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	England and Wales Court of Appeal (Civil Division) Decisions
You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Vedatech Corporation v Crystal Decisions (UK) Ltd & Anor [2002] EWCA Civ 357 (28 January 2002) URL: http://www.bailii.org/ew/cases/EWCA/Civ/2002/357.html Cite as: [2002] EWCA Civ 357

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IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE CHANCERY DIVISION
(Mr Justice Evans-Lombe/Mr Justice Hart)

		Royal Courts of Justice Strand London WC2 Monday, 28th January 2002

Monday, 28th January 2001

1. LORD JUSTICE WARD: I turn to three applications for permission to appeal. Because the papers are open in front of me, I will deal with the last first.
2. This is an application for permission to appeal the orders made by Evans-Lombe J on 21st January 2001, exactly a week ago. I think he sat late, though I hope he did not sit as late as this. Part of it I have already dealt with by allowing the appeal on security for costs. What is left? Firstly, an appeal against the judge's refusal to adjourn the application for security for costs. That has been overtaken by the events as academic, and I refuse permission to do so.
3. The next is an application to appeal against the refusal to strike out portions of the defence which raise as a defence the possibility that the claims for quantum meruit now raised against Nihon are defeated by the Limitation Act 1980. I think that Mr Subramanian misunderstands the effect of that. That is a perfectly proper pleading. It enables the defendant to plead limitation as a defence to the action. They had earlier been raising limitation difficulties as a reason for permitting the amendment altogether. They are entitled to have their day at some stage; and that is an issue properly to be decided at the trial. The application in regard to the appeal under paragraphs 2 and 3 are both dismissed.
4. The next application relates to the refusal of the judge to permit a costs judge to sit on the security for costs application. It is not actually in the order. It is not usual. It is overtaken by our allowing that appeal; so there is no permission in respect of that.
5. The application in respect of cross-examination of the witnesses is perhaps again a product of misunderstanding. The position is this. Witnesses overseas have put in statements which the claimant would seek to have admitted under the hearsay provisions. The defendants have, quite rightly, asked for those deponents, or the makers of those statements, to attend for cross-examination. The exercise of discretion ordering that that be done is a perfectly proper one, and there can be no appeal against it. But, for the avoidance of doubt, I hope Mr Subramanian now understands, following the short discussion I had with Mr Hildyard, that if it transpires that he cannot produce the witnesses at the trial, he is at liberty to renew the application for either their evidence to be taken on the video link or for their statements to be put in under the hearsay rule. But he cannot prevent the defendant then raising the same arguments raised before the judge and, in addition, raising the fact that this order has been made. Within those limits it will be a matter for the judge to look at and to rule upon at the trial, and I refuse permission in that regard.
6. There is an appeal against costs. Mr Subramanian does not now really pursue the appeal against the order that he pay the costs of the attempt to adjourn the application made to Mr Justice Jacob on 15th January. He has got his costs in respect of the security for costs. There is, I suppose, technically, the costs of the separate application brought by the defendants for the cross-examination, which may not actually be the subject of any order at all at the moment. I am not quite sure where those costs stand. I would have thought they ought to be costs in the case. I am not sure the judge has actually dealt with them at all now that I look at it closely.
7. MR HILDYARD: I think that is right, my Lord. I think that because we had at that stage succeeded on the security for costs and quite a lot of time was expended on the security for costs, it may be that got left out. I would accept those costs ought to be costs in the case.
8. LORD JUSTICE WARD: I am very grateful. That exchange will be recorded in this judgment. (May I add Mr Hildyard's intervention is another example of his endeavouring to be helpful. I know that Mr Subramanian has concerns about the great forces ranged against him, but I point to that as an example of the conduct I expect not only of counsel but of those who instruct them. I see no evidence of your being unduly steam-rollered.)
9. I think I have dealt with all of the applications to appeal against the order of Evans-Lombe J and I can pass to the other applications.
10. The next application (and I will deal with them in reverse order again) is an application for permission to appeal the order made on 21st November by Hart J. The applicant's complaint there is as to paragraph 4 of the order as has been drawn in these terms:

"(4)that there be no Order in relation to the Claimant's Application for further specific disclosure, upon the Court holding that:

(a) the Defendant has complied with its standard disclosure obligations to date;

(b)the Defendant has taken a proper attitude to the Claimant's application for case management directions regarding further disclosure by indicating prior to the hearing that it would, by 11th December 2001, look for and produce relevant documents falling within certain of the categories of documents in respect of which specific disclosure is sought by the claimant."

11. In his judgment the judge said at page 5:

"The process of standard disclosure which was undertaken has been described by Mr. Botsman [he is the solicitor in the defendant's solicitors', Freshfields, with real conduct of the case] in a witness statement dated 6th November, and the sources of the information on which that is based appear from that witness statement. There has to be a limit to the degree to which the court goes behind statements of the kind contained in Mr. Botsman's witness statement. That would be the case even in a case where the evidence allowed some considerable suspicion as to the adequacy of the process. In the present case, however, I have not been persuaded by the claimant that the process undertaken was inadequate such that I should make any order requiring the defendants to undertake the process from scratch all over again. Of course disclosure is a continuing process; but I am satisfied, on the basis of the evidence that is before me in the form of witness statements of Mr. Botsman dated 6th November and 20th November, that a proper attitude has been taken by the defendants to their duties of disclosure, both in the original standard disclosure process and in response to the specific requests which have been made by the claimant in the period leading up to this hearing."

12. Mr Subramanian is concerned that the order as drawn suggests that the defendants and their solicitors have no continuing obligation to look for, and, if necessary, produce, relevant documents. I had the helpful intervention from Mr Hildyard when, I suppose it could be said, I had changed the hearing from one without notice to one on notice, and he confirmed, as I had thought, that the defendants regarded it as their continuing professional duty to keep an eye open for any material documents and that, if any appeared, they would be disclosed. That assurance satisfied Mr Subramanian at the time. It was recorded in the transcript of that oral exchange, it satisfied me and, in the circumstances, I can see no point in pursuing that part of the order. I refuse permission to appeal against that order.
13. The applicant also complains about the costs order, but that was for costs to be in the case. I cannot see anything wrong with the disposition about costs on that opinion, and so I refuse permission to appeal the order of 21st November.
14. I turn, finally, to the application to appeal Hart J's orders made on 7th November. The complaints there relate principally to the orders for amendment and the joinder of new parties. I will try to state this succinctly.
15. The claim against the first defendant, Crystal Decisions (UK), was originally brought for damages for breach of contract. Subsequently, amendments were allowed to plead alternative claims of unjust enrichment and a quantum meruit claim. Then the claimant applied to make much further applications. The first was to join Nihon, the Japanese company, and allege against them a claim for quantum meruit and for unjust enrichment. The quantum meruit claim was allowed by the judge, but the unjust enrichment was not permitted. That claim, as it was attempted to be formulated, was for Nihon as the entity which "was the result of the agreement between Holistic-UK and Vedatech to gorge" (I think that should read "disgorge") "the capital value of its own operations to Vedatech. That was the unjust enrichment. The judge dealt with that, saying that it was not properly a claim known to the law and he was not minded to grant that permission to amend. He was concerned about prejudice in any event.
16. I see the force of the criticisms made by the judge; but I was concerned that there would be an air of unreality to this trial if it appeared at the conclusion of it that Vedatech, the claimant, would have had a good claim for unjust enrichment and quantum meruit against Crystal UK but that that could not be advanced if Crystal UK's main case was accepted that really all of this was none of their business but the business of the Japanese subsidiary. So I was concerned that the claimant should not be entirely shut out.
17. When I turn, therefore, to look at what has been permitted, the quantum meruit claim, which the judge has admitted against Nihon in 193 of the pleading, is a claim which allows it to assert that:

"Nihon from its establishment in January 1996 was enriched by such services. It continued to be enriched after the gradual breakdown in the relationship between the parties ... . In the premises, Nihon is liable to provide restitution to Vedatech in the amounts that it has been enriched and continues to be so enriched."

18. I was not totally sure either from the exchanges between Mr Hildyard and the judge, as the judge recorded them in his judgment, or from the judgment itself how far that claim could carry the claimant. I invited Mr Hildyard's help. He was able, having taken instructions, to give this court (and more particularly Mr Subramanian) the assurance that they accepted that, whether strictly pleaded or not, the claimant would be able to claim against Nihon on a quantum meruit and that in this context the claimant would be able to invite the court to assess the value of that claim, if it be established, either on its market value (i.e. the reasonable costs of doing the work which was requested) or by reference to the value to the recipient of those services (i.e. the profit that they have enjoyed) in accordance with the way that sort of claim was advanced in Way v Latilla [1937] 3 All ER 759.
19. Once again, I was grateful to Mr Hildyard, and to those instructing him, for their constructive and cooperative intervention. That seems to me to cure any sense of injustice that I had that the claimant would not be able to make good its claim if they are successful.
20. I cannot but look at the claim that is pursued in this case, running as it does to 76 pages, and not wonder how the late lamented His Honour Judge Claude Duveen would have dealt with a matter of this kind. Undoubtedly he would have urged the parties to call the evidence, let him find the facts and then they would sort out the pleadings at the end of the case. It is His Honour Judge Claude Duveen's first rule, it has much to commend it and it seems to me to be in the spirit within which Mr Hildyard makes his concession that it may not be altogether inappropriate for the trial judge. But I leave him to judge that. In the result, it seems to me that justice is well met by the amendment which was allowed that the claim for unjust enrichment takes the matter very little further. I would not give leave, therefore, to add a claim for unjust enrichment against Nihon.
21. Then there are a tranche of claims in which it is sought to join as defendants the American company and the Singapore company. These are claims for various conspiracies. The judge dismissed the application, both on the merits and because of the threat to the fixture of 11th February. I was again troubled a little about that, for fear of putting the claimant at a huge disadvantage. But, having looked further at CPR 19.5, it seems to me, despite Mr Subramanian's cogent submission about the relevance of the decision of this court in Merett v Babb (an unreported judgment of this court) that he cannot bring his new claims adding those parties within any of the three limbs afforded by Rule 19.5 of 3(a), (b) or (c). I do not see how it can be argued that the claim cannot properly be carried on by or against the original party unless the new party is added or substituted as claimant or defendant. I can see no error in the judge's approach there. The claims have been made separately. Insofar as that has stopped the time bar clock running, the claimant is protected. I see no reason to complicate this litigation and put the trial date at risk by joining the American and Singapore companies, and I refuse permission to appeal that part of the order. The same reasoning justifies the judge's refusal to consolidate the new proceedings with the current proceedings. That would imperil this hearing date. It is imperative this hearing date be upheld. The prejudice would be enormous and, on prejudice alone, those judgment are unappealable. The judge has perhaps been favourable to the claimant company by staying the new proceedings, not dismissing them. I think, therefore, there is no ground of complaint there.
22. In this application there are only these further questions:

Costs

23. The judge made orders for costs, and assessed those costs, both of the hearing on 2nd October and of the hearing before him. The complaint is that he was wrong to do so. This seems to me peculiarly to be within the ambit of discretion. An appeal can only lie if the judge was plainly wrong about that, that is to say have exceeded the generous ambit within which there might be reasonable views taken. I appreciate the argument that a schedule of costs may have been served late. It was a point taken, I think, before Evans-Lombe J. It was not actually taken before Hart J. In any event, it would not be a reason for disqualifying the judge from making his best estimate. He did not need a costs judge there to assist him and I cannot see how it can be said that the judge was plainly wrong. This is a difficult jurisdiction to exercise. The judges have to be alert that claims may be inflated, but the judges have to be trusted by the Court of Appeal to do their best; and I would not interfere with the judge's approach.
24. As for the use of two counsel, the judge took the view that in a case of this kind it was not disproportionate. He was entitled to that view. I can well understand that decision. I have indicated already several times today how much benefit I have had from Mr Hildyard's interventions, and, given that, I am afraid the consequences are that poor old Vedatech has to pay for two counsel. It was not a disproportionate deployment of legal services by the defendants.
25. I conclude by dismissing all the applications and adding this postscript. Mr Subramanian has over the past year -- it will be a year tomorrow -- manfully struggled to make himself an expert in English law. I do not wish to flatter him unnecessarily, and I do not wish him to misunderstand me. I think he has done quite remarkably well to have got himself as organised as he has and to have presented his submissions to me always courteously, never extremely, never betraying the worst excesses of a disease which is frequently encountered in this court, which is called, at least by me, the disease of "lipitis", that is "litigant in person itis". Some litigants get carried away with the enthusiasm of their own cause. It is not a disease which I diagnose in Mr Subramanian. I think he has done remarkably well and it is now up to him to deploy all his forces to meet the trial date in two weeks time. I wish him, and I wish Crystal Decisions (UK) and Nihon the best of British luck as they go to that trial in the confident expectation that there will be no more applications between now and then that are called for at all, and certainly none that are going to be listed before Lord Justice Ward. I make a direction that any further applications for permission to appeal be determined by Lord Justice Aldous; and I require the associate to incorporate that in this order and to make sure that a copy of the order is served upon the clerk to Lord Justice Aldous, who has already indicated to me she has authority to accept the service of it on my Lord's behalf.
Order: Applications dismissed. No order for costs.