AWG Group Ltd v Morrison
| Jurisdiction | England & Wales |
| Judge | Mr. Justice Evans-Lombe |
| Judgment Date | 01 December 2005 |
| Neutral Citation | [2005] EWHC 2786 (Ch) |
| Court | Chancery Division |
| Docket Number | Case No: HC03C00478 |
| Date | 01 December 2005 |
[2005] EWHC 2786 (Ch)
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr. Justice Evans-Lombe
Case No: HC03C00478
Charles Aldous QC, Charles Bèar QC, Dominic O'Sullivan (instructed by Herbert Smith) for the Claimants
Lawrence Cohen QC, Amanda Harrington (instructed by Decherts) for the 1 st Defendant
Philip Marshall QC, Deepak Nambidan (instructed by Oswlangs) for the 2 nd Defendant
Hearing date: 30/11/2005
Approved Judgment
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
Mr Justice Evans-Lombe
I have to deal with an application made by the defendants Sir Alexander Fraser Morrison ("FM") the 1 st defendant and Stephen John McBrierty ("SM") the 2 nd Defendant, made on Wednesday the 30 th November the week immediately preceding the intended commencement of the trial on the 5 th December, that I should recuse myself from trying the case. The application arises in this way: in the course of my pre-reading into the case I noticed that it was intended to call as a witness for AWG Group Ltd ("AWG") Mr Richard Jewson ("Mr Jewson") who, at all material times until March 2002 was a director of AWG and chairman of the audit sub-committee of its board. Alerted by the name I then discovered that Mr Jewson is well known to me of which fact I in turn alerted the parties on the 29 th November. The response of the claimants was to indicate that, rather than risk my withdrawal and the consequent delay in obtaining another judge and his completing the pre-reading process on which I have already spent a week, they would not call him to give evidence since they did not regard him as other than a relatively peripheral witness. The response of the defendants is contained in a letter from Messrs Dechert LLP of the 30 th November the conclusion of which was to ask me to withdraw.
The case arises from the take-over by AWG of Morrison plc ("Morrison") in which FM and SM were respectively the chairman, and in effect, the chief executive officer. They also held between them a substantial proportion of AWG's shares. In August 2000 AWG made an approach to Morrison with a view to bidding for the whole of the issued share capital of that company. In due course a bid was made which AWG declared to have gone unconditional on the 21 st September 2000. It is AWGs' case that it was procured to make the bid and to declare it unconditional as a result of a representation that Morrison's profits in the full year to March 2001 would be £30.5m, that that representation was made to the board of AWG by the defendants at a time when they had no bona fide belief that such a level of profit would be achieved, and that, in making the representation, the defendants fraudulently procured Morrison to conceal from AWGs' "due diligence" inquiries, material facts from which AWG might well have concluded that that level of profit was unachievable and that they should withdraw their bid.
At the outset of the hearing of the defendant's application I described my connection with AWG and with Mr Jewson in the following terms: AWG is a company whose primary business is supplying water to industry and the public in East Anglia and in particular in Norfolk. My family are farmer/landowners in Norfolk and so in the area of operation of AWG. I have had dealings with AWG, not always harmonious, over the years on such subjects as access for the purpose of sinking boreholes and running pipelines. Mr Jewson lives in the next village to the village where I and my family live being approximately 1 mile distant. Our families have known each other for at least 30 years. Our children are friends and we have dined with each other on a number of occasions. Mr Jewson and I in the past were tennis partners. Mr Jewson has recently been appointed Lord Lieutenant of Norfolk. I would have the greatest difficulty in dealing with a case in which Mr Jewson was a witness where a challenge was to be made as to the truthfulness of his evidence.
As is apparent the case which the claimants seek to make out against the defendants involves serious allegations against prominent businessmen for whom, if those allegations are found proved, most serious consequences would follow both in the damages which they might be required to pay and in the consequences that such findings would have for their future careers.
In the judgment of the Court of Appeal in Locabail (UK) Ltd v Bayfield Properties Ltd [2000] QB 451 to which the then Lord Chief Justice The Master of the Rolls and the Vice Chancellor contributed the following passage appears at paragraph 25 where, having set out a number of circumstances where the court could not conceive that objection could properly be made the court went on to say:—
"By contrast, a real danger of bias might well be thought to arise if there were personal friendship or animosity between the judge and any member of the public involved in the case; or if the judge were closely acquainted with any member of the public involved in the case, particularly if the credibility of that individual could be significant in the decision of the case…."
In Taylor v Lawrence [2002] 3 WLR 640 at paragraph 60 the Court of Appeal having cited decisions of the House of Lords including the Locabail case said this:—
"…the...
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