Mr Samir Ramzi Samara (Claimant and Respondent) v (1) MBI & Partners UK Ltd (First Defendant and Appellant) (2) Ajwa RMTI Company (Second Defendant)
| Jurisdiction | England & Wales |
| Judge | Mr Justice Silber |
| Judgment Date | 04 March 2014 |
| Neutral Citation | [2014] EWHC 563 (QB) |
| Docket Number | Case No: HQ 11X01159 |
| Court | Queen's Bench Division |
| Date | 04 March 2014 |
[2014] EWHC 563 (QB)
QUEEN'S BENCH DIVISION
ON APPEAL FROM THE HIGH COURT OF JUSTICE
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr Justice Silber
Case No: HQ 11X01159
Appeal No: QB/2013/0436
Sam Neaman (instructed by Ferguson) for the Claimant/Respondent
Derrick Dale QC and Rebecca Loveridge (instructed by Trowers and Hamlin LLP) for the First Defendant/Appellant
The Second Defendant was not represented or present
Hearing date: 7 February 2014
Further written submissions served on 12 February 2014
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.
I. Introduction
By an order dated 23 July 2013, Master Fontaine declined to set aside a default judgment entered by Mr Samir Samara ("the Claimant") against MBI & Partners U.K. Limited ("the First Defendant"). The First Defendant sought to appeal. Permission to pursue its appeal was given by Bean J after it had been refused on paper by Openshaw J.
This appeal raises an issue as to how, if at all, the Court's attitude to applications to set aside a judgment entered in default have been altered by the proposals made by Sir Rupert Jackson and the subsequent consequential changes to the CPR. I will also consider the position under the pre-existing rules.
This claim has become part of a substantial dispute between the parties because the First Defendant has also made an application after the hearing in front of the Master but which is not before me to have the Claimant's claim struck out as an abuse of process. Its first ground is that the alleged contract relied upon by the Claimant is a fraudulent claim; while its second ground is that there was no such agreement between the parties for the employment of the Claimant by the First Defendant pursuant to the contract, which was the subject-matter of the claim and which led to the default judgment of Master Fontaine and the unsuccessful application to set aside that judgment from which I am hearing the appeal. On 30 January 2004, Cooke J heard this application and he gave directions so that this claim raised by the First Defendant ("the fraud claim") will be tried in due course by a High Court Judge. The First Defendant has paid into Court the amount of the judgment debt.
In this appeal, I am, in fact, being asked to determine whether the First Defendant should be able to rely in the fraud claim on a limitation defence, which is separate and different from the fraud claim and which was raised in the draft Defence of the First Defendant, but which cannot now be pursued because of the decision under appeal refusing to set aside the judgment.
II. The Nature and History of the Claim
The Claimant, who is a national of the United States, entered into two employment contracts with each of the Defendants dated 8 December 2001. In the first agreement ("the AJWA contract"), it was agreed that the Second Defendant would employ the Claimant as General Manager in Saudi Arabia.
The second contract ("the MBI contract") was made between the Claimant and both the Defendants under which the Second Defendant would lend the services of the Claimant to the First Defendant. The Defendants are separate companies, but Sheikh Mohammed Bin Issa Al Jaber is the Chairman of the Second Defendant as well as being the controlling agent of the MBI companies of which the First Defendant is a subsidiary.
The Claimant duly commenced employment with the Defendants. The contention of the Claimant is that he was not paid sums due to him by the First Defendant under the MBI contract and he claimed from the First Defendant the sterling equivalent of the sums due and which amounted to £235,376.60.
Although the alleged date of the Claimant's employment by the First Defendant was from January 2002 to 31 March 2005, the Claim Form was not issued until 29 March 2011, while the Particulars of Claim were only filed and served on 27 July 2011. The First Defendant did not file an Acknowledgment of Service and so the last date on which it had to serve a Defence was 11 August 2011. Neither an Acknowledgment of Service nor a Defence was filed within the time limits prescribed by the CPR or indeed at all.
On 24 August 2011, the solicitors acting for the Claimant requested judgment in default and on 20 September 2011, Master Fontaine gave permission to enter judgment against the First Defendant in default. The Master asked for a draft order and draft judgment to be supplied and this was provided on 27 September 2011. On 19 December 2011, the Claimant's solicitors wrote to the Court requesting a hearing for the purposes of summary assessment of their costs. The hearing was fixed for 13 February 2012 and notice of the hearing was given to the First Defendant on 20 January 2012. On 23 January 2012, Mr Salfiti, who was the First Defendant's in-house lawyer, spoke to Miss Randall, the Claimant's solicitor, and she explained that the judgment in default had not been entered and that was why the hearing had been listed for 13 February 2012. Mr. Saltifi asked if the Claimant would agree to the First Defendant filing a Defence out of time, but Miss Randall replied that she would not agree to this. Another telephone discussion took place on 10 February 2012 relating to the forthcoming hearing.
At the hearing on 13 February 2012, which was attended by Miss Randall and Mr Salfiti, and after hearing submissions from both sides, Master Fontaine entered judgment against the First Defendant in favour of the Claimant in the sum of £363,421.47 and this included interest in the sum of £128,044.87, together with the Claimant's costs which were assessed summarily in the sum of £12,530.20.
On 14 February 2012, a copy of the Order was sent to Mr Salfiti and then to the Master who sealed it. It was then sent on that day by the Claimant's solicitors to Mr Salfiti with a notice saying that if the Defendant failed to make payment within 14 days, then enforcement proceedings would follow.
On 1 March 2012, Mr Salfiti telephoned Miss Randall again stating that First Defendant intended to apply to aside the default judgment. In a follow-up email, Mr Salfiti invited the Claimant to agree to the First Defendant's application to set aside the default judgment, failing which he would invite the Court to consider wasted costs. Miss Randall did not respond and a further email was sent on 7 March 2012. Miss Randall has explained that she was off sick during this period and that she did not want to respond before taking her client's instructions.
On 27 March 2012, Miss Randall returned a telephone call from Mr Salfiti who referred to the emails and said that he did not know if they had been received. Miss Randall explained that she had seen them and that she had not got back to phone him as she wished to speak to her client first. Of that telephone call, Miss Randall says, according to her witness statement, that:-
"I am satisfied that it was clear to Mr Salfiti that although I endeavoured to speak to my client, it was a matter for him whether he made the application or not and, if so, when".
On the same day after that telephone conversation, Miss Randall sent an email to Mr Salfiti stating that:-
"I am writing to acknowledge receipt of your email below. I will be taking instructions from my client on the contents of your email".
Nothing further happened for over a year until 16 May 2013, when the High Court Enforcement Officers attended the offices of the First Defendant to take steps to enforce the judgment. At that point, Mr Salfiti attempted to contact Miss Randal who was out of the office. He emailed and telephoned the firm and said that he needed to speak with Miss Randall urgently about an injunction.
Miss Randall, who was still out of the office, arranged for a senior partner at her firm, Mr Charles Ferguson, to return the telephone calls from the High Court Enforcement Officer and Mr Salfiti. Mr Ferguson spoke to both of them on 16 May 2013 at about noon. Mr Salfiti did not refer to a pending injunction application and Mr Ferguson agreed that he would instruct the High Court Enforcement Officers to take no further steps in relation to the enforcement of the judgment against the First Defendant on the understanding that the First Defendant would make an application to set aside the default judgment and that he would serve it by 4.30pm on 21 May 2013. Accordingly Mr Ferguson telephoned the High Court Enforcement Officer at 12.46pm and he instructed the officer to hold off enforcing the judgment until after that time in accordance with that agreement.
Nevertheless on that day and very surprisingly, the First Defendant made an application for a stay of enforcement and for a stay of the default judgment, Singh J then heard a without notice application by the First Defendant for an injunction preventing the Claimant form enforcing the judgment under penalty of imprisonment. He granted the order, which was served on 17 May 2013.
A witness statement of Mr Salfiti was adduced before Singh J but Miss Randall disputes many of the statements made by him. Most of the statements are not relevant to the present appeal except for the fact Miss Randall makes it very clear that she told Mr Salfiti on about 27 March 2012 that it was a matter for the First Defendants whether or not they wanted to apply to set aside the default judgment because it was not for the Claimant to agree whether it should be set aside as that was a matter for the Court. She also says first, that there was no...
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