CA-2025-000010 - [2025] EWCA Civ 933

The Trustee sought to defend the judge’s decision on the basis that, in context, his reasons were sufficient. It was a ruling on a short application in the Friday Commercial Court list. It could reasonably be inferred that the judge had in mind the points that had just been argued before him. The judge had made it clear that the ruling was not “self-contained”, and had expressly referred to the decisions of Bright J and Robin Knowles J as well as the Trustee’s skeleton argument. There was no complaint about lack of reasoning at the time because the judge’s fundamental reasoning was well understood.

I fully appreciate the significant challenges faced by judges dealing with a busy interim applications list. I would add that the practical problems are often increased by unrealistically low time estimates by the parties (albeit that that does not seem to have been a problem in this case). A robust approach is often required, and reasoning will almost inevitably be more compressed than in other circumstances. Summaries of background facts and uncontroversial legal principles may need to be omitted, or at least significantly trimmed.

However, there is a minimum level of reasoning that is required. The critical elements of the judge’s decision-making must be recorded, such that the parties understand why the decision was reached. I would add to this that, for obvious reasons, it is usually especially important that the losing party understands why their case was not accepted. Further, the judge should bear in mind that a judgment must be understandable not just to the parties but to an appeal court. The reasons must be “sufficiently apparent to enable the appeal court to uphold the judgment”: English v Emery at [18].

In this case I am unable to accept that the judge’s decision contained adequate reasoning. While some elements can be discerned there is simply not enough there to explain the result to the parties or this court. In particular, and even taking account of the transcript of the hearing (which I have read), there is very little engagement with Xinbo’s case as the losing party, beyond references to “surreality” and “scepticism”. The references to the judgments of Bright J and Robin Knowles J do not plug the gap without further explanation. For example, although the judge referred to Xinbo’s procedural behaviour as not being as poor as Dynamic’s, he did not really explain why it was nevertheless in the interests of justice to require a payment into court, or one that was higher than had been required by Bright J from Dynamic, or to impose an additional condition relating to the return of the Unpledged Shares, effectively stipulating for the satisfaction of Robin Knowles J’s later summary judgment. The reference to the need to protect the “dignity of the court process” provides a hint, but it is not enough and it does not address Xinbo’s arguments.

In these circumstances I have concluded that the judge erred in failing to provide adequate reasoning. However, that is not the end of the matter. Neither party suggested that we are not equipped to reach our own conclusions. We heard a full day’s argument, which is considerably more than the judge, and have been taken through the background and the parties’ cases in detail. A remittal would involve further delay and unnecessary expense. This is a case where we can and should reach our own decision.

Before leaving the topic of inadequate reasoning, I will draw together some threads from the authorities and comment on how they may be applied in the context of an interim application or case management decision such as this. These points should come as no surprise to experienced judges, but they may assist those at earlier stages of their judicial careers: