Fraud On The Court: When Post-Trial Evidence Vitiates Judgment (Tinkler v Esken Ltd (Formerly Stobart Group Ltd) [2023] EWCA Civ 655)

• Published date: 26 July 2023
• Law Firm: Gatehouse Chambers
• Author: Mr Rob Hammond

Tinkler v Esken Ltd (Formerly Stobart Group Ltd) [2023] EWCA Civ 655

Background

The Appellant ("Mr Tinkler") was a director, substantial shareholder and former CEO of the Respondent ("SGL"). He stepped down as CEO in 2017 to focus on investment activities through a related entity ("SCL") in which he was a majority shareholder. SCL's remaining shares were held by Mr Soanes, another of SGL's board members.

In 2018, a boardroom dispute arose between Mr Tinkler, on the one hand, and SGL's Chair ("Mr Ferguson"), its new CEO ("Mr Brady") and Mr Soanes. In May 2018, Mr Soanes brought proceedings against Mr Tinkler and SCL for constructive dismissal (the "Employment Proceedings"). In June 2018, Mr Tinkler was summarily dismissed from his directorship and employment at SGL, for breach of his fiduciary duties. Mr Tinkler was promptly re-elected to SGL's directorship by its shareholders, but in July 2018, SGL's board again dismissed Mr Tinkler under an express power within the articles of association.

The validity of the dismissals was put before HHJ Russen QC in late 2018. Mr Tinkler's case was that his former board colleagues had formed a "premeditated plan" to remove him from SGL. In November 2019, HHJ Russen dismissed Mr Tinkler's claims.

In April 2020, the Employment Proceedings were also dismissed. The Tribunal's decision, however, caused Mr Tinkler to review Mr Soane's disclosure. He discovered communications between Mr Soanes and Mr Brady, allegedly evidencing the "premediated plan" tried by HHJ Russen. The documents had not been disclosed in those proceedings. Mr Tinkler therefore brought claims to set aside HHJ Russen's judgment on the basis that it had been procured by fraud.

The Court Below

The elements of a claim to set aside a judgment procured by fraud were not disputed before Leech J ('the "Judge"): (i) the successful party must commit conscious and deliberate dishonesty ("Limb 1"), (ii) the dishonest conduct must be material to the original decision ("Limb 2"), and (iii) there must be new evidence before the Court ("Limb 3" collectively, the "Test").

Counsel for Mr Tinkler invited the Judge to decide afresh inter alia the main factual issue resolved by HHJ Russen (whether the board had formed a premeditated plan to remove Mr Tinkler). Although, as below, this approach would lead to confusion, SGL did not object.

Accordingly, the Judge addressed the issues by: (i) identifying any relevant findings made by HHJ Russen; (ii) identifying the new evidence...