Walbrook Trustees (Jersey) Ltd & Ors v William Fattal & Ors

A later claim may be an abuse of process even where it raises an issue that has not previously been adjudicated. The court must make a broad, merits-based assessment of all the circumstances, including whether the issue could and should have been raised earlier, the public interest in finality, and the private interests of the parties. A party cannot avoid that conclusion by relying on a formal distinction between the later claim and earlier proceedings, or by showing that the claims are technically consistent. Where the party knew, or should have known, the material circumstances and adopted a staged approach to litigation, the later claim may be struck out.

The Fattals sought to establish that the Sharet Trust did not have an effective 25% interest in Berkeley Court because the transfer of Interlands’ share had triggered pre-emption rights under the joint venture agreement. The issue was raised in a new Part 7 claim directed by the court after an earlier preliminary issue had established that a sale had occurred.

The defendants applied to strike out the New Claim as an abuse of process. They relied on the Fattals’ knowledge of the transaction before the 2003 proceedings, in which the Fattals had proceeded on the footing that the Sharet Trust held a 25% interest. The central issue was whether the Fattals could litigate in 2008 an issue which could and should have been raised in 2003.

1. The New Claim was struck out as an abuse of process. The question whether the Sharet Trust had a 25% interest could have been raised in the 2003 proceedings. The Fattals knew that a sale had occurred and that the share was intended to pass to the Sharet Trust.
2. The applicable approach was the broad, merits-based assessment stated in Johnson v Gore Wood & Co [2002] 2 AC 1. The court had to ask whether, in all the circumstances, the later litigation misused the court’s process and unjustly harassed the other parties.
3. The public interest in finality and efficient use of court resources remained important. The Fattals should have advanced their whole case rather than proceed by stages.
4. The defendants’ own misconduct and Walbrook’s disclosure shortcomings did not create an estoppel or prevent reliance on abuse of process. Those matters did not outweigh the interests supporting finality.
5. It was unnecessary to determine waiver or limitation. The strike-out order applied to the amended New Claim and did not prejudice separate claims against Walbrook.