Papiss Demba Cisse v Sandra Diene & Anor

The Henderson v Henderson abuse of process principle requires a broad, merits-based assessment of whether later proceedings misuse the court’s process. It should be applied cautiously where earlier proceedings were determined on pleadings without an evidential trial, particularly where the later claim raises wider issues of dishonesty or forgery.

A relationship of trust and confidence, together with a transaction calling for explanation, may establish presumed undue influence. An agent’s fiduciary status alone does not create that presumption. A fiduciary agent who controls a principal’s bank accounts must keep and produce accurate accounts and may be ordered to account on the footing of wilful default where there is a prima facie basis for unknown breaches.

The claimant, a professional footballer, engaged the second defendant to assist with his financial affairs, property acquisitions and bank accounts. The claimant was registered as proprietor of 3 Riverside Lodge and 16 Packsaddle Park. He alleged that documents relating to the latter property were forged and that a 2018 Declaration of Trust transferring beneficial ownership of both properties to the second defendant had been procured by undue influence.

Earlier possession proceedings concerning 16 Packsaddle Park had been dismissed after the County Court concluded, without hearing evidence, that the Declaration of Trust was binding because the claimant had not pleaded rescission or setting aside in his Particulars of Claim. The present proceedings concerned beneficial ownership, undue influence, abuse of process and the defendant’s liability to account for bank transactions and property rents.

1. The claim was not struck out as an abuse of process. Although the claimant could have challenged the Declaration of Trust in the earlier possession proceedings, the earlier case concerned only possession of 16 Packsaddle Park and had been decided on a preliminary pleading issue without an evidential determination. The present proceedings concerned both properties and serious allegations of forgery and dishonesty. The defendants had also failed to show unjust harassment or oppression and had waited until closing submissions to raise the point.

2. The claimant was the sole beneficial owner of 3 Riverside Lodge before the Declaration of Trust. There was no signed writing establishing an express trust under section 53(1)(b) of the Law of Property Act 1925, no sufficient contribution to the purchase price supporting a resulting or implied trust, and no evidential basis for a constructive trust.

3. The relevant documents for the acquisition of 16 Packsaddle Park, including the TR1, were forged. Nevertheless, registration vested the legal estate in the claimant under section 58(1) of the Land Registration Act 2002. The court did not determine the beneficial trusts affecting that property because no such issue was pleaded or argued.

4. The Declaration of Trust was set aside for presumed undue influence. The claimant had generally reposed trust and confidence in the defendant, but the agency relationship alone was insufficient. The transaction called for explanation because it transferred beneficial ownership of the claimant’s properties while leaving him subject to legal-owner liabilities and providing no substantial benefit. The presumption was not rebutted.

5. The Declaration of Trust was also liable to be set aside for actual undue influence. The defendant exploited his superior knowledge, language and financial proficiency, and misled the claimant about the document’s effect. The requirements identified in Bank of Credit and Commerce International SA v Aboody were satisfied. The claimant would not have signed the document without that influence.

6. The defendant was a fiduciary agent and owed duties of loyalty, including duties not to profit from the relationship, not to place his interests in conflict with his duty, and to account for money managed on the claimant’s behalf. The defendant’s failure to provide accounts, together with the prima facie irregularity of the transactions, justified an account of scheduled transactions and a wider account on the footing of wilful default.

7. The defendant had to account for the rents and profits of 3 Riverside Lodge because he obtained the opportunity to let the property through his fiduciary position and had no beneficial entitlement to it.

8. The Declaration of Trust was set aside. The claimant was declared sole beneficial owner of 3 Riverside Lodge. Accounts were ordered in respect of the specified bank transactions, other payments from the relevant accounts on the footing of wilful default, and the rents and profits of 3 Riverside Lodge. Further consequential matters and costs were reserved.

The judgment records earlier possession proceedings in the County Court at Manchester. HHJ Evans dismissed that claim on a preliminary pleading point without hearing evidence. Permission to appeal had been granted by Mr Justice Constable, but the appeal had not been heard. The present judgment declined to strike out the wider claim as an abuse of process.