Daniel Carlos Scenna v Persons Unknown Using the Identity “Nancy Chen”
| Jurisdiction | England & Wales |
| Judge | James Pickering |
| Judgment Date | 05 April 2023 |
| Neutral Citation | [2023] EWHC 799 (Ch) |
| Docket Number | Claim No. BL-2022-001711 |
| Court | Chancery Division |
| Year | 2023 |
[2023] EWHC 799 (Ch)
James Pickering KC
(sitting as a Deputy High Court Judge)
Claim No. BL-2022-001711
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
BUSINESS LIST (ChD)
Celso De Azevedo (instructed by Giambrone & Partners LLP) for the Claimants
Edward Harrison (instructed by Farrer & Co LLP) for the Seventh Defendant
Edward Levey KC (instructed by Herbert Smith Freehills LLP) for the Eighth Defendant
Hearing date: 27 January 2023
APPROVED JUDGMENT
James Pickering KC (sitting as a Deputy High Court Judge):
PART I: INTRODUCTION
PART II: THE BACKGROUND
PART III: THE CONTINUATION APPLICATION
PART IV: THE DISCLOSURE ORDER APPLICATIONS
PART V: THE JURISDICTION APPLICATIONS
PART VI: THE COSTS APPLICATION
PART VII: CONCLUSION
PART I: INTRODUCTION
The Claimants are the victims of an alleged fraud. The First to Third Defendants are the alleged fraudsters. The Fourth to Sixth Defendants are the recipients of the allegedly stolen monies (and thought to be connected to the fraudsters). The Seventh to Ninth Defendants are the banks (two of which are incorporated in Australia, the other in Hong Kong) at which the Fourth to Sixth Defendants hold their respective accounts.
On 6 October 2022, the Claimants applied to me for ex parte relief. In relation to the First to Third Defendants, I granted worldwide freezing orders (both proprietary and non-proprietary). In relation to the Fourth to Sixth Defendants, I also granted worldwide freezing orders (again, both proprietary and non-proprietary). In relation to the Seventh to Ninth Defendant banks, I refused to grant worldwide freezing orders; I did, however, make certain disclosure orders against them.
As part of that order, I also required an undertaking that the Claimants would issue a Claim Form in relation to the underlying substantive claim. Pursuant to that undertaking, the Claimants subsequently issued and served a claim form together with Particulars of Claim. By those documents, substantive relief was sought against not only the First to Sixth Defendants but also the Seventh to Ninth Defendant banks.
Now, several months later, the matter has returned to me to determine the following matters:
(1) the return date of the Claimants' application for the continuation of the worldwide freezing orders as against the First to Sixth Defendants (“ the Continuation Application”);
(2) the applications of the Seventh and Eighth Defendant banks challenging the grant of the disclosure orders (“ the Disclosure Order Applications”);
(3) the applications of the Seventh and Eighth Defendant banks challenging the jurisdiction of the English court in respect of the substantive claim (“ the Jurisdiction Applications”); and
(4) a short point regarding costs (“ the Costs Application”).
PART II: THE BACKGROUND
As stated above, the Claimants are the victims of an alleged fraud. The First Claimant is resident in Canada and the Second Claimant is his company, an Ontario registered entity.
As also stated above, the First to Third Defendants are the alleged fraudsters. Pursuant to the alleged fraud, between March and April 2022 the First to Third Defendants persuaded the Claimants to make various payments (totalling around US$2.9 million) to:
(1) an account in the name of the Fourth Defendant held at the Ninth Defendant bank in Hong Kong;
(2) an account in the name of the Fifth Defendant held at the Seventh Defendant bank in Australia; and
(3) an account in the name of the Sixth Defendant held at the Eighth Defendant bank, also in Australia.
In May 2022, the Claimants first suspected that they might have been defrauded. In June 2022, their suspicious were confirmed.
On 6 October 2022, the Claimants applied to me for interim relief. As stated above, while I was prepared to grant worldwide freezing orders against the First to Sixth Defendants, I was not prepared to do so against the Seventh to Ninth Defendant banks. I did, however, make disclosure orders against them requiring them to provide in relation to the relevant bank account in each case:
“(1) the transaction history starting from the respective dates of transfer of the Relevant Sums onwards to the date of service of this Order, including:
(i) the deposit history;
(ii) the withdrawal history;
(iii) the access logs;
(iv) the approved devices; and
(v) know-you-client information relating to the respective bank and/or online account holders (including name, address, email addresses, and any other contact details available).
(2) the final balance, meaning the balance on the date of service of this Order…”
On about 10 October 2022, the Claimants issued an application to continue the freezing order as against the First to Sixth Defendants – in other words, the Continuation Application.
On about 14 October 2022, the Claimants served a Claim Form and Particulars of Claim. As set out above, the defendants to the substantive claim were not only the First to Sixth Defendants but also the Seventh to Ninth Defendant banks.
On 28 October 2022, the Claimants renewed their application for proprietary interim injunctive relief as against the Seventh to Ninth Defendant banks. Subsequently, however, that application was withdrawn. It is the costs arising out of this withdrawal which are the subject of the Costs Application.
On 10 November 2022, the Seventh and Eighth Defendant banks (“ the Banks”) each issued applications seeking to challenge the disclosure orders made against them – in other words, the Disclosure Order Applications.
On 6 December 2022, the Banks each issued further applications, this time seeking to challenge the jurisdiction of the English court in respect of the substantive claim – in other words, the Jurisdiction Applications.
In due course, each of the Continuation Application, the Disclosure Order Applications, the Jurisdiction Applications and the Costs Application were listed to be heard before me as part of the present hearing.
PART III: THE CONTINUATION APPLICATION
At the ex parte hearing on 6 October 2022, I was satisfied that, in relation to the First to Sixth Defendants, the various requirements for worldwide freezing order relief (both proprietary and non-proprietary) were made out. Since making that order, there has been a complete lack of engagement on the part of the First to Sixth Defendants – no correspondence has been entered into, no evidence has been filed, and none of them appears before me today. In these circumstances, and having reviewed both the evidence which was before me at the ex parte hearing and the further evidence which has been filed for today, I remain satisfied that those requirements continue to be met.
Accordingly, and as indicated by me during the course of the hearing, I will continue the worldwide freezing order relief as against the First to Sixth Defendants. The precise terms of the order can be finalised in due course but I indicate here that I will be sympathetic to any drafting points raised by the Banks to avoid any ambiguity in the Baltic proviso which currently appears in paragraph 26 of the order of 6 October 2022.
PART IV: THE DISCLOSURE ORDER APPLICATIONS
Approach
By the Disclosure Order Applications, the Banks seek to challenge the disclosure orders which I made as part of the ex parte order of 6 October 2022.
Having heard submissions from all counsel, it seems to me that there are 2 approaches open to me.
The first is that I simply consider whether I ought to discharge the disclosure order (in so far as it relates to the Banks) pursuant to paragraphs 2 and 18 of the ex parte order which, in the usual way, entitles anyone served with or notified of the order to apply to vary or discharge it. Given that disclosure order relief is effectively final relief, on this basis I simply need to make a final determination as to whether the disclosure order I made should stay in place or whether I should discharge it.
The alternative approach is to focus on the permission to serve the disclosure order out of the jurisdiction contained in paragraph 15 of the ex parte order. On this basis, I need to consider whether the well-established requirements for an order for service out have been met and, if they have not, set aside that part of the order accordingly.
I will consider both approaches in turn.
Should I simply discharge the disclosure order?
In general, the five criteria for making a disclosure order for what is commonly known as Bankers Trust relief 1 are set out in Kyriakou v Christie Manson and Woods Ltd [2017] EWHC 487 (QB) as follows:
(1) there must be good grounds for concluding that the property in respect of which disclosure is sought belongs to the applicant;
(2) there must be a real prospect that the information sought will lead to the location or preservation of the relevant property;
(3) the order should not be wider than necessary;
(4) the interests of the applicant in getting the disclosure must be balanced against the detriment to the respondent; and
(5) appropriate undertakings must be given in respect of the use of the disclosed information and/or documents.
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