Heathcliffe Properties Ltd v Dodhia & Anor

A sentence for contempt of court serves both punitive and coercive purposes. The court may impose imprisonment, suspend all or part of a custodial sentence, or impose an unlimited fine. The assessment must reflect culpability and harm, together with matters such as admission, remorse, subsequent compliance, personal circumstances and character. There is no rule against imprisonment for a first offence, although keeping first offenders out of prison remains desirable. The sentence should not be manifestly disproportionate to one imposed by a criminal court for the same conduct. Where deliberate non-compliance is serious but falls below the level warranting immediate custody, and the purpose of the order has subsequently been secured, a substantial fine may be appropriate.

The claimant applied to commit the defendants for contempt after they failed to attend a hearing required by an order made on 10 May 2016. The hearing had been relisted for 14 June 2016, but neither defendant attended. They admitted the breach and apologised. The committal application was heard on 20 September 2016, when the court found both defendants in contempt and deferred sentence to obtain evidence of their financial circumstances.

The underlying proceedings concerned a long-running partnership dispute and the sale of partnership properties. The court considered the defendants’ persistent obstruction as relevant to the seriousness of the breach and the prospects of future compliance, but sentenced them only for the specific failure to attend the hearing.

1. Sentencing principles. The court derived guidance from Otkritie International Investment Ltd v Gersamia [2015] EWHC 821 (Comm), HMRC v Munir [2015] EWHC 1366 (Ch) and Asia Islamic Trade Finance Fund Ltd v Drum Risk Management Ltd [2015] EWHC 3748 (Comm). Contempt sentencing has both punitive and coercive purposes.
2. The court could impose immediate custody, suspend all or part of a custodial sentence, or impose a fine. Custody may be appropriate for serious contumacious flouting, but there is no rule preventing imprisonment for a first offence. The court must also consider the desirability of keeping first offenders out of prison.
3. The relevant assessment included culpability, harm, admission, remorse, belated compliance, personal circumstances and character. The sentence should not be manifestly discrepant from a criminal sentence based on the same facts.
4. The defendants had deliberately failed to attend an important hearing. Their breach formed part of a persistent refusal to accept the authority of court orders. Nevertheless, the breach was less serious than breaches that had attracted custody. They had since attended court, admitted the breach, apologised and promised future compliance. The purpose of the attendance order had therefore been belatedly secured.
5. An immediate custodial sentence was not justified. A suspended sentence conditional on future conduct would risk pre-judging the sentence for any later breach. Each defendant was able to pay a substantial fine. The court imposed a separate fine of £25,000 on each defendant and indicated that costs would also be addressed.

not stated in the judgment.