Marketmaker Technology (Beijing) Co Ltd & Ors v CMC Group Plc & Ors

A breach of an undertaking to the court constitutes contempt where the breach is proved to the criminal standard, the conduct was intentional or deliberate, and the alleged contemnor knew the facts making it a breach. The person need not appreciate that the conduct breached the undertaking.

An undertaking to disclose documents concerning current means may impose a continuing obligation until fully discharged. An existing breach may encompass later failures to update documents concerning an asset existing when the committal application was issued. A failure involving a subsequently acquired asset requires a further application notice.

The first and third defendants applied to commit the fourth claimant for failing to discharge an undertaking to disclose documents concerning his means of satisfying substantial costs orders. The undertaking had been given to secure the setting aside of an earlier committal order.

The court considered whether the undertaking imposed a continuing disclosure obligation, whether the application notice covered later failures, what constituted documents within the claimant's control, and whether the proved breaches were intentional or deliberate. It examined several categories of personal and corporate financial documents and documents concerning land in Jordan.

1. Contempt established; penalty reserved. The fourth claimant was in contempt through intentional breaches of his disclosure undertaking concerning specified personal bank accounts, corporate accounts and bank statements, the bank statements of a holding company, and documents relating to his land in Jordan. The court reserved the appropriate penalty for further submissions.

2. A breach of an undertaking does not by itself establish contempt. The applicants had to prove to the criminal standard that the conduct was intentional or deliberate and that the alleged contemnor knew the facts which made it a breach. They did not have to prove that he appreciated that his conduct breached the undertaking or amounted to contempt. His knowledge of the undertaking and prolonged failure to disclose justified the necessary inference.

3. The undertaking required disclosure of documents within the claimant's control when disclosure was made and concerning his current means. It was not confined to documents or means existing on the date when the undertaking was given. The obligation continued until the undertaking had been discharged in full.

4. The application notice could support findings concerning a continuing failure to update documents for accounts or assets which existed when the notice was issued. Such later omissions were aspects of the original continuing breach. The notice could not support contempt findings for failures concerning accounts or assets which came into existence only afterwards. Those failures required a further application notice.

5. General contractual principles applied when construing the undertaking, and a genuine ambiguity would be resolved in favour of the person who gave it. The proposed restriction to means existing on the undertaking date was not an available meaning of its words. The undertaking was therefore unambiguous.

6. Documents physically held by the claimant as a company director were at least within his control. In context, the obligation to disclose also required their production. Commercial sensitivity did not excuse non-disclosure, and corporate documents relating to a company from whose profits he was entitled to receive 40% related to his means.

7. The application notice and subsequent detailed allegations gave sufficient notice of the case. Although the original allegation was general, no documents had then been produced, later particulars were supplied, and the claimant answered them without unfairness.

• High Court: In an interlocutory judgment, [2008] EWHC 1556 (QB), Teare J determined preliminary issues and adjourned the committal application.

• Court of Appeal: On 28 July 2008, Hallett LJ dismissed the fourth claimant's application for permission to appeal from the interlocutory judgment.