Sub 20 Ltd v Royalton Investment Limited & Ors
[2024] EWHC 907 (Comm)
British International Investment Plc v Sunny Varkey & Anor
24 May 2024
[2024] EWHC 1785 (Comm)
High Court
A company successfully sued two individuals for not paying a large debt. The court ruled quickly because the people being sued ignored the lawsuit entirely, showing they had no valid defense. The court ordered them to pay the debt, plus interest, and their legal costs. It made it easy to serve the court papers since the defendants didn't follow the usual rules for receiving official documents.
Key Facts
- •British International Investments Plc (BII) sought summary judgment against Sunny Varkey and Varkey Group Limited (VGL) for unpaid sums under a share and loan note purchase agreement.
- •Varkey failed to meet payment obligations under the agreement, which was governed by English law and contained a jurisdiction clause.
- •VGL acted as guarantor for Varkey's obligations.
- •BII had initiated enforcement proceedings in the UAE against Varkey, recovering some funds.
- •Neither defendant acknowledged service, filed a defense, or appeared at the summary judgment hearing.
Legal Principles
Summary judgment can be granted if the defendant has no real prospect of succeeding on any defense and there is no other compelling reason for a trial.
Part 24 of the Civil Procedure Rules
Permission to apply for summary judgment can be granted even before acknowledgment of service or a defense is filed, especially if the defendant shows no intention of engaging with the proceedings.
CPR 24.4, Phillips v. Avena [2005] EWHC 3333 (Ch)
Declaratory relief may be granted if it serves a useful purpose, special reasons exist, and the legal basis is present.
MMD Mining Machinery Developments Limited v. Lang [2021] EWHC 3264 (Comm)
The court may authorize alternative service methods if the defendant fails to comply with agreed-upon service provisions (e.g., appointing a service agent).
The Society of Lloyd's v. Tropp [2004] EWHC 33 (Comm)
Costs may be awarded on an indemnity basis if the defendant's conduct is unreasonable.
CPR 44.5
Outcomes
Summary judgment granted for BII against both defendants for the claimed principal, interest, and default interest.
Defendants had no real prospect of successfully defending the claim and no compelling reason existed for a trial. The defendants' failure to engage with the proceedings was deemed a deliberate tactical decision.
Declaratory relief granted, confirming that Varkey and VGL must indemnify BII for costs, losses, and liabilities resulting from the breach of contract.
The declaration serves a useful purpose and the legal basis for it was established.
Costs awarded to BII on an indemnity basis, with an interim payment of £100,000.
Defendants' unreasonable conduct (failing to appoint service agents, not engaging with the proceedings) warranted the indemnity costs. The exceptionally high cost bill prompted a detailed assessment of costs, rather than a summary assessment.
Alternative service methods authorized for the judgment, including emails to four specified addresses.
Justified by defendants' prior breach of contract to appoint a service agent and their subsequent refusal to engage with the proceedings.
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