Michael Wilson & Partners, Limited v John Forster Emmott

The court has power to stay proceedings as a case-management measure under its inherent jurisdiction and Civil Procedure Rules 1998, r 3.1(2)(f). A stay is exceptional because it interferes with access to the court, but may be justified where parallel litigation is likely to determine a common issue finally, avoid duplication, reduce costs and preserve proportionate use of public resources. The fact that the other proceedings are abroad is not decisive where their judgment may create an issue estoppel between the same parties. A stay to control abusive conduct is distinct: the civil restraint order regime is ordinarily the proportionate mechanism. On the unusual facts, all related Commercial Court proceedings were stayed until final judgment in the foreign proceedings, subject to one specified exception.

Michael Wilson & Partners, Limited and John Forster Emmott were involved in numerous related proceedings in the Commercial Court. The claimant was also pursuing a substantial claim against the defendant in New South Wales concerning the alleged Temujin Partnership. That claim was listed for trial and was expected to determine finally whether the defendant had been a partner and liable to account.

The defendant sought a case-management stay of the English proceedings until final judgment in New South Wales. The claimant opposed the stay, contending that the court lacked jurisdiction and that its English claims and applications should proceed. The central issues were whether the court had power to impose the stay, whether the foreign proceedings justified it on proportionality grounds, and whether the alleged abusive conduct independently warranted a stay.

1. Jurisdiction. The court’s power to stay proceedings derived from its inherent power to control proceedings, preserved by s 49(3) of the Senior Courts Act 1981, and independently from Civil Procedure Rules 1998, r 3.1(2)(f). The power was apparently unfettered but draconian and should generally be exercised only in exceptional circumstances. The starting point was the right of a person with a bona fide claim to untrammelled access to a court of first instance, subject to recognised exceptions such as abuse of process.
2. Case-management principles. A stay could be imposed to achieve case-management objectives where no less intrusive power would assist, including the overriding objective of dealing with cases justly and at proportionate cost and allotting an appropriate share of court resources. Stays in cases involving related litigation were rare and compelling remedies, but the relevant assessment was highly fact-sensitive.
3. Foreign proceedings and duplication. The New South Wales claim was likely to determine finally, between the same parties, the disputed Temujin Partnership issue. A final foreign judgment could create an issue estoppel as a matter of English law. Resolving that issue abroad would simplify the English litigation and avoid repeated determination of the same question. A substantial judgment in favour of the claimant would also likely eliminate or render academic extensive disputes concerning set-off, enforcement and costs.
4. Disposition. The extraordinary history, scale and continuing consumption of judicial resources made a stay proportionate despite its exceptional nature. All the Commercial Court proceedings were stayed until final judgment in the New South Wales claim, except for the self-contained application dated 20 October 2023 listed for 1 November 2024. The parties had liberty to apply to lift the stay.
5. Abuse allegations. The court did not decide whether the proceedings should be stayed for abusive conduct. Such a stay had not been sought on that basis and was not the basis of the order. The civil restraint order regime was the more proportionate mechanism for controlling vexatious or totally meritless litigation; a general stay might be considered only if that regime proved inadequate.

Not stated in the judgment.