Baroness Jacqueline Van Zuylen v Rodney Whiston-Dew
| Jurisdiction | England & Wales |
| Judge | Mr Nicholas Thompsell |
| Judgment Date | 04 August 2021 |
| Neutral Citation | [2021] EWHC 2219 (Ch) |
| Docket Number | Case No: BL-2019-001517 |
| Court | Chancery Division |
[2021] EWHC 2219 (Ch)
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
COMPANIES LIST
Rolls Building
Fetter Lane
London, EC4A 1NL
Mr Nicholas Thompsell
sitting as a Deputy Judge of the High Court
Case No: BL-2019-001517
Mr Derrick Dale QC and Mr Imran Benson (instructed by Lock & Marlborough Solicitors) for the Claimant
Mr John Davis, Solicitor-Advocate (instructed by Davis-Law Associates) for the Second Defendant
Hearing dates: 7 June – 11 June 2021
APPROVED JUDGMENT
| Heading | Starting Paragraph |
| 1. INTRODUCTION | 1 |
| 2. THE CIRCUMSTANCES OF THE TRIAL | 3 |
| (A) Representation at trial | 3 |
| (B) The absence of the First Defendant | 7 |
| (C) The First Defendant's petition for bankruptcy | 34 |
| 3. THE EVIDENCE | 47 |
| 4. THE FACTS | 54 |
| (A) The commencement of the relationship | 55 |
| (B) The transfer of the Claimant's money to Charles Whiting | 65 |
| (C) The first Azure Trust | 71 |
| (D) The second Azure Trust | 98 |
| (E) The investment of the property | 108 |
| (F) The Essex Land | 113 |
| (G) The transfer to Powells Law | 117 |
| (H) The transfer to Davis Law | 128 |
| (I) The use made of the solicitors' accounts | 131 |
| (J) Money paid and received by the Claimant | 145 |
| (k) The arrangements unwind | 158 |
| 5. THE CLAIMANT'S BASES OF CLAIM | 163 |
| (A) The overarching case | 163 |
| (B) Deceit | 170 |
| (C) Breach of Fiduciary Duty | 191 |
| (D) Breach of the general prohibition under the FSMA | 199 |
| (E) Breach of contract and rescission | 226 |
| (F) Restitution | 229 |
| (G) Breach of Trust | 230 |
| (H) Tracing into the Essex Land | 249 |
| 6. THE FIRST DEFENDANT'S DEFENCE | 281 |
| (A) That he acted properly and honestly | 282 |
| (B) That he is protected by GBT's corporate veil and the Azure Trust | 283 |
| (C) That the court has no jurisdiction | 294 |
| (C) Quantifying the loss: interest calculation | 310 |
| 7. REMEDIES | 295 |
| (A) The Claimant's substantiated claims | 295 |
| (B) The remedies available to the Claimant | 296 |
| (C) Quantifying the loss: account taken of the Relevant Charge | 300 |
| (D) Quantifying the loss: interest calculation | 310 |
| (E) What order should the Court make? | 322 |
INTRODUCTION
In 2011, the Claimant, Baroness Jacqueline Van Zuylen made a decision that she now deeply regrets. She entrusted over £2.1 million – effectively her entire fortune – to the stewardship of the First Defendant, Mr Rodney Whiston-Dew. Less than half of this money has been returned to her and, with one exception, she has little idea of what has happened to the rest of it. The exception is that some of it (in her submission) is currently represented by advances made on the security of identified land in Essex.
By means of this case she is now seeking to make recovery of her losses against the First Defendant and against the Second Defendant, a company incorporated in the Seychelles, now called GBT Global Limited, which I will refer to as “ GBT”. Since 12 April 2018, after the events giving rise to claims in this action, GBT has been separately owned and controlled by Mr John Davis. Prior to this GBT was within the ownership and control of the First Defendant and was the vehicle that he used for dealing with the monies entrusted by the Claimant.
THE CIRCUMSTANCES OF THE TRIAL
(A) Representation at trial
The Claimant has been represented in this action by Mr Derick Dale QC and Mr Imran Benson of counsel.
GBT has been represented by Mr John Davis, who is a solicitor-advocate as well as being the sole shareholder and director of GBT.
The First Defendant is a litigant in person. As a former solicitor and former member of the New Zealand Bar, he is better equipped than most people to represent himself. He has chosen, to the extent that he had a choice given his financial circumstances, not to be represented for this trial. How much choice his financial circumstances have afforded him is not known to the court – the court learned that he has filed for bankruptcy, but there has also been a suggestion that there may exist discretionary trusts and companies offshore from which he might benefit and these may or may not have provided a potential source of funding for representation.
The First Defendant did, however, arrange for Mr Timothy Becker of counsel to attend briefly at the start of the trial on his behalf. Mr Becker's role was limited to explaining the First Defendant's non-attendance and to informing the court that the First Defendant had filed a petition for bankruptcy very shortly before the commencement of the trial.
(B) The absence of the First Defendant
The First Defendant is currently in jail, having been convicted for his part in a fraudulent tax evasion scheme. His conviction was unrelated to the matters involved in this trial. It related to the dishonest formation and abuse of offshore companies and trusts. At his request, he has been permitted to participate in this trial by video link. However, he has chosen not to attend, citing as his reason that he is suffering from stress, anxiety and depression.
This is not the first time that the First Defendant has failed to attend a hearing in this matter. On various occasions during this litigation he has sought adjournments based on his personal difficulties.
This trial was due to take place on 15 March 2021 but was adjourned until 21 April 2021 at his request. He asked for this because of his difficulties in dealing with the bulk of paperwork involved following its late delivery owing to the document-screening procedures adopted by the prison where he is resident, and his lack of access to legal textbooks, and because of the stress this was causing him.
At the adjourned trial date on 21 April, the First Defendant did not attend but instead (via Mr Becker) asked the court to hear a very late and unmeritorious challenge to the court's jurisdiction and asked for a further adjournment based on the stress and anxiety that the trial was causing to him in the circumstances of his incarceration.
His claims concerning his mental health were supported by very weak medical evidence. Despite this, acknowledging the difficulties that he may have had in prison in arranging for a proper medical report, I gave him the benefit of the doubt and accepted a further adjournment until 7 July 2021.
I considered that appearing remotely from prison via a video screen might be more stressful than appearance in person. As a result, I also ordered a change to the arrangements previously ordered for a remote trial so that the trial would instead be held in court, and I made a production order requiring the prison to deliver the First Defendant for the trial.
I later received an application from the First Defendant requesting permission to attend the trial remotely on the grounds that he was continuing to experience stress, anxiety and depression and that he would find this less stressful than being transferred to a prison in London for the duration of the trial. This application was supported by a copy of part of a medical report.
This medical report also was not particularly satisfactory as evidence. It was not addressed to the court but had been produced for other purposes, and the court was given only part of the report and that part did not include any signature. Despite this, I was prepared to take account of it for the purposes of that application. I also considered that the First Defendant was the best person to decide what arrangements for his appearance he would find less stressful. Accordingly, I granted this request.
Although the First Defendant, through counsel, has explained that he has not attended this trial owing to the difficulties that he is continuing to face from depression, stress and anxiety, he has not on this occasion, requested any adjournment. Neither has he produced any medical evidence to support any proposition that he is unable to attend, even remotely from his prison. He did inform the court what types of drugs he had been prescribed but not the dosages and with no explanation as to the effect that they might have on him.
Under CPR rule 39.3, the court may proceed with the trial in the absence of a party.
In anticipation that the First Defendant might not attend (which he had indicated informally shortly before the trial via Mr Becker) and might request an adjournment, I had already reminded myself of the steps that a judge should consider where a party requests an adjournment having failed to attend citing medical reasons.
As Gibson LJ noted in Teinaz v London Borough of Wandsworth [2002] EWCA Civ 1040:
“Although an adjournment is a discretionary matter, some adjournments must be granted if not to do so is a denial of justice. Where the consequences of the refusal of an adjournment are severe, such as where it will lead to the dismissal of the proceedings, the tribunal or court must be particularly careful not to cause an injustice to the litigant seeking an adjournment.”
However,
“the tribunal or court is entitled to be satisfied that the inability of the litigant to be present is genuine, and the onus is on the applicant for an adjournment to prove the need for such an adjournment”.
No evidence was put before the court to substantiate the First Defendant's inability (as opposed to unwillingness) to attend this hearing. There was no suggestion that he lacks capacity within meaning of the Mental Capacity Act 2005 so as to engage considerations under CPR rule 21.1. On the contrary, it appears that the First Defendant had been able to take various steps to promote his own interests in this litigation....
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