Rosesilver Group Corporation v Ian Paton
| Jurisdiction | England & Wales |
| Judge | Mr Justice Mann |
| Judgment Date | 19 June 2015 |
| Neutral Citation | [2015] EWHC 1758 (Ch) |
| Date | 19 June 2015 |
| Docket Number | Case No: HC-2014001808 |
| Court | Chancery Division |
[2015] EWHC 1758 (Ch)
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
Royal Courts of Justice
Rolls Building, 7 Rolls Buildings
Fetter Lane, London EC4A 1NL
Mr Justice Mann
Case No: HC-2014001808
Mr Barry Isaacs QC and Ms Helen Galley (instructed by Gordons Solicitors) for the Claimant
Mr Kavan Gunaratna (instructed by Strafford Law Ltd) for the Defendant
Hearing dates: 11 th & 12 th June 2015
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.
This is an application for summary judgment on a claim for specific performance which is brought by the purchaser under a contract for the purchase and sale of the leasehold interest in property known as 47 Belgravia Court, Ebury Street, London SW1. The claimant ("Rosesilver") is the purchaser and the defendant is the registered proprietor and vendor.
Before setting out the terms of the contract it is necessary to set out some background, and in particular to refer to some litigation which features heavily in this case. The defendant (Mr Paton) and his partner, Miss Amanda Clutterbuck, are and were at all material times experienced property developers. Rosesilver and a related company, Sator Properties Ltd ("Sator"), are both BVI companies. Mr Martin Forrester has provided Rosesilver's witness statement in support of this application and says he is the sole beneficial owner of both companies. Sator had lent substantial sums of money both to Mr Paton and, in due course, to Miss Clutterbuck. As at the date of the contract Mr Paton and Miss Clutterbuck had engaged in, or were about to be engaged in, litigation (called "the Al Amoudi litigation"), and other litigation called "the EN litigation", in which they were making claims which, they apparently believed, would yield very significant sums of money were they to be successful. The uncontested evidence of Mr Forrester was that by April 2010 Sator had lent Mr Paton the sum of £1.5 million as an agreed sum. As part of the security for that sum he had given a charge over the parking space at the property (but not the property itself). Over the following two or three years Sator lent further sums both to Mr Paton and then to Miss Clutterbuck. Mr Forrester exhibited a schedule of the sums lent to Miss Clutterbuck. That schedule showed that as at a point of time in this year the debt owed by Miss Clutterbuck was £1.5 million. However, Miss Clutterbuck disputes that amount, and it is right to observe that that sum does not reflect any sum which was paid to her, or which fell to be treated as paid to her, under the two agreements which are the subject of this action (as to which see below), contrary to the arrangements as they are described by Mr Forrester. As far as Mr Forrester was concerned, the loan monies were mostly used to pay for general living expenses and for investing in new prospective businesses and some legal costs.
Both sets of litigation have not, at least up until now, resulted in success. The fate of the EN proceedings was not clear to me, but it was not suggested that they had been successful. So far as the Al Amoudi proceedings are concerned, on 20 th February 2012 Asplin J delivered judgment at the end of a twenty day trial in which the claimants (Mr Paton and Miss Clutterbuck) failed on all claims [2014] EWHC 383 (Ch). They were refused permission to appeal to the Court of Appeal, but they have now apparently made a renewed application in which they are alleging that the judgment was procured by fraud. The hearing of their renewed application is to take place later this year. As things stand, they have failed in the litigation, and they do not have permission to appeal.
I turn now to the contract sued on, and its amendment. The contract which is sued on has been varied. The original contract is dated 10 th May 2011 and it contains the following relevant provisions:
(a) The price is expressed to be £850,000.
(b) The purchase price is said to be payable as to £90,000 on the date of the contract, £210,000 to Miss Clutterbuck, and as to £550,000 on completion.
(c) The deposit is said to be £300,000 pounds.
(d) Clause 3 says: "A deposit in the sum specified in the Schedule has been paid either by telegraphic transfer to the Seller's Solicitors client account…". The solicitors are identified as Messrs Brook Martin and Co. One of the principals in that firm is a Mr Stephen Brook; further reference will be made to him below.
(e) The completion date is said to be "Upon seven days written notice to be served by the Buyer upon the Seller". Added to those typed words are the manuscript words "and upon completion Amanda Clutterbuck will if in occupation deliver vacant possession of the property".
(f) Clause 24 is an "Entire Contract" clause which provides:
"This agreement constitutes the entire agreement between the parties to the exclusion of any antecedent statement or representation whether oral or written and/or implied… and the Buyer hereby acknowledges that save as to the written statements of the Seller's Solicitors prior to the making of this Agreement the Buyer has not entered into this agreement in reliance wholly or partly on any statement or representation made to the Buyer and the parties agree that this Agreement may only be varied or modified (whether by way of collateral contract or otherwise) in writing under the hands of the parties or their Solicitors."
(g) Clause 26 provides:
"Amanda Clutterbuck hereby acknowledges that at the request of Ian Paton the Buyer has paid direct to her the sum of £210,000 prior to the date hereof and Ian Paton acknowledges that he so directed payment and that the same be a credit against the purchase price herein."
(h) The Buyer is defined in the schedule as being the present claimant. Miss Clutterbuck's name also appears there, but it has been deleted and the deletion initialled. The amount of the deposit and the "capacity in which deposit is held" have been inserted in manuscript, and those additions, together with the manuscript addition to the completion date provision (identified above) have all been initialled apparently by Mr Paton and Miss Clutterbuck. Miss Clutterbuck has also signed the contract.
The contract was varied by a Supplemental Agreement dated 31 st May 2013. This document has the following effect:
(a) The purchase price is deemed to be £1,000,000 instead of £850,000 and is deemed to be inclusive of the payments to be made in accordance with clause 4. In fact in his evidence Mr Forrester says that the clause 4 sums were to be paid in addition to the £1m.
(b) Under clause 26 of the first agreement, the sum of £210,000 (payable to Miss Clutterbuck) should be deemed to read £360,000, and in the Supplemental Agreement Miss Clutterbuck acknowledged at the request of the Seller that the buyer had paid that sum to her directly prior to the date thereof, and the Seller acknowledged that he had so directed payment and that the same be credited against the purchase price.
(c) Mr Paton and Miss Clutterbuck acknowledged that the amounts respectively paid to them to date in cash and amounting in aggregate to £450,000 were paid by Sator on behalf of the Seller. This averment does not make sense. I suspect that the "by" should be a "to".
(d) Under clause 3.1 the seller agreed to make and pursue a ninety year lease extension. On completion the seller was to assign for no consideration the benefit of that claim. Clause 4 provided that the buyer would provide to the Seller all payments due in order to conclude the making of such a claim.
(e) The agreement was signed by Mr Paton and Miss Clutterbuck.
In addition to that agreement, Mr Paton also executed a transfer in escrow of the property in favour of the claimant.
There was for some significant time no insistence on completion, but in due course the claimant sought completion and gave an appropriate notice. The defendant refused to complete and these proceedings were brought. The claim form was issued in or about November 2014. A Defence was served dated 8 January 2015, and signed by Mr Paton's solicitor. It is necessary to have in mind some of its specific terms.
(a) The two contracts were admitted as being documents entered into by Mr Paton and the claimant. However, it was averred that the manuscript addition about completion was not original and had been added after execution by a person unknown and without the knowledge of Mr Paton. This allegation was made notwithstanding the fact that he seemed to have initialled those words. Mr Barry Isaacs QC, who appeared for the claimant on this application, described that as an allegation of forgery. I'm not sure that that is a fair characterisation of the allegation, but it is right to observe that by the time the application came before me that point seems to have been abandoned by Mr Paton.
(b) Paragraph 4 reads:
"4 The Defendant entered into the May 2011 agreement in order to provide security for loan finance from [Sator] to the defendant and/or Amanda Clutterbuck ("Ms Clutterbuck"), the primary purpose of such loans… being to finance the Defendant's and Ms Clutterbuck's proceedings against a woman going by the name of Sarah Al Amoudi ("the Al Amoudi litigation") and related litigation. As at 2011 the property was worth approximately £1.1 million and the Defendant simply would not have sold it for £850,000. The Defendant was induced to enter into the May 2011 agreement by Stephen Brook ("Mr Brook") a partner of Brook Martin & Co-solicitors ("BM"). In particular:
(a) Mr Brook was and had been since approximately 2004 the Defendant's and Ms Clutterbuck's solicitor and the Defendant trusted Mr Brook to...
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