Ricardo Benjamin Salinas Pliego & Anor v Astor Asset Management 3 Limited & Ors [2025] EWHC 2968 (Comm)

[2025] EWHC 2968 (Comm)Case No CL-2024-000450
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
KING’S BENCH DIVISION
COMMERCIAL COURT
Venue Royal Courts of Justice, Rolls Building, Fetter Lane, London, EC4A 1NLDate 13/11/2025
Before
STEPHEN HOUSEMAN KCsitting as a Deputy Judge of the High Court
Between
(1) RICARDO BENJAMIN SALINAS PLIEGOClaimants(2) CORPORACION RBS SA DE CVClaimant(1) ASTOR ASSET MANAGEMENT 3 LIMITEDDefendants(2) WEISER GLOBAL CAPITAL MARKETS LTDDefendant(3) TAVIRA MONACO SAMDefendant(4) VLADIMIR SKLAROVDefendant(5) CORNELIUS VANDERBILT CAPITAL MANAGEMENT LTDDefendant(6) ASTOR CAPITAL FUND LIMITEDDefendant
John Wardell KC, Richard Greenberg & Stefanie Wilkins (instructed by LK Law LLP) for ClaimantsSimon Davenport KC & Daniel Khoo (instructed by PCB Byrne LLP) for First & Fourth DefendantsNiranjan Venkatesan KC & Alexander Georgiou (instructed by PCB Bryne LLP) for First & Fourth to Sixth DefendantsHearing Hearing dates: 3-5 November 2025
Approved JudgmentThis judgment was handed down remotely at 15:00 on 13 November 2025 by circulation to the parties or their representatives by e-mail and by release to the National Archives..............................

Stephen Houseman KC :

[1]The litigating parties have presented me with a difficult choice. What should the Court do when someone with an apparently strong and substantial, perhaps unanswerable, claim in fraud seeks summary judgment in light of illicit knowledge obtained by unethical means?[2]This difficult situation is presented by two applications listed to be heard together pursuant to a direction of Robin Knowles J:(i) an application by the claimants dated 5 March 2025, bearing a time estimate of 10 hours, seeking summary judgment on the liability elements of their pleaded claims in deceit and contract against the first and fourth defendants, alternatively a conditional order requiring security to be provided in the sum of US$315 million; and(ii) a cross-application by the first and fourth to sixth defendants dated 18 June 2025, bearing a time estimate of 15 hours, seeking (a) to strike out or stay the action for abuse of process and/or risk of an unfair trial; and (b) directions as to the inadmissibility or permitted future use of certain evidence obtained illicitly by the claimants.[3]The first and fourth to sixth defendants - referred to as “the Astor Defendants” for convenience - made a further application dated 19 September 2025 seeking(a) discharge of worldwide freezing orders (WFOs) as an alternative to striking out or staying the action; and(b) other relief concerning the claimants’ acquisition of such illicit information or their freedom to use any of it. An attempt to have the WFOs discharged for alleged material non-disclosure and unfair presentation failed before Calver J in October 2024. An appeal against that decision was dismissed earlier this year: see [2025] EWCA Civ 1060.[4]The circumstances giving rise to the present applications, in particular the cross-applications, are unusual. They are also quite concerning.[5]The Astor Defendants’ litigation solicitor was deceived into meeting a private investigator in the belief that he was pitching for a new client represented by them. He divulged information and offered insights into the perceived strengths and weaknesses of his clients’ position in these proceedings, including aspects of their litigation and settlement strategy. The meetings were secretly filmed and recorded. Those video and audio recordings were provided to the claimants who then applied for summary judgment.[6]The Astor Defendants contend that such illicit knowledge comprises or includes matters protected by legal professional privilege belonging to them. They say that it was sought and obtained by the claimants so as to gain an unfair advantage; it cannot be forgotten or ignored, and will probably - indeed, inevitably - influence the claimants’ own future conduct of this litigation; and, accordingly, the pursuit of this action (or, alternatively, continuation of the WFOs) is abusive and likely to obstruct a just disposal of these proceedings. This is so irrespective of the strength of the claims against any of them.[7]The claimants now accept, correctly and candidly, that the methods employed to obtain this illicit knowledge from their adversary’s solicitor were unethical. However, they disavow responsibility for use of such methods; they deny receiving or obtaining insight into any privileged communications, invoking (so far as necessary) the iniquity principle; they say they gained no unfair advantage in the litigation; and irrespective of such illicit knowledge they seek summary judgment. Come what may, they say it would be disproportionate to strike out their claim in circumstances where that would leave the fourth defendant (“Mr Sklarov”) free to enjoy the fruits of his own significant fraud.[8]These matters were argued over the course of 2.5 days with a day of pre-reading. Three skeleton arguments were filed, totalling over 160 pages and featuring almost 600 footnotes. A total of 122 legal authorities were cited. The hearing bundles contain over 7,500 pages and occupy 25 lever arch files. This includes 14 witness statements (two served during the hearing) and five expert reports, plus numerous references to parts of 16 further affidavits or statements served earlier in these proceedings. These metrics reflect the complexity and gravity of the issues in play. They also demonstrate the difficulty of doing justice to all potential issues in the time available.[9]I have not found it easy to decide what to do in these circumstances. As indicated during the hearing, it feels appropriate to grant permission to appeal and cross-appeal irrespective of the outcome. The impact of the claimants’ litigation behaviour, which I regard as abnormal and abusive, deserves evaluation by reference to the competing public and private interests at stake. I return to this aspect at the end of my judgment.

Relevant Background

[10]The background to and nature of the present dispute are summarised by Calver J in his judgment refusing to discharge the WFOs: see [2024] EWHC 2522 (Comm) (paragraph references appear below). In short:(i) The claimants allege that they were deceived into concluding a Stock Loan Agreement dated 28 July 2021 (“SLA”) with the first defendant (“Astor 3”); and the first claimant (“Mr Salinas”) was likewise deceived into transferring a substantial number of shares in a Mexican company (“Elektra Shares”) to two appointed custodians, the second and third defendants, as collateral for the loan by Astor 3 to the second claimant (“RBS”). This financing structure is said to have been used by Mr Sklarov as part of a fraudulent scheme to expropriate the Elektra Shares, using some of the sale proceeds to finance the loan to RBS. This is the deceit claim.(ii) The claimants also seek damages for breach of the SLA by Astor 3 through its transfer and disposal of the Elektra Shares to or via the fifth defendant (“Vanderbilt”). This is the contract claim.(iii) Other pleaded claims include conspiracy, breach of trust or fiduciary duty, dishonest assistance and knowing receipt. They are not the subject of the claimants’ application for summary judgment.[11]Calver J was satisfied that there is a good and perhaps strongly arguable case that (at least) the deceit claim will succeed at trial: see e.g. [10], [24], [31], [41], [59], [61], [73]-[74], [76], [82], [104] & [128]. This interlocutory conclusion rests in part on evidence showing that Mr Sklarov has gained notoriety for using companies with evocatively misleading names to perpetrate “stock-lending frauds” or “stock-based loan fraud” similar to that alleged by the claimants here: see [62]-[72]. Part of his modus operandi is the use of deliberately vague contractual terms, such as those found in the SLA, in order to justify what he calls ‘rehypothecation’ of loan-stock on the basis of spurious security rights or contrived events of default. Calver J noted in this context at [48] & [54] that the SLA itself is “ambiguously worded”.[12]The claimants contend that they were deceived in a number of ways to enter into this financing arrangement resulting in the loss of the Elektra Shares. There is contemporary evidence to support this deceit claim. Mr Sklarov and a business associate, Mr Skachkov, used false names; the lender (Astor 3) was misrepresented as being part of an established and reputable finance business with strong ties to the well-known Astor family in the USA, when it was no such thing; the source of funds for the loan itself was misleadingly described and appears to have derived from unauthorised sales of Elektra Shares commencing shortly after the SLA was concluded; whilst elaborate steps were taken to conceal the disposal of the loan-stock including through fabricated statements of account showing accrual of dividends.[13]The proceeds of this fraudulent scheme found their way largely if not entirely into the pocket of Mr Sklarov himself, although he denies controlling the corporate entities. His asset disclosure evidence served pursuant to the WFOs is said to be inadequate. An application to commit him for contempt is pending.[14]The present claim was commenced on 2 August 2024 when the first of the WFOs was obtained ex parte against the first to fourth defendants. Particulars of Claim were filed/served on 27 September 2024. The Astor Defendants filed their Defence and Counterclaim on 10 January 2025. Tavira filed its Defence on 17 January 2025. Weiser filed its Defence and Counterclaim on 9 May 2025.[15]In the meantime, a company associated with the claimants (“NEM”) retained the services of a business intelligence and strategic consultancy firm called B.C. Strategy UK Limited (“BC”). This was done through and pursuant to a Letter of Engagement dated 27 August 2024 (“BC Retainer”).[16]A redacted version of the BC Retainer is in evidence. Redactions have been made on grounds of unilaterally-asserted commercial sensitivity and irrelevance to the issues before the Court. As regards this document:(i) It defines NEM as “the Client” in the introductory section or recital.(ii) It comprises 23 numbered clauses spanning six pages, plus a 2-page Annex headed “Annex 1 - Primary objectives of the project”.(iii) The primary objectives involve supporting “the Client’s legal efforts to obtain compensation for the damages caused by and to recover Elektra stock value caused by the alleged fraud suffered by the Client” (my emphasis). This reflects and augments the wording of clause 4 (“Objectives”). Both clause 4 and Annex 1 refer to such scope of work as “the project”.(iv) Annex 1 identifies three individuals by name, as well as Mr Sklarov, as persons of interest for the investigation to be conducted by BC. One of those individuals is a foreign lawyer alleged to have facilitated the fraudulent scheme. Another is a person who was targeted and interviewed by BC. None of these identified persons are legal professionals with any involvement in these proceedings, past or present.(v) It is signed on behalf of BC by its sole director and founder, Dr. Avi Yanus. By the end of the hearing he had made four witness statements. His third statement was shown to me and admitted on the second sitting day pursuant to an application made by the claimants on my pre-reading day (31 October). His fourth statement was shown to me on the final morning of the hearing and sought to be admitted pursuant to a further application notice issued by the claimants during the second sitting day (4 November). I deal with this supplemental evidence separately below.(vi) It is signed on behalf of NEM by Gabriel Roqueñi. He is understood to be a senior executive within the Elektra corporate group of which Mr Salinas is founder and principal. Mr Roqueñi has not provided any evidence in these proceedings. The claimants have not identified who communicated with BC or what information was given to BC in order to assist it with this project: see paragraph 19 below.(vii) Clauses 1 to 3 are headed “General”. Clauses 1 and 2 describe BC’s capabilities and reputation. This includes impressive expertise of its personnel involving “a select group of veterans of elite units in the Israeli intelligence community, combined with financial and legal experts”. Clause 3 is redacted.(viii) Clauses 5 to 7 are headed “The Research Processes”. They deal with how BC is to provide services pursuant to the agreed scope of work and in furtherance of the primary objectives. Clause 6 states that NEM will provide “all the relevant information that could support the evidence-gathering operations” with three categories identified as illustrations. The third category is “[a]ny documentation that the Client deems relevant to the purpose of the investigation” (my emphasis).(ix) Clauses 8 to 12 are headed “Human Intelligence (Humint) approach”. These five provisions outline techniques used by BC with “unique expertise in social engineering, psychological and behavioural pattern-identification, and web capabilities” (clause 10).

(x) Clauses 8 & 9 provide as follows:

“8. Building on the research described above, [BC] will identify and select optimal subjects (hereafter the “Humint Targets”) to approach in order to extract the intelligence. 9. [BC] will then find the best access points to the Humint Targets and create elaborate, personalized cover stories for each subject selected by the team and approved by the Client.” (my emphasis) (xi) Clauses 11 & 12 describe methods used by “field agents” and “operatives” to extract human intelligence from targeted individuals, i.e. to build “personal and/or professional relationships with each of them to extract relevant information and evidence” (clause 12). (xii) Clauses 16 to 22 are headed “Schedule and Fees”
. These seven clauses occupy about one and a third pages of the BC Retainer, equating to roughly a third of the text comprising the 20 substantive terms found in clauses 4 to 23. Clauses 16 to 22 are redacted in their entirety. The claimants’ solicitors have refused to disclose any details about the structure or size of the fee paid to BC. (xiii) Clause 23 makes provision for the addition of VAT “according to English law”. Although there is no express choice of governing law in the BC Retainer, I was invited to proceed on the basis that its meaning is as appears on its face to an English lawyer. (xiv) Immediately above the signature space for the Client there is a statement of agreement to BC’s Terms and Conditions. I was not shown them. I assume they contain a choice of English law. I proceed on the basis that they do not impact anything I have to decide by reference to the contents of the BC Retainer.[17]Before turning to what BC did and what material they obtained, I make some observations about their engagement, including by reference to words quoted with added emphasis above:(i) NEM is not a claimant. It has suffered no loss or “damages” at the hands of any of the defendants or anyone else. It has no role or stake in any “legal efforts” to obtain compensation or recover stock value. Nor has it any independent means of deeming what documentation is “relevant” to the project. As noted above, there is no evidence from Mr Roqueñi or anyone else on behalf of NEM as to who communicated with or provided information to BC. Mr Salinas has not provided any evidence.(ii) Clause 9 appears to require that BC’s selection of any so-called ‘Humint Target’ or “subject” must be “approved by the Client”. It is hard to see how NEM had any independent competence to give such approval in light of my observations above. Approval of this kind would have been needed from someone acting on behalf of the claimants with knowledge of this litigation in all likelihood, at any rate for targeting a person not identified by name in Annex 1.(iii) It is difficult to see how BC could “extract” any “intelligence” from a legal representative of an adversary or suspected wrongdoer without being given meaningful insight into the nature and nuances of the particular legal dispute, here comprising the “primary objectives” as defined in the BC Retainer. In order for BC to do its job effectively and earn its reward by questioning this type of human target it would in all likelihood be made privy to privileged and confidential information belonging to the claimants in this matter.[18]I will from this point refer to the Astor Defendant’s litigation solicitor who was targeted by BC as “X”. For simplicity I will refer to the BC operative who conducted the relevant meetings as “BCO”.[19]The process by which BC identified and targeted X remains opaque. This is so despite multiple attempts by the claimants to give and clarify witness evidence around - if not on - this important point.(i) In his first witness statement dated 5 March 2025, Dr Yanus stated (at paragraph 12) that BC was “left to conduct the investigation” and “did not exchange any emails or WhatsApp messages with the Client until the investigation was complete”. This evidence was clarified by his third witness statement prepared in light of the Astor Defendants’ contention that the claimants intended or expected BC to go ‘privilege hunting’ by targeting X or someone in his position, as occurred.(ii) The clarification offered by Dr Yanus in paragraph 6 of his third witness statement left open the possibility that someone not acting on behalf of NEM itself was involved in the decision to approach X or informed about it at the time. Dr Yanus ignored the approval requirement in clause 9 (quoted above) in each of his first three statements. He gives no explanation as to how he or his team chose to target X in order to extract intelligence pursuant to the terms of the BC Retainer.(iii) I am not prepared to admit Dr Yanus’ fourth witness statement in evidence. It was served far too late and does not respond to any new evidence. It is not appropriate to drip feed clarificatory evidence of this kind during a hearing, especially not a purported clarification of a belated clarification of witness evidence served for a hearing. Come what may, I do not regard the purported explanation (in paragraph 6) as to why BC identified the relevant solicitor as one of their “Humint Targets” as remotely credible. This looks like an attempt to insulate or distance the claimants from the decision to target X.(iv) Most telling in all of this is the absence of any explanation as to how the decision was made to target X. By way of contrast and as noted above, the other person targeted by BC was identified by name in Annex 1 to the BC Retainer, as was a foreign lawyer engaged by Mr Sklarov.(v) So far as relevant, the claimants’ own witness evidence contains no denial of their involvement in the decision to target X - despite being challenged on this aspect. The invocation of privilege in respect of a meeting at which BC was given some information or instruction is not dispositive, as the claimants’ knowledge and conduct must have extended beyond this - including details found in Annex 1 to the BC Retainer; cf. paragraph 12 of Dr Yanus’ second witness statement.(vi) The claimants’ own witness evidence in support of summary judgment appears to acknowledge that an “instruction” was given to BC regarding the targeting of X in this way: see paragraph 33 below. This does not sit comfortably with the evidence given by Dr Yanus.(vii) I readily infer that (at least) the identity of X was provided to BC by someone on behalf of the claimants or easily identified from some inter partes correspondence provided to BC pursuant to clause 6 of the BC Retainer. Whether or not a specific instruction was given to BC to target X doesn’t ultimately matter; but it appears likely that there was some form of instruction or approval of his selection as a target by BC, as required by clause 9 of the BC Retainer.(viii) This evidential episode does not reflect well on the claimants. The Court is left with the distinct impression that they are choosing to hide details which show the extent of their own role in targeting their adversary’s litigation solicitor in order to extract sensitive intelligence from him to assist them in these proceedings, as then occurred.[20]As regards BC’s fees for their work, nothing has been disclosed or explained. It seems probable that clauses 16 to 22 of the BC Retainer contain some kind of fee scale or structure dependant on certain circumstances or contingencies. As to this aspect:(i) A “bonus structure” of this kind was agreed between BC and a company engaged by The Catalyst Capital Group Inc. as part of ‘Project Maple Tree’ undertaken by BC in Canada during 2017. This and other aspects of BC’s activities are recorded in a judgment of C. Boswell J dated 11 January 2021 dealing with an assertion of litigation privilege in respect of BC’s retention and performance of those particular services: see The Catalyst Capital Group Inc. & others v. West Face Capital Inc., BC Strategy Ltd., BC Strategy UK Ltd. & others¸ 2021 ONSC 7957.(ii) On that occasion, BC’s project involved a so-called “pretext investigation” which targeted Justice Frank Newbould KC, a recently-retired Superior Court Justice who had given judgment adverse to BC’s ultimate client (Catalyst) in hard-fought litigation with a rival private equity business based in Toronto. Meetings were arranged on a false pretext during which the retired judge was “baited by the operative in an effort to elicit anti-Jewish sentiments” albeit without success. BC lied to Justice Newbould, took him to dinner and bought him drinks, doing their best to dupe him into making remarks against Jews or Catalyst, whilst secretly recording him: see [53], [89], [367]. BC’s base fee on that occasion was US$1.5m, but could have risen to US$11m through the agreed bonus structure: see [379].(iii) It is noteworthy that the principal and founding partner of Catalyst (Mr Glassman) denied any knowledge of BC’s plan to conduct a pretext investigation on Justice Newbould: see [90]. Such disavowal found no favour in circumstances where Catalyst was prepared to pay BC such a high fee by reference to the fruits of its covert operation. This involved looking through to the substance of the transaction: it is the commercial stakeholder (i.e. litigant) who is buying information and they share responsibility for how it is done: see [378]-[379].(iv) Further details of BC’s fee on that occasion are summarised in a later judgment of McEwen J dated 2 December 2021: see The Catalyst Capital Group Inc. v. West Face Capital Inc. & others, 2021 ONSC 7957 at [28]. This included a US$75,000 “per item” bonus if BC’s operatives could obtain evidence that Justice Newbould was biased against Catalyst/Glassman or held anti-semitic views, for example. BC’s conduct was described as “an affront to justice” even though it yielded none of the material being sought.(v) The Court has no way of knowing whether or how the team involved in targeting X, including BCO himself, were separately rewarded for their work on this project. A personal bonus or bonus-sharing scheme is not hard to imagine, but its existence or terms are not material.(vi) The wholesale redaction of clauses 16 to 22 of the BC Retainer and the claimants’ refusal to reveal how much BC was paid, by or through whom or for what precisely, provides essential context to evaluate their bare denial that they intended or expected BC to engage in conduct of the kind they did pursuant to the BC Retainer. The claimants have refused to identify the process by which BC chose to target X.[21]In these circumstances, I am satisfied on the balance of probabilities that the claimants intended or expected BC to engage in the kind of unethical conduct which took place and for which BC was paid an undisclosed fee. Whether or not the claimants expressly approved a pretext investigation or sting operation upon or against an opposing litigation solicitor such as X (or X himself) does not matter. There is no evidence to suggest that they were shocked or surprised to receive the fruits of that covert operation; on the contrary, they sought to make use of this illicit knowledge in their summary judgment application.[22]I was not addressed on who bore the burden of proof in this specific context. As already noted, the claimants’ leading counsel accepted at the outset of the hearing that the methods used by BC were unethical (Transcript Day 1, p.9 lines 7 to 13). The claimants control all of the evidence relating to what they knew and did or did not do at the time. There is obvious sense in placing the burden on them to show they were not involved in the selection of X as a target by BC.[23]My conclusion would be the same even if the burden rests or remains upon the Astor Defendants. The claimants have brought this upon themselves by their own litigation choices, including attempts to augment and clarify witness evidence in a way that ended up both incoherent and incredible. This behaviour does them no credit in the eyes of the Court even if falling short of being an abuse of process itself.[24]The claimants’ attempts to distance themselves from the methods employed by BC champion form over substance and artificiality over reality in a way that is ironic, and indeed hypocritical, given their own case thesis in this litigation. They describe BC as an independent contractor rather than agent or sub-agent. They suggest that ratification is overly-technical to describe the claimants’ enthusiastic receipt, retention and deployment of the illicit information sold to them or procured through a corporate intermediary.[25]It follows that the claimants themselves engaged in unethical behaviour with a view to obtaining an unfair litigation advantage. This finding is both important and serious. Such behaviour is anathema to the fundamental basis or premise of civil proceedings. This conclusion does not require what took place to be labelled as ‘privilege hunting’ or given any other emotive or forensic label. Nor does it depend on the precise evidential status of any of the information obtained by such unethical methods.[26]The transcripts of the relevant meetings are extensive. The audio recordings (covering both targeted subjects) last a total of about nine hours. Both sides took me to isolated snippets of transcripts. I viewed edited extracts of the video footage provided to me by the claimants’ legal team. For convenience, I refer to the totality of this information as the “illicit information” and its ingestion by the claimants as their “illicit knowledge”.[27]My observations can be summarised as follows, including by reference to the witness statement of X himself:(i) X was induced to meet on a false premise or basis. He was told that BCO represented a client with a substantial dispute and they wanted to interview him with a view to engaging his services. This was a lie. It is similar to the lie told by BC to Justice Newbould in the Catalyst case (potential arbitral client). I doubt I am alone in regarding the word ‘pretext’ as somewhat euphemistic.(ii) There were three meetings. The first was conducted virtually with X in England for about one hour. The next two were held abroad in person on a single day: over lunch in a business environment and then dinner with alcoholic drinks in a restaurant, totalling about 5.5 hours. A local private investigation firm was retained by BC to assist with this process. Further email communication between BCO and X followed the meetings.(iii) Through these three meetings, spaced apart as they were, X was skilfully and tenaciously steered by BCO into discussing various aspects of the litigation and settlement strategy of his clients, including by reference to the WFOs. This involved persistent questioning designed to elicit insights into Mr Sklarov’s business model or practices, his de facto control of corporate entities involved in this alleged fraud, the perceived legitimacy or otherwise of such practices, and the merits of the claim and his defence to such claim.(iv) On numerous occasions, BCO interrupts X so as to sharpen the focus of an answer or bring the subject back on track. Sometimes this is done by offering a selective or salacious recap of what he pretends to understand X has just told him (e.g. references to “Ponzi” and “Madoff”); other times by insisting on greater clarity where X has said something potentially ambiguous. On other occasions, X is left to speak freely because he is divulging what is being targeted and harvested by BCO. This may not amount to ‘baiting’ as occurred with Justice Newbould. However, it has all the hallmarks of persistent leading, channelling and swarming of questions designed to pressure the interviewee into privileged and confidential territory.(v) At no point did BCO express any reservation or inhibition about X delving into confidential or potentially privileged territory. On the contrary, the line of questioning was designed to encourage X to do so whilst thinking he was in a safe environment. It is hard to imagine (a genuine intermediary of) a genuine prospective client behaving in this way or feeling comfortable with someone else’s solicitor speaking so freely and candidly about such sensitive matters in pending litigation - at any rate without saying something to sign-post their discomfort or break the momentum of candour.(vi) It is clear that BCO was very well briefed about the issues in these proceedings and nuances about the case. This is what enabled such close and careful interrogation of X. The preparation for that exercise must have been extensive, far exceeding the 4-5 hours estimated as judicial pre-reading for the present hearing. It is likely to have involved access to privileged and confidential information belonging to the claimants: see paragraph 17(iii) above. This degree of insight on the part of an interviewer is far removed from a situation in which (a genuine intermediary of) a genuine prospective client meets with a solicitor in good faith in order to evaluate their expertise and suitability for a specific dispute. The two scenarios are incomparable.(vii) The spacing apart of the meetings may have formed part of BC’s use of its professed expertise in “psychological and behavioural pattern-identification”. It appears to have allowed BCO a better opportunity to build a “personal and/or professional” relationship with X, as promised by the terms of the BC Retainer. This no doubt increased trust and candour, something BCO needed in order to extract sensitive information from X.(viii) X has explained in his witness statement why he engaged as he did during these meetings, e.g. out of courtesy or cultural sensitivity and an eagerness to impress. I prefer to say nothing about his interpretation given the potential disciplinary investigation he is now facing. He comments about the effect of alcohol at dinner, as someone who rarely drinks; but there is no evidence suggesting that his drink was spiked.(ix) X was lulled into a false sense of confidence and security, as evidenced by how he started to share personal information about his non-professional life and family members. He was the victim of a contrived rapport and false sense of confidence that encouraged an excess of candour. He was deceived and played for a fool by a skilful and well-prepared interrogator armed with insider knowledge.(x) X did all of this as a newly-promoted partner in the hope of winning a major client, and potentially building on that professional success down the line. Despite the deception and manipulation practised upon him by BCO, X is responsible for any breach of client confidentiality.[28]The claimants say that X committed serious professional misconduct and that any complaints made by the Astor Defendants are properly directed at him alone. Their refrain before me was that ‘there should have been a nil return’ and this is all the fault of X. I reject that submission.(i) For the reasons given in paragraph 27 above, it is wholly unrealistic to suppose that X would have revealed what he did to (a genuine intermediary of) a genuine potential client in meetings convened to explore his professional experience and capabilities. BCO’s conduct of those meetings in bad faith bears no resemblance to the genuine scenario sought to be replicated or imitated through this covert operation.(ii) BC was paid an undisclosed sum in order to use professed expertise to “extract the intelligence” by use of an “elaborate, personalized” cover story, to quote from their own retainer. It is hard to see what value BC would be adding, or why BCO conducted the covert interrogation in the manner that he did, if it just replicated a normal and honest situation.(iii) The fact that X himself does not speculate about this hypothetical counterfactual in his witness statement does not preclude me from reaching my own conclusion based on the material I have seen and heard. I am satisfied that the way in which the meetings were conducted were designed to encourage or pressure him into revealing matters that were confidential to his clients and should never have found their way into the hands of a litigation adversary.(iv) I accordingly reject the contention at paragraph 157(3) of the claimants’ skeleton argument that X “would have provided the same information to a genuine potential new client”. The so-called ‘causation issue’ raised as a primary answer by the claimants must also fail; cf. paragraphs 208-212 of their skeleton argument.[29]For the purposes of my judgment, little more needs to be said about these events. The claimants’ solicitors at the time were unaware of the engagement of BC by their clients. They refused to look at the video files or listen to the audio files. They were promptly replaced by the claimants’ current solicitors who appear to have no such inhibition.[30]For the avoidance of doubt, I proceed on the basis that there was nothing unlawful or illegal about the way the illicit information was obtained from X or transmitted to the claimants or their new solicitors. As already noted, the claimants’ leading counsel accepts that it involved unethical behaviour. The stated basis of such concession was the deceptive basis of the meetings. I would go further than this: the process of extracting the illicit information from X was itself unethical (see paragraph 27 above).[31]The claimants’ new solicitors have referred X to the Solicitors Regulatory Authority for potential disciplinary investigation. The basis for this referral was stated to include his divulgence of information confidential to his clients in the meetings with BC summarised above. Their position before me is that there was no confidence in any of the information he divulged because it revealed, or indeed involved, iniquitous conduct or was otherwise obvious from steps in the litigation or public domain.[32]The claimants made their application for summary judgment on 5 March 2025. They waited for the majority of the defendants to file their pleadings under statements of truth before revealing the acquisition of illicit knowledge through BC’s covert operation. This approach may have been chosen in order to trip up or catch out their adversaries.[33]The summary judgment application is primarily supported by a witness statement of Andrew Ford, a principal of the claimants’ new firm of solicitors. It runs to 51 pages plus 15 pages of schedules. I note the following:(i) There is no attempt by Mr Ford to hive off the illicit information; on the contrary, it is stitched into the main narrative and analysis where curated extracts from the meeting transcripts are quoted. It is tempting to surmise that these selected snippets are the kind of ‘hits’ or ‘units’ that BC was financially incentivised to elicit from someone like X pursuant to clauses 16 to 22 of the BC Retainer, but that is not material to my conclusion.(ii) Mr Ford refers to BC as one of the “private investigation teams” of the claimants themselves (paragraph 23). He was not concerned with privity or corporate personality or other legal technicalities when describing them in this way. I take his description to represent the reality of the arrangement, consistent with my findings set out above.(iii) Paragraph 52 of this witness statement states:
“I wish to comment upon the covert recording featuring [X]. As Dr Yanus describes, this instruction was given on behalf of the Claimants direct; that is, not by or with the knowledge of [their solicitors]…” (my emphasis). This is the “instruction”
I allude to in paragraph 19(vi) above. (iv) Mr Ford’s treatment of the information acquired by BC on behalf of the claimants, both from X and from the other human target, fills 13 pages of his witness statement. This includes his analysis as to its evidential status, including his own analysis as to the application of the iniquity principle (paragraphs 53 to 55).[34]The impetus for the summary judgment application obviously involved the claimants’ acquisition of the illicit knowledge. The claimants sought to take the benefit of their own unethical behaviour to gain an advantage in this litigation. They also sought to benefit from it, albeit without disclosing it, by engaging in WP negotiations with (some of) the defendants prior to launching the summary judgment application itself.[35]The Astor Defendants lost their original solicitors through this episode. X now faces a professional disciplinary process and potential reputational ruin.[36]Despite the heading to this section of my judgment, it contains serious findings about the claimants’ behaviour and how it ought to be characterised. I return to this characterisation and its consequences below after summarising the applicable legal principles.

Legal Framework

[37]As regards summary judgment, the applicable test is well-known both in form and practice. The Court has a discretion whether or not to enter summary judgment (CPR 24.3) or make a conditional order (CPR 24.6). That discretion can be exercised against a claimant even if satisfied that(a) there is no real prospect of a claim or issue being defeated at trial and(b) there is no other compelling reason for a trial. Such discretion falls to be exercised in the interests of justice and in furtherance of the overriding objective of the CPR.[38]Abuse of process concerns protection of the integrity and authority of the adjudicative function performed by the Court. This forms part of an inherent self-regulatory jurisdiction. It allows steps to be taken, including at the Court’s own motion or initiative, to remedy or prevent abnormal use of its function by or on behalf of a litigant.[39]The categories of abuse are not closed. No attempt should be made to define or delineate what can or cannot be an abuse in any given circumstances: see commentary and authorities cited in 2025 White Book at 3.4.3 to 3.4.17.[40]The Court is ordinarily concerned with an objective inquiry as to the quality of conduct, rather than examining a subjective state of mind. However, abuse sometimes involves pursuit of a claim or issue in bad faith or for a collateral purpose which in turn involves an inquiry into knowledge or intention. The civil standard of proof is applied in all cases, i.e. balance of probabilities.[41]Although founded in the inherent jurisdiction, the express power to strike out for abuse of process is contained in CPR 3.4(2)(b). That provision has two limbs: “the statement of case is an abuse of the court’s process or is otherwise likely to obstruct the just disposal of the proceedings” (my emphasis).[42]The rule focuses on a “statement of case” but it has been interpreted more broadly to include abusive behaviour(i) which occurs other than in or through a statement of case and(ii) which may justify striking out a claim or defence with terminal effect for the relevant litigant. This codified power does not cut down the scope of the Court’s potential response to an abuse of process, as addressed further below.[43]The words given emphasis above show that the two limbs are disjunctive. The second limb can operate where there is no actual/accrued or anticipatory/future abuse of process. It protects the integrity of the adjudicative function in a different way, i.e. by reference to the ability to conduct a fair trial consistent with common law notions of natural justice and the participants’ rights conferred by Article 6 ECHR. I was asked to proceed on the basis that this second limb is intended to reflect that broader position, whilst not itself cutting down the scope of the Court’s inherent jurisdiction or indeed primary responsibility to administer justice in accordance with the overriding objective.[44]That said, it is possible for the second limb to involve or arise out of behaviour characterised as an abuse of process. In this sense there are two broad categories or species of abuse of process: one which is concerned solely with the quality of behaviour and another which is concerned with the impact of that behaviour on the future course of a case and the integrity of its determination: see Raja v. van Hoogstraten [2006] EWHC 1315 (Ch) at [31]-[32] (defendant’s complicity in the murder of the claimant).[45]Some types of behaviour - e.g. forgery or falsification of documents, deliberate suppression or destruction of documents, perjury, hacking or intrusion, witness tampering or intimidation - can be characterised as abusive because they create a substantial risk of an unfair trial: see e.g. Arrow Nominees Inc. & another v. Blackledge & others [2001] BCC 591 at [54], [56]. This does not mean that the relevant behaviour itself is not abusive. It depends on the circumstances.[46]The distinction between the two limbs of CPR 3.4(2)(b), and a related distinction between what I would call actual abuse and anticipatory abuse, has some importance in the present case. That is because the impact of abusive behaviour may be such as to confer an illegitimate advantage upon one litigant (e.g. acquiring knowledge derived only from privileged communications) that is invidious and jeopardises a fair trial. That is a problem in itself. It is distinct from the abusive behaviour by which such state of affairs comes about in the first place.[47]It is possible for abuse of process to occur through steps taken outside the litigation - what was referred to during this hearing as ‘non-White Book’ behaviour - and perhaps outside the territorial jurisdiction altogether. Such extra-procedural behaviour can be contrary to the basic norms or values of civil litigation whether or not it has the effect of circumventing or frustrating the purpose of any specific provision of the rule book itself. The CPR does not expressly prohibit types of misconduct. Some behaviour is anathema to how civil litigation works and amounts in effect to cheating the system. This is still abuse of process, even though the abuse is not procedural in a formal sense.[48]Turning the focus onto privilege in this context:(i) Legal professional privilege is inviolate. Its protection forms a fundamental basis of our legal system and underpins the Rule of Law. An attempt to get access to an opponent’s privileged communications is anathema to the fundamental norms and values of civil litigation.(ii) PD57AD and other procedural or regulatory regimes legislate for what a party or its solicitor should and should not do when they receive privileged material which has been inadvertently disclosed or provided for inspection by an opposing party. There is no regime covering deliberate acquisition of another party’s privileged material. This is hardly surprising, as discussed more generally in paragraph 47 above.(iii) It can be an abuse of process to take unethical steps to obtain information from an adversary’s litigation solicitor even if that information is not privileged or any privilege that would otherwise attach to it is precluded by the iniquity principle or destroyed by loss of its confidential character. The impact of such abusive behaviour is a different matter and may well depend on the precise evidential status of such illicit information: see paragraph 46 above.(iv) By way of analogy, the receipt and use of an opposing party’s internal legal documentation, whether or not it was all covered by privilege, has been found to comprise “the most severe abuses of the arbitral process” which themselves justified setting aside a substantial award on the grounds of public policy: see The Federal Republic of Nigeria v. Process & Industrial Developments Ltd. [2023] EWHC 2638 (Comm) at [516].[49]The iniquity principle depends on whether a lawyer/client relationship is being abused, something which may necessitate a “document by document” analysis: see Al Sadeq v. Dechert LLP & others [2024] EWCA Civ 28; [2024] KB 1038 at [168]. It is agreed before me that this would require a ‘topic by topic’ analysis of the meeting transcripts, if not a ‘line by line’ or ‘answer by answer’ review, conducted in the context of the transcripts as a whole. I return to the nature of this task in my analysis below.[50]Some behaviour is by its nature offensive to justice. It risks bringing the administration of justice into disrepute - but only if it is not marked with an appropriate and proportionate response from the Court. Public confidence in the administration of justice is protected by the Court’s response to such abuse: see Masood & others v. Zahoor & others (Practice Note) [2009] EWCA Civ 650; [2010] 1 WLR 746 at [71].[51]Whilst there is a power to strike out a claim in whole or in part on the basis that its continuation would involve or comprise an abuse of process, the Court’s response in each case depends on all the circumstances and should be both appropriate and proportionate. I prefer the word ‘response’ in this context to either ‘remedy’ or ‘sanction’. This avoids an unnecessary debate as to the distinction between punitive and deterrent elements. The Supreme Court has stated that the power to strike out “is not a power to punish but to protect the court’s process”: see Summers v. Fairclough Homes Ltd. [2012] UKSC 26; [2012] 1 WLR 2004 at [45].[52]Even if not containing a penal element, the Court’s response may involve a deterrent factor to help ensure compliance by others in future. This is commonplace in civil procedure whether or not a judicial response is described as a ‘remedy’ or ‘sanction’. One obvious example is where a party is found to have breached its duties as regards full and frank disclosure or fair presentation at a hearing conducted on a without notice basis. An appropriate and proportionate judicial response may be to refuse renewal or re-grant of an injunction which has been set aside. This does not depend on showing an abuse of process or unclean hands as a matter of equity.[53]Striking out a claim is a Draconian measure. It has been referred to as the response of last resort. Such comments need contextualising. In some instances, it is the very fact that a claim lies on the court file when it should not that justifies it being struck out. Examples include so-called Grovit abuse (where a claim is left stagnant at the choice of the claimant) or where a claim is started by the wrong party or without a genuine basis in an attempt to circumvent the expiry of a limitation period (e.g. Pickthall v. Hill Dickinson LLP [2009] EWCA 534; [2009] PNLR 31) or where a claim (or issue within it) involves abusive re-litigation or so-called Henderson abuse. Striking out meets the particular vice in these sorts of cases. They involve an abuse within the system, so to speak.[54]The position is different when dealing with extra-procedural abuse of the kind alleged in the present case and discussed above. Leaving aside situations where the impact of the abuse is to jeopardise a fair trial, the question of what constitutes an appropriate and proportionate response to such abuse is more open-textured, in my judgment. Those cases in which certain types of procedural abuse justify strike out as the natural response do not qualify the general proposition that striking out is a response of last resort. The search is always for the appropriate and proportionate way of dealing with an abuse.[55]One factor in the Court’s choice of response to a claimant’s abuse of process is the desirability of ensuring that a defendant guilty of serious wrongdoing (such as fraud) is held accountable according to the standards and procedures of our civil litigation system. A defendant who is the victim of an abuse of process is not necessarily let off the hook to enjoy the benefit of his own misdeeds. The Court must weigh procedural responsibility against substantive accountability to some extent: see RAKIA v. Azima [2021] EWCA Civ 349; [2021] 1 CLC 715 at [40]-[65] - in particular [62] & [63] (a post-trial situation where the defendant had been found liable in fraud).[56]Finally, I should note that neither side suggested the Court could not of its own motion strike out the claimants’ summary judgment application or exercise its undoubted discretion to refuse summary judgment as a response to the claimants’ abuse of process, if established.

Analysis

[57]It is helpful to summarise the triage of issues as I see them:(1) Does the claimants’ unethical behaviour involve or constitute an abuse of process?(2) What is the evidential status of the illicit information?(3) Depending on the answer to (2) above, is the claimants’ possession of illicit knowledge likely to obstruct the just disposal of these proceedings or otherwise create a substantial risk of an unfair trial?(4) If (1) or (3) above is shown, what is the appropriate and proportionate response of the Court?(5) In light of (4) above, are the claimants entitled to pursue their summary judgment application and, if so, should they be granted summary judgment or a conditional order?[58]I address these issues in turn below. There is a degree of overlap between them. (1). Does the claimants’ unethical behaviour involve or constitute an abuse of process?[59]In light of my findings set out above, the answer to this question is in the affirmative as regards actual or accrued abuse of process. I deal separately below with the forward-looking position.[60]As regards the accrued position, I am satisfied to the requisite standard that the claimants engaged in abusive conduct by seeking or attempting to obtain confidential information from their adversary’s litigation solicitor as occurred. This is so irrespective of the precise evidential status of any material obtained by such unethical process, including whether privilege in any information is on proper analysis precluded by the iniquity principle.[61]Put bluntly, this is something that should not happen and it cannot be countenanced by the Court. The use of unethical methods to target an adversary’s solicitor in the hope of extracting sensitive information or insights from them is anathema to the norms and values of civil litigation. It is cheating the system with a view to undermining the level playing field which the Court strives to maintain between opposing parties. It offends justice.[62]What took place in the present case is different in kind from the evidence-gathering techniques deployed by BC as discussed by Morgan J in Benkel v. East-West German Real Estate Holding & others [2021] EWHC 777 (Ch) at [140]-[161]. The lawyer targeted for a human intelligence by BC in that case, Mr Rese, was a transactional lawyer said to have assisted in creating sham legal structures which were the subject of the substantive proceedings brought by a trustee-in-bankruptcy. The fact that such evidence was admitted and relied upon by Morgan J does not set a precedent as to admissibility of any of the illicit information in the present case, but that is a matter for another day.[63]I am satisfied to the requisite standard that the claimants are legally responsible for and complicit in this unethical conduct (see paragraphs 21 to 25 above). They bought the product. They own the process. This is not a substantive legal analysis about the law of agency or doctrines of attribution or vicarious liability; cf. paragraph 24 above. It is a conclusion expressed pursuant to the Court’s inherent jurisdiction to regulate and protect the use of its own constitutional function.[64]The claimants’ abuse was compounded by their receipt of the illicit information, their review and retention of it as illicit knowledge, their new solicitors’ review and retention of it extraneous (and perhaps contrary) to any applicable procedural scheme or regulatory framework, and the uses made of such illicit knowledge to date as summarised in paragraph 34 above. The fact that these later steps were done on the basis of legal advice from their new solicitors, having satisfied themselves (correctly or otherwise) that any privilege was lost or precluded by iniquity, does not alter the essential characterisation of the claimants’ conduct. It may factor into the appropriate response of the Court, but it doesn’t change the fact that a serious transgression has occurred.[65]As regards the suggestion that any confidentiality was lost by X’s disclosure to BCO, I reject that submission. X was deceived from start to finish. He was lulled into a false sense of confidence and candour through unethical deception and manipulation. BC’s receipt or onward transmission of information could not destroy its confidential character. Nor on the face of things can it be said that X waived any privilege belonging to his clients by divulging what he did and how he did it during that sting operation. X had no authority to waive his clients’ privilege. The claimants’ contrary suggestions are unconscionable.[66]The fact that there should have been a nil return, to quote the claimants’ forensic mantra, does not alter this characterisation of their behaviour. It may be the case that X is guilty of serious professional misconduct, but only because of the deception and manipulation to which he was subjected by the claimants: see paragraph 28 above.[67]As regards the forward-looking position, including the second limb of the cross-application and any anticipatory abuse of process, this turns on the extent to which the illicit information is confidential and/or privileged: see Issue (2) below. Whilst the claimants can be restrained from making use of such information, and have given an interim undertaking to this effect pending resolution of the cross-applications, they cannot have their illicit knowledge erased or reversed. There is no way of policing its invidious or invisible influence upon their litigation or settlement strategy day in day out. (2). What is the evidential status of the illicit information?[68]The claimants launched a full-scale attack upon the confidentiality of any of the illicit information, as well as its privileged status including by reference to the iniquity principle. I have addressed some arguments at paragraph 65 above.[69]In the time allotted for this hearing, however, it has not been possible for me to undertake the granular task of ascertaining the answer to the bulk of this multi-layered inquiry. As to this task:(i) The material is substantial: see paragraph 26 above.(ii) It necessitates a ‘topic by topic’ analysis of the meeting transcripts, assessed in the context of the illicit information as a whole, in order to ascertain if the iniquity principle is engaged: see paragraph 49 above.(iii) The same approach may be required to understand whether any distinct piece of information is derived from or based upon matters in the public domain and what the appropriate nexus is in this context, including by reference to the prior or intervening manifestation of any litigation or settlement strategy revealed by X.(iv) I estimate that to be a 2-3 day hearing with appropriate pre-reading by the allocated judge. For ease of reference I refer to such further hearing as the “Information Review Hearing”.(v) This exercise could not have been undertaken as part of the present hearing. The estimate of 2.5 days was inadequate for such purposes. (3). Is the claimants’ possession of illicit knowledge likely to obstruct the just disposal of these proceedings or otherwise create a substantial risk to a fair trial?[70]Unlike the examination of accrued abuse of process under Issue(1) above, this depends upon the outcome of Issue(2) above.[71]It is appropriate to adjourn any application for injunctive relief, if properly made and unless the claimants are willing to extend their undertaking on suitable terms, to the Information Review Hearing.[72]The same applies to that part of the strike out application which depends on this forward-looking element and, therefore, the outcome of Issue (2) in future. I cannot tie the hands of the judge who deals with those matters, save in so far as my decision on Issue (4) in light of Issue (5) will inevitably form part of the circumstances in which or by reference to which that judge exercises their own broad discretion if satisfied that it arises following the outcome to Issue (3) itself.[73]The same should also apply, in my judgment, to the Astor Defendants’ alternative cross-application seeking to discharge the WFOs on the basis of the claimants’ abuse of process. The reasoning here is different:(i) Despite prolific citation of authorities providing only analogous or comparative guidance, none was identified in which a claimants’ subsequent abuse of process formed the basis of the Court’s decision to discharge an existing freezing order or any other injunction. This does not mean it cannot happen, including by loss of clean hands in equity.(ii) The WFOs were obtained prior to the claimants’ abuse of process and are not themselves the direct product of any benefit derived from the illicit knowledge. They nevertheless exert continuing pressure upon the defendants.(iii) Calver J refused to discharge the WFOs on 7 October 2024. The first unsolicited contact made by BC with X occurred just four days earlier, and the first (virtual) meeting took place on 10 October 2024. In one sense, therefore, the claimants secured a benefit in the form of Calver J’s Order which continued the WFOs against the Astor Defendants, together with a reasoned judgment containing observations and conclusions as summarised in paragraph 11 above.(iv) The existence of BC’s involvement and the illicit information was disclosed by the claimants through Mr Ford’s first witness statement made in support of the summary judgment application on 5 March 2025: see paragraph 32 above. The Astor Defendants’ appeal against the Order of Calver J was then pending. It was heard on 4 June. The Court of Appeal’s judgment was handed down on 28 July. No point about abuse of process or unclean hands was taken, or at any rate this feature of the case did not warrant a mention by the Court of Appeal in its judgment dismissing that appeal. This might be said to neutralise or reduce the impact of the claimants’ abuse upon their maintenance of the WFOs.(v) In so far as it is said to be contrary to conscience or involve a lack of clean hands on the part of the claimants to seek to maintain the strategic advantages of the WFOs despite their abusive conduct, there is some sense in this alternative cross-application being restored before Calver J, if available. The claimants sought to have their summary judgment application listed before that judge for reasons of familiarity and efficiency, although this rationale may now have lapsed.(vi) At any rate, the extent of the impact of the claimants’ abuse of process and (therefore) the extent to which its litigation conscience is sullied cannot be known until Issue (2) and then Issue (3) are determined at the Information Review Hearing.(vii) It is, therefore, just in all the circumstances to adjourn the alternative cross-application to that further hearing or its own consequentials.[74]Having dealt with aspects of the cross-application which can be adjourned or deferred to await the outcome of Issue (3), I now move to the important question of how the Court should deal with the claimants’ abuse of process in light of my findings under Issue (1). (4). What is the appropriate and proportionate response of the Court to the claimants’ abuse of its process?[75]In some ways this is the most difficult aspect to decide. It involves the exercise of a broad discretion in furtherance of the interests of justice and the overriding objective. It is common ground, as reflected in my formulation of this issue, that the Court’s response should be appropriate and proportionate.[76]The Astor Defendants have submitted forcefully that the only response that achieves these outcomes in the present case is to strike out or stay the claim in full. They say there is no lesser remedy (or sanction) available here. They point to cases where strike out is the usual or perhaps default solution for certain kinds of procedural abuse: see paragraph 53 above. They cite comparative case law where a claim or defence has been struck out for similar forms of abusive behaviour such as hacking or intruding.[77]There have been moments when I have felt that I ought to accede to this primary position. This reflects the gravity and culpability of the claimants’ behaviour, which I have characterised as an affront to justice and inimical to the fundamental norms and values of civil litigation in this jurisdiction.[78]I have nevertheless decided against striking out (or staying) this claim in all the circumstances:(i) The Court’s response must fit the abuse which has so far been established. As explained in Issue (1) above, that abuse is found in the unethical behaviour involved rather than the nature or quality of the illicit information - see Issue (2) - or the impact of illicit knowledge upon the claimants’ litigation conscience or consequent prospects of a fair trial: see Issue (3). Those are matters to be determined at a further hearing and may yet attract additional responses from the Court.(ii) Striking out (or staying) the entire claim would be disproportionate at this juncture in circumstances where there is a decent prospect of the claimants succeeding on their deceit claim at trial. There is a distinct policy in favour of exposing and remedying serious wrongdoing such as fraud: see paragraph 55 above.(iii) Come what may, the Astor Defendants’ own cross-applications necessitate a further hearing to deal with Issue (2)and Issue (3). My own review of material and initial analysis suggests that there are arguments either way on privilege and iniquity.(iv) I cannot ignore the independent responsibility and culpability of X. He revealed far more than a solicitor in his position needed to or should have done when seeking to impress the representative of a potential major new client. This in no way absolves the claimants for their own unethical and inimical behaviour. It does nevertheless feed into the balancing exercise at this stage of the analysis.(v) I am satisfied that there is a more proportionate response to the claimants’ abuse of process, namely forfeiture of their summary judgment application and payment of costs: see Issue (5) below.[79]In all the circumstances, I do not consider it appropriate and proportionate to strike out (or stay) the claim in its entirety at this stage. The fate of these proceedings awaits the outcome of the Information Review Hearing. (5). Are the claimants entitled to pursue their summary judgment application and, if so, should they be granted summary judgment or a conditional order?[80]As a matter of inherent jurisdiction and of my own motion, I strike out the summary judgment application. Alternatively, I would decline as a matter of discretion to enter summary judgment or make a conditional order even if the claimants had satisfied the elevated merits threshold and there was no other justification for proceeding to trial.[81]I make this decision without needing to decide whether the claimants’ abuse of process can itself constitute a compelling reason for trial (CPR 24.3(b)) notwithstanding satisfaction of the merits test in CPR 24.3(a). If I may paraphrase the reasoning in Arrow Nominees whilst avoiding any circularity, the claimants have forfeited any right they otherwise had to seek summary judgment in the present circumstances.[82]I am satisfied that this constitutes an appropriate and proportionate response to the claimants’ accrued abuse of process in circumstances where:(i) the summary judgment application was otherwise well made and might have succeeded based on the material I have seen, at any rate as regards proof of dishonest misrepresentations intended to induce the claimants;(ii) taking this approach deprives the claimants of any specific findings in their favour beyond and above those already made in an interlocutory context by Calver J and my own observations in paragraph 12 above;(iii) this may not be the only response of the Court in light of the potential prospective impact of the claimants’ abuse of process depending on the future outcome of Issue (3); and(iv) the claimants will be liable to pay the costs of the present hearing, which seems likely to be awarded on the indemnity basis (see below).

Disposal

[83]For the reasons given above:(i) The claimants have abused the process of the Court by engaging private investigators to obtain sensitive information from their opponent’s litigation solicitor through the use of unethical methods and practices. This is so irrespective of the precise evidential status of any part of the illicit information, including engagement of the iniquity principle.(ii) I am not persuaded that it would be appropriate and proportionate to strike out (or stay) this action in light of the claimants’ abusive conduct.(iii) I strike out the summary judgment application of my own motion and as a matter of inherent jurisdiction. Alternatively, if not struck out, I would decline to enter summary judgment or grant a conditional order as a matter of discretion even if the conditions for doing so were otherwise met.(iv) It goes without saying that the claimants are not at liberty to bring a new summary judgment application absent material change of circumstances and subject to anything said or directed by any other judge including the one allocated for the Information Review Hearing.(v) The inadequate time estimate for the present hearing does not enable me to undertake the granular analysis of ascertaining the evidential status of each distinct ‘topic’ or ‘unit’ of illicit information. This will need to be undertaken at the Information Review Hearing.(vi) I adjourn to the Information Review Hearing, or any hearing consequential upon it, the balance of the cross-applications which seek (a) directions as to the inadmissibility of or use that can be made of the illicit information, (b) discharge of the WFOs or (c) any application, if properly made, for injunctive relief restraining the claimants’ use of the illicit information or their illicit knowledge.(vii) My chosen response to the claimants’ abuse of process does not preclude a future judge from granting any remedy or imposing any sanction which they consider appropriate and proportionate in light of their own evaluation as to the impact of the claimants’ illicit knowledge (if any) upon the fair disposal of these proceedings or risk of an unfair trial.(viii) Subject to hearing full argument, if not agreed in the meantime, I foresee making an order that the claimants pay the costs of this hearing on the indemnity basis. An aggravating factor in this context is the claimants’ creation and protection of an evidential blackhole around the decision to target X as a source of sensitive intelligence resulting in their own illicit knowledge: see paragraph 19 to 25 above.[84]Despite the fact that my determination involves the contextual exercise of discretion, I will grant permission to appeal and cross-appeal.(i) The interplay between competing policies deserves appellate attention. Those policies underpin (a) the protection of the Court’s process against abuse or circumvention of litigation norms and values, (b) public confidence in the administration of justice generally and more specifically the work and output of the civil justice system, (c) the sanctity of legal professional privilege and its importance to the Rule of Law, (d) the prevention of serious wrongdoing, involving fraud or dishonesty at scale, and ensuring proper accountability for such wrongdoers, and (e) public confidence in the legal profession generally and especially when advising and representing those accused of such serious wrongdoing in the context of international fraud cases.(ii) In indicating my readiness to give permission in this way, I am not acknowledging that it would be legitimate to challenge my key findings as to the claimants’ conduct or its characterisation. They are essentially questions of fact with elements of evaluation. My concern, if anything, is that I may have been too lenient on the claimants in choice of response.(iii) It is a matter for the Court of Appeal, if its jurisdiction is engaged, as to whether it wishes to hear any appeal or cross-appeal prior to the outcome of the Information Review Hearing and determination of the balance of the cross-applications.[85]I am grateful to all counsel for their clear and helpful submissions both written and oral. A short remote consequentials hearing will be listed in the near future, subject to the availability of junior counsel. I will make directions for that hearing in the meantime so far as required.

Cited in 2 later judgments