Walsh v Staines & Ors

An application to strike out or obtain summary judgment should be determined on the pleaded facts, assumed to be true for strike-out purposes, and by asking whether the claim has no real prospect of success rather than whether success is probable. A claim should not be summarily terminated where the relevant area of law is developing or uncertain and a trial may clarify the facts and law. Witness immunity is broad, but its application must be considered with recognised exceptions, including claims concerning a wider abuse of process. Where the pleadings disclose arguable deceit, reliance and loss, and the immunity issue cannot be resolved with certainty, the application should be refused.

Mr Walsh brought proceedings alleging fraudulent deceit and conspiracy against Mr Staines, his solicitors, Sprecher Grier Halberstam LLP, and the partner responsible for the earlier proceedings. The allegations concerned statements and omissions about Mr Staines’s financial position, including evidence supporting a freezing order and a subsequent solicitors’ letter concerning funds held on account.

The solicitors and partner applied under CPR 3.4 for strike-out or under CPR 24 for summary judgment. They argued that the pleadings disclosed no proper case of deceit, conspiracy or reliance, that the claim had no real prospect of success, and that witness immunity and public policy barred the claim.

1. Strike-out. For strike-out purposes, the pleaded facts were assumed to be true. The pleadings, read together, were capable of alleging false representations or omissions, knowledge of falsity, an intention to induce reliance, reliance and loss. The allegations were therefore not bound to fail.
2. Deceit and reliance. The pleaded representation need not be the sole cause of the claimant’s conduct if it contributed substantially to deceiving him. The evidence concerning the value of the flat, the August 2002 letter and the claimant’s solicitor’s understanding of that letter made it impossible to conclude that reliance was absent as a matter of law.
3. Summary judgment. Under CPR 24.2, the question was whether the claim was fanciful or entirely without substance, not whether success was probable. The documents and witness evidence left a real possibility that the claimant had been deceived by the financial information and that it had contributed substantially to his conduct.
4. Witness immunity. The authorities recognised a broad immunity for evidence given in or prepared for court proceedings, extending to solicitors, and justified by protection of witnesses and the integrity of the judicial process. The immunity should extend only so far as strictly necessary. The court could not, however, be certain that it barred this claim. The earlier decision concerning the continuing obligation relating to a cross-undertaking in damages created uncertainty about whether a freestanding duty was owed to the defendant as well as to the court. The pleaded facts also had a reasonable prospect of amounting to an abuse of process, engaging the exceptions recognised in the authorities.
5. The application by SGH and Mr Judge was dismissed. The issues of duty, deceit, reliance and the scope of witness immunity were left for trial.