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You are here: BAILII >> Databases >> England and Wales High Court (King's Bench Division) Decisions >> Craft Development SCI v Actis LLP & Ors (Rev1) [2025] EWHC 1355 (KB) (04 June 2025) URL: https://www.bailii.org/ew/cases/EWHC/KB/2025/1355.html Cite as: [2025] EWHC 1355 (KB) |
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2025] EWHC 1355 ( KB) | ||
KING'S BENCH DIVISION
Strand, London, WC2A 2LL |
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2025 |
B e f o r e :
____________________
| CRAFT DEVELOPMENT SCI (suing by its provisional administrator Mr Ngoua Elembe Hiob, pursuant to an appointment by the High Court of Douala, Cameroon, Judgment 200/CIV of 8 March 2021) |
Claimant |
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| - and – |
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| (1) ACTIS LLP (a firm) (2) ACTIS AFRICA REAL ESTATE FUND 3 aka Actis Africa Real Estate 3 LP (a firm) (3) ACTIS AFRICA REAL ESTATE 3A LP aka Actis Africa Real Estate Fund 3 (a firm) (4) ACTIS AFRICA REAL ESTATE 3 CO-INVESTMENT SCHEME LP aka Actis Africa Real Estate Fund 3 (a firm) (5) ACTIS AFRICA REAL ESTATE 3C LP aka Actis Africa Real Estate Fund 3 (a firm) (6) ACTIS GP LLP (a firm) |
Defendants |
____________________
Ms Zoe O'Sullivan KC, Mr Charles Holroyd (instructed by Charles Russell Speechlys LLP) for the Defendants
Hearing dates: 13 May
2025
____________________
Crown Copyright ©
2025
by circulation to the parties or their representatives by e-mail and by release to the National Archives.MRS JUSTICE STACEY:
EWHC
484 (
KB)
at [3]-[9]). The claimant ("Craft") is a Cameroonian company with two shareholders: a majority shareholder (Mr Mathurin Jidouc Kamdem ("Mr Kamdem") owner of either 51% or 75% of its shares (the amount is in dispute between the parties) and a minority shareholder, Mr Valère Tchumtchoua Tohouo ("Mr Tchumtchoua")[1] who holds either a 49% or 25% shareholding, depending on whose evidence is preferred.
Litigation history and chronology
2025
and adjourned part-heard for lack of time to 24 February
2025
when directions for trial were made and a trial window from May to July 2026 was identified. Disclosure was ordered to take place by 11 April
2025.
It was initially hoped that the security for costs application could be dealt with on 24 February
2025
but time did not permit and it was adjourned, firstly to 17 March
2025
and then to 13 May
2025.
Issues in the application
2025
respectively), solicitor for Actis with care and conduct of the litigation under the supervision of a partner at Charles Russell Speechlys LLP on behalf of Actis. For Craft the third, the supplemental, the fifth, seventh and eighth statements of its solicitor, Dr Mirande Nasah (dated 3, 10, 14, 15 March and 22 April
2025
respectively) and exhibits were before the court together with the first, second and third statements of Mr Tchumtchoua (dated 12, 16 and March and 22 April
2025)
and exhibits including bank statements, and some inter partes correspondence.
2025,
that more work than anticipated had been done and future costs were also more than had previously been expected. In their costs schedule as at 28 February
2025,
total incurred costs from August 2020 to 28 February
2025
(excluding the costs incurred in relation to the strike out application) were £1,301,393 (exclusive of VAT) and estimated future costs up to expert evidence for trial are now a further £1,218,080.35, making a total of a little over £2.5million.
Stifling
EWHC
1343 (Ch) 12) the court is required to scrutinise as much as it is told with a critical eye and to note unexplained gaps in the information that a claimant volunteers or in the documentary support for it. That includes being prepared to draw adverse inferences from any lacunae Al-Kornoky [27]
The evidence on stifling
2025
Mr Tchumtchoua records the sad deterioration of the family finances and the enforcement action taken against him by creditors. He has managed to reduce his indebtedness but £72,000 is still owing and enforcement procedures are still hanging over him. He sets out the details of the various bank accounts – both personal and in the name of his engineering company, Cross Consult. Only two bank accounts are now active- a personal account with Afriland First Bank which received gross income of £77,000 in 2024 from his engineering business and the income from engineering was verified by his accountant whom he had used to prepare his tax return. He uses the Cross Consult business account for his daily transactions and he confirmed its annual income stated in his first witness statement.
2025
Mr Tchumtchoua states that he is making this new declaration to complement his previous ones and to give additional information about his current financial situation. He exhibits his tax return for 2024 and a formal notice before legal proceedings of November 2024 that he found in his documents for a mortgage loan taken out by SCI Lomathare for £825,050. He explains that in Cameroon, where the banking system is less sophisticated than in England, cash payments are the norm and it is routine for people to use third parties such as friends and relations to bring cash into the UK because of the difficulties in transferring monies abroad, so that not all transactions appear in detail on the bank statements. But whether in cash or at the bank, he now has very little money and cannot afford the security sought by Actis.
2025
– 16 April
2025
which appeared to be a combination of cash withdrawals from the bank and ATM withdrawals. He also noted that cash withdrawals of somewhere in the region of £70-80,000 (after conversion from Central African CFA Franc (per the below correction)) appear to have been made from the SCI Lomathare account at Afriland First Bank since 22 July 2024, which was the date Actis informed Craft of its intention to make an application for security for costs.
Stifling conclusions
Delay
2025.
Dr Nasah's supplementary witness statement of 10 March
2025
states that since it is now three years into the litigation and the delay in Actis making their application for security for costs has now made getting insurance cover unaffordable and unobtainable in spite of her efforts with many litigation funders.
Merits of the claim
EWHC
1867 (comm) [42]).
2025,
prepared in advance of the hearing on 17 March which was subsequently adjourned, their position was that the Court should not have regard to the merits of either the claim or the defence in an application of this nature. It was only upon receipt of Ms O'Sullivan KC's written submissions served two working days before the hearing that Actis now rely on what are said to be inherent fatal weaknesses in Craft's case in support of the application. Of course she is not bound by the submissions of previous counsel, but it is telling that it is only at this stage that the point has been thought worth taking.
EWHC
2709 (Ch) considered that the test for the exercise of the Court's power to strike out a statement of case under CPR 3.4(2)(a) and CPR 24 were both a higher threshold than the merits test in a security for costs application of "highly likely to succeed", but that there was "a high degree of overlap" [35]. I also remind myself that the authorities are clear that an application for security for costs is not intended as a weapon to obtain a speedy summary judgment without a trial or by the back door (see Prince Radu of Hohenzollern v Houston [2006] EWCA Civ 1575 at [18]) and see also Bailey v GlaxoSmithKline UK Ltd (2017)
EWHC
3195 Foskett J at [75]).
Actis' alternative remedies
EWHC
1328(TCC).
Conclusion
Amount of security to be provided
EWHC
3332 (Comm); [2020] Costs LR 1815.
"(i)The appropriate quantum is a matter for the court's discretion, the overall question being what is just in all the circumstances of the case. In approaching the exercise, the court will not attempt to conduct an exercise similar to a detailed assessment, but will instead approach the evidence as to the amount of costs which will be incurred on a robust basis and applying a broad brush (see also Excalibur Ventures v Texas Keystone [2012]EWHC
975 (QB) § 15)."
(ii)In some cases, the court may apply an overall percentage discount to a schedule of costs having regard to (a) the uncertainties of litigation, including the possibility of early settlement and (b) the fact that the costs estimate prepared for the application may well include some detailed items which the claimant could later successfully challenge on a detailed assessment between litigants. There is no hard and fast rule as to the percentage discount to apply. Each case has to be decided upon its own circumstances and it is not always appropriate to make any discount.
(iii)In deciding the amount of security to award, the court may take into account the 'balance of prejudice' as it is sometimes called: a comparison between the harm the applicant would suffer if too little security is given and the harm the claimant would suffer if the amount secured is too high. The balance usually favours the applicant: an under-secured applicant will be unable to recover the balance of the costs which is unsecured whereas, if the applicant is not subsequently awarded costs, or if too much security is given, the claimant may suffer only the cost of having to put up security, or the excess amount of security, as the case may be (see also Excalibur § 18) …
(v)In determining the amount of security, the court must take into account the amount that the respondent is likely to be able to raise. The court should not normally make continuation of their claim dependent upon a condition which it is impossible for them to fulfil."
EWHC
1432 (Ch) at [22] – [34] is useful.
2025
sealed on 22 May
2025. I assess this to be an amount that will not make compliance impossible, but it will be a very considerable stretch for Craft, which is justified given the extent of Actis' exposure and costs risks. I find that it is the most that can be ordered without making compliance by Craft impossible. In arriving at the figure of £300,000 I have factored in that Craft's costs of defending the strike out application decided by Morris J are yet to be subject to a detailed assessment, which was ordered to be undertaken at the end of the trial.
Postscript
Note 1 Although Mr Tchumtchoua is referred to as Mr Valère in the pleadings and the earlier judgment, it is understood that this is his first name and that the correct form of address is Mr Tchumtchoua which has been adopted in this judgment. [Back] Note 2 There is a dispute between the parties as to whether Mr Kamdem was the claimant in all of the Cameroonian proceedings, or if Craft was validly struck off the Cameroonian register of companies and thus required litigation by Mr Tchumtchoua to reinstate, but nothing turns on it. The point is that Craft was reinstated and Mr Hiob as the provisional administrator could and has brought the litigation against Actis. [Back]