Colm Gerard Corran (Petitioner) v Simon Victor Butters and Others
| Jurisdiction | England & Wales |
| Judge | His Honour Judge Stephen Davies |
| Judgment Date | 14 September 2017 |
| Neutral Citation | [2017] EWHC 2294 (Ch) |
| Docket Number | Case No: 2296 of 2016 |
| Court | Chancery Division |
| Date | 14 September 2017 |
[2017] EWHC 2294 (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 Stephen Davies
SITTING AS A JUDGE OF THE HIGH COURT
Case No: 2296 of 2016
Mr Giles Maynard-Connor (instructed by JMW Solicitors LLP, Manchester) for the Petitioner at trial but not on 14 September 2017, when the Petitioner was acting in person and did not appear
Mr Gregory Pipe (instructed by Rollits Solicitors LLP, Hull) for the First and Second Respondents
(The Third – Fifth Respondents did not appear and were not represented)
Hearing dates: 13, 14, 15, 16, 19, 20, 21, 22 June 2017
Oral closing submissions: 20 July 2017
Draft judgment circulated: 31 July 2017
Contents:
| No | Section | Para. no. |
| 1 | Introduction & Summary | 1 – 12 |
| 2 | The witnesses | 13 – 19 |
| 3 | Outline history | 20 – 106 |
| 4 | Relevant legal principles | 107 – 129 |
| 5 | A quasi-partnership? | 130 – 188 |
| 6 | Wrongful exclusion? | 189 – 196 |
| 7 | Failure to wind up the companies? | 197 – 222 |
| 8 | Wrongful payment of management charges and pension to the Butters brothers instead of dividend? | 223 – 241 |
| 9 | Wrongful lease of the Hall? | 242 – 271 |
| 10 | Benefits wrongfully conferred upon the Butters brothers and their businesses? | 272 – 302 |
| 11 | Wrongful retention of debenture? | 303 – 307 |
| 12 | Overall – conduct unfairly prejudicial to Mr Corran? | 308 – 310 |
| 13 | Relief – if any — to which Mr Corran entitled? | 311 – 318 |
| 14 | Conclusion | 319 |
| 15 | List of Abbreviations | 320 |
Introduction & Summary
This judgment follows the trial of the issues of liability (as specified in the case management order made by District Judge Khan on 10 June 2016) in relation to the unfair prejudice petition presented by the petitioner, Mr Colm Corran, on 15 March 2016. Mr Corran seeks relief as a result of the manner in which he says that the affairs of the third respondent, Energy Express Limited [" Energy Express"], have been conducted by the first and second respondents, Simon Butters and Mark Butters [" the Butters brothers"].
I heard evidence over 8 days from the witnesses of fact (there were no expert witnesses) and was referred to the relevant documentary evidence, which was contained within 41 lever arch files. Having received written closings and heard oral closings I adjourned to produce this judgment. The draft was produced on 31 July 2017. I received a list of typographical errors which were agreed as between counsel. On 11 August Mr Pipe produced a list of more substantive amendments. It was agreed, given professional and holiday commitments, that Mr Maynard-Connor would have until 8 September to respond and I could then address them as necessary prior to the date for the substantive handing down listed for 14 September. On 8 September Mr Maynard-Connor notified me that he was no longer instructed and on 13 September 2017 notice was filed that Mr Corran was acting in person. I have considered Mr Pipe's proposed amendments in accordance with the relevant guidance given in English v Emery (Practice Note) [2002] EWCA Civ 605. I have made no substantive changes to the draft judgment.
I have had the benefit of a full transcript of the evidence. I confirm that I have attempted to take all such material which is in my view relevant into account when determining the issues which are in my view relevant. I have however sought to keep this judgment reasonably concise and to avoid over-loading and over-lengthening it with reference to what I consider to be non-essential facts and issues. In that way I have, I hope, been able to expedite the time taken to produce this judgment. I am extremely grateful to both counsel for their skilful and helpful presentation of their respective cases and to the solicitors for the efficient preparation of their respective cases. Despite the occasional falling-out the parties' legal representatives co-operated to ensure that the trial proceeded smoothly and the trial timetable was maintained.
As to the other parties, the fourth respondent, Greendealexpress Limited [" Greendealexpress"], is the wholly owned subsidiary of Energy Express. Mr Corran makes complaint as to the way in which he says that its affairs have been conducted by the Butters brothers through Energy Express. The fifth respondent, Haus Living Limited [" Haus"], is a company of which Mark Butters is the sole registered shareholder and director. It was joined as a party because there was a potential dispute or confusion as regards the ownership of Haus, which was whether Mark Butters holds the share on trust for Greendealexpress – in which case its affairs and value might be relevant as regards this Petition — or on trust for Mr Corran and the Butters brothers and, possibly, for the Butters brothers' sister, Claire Butters.
In accordance with established practice in unfair prejudice petitions Energy Express, Greendealexpress and Haus were joined to ensure that they are bound by the result of the case but have not taken any active part in the proceedings or been represented at trial.
In relation to Haus, in the Amended Petition at [26] Mr Corran sought a declaration as to the beneficial ownership of the share held by Mark Butters on the pleaded basis that it was held on trust for Mr Corran, the Butters brothers and Claire Butters as to 25% each. This was admitted in the Amended Points of Defence [" APOD"], although in the re-amended version for which permission was given at trial this was replaced by an admission that it was held on trust for Mr Corran and the Butters brothers as to one third each. Neither party sought to resile from their pleaded positions at trial or in closing submissions.
It follows that the parties are agreed, at least on the statements of case and in their positions as advanced at trial, that Mark Butters holds that share on trust not for Greendealexpress but for Mr Corran and the Butters brothers together with, says Mr Corran but not the Butters brothers, Claire Butters as well. However it became apparent in cross-examination that Mark Butters still appears to think that he holds the share on trust for Greendealexpress which, being wholly owned by Energy Express, means that it is ultimately held for the benefit of Mr Corran and the Butters brothers. This appears to be the basis on which it has been asserted on various occasions that Haus is a wholly owned subsidiary of Greendealexpress and also the basis on which certain accounting treatments have been adopted by the accountants when producing the accounts for those two companies. In contrast, Mr Corran's case and evidence is that it was agreed from the outset that Haus was to be a joint venture between himself, the Butters brothers and Claire Butters.
However since, as I say, no-one is positively contending that Mark Butters holds his share in Haus on trust for Greendealexpress it does not seem to me that it is open to me to make such a finding even if I was otherwise inclined to do so. That is particularly the case in circumstances where Haus, Greendealexpress and Energy Express are all parties to this action and where none of them nor any of their directors or shareholders of any of those companies – who are also all parties to this litigation — advance a case to that effect.
As to the second question, the amendment was made in consequence of a letter written to the court by Claire Butters during the trial in which she disclaimed any claim to have any interest in Haus. This assertion has not been accepted as such by Mr Corran. His position is that: (a) as is common ground, she was originally going to be involved in the business to be conducted by Haus and to have an equal 25% interest in the business; (b) he was not party to any agreement under which she divested herself of that interest nor has he been made aware of her having done so; (c) he does not agree with her stated reason for divesting herself of her interest as set out in her letter.
As to this it is important that I do not become embroiled in issues which are not part of this litigation. As I have already said no-one is contending that Haus is owned directly or indirectly by Greendealexpress or by Energy Express. Mr Corran does not and cannot make any complaint in these proceedings – which on his pleaded case concern the affairs of Energy Express and Greendealexpress alone — about the conduct of the affairs of Haus by the Butters brothers. Matters relating to Haus figure in this case only in the context of that part of the petition which complains of benefits said to have been wrongfully conferred upon the Butters brothers and their businesses, including Haus. It follows that I am not directly concerned in this case with the ownership of Haus or with the activities of Haus other than in that limited context.
In the circumstances all that I need do is to record in a recital to the order made following this trial that Mr Corran and the Butters brothers are agreed that neither Greendealexpress nor Energy Express have any beneficial interest in the sole issued share in Haus which is held by Mark Butters. I do not need to, nor should I, determine who does have an interest in that shareholding or on what basis. In particular I do not need to nor should I determine whether or not Claire Butters has any claim to any such interest, nor do I need to nor should I make any findings as to the remainder of the content of her letter which is not before me as evidence of its contents in any event and which I disregard.
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