Henderson & Jones Limited v Tysers Insurance Brokers Limited

Strike out and summary judgment are exceptional remedies. A claim should proceed where pleaded contractual interpretation, loss, causation or assignment issues are reasonably arguable and require evidence or trial. Abuse based on approbation and reprobation is rare and generally requires an extreme, deliberate strategy of inconsistent pleading. Amendments should be assessed by distinguishing clarification, withdrawal and genuinely new claims. A bare cause of action may be assigned where the assignee has a legitimate interest, assessed by the totality of the transaction and its circumstances. Rights to sue for damages arising after performance of a personal-services contract are assignable absent an express restriction. A whole legal assignment remains compliant with section 136 of the Law of Property Act 1925.

The claimant, an apparent assignee of claims against an insurance broker, alleged that the defendant had failed to procure insurance on a like-for-like basis. The underlying insured property was damaged by a nearby fire, and insurers rejected or compromised claims for lost rent.

The defendant applied to strike out the claim or obtain summary judgment. It challenged the coherence and proof of the damages case, the verification of a schedule of loss, the proposed amendments, and the validity of the assignments. The claimant sought permission to amend its Particulars of Claim, including its case on loss and estoppel. The central issues were whether the pleaded claims had a real prospect of success, whether the amendments should be allowed, and whether the assignments were invalid as champertous, incapable of assignment, or merely equitable.

The claimant’s application for permission to amend was granted. The defendant’s applications for strike out and summary judgment were refused.

1. Strike out and summary judgment. Under CPR 3.4(2), strike out is confined to cases disclosing no reasonable grounds, abuse of process or an impediment to the just disposal of proceedings. Under CPR 24.3, summary judgment requires no real prospect of success and no other compelling reason for trial. Strike out considers the pleading; summary judgment may consider evidence.
2. Verification and abuse. The original statement of truth was non-compliant, but an updated statement signed by a company director substantially cured the defect. The schedule therefore remained effective under CPR 22.2. Abuse based on approbation and reprobation is likely to be very rare. It requires an extreme case, such as a deliberate strategy to preserve inconsistent cases against different defendants. This claim did not meet that high threshold.
3. Amendments. The court applied the questions identified in Su-Ling v Goldman Sachs and Scott v Singh. Amendments clarifying the existing case or withdrawing an alternative claim were allowed. The open-ended indemnity-period and related loss amendments were a wholesale change of case, requiring heightened scrutiny, but they were arguable and could not be rejected summarily. Contractual interpretation, including the significance of commercial common sense, required consideration of the words, context and potentially evidence. The contractual exclusion for indirect or consequential loss also required trial.
4. Assignment. Claims held by an administrator as company property could be assigned without offending public policy. The claimant had a sufficient legitimate interest in the assigned claims because its claims supported and enlarged claims lawfully acquired from Artisan. Considering the transaction as a whole, the assignment did not tend towards corruption of public justice.
5. The personal-services character of the brokerage contract did not prevent assignment of the post-performance right to sue for damages. That right did not depend on the broker’s skill, judgment or other qualities. The assignment transferred the whole claim and was a legal assignment complying with section 136 of the Law of Property Act 1925; sharing litigation proceeds did not alter that conclusion.