England and Wales High Court (Chancery Division) Decisions

IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION

		Royal Courts of Justice
		17th June 2004

MR. JUSTICE LLOYD:

1. I have before me a number of applications in litigation which was commenced in February or March, which started with an application for a freezing order and a search order, made at the end of February on a without-notice basis and has been continued since then.
2. The case is one brought by three companies, in their own right, all of them in liquidation, and separately by their liquidators against (currently) one defendant, Mr. Hassan Ali Makki, who is alleged to have been, at the material times, the sole shareholder in each of the three companies and a shadow director of each of the three companies and essentially the person in control of those companies.
3. The claimants' case is that the defendant procured that each of the three companies should buy air time from BT and should sell it on and that, in essence, with the use of a smaller or larger number of intervening other entities, each company being substantially indebted to BT, someone collected in money in respect of the sale on of the air time. The claimants allege that that money, instead of being used to pay the debts of the companies - notably to BT - was syphoned off and put into bank accounts partly in the name of the defendant. This is said to have been in breach of the defendant's duties of skill and care and, above all, of his fiduciary duties to the companies. The causes of action relied on are fraudulent trading, under s.213 of the Insolvency Act; wrongful trading, under s.214 of that Act; breach of fiduciary duty and breaches of other duties; alternatively, unjust enrichment.
4. The defendant admits some of the facts but denies any wrongdoing and puts in issue a number of the facts, including saying that his connection with interest in and control over one of the companies (in particular, Globenet) ceased on a date in September 2003.
5. The claimants say that it is, however well dressed up, actually a simple and straightforward case of fraud. The defendant says that it is much more complicated than that: it is not fraud, it is a case in which there has been some unsuccessful trading, but not fraudulent trading, and it is denied that the funds which were transferred to the bank accounts in the Lebanon were funds belonging to any of the three claimant companies.
6. As I say, the proceedings started with an application which came before Mr. John Jarvis (sitting as a Deputy Judge of this division) on 26th February, who granted a freezing order and a search order. There was then a variation, I think, by Patten J. the following day, both of those being without notice. The matter came on on notice on 4th March, before Patten J. and the orders were continued. The particulars of claim are dated 17th March and the defence was served on 20th May. In the meantime, there were other steps being taken, including the examination of Mr. Makki under s.236 of the Insolvency Act.
7. Mr. Weisselberg, who appears for the claimants, says fairly and frankly that the claimants knew that, at the outset, money had gone to Lebanon and that they knew that they would have some difficulties in obtaining effective freezing orders in relation to money in bank accounts in Lebanon because of the particular position under Lebanese law. They hoped that, nevertheless, they would be able to obtain the return of funds from the Lebanese accounts, to accounts in this jurisdiction where freezing orders could effectively be applied. They were unsuccessful in that, not least (and perhaps particularly) because the relevant accounts, as I understand it, are joint accounts of the defendant and his father, and his father does not consent to repatriation of the money to this country, even though the defendant does and, indeed, has requested it.
8. Their inability to secure repatriation seems to have been apparent to the claimants by the middle of March. They then pursued the s.236 procedure, which was of some advantage to them but they concluded by early May that they were not going to be able to freeze the funds and they were not going to be able to do anything else to achieve the same result. Accordingly the first of the series of applications before me was made by an application notice issued on 11th May, the first application in which is for an order that the trial of these proceedings be expedited to the earliest date convenient to the court and related directions ordered, if not agreed. There is also, by that application notice, an application which is still relevant for the disclosure of documents relating to a particular company whose documents have not yet been disclosed to the claimants.
9. On 19th May, the claimants issued a further application notice, which raises two issues. One is whether two other companies should be joined as defendants, with associated orders in terms of service out of the jurisdiction and the manner of service; the other point is disclosure of sources of funding of the defendant's legal costs.
10. Counsel, Mr. Weisselberg, for the claimants, and Mr. Page, for the defendant, have very sensibly agreed that the first issue on which I should hear argument and should decide is the question of expedition because on the result of that depends what should sensibly be done about some of the other issues. Accordingly, I have heard that point argued, with commendable economy on each side, and I propose to decide that question first and then give the parties the opportunity consider what they wish to pursue in respect of the other issues.
11. The question of expedition is partly a question of principle and partly a question of practice. Any order for expedition involves a disturbance of the normal procedure of a case to be got to trial. It involves giving preference to one case in the allocation of court time over other cases; it also involves requiring the lawyers on both sides to give preference to the tasks of preparation of a trial for that case as over tasks of a similar nature in relation to the affairs of other clients.
12. Of course the court wishes, especially since the introduction of the Civil Procedure Rules, to bring all cases on as soon as they reasonably can be brought on. The resources of the courts are managed as best they can be, with a view to that, having regard to the overriding objective set out at the beginning of the Civil Procedure Rules. In any given case, detailed issues of timing will arise, some cases being the subject of a tighter and faster timetable, for practical reasons, than others, depending on their subject matter, the availability of witnesses and need for witnesses of a particular kind, problems with disclosure and so on and so forth.
13. Expedition is not a question of choosing a slightly faster over a slightly slower method of the proceeding to trial. Expedition involves an application and, if granted, an order that the case should proceed to trial on a seriously accelerated timetable and can only be justified on the basis of real, objectively viewed, urgency of the case, which justifies, first of all, giving preference in the allocation of court time to this case over the other cases in the court's list and, correspondingly, requiring the lawyers to drop everything else and devote their time to the expedited case.
14. Mr. Weisselberg submits that this case is appropriate to be expedited because it is truly urgent and it is one which is capable of being brought to trial on an expedited timetable. In order to meet a point taken against him, he says that the claim to expedition should not be regarded as forfeited by the fact that the application is made at this stage rather than right at the outset of the case.
15. He says it is truly urgent, and this is of course the first and fundamental question. The basis on which he says it is truly urgent is that he says there are large sums of money in bank accounts in Lebanon which the claimants claim belong to them or are repayable to them, on one basis or another, among the various causes of action pursued, and those are funds which cannot effectively be frozen by freezing order because, although such an order has been obtained against the defendant himself, the accounts are joint accounts with his father. His father, it appears clear, does have the ability to draw on at least some of those accounts himself without requiring a joint signature from his son and, accordingly, the father can withdraw moneys from these accounts; he has done, to some extent, albeit, I think it is right to say, before the grant of the freezing order; he may do again and that cannot be prevented by the obtaining of an order effective as against the bank with whom the account is held.
16. Accordingly, while there is no specific or direct evidence of a threat of dissipation, there is clearly a risk that money will be withdrawn from those accounts and become less - or perhaps one should say, even less - susceptible of recovery on the part of the claimants; whereas it is said that, once the claimants have a final judgment (assuming the claimants get a final judgment in their favour) in respect of these moneys against the defendant, not only will they be able to start the process of enforcement but they may also be able to get additional practical help from a body called the Money Laundering Commission in Lebanon, which is mentioned in the evidence. That is therefore the basis of the claim to urgency. It is a claim that the defendant has sent money to Lebanon which is essentially the money of one or other of the claimants and it cannot be frozen pending the outcome of the case and, therefore, it is said that it is more urgent than it would otherwise be to bring the case to trial.
17. I can see why it is the more urgent, from the claimants' point of view, to bring the case to trial, but I have to say that that is not the kind of urgency which I am accustomed to hearing adduced before the court as the ground for expedition. There are many cases which are brought against a defendant, whether resident in this jurisdiction or elsewhere, whose effectiveness depends on being able effectively to enforce without any pre-emptive remedy such as a freezing order. Of course there are many defendants as to whose ability to meet a judgment one has no particular doubt; even the most solvent of companies may turn out to be insolvent by the time of enforcement. But the mere fact that effective enforcement depends on getting a final judgment and, then, enforcing it and on the money being available (the defendant being worth enforcing against at that stage), is not what I generally think of as being a situation in which one case should be allowed to be brought before the court for trial at an earlier date than it otherwise would be.
18. As I say, Mr. Weisselberg sought to meet in advance the submission of Mr. Page, which Mr. Page in due course made, namely that this application should have been made when it was going to be made: right at the beginning of the case. Both counsel referred me to passages in the Commercial & Admiralty Courts Guide, which makes the point that an application for expedition should be made at the earliest possible opportunity.
19. This application has not been made at the earliest possible opportunity. I would not regard that by itself as a reason for not acceding to the application. It all depends, as it seems to me, on why the application is made at a later, rather than an earlier, stage. If the need for expedition is perceived only at a later stage, it may still be justifiable to put the accelerator on, so to speak, although some time has already elapsed in the life of the case. But it does seem to me there is some force in what Mr. Page says: that the claimants really should have chosen, at the outset, between pursuing their various interlocutory applications, including the s.236 application, all of which will have required a good deal of time and attention on the part of Mr. Makki and his lawyer, between attempting that, which was labelled, not unfairly, in the course of argument, a barrage of applications and, on the other hand, focusing, no doubt with some freezing and some search order at the outset, on accelerating the trial preparation.
20. Mr. Weisselberg submitted that, even if that was a point which could be made, it really depended on there being some prejudice to the defendant from the delay in making it. But I think that there is some prejudice, and again some force in what Mr. Page says, that if at the outset of a case of this kind, a party knows that the proceedings are going to be dealt with on an expedited basis, that may influence the composition of the legal team in a way which may or may not be more difficult to alter at a later stage, but certainly alteration at a later stage may involve additional, unnecessary expense, which is a respect in which there could be said to be prejudice to the defendant, resulting from the delay in making the application.
21. Mr. Weisselberg also submits that the case is not a complex one. Whether or not it is a complex one, I think, is not a question on which expedition, in principle, depends. It may well affect quite how rapidly the matter can be expedited but, it seems to me, if the case is suitable for expedition, in principle, then the court will direct an accelerated timetable; quite how accelerated it is will depend on the degree of complexity of the case and other practical considerations.
22. Viewing the matter of expedition or no, as a question of principle, rather than simply a question of choosing between one proposed timetable to trial and another, with or without minor changes, it seems to me that this is not a case in which I should order an ultra-speedy trial because it is not a case in which the urgency of getting the matter to trial justifies bringing the matter forward, ahead of other cases which are waiting for trial; nor imposing upon the defendant and his lawyers the obligation to give that much priority over other cases which will be involved.
23. I am not at all saying that, in that, I would be averse in principle to the idea of setting a timetable to trial and that I would be averse to the idea of making it a reasonably tight one. But I do not accept the proposition that the matter should be dealt with, to quote the application, by being "expedited to the earliest date convenient to the court", understanding by that, a forecast trial date in October or November.
24. It seems to me that the case for urgency is not made out and the case for expedition is not made out and there is, although it might not be decisive, the fact of delay in choosing to make the application, at any rate, does not help. So I will leave over, until other applications have been considered, the question of whether I should set a timetable to trial and, if so, what it should be.
25. On the question of expedition or no, I propose not to grant the relief sought by the claimants.

LATER:

26. Having refused to order an expedited trial, I am now asked to set a timetable to trial and this is, in part, agreed between the parties; in part, not.
27. The parties agree that the date for disclosure of documents, subject to an issue which is the subject of one of the remaining applications before me, should be the end of July and the date will not be 31st July (because that is a Saturday) but Friday 3 0th July.
28. There is an outstanding question of an application for further information of the defence, a request which is dated yesterday. The defendant proposes to answer that in two stages by giving, first of all, the information which he can, to the best of his ability, by reference to documents to which he has access and, that, he will do by 30th July. He says that the remainder of his answer will have to await disclosure, bearing in mind that relevant documents belong to the companies and, therefore, are in the possession of their liquidators, who are among the claimants.
29. The first issue of disagreement which I have to resolve is that as to the date for factual witness statements, for which Mr. Page proposes the end of October and Mr. Weisselberg proposes the beginning of October. It seems to me that there is a good deal to be said for the proposition that Mr. Makki's witness statement will need to be a substantial, detailed and extremely carefully prepared document and I think that the beginning of October is probably a bit tight but I propose to direct that the time for exchange of witness statements of fact should be Monday, 18th October; that should be the date by which the second stage of the further information is provided as well.
30. The next stage in the timetable is any supplemental witness statements provoked by reading the witness statements on the other side. I propose to allow four weeks for that, which takes us to Monday, 15th November.
31. Then there is a question about expert reports. It is agreed that each side should be allowed one expert in each of two fields. One is Lebanese law and there is no need for that to be dealt with otherwise than on an exchange basis. The other expert will be as to technical issues to do with telecommunications and Mr. Weisselberg submits that that should be sequential because the initiative will come really from the defendant's side.
32. Mr. Page proposes exchange by 21st December and if it were to be sequential, he would propose his report by 21st December but he is not in favour of sequential exchange. Mr. Weisselberg suggests the defendant's expert by 1st December and the claimants' by 17th January. It seems to me that there is a case for sequential service of this particular expert report.
33. The Lebanese law expert reports will be exchanged by 21st December; the technical expert reports: the defendant's to be served by Monday, 13th December and the claimants's by Monday, 17th January; experts in each discipline to meet and endeavour to agree a document setting out what they agree and what they do not agree on, by Monday, 31st January.
34. The trial is to come on not before 1st March. The estimate is necessarily very difficult at this stage. Mr. Page says, in practice, it is likely to be 15 days. It seems to me, at this stage, it should proceed on the basis that the estimate is ten to 15 days. There will have to be a pre-trial review anyway because of the length of the trial. If we have the experts to meet and to provide a report by 31st January, we should have a pre-trial review in that week. So PTR week beginning 31st January and at that stage there will be a better idea of how long the trial will be. As I say, trial not before 1st March, time estimate ten to 15 days.

LATER:

35. I now come to deal with the second of the applications in the claimants' application notice of 11th May, which is essentially for delivery up within seven days - but the time is not now pressed - OF all remaining documents relating to a company called Apple Telecom Europe Limited, including without limitation bank statements since 20th February 2004, copies of correspondence, documentation and agreements between ECT and Apple Telecom Europe Limited and (subject to legal professional privilege) all correspondence between Apple Telecom Europe Limited and a number of other parties. That is said to be pursuant to para.15 of the search order granted by Mr. Jarvis on 2 6th February.
36. Paragraph 15 of that order did indeed require Mr. Makki (the defendant) immediately to hand over to the applicant's solicitors, or to procure the delivery to them of any of the listed items which were in his possession or under his control, with certain exceptions and ancillary provisions. Listed items are set out in sch.B and, at para.8 of that schedule, one comes to any documents relating to Daltel USA LLC and any other entity that uses or trades under the name of Daltel.
37. It is common ground that Apple Telecom Europe Limited trades under the name of Daltel and, accordingly, on the face of it, documents relating to Apple Telecom Europe Limited are listed items and within the scope of para.15 of the search order. It was appreciated that, at the time of the execution of the search order, Apple Telecom Europe Limited did trade under the name Daltel and was therefore potentially within the scope of the order.
38. As I understand it, it is common ground that, in the course of execution of the search order, at any rate some documents of Apple Telecom Europe Limited were inspected but the documents were not delivered up wholesale and were not required to be delivered up wholesale. Copies of bank statements up to, I think, 20th February (which were then the most recent which were in existence) were supplied; whether then or thereafter, I know not and it matters not.
39. What is now said for the claimants is that, although they did not press for the delivery up of those documents at that time, they remain the subject of the order; there was no agreement that the order be varied so that they should not be ordered to be handed over; and that, accordingly, the claimants are now entitled to call for them to be handed over.
40. It is, I think, common ground that some such documents are likely to be within the scope of disclosure in the action and those will be disclosed pursuant to the order which I have already made: by the end of July. No point is taken now as to the timing of the special disclosure which is now sought; it is not sought to have accelerated delivery up of these documents. Essentially the only question is as to the scope of the documents which will be disclosable at that stage.
41. Mr. Weisselberg says that the scope of the documents is defined by the search order. Mr. Page that, because of what was said and done at the time of execution, the search order has been varied. So far as ordinary disclosure is concerned, Mr. Weisselberg says that his client liquidators are entitled to a wider range of disclosure than would necessarily be the case under the Civil Procedure Rules and it is for that reason important that a special order should be made. He presses me to make an order in the general terms of the search order or, alternatively, having regard to what is now said to be the importance of this particular company, to order (under the Civil Procedure Rules) disclosure of all documents which relate to the manner in which Apple has been traded by the defendant.
42. Mr. Page responds by saying that it would be sufficient for the claimants to have all documents which will be disclosable according to the ordinary principles of standard disclosure, together with (if and to the extent that it is wider) any other documents not otherwise disclosable which relate to the affairs of the claimant companies. Mr. Weisselberg refers to the procedures for disclosure under the Insolvency Act, and Mr. Page uses that formula as a convenient form of response.
43. I am not prepared to proceed on the basis that any binding variation of the search order was made, whether by formal agreement or by estoppel. Clearly Apple Telecom Europe is a connected company within the terms of para.8 of sch.B and clearly, accordingly, documents relating to it are listed items and could have been required to be handed over under para.15 of the order. It may very well have been extremely sensible and prudent and practical that they were not required to be handed over. The fact is they were not, and we are now more than three months on and the question is what should be ordered at this stage?
44. I do not take this to be simply a question of looking at the search order, seeing that it has not been complied with and ordering that it be complied with. Any question of disclosure seems to me at this stage to be something which has to be considered in the context of the stage which the action has reached. It is in the light of that sort of consideration that, at least implicitly, for example, Mr. Weisselberg does not ask for the order to be enforced strictly by requiring the immediate handing over of these documents. As Mr. Page submitted, the point of a search order and the orders for delivery up of documents is because there is perceived to be a risk that documents would otherwise be destroyed; it is not simply a question of giving advance disclosure.
45. Given that the exercise of disclosure is coming up as more or less the next stage in the preparation of the case for trial and will be given by 30th July, pursuant to the order I made this morning, the only question is as to the scope of disclosure, which in any event will, at least in part, be governed by the principles of standard disclosure under the rules, as to which I need say no more. So it comes to being a question as to whether I should enlarge that scope of disclosure by using Mr. Page's formula of documents which relate to the affairs of the claimant companies or Mr. Weisselberg's formula of documents which relate to the manner in which Apple has been traded by the defendant.
46. What is said to be the relevance of the trading of Apple arises from what is said to be the, in effect, intermingling of trading as between Apple and other companies. It seems to me that if that is right, then it may very well be that quite a wide range of Apple's documents relate to the affairs of the claimant companies, or one or more of them, but it seems to me that if there are documents which relate to the manner in which Apple has been traded by the defendant but do not relate to the affairs of the claimant companies then such an order for disclosure at this stage would be too wide. Accordingly, the order I propose to make is that the documents to be disclosed by the defendant by 30th July will include documents of, or relating to, Apple Telecom Europe Limited, not only those covered by the ordinary principles of standard disclosure, but also any such documents which relate to the affairs of any one or more of the claimant companies.
47. In that respect, therefore, I accept the submissions of Mr. Page.

LATER:

48. I come now to one of the applications in the application notice of 19th May which, in terms, is for an order that the defendant disclose to the claimants' solicitors the identities of individual companies or other entities who have contributed or, to the best of his knowledge, will contribute to his ordinary living expenses and/or his legal expenses and costs of representation pursuant to para.22 of the freezing order of 26th February (as amended) and the nature of the funding arrangements with any such entities.
49. The basis of that is said, in the application notice, to be that the defendant is in breach of the terms of the freezing order and should be required to disclose such information to alleviate the potential prejudice caused by way of his nondisclosure. The main substantive provision is an order that he must not remove from England and Wales any of his assets in England and Wales, up to a value of £6m, or in any way dispose of, deal with or diminish the value of any of his assets whether they are in or outside England and Wales, up to the same value. That is subject to a number of exceptions; the relevant exception is in para.22, which is as follows:

"This order does not prohibit the respondent from spending £1,000 a week towards his ordinary living expenses and also £20,000 on legal advice and representation but, before spending any money, the respondent must tell the applicant's legal representatives where the money is to come from and he must not spend any company assets."

"Company assets" has a special definition relating to funds alleged to have been derived from the claimant companies. There is the usual provision that the spending limits can be increased but the agreement must be in writing. No doubt that has been done.

50. The information provided is that Mr. Makki has obtained funding of both his living expenses and his legal expenses. As regards his living expenses, I think I am right in saying that what he has said is that funding has come from his father. As regards legal expenses, three entities have been identified, one of whom is Apple Telecom Europe Limited. There is a fourth, unnamed, third party and that third party the defendant has refused to identify.
51. Mr. Weisselberg makes his application, in the first place, on the basis that para.22 of the order requires the defendant to identify the source of any funds which are used to pay his legal bills, that is based on the second part of the paragraph which I have read. I disagree.
52. It seems to me that, in a situation which is said to be the present situation where a third party pays direct to Mr. Makki's solicitors an amount towards bills, the respondent is not spending his own money and, in my judgment, the order only requires him to tell the claimants' legal representatives where the money is to come from if it is his own money which is spending. I say "his own money" - of course he is prohibited from spending company assets. Company assets relates to money which no doubt, if he is right, is in fact his money. Leaving that aside, in my judgment, the proper construction of that paragraph of the order does not require him to identify to the claimants' lawyers the source of the money if it is not his own money which is being spent, i.e. if it is coming from a third party and not coming via an account of his, the order does not apply, it does not require the third party to be identified.
53. The second of the alternative bases of Mr. Weisselberg's application is that the court has jurisdiction to require the third party funder to be identified pursuant in effect to the jurisdiction ancillary to s.51 of the Supreme Court Act and he has cited to me the decision of Peter Smith J. on 30th October last year in a case called Zakharov v. White. That was a different case; it was concerned with a freezing order but it was also concerned with an application for permission to spend money which was not subject to the freezing order, towards fees in a situation in which there was also some third party funding. The defendant had not been frank in the course of, and in relation to, a particular application as regards third party funding, about the fact that money was about to come in and that he was about to receive a large bill for fees in respect of work already done. That led the judge in that case to require the defendant to disclose, both for the past and for the future, the information sought as regards the source of the money which had been used (and would be used in future) to discharge legal fees, including all documents setting out all arrangements as to the basis of the funding. That information was ordered to be supplied, although it was also on the basis of an undertaking required of the claimants that the information was not to be used for the purpose of an application under s.51 to make the funder liable for the claimants' costs, what the judge refers to as a late s.51 application, which I take to mean an application based only on the fact that the funding had been provided.
54. I do not propose to cast the slightest doubt on the appropriateness of that order having been made in the particular circumstances of that case. It demonstrates that there is jurisdiction to make such an order for the past and for the future, a matter which has at some points been in debate in the past. So far as the present case is concerned, it does not seem to me that there is any justification for making such an order. It is true that the freezing order protection obtained by the claimants is of limited value, for reasons mentioned in the first of the judgments I have given today, but there is a freezing order against the defendant and it is effective against him and it is not least of significance because it has a potential effect on his solicitors, who, being within the jurisdiction, are of course fully subject to the order; unlike the Lebanese banks.
55. It seems to me that, both because the order itself does not require disclosure and because an order which did require such disclosure would be an exceptional order to be made, the circumstances of the present case do not justify going that far; whereas the conduct of the defendant in the Zakharov case seems very clearly to have invited the making of such an order
56. For that reason, I do not propose to accede to this application on Mr. Weisselberg's part.

LATER:

57. The fourth application I have to consider on the 19th May application notice is for permission to join two additional defendants to the proceedings and to serve the proceedings on them out of the jurisdiction. They are Weybridge Management LLC and Daltel USA LLC, both, I think, incorporated in Delaware. Mr. Weisselberg makes that application, Mr. Page is instructed only for Mr. Makki. Daltel USA is Mr. Makki's company, but it is a separate entity. Weybridge, I think, was Mr. Makki's company for a time; it is said not to be so now.
58. In relation to each company, I need to consider whether to allow it to be added as a defendant, and whether to order service on it out of the jurisdiction. Of course if I do make such an order and the proceedings are then served on each of these companies, it is open to each of them then to apply to set aside the permission to serve out of the jurisdiction.
59. Mr. Page has made some helpful submissions, from the point of view of Mr. Makki, expressing concern about a number of aspects of the matter. The basis for this application is Mr. Sion Richards' third witness statement, of 19th May, in which he describes what is said to be the connection between the companies who are already involved and Weybridge and Daltel USA, as well as other entities.
60. The application is not supported by draft particulars of claim, which is perhaps unfortunate but is explicable on the basis that the claimants were hoping for an order for an expedited trial which, if they had got, would have been effectively inconsistent with joining in these additional companies and, therefore, their focus was on the first rather than the alternative application.
61. The nature of the claim which would be made is indicated in Mr. Richards' witness statement. There is a sufficiently arguable claim in debt against Weybridge, as to which no particular issue arises. There is also said to be a claim in knowing assistance against Weybridge. Mr. Page has drawn my attention to some factors which might defeat that or might suggest that it is not a promising claim.
62. It seems to me that, for present purposes - and without saying more than I have to, because there may be a further stage of this battle if Weybridge applies to set aside the service on it - there is a sufficiently arguable claim which is described in Mr. Richards' witness statement and that, accordingly, I should regard this as a proper claim to be added to the proceedings and a claim in respect of which it would be proper to give permission to serve out of the jurisdiction under pt.6 of the Civil Procedure Rules, either as regards knowing assistance on the basis that it is all bound up with the existing claim and Weybridge is a necessary or proper party to the existing claim which has already been served on the first defendant within the jurisdiction, or, so far as the contract for the debt claim, it is a contract governed by English law which has been broken in this jurisdiction.
63. Accordingly, I accede to the application in respect of Weybridge, both as to joinder and as regard service out of the jurisdiction. The claimant intends to serve on Weybridge's registered office in Delaware and see what happens.
64. So far as Daltel USA is concerned, there is no debt or other contract claim. Mr. Weisselberg describes the claims against that company as knowing receipt, knowing assistance or restitution and he indicates, on the basis of Mr. Richards' witness statement, the general basis of those alternative claims.
65. Mr. Page has suggested that there may be a number of problems in the way of that, but again it seems to me that these are claims which are reasonably arguable and in relation to which it would be appropriate to permit the defendant to be added to the proceedings and the proceedings to be served on that defendant out of the jurisdiction. As I understand it, it is accepted on behalf of the existing defendant that if I regard this as a proper case for Daltel USA to be served under the jurisdiction, Messrs. Irwin Mitchell, who act for the defendant, will in fact accept service and, accordingly, I do not need to make an order for an alternative method of service
66. In that respect, I accede to the claimants' application and will so order.