William Andrew Tinkler v Esken Limited & Ors

A party may be bound by a clear admission that pursuing a claim would constitute an abuse of process or that the claim is bound to fail. Withdrawal of such an admission requires application of the factors in CPR Part 14.5, including new evidence, conduct, prejudice, the stage of proceedings, merits and the interests of justice.

Abuse of process may arise from collateral attack on earlier findings or from pursuing matters which could and should have been raised previously. In complex commercial litigation, the Aldi guidelines require a party wishing to reserve related proceedings to raise the matter with the court. Strike-out is a draconian remedy, but is appropriate where the claim is abusive or has no real prospect of success.

The claimant brought a claim for unlawful means conspiracy against Esken Limited and three individuals. The claim was stayed pending determination of an earlier fraud claim seeking to set aside a judgment concerning the claimant’s dismissal as an employee and removal as a director.

The fraud claim was dismissed, the appeal was dismissed by the Court of Appeal, and the Supreme Court refused permission to appeal. The defendants then applied to strike out the conspiracy claim and to be released from preservation undertakings. The claimant resisted, sought to pursue an amended shareholder-based case, and contended that the conspiracy claim was broader than the fraud claim.

The issues were whether the claimant was bound by his earlier admission, whether permission should be given to withdraw it, and, alternatively, whether the original or amended claim constituted an abuse of process or had no real prospect of success.

1. The court refused permission to withdraw the claimant’s clear and unequivocal admission that pursuing the conspiracy claim would be an abuse of process if the fraud claim failed and the earlier judgment remained binding. The admission was made repeatedly in witness statements, written submissions and oral submissions. Under CPR Part 14.5, the claimant identified no new evidence unavailable when the admission was made, delayed materially before seeking withdrawal, and had not complied with the Aldi guidelines.

2. The defendants would suffer significant prejudice from withdrawal. The related claims involved complex commercial multi-party litigation, and permitting withdrawal would undermine finality, duplicate proceedings and impede recovery of outstanding costs. The interests of the administration of justice also weighed decisively against withdrawal.

3. Alternatively, the claim was struck out under CPR Part 3.4. The proposed issues concerning disclosure failures, alleged concealment, the Takeover Panel submissions, the EBT and the AGM either sought to relitigate findings already made in the fraud proceedings or amounted to Henderson v Henderson abuse. The claimant had access to the relevant material and could and should have raised the allegations earlier.

4. The amended shareholder-based formulation did not avoid the abuse. It substantially repeated the case advanced in the earlier proceedings, including allegations concerning Project Shelley, the proper purpose of directors’ powers and the AGM. It therefore amounted to a collateral attack on the earlier judgment. In any event, the claimant failed to show a real prospect of establishing an actionable conspiracy, causation or participation by Mr Soanes.

5. The court accepted, without deciding, that directors who breached section 171 of the Companies Act 2006 and combined with solicitors to destroy or suppress evidence might be liable for unlawful means conspiracy.

6. The conspiracy claim was dismissed in its entirety. The claimant was ordered to pay the costs of the claim, and the three individual defendants were released from their undertakings under the Preservation Order.

• High Court (ChD): The fraud claim was dismissed at [2022] EWHC 1375 (Ch), and consequential applications were determined at [2022] EWHC 1802 (Ch).
• Court of Appeal: The appeal was dismissed at [2023] EWCA Civ 655.
• Supreme Court: Permission to appeal was refused on 21 November 2023.
• High Court (Business List): The conspiracy claim was struck out and dismissed by the present judgment.