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You are here: BAILII >> Databases >> England and Wales High Court (Chancery Division) Decisions >> Toorani & Ors v Toorani & Ors [2020] EWHC 3477 (Ch) (23 December 2020) URL: https://www.bailii.org/ew/cases/EWHC/Ch/2020/3477.html Cite as: [2020] EWHC 3477 (Ch) |
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BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
BUSINESS LIST (ChD)
B e f o r e :
(sitting as a Deputy High Court Judge)
____________________
(1) SAMEERA ABDUL RASOOL TOORANI (2) KHAIRIYAH ABDUL RASOOL TOORANI (3) ROUHANGIZ ABDUL RASOOL TOORANI (4) ZAINAB ABDUL RASOOL TOORANI (5) MARYAM ABDUL RASOOL TOORANI |
Claimants |
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- and - |
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(1) THE ESTATE OF BEHROOZ ABDUL RASOOL TOORANI (Represented by Badriya Abdul Rasool Toorani) (2) BADRIYA ABDUL RASOOL TOORANI (3) RABAB ABDUL RASOOL TOORANI (4) MARKH ABDUL RASOOL TOORANI (5) SADUKH ABDUL RASOOL TOORANI |
Defendants |
____________________
Richard Samuel (instructed by Trowers & Hamlins LLP) for the Claimants
W. H. Henderson (instructed by Charles Russell Speechlys LLP) for the First to Fourth Defendants
Hearing date: 2, 3 July, 23 December 2020
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Crown Copyright ©
James Pickering QC (sitting as a Deputy High Court Judge):
PART I: INTRODUCTION
PART II: THE BACKGROUND - THE UNDERLYING DISPUTE
PART III: THE BACKGROUND – THE PROCEEDINGS
PART IV: THE LAW – AMENDMENTS GENERALLY
PART V: THE LAW – PLEADING DISHONESTY
PART VI: ANALYSIS
PART VII: CONCLUSION
PART II: THE BACKGROUND - THE UNDERLYING DISPUTE
The family
The Company
The 2002 Claim
The disputed transfers
The 2007 Claim and the 2009 Claim
The Deceased's death
The Particulars of Claim
The Defence
The Reply
The application to strike out the Reply
The application for permission to file and serve a Re-Re-Amended Particulars of Claim
The application to amend the application notice
The approach to this hearing
"If the Court can see that an amendment has no real prospect of success, it will not flinch from disallowing the amendment, because a claim with no real prospect of success should not be allowed to proceed. Some analysis and evaluation of the case raised by the amendment objected to, whether it be a question of fact or a matter of law, must, therefore, be attempted, to see if it leads (without an unduly prolonged or difficult enquiry, bearing in mind that the procedure is a summary one) to the conclusion that the amendment has no real prospect of success."
"But if the Court is not persuaded that the amendment has no real prospect of success, the ultimate decision maker should not be encumbered with a preliminary view on the point raised by the amendment, nothing like a probability of success being required for these purposes."
"…The claimant does not have to plead primary facts which are only consistent with dishonesty. The correct test is whether or not, on the basis of the primary facts pleaded, an inference of dishonesty is more likely than one of innocence or negligence. As Lord Millett put it, there must be some fact "which tilts the balance and justifies an inference of dishonesty."
"At the interlocutory stage, when the court is considering whether the plea of fraud is a proper one or whether to strike it out, the court is not concerned with whether the evidence at trial will or will not establish fraud but only with whether facts are pleaded which would justify the plea of fraud. If the plea is justified, then the case must go forward to trial and assessment of whether the evidence justifies the inference is a matter for the trial judge…"
(1) A general objection that the proposed amendments are late in that they could have been included in the original Particulars of Claim.
(2) Some general objections that the proposed amendments are unnecessary.
(3) Some specific objections relating to the proposed amendments as to dishonesty and sham.
General objection that the proposed amendments could have been pleaded in the original Particulars of Claim
General objections that the proposed amendments are unnecessary
Specific objections relating to the proposed amendments as to dishonesty and sham
"…the court is not concerned with whether the evidence at trial will or will not establish fraud but only with whether facts are pleaded which would justify the plea of fraud. If the plea is justified, then the case must go forward to trial."
and further that, when considering whether facts are pleaded which would justify a plea of dishonesty:
"…The claimant does not have to plead primary facts which are only consistent with dishonesty. The correct test is whether or not, on the basis of the primary facts pleaded, an inference of dishonesty is more likely than one of innocence or negligence. As Lord Millett put it, there must be some fact "which tilts the balance and justifies an inference of dishonesty".
(a) Specific objection to the Claimants' secondary case
(b) Further specific objection to the Claimants' secondary case: the role of Nicholas Cawley
"…acts done or documents executed by the parties to the 'sham' which are intended by them to give to third parties or to the court the appearance of creating between the parties legal rights and obligations different from the actual legal rights and obligations (if any) which the parties intend to create…"
"But one thing, I think, is clear in legal principle, morality and the authorities… that for acts or documents to be a 'sham', with whatever legal consequences follow from this, all the parties thereto must have a common intention that the acts or documents are not to create the legal rights and obligations which they give the appearance of creating."
"As agents of RRL, the dishonesty of the Second and Third Defendants is attributable to RRL".
(c) Further specific objection to the Claimants' secondary case: uncertainty as to whether or not the scheme would work
(d) Specific objections to the Claimants' third case
"When dishonesty is in question the fact-finding tribunal must first ascertain (subjectively) the actual state of the individual's knowledge or belief as to the facts. The reasonableness or otherwise of his belief is a matter of evidence (often in practice determinative) going to whether he held the belief, but it is not an additional requirement that his belief must be reasonable; the question is whether it is genuinely held. When once his actual state of mind as to knowledge or belief as to facts is established, the question whether his conduct was honest or dishonest is to be determined by the fact-finder by applying the (objective) standards of ordinary decent people. There is no requirement that the defendant must appreciate that what he has done is, by those standards, dishonest."
(e) A final overarching objection based on an alleged internal consistency
(f) Other specific objections
(1) As for the Claimants' application to amend, I find that the proposed amendments are unobjectionable. I therefore grant permission to the Claimants to file and serve Re-Re-Amended Particulars of Claim in the form attached to their application notice.
(2) As for the Defendants' application to strike out certain paragraphs of the Reply, it seems to me that this was effectively superseded by the Claimants' application to amend. I will therefore simply make no order on that application.
(3) As for the Claimants' application to amend the typographical error in its earlier application notice, no realistic objection was (sensibly) taken to this and so I will grant permission.
JPQC
December 2020
Note 1 In March 2006, the sum was reduced to about £1.6 million but in November 2006 the original judgment sum of about £2.7 million was restored. [Back] Note 2 Under his will, the Deceased’s estate passed to his full sisters (in other words, the Second to Fifth Defendants), with his half-sisters (including the Claimants) receiving nothing. In the circumstances, however, little would appear to turn on this. [Back] Note 3 At the same time, the Claimants issued a claim seeking recognition of their Bahraini judgments in England [Back] Note 4 The Claimants had served an Amended Particulars of Claim in December 2017 and a Re-amended Particulars of Claim in June 2019 [Back] Note 5 And in the absence of special features such as the application to amend being made close to trial or after the expiry of a limitation period [Back] Note 6 See, for example, paragraphs 45 to 47 which, in relation to their original (now primary) claim, the Claimants set out their position in relation to the KPMG advice [Back] Note 7 See, for example, paragraphs 66 to 68 [Back] Note 8 And also the more recent authority of Shalson v Russo [2005] Ch 281 [Back] Note 9 As stated in paragraph 8 (and footnote 1) above, in March 2006 the judgment sum was reduced to about £1.6 million before being restored to about £2.7 million in November 2006. Accordingly, as at the time of the transfers (in September and October 2006), the judgment debt stood at about £1.6 million. [Back]