SAYED S. SANGAMNEHERI v THE CHARTERED INSTITUTE OF ARBITRATORS & ORS.

The claimant sought to reopen a long-running dispute about the conduct of an arbitration by asserting procedural defects (notably a "False Date" on an acknowledgement) and alleged concealment of documents, and advanced points under sections 16(3) and 18 of the Arbitration Act 1996 and on the law of the seat. The defendants applied to strike out the Part 7 and Part 8 claims and, alternatively, for summary judgment.

The court applied the established summary disposal principles, the pleading rules for allegations of dishonesty and the law on setting aside judgments for fraud. It concluded that the new arguments were legally misconceived, that there was no proper pleading or evidence to support an inference of conscious and deliberate dishonesty and that the matters relied on would not have changed the earlier decisions. The claims were therefore res judicata or an abuse of process and had no real prospect of success. The claimant's ancillary applications were also without merit.

As a result the Part 7 and Part 8 claims and the claimant's applications were dismissed as totally without merit and an Extended Civil Restraint Order was made against the claimant; the judge also referred the matter to the Attorney General for consideration of an indefinite civil proceedings order.

Background and parties:

• The claimant is a litigant in person who commenced arbitration proceedings in 2015 against a third party under a contract containing a CIArb arbitration clause. The claimant later sued his appointed arbitrator and sought to join the Chartered Institute of Arbitrators (CIArb), its president and various solicitors and employees in a range of proceedings alleging dishonesty, bad faith and enormous losses said to arise from non‑performance of the underlying contract for delivery of gold.
• Earlier proceedings culminated in judgments striking out claims as totally without merit and in the making of civil restraint orders against the claimant. After the expiry of an earlier ECRO the claimant issued fresh Part 8 and Part 7 claims in 2021 against the present defendants repeating and reformulating those complaints.

Nature of the applications before the court:

• The defendants applied under CPR 3.4(2) to strike out the Part 7 and Part 8 claims and, in the alternative, for summary judgment under CPR 24.2. They also sought an ECRO. The claimant sought default judgment in his Part 8 claim, a declaration that the arbitration was void ab initio, and the joinder of additional defendants.

Issues framed by the court:

1. Whether the new pleadings and applications had any real prospect of success or were "totally without merit" and therefore liable to be struck out or the subject of summary judgment;
2. Whether allegations of dishonesty were sufficiently particularised and supported so as to permit rescission of earlier judgments obtained purportedly by fraud (applying the principles in Royal Bank of Scotland v Highland and Takhar);
3. Whether the present claims were barred by res judicata or otherwise constituted an abuse of process; and
4. Whether an extended civil restraint order should be made.

Court's reasoning and conclusions:

• The court examined the facts relied on by the claimant (in particular the acknowledged receipt date on an Acceptance of Nomination form and subsequent voluntary disclosure of that document) and concluded there was no evidence of collusion or of conscious and deliberate concealment or dishonesty. The purported legal consequence relied on (that a slightly later recorded acknowledgement meant the appointment was unlawful under section 16(3) and that section 18 rendered the arbitration void) was legally misconceived. The Arbitration Act provisions relied upon did not have the drastic effect asserted, were displaced or limited where the parties chose a foreign seat and CIArb rules applied, and in any event would not have changed the earlier courts' approach.
• The court applied the established tests for striking out and summary judgment, and the requirements for pleading fraud/dishonesty, including the two-stage test for dishonesty (Ivey). The claimant had no real prospect of establishing the necessary elements to set aside the earlier judgments for fraud (conscious and deliberate dishonesty, materiality and causation) and therefore the earlier decisions remained binding.
• Accordingly the present claims were either res judicata on issues already finally determined or an abuse of process because they repeated earlier baseless allegations and amounted to unjust harassment of repeated defendant targets. The joinder application was impossible to sustain. The claimant's procedural applications (default judgment and declaration of void arbitration) were dismissed as misconceived.
• Given the persistent repetition of totally without merit claims and the recent history of prior civil restraint orders, the court concluded it was appropriate to make an Extended Civil Restraint Order in these proceedings and to refer the judgment to the Attorney General to consider an indefinite civil proceedings order under section 42(1) of the Senior Courts Act 1981. The judge signalled that indemnity costs against the claimant were likely.

The court dismissed the Part 7 and Part 8 claims and all of the claimant's applications as totally without merit, and ordered that an Extended Civil Restraint Order (ECRO) be made against the claimant. The judge held that the claimant had no real prospect of proving the alleged fraud or dishonesty, that the legal points advanced (including reliance on sections 16(3) and 18 of the Arbitration Act 1996 and on the law of the seat) were misconceived, and that the proceedings were res judicata or otherwise an abuse of process. The judge also referred the matter to the Attorney General for consideration of an indefinite civil proceedings order and indicated an order for costs on an indemnity basis was appropriate.