Odyssey Re (London) Ltd and Another (Claimants/Appellants) v Oic Run-off Ltd (Formerly Orion Insurance Company Plc)
| Jurisdiction | England & Wales |
| Judgment Date | 13 March 2000 |
| Judgment citation (vLex) | [2000] EWCA Civ J0313-1 |
| Docket Number | QBCMF 99/0512/A3 |
| Court | Court of Appeal (Civil Division) |
| Date | 13 March 2000 |
[2000] EWCA Civ J0313-1
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT
(Mr Justice Langley)
Royal Courts of Justice
Strand
London WC2A 2LL
Lord Justice Nourse
Lord Justice Brooke and
Lord Justice Buxton
QBCMF 99/0512/A3
Mr J Sumption QC and Mr N Calver (instructed by Messrs Clifford Chance, London EC1) appeared on behalf of the Appellant Claimants.
Lord Grabiner QC, Mr A Griffiths, Mrs L Lake and Mr D Jowell (instructed by Messrs Lovells, London EC1) appeared on behalf of the Respondent Defendant.
Introduction
The primary issue in this appeal is one of fact. Did Mr Leslie Sage commit perjury in giving evidence to Hirst J on 20th November 1989 at the trial of an action ("the first action") between Orion Insurance Co Plc and Sphere Drake Insurance PLC? Hirst J found that Mr Sage's evidence was truthful and his finding was upheld by this court (Lloyd and Mann LJJ, Stuart-Smith LJ dissenting); see [1990] 1 Lloyd's Rep. 465 and [1992] 1 Lloyd's Rep. 239. But in later proceedings to which another insurance company was also a party ("the Baloise action") Moore-Bick J found that Mr Sage did commit perjury in giving evidence to Hirst J; see [1998] 1 Lloyd's Rep. (Insurance & Reinsurance) 35. That has resulted in the present action, in which Sphere Drake claims that the judgment of Hirst J should be set aside on the ground that it was procured by fraud. Having found that Mr Sage did not commit perjury in giving evidence to Hirst J, Mr Justice Langley dismissed the action. Against that decision Sphere Drake now appeals. An appeal by Orion against the decision of Moore-Bick J was compromised by an order in the Tomlin form made shortly before the hearing of this appeal started.
At first sight these different findings made by three different judges of the Commercial Court, the cost of which to Sphere Drake, we have been told, is something of the order of US $160m, are perplexing. But it is important to emphasise that the evidence was not the same at each of the three trials. By the time of the trial before Moore-Bick J Mr Sage was dead. On the other hand there was a limited amount of material then available which was not before Hirst J, in particular an affidavit sworn by Mr Sage in 1986 and the oral evidence of Mr M E Burtonshaw. Before Mr Justice Langley there was a vast amount of additional material which was not before Moore-Bick J, in particular the oral evidence of the solicitors and counsel who had acted for Orion in the first action and contemporary documents from the solicitors' files.
Mr Justice Langley gave a very careful judgment running to some 210 pages. Although his decision of the perjury issue in favour of Orion was a sufficient basis for the dismissal of the action, he quite rightly went on to decide three further issues. The second, which he called the attribution issue, was mainly a question of law. He held that even if Mr Sage did commit the alleged perjury, the law required that at least one of those responsible for the management of Orion or the conduct of the litigation on its behalf should have procured him to do so, or at the least relied on his evidence to deceive the court in the knowledge that it was perjured. Having found that Sphere Drake had wholly failed to establish a case of such knowledge on the part of anyone, he decided the attribution issue, like the perjury issue, in favour of Orion. That part of the judge's decision is also attacked by Sphere Drake in this court.
The third issue decided by Mr Justice Langley was the materiality issue. On the footing that he was wrong on the first two issues, he held that Sphere Drake would only be entitled to an order setting aside the judgment of Hirst J if the perjured evidence was such that it entirely changed the aspect of the case. He held, in favour of Sphere Drake, that that test was satisfied on the facts. That part of the judge's decision has not been questioned by Orion in this court. The same can be said of the fourth issue, the election/affirmation issue, which the judge also decided in favour of Sphere Drake.
The facts of the case as they stood before Hirst and Moore-Bick JJ sufficiently appear from their reported judgments. Mr Justice Langley's judgment has not been reported, but the additional evidence before him is referred to in detail in the judgment to be delivered by Lord Justice Brooke. In the circumstances, a further extensive rehearsal of the facts and the evidence is unnecessary. I will confine myself to essentials. Although both Sphere Drake and Orion have changed their names since the hearing before Mr Justice Langley, it is convenient to refer to them by their old names.
The 1975 agreement, the Russell Record and the Flint Note
Mr Sage's evidence was given in reference to a meeting in London on 23rd April 1975 attended by representatives of Sphere and Drake (then separate companies), Sphere's holding company Alexander Howden & Swann Ltd ("Howden"), Orion and a Swiss insurance company which, for brevity, has been referred to simply as Baloise. The representatives of Orion included Mr Sage, who was then a director and its general manager. At that meeting an oral agreement ("the 1975 agreement") was made between Sphere and Drake, Orion and Baloise, its background and purpose being described by Mr Justice Langley as follows:
"Between the mid-1950s and 1975 these companies had been concerned together in various capacities (as pool members, shareholders and reinsurers) in insurance business underwritten in London and by 1975 were engaged in the run-off of that business to which they were exposed in various proportions of some complexity. In 1975 it was believed that estimates could be made for the future run-off of all the business and the April 1975 agreement provided for contributions to be made to those estimates by each company to be paid to the company which was to be responsible for administering the run-off of the particular business in question."
There are extant two documents which purport to record the whole or part of the April 1975 meeting. The first, known as "the Russell Record", is a typed record prepared by Mr C F Russell of Sphere and Drake, circulated some weeks after the meeting and signed by the representatives of the parties, including Mr Sage on behalf of Orion. The second, known as "the Flint Note", is a manuscript note made at the meeting by Mr R J Flint of Sphere and Drake, which was disclosed on discovery in the first action in 1987 but did not attract the attention of Orion's advisers until the beginning of May 1989, some six months before the trial was fixed to start.
The principal issue in the first action was whether the 1975 agreement was made with the intention of creating legal relations and was thus a binding contract. Orion contended that it was not binding and Sphere Drake that it was. Hirst J found that it was not binding. Both before him and at every stage thereafter the Russell Record and the Flint Note have been documents of crucial importance. I refer to them in turn.
The Russell Record is expressed in its heading to be a record of the April 1975 meeting. It starts by listing those present and in attendance who, in addition to Mr Sage, Mr Russell and Mr Flint, included Mr F Baumli of Baloise and Mr W N Rousell and Mr L J Heritage of Orion. Mr R C Comery of Howden is recorded as being in the chair. Paragraph 1 reads:
"The Chairman referred to the meeting of 13th December 1974 which established the principles to govern the run-off of liability attaching to certain continuing accounts of 'Orion' and 'Sphere'. He said that the object of the present meeting was to agree the final figures involved and the basis for cash settlement."
Having referred to an attached memorandum, already circulated, detailing the respective outstanding liabilities at 31st December 1974 and the basis of assessment thereof, paragraph 2 reads:
"After discussion it was agreed by the interested parties:-
(a) that the figures detailed in the schedule attached to the memorandum of 22nd April 1975, represented, subject to the general reservation in para. 3 below, the final liabilities of the parties involved."
Sub-paragraphs (b), (c) and (d) of paragraph 2 provide for the currencies in which the liabilities are to be settled, for settlement to be made in specified percentages between 30th June 1975 and 30th June 1978 and for all settlements to be made through the agency of Howden. Paragraph 3 is in these terms:
"It was understood that the present agreement, as recorded above, did not preclude the re-opening of discussion on the sharing arrangements if actual settlements increased to an extreme degree the commitment of any party as presently calculated and as evidenced in the memorandum attached hereto."
Paragraph 4 notes that statistics recording the development of accounts involved in the agreement will continue to be exchanged if the previously agreed figures become seriously distorted.
The Flint Note starts by recording the date, the time of the meeting (3.00 p.m.) and those attending. The main part of it is written partly in shorthand. The agreed transcription of that part, giving names where initials appear in the original, is as follows:
"Sphere Termination Agreement
LESLIE SAGE Goodwill agreement and not a legal contract
R. C. COMERY (1) Bill Rousell/Charles Russell —Been fair in applying common yardstick. Have...
To continue reading
Request your trial
-
Douglas v Hello! Ltd (No.3)
...could not be attributed to the Hello! Defendants. The only authority dealing with false evidence to which I was referred is Odyssey Re (London) Ltd v OIC Run-Off Ltd (Times Law Reports for 17th March 2000). In that case the claimants sued for an order to set aside an earlier judgment on the......
-
Royal Bank of Scotland Plc v Highland Financial Partners LP
... ... (Odyssey (London) Ltd v OIC Run-Off Ltd (Odyssey), Re ( ... Sphere Drake Insurance plc v Orion Insurance Co plc ( unreported, 11 ... servicer”) is an English registered company. It has taken no active part in the English ... the English courts (or any other court of another member state of the EU or a contracting state of ... ...
-
Fidelity Advisor Series VIII and Others v APP China Group Ltd
...PoliceELR [1982] AC 529 Boswell v Coaks (1894) R 167 Boodsingh v RamnaraceUNK [2003] UKPC 50 Odyssey Re London Ltd v OIC Run-OffUNK [2001] 1 Lloyd's Rep IR 1 Meridian Global Funds Management Asia Ltd v Securities CommissionELR [1995] 2 AC 500 Beddo v Cayzer [2006] EWCA 557 El Ajou v Dollar ......
-
Cinpres Gas Injection Ltd v Melea Ltd
...c) Accordingly the perjured evidence of Hendry was not to be attributed to Ladney. d) As a matter of law, based on the authority of Odyssey v. OIC Run-Off [2000] EWCA Civ 71, Cinpres' claim to the patent must fail by operation of the doctrine of res judicata. Odyssey decided that although t......