Dondore Incorporated v Nasser Fetaimia
| Jurisdiction | England & Wales |
| Judge | Miss Amanda Tipples |
| Judgment Date | 18 July 2018 |
| Neutral Citation | [2018] EWHC 1832 (Ch) |
| Court | Chancery Division |
| Docket Number | Case No: HC-2016-001132 |
| Date | 18 July 2018 |
[2018] EWHC 1832 (Ch)
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
The Royal Courts of Justice
Rolls Building, Fetter Lane,
London, EC4A 1NL
Miss Amanda Tipples QC
Case No: HC-2016-001132
Mr Christopher Langley (instructed by Joelson LLP) for the Claimants
Mr Kevin Pettican (instructed by Treon Law) for the Defendants
Hearing dates: 30 April, 1, 2, 3, 4 May 2018
Miss Amanda Tipples QC:
Introduction
Albert Court on Prince Consort Road, London is a mansion block located at the back of the Royal Albert Hall, South Kensington, London. Flat 5A, Albert Court (“ the property”) is a three-bedroomed basement flat, which is now estimated to be worth in excess of £2.5 million.
The first claimant, Dondore Incorporated (“ Dondore Inc”), is the registered proprietor of the property (Title No. NGL592569) and is a company registered in the British Virgin Islands. The second claimant, Mr Richard Hitt (“ Mr Hitt”), holds the share certificate for the entire shareholding in Dondore Inc and is the legal owner of all the shares in the company. He is also its sole director.
The defendants, and their children, are in occupation of the property and, for many years, it has been their home. There is no single document available which records the basis on which they are in occupation of the property.
The defendants maintain they are entitled to live at the property because Mrs Victoria Fetaimia (“ Mrs Fetaimia”) owns all the shares in Dondore Inc, as she purchased them pursuant to an agreement made with Mr Hitt in respect of which £900,000 has been paid. The claimants dispute the existence of any such agreement, together with the allegation that £900,000 has been paid in respect of the purchase of the shares. The claimants say that any right the defendants have to occupy the property was terminated by notices to quit served in 2015, and they are now entitled to possession of the property.
On the main issue I have decided that the claimants are not entitled to possession of the property. There was an agreement that Mrs Fetaimia would purchase the shares in Dondore Inc from Mr Hitt and Mr Hitt has been paid in full in respect of them. In 2011 Mr Hitt directed Mr Marcel Nasser Fetaimia (“ Mr Fetaimia”) to pay for the shares by transferring funds to West African Gold Limited (“ WAGL”). The payment was made in three tranches, on the instructions of Mr Fetaimia, by another company called Waterfront Marine Solutions Limited (“ WMS”).
The claim and counterclaim
The proceedings for possession of the property were commenced in the Hammersmith County Court on 24 September 2015. In addition to the order for possession, the claimants seek mesne profits, damages for conversion, interest and costs.
The defendants counterclaim for a declaration that the entire shareholding in Dondore Inc belongs to them, for the return of their personal property, for the repayment of £900,000, for £19,000 in respect of an insurance claim, for damages, interest and costs.
The claimants' statement of case
The claim for possession is set out in the Amended Particulars of Claim dated 7 July 2016 in these terms:
“[2]. The Defendants currently occupy the Property and have done since around 2003… [4]. [Dondore Inc] is entitled to possession of the Property by virtue of it being the registered proprietor. Alternatively, if [Mr Hitt] is still the beneficial owner and/or joint legal owner of the Property, then he is entitled to possession of the same. [5]. No rent was payable in respect of the Defendants' occupation. [6]. The Defendants do not have exclusive possession of the Property. [Dondore Inc] allowed the Defendants into occupation on the basis that its director, [Mr Hitt] would be permitted to access and stay in the Property when in London and/or would retain space in the Property for the storage of personal items. [7.] In the premises, the Defendants' occupation of the Property was by way of licence. [8.] Pursuant to his rights, either under the licence as [Dondore Inc's] director or otherwise, [Mr Hitt] did in fact stay in the Property from time to time when he was in London. [9.] On or around 21 September 2015, [Dondore Inc] served a notice to quit on the Defendants, requiring possession by 22 September 2015. A further notice to quit (without prejudice to the first) was served on the Defendants on 5 October 2015 requiring possession by 6 November 2015.”
The defendants' statement of case
The Amended Defence and Counterclaim is dated 19 January 2017 (and signed by both defendants with a statement of truth):
“[10.] Paragraph 2 is admitted save that [Mr Fetaimia] has been in occupation of the Property since 14 December 2004 and the Defendants currently live at the Property with their 3 children ages 12, 9 and 6 born in London and registered at that address.
[11.] Paragraph 4 is denied. The entire shareholding in [Dondore Inc] belongs to [Mrs Fetaimia] and the Defendants are entitled to occupy the Property as they have done since 2004.
[12.] Paragraph 5 is admitted on the premise that [Mrs Fetaimia] is the owner of the entire shareholding of [Dondore Inc] and by arrangement between [Dondore Inc] controlled by [Mrs Fetaimia] and the Defendants, no rent was payable for occupation of the Property.
[13.] Paragraph 6 is denied. The Defendants have and always have had exclusive possession of the Property by virtue of their case pleaded in this Amended Defence. [Mr Hitt's] right to have access to the Property terminated on 19 October 2011 when the entire shareholding was purchased by [Mrs Fetaimia].
[14.] [Mr Hitt] never stayed at the Property during the period it was occupied by the Defendants and any arrangement he may have had for the storage of his personal items was terminated on 11 November 2011, one month after the purchase by [Mrs Fetaimia] of the shares in [Dondore Inc] was completed. [Mr Hitt] is put to strict proof that he stayed at the Property after 19 October 2011.
[15.] Paragraph 7 is denied. In December 2004 [Mr Hitt] agreed to form a company, subsequently [Dondore Inc] and to then sell his shares in that company ([Dondore Inc]) to [Mrs Fetaimia] for £450,000. It was further agreed between [Mr Hitt] and the Defendants that the Defendants may occupy the Property until the purchase of the Property was completed through the incorporation of the company ([Dondore Inc]) and the purchase of the shares in [Dondore Inc] was completed by [Mrs Fetaimia]. The Claimants are put to strict proof of the existence of such a licence.
[16.] Paragraph 8 is denied. [Mr Hitt] never stayed at the Property whilst it was occupied by the Defendants. It is denied that there was a licence conferring any rights for [Mr Hitt] to occupy the Property and [Mr Hitt] is put to strict proof of the existence of any such licence. [Mr Hitt] is further required to identify what other rights he may have had to occupy the Property.
[17.] Paragraph 9 is admitted in that a document dated 21 September 2015 and a further document dated 5 October 2015, both purporting to be a Notice to Quit, were sent to the Defendants, but it is denied that either of those documents are valid and of any effect. The purported notices are not in the prescribed form; and the Claimants have not produce a copy of the alleged licence, and the terms of that licence have not been particularised at all.” ( underlining added)
The defence does not contain any allegation as to when the defendants say the purchase price of £450,000 was paid. However, the material parts of the counterclaim provide that:
“[29] On 19 October 2011 [Mr Hitt] sold his shares in [Dondore Inc] to [Mrs Fetaimia]. [Mr Hitt] has failed to provide the Defendants with the relevant stock transfer forms and had further failed to record the sale in the records of [Dondore Inc]… [31] Between 2004 and 2011 the Defendants paid [Mr Hitt] in excess of £900,0000 in addition to the cost of the shares in [Dondore Inc]. Full particulars of that payment will be provided. The Defendants require [Mr Hitt] to repay £900,000 (the exact amount will be provided) plus interest.” ( underlining added)
The defendants therefore allege that they paid Mr Hitt more than £900,000 between 2004 and 2011 in addition to the cost of the shares. In this regard I agree with what was said by Mr Jeremy Cousins QC, sitting as a Deputy High Court Judge, on 2 May 2017 (as recorded in Mr Langley's note of that hearing):
“[6]. It seems to me that taking those words at face value what they indicate is that the [defendants'] case is not only has £900k been paid but that sum over and above payment of costs of shares in [Dondore Inc]. So there was there seems to me [at the] outset an allegation that there had been payment greater than [the] cost of shares, but [the] cost of the shares had indeed been paid.”
The claimants did not make any request for further information under CPR Part 18 in respect of the payment alleged by the defendants.
However, in terms of the particulars of alleged payment, the defendants have relied on a two-page document entitled “Wire Transfers to Richard W. Hitt Bank Accounts Matanya Trading & WAGL SARL”, which was prepared in August or September 2016. This document contains the particulars alleged in respect of 11 payments and it is said that three of these payments, made on 25 July 2011, 27 July 2011 and 19 October 2011, relate to Dondore Inc and total Euros 1,081,032.25 (said to be worth £940,000) (“ the Defendants' Schedule of Payments”). The other eight payments formed the basis of the defendants' counterclaim for repayment of £900,000.
The claimants' reply and defence to counterclaim denies the existence of any such agreement and that payment had been made. Further, at paragraph 2 the claimants...
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