Amanda Wade and Nicholas Nicholson (Joint Liquidators of MSD Cash and Carry Plc ((in Liquidation))) v Mohinder Singh

Hearing dates: 16, 17, 18 April 2024

Draft judgment circulated: 20 May 2024

Remote hand-down: This judgment was handed down remotely at 10.30am on 24 May 2024 by circulation to the parties or their representatives by email and by release to The National Archives.

Deputy ICC Judge Curl KC:

This is my judgment following the trial of proceedings to enforce charging orders over a number of properties owned by the Defendants. The Claimants are the liquidators of MSD Cash & Carry plc ( “Company”). An order was made to wind up the Company on 16 January 2012 on a petition presented on 12 September 2011. David Ingram was appointed liquidator of the Company on 27 January 2012. Mr Ingram was replaced as liquidator by Amanda Wade and Nicholas Nicholson ( “Liquidators”) on 1 December 2023.

The Defendants are members of the same family. They have been referred to throughout the proceedings by their first names and I will continue to do that in this judgment, with no disrespect intended thereby. The first, second and third defendants are, respectively, Mohinder Singh ( “Mohinder”), Surjit Singh Deol ( “Surjit”) and Raminder Kaur Deol ( “Raminder”). Mohinder is the father of Surjit, and Raminder is married to Surjit. On the first day of trial, the estate of Bakshish Kaur ( “Bakshish”), who died on 17 July 2023, was added as the fourth defendant in circumstances described below. Bakshish was the late wife of Mohinder, and the mother of Surjit. Other family members mentioned in this judgment are Kuldip Kaur Basi ( “Kuldip”) and Baljit Kaur Kuman ( “Baljit”), who are daughters of Mohinder and Bakshish, and Surjit's sisters.

These proceedings were issued against Mohinder, Surjit and Raminder by Mr Ingram under Part 8 of the CPR on 14 June 2022 ( “Part 8 Claim”). The Part 8 Claim sought to enforce a series of charging orders that secured a judgment debt of £996,494.61 owed to Mr Ingram by Mohinder and Surjit. That debt arose from misfeasance proceedings brought against them (and against Kuldip, Baljit and a connected company called Dale Wholesale Limited) in the liquidation of the Company. Following a trial ( [2018] EWHC 1325 (Ch)), His Honour Judge Hodge QC (sitting as a deputy High Court judge) inter alia directed on 4 May 2018 that an inquiry take place into the loss suffered by the Company. That inquiry took place before Judge Jonathan Richards (as he then was, sitting as a deputy High Court judge) on 9 March 2021 ( [2021] EWHC 639 (Ch)), following which judgment was entered on 14 April 2021 against Mohinder and Surjit for £996,494.61, together with interest at 4.75 per cent per annum from 5 November 2011 in the sum of £445,988.04 and continuing at the judgment rate thereafter.

The Part 8 Claim sought to enforce by way of an order for sale charges held over a number of properties, as follows:

i) The Oaks, Boxley, Maidstone ( “the Oaks”): this is a residential property to which Mohinder and Raminder hold joint legal title. It comprises seven separate registered titles. At the time that the Part 8 Claim was issued, Mr Ingram held charging orders over only five of them (K263957, K274536, K548311, K695398 and K748779), and only those five were particularised in the Part 8 Claim.

ii) 37 Barleymow Close, Chatham ( “37 Barleymow Close”): this is a residential property to which Mohinder and Surjit hold joint legal title. Mohinder resides there.

iii) 152 Dale Street, Chatham ( “152 Dale Street”): this is a tenanted residential property to which Mohinder holds sole legal title.

iv) 104 Dale Street, Chatham ( “104 Dale Street”): this is a tenanted residential property to which Mohinder holds sole legal title (152 Dale Street and 104 Dale Street together “Dale Street Properties”).

A number of witness statements in opposition to the Part 8 Claim were served. First, statements were provided by Onofrio Sanfilippo (26 August 2022) and Ralph de Souza (1 September 2022), both of Leigh Carr Chartered Accountants, whose firm had acted for members of the Defendants' family and associated companies for some years. Soon afterwards, statements dated 9 September 2022 were served for Mohinder, Bakshish, Surjit and Raminder. The statements served for Mohinder and Bakshish were the subject of applications on the first day of trial. For present purposes, three key points of significance were raised in this round of evidence. Firstly, it was asserted that Raminder was the sole beneficial owner of the Oaks, in support of which a three-page document headed “Declaration of Trust” and bearing the date 17 April 2017 ( “Declaration”) was disclosed as an exhibit to Raminder's statement. Secondly, Raminder drew attention to the fact that the Declaration covered the seven title numbers comprising the Oaks and that the Part 8 Claim had been brought only in respect of five of them, with no claim brought in relation to title numbers K493509 and K500566. Thirdly, Bakshish asserted that she was a joint beneficial owner (with Mohinder, her husband) of 37 Barleymow Close and the Dale Street Properties.

As a consequence of the disclosure of the Declaration, Mr Ingram issued a claim on 25 October 2022 under Part 7 of the CPR ( “Part 7 Claim”). The Part 7 Claim alleged that the Declaration was either a sham or, alternatively, was a transaction defrauding creditors within the meaning of s.423 of the Insolvency Act 1986 ( “IA 1986”). As issued, the Part 7 Claim was brought against Mohinder, Surjit and Raminder, although it was discontinued against Surjit once it became clear that he repudiated any beneficial interest in 37 Barleymow Close, despite his holding joint legal title to it.

On 27 October 2022, Deputy Master Teverson ordered that the Part 7 Claim should be transferred to the Insolvency and Companies List and consolidated with the Part 8 Claim. Particulars of Claim were filed dated 8 November 2022 ( “Particulars of Claim”). A defence was filed on behalf of Mohinder and Raminder dated 6 December 2022 ( “Defence”).

No action was taken by either side to engage with the consequences of Bakshish (a non-party to the proceedings) having asserted a beneficial interest in 37 Barleymow Close and the Dale Street Properties until the Defendants' newly-instructed solicitors raised the point, apparently for the first time, by a letter dated 10 April 2024.

Preliminary matters

A number of applications were made shortly before trial. I summarise these as briefly as possible, together with a number of other preliminary matters, under this heading.

As mentioned at §4 above, at the time the Part 8 Claim was issued, Mr Ingram held charges over only five of the seven titles comprising the Oaks. Matters rested there until 20 March 2024, when applications for charging orders were made in relation to the two missing titles, being K493509 and K500566. Interim charging orders were made by Deputy ICC Judge Agnello KC on 21 March 2024. At the request of the Liquidators, the hearing of the application to make those orders final was relisted to be heard at the same time as the trial before me, although draft final charging orders were not available at the start of the trial. I ultimately made the two charging orders final on 18 April 2024, the third day of trial.

The Defendants applied on 10 April 2024 for permission to admit witness statements of Daniel Andrews dated 8 April 2024, Raminder dated 9 April 2024 ( “Raminder 3”), and Baljit and Kuldip both dated 10 April 2024. Further applications had been filed by the Defendants (but not yet issued) to admit the first and second witness statements of Sanjay Panesar (the Defendants' former solicitor) made on 11 and 15 April 2024. These statements were all long out of time, as the extended date for service of the Defendants' witness evidence was 15 August 2023. By the commencement of trial, only the admission of Raminder 3 was resisted by the Liquidators. It was common ground between the parties that the Defendants required relief from the sanction imposed by CPR 32.10 and that the three-stage test in Denton v TH White Ltd [2014] 1 WLR 3926 applied.

The Liquidators applied on 12 April 2024 for:

i) an order under CPR 19 r.12(2)(b) for the addition of the estate of Bakshish Kaur (deceased) ( “Estate”) as the fourth defendant and the appointment of a representative of the Estate; and

ii) permission to amend the claim form served in the Part 8 Claim dated 14 June 2022 to add the two further title numbers (K493509 and K500566) to the claim for an order for sale in relation to the Oaks and to make clear that each head of relief was sought under ss.14 and 15 of the Trusts of Land and Appointment of Trustees Act 1996 ( “ TOLATA”), by reason of the subject properties all being co-owned or allegedly co-owned.

No request to amend the claim form issued in the Part 7 Claim or the Particulars of Claim in support was included in the Liquidators' issued application and an informal application for such relief was added during oral submissions.

As to the first part of the Liquidators' application, there was no opposition to the joinder of the Estate but Mr Grant KC raised a number of practical difficulties that flowed from that in relation to the Dale Street Properties. These included the fact that the Estate did not...