William Andrew Tinkler v Iain George Thomas Ferguson

JurisdictionEngland & Wales
JudgeLord Justice Peter Jackson,Lord Justice Dingemans,Sir Richard McCombe
Judgment Date01 February 2021
Neutral Citation[2021] EWCA Civ 18
Docket NumberCase No: A2/2020/1039
CourtCourt of Appeal (Civil Division)
Date01 February 2021
William Andrew Tinkler
Appellant
and
Iain George Thomas Ferguson (1)
Warwick Brady (2)
John David Francis Coombs (3)
Andrew Richard Wood (4)
Respondents

[2021] EWCA Civ 18

Before:

Lord Justice Peter Jackson

Lord Justice Dingemans

and

Sir Richard McCombe

Case No: A2/2020/1039

IN THE COURT OF APPEAL (CIVIL DIVISION)

ON APPEAL FROM THE HIGH COURT OF JUSTICE

QUEEN'S BENCH DIVISION

Mr Justice Nicklin

QB-2018-006293

Royal Courts of Justice

Strand, London, WC2A 2LL

John Wardell QC and Kate Wilson (instructed by Clyde & Co LLP) for the Appellant

Andrew Caldecott QC and Jacob Dean (instructed by Herbert Smith Freehills) for the Respondents

Hearing dates: 15–16 December 2020 (when Lord Justice McCombe, as he then was, presided)

Approved Judgment

Lord Justice Peter Jackson

Introduction

1

On 8 June 2018 the Appellant Andrew Tinkler began an action against the Respondents for defamation and malicious falsehood (‘The Malicious Falsehood Action’). Two years later to the day Nicklin J (‘the Judge’) struck it out. Mr Tinkler now appeals with the permission of Males LJ.

2

CPR 3.4 (2) provides that the court may strike out a statement of case if (a) it discloses no reasonable grounds for bringing the claim, or (b) it is an abuse of the court's process, or (c) there has been a failure to comply with a rule, practice direction or court order. The Judge's decision was founded both on (b) and on (a). He firstly held that continuation of the claim would be an abuse of process because Mr Tinkler's essential complaint had already been substantially litigated in proceedings between him and Stobart Group Ltd. (‘the Company’). That action in the London Circuit Commercial Court (‘the Stobart Action’) had led to a judgment given by HH Judge Russen QC, sitting as a Judge of the High Court, (‘the Russen Judgment’) on 15 February 2019. The Judge secondly found that the claim should be struck out because Mr Tinkler did not have a properly arguable case that he had probably been caused pecuniary damage as required by s. 3 (1) Defamation Act 1952. Finally, the Judge noted the court's power to strike out an action on the basis that it does not disclose a substantial tort and that the litigation would be pointless and wasteful, as explained by this court in Dow Jones & Co Inc v Jameel [2005] QB 946, but he did not express a conclusion about that in the light of his other findings.

3

On this appeal Mr Tinkler challenges, as he must, both of the Judge's reasons for striking out his claim. I will summarise the background and procedural history, the Judge's decision and the applicable law before turning to the arguments on appeal and my conclusions.

The background and procedural history

4

The Malicious Falsehood Action arises from a boardroom battle that erupted in 2018. At the time, Mr Tinkler was a substantial shareholder and a director of the Company. Of the Respondents, Mr Ferguson was the chairman, Mr Brady the CEO, and Mr Coombs and Mr Wood were non-executive directors. Mr Tinkler believed Mr Ferguson should not continue as chairman. The Respondents disagreed and a power struggle followed, with both camps courting shareholder support. In the end, Mr Tinkler was dismissed as a director and employee on 14 June 2018 and Mr Ferguson was re-elected as chairman at the AGM on 6 July 2018.

5

On 8 June 2018, the Malicious Falsehood Action was launched against the Respondents and one other individual who is no longer concerned with the appeal. Mr Tinkler sought redress for the publication by the Company on 29 May 2018 of an announcement on the London Stock Exchange's Regulatory News Service (‘the RNS Announcement’), which he claimed was defamatory of him and published maliciously. It followed an earlier RNS announcement on 25 May 2018 which gave notice that a boardroom battle was in progress. The first announcement was published on a Friday at 16.51, the second at 14.41 on the following Tuesday after a Bank Holiday.

6

On 15 June 2018, a week after the RNS Announcement, the Stobart Action was launched by the Company, seeking declarations vindicating its dismissal of Mr Tinkler. He counter-claimed for declarations that his removal was invalid and sought an order for reinstatement. Each side accused the other of foul play. The Company alleged an unlawful means conspiracy by Mr Tinkler with others to oust the chairman, and breaches by him of his duties as a director and an employee. Mr Tinkler claimed that the Respondents had acted in breach of their fiduciary duties as directors in a number of specific respects.

7

Because it concerned the control of a publicly-quoted company, the Stobart Action was expedited and a trial lasting eleven days took place in November 2018. In his judgment at [2019] EWHC 258 (Comm) HHJ Russen QC ruled on ten issues arising from the activities of the competing factions between November 2017 and July 2018. These issues, with their various sub-issues (some fifty in all), are set out in the Russen Judgment at [50] and the outcomes of each are found at [947] onwards. In summary, Judge Russen QC rejected the Company's claim that Mr Tinkler had engaged in a conspiracy, but found that he had acted in serious breach of his fiduciary and contractual duties and that his dismissal as an employee and removal as a director had been lawful and valid. He found that the re-election of Mr Ferguson was not invalid. He further found that, save in one respect, the Respondents had not acted in breach of their fiduciary duties.

8

Issues 3 and 4 are of particular relevance to the Malicious Falsehood Action:

“3. Was Mr Tinkler in breach of his fiduciary and/or contractual duties (and if so what is the nature and seriousness of the breach) by reason of any or all of the following?

a. His proposal in relation to the Flybe transaction.

b. Speaking to the Claimant's significant shareholders and criticising the Board's management and the Group's business and agitating for the removal of Mr Ferguson.

c. Entering into an unlawful means conspiracy with any of Mr Hodges, Mr Woodford, and/or Mr Day.

d. Improperly sharing Confidential Information (as specified at paragraphs 21, 22 and 33(c) of the Particulars of Claim).

e. Writing to shareholders and employees on 8 and 9 June 2018 respectively.

f. Orchestrating:

i. The writing of a letter of support from the Executive Leadership Team.

ii. A petition by group employees.

g. Making comments about the level of his remuneration in comparison to the previous Executive Chairman, who is a woman, and/or using inappropriate language in so doing.

4. Were the Four Directors in breach of their fiduciary duties by reason of any or all of the following?

a. Attempting to use Article 89(5) to remove Mr Tinkler as a director in February 2018.

b. Establishing the Board Committee.

c. Issuing the 29 May 2018 RNS.

d. Declining to put Mr Day's name forward for the AGM Ballot.

e. Purporting to dismiss Mr Tinkler as an employee on 14 June 2018.

f. Purporting to remove Mr Tinkler as a director on 14 June 2018.

g. Causing the transfer of shares from Treasury to the EBT.

h. Not causing shares which should have been vested in Mr Tinkler and other employees to be transferred to them in advance of the AGM.

i. Not putting Resolution 4 to re-elect Mr Tinkler to a vote at the AGM.

j. Casting proxy votes from shareholders who had indicated that they wished to abstain on Resolution 4, against the A.O.B. resolution to elect Mr Tinkler.

k. Purportedly removing Mr Tinkler as a director again immediately following the AGM on 7 July 2018.”

9

Judge Russen QC found against Mr Tinkler on Issues 3 (b), (d) and (e) and on Issue 4 as a whole, with the exception of Issue 4 (g). For our purposes, the rejected allegation at Issue 4 (c) concerning the RNS announcement is of particular importance. Consistently with his approach to each issue, Judge Russen QC dealt with it in considerable detail. His conclusions at [785 – 794], which must be set out in full, spared neither faction:

“785. The next matter of challenge is their decision to issue the 29 May RNS. This followed the 25 May RNS with its more neutral wording, as revised following Mr Tinkler's objection to certain tendentious statements during the Board earlier that day. I have set out the material terms of the 29 May RNS in section 3 above. Mr Tinkler says that, as the earlier one had fulfilled the Company's regulatory obligations, the 29 May RNS was unnecessary and misleading. He says that, if anything further needed to be said on the issue of the chairmanship, it should have been said in explanatory statements (reflecting each side's position) in advance of the AGM. As I have noted, Mr Tinkler has commenced libel proceedings against the Four Directors on the back of the 29 May RNS.

786. It is clear that the terms of the 29 May RNS reflected the advice of Mr Arch (of Stifel) on 26 May that a “ hard-hitting announcement” was required. The RNS was certainly that with its references to the “ challenges” which Mr Tinkler had posed “ in the recent past”.

787. It is not for me to trespass upon matters which are to be decided in the libel proceedings. I have well in mind Mr Hodges' view about the RNS, which is that it was a “ fundamentally dishonest” document. At the time, having read it that day, Mr Brown also thought it was “ misleading” though, as the Company points out, Mr Tinkler may well have encouraged him to express that view. I have to decide, instead, whether the Four Directors acted in breach of fiduciary duty in causing it to be issued.

788. In my judgment, it was unwise and inappropriate for the Four Directors to...

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