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Few litigation cases are dripping so sumptuously with fascinating facts as a case that incorporates abandonment of dishonesty allegations, an open offer to settle on a drop hands basis, admission of an untruth, witness credibility and errr bundles. It is all here and more …
Welcome to the case of DRSP Holdings Ltd & Anor v O’Connor & Anor  EWHC 626 (Ch). Ordinarily, a judgment of almost 350 paragraphs is typically one with guaranteed snooze potential but this one should keep you right on the edge of your seat to the very end. It is fascinating but not because of the comments about the litigation bundles.
Perhaps the incurious mind would not overlook the following from paragraph 147 of this case:
The Claimants have made an open offer to compromise the present proceedings on the basis of both the claim and the counterclaim being discontinued, and the parties bearing their own costs. It is the Claimants’ position that whilst there is merit in the claim, the costs of pursuing it to trial would be disproportionate to the amount of any damages that might be awarded.
In this case, the Claimants lost and a counterclaim appears to have succeeded. The Claimants did not succeed in their breach of duty claim because it appears such claims would have seemingly been rooted in the success of a claim for infringement database rights. As the infringement of the database rights claims seem to have been unsuccessful, the discrete issue of the breach of duty head of claim fell away:
It follows from the above that I do not find that any of the alleged acts of infringement of the Claimants’ database right has been established … Mr Moody-Stuart realistically recognised that these issues stood and fell with whether DRSP knew of and consented to the acts complained of, and thus that these further allegations could not succeed if the Claimants were unsuccessful in relation to their claim of infringement of database right. In the circumstances, it is neither necessary nor appropriate for me to deal with the further issues that arose in relation to the Claimants’ claims in respect of misuse of confidential information, breach of fiduciary duty, and breach of the terms of the Consultancy Agreement.
Those Litigation Bundles
Let’s get those litigation bundles out of the way. The judge, in this case, complained about the litigation bundles. He was particularly unhappy about the absence of a chronological bundle and directed that one be produced.
I mention these deficiencies in order to stress the importance, in cases such as the present, of there being a chronological bundle in a readily accessible format available for use by judge, advocates and witnesses in preparation for and at trial. The Chancery Guide, at paragraph 21.34 notes, that: “The efficient preparation of bundles of documents is very important. Where bundles have been properly prepared, the case will be easier to understand and present, and time and costs are likely to be saved. Where documents are copied unnecessarily bundled incompetently the cost may be disallowed.” The present case demonstrates how apt these words are. It may be necessary to revisit the suggested sanction in respect of costs in due course.
The importance of bundles perhaps cannot be underestimated and they certainly seemed to have had a material impact in this case given they were so notably highlighted at the beginning of the Judgment.
Indeed so important does it seem that bundles are, that they were referred to as a matter of some key significance by Edmund King QC in his article on “How To Lose A Case“. On bundles he had this to say in respect of their role as a factor in conceivably losing a case:
Be too grand to worry about bundles
Bundles are not glamorous. They are prepared by junior people who have a very difficult job: to work out what documents will turn out to be relevant at trial. Typically the person doing it has never even seen a trial before. Typically the silks and judge can see only after weeks of evidence what the few critical documents are. So if you don’t keep an eye on it, it’s pretty much luck what goes in and how it’s ordered. Get involved in the bundle preparation process. You need them early.
Format matters. If it’s not electronic, you can often merge/doubleside and shrink your papers. You will be quicker at finding stuff as a result.
The index will contain all sorts of long irrelevant words. Cut it down. Remove the heading so more of the info is on the first page. If you need to be looking something up on the index in court, it will be quicker. If up to 30 tabs, you can sellotape the index to the inside cover of the bundle so that when you’re talking to the judge and the file is open, you can see what tab you are going to. Redo all the spines of your bundles so you can see them all quickly. I have spent literally days redoing and remastering bundles before trials. It is never wasted time.
For electronic trials, it’s the same principles: make sure you have the right number of screens, the right processes for finding documents, the right people able to comment on your e-post-its. Have someone automatically bring up on a separate screen the document being shown to the witness so you can leaf through the full doc while following the questions on the particular page. Invest time in thinking ahead as to how you can be nimble in the court room.
If litigation bundles are of particular interest to you then perhaps check out Gordon Exall’s excellent blog which considers the bundle analysis in this case in his Civil Litigation Brief. There are a few words of wisdom there:
If you thought that electronic bundles were the panacea that was going to put an end to the numerous posts on this blog recording (largely) judicial criticisms of bundles, think again.
Assessment Of Witnesses – Breach Of Duty Litigation
A feature of the case was the nature of the control or otherwise over the Claimants exercised by an individual called David Mond. Mr Mond disputed that he had any interest in the Second Claimant, DRSP Limited.
The judge kicked off with the notably common reference to Gestmin SGPS SA v Credit Suisse (UK) Ltd & Anor  EWHC 3560 (Comm) about the unreliability of memory but in doing so made the following useful statement:
I do, however, take into account the importance stressed by the Court of Appeal in Kogan v Martin  EWCA Civ 1645 at  of making findings by reference to all the evidence, that is both documentary evidence and witness evidence, placing such weight as the circumstances require on each. Further, in testing what has been said by a witness, it is plainly appropriate to do so as against the inherent probabilities of the relevant situation, and considerations such as the consistency (or otherwise) of a particular witness’ evidence with other evidence, the internal consistency of that evidence, and the consistency of that evidence with what the witness might have said on other occasions – see Kimathi v The FCO  EWHC 2066 (QB), at .
It was notable that one of the Defendants, Thomas O’Connor, had admitted to having told a concerning untruth in the past but whilst the judge recognised the serious issue, it does not appear that it was held against him because it seems the account afforded by the Defendant was consistent with contemporary documents. The judge said:
I detected no significant inconsistency between his evidence and the documentation before the court relating to the key events as they unfolded in 2018.
Consequently, to the extent that there is any inconsistency between the evidence of Mr Mond and Mr O’Connor, I prefer that of Mr O’Connor.
However, the judge did find that he had exaggerated in his evidence:
So far as exaggeration is concerned, reference was made by the Claimants to paragraph 111 of Mr O’Connor’s witness statement in which he had referred to Mr Mond having stated in earlier proceedings that he was: “an old man, easily confused and frequently suffers memory lapses”. The decision of the relevant tribunal dating back to 8 June 2011 referred to the fact that, in order to explain delay in bringing a tax appeal, Mr Mond had, amongst other things, relied upon the fact that he “suffers health-wise and has lapses of memory.” It was put to Mr O’Connor in cross examination that he had deliberately exaggerated and distorted what the tribunal had relied upon, and done so to “further your own litigation aims and criticise Mr Mond”.
Mr O’Connor’s response to this line of enquiry was not entirely satisfactory, but I am satisfied that he was not, in any sense, seeking to mislead this court. To the contrary, the impression that I get is that he does feel genuinely frustrated and exasperated by the claims that have been brought against him, including the allegations of dishonesty and lack of good faith that have not been pursued, which he sees as an attempt by Mr Mond to bully him, and a sense of grievance has caused him, on occasion, to exaggerate matters. I bear this in mind when considering the overall reliability of his evidence.
The judge said he did not find Mr Mond to be a satisfactory witness:
Firstly, I do not accept his evidence that he was simply a consultant to DRSP, and that Mrs Robinson is the true owner of the business without him having any other stake or interest therein
He expressed “some concern” that matters might have been arranged in relation to the ownership of the Second Defendant for regulatory purposes:
In my judgment, matters can only have been arranged in this way in order to create a false impression to regulators and others who might be concerned in relation thereto, that Mrs Robinson was the owner and directing mind of DRSP when, in fact, that was not the case. I do not accept the explanation concerning emails given by Mr Mond in paragraph 8 of his witness statement. Likewise matters such as the preparation of minutes show Mrs Robinson (and not Mr Mond) to have attended meetings when, in fact, it was Mr Mond who attended the meeting as the active participant.
A notable feature of this case was the abandonment of the Claimant’s suggestions about dishonesty and bad faith by the Defendants shortly prior to trial:
It is fairly clear that Ms Taylor, with her unfortunate dependency on alcohol and the effects thereof, was not in a good place in late August/early September 2018, and her email correspondence on 23 and 24 August 2018 is surprising as to her apparent lack of knowledge that DRSP had reached any agreement at all with Mr O’Connor/Octax with regard to the passing of closed or uncontactable cases to Octax. Further, it is apparent that with Ms Taylor’s illness and absences, perhaps contributed to by Mr Mond’s own absences and medical issues at the time, the operation of DRSP had, despite offers by Mr O’Connor to help out, become somewhat dysfunctional with the loss of a number of key staff. To my mind, it does Mr Mond little credit that against this background he was prepared, through the present proceedings, and in remarks made to others such as Mr Lee and Ms Jordan, to accuse Mr and Mrs O’Connor of dishonesty and lack of good faith, when there was simply not the evidence to support these allegations, which have been abandoned shortly before trial.
Further, I am satisfied, not least from what he said during the course of the exchange with Ms Jordan on 19 October 2018, that a significant factor behind the decision to seek to challenge Mr O’Connor’s actions, and to do so making unfounded allegations of dishonesty and lack of good faith, was at least in part motivated by the fact that Mr Mond was aware that DRSP was potentially liable to pay very significant sums to Octax in the form of commission as discussed at the meeting between Mr Mond and Mr O’Connor on 18 July 2018, and a perception that attack was the best form of defence.
The Meeting On 19 October 2018
The judge found this meeting important:
It is necessary to refer to a meeting that took place on 19 October 2018 between Mr Mond and Ms Jordan, a recording of which was made by Ms Jordan, and which has been transcribed. By this stage issues had arisen concerning Mr Jordan’s employment by DRSP, and the amount that was to be paid to Ms Jordan on the termination of her employment. Whilst the transcript does require to be read as a whole, the following matters stand out:
144.1. At one stage Mr Mond said to Ms Jordan: “Let me caution you. There’s a big civil action against Tom, right? The police have been advised, right, LB criminal actions, and anybody who’s helped the … So it’s best to be truthful ”.
144.2. Towards the end of the meeting, the following exchange took place:
“David Mond Yeah? But when you find out, if I’m wrong, I’ll apologise to Tom, and he gets a million pounds, he gets £2 million, he can get £10 million, whatever massive claim you think he’s going to bring against me. It doesn’t matter, I’ve got the money to give him. And Liz will tell you because she’s worked with me now for how many years? Liz Robinson 27 David Mond 27 years Rebecca Jordan Well done! David Mond Right? I’m a man of principle, and I don’t let anybody take the piss out of me. Rebecca Jordan Yeah. Oh, no, I know. I already know that.”
Following this meeting, by an email dated 26 October 2018, Ms Jordan wrote to Mr Mond in the following terms:
“On Friday you came across in a very unprofessional manner and at the end of the meeting I had no doubt that any further payment was going to be incumbent upon my bearing false witness in your frivolous claim against Tom O’Connor.
I expected so much better from someone of your years and experience and the repeated willingness demonstrated to lie about insignificant details to fabricate a ludicrous chain of events only served to highlight your desperation.
I came into your office to help you on Friday despite the way you treated me … “
Attack Not Always The Best Form Of Defence – Breach Of Duty Litigation
It would seem from the meeting referred to above that the judge seems to have interpreted the case somewhat as follows:
I am satisfied, not least from what he said during the course of the exchange with Ms Jordan on 19 October 2018, that a significant factor behind the decision to seek to challenge Mr O’Connor’s actions, and to do so making unfounded allegations of dishonesty and lack of good faith, was at least in part motivated by the fact that Mr Mond was aware that DRSP was potentially liable to pay very significant sums to Octax in the form of commission as discussed at the meeting between Mr Mond and Mr O’Connor on 18 July 2018, and a perception that attack was the best form of defence.
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