Prashant Hasmukh Manek & Ors. v 360 One Wam Limited & Ors.

On an application to set aside permission to serve proceedings out of the jurisdiction, the claimant need only show a realistic prospect of success. The court may determine a short applicable-law issue summarily, but should avoid doing so where the trial evidence may affect the analysis.

For limitation postponed by fraud or deliberate concealment, the relevant question is when the claimant knew, or could with reasonable diligence have discovered, the essential facts needed to plead each cause of action against each defendant. Public knowledge of an individual’s office is not necessarily enough to plead attribution or vicarious liability. The court must assess whether the alleged involvement of each defendant could reasonably have been discovered in time.

The claimants sought damages arising from the alleged fraudulent sale of their minority shareholding in an Indian company at a substantial undervalue. They had already brought related proceedings against other alleged participants. The new proceedings joined three further defendants and alleged deceit, intimidation, conspiracy and joint tortfeasance.

The defendants applied to set aside permission for service out of the jurisdiction. They argued that the claims were time-barred under Indian or English law and that the claimants had failed to make full and frank disclosure on the ex parte application. The central issues were whether the claims had a realistic prospect of success, which law governed the torts, whether limitation was postponed by fraud or concealment, and whether any non-disclosure was material.

1. The application was dismissed. The claimants had to show a realistic prospect of success on each claim against each defendant. The jurisdictional challenge therefore engaged a summary judgment standard, but the court should not finally determine a fact-sensitive issue where the trial evidence might affect the result.

2. There was a realistic prospect that English law governed the tort claims under Article 4 of Regulation No 864/2007. For Article 4(1), the relevant damage was not necessarily the technical registration of the shares in India. The claimants could argue that the irreversible commitment to the transactions occurred where they entered into the SPAs or handed over the shares. The key events in the alleged fraud occurred in England. Those events, the existing English proceedings and the overall centre of gravity gave the claimants a realistic prospect of establishing a manifestly closer connection with England under Article 4(3).

3. Under section 32 of the Limitation Act 1980, discovery concerned the essential facts without which each cause of action was incomplete. The inquiry was objective and concerned what a reasonably attentive claimant in the actual circumstances could and should have discovered. The claimant had to assess each cause of action against each defendant separately.

4. The November 2015 press reports triggered investigation, but it was realistically arguable that reasonable investigation before February 2016 would not have revealed the IIFL defendants’ concealed involvement through EMIF, or supplied a proper basis for attribution, vicarious liability, conspiracy or joint tortfeasance. The fact that individuals held offices in the defendants was not, by itself, a sufficient basis for pleading those claims.

5. Although intimidation was an overt tort, it was realistically arguable that the defendants’ concealed role in the transactions was a deliberately concealed fact relevant to their liability for the tort.

6. The alleged failures of full and frank disclosure were either immaterial, trivial or adequately addressed in the evidence. The materiality test was not met.

First instance decision. The judgment refers to related existing proceedings and to a Court of Appeal decision, [2021] EWCA Civ 264, concerning those proceedings.