Haastrup & Anor v Haastrup & Anor

LORD JUSTICE BEATSON: This is a renewed application for permission to appeal against the order of Mr John Jarvis QC, sitting as a Deputy High Court Judge, sealed on 22 April 2015, after a hearing on 16 April. The Deputy Judge dismissed an application to discharge a freezing injunction made by Barling J after a without notice hearing on 2 April 2015.

The circumstances of the hearing on 16 April are at the core of this renewed application and I will return to them. Permission to appeal and a stay of execution were refused by Lewison LJ on 21 May 2015. In matters unrelated to this application, on 13 November committal proceedings were instituted for non-compliance with the freezing injunction, in particular the order to disclose information.

The underlying dispute is between members of the family of the late Captain Israel Ademola Haastrup, who was the sole owner and director of the second applicant, Universal Trading and Shipping (UK) Limited. He died in October 2012. It appears that the company was struck off the Register of Companies at some time and restored to the Register in March 2014. The first applicant, John Adewale Haastrup, is Captain Haastrup's eldest son. He claims to have become the sole shareholder and director of the second applicant inter alia by virtue of letters of administration granted to him by the High Court in Abuja Nigeria. There is also apparently litigation in Nigeria as to who the administrator of Captain Haastrup's estate is.

The freezing injunction restrained the applicants from disposing or in any way dealing with the proceeds of a cheque in the sum of £282,474.09 payable to Universal Trading and Shipping (UK) Limited and sent on 17 September 2014 by HMRC to Alpha Rocks solicitors. Alpha Rocks was the solicitors of John Adewale Haastrup and the company. The money was the balance of the proceeds of the sale of a property in Essex owned by the company. The property had been sold on the instructions of HMRC in connection with the payment of tax due. The freezing injunction also contained consequential orders. In particular, Clause 6 required the applicants to disclose information about the money, bank accounts in which it was or had been held, and what happened to it. The provision of information is, as Mr Morrell accepted this morning, an absolutely standard feature of any freezing injunction.

The freezing injunction was obtained by Gloria Ngozi Haastrup and Emmanuel Ademola Haastrup, the respondents to this application. They claim that they are beneficiaries of Captain Haastrup's estate. Gloria was Captain Haastrup's wife until 2007 but her status since then is disputed. The dispute is as to whether the marriage was "reconstituted" because she reconciled before a divorce decree became absolute. Emmanuel Ademola Haastrup is Captain Haastrup's son by a former marriage and John Adewale Haastrup's younger brother.

On 10 April, the applicants (i.e. John Haastrup and the company) applied to discharge the injunction on the basis of material non-disclosure by Gloria and Emmanuel (who, as I have said, are the respondents to this application). The basis of the application to discharge is that Gloria, the first respondent, was not the widow of the deceased as she claimed and was not a beneficiary of his estate and had no interest in the matter; and that the second respondent, Emmanuel, is not capable of bringing the application because of his mental state. It is claimed that Gloria sought to use Emmanuel to give her claim some legitimacy. Particular objection is made to Clause 6 of the injunction, which requires the applicant to provide information as to the whereabouts of the £282,474.09 and how it had been dealt with since its receipt.

I interpose that Mr Morrell informed the court this morning that in fact very little of it is left.

The subsequent progress of these proceedings has not been straightforward. The parties believed that the return day of the freezing order was 14 April but the court had not listed it on that day. Arnold J varied the order so that the return day and the hearing of the application to discharge the injunction would be 16 April. On the morning of 16 April, substantial documentation concerning the status of the marriage and Emmanuel's capacity was filed by the applicants in support of their application to discharge the injunction. There was also a dispute raised by the respondents as to whether the first applicant, John Adewale Haastrup was entitled to administer the estate. It appeared that a day's hearing would be needed to resolve these issues.

The matter came before Mr Jarvis in the afternoon. Although the applicants were not happy for the injunction to continue until the matter and the disputes could be heard on proper notice (see page 1, lines 33 to 36 of the transcript), the earliest that there could be a hearing on Gloria's position was the following week. A hearing in which evidence would be taken on Emmanuel's capacity would have to be later than that. On the basis that all that was needed at that stage was a prima facie case that there was an entitlement to apply for the freezing injunction (see the transcript page 2, lines 34 to 35), the Deputy Judge stated (page 7, lines 2 to 4) that all he was concerned with was to preserve the money pending the determination of the other questions. The discussion between the Deputy Judge and Mr Ogunbiyi (who was representing the applicants) then turned to consideration of that (see transcript page 8, lines 9 and 14 to 18; and pages 11 to 12, lines 39 to 43). The Deputy Judge asked whether there was any reason why the money should not be preserved pending the trial. In the last of those references he stated:

"But for the moment we are in a position where we are just protecting the position, holding the ring and one of the ways you have to do that is to know where is the money that is being protected, where it is held? This is an absolute standard form order the court makes ... "

Consideration was also given to varying the freezing order in order to enable the second respondent to carry on business and pay legal expenses (see page 8, lines 9 to 13, 16 to 20, 25 to 28 and 38). As to this, Mr Ogunbiyi said, "That would solve that" (i.e. permitting the use of the money for the ordinary course of business and legal expenses). Crucially (at page 10, lines 9 and following), Mr Ogunbiyi said that he would be content for the order to continue until the trial if it was amended in that way. The Deputy Judge said (at lines 16 to 18):

"That really shortens everything, so we do not have a wasted hearing next week and I think what you have to do is get on and get the pleadings done and get ahead of this one. Would it be sensible to make some directions?"

As to the provision of information (I have referred to the judge's observation that this was an absolutely standard provision), the judge explained (at page 13, lines 1 to 6) that the submission that there was no obligation to provide the information once an application to discharge the order was made on the true construction of Clause 6 of the order was a misconceived submission. The judge said, referring to Clause 6:

"It may not be very good drafting, but what this means is that if an application is made to discharge the obligation to do this is suspended pending that determination. The order is actually going to be continued so you should now supply this information and that will be part of the order and the question is: how long you want to do that?"

The judge said he did not see why that could not be done within 7 days. There was then an exchange in which Mr Ogunbiyi said: "If my Lord says that is the meaning of the order, then obviously we will seek to try and ... ". The judge then said: "It is a very simple thing to do", and Mr Ogunbiyi said, "Yes, my Lord, I understand", to which the judge responded, "So there is no doubt, it will appear as now an obligation to supply it. Mr Ogunbiyi said, "My Lord, yes. My concern, though, is that we are being forced to supply information to a party who we strongly believe, prima facie, is not entitled to it and we are very concerned about her motives for bringing this application in the first place". The judge then said that he understood that but he did not see how that (which must be a reference to the obligation to supply the information) prejudiced Mr Ogunbiyi's clients.

Matters then turned to Mr Emmanuel Haastrup's mental health. What is clear from page 13, lines 1 to 7, is that if the order continued there would be an obligation to supply the information. The order that was drawn up and sealed after the hearing dismissed the application to discharge the freezing order.

Mr Morrell submits this morning that the learned Deputy Judge made three errors. First, he adopted a wrong approach to the allegation that there was a failure on the part of those who had obtained the freezing injunction to make proper disclosure. Secondly, his approach to the application to discharge was wrong. It was wrong to dismiss the application to discharge the injunction rather than to adjourn it. He should, submitted Mr Morrell, have held the ring until the underlying claim was determined. Any agreement by Mr Ogunbiyi was to the continuation of the injunction and not, as Lewison LJ had stated when refusing permission, to the provision of the information. Mr Morrell submits that Lewison LJ erred in regarding the applicant's present stance as resiling from the position their counsel took at the hearing.

Since the hearing before the Deputy Judge, attempts to get the required information continued over the summer. The applicants were told from early June that the respondents would make an application for their committal. The applicants asked for a deferral of that until this renewal hearing. It is said that there has been no response to letters from the respondents asking for the name of the solicitor at Alpha Rocks with conduct of the matter. As I have stated, the committal proceedings were instituted on 13 November. Then came before Nugee J on 1 December. Nugee J gave directions for the service of affidavit evidence in response and that the hearing date be the first available date not before 15 December but save for one excluded date to be before the end of term. As Mr Morrell informed me, the money is no longer there.

In my judgment, there is no arguable ground for considering that there would be success in any appeal against the order of the Deputy Judge. It may be that Mr Ogunbiyi did not agree that the obligation to provide the information should continue and it may be because the judge cut him off at page 13 when he said, "obviously we will seek to try and ... " that he was not stating that he accepted that the order would be complied with. What was, however, absolutely clear was that it was accepted that the injunction would continue on an interlocutory basis until the underlying disputes were resolved and the judge was crystal clear that that meant that the obligation to supply the information would continue. So whether counsel accepted the order, whether or not he stated the order would be complied with, that was the order.

I turn to the suggestion that the application to discharge the injunction should not have been dismissed but adjourned. Once it had been decided that the right thing was to preserve the ring until the underlying dispute could be determined, it followed that the injunction should continue. Mr Morrell has not made any argument to say that the injunction should not have been continued. In those circumstances, the attempt to hive off the obligation to provide information in the way that has been done is utterly misconceived.

For these reasons, I reject the submissions that are made and refuse this renewed application.