Controlling and Coercive Behaviour: Widening the Net
In consolidated appeals, the appellant Prince (P) appealed against a series of related interim orders made in the course of proceedings between July and November 2013.
The first respondent company (X) and a company owned by P had decided to set up a third company to develop and market internet telecommunications technology. P and X later fell out and launched cross-petitions under the court's statutory jurisdiction to give relief against the unfairly prejudicial conduct of a company's affairs under the Companies Act 2006 s.994 to s.996.
On July 31, 2013, Vos J ordered that P should personally sign certain statements required to be made in connection with disclosure in the proceedings. P later claimed that, as a member of the Saudi Royal family, he was bound by a protocol under which he was prevented from taking part in litigation personally or from signing court documents. A witness statement was instead served on his behalf and signed by his adviser.
On September 9, 2013, Norris J ordered that P's defence would be struck out unless he complied with Vos’ J’s order. P did not comply. Norris J later entered judgment for X against P for almost $7 million plus costs pursuant to CPR r.3.5(2).
On 29 November 2013, P appealed to Mann J to vary the personal signature order so that he could provide the requisite information in a witness statement signed by his solicitor, but determined that there had been no misstatement of fact or material change of circumstances to justify varying Vos J’s order. Mann J perceived this as a hidden application to set aside the judgment and also dismissed P's applications to stay the judgment pending trial of the petitions and for relief from sanction.
P's case was that all the orders were wrongly made and as a result he made consolidated appeals in relation to the above decisions.The orders made by the three judges were upheld by the Court of Appeal. Lady Justice Arden gave the lead judgment, with which there was unanimous judicial consent.
Court of Appeal held
The Court of Appeal therefore dismissed all of the P’s appeals. As a result, the default judgment currently stands, awaiting Supreme Court judgment. It has been reported that Lord Neuberger, Lord Clarke and Lord Sumption granted permission to appeal to the Supreme Court on the condition that the US$7.7 million judgment sum was paid into the court by the Prince by 15 September 2014.
Appeal to the Supreme Court
On 13 October 2014, Lord Neuberger, Lord Clarke, Lord Sumption, Lord Hughes and Lord Hodge heard the appeal. On 26 November 2014 the appeal was dismissed and the importance of litigants obeying court orders was self-evident. Once a court order was disobeyed, the imposition of a sanction was almost always inevitable if court orders were to continue to enjoy the respect which they ought to have. And, if persistence in the disobedience would lead to an unfair trial, it seemed, at least in the absence of special circumstances, hard to quarrel with a sanction which prevented the party in breach from presenting or resisting the claim. And, if the disobedience continued despite the imposition of a sanction, the enforcement of the sanction was almost inevitable, essentially for the same reasons. The court might in a particular case be persuaded by special factors to reconsider the original order or the imposition or enforcement of the sanction, but there were no such factors here.
By Kristina Morgan, Paralegal, Dispute Resolution
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