BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
INSOVLENCY AND COMPANIES LIST (ChD)
IN THE MATTER OF PROSPECT PLACE (WIMBLEDON) MANAGEMENT COMPANY LIMITED
AND IN THE MATTER OF THE COMPANIES ACT 2006
London, EC4A 1NL |
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B e f o r e :
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LILY PROPERTY NOMINEES LIMITED GURUPARAN CHANDRASEKARAN |
Petitioners |
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- and - |
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(1) WILLIAM GEORGE STONEBRIDGE (3) RUTH VOGT (4) PAUL JOHAN VOGT (5) RICHARD MICHAEL JOSEPH (6) PROSPECT PLACE (WIMBELDON) MANAGEMENT COMPANY LIMITED |
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Richard Samuel (instructed by Peacock & Co) for the Respondents
Hearing dates: 2nd to 6th March 2020
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Crown Copyright ©
Insolvency and Companies Court Judge Burton:
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Paragraph No. |
Introduction | |
The Company and its constitution | |
The Deed of Covenant | |
The Petition | |
Incidents giving rise to the Petition | |
Relief sought | |
The Respondents' defence | |
The Company's counterclaim | |
Open Offers | |
Legal framework | |
The role of equity and its intervention in this case | |
Witnesses | |
Analysis of incidents said to give rise to the Petition: · Refusing to issue B share, wrongfully demanding management fee · Gardener · Gate entry system · Barking dog · JCF, directorships and mother's parking introduction § Failure to consult re JCF appointment § Failure informally to invite appointment to the board § Asking mother to park outside Prospect Place · Mr Stonebridge's behaviour · The AGMs |
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Conclusion regarding the Petitioners' claim | |
Decision on the Counterclaim |
Introduction
The Company and its constitution
"To undertake the control management repair and administration of the said land and other facilities and to collect rent service and maintenance charges and income from the owners and/or occupiers of the said dwellinghouses and in connection therewith to engage and employ such servants, agents, builders, engineers and other person as the Company may consider necessary in its absolute discretion to provide such services and to pay all rates taxes insurance premiums and other outgoings costs and expenses or otherwise in relation to the said land".
Name |
Date appointed |
Date resigned |
Peter Beckwith |
07.09.1999 |
21.06.2016 |
Paul Vogt |
07.09.1999 |
- |
David Birley |
01.01.2001 |
16.03.2016 |
Cynthia Hipps |
07.04.2016 |
25.11.2016 |
William Stonebridge |
07.04.2016 |
- |
Richard Joseph |
05.03.2018 |
24.09.2018 |
The Deed of Covenant
"(3) This Deed is entered into in order to give effect to the agreed scheme for the management maintenance and repair of Prospect Place Wimbledon London SW20 and ancillary motorised gates and lighting and adjoining landscaped areas".
"a) a series of positive covenants
(i) to maintain the land it owns (Prospect Place and the grass verges) and the structures on it;
(ii) to enforce the provisions of the Deeds against other homeowners; and
b) a series of negative covenants, of which the following are relevant:
i) not to allow to be done on any part of Prospect Place or the Communal Landscaped Areas anything which does or may be or may grow to be a nuisance or annoyance to any other occupier of [the eight houses]; and
ii) not to 'allow any car or cars to be parked in any part of [the private road] or in such positions that they project onto or overhang [the private road] "
The Petition
"as far as the Petitioners are aware, the Company has always been run on the following basis and understanding ("the Understanding"):
i) That all the owners from time to time of the 8 Properties would be consulted by the Company on material matters concerning the management of the Company's Land;
ii) To the extent that vacancies became available on the board of directors, that the owners from time to time of the 8 Properties would each be fairly considered by the existing directors of the Company for appointment and would be informally approached and then appointed as directors if they so desired;
iii) That the members of the Company would ensure that the Company was run fairly and in good faith as regards all the other members of the Company from time to time having regard to the residential use of the eight Properties and the reasonable expectation in the owners and occupants that they would peacefully use and enjoy their properties and would themselves be treated equally and fairly."
"Further and in any case, the Petitioner and the Chandrasekarans were entitled to expect all members and those who were appointed as directors of the Company from time to time to maintain a standard of fair dealing and fair play with regard to the running of the Company which would have included acting in accordance with the matters comprising the Understanding set out above".
i) to exercise his powers for a proper purpose and in accordance with the Company's constitution (section 171);
ii) to promote the success of the Company pursuant to section 172;
iii) to exercise independent judgment pursuant to section 173;
iv) to exercise reasonable skill, care and diligence pursuant to section 174;
v) to avoid placing himself in a position of conflicting personal interests pursuant to section 175; and
vi) to declare an interest in any proposed transaction or arrangement exercise independent judgement pursuant to section 176.
"It is to be inferred from the matters set out in this Re-Amended Petition that the [Respondents] have adopted a policy in the manner that they have managed the Company aimed at not only diminishing the Chandrasekaran family's quality-of-life but of causing them to sell 7PP or otherwise leave the property".
Incidents giving rise to the Petition
"Mr and Mrs Chandrasekaran initially leased 7PP in 2010 before the property was acquired by the Petitioner in 2016. Following this acquisition, the Company wrongfully refused to acknowledge the Petitioner's entitlement to be issued with a 'B' share and wrongly demanded that it pay management fees relating to the period preceding its acquisition of the property. Further, the Company aggressively and abusively pursued this argument including in an email sent on 3 February 2016. A letter was sent by the Company apparently rowing back from this position later in February 2016. This recognised the Petitioner's entitlement to the 'B' share and that the management fee claimed was not due. It also apologised and retracted the "offensive" email of 3 February 2016, offered £500 towards legal costs and gave the following undertaking: "in our future conduct we will treat you fairly and equitably, just the same as we would any other shareholder of Prospect Place".
i) The gardener
The directors failed, in May 2018, when Mr Chandrasekaran asked them to do so, to take suitable steps to terminate the contract of a gardener. Mr Chandrasekaran had complained that the gardener had racially slurred him in February 2016. The gardener's continued presence on the Company's land caused the Chandrasekaran family discomfort, "compounded by the Chandrasekarans' knowledge that those in control of the Company prefer to support an individual accused of racism than the persons the Company was designed to serve".
ii) Mr Stonebridge's behaviour
The Petition cites various incidents when the First Respondent, Mr Stonebridge, allegedly acted in an intimidating and physically threatening manner towards Mr Chandrasekaran which, it is said, comprised attempts to harass the Chandrasekaran family including:
a. Mr Stonebridge visiting 7PP without notice on 2 January 2017 when he rang the bell and banged so violently on the glass surrounding the front door of 7PP that it frightened the Chandrasekarans' then seven-year old daughter;
b. several incidents from September 2017 when Mr Stonebridge is said to have stared aggressively at Mr Chandrasekaran, sometimes in the presence of Mr Chandrasekaran's children, on one occasion using foul language whilst shouting at Mr Chandrasekaran in front of the drive to 7PP and on another occasion putting his face right up to Mr Chandrasekaran's in a threatening and intimidating manner as if he were going to strike him; and
c. Mr Stonebridge taking to "pointedly engaging" Mr and Mrs Chandrasekaran's young children in conversation when they were playing in the front garden of 7PP. "This is something that he has not previously done. It is not welcome conduct and is a form of intimidation".
The Petition states that a number of the incidents had been raised in correspondence but not accepted or appropriately handled by the Company. "The Company's failure to address the issues compounds the actual problem itself and makes it a continuing source of discomfort for the family".
iii) Double standards
Examples in the Petition of incidents which the Petitioners claim demonstrate that the Company discriminated against the Chandrasekaran family by adopting double standards include:
a. Parking: the Company strictly enforcing no-parking areas on the Company's land against the Chandrasekarans and their guests whilst regularly tolerating occupants of the other properties and their guests or contractors parking on the Company's land. Of particular relevance here, as will be seen, is an event when, according to the Petition, Mr Stonebridge told Mr Chandrasekaran's elderly mother that she was not allowed to park on Prospect Place, even though she was intending to park on 7PP's private drive. This resulted in her parking outside the gates, on the main road and having to walk up to 7PP laden with bags of food and books which she had brought for the Chandrasekaran family's children. The Petition states: "As with other matters, rather than react appropriately when this matter was complained of in correspondence, those running the Company adopted a combative, offensive and incorrect attitude, suggesting that any adverse treatment of her (none being admitted) can possibly amount to unfair prejudice of the required kind".
b. Appointment of JCF: Failing to consult Mr and Mrs Chandrasekaran on important decisions concerning its business. The Petition alleges that the Company appointed JCF Property Management Ltd as managing agents after consulting other Prospect Place homeowners but without putting the appointment out to tender and without consulting Lily or Mr or Mrs Chandrasekaran;
c. Barking dog: Ignoring legitimate complaints raised by the Chandrasekaran family for example in late 2016 with regard to the late-night barking of a dog left in the garden of one of the properties neighbouring 7PP which caused a nuisance and annoyance to Mr Chandrasekaran's son who was recuperating at home from a critical illness and recent hospitalisation; and
d. Garden waste: In November 2017, the Company falsely informing the council's refuse collector not to take away 7PP's garden waste because it had not been paid for.
iv) Instructing contractors not to cooperate with Mr and Mrs Chandrasekaran
DS Systems Ltd was overseeing a proposed upgrade to an intercom and gate system and carrying out related works to 7PP. The petition alleges that DS Systems Ltd were told not to cooperate with Mr and Mrs Chandrasekaran. It states that the interference blocked the proposed upgrade of the system causing expense and delay to the works the Chandrasekarans were undertaking at 7PP and that those controlling the Company misreported and exaggerated the likely cost of the upgrade "apparently motivated by a desire to undermine Mr Chandrasekaran rather than because the same was in the interests of the residents and, in fact, indicated a preparedness to damage the interests of members to this wrongful end".
v) Blocking an upgrade to the gates
The Petition claims that the Company also blocked a proposed upgrade to the gate system for which Mr Chandrasekaran had indicated he was prepared to pay: "this was clearly against the interests of the members and residents. The gates remain faulty and has caused great inconvenience to all residents and amounts to a potential health and safety issue".
vi) Instructing the Company's solicitors to adopt a hostile and defensive attitude
The Petition states that many of the matters summarised at (i) to (v) above have been repeatedly raised in correspondence but rather than adopting an appropriately conciliatory and constructive tone, those in control have replied via the Company's solicitors and "instructed them to adopt a hostile and defensive attitude completely out of keeping with the fair manner in which they should be managing the Company". This, it is said, indicates bad faith towards the Petitioners.
vii) Double standards in corporate governance matters The Petition claims that in marked contrast with their dealings with other residents, those in control of the Company adopted a formal, overly strict and at times incorrect attitude to Mr and Mrs Chandrasekaran regarding corporate governance matters. In particular:
a. Directorship vacancies: the Respondents wrongly failed to consider or invite Lily or Mr or Mrs Chandrasekaran to become directors of the Company, despite vacancies arising. They also wrongly denied in correspondence that Mr Chandrasekaran qualifies for appointment (despite Mr and Mrs Chandrasekaran being beneficial owners of 7PP). By contrast, in the past, other property owners have been informally approached and within the last 12 months, the Fifth Respondent, Mr Joseph was appointed before he even moved into his property and a Mr Beaumer was approached with a view to appointment, even though he had only lived on the estate for just over a year.
b. Denying a claim under section 994: The Respondents wrongly denied in correspondence that the allegations levelled against the Company and the Respondents were capable of justifying a claim under section 994 CA06. Mr and Mrs Chandrasekaran beneficially own 7PP, live there with Lily's consent and their treatment is therefore to be treated as the treatment of the Petitioner.
viii) 2018 AGM The Petition claims that the Respondents breached their duty to inform members at the AGM held on 27 November 2018 of the Petitioners' threatened litigation and that "This indicates that the directors of the Company are not proposing to address the Petitioners' concerns at all let alone fairly".
Relief sought
i) An order that the Company should invite Mr Chandrasekaran to act as a director and duly appoint him as such;
ii) An order requiring the Company to consult the Petitioner and Mr and Mrs Chandrasekaran on any spending decisions that are likely to result in the Company paying more than £300;
iii) An order that the Company, through its directors, should give reasonable and fair consideration to one of Mr and Mrs Chandrasekaran being appointed as a director whenever the Company is considering the appointment of a new director, assuming that neither of them has already been appointed;
iv) An order that the Company should be run in good faith and fairly in the interests of all the occupants from time to time of the 8 properties at Prospect Place and act in accordance with the rights granted to those owners over the company's land including rights of access to and egress from their properties; or
v) Such other order as may be made as the Court thinks fit.
The Respondents' defence
i) the mowing of the front lawn in 2012 (which took place before the First Petitioner bought 7PP);
ii) the alleged racial slur of the gardener in February 2016 (at the time the gardener was not employed by the Company but by Mr Birley who then lived at 3PP)
iii) the Company's failure to do anything about the barking dog;
iv) the refusal of the local authority's refuse collector to collect 7PP's garden waste in November 2017; and
v) the allegations against Mr Stonebridge of harassment. The Respondents claim that they do not concern his directorship or an act or omission of the Company.
The Company's counterclaim
Open offers
Legal framework
"A member of a company may apply to the court by petition for an order under this Part on the ground:
a. that the company's affairs are being or have been conducted in a manner that is unfairly prejudicial to the interests of the members generally or of some part of its members (including at least himself), or
b. that an actual or proposed act or omission of the company (including an act or omission on its behalf) is or would be so prejudicial.
i) the conduct complained of must consist of the conduct of the company's affairs or an "act or omission of the company (including an act or omission on its behalf)", and
ii) the petitioner's interests (or those of the company's shareholders generally) as a member must have been,
iii) prejudiced,
iv) unfairly.
"It is not necessary for the petitioner to be able to show a course of conduct nor one that is continuing at the date of the petition: an isolated past act or omission is sufficient to give the court jurisdiction to intervene, although the court will of course take into account in the exercise of its discretion the extent to which the prejudice relied upon by the petition is continuing and has been suffered, or is likely to be suffered by the petitioner. The court will in this context have regard to the substance and practical realities of the business arrangements: Oak Investment Partners XII v Broughtwood [2009] 1 BCLC 453".
Conduct of the affairs of, or act or omission by, the company
"The section is not directed to the activities of shareholders amongst themselves, unless those activities translate into acts or omissions of the company or the conduct of its affairs. Relations between shareholders inter se are adequately governed by the law of contract and tort, including where appropriate the ability to enforce personal rights conferred by a company's articles of association".
"The words "affairs of the company" are extremely wide and should be construed liberally: (a) in determining the ambit of the "affairs" of a parent company for the purposes of s320, the court looks at the business realities of a situation and does not confine them to a narrower legalistic view; (b) "affairs" of a company encompass all matters which may come before its board for consideration; (c) conduct of the "affairs" of a parent company includes refraining from procuring a subsidiary to do something or condoning by inaction an act of a subsidiary, particularly when the directors of the subsidiary and the parent are the same
I would accept these propositions, but with some qualification. Proposition (b) may extend to matters which are capable of coming before the board for its consideration, and may not be limited to those that actually come before the board: I do not accept that matters that are not considered by the board are not capable of being part of its affairs".
The petitioners' interests as a shareholder
"It is somewhat unreal to deal with the capacity in which prejudice was suffered in these respects where there was no entitlement in law or equity in the first place. But assuming there had been a contractual obligation, I would not exclude the possibility that prejudice suffered from the breach of that obligation could be suffered in the capacity of shareholder. As cases like R & H. Electrical Ltd v Haden Bill Electrical Ltd [1995] 2 BCLC 280 show, the requirement that prejudice must be suffered as a member should not be too narrowly technically construed."
"the interests of a member are not necessarily limited to his strict legal rights under the constitution of the company".
The case concerned an application to strike out the petition. The petitioners were husband and wife. They alleged that the respondents had represented that if the petitioners sold their shares in the company to them, they would make a substantial investment in the business and, inter-alia, employ the husband as managing director of the company as well as permitting him to join the board of the respondent company. The petitioners alleged that the representations were false. The respondent company had no funds to invest in the company and the petitioners argued that they had lost the benefit of the husband's salary under his service contract and the prospect of dividends from the shares in the respondent company (which they said were worth little or nothing). The principal ground for the application to strike out was that most of the matters of complaint constituted wrongs done to the petitioners in their capacity as defrauded vendors of the shares in the company or to the husband as a wrongfully dismissed employee of the company. Quoting Lord Wilberforce in Re Westbourne Galleries Ltd & Ors [1973] AC 360, Hoffmann J said:
" a limited company is more than a mere legal entity, the personality in law of its own: that there is room in company law for recognition of the fact that behind it, or amongst it, there are individuals with rights, expectations and obligations inter se which are not necessarily submerged in the company structure."
He continued:
"I bear in mind that Lord Wilberforce added that in most companies and in most contexts, whether the company was large or small, the member's rights under the articles of association and the Companies Act could be treated as an exhaustive statement of his interests as a member. He mentioned various features typically present in cases in which further equitable considerations might arise: a personal relationship between shareholders involving mutual confidence, an agreement that some or all should participate in the management and restrictions upon the transfer of shares which would prevent a member from realising his investment."
Hoffmann J found there to be "much force" in the respondents' submissions that it was not a case in which one should look beyond the petitioners' interests as members of the company as defined by the articles of association. He nevertheless decided not to strike out the petition:
"Section 459 operates within so potentially wide a frame of reference and gives the court so broad a discretion that I do not think that I can say that no evidence which the petitioners might bring in support of the petition could satisfy a court at the hearing that Mr S's employment as a director of A Limited was not in all the circumstances part of his legitimate expectancy as a member of O plc".
Prejudice
Unfairness
"The test of unfairness must, I think, be an objective, not a subjective one. In other words it is not necessary for the petitioner to show that the persons who have had de facto control of the company have acted as they did in the conscious knowledge that this was unfair to the petitioner or that they were acting in bad faith; the test, I think, is whether a reasonable bystander observing the consequences of their conduct, would regard it as having unfairly prejudiced the petitioner's interests".
"Although fairness is a notion which can be applied to all kinds of activities its content will depend upon the context in which it is being used. Conduct which is perfectly fair between competing businessmen may not be fair between members of a family. In some sports it may require, at best, observance of the rules, in others ("it's not cricket") it may be unfair in some circumstances to take advantage of them. All is said to be fair in love and war. So the context and background are very important".
The role of equity and its intervention in this case
"In the case of section 459, the background has the following two features. First, a company is an association of persons for an economic purpose, usually entered into with legal advice and some degree of formality. The terms of the association are contained in the articles of association and sometimes in collateral agreements between the shareholders. Thus the manner in which the affairs of the company may be conducted is closely regulated by rules to which the shareholders have agreed. Secondly, company law has developed seamlessly from the law of partnership, which was treated by equity, like the Roman societas, as a contract of good faith. One of the traditional roles of equity, as a separate jurisdiction, was to restrain the exercise of strict legal rights in certain relationships in which it considered that this would be contrary to good faith. These principles have, with appropriate modification, been carried over into company law.
The first of these two features leads to the conclusion that a member of a company will not ordinarily be entitled to complain of unfairness unless there has been some breach of the terms on which he agreed that the affairs of the company should be conducted. But the second leads to the conclusion that there will be cases in which equitable considerations make it unfair for those conducting the affairs of the company to rely upon their strict legal powers. Thus unfairness may consist in a breach of the rules or in using the rules in a manner which equity would regard as contrary to good faith.
This approach to the concept of unfairness in section 459 runs parallel to that which your Lordships' House, in In re Westbourne Galleries Ltd. [1973] A.C. 360, adopted in giving content to the concept of "just and equitable" as a ground for winding up. After referring to cases on the equitable jurisdiction to require partners to exercise their powers in good faith, Lord Wilberforce said, at p. 379:
"The words ['just and equitable'] are a recognition of the fact that a limited company is more than a mere legal entity, with a personality in law of its own: that there is room in company law for recognition of the fact that behind it, or amongst it, there are individuals, with rights, expectations and obligations inter se which are not necessarily submerged in the company structure. That structure is defined by the Companies Act [1948] and by the articles of association by which shareholders agree to be bound. In most companies and in most contexts, this definition is sufficient and exhaustive, equally so whether the company is large or small. The 'just and equitable' provision does not, as the respondents [the company] suggest, entitle one party to disregard the obligation he assumes by entering a company, nor the court to dispense him from it. It does, as equity always does, enable the court to subject the exercise of legal rights to equitable considerations; considerations, that is, of a personal character arising between one individual and another, which may make it unjust, or inequitable, to insist on legal rights, or to exercise them in a particular way."
I would apply the same reasoning to the concept of unfairness in section 459. The Law Commission, in its Report on Shareholder Remedies (1997) (Law Com. No. 246), p. 43, para. 4.11, expresses some concern that defining the content of the unfairness concept in the way I have suggested might unduly limit its scope and that "conduct which would appear to be deserving of a remedy may be left unremedied " In my view, a balance has to be struck between the breadth of the discretion given to the court and the principle of legal certainty".
"44. As that passage makes clear, and as also is apparent from cases such as Re Saul D Harrison & Sons plc [1995] 1 BCLC 14, the concept of unfairness is open-textured; but it is to be applied judicially and must comprise some breach of either the terms on which it was agreed the affairs of the company should be conducted or of equitable constraints which apply to the exercise of legal powers by reason of the nature of the relationship between the parties. As to the latter, the context in which such equitable considerations most regularly arise is that of what is usually referred to (since the seminal speech of Lord Wilberforce in Ebrahami v Westbourne Galleries Ltd [1973] AC 360) as a "quasi-partnership". That useful, but perhaps over-used, phrase is intended to recognise and convey the fact that the relationship between shareholders may be subject to equitable considerations of a personal character which "make it unjust or inequitable to insist on legal rights, or to exercise them in a particular way".
"relied upon along quasi-partnership lines but plays into the general assessment of unfairness. Part substantially overlaps with the rights that existed anyway. The parts concerning the rights to be consulted on material matters and to be fairly considered and brought onto the board if wanted, were policies communicated by those on the board and followed by the Company. Though, and this is the whole point, they were not applied equally to Lily".
Witnesses
i) Paran and Vanessa Chandrasekaran,
ii) Maheswary Chandrasekaran, who is Mr Chandrasekaran's mother;
iii) Jerome Mohamed a technical expert who works with Mr Chandrasekaran and became involved in the discussions regarding Mr Chandrasekaran's dissatisfaction with the gate entry system and a possible upgrade to that system;
iv) David Archer the client relationship partner at Pitmans, solicitors for the Petitioners; and
v) Rachel Constantine, Mr Chandrasekaran's personal assistant.
i) Paul Vogt, the Fourth Respondent,
ii) William Stonebridge, the First Respondent; and
iii) Richard Joseph, the Fifth Respondent, who purchased 3PP from its former owner, Peter Beckwith.
Mr Chandrasekaran
Mrs Chandrasekaran
Mrs Maheswary Chandrasekaran
"I was afraid to cross the people involved in this matter as I was already aware at their distaste toward my family. I was worried not to exacerbate it".
Later, in the same witness statement she said:
"I really feel for their situation very badly. They have been bullied for so long and have kowtowed to all that has been put upon them. Now I fear for the children. I worry about the environment in which they are experiencing all this and the effect it might have on them".
Mr Archer
Ms Constantine
"From my experience and also from working so closely with them I do not see [the Chandrasekarans ] as intemperate in the slightest which I know is something Mr Chandrasekaran has been accused of in the litigation correspondence".
"The C's are a delightful family and I cannot quite understand why having raised legitimate concerns to the board they are being treated in such an unfairly prejudicial manner".
I consider that she engaged openly and honestly with questions put to her.
Mr Mohamed
Mr Vogt
Mr Stonebridge
Mr Joseph
Analysis of incidents said to give rise to the Petition
The Company wrongfully refusing Lily's entitlement to be issued with a B share, wrongly being demanded to pay management fees relating to the period prior to its acquisition of 7PP and the Company aggressively and abusively pursuing this argument including an email sent on 3 February 2016
"No other board member or shareholder replied.
During the period 2010-2016, we had very little interaction with other members of the estate (other than PB). I would often tip my hat or wave at others as they passed, but unless it was PB or his wife, my friendliness was not reciprocated. We are however busy people and I didn't make anything of it at the time."
"I would best describe our relationship during this earlier period as being 'at arm's length neighbours'. WS would respond to my greetings as we passed one another in the common areas, saying something along the lines of 'alright'. As he did reciprocate the wave of a hand or a 'good morning' greeting, and in the context of everyone being quite hostile, I thought it would be helpful to maintain this relationship".
"Whilst we were ignored throughout the duration of our tenancy, matters got worse following the purchase of the Property in January 2016.
Not only have we been treated differently to the other residents, but we have to endure daily stress, anxiety and upset which has had and still has a negative impact on our family and home life. We often feel embarrassed or even harassed and anxious. The motive for acting in this way towards us remains unknown, despite our attempts to reconcile this dispute, but whatever the motive, there is a clear aim to cause us distress".
"I will ask Mr Chandrasekaran [by copy of this email] to let me have his cheque for £750.00 in favour of Prospect Place (Wimbledon) Management Company Limited. This sum is for the service charge for the year from 1 August 2015 to 31 July 2016 which Mr Gallas [7PP's former owner] does not appear to have paid".
"as between Mr Gallas and Mr Chandrasekaran the former is liable for the service charge fee up until 15th January. I believe that new shareholders are only liable for the service charge apportioned from when they acquire ownership. Would you be kind enough to confirm?".
"the Management Company is not concerned as to the apportionment of the service charge made by Mr Gallas and his buyer.
Mr Gallas remains liable under his covenant until released [Clause 2.1]. Lily will be liable for the service charge when it executes the Deed of Covenant".
"I would of course be more than happy to pay our portion of the fees from 15 January 2016 (date of completion). I had been waiting to have confirmation of the formalities of the stock transfer being finalised hence the silence.
If you would be kind enough to tell me how much is owed, then I will promptly make a cheque (my preferred method of payment) out to the relevant party".
"Mr Gallas was asked in October 2015 to pay his share of the current year's service charge by 31 January 2016.
[illegible] noted that before your company bought 7 Prospect Place no enquiries were made either by yourself or your Solicitors of Prospect Place (Wimbledon) Management Company Limited, and it is further noted that you have lived in 7 Prospect Place for some time past.
If your suggestion that you should only pay the outstanding service charge from 15 January 2016 is adopted, this Company will be left to seek the balance from Mr Gallas at a cost which will fall on the shareholders.
If the service charge for 7 Prospect Place is not paid in full the Directors will have to report this fact to the other shareholders before the next AGM and Mr Gallas's, your company's and your names will be mentioned.
I feel sure that you do not want your neighbours to have a bad impression of you.
If however you decline to pay the service charge in full would you or your Solicitors draft a form of words to explain your decision which the Directors will consider".
"Dear David,
Thank you for your email and for the parts which furnish me with the information I have for so long wanted.
The remainder of the email, is in any view, ill-judged, hurtful to say the least and of course menacing and attempts to intimidate. I understand you are a solicitor. I am responding to it in the absence of legal advice. I am writing more in sorrow than in anger but please note that I am no shrinking violet and your ill-judged, un-neighbourly email, with all the conations it contains is now on the record. As you will see I am copying your fellow directors as you have referenced them.
3. My 'suggestion' is not without foundation - in fact I go further as it is not a suggestion rather an assertion. I know of no legal responsibility on my part to pay for the fees in question whilst we were tenants quite the contrary as I have even, in the past, obtained the management fee for you (through my own strenuous efforts) from Mr Gallas via his agents a 'herculean' task if you recall.
4. You seek to suggest that if I do not pay the sum which is not even due from me, or I presume a pro rata sum of £750.00, you and your fellow directors will seek to impugn if not to defame my character via the AGM to other shareholders. On this I have the following observations:
a. I have never owed your company any funds whatsoever
b. I have volunteered to pay any funds from the time of ownership via my own company (15 January 2016)
c. Seeking to promote a view which is contrary to the above is clearly defamation, coercion and intimidation
d. The email below, of which presumably there was part of a quorum of the board of directors which sanctioned it, seeks to intimidate and harass without any foundation for which I will seek appropriate remedy in the event I need to. I will not, for the avoidance of doubt, believe that it was sent in the absence of the knowledge of at least one other director. Peter [Mr Beckwith], who I know is abroad and is a close family friend, would never in my view, have sanctioned such a ghastly and beastly note to have ever been conceived leave alone sent.
e. I confirm I am happy for any or all shareholders in Prospect Place to see the full correspondence of this audit trail - the initiation of which was by the director(s) of the management company provided it is in full. From a legal perspective I am also happy to have it published in a wider capacity.
5. You state that I or my solicitor should write a form of words that the directors would consider. Apart from the effrontery and defence of the other parts of your email, I think it is reasonable for me to ask, somewhat rhetorically, why it is that I should have my solicitor write to the company on a matter in which there is no legal basis for your claim. I may justify fees in writing to you and your directors for sending me such an invidious note which threatens the peaceable existence of me and my family but that is about the limit of it.
Other: I reported the following to David Archer, senior partner, Pitmans LLP in a casual conversation I had with him last week - I say it was casual in case it should be seen that I can be intimidated so easily which warrants me calling a lawyer. You will no doubt recall, as my wife and I clearly do, the incident in 2012 when Mr Vogt had claimed to speak to my wife about the front lawn and no such conversation ever took place whatsoever. I go no further on this point, at least for now.
Last week, your gardener, who identified himself as Jakob, no less confronted me with a very menacing and aggressive approach and tone respectively, in which he told me I was "wasting everybody's time" and that I should pay him "at least 20 to 25 quid" to clear the leaves. He told me that he was employed by you and that you had told him to ask me. Having spoken to me in this manner, he goes on to ask, menacingly, "can you speak English?". Ironically, a first generation immigrant, who can hardly string a grammatical sentence in the language [illegible], asks this of a second one! It seemed obvious to me that he had been put up to the whole task; this had shades of the past of course to which I refer above. For the record, I was educated in the English medium, attended two (English medium) top ranked Universities, was an adviser or to the UK CBI (in English), adviser to the Dti (in English) and adviser to the Prince of Wales (in English), am a Visiting Professor in a leading (English speaking) University, and a director of an English company of which all matters are discussed in English and am a father and husband within a house where only English, with poor but passable French, is the 'mother tongue' and more (in English); we can therefore reasonably deduce that I have passed the English test and I would thank you not to send your gardener around to ask such rude and impertinent questions. I trust this type of incident will never again take place. I now have a note from Jakob for £700.00 for the clearance of my garden. This is clearly intimidation and harassment. You might like to remind him that I have paid my dues for his welfare as a recent immigrant himself and that as house owner in the close he will in future treat me and more immediately my family with more respect as in the alternative I will take swift and pretty harsh action please do not underestimate me on this. If you think me a shrinking violet I warn you to think carefully, again please.
Attempted intimidation and harassment and indeed coercion of a young family but a few weeks after we have become permanent residents is an invidious thing to do yet with this email it has been done. I have sought to have the view of acquaintances to your email below to which one of the following comments have been made which I want to quote: outrageous; and 'I would not want to have neighbours like this'.
You have set a precedent in which it seems to me that you (and possibly others) intend somehow to bully me and my family a totally invidious thing for me to think leave alone write but I would like to leave you and your fellow directors under no illusion about the following: we are not ones to be bullied. Putting this to the test would result in a very sad state of affairs. We will live here in peace as we have always done and go about our daily lives without coercion or the threat of unfounded allegations and the insinuation of blackmail. The email below demonstrates a woeful lack of decency and seeks only to shame its author.
It is hugely regrettable that you have chosen to write to me in the manner in which you have and given that you are a solicitor, I would have expected better. I shall always remain surprised at this incident. I do think you have misjudged my mild manner for that of being one of a pushover. I would caution you to think again.
Finally, I do reflect and wonder how on earth it is that a mere sum of c£375.00 (for which I am not the debtor) has resulted in such an aggressive, unwarranted and horrible letter but weeks after we have had the joyous occasion of becoming permanent residents.
I look forward to your (and your fellow directors') response to the pertinent points above".
"It's a very sad state of affairs that the board believes it can blackmail and bully me and I'm surprised you have not come to our support as you know me well and even more surprised that a retraction and apology is denied. I will take this all the way as I will not allow me nor my family to be treated like this".
"no communications from Pitman [Mr Chandrasekaran's solicitors] on this front will be forthcoming until this matter is resolved. I could not respect myself if I put up with this sort of bullying from day one and as we both know the docs that are supposed to be required from Pitmans is simply a red herring. I will write to the board later. I am not having the piss taken of like this and any other businessman who has seen this seems more outraged than I am as the victim".
"We regret if you consider that we have been discourteous as none was intended.
Further we confirm that you and your company have been treated no differently from any other buyer of a property in Prospect Place and that we hope that we can all be on good neighbourly terms".
The letter (the "Letter of Regret") continued to explain that a new share certificate could be provided upon Mr Chandrasekaran providing the usual indemnity and setting out details of the outstanding service charge, calculated from the date on which Lily bought the property and how it could be paid.
"This matter has been passed to our Litigation Department following the receipt of your unsatisfactory letter of 9th February 2016 which fails to address the significant concerns to which your original email of 3rd February gave rise".
The letter which extends beyond two pages referred to the threats made in the Company's email of 3 February 2016 which "were manifestly an improper attempt to coerce our client into making payment of the sums which you had already acknowledged that he was under no obligation to pay". It continued:
"The nature of your current conduct strongly indicates that you intend to continue to threaten to make further untrue allegations which are defamatory and actionable, in order to bring pressure to bear on our client to accept liabilities which as a matter of law are not for him to discharge. The threatened publication, prior to the AGM, of defamatory and misleading allegations pertaining to our client which are of a wild and unsubstantiated nature would self-evidently cause our client serious harm of a nature actionable under the Defamation Act 2013. Our client's position in relation to these threats, and the course of conduct of which they are examples (and which is undoubtedly also actionable under the separate head of harassment) is expressly reserved. He is entitled to take formal legal measures to protect himself and his position up to and including the issue of interim injunctive proceedings without notice".
The letter concluded that in the absence of Mr Chandrasekaran receiving by noon on Monday, 15 February 2016 (i) an unreserved apology of the "disparaging and untrue comments made (and threatened to be made) about our client and his conduct"; (ii) an assurance of fair and equitable treatment, backed by an indemnity against future costs that Mr Chandrasekaran may be obliged to incur in securing the company's performance of the same; (iii) an undertaking that this type of conduct will never be repeated; and (iv) prompt payment of his legal costs "in relation to this exercise" (which I understood to mean the costs Mr Chandrasekaran had incurred in instructing his solicitors in relation to the service charge dispute), he would be advised to commence formal proceedings without further delay.
" In our email to you of 3rd February we accept that we used injudicious language in writing to you as we did. We also recognise that the content and the insinuation contained within it was distasteful, and would have seemed in any view coercive in its manner and with hindsight we see that we were in error. For this we apologise unreservedly whilst also fully retracting the offensive email in question.
We recognise that the debt for the period before your purchase of the property is not due from you or the company which is now to be the legal owner of number 7 and that in attempting to go after you for that debt, we erred.
We also apologise for the conduct of the gardener and will ensure that this will not be repeated.
In conclusion, the events between the completion of your property purchase on 15th January and the present fell well below the standard we would expect of ourselves and we will ensure that in our future conduct we will treat you fairly and equitably, just the same as we would any other shareholder of Prospect Place. Having said that, in consideration of the distress caused to you, we wish to pay your reasonable legal costs up to £500.00. We wish to have good neighbourly relationships going forward, and trust that this will reassure you of our good intentions in that regard".
"As discussed, I attach a copy of the letter, and sent it on the basis that this settles the matter and will be kept private and confidential by your client. We will send the original letter to your office today by post".
"Mr Chandrasekaran is not at all anxious about becoming a shareholder but as this firm owes a duty of care to Lily to finalise this we are writing to ascertain if indeed you are, contrary to your assertions during the period in which Messrs SW19 Lawyers LLP were acting for you, looking to prejudice its position by preventing its rights under the freehold to become one. Please can you state your position by return?"
"Pitmans know what is required of them to complete the formalities".
Mr Vogt replied to Mr Birley also by email:
"Will you reply to Pitmans just stating that Peacocks have been appointed? Hopefully it will then become less personal!"
"Dear Peter,
Given our planned discussion after 6pm today, I am forwarding this to you with a copy to David and Bianca, ahead of instructing them to send it to the board. I have gone from being upset to being very, very angry. I seldom if ever get this angry as you know, but all my supporters a number of whom you know, have told me that I do not need to accept being treated this way and I certainly do not. I have done nothing to invite this hostility and despicable behaviour and enough is enough "
It is unclear from the bundle which letter or document Mr Chandrasekaran was forwarding that made him so angry but it appears to have related to the continued absence of Lily's share certificate. Mr Beckwith immediately emailed Mr Vogt asking why Peacocks were not "dealing with this promptly". Mr Vogt replied saying that when speaking to Mr Archer, it would be worth emphasising that in view of Mr Beckwith's impending departure from Prospect Place, the Board had decided to appoint Peacocks to handle all administrative matters including finalising the outstanding issues with 7PP, but that formalities with Peacocks had only been completed late the week before and that explained the delay. There had been no wish to obstruct finalisation.
"perplexed as on 16th January you confirmed by email that [Mr Chandrasekaran] (through his company Lily) will only be liable once the new Deed is executed".
"I did not confirm that Lily is not liable pre its purchase. That company's name was never mentioned in our conversation. Nor did I say that Mr Chandrasekaran was not liable.
As I have said before Mr Gallas remains liable on his covenant until released and were the Management Company to litigate against him, he would no doubt rely on the covenant for indemnity which his solicitors should have obtained for him".
That reply does not appear to have been sent. Instead, Mr Vogt suggested that it might be better to send Mr Archer a copy of the Letter of Regret "as this pretty much covers the situation".
The gardener
"Presumably someone had a word with him because he has not confronted me in the same way since, though he is generally haughty on the occasions when our paths cross".
Nevertheless, he says that:
"His presence on the estate has been a regular and upsetting reminder of the event in 2016 and caused my family continuing discomfort. It has been a constant reminder of the apparent contempt the board has towards my family".
The gate entry system
"If you could let me know the nature of your request the Board will be happy to look into it. I am aware that the gates were working rather slowly but hopefully this has now been rectified. As you are probably aware, ds look after the intercom and cctv whereas city gate look after the gates".
"He approached me last night when I saw him outside and started talking about getting digital controls in his new house rather than analogue and how he can check up on his house whilst he's away etc."
"I've spoken to number 7 now and they're still talking about an upgrade to the intercom system. I think they're trying to gather support amongst residents. There is a BPT system available that can have handsets in the house and also use an app as well if required on mobiles and tablets. It would involve changing every component of the system and also having a good broadband line at the controls by the gate. The existing cabling could probably be used though.
I'll pass on the name of the system to number 7 but will obviously not "recommend" an update as such to a system that works perfectly well".
"Please see below messages from ds. Let's await details my first reaction is that there is more scope for problems than with the existing system which works well Rgds Paul".
"I think you know my feelings about him by now, lets see if he approaches us in the proper manner regarding this on the 28th?"
This was a reference to the Company's forthcoming AGM on 28 November 2016.
"Further to our telephone conversation of this morning I now enclose a copy of the email from Brian Cathcart at DS to Paul Vogt.
In order to resolve the matter, [Mr Vogt] is asking if DS will come to my house at 4pm on Thursday 10th November to present the BPT System and at the same time confirm whether or not the existing cabling can probably be re-used throughout and if not with what amendments e.g. converter?
Obviously your presence at that meeting is mandatory.
I will confirm as soon as possible that the meeting is on".
"Dear Peter,
Firstly, thank you.
I have read the email from both DS and from Mr Vogt, in reply.
Rosie Town (copied) and Jerome Mohamed (copied) have been dealing with Brian Cathcart of DS.
To say we are exasperated is an understatement as for three months we have been in dialogue with DS systems which has, amongst others, gave us misinformation. We have had to put the folks there right numerous times. The nature of the writing in the communications below is of course revealing and telling. Rosie, has never before expressed to me her exasperation at dealing with any matter as she has this one and in particular with Brian Cathcart whose conduct I know you would not yourself tolerate.
For the record, we have never tried to 'gather support amongst other residents'. The rest of what is said in BC's email which I note has pejorative overtones about us, is at best specious. The patience we have shown and the goodwill we have given to DS in educating them as to what is in the market and that which they should get trained up on is something you may not be aware of.
Alas for the record, DS have themselves told us that the current system is antiquated and needs updating and has said that they themselves cannot gain support from the board to change it! To then see a change of stance on this is rather extraordinary.
The work to the house is being severely held up by this intransigence on behalf of this supplier. It is now costing us dearly in time and money and I brought it to your attention after all these months, to seek assistance.
As to Brian Cathcart saying he will not "recommend" such a system - well, at the very least this is prejudicing a shareholders interest, presumably at the behest of somebody else as he seems to be quoting it and we do wonder why it is that we continue to be at the wrong end of unneighbourly treatment. It is perplexing.
I cannot attend tomorrow I'm afraid even if I wanted to as my diary is conflicted. In any event, as I say above, the nature of the writing below between the supplier and the board is telling and any attendance would I fear be a waste of time".
"I have been dealing with DS for works at 7 Prospect Place by request from Paran C. I believe there has been some misunderstanding. DS were contracted to make a simple connection from the gate system to the telephone system. After numerous visits over several months the work was finally completed. During the process numerous unrelated issues were discovered including a major piece of renovation at the control box for the gate. This had nothing to do with number 7 but Paran asked me to assist DS for the benefit of all the residents of Prospect Place. Throughout the process it was stressed to me by DS that the entry system was old technology and in need of updating. I watched DS troubleshoot the issues. Either they did not know what they were doing or the system is in such poor condition that they were hounded by multiple consecutive issues making troubleshooting problematic i.e. one problem led to another. This is not the sign of a stable and reliable system.
I note from a comment below that it is suggested that broadband would be required. This is a false assertion. The obvious solution is to install a new system that is reliable and therefore provides lower cost of ownership and numerous other benefits (a good example is the Siedle system).
I must contest the suggestion that a new system will be more scope for problems. The current system has already proven to be unstable and out of date (by DS's own admission). A new system can only be more reliable.
I am a senior networking and security consultant of two decades, I am happy to be of more assistance if required but do feel that we need a better level of cooperation from DS systems".
"Thank you for your message.
There may well be some misunderstandings and I am grateful for your input.
We (the Board) were first approached by DS systems on 27 Sept. I then had various exchanges with Rosie and following her request to arrange a meeting I advised that Bill Stonebridge would be available.
There was a discussion a few days later but only about generalities (the wish to have a more comprehensive and modern system) rather than specifics. We then suggested to DS that they should contact No 7 with availability of systems but pointed out that any new system would be subject to residents support.
Incidentally the Board has never received a request from DS to update the system and have been informed that it is working well. Similarly there have been no complaints from other residents.
I feel sure that both The Board and the residents will be willing to consider any request to upgrade.
I therefore suggest that you (considering your technical expertise) make a proposal including the cost and advantages of a new system. Ideally this could be considered at our agm on 28 Nov when all residents are invited to attend.
Meantime we are trying to set up a meeting with Brian Cathcart [of DS Systems] but he is on site in Bristol this week. Would you like to attend this meeting?
Finally I would like to emphasise that we are not in any way trying to be obstructive or unneighbourly. We are here to represent the interests of all residents equally and fairly".
" I cannot comment on what DS systems might have been telling your board, but I can confirm that on numerous occasions they told me that the current system is outdated.
Whilst Paran would encourage me to help in whatever way I can, I do not feel it is appropriate for me to attend a meeting for reasons which will become clear in this email. I am also not a retailer of such systems and therefore cannot put forward a proposal with costings, rather this should surely be a task for DS systems as your appointed supplier, however I question their breadth of knowledge for this.
What I say I do of my own free will and that is that for some 7 (seven) months I have struggled to get cooperation from DS to complete a simple task (project start date was 21st March). I believe this was due to a lack of understanding of the technology. More recently my colleague Rosie Town has received push back at every instance which is severely hampering the completion of works at number 7. We have therefore been very reasonable in the patients we have shown.
Today, we finally received contact from DS with information about how to add a phone at number 7. Whilst this is very nice to know, our request was for them to install the phone so the builders may continue work that has been put on hold. In that same email DS suggested a new gate entry system. I am perplexed that a. this was sent to us and not to you and b. why communications with me concur with the need for a new system yet those with you suggest the opposite? I refer here to the email from DS systems of seventh November.
If I may say, I am very surprised that such a fuss has been made out of such a trivial job".
"the immediate problem 'holding up the works' has been solved (I will recheck with DS) and in which case there is no need for an urgent meeting. I will also get reconfirmation from DS that the present system works well. DS are doing some work on an upgraded system and this will give us an idea of the cost/scope which we can present to the agm".
"Thank you for your message. I am sorry that you are experiencing problems and we will do our best to assist. I should clarify one point DS contact me/the Board on matters affecting the community but matters affecting one specific house are dealt with direct as has been the case with no 7. If you can let me know exactly what is outstanding with DS I/we will endeavour to get a satisfactory response".
"I am most grateful and understood.
With regards to number 7: as you may have ascertained from the emails which have flowed, DS tells us
1. the gate entry system is outdated and cannot accommodate our request for a gate entry system to work with our home automation system.
2. DS inform us that everything must be sanctioned by the Board (which is of course understandable).
We require at least now another entry system to be installed and are not receiving any cooperation from DS. The matter is urgent please.
We have been at it for seven months with DS. This is now causing delay to our renovation. Frankly I was dismayed to see the email of 7 November to you which implies that they are in fact not inclined to deal with us directly. No calls are being returned.
If it would help to clarify the position, I would be glad to speak with you".
"Paran its precisely this sort of issue you sd be raising at AGM on Mon!".
"I have obviously brought this to the board's attention by way of the email of last night. I cannot do more by attending any meeting. I see writing often (not always) as a good form of communications and am rather confused about this suggestion that I must attend an AGM. Plenty of residents do not, I am reliably informed, including the owners of number 8 and number 6, attend such meetings. Why am I being harangued to attend?
For the record, I shall not be attending any meeting of the board not least after the unprovoked and horrendous events of last year which we settled by way of the board assuring us that they will treat us in the same manner as others. This clearly is not the case given that DS tell us that they cannot cooperate without the board consent. Why? As you know I did invite the chairman to call me to discuss the DS matter so the request to attend AGM's is a peculiar one, at least to my mind. We continue to suffer great financial loss and time at DS's lack of cooperation. What will the board do to assist given that we now find that 4 others have asked for an upgrade to the system yet we are being told that the current system works perfectly well and repeatedly told by DS that they need the board to instruct them to work on number 7?"
"For the avoidance of any doubt this is to confirm again that you are free to discuss any requirements from number 7 directly with them. The Board only has an interest in matters affecting the whole community rather than specific issues".
"the process became hampered by poor conduct and communications by DS which appeared to be orchestrated by the Prospect Place management company who were discussing matters with DS Systems from behind the scenes. This is evident from several of my conversations with DS Systems staff who repeatedly described the gate entry system as being in very poor condition.
This is further evident in the email from DS Systems to Mr Paul Vogt on 7 November 2016 clearly showing collaboration. Mr Cathcart states "I'll pass on the name of the system to number 7 but will obviously not "recommend" an update as such to the system that works perfectly well. This email completely contradicts my discussions with the DS Systems engineers who were clear in their advice that the system was old, in poor condition and in need of upgrading. The email also shows that there had been previous conversations between DS Systems and Prospect Place Management company which clearly led to a change in advice (which was technically incorrect)".
The barking dog
"I am sorry to hear of the disturbance caused by your neighbours dog. I will have a word with them and suggest you do the same".
On 28 November 2016 he also emailed Mr Stonebridge saying:
"I went round to No 8 yday but no reply. In case you see anyone from there perhaps you could have a friendly word".
"Of course I had written to the board on this previously and never had a response".
"Pavan
You love an email don't you!
Your email doesn't tell the whole story.
I have knocked at your front door numerous times including today but no one answers the door.
Maybe when you feel like it you could talk to me as your neighbour about this and also inform me as to when your builders will be finished so that me and my family can get some peace and quiet once again!"
"Thanks I think for your email which sounds extraordinary.
I don't understand what problem is I was passing something on for the records of the board which is a good discipline. As for not telling the whole story I would be pleased if you could recount it in full if I have missed aspects.
As the knocking on our door 'numerous times' I'm afraid I'm really perplexed as nobody else has complained of this. I am aware you knocked today but as my wife is severely unwell and as I was on an urgent call, our little 7 year old who saw you and vice versa could not open the door; I'm sure you understand this rule of any youngster. Please let me know the other times at which you have knocked. Given your present state of mind and given I have experienced how misunderstandings can lead to tensions, I would appreciate it if you did not come around to house as our children are exceedingly timid and I will not expose them to any possible confrontation. I'd be glad to address any concerns you have over email and of course you and indeed Pat are always welcome to come over for a drink although a little later in the year as we are so busy just now.
As for the builders they will finish when they do.
Happy New Year".
"Love thy Neighbour
Why would I want a 'confrontation' with You?
X"
Garden waste and children cycling on the land
"Can I ask you to kindly confirm that this email was in fact sent to all residents? For the avoidance of doubt, we the residents of number 7 have not transgressed the protocols listed below.
Whilst writing, may I ask that the newly paid for brown bin lid (as the council has run out of full brown bins) finds its way back to its rightful owner at number 7 in order that it can be labelled as most often it seems to be claimed by number 1, your fellow director [Mr Stonebridge lives at 1PP]. This is a brand new bin with a green base and cannot be confused with tattered and aged brown ones.
May I also suggest to the board that it would be a good idea to remind other neighbours especially new ones, of the boundary of communal and private land. For example, the grass at number seven and indeed the entire drive has been used by children from other houses as a biking track and a play area; this is of course private property. This is of course private property and I feel a word from the board would be helpful. I feel if in fact it were to happen to one of the directors' land, then swift action might be taken".
"I confirm that the message was sent to everyone ("dear all"). The Council binmen marked the garden waste bins last Monday. If they marked them wrongly then no doubt this can be corrected so that everyone has the right one by next week.
Regarding children cycling etc I had the same situation which was resolved by a friendly word".
"An email marked "Dear all" with blind copies does not necessarily indicate it was sent to all 8 residents it may have been a subset; hence the query.
The bin point may seem pedantic and indeed according to our values it is. But many items have gone missing and accusations made in the past that on advice I was acting to ensure that this issue, no matter how small, was on record. The new bin, which was the property of no. 7 has consistently found its home at number one after being emptied. The wrong bin in the wrong house is not the or care bin men would be my own guess. I would like the one we paid for to be returned to us by next week at the latest.
Children cycling: I did have a friendly word as is our nature so to do. The problem thereafter persisted".
"if the Board would consider writing a general memorandum to all residents asking for them to recognise the boundary of private properties and therefore to respect the fact the gardens and grounds are not common and are private?"
"This is not really a matter which falls within the Board's responsibilities, nevertheless I have had a word with the new residents and would not expect the problem to re-occur".
"I trust the word was not one of a personal complaint as I have always believed some kind of 'rule book' would always help residents. I know we would have welcomed it when we moved in that was one of the reasons for the request".
"At 07:40 this morning we had the most extraordinary call from the gate with a gentleman accusing us harshly of not paying the bins and he went on to admit this had been advised to him by another resident. Voluntarily he said it was not from number 6 or number 5.
There have been numerous incidents of which I have not written to you which directly relates to the conduct of members of the board and I feel sure you will be aware of them. If in the event this morning's episode was triggered by the action of the board or one of its members, I would be grateful for your open and honest indication".
"He needs help
I was told by the gentleman who collects the garden waste that he had 10 bins of waste to empty but only 6 had been paid for.
No other conversation took place other than I told him that two of them had been left out since the last collection two weeks ago.
As I have no idea who has or has not paid why would I have discussed this with him?"
"You have my assurance that no board member has "accused you of not paying the bins",
The waste collector advised a Director this morning that there were 10 bins of waste to empty but only 6 had been paid for. The conversation went no further than that.
Turning to your second paragraph I am sorry that you appear to be dissatisfied regarding the conduct of the Board. I believe this criticism to be unfounded however if you wish to give me specific instances I will look in to them.
If the residents generally are not happy with the Board then it would be better to appoint new Directors or to have (at great expense) an independent management company.
The Directors freely give their time and efforts for the good of the community. Personally I would be delighted not to have this responsibility any longer".
"If indeed there are 10 bins why then does the board not write perhaps a note to the offending household? I know from my own experience, even when we are not out of order, we get stern reproaches. Why not those who are offending now and thereby disadvantaging households like number #7.
This is the direct responsibility of the board.
Why is it that the Collector was told by your director that we are the offending party and that our bins should not be taken? This is now two collections in a row".
The appointment of JCF, directorships, Mr Joseph's appointment to the Board and Mrs Maheswary Chandrasekaran being told to park outside the estate
"As you may be aware I handle the day to day administration of the company at present, however I wish to be relieved of this responsibility.
I have therefore approached JCF Property Management who are willing to undertake this task and a copy of their proposal is attached. Your directors recommend acceptance.
Apart from other considerations I feel it will be beneficial to have a professional, independent and always available third party looking after the estate. Their intention is to continue with our present suppliers subject to review. Kindly let me have your approval.
Please also give some thought to the composition of your Board. In accordance with the articles there should be minimum two and maximum four directors. Currently Bill Stonebridge and I are the two directors following the sad passing of Cynthia Hipps. Richard Joseph of Prospect House has signified willingness to join the Board and he would replace Bill who wishes to retire, so this leaves up to 2 places open for any shareholders who may be interested in joining".
"A few months ago, I did in fact suggest to Paul Vogt that it would be good if you were to consider joining the board as issues were causing considerable stress amongst the community in the estate. I am therefore delighted to hear that you have signalled your willingness so to do. However, I would like if I may to have a word with you on the phone at a time of mutual convenience about this issue and to that end can I ask for your availability this week to take a call? I am rather grasping the nettle in writing to you together with a modicum of embarrassment. However, I think on balance, it is probably the right course of action".
"Good to hear from you and I hope you and your family are well. I'll happily give you a call on Thursday, would 5 PM be okay for you?
I'm happy to join the board but only in the capacity of representing the owners when it comes to dealing with the maintenance contractors for the common areas of Prospect Place or appointed managing agents in a professional manner but unfortunately only have time to manage this and not other issues outside this remit. I'm assuming this is acceptable for the shareholders".
"On behalf of Lily Property Nominees and also my family as residents, I now repeat the request I have made in previous correspondence and I would hope that on this occasion you would kindly do me the professional courtesy of a response.
Why is it that despite the time at Prospect Place, no invitation has been made to the residents of #7 to join the board and are passed over by invitation to new ones?"
"Richard the background to this is that PC believes that he has been treated unfairly/badly by the Board (and to date has not paid His service charge). In his email of 27 Nov he expressed surprise that he had not been approached to act as a Director but advised that he was "in no way applying for the post in the slightest" . He also suggested that you should be approached.
I replied that the Board would welcome new Directors and invited anyone interested to get in touch. There the matter rested.
Board appointments were last confirmed at the agm in November 2016 (which PC did not attend)
I will draft reply to PC along the lines that if he has changed his mind then Lily would be welcome to propose his appointment.
Bill has already decided to retire from the Board and once JCF are fully in place it will be expedient for me to retire as well in view of the lack of trust in the present Directors by number 7".
"Dear Mr Chandrasekaran
I refer to your recent email. I really have very little to add to my reply of 4 December. Richard Joseph was approached following your suggestion to that effect in your message of 27 November in which you also advised that you were in no way applying for the post (of Director).
Yours sincerely"
"I have now received a draft management agreement from JCF. It looks pretty straightforward let me know if you would like a copy.
I have not heard from any shareholders yet however members 1/2/3/4 are obviously in agreement and Oliver Beaumer in number 5 introduced JCF so will presumably also be in favour (the Directors have the authority to appoint JCF but we are consulting shareholders as a matter of courtesy)".
"In your email of 4 December, you state:
'The Board would welcome new directors. Our Articles of Association require us to have a minimum two and maximum four. The Articles set out the procedures for new director appointment. In summary, a person has to be recommended, either by the Board or, through a procedure, by a shareholder, and then appointed at a general meeting by a majority of shareholders. The Board can also appoint a new director temporarily until their appointment is confirmed at the next general meeting. There are no specific criteria for appointment, other than a willingness to act, any specified in the Articles and any there might be by law'.
It was indeed I who made the suggestion to appoint Mr Richard Joseph once he was in residence and I now see that you have in fact, invited him prior to him being in residence. Presumably you did so following the guidelines above? I would be grateful for your confirmation of this as all I did as a shareholder was to make the suggestion, once RJ was in residence.
My Trustee and I requires to know why that privilege has never been offered to #7. You have had ample (I repeat, ample) time and opportunity to make an invitation to board in the past, of me but have never done so and it has been obvious to all that it would never have come. Your response below therefore, I regret to say, is wholly disingenuous and avoids answering the question posed in my email of 26 February. It is clear from this terrible history of this relationship that both the interests of number 7 and any possible inclusion of its representations at the board have been thwarted, if not blocked. The interests of #7 have on several occasions, been prejudiced.
For the record, I do not agree with your decision to appoint JCF Property Management (JCF). There has been, to my knowledge no tendering. Whilst the services of such an agent is basic, we are concerned that you alone seem to have the responsibility of appointing them and thereafter directing them at your own discretion. We are keen not to have a repeat of the issue with DS Systems whereby they were asked not to cooperate with us. JCF seem not to have experience with the newer technologies that will inevitably be needed by all neighbours in the future. Therefore their experience of handling such situations would I think be a pre-requisite at least by way of a question, before their appointment".
"I do not propose to go into the vast and detailed reasoning as to why we have not paid as it should be fairly obvious given what has been well documented in the past. To give some context however, given that board members can be abusive me personally and that my views are totally misrepresented at board meetings, it is an amazement to us that we are asked to pay to be prejudiced against. We have also incurred considerable losses by the unnecessary actions of the board and also believe that we have been defamed. We are of course more than willing to fall in as we have always done since purchasing the property, once we have fair and equitable treatment and are able to live in peace in our home which is the right of anyone.
I remain open and willing to receive to any fair proposal you may wish to make. Our objective is peace and the welfare of our home and the estate in which we all live. If in the event you are using shareholders' funds to instruct peacocks, as before, to further your position, unfairly and unjustifiably, then please make this position clear".
In a postscript, he added:
"I am not prepared to pay until we have equal and fair treatment and the losses we have incurred are recognised.
I also need to be on the board to protect our interests. Pls let me know when I can have the draft letter for this matter. Thank you in haste whilst chairing a meeting".
"Richard is only aware generally of the main issue i.e. your feeling that you have been unfairly treated by the board. At our meeting I will seek to explain that this is not the case and in particular we can discuss the misunderstanding in respect of DS Systems and the directorship issue.
Richard has been involved in the prospective appointment of JCF and we will explain the process followed in this respect.
With goodwill on all sides I hope that we can put our disagreements behind us, we all share your objective of peace and harmony in the estate".
"Given what my family and I have endured and that which one observer commented on as follows 'I wouldn't want to have neighbours like this' and with a view to making any potential forthcoming meeting profitable, I attach a letter from my legal advisers which I had already set underway prior to receiving your last email. Not wanting to waste the effort and above all the content, I have, as a gesture of hope, thought to send it to you as the Chairman of the Board myself rather than the solicitors themselves. My gesture in doing so should not be taken as one which mistakes my resolve to take it all the way if necessary. At the very least it may serve as a briefing note or an aide memoir. Please may I ask you to read it carefully. As it says, it is not an exhaustive list as to make it so would be an unnecessary waste of costs at this stage".
The attached letter was from Gardner Leader, solicitors and over three pages set out the history of Mr Chandrasekaran's complaints including mention that Mr Chandrasekaran's elderly mother, an octogenarian, was asked by a gentleman not to drive into the estate, rather to leave her car outside on the main road. The letter states that Mr Chandrasekaran would not put up with any attempted intimidation of his mother along any such lines. The letter concludes with a request for an agenda for the meeting with Mr Vogt and Mr Joseph but states that if a satisfactory outcome could not be reached, "and the prejudice continues" he would not hesitate to take further action as a shareholder "and in pursuit of his legitimate right to live in peace and have quiet enjoyment of his property".
"let us now move forward positively in the efficient running of the estate. We totally share your objective of peace and harmony".
" For you to suggest that you are not responsible for the actions of others, is once again, disingenuous. Practically all negative reactions to us as residents have come about when the board have been involved. It may be time now to flush out what your exact motive is when it is ourselves who have repeatedly asked if not pleaded for peace and harmony. It is clear to any onlooker that the board seeks others to do its bidding. The evidence attached to this email is but one example".
The evidence he refers to is various exchanges between Mr Vogt and DS Systems which I have referred to already.
Correspondence with Mr Joseph
"Whilst apparently you personally have no knowledge of the incident involving my mother, you and the board go on to use the law firm (whose only duty was to look after the shareholders' register) to suggest, that should my mother be turned away again, we can do nothing about it. Do you really think I will allow this to stand?
You make much of the fact that your appointment would only be to deal with the maintenance contractors and the managing agent. Well, given the Gardner is a racist, your use of shareholder funds to defend him against a resident and especially one who sponsored your appointment, needs explanation. You say you have no time for anything else but evidently you do.
The unilateral cancellation of the meeting by you in March of this year after significant inconvenience to my own hectic diary had a characteristic level of chutzpah which I now recognise as being part of the make up of the current board. With no notion of any form of regard for a much longer resident and a shareholder, which despite your assertions to the contrary, we are, you cancelled the meeting and embarked on 'armigerous' and 'pugilisitc' litigation and used shareholders funds for this purpose. I presume and would certainly hope that if a supplier to the estate made an anti-Semitic remark, you'd move quickly to, at the very least, remove it from further custom using shareholder funds. I understand that whilst you would like to enjoy the privileges of being on the board, you wish to have no responsibility for the legacy issues which it faces or its current conduct safe to say, you are obviously a part of it. I am genuinely curious to know what a Court will make of this, as a matter of company law.
You have purchased the trophy house in the estate and may be of the view that this gives you some disproportionate sense of standing. It may interest you to know (if you don't already), that for quite some time, the previous owner very much encouraged us to buy it; our trustees felt the price per square foot was unnecessarily high for this area. After the price dropped, we were encouraged again but my wife and I, recognising amongst others the restrictions on the property from its Grade II status, felt it was going to be difficult to bring up our children in a house which would create a chasm between them and their peer group, many of whose families live modestly. Consequently, we rejected the notion of purchasing it from a value system perspective. I say this as had we purchased it, we would not have given ourselves any form of grand-standing".
Pitmans' letter of 1 August 2018
"by continuing to retain the gardener your client is also effectively condoning his racism towards Mr Chandrasekaran. This amounts to a form of continuing discrimination in the form of victimisation under s.27 of the Equality Act 2010".
"We find it difficult to believe that such an elementary piece of company business has gone unmentioned to the Company's shareholders and can only presume that, once again, Mr Chandrasekaran and the Company member he represents have been selected for special treatment by the Board. Our client believes that his treatment is motivated by racism towards him".
Failure to consult Mr Chandrasekaran regarding the appointment of JCF Property Management
Directorships Mr Chandrasekaran never being informally approached to join the board.
"With the reduction in the size of the Board in recent times, none of the other residents has shown interest in joining. I am glad to know that there may be interest to enlarge the Board, and would invite anyone interested to get in touch, including our new neighbour Richard Joseph if he would like to. I shall be 80 next year and feel it is time to hand over".
"the section is not apt to deal with the case where the petitioner can himself readily put an end to the unfair prejudice alleged".
Mrs Maheswary Chandrasekaran being asked to park outside Prospect Place
"in the late Spring/Summer of 2017, which was after they finished the refurbishment of their property, I was asked by a gentleman in the estate not to enter the estate but park outside on the main road. I did not recognise this man. I was taken aback by this but wanted to do as I was told. I did find this difficult not least is parking outside often meant reversing into a slot between cars which I find difficult to do at my age. Especially so on such a busy road. Of course, driving straight onto my family's drive is far preferred because it is much easier. However, I did not want to cause any disturbance for my family so stuck to this routine for some time until my Son insisted that I enter the estate and park on their drive.
At the time of the incident, my Son was very busy with his work and so did not immediately know of what had transpired. My Daughter however was at home and was upset at me having parked outside. She insisted that I parked inside when I had already left the car on Copse Hill. Although I told her I would in future enter inside the estate, when it came to it, I just found I could not. I was afraid to cross the people involved in this matter as I was already aware at their distaste towards my family. I was worried not to exacerbate it which is why I disobeyed my Daughter.
I attended an AGM meeting in November 2018. There I saw the man who told me to park outside. Of course I have seen him in and around the estate previously. I understand him to be Mr William Stonebridge".
"firstly, I would like to clarify my First Statement where it states "I did not recognise this man". What I meant by this statement is that I did not know his name. I do say at paragraph 14 of my First Statement, speaking of when I attended the AGM, "of course I have seen him in and around the estate previously". In short, I recognised him as someone who lived on the estate, but I did not recognise him (or know him) as William Stonebridge at the time of the incident".
"Incident with client's mother
You give no particulars and so a full reply is not possible. However, we assume it is Mr Chandrasekaran's mother to whom reference is being made, LPN being a company and having no human relations. That being so, no discourteous or other adverse treatment of her (none being admitted) can possibly amount to unfair prejudice of the required kind".
"This is an extraordinary statement plainly intended to antagonise our clients. The attempt to use the authority vested in the Company to intimidate family members of a Company member absolutely can constitute, and in this case has constituted, unfair prejudice for the purposes of s. 994 of the Companies Act. The fact that LPN is a company as opposed to an individual is entirely irrelevant, a fact of which we have no doubt you are all too aware".
"Mr Chandrasekaran's mother and all his visitors may park in the estate and on his drive and a written apology signed by the Board to Mrs Chandrasekaran for wilfully instructing Peacocks to withhold answering this point".
"Obviously, you do not require confirmation that Mr Chandrasekaran's mother can park her car on the drive of no.7. This is an entirely imaginary and artificial grievance, contrived to lend spurious substance to a vacuous claim. It is not open to our client to prohibit such parking, hence we have not seen the need to say anything on the point. Certainly, you have not asked for confirmation before, as you should if you or your clients thought any was needed".
"However, the Respondents repeat once more that Mrs Chandrasekaran senior is always welcome to enter Prospect Place".
Counsel asked her how she was "already clearly aware at their distaste toward my family". She confirmed that her awareness arose as a result of what she had been told by her son and daughter-in-law. She also confirmed that when she described her son's request from the Company for an explanation for why she was required to park outside being met with a "very aggressive and unnecessarily legalistic letter which I found disgusting", she did not see the letter at the time; her son told her about it.
"Memory is an active process, subject to individual interpretation or construction. Each witness will have produced their witness statements many months ago, will have been asked to read or re-read their statement and review documents before giving evidence in court. There is high level commentary that reveals that this process reinforces a memory, even if the memory was false to begin with, and may cause a witness's memory to be based not on the original experience of events but on the material which has been read and re-read.
This is supported by the recent research undertaken by Elizabeth Loftus, professor of law and cognitive science at the University of California which reveals the malleability of memory by showing that witness testimony can, after the fact, be shaped and altered.
That is not to say that all the oral evidence given was unreliable. The Court has previously explained that it is safer to base factual findings in commercial cases on inferences drawn from the documentary evidence, common ground and known or probable facts."
Mr Stonebridge's behaviour
The AGMs
A campaign
Conclusion regarding the Petitioner's claim
Counterclaim
i) requires the Company to prove that in demanding the total sum of £2,250, it has complied with the requirements of Clause 2.1 of the DoC including that the sums demanded amount to reasonable expenditure and were or would properly be incurred in relation to matters referred to in the Schedule to the deed; and
ii) seeks to set off any sums found to be due under the Petition.
Insolvency and Companies Court Judge Burton
31 July 2020