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You are here: BAILII >> Databases >> England and Wales High Court (Commercial Court) Decisions >> Goyal& Anor v BGF Investment Management Ltd & Ors [2023] EWHC 1283 (Comm) (26 May 2023) URL: http://www.bailii.org/ew/cases/EWHC/Comm/2023/1283.html Cite as: [2023] EWHC 1283 (Comm) |
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BUSINESS AND PROPERTY COURTS OF
ENGLAND AND WALES
COMMERCIAL COURT (KBD)
Strand, London, WC2A 2LL |
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B e f o r e :
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(1) MANISH GOYAL (2) JYOTI GOYAL |
Claimants |
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- and – |
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(1) BGF INVESTMENT MANAGEMENT LIMITED (2) BGF INVESTMENTS LP (3) BGF GROUP PLC (4) ALEXANDER NEVILLE SNODGRASS (5) ARUN BALASUBRAMANIAM |
Defendants |
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David Mumford KC and Ryan James Turner (instructed by Macfarlanes LLP) for the First to Fourth Defendants
Lesley Anderson KC and Paul Strelitz (instructed by CMS Cameron Mckenna Nabarro Olswang LLP) for the Fifth Defendant
Hearing dates: 15-17, 20-23, 27-31 March, 3-5 April 2023
Further Submissions: 11, 12 April 2023
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Crown Copyright ©
The Hon. Mr Justice Butcher:
(1) Whether the Claimants should pay the Defendants' costs on an indemnity basis (at least from 18 April 2022), as the Defendants contend, or on a standard basis, as the Claimants contend.
(2) The amount of any payment on account.
(3) The time within which such a payment on account should be made.
"(8) The following circumstances take a case out of the norm and justify an order for indemnity costs, particularly when taken in combination with the fact that a claimant has discontinued only at a very late stage in proceedings:
(a) where the claimant advances and aggressively pursues serious and wide-ranging allegations of dishonesty or impropriety over an extended period of time;
(b) where the claimant advances and aggressively pursues such allegations, despite the lack of any foundation in the documentary evidence for those allegations, and maintains the allegations, without apology, to the bitter end;
…
(e) where the claimant pursues a claim which is, to put it most charitably, thin and, in some respects, far-fetched;
(f) where the claimant pursues a claim which is irreconcilable with the contemporaneous documents …"
"Various decided cases illustrate the sort of situation in which an order for an assessment on the indemnity basis may be made although, in my view, they do no more than this. Thus, as Mr Forshaw [counsel for the claiming party] points out, examples of where such orders have been made include:
(i) where a claim is dishonest and/or is dishonestly maintained, as I have pointed out;
(ii) where a claim is "speculative, weak, opportunistic or thin": see Three Rivers District Council v The Governor of the Bank of England [2006] EWHC 816 (Comm) at para 25(5);
(iii) where a claim is pursued for reasons or purposes unconnected with any real belief in their merit. As Coulson LJ put it in Lejonvarn v Burgess [2020] EWCA Civ 114 at para 66:
"An irrational desire for punishment unlinked to the merits of the claims themselves is precisely the sort of conduct which the court is likely to conclude is out of the norm."
(iv) where allegations of fraud or dishonesty are made which have failed: see Clutterbuck v HSBC plc [2015] EWHC 3233 (Ch) at paras 16 and 7. In relation to this authority, Mr Forshaw came close to submitting that as a matter of course, if allegations of fraud or dishonesty have failed, costs must be ordered to be assessed on an indemnity basis. Insofar as that was his submission, I do not agree. There is, in my view, no such rule in the context of applications for indemnity costs although, as I have said, where such allegations are made and fail, that may be a reason for making such orders;
(v) where an overly aggressive and unreasonable approach to correspondence between solicitors has been adopted: see Excalibur Ventures LLC v Texas Keystone Inc [2013] EWHC 4278 (Comm) at para 48."
"Where one is dealing with the losing party's conduct, the minimum nature of that conduct required to engage the court's discretion would seem, except in very rare cases, to be a significant level of unreasonableness or otherwise inappropriate conduct in its widest sense in relation to that party's pre-litigation dealings with the winning party or in relation to the commencement or conduct of the litigation itself."
(1) That Mr Goyal put pressure on at least the First to Fourth Defendants to settle by advancing his case through social media.
(2) That Mr Goyal sought to generate further pressure on the First to Fourth Defendants by drawing in the parent company, BGF Group plc, as a defendant.
(3) The Claimants pursued a case which they must have known would fail: in particular they must have known that it would fail on grounds of lack of inducement and causation.
(4) There were two aspects of the Claimants' case which were particularly speculative: (i) Mrs Goyal's claim to beneficial ownership of shares held by Mr Bhattacharya and Mr Agarwal; and (ii) the claim to conspiracy and common design liability.
(5) What was alleged was a claim in fraud, with serious allegations against professional men, which failed.
(6) The Claimants had failed to plead their case in a clear and conventional way.
(7) The Claimants' case on quantum was unjustifiably complex. The counterfactuals were ill thought out, and in large part hopeless.
(8) A considerable proportion of the costs could have been avoided. The Defendants made drop hands offers on 18 January 2023, which were not accepted.