David Ames and Another (Respondents/Claimants) v Conrad Davies & 22 Others (Applicants/Defendants)
| Jurisdiction | England & Wales |
| Judge | Mrs Justice Cox DBE,Mrs Justice Cox |
| Judgment Date | 19 February 2016 |
| Neutral Citation | [2016] EWHC 235 (QB) |
| Court | Queen's Bench Division |
| Date | 19 February 2016 |
| Docket Number | Case No: HQ15X03742 |
[2016] EWHC 235 (QB)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Royal Courts of Justice
Strand, London, WC2A 2LL
Mrs Justice Cox
Case No: HQ15X03742
Tony Beswetherick (instructed by Fletcher Day) for the Applicants/Defendants
Nicholas Davidson QC (instructed by ELS Legal LLP) for the Respondents/Claimants
Hearing date: 13 January 2016
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.
Introduction
On 20 October 2014 the Claimants in this matter, David and Carol Ames, entered into a settlement agreement in previous proceedings brought against them by the present Defendants (Case number HQ13X02764). By the terms of that agreement they promised to pay the Defendants the sum of £1.3 million by 2 September 2015. No part of that sum has ever been paid. Instead, the Claimants have now issued these proceedings alleging that they were induced to enter into that agreement as a result of false misrepresentations by the Defendants' former solicitor, entitling them to rescind the agreement; or alternatively that the Defendants are in repudiatory breach of their obligations under that agreement, entitling the Claimants to terminate it.
The Defendants contend that the allegations now being advanced are all entirely without factual and legal merit; and that they amount to a desperate last-ditch attempt to avoid payment of the agreed sum, motivated by the Claimants' inability or unwillingness to pay. All save the Twelfth Defendant (who is resident outside the jurisdiction and has only recently been served with the proceedings) are applying for the Claim Form and Particulars of Claim to be struck out, or alternatively for summary judgment to be entered in their favour on all the claims made against them. If that primary application fails they apply, in the alternative, for conditions to be imposed upon the pursuit by the Claimants of their claim, or such parts as may remain following delivery of this judgment.
The Claimants say that the pleadings raise issues which can only properly be resolved at trial, after hearing oral evidence; and that there is a compelling reason why there should be a trial, namely to "get to the truth" of what led to the settlement agreement being signed. The Defendants' application to strike out or for summary judgment should be dismissed.
To avoid confusion I shall refer to the Defendants as the "Davies Group" and to Mr and Mrs Ames as the Claimants.
The Relevant Facts
The main occupation of David Ames, conducted through various companies, is the development of hotels and leisure resorts in the Caribbean. He is the controlling owner of a number of companies registered in the Caribbean and known as the Harlequin Group. He is a director of Harlequin Property (SVG) Ltd, the most important company in this group, and his wife, Carol Ames, is a director and co-shareholder in this company.
The members of the Davies Group are all individuals who were encouraged to invest money in these development schemes. They entered into contracts to purchase properties in the proposed developments and they each paid substantial sums by way of deposits.
In May 2013 the Davies Group, at that stage comprising only the 1 st to 13 th Defendants, commenced proceedings against the Claimants alleging that they were induced to enter into those contracts and to hand over substantial sums of money by fraudulent misrepresentations, for which the Claimants were responsible. They claimed damages for deceit and for breach of trust.
On 14 May 2013 Mr Justice Singh granted an ex parte application for a Freezing Order, preventing Mr and Mrs Ames from removing assets up to the value of £1.1 million from the jurisdiction; restricting their ability to deal with or dispose of assets worldwide; and requiring them both to provide detailed information as to their assets. On 3 June 2013 Mr Justice Coulson accepted undertakings from the Claimants in essentially similar terms, such that the Freezing Order was not continued. The Claimants were ordered on that occasion to provide valuations of four specified properties in Essex, together with details of any encumbrances.
The remaining members of the Davies Group were then joined to the proceedings and, on 21 October 2013, Mr Justice Globe granted the Group's application to freeze additional assets to the value of £1.4 million. The Claimants' applications for specific disclosure were dismissed and they were both ordered to provide further evidence as to their assets, including the valuation of 43 separate companies identified in the schedule attached to the order. A further Freezing Order was made by Mr Justice Tugendhat on 10 March 2014, when he ordered the Claimants to provide additional evidence as to their assets.
The trial was fixed to start in January 2015. An attempt in mid-2014 to postpone disclosure and mediate the dispute failed. On 7 August 2014, the Davies Group issued committal proceedings on the basis that Mr and Mrs Ames had failed to comply with the various court orders as to disclosure of their assets. In evidence filed in support it was alleged that the Claimants had failed to disclose numerous foreign property interests, dividends and investment income. No evidence was filed by Mr and Mrs Ames in response to the application for their committal.
The committal application was originally listed in an interim hearing window commencing on 13 October 2014. In the weeks leading up to that date further negotiations took place between the parties' solicitors, with a view to possible settlement of the claim. These negotiations resulted in the Tomlin Order dated 20 October 2014, signed by both parties, with all further proceedings in the action being stayed on the terms agreed in full and final settlement of the Davies Group's claims, as set out in the Schedule (the "Settlement Agreement").
Before referring to the terms of the Settlement Agreement, it is a relevant factor in this case that the Claimants were (and still are) involved in entirely separate litigation in the TCC relating to the Caribbean developments, in a claim for damages for breach of contract and professional negligence (HT2014–000038) brought by two Harlequin companies against a firm of accountants, Wilkins Kennedy. The same partner in the firm ELS Legal LLP, Richard Spector, has conduct of that litigation and of both sets of proceedings involving the present parties.
There is no dispute that the Wilkins Kennedy litigation, and the potential existence and availability of documents that might assist the Claimants in that litigation, formed part of the settlement discussions in September/October 2014 between Mr Spector and Chris Corney, a partner in Carter Lemon Camerons LLP ("Carter Lemon"), the firm then acting for the Davies Group. That TCC litigation is on-going and I am told that it is presently listed for trial commencing in June this year.
Under the terms of the Settlement Agreement Mr and Mrs Ames agreed to pay the Davies Group the " Settlement Monies" defined as " The sum of £1,300,000 (inclusive of interest and costs)." Clause 3 provided, so far as relevant, that:
" The Defendants shall pay to the Claimants the Settlement Monies on or before the earlier of (a) within 3 days after receipt of any monies recovered pursuant to the Wilkins Kennedy Litigation in accordance with the undertaking at Paragraph 27 or (b) the Long Stop Date…"
Mr and Mrs Ames undertook, at Clause 27, to notify Carter Lemon of the date of any settlement or final judgment in the Wilkins Kennedy litigation. The " Long Stop Date" was defined as 2 September 2015. Since the Wilkins Kennedy litigation is still live and no payments have been made to the Claimants in part settlement of that claim, 2 September 2015 is the relevant date for the purposes of the Claimants' obligation to pay under this Settlement Agreement.
Other express terms of the Settlement Agreement relevant to the present application are contained in Clauses 29 and 30, as follows:
" 29. The parties will continue to discuss mutual cooperation in relation to the Wilkins Kennedy Litigation after the date of this agreement. The Claimants will use their best endeavours to procure documentation to assist the Wilkins Kennedy Claimants. In the event that the Claimants provide further documentation on a voluntary basis the parties may agree that a further sum up to a maximum of £250,000 for all documentation available to the Claimants now or in the future will be payable to the Claimants in addition to the Settlement Monies in the event that the Wilkins Kennedy Litigation recovers a sum in excess of the Settlement Monies.
30. The terms of this Agreement, and the substance of all negotiations in connection with it, are confidential to the parties and their advisers, who shall not disclose them to, or otherwise communicate them to, any third party without written consent of the other party, other than:
a) pursuant to an order of a court of competent jurisdiction, or pursuant to any proper order or demand made by any competent authority or body where they are under a legal or regulatory obligation to make such a disclosure;
b) as far as necessary to implement and enforce any of the terms of this Agreement, …"
Mr and Mrs Ames have failed to pay any part of the Settlement Monies to the Davies Group....
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