Faryab v Philip Ross & Company

A claim is not an abusive collateral attack merely because it raises issues considered in earlier litigation. The critical question is whether it seeks to reopen the earlier decision itself. Relitigation may be permissible where genuinely new evidence entirely changes the aspect of the case. A professional negligence claim based on what should have occurred during negotiations is distinct from the earlier substantive dispute and may proceed on issues relevant to duty, breach and loss. Allegations that amount to reopening the earlier judgment should be excluded. A party seeking to challenge alleged misconduct by lawyers in existing proceedings should ordinarily bring a separate action. A restraining order requiring prior permission for further connected proceedings may be justified where repeated litigation demonstrates a clear need for a procedural filter.

Farhad Faryab appealed against orders striking out two sets of proceedings. Garland J had struck out the action against Philip Ross and Company, subject to limited permission to appeal concerning a possible breach of duty claim. Neuberger J later struck out a Chancery action against Mrs Smyth, Mr Golinsky and Mr Sookias, and made a restraining order concerning further proceedings connected with the earlier litigation.

The earlier Smyth action had been dismissed after a lengthy trial and the appeal had been dismissed. The central issues were whether the proposed amendments were within the limited permission granted, whether they constituted an abusive collateral attack, whether additional defendants should be joined, and whether permission should be granted to appeal the Chancery orders.

Appeal against Garland J’s order. The appeal was allowed only to the extent necessary to permit allegations of breach of duty of care, whether formulated in contract or tort. Such a claim was not a rerun of the Smyth action. It started where that action ended, alleging that proper conduct during negotiations might have produced an enforceable agreement. Issues relevant to the existence of a duty, breach and resulting loss were therefore open for determination, even if similar issues had arisen in the earlier proceedings.

1. Relitigation is not automatically an abuse. Under Hunter v Chief Constable of West Midlands [1982] AC 529, a collateral attack may be permissible where new evidence entirely changes the aspect of the case. No such evidence had been identified here.
2. Amendments reintroducing allegations that attacked findings made in the Smyth action were outside the limited permission to appeal and constituted an abusive attempt to reopen matters already determined. The specified paragraphs were therefore excluded.
3. The allegations against Reynolds Porter Chamberlain and Mr Nash concerned alleged misconduct in the conduct of the Philip Ross proceedings. There was no justification for joining them as defendants in those same proceedings. Any such claim should be brought by a separate action.
4. The court did not need to decide the distinction discussed in Darker v Chief Constable of the West Midlands [2000] 3 WLR 747 between evidence given by a witness and fabrication of evidence, because the collateral-attack conclusion was sufficient.
5. The Chancery action was properly struck out as an attempt to obtain, in substance, a retrial of the Smyth action without the required new evidence. The restraining order was also justified. The terms of the procedural filter approved in Ebert v Venvil [2000] Ch 484 were appropriate in circumstances showing a clear risk of further connected proceedings.

Permission to appeal against Neuberger J’s orders was refused. The appellant was required to serve a revised statement of case and was ordered to pay costs in the proportions specified by the court.

• Court of Appeal (Civil Division): Garland J’s order striking out the Philip Ross action was varied so that a confined breach of duty claim could proceed. Further amendments and joinder of additional defendants were refused. Permission to appeal against Neuberger J’s orders was refused.
• Queen’s Bench Division: Garland J struck out the Philip Ross action. The judgment does not give a separate citation for that order.
• Chancery Division: Neuberger J struck out the Chancery action and made a restraining order concerning further connected proceedings. The judgment does not give a separate citation for those orders.