The High Court allowed amendments to three connected proceedings arising from the collapse of the Cunningham Group of Companies, including proposed claims alleging that First Active plc fraudulently procured additional securities. The allegations remain disputed: First Active denied them, and the court made no finding on their merits.
In a judgment delivered on 7 September 2007, Mr Justice Clarke considered applications to amend two Porterridge Trading Limited cases and the main Mooreview proceedings. Porterridge challenged the sale of property at Bailey Point, Salthill Road, Galway, to Bernard Duffy. The broader Mooreview litigation concerned allegations by Brian Cunningham and associated companies of wrongful conduct connected with a receivership and an alleged failure by First Active to provide agreed financial support. Those allegations were also denied.
The proposed fraud amendments relied on documents obtained through discovery in the Mooreview proceedings. The judge accepted that the court should first have been asked to release the plaintiffs from the implied undertaking restricting use of those documents. He nevertheless declined to bar their use, concluding that the release would have been granted in the circumstances.
The judge said it was not appropriate at this stage to assess the strength of the fraud allegations. He could not conclude that the amended claims were bound to fail. He allowed the fraud-related amendments and consequential matters, finding that potential delay and other prejudice could be addressed through case-management measures. He also allowed other proposed amendments, despite the absence of a real explanation for why most had not been pleaded earlier, because he considered that they would cause no real prejudice.
There were limits. Amendments directly affecting Ray Jackson were not treated as permitted unless he agreed to them or the judge directed their inclusion after hearing the parties at the next case-management meeting. The Mooreview plaintiffs were directed to provide defendants, including Duffy, with the definitive statement of claim. The judge also invited the parties to rationalise the particulars in the pleadings.
The plaintiffs were given two weeks to identify any further discovery categories and outstanding interlocutory issues. They were given three weeks to list the issues arising across the proceedings; defendants then had a further two weeks to identify additional issues. The court directed that the connected proceedings be tried in a single sequence, with the order to be settled after hearing the parties. A further case-management hearing was envisaged for the latter part of Michaelmas Term. The trial was provisionally fixed to begin on 8 April 2008.
The court did not make a final costs order. The judge said defendants could seek costs arising from the amendments at the October case-management meeting, after giving the plaintiffs’ solicitors at least two weeks’ notice of the order sought.