By Luke Patel
Readers of this publication may recall the case of Asturion Foundation v Alibrahim from last year which clarified the position on the “warehousing” of claims and whether that practice constituted an abuse of process.
By way of a recap, Asturion was a Liechtenstein foundation created to hold and manage properties on behalf of a Prince of Saudi Arabia and, Ms Alibrahim, was the widow of the Prince.
One of the properties had been transferred to Ms Alibrahim by a member of the foundation, who asserted that he had acted on the basis of oral and written instructions given by the late Prince.
Asturion claimed that the transfer was void under both English and Liechtenstein law and sought the return of the property.
The claim was issued in April 2015 and a defence was served but no substantive steps were taken by Asturion to progress the litigation.
Ms Alibrahim succeeded in having the claim struck out but that decision was overturned by the High Court which concluded that Asturion’s decision to suspend the progress of its claim against Ms Alibrahim did not amount warranting the claim to be struck out. Ms Alibrahim subsequently appealed that decision.
The appeal was recently heard by the Court of Appeal and it was dismissed. The Court found that a unilateral decision by Asturion to delay pursuing the claim once it has been issued would not automatically amount to an abuse of process.
Instead, the courts had to consider the reason for the decision to pause the proceedings and the length of any delay before coming to the conclusion that it constituted an abuse of process.
The Court of Appeal made it clear that even if the decision could be said to amount to an abuse of process there may be alternative sanctions to striking out the claim which would be more commensurate to the abuse in question.
The Court of Appeal found that in the present case if there had been an abuse of process then it was a relatively minor one and that there were alternative sanctions available such as costs penalties and the parties being given strict directions to progress the claim to trial.
Notwithstanding this decision, “warehousing” a claim is a dangerous tactic for a Claimant to adopt.
Although it will not be treated automatically as an abuse of process it will still be viewed dimly by the courts and there are likely to be costs sanctions levied against the Claimant who pursues such an approach.
Blacks Solicitors can provide assistance on all aspects of civil and commercial court proceedings. If you require advice then please contact Luke Patel on 0113 227 9316 or by email at “LPatel@LawBlacks.com”