Hague Plant Ltd v Hague & Ors [2017] EWHC 2021 (Ch)

Case No 2LS30214[2017] EWHC 2021 (Ch)
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
Venue Royal Courts of Justice, Strand, London, WC2A 2LLDate 02/08/2017
Before
Mr JUSTICE NORRIS
Between
Hague Plant LimitedClaimant
Christopher Parker QC (instructed by Walker Morris) for ClaimantGregory Pipe (instructed by Shulmans LLP) for First and Third DefendantsMargaret Griffin (instructed by Kieran Clark Green) for Second DefendantHearing Hearing date: 16 May 2017
JudgmentThe Hon Mr Justice Norris :
[1]This action commenced on 23 June 2011. On 26 October 2016 I handed down judgment (“the Issues Judgment”) determining issues (“Issues”) in relation to one of the defences advanced by the Defendants. The first 17 paragraphs of the Issues Judgment set out the background to the proceedings and summarise some of the key issues. I shall take that as my starting point for this judgment.[2]In paragraph [14] of the Issues Judgement I referred to a historic dispute over proposed amendments to the Particulars of Claim in this action (which HHJ Behrens had ruled against in March 2014, which ruling was upheld by the Court of Appeal in December 2014). In paragraph [8] I referred to the commencement of yet further proceedings (“Hague 6”) which were designed to advance the claims for which permission to amend had been refused by HHJ Behrens.[3]There is now before me an application by the Claimant seeking once again to introduce into this action some of the amendments for which permission was refused in 2014. Although that summary might indicate that such application is barely worthy of consideration, there is a little more to it than meets the eye: and it must be approached in accordance with the guidelines usefully summarised in Quah Su-Ling v Goldman Sachs International [2015] EWHC 759 at [38].[4]In consequence of my findings and holdings in the Issues Judgment it is accepted that the action cannot proceed to trial on the Particulars of Claim as pleaded, and that substantial deletion is required. But the Claimant is unwilling to excise from the statement of case claims that are bound to fail unless it is permitted to introduce amendments which put its case another way (a move I think is designed to build a position on costs in relation to the trial shortly to be listed). The justification is said to be a fundamental change in Defendants’ position which only emerged in the hearing of the Issues.[5]The draft Re-re-amended Particulars of Claim (produced after an unexplained delay since the Issues Judgment) contain some minor amendments that are not contentious. They are to paragraphs 9, 13, 20(1A)(i): and I permit them. Some deletions are not contested. They were identified in a letter dated 24 March 2017: and I permit them. But there is a hotly contested recasting of the case(a) to allege “reckless” breach of fiduciary duty (in addition to the hitherto-pleaded dishonest deliberate and conscious breach of fiduciary);(b) to delete significant breaches of duty (unexceptionable insofar as they reflect the Issues Judgement and do not facilitate the pleading of an otherwise inconsistent case) and to make corresponding reductions in the sums claimed;(c) to substitute new breaches relating to (i) the receipt by the Third Defendant (“Excavations”) from third parties of fees for leaving waste material at Carlisle Street (ii) the levying of charges by Excavations on the Claimant (“Plant”) for leaving waste at Carlisle Street (iii) causing Excavations to benefit at the expense of Plant even if the First Defendant (“Martin”) was acting in good faith (iv) the appropriation of a corporate opportunity by Martin for Excavations (vi) the alleged dishonest assistance of the Second Defendant (“Jean Angela”) in agreeing that Excavations should benefit at the expense of Plant in the manner indicated;(d) to reformulate completely the sum claimed (reducing it from £17.76 million to “in excess of £2.5 million”) and the nature of its calculation to focus upon charges levied by Excavations against Plant (for what is described as depositing its own waste) and against third parties (for depositing their waste which would be processed by Plant);(e) to make a new allegation of deliberate concealment against each of the Defendants (supported by citations of various statements made by Martin and Jean Angela in the course of the proceedings) and to revise the date upon which it is said the limitation period began to run.[6]The significance of these amendments, made six years into the currency of the proceedings and shortly before an imminent trial, will be readily apparent. I shall not grant permission for them to be made.[7]First, the same allegations as are proposed to be introduced into this action by amendment are made in Hague 6 (which is currently stayed pending the determination of these proceedings). The commencement of Hague 6 was Plant’s response to the refusal by HHJ Behrens and the Court of Appeal to permit these present (and other) amendments to be included in the originally proposed Re-re-Amended Particulars of Claim. I make no assumptions about whether Plant may prosecute Hague 6: but the existence of separate proceedings by choice of Plant provides a sound reason for not duplicating issues.[8]Second, the introduction of these allegations will mean that the present proceedings will be derailed six years after their inception. Having reached the point where (as a result of the Issues Judgment) the remaining issues for decision are clear cut, all the advantages of that are to be abandoned, and what is in effect a substantially different case is to be commenced and the timetable completely recalibrated. Much work will have been wasted and much work remains to be done.[9]Third, this is on any footing a late application to amend (made whilst a trial date is being fixed and when a date has been set for exchange of witness statements), and I am not persuaded that the circumstances justify it. Plant has had many, many years to think about how to put its case. It now wishes to change tack. It seeks to justify that by saying that the move is purely responsive to a change in the description of the business model by Martin and Excavations. But as to that:-(a) When this argument was run before the Court of Appeal in relation to the unsuccessful amendment application Briggs LJ said (at [2014] EWCA Civ 1609 paragraphs [35] to [38]) that the changes suggested were greatly exaggerated. Having lived with this case, I agree.(b) The essentials of Excavations’ case have always been known (though the legal language used by lay people to describe it has varied). Plant pays a (reduced) charge to dump on Excavation’s land (a fee which Plant says was charged for “doing nothing more than owning Carlisle Street”). Plant recycles the waste. Plant sells the recycled product and keeps the proceeds. As it was pleaded on behalf of the Defendants in October 2012:
“To the extent that [Plant’s men and equipment] were involved in landfill activities on behalf of Excavations, the quid pro quo for this activity was either payment or the provision of advantageous tipping facilities and rates by [Excavations] to [Plant]… To the extent that [Plant’s men and equipment] were deployed for recycling activities they were undertaking a business activity on behalf of [Plant]…”
. So that has been the known position for 5 years. (c) The question has always been as to the commerciality of that arrangement. Plant chose to challenge on one basis (that Plant should be treated as a sub-contractor): they do not like the potential outcome of that and now want to mount a different challenge, namely that the possibility of receiving fees for using Excavation’s land was a corporate opportunity that should have been given to Plant because it was conducting the processing (though it should be observed that just such a plea was included in the Claim Form but abandoned in the Particulars of Claim eventually served). This desire to mount a different challenge results from the outcome of the Issues Judgment, not from a change of case by Martin. (d) As Mr Parker QC himself acknowledges in his skeleton argument “The Ds insist that they are not saying anything new and that what they say each of the two companies did at Carlisle Street has not changed…That is true up to a point: but what has changed is their explanation as to why matters were arranged as they were….”. But it is the arrangements themselves that give rise to the cause of action. (e) Excavations has from the outset of the dispute acted on the footing that Plant was not simply a sub-contractor but that the recycled product was the property of Plant. When the rift came in 2009 (and Excavations was seeking to dissuade Plant from withdrawing from Carlisle Street) it made plain in correspondence that if no new contract could be entered “you will need to remove all your materials from our Carlisle Street premises”. Plant chose in its original Particulars of Claim to ignore this event and instead to focus on its own textual analysis of various statements by Martin. That having failed to produce a sustainable case, Plant cannot at a late stage now say that it is Excavations that has changed its position.[10]Fourth, the amended claim must surmount significant limitation hurdles: Plant has not addressed them in the way the Court might expect in the light of Mercer v Ballinger [2014] EWCA Civ 996. I do not accept that the amended case is “fundamentally the same claim” with only the remedy altered. I have not been persuaded that the limitation defences to the reformulated claim are not reasonably arguable. It is clearly preferable that limitation questions are addressed in Hague 6 (rather than on an amendment application).[11]Fifth, to permit the amendment will (as I have indicated) disrupt the present case plan, and (if a fair opportunity is to be given to the Defendants) will postpone the resolution of this 6 year old case for an unacceptably long time.[12]It is common ground that a heavy onus lies upon Plant to justify its amendment (Swain- Mason [2011] EWCA Civ 14 and Carey Group v AIB Group (UK) plc [2011] EWHC 594). In my judgment Plant has signally failed to discharge it. Those amendments to which the Defendants consent are permitted. The application is dismissed as regards the remainder. An amended pleading must be served by 4.00pm on 1 September 2017.[13]There remains the question of an outstanding Part 18 Request (ordered to be answered notwithstanding that an application to amend was foreshadowed). It remains unanswered by deliberate decision of Plant and its advisers. The Claim will be struck out and the Defendants will be entitled to their costs of the action unless it is answered by 4.00pm 1 September 2017.[14]My provisional order on costs is that Plant shall pay the costs of the Defendants those costs to be assessed on the standard basis. If my provisional order is not acceptable or if the Defendants want a summary assessment or a payment on account then I should receive short written submissions by 15 September 2017.

Cited in 1 later judgment