Peak Hotels and Resorts Ltd v Tarek Investments Ltd & Ors [2015] EWHC 1997 (Ch) (17 July 2015)

Peak Hotels and Resorts Ltd v Tarek Investments Ltd & Ors [2015] EWHC 1997 (Ch) (17 July 2015)

There has been no material change of circumstances since the Pelling Order to justify releasing any part of the US$ 10 million fortification. The fortification covers all cross-undertakings in damages given by PHRL in these proceedings, not just those relating to capital calls. The Sherway defendants are entitled to the benefit of the fortification. The heads of loss alleged by the defendants are sufficiently plausible that the cross-undertakings may be called upon in significant amounts. It is not unjust or oppressive to hold PHRL to its undertaking.

Citation
[2015] EWHC 1997 (Ch)
Parties
Claimant: Peak Hotels and Resorts Limited; First Defendant: Tarek Investments Limited; Second Defendant: Peak Hotels and Resorts Group Limited; Third Defendant: Sherway Group Limited; Fourth Defendant: Carl Johan Eliasch; First Named Third Party: PHRL Holdings Limited; Second Named Third Party: Omar Sharif Amanat; Third Named Third Party: Lalit Modi
Jurisdiction
England and Wales
Judgment Date
17 July 2015
Procedural Posture
Commercial Chancery Dispute / Interlocutory Applications: (1) for Interim Payment by Sherway Defendants; (2) for Payment Out of Court by PHRL
Outcome
PHRL's Payment Out Application refused. Sherway defendants' Interim Payment Application refused.
Legal Topics
Interim Relief, Cross Undertakings in Damages, Fortification of Undertakings, Security for Costs, Shareholder Disputes, Loan Agreements, Injunctions
Commercial Law Company Law Civil Procedure Interim Relief Cross Undertakings in Damages Fortification of Undertakings Security for Costs Shareholder Disputes +2 more

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Parties

Peak Hotels and Resorts Limited

Claimant

Tarek Investments Limited

First Defendant

Peak Hotels and Resorts Group Limited

Second Defendant

Sherway Group Limited

Third Defendant

Carl Johan Eliasch

Fourth Defendant

PHRL Holdings Limited

First Named Third Party

Omar Sharif Amanat

Second Named Third Party

Lalit Modi

Third Named Third Party

Procedural Posture

Commercial Chancery Dispute / Interlocutory Applications: (1) for Interim Payment by Sherway Defendants; (2) for Payment Out of Court by PHRL

Legal Issues

  1. 1 Whether PHRL is entitled to payment out of US$ 9 million from funds paid into court as fortification for cross-undertakings in damages.
  2. 2 Whether the Sherway defendants are entitled to an interim payment of c. US$ 23 million from PHRL under CPR 25.7.
  3. 3 Scope of the cross-undertakings and fortification: which injunctions are covered and which parties benefit.

Ratio Decidendi

There has been no material change of circumstances since the Pelling Order to justify releasing any part of the US$ 10 million fortification. The fortification covers all cross-undertakings in damages given by PHRL in these proceedings, not just those relating to capital calls. The Sherway defendants are entitled to the benefit of the fortification. The heads of loss alleged by the defendants are sufficiently plausible that the cross-undertakings may be called upon in significant amounts. It is not unjust or oppressive to hold PHRL to its undertaking.

Court Disposition

PHRL's Payment Out Application refused. Sherway defendants' Interim Payment Application refused.

Orders

  • PHRL is not permitted to withdraw any part of the US$ 10 million paid into court as fortification for its cross-undertakings in damages.
  • The Sherway defendants' application for an interim payment of c. US$ 23 million is refused.