England and Wales High Court (Chancery Division) Decisions

IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION

		The Rolls Building 7 Rolls Buildings Fetter Lane London EC4A 1NL
		2nd November 2016

1. MR JUSTICE NUGEE: This is a second pre-trial review in an application by Mr Thomas Haederle against a Mr Dierk Thomas, both the applicant and the respondent being of German origin, to commit Mr Thomas for breaches of a freezing order made as long ago as 2007. The brief background is as follows. Mr Haederle and Mr Thomas were previously shareholders in a company. Mr Haederle conceived that Mr Thomas had acted in a way that constituted unfair prejudice to him and brought a petition under what was then section 459 of the Companies Act 1985.
2. At trial, Evans-Lombe J found that, indeed, Mr Thomas had acted in a way that constituted unfair prejudice and made an order that Mr Thomas buy out Mr Haederle's interests in the company at a value to be assessed. That was on, I was told, 13 June 2007. The next day, Mr Haederle obtained from Henderson J a freezing order without notice which froze Mr Thomas's assets up to a level of £560,000 and that was renewed on the return date on 21 June 2007 by Blackburne J at what was an inter partes hearing, although, in fact, Mr Thomas was not present at the hearing. It has been accepted by Mr Thomas in the past that he was aware of the terms of the freezing order by 2 August 2007.
3. In October 2007, Mr Haederle brought an application to commit Mr Thomas for failure to comply with the usual provision in a freezing order requiring the respondent to swear an affidavit confirming his assets. That was in paragraphs 8 and 9 of Henderson J's order, paragraph 8 providing that, "unless paragraph 2 applies [which is a reference to the right not to incriminate oneself] the Respondent must within 48 hours of service of this order, and to the best of his ability, inform the Applicant of all his assets worldwide exceeding £1,000 in value, whether in his own name or not and whether solely or jointly owned, giving the value, location and details of all such assets," and paragraph 9 providing that within 7 working days after being served with the order, "the Respondent must swear and serve on the applicants an affidavit setting out the above information."
4. Blackburne J heard that application to commit on 22 October 2007. He found the contempt established. He fined Mr Thomas the sum of £10,000, which I was told had been paid. Mr Thomas was also debarred from taking further part in the proceedings and, in particular, that meant he could not attend the proceedings to assess the value of Mr Haederle's interests in the company which he was to buy out and that was subsequently assessed at a sum of about £867,000.
5. In December 2007, Mr Thomas applied to the Court to purge his contempt. There were put before the Court, on his behalf, three documents and I will have to come in some detail to the second one which was described as an affidavit and was dated 12 December 2007 but, as I will explain, was not signed or, at any rate, cannot be shown to have been signed, by Mr Thomas. The upshot of that hearing was that Warren J, who heard the application on 20 and 21 December 2007, was unpersuaded that Mr Thomas had been fully forthcoming about his assets and the result was he held that Mr Thomas had not purged his contempt, and there matters rest so far as that application is concerned.
6. The present application was brought by Mr Haederle, initially alleging a very large number (some 40, I believe) of breaches of the freezing order and other contempts but, as a result of successive hearings, most recently before Henderson J in July of this year, most of those allegations have fallen away. In particular, in a judgment handed down on 22 July 2016, Haederle v Thomas [2016] EWHC 1866 (Ch), Henderson J had to consider the effect of the form of freezing order, which contained a typographical error in paragraph 7(2), which read as follows:

"If the total unencumbered value of the Respondent's assets in England and Wales does not exceed £560,000, the Respondent must not remove any of those assets from England and Wales and must not dispose of or deal with any of them. If the Respondent has other assets outside England and Wales, he may dispose of or deal with those assets outside England and Wales, so long as the total unencumbered value of all his assets whether in or outside England and Wales remains above £ "

and then it is left blank.

7. Henderson J held that although it was perfectly obvious to anyone acquainted with the law and practice that the intended figure was £560,000, the failure to include that figure meant it was not sufficiently clear to Mr Thomas what he did or did not have to do and, as set out in his judgment, he concluded that the freezing order was therefore unclear and uncertain in its application to Mr Thomas: paragraph 7(2) was evidently intended to grant him permission to deal with his non-English assets, so long as they exceeded a specified value, but that value was not stated. He said:

"However undeserving his conduct may seem, in my judgment, he should not find himself at risk of imprisonment or payment of a fine in respect of dealings with his non-English assets when the order served upon him was deficient in this material respect."

8. The effect of that was that he ruled the committal could not go ahead in respect of dealings with non-English assets. He required, in an order dated 22 July, that the applicant should reformulate the grounds of committal and there be a further PTR (which is what is before me today) at which the first respondent, Mr Thomas:

"…should file and serve a revised list of issues, if any, suitable to be determined at a PTR in response to the reformulated grounds. Such a list of issues will replace the existing list of issues and must…"

and then there is provision for setting out what issues are being raised and giving particulars of facts and propositions of law upon which the first respondent relies. In the event, that was done by way of a document filed by Mr Tear, the solicitor advocate acting under a legal aid order for Mr Thomas, but in Mr Tear's absence today, Mr Anthony Higgins of counsel has appeared, having had the legal aid order extended to enable him to appear on this hearing. He has argued two points which he says amount to grounds that make it clear the reformulated grounds for committal stand no reasonable prospect of success and therefore should be stopped at this stage.

9. Mr Watson, who appears for Mr Haederle, has made the point that no formal application is before the Court but it does seem to me that Henderson J's order envisaged that the respondent should have an opportunity at this PTR of submitting there were reasons why the committal should not proceed to a full hearing and if and insofar as necessary, I will waive the failure to issue a formal application notice. Only two grounds for committal appear in the reformulated grounds and I will deal with them in turn. The first one, Ground 1, is an allegation that Mr Thomas made false statements in an affidavit and it relies on what I will call, without prejudging the issue, Mr Thomas's second affidavit put before the Court on 20 December 2007.
10. Mr Haederle's evidence in relation to what happened is found in his 7th affidavit, dated 19 February 2016. He said that on 17 December 2007 Mr Thomas's solicitors handed him a copy of the affidavit in unsworn form. That document has been exhibited to Mr Haederle's 6th affidavit dated 3 July 2015, which is the substantive affidavit in support of the committal. The version exhibited to that 6th affidavit is in the following form. It is headed "Second affidavit of Dierk Thomas". It says it is made on behalf of the first respondent, that the deponent is D Thomas, that the number of the affidavit is the second and it is dated 12.12.07. It commences in the traditional way, "I, Dierk Thomas," and then it gives an address, and continues "make oath and say as follows." Then it starts off "This is my second affidavit in this matter…" and it then purports to deal with the requirement to disclose assets of over £1,000. On the final page, it contains a form of jurat "sworn at … in the County of …this…2007 before me, solicitor/Commissioner for Oaths," but the jurat has not been completed and it bears no signature.
11. Mr Haederle, in his 7th affidavit, says:

"When Mr Thomas's application to purge his contempt came before Warren J on 20th of December 2007, Warren J noted, among other things, the form of affidavit in the bundle was unsworn."

He then says this:

"In response, DT's…"

(that is Mr Thomas's)

"…counsel submitted that the unsworn affidavit had, in fact, been sworn but that the sworn copy had not made it into the bundle.

I am in possession of the bundle that was before the judge. On the

side of his copy, the judge noted by hand, "it is sworn." This copy is

exhibited with this third committal application as exhibit TH/643, [which

is a reference to the exhibit to his sixth affidavit.]"

Indeed on the version put in evidence in that exhibit there is written in manuscript against the form of jurat "It is sworn" in handwriting, which appears, consistently with what Mr Haederle says, to be Warren J's handwriting, with which I am personally familiar.

12. Mr Haederle explains that on the next day, 21 December 2007, Warren J handed down a long judgment but it appeared the Court's recording equipment had failed and he was, therefore, unable to obtain a transcript of his judgment He then, at paragraph 12 of his 7th affidavit, sets out what, from memory (and it is to be noted, this is memory which he is exercising in February 2016 as to a judgment handed down in December 2007) he was able to say, as follows:

"Mr Justice Warren found the first affidavit unconvincing and noted there was no excuse for so bluntly ignoring the court's orders. The court had not been able to establish the truth of any of DT's claims because DT had not appeared in court and could not be questioned. Thirdly, the court found that DT, by filing and serving the unsworn affidavit, which is a reference to the so called second affidavit, the third affidavit and the two witness statements did appear to have complied with the formal requirements of the FO…"

(that is the freezing order)

"…but found that the unsworn affidavit, the third affidavit and the two witness statements are unconvincing and do not contribute anything to clarify DT's financial situation. In particular, DT's submission, through his counsel, that company C paid DT's legal fees at £35,000 as a gift from friends did not satisfy the court and there was clear evidence that he was working for them. The court was unable to establish if DT's claims were true or not because DT had not been in court to be questioned and cross-examined. The matter of the truthfulness of the affidavits and witness statements was, therefore, to be determined in the adjourned hearing of the committal application."

13. Since the 6th affidavit and, indeed, 7th affidavit of Mr Haederle, however, a version of the document has come to light which has the signature of a person on the line which starts "before me" and underneath has "solicitor/Commissioner for Oaths", as well as the stamp of a firm of solicitors, Sharpe Pritchard, with their address. I have been addressed, therefore, on the basis that it will, or may, be possible to establish to the requisite standard of proof that the document, which I will call the second affidavit, was signed by a solicitor or Commissioner for Oaths but was not signed by Mr Thomas, there being, so far as I am aware, no evidence at all that Mr Thomas ever signed any form of that document.
14. The submission for Mr Thomas, put forward by Mr Higgins, is a very simple one. When one looks at the CPR, CPR 32.16 provides:

"An affidavit must comply with the requirements set out in Practice Direction 32."

When one looks at Practice Direction 32, ("PD32"), paragraph 5, it provides as follows:

5.1 The jurat of an affidavit is a statement set out at the end of a document which authenticates the affidavit.

5.2 It must:

(1) be signed by all deponents,

(2) be completed and signed by the person before whom the affidavit was sworn, whose name and qualification must be printed beneath his signature,

(3) contain the full address of the person before whom the affidavit is sworn, and

(4) follow immediately on from the text and not be put on a separate page."

There is before the Court no evidence, and there is unlikely to be any evidence, that this document was signed by Mr Thomas, who is the deponent and, therefore, it does not comply with para 52(1) of PD32. In the circumstances, Mr Higgins says this is not an affidavit.

15. It is common ground between the parties that, although the CPR makes express provision for committal for making a false statement in a document verified by a statement of truth (see CPR 81.17), it does not expressly deal with making a false statement in an affidavit, but that it is well established that to knowingly swear a false affidavit is a matter which can be brought before the Court on committal. That is referred to in the notes in the White Book at 81.17.3, which says this:

"Where the ground of contempt alleges that the respondent knowingly swore a false affidavit, r. 32.14 does not apply and the procedural rules in Section 6 of Part 81 (rr. 81.17 and 81.18) including the provisions as to permission in r. 81.18 (which include the obligation to obtain the permission of the court dealing with the proceedings before the making of an application) do not apply to a committal application made on that ground. As knowingly swearing a false affidavit may be classified as contempt in the form of interference with the due administration of justice, presumably the procedural rules in Section 3 of Part 81 (rr. 81.12 to 81.14) would apply in such circumstances, including the provisions as to permission in r. 81.12. However it has been held at first instance that an application to commit a respondent for knowingly swearing a false affidavit falls, not only outwith the scope of Section 6, but outwith the scope of Part 81 altogether, with the result that neither the provisions in Section 6, or in Section 3 apply, including provisions imposing conditions to be satisfied before an application for permission to apply for committal is made (International Sports Tours Ltd v Shorey [2015] EWHC 2040 (QB), Green J.)"

I was told, in fact, in this case, the question of whether permission was required to bring a committal on this ground was raised before Henderson J. He ruled it was not and in those circumstances, that matter is res judicata between the parties and Mr Higgins has not sought to re-open it.

16. However, it does raise the issue as to whether the document is an affidavit or not, it being accepted by Mr Watson that if the document is not an affidavit, Mr Thomas cannot be committed for knowingly swearing a false affidavit. Indeed, I was shown a transcript from a post-judgment discussion on 27 July in which Henderson J is recorded as saying:

"Mr Watson accepted that he would actually have to show the so-called unsworn affidavit had to have been sworn if he was to maintain that ground."

Mr Watson's position is that it is sufficient in order for a document to be an affidavit that it is sworn by the deponent and the failure to comply with the practice direction, para 5.2 of PD32, although it may be a breach of the Practice Direction and may make the affidavit defective, does not make it not an affidavit.

17. Various other matters were canvassed before me but it does seem to me that all I have to decide on this question is a very short point of law, which is whether a document which has been sworn - it being accepted that there is evidence that the document was sworn by Mr Thomas (although I am not to be taken, by any means, as deciding whether that evidence will at the hearing be sufficient to discharge the burden of proof on the applicant on that question of fact) but on the basis that it is at least possible that the applicant will be able to establish the document was sworn by Mr Thomas - but which has not been signed by the deponent – on the basis that the applicant is unable to establish that the document was signed by Mr Thomas - whether such a document is or is not an affidavit.
18. I have not been referred to any authority on the point. Mr Higgins makes the point that committals need to be established to a criminal standard and technicalities have to be complied with. He says, in circumstances where it is said in CPR 32.16, that an affidavit must comply with the requirements set out in PD32, and it does not comply with all those requirements, it is not an affidavit and, therefore, no committal can be taken forward on the basis of it.
19. Mr Watson initially submitted that, historically, there had been no need for an affidavit to be signed at all but, on my asking to be shown what the RSC said about affidavits, accepted he had been wrong about that. I was shown an extract from the Supreme Court Practice at a time when the RSC was still in force. Order 41 r 1, dealt with the form of an affidavit, and r 1(8) provided:

"Every affidavit must be signed by the deponent and the jurat must be completed and signed by the person before whom it is sworn."

Nevertheless, his submission is that what made the document into an affidavit was the fact of swearing the oath, and failure to comply with other requirements, even though mandatory, did not mean the document was not an affidavit. He referred me to the glossary definition in the CPR of affidavit which provides that "affidavit" means a written, sworn statement of evidence, although one cannot place much reliance on the glossary in the CPR because of the opening words which provide:

"This glossary is a guide to the meaning of certain legal expressions as used in these Rules but it does not give the expressions any meaning in the Rules which they do not otherwise have in the law."

This means one is thrown back on what the meaning is of an affidavit under the general law. On that, I was given very little assistance. Mr Watson did show me a dictionary definition from the Concise Oxford Dictionary which simply provided that an affidavit was a written statement confirmed by oath or affirmation for use as evidence in court but that seems to me to be a slender basis on which to decide what the requirements are of an affidavit.

20. I prefer to rest my decision on the basis that Mr Watson is right that it cannot be the case that failure to comply with every requirement in PD32 means the document is not an affidavit. Suppose, for example, one of the requirements in paragraph 4 was not complied with (that is that the affidavit must, if practicable, be in the deponent's own words, the affidavit should be expressed in the first person and the deponent should do various things, including giving his occupation or, if he has none, his description, and stating if he is a party to the proceedings or employed by a party to the proceedings) or of paragraph 6 of the Practice Direction, which says among other things that an affidavit should be produced on durable quality A4 paper with a 3.5cm margin. It is entirely apparent that some of the requirements of the Practice Direction are such that it cannot sensibly be supposed that failure to comply in every particular respect with them meant that the document was not an affidavit.
21. What, then, is the essential nature of an affidavit? It does seem to me that the essential nature of an affidavit is that it is evidence which is not only given by a deponent but which the deponent has not only stated to be true but has sworn to be true. That, indeed, is, no doubt, the origin of the word "affidavit" which, coming from a Latin expression which incorporates the idea of an oath, refers to swearing that the statement is true. The practice on taking an oath in respect of an affidavit is that the deponent has to appear in person before a Commissioner for Oaths and swear on the Bible or other holy book in front of the Commissioner for Oaths that the affidavit is true.
22. I asked Mr Watson for the form of words used but he was unable to supply it to me. The general nature of the oath is however a familiar one. It does seem to me the essential nature of an affidavit is written evidence which is sworn by the deponent to be true, as opposed to written evidence which is merely stated to be true. If, therefore, it can be established that a deponent has sworn that the evidence contained in the document is true, that seems to me to make the document an affidavit. It is true that if it does not comply with all the requirements of the Practice Direction, it may be a defective affidavit. Para 25 of PD32 says that where an affidavit does not comply with Part 32 or this practice direction in relation to its form, the court may refuse to admit it as evidence. But para 25.2 says that permission to file a defective affidavit or witness statement or use a defective exhibit may be obtained from a judge in the court where the case is proceeding, which proceeds on the basis that a document may be an affidavit, albeit a defective one, and that the court then has a discretion as to whether to admit it or not.
23. Para 5 of PD32 itself, which says what the jurat is, does not say that failure to complete the jurat means the document is not an affidavit. What it says is that the jurat is a statement which authenticates the affidavit and that does seem to me to be the purpose of a jurat. It is to provide a guarantee of authenticity that the oath has, in fact, been administered and that the document has been accepted by the deponent as being his affidavit. That is why it requires not just the Commissioner for Oaths but the deponent to sign it because in that way it not only authenticates by the signature of the Commissioner for Oaths that it has been sworn to but authenticates by the deponent that he has sworn to it. But it does seem to me that the very form of para 5.1 indicates that what makes the document the affidavit is not the jurat but the oath which precedes it.
24. In those circumstances, in my judgment, a document which sets out a witness's evidence which the witness has sworn to be his evidence is, in technical terms. an affidavit. If it is demonstrated, to the requisite standard, that he has knowingly sworn an affidavit which he knows to be false, then he is liable to committal for knowingly swearing a false affidavit and the fact that he has failed, having sworn the document, to sign the jurat as required by para 5.2 of PD32, does not mean that he is not liable to committal or that the document he has sworn is not an affidavit. I, therefore, will allow Ground 1 to go forward to a hearing on the basis that it will be for the applicant to establish to the requisite standard that Mr Thomas did swear this document such as to make him amenable to be committed if he knowingly swore it, knowing it to be false.
25. Ground 2 raises a completely different question. Ground 2 alleges breaches of the freezing order. It will be recalled, that as a result of Henderson J's judgment of 22 July the freezing order was, in practice, ineffective in relation to assets of Mr Thomas's outside England and Wales. Ground 2 alleges breaches of the part of the freezing order which restrained Mr Thomas from removing from England and Wales any of his assets which are in England and Wales or in any way disposing of, dealing with or diminishing the value, of any of his assets in England and Wales.
26. The essential allegation is that in July 2007, Mr Thomas procured that a company called Company C, which is a Canadian company, should acquire a company called Company D, which is a German company, and which I will refer to as "the German company" (its name is V Consulting Group Europe GmbH), it being alleged that Mr Thomas had an interest in the Canadian company which came to own the German company. He then, it is said, appointed himself sole director of the German company and arranged for a German bank account to be set up with a bank in Munich.
27. Then on 7 August 2007 he entered into a Consultancy Agreement with an English company on behalf of the German company. That Consultancy Agreement I was shown. It is dated 7 August 2007. It is made between Vodafone Group Services Limited, an English company, with a place of business in England, and the German company, V Consulting Group Europe GmbH. Mr Thomas personally is also a party to the Consultancy Agreement but a recital indicates that the reason he entered into the agreement was to give Vodafone the benefit of two clauses, clauses 11 and 12, which deal with restrictions after termination and the ownership of intellectual property rights and inventions respectively and do not seem to me to take the matter any further for present purposes.
28. The Consulting Agreement, in short, is one under which the German company agrees to provide the services of the Consultants to Vodafone. One of the Consultants is Mr Thomas and the provisions for payment provide that Vodafone is to pay the German company certain monies for the services of the Consultants, which are calculated in Euros. There is one extra provision of some potential importance which is schedule 2, which sets out the name of the Consultants, who are called the Original Consultants, and includes under Mr Thomas's name a commencement date of 23 May 2007, that is some two and a half months before the Consultancy Agreement was entered into. Clause 8.4 provides this:

"In the case of the provision of the services of relevant Consultants whose services have been provided before the date of this agreement, schedule 4…"

(which seems to be an error for, in fact, schedule 6)

"…sets out a calculation of the amounts owed in respect of this engagement from the relevant commencement date up to and including the date of this agreement. It is acknowledged and accepted that such amounts were the subject of an initial reconciling invoice from V Consulting to VGSL. The invoice should be raised on the basis of the calculation set out in schedule 6 immediately following the signature of this agreement."

Schedule 6 deals with only one person who is, in fact, Mr Thomas and it sets out fees due in respect of his services as a Consultant for the period from his commencement date to 3 August 2007 (that is from 23 May 2007 to 3 August 2007), detailing 55 days at a daily rate of €1,845 a day, together with various expenses and a flight, making a total amount of €124,207.06. It is alleged in the reformulated grounds that an invoice in that amount was sent to Vodafone.

29. This is paragraph 17 of the reformulated grounds and this is what is said by the applicant:

"17. VGSL is a company registered and located in England and Wales. The Consultancy Agreement was an English contract…"

(I interpose to say that is true in the sense that the Consultancy Agreement provides that it was deemed to have been made in England and should be governed in all respects by English law)

"…and the remuneration including expenses due to the first respondent thereunder amounted to receivables that constituted assets in England and Wales.

18. In arranging through the use of the Vodafone invoices for the entire sums representing the said receivables to be transferred out of England and Wales on each occasion he raised a Vodafone invoice, the first respondent was in breach of paragraph 4.1 and paragraph 7.2 of the FO."

There is then, at paragraph 19, set out all the invoices, the first of which is the invoice for €124,000 odd, relating to the period up to 3 August 2007.

30. Paragraph 20 continues:

"Any or all of the above transfers of funds…"

which I should say continue down to a date in October 2011:

"…carried out at the request of the first respondent represent a separate contempt of court and must give rise to a ground for committal.

21. Further or alternatively, in entering into the Consultancy Agreement in the first place in the terms that he did designed in order to remove the receivables payable under or in reference to the Consultancy Agreement from England and Wales, the first respondent was dealing with his assets in breach of paragraph 4.2 of the FO."

Then 22 adds:

"22. In addition, or in the further alternative, the first respondent arranged matters in this way through the use of company D and the Consultancy Agreement/Vodafone invoices in order to hide his assets and his dealings with them from both the applicant and the court, thereby intending with some considerable success to put them beyond the reach of his creditors."

I will say straightaway that paragraph 22 does not seem to me to allege a separate breach of the freezing order. It may or may not be an allegation of a fraudulent disposition of assets to the prejudice of creditors but that is not what the committal application is concerned with. The committal application is concerned with breaches of the freezing order and, in particular, that paragraph of the freezing order which restrained Mr Thomas from dealing with, to use a compendious expression, his assets in England and Wales.

31. It can be seen, going back to paragraph 17, that the essential allegation is that the remuneration under the Consultancy Agreement was due to the first respondent, Mr Thomas. One can see that if he personally was entitled to remuneration in England and he arranged for it, instead, to be paid to a company in Germany, that might well amount to a dealing with or a disposal of his assets, namely his right to remuneration. The difficulty I have, however, is that the allegations which are in the reformulated grounds and the material which I have seen in the form of the Consultancy Agreement do not seem to me to make any remuneration payable to the first respondent, Mr Thomas, personally. Instead, as Mr Higgins submitted, the Consultancy Agreement is in a perfectly straightforward and understandable form in which the German company makes available to Vodafone the services of certain individuals in return for payments due to the German company.
32. Mr Watson said Mr Haederle's case was that Mr Thomas had arranged matters in this way precisely so as to prevent monies being payable to Mr Thomas personally, and it was all, in effect, designed to get around the freezing order. That may or may not be so but the question is whether there is a reasonably arguable case that the payment of monies under the Consultancy Agreement amounted to a dealing with assets belonging to Mr Thomas which were English assets, and since under the Consultancy Agreement, Mr Thomas was not entitled to any claim against Vodafone for their services, and the contractual entitlement to payment was instead with the German company, I do not see that the payment by Vodafone to the German company of the invoices which were rendered after the date of that agreement, for services provided under that agreement, could reasonably be said to amount to dealing with any of Mr Thomas's assets at all, whether within or without England and Wales.
33. In argument, Mr Watson suggested that the monies received under the Consultancy Agreement might be held on trust by the German company for Mr Watson but that is not one of the allegations made in the reformulated grounds. I see great difficulty in establishing that in any event. He also suggested it might be possible, if necessary, to pierce the corporate veil and treat the German company as if it was the alter ego of Mr Thomas. Again, that is not, as I read the reformulated grounds, one of the allegations that are made and I say nothing as to whether it might or might not be possible to pierce the corporate veil in that way. That is not the basis upon which this application seems to me to have been brought. With one possible exception, which I will have to look at in a moment, it seems to me, as formulated, that this allegation, that the remuneration payable under the Consultancy Agreement was in truth remuneration payable due to the first respondent, is one that there is no reasonable prospect of making out and is not one that should be allowed to go forward for hearing.
34. Mr Watson said it was Mr Thomas who was providing the services and, prima facie, he was entitled to be paid for the services. No doubt, that might have been the case had there been no such contract but given that Mr Thomas caused the German company to contract with Vodafone on terms that the German company would make Mr Thomas's services available in return for payment to the German company, I do not think there is before the Court any evidence to support the allegation that the remuneration due under the Consultancy Agreement was a receivable which was due to Mr Thomas personally.
35. I said there was one exception and it does seem to me that rather different considerations apply to the reconciling invoice of €124,000. As is apparent from the form of the Consultancy Agreement, this was a payment which was made in accordance with the terms of the Consultancy Agreement in respect of services which, by the date of the agreement on 7 August 2007, had already been provided by Mr Thomas to Vodafone.
36. I asked Mr Watson if it was known on what terms those services had been provided but he was not able to give me an answer but I accept that, on the face of it, Mr Thomas had provided 55 days' worth of consulting to Vodafone before he caused the German company to enter into this contract on 7 August; that in the absence of any other explanation, Mr Thomas would be entitled to payment for his services, it not being suggested he was ever intended to provide services to Vodafone for free; and that in the absence of any other contractual arrangement, he would be entitled personally to be paid a quantum meruit for the services which he had provided. In those circumstances, it does seem to me there is an arguable case fit to go forward for a hearing on that point.
37. The question whether, when Mr Thomas caused Vodafone to agree to pay the German company for the 55 days of services which he had already provided to them, he was, thereby, disposing of remuneration that would otherwise have been due to him personally, and due to him personally in England, does seem to me to raise arguable grounds. I say nothing as whether it will be possible for the applicant to make that allegation out to the requisite standard. It appears to me to be encompassed within the allegations that are made because there is an allegation that the remuneration under the Consultancy Agreement was remuneration due to the first respondent which amounted to receivables, constituting assets within England and Wales and in arranging for that to be paid to the German company, including the €124,000, Mr Thomas was in breach of the freezing order.
38. I, therefore, will allow Ground 1 to go forward on the basis that, in my judgment, if it can be shown that Mr Thomas did swear to the truth of the document which I have called the second affidavit, then it is possible to form the basis of Ground 1. I will allow Ground 2 to go forward, limited to the allegation in respect of the €124,000 invoice for services already rendered prior to the date of the Consultancy Agreement but not in relation to the invoices payable under the Consultancy Agreement for services rendered on and after that date.

Later

39. This is a pre-trial review, as I said in my judgment. The respondent has, effectively, although without issuing any formal application, taken two preliminary points in an attempt to strike out the entire committal proceedings. The respondent has had some notable success in cutting down the scope of Ground 2 very significantly but has not succeeded in getting rid of the entirety of Ground 2, and has failed on Ground 1. In those circumstances, the question arises, which party is the successful party. I take the view neither party can claim to be the successful party overall.
40. Both parties have had a considerable degree of success and I agree with Mr Watson that if one was adopting an issue based approach, one would say that, insofar as the respondent has succeeded on Ground 2 to the extent he has and, therefore, ought to have the costs of issue 2, the applicant has succeeded on Ground 1, together with a small amount of Ground 2, and thereby kept his committal application alive, and ought to have the costs of issue 1. I accept Mr Watson's initial thoughts, that the most cost efficient and sensible way of proceeding in those circumstances is to make no order for costs rather than to require the parties to go through the exercise of assessing their costs of part of the hearing and setting one off against the other and I will, therefore, make no order as to costs of today. I will reserve all previously reserved costs to the hearing of the substantive application to commit.