This judgment was handed down remotely at 10.30am on 14 March 2025 by circulation to the parties or their representatives by e-mail and by release to the National Archives.
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Mr Justice Murray:
- The claimant, Mr Neeraj Handa, seeks to challenge the decision of Deputy Senior District Judge Ikram ("the Judge"), sitting at Westminster Magistrates' Court ("the WMC"), made on 12 January 2024 ("the Decision") to set aside summonses granted by a legal advisor at the WMC on 3 March 2023 ("the Summonses") against each of the interested parties, Mr Aran Handa and Mr Aneil Handa. The Summonses were for a private prosecution by the claimant of the interested parties in relation to five alleged offences of fraud, contrary to sections 1 and 4 of the Fraud Act 2006.
- The claimant's application for permission to apply for judicial review was granted by Lavender J on 9 August 2024. The question for me to determine is whether the Decision was unlawful on the basis that it was wrong in law or irrational or both. This is not a full re-hearing of the merits of the application made by the interested parties to set aside the Summonses.
Background
- The claimant's father, Mr Arvan Handa, is a brother of the first interested party and therefore the claimant's uncle. The second interested party is the son of the first interested party and therefore the claimant's first cousin.
- Mr Arvan Handa and the first interested party are the sons of Mr Roshan Handa, who founded a family-owned company named The Station Hotel (Newcastle) Limited (Company Number 01958222) ("SHNL"). At the relevant times, the three shareholders of SHNL were Mr Roshan Handa, Mr Arvan Handa, and the first interested party. The claimant and both interested parties worked for SHNL.
- The claimant was appointed a director of SHNL on 19 May 2022 and was removed as a director for alleged "gross misconduct" on 6 April 2023. He has brought a claim for unfair dismissal against SHNL before the Employment Tribunal in Newcastle on the basis that he made eleven "protected disclosures" as an employee to SHNL, including, but not limited to, the allegations of fraud to which the Summonses relate.
- The claimant alleges that the first interested party and the second interested party committed fraud by knowingly using assets of SHNL to pay for their own business ventures in 2019/2020 and to pay for the second interested party's wedding in Paris in May 2022. The claimant alleges that the first interested party and the second interested party misrepresented five invoices as relating to the business of SHNL and arranging for them to be paid by SHNL, as follows:
i) Calma Group invoice number SI-633 dated 29 March 2019 for £330,000 (including VAT);
ii) Calma Group invoice number SI-657 dated 6 June 2019 for £216,000 (including VAT);
iii) Calma Group invoice number SI-753 dated 28 June 2019 for £104,000 (including VAT);
iv) Kiwi Hospitality invoice number 92a dated 3 March 2022 for £30,000 (including VAT); and
v) Kiwi Hospitality invoice 92b dated 3 March 2022 for £30,000 (including VAT).
- The claimant also alleges that, as these invoices did not relate to legitimate expenditure of SHNL, the VAT elements were incorrectly reclaimed by SHNL in the relevant quarterly VAT returns. Net of VAT, the alleged total loss to SHNL as a result of payment of these invoices was £592,000.
- The claimant's case is that he confronted the interested parties. He then made a whistle-blowing report to SHNL's auditors, BDO LLP ("BDO"), and reported the alleged frauds to the other directors of SHNL and to relevant employees. However, no action was taken against the interested parties, and SHNL's annual accounts were approved by the first interested party and lodged with Companies House.
- On 21 February 2023, the claimant made a without notice (ex parte) application at WMC for a summons to bring a private prosecution against each of the interested parties.
- On 2 March 2023, a legal adviser at WMC, exercising the powers of a single Justice of the Peace, issued the Summonses.
- The interested parties applied to have the Summonses set aside, challenging the disclosure process and the claimant's motivation, credibility, and integrity. The Judge heard their application at the WMC on 19 October 2023 and 2 November 2023. On 12 January 2024, he handed down his judgment setting out his reasons for making the Decision ("the Judgment").
Procedural history
- On 10 March 2024, the claimant filed his application for permission to apply for judicial review of the Decision, including his statement of facts and grounds for review ("SFG").
- On 9 April 2024, the interested parties filed their acknowledgement of service and summary grounds for contesting the claim ("SGC").
- On 12 August 2024, as already noted, Lavender J granted the claimant permission to apply for judicial review. In his order, he included the following observation:
"I note that it is contended (in paragraph 92 of the statement of facts and grounds) that the judge's finding as to the Claimant's motivation, which is central to his decision, was based on a number of matters which were not in evidence."
- On 16 September 2024, the defendant, WMC, wrote to the court to say that it would not be making any submissions in these proceedings but would contest any costs order, if one were sought against it. On the same day, the interested parties wrote to the court to confirm that their SGC would stand as their detailed grounds for contesting the claim.
The Judgment
- In the Judgment, the Judge referred to the claimant as "P" (as the intended private prosecutor) and the interested parties as "D1" and "D2", respectively (as the intended first and second defendants). The Judge began the Judgment by briefly reviewing the background at paragraphs 1-10, including setting out the relationships between the claimant, the interested parties, Mr Arvan Handa and Mr Roshan Handa.
- At paragraph 11 of the Judgment, the Judge summarised the claimant's applications for the Summonses, noting that they were supported by (i) witness statements from the claimant and from Mr Chris Stafford, who was a quantity surveyor at SHNL at the relevant times; (ii) the claimant's reports to Action Fraud and HM Revenue & Customs; and (iii) correspondence with Calma Group and its solicitors.
- At paragraphs 12-14 of the Judgment, the Judge summarised the claimant's evidence supporting his allegations in relation to each of the five relevant invoices. In relation to each invoice, the claimant alleged that the first and second interested parties abused their respective positions as directors of SHNL to approve the invoice for payment even though it was not an invoice for legitimate business expenses of SHNL.
- In the case of the first two invoices, which were from Calma Group Limited, the claimant alleged that these related to a business agreement between the second interested party and a company called Kobox Limited for the redevelopment of a gym in Chelsea. This was a separate business venture in which SHNL had no financial interest. The claimant had at one time been involved in the gym project, but he had withdrawn from it. Although Calma Group was at the relevant time undertaking some development work for SHNL at one of its hotels, the claimant maintained that these invoices did not relate to such work and therefore were not legitimate business expenses of SHNL.
- In relation to the third invoice from Calma Group Limited, the claimant alleged that this, which was recorded as "assisting with telecoms installation and electrical works", in fact, related to work at "Vap Restaurants" (referred to elsewhere in the papers as "Vapiano restaurants"), which was owned by a company in which the second interested party had an interest. The first interested party had approved this invoice for payment, but he should not have done so as the invoice was for services rendered to a business in which SHNL had no stake, and therefore it did not represent a legitimate business expense of SHNL.
- In relation to the fourth and fifth invoices, which were from Kiwi Hospitality, the claimant alleged that these related to hospitality services provided for the second interested party's wedding in Paris in May 2022. The invoices were stated to relate to "staff training". According to the claimant, these were private non-business expenses that should have been paid by the first or second interested party personally and not legitimate business expenses of SHNL.
- In support of his applications for the Summonses, the claimant also provided a report from Mr Barry Lewis, a Fellow of the Chartered Institute of Building, in which Mr Lewis gave his reasons for concluding that the three Calma Group invoices were not genuine but were, in fact, fraudulent.
- At paragraph 15 of the Judgment, under the heading "Evidence of Potential Improper Motive NOW Known to the Court" (emphasis in original), the Judge said the following:
"The current shareholders are Roshan and his two sons, Arvan and Aran (D1). Roshan's will states that upon his demise, his share of 30% will be divided equally between his grandsons, Neeraj (P), Aneil (D2) and his brother Naveen.
This would result in Aneil (D2), Naveen and their father Aran (D1), controlling 55% of the shares. The prosecutor, Neeraj (P) and his father, Arvan, would control the remaining 45%.
D1 and D2 say that P (and his father) having a future minority shareholding in a £120 million business, was 'something he was prepared to do almost anything to prevent.'
The defence suggest there was dysfunction in the business and P wrote to his own father in 2016 and said 'You are an idiot. You are weak. You agreed and then renegades under pressure. You need to face up.' His father replied that he was 'terrified and everyone the same petrified including staff.' P responded 'Good, I have not even started yet – there ain't no sunshine when it rains.'
In 2016, notes of a joint family counselling meeting - records P as stating as regards D1 'threatens to put him in jail and revenge for what he has done to him.'
Independent consultants brought in to split the business circa 2019 noted 'trust issues inhibiting productive working relationships' and 'Neeraj's long standing hatred for Aran made him totally irrational.'
In 2021, in order to reduce company debt, there was a proposal to sell 3 of its hotels (Project 3). In 2022, when his father supported the deal, P stated to his father 'If this deal happens, I will create all hell' having said in an earlier email 'you are a poor father… My only aim in life is to make my son does not grow up around you.'
In 2022, a shareholders' resolution was passed to explore a separation of the company. A WhatsApp message 3 days later from P stated it was 'criminal for Aneil' "
- At paragraphs 16-25 of the Judgment, the Judge set out the legal principles relevant to an application to magistrates for a summons and, therefore also, an application to set it aside. He noted that these legal principles were not in dispute before him. He began by quoting the well-established principles set out in the decision of the Divisional Court in R v West London Metropolitan Stipendiary Magistrate, ex parte Klahn [1979] 1 WLR 933 at 935H-936A, which include the necessity for the magistrate to determine, among other things, whether the essential ingredients of the alleged offence are prima facie present and whether the allegation is vexatious.
- The Judge also quoted from a passage in R (Kay) v Leeds Magistrates' Court [2018] EWHC 1233 (Admin), [2018] 4 WLR 91 (DC) at [22], where the Divisional Court, after setting out at [21] a long quotation from Ex parte Klahn including the part to which I have just referred, noted that, if the relevant conditions are satisfied (namely, the essential ingredients of the offence are prima facie present, the allegation is not out of time, the court has jurisdiction, and the informant has the necessary authority to prosecute), then the magistrate ought to issue the summons "unless there are compelling reasons not to do so". Compelling reasons not to issue the summons would include where the application is vexatious, is an abuse of process or is otherwise improper. An example of a vexatious application would be one involving the presence of an improper ulterior motive.
- The Judge noted that Crim PR r 7.2(14) states that a court may refuse to issue a summons if, among other things:
"…
(b) the prosecutor fails to disclose all the information that is material to what the court must decide; [or]
…
(f) the prosecutor's dominant motive would render the prosecution an abuse of the process of the court."
- The Judge made it clear that he accepted that there will often be mixed motives in bringing a private prosecution and that the applicant for a summons for a private prosecution will often have a direct interest in the outcome.
- Finally, in summarising the legal principles the Judge noted that:
i) the claimant in making his application for a summons was under an obligation to disclose all relevant material:
"… in order to enable the court to properly carry out its duty to consider whether the application was vexatious, an abuse of process or otherwise improper; to consider whether to make further enquiries; to require the [intended defendants] to be notified of the application; and to hear the [intended defendants]" (quoting from Kay at [37])
ii) the claimant in making his application on a without notice basis was obliged to:
"… put on his defence hat and ask himself what, if he were representing the defendant or third party with a relevant interest, he would be saying to the judge, and, having answered that question, that is what he must tell the judge" (Re Stanford International Bank Ltd [2011] Ch 33 (Hughes LJ) at [191], quoted in Kay at [26]).
- At paragraphs 26-27 of the Judgment, the Judge identified the following as the issues that he potentially needed to resolve:
i) did the charges against the interested parties set out in the claimant's application for a summons set out a prima facie case against each of the interested parties; and
ii) was the claimant's without notice application and the proposed private prosecution an abuse of process for lack of candour in disclosure at the stage of issue, also "having regard to the conduct of the prosecution following the grant of the summonses"?
- The Judge noted that the interested parties argued that the claimant had not made any conscientious attempt to comply with his duty of disclosure and of candour with the court and that the "prosecution as a whole are either unwilling or at the least, incapable of discharging the full measure of the responsibilities of that role". The Judge then reformulated the question that he was required to answer as follows:
"Has D1 and D2 (upon whom the burden lies) satisfied the Court that there are compelling reasons to find that the allegations are vexatious or that the issue of the summonses would involve an abuse of the process of the court: either (a) on the ground that the proceedings are vitiated by an oblique motive which is so dominant and so unrelated to the proceedings that it renders them an abuse of process; or (b) on grounds of failure to comply with the duty of candour."
- At paragraphs 28-61 of the Judgment, the Judge sets out his findings in relation to the issues of:
i) whether there was a prima facie case;
ii) whether the claimant had complied with his duty of candour; and
iii) whether the prosecution was so tainted by an improper motive on the part of the claimant as to render it an abuse of process.
- In relation to the question of whether the claimant had set out a prima facie case, which is dealt with primarily at paragraphs 28-37 of the Judgment, the Judge was not entirely clear. He reviewed the evidence presented by the claimant with the without notice application for the Summonses, and he noted, among other things, that:
i) the claimant had made formal complaints to the police and to HMRC about the five relevant invoices roughly a year prior to the date of the Judgment, and neither had indicated a decision to commence a prosecution against the interested parties;
ii) SHNL conducted an internal inquiry into the claimant's allegations regarding the five relevant invoices and SHNL's auditors, BDO, spent 30 hours investigating the allegations, and neither the internal enquiry nor the BDO investigation had found evidence of fraud; and
iii) the report of Mr Lewis relied on by the claimant was "unorthodox" in its structure and approach, failed to state the basis on which his expert opinion was given save on facts relayed by Mr Stafford, and included conclusions on the ultimate issue that were inadmissible.
- In relation to the three Calma Group invoices, the Judge noted at paragraphs 36-37 of the Judgment that he had not had the benefit of all the evidence considered by BDO and therefore could not make an assessment of it. He concluded:
"On the face of the evidence presented, there is a prima facie case against both defendants on counts 1, 2 and 3. … I must consider whether there is a prima facie case and find there is." (emphasis in the original)
- In relation to the two Kiwi Hospitality invoices, the Judge noted at paragraphs 38-39 of the Judgment that there was no evidence that the second interested party had any involvement with them, whether before or after they were issued. The Judge concluded that there was no prima facie case against him in relation to those invoices, but "I am satisfied that there was and remains a prima facie case to answer against Aran (D1)."
- Having made these apparently clear statements about there being a prima facie case against both interested parties in relation to the three Calma Group invoices and against the first interested party in relation to the two Kiwi Hospitality invoices, the Judge then, somewhat confusingly, said at paragraph 61 of the Judgment, having concluded that the private prosecution was an abuse of process by the claimant:
"… I, therefore, need not consider further whether in fact, there is a prima facie case on the charges."
- Mr Adrian Darbishire KC, counsel for the interested parties, submitted that paragraph 61 of the Judgment made it clear that the Judge did not find there was a prima facie case against the interested parties. He accepted that there was an inconsistency in the Judgment, but for the reasons he had set out in detail in his speaking note dated 27 October 2023 prepared for the hearing before the Judge ("the Speaking Note"), he submitted that the material supporting the claimant's application for a summons did not establish a prima facie case.
- While it is not necessary for me to resolve this question in order to determine this application for judicial review for reasons that will become clear in due course, I should note that I have serious doubts as to whether the Judge was correct to find a prima facie case against both interested parties in relation to the Calma Group invoices and against the first interested party in relation to the two Kiwi Hospitality invoices if, despite paragraph 61 of his Judgment, he did so find.
- The Judge made clear reference to the matters I have summarised at [32] above, which, properly understood, raise serious doubts about the evidential basis for the allegations on which the claimant's application for a summons was based. There seems to be considerable force in the submissions made by Mr Darbishire in the Speaking Note at paragraphs 4-23. I set out his conclusion on the question of whether there is a prima facie case at paragraphs 22-23:
"22. We question on what rational basis the prosecution invite the Court to conclude that there is a prima facie case of fraud, when the Company itself, and its auditors, have investigated the matter and confirmed that the sums are properly accounted for? The prosecution can identify no witness capable of proving a fraud. The prosecutor himself has no direct knowledge at all of the invoices or of liability for them. The other prosecution witness himself approved one of the invoices, as well as the bank drawdowns based on the others. The material referred to at §11 of the Prosecution Skeleton does not establish a prima facie case. The evidence before the Court is not capable of proving to the criminal standard that the company was not liable to pay the invoices, let alone a case of fraud. What evidence, for example, do the prosecution rely upon as proving that Aneil Handa had anything to do with any Kiwi invoices at all?
23. We accept that a private prosecutor is not in law bound to comply with the Code for Crown Prosecutors, although that is the standard with which the prosecution claim to comply. However, a Court may look askance at an attempt to prosecute a case where, as here, there is no reliable evidence and no public interest. The prosecutor has reported these complaints to HMRC and the police, but not waited for a decision. No doubt the prosecution recognise that those bodies will not investigate further, as there is no evidence of an offence. The Code test may not have to be satisfied, but the fact that a case is weak or hopeless is a relevant factor the Court should take into account, even if the prima facie test is satisfied. As the Court observed in ex p Holloway [R (Holloway) v Harrow Crown Court [2019] EWHC 1731 (Admin), [2020] 1 Cr App R 8 (Divisional Court)]:
'19. Two points relevant to the position of private prosecutors deserve emphasis. First, in their role as "ministers of justice" prosecutors have a duty to undertake an independent and objective analysis of the evidence before commencing proceedings to determine whether there is a realistic prospect of a conviction. This requires an assessment not only of what evidence exists, but also of whether it is reliable and credible, and whether there is other evidence which might affect the position. As the Code for Crown Prosecutors states:
"When deciding whether there is enough evidence to charge, Crown Prosecutors must consider whether evidence can be used in court and is reliable and credible, and there is no other material that might affect the sufficiency of evidence. Crown Prosecutors must be satisfied there is enough evidence to provide a 'realistic prospect of conviction' against each defendant."
20. It was common ground before us that a private prosecutor is under the same duty, or at any rate is more likely to be treated as having committed an improper act or omission if he fails to carry out such an analysis.' "
- In relation to the quotation from Ex parte Holloway at paragraph 19 of the Speaking Note, I note that the Divisional Court in Kay at [23] also makes the overarching point that a private prosecutor is subject to the same obligations of a Minister for Justice as are the public prosecuting authorities. This includes the duty to make a fair and objective assessment of whether there is a proper evidential basis for a private prosecution.
- I turn now to the crux of the Judgment, namely, the Judge's conclusions regarding whether the claimant had breached his duty of candour in relation to his application for the Summonses and whether he had an improper motive in seeking to bring a private prosecution.
- In relation to the duty of candour, at paragraphs 40-49 of the Judgment, the Judge sets out his detailed findings. He concludes that there were multiple failures by the claimant to comply with his duty of candour. To give a single, but important, example, the Judge found at paragraph 40(xiv):
"Significantly, the case summary fails to make any mention of the review by the external auditors, BDO, and their finding that there was no fraud on the Calma and Kiwi invoices. They had also taken into account the expert report by Mr Lewis.
I find this omission striking and significant. P was clearly aware of the findings, though does not accept them. Yet, P and those who drafted the case summary chose to make no mention of the fact that qualified accountants had signed off the audit and found no basis for the invoices to be fraudulent. There had been a whistleblower and BDO specifically asked questions of the company and were satisfied with the responses.
Again, even if it is argued that the conclusion was wrong, it was incumbent on P and his lawyers who drafted the case summary to draw the court's attention [to] this evidence which potentially undermined P's application.
P's own witness statement on point makes reference to the BDO audit but does not state its findings. He should have explicitly drawn it to the court's attention."
- The Judge found that there was evidence of a "clear lack of understanding" by the claimant's solicitors of what was required by the duty of candour. Having reviewed correspondence between the parties, the Judge noted that some of the responses by the claimant's solicitors to correspondence from the solicitors for the interested parties "suggest a lack of understanding of the concept of candour in the context of a criminal prosecution". The Judge also emphasised, however, that the claimant bore ultimate responsibility for compliance with the duty of candour.
- Among other failures to comply with the duty of candour, the Judge found that the claimant had failed to disclose evidence or information sufficient to provide the court with a true picture of the relationship between the claimant, the interested parties, and other relevant family members. The Judge noted that in the claimant's case summary supporting his application for a summons "there is the barest mention of relationships becoming strained" and in the claimant's witness statement to the relationship between the claimant and the interested parties "'becoming a bit strained' and unpleasant messages were exchanged". The Judge considered that, on the basis of evidence before him provided by the interested parties, to be "a gross understatement and now, clearly untrue". The Judge concluded that claimant's case summary did not present a balanced picture of the history between the claimant and the interested parties nor did it make reference to any of the matters summarised at paragraph 15 of the Judgment ( see [23] above).
- The Judge found, in effect, that these failures to provide a frank account of the relationship between the claimant and the interested parties meant that the legal adviser who considered the claimant's application for the Summonses was denied the opportunity to consider on a properly informed basis the claimant's dominant motive in bringing the private prosecution.
- At paragraph 40(xi), the Judge noted:
"The conclusion of the Case Summary at Para 37, in particular, fails to disclose the full extent of disagreement and threats and creates the false impression that P brings the prosecution simply because of inaction on his reporting of the allegations.
I find that to be incorrect. There was, in fact, action taken and consideration of his complaints."
- The Judge found that there were also disclosure failures in relation to communications between the claimant and his witness, Mr Stafford, which could be construed to include an agreement between them that another possible prosecution witness should be encouraged to lie. The Judge also found that the claimant had failed to disclose evidence of possible collusion between prosecution witnesses arising from "strikingly similar accounts of the chronology of events" in their respective witness statements. The Judge fully accepted that whether there had, in fact, been such collusion would be a matter for trial, but this evidence caused him "real concern" as to whether a private prosecution by the claimant would be conducted fairly and objectively.
- The Judge found that the claimant had failed to disclose evidence that supported the view that the third Calma Group invoice was not fraudulent but a legitimate expense of SHNL relating to telecom-related repairs at the Treehouse Hotel. The Judge noted that, even if the claimant disputed that evidence, he was obliged to disclose it as part of his compliance with his duty of candour. The Judge also found that there was evidence that the claimant himself might have improperly used company funds. Even if denied, this evidence should have been disclosed by the claimant to the WMC in connection with his application for a summons, given its potential bearing on his credibility as a witness of truth.
- At paragraph 44 of the Judgment, the Judge summarised the five factors that he said that he needed to consider in order to determine the consequences of the claimant's breaches of his duty of candour, which the Judge said that he drew from the case of R (Siddiqui) v Westminster Magistrates' Court [2021] EWHC 1648 (Admin), [2021] 2 Cr App R 25 (DC). These were:
i) whether a failure in the duty of candour was made out;
ii) whether any failure made out was deliberate;
iii) whether any failure made out was a "deliberate attempt to mislead the court or withhold or hide information as opposed to a mistake as to what needed to be included";
iv) the extent to which the defendant (to the proposed private prosecution) had suffered any prejudice; and
v) the public interest in the allegations.
- With respect to the Judge, factors (i), (ii) and (iii) logically precede the question of how to determine the consequences that flow from the breaches of the duty of candour that the Judge found.
- At paragraph 45 of the Judgment, the Judge noted that the remedy sought by the interested parties for the claimant's breaches of his duty of candour was the withdrawal of the Summonses. In relation to that, the Judge said at paragraph 46:
"The case of Siddiqui suggested that the correct test is 'whether the breach of candour might have made a difference to the issue of the summons' and described his as compelling (though did not ultimately need to determine the question)." (emphasis in the original)
- In fact, this test is one of two suggested by different lines of authority. The two tests and lines of authority are discussed in Kay at [27]-[28]. That passage from Kay is reproduced in Siddiqui at [37]. The two tests are whether the breach of the duty of candour by a private prosecutor "would" or "might" have made a difference to the judge's decision to issue the summons. It was the Divisional Court in Kay that commented that the reasoning in the line of authority supporting the "might" test was "compelling" but then declined to express a concluded view on which test was correct as it was not necessary to decide Kay. As far as I am aware, this conflict in the case law has not yet been reconciled.
- In Siddiqui, it was not necessary to choose which of the two tests to apply because that case was a challenge to a district judge's decision to quash a summons. It was already clear, in other words, that the relevant non-disclosure had made a difference to the district judge's decision. The question for the Divisional Court was therefore whether the prosecutor's non-disclosure "should" have led to the district judge making that decision. The Divisional Court in Siddiqui ultimately decided that question in the negative.
- At paragraph 48 of the Judgment, the Judge rejected the suggestion that the claimant's non-disclosure was not deliberate. He found that:
"… it was deliberate in that the case summary presented the case in the most favourable way to the prosecutor and was designed to do so. It was not an oversight or by accident."
- At paragraph 49 of the Judgment, the Judge concluded that the non-disclosure might have made a difference as to whether a summons was issued or not.
- At paragraphs 50-59 of the Judgment, the Judge turned to consideration of the claimant's motive for bringing a private prosecution against the interested parties. In summary, he concluded that:
i) the claimant failed to disclose the true extent of the animosity that existed between him and the interested parties, and the breakdown of those relationships as well as other relevant family members, including his father and his uncle Aran's side of the family;
ii) the "real and dominant motive" behind the claimant's application for a summons was "to seek to destroy through criminal prosecution the other wing of the family who P had come to despise", due to having become convinced that the "other wing" of the family was making commercial progress and his side of the family was being left behind;
iii) the claimant's application for a summons did not fairly state "the degree of 'bad blood' and what can only be described as hatred expressed by P towards others";
iv) the claimant's lack of interest in the outcome of the police and HMRC investigations into his allegations, as evidence by the chronology of the case, led the Judge to conclude that the claimant was not interested in the outcome of an independent review of the evidence supporting his allegations; and
v) the Judge had "grave concern" about the claimant's honesty as a prosecutor as evidenced by the striking similarity between his witness statement dated 24 August 2023 and that of his main witness, Mr Stafford, dated 23 August 2023, which suggested a degree of collusion between them as to their evidence (as the Judge had noted at paragraphs 40(ii) and 59 of the Judgment).
- The Judge considered that the evidence that he outlined at paragraph 15 of the Judgment demonstrated the true motives behind the prosecution. The Judge found that the prosecution was not for mixed motives, as is often the case with private prosecutions, but was "initiated with the primary motive to harm the Defendants and their continuing involvement in the company and, thus, for wholly spiteful improper motive".
- In short, the Judge concluded at paragraph 59 that:
"… P HAS NOT and WILL NOT discharge his obligations as a prosecutor / minister of justice fairly, honestly and objectively."
- At paragraph 60 of the Judgment, the Judge found that the claimant's private prosecution was an abuse of process, and he therefore set aside the Summonses.
- Finally, at paragraph 61 of the Judgment, the Judge noted that neither HMRC nor the police had pursued a prosecution following the claimant's complaints nor had the auditors, BDO, made any findings of fraud after 30 hours spent investigating the invoices. He concluded that the claimant's disclosure failures "could have made" a difference to the issue of the Summonses and, for the reasons he had given, he set aside the Summonses. I have already mentioned that he also concluded at this point in the Judgment that he therefore did not need to consider whether "in fact, there is a prima facie case on the charges".
The grounds of challenge
- In summary, the claimant's grounds of challenge are as follows:
i) Ground 1: it was irrational of the Judge to find that any breach of the duty of candour by the claimant was deliberate;
ii) Ground 2: the Judge's findings regarding the claimant's motive for bringing the prosecution were irrational, on the basis of all the material before him;
iii) Ground 3: on the basis of his findings as to the claimant's motive, the Judge was wrong to conclude that his motive was so oblique as to require the Summonses to be set aside;
iv) Ground 4: the Judge's findings as to the integrity of the claimant were irrational, on the basis of all the material before him; and
v) Ground 5: the Judge was wrong in law to conclude that the claimant's conduct in applying for the Summonses amounted to an abuse of process.
The parties' submissions
Ground 1
- In support of Ground 1, Mr Gideon Cammerman KC on behalf of the claimant submitted that the claimant did not seek to initiate this matter as a litigant in person or using his own solicitors. The claimant had instructed lawyers in London who had held themselves out as experienced and expert in conducting private prosecutions. The claimant's counsel at the hearing before the Judge accepted that errors and omissions in disclosure were his own, were an oversight, and were not intentional. It was, therefore, irrational to conclude that any breach of the duty of candour by the claimant was deliberate.
- Mr Cammerman submitted that the claimant's applications for the Summonses included over 800 pages of witness statements and exhibits. Those witness statement and exhibits contained references to a number of the issues that the Judge identified as arguments militating against the grant of the Summonses that should have been drawn to his attention. The witness statements supporting the claimant's applications for the Summonses repeatedly set out that the claimant acknowledged that material must be disclosed, and that disclosure would occur at the disclosure stage of the case. In any event, nearly all of the material that the interested parties complained should have been drawn to the court's attention was in their possession at all times.
- Mr Cammerman submitted that in reaching his finding that the claimant's breaches of the duty of candour were deliberate, the Judge did not distinguish between disclosure included in the statements and exhibits supporting his applications for the Summonses and material that was not provided at all to the legal adviser at WMC. The Judge's finding that the Summonses were issued without consideration of the papers that were included with the application was irrational and without a basis. There were strong grounds to conclude that the legal adviser who issued the Summonses had considered the material properly.
- Finally, Mr Cammerman submitted that the claimant's failure to include a section on the duty of candour in his case summary was a failing that must be distinguished from any failure to disclose material with the applications. Where the supposedly missing material was included in the claimant's witness statement, for example, and formed part of the applications, it was irrational for the Judge to have concluded that this information was not disclosed. It was also irrational for the Judge to have concluded that any non-disclosure was deliberate.
- Responding on behalf of the interested parties, Mr Adrian Darbishire KC submitted that it appeared now to be accepted by the claimant that there had been a breach of the duty of candour. There had been nothing in the case summary or in any document supplied with the claimant's applications for the Summonses that reflected an attempt by the claimant to present a balanced or candid picture to the court. Nor was there anything in those materials designed to highlight or point to any undermining evidence or other material.
- Mr Darbishire submitted that the claimant's present attempt to rely on reference to documents that were conspicuously absent from the case summary served in support of the claimant's applications was both opportunistic and unprincipled. The Judge's finding that the claimant had failed to comply with the duty of candour was the only possible finding available to him, given that:
i) the claimant failed to be transparent or to highlight any adverse material at all in connection with his applications;
ii) the claimant positively misrepresented the true position; and
iii) the claimant omitted relevant adverse material about which he was aware, but which may not have been known to his lawyers at the time of the summons applications.
- Mr Darbishire submitted that the Criminal Procedure Rules expressly recognise at CrimPR r 7.2 that where there has been a deliberate breach of the duty of candour, that fact alone may be sufficient to justify setting aside a summons and refusing any further application. That also reflects the position at common law. On the facts of this case, he submitted, the breaches of the duty of candour were sufficiently serious to justify the setting aside of the Summonses without more. However, the Judge did not rely simply on the breach of the duty of candour to set aside the Summonses. He reviewed the grant of the Summonses in the light of the totality of the information known to the court at the point of the application to set aside.
Ground 2
- In support of Ground 2, Mr Cammerman submitted that there was no evidence to support the Judge's finding that the claimant's hostility towards the interested parties amounted to an intention "to destroy" them, as the interested parties alleged. The evidence relied on by the Judge at paragraph 15 of the Judgment is either entirely incapable of malign interpretation or, at the least, is inadequate for such a finding. No document was served by the interested parties as a proper evidential foundation for the propositions that are set out by the Judge in paragraph 15 of the Judgment. These matters were simply advanced as fact or simply asserted.
- Mr Cammerman submitted that the documents that the interested parties had submitted were in the claimant's possession were not ever in his possession. The claimant's witness statement had detailed the breakdown of the relationship between the parties and included references to WhatsApp and other communication. The claimant undertook that all such messages would be made available for disclosure. Independent disclosure counsel made extensive disclosure of the claimant's personal messages.
- Mr Cammerman submitted that the Judge's conclusion that the claimant's description of the relationship as a "bit strained" was a gross understatement and untrue was irrational because that description related, not to the sentiment at the time of the applications for the Summonses, but to an entirely separate dispute in 2018. That was clear from the claimant's case summary and witness statement. The witness statement went on to set out in detail the events from 2018-2022. A rational reading of the account given by the claimant makes clear the total breakdown of the relationship between the parties.
- In response, Mr Darbishire submitted that the claimant was approaching the issue of his motive on a false basis. The starting point was that the claimant had not been wronged by the interested parties at all. He was not in any sense the victim of the alleged offences set out in the Summonses. The supposed "victim" of the alleged offences, SHNL, had carefully considered the allegations and did not consider it had been the victim of anything at all.
- On the facts of this case, Mr Darbishire submitted, the inference that the claimant was bringing the proceedings in pursuit of a personal grudge against the interested parties, unrelated to the alleged criminal conduct, was unavoidable. In reaching his conclusion, the Judge was entitled to have regard to matters such as:
i) the way in which the private prosecution was being conducted;
ii) material that was not disclosed to the court that suggested that the claimant had been involved in the misappropriation of company funds;
iii) material that evidenced the claimant making indiscriminate allegations against many others, often serious, none of which had been substantiated;
iv) the claimant's simple refusal to accept the findings of the independent directors or auditors in relation to his allegations of fraud in relation to the five disputed invoices; and
v) the claimant's refusal to await the outcome of the police investigation before initiating his private prosecution proceedings.
- Mr Darbishire submitted that all of this contextual material supported the Judge's essential finding as to the true motivation of the claimant's private prosecution.
- Mr Darbishire submitted that it was clear that the Judge acknowledged that the fact that a private prosecutor had mixed motives did not, of itself, render a private prosecution improper or an abuse of process. The Judge, however, in this case was confronted with a situation where the claimant had no good reason at all for bringing proceedings against his uncle and cousin. The claimant could not credibly claim that he was motivated by any public interest, as there was none. In bringing this private prosecution, the claimant was motivated by his pre-existing and irrational animosity toward his uncle and cousin. The Judge was entitled to find that the primary purpose of the private prosecution was to harm his uncle and cousin and their continuing involvement in the family company, SHNL, personally.
- Mr Darbishire submitted that the claimant's complaint that a part of the material relied upon by the Judge in making a finding as to the claimant's motives was drawn from the defence skeleton argument rather than the underlying material was entirely meritless. The Judge relied on an accurate precis of the underlying material. Whether the material was produced to the court or not could have made no difference to the Judge's findings. There was also no issue about the fact that the claimant had repeatedly expressed hostile views about various members of his family and, in particular, about the interested parties. However, the claimant failed to bring any of this material to the attention of the WMC when applying for the Summonses, and yet the material was of a kind which the claimant was plainly under a duty to disclose.
- Finally, Mr Darbishire submitted that it was not understood on what basis the claimant maintained that his comments relied upon by the Judge were "isolated". The examples before the Judge showed a consistent pattern of behaviour on the claimant's part. The material relating to the claimant's hostility to his family and vindictive nature was far from tenuous. It was overwhelming, and there was nothing before the Court to contradict it.
Ground 3
- In support of Ground 3, Mr Cammerman submitted that the Judge made a number of errors. The fact that a prosecutor wished to see a defendant punished for committing an offence did not mean that the prosecutor was malicious or was not seeking justice. There was no material to suggest that the claimant's belief that the payment of the five disputed invoices amounted to fraud on SHNL was not sincere or was not based on evidence. To the contrary, the evidence showed the claimant had taken every possible step to confront the frauds, pushing for a proper inquiry and being frustrated at every turn.
- Mr Cammerman submitted that even if it were possible rationally to conclude that the claimant felt the level of hostility towards the interested parties that the Judge attributed to him, the authorities as to motive for a private prosecution did not justify a stay in such a situation.
- Mr Cammerman submitted that the Judge should also have had regard to the claimant's instruction of legal representatives to prosecute the case, his instruction of independent disclosure counsel, and the volume of detailed disclosure that had been produced. Those steps by the claimant were consistent only with a desire to see the case prosecuted within the spirit and the letter of the law. Any failings by the professionals he had instructed did not support the attribution of a malign motive to the claimant.
- In response, Mr Darbishire submitted that Ground 3 failed for the same reasons that Ground 2 failed. He submitted that the only lawful exercise of the court's discretion in this case would have been not to grant the Summonses. The Judge found correctly that the evidence suggested that the claimant's long-standing hostility to the interested parties had nothing to do with the alleged offending. The prosecution was brought for an entirely private interest and lacked any true public interest rationale.
Ground 4
- In support of Ground 4, Mr Cammerman submitted that further points identified by the Judge as justifying his finding that the claimant lacked integrity and/or had deliberately failed to make disclosure did not, in fact, support his conclusion.
- Mr Cammerman submitted that the note purportedly from a third party accepting responsibility for the third Calma Group invoice, which the interested parties had produced in the closing hours of the second day of the hearing before the Judge, was dated long after the application. The claimant was in no position to speak to the bona fide nature or otherwise of the document. Even if it were genuine, the prosecutor could not have been aware of it at the time that he made the applications for the Summonses as it did not then exist.
- Mr Cammerman submitted that the claimant's failure to disclose with his original application that BDO had carried out a review of the five invoices and found no basis for considering that they were fraudulent was not material. The fact that the auditors did not find a fraud was not a positive finding that there was no fraud. It was also of note that the interested parties had not, to date, disclosed the BDO report, despite several requests by the claimant. In any event, the BDO report did not alter the Judge's finding as to prima facie case, nor could it. Therefore, the claimant had gained no unfair advantage in the prosecution by failing to disclose that BDO had found no basis for the invoices to be fraudulent.
- Mr Cammerman submitted that there was a lack of clarity in the Judge's finding that, following the claimant's complaints about the invoices, those complaints had been considered, and action had been taken. While the claimant's complaints led to an internal inquiry and an enquiry by BDO LLP, no action was taken against the interested parties.
- Mr Cammerman noted that the claimant accepted that the exchange between him and his witness, Mr Stafford, to which the Judge referred in the Judgment at paragraph 40(xii), should have been disclosed with the applications for the Summonses. It was, however, disclosed by the claimant during the proceedings. Furthermore, that disclosed exchange was not capable of justifying a rational finding that the claimant had suggested that a third party contractor fabricate evidence. It was also consistent with the claimant's genuine belief that the interested parties had improperly secured the third party contractor's cooperation in the false invoicing.
- Mr Cammerman noted that the filed statements of the claimant and his main witness, Mr Stafford, which the Judge considered had such strikingly similar accounts of the chronology of events that they raised a real possibility of collusion between them, were served long after the claimant's applications for the Summonses to address points raised by the interested parties. They both detailed a conversation between them, and it was entirely unsurprising that the chronology was the same as they followed a chronological conversation and commented on it in that order. The Judge was correct to comment in the Judgment at paragraph 40(xii) that this was, in any event, a matter for trial.
- Mr Cammerman noted that the Judge criticised the claimant for failing to disclose evidence that suggested that he himself may have improperly used company funds, but the claimant expressly included in his witness statement the attacks made on him by third parties. His only possible reason for doing so was to comply with his duty of candour.
- In response, Mr Darbishire submitted that the claimant had mischaracterised the points relied on by the Judge to conclude that he lacked integrity. The claimant's lack of integrity was independently demonstrated by the material before the court. For example, in relation to the third Calma Group invoice, the claimant was well aware before the Summonses were issued that SHNL believed that the invoice related to telecoms work and the fact that this was confirmed by relevant telecoms company. The claimant nonetheless made no mention of this to his lawyers or in any document supplied with his applications for the Summonses. There was therefore no error in the Judge's finding in this regard.
- Mr Darbishire submitted that the claimant had been told about the BDO forensic investigation of his allegations about the five invoices, and that he knew that BDO had found nothing to suggest a fraud. That was information that he was plainly obliged to draw to the court's attention when applying for the Summonses. The fact that he refused to accept BDO's findings on the point was irrelevant.
- Mr Darbishire submitted that the claimant discussed with his principal prosecution witness, Mr Stafford, encouraging a third party witness to advance a false explanation, which he knew would falsely exonerate the witness from complicity and, in doing so, would involve making a separate serious and false allegation of blackmail against the interested parties. That a prosecutor should be engaged in such conduct, which amounts to attempting to pervert the course of justice, would be a basis alone, and in itself, to refuse the claimant's applications for the Summonses.
- Mr Darbishire submitted that the Judge was entirely correct to conclude that the evidence raised a real possibility that the claimant and Mr Stafford had improperly colluded in the preparation of misleading witness statements.
- Finally, Mr Darbishire submitted that the evidence that showed the claimant misappropriating company funds was highly relevant. It was compelling evidence set out in the interested parties' application to set aside, and it has never been explained by the claimant. It should have been disclosed with the claimant's applications for the Summonses. If the claimant himself was engaged in the very conduct that he was alleging against the interested parties, that suggested that any concern he had about the interested parties' behaviour was entirely confected and hypocritical Again, evidence of this conduct by the claimant would certainly have been sufficient, on its own, to justify refusing to issue the Summonses on his request.
Ground 5
- In relation to Ground 5, Mr Cammerman submitted that there is simply no basis for the Judge to conclude that, at the time of the claimant's applications for the Summonses, the claimant had not discharged his disclosure obligations. The instruction of independent disclosure counsel with unfettered access to the claimant's devices and private communications was within the spirit and letter of the law. The Judge failed to identify any one document that the claimant has failed to disclose or to consider disclosure of, and the interested parties had advanced their argument in reliance on the material that was disclosed.
- Mr Cammerman submitted that although the claimant did not include a section in his ex parte application that directly advanced the interested parties' cases, that failure is to a very large extent mitigated by the extensive material disclosed with the claimant's applications. It was tenuous and speculative to argue that the interested parties might have advanced further points or items. There was a paucity of material identified, consisting, as it did, of isolated and unrelated quotations from years prior to his applications for the Summonses. This is despite the fact that at all times the interested parties had full access to all email communications on SHNL's servers, whilst the claimant did not, and his request for access to SHNL's emails had been refused.
- Mr Cammerman submitted that the claimant's witness statement provided with the application for summonses made adequate disclosure of the points relied on by the Judge as to the long-running animosity between the claimant and the interested parties, the various business disputes between them, the claimant's efforts to reveal wrongdoing and the failure of SHNL or anyone else to act on his concerns, the fact that the claimant was subject to grievances and complaints made by others, and related points. None of the failings identified by the Judge could, if properly understood and rationally assessed, justify the Judge's finding of an abuse of process or rationally made a difference to the legal adviser's decision to issue the Summonses.
- In response, Mr Darbishire submitted that the claimant's Ground 5 amounted to an attempt to argue that the disclosure process adopted was entirely compliant, however the failures in disclosure throughout the process were manifest. In a private prosecution, the prosecutor personally bears an obligation to ensure that the proceedings are conducted fairly throughout. The claimant continued to reveal his inherent unsuitability to occupy the role of prosecutor. For example:
i) the claimant had a propensity to make serious and unjustified allegations against others;
ii) the claimant's conduct in the workplace had been the subject of numerous internal complaints, a disciplinary report, and the claimant's employment was terminated for gross misconduct on 17 April 2023; and
iii) the claimant suggested that a principal witness should encourage a third party to make a false allegation of blackmail against the interested parties.
- Mr Darbishire submitted that the claimant's lengthy recitation of the abuse of process authorities relating to proceedings brought by public prosecuting authorities was wholly unhelpful. There was no equivalent of the duty of candour at the summons application stage because public prosecutors do not apply for summonses. The claimant has ignored the relevant part of the Criminal Procedure Rules that expressly identifies the circumstances in which a private summons may be refused and set aside and proceedings by that private prosecutor ended.
- As regards motive, Mr Darbishire submitted, public prosecutors are necessarily motivated by the public interest. No public prosecutor may bring a prosecution unless it is in the public interest. The question of motive identified in CrimPR r 7.2(14) does not arise in a public prosecution, and the abuse of process cases that concern public prosecutors are unhelpful in this regard.
- Finally, Mr Darbishire submitted that the undoubted discretion of the court to grant, refuse or set aside a summons sought by a private prosecutor is clearly defined. The Judge accurately stated the legal consequences of his finding on motive. His finding certainly fell within the scope of CrimPR r 7.2(14)(f). The prosecution lacked any true public interest rationale. The claimant's dominant motive was simply long-standing private antipathy towards the interested parties. It was therefore not the case that the Decision was wrong, or that any of the Judge's findings in his Judgment supporting the Decision was wrong or irrational.
Decision
- In my view, there is little, if any, merit in any of the five grounds advanced by the claimant.
- In relation to Ground 1, the Judge considered all of the material that had been provided by the claimant in support of his applications for the Summonses as well as the material produced by the interested parties in support of the application to set aside the Summonses, which, among other things, brought to the court's attention the evidence of the claimant's primary and improper motive that is summarised at paragraph 15 of the Judgment.
- It is not in dispute that there was a breach of the claimant's duty of candour, but the claimant says that it was irrational for the Judge to have concluded that the breach was deliberate. Having carefully considered the Judgment, I am satisfied that there was nothing irrational or otherwise unlawful about the Judge's conclusion that the claimant's breach of his duty of candour was deliberate. It was not good enough for adverse material to have been buried in the 800 or so pages of documents accompanying the claimant's applications for the Summonses. The Judge found that the claimant had failed to be transparent and had positively misrepresented the true position. He was entitled to reach those conclusions on the material before him. Ground 1, therefore, fails.
- In relation to Ground 2, for similar reasons, having carefully considered the Judgment and the other material provided by the parties for and against the claimant's application to quash the Decision, I am satisfied that the Judge's findings regarding the claimant's motive for bringing the prosecution were not irrational. In fact, it would, in my view, have been surprising, having regard to all this material, if the Judge had reached a different view.
- At [14] above, I have noted Lavender J's sole observation made when granting the claimant permission to apply for judicial review. Given that all five grounds are interrelated, it is not surprising that Lavender J granted permission on all grounds, having decided that there was a matter that justified scrutiny by this court at a substantive hearing, namely, the evidential basis on which the Judge reached his conclusion as to the claimant's motivation. Having had the opportunity of the substantive hearing to consider the evidential basis of the Judge's conclusion, I am satisfied that there is a proper one.
- I accept Mr Darbishire's submission that the Judge relied on an accurate precis of the underlying material in the defence skeleton argument and that therefore there is no substance in the claimant's assertion that the Judge's conclusion regarding the claimant's motivation lacked an evidential foundation. From the materials I have reviewed, it appears that the claimant does not dispute that the factual matters set out at paragraph 15 of the Judgment are accurately summarised. The claimant disputes that they provide a proper basis for concluding that his motivation in bringing the private prosecution was primarily to damage the interested parties, because those other matters occurred at earlier times in relation to other business dealings and so on.
- There was, however, nothing wrong, unlawful or irrational in the Judge reaching the conclusion he did reach about the claimant's motivation based on those matters. Nor was there anything wrong or irrational about the Judge drawing the conclusion that the claimant's failure to bring those matters (or, at any rate, an accurate and balanced account of the state of his relationship with the interested parties) clearly to the fore in connection with his applications for the Summonses was a deliberate breach of his duty of candour, sufficient to justify setting aside the Summonses.
- The Judge acknowledged that the fact that a private prosecutor had mixed motives for bringing a prosecution did not, of itself, render the proposed prosecution improper or an abuse of process. But there was an ample foundation in this case for the Judge's conclusion that the claimant's dominant motive was improper and therefore rendered the prosecution an abuse of the process of the court.
- For these reasons, Ground 2 fails.
- Ground 3 also fails for similar reasons. As the Judge noted in the Judgment at paragraph 40(xvii), the claimant brought this private prosecution. He could not "shy away from his legal obligations [in relation to disclosure and compliance with the duty of candour] by delegating to his solicitors". The Judge was satisfied that it was "abundantly clear that the prosecutor has failed to be frank in his case summary" submitted in support of his applications for the Summonses. To the extent that the claimant was pleading in aid disclosure by him that occurred after the Summonses were issued, the Judge correctly noted that his focus, for purposes of determining the interested parties' application to set aside, was the claimant's application for the Summonses.
- In relation to Ground 4, I accept Mr Darbishire's submission that the claimant's criticisms of the points relied on by the Judge to demonstrate the claimant's lack of integrity are not valid or do not go to the substance of those points. The Judge had a rational basis for his conclusion that there was a serious doubt about the integrity of the claimant and therefore his ability to discharge fairly, honestly, and objectively his obligations as a prosecutor and minister of justice. Ground 4, therefore, fails.
- Finally, in relation to Ground 5, given the failure of the first four Grounds, this must also fail. The claimant has failed to demonstrate that the Judge was wrong in law to conclude that his conduct in applying for the Summonses amounted to an abuse of process. For the reasons given by the Judge, he was entitled to set aside the Summonses given the claimant's failure to disclose information as to his true motive in bringing the prosecution and other relevant information material to the question of his suitability to act as private prosecutor in this case and given that his dominant motive, to damage the interested parties, would render the prosecution an abuse of process.
- For all these reasons, the claimant's application for judicial review of the Decision is refused.
