Camran Mirza & Ors v CMS Cameron McKenna Mabarro Olswang LLP

Applications concerning declarations require the court to assess both the underlying claim and whether declarations would serve a useful purpose. A declaration concerning an alleged, remedied past breach will generally lack sufficient utility where no loss, continuing trust, future risk or real present dispute remains.

On summary judgment, the court may evaluate clear contemporaneous evidence and reject allegations that are obviously wrong or contradictory, while avoiding a mini-trial. A proposed amendment must have a realistic, coherent and properly evidenced prospect of success. The court may refuse proceedings which would waste court and party resources or pursue declarations whose costs and consequences are disproportionate.

The claimants sought declarations concerning £50,000 paid to their former solicitors for criminal counsel’s fees. They later applied to add a claim concerning £129,000 said to have been paid for civil counsel’s fees.

The defendant applied to strike out the claim or obtain summary judgment. The claimants also applied for summary judgment. The central issues were whether either payment created a specific-purpose trust, whether the monies had been misapplied, whether any breach had been remedied, and whether the proposed declarations had sufficient utility and purpose to justify continuation of the proceedings.

1. Disposition. The amendment application was refused. The defendant’s application for summary judgment succeeded. The claimants’ summary judgment application was dismissed.
2. The court applied the summary judgment test in Easyair Ltd (t/a Openair) v Opal Telecom Ltd, permitting careful evaluation of contemporaneous documents but not a mini-trial. A proposed amendment had to be arguable, coherent, properly particularised and supported by evidence establishing a factual basis.
3. Declarations involved two stages. First, the claimant had to establish the relevant rights, facts or principles and a realistic prospect of success. Secondly, the court had to decide whether it should exercise its discretion to grant the declaration in the terms sought. Relevant considerations included justice to both parties, useful purpose, a real and present dispute, proportionality, court resources and the overriding objective.
4. The £50,000 criminal payment had been used for the purpose for which it was provided. CMS had not misappropriated or dissipated it, had not exercised a lien over it, and had proposed payment of outstanding counsel’s fees before transferring the balance. There was therefore no real prospect of success and no useful declaration to be made.
5. The £129,000 civil payment might, on the evidence then available, arguably have involved a specific-purpose trust. That issue could not finally be determined without a trial. However, any breach had been remedied when a different £129,000 was used to pay the relevant counsel, and no loss or damages were claimed. The proposed declarations consequently had no continuing utility or purpose.
6. The claimants’ failure to engage properly in pre-action conduct, the lateness and changing nature of the allegations, and the availability of more appropriate procedures for costs complaints reinforced the conclusion that continuation would be disproportionate and contrary to the overriding objective.