Home Information Cases Zia Shalimoun, Infina Fund Ltd v Mining Technologies International Inc (2011)

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Zia Shalimoun, Infina Fund Ltd v Mining Technologies International Inc (2011)

Summary

It was not an abuse of process for a company to rely in Canadian proceedings on documents disclosed pursuant to Bankers Trust orders made in the United Kingdom where it was not obvious at the time that proceedings would be commenced in Canada. Where the company had applied for a Bankers Trust order on the express basis that proceedings were likely, the court in making the order had implicitly given permission to use the documents in those proceedings.

Facts

The applicants (X) applied to set aside Bankers Trust orders obtained by the respondent company (M), and sought an injunction restraining M from using documents obtained as a result of those orders in Canadian proceedings. M had sought third-party financing, and had spoken to someone (K) who advised that an investment could be traded in the money markets for a return of five times M's original investment. On that advice, M transferred $2 million into X's bank account, which was subsequently transferred to an unknown location. M applied for a Bankers Trust order against the bank holding X's account in order to obtain information about the transfer. The bank provided documents showing large sums had been transferred from the account to another bank. M obtained a Bankers Trust order against that bank. M chose to commence proceedings in breach of contract and fiduciary duty against 18 defendants, including X and K, in Canada, because it was based there and K owned valuable property there. The addresses of those defendants ranged from the United Kingdom and Canada to Barbados, Switzerland and Cyprus. X contended that M's applications for Bankers Trust orders were an abuse of process because the documents obtained were used for the purposes of the Canadian proceedings, that M's use of the documents in the Canadian proceedings was in breach of the collateral undertaking under CPR r.31.22 that a document would be used for the purpose of proceedings in which it was disclosed, and that, if either argument succeeded, the court should not give retrospective permission to M to use the documents in the Canadian proceedings.

Held

(1) X were not entitled to set aside orders made against third parties, and with which those third parties had fully complied, WEA Records Ltd v Visions Channel 4 Ltd (1983) 1 WLR 721 CA (Civ Div) applied (see paras 12-13 of judgment). (2) X's abuse of process submission assumed that it must have been apparent to M when making its applications that the claims were going to be pursued in Canada. However, it was clear that, even at the time of the second application, M remained unsure of what proceedings were going to come out of the applications, or whether proceedings were even viable. The aim of the applications was to obtain sufficient information to allow M to come to a careful and considered view on what claims could be made and where they should be launched. Given the huge range of jurisdictions open to M it was not obvious that proceedings would inevitably be commenced in Canada. Accordingly, it was not a case in which Bankers Trust applications were made for the disclosure of documents which the applicant always knew would not be deployed in proceedings in the UK. Furthermore, there was clear authority that a Bankers Trust order could be sought in a situation which led to a claim in a foreign jurisdiction, Omar (Mohamed) v Omar (Chiiko Aikawa) (1995) 1 WLR 1428 Ch D applied. The fact that M had issued personal claims as well as proprietary tracing claims did not point to an abuse of process, Omar applied (paras 20-21, 23, 26). (3) In principle the collateral undertaking in CPR r.31.22 applied to documents disclosed pursuant to Bankers Trust orders, SmithKline Beecham Plc v Generics (UK) Ltd (2003) EWCA Civ 1109, (2004) 1 WLR 1479 applied. However, where an application was made for a Bankers Trust order on the express basis that subsequent proceedings were likely, the court in making the order was implicitly giving permission to the applicant to use the documents in those subsequent proceedings. The absence of express restrictions equated to implied consent by the court to the subsequent use of the documents, provided they were used for the purpose which the court intended in making the order originally. Therefore M's use of the documents in the Canadian proceedings was not a breach of the collateral undertaking because it fell within the exception in CPR r.31.22(1)(b) for where the court gave permission (paras 37, 38-39). (4) If it had been necessary, retrospective permission would have been granted. Any breach by M was inadvertent, and if a specific application had been made when the orders were sought permission would have been given. X would not suffer any prejudice in consequence of any retrospective permission, and if retrospective permission was all that stood between M and an order prohibiting it from using the disclosed documents, it would still have been granted (para.46).

Applications refused

Queen's Bench Division
Coulson J
Judgment date
13 December 2011
References

​LTL 10/1/2012 : [2011] EWHC 3278 (QB)