Clutterbuck & Ors v Cleghorn

A court deciding whether later proceedings are an abuse of process must make a broad, merits-based assessment of all the circumstances, including the public and private interests involved. A claim is not abusive merely because it could have been brought earlier.

A party wishing to reserve a related claim for later proceedings must disclose it to the court managing the existing litigation. An inexcusable failure to do so is important but not conclusive. A distinct claim against another party should remain available where it concerns different subject matter, the earlier court made no relevant findings, and a further trial would not cause unfair duplication, manifest unfairness or damage to the administration of justice.

The claimants alleged that a deceased property investor had incurred liabilities arising from three groups of property-development arrangements: the Pont Street Claim, the Oriel Claim and the written Cliveden joint venture agreement. The defendant, as judicial factor to the deceased's estate, obtained an order striking out all three claims as an abuse of process.

The deputy judge found that the claims should have been referred for case-management directions during earlier proceedings brought by the claimants against another alleged participant. He also found that the Pont Street and Oriel Claims were abusive collateral attacks upon findings made in those proceedings, reported at [2014] EWHC 383 (Ch).

The issues on appeal were whether the Aldi Stores guidelines applied, whether their breach made the proceedings abusive, and whether striking out every claim was justified. The claimants also sought permission to adduce further evidence.

1. Appeal allowed in part. The appeal was dismissed in relation to the Pont Street and Oriel Claims but allowed in relation to the Cliveden Claim. The application to adduce further evidence was refused.

2. The court must protect its process from misuse while ensuring that a genuine claim is denied a hearing only after scrupulous examination of all the circumstances. Henderson v Henderson abuse requires a broad, merits-based judgment addressing the public and private interests, the particular facts and whether the later proceedings constitute unjust harassment or otherwise misuse the court's process. The fact that a matter could have been raised earlier does not make its later pursuit necessarily abusive: Johnson v Gore Wood & Co [2002] 2 AC 1 applied.

3. The Aldi Stores guidelines were mandatory and applied to all three claims. A party to commercial litigation wishing to pursue a related claim later must disclose that position to the court seised of the existing proceedings. This permits proportionate and efficient case management. An inexcusable failure to comply is a material factor in the overall assessment, but it is not independently dispositive: Aldi Stores Ltd v WSP Group plc [2007] EWCA Civ 1260 and Stuart v Goldberg Linde [2008] EWCA Civ 2 applied.

4. The Pont Street and Oriel Claims substantially repeated allegations, issues and evidence rejected in the earlier proceedings. Permitting them to continue would require the same matters to be tried again, consume substantial resources and seek reversal of adverse findings. Their pursuit therefore amounted to unjust harassment and an abusive collateral attack. In any event, the claimants had not appealed the deputy judge's independent collateral-attack finding.

5. The Cliveden Claim required separate assessment. It concerned a written agreement to which the defendant in the earlier proceedings was never alleged to be a party. The earlier judge had expressly declined to determine its merits and had used the agreement only as a contrast with the alleged oral ventures. A further trial therefore created no risk of inconsistent findings or wasteful duplication comparable to Gladman Commercial Properties v Fisher Hargreaves Proctor [2013] EWCA Civ 1466. Despite the failure to follow the Aldi Stores guidelines and the troubling earlier cross-examination concerning the project, pursuit of the Cliveden Claim was neither manifestly unfair to the estate nor damaging to the administration of justice.

6. The proposed evidence was available before the hearing below, did not persuasively support the asserted fraud and was unlikely to influence either the procedural strike-out application or the appeal.

1. Court of Appeal (Civil Division): By [2017] EWCA Civ 137, dismissed the appeal concerning the Pont Street and Oriel Claims, allowed the appeal concerning the Cliveden Claim, and refused permission to adduce further evidence.

2. High Court, Chancery Division: Edward Murray, sitting as a deputy judge, decided on 11 September 2015 that all three claims were an abuse of process. By a consequential order dated 9 October 2015, he struck out the proceedings, entered judgment for the defendant and awarded him his costs.