Respondent


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MR S KOVATS appeared on behalf of the Applicant
MR STELLATO appeared in person



Crown Copyright ©

  2. Introduction

    This case concerns the calculation of damages for those unlawfully detained in prison. The respondent to this appeal, Mr Stellato, was awarded some £55,000 at the Oxford County Court. Those were damages for false imprisonment and breach of his rights under Article 5 of the European Convention on Human Rights. The defendant, the Ministry of Justice, appeals to this court on the basis that the learned judge erred in his assessment of the damages, firstly because of his approach to the relevance of Mr Stellato's unlawful behaviour; and secondly, in awarding Mr Stellato anything for loss of opportunity to obtain employment. Moreover, the Ministry of Justice contends that the judge was wrong to hold that he had a discretion to award the defendant less than the judgment rate of interest on costs orders which the Ministry of Justice had obtained against Mr Stellato and which had been set off against the award of £55,000.


  3. In brief, Mr Stellato's claim arose out of a dispute on a point of law. On 17 December 1998 Mr Stellato was sentenced to ten years' imprisonment by the Crown Court at Northampton. He had a long history of offending. He had been born in 1971 and, as of the date of his last conviction in April 2008, to which I will come, he had some 49 fraud and related offences, 82 theft and related offences and a number of other offences, some involving offences against the person, some sexual offences, some property offences, and some public order offences and offences relating to the police. In the event, he was released at the three-quarter point of his 1998 sentence. That was on 27 December 2006, but because 23 December 2006 was the last working day before Christmas he was released on that day.
  4. By the time of his release, Mr Stellato had instituted judicial review proceedings. Permission had been granted by Ouseley J on 19 December 2005. Mr Stellato was seeking a declaration that his release at the three-quarter point should be unconditional release and not release on licence. In fact, the release on 23 December 2005 was release on licence. Mr Stellato contended that unconditional release was demanded as a result of section 33(3) of the Criminal Justice Act 1991. The matter came before the Divisional Court on 31 March 2006, and Mr Stellato's claim was dismissed ([2006] EWHC 608 (Admin)).
  5. Some nine months later, on 1 December 2006, the Court of Appeal heard Mr Stellato's appeal and allowed it. The court declared that he should have been unconditionally released on 23 December 2005 as a result of section 33(3) and that consequently his subsequent detention, which I explain in a moment, was unlawful. The Court of Appeal stayed its order until midday on 21 December 2006 and granted Mr Stellato conditional bail ([2006] EWCA Civ 1639, [2007] 1 WLR 608). The House of Lords gave leave to appeal on 12 December 2006 and ordered:
  6. "... that there be a stay of paragraph 2 of the Court of Appeal order of 1 December 2006 and implementation thereof continued until withdrawn or determination of the appeal or further order."

    Subsequently, the House of Lords heard the appeal. On 28 February 2007 it held that Mr Stellato's argument had been correct ([2007] UKHL 5; [2007] 2 AC 70). At that point, Mr Stellato was released unconditionally.

  7. What had happened in the meanwhile was that Mr Stellato had refused to comply with his licence conditions when he had been released on licence in late 2005. He did that because he said that in law he should have been released unconditionally. The Home Secretary purported to revoke his licence on 28 December 2005 because of this and returned him to prison on 6 January 2006. As I indicated, when the claimant was successful in the Court of Appeal, it stayed its order and granted Mr Stellato bail. That was in December 2006. Mr Stellato then refused to comply with his bail conditions because he said that he could not be on bail if he was not on licence. On 6 December 2006 Hughes LJ issued a warrant for his arrest for breach of bail conditions. He was arrested on 7 December and returned to prison. His bail was revoked by Hughes LJ on 8 December 2006. Once the House of Lords announced its decision on 28 February 2007 he was released unconditionally, as I have said.
  8. To complete the chronology, some time in the later part of September 2007 Mr Stellato committed burglary. On 17 April 2008 he was sentenced to three years' imprisonment by the Crown Court at Northampton. The 119 days which he had spent on remand were taken into account in calculating his sentence. About ten weeks later the sentence expiry date for his 1998 conviction was reached, on 26 June 2008.
  9. The present proceedings were issued on 31 January 2006. Initially they were taken against the Home Office, but in May 2007 the Ministry of Justice assumed responsibility for prisons and so became the proper defendant. In essence, Mr Stellato contended that he was falsely imprisoned from 6 January 2006, when his licence was revoked and he was returned to prison, until 28 February 2007, when he was released as a result of the House of Lords decision. There was a short period between 1 and 6 December 2006 when Mr Stellato was on bail and he conceded that that was not to be taken into account.
  10. The matter was heard by HH Judge Harris QC, in the Oxford County Court on 6 November 2008. Judgment was given on 11 November 2008. In the course of the judgment, the learned judge said this:
  11. "10. The claimant's position in the instant case. He had a very bad record, largely for offences of dishonesty, and was at the end of a substantial sentence for arson. He was no stranger to prison, and had so acted in the past as to return to it often. He had no real reputation to lose. While not enjoying prison, he has to his credit made good use of his time there, and almost wholly avoided bad behaviour, and completely avoided drugs. He has had an acute sense of the impropriety and injustice of what happened to him because he had an excellent understanding of the law in what was a difficult field. It was submitted by the defendants that had he been at large he would have been likely to have re-offended and been re-imprisoned. I bear that possibility in mind, especially since he did indeed re-offend after his eventual release by being involved in a burglary in September 2007, for which he is currently serving a three-year sentence imposed in April 2008. It is also pointed out that he was in breach of the conditions of bail, which he was granted on the 1st December 2006 by the Court of Appeal, which was why the bail was revoked. However, as he points out, there should have been no question of bail at all. There is some rather slight evidence that latterly he had been in such a condition that he has needed to received some treatment for depression.
    11. It was suggested on the defendant's behalf that an appropriate award might be £35,000 to £40,000, so a mid-figure of say £37,500, with no additional for potential loss of earnings. The claimant submitted that a sum in the order of £56,000 would be appropriate, plus a figure for loss of earnings net of expenses, for which he suggests £10,000, making a total of at least some £66,000.
    12. Looking at the matter broadly and taking into account the factors outlined, I have concluded that the proper sum is one of £50,000. To this I add a sum of £5,000 in respect of the loss of a chance to obtain employment. The claimant is an able, fluent and persuasive person, and though his record would be a very heavy and manifest disadvantage to him, he has in the past obtained work once or twice, most recently as a window salesman. He indicated that he could easily have earned £25,000 per annum doing that. Alternatively he might, he says, have done some gardening work. I do not feel able to conclude that on balance of probabilities he would have got a particular job at a particular salary, but do find that there was a respectable chance of him doing some work. Against his net pay, credit would have to be given for living expenses. £5,000 represents the lost chance of some net earnings. It is not a large sum."

  12. The learned judge held that with interest the total amount to be awarded to Mr Stellato was £58,113. The Ministry of Justice's counterclaim was in the sum of £35,298.73 and related to orders it had obtained against Mr Stellato. The learned judge awarded Mr Stellato £1,000 costs on the claim and awarded the Ministry of Justice £500 costs on the counterclaim. He also awarded the Ministry of Justice £8,000 costs in another claim. The upshot was that when these various sums were set off against each other, there was a balance in Mr Stellato's favour of some £15,314.27.
  13. The appeal by the Ministry of Justice to this court falls under three heads.
  14. Ground 1: Mr Stellato's Damages for Non-Pecuniary Loss

  15. Under this head, the Ministry of Justice contends that the judge's calculation of damages for non-pecuniary loss was incorrect. Before considering the reasons it has advanced, three issues should be addressed.
  16. (a) The Law.

    There was no difference between the parties as to the overriding principle which should apply in calculating non-pecuniary damages. These were stated by Lord Woolf MR in R v Governor of Her Majesty's Prison Brockhill, ex parte Evans (No. 2) [1995] QB 1043, at page 1060A-B:

    "The judge accepted a submission on behalf of the governor that there can be two elements to an award of damages for false imprisonment; the first being compensation for loss of liberty and the second being the damage to reputation, humiliation, shock, injury to feelings and so on which can result from the loss of liberty. In this case the second element is absent."

    (b) Period of unlawful detention

  17. The second preliminary point is that in the appeal before me the Ministry of Justice sought to amend its grounds. At the hearing before HH Judge Harris QC it had conceded that the detention of the claimant from 6 January 2006 until 28 February 2007 was unlawful and admitted liability for false imprisonment during that period. Today, the Ministry of Justice seeks to withdraw the concession that the detention of Mr Stellato following the revocation of his bail in early December 2006 was unlawful. It is convenient to deal with this matter now since it determines the overall period of unlawful detention.
  18. As regards damages for loss of liberty, the position is that the Ministry of Justice now contend that the period of unlawful detention ran from 6 January 2006 until 1 December 2006. There is no dispute about the short period between 1 and 6 December when he was lawfully on bail. The Ministry of Justice's argument is that as a result of the issue of the warrant for Mr Stellato's arrest on 6 December 2006, he was then unlawfully at large until arrested the following day. Then as a result of Hughes LJ's revocation of his bail on 8 December 2006 he was lawfully detained until his release on 28 February 2007. Albeit that the House of Lords subsequently held that he had been entitled to unconditional release from December 2005, the Ministry of Justice contends that the arrest warrant and the subsequent revocation of bail were lawful orders of a superior court and, as such, were valid until set aside. Mr Kovats, who appeared for the Ministry of Justice, referred to the decision in Re M [1994] 1 AC 377, 423G:
  19. "Here there are two important considerations. The first is that the order was made by the High Court and, therefore has to be treated as a perfectly valid order and one which has to be obeyed until it is set aside."

    The contention of Mr Kovats is that a person is not entitled to ignore a lawful order of a superior court even if he believes, correctly, that the order is unlawful, and notwithstanding that the order is subsequently set aside on appeal. Mr Stellato refutes that argument. In his view, whatever the position at common law laid down in Re M, Article 5 of the European Convention on Human Rights ("the ECHR") means that his detention pursuant to the orders of Hughes LJ was unlawful.

  20. In relation to Article 5(1)(a), Mr Stellato contends that there is no link between his detention pursuant to the order of Hughes LJ and the original sentence in 1998 of ten years' imprisonment. He refers to several passages in a decision of the European Court of Human Rights in Lloyd v United Kingdom, No. 29798/96, 1 March 2005. In that decision, at paragraph 53, there is a reference to the judgment of Hobhouse LJ in the Evans case. A distinction is drawn by Hobhouse LJ between an ex facie invalid order and an order prima facie valid but which is liable to be set aside. The point is developed further in Mr Stellato's submission by reference to paragraph 102 of the Lloyd judgment, where reference is made to the European Court of Human Rights' decision in Perks & Ors v United Kingdom (No. 25277/94). The contention of Mr Stellato is that, on its face, this order of Hughes LJ was invalid and his detention was not lawful..
  21. Secondly, Mr Stellato contends that Article 5(1)(b) does not apply. There has to be for that exception to apply a lawful order of the court. Here the revocation of the bail was not a lawful order as demonstrated by the later House of Lords decision that Mr Stellato should have been unconditionally released and not subject to any licence conditions such as the imposition of bail.
  22. Moreover, Mr Stellato contends that the exception in 5(1)(c) does not apply as well. He refers here to a decision of Lord Bingham in R (on the application of Smith) v The Parole Board [2005] UKHL 1 at paragraph 36:
  23. "Article 5(1) of the European Convention, so far as relevant, provides:
    'No one shall be deprived of his liberty save in the following cases and in accordance with a procedure prescribed by law:
    (a) the lawful detention of a person after conviction by a competent court ...'
    It seems to me plain that in cases such as the appellants' the sentence of the trial court satisfies article 5(1) not only in relation to the initial term served by the prisoner but also in relation to revocation and recall, since conditional release subject to the possibility of recall formed an integral component of the composite sentence passed by the court. This view may have founded the court's recent admissibility decision in Brown v United Kingdom (Appn No 968/04, 26 October 2004), p.6. The same result was reached in Ganusauskas v Lithuania (Appn No 47922/99, 7 September 1999), where no break was found in the causal link between the original conviction and the re-detention. But the revocation decision must comply with article 5(4), to which I now turn."

  24. Mr Stellato submits, overall, that the orders which were made which resulted in his detention in December 2006 were not prescribed by law. They were not adequately accessible and foreseeable; in other words, formulated with sufficient precision for him to understand their significance. They were on their face invalid. Consequently, none of the exceptions recognised in Article 5(1) ECHR could apply and make his detention lawful.
  25. In my view, the detention of Mr Stellato from 7 December 2006 until his release on 28 February 2007 was lawful. To my mind, at the very least the exception in Article 5(1)(b) ECHR applies. There were clear orders of a superior court which revoked his bail and justified his continued detention. The analogy with the decision in Lloyd and other similar cases does not hold. Those were cases where there were orders of Magistrates' Courts which were, on their face, flawed through procedural defects. Here there was an unimpeachable order of Hughes LJ which justified Mr Stellato's detention, notwithstanding that subsequently the House of Lords held that when he was released at the three-quarter point he should have been released unconditionally.
  26. In my view, the upshot is that the period of unlawful detention is reduced by the days of lawful detention from 7 December 2006 until 28 February 2007. The period of unlawful detention from 6 January 2006 therefore becomes 329 days, rather than 418 days.
  27. The Ministry of Justice was entitled to take this point before this court. It is a pure point of law. There was no different evidence which could have been called or questions put if that point had been taken before the learned County Court judge. Mr Stellato was able to deal with the point before me and in my view suffered no prejudice. In fact, he put cogent arguments to me, albeit that I have rejected them.
  28. (c) The section 116 point

  29. In Mr Kovats' submissions there is a further point which should have been taken into account by HH Judge Harris QC in his calculation of damages. That point is advanced in both a strong and weak version. In essence, section 116 of the Powers of Criminal Courts (Sentencing) Act 2000 provides that if a person is sentenced for a new offence a court can also order him to be returned to prison to serve all or part of the balance of his original sentence. That section has subsequently been repealed by the Criminal Justice Act 2003 but not in respect of offences committed before 4 April 2005 (Criminal Justice Act 2003 (Commencement No. 8 and Transitional and Saving Provisions) Order 2005, S.I.2005 No. 950).
  30. As I indicated earlier, Mr Stellato committed a burglary in September 2007 and was sentenced in April 2008 to three years' imprisonment. The sentencing remarks of HH Judge Alexander at the Northampton Crown Court are short, to say the least. Certainly nothing was said about the operation of section 116 of the Powers of Criminal Courts (Sentencing) Act 2000. Mr Kovats' point is that Mr Stellato could have been ordered to serve the remaining 275 days of his 1998 sentence; in other words, the period from 25 September 2007 when he committed the burglary until 26 June 2008 when the ten years of his 1998 sentence elapsed. Notwithstanding that no order was made, the burglary conviction is relevant, contends Mr Kovats, in two ways. In the assessment of damages for non-pecuniary loss, firstly the court should take into account that Mr Stellato had by committing that new offence of burglary rendered himself liable to be returned to prison for those remaining 275 days of his 10-year sentence. Consequently, HH Judge Harris QC should have awarded him only nominal damages for any part of that 275-day period. The court, in Mr Kovats' submission, should take a broad-brush approach and award Mr Stellato damages on the basis that his good fortune in avoiding the effect of section 116 order pro tanto cancelled out his misfortune in being unlawfully detained.
  31. In its weaker version, Mr Kovats' submission is that that new offending was highly relevant to the loss which the claimant in fact suffered under Lord Woolf's test. By contrast with Miss Evans in the Evans case, Mr Stellato at the time of his detention believed that his detention was unlawful, but the contempt which he demonstrated for the law in committing the new offence within the ten-year period was compelling evidence that he was intent on pursuing his criminal lifestyle regardless of the risk of imprisonment. For completeness, I should say that Mr Kovats accepts that as a matter of law even on the stronger version of his submission section 116 does not result in the wiping out of any unlawful detention.
  32. In my view, as a matter of principle, the effect of section 116 should be taken into account as a factor in the application of Lord Woolf's test. In other words, I accept the weaker version of Mr Kovats' case. The stronger version I reject. It seems to me that it would be in many ways a speculative exercise in cases such as this where there is no way of deciding the result of the application of the section when the sentencing judge did not take it into account. There is also a difficulty, which Mr Stellato pointed to, of sequencing. The impact of section 116 depends very much on the particular time when the subsequent offending occurs.
  33. Thus I accept as a matter of principle that the further offending should be taken into account. That in my view is given support by the approach of the House of Lords in O'Brien v Independent Assessor [2007] UKHL 10, [2007] 2 AC 312, where in the course of his judgment Lord Bingham said:
  34. "[31] I have, and may perhaps express, some reservations about the operation of section 133(4A)(c), although these do not bear on the disposal of either issue in this appeal. Auld LJ, in para 113 of his judgment, well described the purpose of the provision:
    'The mischief at which the provision is directed - the reason for enabling a deduction to be made for criminality from the entirety of the non-pecuniary suffering (save for personal injury) caused by the miscarriage of justice - is, in my view, two-fold. First, it enables account to be taken of the concurrent effect of any punishment for criminal offences of which the claimant has been rightly convicted and sentenced. Second, it allows an Independent Assessor to reflect the fact that an undoubted or hardened criminal may not suffer so greatly as a person of previous good character from many of the incidents of wrongful conviction and loss of liberty, in particular as to harm to reputation, injury to feelings, inconvenience, separation from family and other unpleasant aspects of incarceration …'
    The factors referred to are all, in my opinion, likely to be very relevant. But they are, as it seems to me, factors which can and should be inherent in any assessment of the non-pecuniary loss suffered by any wrongly-imprisoned claimant: it is of the highest relevance that a claimant would have been in prison in any event or had a very bad criminal reputation independently of the offence of which he was unjustly convicted. Thus I would expect account to be taken of these matters at the first stage of the assessment rather than to base that assessment on assumed and fictional facts. But if account is taken of such matters at the first stage of the assessment, I am unclear what justification there can be for making a percentage deduction at a later stage. This matter, not raised by counsel in argument, perhaps merits consideration."

  35. What I understand Lord Bingham to be saying that the criminality of the claimant in the broadest sense is relevant to the loss which he suffers from a period of wrongful imprisonment. It is clear from the judgments of Lord Bingham and the other law lords that their consideration of the issue is not confined to situations where the person is imprisoned for concurrent sentences. Wrongdoing in the broadest sense needs to be taken into account.
  36. Notwithstanding that I accept the principle, at least in the weaker version as advanced by Mr Kovats it is not, in my view, applicable in this case. That is because of the way the Ministry of Justice put the argument before HH Judge Harris QC. They did not raise the issue directly. There is a reference in their submissions before the learned judge to a predecessor provision of section 116. That section was redundant given the date of the subsequent offending. It also differs in some respects from section 116.
  37. In terms of the issue which Lord Bingham raises in the O'Brien case, namely that a court needs to take into account the criminal wrongdoing of claimant, whether or not he has a bad criminal reputation independently of the offence for which he was unjustly detained, it seems to me that the learned judge did address that matter. He referred to the subsequent burglary. In other words, he did consider it, perhaps not as clearly as he might have done if the Ministry of Justice had put the point clearly to him. To my mind, it is too late now for the Ministry of Justice to redress any shortcomings in the case they advanced before the learned judge.
  38. (d) Assessment

  39. I turn now to the main issue under this ground, the assessment of damages. The law in this regard is laid down in decisions such as the O'Brien and Evans cases already referred to. In Evans the claimant was awarded some £5,000, just over £6,500 in today's prices, for 59 days' excessive detention in prison ([1999] QB 1043 at 1060B-H, 1070B-C and 1078F). As indicated, that case differed somewhat from the present litigation. In O'Brien the awards were around £142,000 for 13 years and 8 months' unlawful detention and £200,000 for 12 years, 10 months' unlawful detention. The latter, however, included a substantial award for psychiatric injury. There are other decisions such as Thompson v Commissioner of Police of the Metropolis [1998] QB 498 which, in my view, are not directly applicable because they involve persons who were of good character at the time they were unlawfully detained.
  40. Before me, Mr Stellato distinguished Evans on various grounds. He said, for example, that his behaviour was quite different from Miss Evans. To his credit he had made good use of his time in prison, had obtained various qualifications and had not been involved in bad behaviour, whereas in her case she had committed disciplinary offences. He also highlighted what he characterised as the bad behaviour of the Ministry of Justice. Despite permission granted by Ouseley J on the judicial review, the Ministry stood their ground and rejected his contention that release at the three-quarter point should be unconditional. He also pointed to the difference in the states of knowledge between Miss Evans and himself. Miss Evans did not know and had no reason to think that she was not properly detained, whereas he had in the finding of the learned judge an acute sense of injustice as too what had happened to him. For some considerable time he had maintained that from the three-quarter point he should be unconditionally released. Mr Stellato also makes various other points such as his legitimate expectation and the fact that he had already been out for two weeks and had found a place to live when he was suddenly taken back into detention on 8 December 2006.
  41. In my view, the award by HH Judge Harris QC does seem to be somewhat beyond the amounts awarded in the cases I have cited. It is accepted on both sides that the amount should preferably be a lump sum rather than a figure based on a daily tariff. Mr Kovats submitted that the test to be applied was comparable to the test applied when the Court of Appeal, Criminal Division, considers a sentence to be manifestly excessive. In his submission, the difference between the £50,000 which the learned judge awarded, and the £40,000 which on his calculation should have been awarded, meant the former was manifestly excessive. It would not be mere tinkering, to use the terminology sometimes invoked by the Court of Appeal, Criminal Division, to reduce the amount from £50,000 to £40,000.
  42. I resist the temptation to interfere in this case. As I have said, the amount of £50,000 does seem higher than might have been awarded by the application of the guideline cases. However, it was a matter for the learned judge. He tried the case. He heard Mr Stellato give evidence. He had all the factors in mind. I cannot say that he was wrong in his calculating the £50,000 amount.
  43. Ground 2: Mr Stellato's Damages for Loss of Employment Opportunity

  44. HH Judge Harris QC awarded Mr Stellato £5,000 for the loss of a respectable chance of his engaging in employment. The background was that Mr Stellato gave evidence, and it was accepted, that he had been employed as a door-to-door window salesman for a short period. That was brought to an end by the probation service, who took the view that it was not appropriate for him to be employed in that trade given the nature of his criminal record. Mr Stellato says, of course, that he should not have been subject to any conditions and that included supervision and direction by the probation service. Consequently, the judge was entitled to make the award.
  45. There seem to be no clear principles on this matter in the Lloyd v United Kingdom decision mentioned earlier. The European Court of Human Rights had awarded Mr Lloyd €3,000 for loss of a job offer due to his unlawful detention, as a result of which he was unemployed for some ten months. In my view the issue is one of fact. Certainly a judge deciding the matter does not need to have clear evidence that a particular job has been offered or that any job offer has been taken up, nor does a claimant need to go as far as demonstrating that there is a job with a particular salary attached to it. However, there must be evidence as a result of which a judge can conclude on the facts that a claimant has lost the opportunity of employment.
  46. In this case, Mr Kovats submits that there was no documentary evidence about any job other than the job as the window salesman. Despite this, the learned judge seems to have mentioned several jobs. Moreover, Mr Kovats submits that the claimant would have been unable to take employment because of his injured knee, an injury sustained as a result of his attempting to escape from lawful arrest following the revocation of his bail. Consequently, it was not proper to award damages for pecuniary loss under this head. Finally, Mr Kovats says that as soon as any employer knew about Mr Stellato's criminal record he would not have been employed. There is also the sad fact that even in good economic times the chance of those coming out of prison obtaining employment is less than for those without a criminal record.
  47. In my view, the learned judge in this case was entitled to come to the conclusion he did. He had the evidence before him. He was entitled to take into account that Mr Stellato had obtained employment. Mr Stellato informed me in argument that many of his convictions were spent convictions, having been committed ten years prior to the date of the hearing. I am in no position to assess any of this in detail. It was a factual matter and the learned judge embarked upon the inquiry and reached a conclusion. I am not prepared to say that he was wrong in that regard.
  48. Ground 3: The Counterclaim

  49. The counterclaim relates to the award of interest at a rate of 2 per cent, rather than the judgment rate of 8 per cent, on one of the judgments which the Ministry of Justice had obtained in its favour when it was sued by Mr Stellato. In the course of his judgment, the learned judge said that the rate of interest was a matter of discretion.
  50. The law in this regard is set out in section 74 of the County Courts Act 1984 which provides that sums payable under judgments or orders in the County Court shall carry interest at such rates and between such times as may be prescribed by the Lord Chancellor in a statutory instrument (subsections (1), (2)(a) and (6)). The Lord Chancellor may in the exercise of this power provide that the rate of interest shall be the rate specified in section 17(5) of the Judgments Act 1838. As a result of the County Courts (Interest on Judgments Debts) Order S.I.1991, No. 1184, a County Court judgment for at least £5,000 carries interest at a rate for the time being specified in section 17 of the Judgments Act 1838. That rate at the material time was 8 per cent. It is possible for rules of court to provide that the court can disallow all or any part of interest otherwise payable under subsection (1), but no rules of court have been made. The White Book states clearly that the court cannot vary this rate of interest. In other words, the rate of interest is mandatory and not a matter of discretion.
  51. Mr Stellato submitted that he had a potential judgment in his favour which ultimately crystallised in the decision of HH Judge Harris QC. That meant that there was a potential set-off in his favour and, in terms of section 2(1) of the 1991 Order, there was no amount which remained unsatisfied. In short, in his submission he did not owe money to the Ministry of Justice.
  52. In my view, the legislative effect is clear. Mr Stellato owed the money. Until the judgment of HH Judge Harris QC there was no judgment in his favour as a result of which he could set off amounts owed him. He never made tender of the amounts owing to the Ministry. Notwithstanding the fact that he had filed this claim in January 2006, there was no possibility of a set-off until the judgment of the court.
  53. The upshot is that I allow this appeal to a limited extent, first of all, in relation to the length of unlawful detention and, secondly, in relation to the calculation of interest on the amounts owed by Mr Stellato to the Ministry of Justice.

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