Ghadami v Bloomfield & Ors

It is necessary to begin by setting out the tortuous tale out of which the appeal and applications before me arise in this claim for £100 million. The account is drawn from material provided by Mr Ghadami (principally his Particulars of Claim and annexures, some 475 pages in length). These Particulars of Claim are most certainly not a concise statement of the facts on which Mr Ghadami relies; indeed as the Master observed “it is difficult to form any coherent picture of events from the Particulars of Claim”. What follows is a description of the origins of the litigation: and of the part the many defendants play. It does not involve any findings of fact (although I shall refer to documents that are not in dispute).

So tortured is the tale I should provide some signposts. Mr Ghadami participated in some speculative property ventures. He negotiated for himself some benefits even if the venture did not succeed. There were changes in the benefits and there were changes in the source of the benefits. As to the benefits Mr Ghadami says he was promised 4 properties in London W1. As to the source of the benefits, Mr Ghadami says that although nominally promised by one person, the promise was really made by others: and yet other people (who became involved in the sale and purchase of the 4 properties) are liable to him for the fact that the benefits have not been received.

Mr Ghadami owned some land in Harlow. In 2005 he became involved with Mr Fincken (D10) (who represented North Western Estates plc (“NWE”)) in a proposal to redevelop Harlow centre. A Joint Venture Agreement was signed in April 2005 between Mr Ghadami and NWE. Mr Ghadami was going to sell

Then Mr Bloomfield (D1)(who Mr Ghadami says is simply a “front man” for and agent of Jan Bonde Neilsen (D4) and Saif Durbar (D6), but has been described in the property press as “the veteran property dealmaker” and “one of the best-known property dealmakers of the 1980s”) proposed a different joint venture (which it appears was to supercede the NWE joint venture). On 7

Mr Ghadami says that in connection with this joint venture he entered into yet another agreement, this time with Mr Bloomfield personally entering the primary payment obligations. This was a Management Agreement dated 17 December 2005 (“the 2005 Management Agreement”). It recorded an obligation on the part of Mr Bloomfield to pay £6 million to Mr Ghadami at a convenient time (apparently out of Blackraven’s share of the development profits): and Mr Bloomfield was to provide 100% of the funding requirement for the purchase by Mr Ghadami of a property in Hertfordshire (for £11 million), a flat in Mayfair (either at 3 Belgrave Place or 17/18 Upper Grosvenor Street) (for £5 million) and a villa in Spain. If the redevelopment project was successful then the funding would be repaid out of Mr Ghadami’s share of the development profits. If it was not, then Mr Ghadami would not have to pay anything by way of discharge of the funding (so getting property worth £16 million plus for nothing). The document itself says that it was “signed and agreed irrevocably by Mo & PB, agreed over a period of a few months in 2005”.

Paragraph 34 of Mr Ghadami’s Particulars of Claim (in its revised form)

Then on 13 January 2006 there was a “Memorandum of Agreement to reflect Breach of Contract of Blackraven Developments Ltd”. This confirmed the obligations of Mr Bloomfield (including an oblique reference to the 2005 Management Agreement but without mention of any oral variation) and added to them.

One month later on 12 February 2006 Mr Bloomfield signed a Promissory Note (“the 2006 Note”) whereby he conditionally promised to pay £24,350,000 to Mr Ghadami on 30 June 2007 plus interest and associated costs. This appears to have been an estimate of the sum total of the obligations which Mr Bloomfield and Blackraven had entered into with Mr Ghadami. The 2006 Note is not sued upon.

Mr Ghadami says that later in 2006 Mr Bloomfield informed him (i) that in June 2006 he had acquired 42 Upper Grosvenor Street and 42 Reeves Mews (ii) that if those properties were to be sold then Mr Bloomfield would be entitled to “a 25% commission of the sale price” (iii) that Jan Bonde Neilsen would receive 50% and Saif Durbar the remaining 25%. He says that Mr

In fact, says Mr Ghadami, the true position was that (a) Festio Investments Ltd

First, on 9 February 2007 Mr Rhodes (D7) (who was concerned in the management of Festio’s affairs) gave an undertaking to some solicitors (“M”) that out of the proceeds of sale the sum of £100,000 would be put on one side to be held to the order of Mr Ghadami and Mr Bloomfield. Mr Ghadami says that in the following month (and before any sale) £100,000 was sent to M by Beacon Industries Corporation (D15) (a company which Mr Ghadami says is in the legal ownership of Mr Rhodes and Mr Bakhda (D8) but under the control of Jan Bonde Neilsen) with instructions from Mr Bloomfield to send it straight to Mr Ghadami. Mr Ghadami received it on 15 March 2007. So Mr Ghadami got £100,000.

Second, Mr Ghadami says Jan Bonde Neilsen promised to give him the commission that was supposed to go to Mr Bloomfield. So far as I can tell the case is that this promise was made in a telephone conversation in March 2007: but otherwise the circumstances are not spelled out. It is not said that Mr Bloomfield was party to this agreement (and he subsequently made promises inconsistent with it, since they proceed on the footing that he was still entitled to the commission).

At all events, notwithstanding (i) Mr Bloomfield’s promise to share his commission, (ii) the actual payment of £100,000 arranged by Mr Rhodes, and

In support of that legal claim to an interest deriving from an estoppel Mr Ghadami referred to the Blackraven Agreement, the 2005 Management

Larios Properties Limited (D11) was at this time the registered proprietor of 42 Grosvenor Street. It was in negotiation to sell 42 Upper Grosvenor Street and 42 Reeves Mews. Mr Ghadami says that the controlling minds of Larios must be either Jan Bonde Neilsen or Saif Durbar. Mr Saunders (on its or their behalf) sought cancellation of the unilateral notice by an application dated 27^th of March 2007.

Mr Ghadami says that in order to secure his cooperation in removing the unilateral notice various promises were made. First on 10 April 2007 Mr

The promised £200,000 did not arrive: so Mr Ghadami reinstated his notice on

Shortly thereafter (on 30 June 2007) Mr Ghadami was due to receive payment of £24,350,000 under the 2006 Note. Mr Ghadami says that Mr Bloomfield tried to negotiate payment terms, and he accepted payment by instalments, but the instalments were not kept up. However, he did receive a payment of

The outstanding obligations under the 2006 Note led to the signature on 12 September 2007 of yet another promissory note (“the Third 2007 Note”) this time Mr Bloomfield conditionally promising to pay £33,904,940 on 12

Mr Ghadami says that he circulated copies of the Third 2007 Note to Mr Fincken and to Saif Durbar asserting that they had acknowledged that they would be jointly and severally liable with Mr Bloomfield on it: he says he has never received any denial from them that this is so.

Just to complete the account of the sale of 42 Upper Grosvenor Street and 42 Reeves Mews, on 5 October 2007 they were split into separate titles (I slightly simplify a more complex transaction). 42 Grosvenor Street was transferred by

The complaint in this action is principally about 42 Upper Grosvenor Street/42 Reeves Mews. But mention is made of the other properties and I ought briefly to record what is said by Mr Ghadami about them. 41 Upper Grosvenor Street and 41 Reeves Mews were also being sold. The registered proprietor appears to have been 41 UGS Inc., of which Mr Saunders was a director. The transferee was Merix International Ventures Ltd (D18): they were represented in the transaction by Mr Chohan. The purchase price was £25,850,000. The deal appears to have completed on 30 March 2007. According to Mr Ghadami,

Mr Ghadami says that because he did not receive what was due to him in respect of the Blackraven Agreement (as varied) Mr Bloomfield orally agreed on 29 April 2009 that Mr Ghadami would receive 25% of the net profits of the sale of 41 Upper Grosvenor Street/41 Reeves Mews (“the 2009 Oral Agreement”). It is not clear how this promise concerning 25% of the “net profit” relates to Mr Bloomfield’s promise to share the 25% “commission” he was said to be due or to the promise Jan Bonde Nielsen is said to have made about the diversion of Mr Bloomfield’s 25% “commission” (insofar as these promises extended to 41 Upper Grosvenor Street).

Other events occurred before the issue of the Claim Form on 9 April 2013: but

The Claim Form, first, seeks damages against Mr Bloomfield, Jan Bonde Neilsen and Saif Durbar for breach of contract. The contracts relied on are (a) the 2005 Management Agreement (about transferring 3 properties) (b) the First 2007 Note (to pay £200,000) (c) the Second 2007 Note (to split the 25% commission 50/50) and (d) the Third 2007 Note (the conditional promise to pay £33.9 million). In the alternative, second, it seeks specific performance of the 2005 Management Agreement by the transfer of 42 Upper Grosvenor Street/42 Reeves Mews. Thirdly, it seeks damages from all of the Defendants other than Mr Bloomfield “for breach of the economic torts conspiracy and/or interference with a contract or business and/or inducing or procuring a breach of contract and/or causing loss by unlawful means”.

The Particulars of Claim enlarge upon those economic torts in the following way:-

“ …all the property transactions as set out above were sham transactions – they involved the same solicitors, the same buyers and sellers (who were often owned by the same human owner)… The effect of the said transactions was to deprive the claimant of the ownership of 42 [Upper Grosvenor Street] and 42 [Reeves Mews]…… The persons behind the company defendants (and therefore also the companies) as well as the other Defendants knew that the Claimant was entitled to 42 [ Upper Grosvenor Street] and 42 [Reeves Mews] and/or the monies in the various agreements above. This is because they are all employees or agents of Mr Jan Bonde Nielsen…. The same persons knew that the effect of their actions would be to deprive the Claimant of the ownership of 42 [Upper Grosvenor Street] and 42 [Reeves Mews] and/or deprive him of the monies arising from the various agreements… They are thus all

Mr Ghadami obtained judgment in default against Mr Bloomfield, Mr Risbey

The strike out and summary judgment applications came before Deputy Master Mark (“the Master”) on the 19 February 2014. On 13 February 2014 Mr Ghadami had lodged three lever arch files of documents additional to those annexed to the Particulars of Claim or exhibited to his witness statement.

Mr Ghadami did not attend the hearing before the Master but sent his son to make an application for an adjournment. The Master declined to adjourn the applications. He considered the entire claim to be “manifest nonsense”. He said that although Mr Ghadami produced many hundreds of pages of documents show connections between defendants, none of it suggested that Mr Bloomfield was acting as the agent of any other party, and that the suggestion that everybody knew everything (because they had some

On 28 February 2014 Mr Ghadami sought to persuade the Master to withdraw his judgment, relying on Re Barrell [1973] 1 WLR 19: but the Master said he would proceed with a hearing to determine the form of his order.

So on 14 March 2014 Mr Ghadami made his application to set-aside “the decision” made by the Master (“the Application”). In support of the

By his order dated 28 March 2014 the Master

Following the Order Mr Ghadami (a) on 31 March 2014 made an application the Master should recuse himself from all further dealings; and (b) on 22 April 2014 filed an Appellant’s Notice (“the Appeal”). It is important to note that the Appellant’s Notice only challenges the decision of the Master not to adjourn the hearing of the summary disposal applications. It does not seek to say that the Master erred in law in the substantive decision that he took about striking out the cases (including his decision to consider the position of D9 and D10). Not unnaturally that caused some puzzlement to those considering the grant of permission to appeal: but on 31 July 2014 Arnold J granted permission to appeal (although he expressed himself unable to understand the point in the Appeal) and he directed that the “set-aside” Application be heard

In the afternoon of the working day before the hearing Mr Ghadami lodged a further 15 lever-arch files of documents together with (a) an application (supported by a witness statement dated 11 December 2015) to adduce them at the hearing and (b) an application to bring contempt proceedings against Mr Saunders, Jan Bonde Nielsen, Peter Bonde Nielsen, Saif Durbar, Mr Rhodes and Mr Bakhda. This evidence did not direct attention any particular documents as being relevant to any particular issue arising on either the Appeal or the Application. These documents represented 10% of the product of a dozen or so applications which Mr Ghadami had made in the Applications Court (and elsewhere) against various persons (including many firms of solicitors) for third-party disclosure. (I myself granted one of the first of those in November 2014 on the footing that Mr Ghadami was pursuing judgment against Festio: it does not appear that I was told that the claim against Festio had been struck out in March 2014).

I should first note how this huge volume of material was dealt with at the hearing. Rather than use time that could more usefully be spent on the

I should next deal with the issue raised by the concurrent hearing of the Appeal and the Application. The relationship between (i) appeals and (ii) applications to set-aside upon the grounds of non-attendance were considered by the Court of Appeal in Bank of Scotland v Pereira [2011] EWCA Civ 241. That case considered the interrelationship between appeals and applications under CPR 39.3. Two points arise.

First, the hearing before the Master was not a trial but an application to dispose of Mr Ghadami’s action summarily by striking it out or granting summary judgment. The relevant rule governing applications to set-aside by a non-attending party is CPR 23.11 (with the added gloss provided by CPR 24 PD para 8).

In relation to applications by a non-attending party to reopen what are in effect final orders made on applications under CPR 23, I hold that the Court ought (following the guidance given in CPR 1.2) to consider at least the same factors as would fall for consideration under CPR 39.3 (a good reason for nonattendance; an arguable case on the merits; a prompt application to set aside), being careful to treat those simply as factors to be weighed (amongst other relevant circumstances) in the exercise of the discretion conferred by the rule, and not as mandatory requirements (which is the way those factors are treated by CPR 39.3). In fact Mr Ghadami argued his case as if the relevant rule were CPR 39.3: but I shall adopt the more benevolent approach.

Second, in Pereira at paragraph [37] the Court held that where a party is seeking a fresh hearing on the ground of non-attendance at the original hearing then (even if there are other grounds of appeal) that party ought first to make an application to set-aside. I propose to follow that guidance when considering the Appeal and the Application. Its good sense is evident in general: it directs attention to the reality of the underlying case as demonstrated by the material before the Court. But it is particularly apposite where the Appeal is procedural and the Application is substantive. As Arnold J put it to Counsel seeking permission to appeal on Mr Ghadami’s behalf:-

“…if your client has substantive merits, then the order will be set aside. If your client does not have substantive merits, the procedural wrong goes nowhere…”

I must next address the causes of action on which Mr Ghadami relies. For the purpose of analysis it is useful to group the causes of action into three categories.

First, the breach of contract claim against Mr Bloomfield is (subject to two observations) straightforward. The first of the observations is that the language in which the various contractual obligations are expressed is not always entirely clear: in particular it is not expressly made clear whether later agreements are substitutes for or additional to earlier agreements. The second observation is that there is no enforceable contract for the transfer by Mr

Second, the breach of contract alleged against Jan Bonde Nielsen and Saif Durbar is (save in one respect) dependent on the proposition that Mr Bloomfield was their agent. So it will be necessary (notwithstanding the complete absence from every contractual document of any suggestion that Mr

Third, there are the economic torts pleaded against all defendants other than Mr Bloomfield (being alternative claims against Jan Bonde Nielsen and Saif

The essence of the tort of conspiracy is an agreement or understanding either (a) to do a lawful act having the predominant purpose of injuring the claimant or (b) to use unlawful means intentionally to injure the claimant. It appears to be alleged that the conspirators were conspiring (i) “to avoid paying [Mr Ghadami] the sums owed” and (ii) not to transfer 42 Upper Grosvenor Street to Mr Ghadami. Conspiracy can be a difficult thing to plead (not least because concealment is frequently part of the modus operandi). But a conspiracy claim inevitably involves allegations of knowledge: and under paragraph 8.2 of

To be liable for inducing a breach of contract there must obviously be a contract; and the actor must actually know (or be recklessly indifferent to the fact) that he or she is procuring an act by a party to the contract that is a breach of that contract, and must intend that result. Mr Ghadami must show that there was an intentional invasion of his contractual rights and not merely that the breach of contract was the natural consequence of a particular defendant’s conduct.

The tort of causing loss by lawful means (or interference with business by unlawful means) requires proof that the defendant intentionally damaged the claimant’s business by using unlawful means. It is intended to provide a

Having set the context of the Application I can now address the material deployed by Mr Ghadami, reminding myself that the material is not deployed to prove a case, but only for the purposes of enabling an assessment to be made whether Mr Ghadami’s case against each Defendant has a real prospect of success or is properly characterised as fanciful. (I adopt the guidance given in paragraph 39.3.7.3 of the White Book). I can proceed immediately to that issue because I accept (as did the Master at a subsequent review hearing) that Mr Ghadami had a good reason for non-attendance (a late attack of shingles) and has brought the Application promptly.

Mr Ghadami set out to prove that everyone else in the case has lied (and indeed has brought a contempt application on that basis). But this is a burden he does not have to assume. His submissions, therefore, had a slightly different focus from the issues I am required to address. I will concentrate on what is necessary for the fair disposal of the Application.

At the heart of the case is a “promise” Mr Bloomfield made about 42 Upper Grosvenor Street and 42 Reeves Mews: I use the quotation marks as a shorthand for “the alleged promise”, because the matter is contentious and because the promise is not directly enforceable (which is why Mr Ghadami has elsewhere argued that it is a representation which founds a proprietary estoppel). His judgment against Mr Bloomfield has proved useless: so he seeks to enforce the “promise” against Jan Bonde Nielsen and Saif Durbar. Two arguments were deployed to reach that conclusion.

The first was that Mr Bloomfield himself had a sufficient interest in 42 Upper Grosvenor Street and 42 Reeves Mews (together “No.42”) to make the “promise” capable of fulfilment. The second was that Mr Bloomfield was simply the agent of the real owners who are said to be Jan Bonde Neilsen and Saif Durbar.

The short answer to both these points is that if the “promise” about Number 42 is not enforceable then it does not matter what interest Mr Bloomfield had in

The allegation that Mr Bloomfield was the principal in the transactions is (to understate the matter) a “change of emphasis”: but Mr Ghadami now says it is

“set in concrete”. The documents show that the registered proprietor of Number 42 was Larios Properties Ltd. In support of the attempt to remove the first unilateral notice put on the title by Mr Ghadami (which was based on the “promise” by Mr Bloomfield ) Mr Bloomfield made a statutory declaration. It said:-

“I am not an officer of Larios Properties Ltd nor do I have any legal or beneficial interest in Larios Properties Ltd nor have I any authority to bind Larios Properties Ltd nor have I ever represented to anybody that I have authority to bind Larios Properties Ltd. Further, I have no interest whether legal or beneficial in [Number 42]. or any other properties for that matter.”

Mr Ghadami says he will establish at trial that that was untrue. He relies in part upon a witness statement which Mr Bloomfield signed on 30 April 2009 in which he said:-

“ I made these statements without the benefit of legal advice and having now reviewed the matter in close detail, it appears that my understanding of the facts, as I believed them to be, and my legal rights and interests in the Properties arising therefrom have only just been explained to me and, in the circumstances, I must change that which I had previously stated. ”

It is common ground that Larios Properties Ltd was at the time of the “promise” the wholly-owned subsidiary of Festio Investments Ltd (a Cypriot company). (Mr Ghadami spent some time in submissions exploring the fact that there are two share certificates, one in BVI form and one in Jersey form, recording this ownership. The one in Jersey form seems to me a mistake by the Jersey directors of the BVI company, and not to be relevant to the issues for decision).

Festio acquired the Larios shares with the benefit of bank funding. On 16 June 2006 Mr Bloomfield signed a security document in favour of the bank as a director of Festio; he also signed a Facility Agreement in that capacity, and also a Subordination Agreement (whereby Greenoak Holdings Limited, of which Mr Bakhda was a director and which appears to be the holding company of Festio, postponed its lending to that of the bank). Furthermore on 19 June 2006 Mr Bloomfield (along with Greenoak Holdings Limited) signed a guarantee in support of Festio’s borrowing from the bank. These documents do suggest that Mr Bloomfield had an executive role, and the last suggests that he had some economic interest in Number 42.

The fact that Mr Bloomfield had an executive role in the holding company of the registered proprietor of the asset goes no way toward showing that Mr Bloomfield himself had any proprietary interest.

Mr Ghadami asserted that Mr Bloomfield was “the real purchaser”. The assertion does not easily square with all of the documents which refer to Mr Bloomfield’s entitlement to “a commission” on sale (which is not something a real owner would pay himself) or with Mr Ghadami’s pleaded claim to all or part of that “commission”. But I will address the case I understood him to advance.

He relied first on an informal reference in an e-mail of 27 January 2006 passing between solicitors engaged in the finance arrangements for a thencurrent joint venture to “the proposed purchase of 42 Upper Grosvenor Street by Paul Bloomfield”. But an account of the then-current joint venture proposal (called “Project Clearbrook”) as recorded by the bank in a Credit Committee report of January 2006 and subsequent documents (the initial report is misdated) conclusively shows that this is not the transaction that eventuated six months later. The ultimate transaction was not an asset purchase by a joint venture company formed by Mr Bloomfield and Clearbrook, but (according to

Then Mr Ghadami relied upon a letter which Mr Bloomfield had signed on 20

The documents undoubtedly show that in the transaction that eventuated Mr Bloomfield had an executive role to play. I should briefly note here a controversy about whether Mr Bloomfield’s executive role was deliberately suppressed. Mr Johnson (a solicitor who originally thought that he had been instructed by Festio) put in evidence material which he said had been provided to him by one of his clients. The exhibit was a photocopy of a certificate from the Cypriot Companies Registry which showed Festio to have been dissolved in 2010: it bore an authentication stamp below the statement of information.

With a diffuse statement of case and a welter of lately produced material it is essential to focus on the Application itself. I have deferred consideration of the contempt application. My present concern is to assess the merit of Mr Ghadami’s claim not the demerits of the conduct of the defence (if such has taken place). As to the merits, Mr Ghadami submitted that if Mr Johnson was willing to go to the lengths of defacing an official search certificate (I should say that there is no evidence he did any such thing) then it must be because it is seen as important to hide the involvement of Mr Bloomfield with Festio: he asked “Why would they say untrue things unless everything I say is right?” But I can assume for the purposes of this application that Mr Bloomfield was a director of Festio. However, that does not assist in determining the ownership Number 42.

Mr Ghadami argued that in fact Mr Bloomfield was also a 50% shareholder in Festio. He relied on some evidence that Mr Rhodes gave in a Schedule he prepared as part of a disclosure exercise in unrelated Commercial Court proceedings in 2009. Mr Rhodes’ understanding of the position was originally challenged by other parties: but in the course of the hearing it became clear that they accepted that Mr Ghadami was right, and that Mr Bloomfield did hold 50% of the shares in Festio. But they continued to maintain (as they had from the outset) that if he did then Mr Bloomfield can only have been a nominee, probably for Saif Durbar. I cannot resolve that dispute on this application. But even if Mr Ghadami is right that Mr Bloomfield was the beneficial and not the fiduciary owner of half of the Festio shares, it is unreal to suggest that Mr Bloomfield had any proprietary interest in Number 42 itself (as Mr Ghadami insisted). A shareholder in and director of a holding company does not have a proprietary interest in the assets of the subsidiary.

Mr Ghadami submitted that the simple fact that D4,D5,D7 and D8 had been shown to be wrong in doubting his case that Mr Bloomfield owned shares in Festio meant that his whole case ought to go to trial. I do not agree. Before we get to the defects in the defence we have first to look at whether the case advanced in the claim has a real prospect of success.

So I am clear that Mr Ghadami’s labours to establish that Mr Bloomfield had some interest in Number 42 capable of supporting the “promise” (assuming it to be enforceable) go nowhere.

The second argument is based on agency. Mr Ghadami says it is not his case anymore, but it is the case that is pleaded and is his only route to enforcement of the 2007 Notes against anyone other than Mr Bloomfield. The status of

“agent” is not a fact: it is a legal conclusion drawn from primary facts. Mr Ghadami asserts the conclusion (see appendix B section (1) attached to the draft Particulars of Claim) but does not plead any facts directly concerning the Blackraven Agreement or the subsequent transactions on which this conclusion rests. What material did he deploy to prove agency?

Amongst a range of highly colourful and entirely tangential allegations concerning connections between various individuals and their participation in sundry transactions the following most closely relate to the question of agency in relation to 42 Upper Grosvenor Street, 42 Reeves Mews, 41 Upper

In my judgment even if Mr Ghadami proved each and every one of those allegations he would have no real prospect of establishing that Mr Bloomfield was the agent of Jan Bonde Nielsen or of Saif Durbar when entering the 2005

Of course, Mr Bloomfield may himself have made his promises to Mr Ghadami on the faith of promises of indemnity from others - the legal owners of the properties or those who were economically interested in the ventures or who were otherwise contractually bound to Mr Ghadami. But any such arrangement would not give Mr Ghadami any direct right of action in contract against those others.

The “agency” argument is fanciful and goes nowhere. As regards the various agreements Mr Ghadami seeks to enforce it is clear that neither Jan Bonde Nielsen nor Saif Durbar is a primary obligor.

This brings me to the “economic torts”. One can put on one side “inducing a breach of contract”. There was no enforceable contract relating to Number 42. There is no case pleaded against the Defendants that any of them intentionally interfered with the payment obligations under the 2007 Notes on which Mr Ghadami sues. So I focus on the other claims. What does Mr Ghadami say about “combination”? What does he say was the “conspiracy”? What are the “unlawful acts”? What material is there to show that there was a predominant purpose of injuring Mr Ghadami? Or any degree of intention to injure him?

Mr Ghadami relied on two arguments. First, connection between the parties. Second, participation in sham sales.

Dealing first with “connection”: Mr Ghadami’s case is that “given the connections between all the Defendants as set out in Appendix B” and “because they are all employees or agents of Jan Bonde Nielsen” in participating in various property dealings the Defendants “knew that the effect of their actions would be to deprive [Mr Ghadami] of the ownership of [Number 42] and/or deprive him of the monies arising from the various agreements”. As a preliminary point, such “knowledge” (even if proven) would not be enough to establish any of the economic torts pleaded. The case cannot be made out. But I ought also to address the “connections”.

The reference to “Appendix B” is a reference to a 4-page document served with draft Particulars of Claim. The actual Particulars of Claim themselves set out, over 25 paragraphs, various alleged connections between the parties. A sample would be

I have considered Appendix B. I have considered the terms of the Particulars of Claim. To say of the people I have taken as examples that “given his knowledge and actions he must have conspired” (in a statement of case signed by Counsel) is so unsatisfactory as to amount to an abuse of process: compare

In that regard his best target was Mr Saunders to whom he was an undoubted irritant and against whom (stripping away the “mud-slinging” which the Particulars contain) there was the beginnings of a case that Mr Saunders had acted unlawfully in removing Mr Ghadami’s unilateral notice. But the fundamental difficulty with such a claim is that nothing in the pleaded case suggests that there was any proper ground for that notice. There was no enforceable contract for the transfer of Number 42 to Mr Ghadami. Even if the UN1 had relied not on contract but on equitable estoppel there was (on the facts pleaded in the Particulars of Claim) simply no ground for it. A bare promise does not create an estoppel.

Notwithstanding the enormous use of Court resources in providing Mr Ghadami with material and the equally significant use of Court time in allowing him to deploy it and to assess its significance I am satisfied that the conspiracy claims and those claims based on an intention to cause Mr Ghadami loss simply have no foundation.

Before moving to the last issue on the Application I should place on record that Mr Risbey wrote a letter to me which I opened at the end of the hearing (no-one having referred to it in the course of the hearing). It made derogatory comments about Mr Ghadami, and resisted any change to the Master’s order.

I now deal with “sham”. It is well to remember what a “sham” is. It is a transaction which is intended by all the parties to it to give to third parties the appearance of creating between the participators legal rights and obligations different from the actual rights and obligations which the participators intend to create between themselves. So “intention” (which may of course be established by inference drawn from primary facts) is again central.

Mr Ghadami was anxious to establish the sales by Larios of Number 42 were

“shams”. As he put it in paragraph 12 (ii) of the Particulars of Claim:-

“the buyers and sellers of the properties were the same legal entity, or owned by the same legal entity or persons, or by persons with close connections to each other. At the very least it shows that the transaction was a sham and made without a bona fide intention to create legal relations”.

An example of the material he relies on to prove this allegation is a record of the telephone conversation he had with Saif Durbar on Christmas Eve 2008. Mr Ghadami had suggested that Lynn Properties Ltd (a company with that name acquired a leasehold interest 42 Reeves Mews and sold it to Vitala

Of course, the short answer is that even if two companies are in the same ultimate beneficial ownership the transfer of an asset from one to the other is not thereby rendered a sham, and the “buyer” and the “seller” are not “the same people”. A more complicated answer is that a review of the documents to my mind demonstrates that when the original proposal was to hive down the asset to an SPV a UK entity called Lynn Properties was created for that purpose: but when the form of the transaction changed to an asset sale to a third party the third party created a purchasing company (Lynn Properties (BVI)) with the probable aim of causing the minimum disruption to negotiations with the Grosvenor Estate.

The documents appeared to me credibly to show (a) that in the autumn of 2006 there was a proposal by Larios to sever 42 Upper Grosvenor Street from 42 Reeves Mews with a view to obtaining planning permission for change of use and enabling enfranchisement of the newly-created separate leasehold interest in 42 Reeves Mews to take place; (b) that the machinery to be employed was a surrender of the original long leasehold and the grant of fresh separate leases; (c) that the original proposal was that the leasehold interests should be vested in SPVs (one of which was intended to be Lynn Properties (UK)) which would then be sold off: (d) that there was an abortive sale; (e) that in the event the intended transactions had to proceed by way of asset (not share) sales. So it came about that Lynn Properties (BVI) (a company with no connection to Lynn Properties (UK) other than a shared name) took an assignment of the newly created long leasehold interest in 42 Reeves Mews in August 2007: and Vitala took an assignment of the lease of 42 Upper Grosvenor Street at the same time. These transactions had a manifest commercial purpose in which (from the completion statements relating to them) there had been considerable investment of effort and expertise and in which real money changed hands (and in which, incidentally there was plain “arm’s length” dealing). Over his four days of argument Mr Ghadami made a number of points about these

First, on 2 August 2007 Larios Properties Ltd transferred 42 Reeves Mews to Lynn Properties (BVI). The stated consideration was £8,350,000 (though the true consideration is mistyped in some documents as £835,000 or £8,035,000).

Second, the certified copy of the TR1 recording the sale of 42 Reeves Mews differs from a surviving signed but undated copy which says that the consideration was £7,250,000. This lower price is the figure referred to in a letter which Mr Saunders wrote to Mr Rhodes in November 2007 giving an account of the transaction, enclosing a vendor’s cash statement (which also refers to the sale price for 42 Reeves Mews as being £7,250,000). It was then adopted by Mr Rhodes when he gave evidence in some unrelated proceedings in the Commercial Court in April 2009 against Peter Bonde Nielsen and others (which evidence Mr Ghadami has uncovered). But whatever was in the draft pre-completion documents and whatever Mr Saunders put in the account he rendered to his clients the documents record the consideration actually paid. Mr Saunders’ mistakes (and there are several in the course of the conveyancing) do not make the transaction a “sham”.

Third Mr Ghadami has obtained from evidence given in the unrelated Commercial Court action to which I have referred a copy of a Statement of Account to Lynn Properties Ltd relating to the purchase of 42 Reeves Mews with a stated completion date of 11 July 2007. He contrasts this with a Cash

Fourth, Mr Ghadami has discovered that on 16 October 2006 Larios Properties Ltd agreed to sell the issued share capital of Lynn Properties Ltd (not D 16 but the English company with the same name) to Goldsky Ventures Ltd. He has got a copy of that contract and spotted that Goldsky Ventures Ltd is described as being a BVI company whereas in fact it is a Seychellois company. He has got another copy of the contract (which correctly identifies Goldsky Ventures Ltd), but this contract is dated 10 January 2007. Mr Ghadami submits that these differences are suspicious and that of itself should prompt the court to embark upon an enquiry into the transactions. I do not agree.

The focus of the enquiry has to be whether Mr Ghadami has available to him material of sufficient substance to warrant the case he has pleaded in tort going to trial. There are no doubt many questions that arise on documents within the 28 lever arch files that have been prepared for this application: but that does not mean that Mr Ghadami’s own case has merit or that there should be a trial. The matters he relied on at the hearing do not begin to demonstrate that the transactions were a “sham”.

Mr Ghadami was also anxious to demonstrate that the sale of 41 Upper Grosvenor Street was also a sham (although he does not seek to enforce any promise that it should be transferred to him). The documents seem to me credibly to disclose the following. On 23 March 2007 a Cypriot company (Z) in the Greenoak Group bought the entire share capital of 41 UGS Inc. (a

Mr Ghadami says (a) that Handdoxx Investments is Kazakh money: and (b) that it is important to note that (according to press reports) on the day before exchange there was an announcement by the Greenoak Group that its subsidiary (chaired by Jan Bonde Nielsen) had entered into a joint venture with the Kazakh state oil company for the building of a new oil refinery at Batumi; (c) accordingly a link can be established between Jan Bonde Neilsen and Kazakh interests; and (d) this link leads reasonably to the supposition that although the acquisition of 41 Upper Grosvenor Street and 41 Reeves Mews was apparently by Merix funded by a loan from Handdoxx, in fact these entities were simply lending their names to the real acquirer who was Jan Bonde Neilsen. He supports this by saying that Kazakh interests would not instruct a firm like Magwells (of which Mr Chohan was a partner). I regard this case as fanciful.

Then Mr Ghadami refers to a cash statement prepared by Mr Saunders and headed “41 UGS Inc: re 41 Upper Grosvenor Street and 41 Reeves Mews as at 30 March 2007”: this includes an entry “30 March 2007 stamp duty” in the sum of £1,034,000. Mr Ghadami says that it was for the buyer to pay the stamp duty and Mr Saunders should not have been paying it, so that this demonstrates that the same people were on both sides of the transaction. But it seems to me that the stamp duty for the payment of which Mr Saunders was accounting to his client was stamp duty payable on the acquisition by Z of the share capital of 41 UGS Inc, not stamp duty in respect of the sales of the long leases to Merix. Mr Saunders’ cash statement (which is not easy to follow) deals with payments out in respect of the share purchase and receipts in respect of the lease sales: and that is the way I read it. But even if I am wrong about that (and Mr Saunders was telling his client that he had paid the stamp duty on the land sale) it appears from the documents that Merix borrowed a sum equal to the stamp duty and paid it to HMRC, Merix having in its possession the relevant return: so Mr Saunders was simply wrong. I consider Mr Ghadami’s analysis (that Mr Saunders paid the stamp duty out of the sale price and thereby demonstrated that the purchase monies did not come from a third party but were simply the vendor’s monies employed in a circular transaction) to be fanciful. I do not accept his submission that he has demonstrated that there is something to be tried.

Then Mr Ghadami refers to a document (15/694) prepared on behalf 41 UGS Inc and addressed to Merix and to Mr Chohan which he describes as “a completion statement” which tells Merix what it has to do and demonstrates that Mr Saunders was preparing documents on both sides of the transaction (underpinning his argument that the transaction was a sham). I do not accept this submission. On examination the document is simply a VAT invoice such as one would expect. It does not indicate that there is a case on the merits.

Then Mr Ghadami asserts that although 41 UGS Inc collected £3,850,000 of VAT “it does not appear that this was accounted for to HMRC”. So Mr

Finally, Mr Ghadami drew attention to the existence of differing versions of the completion statements. It seems to me that these do not demonstrate that the vendor and the purchaser were the same entity, but rather that completion was delayed from the originally intended date of 11 July to a later date when the documents of title were in order. This does not indicate “sham”.

The only real analysis is that Lynn, Vitala and Merix genuinely acquired the properties for their own purposes and not with the intention of defeating some lawful claim of Mr Ghadami: and that far from intending to frustrate payment

Notwithstanding Mr Ghadami’s deployment of material from the vast quantity he has garnered I do not consider that his “economic tort” case has any merit. I think the Master got the outcome exactly right. I would leave his order undisturbed and dismiss the Application.

In leaving the order “undisturbed” I should draw attention to one matter. Mr Buttimore submitted that the Application amounted to a request for a rehearing: and if I was conducting a “rehearing” then he would seek an order that Mr Ghadami should be prevented from being permitted to amend his

It is in these circumstances it is perhaps unnecessary to consider the Appeal. But I should briefly record the factual background and for clarity and certainty express my view.

The hearing before the Master was itself an adjourned hearing having been stood over from September 2013. Mr Ghadami wanted it adjourned again. He made his first such application on 24 January 2014, on the ground that he needed time to prepare. That application was refused by a Chancery Master, an appeal against the decision was dismissed, and a further appeal to the Court of Appeal rejected. So on 11 February 2014 Mr Ghadami circulated the other parties to say that his house had flooded on 7 February and that he had become ill and had obtained a doctor’s appointment; and he sought an adjournment by consent. The other parties declined to agree an adjournment on that basis, but sought the provision of medical evidence.

Mr Ghadami provided a medical certificate dated 14 February 2014 recording that he attended the Ongar Health Centre on the 11and 13February complaining of a bad cold with features of sinus congestion. He then provided a medical certificate dated 15 February 2014 confirming the second of those appointments and the diagnosis of acute sinusitis. The other parties declined to agree an adjournment. On 17 February 2014 Mr Ghadami made an application to Stephen Richards LJ for an order adjourning the hearing of the summary disposal applications: but an adjournment was refused, and Mr Ghadami was directed to the Master.

Mr Ghadami applied to the Master by email on 17 February 2014 enclosing the two doctor’s letters to which I have referred. The Master declined an adjournment, saying that any application would have to be made at the hearing itself. So Mr Ghadami submitted a third doctor’s letter recording a surgery attendance on 18 February 2014 with a rash that was diagnosed as shingles. He circulated all parties and informed them that in the light of this latest letter their attendance may not be required at the hearing. All attended.

At the hearing the application for the adjournment was made on Mr Ghadami’s behalf (in his absence) by his son Joseph, who said that his father needed a month or two to instruct a legal team.

The Master accepted that it was sensible that Mr Ghadami should not personally attend the hearing but said that it did not follow that the hearing should be adjourned, since there were apparent deficiencies in the Particulars of Claim which could be addressed and possible defects in the case advanced rendering it potentially incapable of success: and that if this was indeed the result of the hearing Mr Ghadami could apply to set aside the decision in whole or in part, but with the benefit of the analysis undertaken by the court.

Mr Ghadami argued that in so deciding the Master erred in law because the only course open was to adjourn. He relied on the observations of Holman J in

In my judgment this passage does not lay down a rule of law: and it does not set in stone the way the undoubted case management discretion must

I would dismiss the appeal on the ground identified by Arnold J. If there was a procedural error, then it is of no significance because the underlying case itself lacks merit.

I would in the alternative hold that the decision of the Master was not unfair. The Master did not shut out Mr Ghadami: he explicitly recognised that Mr

I therefore dismiss the Appeal.

I will hand down this judgment in Leeds on 14 October 2016. I do expect the attendance of any parties. The parties should liaise to fix a date for dealing with consequential matters arising out of this judgment, Mr Ghadami’s application to bring contempt proceedings and the application Mr Ghadami made on the last day of the hearing to amend his Particulars of Claim.