Eva-Maria Bucher-Haefner v Max Lewinsohn
| Jurisdiction | England & Wales |
| Judge | Jones |
| Judgment Date | 16 August 2022 |
| Neutral Citation | [2022] EWHC 2080 (Ch) |
| Docket Number | Case No: BL-2022-000645 |
| Court | Chancery Division |
[2022] EWHC 2080 (Ch)
INSOLVENCY AND COMPANIES COURT JUDGE Jones
SITTING AS A HIGH COURT JUDGE
Case No: BL-2022-000645
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
BUSINESS LIST (ChD)
Royal Courts of Justice
Rolls Building, Fetter Lane, London
Mr Darragh Connell (instructed by Cooke, Young & Keidan LLP) for the Claimant
Mr Rory Brown (instructed by Brandsmiths S.L. Limited for the Defendants
Hearing dates: 28–29 July 2022
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.
CHJ 16/08/22
I.C.C. JUDGE Jones SITTING AS A JUDGE OF THE HIGH COURT
I.C.C. Judge
A) The Claim
Ms Bucher-Haefner by claim form issued on 14 April 2022 asks for an anti-suit injunction in respect of “Verified Complaint and Jury Demand” proceedings (“the Complaint”). It was issued in the Third Judicial District Court of the State of Utah by the above-named Defendants (although the second defendant is Mr Lewinsohn's business's trade name) and is dated 18 March 2022. It claims: (i) damages for breach of an Intercreditor Agreement; (ii) damages for breach of an implied covenant of good faith and fair dealing; and (iii) compensation for unjust enrichment. In essence it seeks recovery of costs and expenses incurred by Mr Lewinsohn as a collateral agent under the terms of the Intercreditor Agreement dated 18 March 2005. The only liquidated sum is a figure for unjust enrichment of US$4.8 million.
Whilst the damages claimed are not particularised, the sums in issue can be identified (and this is not in dispute) from the preceding demand by letter dated 11 February 2022. Namely: (i) $2.45m (£1,803,664.39) being “the total Collateral Agent Costs” unrelated to the UK action which remain outstanding despite request for payment. The total … $3.3m … has been reduced as the Collateral Agent has received payment of $850,000 to date”. (ii) £854,314 being the sums incurred in defending the claims brought in the UK by Catalyst Investment Group Limited and others including you, which are subject to the Application [to strike out the old UK claim … for want of prosecution]; and (iii) £112,201.50 … incurred by Brandsmiths, associated with the Application to dismiss the UK action.”
Ms Bucher-Haefner contends that the sums claimed in the Complaint mirror the sums previously counterclaimed by Mr Lewinsohn and his firm in claim number BL-2020-001467 to which she had been a claimant (together to be called “the Claim and Counterclaim”).
The Counterclaim included the following description of claim:
“68(1) All costs incurred as Collateral Agent pursuant to the terms of the Intercreditor Agreement, including the Collateral Agent's costs and legal expenses relating to proceedings in Utah and England
(2) An indemnity against any liability that he might have for the Claimant's [sic] costs of these proceedings insofar as they are brought against him or by him in his capacity as the Collateral Agent.”
The Claim and Counterclaim were dismissed as between Mr Lewinsohn and Ms Bucher-Haefner on 15 March 2022 in circumstances of Mr Lewinsohn's application “to strike out” (strictly it should have read “dismissed”) the Claim for want of prosecution and his and Ms Bucher-Haefner's acceptance that this should be the result for both Claim and Counterclaim. This occurred in the circumstance of both having accepted that a fair trial could no longer be achieved because of the time that had expired. For reasons set out in a judgment of Deputy Master McQuail no order as to costs was made in respect of the Claim and Counterclaim upon their dismissal. There has been no appeal.
Costs orders were made subsequently requiring Mr Lewinsohn to pay Ms Bucher-Haefner's costs of the “strike out” application with an interim payment of £100,000 but set off against a costs order for a specific period in favour of Mr Lewinsohn. There were also certain other outstanding costs orders against Mr Lewinsohn.
Ms Bucher-Haefner contends that the decisions of Deputy Master McQuail (i.e. the dismissal, the no order as to costs and the other costs orders) mean that this Court has already decided the claims which the Complaint seeks to raise and/or that it would in any event be an abuse of process for Mr Lewinsohn to be able to pursue again in another jurisdiction the very matters raised by him or which ought or could have been raised by him in the dismissed Counterclaim and within the costs decisions. In particular that it has been decided that he should not claim or that it would be wrong to permit him to continue to claim the right to be paid the costs sought under the indemnity provision of the Intercreditor Agreement.
As a result, Ms Bucher-Haefner's case is that the Complaint recently commenced in the State of Utah is vexatious, oppressive, unconscionable and/or an abuse of process. That it would not be in the interests of justice for Mr Lewinsohn to be permitted to continue those proceedings. Her case is that absent an injunction “she will face a Hobson's choice of defending the proceedings or having a default judgment in the sum of US$4.8 million entered against her”.
(B) Background
Ms Bucher-Haefner is a Swiss national. Mr Lewinsohn is resident and domiciled in England and Wales. Maximilian and Co is an unincorporated firm and, therefore, is the trading name of his business. It appears that the two have been separately named as litigants in proceedings in this jurisdiction and in Utah. The reasons for that may be described as “lost in history” but in practical terms it matters not for this decision. This judgment will not distinguish the two as separate legal entities.
The dispute can be traced back in terms of proceedings to the Claim issued by Catalyst Investment Group Limited (“Catalyst”) against Mr Lewinsohn concerning his role as the Collateral Agent under the terms of the Intercreditor Agreement for the holders of promissory notes issued in 2005 by Eneco Inc (“Eneco”), now dissolved. Mr Lewinsohn became the Collateral Agent by assignment as a successor from 3 November 2007 or thereabouts to the original appointee, Christopher P. Baker.
The terms of the notes provided that principal and 12% annual, quarterly compounded, interest were due to be repaid by no later than 31 March 2006. Extensions of time for repayment were granted but nothing has been paid. Eneco's repayment obligations under the Notes were secured rights in favour of the Collateral Agent under the Intercreditor Agreement. Those rights were held for the benefit of the holders of the Notes (including Ms Bucher-Haefner) against Eneco's reversionary interest in certain international patents registered in Eneco's name. There were separate Security and Lending Agreements.
Upon Eneco's default the Collateral Agent was empowered but not obliged to realise the IP Rights and apply the proceeds of sale in accordance with the terms of the Intercreditor Agreement, including in the discharge of Eneco's obligations to the Noteholders. The duties and obligations on the collateral agent are set out in sections 3.02 and 3.03. They included the taking of actions deemed “necessary or advisable to preserve its rights in the Collateral.” It appears that the Collateral Agent was to act in a commercial, reasonable manner in the exercise of its rights, powers and duties and was not bound to act.
The Security Agreement and the Intercreditor Agreements were expressly governed by Utah law. However, both omitted the State of Utah, exclusive jurisdiction clause that was also included in the Notes and the Secured Loan Agreements. Mr Lewinsohn claims that the clause must equally apply to the other two agreements because they are all documents within a linked transaction.
Further background details can be found in the 31 July 2009 judgment of Mr Justice Barling, as he then was, in the Claim. I certainly could not improve upon his analysis of the facts and should not even seek to do so. Paragraphs 5–44 of that judgment are to be read into this.
Of detailed relevance as background for this claim for specific mention are the paragraphs referring to: (i) The June to October 2008 proceedings in the Utah Bankruptcy Court concerning approval of the sale by Eneco of IP rights to Mr Lewinsohn. (ii) The proceedings commenced on 8 November 2008 by the Noteholders against Catalyst and ARM Asset Backed Securities Inc (“ARM”) and another alleging fraud or negligent misrepresentations concerning letters in December 06. (iii) A mirror action in Utah issued by Mr Lewinsohn about the same time covering more or less the same facts and matters. It was dismissed on 13 October 2009 at the request of Mr Lewinsohn and other claimants. (iv) The allegations of Catalyst in 7 November 2008 correspondence to the effect that Mr Lewinsohn when purchasing the IP Rights breached the fiduciary duties owed to the Noteholders. (v) The issuing here on 17 November 2008 of the Claim by Catalyst against Mr Lewinsohn seeking (in summary) declarations as to title, that there had been no breach of Catalyst's contractual obligations to Eneco or any misrepresentations by Catalyst and claiming (amongst other matters and against other parties) that Mr Lewinsohn had breached duties owed to the Noteholders. The claim included by later amendment 10 further claimants including Ms Bucher-Haefner. (vi) A claim by Catalyst and Timothy Roberts against Mr Lewinsohn but although this runs alongside the Claim, it and a claim issued by ARM need not be referred to separately for the purposes of this judgment.
On 31 July 2009 Barling J. refused Mr Lewinsohn's application for Catalyst's claim...
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