Smailes & Anor v McNally & Anor [2014] EWCA Civ 1299 (30 July 2014)

Smailes & Anor v McNally & Anor [2014] EWCA Civ 1299 (30 July 2014)

The omission to list and disclose the scripts, which were known to exist, highly relevant, and central to the liquidators' case, constituted a clear failure to comply with the Unless Order. The search was not reasonable as required by CPR 31.7, regardless of good faith or methodology, because the scripts were deliberately excluded without ensuring their disclosure. The Unless Order was therefore breached, and the proceedings stand struck out according to its terms.

Citation
[2014] EWCA Civ 1299
Parties
Claimant/applicant: Robert Derek Smailes; Claimant/applicant: Stephen Blandford Ryman; Defendant/respondent: John Henry McNally; Defendant/respondent: George Scott Maclean
Jurisdiction
England and Wales
Judgment Date
30 July 2014
Procedural Posture
Appeal / Judgment on Appeal From High Court (chancery Division, Companies Court)
Outcome
Appeal allowed. Proceedings struck out for non-compliance with Unless Order.
Legal Topics
Disclosure Obligations, Unless Orders, Relief From Sanctions, Standard Disclosure Under CPR 31.6 and 31.7, Fraudulent Trading, Trading While Insolvent
Civil Procedure Insolvency Company Law Disclosure Obligations Unless Orders Relief From Sanctions Standard Disclosure Under CPR 31.6 and 31.7 Fraudulent Trading +1 more

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Parties

Robert Derek Smailes

Claimant/applicant

Stephen Blandford Ryman

Claimant/applicant

John Henry McNally

Defendant/respondent

George Scott Maclean

Defendant/respondent

Procedural Posture

Appeal / Judgment on Appeal From High Court (chancery Division, Companies Court)

Legal Issues

  1. 1 Whether the claimant joint liquidators complied with an Unless Order regarding disclosure
  2. 2 Whether omission of key documents (scripts) constituted breach of the Unless Order

Ratio Decidendi

The omission to list and disclose the scripts, which were known to exist, highly relevant, and central to the liquidators' case, constituted a clear failure to comply with the Unless Order. The search was not reasonable as required by CPR 31.7, regardless of good faith or methodology, because the scripts were deliberately excluded without ensuring their disclosure. The Unless Order was therefore breached, and the proceedings stand struck out according to its terms.

Court Disposition

Appeal allowed. Proceedings struck out for non-compliance with Unless Order.

Orders

  • Proceedings brought by the liquidators are struck out without further order of the court.
  • Respondents are at liberty to enter judgment for their costs, subject to detailed assessment if not agreed.