CH-2024-000151 - [2025] EWHC 2604 (Ch)

There are two principal abuse points arising on this appeal. The first is one arising out of one of the bases on which the judge seems to have decided the point, namely that the decision in Rexhaven rendered Investments’ proceedings an abuse. The second, which arises more out of the respondent’s notice, is one which arises out of what are said to be close links between Greenland and Investments through the instrumentality of Mr Halabi, and an allegation that it would be wrong to allow Investments to be used as a vehicle for prolonging harassing and oppressive litigation.

In paragraph 48 the judge below seems to have considered that the abuse point arose out of the learning in Rexhaven. It would seem that he considered that what Rexhaven decided rendered MGIL’s claim an abuse. At paragraph 22 HHJ Murch asked the question: “What then is the test when a chargee seeks to set aside an order”, and answered it by considering Rexhaven. His decision was, in effect, that since a mortgagee had to apply to get the possession order set aside, and since it had not done so and would not be able to do so (see Rexhaven), the application was an abuse of process.

In the light of my decision on the summary judgment aspects of the case this point does not arise. Briefly stated, the reasons for that are as follows. Rexhaven was a case in which the relief proceedings did not start until after the landlord had executed a possession order against the tenant, so in order to get a relief claim off the ground the mortgagee had to apply to get the possession order (and thus the execution) set aside. The application failed on the merits and HHJ Colyer QC made remarks as to the difficulty faced by any mortgagee in applying to set aside the possession order after it had been notified of the proceedings earlier. It seems to be that learning that HHJ Murch applied in this case. Since I have decided that technically it was not necessary to undo the possession order (to put the situation back into one in which the landlord is “proceeding”) in this case the point does not arise, though had it been necessary to decide the point I would have considered that the judge’s overall decision on this point was one he was entitled to reach.

The other abuse of process is said to arise from evidence which should have led the court conclude (in the words of the respondent’s notice):

“ … that the Claimant, directed or influenced by Mr Halabi, cynically took the decision not to intervene in the forfeiture proceedings so as:

(i)

to avoid liability for the many adverse costs and mesne profits orders previously made against Mentmore Golf Corporate Ltd and MGL; and

(ii)

to provide Mr Halabi with a second opportunity to claim relief from forfeiture in the event that possession was ordered and relief refused in the forfeiture proceedings, without complying with those costs and mesne profits orders; and

(iii)

the evidence showed that the Defendant was significantly prejudiced by the prolonged uncertainty in relation to the right to possession of the demised land, which was sterilising its beneficial use and causing the Defendant to incur costs.”

The judge below made no detailed actual findings about this in his main judgment (though see below as to his findings on an application for a third party costs order), though he did refer to relevant authorities on the point, but both parties to this appeal agree that he accepted submissions from Ms Wicks which averred that the facts showed a relationship between them to which one could not close one’s eyes (paragraph 41). That seems to be the farthest that he went. The real meat of this part of this appeal is raised by the respondent’s notice and the submissions made under it.

The relevant law on this topic was not in dispute between the parties. The starting point is the speech of Lord Bingham in Johnson v Gore-Wood & Co [2002] 2 AC 1. At page 31 Lord Bingham expressed the broad nature of the consideration as to whether or not conduct was an abuse of process:

“But Henderson v Henderson abuse of process, as now understood, although separate and distinct from cause of action estoppel and issue estoppel, has much in common with them. The underlying public interest is the same: that there should be finality in litigation and that a party should not be twice vexed in the same matter. This public interest is reinforced by the current emphasis on efficiency and economy in the conduct of litigation, in the interests of the parties and the public as a whole. The bringing of a claim or the raising of a defence in later proceedings may, without more, amount to abuse if the court is satisfied (the onus being on the party alleging abuse) that the claim or defence should have been raised in the earlier proceedings if it was to be raised at all. I would not accept that it is necessary, before abuse may be found, to identify any additional element such as a collateral attack on a previous decision or some dishonesty, but where those elements are present the later proceedings will be much more obviously abusive, and there will rarely be a finding of abuse unless the later proceeding involves what the court regards as unjust harassment of a party. It is, however, wrong to hold that because a matter could have been raised in earlier proceedings it should have been, so as to render the raising of it in later proceedings necessarily abusive. That is to adopt too dogmatic an approach to what should in my opinion be a broad, merits-based judgment which takes account of the public and private interests involved and also takes account of all the facts of the case, focusing attention on the crucial question whether, in all the circumstances, a party is misusing or abusing the process of the court by seeking to raise before it the issue which could have been raised before.”

The principle is not confined to a situation where the party against whom abuse is alleged is the same as a party to the preceding litigation, or even that there is some close degree of identity. This was made clear in Aldi Stores Ltd v WSP Group plc [2008] 1 WLR 748 where Thomas LJ rejected a submission (recorded at paragraph 7) that there had to be a “sufficient degree of identity” between the two parties in question.

“10.

I cannot accept this argument. Lord Bingham made clear in his speech that the approach should be a broad merits-based judgment and not formulaic. It is clear he was approving the passage in the judgment of Megarry V-C as the correct approach and not as a statement of rigid application. The fact that the defendants to the original action and to this action are different is a powerful factor in the application of the broad- merits based judgment; it does not operate as a bar to the application of the principle. This was plainly the view of Clarke LJ in Dexter’s case [2003] EWCA Civ 14 at [49]—[53] in the passage I have set out with which I agree.”

From time to time Ms Wicks submitted that the history of this litigation demonstrated what she described as harassment. If true then that would be a relevant factor (if associated with the relevant parties), as is apparent from the Dexter decision cited by Thomas LJ:

“(vi)

The court will rarely find that the later action is an abuse of process unless the later action involves unjust harassment or oppression of B or C.” (para 49).

Ms Wicks also drew attention to the point that it was irrelevant whether the earlier proceedings resulted in a final judgment on the merits - see for example Harbour Castle Ltd v David Wilson Homes Ltd [2019] EWCA 505 where the preceding action was struck out for a failure to provide security for costs which had been ordered. That case also demonstrates that it may be particularly relevant that the first action was struck out for failure to comply with peremptory orders - see paragraph 9, though it should be noted that the second claim in that case was brought by the same claimant as the first (which is not the case here).

Against that background I can now move to consider the alleged abuse in this case.