Harrington & Charles Trading Company Limited (in liquidation) & Ors v Jatin Rajnikant Mehta & Ors

Requests for further information must concern a matter in dispute and be concise, strictly confined, reasonably necessary and proportionate. The court’s discretion is exercised consistently with the overriding objective and good case management. Delay, prior scrutiny of the pleadings, an extensive defence, and the availability of disclosure may make a request premature and disproportionate.

Further disclosure to police a freezing order is a protective jurisdiction. It may be ordered where there are grounds to believe that there is a real risk of breach or undisclosed assets, and where disclosure has practical utility or is just and convenient to make the order effective. The order must be carefully calibrated and no wider than reasonably necessary. Confidentiality and foreign-law concerns may be relevant but are not necessarily a bar.

The claimants brought consolidated fraud and insolvency-related proceedings concerning an alleged multi-jurisdictional fraud. The active defendants applied under Civil Procedure Rules 1998 Part 18 for further information about the pleaded case. The claimants also sought disclosure and information to police a worldwide freezing order, particularly concerning receivables, the funding of Indian proceedings, a third-party funding agreement and payments routed through an intermediary.

The court considered whether the requests were reasonably necessary and proportionate before disclosure, and whether there was credible material establishing a real risk that the freezing order was being breached or that undisclosed assets were being used.

1. RFI application dismissed. Under CPR 18.1 and Practice Direction 18, a request must relate to a matter in dispute and be concise, strictly confined, reasonably necessary and proportionate. The power is discretionary and must be exercised consistently with the overriding objective and good case management.
2. The requests were made after substantial delay, following detailed scrutiny of the claim, consent to the consolidated particulars of claim, service of a comprehensive defence and counterclaim, and the fixing of a disclosure timetable. Much of the information sought was evidential, premature, or likely to emerge from disclosure. The requests also risked creating parallel, piecemeal workstreams and unnecessary costs. They therefore fell outside the proper scope of Part 18.
3. Limited disclosure ordered to police the freezing order. The court’s jurisdiction to require information about assets under CPR 25.1(1)(g) is essentially protective. It may be exercised where there are grounds to believe that there is a real risk that the order is being breached or that further assets may fall within its scope. The court must be satisfied that disclosure has practical utility, is necessary or just and convenient, and is proportionate.
4. The unexplained third-party funding arrangements, the use of an intermediary, inconsistent explanations, inadequate evidence and apparent discrepancies in asset disclosure established the required real risk. The fact that payments were made by an alleged third-party funder did not by itself remove them from scrutiny, particularly given the extended definition of assets in the freezing order.
5. The claimants’ wide-ranging requests were substantially excessive. The court ordered a calibrated disclosure process: an affidavit explaining the funding of the Indian proceedings; disclosure of the third-party funding agreement and other funding agreements, subject to a confidentiality club and limited redactions; explanations and ledgers from the Indian lawyers; and limited further information concerning payments routed through the intermediary. Broader trawling disclosure was refused.
6. Confidentiality, commercial sensitivity and possible foreign-law consequences were matters to weigh in the discretion. They did not constitute an absolute bar to disclosure, although appropriate safeguards and redactions could be used.