1977 Mar. 24 ZENON ACHILLIDES v. VYRON MICHAEL1DES [HADJIANASTASSIOU, A. LOIZOU, MALACHTOS JJ.] ZENON ACHILLIDES, Appellant-Plaintiff, v. VYRON MICHAELIDES, Respondent-Defendant. (CivilAppeal No. 5032). Credibilityof witnesses—Findings of fact made by trial Courtdepending on credibilityof witnesses—Appealturning on such findings—Approach of Court of Appeal—Claim fordeclaratory judgment regardingbalance of mortgage debt and for cancellationof mortgage—Two conflictingversions—Respon- 5 dent's version preferredby trial Court which gave goodreasons for doing so—Appellant failed to discharge onus resting onhim to persuade Courtof Appeal that thereasoning behind the findings of the trialCourt wasunsatisfactory or thatsuch findingswerenot warranted by theevidence—On the contrary 10 Courtof Appeal satisfied from the evidenceadduced,thatthe trialCourtwasjustifiedinarriving at the conclusions it did. The appellant-plaintiff appealed against the dismissal of his claim for a declaratory judgment concerning the balance due under a mortgage and for a cancellation of a mortgage. The 15 trial Court having considered and weighed the wholeevidence, including the documents and the accounts produced by the parties, decided not to accept the evidence of the plaintiff as regards the items in dispute but on 'the contrary it accepted as true the evidence of the defendant, which evidence as stated 20 in its judgment, impressed the Court favourably and gavegood reasons for doing so. The appeal therefore turned solely on the issue of credibility ofwitnesses. Held, (after stating the principles on which an Appellate Court will interfere with findings of fact made by the trial 25 Court which depend on credibility of witness—vide pp.179-180 post) that the appellant did not discharge theonuswhichrested on him to persuade this Court that the reasoning behind the findings of the trial Court was unsatisfactory or that such findings were not warranted by the evidence; and that on the 30 contrary, this court is satisfied that from the evidence adduced 172 the trial Court was justified in arriving at the conclusions it did. Appeal dismissed. Cases referred to: 5 Charalambous v. Demetriou, 1961 C.L.R. 14 at p. 19; Mamas v. The Firm "Anna" Tyres
(1966)1 C.L.R. 158 at p. 160; Thomaides & Co. Ltd. v. Lefkaritis Bros
(1965)1 C.L.R. 20; Patsalides v.Afsharian
(1965)1C.L.R. 134; 10 Clarke v. Edinbourgh Tramways Co. [1919]S.C. (.H.L.) 35 at P-36; Watt or Thomas v. Thomas [1947] A.C. 484. Appeal. Appeal byplaintiff against thejudgment of the District 15 Court of Limassol (Loris, Ag.P.D.C. and Hadjitsangaris, D.J.) dated the29th November, 1971,(Action No.3170/ 69) dismissing hisclaim for, interalia,a declaratory judgment to the effect that the amount due by him to thedefendant under amortgagewas £1,067.20 St,McBride,for theappellant. P.L. Cacoyiannis,for therespondent. Cur.adv. vult. HADJIANASTASSIOU, J.: The judgment of the Court willbedeliveredbyMr.JusticeMalachtos. 25 MALACHTOS,J.:Thisis an appeal by theplaintiff from the judgment of the Full District Court of Limassol in ActionNo.3170/69 dismissinghisclaimfor(
- a)A declaratory judgment to the effect that the balance due on 13.11.69 by the plaintiff to the 30 defendant under Mortgage No. H109760/66 is £1,067.-; (
- b)AnOrder of the court directing the cancellation of mortgage registered with the D.L.O. of Limassol under No. H109760/66 which expires 35 on 27.11.69 on payment or tender by theplaintiff to the defendant of £ 1,067.-together with 173 1977 Mar. 24 ZENON ACHILLIDES v. VYRON MICHAELIDES 1977 Mar. 24 ZENON ACHILLIDES v. VYRON MICHAELIDES interestthereon at 7%per annumfrom 14thNovember, 1969. Therelevantfacts areasfollows:,On 28.11.63 the plaintiff who is a dealer in land, and who is also running apetrol station in Limassol, mortga- 5 ged to the defendant certain properties in order to secure a loan and the relevant registration of the said mortgage was made at the D.L.O. Limassol and Certificate No. H96271/63 was issued. The aforesaid mortgagedebt was for £.25,000.- plus £6,000.- interest, which was interest 10 at 6%per annum onthecapitalfor four yearsupto 27.11. 67, the period at the end of which the debt wasbecoming due and payable. On 20.3.64, in consideration of the release by the defendant from the aforesaid mortgageof twoplots ofmort- 15 gaged property, theplaintiff executed in favour of thedefendant a bond incustomaryform for thesumof £ 1,400.payable on 31.12.65 with interest thereon at the rate of 6%per annumfrom thedayof execution. On 25.1.65 the parties entered into an agreement in 20 writing by virtue of which the defendant had undertaken, interalia,to extend the timeof repayment of the aforesaid mortgage registered under H96271/63 for another two years after its original expiration, on 27.11.67. The mortgaged property consisted of 53 building sites 25 and by Term 4 of the agreement between the litigants dated 25.1.65, it was agreed that for each one of thefirst 13 building sites the plaintiff would sell, he would have been paying to the defendant the sum of £400.- and for each one of the subsequent 40 building sites the sum of 30 £650.-, the defendant having undertaken to credit the account of the mortgage of the plaintiff with the relevant amounts and also to release each one of the building sites for each respectivepayment that would havebeen made. On the same day, i.e. 25.1.65, the plaintiff executed a 35 bond in customary form in favour of the defendant for the sum of £3,000.- payable on 27.11.67 withinterest thereon of 7% per annum, from the day when same was becoming payable. 174 It is common ground that the consideration for this bond was the interest for two years, which accrued under the mortgage debt. This bond of 25.1.65 for £3,000.formed later the subject matter of Action No. 120/68 of 5 the District Court of Limassol which resulted in a settlement, the appellant being adjudged to pay to the respondent thesumof £ 1,070.020mils. On 2.2.65 Mortgage No. H96271/63 was cancelled andsubstituted by another mortgage which was registered 10 in theD.L.O.books under No. H101706/65. The capital of this mortgage is mentioned in the mortgage bond as £25,000.- There is also interest of £6,000.- for theperiod 28.11.65 up to 27.11.69 when this mortgage was madedue andpayable.Thecapital of this second mortga15 ge, as referred in the mortgage bond, is £23,600.- due under the old mortgage H96271/63 plus £1,400.- cash. This sum is admittedly not paid by the respondent to the appellant but it was inserted there in order to facilitate the appellant in paying less mortgage fees to the D.L.O. 20 Under this arrangement the appellant paid £ 15.200mils mortgagefeesbecausethe amount of the second mortgage wasidentical with that of the first mortgage, whereas had it not been so, the mortgage fees would have been £236.100 mils. 25 It should be noted here that this item of £ 1,400.-the subject matter of this transaction, was the one of thetwo itemsindisputebetweenthelitigants. The version of the respondent on this item is that there wasan agreement with the appellant to deduct the sumof 30 £.1,400.- from the mortgage, andfor this reason hemade an endorsement at the back of the certificate of mortgage thathehadreceived on thesameday thesum of £ 1,400.The appellant's allegation is that the endorsement was made because on that very same day, that is 2.2.65, he 35 had paid in cash to the respondent this sum of £1,400.The mortgage H101706/65, which was to expire on 27.11.69,wassubstituted on 29.11.66 by another mortgage registered with the D.L.O. Limassol under certificate of mortgageNo.H109760/66. The capital of thismortga40 gewas again £25,000.- and there wasinterest thereon at 175 1977 Mar. 24 ZENON ACHILLIDES v. VYRON MICHAELIDES 1977 .l24 Ma ZENON ACHILLIDES v. VYRON MICHAELIDES 67o per annum from 28.11.65 to 27.11.69 amounting £ 6 >°00.-° n t n e mortgage bond of this mortgage, an endorsement appears signed by the defendant to the effect tnat ne received on 29.11.66 against the said mortgage the sum of £ 1,200.- The respondent did not deny having 5 signed this endorsement but his allegation was that he s ig n e d it on 1.12.66 and not on 29.11.66 in order to cover the building sites which were excluded from this mortgage, which building sites were, in fact, two and not three. At the time of so signing he alleged that he did not have with 10 him his own mortgage certificate and he waslabouring under a mistake that thebuilding sitesreleased from themortgage were three and that is why he signed the endorsement for £.1,200.- He also alleged that he discovered his mistake two to three days later and thereupon accompanied 15 by a certain Kyriacos Lofitis and his father-in-law, who gave evidence as D.W.3 and D.W.4, respectively, went to the petrol station of the plaintiff and protested to him that actually two building sites were released by the payment by the appellant of the sum of £800.- But the plaintiff 20 would not listen and his reply was that "What is written is written". This sum of £1,200.- was the second item in dispute between thelitigants. In support of his case the appellant gave evidence before the trial court and called no other witnesses. His ver- 25 sion was all along, as already stated earlier in this judgment, that the amounts of £1,400.- and £1,200.- which are the only amounts in dispute between the litigants, and which are endorsed on the relevant mortgage deeds, were paid by him to the respondent in cash. On the other hand, 30 the version of the respondent, which was supported on material points by the evidence of his father-in-law and the D.L.O. clerk D.W.2, was that as regards the amount of £ 1,400.-, which was neither paid by him to the appellant nor was it paid in cash by the appellant to him on 2.2.65, 35 when Mortgage No. H101706/65 was registered in the D.L.O. books, was deducted at the request of the appellant from the claim of the respondent in Action No. 120/ 68 instead from the mortgage debt as originally agreed. As to the amount of £ 1,200.- the respondent admitted 40 that on 29.11.66 he received the sum of £400.- and released from the mortgage the building site under Registration No. 19607 and on 30.11.66 the sum of £400.- and 176 released from the mortgage the building site under Registration No. 19591. Some time later acting under the erroneous belief, as at the time he was not holding the certificate of mortgage to check that the number of the build5 ing sites released on 29th and 30th November, 1966 were three instead of two, made a note that on 29.11.66 he received towards the mortgage debt £1,200.- For the sum of £ 800.-, which he received on 29th and 30th November, 1966, the respondent stated that the appellant ap10 pears in hisaccounts as already credited. 15 20 25 30 35 The trial court indealing with thefirst item of £ 1,400.in its carefully considered judgment said that one would not expect a man who was mortgaging properties-with a view to obtaining credit for £25,000.- plus £6,000.- interest, to pay back on the same day the sum of £1,400.Further the court added that it could not lose sight of the fact that as late as in 1968, when the parties came before the court in Action No. 120/68 the appellant had mentioned in hisdefence and counter claim raised in the aforesaid action, payment of £1,663.- and payment of other minor sums totalling £118.359 mils complaining to the court that none of these amounts were deducted from the mortgage of 1963 or from the mortgage of 1965. The court further added that the appellant never mentioned that he paid on 2nd February, 1965, the sum of £1,400.in cash against the mortgage of 1965 and although in Action No. 120/68 the parties had settled their accounts no mention was ever made anywhere that the sum of £1,400.- was paid in cash. The court then came to the conclusion that it was obvious that the appellant was trying to take advantage of the endorsements signed at the back of the mortgage deeds. The court further stated that the defendant gave an explanation for these endorsements and having gone through the whole of the evidence and having examined thoroughly all the documents produced before it, it was satisfied that the respondent in this appeal was telling the truth and dismissed the action with no order as to costs. In arguing this appeal before us counsel for the appel40 lant confined himself on the following two grounds:(
- a)that the trial court was wrong in finding that the sum of £1,200.- was not actually paid; and 177 1977 Mar. 24 ZENON ACHILLIDES v. VYRON MICHAELIDES 1977 Mar. 24 ZENON ACHILLIDES v. VYRON MICHAELIDES (
- b)as regards the sum of £ 1,400.-, whichever version is believed, he was nevertheless entitled to a declaration that this sum should bededucted from the mortgage. On this second ground counselfor theappellant argued 5 that since the parties had agreed that the amount of £ 1,400.- was to be deducted from the mortgage and in fact themortgagedebtwasreduced, thisamountcouldnot bebrought back from an unsecured debt to a securedone. He referred to section 21 of the Immovable Property 10 (Transfer and Mortgage) Law, 1965, which deals with declarations of mortgagor and mortgagee and documents to be produced at theD.L.O. when a mortgage is to be registered and said that he could find no provision in that section allowing such a course. The short answer to this 15 submission is that there is no provision in this section either, prohibiting such a course ifit is donewith theconsentof theparties concerned. Counsel for the appellant also submitted that whether the sum of £ 1,400.-was paid in cash as the plaintiff al- 20 leged at the trial or whether it was not paid in cash but was so recorded to facilitate the plaintiff to pay lesser D.L.O. fees, it had to be deducted from the sum of £25,000.- so as to reduce the mortgage debt to the amount of £23,600.- which was the amount admitted by 25 thedefendant as actuallydue. This allegation of counsel would have certainly been correct had the matter remained at that. The defendant, however, gave an explanation that by agreement of the parties this amount of £1,400.- was deducted from the 30 debt due on the bond of £3,000.-, which was the subject matter of Action No. 120/68 and this explanation was accepted bythetrial court. So, this appeal turns really on theissue of credibilityof witnesses. The trial court having considered and weighed 35 the whole evidence, including the documents and the accounts produced by theparties, decided not to accept the evidence of the plaintiff as regards the two items in dispute, but on the contrary accepted as true the evidenceof the defendant, which evidence, as stated in its judgment, 40 impressed the court favourably and gavegood reasons for doing so. 178 The principles on which an Appellate Court can interfere with findings of fact made by the trial court which depend on credibility of witnesses, are well known and have been stated in a line of cases both here and in Eng5 land. In the case of Philippos Charalambous v.Sotiris Demetriou, 1961 C.L.R. 14,Zekia J., as he then was, said at page 19: 10 15 "While I am far from being satisfied of the way some judgments are given by trial courts where without stating adequate reasons dispose of an issue in the case by merely saying *1 believe or disbelieve so and so', I will hesitate a lot on the other hand to introduce a principle the application of which might have the effect of amending the Evidence Law which would constitute a transgression on our part of the rights of the legislature". The special interest of this case lies in the fact that it closes the cycle of judicial pronouncements in Cyprus under thelaw as it stoodprior to theenactment of the Courts 20 of JusticeLaw, 1960, on the powers of a Court of Appeal in reviewing findings of fact of trial courts based on the credibility of witnesses. In Sojocles Mamas v. The Firm "Arma" Tyres
(1966)1 C.L.R. 158 at page 160, Vassiliades J., as he then was, 25 referred to thecase of Thomaides & Co. Ltd. v. Lefkaritis Bros
(1965)1 C.L.R. 20 and to the subsequent case of Patsalides v. Afsharian
(1965)1C.L.R. 134 and said: 30 "The findings of the trial court will not be disturbed on appeal, unless the appellant can satisfy this court that the reasoning behind such findings is unsatisfactory, or that they are not warranted by the evidence when considered as awhole". In Clarke v. Edinbourgh Tramways Co. [1919] S.C. (H.L.)35, at page 36, Lord Shaw had this to say: 35 40 "When a judgehears and sees witnesses and makes a conclusion or inference with regard to what is the weight on balance of their evidence that judgment is entitled to great respect, and that quite irrespective of whether the Judge makes any observation with regard to credibility or not". 179 1977 Mar. 24 ZENON ACHILLIDES v. VYRON MICHAELIDES 1977 Mar. 24 ZENON ACHILLIDES v. VYRON MICHAELIDES in Watt or Thomas v. Thomas [1947J A.C. 484, a HouseofLordscase,itwasdecidedthat: "When a question of fact has been tried by a judge without a jury and it is not suggested that he has misdirected himself in law, an appellate court in re- 5 viewing the record of the evidence should attach the greatest weight to his opinion, because he saw and heard the witnesses, and should not disturb hisjudgmentunlessitisplainlyunsound.Theappellatecourt is, however, free to reverse his conclusions if the 10 grounds given by him therefor are unsatisfactory by reason of material inconsistencies or inaccuracies or if it appears unmistakably from the evidence that in reaching them he has not taken proper advantageof having seen and heard thewitnesses or has failed to j5 appreciate the weight and bearing of circumstances admitted or proved". In this appeal weare of theview that the appellant did not discharge the onus which rests on him to persuade us that the reasoningbehind thefinding of thetrial court was 20 unsatisfactory or that such findings are not warranted by the evidence. On the contrary, we are satisfied that from the evidence adduced, the trial court was justified in arriving attheconclusions itdid. For the reasons stated above this appeal is dismissed, 25 with costs. Appealdismissedwithcosts. . ISO