KJM Superbikes Ltd v Hinton

Proceedings for contempt based on a knowingly false verified witness statement are public proceedings. A private applicant acts in the public interest, and witness immunity does not bar such proceedings. Permission under rule 32.14 of the Civil Procedure Rules requires a strong case that the statement was false and that its maker knew it was false.

The court must then assess the public interest, including the statement’s significance, the maker’s state of mind, its actual or likely effect, the gravity of the alleged interference with justice, the applicant’s direct interest and the resources required. Permission demands great caution, but ordinary enforcement may reinforce the importance of statements of truth. A foreign witness should generally remain subject to the same discipline despite practical enforcement difficulties.

Honda brought trade mark proceedings against KJM Superbikes Ltd concerning motorcycles imported from Australia. Mr Hinton, an employee of Honda’s Australian subsidiary, supplied a verified witness statement supporting Honda’s application for summary judgment. Disclosure later showed that material parts of his statement were untrue, and he admitted that he had known this when making them.

After Mr Hinton gave evidence at trial, KJM applied under rule 32.14 of the Civil Procedure Rules for permission to bring contempt proceedings. Sir Andrew Park accepted that the conduct amounted to contempt but refused permission as disproportionate. KJM appealed. The central issue was whether the public interest required permission, having regard to witness immunity, the appropriate threshold, the relevant discretionary factors and Mr Hinton’s residence abroad.

1. Appeal allowed unanimously. Moore-Bick LJ held, with Arden and Mummery LJJ agreeing, that the judge had erred in exercising his discretion. Although the judge recognised the alleged contempt as serious, he failed to give its gravity proper weight and was unduly influenced by factors of little or no significance.

2. Proceedings for contempt concerning a knowingly false verified witness statement are public in nature. Applying Malgar Ltd v R.E. Leach (Engineering) Ltd [2000] FSR 393, the controlling question is whether the public interest requires proceedings. A private applicant who receives permission acts in a public role and must be a proper person to pursue that interest. Witness immunity prevents a private claim for damages arising from evidence, but does not immunise a witness from public accountability and punishment for interfering with justice.

3. The court must exercise great caution before granting permission. It should not do so unless there is a strong case that the statement was false and that its maker knew it was false. It must then consider all relevant circumstances, including the statement’s significance, the maker’s understanding of its likely effect, its actual use, the gravity of the alleged contempt, whether the applicant was directly affected and whether proceedings justify the necessary resources. The court approved the caution expressed in Kabushiki Kaisha Sony Computer Entertainment Inc v Ball [2004] EWHC 1192 (Ch).

4. At the permission stage the court does not determine whether contempt occurred. It asks whether the complaint, if established, is one which the public interest requires to be pursued. Reasons must be given without prejudicing either the contempt proceedings or unresolved substantive litigation. The overriding objective and the danger of disruptive satellite litigation must be considered. The court approved the guidance in Daltel Europe Ltd v Makki [2005] EWHC 749 (Ch) that disputed allegations of falsity should generally be resolved at trial with the full evidence available.

5. Mr Hinton had admitted knowingly making material untrue statements in support of an application which could have exposed KJM to a substantial liability. Difficult cross-examination carried little weight. Potential penalty was relevant only as an indication of seriousness, while remorse and personal mitigation belonged principally to the later sanction stage. Proceedings could reinforce the significance of statements of truth even without widespread publicity. Mr Hinton’s residence abroad and the practical limits on service or enforcement did not outweigh the public interest, since foreign witnesses should remain subject to the same standards as domestic witnesses. Permission to bring contempt proceedings was therefore granted.

• Court of Appeal (Civil Division): In KJM Superbikes Ltd v Hinton [2008] EWCA Civ 1280, the court unanimously allowed KJM’s appeal and held that permission to bring contempt proceedings should be granted.

• High Court, Chancery Division: Sir Andrew Park accepted that Mr Hinton’s conduct amounted to contempt but refused KJM permission to bring proceedings because he considered them disproportionate. No neutral or report citation for that decision is stated.