Hague Plant Ltd v Martin Hartley Hague and Others
| Jurisdiction | England & Wales |
| Judge | Judge Behrens |
| Judgment Date | 05 March 2014 |
| Neutral Citation | [2014] EWHC 568 (Ch) |
| Court | Chancery Division |
| Docket Number | Case No: 2LS 30214 |
| Date | 05 March 2014 |
2014 EWHC 568 (Ch)
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
LEEDS DISTRICT REGISTRY
The Court House
Oxford Row
Leeds LS1 3BG
His Honour Judge Behrens sitting as a Judge of the High Court in Leeds
Case No: 2LS 30214
Christopher Parker QC (instructed by Walker Morris LLP) for the Claimant
Gregory Pipe (instructed by Shulmans LLP) for the First and Third Defendants
Margaret Griffin (instructed by Taylor & Emmet LLP) for the Second Defendant
Hearing dates: 12, 13 February 2014
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.
(No 3)
This is an application by HPL to Re-Amend the Particulars of Claim.
. On 15 August 2013 after a full day's argument I handed down a judgment ("the strike out judgment") in relation to an appeal against a refusal by Judge Saffman to strike out two sections of the Amended Defences. It can be found at [2013] EWHC 2443 (Ch).
. On 3 rd October 2013 after 2 days argument I handed down a judgment ("the Defence Amendment judgment") in relation to an application by the Defendants to Re-Amend the Defence. It can be found at [2013] EWHC 2931 (Ch).
. In those judgments I adopted a number of abbreviations, summarised the parties and the Companies involved in the dispute and summarised – so far as necessary – the nature of the dispute and the allegations in the Amended Particulars of Claim and the Amended Defences.
. I shall adopt the same abbreviations as in the previous judgments.
. The proposed re-amendments greatly increase the allegations and the scope of the allegations made against the Defendants and thus, if allowed, would force substantial further amendments to the Defences.
. It is thus not surprising that (with a number of relatively minor exceptions) the Defendants object to all of the re-amendments.
. Before dealing with the application it is right that I should acknowledge the very considerable assistance I have received from the detailed written submissions from the parties. In the light of the fact that I was allocated 2 days reading for this application it was extremely helpful to have such detailed submissions.
Previous Litigation
. This is in fact the fifth set of proceedings in the bitter dispute between members of the Hague family. It is not necessary to comment in any detail on Hague (2) – (4) save to note that they are summarised in paragraphs 33 to 36 of the joint submissions of Mr Pipe and Miss Griffin ("the joint written submissions").
. Hague(1) is relevant to many of the issues in these proceedings. There is an extensive summary in paragraphs 5 – 27 of the joint written submissions. The action concerned the equitable ownership of shares held by Martin and Jean Angela in MHH. It was resolved in Martin and Jean Angela's favour.
. However the issues in Hague(1) covered a number of areas relevant to the current dispute and the proposed re-amendments. They included the issue of cross-invoicing, the extent of Dianne's knowledge of the practice, the circumstances in which David and Dianne agreed to transfer their shares in MHH to Martin and Jean Angela and the recycling business which was carried on by both HPL and MHH at Carlisle Street.
Witness Statements
. The application is supported by two witness statements from Mr Scott. It is opposed by a witness statement from Mr Wadkin and Mr Cooke.
Mr Scott
. Mr Scott seeks to justify the extensive nature of the amendments by virtue of a number of factors that he sets out in Section 2 of his witness statement. In summary:
1. The Conduct of the Proceedings. He complains that Martin had provided bare denials of liability and refused to provide details of how Martin assessed the fairness of the intercompany trading. He accuses Martin and Jean Angela of misleading the court in their explanation for not providing an account of the stewardship of HPL by Martin. He contends that these factors will justify an inference of dishonesty on the part of Martin and Jean Angela.
2. Changes in the Defendants' case. He contends that the Defendants' case has shifted fundamentally since Hague(1) and during the present proceedings.
1) Cross Invoicing – He contends that the case on cross invoicing has expanded. False invoices now amount to £10.7 million. This requires HPL to set out its case as to why the allegations of cross-invoicing are little more than a smoke screen.
2) Recycling – He contends that the case in relation to recycling has changed. He suggests that there are 2 conflicting lines of evidence being advanced by Martin in relation to the recycling business at Carlisle Street. This has necessitated alterations to HPL's claim.
3) The Grey Books – He contends that Martin's case on the Grey Books has changed from a previous acceptance of their accuracy to the current position where he casts doubt on their accuracy. He makes the point that HPL wish to allege a duty to keep proper records.
4) Responsibility for Invoices – He draws attention to the change in the Defendants' case in relation to the responsibility for the invoices from MHH to HPL which is considered in detail in the Defence Amendment judgment. He contends that, as a result, the Defendants are estopped from denying that Jean Angela was a de facto director.
5) Inter-Company trading – He contends that Martin's attitude to the trading between HPL and MHH (especially with regard to the recycling business carried on at Carlisle Road) had been inconsistent. After citing four examples of inconsistency he asserts that it is "plainly necessary to draw these strands together and deal with the various inconsistencies in the Defendants' position".
3. Disclosure — He makes the point that HPL needs to plead to the JA Note and other (unidentified) documents disclosed by the Defendants.
. Mr Scott's witness statement in Reply contains a number of comments on the witness statements filed by Mr Wadkin and Mr Cooke to which it is not necessary for me to refer. Suffice it to say I have not found them particularly helpful.
Mr Wadkin
. Mr Wadkin devotes the first section of his witness statement to the proportionality of permitting the extensive re-amendments. After commenting on the huge increase in size of the new pleading he set out a chronology which is worth setting out in full:
6. "The Claim Form was issued in these proceedings on 23 June 2011 and was amended twice prior to service. The Particulars of Claim were dated 18 October 2011 and the letters serving the proceedings on the Defendants were dated 20 October 2011.
7. …
8. …
9. To date considerable work has been undertaken by and for the Defendants and very significant expense has been incurred by them in seeking to defend the claims in the way in which the Claimant has sought to advance its claims and run the litigation.
10. The Defendants have had to deal with three substantial Requests for Further Information together with pleading to the Claimant's claims and the Defendants have prepared and served three Requests for Further Information. Disclosure has been considerable and significant further requests for disclosure from the Claimant have been submitted but are presently not being addressed by the Claimant, initially because they relied on an indication made by His Honour Judge Saffman that such issues should await the outcome of the Claimant's application for Summary Judgment, but now, presumably, pending clarification of the Claimant's case which may well require further disclosure and further detailed work to be undertaken. Indeed, the draft Re-Amended Particulars of Claim, themselves, despite their length, require considerably more particularity and, if allowed, will require the detailed preparation of a significant Request for Further Information.
11. These proceedings have, so far, involved 13 applications, including the Application, which have included two applications by the Claimant for Summary Judgment, a detailed application to strike out paragraphs from the Defences and a significant appeal from the decision on that application. Seven full days and further court time have been used to determine those applications and further considerable court time is allocated to the hearing of the Claimant's present application.
12. If the Claimant's application is granted, then over 2 1/2 years since the proceedings were issued and nearly three years since the letter before action was sent, the claim will not have progressed beyond the issuing of the Particulars of Claim and the Defendants will then be put to considerable further work in having to plead to the Re-Amended Particulars of Claim."
. In paragraph 14 he asserts that HPL has changed its position throughout the case and this has resulted in significant work for the Defendants. He concludes in paragraph 16 by asserting that the Defendants will be put to enormous further expense and will suffer further prejudice because they will have to seek further detailed particularity of the new pleading.
. After making comments on the lack of evidence by David or Dianne in support of the allegations in the Re-Amended Particulars of Claim he comments that many of the allegations are inconsistent with the findings in the judgment in Hague(1).
Mr Cooke
. For the most part Mr Cooke adopts the comments made by Mr Wadkin. He does, however, go on (in paragraphs 10 and 11) to deal specifically with the attempt to revive the allegation that Jean Angela was a de facto director of HPL. He points out that Jean Angela has been led to believe since the Amended Particulars of Claim that the allegation that she...
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