Sandhu v Kaur

Allegations of contempt of court must be proved to the criminal standard, namely beyond reasonable doubt. An undertaking must be construed according to its language. Where one limb is expressly qualified by a reasonable-endeavours obligation and another is unqualified, the latter imposes an absolute obligation. A failure to make original documents available for inspection may therefore constitute contempt where the evidence proves both the obligation and the breach beyond reasonable doubt.

The applicant alleged that the respondent had committed contempt by making knowingly false statements in two witness statements and by breaching an undertaking given during disclosure proceedings. The statements concerned alleged transfers of shares in companies connected with the parties’ business interests. The undertaking required the respondent to use reasonable endeavours to obtain and disclose specified documents and to make the originals available for inspection.

The court had to determine whether the allegations were proved to the criminal standard and, in particular, whether the inspection obligation was itself qualified by the reasonable-endeavours wording.

1. Standard of proof. Allegations of contempt had to be proved beyond reasonable doubt. The allegations concerning the witness statement of 19 August 2009 were not established. The evidence relied on by the applicant was substantially hearsay, while the respondent’s accountant gave direct evidence that the relevant share transfer had been executed on the stated date.
2. The allegations concerning the witness statement of 1 December 2009 were also not proved. Although there were substantial reasons to question the authenticity and dating of documents relating to the alleged share transfers, the evidence did not establish beyond reasonable doubt that the respondent had dishonestly fabricated them.
3. Construction of the undertaking. The undertaking’s first limb was qualified by the words reasonable endeavours. Its second limb, requiring the respondent to make original documents available for inspection, was unqualified and imposed an absolute obligation.
4. The respondent had in any event failed to use reasonable endeavours to make the documents available for inspection. The correspondence showed that access had been refused or redirected to the company, despite the respondent’s personal undertaking. Her position as a director and substantial shareholder gave her a realistic ability to procure inspection, and there was no compelling evidence that she lacked that ability.
5. The allegation of breach of the undertaking was proved. The court found contempt in respect of that breach and reserved the question of penalty for further submissions.