Case No: C02UB930
IN THE COUNTY COURT
Oxford, OX1 1TL.
Date: Friday 27th April 2018
HER HONOUR JUDGE CLARKE
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HUGHES JARVIS LIMITED & NEIL JARVIS
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MISS C. TOMAN and MR. E. GRANGER (instructed by Norton Connor, Solicitors) for the Claimant
MR. O. HYAMS for the Defendant
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HER HONOUR JUDGE CLARKE:
1. This is an application before me, which I knew was coming and which of course the Claimant and his legal representatives knew was coming, to strike out the Claimant’s claim and the Third Party Mr. Jarvis’s defence to counterclaim pursuant to CPR 3.4(2) and/or pursuant to this court’s inherent jurisdiction by reason of the contempts of court found against Mr Jarvis yesterday. The application which is now made by Miss Toman who represents both Mr. Jarvis, the Third Party and the Claimant, is that I do not consider this application now but I consider it later, on an adjourned date. She submits that, firstly, normally her clients should have three days notice of such an application for strike out and this application was only formulated overnight and issued this morning; secondly that it would be unfair to hear the application today because the consequences, potentially, if it is successful are extremely serious for both the Claimant and Mr. Jarvis; thirdly that Mr Jarvis should be permitted the opportunity to file written evidence in response; fourthly that she, Ms Toman, has had insufficient time to prepare and to marshal her arguments or produce a skeleton and that she has also had insufficient time to obtain instructions from her clients about the matter; and fifthly that Ms Toman considers that Mr Jarvis having spent the night remanded in custody in prison has been in no fit state this morning to give instructions and make decisions about this case and in fact has spent most of the morning discussing with his separate representation, Mr. Granger, the issues relating to his committal for contempt.
2. Mr. Hyams for the Defendant submits there is no reason why this application should not be heard today; the lack of notice is because of the unusual circumstances which have given rise to the application; there is no need for further evidence as we were all in court yesterday and witness to the facts which gave rise to the application; that counsel for the Third Party has had ample time to prepare since two o’clock yesterday afternoon since she knew and was warned that this application was coming. He asks that I abridge time for notice and list this at two o’clock so that Ms Toman and her client can have additional time to receive and give instructions respectively, and prepare for the application to be heard at that time.
3. I am with the Defendant. The reason for the short notice is entirely within Mr. Jarvis’s hands. If he had not carried out the actions which caused him to be found to be in contempt yesterday, this application on the third day of a three day trial would not be necessary. It is necessary to hear it promptly as we are part way through a trial, and in fact part way through Mr Jarvis’s evidence. I abridge time for notice accordingly. The issues that I will need to decide to deterimine this application are whether it is possible to for a fair trial of the claim and/or the counterclaim to continue, either in whole or a part. I do not consider that any further witness evidence is required to determine this application, it is a matter of legal submission. The witness evidence which was filed with the Defendant’s application was, as I have already said, witness evidence which was necessary to support the application but in fact it gives no evidence of fact in the knowledge of the solicitor to the Defendant which was not already known to the court, the Third Party, the Claimant and Ms Toman, their counsel, as it refers only to facts which all arose in open court yesterday.
4. In terms of whether an adjournment is necessary or desirable, I bear in mind that Mr Jarvis is still in purdah and Ms Toman has not finished her re-examination. If I do find the trial can be saved, we may be able to finish his evidence today. Conversely, by adjourning this now I would either be requiring Mr Jarvis to maintain purdah through a long adjournment of days or weeks, which is entirely unrealistic, or accepting that he will be re-examined after the adjournment if the application is not successful, which would not be fair to the Defendant.
5. In terms of sufficiency of time to prepare, Miss Toman takes the somewhat startling position that now, at 11.30, if she was given until two o’clock to prepare she will not get any further forward in preparation. I think she should try. I have every confidence in her ability to read several Court of Appeal authorities and distil from them the relevant legal points that she wishes to put before the court. Whether or not she has time or is able to produce a skeleton is up to her; I will not require her to do so. She could have done so during the course of yesterday evening. I certainly was reading authorities and thinking about this yesterday evening because I knew this application was coming. Mr. Hyams produced a very helpful and detailed skeleton yesterday evening which sets out the issues which Miss Toman will have to address for her client. The additional time will enable Mr Jarvis to collect himself and give his instructions. For that reason I will adjourn this until two o’clock and hear it then.
(For continuation of the proceedings please see separate transcript)
6. This is the application that I referred to in my earlier judgment to strike out the claim made by the Claimant, Hughes Jarvis Limited, and the defence to the Defendant’s counterclaim, that defence being lodged by the Claimant and the Third Party, Mr. Jarvis, himself. It arises, I am not going to rehearse, from the unusual circumstances of discovering two things. Firstly, that during the course of Mr. Jarvis’s cross-examination, while he was in purdah overnight, despite being warned not to communicate with any third party including his legal advisers save to identify a single plan, he did in fact send numerous emails to both his solicitors and his counsel overnight. I don’t know what the contents of those emails are. Ms Toman informed me of the emails she had received first thing in the morning, having obtained instructions from her client to do so. I considered what to do and stated that I would deal with this issue after we finished hearing Mr Jarvis’s oral evidence. His cross-examination continued for the rest of the morning and finished late morning. The second discovery was made during his response to the first question put to Mr Jarvis in re-examination by Ms Toman shortly before lunch. She asked why he had changed his evidence on a point in cross-examination that morning from the evidence he had given on the same point in cross-examination the day before. That related to the likely financial consequences for Mr Jarvis personally and the claimant if he was ultimately unsuccessful in the trial. The previous day he had said that the claimant would likely not become insolvent, and that morning he said he had reconsidered and he thought the claimant would become insolvent. In answer, Mr. Jarvis volunteered that he had spoken to Mr. O’Neill of Lime Court to discuss his evidence. Lime Court is one of the funders of the property development being undertaken by the claimant, with which this case is intimately connected. Mr Jarvis specifically volunteered that he wanted to ‘clarify the evidence’ that he had given the previous day, and that his conversation with Mr O’Neill was what caused him to change the evidence that he had given the previous day.
7. Mr Jarvis also explained under oath that he had sent documents to both his counsel and solicitor relating to the dimensions of the rooms of Flat B and Flat E which were offered as suitable alternative accommodation in these proceedings and specifically offered that the evidence that he had given the previous day about the dimensions of Flat B, which he had given orally because he had no documentary evidence in support, was wrong. He said he sent those emails and documents, again, to ‘clarify his evidence’.
8. I found him guilty of three counts of contempt: seeking to communicate with his counsel via email the night before last, seeking to communicate with his solicitor by email the night before last and speaking to Mr. O’Neill by telephone about the proceedings yesterday morning, each being a breach of a specific oral order, made explained and repeated to him by me, that he must not communicate with his legal advisors or discuss any evidence he had given or was going to give with anybody until his evidence was complete. I have adjourned sentencing for contempt until after this application has been determined.
9. I have had the benefit of extremely helpful skeleton arguments from both counsel and I thank them very much. They have had to deal with this in very short order. I have given Miss Toman the opportunity to have some additional time to deal with it until two o’clock, but she assured me that she could deal with it and take proper instructions et cetera by twelve o’clock and so that is how we have proceeded, and I thank her for managing to get together the authorities she wishes to rely on.
10. The Applicant Defendant submits that I should strike out the claim and I should strike out the defence to counterclaim, because:
i) it is impossible for the court to understand which of the evidence that Mr Jarvis gave in cross-examination yesterday was evidence which was tainted from his conversation with Mr. O’Neill and which was not;
ii) Mr. Jarvis’s actions in speaking to Mr. O’Neill in breach of a specific and explicit and repeated order from the court not to speak to anybody while he was in the course of giving his evidence must go directly and adversely to the court’s view of Mr Jarvis’s credibility and his honesty and his trustworthiness;
iii) the court has the right, (and this is common ground) to strike out a claim in circumstances where the Claimant is guilty of conduct which puts the fairness of the trial in jeopardy (per notes to the White Book);
iv) the fairness of the trial is in jeopardy in this case because there is no way that the court can properly understand and assess the evidence that has been put forward by Mr. Jarvis for himself and for the Claimant.
11. Mr Hyams for the Defendant relies on an Employment Appeal Tribunal case of Chidzoy v. The British Broadcasting Corporation UKEAT/0097/17/BA (2018) in which the EAT upheld the decision of the first instance to strike out a claim when the Claimant was found to have discussed the case and her evidence with a journalist during a break in proceedings, having been warned multiple times not to discuss the case with anyone whilst giving evidence. The tribunal found that Ms Chidzoy had been guilty of unreasonable conduct, that the tribunal had irretrievably lost trust in the claimant and that it was no longer possible to have a fair hearing in respect of her claim. The issues identified by HHJ Jennifer Eady QC as applicable to an EAT claim are found in para. 23 and I paraphrase them as follows:
i) the court must conclude not simply that a party has behaved unreasonably but that the proceedings have been conducted unreasonably;
ii) the court must go on to consider whether a fair trial is still possible, albeit there can be circumstances where a finding of unreasonable conduct can lead straight to strike out. That might be where there has been wilful, deliberate or contumelious disobedience of an order or where the conduct in issue is so serious it would be an affront to the court to permit the party in question to continue to prosecute their case. In this case, both counsel submit that it is for this court to consider whether there are other things which can be done, for example other case management decisions which can be taken or other remedies which can be imposed, to show the court’s disapproval of the relevant actions if by doing so it can be possible to conduct a fair trial.
iii) Even if a fair trial is not considered possible, the court must consider whether strike out is appropriate or whether some other lesser remedy might be more proportionate. In this case I must have in mind any punishment which may be given in the committal proceedings which will follow the determination of this application. In addition, I must consider what the consequences would be of any strike out of the defence and the claim and the effects of that on all the parties to the case to determine whether in all the circumstances that is the right and just thing to do
iv) Even if strike out is appropriate the court should consider the consequences of the order, for example whether it is appropriate to allow the party to participate in a remedies hearing.
12. I accept, as Ms Toman submits and as Mr Hyams accepts, that Chidzoy is not directly binding on me because it relates to different procedural rules which apply in the Employment Tribunal and not the CPR. However the guidance it gives about the issues to be considered I find useful and applicable to a claim such as this one. Mr. Hyams submits that it is also useful because of the similarity of the facts of both cases; that also involved a case of a witness speaking to somebody else during the course of her evidence and the trial stopping halfway through. I accept, however, Miss Toman’s submission that Chidzoy can be distinguished from this case, because in Chidzoy there were particular issues arising from the behaviour of the Claimant’s counsel. I have already made it very clear earlier today that I make no criticism whatsoever of Miss Toman who has acted as far as I can see entirely professionally, nor do I make any criticism of her instructing solicitors. As I say, Miss Toman has acted entirely properly in balancing her professional obligations to the court and to her clients and she has certainly done absolutely everything that she could do or could say for them.
13. Miss Toman relies on Fairclough Homes v Summers  UKSC 26 in which the Supreme Court considered whether a civil court has power to strike out a statement of case as an abuse of process after a trial at which the defendant had been ordered to pay the claimant damages. Lord Clarke giving the judgment of the court held at para. 33 that it had that power pursuant to CPR 3.4(2) but that it should only do so in “very exceptional circumstances”. The facts of the case were that it was found after the claimant had succeeded in his claim for personal injury at trial, that CCTV images existed which made clear that his claim was grossly and fraudulently exaggerated. Ms Toman relies on it as authority for what I think is a very clear well-understood and not disputed proposition that a strike out is always a draconian measure and always a measure of last resort (para 49). Miss Toman relies in particular on Lord Clarke’s discussion at para 51 – 60 about other actions short of strike out that can be taken by the court, including penalising poor behaviour in costs, taking proceedings for contempt, et cetera. However Lord Clarke makes clear: at para 35(v) that the court has jurisdiction to strike out a claim or any severable part of it of its own volition whether immediately before or during the trial although the occasion to exercise the jurisdiction at the start of trial is likely to be very rare (approving Colman J. in in National Westminster Bank v Rabobank Nederland  EWHC 2959 (Comm); at para 61 that the test in every case must be what is just and proportionate; and at para 62, as a postscript, that “nothing in this judgment affects the correct approach in a case where an application is made to strike out a statement of case in whole or in part at an early stage.” I distinguish this case on its facts from that of Fairclough v Summers because the strike out in that case was after the trial and the trial has not concluded here, we have not even completely concluded the evidence of the first witness.
14. I have also been taken by Ms Toman to Masood v. Zahoor (2010) 1 WLR, a decision of the Court of Appeal in 2009, and in that Mummery L.J. handed down the judgment of the court (composed of Mummery, Dyson and Jacob L.J.J). This was a case where there was significant misconduct and some of the claims were based on forged documents and false evidence. Mummery L.J. held that the question of a fair trial is a central factor in considering whether to strike out such a claim, but is not the only material factor. At paragraph 71 Mummery L.J. said: “In our judgment this decision is authority for the proposition that where a Claimant is guilty of misconduct in relation to proceedings which is so serious that it would be an affront to the court to permit him to continue to prosecute his claim then the claim may be struck out for that reason. In the Arrow Nominees case the misconduct lay in the Petitioner’s persistent and flagrant fraud whose object was to frustrate a fair trial. The question whether it is appropriate to strike out a claim on this ground will depend on the particular circumstances of the case.” That was approved by the Supreme Court in Fairclough v Summers.
15. It is Mr. Hyams’ submission that Mr Jarvis is guilty of misconduct which is so serious it would be an affront to the court to permit the claimants to prosecute their claim/defend the counter claim, and so the principle identified by Mummary L.J., he submits, is fully engaged by the behaviour of Mr. Jarvis in this case.
16. Turning to submissions made by Miss Toman for the Claimant and Mr. Jarvis, she makes the point that strike out is draconian. I entirely accept that. Authority for that principle can be found not only in Fairclough v. Summers but from a long line of cases. She submits that the trial has started the court should only strike out a claim or defence to counterclaim if a fair trial is not possible or otherwise in exceptional circumstances. Miss Toman submits that a fair trial is still possible and she does so for a number of reasons. First of all, she submits that the two contempts I have found in relation to Mr. Jarvis sending emails to the solicitors and to her as counsel have not affected the fairness of the trial, since neither counsel nor solicitors have read those emails and they have also not been shown to the court to protect whatever privilege they undoubtedly have. I agree that if those contempts were all we were dealing with, the trial could have continued. That is why when I found out about the emails to counsel I allowed the trial to continue, and the cross-examination of Mr. Jarvis to continue, because I did not consider that the mere fact of sending emails which were not read and which were immediately returned once received by Ms Toman had affected the fairness of the trial. Of course, the issue of whether it was a contempt that required punishment, or whether it could have simply been purged by an apology, was still left open, and that is why, at that point, I adjourned all consideration of that point until after the trial was finished.
17. Secondly, Ms Toman submits that a fair trial is also still possible, despite the finding of contempt relating to Mr. Jarvis speaking to Sean O’Neill of Lime Court Finance, as the court may simply disregard the relevant parts of Mr. Jarvis’s evidence which have been tainted by that conversation. I do not consider that I can. First of all, I accept Mr. Hyams submission that the court cannot be entirely satisfied that it knows the full extent of the conversations with Mr. O’Neill, what was said, how many conversations there were and who instigated them and therefore how it can properly identify the evidence which has been tainted and which has not. He makes the fair point that if the mere fact of Mr. Jarvis speaking to Mr. O’Neill about the proceedings in order to, as Mr Jarvis put it, ‘clarify the evidence’ he gave the day before adversely affects my view of him as a credible and honest witness, which it does, and if my view of his reliability is also affected because by speaking to Mr. O’Neill he sought to change the evidence he had given the day before, then how can I accept his evidence about the extent and the content of that conversation?
18. Thirdly, Miss Toman submits that any conversation that Mr Jarvis had with Mr. O’Neill of Lime Court Finance could be effectively ring fenced, and the court could simply disregard all the evidence that Mr Jarvis gave about Lime Court Finance. However, on Mr Jarvis’s own evidence, his conversations with Mr. O’Neill touched on much wider issues relating to the financing and the solvency of the claimant company, the personal financial circumstances of Mr. Jarvis, the various options that Lime Court Finance were considering and might take if these proceedings were ultimately unsuccessful and what effect that would have on Mr. Jarvis personally and on the claimant company. That is what Mr. Jarvis told me, and in my mind that does significantly taint the evidence given on a number of issues in the case, not simply the issue of the position of Lime Court Finance itself.
19. Mr. Hyams in his skeleton argument also reminds me of concerns that became apparent in Mr. Jarvis’s cross-examination the day before yesterday before these contempts occurred, when he accepted in cross-examination that the accounts of the claimant which he filed at Companies House and relied on as evidence in the trial were not, in fact, accurate accounts. In my judgment, that is one of the areas in which it is entirely possible that the evidence that he gave may have been infected by his view of the position of Lime Court Finance, because those were accounts which had been provided to Lime Court and other finance companies in order to carrying out the financing of the development. It illustrates the difficulties that face me should I try to identify and cut the infected elements of Mr Jarvis’s evidence.
20. Fourthly, Miss Toman submits that Mr. Jarvis’s evidence is, in fact, of very little relevance to the counterclaim and so I can disregard it entirely and still determine the counterclaim. In relation to the claim, to the extent that I am not satisfied that I can ring fence any tainted evidence, she submits that I can draw adverse inferences against Mr Jarvis’s credibility and reliability and be cautious of accepting any of his evidence except where it is supported by contemporaneous documentation. She submits that since his evidence is of limited relevance on the counterclaim, I should allow the trial to continue and permit her to cross-examine Mr. Searle and test his evidence.
21. Mr. Hyams describes Ms Toman’s submission that Mr Jarvis’s evidence was of very little relevance to the counterclaim, as ‘unusual’. He reminds me that the counterclaim is supported to a significant extent by the single joint expert, and that the claimant and Mr Jarvis simply put Mr. Searle to proof of it, so it is difficult to understand how Mr Jarvis’s evidence is not important now. I accept that submission. Mr Jarvis’s evidence would be important and is relevant, but as the tribunal in Chidzoy found, I cannot trust it given Mr Jarvis’s flagrant disregard of my repeated orders not to discuss his evidence with anybody else, particularly given his statement that he spoke to Mr Neill in order to clarify the evidence he had given the day before, and did change his evidence in cross-examination as a result of that conversation. For those reasons I am satisfied of the first limb in Chidzoy, namely that Mr Jarvis has conducted the proceedings unreasonably.
22. Turning to the second limb – is it possible for there to be a fair trial? I have set out the difficulties in trying to excise the infected evidence from other evidence given by Mr Jarvis and I am satisfied I could not do so in a way that would enable a fair trial. What would be the effect if I was to refuse the strike out application and allow the trial to continue, but make the adverse inference that I must inevitably, in the circumstances, make against Mr. Jarvis, namely that I cannot trust his evidence as either credible or reliable? It became clear during his cross-examination that there is no documentary evidence in support of his key evidence about the suitability of the proposed alternative accommodation, in particular details of the room sizes, garden, and parking. In any event, he appeared to resile during the course of yesterday morning from some of that key evidence that he had given the day before. In those circumstances it seems that the claim must inevitably fail. Accordingly the only purpose in refusing the strike out of the claim and the counterclaim, therefore, would be to preserve the right of Mr. Jarvis to have his counsel cross-examine Mr. Searle in order to try and undermine his case on the counterclaim. Is that a fair trial? It is not, in my judgment, it is merely trying to salvage whatever can be salvaged from the damage caused by Mr Jarvis’s actions, for the benefit of Mr Jarvis and the claimant. The second issue which is highlighted by Masood v. Zahoor is whether, in fact, despite the misconduct the court should try and prevent the further waste of precious resources. Because of Mr Jarvis’s conduct we have now wasted an entire day of a three day trial and there is no way in the time remaining, which is half a day, that we could get through cross-examination of the defendant and his two witnesses, it is not possible. This would have to come back for at least another day, and possibly a day and a half. In my judgment the fairness of the trial has been materially jeopardised by Mr Jarvis’s actions.
23. I remind myself that strike out is draconian and a last resort. I have considered Miss Toman’s submission, found at the end of her skeleton argument, relating to the evidence that Mr. Jarvis has given about the potentially disastrous consequences for the claimant company and for him personally in the event that these proceedings are not successful. She submits that those consequences are such that it would not be just and proportionate to strike out the claim and the defence to counterclaim. My difficulties with this submission are three-fold. First, the evidence I have heard is confused and contradictory and has changed during the course of Mr Jarvis’s cross-examination, the start of his re-examination and what he has said afterwards. Second, this evidence is, in my judgment, tainted by his conversation with Mr. O’Neill yesterday. Third, the consequences may well be disastrous for the company and for Mr. Jarvis personally - I cannot know if they are or not - but if they are, they are entirely of Mr. Jarvis’s own making.
24. I remind myself, per Masood v. Zahoor, that the fairness of the trial is a central factor but not the only one: where a claimant is guilty of extremely serious misconduct, as I am satisfied Mr Jarvis is in this case, I may strike out the claim and counterclaim if it would be an affront to the court to permit him to continue. I have considered this carefully and I am satisfied that it would be an affront to the court to permit the claim and counterclaim to continue when, in my judgment, the purpose of Mr Jarvis in speaking to Mr. O’Neill was in effect to jeopardise the fairness of the trial because it was to seek, as he put it himself in re-examination, to clarify and change the evidence that he had given the day before. That was, in my judgment, an attempt to strengthen his and the claimant’s position to the detriment and prejudice of the defendant.
25. I have considered whether there are any other options available to me which would provide a just and proportionate response to the misconduct, but I do not see that there really is anything else available to me. Miss Toman has not suggested that I should consider as an option dealing with the contempts in committal proceedings and ordering a fresh trial of the claim and counterclaim before another judge, but for completeness I will. I do not consider that would be a just and proportionate response as it would simply give Mr. Jarvis a second bite of the cherry, as it were, another chance to try and get his evidence in order now that he has seen the weaknesses of the claim exposed at trial. That would be unfair to the defendant.
26. The suggestion that an award of costs or contempt proceedings can deal with the matter, as I have already said, does not deal with the issue of unfairness of the trial and it certainly would not make an unfair trial fair. I will deal with the contempt with the outcome of this application in mind, and no doubt I will hear about costs, but when it comes to consideration of the strike out it my conclusions are that the claim and the defence to counterclaim must be struck out because a fair trial is no longer possible and in order to mark the court’s very serious concern about the affront to the administration of justice that Mr. Jarvis’s conduct has caused.
27. For those reasons I accede to the defendant’s application to strike out the claim and the defence to counterclaim. The parties agree that that means that the Mr Jarvis as the third party and the claimant cannot dispute any aspect of the defendant’s counterclaim for damages, although they can make submissions about the appropriateness of the remedies which are sought.
This transcript has been approved by the Judge.