England and Wales High Court (Chancery Division) Decisions

IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
ON APPEAL FROM MASTER BRAGGE
IN THE ESTATE OF ABDUS SATTAR SHEIKH DECEASED

		Royal Courts of Justice Strand, London, WC2A 2LL
		12/04/2011

Mr Justice Briggs :

INTRODUCTION

1. This is an application for permission to appeal (with the appeal to follow) by the claimant Mr Ghouse Abdul Wahab against the striking out by Master Bragge on 29^th April 2010 of his claim for the revocation of probate of his brother's purported will, on the ground that the claim is an abuse of process. Mr Wahab's claim was struck out on the application of the first defendant Mr Amir Khan who proved the will, and who is the principal beneficiary thereunder.

THE FACTS

2. Abdus Sattar Sheikh ("the Deceased") died in England on 5^th February 2005. Mr Wahab was his only full brother. He lives in India and is aged 80. The Deceased was also survived by a half-brother, a Mr Ghouse Munawar.
3. On 6^th June 2005 probate of a purported will of the Deceased dated 19^th December 2004 was granted to Mr Khan and the second defendant Mr Mohammed Jamal. The estate consisted of real properties situated in England and cash. The named beneficiaries were Mr Khan as to 70% and Mr Jamal as to 30%. Neither of them are blood relations of the Deceased. Mr Wahab's case is that Mr Khan was a builder who did work for the Deceased and that Mr Jamal was one of his tenants.
4. On 30^th July 2007 Mr Munawar commenced a Part 8 Claim ("the 2007 claim") seeking the revocation of probate, based upon an allegation that the will was a forgery. Mr Khan and Mr Jamal were the defendants to that claim. At an interim application on 16^th August 2007 Mr Munawar obtained, in the form of undertakings, a restraint upon the distribution of the estate by the defendants.
5. At a further interim hearing on 20^th August 2007 Kitchin J ordered that Mr Wahab be substituted as the claimant, and that the claim be continued as if it had been made under Part 7 rather than the (obviously inappropriate) Part 8. Mr Munawar was ordered to pay the defendants £5,000 towards their costs to date and the undertakings given by the defendants were continued.
6. From that point onwards, the prosecution of the 2007 claim ran out of steam. The evidence as to why this was so is inconclusive. Mr Wahab appears to have spent part of the following few months in hospital in India. More importantly there was evidence before the Master that he had failed to put or keep his English solicitors in funds, or to give them instructions.
7. In February 2009 the first defendant's solicitors suggested that the claim be discontinued with each side paying its own costs. Mr Wahab's solicitors appeared to be without instructions to agree, and they applied to come off the record.
8. In the meantime, on 10^th April 2009 Peter Smith J granted the first defendant's application to strike out the claim. The evidence in support of that application relied upon a failure by Mr Wahab to comply with CPR Part 57.5 in relation to provision of testamentary documents, the non-payment of the £5,000 costs ordered to be paid by Mr Munawar and Mr Wahab's failure to prosecute the action after September 2007. The skeleton argument in support of the application relied upon the first and third of those grounds. Mr Wahab did not attend and was not represented. Peter Smith J granted the application and ordered Mr Wahab to pay Mr Khan's costs, subject to detailed assessment if not agreed. No agreement as to the costs payable was reached between the parties, and no application for a detailed assessment has since been made by Mr Khan.
9. Mr Wahab's enthusiasm for his claim appears to have revived in June 2008, but it was not until 30^th October 2009 that he issued a fresh claim, again under Part 8, against Mr Khan and Mr Jamal, joining in addition as third and fourth defendants the two persons appearing on the will to have been the attesting witnesses. I shall refer to it as "the 2009 claim".
10. The substance of the 2009 claim was exactly the same as in 2007, namely an attempt to obtain the revocation of probate upon the grounds of forgery and lack of due execution. Annexed to the Particulars of Claim is a report from Robert Radley, a forensic handwriting and document examiner, prepared in July 2007 in connection with the 2007 claim in which, on the basis of what he describes as "very strong evidence" he expresses the opinion that it is very unlikely that the two signatures purporting to be made by the Deceased on the will were in fact made by him.
11. Having protested (amongst other things) about the continuing failure by Mr Wahab to pay costs in the 2007 claim, Mr Khan issued an application to strike out the 2009 claim on 31^st March 2010, seeking security for costs in the alternative. That application came on for hearing on 29^th April 2010 at the same time as the date fixed for the case management conference.

MASTER BRAGGE'S JUDGMENT

12. Master Bragge gave a detailed extempore judgment, a transcript of which he subsequently approved. After reciting the facts (in a manner which is not challenged on this appeal) he directed himself as to the law by reference to CPR 3.4(2), to the overriding objective, and to notes in the 2010 White Book at paragraphs 3.4.3.1 and 3.4.3.5. It does not appear that he had any authorities cited to him, but some of the most relevant authorities are summarised in those notes.
13. Having noted that the 2009 claim repeated the same inappropriate use of Part 8 (rather than Part 7) and that there had been a similar failure by Mr Wahab to comply with CPR 57.5, Master Bragge considered (at paragraph 35) that he needed to decide whether the Statement of Case in the 2009 claim was an abuse of the court's process. He reminded himself that the bringing of successive or concurrent vexatious proceedings may be an abuse if it amounts to harassment of a defendant, and he recognised the modern practice that, where a previous claim is struck out on the grounds of delay, then a subsequent claim may, even if not statute-barred, be struck out because "the claimant's wish to have a second bite at the cherry has to be weighed with the overriding objective of the Civil Procedure Rules in mind, in particular the court's need to allot its limited resources to other cases".
14. The Master's conclusion was that the bringing of the 2009 claim was an abuse, and that nothing short of its striking out was a sufficient or appropriate response. His reasoning may be summarised as follows. First, the 2007 claim had not merely failed, but been struck out after the obtaining by Mr Wahab of significant interim relief, and in response to his failure to provide either instructions or funds to his solicitors. Secondly, the Master considered but rejected the less draconian course of staying the 2009 claim pending assessment and payment of the costs ordered in the 2007 claim, because the history of Mr Wahab's inactivity gave him "no confidence that that course would achieve anything other than the expense to the first defendant of a detailed assessment hearing".
15. Finally, the Master took account of the apparent strength of Mr Wahab's expert evidence, but concluded that, having regard to the successive failures in both claims to comply with Part 57.5, that "this case really cannot continue".

THE LAW

16. The bringing of a second claim where an earlier claim based upon the same facts or seeking the same relief has failed may give rise to a number of different types of what may loosely be called an abuse of process. The clearest instance is where the claim or issue in dispute has already been adjudicated upon between the same parties (or their privies) in the earlier case, where the second claim will generally be barred as being res judicata, or subject to a fatal issue estoppel. That is a matter of substantive law, rather than the court's case management powers arising from abuse of process: see Johnson v. Gore Wood and Co [2002] 2 AC 1 at 59 E per Lord Millett.
17. The second is where the claim or issue raised in the second case is one which both could and should have been brought in the first case, where the first case has either been adjudicated upon or concluded by a settlement. This is what is sometimes called Henderson v. Henderson abuse (a label derived from the leading case of that name) but is comprehensively analysed in Johnson v. Gore Wood. It is underpinned by the same public interest that there should be finality in litigation and that a party should not be twice vexed in the same matter: see per Lord Bingham at page 31B. The question whether such a claim should have been raised for adjudication in earlier proceedings requires a "broad, merits-based judgment which takes account of the public and private interests involved and also takes account of all the facts of the case, focussing attention on the crucial question whether in all the circumstances, a party is misusing or abusing the process of the court by seeking to raise before it the issue which could have been raised before" per Lord Bingham at page 31D to E. For a concise summary of the relevant principles see Dexter Ltd v. Vlieland-Boddy [2003] EWCA Civ 14, per Clarke LJ at paragraph 49.
18. Generally, cases of those first two types arise where there has either been an adjudication (whether at trial or summary judgment) or a settlement of the earlier claim. In such cases the abuse (if established) lies in bringing the same claim at all. The question whether such an abuse has been established (the onus for that purpose being on the person seeking to strike out the second claim) is not a matter of discretion, but rather:

"A decision involving the assessment of a large number of factors to which there can, in such a case, only be one correct answer to whether there is or is not an abuse of process."

See Aldi Stores Ltd v. WS Group plc [2008] 1 WLR 748 at 762C per Thomas LJ. Nonetheless, an appellate court will be reluctant to interfere with a careful balancing of the relevant factors by the first instance judge, provided that he has not omitted to take account of material factors, erred in principle or come to a conclusion that was impermissible or not open to him.

19. Where the first claim has neither been adjudicated upon nor compromised, but merely struck out for specific procedural default or more generally for want of prosecution, then different types of potential abuse may arise. The first is where the claimant brings the second claim without complying with any relevant order for costs made against him in the first. In such a case the potential for abuse lies in the unfairness of putting the defendant to the expense of fresh proceedings while his costs of the previous proceedings remain unpaid: see Investment Invoice Financing Ltd v. Limehouse Board Mills Ltd [2006] 1 WLR 985, at paragraphs 34 and 47, per Moore-Bick LJ. It has been recognised since the mid-nineteenth century that the normal response of the court to such a case is to stay the second claim until the costs ordered in the first claim have been paid. The jurisdiction to stay is discretionary, and depends upon a consideration of all the circumstances: see per Moore-Bick LJ at paragraph 46. In such a case the abuse lies not in bringing the second claim at all, but in doing so without first paying the defendants' costs of the first claim. It may be appropriate to provide, in addition to a stay, for a striking out of the second claim if the costs of the first claim are not paid by a certain date: see Investment Invoice Financing (supra) at paragraph 48.
20. The distinction between the cases where the bringing of a claim is an abuse, and where the abuse consists of doing so without paying the defendants' costs of the earlier claim, is spelt out in terms in CPR 3.4(2) and (4), and the different form of remedy for each type of abuse is separately identified.
21. The bringing of a second claim where the first has been struck out for inordinate and inexcusable delay may give rise to a third and distinct type of what may loosely be called abuse, namely a disproportionate use by the claimant of the court's resources. In Securum Finance Ltd v. Ashton [2001] Ch 291 at 309, Chadwick LJ said this at paragraph 34:

"For my part, I think that the time has come for this court to hold that the "change of culture" which has taken place in the last three years—and, in particular, the advent of the Civil Procedure Rules—has led to a position in which it is no longer open to a litigant whose action has been struck out on the grounds of inordinate and inexcusable delay to rely on the principle that a second action commenced within the limitation period will not be struck out save in exceptional cases. The position, now, is that the court must address the application to strike out the second action with the overriding objective of the Civil Procedure Rules in mind—and must consider whether the claimant's wish to have "a second bite at the cherry" outweighs the need to allot its own limited resources to other cases. The courts should now follow the guidance given by this court in the Arbuthnot Latham case [1998] 1 WLR 1426, 1436-1437:

"The question whether a fresh action can be commenced will then be a matter for the discretion of the court when considering any application to strike out that action, and any excuse given for the misconduct of the previous action: see Janov v Morris [1981] 1 WLR 1389. The position is the same as it is under the first limb of Birkett v James. In exercising its discretion as to whether to strike out the second action, that court should start with the assumption that if a party has had one action struck out for abuse of process some special reason has to be identified to justify a second action being allowed to proceed."

22. The Arbuthnot Latham case was one in which the claimant in the first claim was guilty not merely of delay, but of contumelious conduct properly to be characterised as an abuse of process. It was recognised by the Court of Appeal in that case, following Grovit v. Doctor [1997] 1 WLR 640, that continued litigation with no intention to bring it to a conclusion can amount to an abuse of process. It follows that a careful assessment of the question whether this third type of potential abuse is demonstrated in any particular case requires an analysis both of the claimant's conduct of the earlier claim, and the reasons for its being struck out, as well as an appreciation of the extent to which the combined effect of the first and second claims may place a disproportionate burden on the court's resources, as well as a balancing of those factors against the reasons why the claimant wishes to have a second bite of the cherry.
23. Miss Barbara Rich for the Appellant, who did not appear at the hearing before Master Bragge, sought to persuade me that claims for the revocation of probate occupy a special status in relation to which delay in their institution should not easily justify their being struck out. She relied upon Re Flynn Deceased [1982] 1 WLR 310, and upon the following recitation by Slade J of a submission by counsel for the plaintiff in that case, at page 316 A to B:

"After an action of this nature has been started, he submitted, the court is under a duty to investigate the propriety or otherwise of the order under which the relevant grant was obtained, no matter how extreme the delay. The court, in his submission, is sitting as a court of conscience concerned with the sanctity of probate, so that it must allow the validity of the grant of probate to be investigated at whatever date the challenge may be made, unless there are other grounds, apart from questions of delay, upon which it is obvious that the action must, in due course, fail."

24. While it is true that Slade J went on to hold that there was no prior authority supporting the case that delay in institution might warrant the striking out of a probate claim, he made no comment, one way or the other, on the soundness of counsel's submission. In my judgment, in particular after the introduction of the Civil Procedure Rules, there can be no such special rule applicable to probate cases, derived from any supposed sanctity of a grant of probate.
25. The fact that the bringing of a successive claim for the same relief may involve one or more of a number of different types of potential abuse does not of course mean that the court is obliged to consider each entirely separately, without any regard to their combined effect, or to the appropriateness of different types of relief based upon an appreciation of the abusiveness of the second claim, viewed in the round. Nonetheless I consider that it is incumbent upon the court to do more than ask simply whether the claim sought to be struck out involves an abuse, without regard to its potentially adverse consequences in terms of injustice or unfairness to the defendant, and/or disproportionate use of the court's resources.

ANALYSIS

26. I have considerable sympathy with the Master, who was not taken to any of the authorities to which I have referred, albeit that Securm Finance v. Ashton was identified and summarised in the White Book note 3.4.3.5 to which the Master referred at paragraph 38 of his judgment. Nonetheless I do not consider that he conducted a sufficient analysis of the nature and effect of the supposed abuse before concluding that it was an abuse of process for Mr Wahab to have brought the second claim at all, at paragraph 40.
27. His reasons for that conclusion (at paragraph 41) were that Mr Wahab had allowed the first claim to drift without either instructing or funding his solicitors but while having obtained substantial and serious interim relief. He had already concluded (at paragraph 32) that, save in relation to the £5,000 ordered to be paid by Mr Munawar, there was no enforceable order for costs against Mr Wahab which he had failed to pay. He acknowledged (at paragraph 39) that the case before him was not directly analogous to the examples of abuse provided in the notes in the White Book to which he had been referred.
28. Taking the alternative types of abuse which I have described in turn, there was of course potential for real unfairness to Mr Khan, both in not having been paid the £5,000 ordered against Mr Munawar, and in being out of pocket for the much more substantial costs which he incurred in relation to the interim application for restraint upon the administration of the estate. But in that respect he was largely the author of his own misfortune in not seeking to have his costs assessed, so as to give rise to an enforceable liability upon Mr Wahab to pay them. While I appreciate that he may have been disinclined to incur the costs of assessment against an opponent resident in India who had failed to fund his own solicitors, he could have largely avoided that disadvantage by obtaining an order for an interim payment from Peter Smith J, but did not do so.
29. Miss Rich accepted that, in the light of the analysis of the position of an assignee of a cause of action in the Investment Invoice Financing case, she had to acknowledge Mr Wahab's responsibility to discharge the £5,000 costs order against Mr Munawar, as a necessary precondition for pursuing the 2009 claim. However that may be, questions arising from the costs of the first claim did not of themselves render the mere bringing of the second claim an abuse of process nor, therefore, justify the striking out of the second claim rather than a stay, coupled with such other orders as might be necessary to facilitate the prompt detailed assessment of the costs of the 2007 claim.
30. This was not a case where the substance of the second claim had either been adjudicated upon in the first claim, or where the second claim raised matters which both could and should have been raised for adjudication in the first claim. As Mr Robson for Mr Khan properly acknowledged, this is not a case of res judicata, issue estoppel, or even Henderson v. Henderson abuse, because the 2007 claim was struck out for procedural default and delay, rather than adjudicated upon or compromised.
31. Nor, as it seems to me, was it a case in which there was demonstrated any disproportionate use of the court's resources. True it is that there were during the 2007 claim three short interim hearings concerned mainly with injunctive relief but, since the estate has now been administered (presumably by distribution to the first and second defendants as beneficiaries) and since no interim relief is sought in support of the 2009 claim, it seems unlikely that those resources will be used again. By contrast, there was no case management conference or other case management of the first claim likely to be duplicated in the second claim, because the first claim was allowed to go to sleep immediately after interim relief had been obtained.
32. Leaving aside the defendants' costs of the 2007 claim (which I was told related mainly to the interim applications) it has not been shown that either Mr Khan or Mr Jamal have been or will be subjected to any duplicative cost of responding to the underlying allegation of forgery. The 2007 claim went to sleep before they were required to serve a defence, and the strike out application in the 2009 claim was made and succeeded before they took any steps to serve a defence in that claim either. The defendants have not suggested that they suffered some prejudice separate and distinct from costs by reason of the existence of the interim undertakings between September 2007 and April 2008 (when they were discharged).
33. Finally, the first claim was struck out for what seems to me to have been a relatively technical breach of the rules (since Mr Wahab had no relevant testamentary documents to produce other than a photocopy of the disputed will), coupled with a delay of only some seven months.
34. The defendants have sought to make something of the point that Mr Wahab appears now to be unable to locate and therefore serve the attesting witnesses who he has (unnecessarily in my view) joined as additional defendants to the 2009 claim. It is suggested that this may impede a fair trial of the serious forgery allegation. In my judgment there is no real substance to this point. First, the disputed will is, together with other documents signed by the Deceased, available for expert analysis. Secondly, there is no evidence that the attesting witnesses (who are in any event alleged by Mr Wahab to be imaginary) would have been any more traceable for the purposes of obtaining their evidence during the conduct of the 2007 claim, than they have been in and after 2009.
35. It is not suggested by Mr Robson that either the 2007 or 2009 claims are inherently vexatious, in the sense that they lack a real prospect of success. The handwriting expert's report makes it clear that the undoubtedly serious allegation of forgery is one which discloses a real, rather than fanciful, case to answer. Since the defendants as executors have distributed the estate to themselves as beneficiaries, the fact that the estate has been administered between the striking out of the 2007 claim and the bringing of the 2009 claim is not of itself a substantial ground for regarding the 2009 claim as imposing an unfair burden on the defendants, as might have been the case if the estate had, in the meantime, been distributed to third parties.
36. Looking at the matter in detail therefore, I have been unable to identify any solid basis, apart from their still unpaid costs, why is should be regarded as unfair or unjust for the 2009 claim to be pursued against the first and second defendants, nor why it would involve even a real risk of the disproportionate use of the court's resources. It follows that in my judgment it was not an abuse of process merely to bring the 2009 claim even though, by allowing the 2007 claim to drift for some seven months while retaining the benefit of interim relief, it may be said that Mr Wahab's conduct of that claim was during that period abusive. It is therefore a case in which Mr Wahab's reason for wishing to pursue the 2009 claim must be weighed against that element of abusiveness in his conduct of the first claim, conduct for which he has not provided a satisfactory explanation.
37. Having concluded that the Master's approach to the question whether an abuse had been demonstrated was flawed, for the reasons which I have given, it falls to me to decide, using his phrase: "what should the court do in the present circumstances".
38. In my judgment it is altogether too rigorous a sanction for Mr Wahab's allowing the first claim to go to sleep for seven months while enjoying the benefit of interim relief to prohibit him altogether from pursuing the second claim. It is well established that a party who fails diligently to prosecute a claim while benefiting from interim relief may be deprived of that relief, regardless of the merits. In the 2009 claim Mr Wahab has not sought interim relief and, were he to do so, the court might well refuse it for that reason.
39. The more serious question arises from the unpaid costs. I am not satisfied that the Master's solution, namely to strike out the case because a stay would have left Mr Khan with the unattractive option of incurring the costs of a worthless assessment, was the correct or permissible response. The Master noted that Mr Wahab's solicitor had offered to undertake to pay those costs once assessed in a witness statement relied upon at the strike out hearing before him. Since the solicitor did not attend the hearing I can well understand why the Master had doubts as to the value of the undertaking. Nonetheless the undertaking has been proffered before me by Miss Rich on behalf of Mr Wahab's solicitors, and the court is able to fashion an order now which ensures that, before Mr Khan is put to the trouble of obtaining a detailed assessment of his costs of the first claim, Mr Wahab has at least paid the £5,000 costs ordered to be paid by Mr Munawar in the 2007 claim.
40. I propose therefore to give permission to appeal, to allow the appeal, and to substitute an order to the following effect:

i) That Mr Wahab pay within fourteen days the £5,000 costs ordered to be paid by Mr Munawar in the 2007 claim, failing which the second claim be struck out.

ii) That if the £5,000 be paid Mr Khan be at liberty to lodge within three months of today an application for detailed assessment of his costs of the 2007 claim.

iii) That the 2009 claim remain stayed until that application has been lodged and, if lodged within that time, determined by the costs judge, and thereafter until those costs have been paid by Mr Wahab.

iv) That in the event that Mr Wahab fails to pay those costs within two months of service of a costs certificate, the 2009 claim be struck out.

41. I will hear submissions as to how the alternative application by Mr Khan against Mr Wahab for security for costs of the 2009 claim should be determined.