England and Wales High Court (Commercial Court) Decisions

IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
London Mercantile Court

		Royal Courts of Justice Strand, London, WC2A 2LL
		31/07/2014

Judge Mackie QC:

1. In this summary I set out briefly developments in these cases since my judgment dated 5 February 2014. I prepare it so that interested parties should know broadly what is happening in other cases. It should be read with two judgments, Barons Finance and Reddy Corporation-v-Makanju [2013] EWHC153(QB) and Gopee [2014] EWHC 138 (QB)

Transfer to the County Court

2. These cases are now finally in one place. I have decided all relevant questions of law and procedure, subject to correction by the Court of Appeal, but not in most cases their application to the facts. With the agreement of the Designated Civil Judge for London, I therefore propose to transfer most cases to the Central London County Court, reserved to District Judge Langley or District Judge Lightman for determination by one. The County Court is now in the Thomas More Building only about one hundred yards from this court. In my view the District Judges are best equipped to try the factual issues in individual cases. There are two other advantages to this step. First litigants in person and many of the lawyers in these cases are more at ease with County Court procedure than with that of the Mercantile Court. Secondly in most of the hearings in these cases (but not all) I have found against Mr Gopee. He has argued that I am biased. I have in at least two cases already ordered that any trial involving Mr Gopee as a witness be heard by another judge. That should happen in all cases.
3. All existing orders of this Court remain in force. This Court will for the time being retain supervision of all matters arising from or connected with its orders dated 19 July 2013 and 29 January 2014 and any other issues requiring a High Court jurisdiction.

Applications since January 2014

4. The Court's order of 29 January 2014 required the transfer of all relevant cases to this Court and for Mr Gopee to provide a list of all cases within a defined category. Mr Gopee complied and provided a list identifying 427 cases potentially the subject of litigation. Of these some 45 are currently before the court.
5. The Court has made a variety of interlocutory orders apart from those of case management. Orders have been made restraining the Claimants from pursuing Defendants for possession or payment until trial (eg Barons Finance Limited and Reddy Corporation v Manyo Plange in February 2014- while the first Claimant is in liquidation Mr Gopee claims standing through the Second Claimant). Permission has again been given to appeal out of time against first instance decisions made a substantial time ago (eg Barons Finance Limited v Thompson in January 2014). A long outstanding judgment which was affecting a finance executive's ability to secure a particular job was set aside (Sundeep Dewal in June 2014). The Court made mandatory interlocutory orders removing the registration of a charge in the name of Barons to enable two sisters to sell their home (Rowland in May 2014). Orders have been made granting summary judgment. A case has been struck out for failure by Barons Bridging Finance to pay a costs order of £7,000. There are pending applications for summary judgment by Defendants for which directions have been given (eg Adewale in May 2014). At least one case (Kwela) settled with a consent order in May. The Court made an order for possession in favour of Pangold (Dumitru) when it was satisfied that the tenancy was unrelated to the issues in this litigation. In one case this month a lender Dunfermline Building Society sought and obtained in an action against Ghana Commercial Finance Limited an order that Mr Gopee personally pay the costs of an application. The court has generally tried to hear these cases together on the same day (eg 9 were heard on 23 May 2014)

Applications against Ministry of Justice and HM Land Registry.

6. On 20 March 2014 I refused to permit Mr Gopee to add the Chief Land Registrar as a party to the case in which the court made the Order of 29 January.
7. In June I received six applications from Mr Gopee on behalf of Ghana Commercial Investment Limited for permission to issue proceedings against the Ministry of Justice, HM Land Registry and individuals who have allegedly sold their properties to the Claimant. The Claimant has claims arising out of what it says is the refusal of the Registry to register the sales. I have given a direction in three of those cases and the other three will be stayed for the time being. The applications were brought in this Court after Patterson J had refused permission to the Claimant to bring judicial review proceedings in the Administrative Court. (The judge made that decision based on my Order of 29 January 2014).
8. Permission to bring these actions is required because of the terms of the Order of 29 January 2014. I made that order to ensure that all litigation relating to what are known as the Barons' cases was kept in one place. I did not make it as the equivalent of a Civil Restraint Order. In principle therefore the Claimant should be permitted to proceed subject to questions of case management and abuse of process.
9. The claim against the Ministry is that it is vicariously liable for my acts and omissions. Mr Gopee is fully entitled to criticise my decisions and to claim that I am biased. As Mr Gopee is aware there is a route for those criticisms. It is to the Court of Appeal. An action against the Ministry based on my shortcomings as a judge is bound to fail. As it would be an obvious abuse of process I will not permit it to proceed. The draft Particulars of Claim must be amended to remove the Ministry as a Defendant and to delete all allegations which should properly be put before an appeal court.
10. The Claimant Ghana is a comparative newcomer to this litigation. It claims to have acquired fifteen properties between December 2013 and April 2014. No details are given of how it comes to have title to those properties. Behind most (but not all) transactions which have come before this court are two issues. First Barons Finance Limited is in liquidation and valid doubts have been raised about transfers between companies in the period leading up to, and during, the liquidation. Secondly title to properties has been obtained in the past following alleged defaults on loans made in breach of relevant legislation. The proposed Claimant will not be permitted to proceed unless and until it has satisfied the court, by filing a witness statement and appropriate exhibits, that it arguably has a valid title notwithstanding these two issues.
11. The proposed claimant appears to be owned and controlled in substance by Mr Gopee. It appears to be litigating entirely at the initiative of Mr Gopee. Mr Gopee is warned that, in these cases as in all others, he may be personally subject to applications to pay costs should the cases proceed but be unsuccessful.

First-tier Tribunal

12. Mrs Lilian Gray has made applications to the Property Chamber, Land Registration, First–Tier Tribunal against Mr Gopee and Barons Bridging Finance (Euro Business Finance), Property Chamber REF/2013/0927. On 14 April 2014 the Tribunal in effect required Mr Gopee to apply to this Court before being permitted to put forward certain defences. On 15 May 2014 Mr Gopee applied to this Court for permission to continue to defend the Tribunal case on the grounds he has put forward. The defence put forward to the Tribunal appears to be doomed on precisely the same grounds that have repeatedly failed before the County Court (when it has been aware of the legal issues ), the High Court and, when permission to appeal has been sought, the Court of Appeal. Indeed some of those grounds failed also before the Tribunal dealing with credit licensing. It would, as I see it, be an abuse of process for Mr Gopee to be able to raise the grounds put forward again in yet another case when they have no prospects of success. This will cause delay and inconvenience for the Tribunal and injustice for the other side. Potentially it raises the risk of inconsistent judgments although in practice the approach of the courts and tribunals on these issues has been entirely consistent. On 16 June I informed Mr Gopee that I was minded to refuse him permission to proceed with this defence. He has exercised his right to have an oral hearing to contest that view. Neither Mrs Gray nor her representatives are required to attend any hearing.

The Court's general approach to these cases.

13. On 4 March I rejected an application by Mr Gopee for orders to be made without a hearing in the case of Ogunleye. Some of the reasons which I gave may apply to other cases too so I summarise them now:

"I have frequently stated in these cases that each needs to be examined on its merits. However the apparently serious illegality of the loans and the potentially grave consequences for Defendants combined with the fact that the Claimant appears generally to have failed to give a candid account to the Court when obtaining judgment, means that permission will usually be given on judgment will be set aside unless a Defendant has had consistent access to informed representation or has been able competently to represent him or herself. I have reconsidered the position in the light of recent changes to the approach to deadlines in litigation and reaffirmed that view. I refer to my decisions in Barons Finance and Reddy Corporation-v-Makanju [2013] EWHC153 (QB) and Gopee [2014] EWHC 138 (QB) where I have set out more detailed reasons. Those considerations apply in this case.

I have repeated explained to Mr Gopee that if there are any reasons, which I have not considered before, to believe that the loans underlying this litigation are arguably lawful and enforceable I will be pleased to consider them.

Human Rights etc. Mr Gopee argues in effect that I am biased and he is denied access to justice because all his cases are managed by me. I see his point of view in that, having formed a view about the legal issues, as opposed to the facts of a particular case, that view will not change until some new factor persuades me otherwise or the Court of Appeal decides that I am wrong. I do not see consistency as bias but I recognise that Mr Gopee has now appeared before me many times. For that reason I will ensure that if any of these cases reaches trial and requires resolution of questions of disputed evidence involving Mr Gopee, it will be heard by a judge other than me.

Mr Gopee complains about not knowing what case he is going to face when he comes to Court. It is the case that on some applications Defendants have appeared seeking relief without giving the Claimant notice of their application. When that happens I refuse relief and give Mr Gopee an opportunity to be heard at a later date. It also happens that hearings are sometimes made futile because Mr Gopee, the Defendants, or sometimes both, have failed to comply with procedural directions. Confusion sometimes occurs because both sides misunderstand High Court procedures. However no case has been or can be listed without notice to the parties. On the specific matter of Mr and Mrs Ogunleye Mr Gopee has not sought to identify the facts which it is suggested that the Court has overlooked.

Mr Gopee has often referred to these cases being before the Court of Appeal but I have seen no judgment from that Court. This may be because Mr Gopee has been refused permission to appeal. As there are now potentially more than 400 cases affected by the views that I have formed it may be that the Court of Appeal should have an opportunity to review them. If Mr Gopee will inform me what the position is with his applications to the Court of Appeal so that I know how many are pending and which have been granted and which refused permission, I will consider granting him permission to appeal under CPR 52.3 (6) (b). Any such permission will be in case 967 not in that of Ogunleye."

Decision of the Court of Appeal

14. On 28 March 2014 Lord Justice Christopher Clarke in a reasoned judgment following a hearing refused permission to appeal against the decision of His Honour Judge Simpkiss in Ghana Commercial Finance Ltd v Sawyer. All parties in these cases should read that decision.

Position of the Liquidator of Barons Finance Limited

15. Mr Gopee remains in dispute with the Liquidator. The issues between them are encapsulated in the following extract from a letter from the Liquidator's solicitors to the court dated 7 February in the Dewal case:

"The Liquidator objects to the making of the order substituting Speedy Bridging Finance Limited as the Claimant in these proceedings.

The Liquidator is in the process of investigating the assets and liabilities of the Company. However, in his opinion, his investigations have been hampered by a back of cooperation on behalf of the director of the Company, Mr Gopee. Mr Gopee has alleged that the loan book of the Company has been transferred to Barons Bridging Finance One Limited and Reddy Corporation Limited on 31 March 2012. Mr Gopee is a director of both of these companies. It would appear that Mr Gopee is alleging that a further transfer has now occurred, the motive behind such transfer is questionable in view of a previous order of HHJ Mackie QC in respect of Mr Gopee and the threat of proceedings against Barons Bridging Finance One Limited and Reddy Corporation Limited.

Mr Gopee's position is not accepted by the Liquidator. In particular, the date of the alleged agreement, the motive behind the alleged transfer and whether it was made at all are all challenged. The Company was involved in court proceedings at this time and the Defendant in those proceedings had already obtained a default costs' certificate against the Company in the sum of £16,243.23 on 28 October 2011. On 4 April 2012, a demand was made for payment of the default costs' certificate.

It is the Liquidator's position that the transaction is liable to be set aside under sections 238, 239 and 423 of the Insolvency Act 1986 on the basis that it is either a transaction at an under value, a preference or a transaction to defraud creditors. We are in the process of preparing the necessary court papers to deal with setting aside the transaction.

The Liquidator has also identified that various charges in favour of the Company were transferred to third parties after the winding up petition was issued. The Liquidator has not been provided with a copy of the validation order and as such the transfers are void under ection 127 of the Insolvency Act 1986."

The Insolvency Service

16. The Court has this month received a letter dated from Mr Daniel Slater of The Insolvency Service stating that he has been authorised by the Secretary of State to conduct an investigation under S.447 of the Companies Act 1985 into twelve companies associated with Mr Gopee. He says that Mr Gopee is no longer cooperating with his investigation and has asked for information about the litigation. The Court will therefore send him a copy of this Summary.

Financial Conduct Authority

17. I referred in the Gopee judgment of 5 February to the decision of the OFT to take no further action itself. The Court is unaware of the Financial Conduct Authority, which has succeeded to the role of the OFT but with increased powers, taking any action either.

Copies

18. I am publishing this summary like a judgment so that it comes to the notice of the many parties to these cases. Copies will also be sent to Mr Gopee, the Liquidator's solicitors, HM Land Registry, The Insolvency Service, the Financial Conduct Authority, and the administrator in the Court of Appeal dealing with these cases.