England and Wales High Court (Chancery Division) Decisions

IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
COMPANIES COURT

		Royal Courts of Justice Strand, London WC2A 2LL
		22 September 2011

Thursday, 22 September, 2011

APPROVED JUDGMENT

HIS HONOUR JUDGE HODGE QC:

1. This is my extemporary judgment in the matter of two petitions for unfair prejudice presented under s.994 (contained within Part 30) of the Companies Act 2006: petitions number 11578 of 2008 and 20858 of 2009. This extemporary judgment is a sequel to, and should be read in conjunction with, the judgment I delivered at the end of the 12-day trial of these petitions on Friday 29 July 2011. The neutral citation number of the approved transcript of that judgment is [2011] EWHC 2186 (Ch). At the end of that trial (at which I had heard oral evidence) I ordered that there should be judgment for Mr Attwood (the sole petitioner on the petition in relation to Annacott Holdings Limited); and I ordered that the petition presented by Mr Maidment (the first respondent to the Annacott petition) in relation to Tobian Properties Limited should be dismissed. By paragraph 3 of my order, I directed that the issue of what relief Mr Attwood might be entitled to on the Annacott petition should be adjourned to a further hearing, to be fixed. By paragraph 4 of my order I also directed that all issues regarding costs should be adjourned to a further hearing, to be fixed. This is the further hearing envisaged by paragraphs 3 and 4 of my order of 29 July.
2. In addition, there are two application notices before this court. The first is an application notice issued by Mr Attwood on 7 September 2011 seeking an interim payment of £1 million in respect of the buy-out order which he envisages is to be made in relation to his 50% shareholding in Annacott. That application is expressed to be made under either s.996 of the Companies Act 2006, or CPR 25.7(1)(c). The second application notice is one issued by Mr Maidment on 16 September 2011 seeking directions as to expert evidence from property and share valuation experts in relation to the quantification of the amount to be paid for Mr Attwood's 50% shareholding in Annacott.
3. The evidence in support of those two applications is contained in the following witness statements: Mr Attwood's third witness statement of 7 September, together with exhibits AA1-4; the seventh witness statement of Mr Geoffrey Maidment of 14 September 2011, together with exhibit GM7; the fourth witness statement of Mr Attwood dated 16 September 2011, together with exhibit AA5; and the seventh and eighth witness statements of Mr Iain Halliwell Mackie, a partner in the firm of Macfarlanes, Mr Maidment's solicitors, respectively dated 16 and 19 September, together with exhibit IHM8. That evidence, together with my order of 29 July and the approved transcript of my judgment delivered orally on that day, is contained within a supplemental bundle prepared for the purposes of this hearing. That bundle also contains certain inter partes correspondence, and an email exchange between counsel and me. I have had the benefit of being able to pre-read in its entirety the contents of that supplemental bundle. Prior to this hearing I had also received written skeleton submissions from counsel for the parties, both dated 20 September, from Mr Andrew Clutterbuck of counsel (who appears for Mr Attwood), and from Mr Thomas Grant of counsel leading Mr James Sheehan (who appear for Mr Maidment).
4. In this extemporary judgment, since it is now approximately 3.50 on the afternoon of the one day set aside for this further hearing, I do not propose to rehearse in detail the written submissions. The documents themselves contain a sufficient record of those submissions. I emphasise that I have borne all that is written within them in mind. I have also borne in mind the oral submissions presented to the court during the course of this morning. Mr Clutterbuck addressed me for about an hour and ten minutes. Mr Grant then responded for about 20 minutes before the short adjournment and for an hour and a quarter after lunch. I then indicated my provisional views with a view to curtailing the need for Mr Clutterbuck to respond on all matters addressed by Mr Grant orally before me. In the event, Mr Clutterbuck found it necessary to respond on only one point, namely my provisional view as to the appropriate date for valuation purposes in connection with the share buy-out order. I have borne those additional submissions, directed to what he considered might have been a misapprehension as to the facts on my part, in mind.
5. In this extemporary judgment I propose to consider, first of all, the relief to be granted on the Annacott petition. I then propose to consider the question whether there is jurisdiction to order an interim payment on the hearing of a s.994 petition in advance of the making of any share buy-out order, and, if so, whether it is appropriate to order such an interim payment, and, if so, in what amount. I will then address the issue of directions and further expert evidence. Finally, I will address the issue of the incidence of costs and the basis for their assessment, both in relation to Mr Maidment, and also in relation to his sister, Miss Sarah Jane Maidment (who was the second respondent to the Annacott petition because she holds one, out of a total of 5,000, issued shares in that company).

1. Issues of relief.

6. It is not in dispute that there should be a share buy-out order, pursuant to which Mr Maidment will be required to purchase Mr Attwood's 50 percent shareholding in Annacott. The issue between the parties is as to the basis upon which that share buy-out order should proceed. On that issue, Mr Attwood's submissions are to be found at paragraphs 3-33 of Mr Clutterbuck's written submissions. Mr Maidment's submissions are to be found at paragraphs 7-32 of Mr Grant's written skeleton submissions.
7. In paragraph 194 of my substantive judgment, having found that Annacott's affairs had been conducted in a manner unfairly prejudicial to Mr Attwood, and that he was entitled to relief on his petition, I indicated my provisional view to be that the simplest and most proportionate approach to relief might be to order a buy-out by Mr Maidment of Mr Attwood's 50 percent shareholding on the basis of a valuation of Annacott on a particular date pre-dating the property transfers and/or on particular valuation assumptions to be specified; although I indicated that I would hear further submissions as to that.
8. Mr Grant, for Mr Maidment, accepts that a buy-out order would be the appropriate and proportionate form of relief, and that the court should give a direction to that effect. He further supports my preliminary indication that the appropriate valuation date for a buy-out order should be a particular date pre-dating the transfer of the properties. Since the first property was transferred to Mr Maidment in October 2005, he suggests that that would be the most appropriate date. Indeed, he goes on to submit that no other valuation date would provide a workable, or fair, basis on which to proceed. In support of that submission, he refers me to the decision of the Court of Appeal in the case of Profinance Trust SA v Gladstone [2001] EWCA Civ 1031, reported at [2002] 1 WLR 1024. I was taken to that case. In particular, I was taken to the conclusion of Robert Walker LJ, delivering the judgment of the Court of Appeal, at paragraphs 60 and 61.
9. Mr Clutterbuck submits that the aim of any order made on the hearing of Mr Attwood's unfair prejudice position should be to compensate Mr Attwood for the unfair prejudice that the court has found that he has suffered. He submits that, had it not been for Mr Maidment's unfairly prejudicial actions, Mr Attwood would now be the 50 percent owner of an investment company, owning 46 London residential properties with considerable equity, and one which would have enjoyed several years of low interest rates on its borrowings and thereby would have almost certainly made profits out of its rent roll. Moreover, he says that Annacott would not have suffered from Mr Maidment's misappropriation of company monies. He submits that the relief should fairly compensate Mr Attwood for what has occurred, although he acknowledges that that should be tempered by consideration of the overriding objective, including the costs and time which may be involved in working out, and effecting, appropriate relief. Acknowledging the terms of paragraph 194 of my judgment, Mr Clutterbuck submits that Mr Attwood's concern with the historic valuation approach is that it may, depending on the adjustments to be made, fail to recognise the significant capital appreciation in Annacott's property portfolio, resulting from the price increases in the London property market since the transfers of properties formerly comprised within Annacott's portfolio began to be made to Mr Maidment, at his instigation, from about the middle of October 2005. Mr Clutterbuck submits that a historic valuation may therefore leave Mr Maidment with the benefit of that capital appreciation, being a benefit which he has misappropriated from Annacott. That approach may also, he says, fail to recognise the profits which, given the low interest rates in recent years, have almost certainly accrued to Mr Maidment from property rentals. In any case, he submits that the relief granted to Mr Attwood should reflect the unresolved dispute regarding such profit, and should include appropriate directions, such as disclosure, to enable that dispute to be resolved. He makes three proposals for structuring the relief on the basis of a valuation of Annacott. In order of preference, Mr Clutterbuck's first proposal is that the relief should be structured directly to counter what Mr Maidment principally did wrong, i.e. transferring the properties to himself. Mr Clutterbuck submits that, if that had not been done, Annacott would now own the properties. The relief to be awarded by the court should reflect that; and Mr Maidment should be ordered to purchase Mr Attwood's shares at a price equal to 50 percent of such valuation. The second approach is that Annacott should be valued as it is now, but with the benefit of the value of the claims it has against Mr Maidment; and he should be ordered to purchase Mr Attwood's shares at a price equal to 50 percent of such valuation. The third proposal, which is Mr Clutterbuck's least preferred course, is this court's provisional suggestion that Annacott be valued as at 1 October 2005, but on the footing that Mr Maidment should also be required to pay Mr Attwood a sum to reflect interest. Mr Clutterbuck relies upon the Profinance decision as indicating that the court has jurisdiction to order quasi interest in an appropriate case. He suggests a simple interest rate of 8 percent would be appropriate. On that approach, Mr Maidment should be ordered to purchase Mr Attwood's shares at a price equal to 50 percent of the valuation, and to pay a sum equivalent to interest on that sum from 1 October 2005 to the date of payment.
10. In his oral submissions, Mr Clutterbuck emphasised that the aim of a buy-out order is to remedy the unfair prejudice found by the court. He acknowledges that whether the company in question is a going concern is a relevant consideration; but here he points out that, although the company is inactive, it has, or should have had, assets. He submits that a historic valuation approach would be unfair where the original underlying assets of the company, which have been unfairly appropriated by Mr Maidment, have markedly appreciated in value. He emphasises that Annacott was always intended as an investment company, and that Mr Maidment has made profits from rental receipts. There is a dispute as to that. Mr Clutterbuck makes the point that although, in his latest evidence (at paragraph 17), Mr Maidment asserts that, when repayments on the mortgages and the costs of managing the properties are taken into account, the rental income is not high enough for him to earn a profit on the properties, Mr Maidment does not condescend to any degree of detail. Mr Clutterbuck submits that the court should not allow itself to be tempted by considerations of practicality to depart from the underlying principle of fairness. He makes the point that there will have to be a further hearing in any event with expert valuation evidence, and that any valuer is likely to have difficulty, as Mr Costa, the single joint expert who gave evidence at trial, did, in undertaking a historic valuation of properties relating back to October 2005.
11. It seems to me that I have to temper the relief to be granted in this case to the specific facts of the case. Although it was cited to me by Mr Clutterbuck on the issue of whether there should be a discount against the 50 percent shareholding held by Mr Attwood in Annacott, it does seem to me that the observations of His Honour Judge Purle QC, sitting as a Judge of the High Court at the Royal Courts of Justice in the case of Sunrise Radio Limited [2009] EWHC 2893 (Ch), bear repetition. The courts should, as Judge Purle said at paragraph 305, make "the most suitable order to suit the facts of the particular case before it. The Court must do what is fair". There is no inflexible rule applicable to all cases. Although I did so in the context of the Tobian petition, at paragraph 150 of the approved transcript of my earlier judgment I made the point that, in the present case, relevant factors included the fact that, effectively from the acquisition of the first transfer of shares in Tobian in the year 2000, Mr Attwood had carried on the business of Tobian until it entered into creditors' voluntary liquidation whilst Mr Maidment had carried on the business of Annacott. In his reply, Mr Clutterbuck reminded me that this was not a case where Mr Attwood had simply walked away from Annacott, and had sat upon his rights as a 50 percent shareholder in that company. This had been done effectively by agreement between himself and Mr Maidment. I bear that in mind. Nevertheless, it does seem to me, here, that the position was that, as from about the year 2000, by agreement (by conduct, if not expressly) on the part of both Mr Attwood and Mr Maidment, each of them had effectively assumed responsibility for their respective companies: in the case of Mr Attwood, Tobian; and in the case of Mr Maidment, Annacott. Annacott was a company that had effectively been funded throughout by Mr Maidment and his financial standing, although, until about the year 2000, Mr Attwood had played an important part in identifying properties for Annacott to purchase. Nevertheless, as from the year 2000 it was Mr Maidment, with the assistance, first, of his sister, Miss Maidment, and then of his partner, Miss Hastings, who had effectively managed the property and affairs of Annacott, with Mr Attwood assuming responsibility for the estate agency business of Tobian. During the course of 2002 and 2003 there had been correspondence between the parties and their solicitors with a view to a separation of the ways between the two individuals and their respective companies. That had come to nothing, according to Mr Attwood because he had simply lacked the funds to take matters forward. The reality, however, is that Mr Attwood had done nothing from the end of 2003 to realise his investment in Annacott. That position only changed with the failure, and insolvency, of Tobian. In the course of my judgment, I found that the reason why Mr Attwood had presented the petition in relation to Annacott at the time that he did was because Tobian was no longer in existence as a solvent company with assets. Its material assets had all been transferred to a new company owned by Mr Attwood and Miss Heard, Epyc.
12. Effectively, it seems to me that the share ownership of Annacott should have been addressed by Mr Attwood and Mr Maidment no later than some time immediately after the end of 2003. Instead, it was not until October 2005 that Mr Maidment embarked upon a process of transferring Annacott's assets to himself. Mr Attwood had done nothing to address the position in relation to either company because, for whatever reason, it had simply suited him to leave matters as they were, so as not effectively to rock the boat in relation to the company of which he was the 75 percent shareholder, Tobian. In October 2005, as I have found, Mr Maidment embarked upon a process of transferring Annacott's assets to himself. He should not have done that. What he should have done is to have either reached an accommodation with Mr Attwood, or, if he could not do so, taken steps to liquidate Annacott.
13. In his seventh witness statement (at paragraph 26), Mr Maidment seeks to make one further point in relation to the fact that he continues to own the 46 properties that were the subject of the Annacott petition. He says that, had he not acquired the properties himself, he would nevertheless have taken steps to cause Annacott to sell them to third parties. He says that, as he had explained in his evidence at trial, he did not regard Annacott's business model, which was increasingly reliant upon his ability to finance the management of its portfolio singlehandedly, as a viable business model in the long term. Mr Clutterbuck submits that I should treat that assertion with a considerable element of scepticism and reserve, and that I should not accept it. Whether or not that is right, it seems to me that, objectively, what should have happened is that steps should have been taken by Mr Maidment to address the fact that 46 properties were owned by a company in which he had only a 50 percent shareholding. But it seems to me that it would be over-compensating Mr Attwood, and unfairly penalising Mr Maidment for his conduct in transferring the properties to himself, for me simply to proceed to a valuation of Annacott on the footing that it had retained those 46 properties. The fact is that Mr Maidment had transferred them to himself. What he should have done is either, as I say, to have reached agreement with Mr Attwood, or, if he could not do so, to have taken steps to secure the liquidation of Annacott. That should have been done, at the latest, by the time that Mr Maidment started to transfer the properties to himself. It would be penalising Mr Maidment for his unfair conduct unduly harshly if I were to ignore the transfers and proceed as though Annacott still retained the properties. The most appropriate way of addressing Mr Maidment's conduct, as it seems to me, is to take a valuation of Annacott on the basis of the state of affairs that pertained immediately before Mr Maidment began the transfer of the properties to himself. On that basis, the valuation date should be 1 October 2005, unless there have been any third party transfer of properties after that date. But if I do that, it seems to me only fair that Mr Attwood should also be awarded the equivalent of interest on the amount applicable to the value of his shares as at 1 October 2005.
14. I am satisfied, on the basis of the Profinance decision, that I have jurisdiction to make such an award of interest. I am satisfied, in all the circumstances of the present case, and in the exercise of my discretion, that it is appropriate for me to make such an award of interest.
15. Mr Grant, for Mr Maidment, has taken me to the Court of Appeal's observations in the judgment of Robert Walker LJ at paragraphs 31 and 32 of the Profinance case. It does seem to me that the Profinance case is distinguishable in two respects. First, that was a company which was still a going concern, unlike Annacott in the present case; and, secondly, Robert Walker LJ's observations at paragraph 32 were directed to a situation of a petitioner seeking an order for the purchase of his shares on the basis of a valuation at a relatively early date, but then augmented by the equivalent of interest. Mr Attwood's primary position was that the shares should have been valued as at the date of the hearing, and not at an earlier date. It is, therefore, understandable that he did not seek to put in evidence as to an appropriate rate of interest when he was not primarily seeking a buy-out order as at a date earlier than the hearing. Nevertheless, it does seem to me that there is force in Mr Grant's point that I should not simply attempt to pluck a rate of interest out of the air. I have considered whether I should proceed by reference to the rate of interest from time to time on short term investment account, or by reference to base rates from time to time augmented by 1 or 2 percent. But since there has to be a further hearing in any event, it seems to me it would be more appropriate for both parties to be allowed to adduce evidence on the appropriate rate of interest. Certainly it seems to me that to adopt Mr Clutterbuck's rate of 8 percent per annum, bearing in mind actual interest rates since October 2005, might be unduly harsh to Mr Maidment.
16. So I will simply reserve the issue of interest, having made it clear that, in principle, interest should attach to the appropriate buy-out price for Mr Attwood's shares.
17. Mr Grant, in his written skeleton submissions at paragraphs 27 and 28, raises the question whether, although Mr Attwood owned 50 percent of the shares in Annacott, his shareholding should, nevertheless, on a buy-out basis, be subjected to a discount to reflect the fact that, as Mr Maidment was the director of Annacott and Mr Attwood was not, Mr Attwood had no control, and, therefore, a discount should apply to the pro rata value of his 50 percent shareholding. Mr Grant submits that that should, ultimately, be a matter for expert evidence; and that the court's decision as to whether such a discount should be applied can only properly be made once expert evidence has been adduced. At paragraph 28, he raised certain further points tending to suggest that such a discount would be appropriate; and he elaborated upon those in his oral submissions before me. He drew attention, in the course of his submissions, to the observations of Arden LJ in the case of Strahan v Wilcock [2006] EWCA (Civ) 13, [2006] 2 BCLC 555, and to earlier observations of Peter Gibson J in the case of Re a Company ex parte Harries [1989] BCLC 383 at pages 398G-399C. He submitted that if the market would impose a discount, the court should reflect that in its order. He submitted that the court should not pre-empt the expert from applying reality, and that the court should not prejudge the issue in advance of consideration of expert evidence as to share valuation.
18. I reject that submission. It seems to me that it is not a matter for expert evidence as to market practice. Here, the thrust of both the unfair prejudice I have found on the part of Mr Maidment, and the court's remedial order for a buy-out on the basis of values as of October 2005, is that that is the appropriate way to redress the unfair prejudice suffered by Mr Attwood as a result of Mr Maidment's conduct. I have regard to the overriding principle applicable to the assessment of damages generally, as set out in the speech of Lord Blackburn in Livingstone v Rawyards Coal Company (1880) 5 Appeal Cases 25 at 39, that that sum of money should be awarded which will put the party (in this case Mr Attwood) who has been injured, or who has suffered, in the same position as he would have been in if he had not sustained the wrong, or (in this case) the unfair prejudice, for which he is now getting his compensation or reparation. It seems to me here that, as I have already indicated in my decision as to the appropriate valuation date, what should have happened is that the company should have been liquidated, rather than Mr Maidment transferring the properties to himself. Had there been a liquidation of the company, there would have been a pro rata distribution of the company's assets, under which Mr Maidment would have received 50 percent and Mr Attwood 50 percent of the net asset value on liquidation.
19. Another way of looking at the matter is as Mr Clutterbuck invited the court to do. The purpose of the buy-out order is to remedy the unfair prejudice suffered by Mr Attwood. It would be remarkable for him to get less, and still more remarkable for Mr Maidment to get more, than their pro rata 50 percent values, reflected by their 50 percent shareholdings in the company. Whether or not Mr Attwood benefited unduly by the award of the 50 percent shareholding to him at the outset, that was the deal that had been brokered between Mr Attwood and Mr Maidment; and a buy-out order should reflect that. Mr Clutterbuck took me, in this context, to Judge Purle's judgment in the Sunrise Radio Limited case (previously cited) at paragraphs 289-308. I am satisfied that, in the circumstances of this particular case, the only fair course is to require Mr Attwood's 50 percent shareholding to be valued on an undiscounted basis. This was a case in which Annacott was originally incorporated with a view to capital growth rather than the payment of dividends. I acknowledge that, long before October 2005, Annacott had ceased to be effectively a quasi partnership; but, nevertheless, it was a small private company, formed on an investment basis, and had Mr Maidment proceeded in an appropriate way, absent agreement from Mr Attwood the company should have been wound up on the just and equitable ground, resulting in a rateable 50 percent distribution of the company's net assets.
20. For those reasons, I reject the view that there should be any discount to reflect Mr Attwood's lack of control, bearing in mind Mr Maidment's position as the director of the company.
21. In summary, on the issue of relief, I hold that there should be a buy-out on the basis of a valuation of the company as at 1 October 2005, but with no discount to be applied to Mr Attwood's 50 percent shareholding to reflect his lack of control in view of Mr Maidment's position as the company's sole director. Interest should be awarded to Mr Attwood from the valuation date, but at a rate to be determined after the court has received appropriate further expert evidence on the matter.

2. The interim payment.

22. The issue of an interim payment was addressed at paragraphs 35-39 of Mr Clutterbuck's written submissions and at paragraphs 50-60 of Mr Grant's written skeleton argument. Mr Clutterbuck submits that, inevitably, there is likely to be a material delay in a final resolution of the amount Mr Attwood is to receive for his 50 percent shareholding in Annacott. On the evidence, he is in severe financial straits. He needs to repay both his father and Miss Heard for monies they have advanced to him in order to fund the present litigation, and also to fund future litigation over the quantification of what is due to him. By contrast, it is said that Mr Maidment has appropriated to himself the whole benefit of Annacott's property business; and he has enjoyed, not only the rents from the properties, but he has remortgaged them in his own name, extracting substantial equity from them. Mr Maidment disputes his ability to fund the level of interim payment sought by Mr Attwood; but this inability is disputed by Mr Attwood.
23. Mr Clutterbuck submits that it is undoubtedly fair that the court should order an interim payment now. He says that there is jurisdiction to do so, both under s.996 of the Companies Act itself, as part of the relief for unfair prejudice, and under CPR 25.7. He submits that such an interim payment would reflect both the court's readiness to see that a wronged party should receive redress as early as possible, and also address aspects of the overriding objective and, in particular, that aspect of it which seeks to ensure that the parties are on an equal footing.
24. Mr Grant objects that there is no jurisdiction to order an interim payment. He says, first, that the court has no jurisdiction under the CPR to make an interim payment on an unfair prejudice petition. He submits that the circumstances in which an interim payment can be made are exhaustively addressed in CPR 25.7. The particular rule on which Mr Attwood relies is CPR 25.7(1)(c), which requires him to establish that he would obtain judgment for a substantial amount of money (other than costs), i.e. a substantial money judgment. Mr Grant objects that Mr Attwood cannot establish that he will obtain a money judgment for any amount. He makes the point that no such relief is sought by the Annacott petition. What he is seeking is a mandatory order requiring Mr Maidment to purchase his shares at a fair price. He submits that CPR 25.7(1)(c) is not capable of being read so as to encompass an order of this sort. He also objects that for me, as the trial judge, to hear and determine Mr Attwood's interim payment application would cut across the basic, and mandatory, rule applicable to all interim payments, as prescribed by CPR 25.9, that the existence and amount of such a payment should not be disclosed to the trial judge until all questions of liability, and the amount of money to be awarded, have been decided, unless the defendant agrees. For present purposes, I am said to be the trial judge. It is said that this presents an insuperable obstacle to the judge determining Mr Attwood's application. It would be both contrary to the CPR, and would pre-empt the findings which I will ultimately have to make as to the terms upon which Mr Attwood should be granted relief in the Annacott petition.
25. Mr Grant also objects that there is no general discretion under s.996 of the Companies Act to order an interim payment. He says that, even if there were jurisdiction, the court should decline to exercise it, because it would operate contrary to the Civil Procedure Rules, and the court's inherent jurisdiction should not be invoked to do something contrary to those Rules. He submits that, to the extent that it was decided otherwise by the Inner House of the Court of Session in Scotland in Ferguson v Maclennan Salmon Company Limited [1990] BCC 707, that decision was wrong, and it is not binding upon me, and it should not be followed by me. Although it was common ground that an interim payment could be made on an unfair prejudice petition in Re Clearsprings (Management) Limited [2003] EWHC 2516, there was no actual decision of the court on the point. In any event, since no interim payment was awarded, any decision would, in any event, have been entirely obiter. Therefore, Mr Grant submits, that authority, too, is of no assistance on the question.
26. Mr Grant in his oral submissions contended that the case in the Inner House of the Court of Session was no basis to arrogate to the court a freestanding jurisdiction to order an interim payment, freed from the provisions of the CPR. He also submitted that the Clearsprings (Management) case was of nil precedential value, and of no assistance to the court.
27. Mr Grant also submitted that it would be inappropriate for the court, even if it had jurisdiction, to exercise its jurisdiction, in the circumstances of the present case, to order an interim payment. Mr Grant addressed that aspect of the matter at paragraphs 58-60 of his written skeleton argument. He also made the point that it would only be a matter of a few months before the price was determined, and the court should not be taken in by the present application, and Mr Attwood's protestations of financial need.
28. I am satisfied that the court has jurisdiction, both under s.996 and under CPR 23.7(1)(c), to order an interim payment in the circumstances of the present case. For the reasons given by the Inner House of the Court of Session, although they do not strictly bind me, I am satisfied that s.996 of the Companies Act 2006 does confer jurisdiction on the court to order an interim payment in circumstances where the court has decided that it should provide for the purchase of the shares in a company by one of its members. Section 996(1) says that if the court is satisfied (as this court is) that a petition under Part 30 is well-founded, it may make such order as it thinks fit for giving relief in respect of the matters complained of. In my judgment, that is sufficient to found jurisdiction.
29. I am reinforced in that view by the fact that in the Clearsprings (Management) Limited case distinguished company law counsel (Mr George Bompas QC for the petitioner and Mr Robin Potts QC for the respondents) were apparently both of the view that the court had jurisdiction, both under the relevant section and under the relevant provision of the CPR, to order an interim payment. Lawrence Collins J did not take issue with that, although, in the event, he did not find it appropriate to make such an order.
30. So far as CPR 23.7(1)(c) is concerned, that confers jurisdiction upon the court to make an order for an interim payment if the court is satisfied that, if the claim went to trial, the claimant would obtain judgment for a substantial amount of money (other than costs) against the defendant from whom he is seeking an order for an interim payment. I am satisfied here that, on the eventual determination of the sum to be paid for Mr Attwood's 50 percent shareholding in Annacott, a substantial sum of money will be ordered to be paid as the consideration for Mr Attwood's 50 percent shareholding in the company. I am satisfied that that is the equivalent of obtaining judgment for a substantial amount of money. It would be adopting an unduly strict, and literal, approach to the wording of CPR 25.7(1)(c), in the context of an unfair prejudice petition, for the court to conclude that the condition of that sub-rule is not satisfied. Effectively, the result will be that, when a buy-out order is made, the effect of the order will be that Mr Attwood will be receiving a substantial amount of money (other than costs). Mr Clutterbuck accepts that arrangements will have to be put in place to ensure that the shares held by Mr Attwood in Annacott are protected from any third party claims in relation to them by, for example, any trustee in bankruptcy if Mr Attwood were to be adjudged bankrupt. He has made the point that the share certificate is actually presently still in the possession of Macfarlanes, as solicitors for Mr Maidment, as it apparently has been now for over 7 years. Nevertheless, Mr Clutterbuck is content that some escrow arrangement should be put in place if an interim payment is to be made; and that certainly should be done.
31. I am satisfied, in the circumstances of the present case, that it is wholly appropriate that there should be an order, in the exercise of the court's discretion, for an interim payment. Although Mr Grant submits that it is only a matter of a few months before the price is determined, the history of this litigation, and of the parties' attitude to it, suggests to me that it may be more than a couple of months before that desirable end is achieved. I am satisfied, on the evidence, that Mr Attwood has a real need for immediate funds; and there is no reason why he should be kept out of the minimum amount that will be due to him for any longer than is absolutely necessary. I will hear submissions as to the time for payment; but I am entirely satisfied, in the exercise of my discretion, that it is appropriate for an interim payment to be made.
32. So far as the amount is concerned, in his written skeleton argument Mr Grant acknowledged (at paragraph 60(2)(d)) that Mr Attwood's shares might be valued at approximately £580,000, at most. Over the short adjournment, he produced a quantum analysis which suggested, after allowing a 20 percent shareholding discount, a figure of some £895,000. He suggested that the court should order no more than 50 percent of that figure. I have already rejected the notion of any discount being applied to the pro rata value of Mr Attwood's 50 percent shareholding. I am entirely satisfied that no injustice will be suffered by Mr Maidment if I order an interim payment of £500,000. That seems to me to be significantly below the minimum that Mr Attwood is likely to be entitled to receive for his 50 percent shareholding. When I mentioned that that was the figure I had in mind to Mr Clutterbuck, he indicated that he would not seek to argue against it.
33. So I will order an interim payment in the sum of £500,000, to be made at such interval of time as I will determine after hearing further submissions.

3. Directions and further expert evidence

34. On the issue of directions, I am satisfied that in the present case there should be separate expert property valuations produced for each party. Mr Clutterbuck contended that there should be a single joint expert in property valuation matters, and that that expert should be Mr Costa (the existing joint expert valuer). Mr Grant resisted both elements of that submission. I am satisfied that he was right to do so. In deciding whether there should be a single joint expert or not, the court must bear in mind the considerations identified at paragraph 7 of Practice Direction 35 - Experts and Assessors at paragraph 35PD7 of the current (2011) edition of Civil Procedure. I have those considerations firmly in mind. But I also have the benefit of my own previous experience in having heard evidence from Mr Costa, the single joint expert, on property valuation issues in the present case. I am satisfied, in the light of that evidence, and the difficulties to which it has given rise in relation to evidence of historic property values dating back to 2005, that, given the significance to the parties of this issue and the amount involved, it is appropriate to have separate experts for each party on issues of property valuation. I am satisfied, in the light of my experience of dealing with Mr Costa's evidence as a single joint expert, that the court will be assisted in its conclusion by evidence from more than one property valuer. But that does not apply to the expert in share valuation. Mr Grant acknowledged that, on that aspect of the matter, his position was less entrenched than that in relation to the property expert; and, indeed, he advanced no substantive reasons as to why there should not be a single joint expert on share valuation, as distinct from property valuation, other than pointing to the significance of the figures and their importance to the parties. I can see no reason why, with the benefit of separate expert valuation evidence from two valuers, there should not be a single joint expert on share valuation. The issues relevant to that exercise are very different from those in relation to undertaking a historic valuation of no less than 46 properties spread across London. If difficulties emerge then, of course an application can be made to revisit that aspect of my order; but, as things presently stand, I see no reason why there should not be a single joint expert on share valuation.
35. It occurs to me that, in dealing with issue 2, I have not separately addressed Mr Grant's point on CPR 25.9. If it be the case that that prevents me, having made an interim payment, from proceeding with the trial of the matter, then so be it. With Mr Maidment's agreement, I can continue to hear the matter; but, if he is not prepared to agree, I will invite further submissions as to whether I should recuse myself from further consideration of the issues in this case. But it does not seem to me that the existence, and terms, of CPR 25.9 are sufficient to prevent me from exercising the discretion, which I find I have, to make an interim payment.

4. The issue of costs

36. I am entirely satisfied that this is an appropriate case in which to award Mr Attwood and, so far as relevant in relation to Tobian, his co-respondent, Miss Heard, all of the costs of both petitions. Mr Grant addressed the issue of costs in paragraphs 48 and 49 of his written skeleton submissions. I have borne all that he had to say in mind. I also bear in mind the provisions of CPR 44.3. I acknowledge that the court has a discretion as to whether costs are payable by one party to another, the amount of those costs, and when they are to be paid. By CPR 44.3(2), if the court decides to make an order about costs, the general rule is that the unsuccessful party will be ordered to pay the costs of the successful party; but the court may make a different order. In deciding what order, if any, to make about costs, the court must have regard to all the circumstances, which include the conduct of all the parties, whether a party has succeeded on part of his case, even if he has not been wholly successful, and any payments into court or admissible offers to settle. I also bear in mind the definition of "conduct" in CPR 44.3(5).
37. Mr Grant's primary submission was that no order for costs should be made at this stage because it would be premature to do so. He makes the point that the proceedings have not yet been concluded, and that the present trial is still ongoing. There was directed to be a single trial of all the issues; and all the issues have not yet been determined. It would, in those circumstances, be premature to pre-judge the issue of costs. He also makes the point that there is really no need to do so, because Mr Maidment has already made the equivalent of a payment on account of costs of £100,000, which is said to represent a substantial proportion of the sums claimed by him in respect of costs. Mr Grant submits that the proceedings are likely to be concluded in the not too distant future; and any order for costs should await that conclusion in the usual way.
38. I reject those submissions. It is quite clear to my mind, and in the exercise of my discretion, that I should address the issue of costs at the present time down to the date of this order. I accept Mr Grant's submission that it would be wrong to differentiate between the petitions in relation to Annacott and to Tobian. I should make a single order because it would be difficult, if not impossible, to distinguish between them. But it seems to me that now is the appropriate time to be making any order. I acknowledge the points made by Mr Grant in paragraph 49 of his written skeleton argument, and the additional points he made orally in relation to the exercise of the court's discretion. I bear those matters fully in mind.
39. Adopting the structured approach in CPR 44.3, I have no doubt whatsoever that, in relation to both petitions, the successful party is Mr Attwood and, in the case of the Tobian petition, Miss Heard. I acknowledge that I made certain criticisms of Mr Attwood, his evidence, and his conduct of the proceedings in the course of my judgment. I have borne those matters in mind. I acknowledge that I found Mr Attwood to be an unreliable witness, with a tendency to embellish his evidence, although I also found that he was not deliberately lying. I also found that he had deliberately waited to issue his petition in relation to Annacott until after the insolvent demise of Tobian. Against that, however, I must also bear in mind issues of conduct on the part of Mr Maidment. I found him, too, to be an unsatisfactory witness, who was unconvincing in certain aspects of his evidence; and I found him to have been not honest in all of his evidence, and, indeed, to have lied in certain aspects of it. Mr Grant fairly makes the point that there was no letter before the issue of the Annacott petition; but I am entirely satisfied, having seen and heard the individuals concerned, that any letter before action would have achieved absolutely nothing. I therefore do not see that it is an issue of conduct which, although relevant, should affect my ultimate decision in the exercise of my discretion as to costs. Although certain criticisms can properly be made of Mr Attwood, nevertheless far more serious criticisms can be made of Mr Maidment.
40. Bearing all of those considerations in mind, and bearing in mind also the overriding objective in CPR 1.1, and the difficulties that would follow in seeking to distinguish between the costs referable to the two petitions, looking at the matter in the round, and in the exercise of my discretion, I have no hesitation whatsoever in finding that Mr Attwood and, so far as appropriate, Miss Heard, should receive their costs of both petitions. However, bearing in mind the criticisms that can be directed at Mr Attwood, and notwithstanding the points made by Mr Clutterbuck in relation to Mr Maidment's conduct of the litigation, it does not seem to me that this would be an appropriate case to order any element of the costs to be assessed otherwise than on the usual standard basis. I was directed to the relevant principles at paragraph 44.4.3 of the current edition of Civil Procedure, and to the guidance in Excelsior Commercial & Industrial Holdings [2002] EWCA Civ 879. It does not seem to me that the facts of this case and/or the conduct of the parties, bearing both parties' conduct in mind, is such as to take the situation away from the norm, particularly in the context of unfair prejudice petition litigation and the issues and conduct to which that generally gives rise. In any event, it does seem to me that it would create practical difficulties in ordering the costs of the Annacott petition to be assessed on one basis, and those of the Tobian petition on another.
41. Therefore, my order will be that Mr Maidment should pay the costs of both petitions without any discount; but such costs will be assessed on the standard basis, rather than the indemnity basis, if not agreed.
42. So far as the second respondent to the Annacott petition, Miss Maidment, is concerned, however, it does not seem to me that she should bear any part of those costs. I bear in mind Mr Clutterbuck's point that she did sign the defence to the Annacott petition and the statement of truth contained within it. I addressed the position of Miss Maidment in my judgment at paragraphs 83 and 84. Mr Attwood acknowledged that in his written evidence he had been "unfair to Sarah". Until that written evidence, she had not put in any evidence herself; and when she did put in written evidence, Mr Clutterbuck, for Mr Attwood, sought to exclude it. He was unsuccessful. In the event, the correctness of Miss Maidment's written evidence was acknowledged, fairly enough, by Mr Attwood in his own oral evidence. As a result, Miss Maidment was not subject to any probing or serious cross-examination. I found her to be an honest and reliable witness. She readily accepted, notwithstanding what she had signed in the defence, that she had no interest in Annacott. I made the point in my judgment that there had been no counterclaim for relief by her, as distinct from Mr Maidment. There was no assertion of any act of unfair prejudice or conduct on her part; and she received no benefit from Mr Maidment's own unfairly prejudicial conduct. She only appeared at trial in order to give evidence in response to what Mr Attwood acknowledged was an unfair allegation on his part. She only holds one of 5,000 shares in the company. As the only other shareholder apart from Mr Attwood and Mr Maidment, she was a necessary party to the litigation; but in no way did she actively defend the petition, and in no way did her involvement add to the costs of the trial or proceedings in any way, save to the extent that this had been brought about by Mr Attwood's own unfair assertions against her.
43. In those circumstances, it would be contrary to justice to make any order for costs against her personally. So far as Miss Maidment is concerned, therefore, there will be no order as to costs, either against her or in favour of her.