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England and Wales High Court (Chancery Division) Decisions |
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You are here: BAILII >> Databases >> England and Wales High Court (Chancery Division) Decisions >> Fresh 'n' Clean (Wales) Ltd v Miah & Ors [2006] EWHC 903 (Ch) (29 March 2006) URL: https://www.bailii.org/ew/cases/EWHC/Ch/2006/903.html Cite as: [2006] EWHC 903 (Ch) |
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CHANCERY DIVISION
Strand, London, WC2A 2LL |
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B e f o r e :
(Sitting as a deputy High Court Judge of the Chancery Division)
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FRESH 'N' CLEAN (WALES) LIMITED (In Liquidation) |
Claimant |
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- and – |
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(1) HELIM MIAH (2) HILGATE CORPORATION LIMITED (3) JANAIL SINGH (4) TRADEMASTER LIMITED (5) GERMAN GIOVANNI DE LA TORRE |
Defendants |
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Hearing dates: 19th to 23rd and 29th March 2006
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Crown Copyright ©
Introduction
I should add here that the particulars of claim include other claims which the Company no longer pursues against Hillgate and Mr. Singh.
Mr. Singh and Hillgate
The Company and Hillgate
Mr. Miah
The law
The evidence
32. Mr. Singh's and Mr. Baines' recollections of their conversations at meetings on 14th and 28th September 2004 and 26th November 2004 differ somewhat, although, in the main, more as a matter of timing and nuance than of substance. Mr. Baines made contemporaneous notes which he later incorporated in a report. This then formed the basis for his witness statement. I accept but I do not find in the least surprising that Mr. Baines might have misinterpreted some of Mr. Singh's remarks to him, and, equally, I accept that Mr. Singh might have misinterpreted certain of the remarks which Mr. Baines made to him. I wholly reject, however, the idea that he had attempted to mislead Mr. Singh into believing Hillgate could safely trade just because third party payments were not illegal. He accepts that Mr. Baines told him that Customs 'did not like' them, and he was well aware of the reason. This was not only because, as I find, Mr. Baines informed him they were one of the hallmarks of MTIC VAT fraud but also because, as is as plain as a pike staff, Mr. Baines told him such payments must cease in a letter to him dated 29th November 2004, delivered by Mr. Baines by hand following a meeting between them on 26th November 2004. The letter could hardly have been clearer.
The emphasis, I should add, was incorporated by Mr. Baines in the original.
36. I should mention one final matter which it has been argued demonstrates Mr. Singh's truthfulness. This is the fact that when asked by Mr. Baines on 26th November 2004 to forward to him copies of all documentation generated by the transactions entered into by Hillgate, Mr. Singh duly did so by faxing the same to Customs at Redhill on various dates beginning on 5th December 2004. Documents faxed in this way included not only duplicates of documents which Mr. Singh had already provided to Mr. Baines during the course of his visits to 40 Yardley Wood Road but also documents in respect of transactions closed between 26th November 2004 and 5th December 2004. The fact is, however, that Mr. Singh had no choice in the matter. He had failed to tell Mr. Baines that Hillgate had commenced trading and he knew perfectly well that if he did not comply he would unquestionably fuel any suspicion in Mr. Baines' mind that Hillgates' business was not a proper one. I should add that this assertion underpinned a submission made by counsel for Mr. Singh and Hillgate to the effect that Mr. Singh's conduct in his dealings with Customs revealed an honest mind. The conduct included that Mr. Singh had vouchsafed to Mr. Baines he had too much to lose to risk becoming involved in MTIC VAT fraud, e.g., his matrimonial home worth in the region of £500,000, that he had sought 'guidance' and a straight answer to a question he said he had put to Mr. Baines whether third party payments were illegal, that Mr. Baines had told him that they were not, or, at any rate, that Customs did not like them (according to Mr. Baines, he told Mr. Singh on 26th November 2004 that he should cease making them), that Mr. Singh was therefore entitled to infer that Hillgate could properly continue trading, complying with, and passing on, third party payment instructions. The answer to this submission is that, in my judgment, acceding to it would necessitate inferring that Mr. Singh is naïve to a degree which is wholly unsupported by the evidence. Far from being unintelligent, or uncanny in business, Mr. Singh appeared to me to be intelligent and shrewd, a risk-taker who, in his dealings with Customs, recognised that refusal, or even evident unwillingness, to co-operate with Customs, could easily snuff out a highly profitable business opportunity which was already bearing fruit - lots of it. He considered the risk worth taking, the paperwork was in place to satisfy Customs' basic requirements and third party payments were not, per se, illegal.
Conclusion
37. In the circumstances, I find that Mr. Singh's mental state was dishonest and, accordingly, that he, and through him, Hillgate dishonestly assisted Mr. Miah's breaches of duty to the Company. Judgment will therefore be entered against Mr. Miah, Hillgate and Mr. Singh.
Addendum
(1) Ordered that judgment be entered for a sum or money equal to £11, 603,354.60 plus interest at the rate of 5.6% from 26th January 2005 to the date of the order and otherwise as provided in a draft order agreed by counsel for the Company, Hillgate and Mr. Singh.
(2) On application being made for permission to appeal, permission refused for the reasons set out in the form annexed.