England and Wales High Court (Technology and Construction Court) Decisions

IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
BIRMINGHAM DISTRICT REGISTRY
TECHNOLOGY AND CONSTRUCTION COURT

		Claim No. C50BM042 Priory Courts 33 Bull Street Birmingham B4 6DS
		22nd May 2017

 


HIS HONOUR JUDGE GRANT:

1. This is an application for an order for committal. The application notice is dated 31^st March 2017 and it is for an order for committal against Central Hall Developments Limited and/or Mr Jagtar Singh as its director arising out of the defendant's failure to with paragraph 1 of the order made on 13^th January 2017. Central Hall Developments Limited is the defendant in these proceedings. Overleaf, the application notice sets out the grounds as follows:

"Paragraph 1 of the court order made on 13^th January 2017 required the defendant by 24^th February 2017 to effect a policy of insurance in respect of the property known as The Central Hall at Corporation Street, 196 to 224 even numbers and 5 Ryder Street in Birmingham and in accordance with the defendant's obligations under clause 3(c)(i) of the headlease current between the claimant as tenant and the defendant as landlord relating to the property; and (2) The defendant has without providing any reasonable excuse failed to comply with the order."

2. By way of background, the building is a substantial Victorian civic building in the centre of Birmingham (see the report of Bruton Knowles which is at page 1/B/1 of the application bundle). Clause 3(c)(i) of the lease required the landlords to covenant in the following terms:

"At all times during the said term to insure and keep insured the property, including for the avoidance of doubt the premises, in a sum sufficient to cover the cost of completely reinstating the same in the event of total destruction together with architects and surveyors fees and other expenses incidental thereto against loss or damage by fire, lightning, storm, flood and tempest, explosion, aircraft and articles dropped therefrom and such other risks as the landlord may from time to time determine in an insurance office of repute and to pay all premiums and other monies necessary for this purpose…"

3. The claimant is and remains the tenant of the ground floor and basement. They comprise the premises as referred to in clause 3(c)(i). The property is Central Hall. The renewal date for the then current insurance was 1^st July 2016, and the insurers then involved caused an inspection to be carried out by a Mr Ian Johnson, which was done on 27^th May 2016. Mr Johnson then generated the document entitled "Insurer's requirements" which is at page 2/B/40. He identified nine items, each of which had to be carried out within a defined time scale.
4. Item 1 related to LPG and paraffin heaters. Their use was stated to be unacceptable and had to be removed, and was classified as urgent.
5. Item 2 related to unoccupied units, and the requirements were that they had to have "The gas, electricity… and water supplies turned off at the mains and all water pipes, apparatus and tanks drained down". That was classified as priority 1, which meant that that had to be done within four weeks.
6. The remaining items, 3 to 9 inclusive, were all classified as being priority 3, which meant they had to be done within three months.
7. Condition 3 was that a condition survey had to be undertaken by a suitably qualified building surveyor, and that had to be submitted to the Ecclesiastical, who were the then insurers, whereupon a programme of works was to be agreed with the Ecclesiastical.
8. Item 4 was the plumbing check: "The insured must arrange for an inspection to be carried out of the entire plumbing system in the premises…"
9. Item 5 related to the kitchen hood fire suppression systems, and the requirement was that they had to be fitted with fixed fire suppression systems complying with defined standards.
10. Item 6 related to the hot work permit system, the requirement being that the insured had to adopt a hot work permit system.
11. Item 7 related to lightning conductor maintenance, the requirement being that the insured had to visually inspect all conductor ribbons, any break in the ribbons had to be repaired immediately and that at intervals of not more than two years the insured had to arrange for the whole system to be examined and tested by a competent specialist firm of lightning engineers, the method of testing had to be in accordance with the defined standards, and finally "A certificate must be issued by the contractor on completion of the lightning conductor examination and testing and a copy forwarded to this office".
12. Item 8 related to fire alarms, the requirement being that the insured had to protect the building by an automatic fire detection system. Item 9 related to the electrical inspection, the requirement being that an electrical installation had to be inspected by a qualified electrician or electrical contractor qualified to NICEIC standard or other comparable standard and that a full copy of the electrical installation condition report issued by the contractor on completion of the inspection had to be forwarded to the insurer's office.
13. So those were the insurance requirements. As I have stated, the renewal date was 1^st July 2016. On 18^th July 2016, Mr Adrian Walsh of Bruton Knowles prepared a detailed report on the property. Clause 3(c)(i) went on to provide that if the landlords should at any time fail to insure and keep the property insured the tenants could effect and maintain such insurance, and any monies expended by the tenants should be repayable by the landlords to the tenants on demand; and finally that the tenants shall be at liberty, if they so require, to have a note of their interest endorsed on the policy or policies of insurance.
14. The defendant had not paid the relevant premium, with the consequence that on 4^th November 2016 the claimant paid a premium of £71,720. That, of course, was not insurance for the whole of the property but only in respect of the premises; importantly, given the size and age of the property, that did not include the provision of cover for the roof or any other parts of the main building which comprised the property which were not included in the demised premises. However, that cover terminated on 25^th November 2016, and shortly afterwards on 1^st December 2016 these proceedings were issued.
15. That led to the making of the order of 2^nd December at which undertakings were given. On that occasion undertakings were given by Nashatar Singh Bains, who appears to be an agent acting on behalf of the defendant, and the defendant through its director, Mr Jagtar Singh. Each of those two persons undertook to the court as follows:

"Firstly, to comply with the requirements date of inspection, 27^th May 2016… [those are the insurer's requirements to which I have just referred]; and, secondly, to use best endeavours:

(a) to prevent any nightclub activity or similar event on 10^th December 2016, including by informing the licensing and fire authorities that the landlord has no insurance in respect of the property, all of that by 4pm on 6^th December 2016; and

(b) to recover or obtain vacant possession from the nightclub operator at the property by 12^th January 2017."

Those references to nightclub activity and/or nightclub operator are references to a body elsewhere referred to as The Q Club.

16. The matter came back before the court on 13^th January 2017, and on that occasion a consent order was made in the following terms:

"1. That the defendant by 4pm on 24^th February 2017 effect a policy of insurance in respect of the property known as The Central Hall… in accordance with the defendant's obligations under clause 3(c)(i) of the headlease… For the avoidance of doubt, effecting a policy of insurance includes complying with or undertaking to comply with any requirements of the insurer, whomsoever that might be."

2. The defendant by its director, Mr Jagtar Singh, who is also known as Jack Mann, and by its agent, Mr Nashatar Singh Bains, shall file at court and serve on the claimant witness statements by 20^th January detailing all steps that each of them took to comply with their undertakings to the court dated 2^nd December 2016 and exhibiting any relevant letters of instruction, invoices, or other supporting or relevant documents."

So those are the relevant undertakings and terms of the consent order which was made on 13^th January 2017.

17. There are a number of witness statements and/or affidavits in the application. The claimant's (in fact a witness statement) in support of the application is that of Mr Dangoor. It is dated 3^rd April 2017. In paragraph 3 he refers to the fact of the initial order made on 2^nd December 2016 when undertakings were given. In paragraph 4 he refers to the requirements being those issued by the insurers following a survey of The Central Hall. In paragraph 5 he stated as follows:

"As a result of the defendant's failure to comply with the requirements, insurance on the property as paid for by the claimant due to the defendant's failure to pay was withdrawn save in respect of limited cover for the claimant's demise on 29^th November 2016…"

In paragraph 6 he stated: "In breach of the undertakings, the requirements were not complied with by 12^th January".

18. Then in paragraph 7 he continued:

"The defendant has still not obtained insurance cover in respect of the property. Alasdair Wardrop of Arthur Gallagher, the insurance brokers who originally brokered the Ecclesiastical policy, has told me that he has had some contact with the defendant since the hearing on 13^th January. He confirms that he has told the defendant that the insurers are requiring compliance with the requirements in order to reinstate insurance. In particular, the insurers require a condition survey to be undertaken by a suitably qualified building surveyor submitted to Ecclesiastical whereupon a programme of works must be agreed with the Ecclesiastical. Electrical and fire alarm certificates are also to be provided. These are matters which under the requirements as initially issued should have been completed by no later than 9^th September 2016."

In paragraph 16 he stated that whilst the claimant has some insurance on its demise it is not full cover, and does not cover any peril originating from outside of the demise. In paragraph 20 he stated:

"In view of the defendant's failure to comply with paragraph 1 of the order made on 13^th January 2017, or to provide any reasonable excuse or time scale for doing so, I respectfully request that the court fines the company and/or its sole director, Mr Jagtar Singh."

19. The respondent's affidavit in answer is that of Mr Singh. It is dated 3^rd May 2017. In paragraph 2 Mr Singh states:

"It is accepted that the order dated 13^th January 2017 required the defendant by 24^th February 2017 to effect a policy of insurance in respect of… The Central Hall."

In paragraph 3 he stated:

"I admit that I/the defendant did not meet that deadline and I/the defendant apologise to the court and claimant sincerely but I provide this affidavit to explain the reasons for this."

He went on to submit that there were good reasons for that being the position. In paragraph 5 he stated as follows:

"Unfortunately, during December we were unable to secure dates for the contractors to attend to make initial visits. Thereafter, due to the issues with access to the area occupied by The Q Club, the nature and extent of the works and costs were substantially higher than anticipated. I admit that Nash and I underestimated the time scales it would take to comply with the requirements."

I pause to interpolate that The Q Club occupied the first floor.

20. At paragraph 7 he refers to a detailed chronology which he had prepared, together with a paginated bundle of supporting evidence. In the succeeding paragraphs he described the relationship between the respondents and The Q Club. At paragraph 11 he stated:

"By the date of the hearing, in fact, of 12^th May we anticipate being in a position to have insurance in place provided that the condition survey is accepted by an insurer."

In paragraph 15 he stated:

"We deny that we have allowed the property to fall into a state of considerable disrepair. We have spent about £180,000 on the building."

And in paragraph 21 he stated:

"I apologise again for the breach of the court order. I realise it is a serious matter but have set out the reasons for the failure to insure. It is not a case, as seems to be suggested… that I/Central Hall are doing nothing. We have spent around £25,000 since December doing the works required by the insurers."

21. Mr Dangoor put in an affidavit in reply, dated 5^th May 2017. By reference to Mr Singh's detailed chronology and cross referring that back to the insurer's requirements, it therefore appears that the position as at 3^rd May was as follows. So far as requirement number 3 was concerned, although as Mr Singh states (see page E/174):

"PRP Structural Engineers instructed to carry out condition survey carried out from beginning April – awaiting final report which will then be provided to insurer's for approval and issue of cover note of insurance."

Although that that was expected by the end of April 2017, it had not by then been received, and Mrs Talbot who appears today on behalf of both respondents confirms on instructions that, in fact, no such report is in evidence. So far as the requirement number 7 is concerned, lightning conductor maintenance, although a number of documents were exhibited to Mr Singh's affidavit (see pages E/200 to 202) they do not contain a certificate as required by the insurance requirements.

22. Then as regards requirement number 9, the electrical inspection: a deal of material was exhibited by Mr Singh (see pages E/228 to 239). While I accept that material may reasonably be construed as answering the description of an electrical installation condition report as required in the insurer's requirements (see page E/228 in section E headed, "Summary of the condition of the installation"), the general condition of the installation in terms of electrical safety was stated to be unsatisfactory, and the overall assessment of the installation in terms of suitability for continued use was also described as being unsatisfactory, and that description carried an asterisk which defined that term as follows:

"An unsatisfactory assessment indicates that dangerous and/or potentially dangerous conditions have been identified."

23. The position was therefore that until about five o'clock or so, ie late on the afternoon of 10^th April 2017 (and that is nearly six months after proceedings had been issued, and only a little short of the anniversary of the date when cover fell to be renewed back in 2016), the defendant had not satisfied or complied with the insurance requirements in three material respects. There was no condition survey report; there was no certificate as regards lightning conductor maintenance; and albeit an electrical inspection had been carried out and a condition report had been issued, the overall assessment was that the condition of the electrical installation was unsatisfactory in the sense of being dangerous and/or potentially dangerous.
24. It is to be noted that a penal notice had been attached to the order of 13^th January 2017. I remind myself that in matters of this nature the court must proceed with care (see the notes at paragraph 18.0.1 of the current edition of 'Civil Procedure').
25. In his written submissions prepared for 12^th May 2017, Mr Verduyn submitted in paragraph 11 as follows: "The breach was plain and significant, no effort had been made to extend time for compliance with the order". He observed that the insurance eventually obtained with the Zurich "is not with the previous insurer but there had been no explanation for why it was so late…"
26. In her written submissions prepared for the hearing on 12^th May 2017 Mrs Talbot submitted in paragraph 4:

"The defendant had admitted the breach and unreservedly apologised for it. However, the breach, subject to some technical points addressed below if the application to adjourn was not successful, has now been remedied."

I accept both of those submissions. The consequence, of course, is that the court is dealing with the admitted breach of an initial undertaking and of a subsequent order which was expressed to be made by consent. I also remind myself that these are civil proceedings in which the substantial rights of the parties remain to be determined.

27. In addition to the substantive witness statements and affidavits, pursuant to the order made on 12^th May 2017 Mr Singh has filed two affidavits of means, one in relation to the company of which he is the sole director and the other in relation to himself in his personal capacity, and I have read both of those.
28. Mrs Talbot makes a number of points in mitigation both in her written submissions and as developed orally this afternoon. In paragraph 14(a) she makes the point that the breach is admitted and an apology is offered, and I take those points into account and have proper regard to them.
29. At 14(b) she makes the point that insurance is now in place. It is. That is a material change of circumstances which has occurred since the application was made.
30. At point 14(c) she makes the point that the schedule of works proposed by insurers was lengthy, and Mr Bains underestimated how long it would take to carry out the works at the initial hearing (that is the hearing on 2^nd December 2016). The difficulty, of course, with that submission is that it does not provide a full or adequate explanation as to how it was that initially undertakings were given and then that's an order was made, as it was, by consent.
31. At paragraph 14(d) Mrs Talbot submits that the claimant had been on notice of how the works were progressing due to their agents being on site on a weekly basis. That is a reference to Bruton Knowles but, as was referred to in the course of oral submissions this afternoon, there is no direct evidence from anyone at Bruton Knowles as to the nature or extent of any notification that they had or their understanding or appreciation of how matters were proceeding on the ground.
32. At paragraph 14(e) the point is made that the defendant has sought to get the property insured throughout, and a detailed chronology of their efforts is in the bundle and I have already referred to Mr Singh's detailed chronology. As I have already observed, while indeed that chronology records various matters being undertaken, there were still material and significant respects in which the insurer's requirements had not been complied with as at the date the application was made.
33. In paragraph 14(f) Mrs Talbot submits as follows:

"The defendant could not gain access to the upper levels to do the works and were repeatedly told by The Q Club that they were leaving. Notice was served and The Q Club did move out on 10^th February 2017 when much more progress was possible."

Mrs Talbot developed that point in the course of her oral submissions. She submitted on instructions that The Q Club was a substantial operator of a nightclub, they had expensive equipment on the first floor, they had something of a falling out with the claimants and that the claimants sought to assist or enlist the aid or support of various of their subtenants so as to stop The Q Club operating through the medium of opposing the continuation of the relevant licence.

34. In the event, those efforts turned out to be unsuccessful, but the consequence or a material consequence was that The Q Club blamed the defendant, Central Hall, for what had happened, and as a result The Q Club took a somewhat entrenched position. The practicality was that it was The Q Club who was running or maintaining the intruder alarm. However, there was no written agreement either as regards occupation and/or responsibility for the intruder alarm as between The Q Club and the defendant, and although the defendant had been trying to negotiate with The Q Club with a view to agreeing The Q Club vacating the first floor premises which it occupied, the defendant was of the view that it did not have sufficient legal understanding or a sufficiently strong legal basis to press the point with The Q Club.
35. That aspect of the matter is the point which Mrs Talbot developed in paragraph 14(g) of her written submissions where she submitted:

"The Q Club claimed to have a protected business tenancy and threatened legal action when asked to leave. Such litigation would have been expensive and protracted which would have further delayed the work so an amicable approach was taken which did eventually resolve the situation."

There was such resolution when The Q Club did eventually vacate on 10^th February 2017. In her oral submissions Mrs Talbot made the further point that although the defendants had instructed solicitors, those solicitors, certainly so far as the defendant perceived the matter, did not provide them with sufficiently detailed or clear legal advice as regards the nature or the legal basis of The Q Club's occupation, in particular whether they held pursuant to a lease or to a licence.

36. In paragraph 14(h) of her written submissions Mrs Talbot submitted that Mr Dangoor was made aware of progress on 17^th February 2017, but still sought to issue the committal application, which the defendants submit was an application made prematurely in view of progress being made. In her oral submissions Mrs Talbot referred to a meeting that had taken place whereby Mr Singh and Mr Bains attended on Mr Dangoor at his London address, gave him what they thought was a full update of progress and, as a result, were surprised when the application to commit was, in fact, made. A point to be borne in mind in this context is the fact that as at the date the application was made the defendant had still not complied in a material extent with the insurer's requirements and there was, in fact, no insurance in place.
37. In paragraph 14(i) of her written submissions Mrs Talbot submitted that the defendant had kept exploring insurance prospects through brokers throughout the litigation process, and that essentially it was only through the difficult process of finally exiting The Q Club that the defendant could then inspect, carry out works, carry out testing and obtain certificates. In her oral submissions she developed that point by telling me on instructions that once The Q Club had gone, through brokers, Orbit Management, the defendants were able to learn that they could obtain insurance from the Zurich, which they have now done, but that only became possible once they had put in place the provision of 24/7 security, which is the attendance of security guards attending on a shift basis around the clock at a cost of some £2,000 per week. I note that that sort of detail was not in the affidavits, but I accept the points being advanced on the respondents' behalf in mitigation. Mrs Talbot explained that the defendant did not, in fact, take over the arrangement which The Q Club had already had in place, but they provided the same level or type of 24/7 security as previously it had been put in place at the behest of The Q Club.
38. At paragraph 14(j) Mrs Talbot submitted that the defendant had not simply sat back and done nothing; approximately £180,000 has been spent on the building and, indeed, £25,000 since December 2016.
39. As regards their respective means: so far as the defendant, the first respondent, is concerned, its abbreviated accounts for the year ended 31^st March 2015 are at page 279. Mr Verduyn makes the point that in the abbreviated balance sheet the figure for stocks is shown at a little over £1 million (£1,090,086), and that it is difficult to understand the basis upon which that figure was derived when the policy which the respondents have been able to obtain from the Zurich records a building sum insured of £20 million. That is by reference to the certificate of insurance, effective date 10^th May 2017, which Mrs Talbot produced to the court on 12^th May.
40. Be that as it may, in the abbreviated balance sheet creditors are shown in the figure of approximately £2.3 million, which then produced a net current liability of a little over £1 million. While in those abbreviated accounts both Mr Singh and a Mr K S Dhaliwal are recorded as directors, Mrs Talbot tells me on instructions, as is stated by Mr Singh in his affidavit, that he is now the only, ie the sole, director of the defendant. Mrs Talbot also tells me on instructions that neither Mr Singh nor Mr Dhaliwal are now shareholders, and that the only shareholders are Mrs Sukhjit Kaur Dhaliwal and Mrs Carmjit Dhaliwal, ie those noted as having shareholdings 4 and 5 on page 288.
41. So far as his personal means are concerned, by his witness statement Mr Singh states that he owns a property at 315 Liverpool Road in London N7, that there is a mortgage on it of approximately £311,000. There is no evidence about the purchase price that he paid and there is no evidence as to the current value of that property. In paragraph 4 he stated, as I have already mentioned, that he is the sole director of the defendant and that he is also a director of a number of other companies. As Mrs Talbot put it in her oral submissions this afternoon, he works effectively as a property developer and, thus, his income is sporadic. In paragraph 6 of his affidavit of means he estimated that on average he received about £4,000 income per month and in paragraph 7 he sets out items of expenditure coming to almost the same amount, namely £3,832. Mr Verduyn told me that he had carried out an analysis of the bank statements that had been exhibited by Mr Singh which suggested an income of a little higher than £4,000, a figure above £5,000.
42. In paragraph 9 of his affidavit of means Mr Singh stated that he also had personal loans totalling in the region of £200,000 but I have little, if any, information about those. Mrs Talbot did, however, take me to the document at page 294 which shows a revised schedule of repayments on the mortgage. This is a letter from NRAM Debt Management and I will assume for present purposes that that refers as the footnote at the bottom suggests, Northern Rock Asset Management Plc. It is dated 18^th January 2013 and it, in effect, shows a revised arrangement for monthly mortgage payments from the beginning of January 2013 through to the end of November of this year whereby monthly payments would go up from £1,247 to £1,404 odd and then for a final month a slightly smaller figure of £1,374 odd. Mrs Talbot submitted that that reflected some financial difficulty that Mr Singh had got into at around that time by reason of a downturn in the various property businesses in which he was involved.
43. In his oral submissions this afternoon Mr Verduyn submitted that the following was relevant by way of background: that there was a significant period here of time when the defendant had not put in place insurance as it had covenanted to do, as a result of which the defendant had to pay a premium of £71,000 odd, and although there is a debate between the parties about apportionment of that figure, it is the defendant's case that its liability would have been about 60 percent of that figure. The claimant, in fact, contends for a figure slightly higher, but taking the defendant's figure of 60 percent, that would indicate a liability on an annual basis for cover of that degree of the order of £42,600. Looking here, as we are, at a period of something of the order of six months there was thus a period of approximately 6 months in which the defendant did not pay a figure expressed in round terms of the order of £20,000.
44. Those are therefore some of the material facts by way of background. I have been referred to a number of authorities so far as sentence or penalty is concerned. It is right before turning to those, thus, to summarise that in contrast to the position which obtained when the application was made, the defendant has now effected insurance. There are other matters that remain to be attended to, but the property is now insured in respect of a 'building sum insured' of £20 million.
45. I accept that both respondents encountered material difficulties in obtaining access to parts of the property which were occupied by The Q Club, but those difficulties ceased upon The Q Club vacating, which it did on 10^th February 2017. Notwithstanding all the points that Mrs Talbot has identified in her mitigation, it remains the position that both respondents were in breach of the relevant undertakings and of the consent order for a significant period of time. Mr Verduyn sought to analyse the period of time in paragraph 8 of his written submissions where he submitted that compliance by 10^th May (that is the date that cover was obtained by the Zurich) was 119 days after the undertaking expired and 76 days after the order expired.
46. At the rear of the current edition of Arlidge, Eady & Smith on Contempt in appendix 3 are notes of a whole series of cases in which penalties have been imposed from around 1982 up to 2011. In two cases, Gill v Darroch [2010] EWHC 2347 and JSC BTA Bank v Solodchenko [2010] EWHC 2843, the court was of the view that in the respective circumstances which obtained in each of those cases, an order to costs in each case on the indemnity basis was sufficient by way of disposal of the applications for contempt in those cases. However, here the court is concerned with admitted breaches of undertaking and a consent order during a significant passage of time and in those circumstances I have come to the conclusion that this is a case where it is necessary or appropriate for the court to impose a fine as the appropriate means of dealing with the application.
47. In his oral submissions today Mr Verduyn referred me to two further cases: firstly, Alstom Power Ltd v Somi Impianti [2011] EWHC 3941 which was a case in which the respondent to the application had given undertakings to deliver specific documents. I am not provided with the underlying circumstances of that case but I assume from the identity of the parties that it involved matters of substance both as regards financial substance and of underlying factual complexity. In that case a fine of £40,000 was imposed, albeit on that occasion the court expressly stated that it would be prepared to consider an application to reduce the fine if and when the relevant injunction had been complied with properly. Secondly, in the case of Wokingham Borough Council v Dunn [2014] EWCA Civ 663, the appellants had failed to comply with an injunction to clear a site and restore land by top soiling and re-seeding and not permit further occupation of the land and the breaches had been flagrant and there an initial term of imprisonment was reduced to the imposition of a financial penalty, namely the passing of a fine of £20,000. Pausing there, it would strike me that there would be two material differences between the circumstances of that case and the present: firstly, in that case there was a plain public element to the case in the sense of orders for restoration of land and non-permission of further occupation; and secondly, a finding that breaches had been flagrant, and I make no such finding in this case.
48. On behalf of the respondents Mrs Talbot referred me to the decision of Mr Justice Males in Westminster City Council v Addbins & Ors [2012] EWHC 4389 in which a fine of £5,000 was imposed. There, the short note that has been handed in states as follows:

"The applicant local authority had successfully applied to have D committed for contempt of court following their failure to comply with the court order that had required them to take down cigarette bins that had been erected in breach of the Town and Country Planning (Control of Advertisements) Regulations of 2007 and in that case the Court of Appeal held that while it was not an example of the most serious contempt, the defendant had made only a half-hearted attempt to comply with the order and that it was inevitable that the defendant would have incurred the cost of complying with the order once it had been made. Those costs could not be counted as part of any sanction for the contempt and that while it might be there were some cases where no further sanction was appropriate as the findings of contempt and the cost of the proceedings in themselves would be sufficient. This case was not such a case and it was appropriate to mark the contempts provided with a further sanction and thus it was that Mr Justice Males imposed a fine of £5,000 as being the appropriate sanction for the circumstances of that case."

49. Mrs Talbot submitted that the circumstances of the present case were not as serious as those in Westminster City Council. I have come to the opposite view, and regard the circumstances of the present case as being rather more serious than those in Westminster City Council. That is because the underlying nature of the obligations in this case, calling for the insurance of a substantial Victorian civic building in the city centre in Birmingham, strike me as being of rather more import or seriousness than the requirements as regarding the provision of cigarette bins to which planning regulations relating to the control of advertisement apply. Nonetheless, I accept Mrs Talbot's further and more general submission that Westminster City Council is of assistance in indicating the general bracket or nature of fine that ought properly to be imposed.
50. Taking all those circumstances into account, as I do, I have come to the following conclusions. I bear very much in mind the point that has been made that a fine cannot be imposed on a joint and several basis and therefore I approach the matter this way. Firstly, to regard what is the appropriate level of fine in general terms. Mrs Talbot then made a further submission that I should weight such fine the more to the first respondent, the company, than to Mr Singh himself. I am not persuaded that that would be a correct approach, in particular because to a very significant extent Mr Singh is the personal servant or agent of the defendant/the first respondent, he is the sole director, so to that extent he is the 'heart and mind' of the company. In my judgement, the evidence does not establish any appropriate or proper basis upon which the amount of overall fine should be weighed more heavily towards the first respondent than towards the second respondent. I shall therefore apportion the fine equally between the respondents. The overall fine is to be £7,500 and it is to be expressed as one fine of £3,750 (that is half of it) on the company, the first respondent, and the other half on Mr Singh, the second respondent, in his personal capacity.
51. As I have already mentioned in the course of oral submissions, I have also to identify a term of imprisonment which is to be served in default of payment. There is a table which sets out the relevant maximum terms, which is to be found in section 139 (4) of the Powers of Criminal Courts (Sentencing) Act 2000. Here, looking at the individual fines, as I do, they fall within the bracket of an amount exceeding £2,500 but not exceeding £5,000. The maximum term of imprisonment defined there for default of payment is 3 months, and in the present circumstances the appropriate term of imprisonment for me to identify in default in payment of the fine is a term of 6 weeks.
52. Insofar as the first respondent is concerned, as already observed in the course of oral submissions, any such term of imprisonment is to be served by Mr Singh as its sole director. So, while the financial interests of the first respondent may well involve any shareholder or any other investor, were there to be any default, that would result in a personal peril for Mr Singh.
53. I am empowered to direct that any fine may be paid by way of instalments, and I shall therefore invite submissions from Mrs Talbot as to the appropriate amount and timing of any such instalments.
[Discussions re order follows]