BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
BUSINESS LIST (ChD)
Fetter Lane, London, EC4A 1NL |
||
B e f o r e :
____________________
Andrew Tinkler & Anor. |
Claimants |
|
- and – |
||
(10) Invesco Asset Management Ltd (12) Frederick Bouverat (16) Orbitus Trustees (Guernsey) Ltd (19) Stifel Nicolaus Europe Ltd |
Defendants |
____________________
Mr A Temple (instructed by Simmons & Simmons LLP) for the Tenth and Twelfth Defendants.
Mr C Catsambis (instructed by Baker & McKenzie LLP) for the Sixteenth Defendant.
Mr A Gledhill & Mr T Lau (instructed by Ashurst LLP) for the Nineteenth Defendant.
Hearing date: 10 June 2025
____________________
Crown Copyright ©
Mr Justice Leech:
(1) On 21 July 2023 Mr Tinkler wrote to the Panel apparently in response to a review which it was carrying out. In his letter, he referred to submissions which he had made on the same day in relation to alleged breaches of Rule 9 of the Takeover Code (the "Code").
(2) On 6 and 7 February 2024 Mr Tinkler sent Letters of Claim to the Active Defendants alleging an unlawful means conspiracy. In the last paragraph of his letter to the Nineteenth Defendant he stated that he was confident that there was no defence to the allegations (although he was prepared to engage in ADR).
(3) On 23 May 2024 Mr Tinkler issued the Claim Form and on 23 September 2024 it was served on the Active Defendants.
(4) On 20 November 2024 Ashurst served an Application Notice applying to strike out the claim form on behalf of the Nineteenth Defendant. On 3 December 2024 Baker & McKenzie followed suit on behalf of the Sixteenth Defendant and on 4 December 2024 Simmons & Simmons served an Application Notice to strike out the Claim Form on behalf of the Tenth and Twelfth defendants.
(5) On 27 February 2025 Mr Tinkler wrote to the Panel again. In that letter, he referred to submissions which he had sent to the Panel on 18 September 2023. On 22 April 2025 he wrote again to the Panel, again this time to highlight "material omissions" in a letter dated 17 April 2025 because it had failed to address critical evidence from submissions made to it on 9 August 2018 and 20 August 2018, some seven years earlier.
(6) On 16 May 2025 Mr Tinkler issued the Application Notice for a stay. The three strike-out applications have been listed before me for some time in a window this week and after Mr Tinkler writing to the Chancellor, I agreed to list the stay application immediately before the hearing of the strike-out applications.
(7) I heard the stay application yesterday on the afternoon of 10 June 2025, and before the parties had made any submissions in relation to the merits of the strike-out applications.
"By way of summary only, I note as follows:
a. My contention that Invesco (D10), Stifel (D19), and others concealed a concert party in submissions to the Takeover Panel (see paragraph 40.4 of the Particulars of Claim) and that D10 (Invesco) instructed Stifel (D19) to submit misleading concert party disclosures on Stifel's letterhead to hide D10's involvement (albeit that ultimately was not sent on headed paper, but instead with a cover email which gave the impression that it was sent on behalf of D19) overlap with my contention that the Applicants engaged in concert party activity before the AGM and after the AGM contrary Rule 9.1 of the Takeover Code.
b. My allegations within the Current Claim as to improper transfers of treasury shares to the EBT to manipulate AGM voting (see paragraph 75.8 of the Particulars of Claim), overlap with my complaints as to 'frustrating action' under Rule 21.1.
c. My allegations that the erroneous and misleading 29 May 2018 RNS announcement was used to influence shareholder voting (see paragraph 39 of the Particulars of Claim) overlap with my complaint that the Takeover Panel was provided with misleading submissions in June 2018.
d. My complaint to the Takeover Panel includes a complaint about the manipulation of the vote at and in connection with the AGM."
"24. This exchange demonstrated for the first time that the Panel was taking forward a full investigation into the matters raised. It also confirmed that the Panel had lacked sufficient evidence in November 2024 to escalate the matter to its Hearing Committee at that earlier stage."
"28. In turn, it is my position the application for a stay was made promptly once it became clear that the Panel had commenced a substantive investigation in response to my evidence, and once it was apparent that the investigation was both ongoing and unlikely to be concluded prior to the hearing of the Applications in June 2025. Conversely, it is my position that it would have been both unrealistic and indeed inappropriate for me to apply sooner, given both the uncertainty as to how (if at all) the Takeover Panel would further progress the matter, and whether any such investigation as might be taken would be concluded prior to the June 2025 hearing in any event."
"There is, as it seems to me, no reason to doubt that it is only in rare and compelling cases that it will be in the interests of justice to grant a stay on case management grounds in order to await the outcome of proceedings abroad. After all, the usual function of a court is to decide cases and not to decline to do so, and access to justice is a fundamental principle under both the common law and article 6 ECHR. The court will therefore need a powerful reason to depart from its usual course and such cases will by their nature be exceptional. In my judgment all of the guidance in the cases which I have cited is valuable and instrctive, but the single test remains whether in the particular circumstances it is in the interests of justice for a case management stay to be granted. There is not a separate test in 'parallel proceedings' cases. Rather, considerations such as the existence of an exclusive English jurisdiction clause and the danger of circumventing a statutory scheme for the allocation of jurisdiction (such as the Judgments Regulation) will be weighty and often decisive factors pointing to where the interests of justice lie."
"(i) The court has a wide discretion to stay proceedings, but in circumstances where the claimant itself has voluntarily brought the two sets of proceedings, a stay should only be granted in very rare circumstances ...
"(ii) Even where there are such reasons for a stay, a stay should only be granted if the benefit of doing so clearly outweigh any disadvantage to the other party ...
"(iii) A particularly compelling case would be required for a stay to be granted to the claimant years after he has brought the claim ...
"(iv) A stay will not, at least in general, be appropriate if the other proceedings will not even bind the parties to the action stayed, let alone finally resolve all the issues in the case to be stayed.
"(v) A stay will not, at least in general, be appropriate if the parties to the other proceedings are not the same;
"(vi) A Defendant against whom a serious allegation (such as deceit) is made is entitled to an expeditious hearing, and should not be left for years waiting for the outcome of another case over which he (and the Court) has no control. An action alleging fraud should come to trial quickly; thus unwarranted delay may lead to an action being dismissed for want of prosecution even before the limitation period has expired ..."
(1) The application was made very late. I accept Mr King's submission that Mr Tinkler had to issue and serve the Claim Form to avoid the claim being barred by limitation. I also accept his submission that it was unlikely that the Active Defendants would have agreed to enter into standstill agreements. But Mr Tinkler could have sought the consent of the Defendants to a stay immediately on service, and if they failed to agree, applied to the court then.
(2) For the purposes of this application at least, I am prepared to accept Mr Tinkler's evidence that he has only recently become sure that the Panel was undertaking an active investigation and I am not prepared to accept the Active Defendants' submission that the stay application was a cynical ploy to derail the strike-out applications. But the consequence of the lateness of the application is that I am faced with a binary choice whether to grant the stay application or to hear the strike-out applications.
(3) Faced with that choice, I might have been prepared to grant a stay for a short period of time, say three or even six months, if a decision of the Panel was imminent. But I am not prepared to grant an open-ended stay. There was some debate about the procedure which the Panel might adopt, but I cannot be satisfied that it will be completed within a year or even two years.
(4) I am not satisfied that there is a very significant overlap between the issues which arise in this action and those which arise in the Panel's investigation. Mr Adam Temple, who appeared for the Tenth and Twelfth Defendants, pointed out that Mr Tinkler's complaint to the Panel is that the four directors of SGL (as it was then called) concealed a concert party from the Panel and failed to comply with Rule 9: see Tinkler 2, paragraph 15 (above). But the allegation against the Active Defendants in this action is that they conspired to take control of SGL by making misleading submissions to the Panel, namely, that Mr Tinkler himself was acting in breach of Rule 9 of the Code. Indeed, the only reference in the Particulars of Claim to the directors acting in breach of Rule 9 is a brief reference in paragraph 40.4.
(5) It is common ground that the findings of the Panel are not binding on this court under the rule in Hollington v Hewthorn. I accept that further evidence may come out in the course of the Panel investigation or upon which the Panel relies, which is directly relevant to the issues in the present action. But if those documents are in the possession or control of the Active Defendants and this action continues, they will be under an obligation to disclose those documents in this action in any event. Moreover, in hearing the strike-out applications, the court is entitled to have regard to the documents which may come out on disclosure, particularly in a conspiracy claim.
(6) Mr Tinkler is not firing blind. The directors have already given disclosure in two heavily contested actions and I have had the advantage of considering that evidence and data, both on a contested specific disclosure application and at trial.
(7) I am not satisfied that Mr Tinkler will be deprived of a remedy if I refuse to grant a stay. Mr King took me to a Panel decision which shows that the Panel was able to award compensation assessed by reference to common law principles for a breach of Rule 9. If Mr Tinkler's complaint to the Panel is successful, it has power, therefore, to award him compensation. Moreover, Rule 9 requires a concert party holding more than 30% of the shares to make an offer to purchase the remaining shares in the company. But, as Mr Temple submitted, this is not Mr Tinkler's complaint in this action. His complaint is that the four directors conspired to take control of SGL by ignoring the wishes of the other shareholders, removing him as a director and then manipulating the outcome of the AGM. The very last thing in the world which he would have wanted to do was to sell his shares to them.
(8) I am not satisfied, therefore, that Mr Tinkler will suffer substantial prejudice if I refuse a stay, far less that it will be irremediable. But even if I had been satisfied that Mr Tinkler would suffer material prejudice, I would still have refused a stay and for the reason submitted by Mr Gledhill. His primary submission was that it was only appropriate to stay the action if I were satisfied that it was properly brought in the first place. I accept that submission. If, as the Active Defendants submit, the claim is abusive and represents a collateral attack on a number of prior judicial decisions (including two of my own decisions) then the court should strike it out and the Active Defendants should not be vexed by it. Furthermore, if Mr Tinkler has committed breaches of CPR part 31.22 by initiating the Panel investigation, as Mr Gledhill also submitted, then he should not be permitted to use the Panel's investigation itself as a means of avoiding the court's scrutiny.