Bank of Tokyo-Mitsubishi UFJ Ltd v Baskan Gida Sanayi Ve Pazarlama AS & Ors (2008)
Cases involving an inequality of arms did not call for some different or more rigorous test to be applied on applications for strike-out or summary judgment under CPR r.3.4(2) or CPR r.24.2 than those that were already the subject of substantial, consistent and well-settled authority.
The applicant twelfth defendant (S) applied to strike out the claims of the respondent banks (B) against him, or for summary judgment on those claims. B's claims had arisen out of a written loan facility agreement under which trade finance was provided to the first defendant company (G). B alleged that G subsequently transferred the whole of its assets and businesses to two companies, who in turn sold them on with the consequence that when repayments to B became due, G was a worthless shell. B's claims included a debt claim against G, conversion claims and claims in deceit against companies who had received G's assets contrary to B's security, and as against S, a claim in conspiracy. The conspiracy claims concerned the procurement of advances from B to G by unlawful means and to defeat the rights of B and other creditors of G. S sought to strike out B's claims pursuant to CPR r.3.4(2) or, alternatively, for defendant's summary judgment on all claims against him pursuant to CPR r.24.2. S contended that the particulars of claim were unreasonably vague, wanting in particularity and disclosed no reasonable grounds for bringing the claims against him and that B had no reasonable prospect of success. S submitted that, in the light of the inequality of arms between the parties, it would be oppressive and unfair to require him to defend the claims, and that the overriding objective required the court to apply a more than usually stringent standard or test to the questions whether there were reasonable grounds for bringing the claim or whether B could show that they had a real prospect of succeeding on their claim against him.
Whilst sympathy could be had with the plight of a private individual drawn into a long and complex conflict between sophisticated and well-resourced companies, cases involving an inequality of arms did not call for some different or more rigorous test to be applied on applications under CPR r.3.4(2) or CPR r.24.2 than those that were already the subject of substantial, consistent and well-settled authority. (2) The claims for conspiracy against S depended critically upon his knowledge and the question whether that requisite knowledge was to be inferred depended upon an appreciation of the whole pleaded circumstances, rather than by a review of each one in isolation. It was well-established that strike-out and summary judgment applications should not be allowed to degenerate into a mini-trial and if the claim was not demonstrably bad as a whole, then no useful or proportionate purpose would generally be served considering whether some small parts of it could be struck out. In the instant case, the allegations against S, taken as a whole, fairly disclosed reasonable grounds for a claim against him in unlawful means conspiracy. It followed that the application based upon CPR r.3.4(2) failed. Further, on a broad analysis, B had a real prospect of success against S and the summary judgment application under CPR r.24.2 also failed.
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