KB-2023-003510 - [2025] EWHC 1755 (KB)

For those reasons, the material paragraphs of the Particulars of Claim will be struck out.

I now have to deal with claims to strike out further parts of the Particulars of Claim, or for clarification as to the implications for other parts of the Particulars of Claim, having regard to the paragraphs that have already been struck out. The matters that fall for consideration under this limb of the Defendants’ application relate to allegations against the Second, Third and Fourth Defendants.

The way in which the matter is argued in respect of the Third Defendant, Mr Kissane, and the Fourth Defendant, Ms Wells, is that upon review and analysis of those paragraphs that have already been struck out on discrete grounds under the various headings that I have dealt with in the rulings that I have given so far, all the substantive allegations against Ms Wells and Mr Kissane have already been resolved and resolved in the Defendants’ favour, that is to say they have been struck out.

So far as Ms Wells is concerned, Mr Dowding, I think rightly, is prepared to concede that that is so, and he does not pursue resistance to Ms Wells being removed from allegations in the Particulars of Claim and indeed, as a corollary of that, removed as a Defendant in the proceedings, and I so rule in favour of the Defendants.

So far as Mr Kissane is concerned, Mr Dowding does oppose the order that the Defendants seek. But having looked at it more than once in the course of counsel's submissions and having reminded myself of the ambit of what has already been struck out under my earlier rulings, I consider that Mr Laddie is right in his submissions. In fact, when one goes over the Particulars of Claim, all the allegations of substance against Mr Kissane have already been resolved and dealt with in the Defendants’ favour, under other heads. In other words, it is not a question now really of striking out anything extra as against Mr Kissane in addition to the paragraphs or parts of paragraphs that have already been struck out, but of taking stock of what has been struck out and confirming, as I think is right, that the effect of that is that there is no substantive claim left in the Particulars of Claim against Mr Kissane, and as a corollary of that, and I agree with this, that Mr Kissane also must be removed as a Defendant.

The position so far as the Second Defendant, Mr Shah, is concerned is different, and it is accepted by the Defendants that the rulings on other heads have not produced the result that all the allegations against Mr Shah have already been dealt with. But, in the round, the Defendants’ submission is, first of all, that the Employment Tribunal was seized of a wide ranging case of unfair dismissal and complaints of acting to the detriment of Mr Dowding in the employment tribunal hearing. At the heart of all of that was an exploration of the role and actions of Mr Shah, because inevitably the employer company as a fictitious legal person can only act through the agency of individuals, and the prime agent for these purposes was indeed Mr Shah. The way in which the Defendants’ argument is put is that, if you look at the Tribunal’s far-reaching rulings, they have already effectively dealt with the allegations of misconduct and so forth against Mr Shah, because that was at the heart of the debate and the issues in the employment tribunal, and it is clear from their rulings and their detailed reserved judgment that they rejected both the claims made and the criticisms of Mr Shah.

I believe that in some instances Mr Laddie would be inclined to accept that the Tribunal did not in terms deal with some allegations. It might have been open to the Defendants to argue that to the extent there were extra allegations that the Tribunal did not deal with, they are all allegations which could and should have been brought as part of Mr Dowding’s unfair dismissal claim and, therefore, the Claimant, Mr Dowding, should not be allowed to bring them afresh in the High Court, when they properly belong to the subject matter of his already disposed of unfair dismissal claim. But that is not a point that has been made, or at least pressed, by the Second Defendant.

Rather, the Second defendant invites me have regard to the summary of the law that is contained in Clerk & Lindsell at paragraphs 23-44 and 23-45. Essentially, this is exploring the ambit of the law which flows from what was said in Said v Butt [1923] KB 497. What is stated there as being one of the consequences of the rule generally referred to as the rule in Said v Butt is that where the defendant is an employee or agent of the party who breaks the contract, ie typically the employer, the rule is that:

“An employee acting bona fide within the scope of his authority is not liable for procuring the breach of contract made between his employer and a third party. He is treated as the alter ego of the employer.”

The position, therefore, in accordance with that summary of the law, for an employee or an officer to be independently liable for procuring a breach of contract by the employer company, the employee or director must have acted in bad faith and/or outside the scope of his authority.

The broad point that is put in the present case is that there is nowhere pleaded in the Particulars of Claim, and nor could it reasonably be pleaded in light of the findings in particular of the tribunal, that Mr Shah did anything wrong in either of these senses.

One can explore some aspects of that debate by looking at paragraph 146 of the particulars of claim which pleads: “Without consulting the Claimant, Mr Shah, during the contractual notice period, cancelled the Claimant’s private medical cover in circumstances where he was fully aware that the Claimant might have cancer...” and then these are the words that follow that are sought to be struck out: “... and after he had procured the Company to breach the Claimant's contract by relying on a noncontractual PILON (i.e. Payment in lieu of notice) …”

Now, the issue of whether there was a noncontractual payment in lieu of notice does not seem to me, on the material I have seen, to have been raised as a discrete allegation in front of the Tribunal. But what is said by the Defendants is that alleging that Mr Shah procured the company to breach the contract by relying on that is really not an allegation that can be allowed to go forward in light of the history, the findings of the Tribunal and the fact that, looked at more broadly, really it would add nothing to the Claimant's claim in light of the fact that he has a raft of claims against the company, essentially breach of contract claims, which they accept can go forward.

Mr Dowding’s main argument is that this alleged action by Mr Shah, and, indeed, other actions on his part which are reflected in paragraphs 158, 159, 165, 170, 171, 179, 180 and (under the damages head) in the introduction to paragraph 214 and in sub-paragraphs 214 (viii) to (x), all reflect breaches of duty on the part of Mr Shah, contrary to section 172 of the Companies Act. That is enough, either by itself or in conjunction with the actions of Mr Shah which are said to be relevant to the breaches having arisen, to give rise to arguable claims of procuring a breach of contract.

The submission Mr Dowding makes is founded principally on the case of Antuzis v Houghton Catching Services Ltd and Others [2019] BLR 1532, a decision of Lane J.

The reference to section 172 of the Companies Act 2006 occurs at paragraph 118, where the learned judge sets out that this section imposes important duties on directors to act in good faith so as to promote the success of the company and in so doing to have regard to various matters. The matters listed in the section include:

“The likely consequences of any decision in the long-term … the interests of the company’s employees … the impact of the company’s operations on the community and the environment … the desirability of the company maintaining a reputation for high standards of business conduct.”

For good measure, I point out that the judge goes on to say that section 174 imposes a duty on directors to exercise reasonable care, skill and diligence.