Practice and Procedure


PUBLISHED January 24, 2003

It was not an abuse of process to bring separate proceedings on similar facts against different defendants who were not privies.Appeal by the first and fourth defendants ('CVB', and his mother, 'EH') from a decision of Lloyd J refusing to strike out claims against them as an abuse of process. The fifth defendant ('WHB') and CVB's brother ('MVB') were directors of the claimant company, Dexter. In 1997 Dexter borrowed ?2m from a bank supposedly to purchase an aircraft engine. Dexter's case was that the purported acquisition of the engine was a fictitious and fraudulent scheme on the part of MVB, CVB and WHB to procure the advance from the bank for their own use. The money borrowed from the bank was paid away on their instructions and not for the benefit of Dexter. Dexter went into receivership in 1998 and in 1999 commenced proceedings against MVB alone. Halfway through the trial of that action MVB went to Spain and abandoned his defence. Judgment was entered against him for £2m plus interest and indemnity costs. After discovering that some of the missing money had been paid to EH, Dexter commenced proceedings against her. Those proceedings were set aside on jurisdiction grounds since EH was domiciled in Spain. Dexter then sued CVB, EH and WHB (among others) making allegations similar to those contained in the action against MVB but also including new allegations relating to the payment of money to EH. CVB and EH applied to strike out the new proceedings as an abuse of process relying on Henderson v Henderson (1843) 3 Hare 100. The judge found that the claimant had valid reasons for not suing CVB and EH in the first action. Applying Johnson v Gore Wood & Co (2001) 2 WLR 72 he held that the mere fact that the later action had been brought was not abusive. It was for the defendants to show that it was abusive and they had failed to do so. The defendants appealed. The issue was whether the action against those parties was an abuse of process.HELD: Lloyd J correctly directed himself in accordance with the guidance given in Johnson v Gore Wood & Co (2001) 2 WLR 72. Subsequent proceedings were not necessarily an abuse of process because their subject matter could have been litigated in earlier proceedings. The judge applied the broad merits-based approach advocated in Johnson (supra). He recognised that successive actions against different defendants who were not privies could be abusive. However, although CVB could have been sued in the first action he could not show that the subsequent proceedings were abusive. CVB was not being vexed a second time or unfairly harassed. The judge was entitled to reject the reasons EH submitted to show that the proceedings against her were abusive. There was no abuse by reason of delay or because Dexter continued to have the benefit of a freezing order against EH. Nor were the proceedings a device to give jurisdiction over EH under Art.6(1) Brussels Convention.Appeals dismissed.

[2003] EWCA Civ 14