The Administrative Court has been asked to consider whether the quashing of summonses was unlawful on the basis that it was wrong in law and/or irrational, and in doing so has had to consider a private prosecutor’s duty of candour, and motive for bringing a prosecution.
The claimant private prosecutor sought to challenge the decision of the Deputy Senior District Judge at Westminster Magistrates’ Court to set aside summonses against his uncle (the First Interested Party) and cousin (the Second Interested Party). The claimant had sought to prosecute the First and Second Interested Parties for fraud by abuse of position in relation to a family-owned company, Station Hotel (Newcastle) Limited (“SHNL”). SHNL was founded by Rohan Handa, the claimant’s grandfather, and father of the First Interested Party. The claimant and his father were minority shareholders in the company, owning 45 per cent. The First and Second Interested Parties held the other 55 per cent.
The claimant had previously been removed as a director of SHNL for gross misconduct and had brought a claim for unfair dismissal on the basis that he had made protected disclosures which inter alia alleged fraud by the First and Second Interested Parties.
The claimant applied for summonses against his uncle and cousin for fraud by abuse of position, alleging that they had misrepresented that invoices paid by SHNL were for purchases made by and for the benefit of SHNL. The claimant alleged that the invoices were in fact for (i) personal business ventures and (ii) for expenses relating to the Second Interested Party’s wedding. The alleged loss to SHNL, net of VAT, was £592,000. The claimant also alleged that VAT was incorrectly reclaimed by SHNL (as the invoices were not in fact for the SHNL business).
The First and Second Interested Parties applied to have the summonses set aside on the basis that the claimant’s motive meant the prosecution was being brought for an improper purpose.
The law
As per the well-known case on the issue of summonses, R (Kay) v Leeds Magistrates’ Court [2018] EWHC 1233 (Admin) at [22], if the relevant conditions are satisfied then a summons ought to be issued “unless there are compelling reasons not to do so”. The relevant conditions, being (i) the essential ingredients of the offence are prima facie present, (ii) the allegation is not out of time, (iii) the court has jurisdiction, and (iv) the applicant has the necessary authority to prosecute. Compelling reasons not to issue the summons include where the application is vexatious, an abuse of process or is otherwise improper. An example of a vexatious application would be one involving the presence of an improper ulterior motive. Thus, proper disclosure is required to the court to allow it to make such a determination.
In relation to whether or not quash a summons, two tests are discussed in Kay: whether the breach of the duty of candour by a private prosecutor “would” or “might” have made a difference to the decision to issue the summons. The Honourable Mr Justice Murray in the Handa case noted that the conflict in case law as to these two tests has not yet been reconciled.
The case of R (Siddiqui) v Westminster Magistrates’ Court [2021] EWHC 1648 (Admin), [2021] 2 Cr App R 25 (DC) is well known on this issue, however in terms of which of the two tests to apply, Siddiqui had found that the relevant non-disclosure had made a difference to the district judge’s decision, so which of the tests to apply was not considered. The court rather had to consider whether the prosecutor’s non-disclosure “should” have led to the decision to quash the summons.
Prima Facie Case
Before turning to the claimant’s motive and compliance with the duty of candour, Mr Justice Murray briefly considered whether there was a prima facie case, albeit he was not asked to consider this issue and so made no definitive findings. Whilst the District Judge appeared to find that a prima facie case did exist, it was noted that his judgment was somewhat unclear. In considering this, Mr Justice Murray said: “I should note that I have serious doubts as to whether the Judge was correct to find a prima facie case against both interested parties…if he did so find.” On this basis alone, it is therefore questionable whether the summons ought to have been granted in the first place, regardless of the claimant’s motive.
Oblique motive / improper purpose
The focus of the District Judge’s judgment turned to the following questions, as posed by Mr Justice Murray: “Has D1 and D2 (upon whom the burden lies) satisfied the Court that there are compelling reasons to find that the allegations are vexatious or that the issue of the summonses would involve an abuse of the process of the court: either (a) on the ground that the proceedings are vitiated by an oblique motive which is so dominant and so unrelated to the proceedings that it renders them an abuse of process; or (b) on grounds of failure to comply with the duty of candour.”
In considering these issues, he noted that the District Judge found that there was evidence of a “clear lack of understanding” which suggested “a lack of understanding of the concept of candour in the context of a criminal prosecution”. Albeit, he noted that claimant himself bore ultimate responsibility for compliance with the duty of candour.
The crux of the duty of candour failings was in relation to a lack of disclosure, when applying for the summonses, of a true picture of the relationship between the claimant, the First and Second Interested Parties, and other relevant family members. This therefore denied the court an opportunity to consider the claimant’s dominant motive for bringing the private prosecution. The case summary filed with the application had simply referred to the relationships becoming “a bit strained” which the District Judge noted was a gross understatement and clearly untrue. In fact, it later became known, inter alia, that (i) the claimant was prepared to do almost anything to prevent him and his father having a minority shareholding, (ii) he had called his own father an idiot, weak and renegading under pressure and that after his father told him that he and the staff were petrified, the claimant wrote “there ain’t no sunshine when it rains”, and (iii) an independent consultant brought in to split the business said “trust issues inhibiting productive working relationships’ and ‘Neeraj’s [the claimant’s] long standing hatred for Aran [the Second Interested Party and uncle] made him totally irrational.”
The District Judge found that the non-disclosure was deliberate: “… it was deliberate in that the case summary presented the case in the most favourable way to the prosecutor and was designed to do so. It was not an oversight or by accident.” He then concluded that the non-disclosure “might” have made a difference as to whether the summons was issued or not before considering the motive of the private prosecutor. He found:
- the claimant failed to disclose the true extent of the animosity between himself and his family including the First and Second Interested Parties.
- the “real and dominant motive” behind the claimant’s application for a summons was “to seek to destroy through criminal prosecution the other wing of the family who P had come to despise” because they were making commercial progress, and his side was being left behind.
- the claimant’s application for a summons did not fairly state “the degree of ‘bad blood’ and “what can only be described as hatred”.
- the claimant was not interested in the outcome of an independent review of the evidence supporting his allegations.
- The claimant’s honesty was questionable, evidenced by the similarity between his witness statement and that of his main witness, which suggested a degree of collusion.
In so finding, the District Judge found the primary motive to be wholly spiteful and improper. Therefore, he concluded that the claimant had not and would not discharge his obligations as a prosecutor and minister of justice, fairly, honestly and objectively. He set aside the summonses on the basis that the private prosecution was an abuse of process.
The Administrative Court Judgment
The claimant’s grounds of challenge were:
- Ground 1: it was irrational to find that any breach of the duty of candour by the claimant was deliberate.
- Ground 2: the findings regarding the claimant’s motive for bringing the prosecution were irrational.
- Ground 3: the District Judge was wrong to conclude that the claimant’s motive was so oblique as to require the Summonses to be set aside.
- Ground 4: the District Judge’s findings as to the integrity of the claimant were irrational.
- Ground 5: the District Judge was wrong in law to conclude that the claimant’s conduct in applying for the Summonses amounted to an abuse of process.
Mr Justice Murray found little merit in any grounds of these grounds. He concluded:
- there was nothing irrational or otherwise unlawful about the conclusion that the claimant’s breach of his duty of candour was deliberate. It was not good enough for adverse material to have been buried in the 800 or so pages of documents accompanying the claimant’s applications for the summonses (emphasis added). The District Judge entitled to find the claimant had failed to be transparent and had positively misrepresented the true position.
- The findings about the claimant’s motive for bringing the prosecution were not irrational. In fact Mr Justice Murray said it would have been surprising if the District Judge had reached a different view.
- The District Judge was correct to focus on the claimant’s application for the summonses, having satisfied himself that it was abundantly clear that the prosecutor had failed to be frank in his case summary.
- The District Judge had a rational basis to conclude that there was a serious doubt about the integrity of the claimant and therefore his ability to discharge fairly, honestly, and objectively his obligations as a prosecutor and minister of justice.
- The claimant had failed to demonstrate that the District Judge was wrong in law to conclude that his conduct in applying for the summonses amounted to an abuse of process. The District Judge was entitled to set aside the summonses given the claimant’s failure to disclose information as to his true motive in bringing the prosecution and other relevant information material to the question of his suitability to act as private prosecutor. The claimant’s dominant motive, to damage the Interested Parties, would render the prosecution an abuse of process.
The case again highlights the importance of a private prosecutor’s duty of candour and sits alongside a line of authority on how the importance of a private prosecutor’s duty of candour cannot be overstated. The duty must be discharged fully at the time of applying for a summons and burying documents amongst pages of disclosure will not be considered candid.
For more information or enquiries about Private Prosecutions, please contact us at enquiries@emmlegal.com.
