David John Frosdick v The Official Receiver

An extended civil restraint order may properly prevent a party from pursuing a claim which, although framed as a new issue, is another attempt to litigate the same underlying dispute. Henderson abuse is assessed broadly and on the merits, having regard to all the circumstances, including whether the matter could and should have been raised earlier, delay, repetition and the public and private interests involved.

A challenge to an alleged failure by a judge to apply statutory set-off provisions must ordinarily be made by setting aside or appealing the order, rather than through a free-standing negligence claim. Judicial office-holders are immune from negligence claims arising from judicial functions under the Crown Proceedings Act 1947, section 2(5).

The applicant sought under paragraph 8(1) of an extended civil restraint order made by Martin Spencer J on 17 June 2022 to set it aside. The order restrained further litigation concerning his bankruptcy, the disclaimer of a potential professional-negligence claim against Cobbetts, and related claims against the Official Receiver and the trustee in bankruptcy.

He relied principally on an alleged breach of rule 6.125(7) of the Insolvency Rules 1986, and on an alleged failure by the bankruptcy judge to apply section 323 of the Insolvency Act 1986. The central issues were whether those matters provided a proper basis to set aside the restraint order and whether proposed further proceedings would be an abuse of process.

1. Application dismissed. There was no proper basis to set aside the extended civil restraint order made on 17 June 2022.
2. The alleged breach of rule 6.125(7) had not been fully litigated in precisely that form, but that did not make further litigation appropriate. The point had previously been raised, had been found totally without merit, and faced substantial limitation difficulties. More fundamentally, it was another way of challenging the Official Receiver’s handling of the disclaimer issue.
3. The court applied the Henderson abuse principles as explained in Johnson v Gore-Wood (No 1) [2002] 2 AC 1 and Aldi Stores Ltd v WSO Group plc [2008] 1 WLR 748. The assessment is broad and merits-based, taking account of all public and private interests and the whole factual context. It would be unfair to permit another claim arising from the same events after substantial delay and repeated attempts to litigate the dispute in different forms.
4. The section 323 argument concerned the validity of the original bankruptcy order. The proper route for alleging that the bankruptcy judge failed to apply statutory set-off was an application to set aside or an appeal against that order. Any further application would itself constitute Henderson abuse.
5. A free-standing claim against the Lord Chancellor based on the judge’s alleged failure would likewise be abusive and totally without merit. Judicial office-holders are immune from negligence claims arising from judicial functions under section 2(5) of the Crown Proceedings Act 1947. Bresco Electrical Services Ltd (In Liquidation) v Michael J Lonsdale (Electrical) Ltd [2020] UKSC 25, Anisminic Ltd v Foreign Compensation Commission [1969] 2 AC 147 and Stein v Blake [1996] 2 AC 243 did not provide a basis for avoiding that conclusion.

The judgment describes earlier proceedings concerning the applicant’s bankruptcy and related claims:

• High Court (Chancery Division): claims were struck out in Frosdick v Secretary of State for Business, Energy and Industrial Strategy and others [2016] EWHC 3008 (Ch) and Frosdick v Fox and Baker Tilly Creditor Services LLP [2017] EWHC 1737 (Ch).
• High Court (Queen’s Bench Division): a further claim was struck out in Foskett v The Official Receiver [2018] EWHC 1714 (QB), followed by an extended civil restraint order.
• High Court (King’s Bench Division): the present application to set aside the further order made on 17 June 2022 was dismissed.