Blacklion Law LLP v Amira Nature Foods Ltd
| Jurisdiction | England & Wales |
| Judge | Paul Matthews |
| Judgment Date | 20 June 2022 |
| Neutral Citation | [2022] EWHC 1500 (Ch) |
| Docket Number | Case No: BL-2018-000862 |
| Court | Chancery Division |
[2022] EWHC 1500 (Ch)
HHJ Paul Matthews
(sitting as a Judge of the High Court)
Case No: BL-2018-000862
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
BUSINESS LIST (ChD)
Royal Courts of Justice
Rolls Building, Fetter Lane,
London, EC4A 1NL
Sebastian Kokelaar (instructed by Richard Slade & Co) for the Claimant
Anthony Jones (instructed by Clyde & Co LLP) for the Defendants
Hearing dates: 23–26 May 2022
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.
This judgment will be handed down by the Judge remotely by circulation to the parties' representatives by email and release to The National Archives. The date and time for hand-down is deemed to be 10:30 am on Monday 20 June 2022.
Introduction
This is my judgment on the trial of a claim brought by a claim form issued under CPR Part 7 on 17 April 2018. It is essentially a claim by a law firm against its former client for breach of contract in respect of two contracts of retainer entered into by the parties. The two retainer agreements were entered into in writing, and are dated 2 November 2016 and 3 May 2017 respectively. The first of these was a general retainer. For reasons given below, the claim in relation to this retainer is no longer live. The second retainer was in connection with a finance transaction, a proposed bond issue. This was known as Project Avatar. Although a great deal of work was done in preparation for this bond issue, it never completed. The dispute in relation to this retainer is what was before me at the trial, and is the subject of this judgment.
The primary issue arising out of the Avatar retainer is one of construction, and, in particular, whether the payment obligation was conditional on the bond issue completing. But, if the claimant's case on construction fails, there is an alternative claim for rectification of the contract of retainer. Thirdly, if the claimant establishes a breach of contract by the first defendant, there is a further question as to the possible liability of the second defendant towards the claimant for procuring that breach of contract. This creates some difficulty in considering the evidence and finding the facts on which these issues must be decided. I will return to this issue shortly. Finally, there is also a point about contractual interest on any debt found due. At an earlier stage, there were also arguments advanced about estoppel, but these were not pursued at trial.
Procedure
As I have said, the claim was commenced on 17 April 2018. A defence and counterclaim were served on 16 April 2020. A reply and defence to counterclaim were served on 22 April 2020. This for the first time raised a claim for rectification of the agreement if the claimant's construction argument failed. In August 2020 the defendants discontinued the counterclaim. Subsequently (in March 2022), the claim form and particulars of claim were amended to reflect the alternative claim for rectification. However, the defendants have not served any amended defence in response.
I should just say this about the claim under the general retainer. On 8 October 2020 the claimant applied for summary judgment in relation to the claims under both retainers. On 15 February 2021, Deputy Master Nurse gave summary judgment to the claimant on the claim under the general retainer, for a sum to be assessed, but dismissed the application so far as it related to the Avatar retainer. On 8 April 2022, Costs Judge Leonard assessed the sum due to the claimant as £65,000, together with £83,000 interest, making a total of £148,000, together with an award of costs of the assessment in the sum of £37,000. All of these sums were made payable by 28 April 2022. I have been told that none of them has been paid so far.
Applications at trial
At the outset of the trial there were two applications made to me. The first was for relief from sanction in relation to the witness statement of Simon Maxwell Ziff, dated 19 April 2022 and filed and served on the following day, although the deadline for exchange of written statements had been 21 March 2022. After hearing counsel on this matter, and for reasons then given, I gave relief from sanction and permission to rely upon that witness statement and call Mr Ziff to give oral evidence in the trial. In brief, those reasons were that, applying the well-known Denton criteria, it was overall in the interests of justice to admit the further evidence.
The second application was for the second defendant to give his oral evidence remotely by video link from California where, as I understand it, he had gone for the purposes of his children's graduation ceremonies and also for business appointments. After hearing counsel, I refused this application for reasons then given. In summary, these were that the second defendant (i) had known of the seven day trial window since last November, and of the dates of the trial once fixed within that window since before 13 May, but had not raised any question of being out of the jurisdiction until last Friday, (ii) could only be available (even remotely) after 3 pm on the last day of trial, and (iii) was relying on non-compelling reasons for being abroad. In addition, given that the second defendant and Ms Yazdani gave differing accounts of the negotiations between them, I would have to pay particular attention to their evidence. I would be put in an invidious position if I had to compare the evidence of one in court with the other by videolink.
Witnesses and evidence
Live witnesses
I heard evidence from the following witnesses: Simon Maxwell Ziff, Carolina Gonzalez-Salazar, Trevor Ingram and Negar Yazdani (for the claimant), and Miriam Nasralla (for the defendants). I give here my impressions of these witnesses. Mr Ziff was highly professional and fluent witness, transparently honest and seeking to assist the court. Cross-examination made no impression on him. I accept his evidence as truthful. Ms Gonzalez-Salazar was an equally straightforward and honest witness, and I accept her evidence as truthful. But it is fair to say that her evidence was more marginal than that of other witnesses from whom I heard. Mr Ingram was a professional, knowledgeable and fluent witness. I accept his evidence as truthful. Ms Yazdani was a clear, fluent and helpful witness. Cross-examination made no significant impact upon her. She came across as a professional but rather a cautious person. I accept her evidence as truthful. Ms Nasralla was a very quick and fluent witness, whose intelligence was immediately apparent. On the whole, I was satisfied that she was telling me the truth, although her absolute loyalty to the second defendant was readily apparent in her answers, and on one important point I am unable to accept her evidence at face value.
Brenda Hamilton
I was also pressed with statements from two witnesses who did not attend the trial. Two of these statements were from Brenda Hamilton, a US lawyer who represented the defendants in the USA. Her two witness statements were not made for trial, but instead in relation to the summary judgment application to which I have already referred. For the purposes of the trial, they were made the subject of a notice under the Civil Evidence Act 1995, section 2, and CPR rule 33.2. However, on 5 April 2022 Deputy Master Nurse ordered that the defendants make provision for Ms Hamilton to attend the court either in person or by videolink between 7 and 10 May 2022 to be cross-examined on her witness statements. It is clear from the correspondence that the defendants' solicitors wrote on two occasions to Ms Hamilton to inform her of the order of the court, but received no reply. She has not attended at the trial, nor indeed communicated with the court, and so I have not seen or heard her.
Given that Ms Hamilton is not a party to the proceedings, and is not subject to the jurisdiction of the court, and so cannot be compelled to make herself available for cross-examination, the claimant did not seek to exclude her written evidence altogether. Instead, it said it would be content to make submissions in due course as to the weight which might be placed upon it and as to any inference that might be drawn against the defendants by reason of her not being called. As to that, there is first the obvious point that these witness statements were directed at defeating the application for summary judgment, rather than at giving the evidence which would be given in chief at trial. There is then the (equally obvious) second point that, unlike witnesses tendered for cross-examination at trial, her evidence is not given on oath, I have not been able to observe her demeanour, and there has been no testing of her evidence by cross-examination. All this must mean that it is of less weight than evidence given in court at trial. I accept these submissions.
Thirdly, there is the refusal of Ms Hamilton to engage with the defendants' solicitors or to contact the court in relation to the order of Deputy Master Nurse. There is also the further failure to give any explanation, let alone a good explanation, for not doing so. The claimant submits that the court should draw an inference that the witness is unwilling to be cross-examined on her evidence because she knows it is untrue, and this must deprive the evidence of any weight. I am not so sure about this. There is a well-known line of authorities explaining that the court may draw an inference adverse to a party where it fails without good explanation to call a witness who could be expected to give relevant evidence: see Royal Mail Group Ltd v...
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Blacklion Law LLP v Amira Nature Foods Ltd and Another
...OF JUSTICE BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES His Honour Judge Paul Matthews (sitting as a Judge of the High Court) [2022] EWHC 1500 (Ch) Royal Courts of Justice Strand, London, WC2A 2LL John Russell KC (instructed by Bower Cotton Hamilton LLP) for the Sebastian Kokelaar (ins......