7.1 APPEAL – REHEARING

In McFaddens Solicitors v Guru Paran Chandrasekaran – Lawtel 26.2.07 the appellant appealed against the decision of a judge allowing the appeal of the respondent firm of solicitors against an order refusing summary judgment in the respondent's claim in respect of outstanding costs and disbursements against the appellant.

The appellant contended that the judge had erred in failing to confine himself to a review of the master's decision but instead conducting a re-hearing of the summary judgment application, contrary to the requirements of an appeal pursuant to CPR r.52.11. The Court of Appeal held that the judge had conducted a review within the meaning of CPR r.52.11 rather than a re-hearing.

CPR 52.11(1) provides: Every appeal will be limited to a review of the decision of the lower court unless –

(a) a practice direction makes different provision for a particular category of appeal; or

(b) the court considers that in the circumstances of an individual appeal it would be in the interests of justice to hold a re-hearing. It was relevant that it had never been suggested that the judge could properly determine the appeal by any narrower enquiry.

7.2 COMPROMISE OF DISPUTE

In Thakrar and others v Jackson and others – Butterworths Law Direct 23.2.07 there was long running litigation between the parties. The defending parties maintained that there had been an exchange of correspondence that had given rise to a binding compromise of the proceedings. The claiming parties disputed this, and two of the defending parties applied for a declaration that the proceedings had been compromised. The court held that its approach to any alleged compromise should borrow from the pragmatic approach to contract formation advanced in previous authority. That approach could not be taken too far; where, for whatever reason, a binding compromise had not been reached, it was wholly illegitimate for the court to try and fill in the gaps in order to achieve a result that the parties themselves could not be taken to have intended. In all the circumstances, there had been no binding compromise of the present proceedings.

7.3 DERIVATIVES CLAIM – CPR 19

In Craig Reeves v (1) Peter Allen Sprecher (2) Bina Sanghvi (3) Platinum Capital Management Ltd (4) Platinum Trading Management Ltd – Lawtel 12.2.07 the parties had set up two companies in which they were both shareholders. One company had been incorporated in the Caribbean island of Nevis, the other in England. The applicant brought the instant proceedings seeking an injunction restraining the first respondent from taking further steps to dilute the applicant's shareholding interests. The applicant also brought claims against all the respondents alleging breach of contract, tortious inducement of breach of contract and related conspiracies.

It was held that the features of the instant case were not sufficient to displace the normal situation that the courts of the place of incorporation were the appropriate forum in which matters relating to the internal management of a company, including the bringing of derivative actions, should be determined. Permission for the applicant to continue his derivative claims was therefore refused, as was permission to amend his pleadings to claim an injunction restraining the respondent from applying the company's assets other than in the ordinary course of business.

7.4 ENFORCEMENT

In Banco Nacional De Comercio Exterior Snc v Empresa De Telecomunicaciones De Cuba SA – Lawtel 7.2.07 the applicant Mexican bank applied for the continuation of a worldwide freezing order in respect of the assets of the respondent Cuban state-controlled telecommunications company. Proceedings resulted in an Italian court ordering the respondent to pay damages to the applicant on the basis that a Cuban decree did not constitute an event of force majeure because of the Cuban government's control of the respondent. The judgment was registered in England pursuant to Regulation 44/2001 and a domestic freezing order made to preserve the assets of the respondent that were situated in England in the form of monies owed to it. On an application by the applicant, a worldwide freezing order was imposed.

The question was whether the court had jurisdiction to make a worldwide freezing order or whether the provisional or protective measures available under Article 47 of the Regulation had to be confined to domestic measures.

The Commercial Court held that Article 47 provided an unrestricted and discrete code for the granting of provisional or protective measures in the context of enforcement. There was no basis for restricting those measures to the freezing or disclosure of domestic assets. It was open to the court to make an order other than in respect of assets in England or outside the EU. The relief was directed at the respondent rather than at the assets. It had none of the comity implications of being tantamount to interference with the jurisdiction of a foreign court as were involved in anti-suit injunctions. On the contrary, in the context of post-judgment protective measures, such an order was intended to safeguard the recognition and enforcement of the foreign court's judgment. The applicant had established a real risk of dissipation. All the circumstances supported the continuation of the worldwide order.

7.5 EXPERT’S REPORT

In Andrew Carruthers v (1) MP Fireworks Ltd (2) Balfour Convenience Stores Ltd - Lawtel 6.2.07 Bristol County Court held that a district judge had been entitled to exercise his discretion to grant permission to rely on an expert's report subject to the disclosure of an earlier report by another expert that had been obtained before the action had commenced It held that the disclosure of an earlier report could always be made a condition of permission to rely on a later report by the same or another expert if fairness and justice required it; but if no such permission was sought, the court did not have any power to override the privilege in the earlier report. It also held that there was no relevant distinction between unidentified experts' reports obtained before an action had been started and those obtained with the court's permission after it had started.

7.6 FREEZING ORDER – NON-DISCLOSURE

In Amedeo Hotels Ltd Partnership and others v Zaman and others – Butterworths Law Direct 22.2.07 a worldwide freezing order was discharged due to non-disclosure, but reimposed (in terms to be the subject of further argument) on the grounds that the claimants had a strong case and that the ultimate owner of the disputed property might be the state of Brunei, which was bringing proceedings against the claimant It was found on the facts, that there was not likely to have been any intention on the part of the claimants to omit or withhold information which they were advised was material or to misrepresent the true position regarding the individual claims. There was one instance in which the fourth claimant had failed to disclose his true interest, which was significant, but full disclosure of what should have been revealed would probably not have had a material effect on the decision of the court to grant the order.

7.7 PERMISSION TO APPEAL

In 7E Communications Ltd v Vertex Antennentechnik Gmbh – Lawtel 26.2.07 the county court judge had refused permission to appeal and said that any appeal should be made to the Court of Appeal.

The Court of Appeal held that, having refused permission to appeal, the county court judge had no jurisdiction to say where an appeal was to be heard, because until permission to appeal was obtained by the appellant there was and could be no appeal. Since the judge had refused permission to appeal, he had no power to make a direction under CPR r.52.14 that the appeal be transferred to the Court of Appeal. The judge in the High Court had been wrong to hold that r.52.14 applied both to appeals for which permission had been obtained and those for which it had not. The rule itself clearly distinguished between an appeal and an application for permission to appeal. It was only the appeal that could be transferred to the Court of Appeal. Once the county court judge had refused permission to appeal the only court that could give permission to appeal was the High Court.

7.8 PRE-ACTION DISCLOSURE

In Total E&P Soudan SA v (1) Philippe Henri Edmonds (2) Andrew Stuart Groves (3) White Nile Ltd - Lawtel 31.1.07, previously reported in the June 2006 bulletin, the respondent asserted that the appellants had unlawfully interfered with his economic interests or induced breach of contract, and obtained pre-action disclosure of 11 classes of documents. In exercising his discretion to grant pre-action disclosure, the judge took account of the fact that documents in categories 1 to 10 had been referred to in a listing circular and some had been made available for inspection by the public.

The questions before the Court of Appeal were whether the judge had jurisdiction under CPR r.31.16(3)(d) - ie whether disclosure would assist in saving costs, resolving issues or otherwise disposing of the case; and whether the respondent’s case had reasonable prospects of success which involved consideration of whether the potential claim was justiciable in the English court.

It held that as far as category 1-10 documents were concerned, they would enable the respondent to plead a more focused case. In what was potentially a large and complex claim it was obviously preferable from the point of view of both parties to have a properly pleaded case from the outset. Therefore, disclosure of the documents in advance of proceedings was desirable in order to dispose fairly of any future proceedings within r.31.16(3)(d)(i) of the Rules. The judge did have jurisdiction to make the order.

The Court of Appeal also held, generally, that when considering an application under CPR r.31.16, the court did not need to and should not embark upon a consideration of difficult legal issues such as justiciability and the mental element required to establish the economic torts that the respondent relied upon. Such applications were in the nature of case management decisions requiring the judge to take a broad view of the merits of the potential claim, but not necessitating an investigation of legally complex and debatable potential defences or grounds for stay. The situation would be different if a respondent could show beyond argument that a claim was hopeless or non-justiciable, or if disclosure of the documents themselves raised non-justiciable issues such as sovereign confidentiality. That was not the case here. For the same reasons, the court should not consider arguments about appropriate forum on an application for pre-action disclosure.

The application concerning category 11 documents, which was defined in broad terms and related to documents which might not be disclosable by way of standard disclosure was dismissed.