Olympic Council of Asia v Novans Jets LLP & Ors

The court considered an application for committal for contempt against Novans Jets LLP (an LLP), Novans Investment Ltd and Mr July Gringuz for breaches of disclosure and information orders made after a judgment in favour of the claimant (the Olympic Council of Asia). The judge held that the October 2020 redraft of CPR Part 81 did not remove the pre-existing substantive law (the "Body Corporate Provision") permitting committal applications against natural persons who are the functional equivalent of directors or officers of a corporate respondent. He held that an LLP is a "body corporate" for these purposes and that the expression "director or other officer" should be given a functional meaning embracing de facto directors.

However, procedural requirements (notably the presence and form of penal notices attached to the orders) and the scope and purpose of the particular orders limited the relief available. The January trial disclosure order (which lacked a penal notice and was framed to assist adjudication) was not, in itself, the proper basis for committal. The April and May disclosure / information orders were capable of supporting committal, but the April Order did not include a penal notice in terms that clearly extended to Mr Gringuz and the court would not waive that defect; accordingly the claimant could not pursue a committal against Mr Gringuz under the Body Corporate Provision based on that order. The alternative criminal contempt route (Seaward jurisdiction) remained available but the evidence did not establish beyond reasonable doubt the necessary aiding, abetting or wilful interference, except that the judge considered that, had committal been procedurally available, he would have found that Mr Gringuz had deliberately withheld information as to the bank account(s) into which charter payments were made. The committal application against Investments was not determined because of pleading and factual difficulties and potential conflict with insolvency administration.

The Olympic Council of Asia obtained a judgment against Novans Jets LLP in January 2022 and directions for the assessment of a profit-share claim. Subsequent orders (a worldwide freezing order in March 2022 and follow-up information / disclosure orders in April and May 2022) required disclosure of flight logs, consolidated flight reports, proposed net profit margins and information about third-party charters and the parties to whom charter income had been paid. Those latter orders carried penal notices.

The claimant applied for committal of Novans Jets LLP, Novans Investment Ltd and Mr July Gringuz for contempt for failing to comply with the disclosure and information obligations. The issues the court framed and resolved included:

• Whether the post-October 2020 form of CPR Part 81 had removed or altered the pre-existing rule (the Body Corporate Provision) permitting committal of natural persons responsible for a corporate respondent's breach.
• Whether an English LLP is a "body corporate" for the purposes of that rule and who falls within the description "director or other officer".
• Whether committal could be pursued against Mr Gringuz for breaches of orders made against Novans Jets LLP, given the form and content of the penal notices attached to the relevant orders.
• Whether the evidence met the criminal standard (beyond reasonable doubt) required for committal, either under the Body Corporate Provision or under the common-law/Seaward test for third-party aiding or permitting breach.
• Whether the committal application against Investments could be determined in the claimant's favour given evidential and procedural shortcomings.

The judge concluded that the October 2020 re-drafting of CPR Part 81 did not effect a substantive removal of the Body Corporate Provision; the CPR expressly preserved the substantive law of contempt and other CPR provisions (and retained ancillary enforcement rules such as sequestration) support the continued availability of committal applications against those who are, in functional terms, the directors or officers of corporate respondents. An LLP is a "body corporate" and the phrase "director or other officer" should be read functionally to include de facto directors or functional equivalents.

Procedurally, the court emphasised the importance of the penal notice. The January Order (a disclosure order for adjudicative purposes) lacked a penal notice and the judge would not convert that order into a coercive committal order by waiving the notice requirement. The April Order and May Order were properly "badged" as coercive orders capable of supporting committal, but the April Order had expressly omitted naming Mr Gringuz in its penal notice after inter partes argument and the judge concluded he could not safely waive that omission; that meant the claimant could not rely on the Body Corporate Provision to commit Mr Gringuz under those orders. The alternative route—criminal contempt for knowingly assisting or permitting a breach (Seaward jurisdiction)—remained available, and the April/May Orders were sufficiently prominent to attract penal notice language addressing third-party facilitation. On the facts, however, the judge was unable to find to the criminal standard that Mr Gringuz procured or wilfully assisted the breaches save that, as a matter of inference, he considered that Mr Gringuz had withheld information about the bank account(s) receiving charter hire and invoices and, had the procedural obstacles not existed, he would have found contempt on that issue.

The committal application against Investments was not determined because the particulars of contempt were addressed only to Jets, the factual premise that Investments owned the aircraft was contested and the practical consequences of sequestration could conflict with insolvency and enforcement processes. The judge encouraged provision of the withheld bank/account information and indicated that a fresh application could be sought if that was not provided.

The court declined to make committal orders in the current applications. It held that (i) the Body Corporate Provision survives the redraft of CPR Part 81 and applies to LLPs and to de facto directors; (ii) the January disclosure order without a penal notice could not be converted into a committal basis; (iii) the April and May orders were capable of supporting committal but, because of the way penal notices were framed and the circumstances at the inter partes hearing, the court would not waive the absence of a clear penal notice in respect of Mr Gringuz and therefore dismissed the claimant's committal case under the Body Corporate Provision; (iv) the alternative criminal contempt (Seaward) route remained open but the evidence did not meet the criminal standard on most allegations; and (v) the committal application against Investments was not determined for pleading, factual and practical reasons. The court gave detailed reasoning on the law of contempt, the role and form of penal notices, the functional approach to officers of corporate bodies and the evidential threshold for criminal contempt.