Brinks Ltd v Abu-Saleh [ChD]
| Jurisdiction | England & Wales |
| Judge | Rimer J. |
| Judgment Date | 10 October 1995 |
| Court | Chancery Division |
| Date | 10 October 1995 |
Chancery Division
Rimer J.
Michael Tugendhat QC, Richard Parkes, Richard Spearman and David Parsons (instructed by Shaw & Croft) for the plaintiffs.
Timothy Sisley and Aviva le Prevost (instructed by Goldkorn Davies Mathias) for Ann Elscombe, the thirteenth defendant.
The following cases were referred to in the judgment:
Agip (Africa) Ltd v JacksonELR [1990] Ch 265; [1991] Ch 547.
Baden v Societe Generate pour Favoriser le Developpement du Commerce et de I'Industrie en France SAWLR [1993] 1 WLR 509.
Barnes v AddyELR (1874) LR 9 Ch App 244.
Eagle Trust plc v SBC Securities LtdWLR [1993] 1 WLR 484.
Kronprinz, TheELR (1887) 12 App Cas 256.
Polly Peck International plc v Nadir (No. 2)UNK [1992] 4 All ER 769.
Royal Brunei Airlines Sdn Bhd v Tan Kok MingELR [1995] 2 AC 378; [1995] BCC 899.
Trust — Breach of trust — Accessory to breach of trust — Tracing claim to recover proceeds of sale of robbery — Breach of fiduciary duty by security guard in participating in robbery — Stolen gold disposed of — Proceeds of sale laundered — Husband of defendant settled claim against him — Whether defendant liable as accessory to breach of trust.
This was an application by the thirteenth defendant for an action to be dismissed and for compensation under a cross-undertaking in damages given by the plaintiffs on the obtaining of a Mareva injunction against the defendant.
On 26 November 1983 gold and valuables worth £26m were stolen from the plaintiffs' warehouse. A number of arrests and prosecutions followed. A security guard employed by the plaintiffs took part in the robbery. He pleaded guilty to robbery with violence and gave evidence against others. The gold was not recovered. It was smelted and disposed of and the proceeds of sale laundered. Prosecutions were brought against a number of accused for handling stolen goods and laundering offences. Some, including Parry, were convicted. Mr and Mrs £ were acquitted, Mrs £ on the basis that she had no case to answer.
The plaintiffs brought civil proceedings against 57 defendants to recover their stolen property or damages. Many of the claims were settled or sued to summary judgment. The remaining claims went to trial. The claim against Mr £ was settled on the first day of the hearing. Mrs E refused a settlement, seeking an order that the action against her be dismissed and compensation under the cross-undertaking in damages given by the plaintiffs on the obtaining of a Mareva injunction against her.
The plaintiffs alleged that Mrs E assisted her husband in the part he played in laundering some of the proceeds of the stolen gold by carrying £3m for Parry in cash from England to Switzerland by car. Mr E's reward was £30,000 plus expenses. It was the plaintiffs' case that as the gold was stolen from them with the assistance of a dishonest fiduciary, their security guard, the plaintiffs had an equity to trace into the proceeds which were in the nature of trust moneys. They claimed that Mrs E knew that she was involved in a dishonest conspiracy, which was sufficient for them to be entitled to recover. Mrs E denied all the allegations against her, maintaining that she believed her husband was assisting in tax evasion. She contended that the plaintiffs' settlement of their action with Mr E prevented them from pursuing their claims against her.
Held, dismissing the actions against Mrs E:
1. The plaintiffs' settlement with her husband did not operate to release Mrs E from liability in tort as: an accessory to the breach of trust, since the settlement discontinued the claims but did not release, discharge or extinguish the plaintiffs' cause of action against Mr E.
2. It was not only officers or directing minds of a company who were capable of committing breaches of fiduciary duty which constituted knowing assistance in a dishonest and fraudulent breach of trust. A security guard was employed by the plaintiffs in an important position of trust, and possessed valuable information relating to the security arrangements affecting property in the plaintiffs' custody. He owed the plaintiffs a duty not to divulge that information to anyone not entitled to it. In breach of that duty the security guard disclosed material information to the robbers thereby giving them vital assistance which enabled them to commit the robbery. That breach of his fiduciary duty was sufficient to entitle the plaintiffs to trace the gold and its proceeds in equity. (Royal Brunei Airlines Sdn Bhd v Tan Kok MingELR[1995] 2 AC 378; [1995] BCC 899 applied.)
3. There was no evidence that Mrs E provided assistance of a nature sufficient to make her an accessory to the breach of trust of which the plaintiffs complained. In order to be liable the plaintiffs had to prove that Mrs E both knew of and assented to the supposed tax evasion plan and joined in its execution. It was not sufficient that Mrs E knew the essence of what her husband was doing and acquiesced in it by accompanying him on several of the money laundering trips. Since that was all that had been established, it followed that the plaintiffs failed to show that Mrs E was accountable to them as an accessory to the breach of trust.
Rimer J:
The plaintiff is Brinks Ltd (“Brinks”), formerly known as Brink's-Mat Ltd. On 26 November 1983 it suffered a major robbery at its warehouse near Heathrow Airport. Gold and other valuables worth over £26m were stolen. Arrests and prosecutions followed. On 17 February 1984 Anthony Black pleaded guilty to a charge of robbery with violence and was sentenced to six years imprisonment. Mr Black was employed by Brinks as a security guard and had betrayed his employers by providing others involved in the robbery with a key to, and internal photographs of, the warehouse as well as information about its security arrangements and procedures, and by participating in the planning and execution of the robbery. He later gave evidence against those whom he alleged were also involved, Michael McAvoy, Brian Robinson and Anthony White. On 2 December 1984 Mr McAvoy and Mr Robinson were convicted of robbery with violence and were each sentenced to 25 years” imprisonment. Mr White was acquitted.
The gold was not recovered. It was smelted together with other base metals and sold. Prosecutions were brought against various individuals in connection with this operation. On 24 July 1986 Kenneth Noye (“Mr Noye”), Brian Reader and Garth Chappell were each found guilty on charges of conspiracy to handle the stolen gold.
The sale proceeds were the subject of laundering operations. Prosecutions were brought in 1988 against a number of individuals alleged to have been involved. They included Michael Relton (“Mr Relton”), who was found guilty on 7 July 1988 on a charge of conspiracy to handle stolen goods; and John Elcombe and his wife, Ann Elcombe. Mr Elcombe was acquitted by the jury after he had given evidence. Mrs Elcombe was acquitted on the basis that she had no case to answer. Similar charges were brought in 1992 against a number of other defendants. They included Gordon John Parry (“Mr Parry”), who was found guilty on 17 August 1992 on ten counts of handling stolen goods. His involvement was at the heart of the 1988 trials, but he could not be tried then as he was in Spain. It is also at the heart of this action. They also included Brian Perry (“Mr Perry”), who was found guilty of conspiracy to handle stolen goods.
Brinks brought civil proceedings against 57 defendants aimed at recovering their stolen property or damages in respect of their loss. Many of the claims were settled or sued to summary judgment. The trials of those claims which remained alive commenced before me on 25 April 1995.
Two of the defendants against whom the claims were so alive are Mr and Mrs Elcombe. However, the claim against Mr Elcombe was settled on the first day of the trials on terms which I should mention, since they are of relevance to one of the, issues which I have to decide: Brinks were to have leave to discontinue their action against him; a Mareva injunction granted on 9 December 1986 was discharged, as was Brinks's cross-undertaking in damages; Mr Elcombe abandoned his claim to damages under that undertaking; and there was to be no order as to costs (save for a legal aid taxation of Mr Elcombe's costs), with all prior costs orders being discharged.
The claim against Mrs Elcombe was not settled. She is legally aided and Brinks recognise that she does not have sufficient assets to satisfy any judgment they might obtain against her. They were willing to discontinue against her on like terms as those on which they settled with Mr Elcombe but she would not agree to this. She wants to have the action dismissed and to pursue a claim for compensation under the cross-undertaking in damages given by Brinks on the obtaining of a Mareva injunction against her. The trial of Brinks's claim against Mrs Elcombe commenced on 21 June and concluded on 27 June 1995. Brinks were represented by Mr Tugendhat QC, Mr Parkes, Mr Spearman and Mr Parsons. Mrs Elcombe was represented by Mr Sisley and Miss le Prevost.
The case against Mrs Elcombe is that between August 1984 and February 1985 she assisted her husband in the part he played in laundering part of the proceeds of the stolen gold by carrying approximately £3m in cash for Mr Parry from England to Switzerland by car. Mr Elcombe's reward for doing this was a payment of £30,000 plus expenses. Brinks rely on Mr Parry's convictions as evidence that he committed various offences of handling stolen goods (see s. 11(2)(a) of the Civil Evidence Act 1968). They rely on the indictment against him and on the transcript of the summing up at his trial for identifying the facts on which the convictions were based. They say that it is an inevitable inference from these facts that the money which Mr Elcombe carried to...
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