Middlesbrough Football & Athletic Company (1986) Ltd v Earth Energy Investments LLP ((in Liquidation))
| Jurisdiction | England & Wales |
| Judge | Sir Geoffrey Vos |
| Judgment Date | 08 February 2019 |
| Neutral Citation | [2019] EWHC 226 (Ch) |
| Docket Number | Case No: CR-2017-000140 |
| Court | Chancery Division |
| Date | 08 February 2019 |
and
[2019] EWHC 226 (Ch)
Sir Geoffrey Vos, Chancellor of the High Court
Case No: CR-2017-000140
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
INSOLVENCY AND COMPANIES LIST
The Rolls Building
The Royal Courts of Justice
7 Rolls Building, Fetter Lane,
London EC4A 1NL
Mr Paul Millinder appeared in person
Mr Ulick Staunton (instructed by Womble Bond Dickinson (UK) LLP) appeared for Middlesbrough Football & Athletic Company (1986) Limited
Mr Anthony Hannon, Official Receiver, appeared as the liquidator of Earth Energy Investments LLP and Empowering Wind MFC Limited
Hearing date: 22 nd January 2019
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.
Index
| Section | Paragraph |
| Introduction | 1 |
| Mr Millinder's application | 5 |
| Relevant corporate entities | 8 |
| Factual Background | 11 |
| HHJ Pelling's Judgment | 66 |
| Issues | 78 |
| Did HHJ Pelling have jurisdiction to make the ECRO? | 80 |
| Does this Court have jurisdiction to set aside or vary the ECRO, and, if so, how should it exercise that jurisdiction? | 83 |
| The substantive issue: Should the ECRO be set aside on the grounds either that there has been a material change of circumstances since the order was made, or that the facts on which the original decision was made were mis-stated, or on some other basis? | 93 |
| The contractual submissions | 95 |
| The TWM submissions | 131 |
| The non-disclosure submissions | 135 |
| The ECRO | 136 |
| Conclusions | 141 |
Sir Geoffrey Vos, the Chancellor of the High Court:
Introduction
This case arises from the relationship between Mr Paul Millinder (“Mr Millinder”) and his companies on the one hand and Middlesbrough Football & Athletic Company (1986) Limited (“Middlesbrough”) 1 on the other. The background was an arrangement between the two sides for the construction of a wind turbine at Middlesbrough football ground. Sadly, however, the relationship quickly deteriorated, and both sides resorted to litigation. Mr Millinder has tried, again and again, to assert his companies' legal rights against Middlesbrough, and Middlesbrough has resisted those attempts and has sought to wind up Mr Millinder's companies. There has never been any substantive resolution of the underlying contractual issues between the parties, which is regrettable, because, at its foundation, that is what the case is about. Instead, the parties have become enmeshed in a web of procedural and insolvency issues, culminating in the grant of an extended civil restraint order against Mr Millinder personally.
Mr Millinder accepted, in the course of oral argument, that he had made a number of mistakes in his conduct of the litigation. He also came close to conceding that it would have been better if he had in the past avoided the strong language and accusations that characterised his correspondence with court officials, lawyers and judges, as he became more and more frustrated with the situation that faced him.
As will appear from this judgment, this case provides an example of how those making use of limited liability companies for their trade need to understand the consequences of so doing. Once companies are wound up, the directors no longer have control of their affairs. That has been Mr Millinder's problem, but it is one that he seems not, until recently perhaps, fully to have understood.
It is against this background that I have to decide a relatively simple question, namely whether the extended civil restraint order granted against Mr Millinder personally on 28 th June 2018 (the “ECRO”) should be discharged or set aside. Unfortunately to decide this question properly, it is necessary to go into much of the background. I have read some 20 files of papers and had the benefit of a full day of oral argument.
Mr Millinder's application
Mr Millinder issued an application notice on 30 th September 2018 in case number CR-2017-000140 in which he asked the court to make an order pursuant to CPR Part 3(3) (on its own initiative) to “vary and set aside orders accordingly, granting relief appropriately in remedy of miscarriage of justice against the malicious” winding up orders, on the grounds that there should be a determination of fraudulent nondisclosure and misrepresentation (the “Application”).
Despite the precise terms of Mr Millinder's application dated 30 th September 2018, one of his main challenges is to the ECRO that HH Judge Pelling QC had made against him for the reasons given in his judgment of 28 th June 2018 (“HHJ Pelling's judgment”). HHJ Pelling's judgment granted the ECRO on the basis that Mr
Millinder had made, whether on his own behalf or on behalf of one of his companies, a minimum of three applications that had been dismissed and were totally without merit. HHJ Pelling decided, in his discretion, to grant the ECRO against Mr Millinder on the ground that he had consistently refused to take ‘no’ for an answer resulting (a) in repetitious applications and in Middlesbrough incurring significant legal expenses that it would otherwise have avoided, and (b) in the use of public resources that would not otherwise have been needed. He decided that Mr Millinder had disclosed no insight into the vexatious nature of this activity, and that it was highly likely that Mr Millinder would make further applications and write further unpleasant correspondence to pursue the claims of his (former) companies that he was convinced were justified. It may be noted at this stage that Mr Millinder has in fact never appealed any of the decisions that have been made against him. 2The Application also asks the court to set aside orders made by ICC Judge Jones on 26 th March 2018, a winding up order made against Earth Energy Investments LLP (“Earth Energy”) on 28 th March 2018, and to determine that none of Mr Millinder or his companies ever owed any monies to Middlesbrough. As will later appear, the basis on which I directed the hearing that has given rise to this judgment was as an application to discharge the ECRO, made under paragraph 3.2(2) of Practice Direction 3C. No permission has been given under the ECRO for any other applications to be made, though I will need in the course of this judgment to consider aspects of the orders that Mr Millinder seeks to challenge.
Relevant corporate entities
Empowering Wind Limited (“Empowering Wind”) 3 was a company whose directors were Mr Millinder and his brother, Mr Alan John Millinder (“Mr A.J. Millinder”). It was dissolved on 18 th November 2014. The sole shareholder was Mr A. J. Millinder.
Empowering Wind MFC Limited (“Empowering Wind MFC”), 4 was a sole-purpose company that was compulsorily wound up on 19 th September 2016. The two directors of Empowering Wind MFC were Mr Millinder and Mr A.J. Millinder.
Earth Energy was a company incorporated on 28 th April 2014 and compulsorily wound up, as I have said, on 28 th March 2018. Earth Energy held 99% of the shares in Empowering Wind MFC and Mr Millinder held the remaining 1%. Mr Millinder was the sole director of Earth Energy when the winding up began. 5
Factual background
On 7 th July 2008, Middlesbrough was granted planning permission to erect a wind turbine at its Riverside Stadium, subject to a condition requiring the submission of
On 15 th June 2012, Middlesbrough entered into an option agreement with Empowering Wind whereby Middlesbrough granted Empowering Wind an option for a period of 4 months to lease part of its Riverside Stadium (the “Property”) to construct a 90-metre wind turbine (the “wind turbine”) in accordance with the planning permission granted on 7 th July 2008 (the “development”).
Mr Millinder alleges that in November 2012, Northern Powergrid (Northeast) Limited (“Northern Powergrid”) made Middlesbrough aware that a grid connection was conditional on it taking ownership of the dedicated sub-stations at the Property.
On 17 th June 2013, Middlesbrough granted Empowering Wind MFC a lease of the Property for 26 years (the “Lease”) in consideration of a premium of £200,000 (paid on execution). The rent reserved by schedule 7 of the Lease included a capacity rent of £50,000 per annum payable in certain events, which in fact occurred from 17 th June 2014, and the provision by Empowering Wind MFC to Middlesbrough of up to 1,500 megawatt hours of electricity per annum free of charge. Paragraph 3.4 of schedule 5 to the Lease included a binding arbitration clause. The definition of “force majeure” in the Lease and paragraph 6 of schedule 5 to the Lease envisaged that Empowering Wind MFC would be absolved from liability to Middlesbrough caused by any event or circumstance beyond its reasonable control, provided that lack of funds was not to be regarded as a cause beyond Empowering Wind MFC's reasonable control. As will later be seen, Nugee J held on 5 th February 2018 that Middlesbrough's counsel had unwittingly misled Arnold J at a hearing on 9 th January 2017 into thinking there was no relevant provision in the Lease save for the definition of “force majeure”.
It is common ground that on 17 th June 2013 Middlesbrough and Empowering Wind MFC entered into an energy supply agreement (the “ESA”), by which Empowering Wind MFC agreed to supply the energy produced by the wind turbine to be installed at the Property to Middlesbrough...
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