David Brounger represented a property developer who successfully brought a claim in the High Court against his former business associate for breaches of undertakings given to the court.
Background to the claim
The parties were former business associates, working in property development.
Following a claim by the claimant that the defendant owed him a substantial sum of money, a compromise agreement was reached in July 2020, whereby the defendant was to pay the claimant the sum of £1.5 million by July 2023. The agreement also required the defendant to provide security over various properties.
When the defendant did not comply with the compromise agreement, new proceedings were issued to enforce the agreement. These proceedings were settled by way of a Tomlin order and the defendant gave undertakings to the court not to sell, charge or otherwise deal with 12 properties that were in his name or in the names of companies of which he was a director.
The defendant then charged several of the properties that were the subject of the undertakings, without the consent of the claimant.
The claim
On the claimant’s behalf, David argued that the defendant had breached his undertakings to the court.
The defendant denied the breaches and on his behalf it was argued that:
- the undertakings formed part of the Tomlin order and so could not be enforced by a contempt application
- the defendant did not fully understand the undertakings he had given
- the defendant could not be bound by undertakings given by him in relation to properties owned by companies that were not parties to the claim
- as a result of the claimant’s refusal to grant consent to charges it was impossible for the defendant to comply with the undertakings
- that any breach did not amount to a deliberate flouting of the undertakings.
Judgment
The judge found against the defendant on all points, and he was held to be in deliberate and contumacious breaches of the undertakings in respect of 3 transactions.
The defendant was sentenced to 6 months' imprisonment, suspended for 2 years on stringent conditions relating to the disclosure of his assets. He was also ordered to pay indemnity costs.
Read the full judgment in O'Leary v Daniel - Courts and Tribunals Judiciary.