Weston v Dayman
| Jurisdiction | England & Wales |
| Judge | THE CHANCELLOR |
| Judgment Date | 25 October 2005 |
| Neutral Citation | [2005] EWHC 3181 (Ch),[2005] EWHC 3053 (Ch) |
| Court | Chancery Division |
| Docket Number | Case No: GLC 174/055,Case No: HC04CO3575 |
| Date | 25 October 2005 |
[2005] EWHC 3053 (Ch)
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
The Chancellor (Sir Andrew Morritt)
Case No: GLC 174/055
MR PHILLIP GREENWOOD (instructed by Messrs Simmons & Simmons) appeared on behalf of the Applicant.
MR MARK WARWICK (instructed by Messrs Henri Brandman & Co) appeared on behalf of the Respondent.
Approved Judgment
Tape Transcript of Smith Bernal Wordwave Limited 183 Clarence Street Kingston-upon-Thames KT1 1QT Tel No: 020 8974 7300 Fax No: 020 8974 7301 (Official Shorthand Writer's to the Court)
: On 23rd January 2003 Henriques J discharged the defendant, Mrs Dayman, with effect from 1st February 2003 from the receivership of the assets of the claimant, Mr Weston, ordered by Hidden J on 10th 1988. Paragraph 10 of that order reads as follows:
"The receiver shall not be liable for any failure by her to properly manage the estate of the defendant after the discharge of the receiver."
By his order made on 5th September 2005, Master Bowles ordered that there should be tried as a preliminary issue the question:
"Whether on the true construction of the order, the defendant was, on the discharge of the receivership on 1st February 2003, released from all liability for any failure properly to manage the claimant's estate during the period of the receivership."
Those are the bare bones of the first of the disputes before me. I should now put some flesh on them. On 19th October 1998, Laws J made a restraint order against Mr Weston under section 77 of the Criminal Justice Act 1988 in relation to certain criminal charges which had been brought against Mr Weston. On 17th November 1998, Hidden J appointed Mrs Dayman, a licenced insolvency practitioner and partner in BDO Stoy Haywood, to be receiver and manager of the assets of Mr Weston. Paragraph 33 of Schedule 1 identified M.V. Poseidon as one of those assets.
In March 1999, Mrs Dayman took possession of M.V. Poseidon at Bendmadena in Spain. She caused it to be moved to Soto Grande where it was taken ashore on 30th April 1999. She then engaged the services of Captain Comar to sail it back to England where it was moored at Shamrock Quay, Southampton, but its location was concealed from Mr Weston.
On 16th October 2002, Mr Weston was acquitted at the third trial of the charges brought against him and the restraint order was discharged.
On 15th November 2002, Mrs Dayman applied to the court for directions regarding receivership costs and expenses and certain disputes as to ownership of the assets under her control, including the Poseidon. This was supported by a witness statement made by her on 20th October 2002. In her witness statement in relation to this application, she explained:
"In practice receivership orders are usually discharged by way of a written application to the High Court by the prosecutor. The order is made and the prosecutor gives notice to those affected. On previous occasions I had experienced problems as a result of receiverships being discharged with no directions as to the resolution of outstanding issues. The Weston receivership had been lengthy, complex and expensive. In the circumstances, I wanted the court to give clear directions providing for its completion within a reasonable time."
She then refers to the application having been made by solicitors acting on her behalf:
"They sought to ensure that the receivership order was not discharged without notice, in order to give me the opportunity to seek directions from the court in connection with the various outstanding issues. I took that opportunity and on 15th November 2002 applied for an order for directions as to the payment of receivership costs and expenses following the discharge of the restraint order and the likely imminent discharge of the receivership order."
On 9th December 2002, the solicitors for various claimants to the M.V Poseidon consented to Mrs Dayman returning it to Mr Weston. As I have indicated, on 23rd January 2003 Henriques J made an order by consent discharging the receivership with effect from 1st February 2003. This was the culmination of protracted negotiations and the settlement of a number of issues. Paragraph 1 to 2A dealt with the use of money in certain specified accounts. Paragraphs 3 to 6, both inclusive, fixed an upper limit on the costs of the receivership and dealt with the prospective liability of the receiver for capital gains tax. Paragraphs 7 to 10 are in the following terms:
"7. The receivership be received at 12.00 noon on the first day of February 2003.
8. The receiver shall apply forthwith to remove cautions registered in her favour against any property in respect of which Mr and Mrs Weston have an interest.
9. All insurance premiums in existence at present to be continued for a period of seven days from today. Any insurance costs incurred to be drawn by the receiver in addition to the sum agreed in paragraph 3.
10. The receiver shall not be liable for any failure by her to properly manage the estate of the defendant after the discharge of the receiver."
Paragraphs 11 to 14 of the order dealt with costs incurred by Mr Weston's wife, provided for the supply of information to certain parties and gave liberty to apply in an event which did not occur.
On the same day, 23rd January 2003, Mrs Dayman told Mr Weston where the boat was, but the evidence is silent as to when and how Mr Weston re-took possession of it. As I have indicated, on 1st February 2003 the receivership discharge took effect.
On 10th November 2003, Mr Weston applied for permission to sue Mrs Dayman, as required by the decision of this court in Re Maidstone Palace of Varieties [1909] 2 Chancery 283, for damages for breach of duty. This was supported by a witness statement of Mr Weston, clearly stating the nature of the proceedings he wished to bring.
On 10th December 2003, Elias J granted to Mr Weston permission to commence a case against Mrs Dayman for damages for breach of duty as the receiver under the order of Hidden J in respect of the appropriate care of M.V. Poseidon.
The claim form was duly issued on 15th November 2004 and the subsequent pleadings have raised issues as to the proper management by Mrs Dayman of the Poseidon during her receivership, and in particular whether the vessel had been properly looked after. The precise nature of those issues is not presently material.
On 20th May 2005, Master Bowles gave directions for the trial of that claim, pursuant to which it was set down for trial to commence on 20th January next with a time estimate of five days. Then, on 15th June 2005, Mrs Dayman issued an application for summary judgment. She claimed that the order sought by Mr Weston is precluded by paragraph 10 of the order of Henriques J and the claim should therefore be dismissed.
On 31st August 2005, a Mr Brandman, solicitor for Mr Weston, made a witness statement in opposition to the application for summary judgment. He contended that paragraph 10 of the discharge order related only to liabilities incurred in the period between the discharge on 1st February 2003 and the return of the relevant asset by Mrs Dayman to Mr Weston, and that the order of Elias J was inconsistent with any other conclusion.
At the hearing of the application for summary judgment before Master Bowles on 5th September 2005, he directed the trial of the preliminary issue to which I have already referred, and he adjourned the application for summary judgment then before him to come on at the same time.
In essence, therefore, the dispute is whether paragraph 10 is prospective and only covers management after the discharge of the receivership, as Mr Weston contends, or whether it relates to management during the receivership for which the receiver might be sued after its conclusion. It is not disputed that a court appointed receiver cannot be sued for acts occurring during its currency except with the leave of the court. See Re Maidstone Palace of Varieties [1909] 2 Chancery 283. Similarly, it is common ground that the court has jurisdiction to release a court appointed receiver from such liability, but will not normally exercise it without first investigating the circumstances. See Inland Revenue Commissioners v Van Hoogstraten [1985]...
To continue reading
Request your trial
- Weston v Dayman
-
Cordell Green v Kingsley Stewart
... ... 25 In Roger James Weston v Sara Elizabeth Dayman [2006] EWCA Civ 1165 cited in Deltonia Williams , Lady Justice Arden in the Court of Appeal, in interpreting the terms of ... ...