Your Lawyers Limited v Capital Interchange Limited & Anor

Applications to strike out or obtain summary judgment should be determined with care where the claims raise arguable issues of fact or developing law. The court should not conduct a mini-trial or decide disputed factual questions summarily.

A later claim against a different defendant is not ordinarily abusive merely because related issues were litigated previously. The court must make a broad, merits-based assessment of oppression, unfairness, misuse of process and the public interest in finality and efficient litigation. An issue estoppel requires sufficient identity or privity of interest, assessed by reference to the new party’s interest, relationship with the original party and the justice of binding the new party.

The claimant brought claims against a litigation-funding broker and a litigation funder arising from the disclosure and alleged use of confidential material concerning a proposed Volkswagen emissions group action.

The applications followed earlier proceedings between the claimant and Harcus Sinclair. In those proceedings the Court of Appeal construed a non-compete provision in a non-disclosure agreement, and the Supreme Court upheld its enforceability. The claimant’s present claims included breach of contract, breach of confidence, unjust enrichment and unlawful means conspiracy.

The defendants sought strike out or summary judgment, relying on the earlier judgments, alleged lack of loss, absence of intention to injure, issue estoppel and abuse of process.

1. Applications dismissed. The claims against both defendants disclosed arguable causes of action. The claimant was required to provide further particulars of confidential information relied on against the funder.
2. The contractual issue in the present claim was materially different from the issue decided in the earlier proceedings. Those proceedings concerned the scope of the non-compete restriction imposed on Harcus Sinclair itself. The present issue concerned whether the broker had to ensure that a third-party funder was subject to equivalent confidentiality and non-compete obligations. The relevant passage in the Court of Appeal judgment was arguably obiter and, in any event, the agreements and factual matrices were not identical.
3. The earlier findings that confidential information had not been used to formulate the group litigation did not determine the present allegation that the funder used the claimant’s commercial insight in deciding whether to fund the litigation. Loss and causation therefore remained triable.
4. There was no issue estoppel against the funder. It had a commercial relationship with Harcus Sinclair and one employee had given evidence, but it had not been a party that allowed Harcus Sinclair to fight its battle. The requisite privity of interest was absent. Issue estoppels must also be mutual.
5. The unlawful means conspiracy claim raised triable issues as to combination, unlawful means, intention to injure and loss. Knowledge that the means were unlawful was not required. A positive belief in facts which, if true, would make the conduct lawful might provide a defence, but the evidence suggested assumption rather than a sufficiently established positive belief.
6. The later proceedings were not abusive. The unusual, expedited procedure in the earlier litigation made it impracticable to formulate claims against third parties. The absence of an earlier Aldi warning was not culpable and caused no demonstrated prejudice. Different evidence would be available at trial, and the present proceedings were not a collateral attack or oppressive relitigation.
7. The parties were directed to consider appropriate directions concerning further particulars and potentially overlapping issues of loss and quantum.

This was a first-instance decision on applications for strike out and summary judgment. The judgment records earlier proceedings between the claimant and Harcus Sinclair, including a Court of Appeal judgment reported at [2019] 4 WLR 81 and a Supreme Court judgment reported at [2022] AC 1271. Those decisions were not under appeal in the present proceedings.