Sheikh Tahnoon Bin Saeed Bin Shakhboot Al Nehayan (Claimant/Appellant) v Ioannis Kent (Also Known as John Kent)
| Jurisdiction | England & Wales |
| Judge | Mr Justice Cranston |
| Judgment Date | 05 May 2015 |
| Neutral Citation | [2015] EWHC 1176 (QB) |
| Date | 05 May 2015 |
| Court | Queen's Bench Division |
| Docket Number | Case No: QB-2014-0621 |
[2015] EWHC 1176 (QB)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Royal Courts of Justice
Strand, London, WC2A 2LL
The Honourable Mr Justice Cranston
Case No: QB-2014-0621
HQ13X03549
Paul Burton (instructed by Davis-Law Associates) for the Claimant
James Laddie QC and Nicholas Gibson (instructed by Simons Muirhead & Burton) for the Defendant
Hearing dates: 21/04/2015
Introduction
This is an appeal brought by the claimant, Sheikh Tahnoon Bin Saeed, against the orders of Master McCloud dated 23 January 2014 and of Deputy Master Eyre ("Master Eyre") dated 24 November 2014. The issue is whether the orders properly give permission to the defendant to amend his defence and counterclaim in the significant manner he purports to do and to withdraw admissions made in the original. The claimant contends that neither Master complied with the Civil Procedure Rules ("the CPR") in making these orders.
Background
The facts in this litigation are at present hotly disputed. At base the claimant is an Emirati national who invests, inter alia, in real estate. The defendant carries on various hotel businesses in Greece and Cyprus. The claimant invested money with the defendant for the purposes of the hotel businesses.
The claim issued on 8 July 2013 alleged that the defendant owed a sum of some €2.4 million, nearly £2 million, under a Framework Agreement which obliged him to discharge certain obligations defined as the "operational debts" and to indemnify the claimant against certain costs. It was said that the Framework Agreement was entered between the parties on 23 April 2012. It is governed by English law.
The defence and counterclaim of 29 August 2013 admitted the Framework Agreement and alleged that the defendants had paid many of the operational debts but not all of them. The counterclaim alleged that the claimant had broken the Framework Agreement to procure the release of certain personal guarantees given by the defendant to banks in respect of loans made in connection with the project. It referred to how the Framework Agreement should be properly construed.
A defence to the counterclaim was served on 7 October 2013.
The defendant filed a notice of change of solicitors on 21 November 2013.
Draft amended particulars of claim were sent to the defendant sometime in December 2013. The amendments were underlined in the ordinary way. Under them the amount claimed was increased to a sterling equivalent of some £18 million, importantly by reference to sums owing under a Promissory Note, introduced in the amendments, and governed by English law.
On 10 January 2014, the defendant's solicitor wrote, enclosing by way of service a costs budget, although stating that they understood that the value of the claim was outside the costs budget regime. The letter stated that the case management conference, which was scheduled for 23 January 2014 was, in their view, premature in light of the substantial amendments to the defence and counterclaim they had advised the defendant to make. Information was still being collected regarding the proposed amendment and it would therefore be a little while before the draft amended pleading would be ready for service.
"We are currently of the view that our client will require 35 days after the amended claim is formally served to serve his amended defence."
The costs budget in the form of Precedent H stated:
"Following a review of the claim by [his new solicitors] and preliminary Counsel's advice the Defendant will be applying for permission to amend his Defence beyond those amendments caused or occasioned by the Claimant's propossed [sic] amendment to the [particulars of claim] to allege that the relationship between the Claimant and the Defendant was that of a joint venture which gave rise to fiducary [sic] duties. In breach of the duty the Claimant owed to the Defendant the Claimant threatened not to provide any or any sufficient funding to the joint venture and to terminate it without any or any sufficient notice and without any other justification. Such threats were intended to and did induce the Defendant to enter into a number of agreements including the Framework Agreement and the Promissory Note alied [sic] to it. As such, the Framework Agreement and the Promissory Note were procurred [sic] by economic duress or undue influence and as such are voidable by the defendant. Additionally, or alternatively the Defendant is entitled to damages for breach of the joint venture and compensation in lieu of recission [sic]."
The claimant's solicitor replied on 13 January 2014. Although pleadings are not set in stone, the email read, there was no intention for the moment to amend the particulars of claim further. There was no reason to adjourn the case management conference, since the draft amendments to the particulars of claim had been available for some time. "Will you please therefore indicate whether you are agreeable to the amendments."
The defendant's solicitors served a slightly amended version of the costs budget the same day.
The defendant's response of the 14 January 2014 noted the rejection of the proposal to adjourn the case management conference. The letter acknowledged the power of the court to permit amendments at any stage, but noted that the discretion must be exercised "judiciously". The letter added:
"[O]ur client will require 42 days from the date of the [case management conference] and re-service to plead to the new claim and to amend his defence and counterclaim in the manner foreshadowed in our client's costs budget.
On the basis set out above our client will consent to the amendment on the usual terms as to costs…"
On 15 January 2014 the defendant's solicitor wrote again in anticipation of the case management conference. Among other things, the letter said:
"As you are aware, our client now intends to amend his Defence and Counterclaim to allege that there was a joint venture between him and your client which gave rise to fiduciary duties and of which your client has been in breach. In those circumstances, we believe that the litigation arising from the dispute should be conducted in the Chancery Division rather than the Queen's Bench Division. Accordingly, at the [case management conference] we will be seeking that the proceedings be transferred to the Chancery Division."
The request to adjourn the case management conference was repeated, on the basis that the time requested to amend the defence was short.
On 17 January 2014 the defendant's solicitor filed a directions questionnaire indicating an intention to call the defendant and at least three other persons as witnesses to the material facts, including the circumstances giving rise to undue influence and duress.
The Masters' orders
On 23 January 2014, Master McCloud conducted a case management conference. The claimant was represented by Mr Davis, his solicitor, the defendant by Mr Gibson of counsel. The Master began with the proposed transfer to the Chancery Division, which Mr Davis said he opposed. Mr Gibson explained that it was because the proposed amendments to the defence related to fiduciary duties and told the Master that the basis of the amendments was set out in the costs budget. There would be amendments as well consequent on the claimant's amendments to the particulars of claim. Mr Gibson added that once the claimant had seen the defendant's amendments he would have an opportunity to reply and in that event the case management conference should be relisted. There followed this exchange:
"MR GIBSON: I understand we are in agreement ——
MASTER McCLOUD: Save on the transfer point then, you are agreed on the basis put forward.
MR DAVIS: Yes.
MASTER McCLOUD: I am happy to order that. As I say, the pleadings I did not see in the terms of the case but ——
MR GIBSON: No, of course.
MASTER McCLOUD: —— but I can still do it."
There was then a discussion about transfer to the Chancery Division, with the claimant being asked to reconsider once he saw the amended defence and counterclaim, and about the defendant bearing the costs associated with it.
The Master's order following the hearing, dated 23 January 2014 but sealed on 14 March 2014, provided that by 24 January 2014 the claimant should file and serve his amended particulars of claim in the form set out in the case management conference bundle. In addition, by 7 March 2014 the defendant should file and serve an amended defence and counterclaim. Other parts of the order provided for relisting of the case management conference, possible transfer to the Chancery Division (automatically should the claimant agree) and an obligation on the defendant to pay the claimant's costs occasioned by his amended pleading.
The amended defence and counterclaim was served on 7 March 2014. It responded to the amendments of the particulars of claim but also introduced, in detail, allegations of breach of fiduciary duty, undue influence and duress, giving "chapters and verse" (as Mr Laddie QC put it) of events leading up to the signing of the Framework Agreement on 23 April 2012. There was no highlighting of the amendments by underlining, since essentially it was a substituted defence and counterclaim, advancing the defendant's case in a different and more elaborate way.
On 12 March 2014 the claimant's solicitor wrote accepting and acknowledging the amended defence and counterclaim and refusing consent to transfer to the Chancery Division. A fortnight later, on 27 March 2014, he wrote that in light of the amended defence and counterclaim the defendant would need permission to retract the admissions in relation to the Framework Agreement made in...
To continue reading
Request your trial
-
Sheikh Tahnoon Bin Saeed Bin Shakhboot Al Nehayan v John Kent (Also known as Joannis Kent)
...detail. The claimant took issue with the amended pleading which led to hearings before Master Eyre and a judgment from Cranston J [2015] EWHC 1176 (QB) on 5 May 2015. Cranston J upheld the amended defence pleading. Since that time there has been a hiatus in the proceedings. 4 On 29 July 20......