JDK Holdings Corp v Marc Bourgade & Anor

Permission to amend a statement of case is discretionary. The merits threshold is relatively low: the proposed claim need only be arguable, coherent, properly particularised, supported by evidence and not fanciful. At this stage the court must avoid conducting a mini-trial or resolving competing factual evidence. A late amendment requires a balance between prejudice to the applicant and respondent, with lateness assessed in context. A statement of case need not be elegant or plead every evidential detail, but it must enable the opposing party to understand the case it must meet. Where an earlier pleading is vague and incoherent, the court may strike it out for disclosing no reasonable grounds, while permitting a materially improved pleading to proceed. Costs may properly reflect repeated defective amendments and delay.

The claimant sought specific performance, declarations and damages arising from an alleged joint venture concerning the ownership and operation of Aeroitalia SRL. It alleged that Mr Bourgade held shares through Asluma on trust and had granted an option enabling the claimant to acquire 95% of Asluma.

The defendants applied to strike out the original particulars of claim. The claimant made several unsuccessful amendment applications before advancing a final amended pleading. The central issues were whether the final pleading met the merits test for amendment, whether the earlier pleading should be struck out, whether an alleged October 2023 meeting raised a without-prejudice issue suitable for determination at this stage, and the consequential costs.

1. Final amendment allowed. The Final Amended Particulars of Claim set out a coherent cause of action, identified the alleged terms and chronology of the joint venture, and was supported by witness evidence and some documentary material. The claim was therefore not fanciful and satisfied the low merits threshold.
2. The court must not conduct a mini-trial on an amendment application. Competing accounts of oral discussions, the meaning of documents and the alleged sham consultancy agreements were matters for trial. The claimant did not have to establish that its case would ultimately succeed.
3. A statement of case must be comprehensible and sufficiently particularised to allow the opposing party to know the case it must meet. Elegance is unnecessary, and not every fact or item of evidence must be pleaded. The court nevertheless required further signposting linking the pleaded events, contractual terms and performance allegations.
4. Lateness was relevant but was assessed in context. The claim remained at an early procedural stage, the delay largely arose from the amendment and strike-out applications, and previous adverse costs orders and increased security reduced, though did not eliminate, prejudice to the defendant.
5. The original particulars of claim were vague and incoherent, failed to identify adequately the terms, formation and timing of the alleged joint venture, and disclosed no reasonable grounds for bringing the claim in that form. The relevant paragraphs were struck out under CPR rule 3.4(2)(a). The court declined to strike out the entire claim as an abuse of process because the final pleading was sufficiently coherent.
6. The alleged without-prejudice status of the October 2023 meeting was not determined at this stage. The issue involved an objective assessment and could be considered by the trial judge, including any question concerning the iniquity exception.
7. The claimant was ordered to pay the defendant’s costs of the final amendment application, the first strike-out application and the second strike-out application. The costs were directed to detailed assessment, with interim payments on account of £12,000, £25,000, £15,000 and £75,000 respectively.