Bank of Tokyo-Mitsubishi UFJ, Ltd v Baskan Gida Sanayi VE Pazarlama AS & Ors

Applications to strike out or obtain summary judgment are governed by the ordinary tests, even where there is substantial inequality of arms. The court asks whether the pleading discloses reasonable grounds and whether the evidence shows a real, more than fanciful, prospect of success. It must assess the case in the round and avoid conducting a mini-trial, including premature findings on credibility. An unlawful means conspiracy requires an agreement to use unlawful means, knowledge that those means will be used, and knowledge that damage to the claimant is reasonably foreseeable as a probable consequence. The requirement that the conspiracy be aimed or directed at the claimant is satisfied where injury is the natural and probable consequence of the deliberate acts.

The claimants brought substantial commercial proceedings arising from a loan facility made to Baskan Gida Sanayi VE Pazarlama AS. They alleged that assets and hazelnuts subject to their security had been transferred to associated companies, leaving Baskan Gida unable to repay the lending.

The twelfth defendant, Shabbir Abidali, was alleged to have participated in an unlawful means conspiracy with members of the Baskan family and associated companies. He applied under CPR 3.4(2) to strike out the claim and, alternatively, under CPR 24.2 for summary judgment. The central issues were whether the re-amended pleading disclosed reasonable grounds and whether the evidence established a real prospect of success.

1. Ordinary threshold. Inequality of arms did not justify a heightened test under CPR 3.4(2) or CPR 24.2. The court’s task remained to exclude unreal, fanciful or hopeless cases while allowing claims requiring trial to proceed. The Civil Procedure Rules overriding objective was served by proportionate case management, not by changing the applicable tests.
2. Strike out. A pleading dependent on inference and knowledge should ordinarily be assessed as a whole. The court should not examine each particular in isolation or allow the application to become a mini-trial. An exception may arise where an allegation would require lengthy and expensive evidence but has no significant consequence for the claim. The re-amended particulars, taken as a whole, disclosed reasonable grounds for an unlawful means conspiracy.
3. Summary judgment. The evidence also had to be considered in the round. Questions of credibility and the relative strength of competing accounts were matters for trial. The claimants’ evidence showed a real prospect that the defendant knew of and participated in the asset-stripping arrangements, although it did not establish an unanswerable case. The summary judgment application was therefore unsuitable for resolving the disputed issues.
4. Unlawful means conspiracy. The applicable law, identified by reference to Lonrho v Fayed [1992] AC 448 and Kuwait Oil v Al Bader [2000] 2 All ER Comm 271, required agreement to use unlawful means, knowledge that unlawful means were to be employed, and knowledge that damage to the claimant was reasonably foreseeable as a probable consequence. The conspiracy need not be directed solely at the claimant; the requirement was satisfied if injury to the claimant was the natural and probable consequence of the deliberate acts.
5. Disposition. The applications under CPR 3.4(2) and CPR 24.2 were dismissed.

This was a first-instance interlocutory decision. The twelfth defendant was added to the proceedings on 2 February 2007. Permission to re-amend the particulars of claim was granted on 10 May 2007. His applications, made on 30 November 2007, were dismissed.