MASTER SHUMAN :
- This is the hearing of separate applications made by each of the defendants. By an application notice dated 14 December 2017 the second defendant seeks an order (a) for summary judgment pursuant to CPR 24.2 (b) strike out of the claim pursuant to CPR 3.4 (2) (a) or (b). The application is supported by a witness statement of Ruth Greening, solicitor, at the defendants' solicitors, CMS Cameron McKenna Nabarro Olswang LLP (CMS) dated 13 December 2017. By application notice dated 8 February 2018 the first defendant seeks an order in the same terms. The application is supported by the second witness statement of Ruth Greening dated 8 February 2018.
- The claimant alleges that the first defendant received the sum of CHF 3 million ("the Sum") in the form of a SWIFT transfer from Bank Mirabaud in Montreal on 13 March 2008. The Sum was paid into the account of Centurion Management Services Ltd ("centurion"), in accordance with the SWIFT message, but the claimant says that ultimately it should have been paid to him. The Sum was paid away by centurion and never received by the claimant. The claimant brings a claim for restitution to "put the position back where it should have been and would have been if no transaction had been undertaken prior to 13 March 2008". The amount claimed on the claim form, which was issued on 13 July 2017, is CHF 3 million which is said to have a value in sterling of £2,401,904.53. The second defendant appears to have been included in the claim on the basis that they are the holding company of the first defendant.
- Each defendant has filed a defence disputing the claim which in broad terms alleges that the claim is pleaded without any proper allegations relating to the underlying facts such that the pleadings obstruct the just disposal of the claim, the claim is out of time and the claim in any event is bad in law and on the facts. The claimant has replied to each of the defences.
- On 16 April 2018 the claimant sent a draft amended particulars of claim to CMS. The defendants do not consent to the claimant amending his claim and to date no application has been made by the claimant seeking permission of the court pursuant to CPR 17.1.
THE FACTUAL MATRIX
- The first defendant is a bank registered in Jersey. The claimant has never been a customer of the first defendant. The second defendant is the holding company of the first defendant but it is not itself a bank.
- On or about 13 March 2008 Pierre Albert Schenk instructed Mirabaud Canada Inc to transmit the Sum to the first defendant to be paid into account GB24RBOS16102850084995. The defendants' evidence, which is undisputed, is that this is the international bank account equating to the bank account held with the first defendant numbered 1028–50084995 and is the account of centurion ("the centurion account").
- The claimant relies on a SWIFT message ("the SWIFT message"). The first defendant is a member of SWIFT but the second defendant is not.
- A SWIFT message has various fields that are completed by the remitting bank or its customer. These are mandated fields, required so that the receiving bank can allocate the funds to the appropriate customer.
- The relevant fields of the SWIFT message are as follows:
|Type of message
||which is a message to put money into an account
||MIRICAMMXXX MIRABAUD CANADA INC./MONTREAL
||which is the sending bank
|32A Val Dte/Curr/Interbank Settle Amt
Amount 3,000,000 00
|50K Ordering Customer
||/90011124 1 PIERRE ALBERT SCHENK
|57A Account with Institution
||RBOSJESXXXX ROYAL BANK OF SCOTLAND
||Institution at which account is to be credited
|59 Beneficiary Customer
||/GB24RBOS16102850084995 CENTURION MANAGEMENT SERVICES LTD CLIENT ACCOUNT
||Tells the institution which bank account to credit
|70 Remittance Information
||REF. FOR THE BENEFIT OF GLOBAL PIK
PRIVATE EQUITY PCC FOR FURTHER CREDIT TO A.N.A. HOLDINGS
|This is a reference for the beneficiary not a message to the institution.
- ANA Holdings appears to be the claimant's trading name, although there is no suggestion that the first defendant was aware of this at the time of the SWIFT message. Neither ANA Holdings nor the claimant has an account with the first defendant.
- The claimant pleads that the monies were then paid away by centurion and by implication that he did not receive them.
- The defendants' evidence is that the first contact from the claimant, as far as they are aware, is a letter dated 2 February 2015 addressed to the first defendant attaching a copy of the SWIFT message and asking questions about the transfer. This is not disputed by the claimant. The first defendant replied on 12 February 2015 stating that they could not assist. They reminded the claimant that they owe a duty of confidentiality to their customers and cannot disclose information to third parties unless compelled to do so by court order. Nothing further was heard until the claimant wrote to the defendants by letter dated 8 May 2017 when he informed them that he had made an application to the High Court for disclosure of the Account. It does not appear that the application was ever issued.
- However this is not the entire story. The defendants only subsequently discovered that the claimant had been a defendant in a claim brought by Jean-Pierre Schenk ("Mr Schenk") under claim number HQ14X01272. The claimant was the fourth defendant and ANA Holdings the sixth defendant. Judgment was given by Green J on 9 February 2017. This judgment adds to the factual matrix that had not been disclosed by the claimant or readily discoverable by the defendants.
- Paragraph 1 of the judgment records that Mr Schenk was induced by six named defendants ("the Schenk defendants"), including the claimant and ANA Holdings, to enter into an agreement whereby he was to invest in existing medium term notes with a very short invest-by date and a very high return. Mr Schenk transferred the first tranche, CHF 3 million into the control of the Schenk defendants with a view to the bonds being acquired. Mr Schenk used his father's account to facilitate this but it was his money. No such bonds were ever acquired. Almost immediately the bulk of the money was either paid to the Schenk defendants or dissipated through a series of corporate vehicles ultimately owned by various of the Schenk defendants. This is the Sum that the claimant seeks to recover from the defendants in these proceedings.
- Mr Schenk sought to recover his funds. A meeting took place on 2 June 2008 when an agreement was reached and during which a series of further false representations were made. Mr Cook, the first Schenk defendant, and the claimant attended that meeting on behalf of the Schenk defendants with Mr Schenk's lawyer. Mr Schenk was told that his funds have been invested in the shares of a company, Fluid Leader plc ("Fluid"), which was to be readmitted to the PLUS stock exchange the next day. Fluid was said to be the owner of a patent application which would prove very profitable in the oil and gas sector. It was represented to Mr Schenk that forthwith upon listing, shares in Fluid would be sold and he would receive by way of return a sum representing a substantial profit on the investment. This agreement was set out in writing and made between ANA Holdings and Mr Schenk. In fact no shares had been acquired for the claimant and in any event the Fluid shares were subject to a lock-in agreement which precluded them from being sold for 12 months following trading. Further when Fluid was admitted to listing its performance plummeted and its shares were suspended in 2009. Mr Schenk received no shares in Fluid or any returns on their sale.
- Mr Schenk issued a claim to recover the Sum together with interest against the Schenk defendants on the basis of: (i) conspiracy, (ii) deceit and fraudulent misrepresentation, and (iii) knowing receipt and dishonest assistance ("the Schenk claim"). Judgment was entered in favour of Mr Schenk ("the Shenk judgment").
- In the judgment Green J concluded that the scheme was from the outset,
"a scam and a fraud knowingly perpetrated by the Defendants collectively upon the Claimant.… The Claimant has framed his case in a variety of different ways but they boil down to a claim that the Defendants collectively engaged in a dishonest plan to steal his money in my judgment this core allegation is made out to the requisite standard of proof required in civil fraud cases alleging dishonesty and in relation to the torts in issue. Each defendant is therefore liable."
I note that the claimant had his defence struck out by a master, before trial and that he had appealed this decision. However Green J allowed the claimant to fully participate in the trial, to test the evidence adduced by Mr Schenk before then determining, following the trial, that his appeal was dismissed.
- The claimant did not appeal the Schenk judgment. He submitted to me that he did not understand what he had to do by way of appeal. I note that the claimant represented himself in the trial that was heard over 5 days and indeed he had appealed the decision of the master which was also heard during the trial. No other defendants, other than ANA Holdings which was represented by the claimant, attended trial or were represented. When the claimant sought to argue that he had no warning about an unless order and the consequences of it Green J commented that he could "detect no lack of sophistication in the approaches of the parties".
- As I have stated the defendants rely on two witness statements of Ruth Greening. In response the claimant has filed two witness statements dated 10 April 2018 and 12 April 2018. At the hearing the claimant handed up a third witness statement dated 17 June 2018, which the defendants did not object to. The defendants have also filed two further witness statements from Ruth Greening, her third and fourth, dated 11 April 2018 and 13 June 2018.
- For completeness, in terms of the statements of case, the claimant has made part 18 requests of each defendant, which have been replied to; replies dated 13 December 2017 and 8 February 2018. The defendants have also made a part 18 request that has been replied to by the claimant; reply dated 15 January 2018.
- Pursuant to CPR 24.2 a court may give summary judgment on the whole of a claim or on a particular issue if:
"(a) it considers that—
(i) that claimant has no real prospect of succeeding on the claim or issue; … and
(b) there is no other compelling reason why the case or issue should be disposed of at a trial."
- Both limbs must be satisfied. In the notes to Volume 1 of the White Book 2018 at 24.2.3 it is commented that,
"In order to defeat the application for summary judgment it is sufficient for the respondent to show some "prospect", i.e. some chance of success. That prospect must be "real", i.e. the court will disregard prospects which are false, fanciful or imaginary. The inclusion of the word "real" means that the respondent has to have a case which is better than merely arguable". … The respondent is not required to show that their case will probably succeed at trial. A case may be held to have a "real prospect" of success even if it is improbable. However, in such a case the court is likely to make a conditional order…"
- The hearing of a summary judgment application is not a summary trial. The court will therefore only consider the merits of the respondent's case to the extent that it is necessary to determine whether it has sufficient merit to proceed to trial. The criterion to be applied by the court under CPR 24, unlike a trial, is not one of probability but the absence of reality.
- The evidential burden is on the applicant to establish that there are grounds to believe that the respondent has no real prospect of success and that there is no other reason for a trial. If credible evidence is adduced in support of the application then the respondent becomes subject to an evidential burden of proving some real prospect of success or some other reason for a trial. The standard of proof is not high. As the notes to the White Book 2018 24.2.5 emphasises,
"the Court hearing a Pt 24 application should be wary of trying issues of fact on evidence where the facts are apparently credible and are to be set against the facts being advanced by the other side. Choosing between them is the function of the trial judge, not the judge on an interim application, unless there is some inherent improbability in what is being asserted or some extraneous evidence which would contradict it".
- Pursuant to CPR 3.4(2),
"3.4(2) The court may strike out a statement of case if it appears to the court—
(a) that the statement of case discloses no reasonable grounds for bringing or defending the claim;
(b) that the statement of case is an abuse of the court's process or is otherwise likely to obstruct the just disposal of the proceedings…"
- The notes to the White Book 2018, at 3.4.2 reiterate that a claim should not be struck out unless the court is certain that it is bound to fail. Paragraph 1.4 of Practice Direction 3A gives examples of cases where the court may conclude that particulars of claim disclose no reasonable grounds for bringing the claim: claims which set out no facts indicating what the claim is about; claims which are incoherent and make no sense; and claims which contain a coherent set of facts but those facts even if true, do not disclose any legally recognisable claim against the defendant.
- Where a statement of case is found to be defective the court should consider whether the defect may be cured by amendment and it might allow a party an opportunity to amend. Here the claimant presumably seeks to amend his particulars of claim, albeit without the permission of the defendants or the court, as he has produced a draft.
- Mr Temple submitted that it is not sufficient for the claimant to resist the applications on the basis that he will seek to prove his case at some later date, unless there is good reason to think that such evidence might exist. He referred me to the judgment of HHJ Belcher sitting as a High Court Judge in Rehman v Jones Lang Lasalle  EWHC 1339 (QB) at paragraph 388.
- The application for strike out is also brought under CPR 3.4(2)(b), that the state of the claimant's pleadings will obstruct the just disposal of the claim. Mr Temple refers me to a decision of Teare J in Towler v Wills  EWHC 1209, in which he set out the court's general approach to poor pleadings,
"16. CPR 3.4 gives the Court power to strike out a statement of case which is an abuse of the Court's process or is otherwise likely to obstruct the just disposal of the proceedings. The notes to CPR 3.4state that these grounds include statements of case which are unreasonably vague or incoherent. That is no doubt because such statements of case are an abuse of the Court's process and are likely to obstruct the just disposal of the case. "
18. The purpose of a pleading or statement of case is to inform the other party what the case is that is being brought against him. It is necessary that the other party understands the case which is being brought against him so that he may plead to it in response, disclose those of his documents which are relevant to that case and prepare witness statements which support his defence. If the case which is brought against him is vague or incoherent he will not, or may not, be able to do any of those things. Time and costs will, or may, be wasted if the defendant seeks to respond to a vague and incoherent case. It is also necessary for the Court to understand the case which is brought so that it may fairly and expeditiously decide the case and in a manner which saves unnecessary expense. For these reasons it is necessary that a party's pleaded case is a concise and clear statement of the facts on which he relies; see Spencer v Barclays' Bank 30 October 2009 per Mr. Bompas QC at paragraph 35. The Amended Particulars of Claim are, perhaps, concise but they are not clear or coherent. The transactions which the Defendant is alleged to have conducted in the name of the company without disclosing his conflict of interest and which have caused loss have not been clearly identified. The Further Information could perhaps have cured these defects but it has not done so. The particular transactions cannot be identified with ease. Moreover, additional claims, not foreshadowed or pleaded in the Amended Particulars of Claim, appear to have been added. They have no place in the Further Information since they had not been pleaded in the Amended Particulars of Claim. Further, evidential material has been added in such a way as to make comprehension of the Further Information difficult.
19. It is not fair and just that the Defendant cannot be sure of the case he has to meet. It may well be that, with appropriate legal advice, the Claimant could have pleaded a concise, clear and particularised case against the Defendant but that has not been done. If the Amended Particulars of Claim are not struck out there is a very real risk that unnecessary expense will be incurred by the Defendant in preparing to defend allegations which are not pursued, that he will be impeded in his defence of allegations which are pursued and that the Court will not be sure of the case which it must decide."
- On 13 July 2017 the claimant's claim against the defendants was issued. The particulars of claim rely on field 70 in the SWIFT message as demonstrating that the sum was to be "ring fenced" and that it was evident that the Sum did not belong to centurion. The Claimant asserts that the Sum was held on an "agency" by the first defendant and that this gives rise to a duty of care and fiduciary duties being owed to him. The defendants failed to "secure these funds" in the Account and were in breach of their duty to protect the Sum. The claimant goes on to suggest that this gives rise to a claim for unjust enrichment due to "failed consideration under an illegal arrangement".
- Following the filing of the defendants' defences the claimant filed replies. The claimant's reply to the first defendant's defence, paragraph 5, averred that there was an agreement made within the jurisdiction of England and Wales to remit funds from Mirabaud, Canada. No further details are pleaded. The claimant also asserted, at paragraph 7, that the defendants had dishonestly failed to enquire with centurion as to the identity of ANA Holdings.
- The defendants made a part 18 request dated 13 December 2017 seeking clarification of the particulars of claim. The claimant replied on 15 January 2018. The significant replies are :
1. What relationship, if any, does Mr Schenk have to the claimant?
Reply: the claimant had no relationship with the sender of the funds
2. What was the intended use of the monies transferred? Please provide full details of
Reply: Intended use of the transfer was to use it short-term producing a high reward
2.1. Whether Mr Schenk and/or the claimant had any obligation to pay monies to Global PIK Private Equity PCC?
Reply: In broad terms Mr Schenk intended to rely on the intended recipients ANA Holdings – the ultimate beneficiary of the funds to use on his behalf and produce a high return short-term gain. It follows that as ANA Holdings did not in fact receive the funds as intended by the SWIFT payment further particulars are academic
3. Is it alleged that either Defendant had any relationship with Mr Schenk, Global PIK Private Equity PCC, the Claimant and/or ANA Holdings prior to the SWIFT payment? If it is so alleged, please provide full details of any such relationship.
5. Who does the claimants say had an obligation to 'ring fence' the funds?
6 What does the claimant allege that the defendant should have done upon receipt of the swift transfer?
Reply: The Claimant was the ultimate Beneficiary as such the Defendants had an obligation to check all Fields to comply with AML/KYC Swift field 70 indicated payment was be made to a third Party further credit of ultimate Beneficiary and to recognise the collecting/receiving banker duties of which the Defendants are well aware. …"
- The claimant also asserted in his replies that the first defendant should have carried out identity checks on ANA Holdings and should have returned the funds to Mr Schenk because the claimant or ANA Holdings "did not hold an account with the receiving/collecting bank". He made allegations of dishonesty against the defendants. He said that he would produce upon disclosure information supporting the allegations of dishonesty.
- At the close of pleadings and following the claimant's response to the defendants' part 18 requests the claim remained vague, confusing and opaque. Some light was shed on the factual matrix when the defendants by chance discovered the judgment of Green J in the Schenk claim.
The first defendant's application
- The first defendant has not brought its application on the basis that this claim is an abuse of process amounting to a collateral attack on the Schenk judgment. Indeed I am not in a position to discern how far the claimant is attempting to rerun previous litigation. However Mr Temple makes two relevant points about the significance of the Schenk judgment. Firstly, earlier judgements reveal the contents of documents and the evidence of witnesses; JSC BTA Bank v Ablyazov  EWHC 2908 (Comm) at paragraph 26. Secondly, the court can have regard to matters of primary fact recorded in earlier judgements; Otkritie v Gersamia  EWHC 821.
- Mr Temple submits that an earlier judgment can be referred to where, as in this case, pleadings are opaque on important matters and the judgment helps to clarify the factual matrix against which the claim is being pursued. I agree with this submission.
- Mr Temple refers me in particular to 7 matters of evidence and the judge's findings in the Schenk judgment:
i) Mr Schenk had transferred the Sum on the basis of an agreement with the Schenk defendants that the Sum would be invested in medium-term notes producing returns of 400 to 600%; paragraph 25
ii) Whilst the claimant did not make the initial false representations he was working with those that did; paragraph 28
iii) The claimant was involved in correspondence that concealed an intention to invest the Sum into Fluid shares and not the medium-term notes; paragraphs 40 to 41
iv) The claimant attended the meeting with Mr Schenk's lawyer on 2 June 2008 at which he asserted that the Sum had been invested in Fluid; paragraphs 47 to 50
v) The claimant entered into a contract acknowledging receipt of the Sum and stating that it had been invested into Fluid shares; paragraphs 51 to 52
vi) The claimant falsely claimed that he had nothing to do with the transaction; paragraph 61
vii) Notwithstanding the terms of the compromise agreement the claimant never obtained the Fluid shares for Mr Schenk; paragraph 62 to 63
- The application for summary judgment and/or strike out is brought by the first defendant on 3 bases:
(1) the particulars of claim are so vague that they do not set out any reasonable basis for bringing the claim against the first defendant. They are so deficient that unless amended they would obstruct the just disposal of the proceedings.
(2) the particulars of claim do not set out any reasonable basis of bringing the claim and/or have no real prospect of succeeding. The claim hinges on field 70 in the SWIFT transfer, which the first defendant has no obligation to act on. Further the claimant has failed to set out why he claims to have a beneficial interest in the Sum.
(3) the claim is time-barred, it relates to events that took place in March 2008, over 9 years before the claim was issued. The claimant has not set out any basis for extending or disapplying the limitation periods.
- The claim presently articulated is simply an assertion of liability on the basis of the SWIFT message, specifically field 70. However it is field 59 which tells the institution which bank account to credit. The instruction from Mirabaud Canada Inc was that the Sum was to be paid into the centurion account. The fact that it was paid into this account can be seen in the bank statement exhibited to the claimant's third witness statement and the IBAN for the recipient beneficiary corresponds with the SWIFT message, the centurion account. Field 70 is described as remittance information and the claimant does not plead how, without more, this apparently fixed the first defendant with knowledge that the Sum was due to be paid to ANA Holdings; described by the claimant in his particulars of claim as demonstrating that the funds were to be "ring fenced". I consider it to be significant that the claimant failed to set out the true background to the payment by Mr Schenk of the Sum and that he failed to provide any explanation as to why he says that he had a personal interest in the sum. I accept Mr Temple's submission that the claimant has had a number of opportunities to explain the background and more significantly how he avers that he has an interest in the Sum and yet he has failed to do so. I do not understand how the claimant asserts any interest in the Sum not least when I place it within the factual matrix and given the findings made in the Schenk judgment.
- The claimant submitted to me that the basis of the claim was that he was a de facto trustee or a judgment debtor in relation to the Sum. I asked the claimant to take me to both his pleaded case and the evidence in support of his position. He simply referred me back to the SWIFT message and field 70 asserting that it created a common intention constructive trust. However it was Mr Schenk's funds, transferred as a result of fraud, to centurion's account. Green J having had the benefit of hearing the claimant give evidence and being taken to a raft of documentation found that there was a close business relationship between the claimant and the first and fifth Schenk defendants under which they sought investment opportunities together. At paragraph 30 he concluded that there was a powerful inference that could be drawn that all of the Schenk defendants were aware from the outset of the plan to induce Mr Schenk to invest in the bonds. He refers to email exchanges which show that the details of the account into which the Sum was to be transferred were given by the claimant to Mr Couture and then onwards to Mr Schenk via Mr Stramandino. The Schenk defendants have been ordered to pay the Sum together with interest to Mr Schenk. The claimant was a party to this fraud.
- To compound matters for the claimant Green J referred to an email of 19 March 2008 indicating that the claimant was to receive £100,000 and a Mr Loughrey £50,000 from the Sum. The judge said at paragraph 38 that there was a dispute as to the actual sum of money that the claimant received, some documents suggested that he might have received as much as £250,000. "There is no doubt however that Mr Bawany was paid commission and in oral evidence he accepted as much."
- Mr Temple, doing the best that he can, extrapolates the case that the first defendant has to meet and suggest that the potential claims are in negligence, unjust enrichment, breach of trust and dishonest assistance.
- Negligence. The claimant's case is that the first defendant owed a duty of care to him not to pay the Sum into the centurion account, even though this was the recipient inputted in the SWIFT message, or in allowing the payments out made by centurion. In Abou-Rahmah v Abacha  EWHC 2662 (QB) Treacy J concluded there was no duty of care owed even when the name of the immediate payee had been mis-spelt . At paragraphs 67to 68 the judge said,
"67 I remind myself that this case is concerned purely with economic loss and that the common law is reluctant to impose a duty of care save in special circumstances. I have also had regard to the threefold test of foreseeability, proximity and reasonableness enunciated in Caparo Industries PLC v Dickman (1990) AC 605 in determining the existence of a duty of care.
68 The following matters seem relevant in this context:
i) The Claimants were not the Defendant's customers.
ii) No special responsibility had been undertaken by the Defendant to the Claimants.
iii) Until the monies were received by the Defendant there had been no contact from the Claimants — the monies were simply paid by the Claimants to the Defendant's HSBC bank account.
iv) The Defendant received the monies as the agent of its customer to whom it owed duties arising from their contractual relationship.
v) A bank has a huge number of potential payers who can remit monies without significant control by the bank.
vi) The imposition of a duty of care in relation to such persons (in the absence of special circumstances) would in practice impose very heavy burdens on banks and significantly hamper their efficiency."
- Field 59 was correctly completed; indeed it was the claimant that provided the account details into which the Sum was to be paid. The claimant was not the first defendant's customer, centurion was. As far as the first defendant was concerned centurion was entitled to receive the Sum, per the SWIFT message, and to make payments as it chose to out of the centurion account. The Sum was paid by Mr Schenk. If the Sum was ultimately to be paid to the claimant, which on the Schenk judgment is not the case, there was nothing on the SWIFT message that might give rise to a special relationship between the claimant and the first defendant. Further taken at its highest the claimant could assert he was investing the Sum on behalf of Mr Schenk; although given the claimant's role in the fraud and that the Schenk defendants have been ordered to pay the sum to Mr Schenk that position is not open to him. There is nothing in the pleading which gives a foundation to the assertion by the claimant that he was the beneficial owner of the Sum. Insofar as the claimant alleges that the first defendant owed a duty of care to him in tort I accept Mr Temple's submissions, the claim is bound to fail.
- Unjust enrichment. This claim is also bound to fail. The sum was paid by Mr Schenk not the claimant and he cannot therefore show that the enrichment was at the expense of the claimant; Investment Trust v HMRC  UKSC 29, particularly paragraphs 51 to 52 and 59. The first defendant was not actually enriched. It received the Sum as agent for centurion and the Sum was withdrawn by centurion from the centurion account before the first defendant had notice of the purported restitutionary claim. Ministerial receipt is a different defence to change of position; it is available only where a collecting bank has received funds as agent for the customer and has paid away the funds to the customer. Where the defence of ministerial receipt is available monies paid to the agent can only be recovered from the principal, that is, centurion. In common law the agent is merely a conduit for the money. The claimant has not shown that the first defendant was on notice before the monies were paid out of the centurion account.
- Breach of Trust and fiduciary duties. Mr Temple referred me to the judgment of Millet LJ in Bristol and West Building Society v Mothew  CH1 at page 18. The claimant would need to establish a relationship of trust and confidence between the first defendant and the claimant. Again field 59 in the SWIFT message required the sum to be credited to centurion's account. If the first defendant had been impressed with a trust or owed fiduciary duties that would have been to Mr Schenk not the claimant. However this does not arise here because the Sum was correctly credited to the centurion account.
- Dishonest assistance. The reference to wrongful assistance in the particulars of claim might be read as a reference to dishonest assistance of breach of fiduciary duty. Mr Temple summarised the 4 elements to a claim for dishonest assistance, principally by reference to Lewin on Trusts, 19th edition, paragraphs 39-071,40-024 and 40-014. (1) The existence of a trust or a fiduciary duty. (2) A primary wrong by trustee or fiduciary, though the breach need not itself be dishonest. (3) Conduct by the defendant that assists the primary wrong. (4) Dishonesty on the part of the defendant. There is an additional requirement on the claimant to demonstrate that he has the necessary locus standi, he must be a beneficiary of the trust or fiduciary duty.
- The claimant has failed to plead the case setting out the alleged primary wrong by centurion. In any event he would have to plead a conspiracy that Green J found that he was a party to. There is no evidence before me that suggests that the first defendant had any knowledge of impropriety by centurion. The claimant should have pleaded particulars of fraud and he has had ample time to do so. As Mr Temple submits it is not sufficient for the claimant to resist the applications on the basis that he will seek to prove his case at some later date. There is nothing before me to suggest that this evidence exists other than the bare word of the claimant. He says that he will produce the evidence on disclosure but that is not good enough. If it existed he would have adduced it to support his position that the defendants' applications should be dismissed. As I have already indicated the claimant was not the beneficiary of the trust or owed fiduciary duties. If centurion owed fiduciary duties it was to Mr Schenk not to the claimant. Insofar as it might be suggested by the claimant that there was a chain of accountability that would not assist the claimant because it would be both centurion and the claimant who at all times have been accountable to Mr Schenk. The claim is bound to fail for dishonest assistance.
- Instead of the claimant taking the opportunity to clarify his case and to explain its legal basis, in his third witness statement he seeks to attack the defendants as being dishonest. This is a point that was made in his reply as well. The allegations are unsupported by any particulars. He goes on to suggest at paragraph 9 of his third witness statement that the conduct of the defendants can only be described as "wilful blindness" and can only be "attributed to stealing". This appears to be based on the fact that the centurion account until the Sum was paid into it, was overdrawn. This is not pleaded and in any event I fail to understand how this fact is relevant when field 59 is clear, it inputted who the recipient was to be and the Sum was correctly paid into the centurion account.
The draft amended particulars of claim
- I have also considered the claimant's draft amended particulars of claim although I bear in mind that the defendants do not consent to this amendment and the claimant has made no application for permission.
- The claimant has still failed to set out the facts of the underlying transaction that gave rise to Mr Schenk transferring the Sum. How then can he establish that he is the purported beneficial owner of the Sum? Whilst he now admits that he would have been bound to hold the monies for Mr Schenk, had they been paid to him, he still relies on field 70 in the SWIFT message as putting the first defendant on enquiry so that the transfer of the sum should have been refused or returned. Significantly he does not plead that Mr Schenk had an obligation to transfer the Sum to the claimant. There is some force in Mr Temple's observation that "his real complaint is that he became liable to Mr Schenk for his part in the fraudulent conspiracy found by Green J".
- The claimant now relies on the SWIFT message as giving rise to a resulting or Quistclose trust. He alleges that the swift message was the medium bringing about those trusts because it was for a particular purpose and stated to be for the exclusive use of the claimant. He fails to plead what that purpose was.
- The claimant also now purports to plead particulars of knowing receipt and dishonest assistance. In fact he only then sets out dishonest assistance. He relies on the "likely insolvency of centurion" but provides no evidence to support this and indeed fails to explain its relevance.
- There is nothing within the draft amended particulars of claim that helps the claimant to show some prospect or chance of success.
- As to limitation the defendants have specifically pleaded this defence. The claimant has not addressed this. Extrapolating the claimant's claim, whether it is brought in tort, unjust enrichment or based on constructive trusts or dishonest assistance, the limitation period is 6 years. The claimant has not asserted any reliance on section 14A or section 32 of the Limitation Act 1980; whilst the first defendant pleads that Jersey law applies to the claim the claimant's position is that English law prevails. I note in passing that it was the claimant that provided the centurion account details that were then inputted into the SWIFT transfer and he was present at the meeting on 2 June 2008 when an agreement was entered into between Mr Schenk and ANA Holdings in relation to the use of the Sum. The claim is therefore time-barred.
- In conclusion, I am satisfied that the first defendant has established that there are grounds to believe that the claimant has no real prospect of success and there is no other reason for a trial. The claimant then became subject to an evidential burden of proving some real prospect of success or some other reason for a trial, the standard of proof is not high. However the claimant has failed to discharge this burden. His causes of action are defective. The claimant has sought to amend his particulars of claim albeit without permission, but the revisions to the claims that he seeks to put before the court remain fundamentally defective. Furthermore he has failed to address the limitation defence that the first defendant has pleaded. Further this is all set in the now known factual matrix and the claimant's role in the fraud perpetrated on Mr Schenk. I also accept Mr Temple's submissions that the pleadings are sufficiently incoherent or vague and plead allegations of dishonesty without any particulars or evidence in support and that they are likely to obstruct the just disposal of the proceedings. I allow the first defendant's application both for summary judgment and in the alternative strike out of the claim under (a) that the statement of case discloses no reasonable grounds for bringing the claim and (b) that the statement of case is likely to obstruct the just disposal of the proceedings.
The second defendant's application
- The second claimant puts its case on 3 bases: (1) It is a separate legal entity from the first defendant and there is no basis in fact or in law for holding the second defendant liable for any purported wrongdoing of the first defendant. (2) The claim is time-barred in any event. (3) The pleading against it is so vague that they are deficient and would prevent a fair disposal of the claim.
- The points that I have made in relation to the defective causes of action against the first defendant equally apply against the second defendant. The claimant also has the additional problem that the second defendant is a holding company. It is not a bank, it does not provide banking services and is not a regulated entity. The claimant has sought to support his case that the second defendant is a relevant party by setting out his understanding of the RBS group structure and referring to the fact that the RBS group and RBS group members are parties to legal proceedings, investigations and regulatory matters in the Netherlands, the United Kingdom, the United States of America and other jurisdictions. He sets out at paragraphs 34 to 47 of his skeleton argument a summary from cases to support his assertion that the second defendant is a proper party to the proceedings, being the parent company of the first defendant. I do not see how this takes the claimant any further forward given the factual matrix in this case.
- Mr Temple makes the following submissions, which I accept:
i) The claimant asserts a claim for restitution for wrongdoing but the second defendant did nothing at all;
ii) The claimant asserts that there was "a failure by the second defendant to oversee the KYC procedure of the offshore banking arm", the first defendant. He sets out no basis in common law or in statute for a duty to be imposed on the second defendant to oversee an overseas subsidiary.
iii) The claimant asserts that the second defendant "would have an input with processes followed in that regard to its subsidiaries". This is wrong. There is no basis for asserting that the holding company was involved in the processes of its subsidiary, still less that even if there was such involvement it would give rise to a duty of care owed to the claimant.
iv) The claimant asserts that he is entitled to pierce the corporate veil and alleges that the business of the second defendant is no different from that of the first defendant. This argument is bound to fail given the separate legal personalities of the defendants and the very limited circumstances in which the corporate veil may be pierced. Reference was made to Prest v Petrodel  UKSC 34, paragraphs 16 to 35.
v) In his part 18 response the claimant suggested that he would rely upon "assignment of liability and contributory negligence and the sometime described doctrine of the last clear chance". There has been no assignment of liability and contributory negligence is inapplicable. In the absence of any elucidation by the claimant I do not know to what he is referring.
- For the reasons that I have set out above the claim is in any event time-barred. It relates to events in 2008 and no case has been advanced by the claimant to deal with this issue.
- Further the same points that I have made about the way in which the claim has been pleaded also apply to the claim against the second defendant.
- I therefore allow the second defendant's application both for summary judgment and in the alternative strike out of the claim under (a) that the statement of case discloses no reasonable grounds for bringing the claim and (b) that the statement of case is likely to obstruct the just disposal of the proceedings.