Schwartz v VGV (UK) Ltd & Ors

Sentencing for contempt requires assessment of culpability and harm, followed by consideration of aggravating and mitigating factors. A fine must be imposed if sufficient; imprisonment is justified only where the contempt crosses the custody threshold. Personal mitigation may reduce the term but may not justify suspension where the breach is exceptionally serious. The contemnor must be punished only for the contempts proved, not for separate wrongdoing.

The judgment determined sanctions and costs following an earlier committal judgment. Breaches by VGV (UK) Ltd and Mr Vivanco had been partly proved. VGV UK was subsequently wound up and took no part in the hearing.

Mr Vivanco had failed to provide trust-asset information and had failed to provide a digital copy of a purported second letter of wishes, giving a dishonest explanation. The court determined the appropriate sanctions, whether imprisonment should be immediate, and liability for costs.

1. Although VGV UK’s breaches were proved, no penalty was imposed because it was in liquidation and any penalty would harm creditors, including the claimant, having regard to section 130(2) of the Insolvency Act 1986.
2. Mr Vivanco’s delayed provision of trust-asset information was serious and prejudicial but was later purged. A financial penalty would have been sufficient, but no further penalty was imposed because of the custodial sentence for the second contempt.
3. The second contempt concerned only failure to provide a digital copy of the existing document without a good explanation. The court did not impose a sanction for the alleged forgery itself.
4. The breach was deliberate, flagrant and prejudicial. It crossed the custody threshold, so a fine was insufficient and immediate imprisonment was required. Personal mitigation reduced the sentence from six to four months but did not justify suspension.
5. Costs were apportioned according to the allegations proved and the parties’ conduct. CPR rule 81.9(3) permitted service of the committal order by email because of the pandemic.

First-instance sanctions judgment following the court’s earlier committal judgment. A right of appeal to the Court of Appeal was stated.