Harrington & Charles Trading Company Limited & Ors v Jatin Rajnikant Mehta & Ors

Interlocutory applications must not be used to re-litigate arguability issues already determined on a freezing-order application. The abuse jurisdiction applies to successive interlocutory battles, even where the precise relief or applicant differs. A party seeking to raise a previously available point must ordinarily show a significant change of circumstances or genuinely new facts.

Strike out and summary judgment are unitary exercises concerned with whether a claim is realistically sustainable, rather than requiring the court to decide every difficult legal issue in advance of trial. The court should avoid prolonged summary determination where issues are fact-sensitive, legally uncertain, or unlikely to dispose of the proceedings. Alleged impropriety in related insolvency processes does not, without more, constitute abuse of the process of the court.

The claimants, companies in liquidation and their joint liquidators, brought claims arising from an alleged international fraud and money-laundering scheme. The first to fourth defendants applied under CPR 3.4(2)(a) and Part 24 to strike out the claims or obtain reverse summary judgment.

Earlier, Edwin Johnson J had refused to discharge worldwide freezing orders after finding that the pleaded claims met the good arguable case threshold. The defendants sought to advance substantially the same merits challenges in the present applications, together with an argument that the proceedings were an abuse because of the way the claimant companies had been restored, placed into liquidation and funded.

The issues were whether the repeated merits challenges were abusive, whether the contribution claim was inadequately pleaded, and whether the proceedings themselves constituted an abuse of process.

1. Strike Out Points (1)–(8). The defendants were precluded from pursuing the merits challenges. The earlier freezing-order judgment had assessed each claim against a threshold at least as demanding as the strike-out or summary judgment tests. The defendants had had a full opportunity to advance their arguments, substantially repeated them, and identified no material change of circumstances. Requiring the claimants to re-litigate those points would misuse court resources and vex the parties. The doctrine applied notwithstanding that the present applications sought different relief and that the earlier decision was interlocutory.
2. The court treated the relevant principles as those concerning successive interlocutory applications, drawing on Henderson and Hunter. Cause of action and issue estoppel did not apply because there had been no final determination. A collateral attack could nevertheless arise from seeking an inconsistent decision in the same proceedings.
3. The court would also have stopped the merits application at the threshold under the guidance in Williams & Humbert. The issues were prolonged, fact-sensitive and legally uncertain, including shadow directorship, fraudulent trading, transactions intended to prejudice creditors, and proprietary claims. They were unsuitable for summary determination and the proceedings would proceed to trial in any event.
4. Contribution claim. The claim under section 1(1) of the Civil Liability (Contribution) Act 1978 was not struck out. Read as a whole, the pleading gave an intelligible basis for alleging liability to the Consortium Banks. Any deficiency was one of particularisation, for which further particulars could be sought.
5. Abuse challenge. The proceedings were not brought for an improper or collateral purpose and were not manifestly unfair. The claimants had viable causes of action of their own and a sustainable case concerning substantial inbound liabilities. The alleged bypassing of Indian liquidations concerned matters internal to those liquidations and did not amount to misuse of the English court’s process. Nor did alleged conflicts, funding arrangements, possible double recovery, or limitation advantages establish abuse.
6. The defendants’ applications were dismissed.

The judgment records earlier interlocutory decisions concerning worldwide freezing orders and forum non conveniens, including the November 2022 judgment and the order of 8 March 2023. The present court dismissed the strike-out and reverse-summary-judgment applications.