Michael Wilson & Partners Ltd v Thomas Ian Sinclair
| Jurisdiction | England & Wales |
| Judge | Pelling |
| Judgment Date | 22 May 2020 |
| Neutral Citation | [2020] EWHC 1249 (Comm) |
| Court | Queen's Bench Division (Commercial Court) |
| Docket Number | Case No: CL-2010-000804 |
| Date | 22 May 2020 |
[2020] EWHC 1249 (Comm)
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
COMMERCIAL COURT (QBD)
Royal Courts of Justice, Rolls Building
Fetter Lane, London, EC4A 1NL
HIS HONOUR JUDGE Pelling QC
SITTING AS A JUDGE OF THE HIGH COURT
Case No: CL-2010-000804
Mr David Holland QC (instructed under the Public Access Scheme) for the Appellant
Mr Philip Shepherd QC (instructed by Kerman & Co, Solicitors) for the Fifth Respondent
The first to Fourth Respondents did not appear and were not represented.
Hearing dates: 12 May 2020
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.
HIS HONOUR JUDGE Pelling QC SITTING AS A JUDGE OF THE HIGH COURT
HH Judge Pelling QC:
Introduction
This is the hearing of an appeal by the Appellant (“MWP”) from an Order of Mr Registrar Kay QC made as long ago as the 14 June 2018 by which he refused an application by the claimant to make final an Interim Third Party Debt Order.
Permission to appeal was granted by Males J by an order made on 23 August 2018. It is worth noting that a large number of different grounds were relied on in the Grounds and the supporting skeleton argument, most of which were no longer relevant and not relied on at the hearing before me. Many of the Grounds relied on concerned apparent contradictions between what Mr Registrar Kay had decided in his judgment leading to the Order under appeal and what had been considered and decided in a judgment under appeal to the Court of Appeal to which I refer in more detail below. This point was summarised in the skeleton submitted with the application for permission in these terms:
“8. At the instance of TP (the forth respondent to this appeal), the Court was persuaded and did find that C's expenditure on legal fees fell under a paragraph of the said freezing order, but that it had breached the freezing order by failing to notify TP of the origin of funds expended. This finding is directly contrary to the express terms of the order of another (higher) court in a case between the same parties which was not shown to the court. The order of that other court (Sir Jeremy Cooke, sitting as a Deputy in the Commercial Court) constituted binding authority on the Master, and his decision to the contrary, with or without the authority, is erroneous.
9. The result of this clash is that C is now faced with two completely contradictory rulings on the meaning of the freezing order applying to it, and, in TP's supplementary skeleton argument placed before the Master at the adjourned hearing on the issue of costs and permission to appeal, TP has given notice that it intends to take advantage of the inconsistency.
10. In and of itself such a finding would necessitate an appeal to resolve the discrepancy, but where, as here, the error has arisen in circumstances where TP's counsel raised the point on the second day of the hearing without notice, and failed to provide the court with all relevant material, that constitutes an additional reason to grant permission to appeal, and the order obtained in such circumstances should be suspended pending that appeal, and TP should be deprived of its costs.
…
18. The bizarre situation has now been reached where TP persuaded Sir Jeremy Cooke to hold (and record) that paragraph 13(1) only applies to legal costs in TP's own claim to enforce his Award, and paragraph 13(2) entitles C to fund all other proceedings under the “ ordinary course of business” exception, but he has now, without drawing to the Master's attention the terms of the Cooke Order, the Cooke Ruling and TP's own letter to the Master of 15th July 2017, persuaded the Master to hold the exact opposite of both propositions. Even more extraordinary is this: he has led the Master into finding that paragraph 13(2) of the freezing order cannot cover spending funds on legal costs in the ordinary course of business, and to do so would breach the freezing order, even though TP's counsel earlier in the hearing before the Master expressly disavowed that he was arguing that C was in breach of paragraph 13(2), and conceded the exact opposite, namely that “ the ordinary course of business” exception (13(2)) did include legal expenses”.
In fact however, there were two bases on which Mr Registrar Kay had proceeded. First he had concluded that, as a matter of law, in the circumstances, a Third Party Debt Order could not be granted. Secondly he held that if he was wrong about that, he would have refused to make the Interim Third Party Debt Order (“ITPDO”) final in the exercise of his discretion. The points I have referred to were relevant only to the exercise of discretion but have no impact on the merits or otherwise of the appeal against the decision of the Registrar on the threshold point.
Males J directed that:
“1) Permission to appeal from all of the Judgment and Order of Master Kay QC of 14 June, and also his further Order of 20 July 2018, is hereby granted to MWP, and all such Judgment and Orders shall be stayed pending the final outcome of the Appellant's appeal, with the effect that the Third Party Debt Order of 23 May 2017 shall remain in place, and in full force and effect.
2) The appeal shall be listed to be heard in this Court, time estimate one day, after the handing down of judgment in appeal No.A3/2017/1964 (currently listed to be heard on 24 and 25 October 2018).
3) The Appellant shall provide security for the costs in the appeal in the amount of £75,000, within twenty-eight (28) days of the Appellant's receipt of the sealed Order, failing which the Respondents shall be entitled to apply for the appeal to be struck-out.”
The Court of Appeal case to which Males J referred was the appeal by MWP from the decision of Sir Jeremy Cooke I refer to below. It is a startling feature of this case that notwithstanding that the Court of Appeal handed down its judgment (dismissing MWP's appeal) on 26 February 2019, no attempt has been made by MWP to arrange for the listing of this appeal, which was only listed in the end at my insistence so that it could be determined one way or another. I explain the context of my involvement further below.
It is necessary that I now set this appeal in its wider context. This is one of a number of cases pending in the Commercial Court, many of which have been issued by the Appellant. The conduct of the parties and in particular that of MWP has been the subject of criticism by judges both here and in various overseas jurisdictions in recent years. It is necessary to draw attention only to two statements from the Court of Appeal in England that illustrate the nature of the problem. Both were made when the Court of Appeal dismissed MWP's appeal from the order of Sir Jeremy Cooke removing an “ Angel Bell” exception from a post judgment freezing order — see Michael Wilson & Partners Limited v. Emmott [2019] EWCA Civ 219. The lead judgment was given by Gross LJ. At Para. 2 of his judgment, he described these proceedings as a “… seemingly interminable, unhappy, … saga”. Having described the background in terms that I intend to adopt for the purposes of this judgment and which I set out below, Gross LJ concluded that section of his judgment at para. 25 by saying of the findings of the first instance judge, that they were “ …coruscating factual conclusions; they comprise a devastating indictment of the conduct of MWP and Mr Wilson.”. In a concurring judgment, Jackson LJ said:
“Having listened to the history of the litigation between these two solicitors, I protest at the shameful waste of time and money caused by their private dispute, which has now continued for 13 years and left their reputations in tatters. We were told that Mr Emmott's global costs amount to £2.5 million, and Mr Wilson's several times that. Courts in four countries have been (and in at least two cases are being, with no end in sight) plagued with their proceedings and counter-proceedings. It appears that Mr Wilson will stop at nothing to prevent Mr Emmott from receiving the award to which, for all his deceit, he is entitled. Against that background, the robust and principled approach taken by Sir Jeremy Cooke was entirely appropriate. Any court in this jurisdiction that has to consider this dispute in future would do well to remember that the overriding objective in civil proceedings includes a duty on the court to save expense, deal with the case expeditiously and fairly, and allot to it an appropriate share of the court's resources, while taking into account the need to allot resources to other cases; further, that the parties have a duty to help the court to achieve this. This pathological litigation has already consumed far too great a share of the court's resources and if it continues judges will doubtless be astute to allow the parties only an appropriate allotment of court time.”
This criticism has focussed on the disproportionality that has been displayed in the number of claims and applications issued, the invariably prolix manner in which Mr Wilson of MWP chooses to present each application, the vast numbers of documents that he insists be included within each bundle, the vast majority of which are never referred to but which add greatly to the time taken and cost incurred at each hearing, and the lack of merit both factual and legal of...
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