GB Minerals Holdings Ltd v Short

Permission to bring committal proceedings for false statements should be granted only after a cautious assessment of whether there is a strong prima facie case of dishonesty and whether the public interest requires proceedings. The court should also consider whether the proposed proceedings would cause disruption or oppression, whether they are proportionate, and when they should be heard. False statements in pleadings supported by statements of truth engage the same public interest in preserving the integrity of the litigation process as false witness statements. Overlap with the issues at trial does not itself prevent permission, but may justify directing that the committal proceedings be heard at or after the trial. The opposing party may bring the proceedings where the relevant safeguards are satisfied.

GB Minerals Holdings Ltd applied for permission to bring committal proceedings against Michael Short in connection with substantial underlying contractual proceedings between GBM Minerals Engineering Consultants Ltd and GB Minerals Holdings Ltd. The application concerned pleaded assertions, supported by a statement of truth, that seventeen contractual Variation Orders had been agreed and signed contemporaneously. Disclosure indicated that the documents had instead been created and signed after the events they purported to record.

The central issues were whether there was a strong prima facie case of dishonesty, whether the public interest required committal proceedings, whether the allegations were sufficiently central to the underlying dispute, and whether proceedings should be heard before the forthcoming trial.

1. Permission granted. There was a strong prima facie case that Mr Short had dishonestly created and maintained a false account of the Variation Orders. The conclusion was based on the contemporaneous emails, the apparent motive arising from increasing financial scrutiny, and the absence of a credible explanation. The question of actual dishonesty remained for the committal proceedings.
2. The court adopted the approach identified in KJM Superbikes Ltd v Hinton (Practice Note) [2008] EWCA Civ. 1280. The relevant questions were whether there was a strong prima facie case of dishonesty, whether the public interest required proceedings, and whether the applicant was a proper person to bring them. The court then had to consider disruption, oppression, proportionality and timing.
3. There was a strong general public interest in ensuring that pleadings supported by statements of truth were truthful. The court drew no relevant distinction between such pleadings and witness statements. The alleged false statements were also central because the validity of the Variation Orders was likely to be important both to the claim for unpaid sums and to the counterclaim for restitution or damages.
4. Overlap with the civil trial did not itself require refusal of permission. However, the overlap made it inappropriate to hear the committal proceedings in advance. The proceedings were directed to be heard at or after the trial, at the discretion of the trial judge. They might be dealt with at the trial itself.
5. It was not inappropriate for the applicant, rather than the Attorney General, to bring the proceedings. The costs of the permission application were provisionally reserved.