Gavin Paul Carter & Anor v Terri Ann Davies & Ors

A claim to set aside an earlier judgment for fraud is a separate cause of action. A bankrupt lacks standing where the claim has vested in the trustee, while a non-party requires a sufficient personal interest connected with the impugned judgment. A later-acquired property interest affected through bankruptcy and enforcement is insufficient. The court applied the fraud test of conscious and deliberate dishonesty, materiality and causation, assessed against the original decision. It refused amendment, left the discontinuance in place, and made an extended civil restraint order after repeated claims and applications bound to fail.

The claimants sought to set aside a 2021 judgment for defamation and harassment on the basis that it had been obtained by fraud. The first claimant was bankrupt and the second claimant claimed a later-acquired interest in property affected by enforcement of the bankruptcy. The claimants also sought to amend their Particulars of Claim.

The first and second defendants applied to strike out, obtain totally-without-merit certification and secure a civil restraint order. The professional defendants applied to set aside a notice of discontinuance, strike out, obtain certification and secure a restraint order. The central issues were standing, the legal sufficiency of the fraud allegations, amendment, discontinuance and the appropriate restraint order.

1. Disposition. The claim against the first and second defendants was struck out. The application to amend was dismissed and both were certified totally without merit. The notice of discontinuance in favour of the professional defendants was not set aside. An extended civil restraint order was made.
2. Standing and relief. A fraud-based challenge to an earlier judgment is an independent cause of action. It seeks to remove the earlier judgment and reactivate the original dispute for retrial; it does not determine the underlying liability or damages. The analysis in Takhar v Gracefield Developments Ltd [2019] UKSC 13 supported the possibility of a non-party claim where there was a sufficient personal interest. The first claimant’s claim had vested in the trustees under the Insolvency Act 1986, so he lacked standing under the principle applied in Heath v Tang [1993] 1 WLR 1421. The second claimant acquired her alleged property interest after the impugned judgment, through the later bankruptcy and enforcement process, which was insufficient.
3. Fraud and amendment. The court applied the three-part test stated in Royal Bank of Scotland Plc v Highland Partners [2013] EWCA Civ 328: conscious and deliberate dishonesty, materiality and causation, assessed by reference to the original decision rather than a possible retrial. The allegations did not satisfy those requirements. The earlier judgment had not determined the underlying contractual dispute, and the new material could not have changed the approach to the issues decided. The requirement for particularity in serious fraud allegations, illustrated by Three Rivers District Council v Governor and Company of the Bank of England (No 3) [2001] UKHL 16, did not assist the claim. Amendment was refused under the Civil Procedure Rules 1998 because the proposed case had no real prospect of success.
4. Discontinuance. The discretion under CPR r.38.4 was governed by the overriding objective. Abuse of process was a powerful, but neither necessary nor exclusive, consideration. Applying Excalibur & Keswick Groundworks Ltd v McDonald [2023] 1 W.L.R., the court held that reinstating the discontinued claim merely to strike it out would serve no practical purpose. Active case management also justified addressing the related allegation against the trustees, for which there was no realistic basis.
5. Civil restraint order. Totally without merit meant bound to fail, applying R. (Grace) v Secretary of State for the Home Department [2014] EWCA Civ 1091. The framework in Achille v. Calcutt & Carrington (No. 3) [2024] EWHC 2169, including the distinction drawn in R (Kumar) v. Secretary of State for Constitutional Affairs [2006] EWCA Civ 990 and the persistence threshold in Sartipy v. Tigris Industries Inc. [2019] EWCA Civ 225, was applied. At least three totally without merit claims or applications had been established. The focused nature of the litigation justified an extended rather than a general order, and the order was necessary and proportionate.

This was a first-instance decision. The judgment records earlier litigation, including the 2021 defamation and harassment judgment, the first claimant’s bankruptcy, unsuccessful challenges concerning the bankruptcy and property, and prior applications and an appeal certified as totally without merit. No appeal from the present decision is stated.