Bashar Bin Mahmood v KPMG LLP & Anor

A claimant cannot relitigate a claim after an earlier strike-out which involved a substantive determination that the pleaded case disclosed no reasonable grounds, particularly where judgment was entered for the defendants. Cause of action estoppel, issue estoppel and the Henderson principle may therefore bar a replicated claim and closely related additional claims.

Alternatively, where the earlier claim was struck out as an abuse without substantive adjudication, Securum requires a special reason before a second claim may proceed. A bankrupt claimant who knowingly sues on a cause of action vested in the trustee in bankruptcy acts abusively. Regularisation remains discretionary, but is unavailable where the claimant knowingly lacked title and the trustee has not assigned the claim.

The claimant brought proceedings alleging professional negligence and misconduct by the defendants in connection with administrations conducted between 2008 and 2010. The claim substantially replicated an earlier claim against the same defendants, which had been struck out by District Judge Greenidge on 10 July 2023 under CPR 3.4(2)(a) and (b), with judgment entered for the defendants. Permission to appeal was refused.

The claimant issued the present proceedings before his oral permission application in the earlier claim was determined. The defendants sought strike-out for abuse of process and summary judgment. The central issues were whether the earlier decision was a substantive adjudication engaging estoppel principles, whether the Securum principles applied alternatively, and whether the claimant had standing despite his bankruptcy.

1. Strike-out and estoppel. The earlier decision was a substantive adjudication. District Judge Greenidge had considered extensive material, concluded that the claim disclosed no reasonable grounds, and entered judgment for the defendants. A decision under CPR 3.4(2)(a), even where the pleading is also described as vague or incoherent under CPR 3.4(2)(b), may determine the substantive merits. The judgment therefore engaged cause of action estoppel, issue estoppel and the Henderson principle (paras [30]-[37]).
2. The present claim substantially repeated the earlier claim. The factual allegations repeated in the new proceedings were subject to issue estoppel. Additional allegations concerning eviction and Construction Link Ltd either arose from the same circumstances or were so closely related that they should have been raised earlier. They were consequently barred by issue estoppel or the Henderson principle (paras [38]-[39]).
3. Alternative Securum analysis. If the earlier strike-out had not been a substantive adjudication, a special reason would nevertheless have been required before the new claim could proceed. The absence of such a reason, the earlier findings that the claim and appeal application were totally without merit, the unpaid costs order, the failure to explain the difference between the claims, and the substantial duplication all strongly favoured strike-out (paras [40]-[48]).
4. Concealment. The test for deliberate concealment under section 32(1)(b) of the Limitation Act 1980 requires a fact relevant to the right of action, concealment by the defendant, and an intention to conceal it. The claimant produced no evidence of positive concealment, withholding of relevant information, or an intention to conceal. The alleged lack of disclosure did not justify continuation of the claim (paras [43]-[46]).
5. Bankruptcy and standing. Where a bankrupt claimant knows that title to a cause of action is vested in the trustee in bankruptcy, commencing or pursuing the claim is improper and abusive. Although an action may in an appropriate case be regularised by joinder of the trustee or assignment, that discretion did not assist a claimant with actual knowledge of his lack of title. The claim was also struck out on this independent basis because the Official Receiver had not agreed to joinder or assignment (paras [51]-[62]).
6. The claim was struck out in its entirety as an abuse of process and was found to be totally without merit under CPR 3.4(6). The question of a civil restraint order was reserved for consequential submissions (paras [63]-[66]).

First instance decision. The judgment records that the earlier claim was struck out by District Judge Greenidge on 10 July 2023. Permission to appeal was refused on the papers by HHJ Saggerson on 27 October 2023 and after an oral renewal by HHJ Bloom on 9 May 2024.