Louise Hewlett Fyfe (suing by her deputy and litigation friend the Reverend Rebecca Harriet Watts) v John Harris Watts and Others
| Jurisdiction | England & Wales |
| Judge | Alison Foster |
| Judgment Date | 30 May 2013 |
| Neutral Citation | [2013] EWHC 1374 (Ch) |
| Docket Number | Case No: HC11CO3544 |
| Court | Chancery Division |
| Date | 30 May 2013 |
[2013] EWHC 1374 (CH)
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
Royal Courts of Justice
Strand, London, WC2A 2LL
Alison Foster QC Sitting as a Deputy Judge of the Chancery Division
Case No: HC11CO3544
Case No: Hc12co4225
Ms Elizabeth Weaver (instructed by Harcus Sinclair, Solicitors) for the claimants
Mr Peter Shaw (instructed by Rickerbys LLP) for the defendants
Hearing dates: 8th May 2013
Alison Foster Qc:
These are the written reasons for an Order I made on 8 th May 2013.
There are two sets of proceedings before the Court, claim No: HC11CO3544 has been known as "the Removal Proceedings" and claim No: HC12CO4225 as "the Mandela Avenue Claim". I shall generally so refer to them here. For ease of reference I refer to John Watts, and/or Yanina Anabell D'Enjoy, and/or Dream Star (Barbados) as "the defendants" or "John Watts"; I refer to Rebecca Watts and Camilla Woodward and Louise Fyfe as "the claimants". This judgment now concerns only the costs of a number of applications in those claims that were before the court for substantive hearing, but which were conceded shortly before the hearing.
The applications made are:
a. The claimants' application for the continuation of a world —wide freezing order and related orders made on 5 th March 2013 by Peter Smith J in the Removal Proceedings and in the Mandela Avenue Claim on a without notice application
b. The defendants' application to strike out the Mandela Avenue claim alternatively for summary judgment
c. The claimants' application for leave to amend the particulars of claim in the Mandela Avenue Claim
As stated, the claimants' applications were conceded by skeleton argument delivered the day before the hearing, and the defendants do not now pursue the application to strike out the claim for summary judgment. However, a brief understanding of the background is necessary for consideration of the remaining costs issues which were contested at some length on behalf of the defendants notwithstanding the concessions made.
Background
Both sets of proceedings principally concern a Trust known as "Louise's Fund". It was constituted by a settlement dated 22 January 1963 whereby certain assets were settled by Geoffrey Watts on discretionary Trusts for beneficiaries including Louise Fyfe (née Watts), and by a Minute dated 31 March 1977 by which the then Trustees of the settlement resolved that various investments would be held in future as two funds, one of which was defined as "Louise's Fund" to be held on Trusts which were primarily for the benefit of Louise. Her daughter Alice, aged 17, is also a beneficiary. The main beneficiaries of Geoffrey Watts' settlements were the four children of the Settlor: John, Rebecca, Louise and Arthur. The last of these, not party to the present proceedings, did himself obtain an injunction some ten years ago against John Watts which has not yet been discharged and is of some relevance to the matters in issue here. There has been some form of litigation between the family members for over ten years, mainly, it appears, referable to allegations concerning the behaviour of John Watts in his role as Trustee.
By Order dated 17 February 2012 in the Removal Proceedings, Master Bowles, on the claimants' application, removed John Watts as the (by then) sole Trustee of the Trust, and appointed as new Trustees, the claimants, the Reverend Rebecca Watts, Louise's sister, and Camilla Woodward, an old family friend of Louise. Certain consequential orders were also made on that date, including that John Watts deliver up relevant Trust documents to the new Trustees. On 24 February 2012 Master Bowles made a further order to the effect that certain property, namely the issued share capital in a company registered in Barbados known as Dream Star Ltd, be vested in the new Trustees and that John Watts deliver up the statutory books and relevant papers belonging to that company to them. John Watts was also ordered to furnish an account of all property comprised in the Trust as at 3 May 1995 to include shares in and property belonging to Dream Star Ltd since its incorporation, and an account of what had become of the property and his dealings with it.
The Mandela Avenue Claim is brought by the new Trustees, Rebecca Watts and Camilla Woodward against John Watts and Yanina Anabell D'Enjoy in respect of an alleged misappropriation of an asset from Louise's Fund, namely a property in Barbados known as Lot 6, Mandela Avenue, Durants Village, Barbados (referred to here as "Mandela Avenue"). It is alleged that John Watts procured the transfer of the property into the name of Yanina d'Enjoy who is John Watts' domestic partner; Mandela Avenue is the address at which John Watts and Yanina d'Enjoy are currently understood to be living. Dream Star Ltd was incorporated in Barbados on 6 May 1999 with John Watts as sole director and, so it is alleged, with the entire share capital forming part of the assets of Louise's Fund. On 22 September 1999 the claimants claim that John Watts caused Dream Star Ltd to purchase Mandela Avenue for the sum of BBD 435,000 with money from Louise's Fund and that, by a conveyance of 14 September 2010 John Watts caused Dream Star Ltd to transfer Mandela Avenue to Yanina d'Enjoy for a stated consideration of BBD 600,000. It is the claimants' case that in fact no consideration of any kind was paid to Dream Star Ltd. By particulars of claim dated 26 October 2012 the claimants relied upon the failure as at that date of John Watts to account for his administration either of Louise's Fund or of Dream Star Ltd. and his failure to account for the assets of the Louise's Fund or of Dream Star Ltd, and have alleged a deliberate breach of Trust on his part. Since the date of issue, further information has become available which the claimants allege renders their case on this issue even stronger.
The two matters came before Peter Smith J, without notice, on 5 March 2013. In the Removal Proceedings, Peter Smith J made a post-judgment world-wide freezing order against John Watts to protect Louise Fyfe's position in relation to costs. Cost Orders had been obtained from Master Bowles on 17 February 2012 and 24 February 2012. In the Mandela Avenue Claim the judge made a world-wide freezing Order against John Watts to prevent dissipation of his assets before judgment and granted an injunction against Ms D'Enjoy to prevent her dealing with Mandela Avenue pending judgment. Compliance with the provision of information was required by 11 March 2013 and its verification on affidavit by 13 March 2013.
As at 19 March 2013 when the matter came before Proudman J there had not been compliance with previous Orders for disclosure nor had evidence been filed.
A disclosure affidavit and a witness statement giving some details have subsequently been filed and also a defence to the Mandela Avenue Claim. No defence at all was put in to the Removal Proceedings which began in 2011 and culminated, as recorded above, in the final orders in February 2012.
On 19 March 2013 the injunctions were continued by Proudman J. Directions as to evidence were made and John Watts was ordered to swear and serve an affidavit providing information and documentation as previously set out in the order of Peter Smith J, namely
(i) information as to all his assets world-wide exceeding £1000 in value whether in his own name or not and whether solely or jointly owned and whether legally or beneficially owned giving the value location and details;
(ii) whether he is or was beneficially interested in account number 42090937 held by Baker Tilly Bristol under the title Client Money Manager Account, and
(iii) a series of information and documents relating to Mandela Avenue including whether the Bajan company known as Dream Star Ltd had sold Mandela Avenue, particulars and dates and, if John Watts asserts he acquired Mandela Avenue beneficially (either himself or through Dream Star) the relevant dates, identity of the vendor etc.
The application before me was the adjourned return date of the freezing order and the related orders originally made by Peter Smith J on 5 March 2013.
The defendants did issue but as stated, very recently withdrew, an application to strike out the Mandela Avenue Claim alternatively for summary judgment on that claim. An application to amend the Mandela Avenue Claim by the claimants adding Dream Star Ltd as a party is not opposed.
It is relevant to note that, to date, in disregard of his core obligations whilst a Trustee, the delivery up of Trust documents and information relating to the Trust to the new Trustees Rebecca Watts and Camilla Woodward, has not taken place, nor has John Watts fulfilled the other terms of the orders against him namely delivery up of the statutory books and materials relating to Dream Star Ltd and the account of property comprised in Louise's Fund at the relevant dates. An order for costs on the standard basis has not been paid, and an order for payment on account of £60,000 has not been paid whether in whole or in part. I understand that Louise Fyfe has recovered some of the costs by enforcing against certain dividends and sums otherwise due to John Watts. A default costs' certificate was obtained on 27 February 2013 in the sum of £122,639.08 of which the sum of £97,599.00 is still outstanding.
No appeal has been lodged against these orders, and no agreement or...
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