Associated Newspapers Ltd v Duncan Walker Bannatyne and Others
| Jurisdiction | England & Wales |
| Judge | Judge Hodge |
| Judgment Date | 16 November 2015 |
| Neutral Citation | [2015] EWHC 3467 (Ch) |
| Court | Chancery Division |
| Docket Number | No. 2403 of 2015 |
| Date | 16 November 2015 |
[2015] EWHC 3467 (Ch)
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
MANCHESTER DISTRICT REGISTRY
Manchester Civil Justice Centre
1 Bridge Street West
Manchester M60 9DJ
His Honour Judge Hodge QC
(Sitting as a Judge of the High Court)
(In Private)
No. 2403 of 2015
Mr. Adam Wolanski (instructed by Reynolds Porter Chamberlain LLP) appeared on behalf of the Applicant.
Mr. Julian Wilson (instructed by Ward Hadaway) appeared on behalf of the Respondents.
Judge Hodge QC:
This is my extemporary judgment in two related sets of proceedings concerning the affairs of Bannatyne Fitness Ltd. The first in point of time is a petition under Part 30 of the Companies Act 2006 brought by Mr. Graham Nigel Armstrong under petition number 2403 of 2015 against, as the proceedings are now constituted, Mr. Duncan Walker Bannatyne, Mr. Justin Musgrove and Bannatyne Fitness Ltd. That petition was presented to the court on 16 th April 2015 and effectively seeks a declaration that the company's affairs have been conducted in a manner unfairly prejudicial to the interests of the members generally, or some part of its members (including Mr. Armstrong), for an order that the respondents (or the company) purchase Mr. Armstrong's shares in the company, and, finally, for an order that Mr. Armstrong be permitted to bring his complaints in the form of derivative proceedings.
Those proceedings were the subject of a case management order made by District Judge Bever on 7 th September 2015, when the petition was ordered to stand as points of claim and directions were given for the service of points of defence.
The second set of proceedings is a Part 7 claim brought by Mr. Armstrong against Bannatyne Fitness Ltd. and Mr. Bannatyne for damages for wrongful dismissal. That claim was issued on 4 th September 2015 and it has been ordered to be case managed with the Part 30 petition. Mr. Armstrong was the former Chief Executive Officer of Bannatyne Fitness Ltd.
On 21 st September 2015 Associated Newspapers Ltd. issued an application notice seeking orders pursuant to rule 7.31A (6) and (9) of the Insolvency Rules permitting it to inspect documents contained in the court file, particularly the particulars of claim and the defence. That application came before His Honour Judge Bird, sitting as a Judge of the High Court, on paper and he ordered that it should be served on the petitioner and all of the respondents to the petition. A hearing was to be listed before Judge Bird on 25 th September where the court was said to be likely to treat the application as referring to points of claim and points of defence rather than particulars of claim and defence and might, at the hearing, treat the application as one made under CPR 5.4C in the event that the relevant documents did not form part of the file referred to in the relevant Insolvency Rule.
The matter came before Judge Bird on 25 th September when various undertakings were given which enabled named individuals associated with the applicant, Associated Newspapers Ltd., to consider the terms of the particulars of claim and points of claim, subject to suitable undertakings as to keeping those contents confidential and to not making any use of them. On that basis, the application was adjourned to a further hearing which was ordered to take place in private and which, in the event (and after the vacation of an intervening hearing date), has come on for hearing before me today.
The only evidence before the court is that contained in the original application notice, together with a short witness statement from Mr. Martin Wood, a lawyer working in the Legal Department of Associated Newspapers Ltd., made on or about 23 rd September 2015. On this application the applicant, Associated Newspapers Ltd., is represented by Mr. Adam Wolanski (of counsel). The effective respondents, Mr. Bannatyne and Bannatyne Fitness Ltd., are represented by Mr. Julian Wilson (also of counsel).
There is present in court Mr. Armstrong. His solicitors, Shulmans LLP, wrote in to the court on 12 th November 2015 making it clear that Mr. Armstrong does not oppose the application for Associated Newspapers Ltd. to have access to the statements of case on the court file and is neutral in relation to their having access to further documents. The letter made it clear that Mr. Armstrong would not be represented at today's hearing but would be attending in the capacity of an observer, which he has done (together with his father).
Both Mr. Wolanski and, more recently, Mr. Wilson have filed written skeleton arguments with the court, although I did not have the opportunity of reading through Mr. Wilson's skeleton until the beginning of the present hearing. The application bundle only reached me just before 10 minutes past 10.00 this morning for the hearing listed at 10.30.
Although in form this is an application by Associated Newspapers Ltd. for access to documents on the court file, in fact it is accepted that the real matter before the court is an application, which has never been formulated in writing, by the respondents to redact certain parts of the statements of case on the court file. It is accepted that since these are not proceedings governed by the Insolvency Rules, those rules have no application and that the applicable rule is that contained in CPR 5.4C. By sub-rule (1):
"The general rule is that a person who is not a party to proceedings may obtain from the court records a copy of –
(a) a statement of case, but not any documents filed with or attached to the statement of case, or intended by the party whose statement it is to be served with it;
(b) a judgment or order given or made in public …".
By CPR 5.4C (4):
"The court may, on the application of a party …
(c) order that persons or classes of persons may only obtain a copy of a statement of case if it is edited in accordance with the directions of the court."
That is the relief which is sought by Mr. Bannatyne and Bannatyne Fitness Ltd. in the present case. By CPR 5.4C (5):
"A person wishing to apply for an order under paragraph (4) must file an application notice in accordance with Part 23."
That has not been done but it is accepted that I should treat the matter as though such an application were before the court.
Since this is, therefore, effectively Mr. Wilson's application, it was he who opened the application and addressed me for about an hour and a quarter. Mr. Wolanski then replied for about an hour and 5 minutes; and Mr. Wilson then responded for about 15 minutes. At about 1.25 the court adjourned until 2.15 for me to deliver this extemporary judgment.
The nature of the redactions sought by Mr. Wilson has been reduced since the time he prepared his written skeleton argument. What is now sought is the redaction of certain passages at paras. 46, 48, 49, 50, 54.2, 56, 77, 79–82 and 87 of the points of claim in the unfair prejudice proceedings. Similar passages are sought to be redacted in the particulars of claim in the Part 7 claim. Mr. Wilson did not have time to go through the particular redactions sought in that latter statement of case, nor did he have the time to go through the redactions sought in the defences and counterclaims of Mr. Bannatyne, but I have no doubt that once I have delivered a judgment dealing with the principle of the matter, it should prove possible for the parties' legal representatives to agree upon any redactions that may follow from the terms of this judgment. If there is any difficulty in that regard, then further application can be made to the court to give effect to the terms of this extemporary judgment.
Mr. Wilson explained that the background to the application is a particularly fraught divorce between Mr. Bannatyne and his former wife, to whom, in order to preserve such anonymity as may still attach to her, I will refer as "Mrs. Bannatyne", although that is no longer the name by which she is known. In the course of the financial remedy proceedings forming part of that divorce, Mr. Bannatyne produced a Form E, which is the means by which financial disclosure of his financial assets and resources is made. He attached to that a copy of a contingency agreement which created certain contingent obligations on the part of Bannatyne Fitness Ltd. towards Mr. Armstrong and under which Mr. Armstrong was to be entitled to a financial settlement in certain circumstances. That written contingency agreement produced by Mr. Bannatyne was dated 25 th January 2010 and was accompanied by a supporting minute of the board of Bannatyne Fitness Ltd. bearing the same date. Mr. Bannatyne, and also Mr. Armstrong, each made witness statements in which they referred to the contingency agreement as having been made in January 2010. Subsequently, both Mr. Bannatyne and Mr. Armstrong each made corrective witness statements. In the case of Mr. Bannatyne, it was his fourth witness statement, in which he disclosed that, whilst terms had originally been agreed orally between Mr. Armstrong and Bannatyne Fitness Ltd. in January 2010, those terms had not been reduced to writing until September 2011, and that the contingency agreement had then been recorded in terms which related to an increased financial settlement to Mr. Armstrong in the event that the contingency agreement failed to be implemented. It was also disclosed that the board minutes had actually related to a board meeting held, not in January 2010, but on 9 th September 2011. Mr. Bannatyne's fourth witness...
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