Peter Willers v Albert Gubay

JurisdictionEngland & Wales
JudgeMiss Amanda Tipples
Judgment Date15 May 2015
Neutral Citation[2015] EWHC 1315 (Ch)
Docket NumberCase No: HC-2014-001272
CourtChancery Division
Date15 May 2015
Between:
Peter Willers
Claimant
and
Albert Gubay
Defendant

[2015] EWHC 1315 (Ch)

Before:

Miss Amanda Tipples QC

Case No: HC-2014-001272

IN THE HIGH COURT OF JUSTICE

CHANCERY DIVISION

The Royal Courts of Justice

The Rolls Building, Fetter Lane,

London, EC4A 1NL

Mr Hugo Page QC and Mr Adam Chichester-Clark (instructed by De Cruz Solicitors) for the Claimant

Mr Bernard Livesey QC and Miss Alicia Tew (instructed by Laytons Solicitors LLP) for the Defendant

Hearing dates: 18, 19 March 2015

Miss Amanda Tipples QC:

Introduction

1

On 3 March 2014 the claimant issued proceedings against the defendant claiming damages for the tort of malicious prosecution of civil proceedings and interest thereon. The defendant, Mr Gubay, is resident and domiciled in the Isle of Man. These proceedings were served on him, with the permission of the Court, on 26 March 2014. The defendant applied to set aside service on him on grounds that England and Wales was not the appropriate forum for the trial of this action. That application was dismissed by Chief Master Marsh on 14 November 2014.

2

By an application notice dated 11 December 2014 the defendant applied to strike out the claim and the amended particulars of claim under CPR Part 3.4(2)(a), alternatively the inherent jurisdiction of the court, on the basis that the amended particulars of claim disclose no reasonable grounds for bringing the claim.

3

The issue on this application is whether the tort of malicious prosecution of civil proceedings is known to English law.

4

The defendant maintains that there is no such tort known to English law and I am bound by the decision of the House of Lords in Gregory v Portsmouth City Council [2000] 1 AC 419, HL. This is a claim which must therefore be struck out. Mr Bernard Livesey QC, leading Miss Alicia Tew, represented the defendant before me.

5

The claimant disagrees. He relies on Crawford Adjusters (Cayman) Ltd v Sagicor General Insurance (Cayman) Ltd [2014] AC 366, PC where the Privy Council held by a majority that there is a tort of malicious prosecution of civil proceedings. He says I should follow the decision of the Privy Council and dismiss the application. Mr Hugo Page QC, leading Mr Adam Chichester-Clark, represented the claimant.

7

I have decided that the claim for malicious prosecution of civil proceedings should be struck out. This is because this court is bound by Gregory and, in accordance with the doctrine of precedent, I cannot follow Crawford Adjusters. I have reached this conclusion for the reasons set out in detail below.

8

On 23 February 2015 the claimant issued an application to re-amend the particulars of claim to add a claim for the tort of abuse of process. The Chief Master adjourned that application to be dealt with by the judge hearing the strike-out application. However, the parties have agreed that that application should await the determination of the strike-out application.

The allegations in the amended particulars of claim

9

The defendant, Mr Gubay, is a successful businessman who made a substantial fortune from, among other things, the "Kwik-Save" supermarket chain and the "Total Fitness" chain of health clubs in the UK and the Republic of Ireland. The claimant, Mr Willers, was the defendant's right hand man for 23 years from 1986 until he was dismissed by the defendant in 2009.

10

The claimant's case is helpfully summarised in the following terms at paragraphs 2 to 5 of the amended particulars of claim:

"[2] In this claim Mr Willers contends that Mr Gubay maliciously caused proceedings for negligence and breach of fiduciary duty to be brought against him, in circumstances where Mr Gubay knew that the claim was false because he was the author of the acts complained of within those proceedings. Those proceedings are known herein as "the Langstone Action" and were brought against Mr Willers by Langstone Leisure Limited ("Langstone"), a company within a group of companies known as the Anglo Group. The Anglo Group is controlled by Mr Gubay.

[3] In the Langstone Action it was alleged that Mr Willers had acted in breach of his common law and fiduciary duties to Langstone as a director in causing Langstone to fund and indemnify the Liquidator of a company known as Aqua Design and Play Limited ("Aqua") for the purpose of investigating and prosecuting an action against David and Shaun Adams, Aqua's former directors, for wrongful trading and the giving of unlawful preferences. The costs incurred by the Liquidator and those of the Adams family, for which Langstone became liable after that action was abandoned shortly before trial in late 2009 on the instructions of Mr Gubay, amounted to £1.95m. The underlying action is known herein as the "Wrongful Trading Action".

[4] By his Defence and Part 20 Claim in the Langstone Action Mr Willers denied liability and sought an indemnity from Mr Gubay, whom he joined into the action as Third Party. The indemnity was claimed on the grounds that Mr Gubay was the sole effective decision maker of the Anglo Group and Mr Gubay had directed Mr Willers to prosecute and carry on the Wrongful Trading Action through Aqua's Liquidator; such that he was responsible for any loss and damage caused to Langstone as a consequence.

[5] On 28 March 2013, 2 weeks before the date fixed for a 5 week trial of the Langstone Action, Langstone gave notice of discontinuance of the action. By order of Newey J dated 16 April 2013, Langstone was ordered to pay Mr Willers' costs and Mr Gubay's costs of the Part 20 Claim."

11

I should record that the amended particulars of claim do contain more detailed allegations grouped together under the following headings: Mr Gubay's control of the Santon Trust and Anglo Group; Mr Gubay's attitude to litigation and control over the Anglo Group's litigation; Dismissal of Mr Willers; The proceedings brought by Langstone; and Malicious prosecution: (i) Mr Gubay's prosecution of the Langstone Action; (ii) determination in Mr Willers' favour; (iii) lack of reasonable and probable cause; (iv) malice; and (v) damage. Except for the point that the tort does not extend generally to civil proceedings, Mr Livesey QC does not take any issue with the rest of the pleading or make any complaint that the claim has not been properly pleaded. He has of course reminded me that, for the purposes of determining the defendant's application, I must proceed on the basis that the facts alleged by the claimant will be proved at trial. That, it seems to me, is all I need to say about the amended particulars of claim for the purposes of this judgment.

Malicious prosecution: general

12

The editors of Clerk & Lindsell on Torts, 21 st ed (2014), pp 1182–1183, para 16-09 state that:

" Essentials of the tort of malicious prosecution In an action for malicious prosecution the claimant must show first that he was prosecuted by the defendant, that is to say, that the law was set in motion against him by the defendant on a criminal charge [footnote 48]; secondly, that the prosecution was determined in his favour; thirdly, that it was without reasonable and probable cause; fourthly, that it was malicious."

13

Putting on one side footnote 48, Mr Livesey QC has told me that this passage has appeared in the same terms in many editions of Clerk & Lindsell on Torts over very many years. This passage was cited with approval by the House of Lords in Martin v Watson [1996] 1 AC 74, at p 80C and also in Gregory at p 426G-H.

14

Footnote 48 was added in the 21 st ed. of Clerk & Lindsell on Torts and explains that the need for the prosecution to be on a criminal charge:

"… will remain the case unless the English courts decide to follow the majority of the Privy Council in [ Crawford Adjusters]…"

The contents of that footnote correspond with the issue before me.

Precedent

(a) The main submissions

15

The principal submission of counsel for the defendant, Mr Livesey QC, is based on the law of precedent. He submitted as follows:

(1) In Gregory the House of Lords held that the tort of malicious prosecution does not (with a few immaterial exceptions) extend beyond the abuse of criminal proceedings.

(2) The doctrine of precedent of English Law requires that a judge of the High Court should respect (but is not bound to follow) a decision of another judge of the High Court, but must follow decisions of the Court of Appeal and the House of Lords and now the Supreme Court: see, for example, Policy Authority for Huddersfield v Watson [1947] KB 842, CA per Lord Goddard at p 848. The House of Lords and now the Supreme Court is not bound by its own decisions, but may depart from them in the circumstances identified in the Practice Statement (Judicial Precedent) [1966] 1 WLR 1234.

(3) The Judicial Committee of the Privy Council is not a court. Rather, its function is to advise Her Majesty on "appeals to Her Majesty in Council" from any court in any colony (see section 1 of the Judicial Committee Act 1844). The Privy Council does not therefore appear in the hierarchy of courts in England and Wales save exceptionally, by way of example, in appeals from Ecclesiastical cases where its decisions will be binding on the courts in that hierarchy.

(4) The High Court or the Court of Appeal should not follow a decision of the Privy Council in place of a decision of the House of Lords, unless the circumstances are quite exceptional and the court is satisfied that in practice the result would be a foregone conclusion: In re Spectrum Plus Ltd (in liquidation) [2004] Ch 337, CA at paras 57–59, pp 373G–374C, per Lord Phillips MR; R v James [2006] QB 588, CA, at paras 38–44, pp 600F–602A, per Lord...

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