Alibrahim v Asturion Fondation

A claimant’s unilateral decision to pause proceedings for a substantial period may amount to an abuse of process, but it does not do so automatically. The court must assess the claimant’s reason for the pause, its objective strength and the length of the delay. A claimant should seek the other party’s consent or a stay from the court, but failure to do so is not itself conclusive.

Under Civil Procedure Rules rule 3.4(2)(b), the court first decides whether there has been an abuse and then decides whether strike-out is just. Even where abuse is established, strike-out may be disproportionate if directions, unless orders or costs sanctions would adequately address it.

Asturion sought to recover a London property which it alleged had been transferred gratuitously to Ms Alibrahim without the foundation’s authority. The claim was protected by a notice at the Land Registry. After the parties and the court had failed to progress directions, Asturion did not take steps in the English proceedings for about ten months while the authority of its board was being litigated in Liechtenstein.

A Master struck out the claim for abuse of process on the basis that Asturion had unilaterally warehoused it. The High Court allowed Asturion’s appeal in [2019] EWHC 274 (Ch). Ms Alibrahim appealed, contending that the unilateral pause was abusive and that the High Court should not have intervened. The central issue was the legal test for abuse of process by warehousing proceedings and whether strike-out was justified.

1. Appeal dismissed. Arnold LJ, with whom Leggatt LJ and the Senior President of Tribunals agreed, held that the High Court was entitled to set aside the Master’s order and that its decision should stand.
2. Mere delay, however inordinate or inexcusable, is not by itself an abuse of process. The authorities, including Grovit v Doctor [1997] 1 WLR 640 and Arbuthnot Latham Bank Ltd v Trafalgar Holdings Ltd [1998] 1 WLR 1426, establish that a claimant’s unilateral decision not to pursue a claim for a substantial period may be abusive even if it intends to pursue it later. Whether it is abusive depends on the objectively assessed reason for the pause and its strength, having regard to the delay’s length.
3. The Master misdirected himself by treating a unilateral decision to place proceedings on hold for a significant period as automatically abusive. He considered Asturion’s reason only at the remedial stage, mischaracterised that reason, and treated Grovit v Doctor as equivalent although that case concerned a claimant with no intention ever to take the claim to trial.
4. The correct analysis under Civil Procedure Rules rule 3.4(2)(b) has two stages: first, whether there has been an abuse; secondly, whether strike-out is the just exercise of discretion in all the circumstances. There is no separate intermediate stage requiring the abuse to meet an independent threshold of seriousness.
5. The High Court was entitled to find that the ten-month pause was not abusive. Asturion should have sought consent to a stay or applied to the court, but its reason was objectively reasonable: its board’s authority to pursue the claim was under challenge in Liechtenstein, in proceedings brought by Ms Alibrahim, who had also criticised the costs of the English claim.
6. In any event, strike-out would have been disproportionate. The alleged abuse was relatively minor and could have been addressed by tight directions, unless orders or a costs sanction. Asturion’s failure to disclose its assets was relevant to a possible security-for-costs application, but not to the alleged warehousing abuse or the proportionality of striking out the claim.

• Court of Appeal (Civil Division) Dismissed Ms Alibrahim’s appeal and upheld the setting aside of the strike-out order: [2020] EWCA Civ 32.
• High Court of Justice, Chancery Division Allowed Asturion’s appeal from the Master, holding that the Master had erred in law and in the exercise of discretion: [2019] EWHC 274 (Ch).
• Deputy Master Struck out Asturion’s claim for abuse of process arising from alleged warehousing of the proceedings.