Byers & Anor (Joint Official Liquidators Saad Investments Co Ltd) v Samba Financial Group

In a claim for an account of trust property or equitable compensation, an earlier valuation date is not justified merely because the property has fallen in value before judgment. A claimant must identify a proper legal or factual basis, such as an pleaded case that the property should have been realised earlier or that the claimant would have sold it after restitution. A valuation date chosen only for evidential convenience is adventitious and does not make an amendment reasonably arguable. The court may also refuse a late amendment where it would require new evidence and alter the issues shortly before trial.

The joint official liquidators of Saad Investments Company Limited applied at a pre-trial review for permission to amend the prayer to their particulars of claim. They sought to add the value of disputed securities at 31 January 2020 as an alternative valuation date for equitable compensation relating to alleged trust property.

The proposed date was the date used by expert valuers and preceded a substantial fall in share values associated with the Covid-19 pandemic. The defendant opposed the amendment, arguing that the date had no proper legal foundation and would require further evidence about the exercise of the court’s equitable discretion. The issues were whether the defendant’s conduct had deprived the claimants of an earlier judgment and whether the court had a broad discretion to select an earlier valuation date.

1. Application refused. The claimants were not permitted to amend their prayer to plead 31 January 2020 as an alternative valuation date.
2. The argument that the defendant’s conduct had deprived the claimants of an opportunity to obtain judgment before 31 January 2020 was unsustainable. The trial would have proceeded on the same date, and the defendant would in any event have been permitted to defend the same identified issues.
3. There was no support in the authorities for selecting an earlier valuation date in an account of trust property or equitable compensation merely because the property had fallen in value before judgment. The reasoning in Global Energy Horizons Corporation v Gray concerned the assessment of profits stripped from a fiduciary and did not establish such a principle for an account of trust property.
4. An earlier date might have a proper foundation where it was pleaded that the trustee should have realised the property earlier, or that the beneficiary would have sold it after receiving restitution. Neither case was pleaded here.
5. The proposed date was purely adventitious, having been selected for the convenience of expert valuation. The amendment would raise new evidential questions and alter the directed list of issues at a late stage of trial preparation. Permission would therefore have been refused independently on case-management grounds.