Sean Lindsay v Jared Michael O'Loughnane
| Jurisdiction | England & Wales |
| Judge | Mr Simon Birt |
| Judgment Date | 14 July 2022 |
| Neutral Citation | [2022] EWHC 1829 (QB) |
| Court | Queen's Bench Division |
| Docket Number | Case No: QB-2009-000127 |
and
[2022] EWHC 1829 (QB)
Mr Simon Birt QC
(Sitting as a Deputy Judge of the High Court)
Case No: QB-2009-000127
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr Brian Hurst (directly instructed) for the Claimant
The Defendant appeared in person
The Third Parties did not appear
Hearing date: 13 June 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.
This judgment was handed down by the Judge remotely by circulation to the parties' representatives by email and release to The National Archives. The date and time for hand-down is deemed to be 10.00am on 14 July 2022.
Mr Simon Birt QC:
Introduction
This application represents the latest engagement in a long-running battle between the Claimant, Mr Sean Lindsay, and the Defendant, Mr Jared O'Loughnane. Following a trial in 2010, Mr O'Loughnane was ordered to pay substantial amounts to Mr Lindsay, both by way of damages and in respect of the costs of the action. Those amounts have largely gone unpaid, though Mr Lindsay has managed to recover some of the judgment debt owed to him by way of enforcement. This application represents an attempt by Mr Lindsay to recover amounts from pension funds held in the name of Mr O'Loughnane towards the outstanding judgment debt.
At the hearing before me (held via Microsoft Teams), Mr Lindsay was represented by Mr Hurst (instructed on a direct access basis) and Mr O'Loughnane appeared in person.
Background – the trial and the judgment of Flaux J
The dispute has its origins in the matters set out in the Judgment of Flaux J (as he then was), dated 18 March 2010: [2010] EWHC 529 (QB); [2012] B.C.C. 153 (“ the 2010 Judgment”).
In brief summary, Mr O'Loughnane was the managing director and majority shareholder of a company engaged in currency conversion called FX Solutions Ltd (“ FX Solutions”). Mr Lindsay engaged in a number of foreign exchange transactions with FX Solutions for the purpose of transferring euros abroad.
Under the company's standard terms and conditions, money which was paid to it by clients was held on trust pending the purchase of the relevant foreign currency. The company began to experience financial difficulties and was unable to pay its debts. Nevertheless, Mr O'Loughnane accepted instructions from Mr Lindsay to conduct three transactions in June and August 2008 and two transactions in September 2008 to convert sterling to euros.
In the June-August transactions the euros were received into Mr Lindsay's foreign bank account late. The excuse that Mr Lindsay was given was that the delay had been due to the inefficiency of the bankers. That was untrue. The real reason “ was that by mid May 2008 at the very latest and in any event before the trades in June and August 2008, FX Solutions was hopelessly insolvent, unable to pay its debts as they fell due” something that “ was known to [Mr O'Loughnane] before those trades took place” (2010 Judgment, paragraph 7). Mr Lindsay's money was not kept in the trading account of FX Solutions on trust for him pending the purchase of the foreign currency, but rather “ unbeknownst to [Mr Lindsay] his money was used to pay other creditors of FX Solutions or business and other expenses of FX Solutions and [Mr O'Loughnane] in an illegitimate manner …” (2010 Judgment, paragraph 8).
Mr Lindsay paid £565,000 to FX Solutions in September 2008 for conversion into euros, which were then to be transferred to his bank account in Corfu. The conversion was not made and the transfer was not effected. On 18 September 2008, FX Solutions went into administration and, in due course, into liquidation.
Mr Lindsay was one of the major creditors of FX Solutions in the liquidation, and he has made a recovery in the liquidation, as noted further below.
Flaux J held Mr O'Loughnane liable in deceit, for the reasons set out fully in the 2010 Judgment, and (in an order also dated 18 March 2010) ordered him to pay to Mr Lindsay:
(1) £565,000 plus interest, at 2% above the Bank of England base rate, from September 2008 to 18 March 2010; with interest at the Judgments Act rate thereafter. This was subject to a deduction for any amount that Mr Lindsay managed to recover through the liquidation of FX Solutions.
(2) The costs of the action on the indemnity basis. A payment on account of those costs was ordered in the sum of £495,000.
In the 2010 Judgment, Flaux J set out the following in relation to Mr O'Loughnane's evidence at the trial:
“16. The contrast between the claimant [Mr Lindsay] and the defendant [Mr O'Loughnane] as witnesses could not be greater. The defendant's demeanour in the witness box was arrogant and shameless, in the sense that he was prepared to lie and did lie about the essential issues in the case. He lied about the extent to which he was aware of the hole in FX's accounts and appreciated the company was insolvent, seeking to blame Mr Barnett for never having provided a clear explanation of the hole. The truth is that he was well aware of the hole having improperly used client monies from the trading account over some considerable period of time and permitted his friend Mr Leahy to do so, effectively using it as a personal bank account.
17. Equally, he lied about the extent to which he was involved in or at the very least aware of the trades with the claimant. In particular, he lied about the fact that a critical email from his work email address had been sent by him on 30 June 2008, maintaining the absurd fiction that he had been working at home that day, where there was no remote access, notwithstanding that a number of emails sent from his work email address that day can only have come from him. Overall, I accept the submission of Mr Maclean that I should reject the defendant's evidence, save to the extent that it is corroborated by other independent evidence.”
Since then, Mr Lindsay has made various efforts to seek to collect the judgment sums due to him. I was told that Mr O'Loughnane has paid no part of the outstanding sums voluntarily. Some recovery has, however, been made from various sources, and further efforts are continuing, as I note below. Mr Loughnane now (since around 2009) resides in the USA.
I also add that a freezing order was made against Mr O'Loughnane on 19 February 2009, relating to his assets within England and Wales up to the value of £700,000. It was made without notice, and I was not shown any subsequent orders expressly continuing that order, but was told that the order remains in place.
Enforcement to date
I was not given a definitive account in relation to each of the sums recovered thus far, but was told they have mainly included sums received by way of the sale of properties against which Mr Lindsay had registered charging orders following the judgment, as well as reduction of the judgment debt by way of recovery by Mr Lindsay of an amount of £82,080.72 in the liquidation of FX Solutions. I was told that the total recovered to date by Mr Lindsay from all sources (including from the FX Solutions liquidation) was £309,988.57.
There remain a number of properties, against which Mr Lindsay registered charging orders, and which have been sold and the sale proceeds paid into court, but in respect of which there are other claims. Mr Hurst told me that there are other on-going proceedings to deal with entitlement to those proceeds of sale, with the other competing charge-holders being (so Mr Lindsay says) individuals who are family and/or friends of Mr O'Loughnane and who were granted charging orders over the properties by Mr O'Loughnane after the judgment had been given against him. Those allegations are the subject of those other proceedings and I say no more about them. If Mr Lindsay is wholly successful in those proceedings, that will result in the judgment debt being reduced by a further sum of £190,000.
Even if Mr Lindsay were to be wholly successful in those proceedings, there would therefore still remain a substantial amount outstanding in relation to the judgment debt. The principal amount due as at 19 March 2010 was £1,089,723.20 (being £565,000 in damages, plus an amount of pre-judgment interest, and the payment on account of costs of £495,000). Judgments Act interest at 8% per annum ran on so much of that amount as remained outstanding from time to time.
Current application
As a result of the above, Mr Lindsay continues to pursue enforcement of the judgment in his favour for the remaining amounts due. The current application seeks to enforce against pension funds held in Mr O'Loughnane's name.
The pensions in question are:
(1) One policy with the First Third Party (“ Prudential”) with a transfer value as at 5 November 2020 of £13,516.02.
(2) Two policies held with the Second Third Party (“ Royal London”). Their transfer values as at 29 September 2020 were £38,487.97 and £1,201.90 respectively.
(3) One policy held with the Third Third Party (“ Aegon”). Its estimated value as at 5 October 2020 was £5,368.50.
Each of the above pension providers had sent letters which were provided to me confirming the above information as well as other details about the policies. The terms of the pension policies themselves were not provided. None of the pension providers appeared at the hearing.
Each of these pensions is a Personal Pension Plan. The Aegon plan had formerly been an Occupational Pension Scheme, whose trustees took out the current plan when the Occupational Pension Scheme was...
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