Mrs Nebahat Evyat Isbilen v Mr Selman Turk
| Jurisdiction | England & Wales |
| Judge | Stuart Isaacs |
| Judgment Date | 20 December 2021 |
| Neutral Citation | [2021] EWHC 3425 (Ch) |
| Docket Number | Claim No: BL-2021-000365 |
| Court | Chancery Division |
[2021] EWHC 3425 (Ch)
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
BUSINESS LIST (ChD)
Royal Courts of Justice, Rolls Building
Fetter Lane, London, EC4A 1NL
Stuart Isaacs QC (sitting as a Deputy Judge of the High Court)
Claim No: BL-2021-000365
Mr Dan McCourt Fritz and Mr Tim Benham-Mirando (instructed by Peters & Peters Solicitors LLP) appeared on behalf of the Claimant.
The 1 st Defendant appeared in person.
Hearing date: 14 and 15 December 2021
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.
Stuart Isaacs QC:
Introduction
The claimant is an elderly Turkish lady. By a claim form issued on 8 March 2021, she began the present proceedings against the defendants in which she alleges that she entrusted the 1 st defendant (“Mr Turk”) with effective control as her trustee or agent of at least USD 87.5 million of her funds. The claim form alleges that Mr Turk dishonestly and systematically breached his fiduciary duty owed to her and is liable in deceit in respect of a number of agreements and transactions which he induced her to enter into. The claimant claims against him inter alia an account of profits, a declaration as to her beneficial entitlement to a purported loan of USD5 million made by him to himself or its traceable profits, equitable compensation and damages.
The claim form seeks relief against the other defendants as the recipients of the claimant's funds. Her primary claims against 2 nd, 4 th and 5 th defendants (respectively “SG Financial”, “SGAM” and “SG Partners”) are in knowing receipt; she also claims against SGAM and SG Partners in deceit and brings proprietary and restitutionary claims against the 2 nd to 6 th defendants.
Mr Turk served a defence dated 25 June 2021 in which he vigorously denies the claims against him. SG Financial and SGAM served a defence dated 12 August 2021 also disputing the claims against them. SG and SGAM indicated, by their solicitors' letter dated 26 November 2021, that they would not be participating in the present hearing. The 3 rd defendant (“Barton”), SG Partners and the 6 th defendant (“AET Global”) did not enter appearances to the claim and have taken no part in the present proceedings.
At the hearing which has taken place before me, the claimant applies for:
(1) permission to (a) amend the claim form and particulars of claim; (b) add new defendants whom she alleges received traceable proceeds of her assets; (c) rely for those purposes and in support of her claims on evidence given by Mr Turk in cross-examination at a hearing on 20 April 2021; and (d) serve the amended claim form and particulars of claim, together with any order made on the application and any further necessary documents out of the jurisdiction in Jersey on the proposed 7 th defendant (“Forten Holdings”) (application notice dated 3 June 2021);
(2) disclosure by Mr Turk of various bank statements and related relief (the “Disclosure Application”) (application notice dated 21 July 2021);
(3) an order for alternative service (application notice dated 30 November 2021); and
(4) an order striking out Mr Turk's application (application notice dated 2 December 2021).
Mr Turk applies for reverse summary judgment on the claims against him or an order striking out certain paragraphs of the particulars of claim (application notice dated 2 July 2021).
SG Financial and SGAM do not oppose the applications for permission to amend the claim form and particulars of claim and to add new defendants whom the claimant alleges received traceable proceeds of her assets (together, the “Amendment Applications”). Prior to the service by Mr Turk of written submissions on the afternoon before the hearing, at which Mr Turk appeared in person, he did not indicate his position with regard to the Amendment Applications. Those written submissions addressed only Mr Turk's application. In relation to the other applications before the court, the written submissions stated only that Mr Turk opposed them, without any elaboration of the grounds for his opposition.
In his written submissions, Mr Turk also asked the court to permit him to be assisted by a Mr John Bechelet, a partner in his former solicitors, Bivonas Law LLP (“Bivonas”) as a McKenzie friend. The claimant, without accepting that Mr Bechelet met the requirements of a McKenzie friend, conceded that Mr Bechelet should be permitted to address the court and the hearing proceeded on that basis, with both Mr Turk and Mr Bechelet making oral submissions. The claimant's concern as to whether Mr Bechelet was able to act as a McKenzie friend primarily related to whether he maintained an interest in the proceedings as a partner in Bivonas. To address that concern, I directed that Mr Bechelet should disclose the extent of any interest in the proceedings by reference to the matters raised in paragraph 17 of the claimant's supplemental note served on 14 December 2021 in response to Mr Turk's written submissions.
The Amendment Applications
The basis for the Amendment Applications appears from the first witness statement dated 3 June 2021 and fourth witness statement dated 3 November 2021 of Jonathan Tickner, a partner in the claimant's firm of solicitors. The proposed amendments reflect new information obtained by the claimant, in particular as the result of (i) material provided by Mr Turk pursuant to his disclosure obligations under an order made by Miles J on 4 March 2021 granting a worldwide freezing order (the “WFO”) and disclosure orders against him so as to enable the claimant to know the whereabouts of her money or its traceable proceeds; (ii) an affidavit dated 22 March 2021 sworn by Mr Turk in which he identified Forten Holdings and the proposed 8 th defendant (“Forten”) as possible recipients of traceable proceeds; (iii) Mr Turk's evidence in cross-examination at a hearing on 20 April 2021; (iv) information provided by Bivonas on 4 May 2021 which further identified the proposed 9 th defendant (“Heyman”) as a possible recipient of traceable funds; (v) successful court applications by the claimant in the British Virgin Islands against Barton and in the Cayman Islands against SGAM and SG Partners for documentary and affidavit evidence; and (vi) evidence relating to the proposed 10 th defendant (“Mr Lewis”) described in Mr Tickner's fourth witness statement.
As a result of that information, by the Amendment Applications the claimant seeks to add allegations against Mr Turk that she was induced to enter into the agreements and transactions relied on as the result of undue influence exerted by him and that he received traceable proceeds from Barton; to advance her primary claim against Barton and each of the proposed additional defendants as well as against SG Financial and SGP; and to allege deceit against Barton as well as against SGAM and SGP. She seeks expanded relief in respect of those claims against the defendants and proposed additional defendants.
As I have mentioned, SG Financial and SGAM do not oppose the Amendment Applications. Mr Turk submitted at the hearing that the proposed new claim for undue influence was not maintainable as a matter of law and so he objected to it. According to Mr Turk, the undue influence claim had no real prospect of success. In relation to the other proposed amendments, he stated that he did not object to any of them. However, during the course of his submissions on his summary judgment/strike out application, he added that he also objected to the proposed expansion of paragraph 111 of the particulars of claim which, in its original form, states that “So far as Mrs Isbilen is aware, Barton provided no consideration for the payments that it received out of her funds.”
The principles applicable to the grant of permission to amend a statement of case are well-known, were not disputed by Mr Turk and do not require detailed elaboration. In deciding whether or not to exercise its discretion to grant permission to amend, the court must strike a balance between the injustice to the applicant if the application is refused and the injustice to the opposing party and other litigants in general if the application is granted. A key consideration is whether the proposed amendment has any real prospect of success or, in other words, that the allegation made by the proposed amendment is not fanciful, see for example ED&F Man Liquid Products v Patel [2003] EWCA Civ 472. On the question whether or not a new party should be added to a claim, CPR 19.2 provides that the court may order a person to be added as a new party if it is desirable to do so in order that the court can resolve all the matters in dispute in the proceedings; or there is an issue involving the new party and an existing party which is connected to the matters in dispute in the proceedings and it is desirable to add the new party so that the court can resolve that issue.
With the exception of the undue influence allegation and the addition to paragraph 111 of the particulars of claim, which Mr Turk opposes, none of the proposed amendments is opposed. I accept the claimant's...
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