Karim v Charkham & Ors

A fresh claim is not automatically abusive merely because its subject matter could have been raised in earlier proceedings. The court must make a broad, merits-based assessment of all the circumstances, including the public and private interests in finality and efficient litigation. A claim is abusive where it substantially reworks issues that can and should be determined in existing proceedings and amounts to misuse of the court process. An extended civil restraint order requires persistence in issuing claims or applications that are totally without merit. The former requirement to establish vexatiousness is unnecessary, but persistence must be shown, including an irrational refusal to accept adverse decisions.

The claimant issued a third High Court claim alleging fraud, dishonesty, unlawful conduct and invalidity concerning the lending, receivership, auction and transfer of residential property. Earlier proceedings concerning the same transactions were pending in the Central London County Court. A second claim arising from the same events had already been struck out as an abuse of process, and civil restraint orders had been made in related proceedings.

The defendants applied under CPR 3.4(2) to strike out the third claim and sought an extended civil restraint order. The issues were whether the new claim disclosed reasonable grounds or constituted an abuse of process, and whether the claimant’s history justified the restraint order.

1. Strike-out. The application under CPR 3.4(2) was allowed and the claim was struck out. The principles stated in Johnson v Gore Wood & Co (a firm) [2002] 2 AC 1 applied. The fact that an issue could have been raised earlier does not, by itself, make later proceedings abusive. The court must assess all the circumstances and ask whether the party is misusing or abusing the process by raising an issue in later proceedings.
2. The third claim disclosed no reasonable grounds and was an abuse of process. Its allegations substantially duplicated the issues in the existing proceedings, where they could and should be determined. The addition of defendants did not alter that conclusion, since they could be joined in the existing proceedings if necessary. The grave allegations against the first defendant were unsupported by particulars or evidence and contributed to the finding of harassment and abuse.
3. Extended civil restraint order. Paragraph 3.1 of Practice Direction 3C permits an extended civil restraint order where a party has persistently issued claims or made applications that are totally without merit. Following R (Kumar) v Secretary of State for Constitutional Affairs [2007] 1 WLR 536, it was unnecessary to establish vexatiousness separately. Persistence remained essential. The guidance in Attorney General v Barker [2000] FLR 759 and Bhamjee v Forstick & Ors [2004] 1 WLR 88 supported the requirement of continued and irrational refusal to accept adverse decisions.
4. The claimant’s repeated claims and applications, disregard of court orders, and reworking of earlier allegations established the necessary persistence. An extended civil restraint order was therefore made for two years, subject to the stated permission and appeal safeguards.
5. The claimant was ordered to pay the defendants’ costs. Costs were summarily assessed at £20,000 for the first to fifth defendants and £5,500 for the sixth defendant, on the indemnity basis. The hourly rates were reduced by reference to CPR 48.49.