Sunil Gupta & Anor v Olgun Halil Shah & Ors [2026] EWHC 2064 (Ch)

[2026] EWHC 2064 (Ch)Case No BL-2021-000873IN THE HIGH COURT OF JUSTICEBUSINESS & PROPERTY COURTS OF ENGLAND AND WALESBUSINESS LIST (ChD)Venue The Rolls Building, 7 Rolls Buildings, Fetter LaneLondonEC4A 1NLDate 17 June 2026
Before
MASTER BRIGHTWELL
Between
(1) SUNIL GUPTAClaimants(2) SUNIL GUPTA MD LLCClaimant(1) OLGUN HALIL SHAHDefendants(2) LEX FOUNDATION LIMITEDDefendant(3) NUREL HALIL SHAHDefendant(4) KADIR HALIL SHAHDefendant(5) KEREM HALIL SHAHDefendant(6) MELTEM HALIL SHAHDefendant
MR MARC GLOVER (instructed by Spencer West LLP) for ClaimantsMS KENDYA GOODMAN (instructed by Croft Solicitors) for Fourth and Sixth Defendants
APPROVED JUDGMENTDigital Transcription by Marten Walsh Cherer Ltd.2nd Floor, Quality House, 6-9 Quality Court, Chancery Lane, London WC2A 1HP.Telephone No: 020 7067 2900. DX 410 LDEEmail: info@martenwalshcherer.comWeb: www.martenwalshcherer.com

MASTER BRIGHTWELL:

[1]By an application notice dated 6 November 2025 the fourth and sixth defendants to this claim seek an order that, unless the claimants do pay to the fourth and sixth defendants’ solicitors by a date to be fixed the sums of £130,000 plus interest at the judgment rate and £20,000 together with accrued interest, then the claimants shall be debarred from further participation in the proceedings until payment is made by them or further order, together with orders for costs.[2]The background to these long-running proceedings is well known to the parties and I will not set it out in detail here. I have been taken to the various judgments which have been given and which are relied on by the parties both in support of and in opposition to the application.[3]In short summary, judgment was entered against the first and third defendants for significant sums in 2023 by orders made by Sir Anthony Mann on 31 March 2023, and by a further order made by Mr Nicholas Thompsell sitting then as a Deputy Judge of the High Court on 15 July 2024.[4]The claim relates to sums which were wrongly appropriated by the first defendant, who I am told by the fourth and sixth defendants is no longer alive but who was the father of the fourth and sixth defendants. £100,000 of the sums received by the first defendant, were paid over to the fourth, fifth and sixth defendants. Those sums have now been repaid and the claims against the fourth and the sixth defendants, with whom I am concerned today, have come to an end.[5]This happened by virtue of an application heard by Mr Andrew Twigger KC sitting as a Deputy Judge. By an order dated 17 October 2025 he granted reverse summary judgment to the fourth and sixth defendants in relation to the continuing claims against them and ordered that the claim against them was therefore to be dismissed without disturbing any of the orders which had previously been made. He also ordered that the claimants should pay the fourth and sixth defendants their costs of the reverse summary judgment application on an indemnity basis subject to detailed assessment if not agreed.[6]He directed that the claimants should, by 4pm on 1 November 2025, pay £75,000 in relation to the costs of the reverse summary judgment application and £55,000 in relation to the costs of the continuing claims; thus one gets the figure of £130,000 which forms the subject matter of the application.[7]The £20,000 in issue is a sum which had been received by the fourth and sixth defendants and then paid into court by them, but to which the claimants were not entitled. As a result of a mistake on the part of either the court or the Court Funds Office, that £20,000 was incorrectly paid out to the claimants’ solicitors in 2023 (there being no order for it to be paid out) and then paid on by them to their clients, the claimants.[8]There is a separate application before the court which I have not heard and which there will not be time to deal with today by which the fourth and sixth defendants seek an order that the claimants’ solicitors personally do repay, or repay to the Court Funds Office, that sum of £20,000.[9]There are also costs orders the other way, a matter which was not apparent from the documents filed in support of the application, nor was it raised earlier by the claimants’ solicitors and emerged for the first time, certainly as far as the court is concerned, when Mr Glover’s skeleton argument was filed on behalf of the claimants yesterday afternoon.[10]Sir Anthony Mann in his order of 31 March 2023 made an order that the fourth, fifth and sixth defendants were to pay 10 per cent of the costs of a summary judgment application on the standard basis. Then, in relation to the costs claimed of the action to date, the order was that the fourth, fifth and sixth defendants were to pay 5 per cent of the claimants’ costs up to that date, those costs being subject to assessment and there not being any order for payment on account.[11]There is also an order made by Thompsell J, as he had then become, on 19 December 2024 when he gave effect to an earlier order that the fourth, fifth and sixth defendants were to pay 60 per cent of the claimants’ summarily assessed costs of what was described as a debarring application and in that order he summarily assessed those costs at £77,812.50 for the costs of the first hearing and £26,390 for the costs of the second hearing. The requirement on the part of the fourth and sixth defendants, together with the fifth defendant, is to pay 60 per cent of that sum. Ms Goodman appearing on behalf of the applicants today accepted that some sums were owing by her clients to the claimants although she, on instructions, disputed the proposition that the amount owing would be as much as £100,000.[12]As I have said, the proceedings have come to an end as against the fourth and sixth defendants, and the substantive proceedings have also come to an end against the other defendants. The claimants are not presently satisfied that the first defendant is in fact deceased and there may be further steps to take in relation to him or in relation to his estate. There are attempts to enforce against the third defendant, and an application has been filed that the third defendant, the applicant’s mother, submit to an examination under CPR Part 71. That application, in light of the present one, has not yet been listed; that is a matter I will consider with the parties at the end of this judgment. The other step to be taken is the detailed assessment of the sums payable pursuant to all of the costs orders made during the course of the proceedings, which will include Mr Twigger KC’s order of last year but also the orders of Sir Anthony Mann and all of the other costs of the proceedings which have not been subject to a summary assessment.[13]The principles applicable to an application for an unless order, that is an order debarring a party from participating in proceedings, or at least taking certain steps in proceedings, whilst there are extant unpaid costs orders which they are required to meet, are well established. They are most frequently set out by reference to the decision of Sir Richard Field in Michael Wilson & PartnersLtd v Sinclair [2017] EWHC 2424 (Comm) at paragraph 29. There are six paragraphs. I am not going to read them out because they are well known and, unusually in this case, there is an acceptance on the part of the claimants that an order would be appropriate if the proceedings were ongoing and if there were no costs orders the other way, so this is not the usual case where the court has to consider whether the imposition of an unless order would probably stifle the pursuit or the defence of the claim. The application is resisted on other grounds.[14]I would, however, stress point 1 of Sir Richard Field’s criteria, which is that the imposition of a sanction for non-payment of a costs order involves the exercise of a discretion pursuant to the court’s inherent jurisdiction. It is apparent from his decision, but also from other authorities considering the application of these principles, that the court does indeed have a discretion to be exercised, albeit that in normal circumstances, and all other things being equal, the court will usually make an order where there are ongoing proceedings unless the respondent has satisfied the court that they are unable to meet the order whether from their own funds or through obtaining funds elsewhere. On the other hand, the court will usually decline to make an order where the making of the order would probably stifle the prosecution or the defence of the claim.[15]As I have indicated, Mr Glover resists the application on behalf of the claimants on two principal bases. First, he relies on the costs orders going the other way which may be able to be set off against the costs orders in favour of the fourth and sixth defendants. He submits that such a set off would usually be imposed at the point of a detailed assessment, where in the normal course these matters would be resolved. He also submits that the authorities do not support the existence of a jurisdiction to make unless orders in favour of a party where the claims against that party have finally concluded, and that it would be wrong in principle to make such an order. He characterises the nature of the jurisdiction of the court as one of ‘pay to play’; in other words, the party needs to comply with interim costs orders which have been made in order to pursue or defend the claim through to its conclusion and that a claimant should not prevented from enforcing a final judgment because of unsatisfied costs orders, especially where those orders are in favour of defendants other than those against whom the claimant wishes to enforce.[16]I will consider first the point that the proceedings have concluded. Ms Goodman indicated frankly that the purpose of the application was not to prevent the claimants from pursuing proceedings against her client. She indicated that it was (and her word was ‘leverage’) in order to procure the enforcement of the order for a payment on account of costs in favour of her clients. I note in that context that, whilst the solicitors for the fourth and sixth defendants have indicated that they intend to pursue enforcement proceedings against the claimants in relation to the payment on account that was ordered, they have not yet done so. I do also note, of course, that the claimants are not in this jurisdiction nor is it to be expected there is any property against which enforcement may be made here.[17]Ms Goodman relied principally on the decision of Zacaroli J in Tonstate GroupLimitedvWojakovski [2020] EWHC 1004 (Ch). This was a case in which there were three related sets of proceedings being case managed and proceeding together. They are described in paragraph 1 of the judgment as, first, a derivative action in which a company and other companies in its group sought the return of money wrongfully extracted from them by Mr Wojakovski; secondly, a claim in which two individuals, Mr and Mrs Matyas, sought the rescission of the transfer of shares made by them to Mr Wojakovski; and, thirdly, an unfair prejudice petition in which he sought various orders against Mr and Mrs Matyas and other entities in the group.[18]The costs orders with which the application before the judge were concerned are set out at paragraph 7. Mr Wojakovski had been ordered to pay costs both to one of the companies, and also to Mr Matyas, and he had also been ordered to provide security for costs and had failed to do so.[19]The points of principle on which both sides’ counsel addressed me, are discussed from paragraph 38 onwards. Paragraphs 38 and 39 say this:
“38. The claimants seek an order that Mr Wojakovski be debarred from defending and/or prosecuting all of the three related actions. Mr Haque QC contends that Mr Wojakovski cannot be debarred from defending the Shares Claim because the costs order was made in the other actions and there is no power to debar a party from defending one action by reason of non-payment of a costs award in another action.” “39. Neither party was able to locate any authority on this point but as a matter of principle it seems to me that Mr Haque’s general proposition is correct. Mr Fulton did not seek to persuade me otherwise, but contended, first, that the costs order was made in respect of all three actions and, second, that in any event the three actions are so closely related that it is artificial to treat them as separate actions.”
[20]What Zacaroli J seems to have indicated there, and Ms Goodman appeared to accept, is that the court does not have jurisdiction to make an unless order in one action which would have the effect of preventing a party from prosecuting an entirely separate action. Her submission was that as all of the claims against the various defendants in the present claim are being pursued within the same set of proceedings the court has power to make an unless order to prevent the claimants from pursuing any of the claims against any of the defendants or to enforce any of the judgments against any of the defendants within the same set of proceedings.[21]The order that Zacaroli J went on to make, explaining his reasoning from paragraphs 40 to 46, is that it would not be proportionate to debar Mr Wojakovski from defending the shares claim but that it would be appropriate to debar him from participating in the two other claims.[22]A point I specifically raised was whether it could be seen from the analysis in this case that the judge was debarring Mr Wojakovski from prosecuting or defending claims that were wholly unconnected to those in relation to which costs orders had been made. It does not seem to me, from having considered the judgment more carefully when I considered my decision, that this is what he in fact did.[23]What I take from Zacaroli J’s judgment is that where the court has before it more than one set of proceedings involving the same parties, the court has a discretion to make an unless order debarring a party from continuing to participate in more than one set of proceedings even if the costs order which remains unpaid was made in only one and that, when considering whether or not to do that, the court will consider the degree of connection between the parties and the proceedings, and of course consider all the circumstances as it always does when considering whether to exercise its discretion. The court, so it would appear to me from this judgment, has a jurisdiction to make such an order in circumstances where all of the claims are before it at the same time.[24]I do not consider Tonstate to be authority for the proposition that where one party is in default as against another party, the party in default may be debarred as against all other parties in relation to different causes of action and it seems to me material that the claims which are brought within these proceedings against the different defendants involve the same underlying background matrix of fact but clearly different causes of action. That is evident not least from the basis upon which Mr Twigger KC dismissed the claim against the fourth to sixth defendants, the allegations against or in respect of which related to their receipt of money from one or both of their parents but not to the way in which moneys were taken directly from the claimants and thus misappropriated. Furthermore, I do not consider the decision to be authority for the proposition that the court has a discretion to make an unless order after the making of a final order; however, I do not need to and I do not purport to determine that the court never would have a discretion to do either of those things. It seems to me the factual scenarios which may present themselves in litigation are almost endless and it is clear that Zacaroli J himself, going beyond previous authority, considered whether it was appropriate to make orders based on first principles.[25]In this case, however, I consider that it would be inappropriate to prevent the claimants from enforcing against other defendants in relation to unpaid final costs orders against the fourth and sixth defendants. And I come to that conclusion taking into account also the other matter relied upon by Mr Glover, which is that there are unmet costs orders going the other way.[26]I referred the parties to a decision of Richard Smith J and myself handed down in December 2025, Hasbro Consumer Products Licensing Limited & Anor v Cong Ty Tnhh Dau Tu Cong Nghe Va Dich Vu Sconnect Viet Nam & Ors [2025] EWHC 3450 (Ch). The issue that arose in that application is very similar to the issue here in relation to Mr Glover’s second point. One party had obtained a costs order in its favour but there were substantial costs issues from earlier hearings in the proceedings in respect of which all of the costs had been reserved and required yet to be determined and it was not clear to the court when the unless order application came on for hearing which way the ultimate instance of costs would lie. It therefore seemed inappropriate, as a matter of discretion, to make an unless order in those circumstances. I consider that similar considerations apply here (as the costs payable by the fourth and sixth defendants may at least approach those payable the other way) and that in all of the circumstances, and considering also the size of the judgment debt as far as the third defendant is concerned, this is not an appropriate case for an unless order.[27]I would finally refer to some specific points which Ms Goodman made in support of her clients’ application. First of all, I would not accept that there is a Henderson v Henderson (1843) 3 Hare 100 abuse resulting from the fact that the claimants did not submit to Mr Twigger KC that he should not order a payment on account because of the costs orders the other way. It is almost always the case when an unless order application comes before the court that points are raised in resistance to it which could have been made when the costs order was made. Whilst the failure to make such arguments when the order was made is material to the question whether to make an unless order (as explained in Michael Wilson & PartnersLimited v Sinclair), it does not seem to me a significant factor here in light of the points I have already discussed.[28]I do not consider the fact that the Court of Appeal was asked to stay enforcement of the payment on account pending the application for permission to appeal Mr Twigger KC’s order is material now that application has been dismissed by the Court of Appeal, nor do I consider that a refusal to make an unless order would render the costs order of no effect. There is no dispute that the fourth and sixth defendants are perfectly at liberty to seek to enforce that costs order. What has not been provided is an explanation why they could not or did not seek to do that first.[29]Some criticism was made by Ms Goodman of the late stage at which these points were raised by the claimants. There is something in that point but I also bear in mind that the burden of establishing that an unless order should be made lies squarely with the applicant and I do consider that the costs orders the other way ought to have been raised in the evidence in support of the application, so the fact that it was raised very late by the claimants is not itself to be held against them.[30]For all of those reasons I will dismiss the application for an unless order but, as I have indicated, it being accepted by the claimants that the sum of £20,000 that was paid out of court and ought not to have been paid to them but ought to have remained in court, I am going to direct that that sum be paid back to the fourth and sixth defendants, thus giving effect to Mr Twigger KC’s order that it be paid out of court to them. - - - - - - - - - - - - - - - - (This Judgment has been approved by the Judge.) Digital Transcription by Marten Walsh Cherer Ltd 2nd Floor, Quality House, 6-9 Quality Court, Chancery Lane, London WC2A 1HP Telephone No: 020 7067 2900 DX: 410 LDE Email: info@martenwalshcherer.com Web: www.martenwalshcherer.com