Jersey Unreported Judgments

[2009]JRC171

royal court

(Samedi Division)

26^th August 2009

IN THE MATTER OF AN APPLICATION FOR THE DEFENDANT TO ADDUCE EXPERT EVIDENCE.

AND IN THE MATTER OF JOINING HANAU LIMITED AS A THIRD PARTY TO THE PROCEEDINGS.

Advocate O. A. Blakeley for the Plaintiff.

Advocate M. P. Renouf for the Defendant.

Advocate R. J. C. Wakeham for Hanau Limited (present but not made a party).

judgment

the commissioner:

1.        Two applications were raised before me by the defendant at a directions hearing on 25^th August upon which I reserved my decision.  These applications have to be seen in the context of the history of delay in this matter.  The trial dates were originally fixed for the 27^th and 28^th July and have been vacated for a new trial, now fixed for 17^th and 18^th September. 

2.        Primary responsibility for that delay was placed by the Bailiff upon the defendant.  The defendant now raises these new issues.  Firstly, Wildman Investments Limited ("Wildman"); it is agreed that the monies invested in this case in fact came from Wildman, an English company which has been struck off.  The defendant has a number of concerns which he expresses through his counsel as follows:-

(i)        Firstly it would be wrong for the Court to simply equate Wildman and Mr Rudman (the plaintiff) as being the same party; they are not.  Any assets of Wildman that are reinstated may belong to creditors and shareholders.  The defendant does not want to pay funds over to the plaintiff only to discover that Wildman and/or its creditors and/or other shareholders then pursue him in relation to the same matters. 

(ii)       Secondly, the defendant poses the question as to whether he is actually being sued by the right party.  Should Wildman be the plaintiff or a second plaintiff?  Does it need to be reinstated before trial?

(iii)      Thirdly, as matters currently stand the defendants says there is a fundamental hole in the plaintiff's case.  He has adduced no evidence to show that he invested £150,000.  He has provided no proof that he provided cause or consideration.  The defendant says his claim as presently stated would fail.  Thus the defendant concludes that the plaintiff needs to provide the required information and get his house in order e.g. who were the legal and beneficial owners of the company?  Were there any creditors?  Why did it pay the funds across?  Did it owe the funds to the plaintiff and if so why?  And what is the proof et cetera?  And the defendant, hence his application, needs to obtain English legal advice, English law standing as a question of fact for the Royal Court to be determined at trial, on the lack of that evidence.

3.        The plaintiff takes exception to this issue being raised now.  It submits that it is not an issue, in that in clause 2(b) of its further and better particulars the defendant pleads as follows:- "for the avoidance of doubt the defendant has no reason to doubt that the plaintiff paid £150,000 to Anchor nor that that sum of money was received by Hanau" 

4.        The plaintiff wishes to proceed with his claim as pleaded i.e. that investment was made by the plaintiff and not by Wildman.  I have not seen the evidence that the plaintiff will give in this respect but he will presumably have an explanation as to the source of the funds he will allege that he invested.  Be that as it may, the plaintiff wishes to have his case as pleaded heard before the Court.  I have to say I have some doubt as to the concerns expressed by the defendant in that these monies were paid over via Wildman in December 1999 and May 2000, some nine to ten years ago.  Any claim that Wildman may have had against the defendant or Hanau Limited has presumably never been pursued and the company now no longer exists as a legal entity. 

5.        However I can see that evidence as to the status of Wildman under English law may possibly be of assistance to the Court and I therefore grant to the defendant leave to adduce expert evidence as to English law regarding the status of Wildman, such evidence to be filed by way of affidavit by close of business on Friday 4^th September, 2009.  The plaintiff shall have liberty to file an affidavit in reply by Friday 11^th September, 2009.  I say in passing that this evidence should not be controversial and I would have thought it would be well capable of agreement. 

6.        Turning to the second application the defendant applies to join Hanau Limited ("Hanau") as a third party pursuant to rule 6 (10) (1) of the Royal Court Rules 2004.  In essence the defendant says that the agreement, if one is found to have been made, was made with Hanau and not the defendant.  Advocate Renouf made the following submissions:-

(i)        Firstly in his view the plaintiff ought to have added Hanau as a party long ago as the Court will not have the option of making orders against the company if it finds the agreement in this case was made with Hanau and not with the defendant personally. 

(ii)       Secondly, his client does not wish this trial to be duplicated by a second trial being commenced against Hanau if this action fails, with the attendant waste of time and costs involved all round. 

(iii)      Thirdly he says there is no procedural disadvantage of Hanau being joined at this stage as the defendant is a director of Hanau and has already made discovery of all the companies named records relevant to the case, and both the defendant and Hanau are ready to file their pleadings immediately.  There is no need to call any further witnesses. 

7.        The defendant's proposed claim against the third party Hanau is framed as follows:-

(i)        Firstly, that the third party is responsible to the plaintiff for the actual agreement or such agreement as the Court should conclude took place. 

(ii)       Secondly, that the third party should perform such agreement or pay such damages to the plaintiff as the Court shall deem fit. 

(iii)      Thirdly, that the third party shall indemnify the defendant in relation to the plaintiff's claims.

Thus the defendant pleads that Hanau should be the real defendant but if the defendant is found to have any liability to the plaintiff, he seeks an indemnity from Hanau.  Hanau appeared at the hearing and consented to being joined for the reasons put forward by Advocate Renouf.  I was told that Hanau is owned by a Jersey trust known as The Tulip Trust established for, or in some way connected with the defendant's family.  I have also been told, as already recited, that the defendant is a director.  It also owns the flat occupied by the plaintiff and has some limited cash in a bank account.  Hanau will accept formally that there was an agreement and that it was reached with it and not with the defendant.  Its voluntary appearance before us and willingness to be engaged in this litigation together with the defendant's role as a director and his concern for costs that might be incurred by Hanau subsequently, indicate to me that the defendant has some influence over Hanau.

8.        The plaintiff again protests to this issue being raised so late, his case is that the agreement was entered into with the defendant and not Hanau and that is the case he wishes to have heard in September.  He accepts the risk that if this Court finds that the agreement, if there was one, was not made with the defendant then he will have to re-litigate the issue against Hanau with the resulting waste of costs.

9.        Advocate Blakeley referred me to the Court of Appeal decision of Brown-v-Barclays Bank 2001/241, a case concerned with a late application to amend a pleading in which Southwell J.A. said this:-

"Where there is a late application for an amendment to the Order of Justice (or to the answer or reply) the Jersey Courts have to strike a balance which is primarily between the parties to the instant case.  The burden on the applicant is a heavy one to show, for example, (1) why the matters now sought to be pleaded were not pleaded before, (2) what is the strength of the new case, (3) why an adjournment should be granted, if one is necessary, (4) how any adverse effects on the other party including the effects of any adjournment, any additional discovery, witness statements or experts reports, or other preparation for trial can be remedied, and (5) why the balance of justice should come down in favour of the party seeking to change its case at a late stage of the proceedings."

10.      To be fair to Advocate Blakeley he was given very short notice of this application and was only able to address me briefly because of limited Court time.  If I had been minded to consider granting the application then I would have allowed him to make further submissions.  However I am not minded to grant the application.  I am not dealing with an amendment to the pleadings but to the defendant seeking to join in another party at this very late stage.  If the defendant felt the necessity to join in Hanau for an indemnity he should have done so well before now, and because of the clear connection between the defendant and Hanau, I have my doubts as to whether an indemnity is really needed; If it is, then he can pursue it in separate proceedings.  As to whether Hanau is the correct defendant i.e. the real party with whom the plaintiff transacted, that is a risk which the plaintiff is content to take.

11.      In my view in the context of this case and its procedural history, the balance of justice comes down in favour of the plaintiff in this matter and the application to join Hanau as a third party is refused. 

12.      In relation to the first application i.e. that relating to the adducing of expert evidence, costs will be in the cause.  However, in relation to the second application I do see this as being an attempt by the defendant to bring in a new party to these proceedings very late in the day and in respect of that application, which has failed, I grant the plaintiff his costs on the standard basis.

Authorities

Royal Court Rules 2004.

Brown-v-Barclays Bank 2001/241.