Amanda Stephanie Clutterbuck and Another (Claimants/Appellants) v William Cleghorn (as judicial factor to the estate of Elliot Nichol deceased)
| Jurisdiction | England & Wales |
| Judge | Lord Justice Kitchin,Lord Justice Floyd |
| Judgment Date | 21 March 2017 |
| Neutral Citation | [2017] EWCA Civ 137 |
| Docket Number | Case No: A3/2015/3573 |
| Court | Court of Appeal (Civil Division) |
| Date | 21 March 2017 |
[2017] EWCA Civ 137
Lord Justice Kitchin
Lord Justice Floyd
Case No: A3/2015/3573
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
Edward Murray (sitting as a Deputy Judge of the Chancery Division)
HC13E04392
Royal Courts of Justice
Strand, London, WC2A 2LL
The Claimants/Appellants appeared in person
Jonathan Seitler QC and Ms Emer Murphy (instructed by Squire Patton Boggs (UK) LLP) appeared for the Defendant/Respondent
Hearing date: 18 January 2017
Approved Judgment
Introduction
This is an appeal by the claimants, Ms Amanda Clutterbuck and Mr Ian Paton, against the decision of Mr Edward Murray, sitting as a deputy judge of the Chancery Division, dated 11 September 2015 and his consequential order dated 9 October 2015 striking out their claim against the defendant, Mr William Cleghorn, as the judicial factor to the estate of Mr Elliott Nichol, entering judgment for Mr Cleghorn and ordering the claimants to pay to Mr Cleghorn his costs of the action. The claimants now appeal with permission granted by Sir Timothy Lloyd by order dated 13 January 2016.
There is also before the court an application by the claimants for permission to adduce new evidence upon this appeal. That application was refused upon the papers by Lewison LJ by order dated 19 December 2016. The claimants requested that this decision be reconsidered at an oral hearing and so it is that it has come before the court with the substantive appeal.
Background
The claimants were at all relevant times property developers of residential properties in central London and, at least until the commencement of these proceedings in August 2013, lived together as man and wife. Their claim related to various agreements which they contended they entered into with Mr Nichol, a Scottish businessman who died on 29 December 2009. Mr Cleghorn was appointed as judicial factor of Mr Nichol's estate ("the Estate") on 30 September 2011 by the Court of Session in Edinburgh. He is required to administer the Estate under the Scottish procedure of judicial factory and subject to the supervision of a court appointed officer known as the Accountant of Court.
The claim had three elements which I shall refer to as the "Pont Street Claim", the "Oriel Claim" and the "Cliveden Claim".
The Pont Street Claim
The claimants contended that in about July 2004 they, Mr Nichol and Ms Sarah Al Amoudi, whom Mr Nichol had represented to be a potential investor, agreed they would enter into a joint venture agreement ("the Pont Street JVA") to purchase and develop a property at 66 Pont Street, SW1. They also contended that the parties had, in addition, agreed to purchase and develop the neighbouring properties at 62 and 64 Pont Street. The profits made from the joint venture were, they said, to be divided equally between the claimants, on the one hand, and Mr Nichol and Ms Al Amoudi, on the other hand.
The claimants complained that the development did not take place as agreed as a result of breaches of the Pont Street JVA by Mr Nichol and that they had, in consequence, suffered losses in excess of £1 million.
The Oriel Claim
The claimants alleged that in about September 2005 they met Mr Nichol at the Oriel restaurant in Sloane Square and made an oral agreement as to the terms upon which they would undertake future joint ventures together ("the Oriel Agreement"). They contended the terms of the agreement were, inter alia as follows. The claimants would use their expertise to find properties suitable for development; the claimants would offer these properties to Mr Nichol and a consortium of investors, including Ms Al Amoudi, represented by Mr Nichol; that Mr Nichol, on his own behalf and on behalf of the members of the consortium, would be given a right to accept or reject the claimants' proposal to enter into a joint venture in respect of that property; and that if Mr Nichol accepted the offer, then a joint venture would be entered into pursuant to which Mr Nichol would ensure the provision of the necessary funds, the claimants and Mr Nichol would develop the property and the profits derived from the development would be split equally between the claimants, on the one hand, and Mr Nichol and the members of the consortium, on the other hand.
The claimants asserted that, pursuant to the Oriel Agreement, the parties entered into joint ventures for the development of six properties, only one of which, that in respect of 9 Cliveden Place, was the subject of a written agreement. The properties were:
i) Herbert Crescent, SW1;
ii) 19 Basil Street, SW3;
iii) 50 Cadogan Square, SW1;
iv) 8 Walton Place, SW3;
v) 36 Drayton Court, SW1; and
vi) 9 Cliveden Place, SW1.
The claimants contended that Mr Nichol acted in breach of the Oriel Agreement in relation to each of the six properties and that they had, as a result, suffered losses in excess of £40 million (excluding the losses in respect of 9 Cliveden Place).
The Cliveden Claim
On 3 August 2006 and allegedly pursuant to the Oriel Agreement, the claimants, Westbrooke Properties Limited ("Westbrooke"), an Isle of Man company beneficially owned by Mr Nichol, and Mr Nichol, as guarantor, entered into a written joint venture agreement ("the Cliveden JVA") concerning the development of 9 Cliveden Place. The claimants contended (i) that Mr Nichol fraudulently or negligently misrepresented the value attributed to the property by the Bank of Ireland, one of the funders of the development, and that this misrepresentation reduced the sums payable to the claimants under the agreement; (ii) that Westbrooke acted in breach of the agreement in various ways; (iii) that various sums were due and owing to them under the agreement in any event; and (iv) that they had, as a result, suffered losses and were owed sums amounting to in excess of £2.5 million for which Mr Nichol was liable as a result of his misrepresentations or as guarantor.
Mr Cleghorn defended the whole claim. He denied that Mr Nichol entered into any binding contractual agreement with the claimants, save in relation to 9 Cliveden Place. He therefore denied the whole of the Pont Street Claim and the whole of the Oriel Agreement Claim.
More particularly in relation to the Cliveden Claim, Mr Cleghorn denied that Mr Nichol misrepresented the value attributed to 9 Cliveden Place by the Bank of Ireland and maintained that the valuation of the property in the Cliveden JVA reflected the parties' understanding of the value of the property as it then stood. Mr Cleghorn also denied that Westbrooke had been in any way in breach of its obligations under the Cliveden JVA or that any sums were due and owing to the claimants.
Finally and importantly, Mr Cleghorn asserted that the whole claim was liable to be struck out as an abuse of process in that it amounted to a "shorn-down" repetition of the claims unsuccessfully brought by the claimants against Ms Al Amoudi in action number HC12A02469 ("the Al Amoudi proceedings") and that this claim ought to have been brought in the context of those proceedings. It is this final aspect of the defence which gave rise to the strike out application.
The Al Amoudi proceedings
In these proceedings, issued in January 2010, the claimants contended, inter alia, as follows.
On various occasions from around 2003, the claimants entered into a series of joint venture agreements with Ms Al Amoudi and Mr Nichol or one or other of them for the development of properties in central London. Under the terms of these joint venture agreements, the claimants would provide the know-how, experience and contacts necessary to locate and acquire the suitable properties and carry out any necessary refurbishment; Ms Al Amoudi, Mr Nichol and the claimants would secure the necessary finance; and upon realisation of a joint venture, the profits derived from it would be divided equally between, on the one hand, the claimants and, on the other hand, Ms Al Amoudi and Mr Nichol.
One such joint venture agreement concerned a large development in Hans Place ("the Hans Place JVA"). Another concerned the development at 66 Pont Street, that is to say, the Pont Street JVA.
Yet others concerned the developments to which I have referred at:
i) Herbert Crescent, SW1;
ii) 19 Basil Street, SW3;
iii) 50 Cadogan Square, SW1; and
iv) 8 Walton Place, SW3.
Moreover, in their further information dated 20 May 2011, the claimants asserted that the joint ventures the subject of the claim incorporated the terms agreed between the claimants and Mr Nichol at the Oriel restaurant in September 2005, that is to say the Oriel Agreement.
The claimants continued that, pursuant to one or more of these joint venture agreements, they transferred to Ms Al Amoudi in 2007 various sums of money amounting to around £2.3 million by way of funding for various properties and a sum of around £800,000 for the purpose of refurbishing various properties. The claimants maintained that all of these monies or their proceeds were held on trust for the claimants and they were therefore entitled to the return of the monies or a declaration that they had a beneficial interest in any properties in relation to which they had been applied.
In addition, asserted the claimants, in order to give effect to the Hans Place JVA and in reliance upon various representations made by Ms Al Amoudi, the claimants transferred six properties ("the Security Properties") to Ms Al Amoudi at less than their true value. These representations were false and accordingly the claimants were entitled to rescind the Hans Place JVA and the transactions...
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