The judgment of Mr Justice Nugee in Clydesdale Bank plc -v- Stoke Place Hotel Ltd (in administration) [2017] EWHC 181 (Ch) also contains an analysis of a witness who was “something of an enigma”

“Although a witness statement should be in a witness’s own words, it is a fact that they are often drafted for witnesses and it would be foolish to pretend otherwise”.


  • A witness for the claimant stated that parts of an earlier witness statement was untrue, he could not identify precisely which parts he was referring to.
  • The court considered the evidence in full, including the fact that the witness had committed acts of dishonesty and made inconsistent statements, it found that despite this the evidence of the witness could largely be accepted.



The bank was bringing an action against the defendants for facilities it provided to a large number of companies.  . A manager at the bank, Mr Seavers, had engaged in extensive unauthorised lending of over £17 million.

    1. The one witness for the Bank that I should say something specific about is Mr Seavers. He is something of an enigma. He joined the Bank in August 1977, so by June 2008 when he made his first unauthorised loan to the Dhillon companies, he had worked for the Bank for over 30 years, and had been a relationship manager, a senior and responsible position, since at least 1992 or 1993 when he first met Mr Dhillon, if not before. The Bank’s witnesses who knew, or knew of, him referred to him in largely similar terms. Mr Leo, who worked for him as an associate for two years, said that he was very professional, a good supervisor and mentor, a very experienced banker who taught him a lot and whom at the time he considered to be an excellent role model; his approach to everything was well thought out and well conducted; he did not make rash decisions. Mr Johnson, who worked for him for over a year, said he was very well respected, a dominant personality but not a bully, a professional, traditional banker, and organised in his approach. Mr Gallie, who was Managing Partner of the FSC for over 6 years, said he was calm and considered, very well respected, a steady performer who consistently had good appraisals. His perception was that he taught his staff to do things properly; there was always a calm atmosphere around him and his associates. The feedback from the Credit team was generally good: he was seen at the time as a role model from a risk and control perspective. Mr Gold did not know him particularly well, but knew that his local reputation was that of an experienced and trusted Business Partner (although his credit submissions were not the most detailed and Level 2 had to provide more support than he would have expected). Mr Duncan, who had known of him since the 1990s, viewed him as one of the ‘old guard’, a steady career banker who could usually be called on to display sensible credit judgment.
    2. The contrast between this perception of him as a safe pair of hands, and the reality that he single-handedly lost the Bank the astounding sum of over £17m by deliberately and repeatedly lending without the slightest authority to do so, in breach of his contract of employment, in breach of his fiduciary duties and in breach of the most basic principles of banking, and compounded matters by thereafter concealing what he had done, could not be greater. It is unsurprising in these circumstances that Mr Cutting submitted that he was a man on whose evidence no credibility could be placed whatever. He relied in particular on the following:
(1) Mr Seavers had made a witness statement in opposition to an application for summary judgment against him. In his witness statement for trial, he said that he no longer maintained a number of contentions in that statement, but, when asked to identify which of the statements in his earlier statement he no longer maintained, he could not do so. That, it was suggested, meant that his statement for trial was untrue. Mr Seavers explained the particular passage in his witness statement as having been insisted on by the Bank’s lawyers, which Mr Cutting naturally submitted raised the question of what else had been.
(2) Mr Cutting put to him that his actions had been dishonest. Mr Seavers accepted, as he had in his witness statement, that he had acted in breach of his duties to the Bank, but was reluctant to accept the charge of dishonesty. He said that he was helping a business that had employees, which was returning an income for the Bank. He was anticipating the proceeds of sales of assets that would have cleared this in full, but pending that, it was necessary to keep the business going and pay the wages.
(3) Mr Cutting put to him that he had taken steps to conceal the unauthorised lending from the Bank. He accepted this, and that he had for example failed to disclose the unauthorised lending in credit submissions. He also accepted that he rolled up the (unauthorised) Treasury loans into a new (unauthorised) facility called the Property Development Facility (“the PDF”) as a means of continuing to conceal his actions. If he had not done this, they might have come to light.
(4) Finally, Mr Cutting put to him that he was gambling at the casino table, as it were, with the Bank’s money in the hope that by buying more chips he would eventually win – that is that the sale of assets would enable everything to come right without his dishonest actions being discovered – or in other words that he was gambling with the Bank’s money to save his own skin. Mr Seavers accepted that this was one way of putting it.
  1. I do not place any particular weight on the first of these points. Although a witness statement should be in a witness’s own words, it is a fact that they are often drafted for witnesses and it would be foolish to pretend otherwise. I can well understand why the Bank’s lawyers wished Mr Seavers to make some such statement: one of the things he had said in his witness statement opposing summary judgment was that he had not been involved in any concealment, which was at odds with his witness statement for trial where he admitted at times concealing the existence and nature of the lending. I do not regard this particular point as assisting one way or another in assessing Mr Seavers’ general credibility.
  2. I have no hesitation however in accepting that Mr Seavers’ actions were dishonest. The money which he lent to the Dhillon companies was not his but the Bank’s. The loan of money always involves a risk that it will not be repaid, and he had no right to take that risk with the Bank’s money. He knew perfectly well that he had no authority to lend it, and hence no right to take that risk. That by itself seems to me well within the ordinary understanding of what it is to act dishonestly, quite apart from his repeated concealment of his actions in not referring to the unauthorised facilities in credit submissions, and taking active steps to continue that concealment by rolling the unauthorised loans over, and then into the PDF. The fact that he hoped and expected that the Dhillon companies would by one means or another be able to repay the unauthorised lending, and thought that in doing so he was helping to preserve a viable business and the jobs of its employees, are in this context neither here nor there.
  3. It is very difficult to understand how an experienced and well-respected banker could ever have got himself into this position. The closest Mr Seavers came to giving an explanation was that he was not in his normal, right-thinking mind because he was under stress; and that in the early stages, he thought the aberration (as he called it) would simply be corrected and they could all carry on with proper sanctioned facilities. That suggests that matters then got out of hand and he could not see a way out. That chimes with something he said when matters came to light and he was interviewed by Mr Gallie on 4 July 2012, where, after admitting the unauthorised lending and describing it as irrational, he described himself as “in a spiral that you can’t see your way out of”.
  4. In the light of what I have said about his conduct, which inevitably involved not just keeping quiet about what he had done but telling lies about it in credit submissions, I have naturally approached his evidence with the utmost caution. But I have also had the advantage of seeing him being cross-examined at some length in the witness box. Rather against my expectations, I found him a measured and careful witness, who gave every appearance of trying to assist the Court with the best of his recollection. His explanations of the contemporary documents were usually sensible and believable – I give some examples below. He undoubtedly found it difficult to explain how he had come to throw away his career, and a great deal of the Bank’s money, in the way he had, but when it came to what had happened – his evidence as to what he and others had said and done – I found his accounts straightforward, coherent and credible.
  5. In his interview with Mr Gallie, he said two other things, neither of which has been shown to be untrue. First, that this was a one-off: when Mr Gallie asked him if there were any other facts that should come out, he replied that there was nothing else, either on Dhillons or anything else. There is no evidence contradicting that. I accept therefore that this appears to have been an isolated episode – albeit an extended, very serious and career-destroying one – in an otherwise respectable career. Second, he said that he had not profited personally from it – he had not taken a penny. Again there is no evidence contradicting that – the Bank has devoted considerable resources to tracing what happened to the money lent to the Dhillon companies but there is no suggestion that any of it found its way to Mr Seavers, and no other evidence of his having benefited financially. In his witness statement he disclosed that he had in fact had some minor personal benefits from his connection with Mr Dhillon: Mr Dhillon used to invite him to Stamford Bridge as his guest to watch Chelsea, and occasionally invited him to make use of his corporate hospitality package there when he was unable to attend; and in 2007 when Mr and Mrs Seavers celebrated their silver wedding anniversary at Stoke Place, they were not charged for the room or the food. But these are minor matters that cannot realistically be taken as any sort of reward for disloyalty – the silver wedding indeed was some time before the unauthorised lending started.
  6. Nor is there any suggestion that Mr Seavers has agreed to give evidence for the Bank in return for being let off his liability. On the contrary, having obtained summary judgment against Mr Seavers on 30 January 2015 for over £17m, the Bank has proceeded to enforce the judgment, and has received various sums from the execution of a writ of control, from the sale of Mr Seavers’ property and from Mr Seavers’ pension, the entirety of which has been forfeited. The total recovered is in excess of £1.25m.
  7. Taking account of everything, including in particular the impression which I formed of him giving oral evidence, and despite the obvious suspicion which his dishonest actions inevitably cast over his credibility, I have come to the firm conclusion that his evidence is in general evidence that I can and should accept, although I will naturally test it in any particular instance against the contemporaneous documents and inherent probability.