Prescott v Dunwoody Sports Marketing
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE WALLER,Lord Justice Lawrence Collins,Lord Justice Toulson |
| Judgment Date | 17 May 2007 |
| Neutral Citation | [2006] EWCA Civ 1569,[2007] EWCA Civ 461 |
| Docket Number | Case No: A2/2006/1598,A2/2006/1598, A2/2006/1640 |
| Court | Court of Appeal (Civil Division) |
| Date | 17 May 2007 |
[2006] EWCA Civ 1569
Lord Justice Waller
A2/2006/1598, A2/2006/1640
IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
(MR JUSTICE SIMON)
Royal Courts of Justice
Strand
London, WC2
THE APPELLANT APPEARED IN PERSON.
THE RESPONDENT DID NOT APPEAR AND WAS NOT REPRESENTED.
Judgement
This is an application for permission to appeal the judgment of Simon J given on 29 June 2006. There is also an application for permission to apply to hand in fresh evidence. The background is this. Mr Prescott was a partner in a partnership called Dunwoody Sports Marketing. It would seem as though in May 2005 Mr Prescott fell out with the other major partner, Mr Diamandis, and Mr Prescott left (putting the word neutrally at the moment) the partnership on or about 6 May 2005. There were certain restrictive covenants in the partnership deed forbidding partners to solicit business, entice clients or entice employees for a period of some two years after leaving the firm. The partnership, Dunwoody Sports Marketing, brought proceedings asserting breaches of those covenants. Those proceedings were commenced in June 2005 and interim injunctions were obtained on 9 June 2005; ultimately those injunctions were continued on Mr Prescott giving certain undertakings.
From the papers that are present before me, it would seem as though, in or about July 2005, the partnership was dissolved and its assets taken over by a company, that company being by this time named Dunwoody Marketing Communications Ltd. However, no application was made at that stage to substitute the company for the partnership and in October 2005, in the proceedings, the partnership applied for leave to amend its particulars of claim and inserted, in the claim, a claim for damages, asserted to be due as a result of Mr Prescott having enticed away an employee, Carol Rutter. The particulars of claim asserted that losses had been incurred by the partnership in the months of June, July, August and September, all in 2005, and claimed the sum of £62,912. Proceedings continued and it seems that, on 3 March 2006, the solicitors acting for the partnership gave notice to the solicitors acting for Mr Prescott that they were intending to substitute the company for the partnership in the proceedings, but they did not do that.
By April 2006 Mr Prescott, it seems, had failed to give disclosure or serve witness evidence. He was, at this stage, represented by solicitors and it seems that he was in some financial difficulties in terms of giving instructions to a solicitor and, in the result, he failed to serve evidence and give disclosure. On 4 April 2006 an application was made for an Unless Order, the application of course being made in the name of the partnership because still no substitution order had been made. That application was for an Unless Order requiring Mr Prescott to give disclosure and serve witness statement evidence by I assume 6 April 2006. On 6 April 2006, Master Eyre gave judgment in favour of the partnership with liberty to Mr Prescott to apply to set aside the judgment within 7 days after service of the order. I should say that neither the application for the Unless Order nor the Unless Order itself are in Mr Prescott's documents filed at present.
The partnership again, because no substitution had been made, made an application dated 8 June 2006 to convert Master Eyre's order into a final order and that application came on before Simon J on 29 June 2006. Mr Prescott says that he in fact had notice that that application was going to be made but he did not have notice of the date when it was coming on before Simon J and as far as I can tell from the application that was to be made before Simon J, there was no indication of the date in that application. That application starts with "Re: Boodle Hatfield, on behalf of Dunwoody Sports Marketing, intend to apply…" That appears to be an inaccurate statement in that Dunwoody Sports Marketing no longer existed and, if anything, an application would have had to have been made on behalf of the company, although it had by then not been substituted.
So when the matter came on before Simon J, Mr Prescott was not present. Simon J would not have, and indeed nor would Master Eyre have had, as I understand it, any idea that the partnership should no longer be the claimant in the action and Simon J would not, for example, think of testing the question whether the damages claim being made in relation to Carol Rutter was a claim that the company could properly make. In the result, Simon J made the injunctions permanent and gave judgment, or really confirmed the judgment, that Master Eyre had given for £62,912, and he awarded a rate of interest at 6 per cent and made an order for indemnity costs against Mr Prescott.
It was only thereafter that there was an application to substitute; that is at page 100 in the bundle before me. If a party wishes to be substituted for another, the Rules provide for the way in which that should be done. Rule 19.2(4) provides that:
"[A] court may order a new party to be substituted for an existing one if —
(a) the existing party's interest or liabilities pass to the new party; and
(b) it is desirable to substitute a new party so that the court can resolve the matters in dispute in the proceedings …
An application for permission … may be made by —
a) an existing party; or
b) a person who wishes to become a party."
This application appears to be made by Boodle Hatfield on behalf of the partnership, and it provides for the company giving its consent. One would have thought that the application should have been made by the company, that being the entity in existence, to take over the action from the partnership. That substitution was ordered to be effective on paper, so once again Mr Prescott was not represented. It may be that he has the right to go back and challenge that substitution, he not having being present when it occurred and, as I understand it, he may have an application before Master Eyre tomorrow and he may want to suggest that that substitution should not have taken place, but for today's purposes the issue before this court is the question of whether there might be some right to appeal the judgment that Simon J has entered.
Mr Prescott's position in one sense is not very strong because he, for whatever reason, did not give the disclosure that he should have done, allowed himself to become the subject of an Unless Order, allowed that Unless Order to take effect, and that resulted in Simon J giving the judgment he did. But that said, it seems to me that there may be a point which he should be entitled to argue relating to the substitution of the company for its partnership. As it seems to me, this is not a case where it can be said beyond peradventure that the damages suffered by the partnership must be exactly the same as the damages suffered or asserted by the company. As at July 2005, when it seems as though the partnership was dissolved or wound up and when the company took over, it seems to me there might well be arguable points as to whether any enticing of Carol Rutter was the cause of any damage to the business of the company and, in particular, as to whether the figures which are given as being due to the enticing of Carol Rutter are sums that the company should be entitled to recover.
There is a statement of Stacey Lewis in the bundle which relates to this matter: if permission to appeal were granted, then Mr Prescott would have to seek permission to put that evidence in as fresh evidence. It would be wrong for me rule one way or the other on that, but it seems to me there is an argument for him being entitled to do so if it transpires that he did not in fact have notice of the hearing before Simon J and was thus unable to take the point before him and/or on the basis that, until there was a substitution of the company for the partnership, he was not in a position to take the point at least so far as the company was concerned.
It seems to me that the right course is to adjourn this application so that the company can be represented and indicate the basis on which it would say that it should be entitled to maintain the judgment that it is saying it has. In the light of the points that I have been making, it seems to me that the right course is then to order that, if permission were granted, the appeal should follow, and obviously that means the application to put in fresh evidence should also be adjourned.
What I should make clear is that the only point on which I am granting Mr Prescott permission relates to this substitution point; if it were not for that, then it seems to me that the history demonstrates that the Unless Order was perfectly properly made, he did not seek to set that aside, that Simon J's order would have been perfectly properly made and he should not be entitled to put in any evidence in order now to seek to demonstrate that the claim being made against him by the partnership should have failed. It is the substitution point only which gives him some prospect of succeeding on an appeal to this court.
Order: Application adjourned.
[2007] EWCA Civ 461
Lord Justice Lawrence Collins and
Lord Justice Toulson
Case No: A2/2006/1598
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM QUEENS BENCH DIVISION
MR JUSTICE SIMON
HQ05XO1639
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