“Ameer provided knowingly inflated measurements of the cladding and render to IQEQ (via Mr John), for the purpose of putting any independent expert off the scent.”
“all reasonable proper and incidental costs of the purchase including any relevant purchase taxes, statutory levies or registration fees and/or professional charges incurred in connection with the acquisition as set out in a development appraisal attached as Appendix 1.”
“shall manage the daily operation of the Joint Venture and make decisions (including the appointment of all contractors) through his UK construction company in the best interest of the Joint Venture”
“12.2 Good Faith 12.2.1 Each party shall at all times act in good faith towards the other and shall use all reasonable endeavours to ensure that this Agreement is observed. Clause 12.2.2 each party shall do all things necessary and desirable to give effect to the spirit and intention of this Agreement.”
“when considering the interpretation and meaning of an express good faith clause in context, cases from other areas of law or commerce, which turn upon their own particular facts, may be of limited value and must be treated with considerable caution.”
“manage the daily operation of the Joint Venture and make decisions (including the appointment of all contractors) to his UK construction company in the best interests of the Joint Venture”
“The circumstances in which fiduciary duties arise have therefore also been described in the following way: “The concept encaptures a situation where one person is in a relationship with another which gives rise to a legitimate expectation, which equity will recognise, that the fiduciary will not utilise his or her position in such a way which is adverse to the interests of the principal.”
“Mortgagees, tenants in common, banks, employees, doctors and professional advisers do not ordinarily owe fiduciary duties. In other words, these are not settled categories of fiduciaries. But it is possible for the circumstances of the relationship between such a person and the other party to the relationship to justify the imposition of fiduciary duties, provided those circumstances are such that it is reasonable to expect that the first person (the fiduciary) will subordinate his interests and act solely in the interests of the other (the principal). Thus, for example, a local branch manager of a bank has been held to have acted in a way that led his customer reasonably to expect that the bank was providing advice as to the wisdom of a proposed transaction in the customer’s interests, rather than in the interests of the bank. A manager has been held to owe fiduciary duties. …. Joint venturers have been held to owe fiduciary duties to one another, but not all joint ventures necessarily involve such duties. While it has been suggested that joint ventures may be “inherently fiduciary” because of their similarity to partnership, the term “joint venture” is a business term “which does not have a precise legal meaning”
“… the extent and nature of the fiduciary duties owed in any particular case fall to be determined by reference to any underlying contractual relationship between the parties. … The existence of a contract does not exclude the co-existence of concurrent fiduciary duties (indeed, the contract may well be their source); but the contract can and does modify the extent and nature of the general duty that would otherwise arise.”
“The categories of fiduciary relationship are not closed. There may be such a relationship where all the circumstances justify a finding that fiduciary obligations are owed. Identifying the kind of circumstances that produce that result is difficult. The decisions of the courts have sought to retain flexibility as to the approach to be adopted. Numerous academic commentators have offered suggestions but none has gathered universal support. There is said to be growing judicial support for the following two propositions: (1) a fiduciary is someone who has undertaken to act for or on behalf of another in a particular matter in circumstances which give rise to a relationship of trust and confidence; (2) the concept encaptures a situation where one person is in a relationship with another which gives rise to a legitimate expectation, which equity will recognise, that the fiduciary will not utilise his or her position in such a way which is adverse to the interests of the principal.”
“… it is not a breach of such a duty for the operator to pay an expense which is properly payable, or which is in any event agreed to be paid, but if a fiduciary duty exists at all, it throws the burden on the party subject to the duty to justify any payment in any case where there is any doubt as to whether it was properly made.”
“I recognise that joint venturers may or may not have a relationship in which one of them owes fiduciary duties to the other. The question, to my mind, is whether the circumstances of their relationship justify the imposition of such duties, and in answering that question it is often helpful to consider whether, to adopt the words of Millett LJ in Bristol and West Building Society v Mothew[1998] Ch 1 at 18, one joint venturer has undertaken to act for or on behalf of the other in a particular matter or circumstances which have given rise to a relationship of trust and confidence.”
“The basis of this aspect of the claim is not simply the fact that Mr Miller and Mr Farrar were shareholders in Saxon or Artillery; nor simply the fact that Mr Miller was a director of Artillery. It is that the parties had been in business together as property developers for very many years and it was in that context that Mr Miller was entrusted with the corporate aspects of the parties’ joint ventures and was specifically given or assumed the responsibility of transferring Long Stratton from Saxon to Artillery and then from Artillery to the Joint Venture entity. It was only as a result of that relationship of trust that Mr Miller was able to transfer Long Stratton out of Artillery to Edged Red, the means by which he thereafter denied Mr Farrar any interest in Long Stratton or its traceable proceeds. I appreciate that these allegations are heavily contested by Mr Miller but Mr Sibbel submits and I agree that, if made good at trial, it is arguable that they did indeed give rise to the fiduciary relationship for which Mr Farrar contends.”
“… that bribery is an actionable wrong at common law, as well as in equity, for which common law remedies, as well as equitable remedies, are available.”
“While it may sometimes be appropriate to describe a duty to give disinterested advice or information as “fiduciary”, it is not necessary to do so. It is the content of the duty, not the label attached to it, that matters.”
“unquestionably correct to hold that, on the basis of the broker’s terms and conditions and on the basis of the findings of fact at first instance, the broker owed duties which engaged the law applicable to bribes and secret commissions. It was under a duty to make a disinterested selection of mortgage product to put to its client in each case. To the extent that it is necessary, they were also correct to hold that the broker owed a fiduciary duty of loyalty to Mrs Wood and Mr Pengelly in the performance of its duties. As I have indicated in relation to the first issue, it matters not whether that duty is characterised as “fiduciary”, either in a loose sense or at all.”
“87. … it was part of the credit broker’s role in these cases to provide information to the lenders on the customer’s behalf, and to the customer about the available finance. The very nature of the duties which the credit broker undertook gave rise to a “disinterested duty” unless the broker made it clear to the consumer that they could not act impartially because they had a financial incentive to put forward an offer from a particular lender or lenders. The broker could do this, for example, by saying: “I may offer you a product which may be chosen because it benefits me directly, even though it may not be the best product for you. Are you happy with that?”
“I am happy with 50/50 relationship & 55/45 shareholding, based more on our long standing relationship and trust, I am basing this on a understanding between the two of us that you are in agreement for me to manage, handle and make decisions on this project. Naturally I will consult with you but you must allow me the freedom to make decisions without having to constantly revert back to you. I believe this level of flexibility, which is based on trust primarily, must be there for the business to follow the right course…”
“I have no idea about building, you will be responsible and totally in control.”
“…I just thought it may be useful at this stage to further clarify our understanding of what your role would be as directors on behalf of the beneficial owners and acting under the terms of the JV partnership between myself and Pradeep. On the construction phase of any development or any other business agreed within the JV, for either Viper ltd and Valtrom you would be responsible for taking instructions from myself and Saira under the terms of the JV agreement and ultimately to Pradeep, Sangita and myself and Saira as the beneficial owners. Please let me know if this would be your understanding, the above instructions would follow whatever is in the best interest of the Company/Companies.” iii) Much later, in an email dated13 June 2020 , Mr Mirza wrote to Mr Lewin and Mr Stobart, in response to Mr Stobart’s request for the underlying quotations from subcontractors, in the context that the Directors had just been informed that the price for replacing the cladding and rendering the building had increased to£2,545,763.70 inclusive of VAT in the following terms: “In keeping with how I've operated in the best interest of Otaki (since 2007 when we agreed the arrangement) I've kept you and your colleagues (on behalf of Otaki) fully informed with the development decisions/management (clause 5.2.2) that I am authorised by the joint venture to take through my development company (clause 5.2.1). Pursuant to this (and as I have always done) I've given you full information on the cladding (as I did on the11th June 2020 ) which resulted in the approval of the development arrangements with Tydwell (my development company). I have therefore fulfilled the requirements of the joint venture and followed the pattern of approval we have done many times in the past.”
“I do remember [Mr Morjaria] saying, ‘Possibly, if you can, below slightly market rate, but it must not be above what the valuation - the bank's valuer quote, then I don't care whether you build the building for a pound, or you build it for whatever, whatever you make in there I'll just leave it up to you’. That is what we actually said.”
“13.1 This Agreement, and any documents referred to in it or executed contemporaneously with it, constitute the whole agreement between the parties and supersede any previous arrangement, understanding or agreement between them relating to the subject matter they cover. 13.2 Each party acknowledges that in entering into this Agreement, and any documents referred to in it or executed contemporaneously with it, does not rely on, and shall have no remedy in respect of, any statement, representation, assurance or warranty of any person other than as expressly set out in this agreement [sic] or those documents.”
“The development will be carried out by Tydwell Ltd (UK Company) who will invoice Krugar and Viper in proportion to the work carried out.”
“…the bank was in agreement that Tydwell could receive£350,000 during the course of the project as it considered that Tydwell should be entitled to a profit and charge fees for its services and thereby ensure that there was continued engagement from Mr Mirza in managing the project. The bank wanted to make sure that Tydwell as the developer/builder would remain solvent and profitable as its failure could potentially affect the delivery of the project and, as Mr Mirza and Tydwell were central to the success of the project, this was of paramount importance.”
“any sums to be paid by the Employer to the Developer in respect of the Developer's costs in properly performing its obligations under this Contract, provided that any such sums have been previously approved in writing by the Funder's Surveyor.”
“The Developer on such dates as agreed between the parties present to the Employer an application for payment of an instalment of the Fee commensurate with the services carried out in that month.”
“… Viper will enter into a procurement contract with Tydwell who will be the Building Contractor subcontracting the various aspects of the project to subcontractors (including Mace) and the Professionals…”
“… you have said so many times that we both are paying equally and that ‘I (Tydwel) [sic] am not charging anything am I’ Everything on Tydwell Invoice is what we have been billed. When I asked whether John sends all the backup invoices from all the suppliers, your immediate answer was, of course all back up invoices are sent to First Names, I hope this is the case. I need your reassurance that is the case so at least I don't rely on John and I take your word for it, we have always been totally honest with each other.”
“I presume Tydwell charged arm's length fees for the provision of development work and under contract? I also presume the directors of Otaki were inextricably involved in the negotiation and management of the process? Is Redwiredc [sic] Limited a connected company?”
“I have told him exactly the same about Tydwell”
“If not provided for in this Agreement, as may be agreed by the parties and, in the absence of such Agreement, on an arm's length basis.”
“mere silence, however morally wrong, will not support an action of deceit”
“The Claimants seek damages and other remedies in respect of wrongdoing carried out during the course of the joint venture by Mr Mirza, acting through and in concert with companies owned and controlled by him and certain family members and employees engaged by those companies. That wrongdoing included: “a. Dishonestly causing the joint venture vehicles to make payments totalling at least£6.8 million to Mr Mirza’s company, Tydwell, on the false basis that those payments were necessary to defray costs and expenses incurred (or to be incurred) by those companies in respect of legitimate goods and services obtained in pursuit of the joint venture, when in fact they have been simply misappropriated by those companies (or passed on to other companies wholly owned by Mr Mirza).£4,876,232 of the sum is now said by the Mirza Defendants to have comprised previously undisclosed “fees”, to which Tydwell was not entitled.”
“52. The process for requesting payment and the payment of invoices raised by Tydwell was routinely as follows: a. Mr John would send an email to one or more of the directors or employees of IQEQ (acting on behalf of the relevant JV Entity) setting out the sums required to be paid to Tydwell and the purported justification for the payment (the “Requests”). The email making the Requests would almost always copy in Mr Mirza and, in many instances, Mr Morjaria. The Requests would often also copy Mr Ameer Mirza and Mrs Mirza. b. An invoice from Tydwell raised to one of the JV Entities for the sum of the Request would either be attached to the email with the Request or, more often, would be sent by Mr John subsequently (the “Invoices”). c. The Requests would specify the total amount that would be required by way of contribution from the Joint Venturers to meet the sum sought from the relevant JV Entity. d. The representative of IQEQ would then pass on the request for funds to Mr Morjaria and Mr Mirza, usually by forwarding on the email received from Mr John and simply repeating his request for a contribution (on a 50/50 basis) in the amount stated. e. Mr Morjaria would then make the payment of the sum sought from Trafalgar to Otaki, which would then be transferred to Viper or Krugar as appropriate. Mr Mirza would, purportedly, make an equivalent contribution. Those contributions were recorded in the accounts of Otaki as shareholder loans. In the circumstances of the wrongdoing set out herein, the true quantum and source of any contribution made by Mr Mirza is a matter for which the Claimants seek an account (and appropriate injunctive relief) as set out below. f. The relevant JV Entity would then pay that sum (and any contribution from Mr Mirza or his companies) to Tydwell. 53. As to the Requests and Invoices, by way of summary, and without prejudice to the full terms of each of them: a. The Requests generally either set out a breakdown of the purported third-party costs and named the third parties to whom those sums were due or explained the nature of the third- party good or service purportedly provided and referred to the “costs” and “expenses” that Tydwell had incurred (or would incur) in respect of those goods or services. The following explanations (or terms to similar effect) were routinely used: “Tydwell has been incurring legal and design fees”; “building works/legal & Professional costs”; “costs incurred for the consultants and builders”; “fit out costs”; “funds for the Cabinets, Power Cables and IT equipment etc”; “expenses for the fit out”; “monthly operating costs”; “monthly operational expenses”; “ongoing expenses”; “monthly running costs”. b. The substantial majority of the Invoices raised by Tydwell were headed “Re: Professional/Consultants & Development Costs”; “Re: Professional/Consultants & Development Costs”; “Re-Fit out” or “Re: Operational cost”
“54. … the justifications provided for the sums sought by way of the Requests and the narrative explanations for the sums sought by way of the Invoices were such as to represent (expressly and/or impliedly) that: a. The sums sought were required in order to defray costs that had been properly incurred by Tydwell to third parties in furtherance of the JV (or, it was honestly believed, would be required to defray such costs); and/or b. The sums sought in respect of specified costs honestly and accurately reflected the sum which Tydwell had incurred (or which it honestly believed it would incur) in respect of those costs; and/or c. Tydwell honestly intended to use the sums sought in order to defray costs incurred by Tydwell to third parties in furtherance of the JV (collectively, the “Invoice Representations”). 55. The Invoice Representations were made on the face of the relevant Requests and/or Invoices. Alternatively, to the extent that any of the Requests or Invoices were ambiguous or silent as to the purported justification for the sums sought, the representations were made by implication that later Requests or Invoices were made/raised on the same basis as previously (and were thus also in respect of costs and expenses and not in respect of Tydwell’s fees). …. 60. The Invoice Representations were false and were made by the relevant Defendants knowing that they were false or reckless to whether they were true or false. As to this: a. By the Letter of Response, the Mirza Defendants have stated that£4,876,232 of the Misappropriated Sum, was not required to defray costs that had been properly incurred by Tydwell/Redwire to third parties in furtherance of the JV but instead was retained by Tydwell as “charges” or “fees” (the “Purported Fees”). b. The sum of the Purported Fees was calculated by the Mirza Defendants retrospectively by simply subtracting the total of the invoices said to have been raised against Tydwell purportedly in respect of the JV (the “Purported Underlying Invoices”), from the total amount paid by the JV Entities to Tydwell. c. Tydwell had no entitlement to charge “fees” to the JV Entities, whether pursuant to the JV/Tydwell Contracts or otherwise. Further and in any event, at no time did any of the Defendants inform the Morjarias or the JV Entities of the intention to charge such fees or seek their consent to do so, and no consent was ever provided. d. The Mirza Defendants have (contrary to their duties under the JVA) and despite requests to do so, failed to explain how the£4,876,232 of “fees” was charged, what of the sums sought by way of the Requests and Invoices represented those fees, or the basis on which these “fees” were calculated at the time they were purportedly charged. … Without prejudice to this it is averred that a proportion of the sums wrongfully extracted were extracted by inflating invoices purporting to defray specific third-party costs, as set out in respect of cladding below, and as follows [and examples are given] … 62. The Invoice Representations were made with the intention of inducing the JV Entities to make payments pursuant to the Invoices and Mr Morjaria to make financial contributions to the JV to fund those payments. The JV Entities and Mr Morjaria did rely on the Invoice Representations in that way.”
“51. Between 2007 and 2021, Tydwell sought and received payments from the JV Entities in the total sum of£32,498,099 .£27,932,964 of that sum was paid by Viper,£392,182 by Krugar and£2,697,339 by Otaki. Further, over the course of 2016 and 2017 Viper made, or was requested to make, payments directly to Redwire, pursuant to invoices raised by Redwire, in the total sum of£246,699 . Those sums were sought and paid (to the extent they were paid, which is a matter of expert evidence) notwithstanding that there was no contractual or other legal basis for payment of costs to Redwire.”
“c. Tydwell had no entitlement to charge “fees” to the JV Entities, whether pursuant to the JV/Tydwell Contracts or otherwise. Further and in any event, at no time did any of the Defendants inform the Morjarias or the JV Entities of the intention to charge such fees or seek their consent to do so, and no consent was ever provided.”
“56. The representations were made by Mr John acting on behalf of Tydwell and/or the Mirzas. Further or alternatively, it is to be inferred that Mr Mirza and/or Mrs Mirza and/or Mr Ameer Mirza, authorised, procured or directed the Invoice Representations and/or manifestly adopted and/or approved those representations. 57. As to Mrs Mirza, she: a. Was a director of each of Tydwell, Boomzone and Redwire and a shareholder of both Tydwell and Otaki; b. Actively participated in the financial management of Tydwell, Boomzone and Redwire and was responsible for making payments from those companies. c. Was named as the relevant contact or customer on third party invoices raised to Tydwell and relied upon by the Mirza Defendants as constituting third party costs incurred by Tydwell in furtherance of the JV; and d. Was copied in to emails by which the Requests were made. 58. As to Mr Ameer Mirza he: a. From 2016, worked for each of Tydwell, Boomzone and Redwire and was a director of Tydwell from20 February 2019 to9 September 2019 ; b. Was a qualified accountant, and participated in the financial management of Tydwell, Boomzone and Redwire; and c. From October 2016, was copied in to emails by which the Requests were made. 59. The Invoice Representations were made to the JV Entities. They were also made to Mr Morjaria, by virtue of Mr Morjaria being copied into the Requests and/or in that they were made with the intention and expectation that they would be passed on to Mr Morjaria such that he would make contributions into the JV necessary to cover the sums requested.”
“56.1 During the construction phase of the development, additional capital contributions were not required from Mr Mirza or Mr Morjaria as funding for the development was provided by Clydesdale. 56.2 Requests for payment by Tydwell were not invariably agreed to by IQEQ but would be the subject of discussion in relation to amount between Tydwell and representatives of IQEQ. 56.3 Ameer Mirza and Mrs Mirza were rarely (rather than often, as alleged in Subparagraph (a)) copied into Requests. Ameer Mirza only commenced as an employee of Tydwell on1 July 2019 and was not copied into emails before then.” 56.4 As to Subparagraph (e): (a) The first sentence is not admitted. Further, Mr Morjaria did not always provide the contributions requested of him. On such occasions, Mr Mirza made the contributions on his behalf (and on one occasion in 2009, accepted the transfer of a property in Cannes in lieu of payment). (b) The second sentence is admitted save for the word “purportedly”
“Where a false statement is made by a third person and passed by the defendant on to the claimant representee, the defendant may adopt and approve the statement and so make it his own. In such a case there is no difficulty with treating the defendant as a representor.”
“There may be said to be three types of representees: first, persons to whom the representation is directly made and their principals; secondly, persons to whom the representor intended or expected the representation to be passed on; and thirdly, members of a class at which the representation was directed.”
“it ought to be sufficient if in a transaction for the sale of land a vendor who has made an innocent misrepresentation corrects that misrepresentation by informing the purchaser's solicitors of the true facts.”
“In keeping with how I've operated in the best interest of Otaki (since 2007 when we agreed the arrangement) I've kept you and your colleagues (on behalf of Otaki) fully informed with the development decisions/management (clause 5.2.2) that I am authorised by the joint venture to take through my development company (clause 5.2.1). Pursuant to this (and as I have always done) I've given you full information on the cladding (as I did on the11th June 2020 ) which resulted in the approval of the development arrangements with Tydwell (my development company). I have therefore fulfilled the requirements of the joint venture and followed the pattern of approval we have done many times in the past. I trust that this deals with your points and I look forward to Otaki honouring the terms of the agreement signed with Tydwell. As you'll note Tydwell has now incurred significant expense for the benefit of Otaki which it will be invoicing shortly for prompt payment by Otaki.”
“In accordance with the contract between Otaki Holdings Ltd and Tydwell Ltd dated9 March 2020 and the subsequent email from Camran on11 June 2020 stating the ‘costs to Otaki will be£2,545,763 inclusive of VAT. The work is to be carried out by Tydwell Ltd in accordance with the JV agreement. The work on site is scheduled to start on Monday22nd June 2020 . Tydwell Ltd have received£750,000 on account of the work in accordance with the contract of the9th March 2020 . Tydwell Ltd will be issuing invoices throughout the project as staged payments as work is completed up to the£2,545,763 . You confirm that Otaki will settle these Tydwell Ltd invoices in accordance with the9th March 2020 contract.”
“As it stands I can tell you for sure that the cost of the job is a lot less than what is quoted by Tydwell. As you know the original quote was GBP750,000-00 and the new quote is over 2.5M so full details MUST be provided together with at least two more quotes for comparison. To be honest even if Tydwell was putting a margin on this job as long as this was agreed I would have no problem with that and I would have no problem even if the job was even going to cost 2.75M provided this was tendered out properly and all estimates were provided to us fully. I know Mace has given 2.75M for the job but as I have said before this was to wipe the collateral warranties to 2025 with Otaki so there is no future come back it was not just for doing the cladding. CM [i.e. Mr Mirza] is responsible to negotiate the best deal since he is running this business, but that does not mean he can divert all this money to his personal company and do the job and not provide any details, total conflict of interest and fraudulent in my opinion. …. Otaki can now only agree very reluctantly which is what you need to say to Camran (I need this window open so I can challenge Tydwell's estimate if I need to). CM needs to know that Otaki has to perform its duty and hence will need to get 2/3 estimates so it can compare Tydwell quote and make sure it is very competitive since Tydwell is refusing to provide full details at the last minute despite promise made Otaki who now has been put in a very difficult position especially due to the Insurance timeline which is number one priority. This needs to be made VERY CLEAR so I can deal with this later.”
“I did not believe that the work was actually costing as much as documents such as this made out, but as previously stated I did not have access to the documents that would prove it one way or the other”
“2. The determination as to what was a fair and reasonable level of charge for the services provided by Tydwell and Redwire was made: 2.1. on an ad hoc basis at the time that each particular invoice was raised by either Tydwell or Redwire; 2.2. by Mr John and Mr Mirza; 2.3. taking into account the value of services and/or goods supplied by third parties; 2.4. on the basis of, and commensurate with, the services provided by Tydwell or Redwire in respect of the matters set out in each invoice; and 2.5. using their experience in, and knowledge of (in Mr Mirza's case) property development and business, and (in Mr John's case) accountancy and business.”
“Carrying the risk of a claim by Otaki in relation to fire combustibility of the materials used in the construction works (i.e. self-insuring) after having been informed by its insurance broker that such a risk (i.e. relating to the fire combustibility of the materials) was effectively uninsurable;”
"... Tydwell Valuation Spreadsheet was created by Mr John. Mrs Mirza may have helped with the formatting or editing of the figures in the spreadsheet under Mr Mirza's guidance."
“… given my lack of business experience and lack of knowledge concerning the JV arrangement/relationship, notwithstanding that this was an unprecedented situation, I was in no place to question my Father or Mr John’s work and left it to them.”
“keep the Employer fully informed and provide the Employer with regular reports on all matters which would be of interest to a prudent employer together with such other information in regard to the Project as the Employer may require.”
“When parties stipulate in their contract the circumstances that must occur in order to impose a legal obligation on one party to pay, they necessarily exclude any obligation to pay in the absence of those circumstances; both any obligation to pay under the contract and any obligation to pay to avoid an enrichment they have received from the counterparty from being unjust. The “silence” of the contract as to what obligations arise on the happening of the particular event means that no obligations arise as Lord Hoffmann made clear in Belize cited earlier. This excludes not only an implied contractual term but a claim in unjust enrichment.”
“Where a benefit is mistakenly conferred by one party on another under a contract, a claim in unjust enrichment will commonly fail even if the mistake would otherwise support such a claim. As we explain in Ch.3, the contract will bar the claim, to the extent that it entitles the defendant to receive the relevant benefit. For the claim to succeed, the claimant will need to show that the contract is invalid, being either non-existent, void or voidable. This is not a matter for the law of unjust enrichment, but the law of contract.”
“In the light of Ivey[2018] AC 391 , it must in our view now be treated as settled law that the touchstone of accessory liability for breach of trust or fiduciary duty is indeed dishonesty, as Lord Nicholls so clearly explained in [Royal Brunei Airlines Sdn Bhd v Tan[1995] 2 AC 378 ], and that there is no room in the application of that test for the now discredited subjective second limb of the Ghosh test. That is not to say, of course, that the subjective knowledge and state of mind of the defendant are unimportant. On the contrary, the defendant’s actual state of knowledge and belief as to the relevant facts forms a crucial part of the first stage of the test of dishonesty set out in Tan. But once the relevant facts have been ascertained, including the defendant’s state of knowledge or belief as to the facts, the standard of appraisal which must then be applied to those facts is a purely objective one. The court has to ask itself what is essentially a jury question, namely whether the defendant’s conduct was honest or dishonest according to the standards of ordinary decent people.”
“84. The breaches of fiduciary duties by Mr Mirza and/or Tydwell set out in section IV(3)(ii) above were procured, induced or assisted by each other (by reason of Mr Mirza being the director, owner and controlling mind of Tydwell) and/or by Redwire and/or Boomzone and/or by Mr John and/or Mr Ameer Mirza and/or Mrs Mirza by reason of their positions within Tydwell and their involvement in the matters alleged as particularised above. 85. The Defendants thereby acted dishonestly in that their knowledge of the relevant matters was such as to render their conduct contrary to normally acceptable standards of honest conduct.”
“It is obviously not necessary that he should know the details of the trust or the identity of the beneficiary. … It may be sufficient that he knows that he is assisting in a dishonest scheme.”
“The essence of a liability to account on the footing of knowing receipt is that the defendant has accepted trust assets knowing that they were transferred to him in breach of trust and that he had no right to receive them. His possession is therefore at all times wrongful and adverse to the rights of both the true trustees and the beneficiaries. No trust has been reposed in him. He does not have the powers or duties of a trustee, for example with regard to investment or management. His sole obligation of any practical significance is to restore the assets immediately.”
“A conspiracy to injure by unlawful means is actionable where the claimant proves that he has suffered loss or damage as a result of unlawful action taken pursuant to a combination or agreement between the defendant and another person or persons to injure him by unlawful means, whether or not it is the predominant purpose of the defendant to do so.”
“12. Conspiracy to injure must be pleaded to a high standard, particularly where the allegations include dishonesty: i) Allegations of conspiracy to injure "must be clearly pleaded and clearly proved by convincing evidence". ii) The more serious the allegations made, the more important it is for the case to be set out clearly and with adequate particularity … an allegation of dishonesty must be pleaded clearly and with particularity. iii) Unlawful means conspiracy is a grave allegation, which ought not to be lightly made, and like fraud must be clearly pleaded and requires a high standard of proof. iv) Where a conspiracy claim alleges dishonesty, then "all the strictures that apply to pleading fraud" are directly engaged, i.e. it is necessary to plead all the specific facts and circumstances supporting the inference of dishonesty by the defendants.”
“In order to repopulate the serviced offices and datacentre, Boomzone will need to have a lease extension based [sic] and so Camran will forward one shortly for your approval and signature.”
“It is embarrassing for want of particularity. It is entirely unclear what is meant by “repeatedly”, to whom and when such representation was made and to whom the transfer of shares was to be made. … It is denied (if it is so alleged) that such a representation would be actionable, being a statement of future intention rather than a statement of fact.”
“… the last invoice from Tydwell to Viper in relation to the operational costs of the Data Centre [by which the Defence and Counterclaim is referring to the entirety of No, 22] is dated2 September 2019 .”
“In certain cases, notably where there is a fiduciary relation between the parties, there may be a duty to reveal information so that (for example) non-disclosure will make any resulting transaction voidable. It now seems accepted that in such cases non-disclosure may equally be capable of amounting to fraud at common law. Thus in Conlon v Simms [[2006] EWHC 401 (Ch) ; [2006] 2 All E.R. 1024], a solicitor who in partnership negotiations failed to mention a number of shady dealings in which he had previously been involved was held liable in deceit to his co-partner.”
“The a/g has my name but really it should be Trafalgar limited since the shares will be owned by Trafalgar.”
“As far as I know, after a protracted period of time, Mr Mirza transferred 50% of the Redwire shares to Mr Morjaria but did not transfer 50% of the Boomzone shares. Notwithstanding that the shares in Boomzone were never transferred (and that those in Redwire were only transferred at a later stage), as far I was concerned, 50% of the shares in Boomzone and Redwire were always held by Mr Mirza on trust for Mr Morjaria in light of the agreement referred to above. I therefore regarded Boomzone and Redwire as Joint Venture entities for all practical purposes.”
"In the current situation between me and Camran [Mr Mirza] where we want to bring all this to an end DO NOT let him ask you to change anything you guys do not agree with."
“WCL did not owe to Ross River a general obligation not to allow duty and interest to conflict nor a duty not to profit from the fiduciary relationship but did owe a duty not to do anything in relation to the handling of the joint venture revenues which favoured itself to the disadvantage of Ross River.”
“A fiduciary obligation towards [in the case before him], the Banaban community generally is one thing; the existence of a trust or fiduciary obligation in respect of specific land another.”
“… have a common origin in that equity is astute to prevent a trustee from abusing his position or profiting from his trust: the shepherd must not become a wolf.”
“As to the self-dealing rule, an express trustee acquiring trust property is not a constructive trustee at all but holds the property subject to a beneficiary’s right to seek rescission ex debito justitiae and to obtain an order for conditional resale”
“… if a trustee purchases the beneficial interest of any of his beneficiaries, the transaction is not voidable ex debito justitiae [ie under the self dealing rule], but can be set aside by the beneficiary unless the trustee can show that he has taken no advantage of his position and has made full disclosure to the beneficiary, and that the transaction is fair and honest.”
“It is, of course, well settled that the fair-dealing rule, with or without modifications, applies to many persons other than trustees, including agents, solicitors, company directors, partners and many others: see, for example, Snell's Principles of Equity, 27th ed. (1973), pp. 241-243. … The categories of fiduciary obligation are not closed …”
“The same principle also applies, but less stringently, in a case within the fair-dealing rule, such as the purchase by a trustee of a beneficiary's beneficial interest. There, there are genuinely two parties to the transaction and it will be allowed to stand if freely entered into and if the trustee took no advantage from his position or from any knowledge acquired from it.”
“The fair-dealing rule is engaged where a trustee purchases the beneficial interest of a beneficiary, or a fiduciary purchases property with respect to which he or she owes fiduciary obligations from the principal, or otherwise enters into a transaction with the principal which falls within the fiduciary relationship. In that case the beneficiary or principal can have the transaction set aside not as of right, but if the fiduciary (on whom the burden lies) fails to show that he or she took no advantage of his or her position, that full disclosure was made and the transaction was fair and honest.” (Emphasis added.)
“As it is merely an application of the general fiduciary conduct principle, the fair-dealing rule applies to any transaction between fiduciary and principal, even if property does not pass, where the transaction falls within the fiduciary relationship such that there is a conflict between duty and interest. The fair-dealing rule does not apply where the property involved in the transaction was not the subject of the fiduciary relationship, because there is no non-fiduciary duty in conflict with the fiduciary’s interest in the transaction.”
“The courts have not displayed any willingness to expand the rule described above into a general principle that a trustee must make a full disclosure and act fairly in all dealings with a beneficiary which have some connection with the trust.”
“The judge rightly held that the right to rescission on the grounds of abuse of confidence or breach of fiduciary duty depends on the exercise of discretion by the court to intervene in the enforcement of legal rights.”
“LMH would be used, as a new entity, because of the very large fit-out costs of the Office/Data Centre and the significant commercial risks involved. As my son, Ameer, sets out in his second witness statement, the TV production business was also very different to the serviced office business, and my children, the shareholders in LMH, knew a lot more about the media industry than I did, so it made sense to use a new entity specifically incorporated as a media company.”
“I/We agree in particular (but without limiting my/our agreement to be bound by the Services Agreement generally) to Clauses A(18) to A(20) of the Services Agreement and also that Clauses A(15) and A(27) of the Services Agreement shall apply to me/us as they do to the Client.”
“… to provide to the Bank, promptly upon request, any such information or documentation that the Bank deems necessary and appropriate, and to take such other reasonable actions upon the Bank’s request, to enable the Bank to satisfy its AML/CFT responsibilities and to comply with Applicable Laws and Regulations. In the event of any enquiry or request from regulatory, tax and other governmental authorities and agencies and/or competent law enforcement agencies, you agree to provide the Bank with all information and documentation that is necessary to satisfy the enquiry or request.”
“We understand that Pradeep’s and Sangita’s estimated overall wealth is in the region of£50m ”
“I see 50M [emojis] should[sic] have been£50K and not£50M [emojis] hmmmmm we will have to send back the same thing I suppose.”
“No I don’t have anything, this company goes back 20 years. I have never provided any information before and it has never been requested before so I don’t know where this has come from.”
“This company goes back 20 years and Pradeep is not aware of where the records are relating to it.”
“The previous documents they are requesting goes back over 20 years and I do not have anything to give them this has been pointed out to them before. In fact if I recall I could not even use the computer in those days and most things were manual so these records are gone years ago specially in Dubai when there was no filing of the accounts or any returns to be submitted. I have dealt with Mark Lewin for almost 20 years and he is aware of my History is all we can confirm but as for documents I do not have these going back all these years. Now that cladding issue is resolved and we have the planning for extension we are hopping (sic) to sell the Hotel and DC as soon as we can and BOS loan will be paid off. All these additional questions should have been covered before is all I can say, and as for the structure and beneficial owners it is quite straight forward now which IQEQ can confirm.”
“Thank you for the information that you provided on the call and the subsequent mail...This would allow us to complete our internal evaluation.”
“In the last two weeks I have had emails and long phone calls from BOS regarding my unfinished KYC. These questions could not be answered by Charles and with whatever Charles gave it still was not enough. Anyway with new information and additional details that I found I think finally they are happy and hopefully there won't be any more questions.”
“We'd need some supporting documents sir. ..None of these were part of the information provided at the time of account opening. We have run a similar exercise with Camran sir, and are on the verge of closing the matter. .request your help on this sir.”
“The problem we have is anything that is given to you, you come back with ten more questions and really it is not fair that after three years since we started this process you are still asking irrelevant questions and some of the questions go back 40 years, and this is two years after the drawdown was done. It is just NOT right and BOS management at the highest level should know… I hope this now should be it.”
“very disturbed to find out that the KYC matters which they had requested had still not been finalised as although they had completed their enquiries on me to the satisfaction of their compliance department they are still awaiting information from Pradeep. To quote Bikram, he said the matter is now ‘critical’”
“even if we get the financial information from Pradeep's accountant regarding Mercantile and I am able to now trace back the owning SPVs names via the land registry and connect them to Pradeep's 50% ownership; it remains your belief that BOS have simply taken the decision that they are no longer wanting to do this kind of business and as such you are going to introduce us to alternative funders in order to facilitate a smooth exit and that there is no question of calling in the loan and or tarnishing the reputation or credit worthiness of Camran, Pradeep or me and my co directors. You also mentioned that you were going through similar issues with other clients and this is all driven by increased regulatory requirements in Singapore.”
“On a stand alone basis it still doesn’t help much. I really wish you’d helped with the details earlier, maybe we wouldn’t have been in this situation.”
“1. Pradeep replaces BOS on same terms/costs to Viper. 2. Find an alternative financier in sufficient time to fund BOS 's replacement at the same cost to the company. 3. An alternative company to Viper, owned by Camran, without Pradeep buys Viper's interest in the property. a. BOS has confirmed that they are discussing with Credit about a similar facility for this new company b. This route will require bridging finance to exit the Viper relationship for approximately 1 week. c. BOS said that Pradeep will not be allowed to be connected with the property in the new venture 4. Do nothing, BOS demand the loan, the guarantees are called in and the Nat West relationship is potentially damaged. 5. The exit clauses in the JV are followed. a. This would be a sale in the open market and the current lowest point b. This would be in no-ones interest.”
“DETAILS FROM YOUR SIDE WERE PARTICULARLY SLOW TO COME BY AND AT TIMES ON CALLS YOU HAVE INDICATED THAT YOU WERENT ABLE TO PROVIDE ANY MORE.”
“…shocked and concerned that BOS appears to be progressing discussions, in collusion with Camran and Charles Homan, on such a structure and a credit approval process behind my back, where a refinancing plan is underway for the BOS facility with my exit from Viper in mind, without Camran, Charles or BOS having informed me previously of any such proposal. I object to this in the strongest terms. Camran does not have my consent to proceed with any such discussions with BOS. I see this as an unacceptable commercial interference by BOS in my private commercial affairs and interests and BOS certainly has no authority to further such a proposal.”
“the fixed and working capital requirements of the Company including working capital the Company requires from time to time to meet Expenditure but excluding any item included within the Initial Capital Requirement and subject to a maximum total amount of three hundred thousand pounds (£300,000 ).”
“The value of the Property to be realised by the Joint Venturers would be reduced if the lending from BOS was withdrawn leading to potential enforcement by BOS of its security (and, as has transpired, increased interest charges on the facility).”
“No, I think it is the KYC, and I think that's what the evidence shows, but of course that may well be an underlying problem … But ultimately it was KYC was the reason.”
“I really wish you’d helped with the details earlier, maybe we wouldn’t have been in this situation.”
“I believe if we were to reach an amicable solution with BOS, whereby Camran was to take over the BOS/NatWest facility on his own, this could potentially allow no further action being taken”
“The spirit and intention of the JVA required the parties to cooperate with a view in particular to Otaki’s acquisition of the Property and enhancement of its value (with a view to an eventual sale by the joint venture for profit). By contrast, none of the following was a Joint Venture Objective: (a) The sale of the shares of one of the JV Entities (Viper) which had a lease of part of the Property. (b) The purported assignment of choses in action belonging to Otaki. (c) The agreement by the Directors to assist the Morjarias in claims brought by them against Mr Mirza and others. (d) The Morjarias’ covenant not to sue the Directors for their historic conduct of the Joint Venture. 161.2 Further, the JVA did not provide for any mechanism whereby the shares in Viper or choses in action belonging to Otaki could be sold, let alone to any of the Joint Venturers. Absent agreement, the only means provided for under the JVA by which any of the shareholders in Otaki could exit from the joint venture was by termination under Clause 7, which envisaged either a sale of the Terminating Shareholder’s shares in Otaki or a sale of the Property. 161.3 In those circumstances, the standards of commercially acceptable conduct required the Morjarias and Otaki to inform Mr Mirza in advance (as the co-Joint Venturer) of any circumstances which would be tantamount to an exit or partial exit from the joint venture or which would otherwise materially affect the Joint Venture and/or the achievement of the Joint Venture Objectives. That included any proposal made by the Morjarias to do any of the following (and the key terms of any such proposal): (a) Purchase the shares in Viper; (b) Take an assignment of any choses in action belonging to Otaki; (c) Procure the Directors’ assistance in any claims brought by the Morjarias against Mr Mirza; or (d) Promise not to sue the Directors in relation to their historic conduct of the Joint Venture. 162. In the premises, Mr Morjaria and/or Mrs Morjaria and/or Otaki acted in breach of Clause 12 of the JVA by engaging in improper, commercially unacceptable or unconscionable conduct and/or by acting contrary to the spirit and intention of the joint venture.”
“3. Once the HoTs are signed, we will be contacting BoS together and if your clients then pull out due to an offer from WCT/the Morjarias, the property will go into receivership. That is inevitable. 4. It is unclear how your clients would clear KYC/AML with any funds from WCT/Morjarias given the monies have to go to BoS which has rejected WCT/the Morjarias based on them failing KYC requirements.”
“… The principle flowing from Said v Butt is well-established and not in issue. Moreover, the test as to whether a director is acting in bad faith and/or without authority so as to become potentially liable for inducing a breach of contract by the company in question is also now clear. It is apparent that both Waller J [in Ridgeway Maritime Inc v Beulah Wings Ltd (The Leon) [1991] 2 Lloyd’s Rep. 611] and Lane J [in Antuzis v DJ Houghton Catching Services Ltd[2019] EWHC 843 (QB) (“Antuzis”)] took the view that the matter has to be approached by reference to the director’s duties to the company with the test of bad faith being whether the director was acting in breach of his duties to the company (as opposed to any question of bad faith towards the other party to the relevant contract). This approach is also reflective of that taken by Gloster J in Crystalens[2006] EWHC 3357 (Comm) .”
“… the matter has to be approached on the basis that the question of whether a director acted bona fide and within the scope of his or her authority will be very dependent on the circumstances of the particular case. Regard is to be had to the director’s duties to the company. The director will not have been acting bona fide if he or she was in breach of the duties set out in section 172. However, the question must be considered in the round remembering that liability is to be seen as an exception to the general rule that a director will not be liable in tort for inducing the company of which he or she is a director to breach a contract. It follows that not every instance of causing a company to breach a contract or a legal obligation will involve a director in a breach of the section 172 duties nor will every such instance cause him or her to be characterised as acting in bad faith for the purposes of the rule in Said v Butt. The key will be whether the director was properly acting to promote the success of the company taking account of the matters to which he or she is required by section 172 to have regard. In that exercise it will be necessary to consider the circumstances as a whole. Those will include the motivation of the director and the nature of the duties said to be broken but in addition the nature of the obligations being broken by the company and the consequences of the company’s breach can be relevant to the question of whether the director can properly have been said to have been acting in the interests of the company.”
“A director, in exercising the director’s powers and discharging the director’s duties, shall – (a) act honestly and in good faith with a view to the best interests of the company; and (b) exercise the care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances.”
“.. a director owes a duty to exercise his powers as such honestly in what he believes to be the best interests of the company (for convenience, "the duty of good faith"). This is a principle of fidelity, and the test is applied subjectively. In other words, the question is whether the director did, at the time he performed the impugned act, honestly believe that he was doing what he did in the interests of the company as a whole. This duty derives both from Article 74(1)(a) of the Companies Law and from the general law.”
“To be liable for inducing breach of contract, you must know that you are inducing a breach of contract. It is not enough that you know that you are procuring an act which, as a matter of law or construction of the contract, is a breach. You must actually realize that it will have this effect. Nor does it matter that you ought reasonably to have done so.”
“An honest belief by the defendant that the outcome sought by him will not involve a breach of contract is inconsistent with him intending to induce a breach of contract. He is not to be held responsible for the third party’s breach of contract in such a case. It matters not that his belief is mistaken in law. Nor does it matter that his belief is muddle-headed and illogical …”
“I note that these authorities generally focus on the defendant having an “ equal or superior right ”
“1.ALL PROFFESSIONAL PARTIES IE. ARCHITECT, DESIGNERS, CONSULTANTS, PROFFESIONAL PROJECT MANAGEMENT COMPANIES ETC ETC SHOULD BE PROPERLY APPOINTED WITH FULL ACCOUNTABILITY AND WHAT EXACTLY WILL BE THEIR ROLE 2. NOTHING SHOULD BE PAID WITHOUT PROPER BACK UP INVOICES. 3.FULL MONTHLY REPORTS SHOULD BE SUBMITTED FOR THE WORK IN PROGRESS TOGETHER WITH FULL FINANCILAS ON REGULAR INTERVALS 4 THERE SHOULD BE NO CHARGES FROM TYDWELL SINCE 10% EXTRA PROFIT IN THE JV AGREEMENT COVERS THE TIME TYDWELL PUTS IN THIS PROJECT WHICH WOULD AMOUNT TO LOT MORE THEN MONTHLY MANAGEMENT CHARGES. THIS IS WHAT WAS REQUESTED BY CAMRAN AND THST IS WHY JV AGREEMENT SAYS 55% PROFIT TO CA & 45% PROFIT TP PM. NO OTHER CHARGES APPLY.”
“The Note was initially provided to Jones Day in PDF form by Mr Morjaria at the outset of Jones Day's engagement (in or around August 2020), at which time the Jones Day team understood (based on the title and content of the document) that it was a contemporaneous note of a call Mr Morjaria had with Richard Spencer-Breeze in January 2008. The Note was referred to, described as contemporaneous in, and enclosed with, the letter before action sent to Mr Mirza on23 April 2021 . Although Mr Morjaria reviewed the letter before action before it was dispatched, he did not note that the Note had been erroneously described as contemporaneous. Jones Day subsequently became aware that the Note was not a contemporaneous document during the course of discussions with Mr Morjaria beginning in the last week of May 2021.”
“...I have been between a rock and a hard place and so had to wait for the right time to strike, which can only be when the Hotel &Offices/DC are sold. I feel there is enough BAD FAITH and Fraud here and so many schemes to defraud hence we need serious fire power and threat of maximum JAIL term to bring him to his knees and make him want to settle and close the chapter. However, ideally, I want to get the money first and hopefully time inside for him as well is what is needed here...”; ii) on15 April 2021 Mr Morjaria wrote to EMM stating: “Surely there is a threat of jail sentence even if we have to take out a private prosecution and that is what we are determined to do should be the message if our allegations are proved correct. This will wake him up to settle with us.”; iii) on10 May 2021 Mr Morjaria wrote to Jones Day regarding a letter from CMS saying: “...this meaningless back and forth is wasting time and money. The threat of Jail time directly or indirectly need to be hinted to CMS that is the only way to wake up Camran.”; iv) on14 October 2021 Mr Morjaria wrote to EMM saying: “If you guys put the opposition lawyers against the rock and the hard place then what can they do? They will have to ask Camran to settle on which we will play hard initially”; v) on3 November 2021 Mr Morjaria’s son Shamick wrote to EMM saying: “We think strategically it is important to mention CM's wife Saira somewhere, whichever way possible, as the more of his family we can attach to this case the stronger our position becomes and the quicker they will come to the table to settle. Ultimately we -want him inside but -we also want to recover the money too.”; vi) on4 July 2022 Mr Morjaria wrote to Jones Day: “The only time the mediation will have any meaning is when the Criminal is filed and CMS makes it clear to CM that Jail time is possible, something I told you & James in my first meeting and I have repeated this fact a hundred times subsequently.”; vii) a note made by EMM of a call between EMM and Mr Morjaria on7 July 2022 discusses a question by Mr Morjaria as to whether once the case is filed it could be withdrawn before the first hearing; viii) on13 July 2022 Mr Morjaria wrote to EMM stating his requirement to file the case before the end of the month so that a without prejudice meeting could then be arranged; ix) on the same date, Mr Morjaria wrote to Jones Day stating: “If Kate [a lawyer at EMM] files before the month end CM will then agree to whatever we ask.”; x) on25 July 2022 EMM wrote to Mr Morjaria warning that: “• …if the criminal court considers that a primary motivation of a criminal prosecution is to put pressure on the defendant and to obtain a settlement, then it will take a dim view of that indeed • We have discussed that the Court will assess whether your primary motivation is to exert pressure, or money or justice. • You have made it clear to me many times that justice is the number 1 priority for you.” and Mr Morjaria responded that: “...I know Justice is number one priority BUT the cost is mounting up at an astronomical rate so the question is how do I see this through.. .. I have to think if there is a possibility of getting what we want from Camran since this could go on for a very long time... ...Bottom line is how am I going to recover the money because once he is inside things will slow down completely hence my thought on finding a way to recover as much as I can with the threat of the Criminal before it is too late to pull out. Although I do see that he will use the threat as a tool I am using to force a settlement, a difficult situation I suppose...”
“conclusion that PM’s primary motivation in issuing criminal proceedings was to use those proceedings as a threat in order to force CM to settle the claim cannot be open to sensible criticism.”
“The combination of requirements that the claimant must prove not only the absence of reasonable and probable cause, but also that the defendant did not have a bona fide reason to bring the proceedings, means that the claimant has a heavy burden to discharge.”
“On the basis of the material contained in the application for the summonses as supplemented by the totality of the material now before me, I remain of the view, expressed in my written reasons for issuing the summonses dated23 August 2022 , that here the ingredients of each offence are demonstrated.”
“…we all know that malice or improper motive is never a ground for saying there is no reasonable or proper cause. In the words of Lord Mansfield: " From the most express malice, the want of probable "cause cannot be implied ": see Johnstone v. Sutton [[1942] A.C. 206; 58 T.L.E].”
“Since the case of Sutton v. Johnstone [((1785) 1 Term Rep. 493], and no doubt earlier, it has been a rule rigidly observed in theory if not in practice that, though from want of probable cause malice may be and often is inferred, even from the most express malice, want of probable cause, of which honest belief is an ingredient, is not to inferred.”
“As Lord Denman C.J. said in the very similar case of Turner v. Ambler [10 Q.B. 252, 261.] " The unfair use made of the charge may prove malice, as the jury held that it did, but does not raise any inference of a belief that there was no reasonable or probable cause; for the contrary belief is perfectly consistent with malice”.”
“strategically important to mention CM’s wife Saira somewhere, whichever way possible, as the more of his family we can attach to this case the stronger our position becomes and the quicker they will come to the table to settle”
“It has been recognised for over 150 years, however, that in some circumstances abuse of process is actionable as a tort at common law. The existence of such a cause of action can be traced back to Grainger v Hill (1838) 4 Bing NC 212…”
“for abusing the process of the law, by applying it to extort property from the plaintiff, and not an action for malicious arrest or malicious prosecution...his complaint being that the process of law has been abused, to effect an object not within the scope of the process, it is immaterial whether the suit which that process commenced has been determined or not, or whether or not it was founded on reasonable and probable cause.”
“The judges, led by Tindal CJ, held that the tort committed by the Ds was not malicious prosecution but abuse of the process of the law to effect an object not within the scope of the process which they had initiated, namely to “extort” the register, to which they had no right, from C or to obtain it from him by “duress”.”
“…the claimant must be able to establish that the defendant’s predominant purpose in bringing the proceedings is not to obtain the remedy that the law offers (disregarding for this purpose the use he may seek to make of that remedy once he has obtained it) but to achieve some other object that lies outside the range of remedies that the law grants.”
“In my judgment, one can certainly go so far as to say that when a litigant sues to redress a grievance no object which he may seek to obtain can be condemned as a collateral advantage if it is reasonably related to the provision of some form of redress for that grievance.”
“The essence of the tort is the abuse of civil proceedings for a predominant purpose other than that for which they were designed. This means for the purpose of obtaining some wholly extraneous benefit other than the relief sought and not reasonably flowing from or connected with the relief sought.” (Emphasis added).
“Instigating legal proceedings in good faith and with reasonable cause, even if they fail and even if they do damage in the Savile v Roberts sense, is not wrongful. Even maliciously instigating legal proceedings is not always, or even often, wrongful.”
“For now, it seems appropriate to continue to treat abuse of process as a separate tort, distinct from the malicious instigation of civil proceedings, but with the caveat that the courts may in the future decide to merge the two causes of action into a single composite one encompassing all malicious or abusive civil claims” (Emphasis added).
“a litigant pursuing an ulterior purpose unrelated to the subject matter of the litigation and that, but for his ulterior purpose, he would not have commenced proceedings at all, that is an abuse of process.”
“manifestly cannot embrace every advantage sought or obtained by a litigant which it is beyond the court's power to grant him. Actions are settled quite properly every day on terms which a court could not itself impose upon an unwilling defendant. An apology in libel, an agreement to adhere to a contract of which the court could not order specific performance, an agreement after obstruction of an existing right of way to grant an alternative right of way over the defendant’s land - these are a few obvious examples of such proper settlements.”
“Men go to law to redress a grievance. They may not know or understand the limits of the remedies provided by law …But, equally, a man, while pursuing the remedies offered by law, may negotiate to secure, by arrangement with the parties sued, terms more favourable than, or different from, what he would get in the absence of agreement.”
“whether the defendant’s predominant purpose in bringing the proceedings is not to obtain the remedy that the law offers in those proceedings, but to achieve some other object that lies outside the range of remedies in those proceedings.” (Emphasis added.)
“the deputy judge was fully entitled to conclude that the interest of the defendants in relation to their property relocation was insufficiently collateral to the judicial review proceedings as to render those proceedings abusive.”
“a man, while pursuing the remedies offered by law, may negotiate to secure, by arrangement with the parties sued, terms more favourable than, or different from, what he would get in the absence of agreement.”
“to achieve something not available in the course of (or, I would say, by means of) properly conducted proceedings.”
“an abuse of process occurs when the only substantial intention of a plaintiff is to obtain an advantage or other benefit, to impose a burden or to create a situation that is not reasonably related to a verdict that might be returned or an order that might be made in the proceeding.”
“It is not suggested that this Board either can or should abolish the torts of malicious prosecution and abuse of process. We are faced with the task of discerning some rational principles which will enable us to define their boundaries. In an ideal world the separate torts of malicious prosecution and abuse of process might be brought together in a single coherent tort of misusing legal proceedings. This looks like a task much better suited to the Law Commission than to this Board. This Board can research the existing state of the law in this country (which will apply in the Cayman Islands unless there is some local legislation to the contrary). It can research the law in some comparable common law jurisdictions, but by no means all. But it does not have the resources to research and develop the policy arguments, conduct empirical research and consult the legal and general public on possible ways forward.”
“This … is a case which is particularly well suited for judicial development: it is about the use and misuse of judicial proceedings; the law is entirely judge-made; and some would say that it is in a judge-made mess. If so, the judges should do what they can to sort it out. It is unfair to expect Parliament to do so.”
“BoS take steps to obtain a robust independent market valuation of Viper Limited's interest in the Property in its current state and condition. The valuation exercise would be undertaken by a reputable firm, with appropriate professional indemnity insurance. The valuation would be addressed to BoS, so that BoS can rely on it, but with Mr Mirza in the loop on this so that informed decisions can be made. The independent valuation of the Property would be used to set the sale price for the Property in the sale transaction referred to below. The independent valuation exercise would not be public - it would be confidential to BoS and Mr Mirza. If necessary, the valuation could be disclosed to Viper Limited after the sale of the Property referred to below.”
“As at the date of his purported exercise of the power of sale under the BOS Charge: a. Mr Mirza was not the registered proprietor of the BOS Charge on the title to the Viper Lease. b. BOS had not assigned to him any rights to the debt under the BOS Facility. c. Mr Mirza had repaid the Facility and, as far as the Morjarias are aware, no sums remain owing under the BOS Facility (alternatively any sums that remain owing thereunder are not sums owed to Mr Mirza). d. Thus there were no Secured Liabilities within the meaning of the BOS Charge (alternatively, Mr Mirza could not receive and/or could not give a discharge for all of the sums within the Secured Liabilities (if any)). (2) No power of sale 119G. In consequence of the matters set out above, Mr Mirza had no right to exercise the power of sale, because he was not a person so entitled as legal owner of the BOS Charge and/or falling withins106(1) of the Law of Property Act 1925 , further or alternatively the BOS Charge should have been discharged by him and in those circumstances the power of sale was not exercisable. Nor, if it be alleged, was Mr Mirza subrogated to the rights of BOS, including because (without prejudice to the right to plead more fully by way of Reply) he contracted for different security, namely assignment of the BOS Charge, and/or because in all the circumstances set out herein he does not come to the Court with clean hands. 119H. The purported transfer to Wolverine is accordingly void, and Wolverine holds title to the Viper Lease on bare resulting trust for Viper.”
“For the avoidance of any doubt, the payment by Mirza under Clause 1.1 of this Settlement Agreement is made pursuant to Mirza ’ s capacity, obligations and/or liability as a Guarantor, to discharge the accrued debt that is due and owing by Viper to the Bank as at the date of this Settlement Agreement. Mirza does not purport to purchase, and the Bank does not purport to sell, any debt owed by Viper to the Bank and/or any of the Viper Security Documents. Nothing in this Settlement Agreement is intended to diminish or negate any right that Mirza may have, if at all and howsoever arising, as a result of his payment as a Guarantor pursuant to Clause 1.1 above.”
“subrogation as an equitable remedy to reverse or prevent unjust enrichment which is not based upon any agreement or common intention of the party enriched and the party deprived.”
“When judges say that the charge is "kept alive" for the benefit of the plaintiff, what they mean is that his legal relations with a defendant who would otherwise be unjustly enriched are regulated as if the benefit of the charge had been assigned to him. It does not by any means follow that the plaintiff must for all purposes be treated as an actual assignee of the benefit of the charge and, in particular, that he would be so treated in relation to someone who would not be unjustly enriched.”
“…normal equitable principles apply to subrogated rights. Thus, the familiar equitable defences can be raised against a claim for subrogation, and priority as between the person with the subrogated right and other parties are to be determined in accordance with normal equitable principles: see Halifax -v- Omar, at paragraphs 81-83 per Jonathan Parker LJ.”
“For the defence of unclean hands to operate at all, the impropriety complained of “must have an immediate and necessary relation to the equity sued for”
“It is quite clear that a mortgagee exercising his power of sale cannot purchase the property on his own account, and I think it clear also that the solicitor or agent of such mortgagee acting for him in the matter of the sale cannot do so either.”
“A mortgagee cannot sell to himself, nor can two mortgagees sell to one of themselves, nor to one of themselves and another. The reasons for this are obvious, and are not merely formal but substantial. A man cannot contract with himself, and in the cases supposed there cannot be any independent bargaining as between opposite parties. For similar reasons a mortgagee cannot sell to a trustee for himself; he cannot buy in the name of another. But when mortgagees sell to a corporation, there are, prima facie, two independent contracting parties and a valid contract, and if the bargaining is real and honest, and conducted independently by the mortgagees on the one hand, and by the directors or officers of the corporation on the other, and it is satisfactorily shewn that in concluding the terms of the sale the parties were in no way affected by the circumstance that one of the mortgagees had some interest as a shareholder in the corporation, I see no sufficient reason that the sale ought not to stand.”
"A sale by a person to himself is no sale at all."
“I conclude that there is a limited principle of English law which applies when a person is under an existing legal obligation or liability or subject to an existing legal restriction which he deliberately evades or whose enforcement he deliberately frustrates by interposing a company under his control. The court may then pierce the corporate veil for the purpose, and only for the purpose, of depriving the company or its controller of the advantage that they would otherwise have obtained by the company’s separate legal personality.”
“A mortgagee and a receiver both owe a duty in exercising their powers to do so in good faith for the purpose of preserving, exploiting and realising the assets comprised in the security and obtaining repayment of the sum secured. A want of good faith or the exercise of powers for an improper purpose will suffice to establish a breach of duty.”
“It is proper for the mortgagee to exercise his powers in order to protect his security, and the exercise of the power is not bad because it is motivated by several purposes, as long as one of the purposes is a proper one, for example to recover the secured debt or to protect the security.” (Emphasis added).
“Further, having procured the creation and grant of the Boomzone Leases out of the Viper Lease in breach of fiduciary duty, Mr Mirza used the existence of the Third Boomzone Lease to procure the transfer to Wolverine of the Viper Lease at a reduced value … He thereby engineered a situation in which companies closely related to him (Wolverine, Boomzone and LMH) came to own the entire chain of leases between the freehold and the profitable lease to Timeline (the Viper Lease, the Third Boomzone Lease and the LMH Lease) for a total price which was a fraction of the market value of those interests combined, making a profit for those companies (or some of them) and causing loss to the Claimants. That situation was a continuation of, alternatively a consequence of, Mr Mirza’s breach of fiduciary duty complained of above.”
“Conspiracy being a tort of primary liability, the question what constitute unlawful means cannot depend on whether their use would give rise to a different cause of action independent of conspiracy. The real test is whether there is a just cause or excuse for combining to use unlawful means.”
"the court will not enter default judgment against that defendant"; but on the other hand, at (ii) it goes on to say: "the court must deal with the application at the same time as it deals with the claim against the other defendants"
“21.— Time limit for actions in respect of trust property. (1) No period of limitation prescribed by this Act shall apply to an action by a beneficiary under a trust, being an action— (a) in respect of any fraud or fraudulent breach of trust to which the trustee was a party or privy; or (b) to recover from the trustee trust property or the proceeds of trust property in the possession of the trustee, or previously received by the trustee and converted to his use.”
“In my opinion, it is clear that s 21(1)(a) of the Act of 1980 is concerned only with actions against trustees on account of their own fraud or fraudulent breach of trust.”
“The Paragon case and Williams v Central Bank of Nigeria (and the authorities on which they are based) are concerned with identifying the class of fiduciaries who fall within the definition of “trustee” in section 38(1). This, as I mentioned earlier, is a question of status which is determined by the nature of the office which they lawfully hold and the power over the trust property which that gives them.”
“32.— Postponement of limitation period in case of fraud, concealment or mistake. (1) … where in the case of any action for which a period of limitation is prescribed by this Act, either— (a) the action is based upon the fraud of the defendant; or (b) any fact relevant to the plaintiff's right of action has been deliberately concealed from him by the defendant; or (c) the action is for relief from the consequences of a mistake; the period of limitation shall not begin to run until the plaintiff has discovered the fraud, concealment or mistake (as the case may be) or could with reasonable diligence have discovered it. References in this subsection to the defendant include references to the defendant's agent and to any person through whom the defendant claims and his agent. (2) For the purposes of subsection (1) above, deliberate commission of a breach of duty in circumstances in which it is unlikely to be discovered for some time amounts to deliberate concealment of the facts involved in that breach of duty.”
“For the purposes of section 32(1)(a), an action is only ‘based upon a fraud’ if fraud is an essential element of the cause of action (see McGee, Limitation Periods (8th ed.) at [20-009]; Phillips-Higgins v Harper[1954] 1 KB 550 ). This includes a claim for fraudulent misrepresentation (Regent Leisuretime v Natwest Bank[2003] EWCA Civ 391 ), but not ‘moral turpitude’ falling short of fraud (Chagos Islanders v AG[2004] EWCA Civ 997 ). For these purposes, that which must have been discovered or discoverable by the claimant before the limitation period will begin to run is knowledge of the essential facts constituting the alleged fraud.”