Hope Capital 2 Ltd v Stephen Michael Jones

JurisdictionEngland & Wales
JudgeRichard Spearman
Judgment Date05 June 2024
Neutral Citation[2024] EWHC 1308 (Ch)
CourtChancery Division
Docket NumberCase No: CH-2023-000009
Hope Capital 2 Limited
Stephen Michael Jones

[2024] EWHC 1308 (Ch)


Richard Spearman K.C.

(Sitting as a Deputy Judge of the Chancery Division)

Case No: CH-2023-000009





Royal Courts of Justice

Strand, London, WC2A 2LL

Damian Falkowski and Dr Anton van Dellen (instructed on Direct Access) for the Defendant

Andrew Vinson (instructed by Prosperity Law LLP) for the Claimant

Hearing date: 24 April 2024

This judgment was handed down remotely by circulation to the parties' representatives by email, release to Bailii and publication on the Courts and Tribunals Judiciary website. The date and time for hand-down is deemed to be 10:30am on 5 June 2024.

Richard Spearman K.C.:


This is an appeal against the Order of Master Clark dated 21 December 2022, granting summary judgment in favour of the Claimant in the sum of £2,585,723.37 inclusive of interest to 21 December 2022, and continuing at a daily rate of £554.78. It comes before the Court pursuant to the Order of the Honourable Mrs Justice Bacon DBE dated 28 July 2023, which was made upon the Defendant's renewed oral application for permission to appeal. The Grounds of Appeal advanced on behalf of the Defendant before Bacon J related to a range of topics, and as originally formulated they did not include the sole grounds upon which Bacon J was prepared to grant permission to appeal, which were added to those Grounds of Appeal by amendment. By paragraph 1 of her Order, Bacon J ordered “Permission granted to the [Defendant] to amend the Grounds of Appeal in the form attached to this Order”, and by paragraph 2 she ordered:

“The application for permission to appeal is granted solely in respect of whether, as to the New Agreement, the Judge erred when she (a) held that the [Defendant] did not have a real prospect of success on the issue of whether the New Agreement varied or discharged any of the provisions of the agreements relied upon by the [Claimant] in its Particulars of Claim; and (b) did not adequately consider whether further evidence might become available which would materially assist the Court in deciding the litigation when considering whether the New Agreement might be disclosed by the [Claimant].”


In the amended Grounds of Appeal attached to the Order of Bacon J, all the original text was struck out, save for some introductory paragraphs including that “In October 2018 the [Claimant] entered into a Deed of Guarantee and Indemnity (“the PG”) in respect of a loan agreement of £2.1 million (“the Loan Agreement”) made to a property development company of which the [Defendant] and one Alexander Collier were Directors” and “The company did not repay the loan on the date when repayment fell due i.e. 29 April 2019”. In addition to those paragraphs, and the Grounds of Appeal identified in paragraph 2 of the Order of Bacon J, the following paragraphs were added by amendment, which laid the foundation for those particular Grounds of Appeal: “The [Defendant] alleges that a new agreement was entered into by the [Claimant] after the Loan Agreement and Deed of Guarantee and Indemnity which had the effect of varying obligations under the Loan Agreement and/or the PG” and “The [Claimant's] Chief Executive Officer has stated in a witness statement dated 17 August 2021 at paragraph 41 (sic) that the [Claimant] had agreed to grant additional security and agreed to defer enforcement. The [Defendant's] position is that this constitutes the New Agreement.”


The background to the appeal can be taken substantially from the judgment of Master Clark, who, first, explained the parties and the claim as follows:

“2. The claimant is a specialist provider of business loans. The defendant was at all material times a director of a company called Sphere Property 2 Limited (“the company”). His co-director was Alexander Collier.

3. The company owned the freehold properties known as:

(1) 18 Balcombe Road, Poole BH13 6DY (Title Number DT261185); and

(2) 18a Balcombe Road, Poole BH13 6DY (Title Number DT409305); (together, “the Properties”).

4. In October 2018, the claimant entered into a suite of agreements (“the Agreements”) including a loan agreement (“the loan agreement”) with the company under which it provided a loan of £2.1 million (“the loan”) to the company, secured on the Properties. In support of the loan, the defendant and Mr Collier entered into a Deed of Guarantee and Indemnity dated 29 October 2018 (“the Guarantee”).

5. The following facts are common ground:

(1) The loan fell due on 29 April 2019;

(2) The company failed to make payment of any of the loan on the due date;

(3) The amount of the loan has been reduced by the sale of the Properties by LPA receivers appointed for that purpose;

(4) Substantial sums remain outstanding;

(5) The claimant has demanded payment from the defendant under the Guarantee;

(6) The defendant has failed to pay.

6. On 20 January 2020 another company in which Mr Collier was (and remains) the sole director, Sphere Property 3 Ltd (‘Sphere 3’), entered into a second charge (“the second charge”) in favour of the claimant in respect of 20 Balcombe Road, Poole BH13 6DY, in order to provide the claimant with additional security in respect of the company's indebtedness to it. Shortly afterwards, on 15 May 2020, LPA Receivers were also appointed over 20 Balcombe Road, who sold it. The net proceeds of sale were less than the debt owed to the first charge holder, and the claimant did not receive anything in respect of the second charge.

7. The claim is for the balance of the loan due. Of the defences raised by the defendant, it is only necessary to consider those remaining after the order dated 6 July 2022 of Deputy Master Glover striking out parts of the Defence. The defences to be considered fall into two categories: remaining defences raised in the original Defence as filed, and defences raised in the proposed amended Defence.”


At paragraphs 8 and 9 of her judgment, Master Clark summarised the various defences which the Defendant relied upon at that time. As set out at paragraph 9(3), these included that “The claimant and Mr Collier entered into a new loan agreement which the defendant was informed replaced the loan agreement: ¶23 Defence”.


Master Clark then summarised the procedural chronology as follows:

“11. The claim was issued on 29 April 2021. The Defence was filed on 25 June 2021. The application was issued on 10 September 2021. It was supported by a witness statement dated 17 August 2021 (“Sealey 1”) of Robert Sealey, the Chief Executive Officer of the claimant.

12. The defendant filed and served his evidence in opposition to the application (“Jones 1”) on 7 February 2022.

13. The first hearing of the application was listed on 14 February 2022, but was vacated (because the claimant's counsel had Covid). The first effective hearing was before Deputy Master Glover on 6 July 2022. At that hearing the defendant's counsel made an oral application to adjourn the hearing to enable him (as recorded in the order) to seek permission to amend his Defence in order to incorporate the allegations contained in paragraphs 45 and 46 of Jones 1 (discussed in paras 41 to 54 below), and to join additional parties.

14. On 20 July 2022 the defendant served upon the claimant a draft amended Defence. No application to amend the Defence in accordance with the draft was made at that stage.

15. On 27 July 2022 the defendant issued an application notice seeking to join 4 additional parties, and bring additional claims against them. The draft statement of case attached to the application notice included the proposed amendments in the draft amended Defence served on 20 July 2022; and the claimant was a respondent to the application. However, the application did not formally seek permission to amend the Defence at all. That application was not listed (and is therefore not before me today), apparently because the defendant did not respond to the court's directions that he file the parties' agreed dates and agreed time estimates for the hearing and pre-reading. It is unclear whether it has been served on the proposed additional parties.

16. On 11 November 2022, 7 days before the hearing before me, the defendant issued a further application seeking only to amend the Defence (and not to add additional parties); and to add a counterclaim alleging misrepresentation and/or breach of duty, and seeking rescission of the Guarantee, alternatively damages. The proposed amended Defence and Counterclaim is identical to that in the draft attached to the July application notice, albeit permission was not formally sought at that stage.”


The main procedural events since that time which are of immediate relevance to the appeal that is currently before the Court are as follows:

(1) On 18 January 2023, upon consideration of the Appellant's Notice and Grounds of Appeal filed by the Defendant on 11 January 2023 and the approved judgment and order of Master Clark dated 21 December 2022, Leech J allowed the Defendant's application for a stay of execution of the Order of Master Clark until the determination of the Defendant's application for permission to appeal.

(2) By Order dated 10 February 2023, Leech J varied his Order of 18 January 2023 so as to permit the Claimant to proceed to enforce the Order of Master Clark dated 21 December 2022 by applying to continue the interim charging order relating to the Defendant's home that had been served on the Defendant on 18 January 2023 (but not otherwise), essentially on the grounds that there was no real prospect that the Claimant would be able to obtain an order for sale and possession of that property “before the Court has determined the application for permission to appeal (or,...

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