Wahdwani v (1) Ingenious Media Holdings Ltd (2) Ingenious Media Ltd (3) O’Brien [2018] EWHC 350 (QB)

The claimant brought a claim alleging that he had sustained psychiatric illness due to suffering from extreme stress during the course of his employment. His employment came to an end in 2009 and he had previously been involved in proceedings where the second defendant, his employer, was also a party to the claim.

The previous proceedings against the second defendant were settled by way of a Tomlin order in 2011. The order had a clause providing:

This Settlement Agreement is in full and final settlement of all claims of any kind, known and unknown, which the Parties have or may have against each other and whether referred to in the litigation hereby compromised or otherwise”.

The second defendant applied for the current claim to be struck out on the basis of the terms of the Tomlin Order.

The claimant opposed the application on the basis that the Tomlin Order did not preclude this further claim and that he had lacked capacity at the time of entering the settlement agreement.

At the application hearing, the second defendant’s application was successful and the claim was struck out.

The claimant appealed against the decision striking out their claim against the second defendant.

On appeal

The High Court held that the claimant was bound by the terms of the Tomlin order. The terms were clear and it could not be said that the parties did not have in mind the potential for there to be a personal injury claim when reaching the compromise.

The High Court noted that the claimant had been complaining in 2010 about matters which were the subject of the instant claim.

In respect of the claimant’s alleged lack of capacity, the claimant’s expert had merely concluded that he could have been suffering from hypomania in 2011 and may have lacked capacity to make decisions about litigation. However, this prognosis did not, on the balance of probabilities, establish that the claimant lacked capacity for the purposes of the Mental Capacity Act 2005.

The High Court concluded that there was no evidence that the medical evidence could not have been obtained if reasonable diligence had been used prior to the application hearing before the master.

In any event, if the medical evidence had been available at the application hearing it was held that this would not have affected the master’s decision to strike out the current claim against the second defendant.

The claimant’s appeal was dismissed.

What this means for you

This case shows the importance of carefully setting out the terms of any settlement reached and making sure that clauses in a Tomlin order are fully understood, are sufficiently clear and properly convey the terms of the agreement reached between the parties.

In this case, the clauses in the Tomlin order were noted to be extremely clear. Also the clauses specifically provided that “… all claims of any kind known or unknown, which the parties had or might have…” were settled by the terms of the agreement, which included any potential personal injury claims.

Tomlin orders offer flexibility because the parties can create a bespoke agreement that is tailored to their particular legal and commercial circumstances, which may go beyond what the court could have ordered. It should be noted that Tomlin orders can include provisions which relate to matters outside the scope of the current dispute and can include, as in this case, clauses to prevent any of the parties bringing future claims, of any kind, against any other party to the agreement.