Rawlinson & Hunter Trustees Sa (in Its Capacity as Trustee of the Tchenguiz Settlement) v Itg Ltd and Another
| Jurisdiction | England & Wales |
| Judge | Mr Justice Morgan |
| Judgment Date | 10 June 2015 |
| Neutral Citation | [2015] EWHC 1664 (Ch) |
| Docket Number | Case No: HC 2013 000411 |
| Court | Chancery Division |
| Date | 10 June 2015 |
[2015] EWHC 1664 (Ch)
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
Royal Courts of Justice
Rolls Buildings, Fetter Lane,
London, EC4A 1NL
Mr Justice Morgan
Case No: HC 2013 000411
(in their capacity as trustees of the Tchenguiz Discretionary Trust)
Mr Charles Hollander QC and Ms Elizabeth Weaver (instructed by Stephenson Harwood LLP) for the Claimant
Mr Daniel Lightman and Mr Paul Adams (instructed by Bircham Dyson Bell LLP) for the Defendants
Hearing date: 4 June 2015
The application
On 12 January 2015, the Claimant issued an application notice seeking the following relief:
(1) permission to re-amend its claim form and its particulars of claim in the form of drafts annexed to the application notice;
(2) permission to add Rawlinson & Hunter Trustees SA in its capacity as trustee of the NS One Trust ("the NS1 Trust");
(3) permission to add Vimaletor Holdings Limited ("Vimaletor") as a second claimant;
(4) permission to add ITG Limited in its own capacity as a Defendant (this part of the application was later not pursued); and
(5) (to the extent necessary) permission to serve the re-amended pleadings and other documents on the Defendants out of the jurisdiction, in Guernsey.
In relation to the application for permission to re-amend its pleadings, the Claimant put forward the contention, in its application notice, that new documentary evidence had come to light which justified and supported its proposed re-amendments.
Mr Hollander QC and Ms Weaver appeared on behalf of the Claimant and Mr Lightman and Mr Adams appeared on behalf of the Defendants.
At the hearing of these applications it was agreed that the real focus of the argument should be on the application for permission to serve the proposed re-amended pleadings out of the jurisdiction. The existing pleadings (an Amended Claim Form and an Amended Particulars of Claim) have been served, following the grant of permission by the court to serve out of the jurisdiction. The proposed re-amendments to the pleadings seek to introduce further causes of action. It was common ground that the court should not grant permission to re-amend the pleadings to introduce further causes of action against a foreign defendant unless it was a proper case for the court to grant permission to serve out if those claims had been the subject of a separate claim form for which permission to serve out was sought. In relation to that matter, the Claimant submitted that the court ought to give permission to serve out in relation to the pleadings which set out the further claims. The Defendants submitted the contrary.
The Defendants have raised a preliminary objection to the court considering whether it ought to give permission to serve out in relation to the pleadings which set out the further claims. The Defendants say, correctly, that the present application for permission to serve out in relation to the further claims is not the first application for such permission. They say that the Claimants previously applied for that permission in relation to these claims and, when the matter was considered at an inter partes hearing, the court concluded that the Claimants should not be permitted to serve out in relation to them. It is then submitted that there is an issue estoppel which prevents the Claimant making this second attempt to obtain permission to serve out in relation to the further claims and, alternatively, that this application is an abuse of the process of the court and the court ought not to entertain it.
The Claimant submits that there is no relevant issue estoppel, that the present application is not an abuse of the process of the court and that the court should hear and determine the application on its merits in accordance with the established general principles as to service out of the jurisdiction.
At the hearing, I invited argument on the Defendants' preliminary objection based on issue estoppel and abuse of process. Having concluded argument on those issues, I indicated that I did not wish to hear argument on the application itself and that I would reserve my decision on the preliminary objection.
This judgment contains my reasons for concluding that the present application, in so far as it seeks permission to serve pleadings containing the further claims out of the jurisdiction, is an abuse of the process of the court and, as a result, that the application ought to be dismissed.
When this action began, there were two Claimants, Rawlinson & Hunter Trustees SA ("R&H") and Vimelator. At present there is only one Claimant, R&H. The present application before me is by the present sole Claimant but if I were to grant it there would again be two Claimants, as Vimelator would again become a second Claimant. Because the substance of this application is for permission for R&H and Vimelator to serve out of the jurisdiction, I will, in the remainder of this judgment, refer to them as "the Claimants". For convenience and to avoid having to keep explaining that for some of the time there were two Claimants and for some of the time there was only one, I will use the term "the Claimants" whether I am referring to both of those companies or just R&H as the present sole Claimant.
Background matters
The Tchenguiz Settlement ("the TS") is a discretionary trust created in 1986 and governed by the laws of Guernsey. At all relevant times until 9 April 2010, the sole trustee of the TS was Investec Trust (Guernsey) Ltd, a company registered in Guernsey; it has now changed its name to ITG Ltd ("ITG"), and is the First Defendant. On 9 April 2010, ITG was replaced as trustee by R&H, a company registered in Switzerland.
The Tchenguiz Discretionary Trust ("the TDT") is a discretionary trust created in 2007 and governed by the laws of Jersey. At all relevant times until 1 July 2010, the trustees of the TDT were ITG and Bayeux Trustees Ltd ("Bayeux"); Bayeux is the Second Defendant and is registered in Guernsey. On 1 July 2010, ITG and Bayeux were replaced as trustees by R&H.
The NS1 Trust is a discretionary trust, created in 2009 and governed by the laws of Jersey; R&H has been and is the sole trustee of that trust.
Vimaletor is registered in the British Virgin Islands. The issued share capital of Vimaletor is held by R&H on trust for the NS1 Trust.
Iver Resources Ltd ("Iver") is registered in the Isle of Man. The issued share capital of Iver was vested in ITG and Bayeux as trustees of TDT. Although since 1 July 2010 ITG and Bayeux have ceased to be the trustees of the TDT, they remain the registered holders of the shares in Iver. Iver is the lessee of a substantial property in London in which Robert Tchenguiz resides. He is a discretionary beneficiary under both the TS and the TDT.
Until March 2009, Mr Clifford was a director of ITG and a director of the corporate directors of Bayeux. It seems that from April 2009, he acted as a consultant for ITG.
The procedural history
On 3 April 2013, R&H and Vimelator, as Claimants, issued a Claim Form naming two Defendants, ITG and Bayeux. Particulars of Claim were attached to the claim form. The Particulars of Claim pleaded the matter in some detail but essentially put forward three claims, to which I will refer as "the contract claim", "the estoppel claim" and "the loan agreement claim".
The contract claim concerned an alleged contract by ITG and Bayeux as the trustees of the TDT to sell their shares in Iver to the trustees of a new trust which would be created. The contract claim was pleaded as follows:
(1) the contract was made orally at a meeting in London on 5 February 2009; the persons present at that meeting were Mr Clifford (on behalf of ITG and Bayeux), Victor Tchenguiz (the settlor of the TS), Robert Tchenguiz (a discretionary beneficiary under the TS and the TDT and resident in the property of which Iver held the lease) and Mr Smalley (a director of R20 Ltd, an investment adviser to the trustees of the TDT);
(2) the contract was varied on 11 March 2009 at a meeting in London attended by Mr Clifford and Mr Smalley when Mr Clifford on behalf of the trustees of the TDT agreed a variation of the contract with himself on behalf of the trustee of the TS;
(3) on 26 March 2009, a payment of £6 million was made by the trustees of the TS to the trustees of the TDT and this was in effect a part performance of the contract as varied;
(4) the NS1 Trust was established as the new trust so that the trustees of that trust would be the transferee of the shares in Iver;
(5) the trustees of the NS1 Trust were entitled to enforce the contract made on 5 February 2009, as varied on 11 March 2009;
(6) there were further negotiations which led to an oral agreement on 15 September 2009 which varied the earlier agreement;
(7) under the agreement as varied on 15 September 2009, the trustees of the TDT were obliged to transfer the shares in Iver to Vimelator;
(8) the pleadings do not identify who made the alleged oral agreement on 15 September 2009;
(9) documents were drafted to give effect to the contract as varied on 15 September 2009 but those documents were not executed; and
(10) R&H and Vimelator claimed specific performance of the contract as varied on 15 September 2009 and other remedies for breach of contract.
The estoppel claim was pleaded in the alternative to the contract claim. It was pleaded that there was a proprietary estoppel binding ITG and Bayeux as the trustees of the TDT in favour of ITG as the trustee of the TS. It was pleaded that there were promises and representations on 5 February 2009 which were relied upon when the trustees of the TS paid £6 million to the trustees of the TDT on 26...
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