Holyoake and another v Candy and Others

Hearing dates: 7th & 8th April 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 7 and 8 April 2016 I heard an application for an interlocutory injunction brought by the Claimants against three of the Defendants in this action, namely the First, Second and Sixth Defendants (" the Defendants"). As issued, the application sought to restrain them from disposing, dealing or otherwise engaging in transactions with their assets in the sum of or to the value of more than £1m without first giving the Claimants' solicitors 7 days advance notice in writing. As appears below, by the end of the hearing the relief sought had been significantly modified. I had previously indicated that I hoped to be able to give the parties at least the answer straight away, and in the event when argument finished on the afternoon of 8 April 2016 I indicated that I was satisfied that it was an appropriate case for some relief to be granted, but in the light of the late change to the nature of the relief sought I would adjourn the application for further evidence to be filed, granting a temporary injunction in the meantime. I gave my views on various matters which had been argued before me quite briefly and this judgment is intended to set out my reasons for the views which I then expressed.

Background

I can take the background from a judgment delivered by Arnold J on 7 September 2015 when he refused an application by the Claimants for expedition. He said as follows:-

"1 The first claimant, Mr. Mark Holyoake, claims to be a successful businessman with a background in property development in the food industry. The second claimant, Hotblack Holdings Ltd, is a Jersey registered company with a BVI parent, ultimately owned by Mr. Holyoake.

2 In 2011, the claimants were seeking to purchase a substantial and valuable property in Grosvenor Gardens in order to develop it. They say they were expecting to make profits of more than £100 million by this venture. In October 2011, Mr. Holyoake approached the first defendant, Mr. Nicholas Candy, the well-known property developer and thought by Mr. Holyoake to be an old friend, for a loan of some £12 million required at 24 hours' notice to help complete the purchase and proceed with the redevelopment. A loan of £12 million under a written loan agreement was duly made to Mr. Holyoake by the sixth defendant, CPC Group Ltd ("CPC"), with a term of two years.

3 CPC is a Guernsey registered company which appears to be ultimately owned, or at least controlled, by Nicholas Candy and his brother, the second defendant, Mr. Christian Candy. The third, fourth and fifth defendants, Mr. Richard Williams, Mr. Steven Smith and Mr. Timothy Dean were directors of CPC at the material times.

4 It is the claimants' claim that thereafter Mr. Holyoake was subjected to a long-running, highly unpleasant and vitriolic campaign of threats, abuse, intimidation and coercion directed at himself and his family by the defendants. The claimants say that Mr. Holyoake was bullied and coerced into entering into a long series of further agreements with CPC and into procuring that Hotblack enter into certain of these agreements. The claimants say that these agreements were highly disadvantageous to them and highly advantageous to CPC. In the result, so the claimants say, Hotblack was eventually forced to sell the property in question at a loss in February 2014 and Mr. Holyoake was forced to pay a total of more than £37 million to CPC for his initial loan of £12 million. Accordingly, the claimants made no profit from the venture. On the contrary, they made a loss.

5 The claimants say that they have been the victims of a conspiracy on the part of the defendants. The conspiracy is categorised as an unlawful means conspiracy in which the unlawful means relied on are as follows: first, fraudulent misrepresentation; secondly, duress; thirdly, actual undue influence; fourthly, intimidation; fifthly, unlawful interference with business/economic interests; sixthly, extortion under colour of due process; seventhly, extortion simpliciter; and lastly, blackmail. The claimants also bring freestanding claims under the first six of those heads together with a claim for relief under s.140(a) and (b) of the Consumer Credit Act 1974.

6 The claimants' claim has been pleaded in extensive particulars of claim that run to no fewer than 208 paragraphs and, as counsel for the claimants fairly points out, are detailed and well particularised, at any rate at first blush. The claimants value their claims at in excess of £132 million, excluding aggravated or exemplary damages which they also seek.

7 Unsurprisingly, the defendants' perspective on these matters is rather different. At this stage, the defendants have yet to file their defences, but counsel for the defendants submits as follows in his skeleton argument. First, that on his own account Mr. Holyoake was a wealthy and experienced businessman. He claims to be worth in excess of £100 million. At all material times, he acted with the benefit of a raft of advisers, including investment professionals and sophisticated commercial lawyers. He was not an innocent in such matters, it is said.

8 Secondly, it is alleged that Mr. Holyoake defaulted on the loan from day one and that the resulting further security and loan extensions entered into by Mr. Holyoake were agreed by him in order to stave off enforcement and so that he could continue to pursue the huge profits which he anticipated making from the development.

9 Thirdly, it is alleged that Mr. Holyoake expressly acknowledged his default at the time. Now, he wishes to paint a different position, but it is contended by the defendants that the reality was as he acknowledged at the time, namely that he was in default. In any event, the defendants contend that it is sufficient for their purposes that they genuinely believed him to be in default, which they say they plainly did.

10 Fourthly — and this is a matter that is particularly germane to the present application — it is pointed out that Mr. Holyoake initially raised his complaints against CPC back in August 2013 and that led to a compromise of the dispute between Mr. Holyoake and CPC in a settlement deed dated 15 October 2013. The defendants say, moreover, that Mr. Holyoake affirmed that agreement on subsequent occasions.

11 Is it is plainly not possible or appropriate for me to express any view whatsoever as to the merits of these rival claims and counterclaims. It is sufficient at this stage for me to proceed on the basis that there is here a substantial claim made in particulars of claim which are lengthy and detailed and that there will no doubt be an equally lengthy and detailed defence."

Since Arnold J's judgment the Defendants have filed a lengthy and detailed Defence which in summary not only relies on the Claimants having settled any claims which they might have had by the October 2013 Settlement Deed but also alleges that Mr Holyoake lied about his assets and the imminence of refinancing funds; that he deliberately misrepresented or failed to disclose various specific matters; that he was in breach of the loan agreement, with the result that events of default occurred, from the inception of the loan; and that all CPC did was seek lawfully to recover the money lent to Mr Holyoake shortly after the loan was advanced. It is specifically denied in the Defence that any unlawful or inappropriate threats were made or any threats of violence. It is accepted that sometimes idioms, metaphors and swearing were used, but it is said that these did not prevent the relationship being open and fair nor did they amount to unlawful and inappropriate threats, and it is said that the allegations made as to fraudulent misrepresentation and threats bear no resemblance either to what happened or to what Mr Holyoake understood to be happening.

The Claimants have brought this application for an injunction because of concerns they have that the Defendants may make it difficult or impossible to enforce judgment against them if they are successful in the action. They have not however sought at this stage a freezing injunction; they have limited themselves to what might be called a "notification injunction" requiring the Defendants to notify them before disposing or dealing with their assets. As Mr Trace QC, who appears for the Claimants, put it, in doing so they contend that they are seeking no more relief than they consider reasonably necessary to protect their position, the primary purpose being that if the Defendants should attempt to enter into a transaction or transactions which the Claimants consider seriously damaging to their position, the Claimants will have the opportunity to apply to Court for a freezing injunction or take other steps to protect themselves.

Jurisdiction

Mr McQuater QC, who appeared for the Defendants, argued that a notification injunction of the type sought was contrary to principle, and I was referred, albeit briefly, to a large number of authorities on both sides on the question whether a...