“Your report should cover the following areas: - Your opinion of: - 1. a current market value of the Properties assuming a willing buyer and a willing seller within a reasonable time period. 2. a current market value assuming a willing buyer and willing seller assuming a sale within 6 months as may be considered acceptable for security purposes. A “forced sale mortgage valuation”
“This report is prepared in accordance with previously agreed Conditions of Engagement which are recited in Appendix 1 to this document.”
“Unless otherwise instructed, the value given is the “Open Market Value” defined as the best price at which the Property .... might reasonably be expected to be sold by private treaty at the date of the Tretheweys valuation assuming: 4.1.1. a willing seller; 4.1.2. a reasonable period in which to negotiate the sale taking into account the nature of the Property .... and the state of the market; 4.1.3. that values remain static during that period; 4.1.4. that the Property .... is freely exposed to the open market; and 4.1.5. that no account is taken of any additional bid by a purchaser with a special interest.”
“.... a report and valuation by independent valuers showing a minimum forced sale valuation of [the Properties] of£3,500,000 ....”
“In accordance with our above-mentioned telephone conversation, we write to confirm that our valuations as contained in [Mr McLaughlin’s report] were undertaken on an “open market” basis, in accordance with our Conditions of Engagement, as appendixed to the [report]. The valuations were not provided upon a “forced sale” basis.”
“... all or any liability under the alleged guarantee is denied. Our clients are at the moment formulating a very substantial claim for damages against [the Bank] and the papers are with counsel. Our clients have received Legal Aid to bring proceedings and had your letters under reply not been received those proceedings would have been issued and served upon you in the near future. We therefore formally advise you that any action which you are misguided enough to bring against our clients on behalf of the Bank will be strenuously resisted and met with a substantial counterclaim far exceeding the amount of any guarantee liability which you allege.”
“On receiving [Mr McLaughlin’s report], I was concerned to confirm that the basis of valuations stated to be “with vacant possession” corresponded with the “forced sale mortgage valuation” referred to in paragraph numbered 2 on the first page of Peter Hargreaves’ letter of17 March 1992 . I therefore telephoned Mr McLaughlin of Tretheweys who confirmed to me that their “vacant possession valuation” was his firm’s phraseology for a “forced sale valuation” within the terms set out in Mr Hargreaves’ letter.”
“No such telephone conversation .... ever took place. It is true that Mr Murphy did speak to me on the [telephone] .... but the import of those telephone conversations was very different from that deposed to in his Affidavit. In particular I could never have said, as is alleged, that “vacant possession valuation” within the [context] of my valuation report was my firm’s phraseology for the expression “forced sale valuation” as used by Mr Hargreaves in his letter of instruction. The two terms are contradictory[:] “Vacant possession value” excludes any element of “forced sale” in its quantification. The term “freehold with vacant possession valuation” is clearly and succinctly defined in paragraph 4.3 and 4.1 of Appendix 1 which accompanied the [report] to mean the best price at which the property .... might reasonably be expected to be sold by private treaty at the date of the valuation on the basis set out in paragraph 4.3. I cannot accept that Murphy could conceivably have believed otherwise.”
“The [Bank] received a copy of [Mr McLaughlin’s report] on26 March 1992 . On or shortly after that date, Mr Murphy had a telephone conversation with Mr Douglas McLaughlin who compiled the report on Tretheweys’ behalf. In the course of that conversation, Mr McLaughlin confirmed to Mr Murphy that what Tretheweys called a “vacant possession” valuation was their phraseology for a “forced sale” valuation.”
“.... acquired two non-viable assets [sc. The Blue Lagoon and The Tall Trees Night Club], its whole business failed and its shares became worthless.”
“It is the latter date which, in my judgment, is implicit in Mr Sutcliffe’s submission. There is nothing in the words of the section to suggest that the power to suspend limitation exists in favour of a creditor, yet there is no like power to suspend limitation in respect of the company’s claims.”
“The learned District Judge decided that in the circumstances he would suspend the effect of the limitation period despite the fact that the primary limitation period had run out on31 March 1998 , some months before the dissolution of the company. Mr Amos says this is a case where effectively the Bank have been caught with their pants down and they need their backside smacked, and so therefore the order made by the District Judge was quite correct. He has, however, to deal with the fact that the law has to be seen to be approached equally between the parties. He has to deal with the question as to why it was that the company was not joined in the proceedings back in 1995, when the basic factual allegations were known to him and to Mr Barton, and formed the basis of extensive pleadings in the guarantors’ Defence and Counterclaim [in the Guarantee action]. True it is that the Bank has been found guilty of a fraudulent misrepresentation, but that is something which can still remain a defence to any claim brought by the Bank against the company. There is no limit to defending actions brought against the company. It seems to me that this is a case which has now gone on far too long. These are events which took place some ten years ago. The issues have been litigated already up to the House of Lords. In my judgment, the submissions made by Mr Sutcliffe, which are to the effect that a distinction should be drawn between creditors on the one hand and the company on the other, is a valid distinction. The creditors do not have control over the company. In this case, however, the members are the controlling shareholders and directors of the company, and in my judgment on the information before this court they have at all times [had] the relevant knowledge with which to bring a claim in the name of the company against the Bank. In my judgment in those circumstances the District Judge should not have exercised his discretion in the way that he did. He should have drawn a line under this long-played-out battle, and he should have resisted the temptation to make the order that he did. Indeed, had the defendants been present and had the full facts been before the District Judge, as they are now before this court, I have no doubt that he would not have made the order that he did.”
“Parliament has indeed sought to protect those who have been the subject of fraud and concealment, and Parliament has made it plain that the limitation period shall not begin to run prior to any facts relevant to the right of action having been revealed to the claimant. In my judgment the relevant material was within the company’s knowledge at or shortly after September 1993 and, although I reach this conclusion with some regret and with considerable sympathy for Mr Amos who has presented his case with skill, I am unable to decide in any other way than to accept the Bank’s submissions and to apply the Limitation Act. Accordingly, I summarily dismiss the claim under Part 24.”
“What is sought is a provision that will preserve to the creditor the rights that he acquired while the company was defunct. The statutory fiction that results from an order under the subsection is that the company continued in existence throughout; and this, with all that flows from it, is the necessary consequence of the order. One of the consequences is that any liabilities properly incurred by a director in the name of the company would be liabilities of the company and not of the director. What the concluding limb of the subsection empowers me to do is to give directions or make provisions for placing the company and others in the same position as nearly as may be as if the name of the company had not been struck off. What counsel for the supporting creditor seeks is a direction or provision putting him in the same position as if the company had been struck off, as in fact it was. In other words, he seeks a direction or provision which will negative the statutory fiction, whereas all that the subsection empowers me to do is to give a direction or make a provision which supports and carries out the statutory fiction as nearly as may be. I do not see what power I have to include such a direction or provision in the order.”
“.... the final sentence confers a special power to add where necessary to the order of restoration special directions designed to achieve .... a putting back of the clock, an achieving of what Lord Sumner [in Morris v. Harris[1927] AC 252 ] called an ‘as you were position’ between the company and third parties.”
“For my part, I think the words of s.353(6) are clearly designed to produce an ‘as you were’ position, and I think that the latter part of the subsection is complementary and intended to provide for cases where provision is necessary in order to clarify an obscure position or give back to the company an opportunity which it might otherwise have lost.”
“.... one has to consider the position as at the date of dissolution of the company and not at the date of restoration.”
“.... what I have to do is put all other persons – not only the company, but all other persons – in the same position as nearly as may be as if the name of the company had not been struck off. At the date of the dissolution, the creditors .... who were not statute-barred at the date of dissolution .... could have stopped the statute running by issuing, possibly serving, a writ. [Counsel for the petitioner] contends that the creditor could also have applied to restore the name of the company to the register and then have issued his writ. Of course he could, but that is not the same position, nor is it, in my judgment, the nearest that can be done to get to the ‘as-you-were position’; and it seems to me that, when a company has been dissolved and therefore nobody can sue it without getting it restored to the register, it is only common fairness that, if the contributories for purposes of their own, want to get it restored to the register years afterwards, the period [of dissolution] should be disregarded for the purposes of the Statute of Limitations. .... Common justice requires that some such provision should be inserted.”
“The court will usually make the order [for restoration] if there is any business or property to be dealt with, but on the terms that all proper returns are to be made. However, no application to set aside or modify an order for restoration to the register may be made except on behalf of the company, and then only if there is some evidence that the board or the company in general meeting has considered the matter.”
“[Section 653(2B)(c)] gives to the court a wide discretion and enables the court to take into account the rights of third parties that may be directly affected. In my view it is desirable that the appellants be added so that the court can be fully informed of their rights and take [them] into account before deciding whether it is just for restoration to be ordered. In my judgment it is desirable, if justice is to be done and seen to be done, that the appellants are added to these proceedings so that the court can resolve whether registration should be ordered. To conclude to the contrary would mean that rights directly affecting the appellants would be decided without their being able to be heard upon the issue of whether restoration was just. That in my judgment is not desirable.”
“As Aldous LJ has said, s.653(2B) gives the court a wide discretion as to whether to allow restoration, particularly where one of the grounds relied on is that it is just to do so. The fact that the landlords will, it is to be assumed, lose their right to possession of the clubs if the company is restored must, it seems to me, be relevant to the exercise of this discretion. This being so I do not think the rules preclude the court from allowing the landlords’ intervention. They are drawn in wide general terms to ensure that parties whose rights may be affected by a particular decision have a right to be heard. They are based on principles of natural justice. Looking at the CPR I would say that prejudice to the landlords is an issue connected to a matter in dispute in the proceedings, namely the restoration of the company to the register. It is desirable that landlords should be allowed to intervene because if they are not to be heard before the decision is made they never will be. If the company is restored it will be too late. .... I should add that it will still be for the court to decide in any particular case whether or not to allow intervention. It could I think quite properly only allow intervention in cases where the order for restoration itself would or might directly affect the rights of the intervener.”
“Finally, as a matter of general practice it seems to us that where a restoration order is sought in the Companies Court by a prospective claimant in a personal injuries action, a section 651 direction [i.e. a limitation direction under that section] should not normally be made unless (a) notice of the application has first been given to all those parties who may be expected to oppose the making of such a direction, including the company’s insurers, and (b) ..... the court is satisfied (i) that it has before it all the evidence which the parties would wish to adduce on an application by the prospective claimant under section 33; and (ii) that an application under section 33 would be bound to succeed.”
“Proof of loss attributable to a breach of the relevant duty of care is an essential element in a cause of action for the tort of negligence. Given that there has been negligence, the cause of action will therefore arise when the plaintiff has suffered loss in respect of which the duty was owed. It follows that in the present case such loss will be suffered when the lender can show that he is worse off than he would have been if the security had been worth the sum advised by the valuer. The comparison is between the lender’s actual position and what it would have been if the valuation had been correct. There may be cases in which it is possible to demonstrate that such loss is suffered immediately upon the loan being made. The lender may be able to show that the rights which he has acquired as lender are worth less in the open market than they would have been if the security had not been overvalued. But I think that this would be difficult to prove in a case in which the lender’s personal covenant still appears good and interest payments are being duly made. .... Relevant loss is suffered when the lender is financially worse off by reason of a breach of the duty of care than he would otherwise have been. This is, I think, in accordance with [UBAF] ....”
“.... insufficient, for the purpose of establishing liability on the part of the valuer, to prove that the lender is worse off than he would have been if he had not lent the money at all.”
“.... the word ‘fraudulent’ in connexion with conversion, however important it may be in a criminal matter is, in the civil action of conversion, so far as regards the cause of action, nothing more than an abusive epithet.”
“A living person has a mind which can have knowledge or intention or be negligent and he has hands to carry out his intentions. A corporation has none of these: it must act through living persons, though not always one and the same person. Then the person who acts is not speaking or acting for the company. He is acting as the company and his mind which directs his acts is the mind of the company.”