Akkurate Limited (in liquidation) & Ors v John Christopher Richmond & Anor

Summary judgment or strike out is inappropriate where the claim raises substantial factual disputes, credibility issues, developing legal questions, or matters requiring fuller evidence at trial. The court may decide a short point of law or construction summarily where the evidence is sufficient, but must avoid conducting a mini-trial.

Fiduciary obligations after compulsory liquidation are fact-sensitive. A former director may arguably remain subject to duties concerning company property, information or opportunities where the person continues to exercise an unusual stewardship or assumes responsibility for the relevant asset. Alleged dishonest assistance and conspiracy may likewise proceed where contemporaneous documents provide a non-speculative basis for the pleaded inference.

The liquidators of Akkurate Limited brought claims against its former director, John Richmond, and Mark Schofield. The claims concerned the alleged concealed acquisition and exploitation of the Company’s trademarks and stock, dishonest assistance, conspiracy, and alleged fraudulent misrepresentations inducing a 2019 settlement of earlier proceedings.

Both defendants applied for reverse summary judgment and/or strike out. The applications raised whether parts of the claims had been compromised by the 2019 Settlement, whether Mr Richmond could owe fiduciary duties after the Company entered compulsory liquidation, and whether the claims disclosed a real prospect of success.

1. Disposition. The applications for reverse summary judgment and strike out were dismissed. No part of the claim was struck out. The issues were suitable for determination at trial.
2. Summary judgment principles. The court applied the principles in Easyair Ltd (Trading As Openair) v Opal Telecom Ltd and the caution in Partco v Wragg. The court must assess whether the claim is realistic rather than fanciful, but must avoid a mini-trial. Summary disposal may be appropriate for a short point of law or construction where the necessary evidence is available. It is inappropriate where fuller investigation, disclosure and cross-examination may affect the outcome.
3. 2019 Settlement. There was at least a real prospect that “all claims in the Proceedings” referred to the claims pleaded after an order requiring statements of case, rather than every matter mentioned in an earlier witness statement. The pleaded claims did not clearly include post-liquidation conduct concerning the trademarks. Clause 5.2, which referred to conduct before liquidation, provided further support for that construction. The settlement issue was also closely connected with other claims and with possible abuse of process or res judicata issues reserved for trial.
4. Fiduciary duties. Although Measures Brothers Ltd v Measures supported the proposition that a directorship ends on compulsory liquidation, it did not necessarily determine whether fiduciary obligations concerning particular company assets could continue. The statutory duties in Companies Act 2006, including sections 170, 175, 176 and 177, and the fact-specific authorities on fiduciary relationships left an arguable case that Mr Richmond owed duties of no conflict, no self-dealing and disclosure concerning the trademarks.
5. Factual claims. Numerous contemporaneous communications supported a non-speculative case that Mr Richmond and Mr Schofield had worked together to acquire the trademarks and conceal Mr Richmond’s interest. The trademark, stock, dishonest assistance and conspiracy claims involved closely related facts and credibility issues which could not fairly be resolved summarily.
6. Misrepresentation. The alleged representations about Mr Richmond’s assets, interests and resources were adequately pleaded. Whether they were false, fraudulent and relied upon required disclosure and cross-examination. Suspicion did not necessarily negative reliance, and the evidential presumptions applicable to fraudulent misrepresentation were difficult to rebut at an interlocutory stage.