Silversafe Ltd & Anor v Hood & Ors

Permission to amend a fraud and knowing-receipt claim should generally be granted where the pleading identifies the case to be met, even though fuller particulars may depend on disclosure. Similar-fact evidence should not ordinarily be excluded before trial where its probative value cannot fairly be assessed without the full evidential picture. Case-management objections must be assessed proportionately. Tax-authority information may be used where domestic legislation authorises disclosure for civil proceedings connected with Revenue and Customs or insolvency functions.

The claim arose from alleged missing-trader intra-Community VAT fraud. Silversafe Ltd alleged that its director diverted trading receipts, including VAT, to third parties and that Tattershall Inversiones SL was liable in respect of sums paid to it.

The claimants sought permission to re-amend their Particulars of Claim to distinguish proprietary and personal trust claims and to rely on other transactions, tax-authority reports and similar-fact evidence. Tattershall objected that the pleading was insufficiently particularised, oppressive and disproportionate, and that some evidence had been obtained contrary to European tax-information provisions.

The central issues were whether the amendments should be permitted and whether the proposed evidence should be excluded at the interlocutory stage.

1. The proposed amendments adequately identified the allegation that Tattershall’s business was operated wholesale in VAT fraud. Fuller particularisation could follow disclosure. The court applied the approach in Arab Monetary Fund v Hashim (No 2) [1990] 1 All ER 673.
2. It was premature to strike out the similar-fact evidence. Its probative value was a matter for trial, and it arguably satisfied the test in O’Brien v Chief Constable of South Wales [2005] 2 AC 534. JP Morgan Chase Bank v Springwell Navigation Corporation [2005] EWCA Civ 1602 did not determine this fact-specific case-management issue.
3. The court held that the European information-sharing regime arguably extended to recovery of VAT duties. Domestic legislation also authorised disclosure for relevant Revenue and Customs and insolvency functions.
4. CPR 32.1 conferred a discretion to exclude otherwise admissible evidence. The factors overwhelmingly favoured admitting the material, subject to full disclosure. Permission to re-amend the Particulars of Claim was granted.