The judgment of Mr Justice Nugee in Clydesdale Bank plc -v- Stoke Place Hotel Ltd (in administration) [2017] EWHC 181 (Ch) is another one of those cases we will look at twice.  Both posts will be about the judge’s assessment of witness credibility.  Here we look at the judge’s approach to the defendant’s evidence when the defendant claimed privilege against self-incrimination and the factors that played a part in the overall assessment of of the defendant’s evidence.


  • When a witness in a civil case refuses to answer questions on the grounds that it would incriminate them the court would not draw adverse inferences in relations to their evidence (since that would undermine the privilege).
  • In the absence of any answer, however, the court court has no explanation from the defendant on such matters.
  • The court would, therefore, come to factual explanations in the absence of an explanation from the witness.


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


The case depended, to some extent, on witness credibility. The defendant gave evidence.  The judge had to consider the appropriate approach when the defendant refused to answer questions on the grounds that the answers could be incriminating.

    1. Mr Dhillon did not call any witnesses except himself. I had the advantage of seeing him too being cross-examined at length, in his case over more than 3 days. He did not make a good witness. I am satisfied that many of his purported explanations were untrue, and that he lied repeatedly both to the Bank at the time and to the Court in this action. I have come to the conclusion that his evidence was wholly unreliable and that I am unable to place any weight on it at all, save where supported by contemporary documents or other evidence, or where it is inherently probable.
    2. I do not consider it necessary to set out in exhaustive detail all the matters which have led me to this view of Mr Dhillon’s evidence; I give some examples below when considering the individual claims, and I will refer to two other specific matters here.
    3. Before doing do I should record that Mr Dhillon, on advice, invoked the privilege against self-incrimination and declined to answer certain questions. There was no dispute between the parties as to the law in relation to this, and the following was common ground:
(1) A person called as a witness in civil proceedings in general has a right to refuse to answer any question if to do so would tend to expose him to proceedings for a criminal offence. This is a common law privilege, although statutorily recognised by s. 14 of the Civil Evidence Act 1968.
(2) There is an exception in the Fraud Act 2006, s. 13(1) of which provides that a person is not to be excused from answering any question put to him in proceedings relating to property on the ground that doing so might incriminate him of an offence under that Act or a related offence. The corollary is that under s. 13(2) his answers are not admissible in proceedings for any such offence.
(3) These proceedings are “proceedings relating to property” as defined in s. 13(3) (which includes proceedings for the recovery of money), so that s. 13(1) is potentially applicable.
(4) Some of the areas of questioning of Mr Dhillon undoubtedly raised the question whether he had committed offences which were either offences under the Fraud Act 2006, such as the offence of fraud by false representation (s. 2), or related offences (which by s. 13(4)(a) includes conspiracy to defraud). In relation to such areas of questioning the effect of s. 13(1) was that Mr Dhillon could not rely on the privilege against self-incrimination.
(5) However other areas of questioning raised the question whether he had committed offences which were neither offences under the Fraud Act 2006 nor related offences. I was not told specifically what such offences might be, but possible examples mentioned in argument were offences under the Companies Act 2006. (I also raised the possibility of false accounting, but this is in fact an offence under the Theft Act 1968, and s. 31 of that Act contains a provision similar to s. 13 of the Fraud Act 2006).
(6) In relation to such areas of questioning, Mr Dhillon was entitled to rely on the privilege against self-incrimination.
    1. In these circumstances Mr Dhillon invoked the privilege and, on the advice of Mr Cutting, declined to answer a series of questions put to him by Mr Wilson, who appeared for the Bank. Mr Wilson accepted that no adverse inference should be drawn against Mr Dhillon from the fact that he invoked the privilege. I did not hear any argument on the point but that seems to me to be right: a non-answer is not evidence of anything, and to draw an adverse inference might tend to undermine the privilege. On the other hand, the result of his invoking the privilege is that I have no evidence from him on these questions. That means that I have nothing to set against the inferences to be drawn from such other evidence as there is. In short, I proceed on the basis that Mr Dhillon is entitled to refuse to give any explanation in answer to the various questions asked, and that that is not to be held against him; but that if he chooses to do this, the result of his declining to answer is inevitably that I have no explanation from him in relation to such matters.
    2. I said that there were two specific matters which I would refer to here. The first concerns repeated statements made to the Bank that Mr Dhillon was in the process of selling valuable land in India. Mr Dhillon was born in the UK but his father was born in India, and he told PwC, who prepared a report to go to HMRC for him in January 2010 in relation to his tax affairs, that he had a family property in India which he visited frequently. He said in oral evidence however that this was held between the family (his father’s brothers and so on) and was not a big land holding, and in answer to the question “Did you have any land in India”, he simply said “No”.
    3. The relevance of this is that on 23 May 2008 Mr Ranbir Singh (or Rana) Bains, a solicitor who acted for Mr Dhillon and the Dhillon companies and practised under the style Bains & Co (at that date, according at any rate to his letterhead, with one other partner), wrote to Mr Seavers. The context was that in February 2008 Mr Seavers had been told that Mr Dhillon was looking to move house, and Mr Bains’ letter was part of an attempt to persuade the Bank to make a loan to Mr Dhillon in connection with the purchase of the new house. In it he confirmed, following a telephone conversation of the previous day, that Mr Dhillon was arranging to sell some land in India, that he expected to receive the equivalent of £7.5m on completion, that contracts had been exchanged, that Mr Dhillon had already received a 15% deposit, that Mr Dhillon confirmed that he was the sole proprietor of the land and all the monies would therefore belong to him, and that Mr Dhillon would arrange for his lawyers to let Mr Bains have an undertaking that on completion they would send all the monies to him.
    4. On the basis of Mr Dhillon’s denial in oral evidence that he had had any land in India, every single one of those statements in Mr Bains’ letter was flatly untrue: Mr Dhillon was not arranging to sell land in India, had not exchanged contracts and did not expect to receive the equivalent of £7.5m. If Mr Dhillon is right that he had no land in India, there are logically only three possibilities. Either Mr Bains believed what he was telling Mr Seavers, in which case Mr Dhillon must have told Mr Bains a series of lies; or Mr Bains knew perfectly well that what he was telling Mr Seavers was untrue, in which case he was either doing that in agreement with Mr Dhillon, or without Mr Dhillon knowing anything about it. Only the last of these of course would exonerate Mr Dhillon from being implicated.
    5. On the face of it, it seems unlikely that a solicitor would be willing to lie for a client even if asked to, and even more unlikely that he would lie for a client of his own accord without being asked to; but, as I explain below, Mr Bains undoubtedly told a whole series of lies to the Bank in connection with the Stoke Place transaction, and he has subsequently been struck off for further dishonesty in relation to unrelated matters, so I cannot assume that he acted as one would normally expect a solicitor to, and I am certainly willing to assume that he was telling deliberate lies on this occasion too. But this still does not explain why he would do so on behalf of Mr Dhillon if Mr Dhillon had not asked him to. Mr Dhillon was unable to suggest any reason other than that Mr Bains probably did whatever needed to be said to help the transaction.
    6. That in itself seems fairly unlikely, but it is made much more unlikely by a series of e-mails from Mr Bains to Mr Seavers over the next few weeks. On 2 June 2008, Mr Bains told Mr Seavers that he had enquired of Mr Dhillon and the land in India had been sold to DLF, one of India’s largest housebuilders. On 5 June 2008 he sent Mr Seavers an e-mail attaching a draft of an undertaking to be provided by his firm, titled “Re: Novtej Singh Dhillon – Sale of land in India”. On the same day he sent an e-mail in which he said that Mr Dhillon had confirmed that he would put approximately £500,000 towards the new purchase from the deposit monies he had received for the land in India, which he had lent to someone else and which it would take him 4-6 weeks to get back. On 12 June 2008 he sent another e-mail repeating that Mr Dhillon’s money from India that he received as part of the deposit for the sale of land should arrive within 4-6 weeks, and also referring to an undertaking to send the funds from the sale of the land in India within 9 months. Each of these e-mails was copied to Mr Dhillon. If Mr Bains was really making up the whole story without Mr Dhillon knowing anything about it, it seems extraordinary that he should do that, and thereby risk Mr Dhillon telling Mr Seavers that it was all untrue and so exposing Mr Bains as fundamentally dishonest, unless he knew that Mr Dhillon would not object if he found out.
    7. In fact I think that by far the most likely explanation for Mr Bains copying the e-mails to Mr Dhillon is that Mr Dhillon already knew what Mr Bains was saying to the Bank and was fully in agreement that he should do so. On the basis that Mr Dhillon never had any such land, it follows that Mr Dhillon was quite content for Mr Bains as his solicitor to tell a series of lies to the Bank in order to induce them to make a loan to him.
    8. There is further evidence in this connection which I found particularly telling as to Mr Dhillon’s attitude to the truth. He was asked what he would have done had he found out that Mr Bains was telling lies to the Bank on his behalf. His answers are revealing:
“Q. Listen to my question. Imagine you knew at this time in 2008 that Mr Bains is telling Mr Seavers that you had land in India which you’re selling and you are about to get money out of that. What would you do? Would you tell Mr Bains to correct that?
A. I don’t know, I can’t — I wouldn’t know. I can’t remember actually what I would say.
Q. Just hypothetically, would you wish to correct Mr Bains’ false statement?
A. I might not say anything.
Q. Why?
A. I might not — I might not. I’m not sure. Because I know there’s no land, so what’s the point? There’s nothing —
Q. I’m sorry, if you know your solicitors are lying to Mr Seavers about land in India, why would you not take steps to correct that?
A. The reason is I don’t really see that as any valid point to me, right yes. I’m not expecting any money from India so it’s a nonstarter as far as I’m concerned.
Q. Well, you’re getting an email here, this would be an email that pops into your inbox with the subject “NS Dhillon”, right, you. And the first line mentions land in the Punjab in India. Wouldn’t you say “Hang on a minute, what’s that all about”?
A. Look, as far as I’m concerned, right, there’s no land in India. I didn’t have any land –
Q. Exactly, that’s my point, Mr Dhillon. Wouldn’t that have immediately alerted you to the fact that something very wrong is being said by Mr Bains here?
A. You know what, I can’t recall this fully, right, the conversation, right yes. Maybe I might have said to Rana, you know: what the hell — what’s this all about? And he would probably have said: don’t worry about it. He might have reassured me it’s nothing to worry about. He could have said: look, nothing is going to happen, it’s just to keep — so you could get your transactions sorted out. He might have just told me that story.
Q. My question is if you see this you wouldn’t — you’re saying that if you’d seen this you would still have been reassured simply by Mr Bains saying “Don’t worry about it”. Is that your evidence?
A. To be honest, Rana is an experienced guy, he’s advising me — I was just taking it at face value from him in saying: look, don’t worry about it —
Q. So you would have taken that as a perfectly acceptable explanation?
A. Look, I didn’t probably — the detail of the email I wouldn’t have read. If there was discussions going on between them, fine, there was discussions, fine. I wouldn’t have paid any more attention than that, right yes. Because the real reason is, look, Rana had — it looks like has spun a story here, that’s it. He’s a bit of an entrepreneur, maybe he tells porky pies, maybe he’s something like this, but he’s done it in a way where I go: fine.
Q. He obviously doesn’t have any concern about keeping you in the loop because he’s copying you in on this email. Why is he copying you in on this email if he was telling a lie which you would immediately see as being a complete lie on your case?
A. Look, at the time I might have mentioned it to him and said to him: what’s going on here? And he probably said: don’t worry about it, there’s nothing.”
In other words, Mr Dhillon accepts that he might have spoken to Mr Bains, in which case Mr Bains would probably have reassured him that it was nothing to worry about, that it was just to get his transaction sorted out, and Mr Dhillon would have been content with that. That is in itself an admission that he would have been quite happy to allow his solicitor to lie to the Bank to obtain facilities from them, and speaks volumes as to his regard for the truth.
    1. In fact it does not stop there. About a year later, on 29 May 2009, Mr Bains sent an e-mail to Mr Dhillon. After referring to another matter Mr Bains referred to the completion of “the sale to DLF”; he said the dispute had been settled, and that it might take “a further one or two weeks (India timing)” to finalise the form of order; Mr Dhillon could expect to receive his monies towards the end of July or early August; and that although he would receive some interest, this would be swallowed up by legal costs, adding “Just hope the current riots don’t cause any complications – I spoke to two people there this morning and they say calm has been restored generally and there is no need for any concern.”
    2. This e-mail plainly concerns a sale to DLF taking place in India under which Mr Dhillon was the vendor (or at least had an interest in the purchase monies) and completion of which was due to take place late due to a dispute which had recently been settled. The significant point is that the e-mail was not copied to anyone else. It is not possible to think of any rational explanation why Mr Bains should have written such an e-mail to Mr Dhillon if they both knew that there was no land in India being sold at all. Mr Dhillon was asked about it but simply repeated that he did not have any land in India and had no idea what Mr Bains was going on about. I found this explanation wholly unconvincing. It looks very much as if Mr Dhillon did have land which he sold in India after all, in which case he repeatedly lied to the Court. But whatever the position, I am satisfied that Mr Dhillon has not told the Court the whole truth.
    3. The second specific matter to which reference should be made here concerns financial information in relation to the Dhillon companies which was provided to Mr Seavers. Mr Clark, who I have already mentioned as secretary, along with Mrs Dhillon, of DHL (and in fact of the other companies) had the title of Group Financial Controller from 1999 to 2008, and then from 2008 Group Financial Director, although he was never a director of any of the companies. His role was to collate and report financial information for provision to Mr Dhillon, and to others, including to the Bank; and he often sent financial information to Mr Seavers. There are a number of e-mails from him to Mr Dhillon concerning such information, the natural inference from which is that Mr Clark, at Mr Dhillon’s direction or with his knowledge and approval, was deliberately sending Mr Seavers false figures.
    4. These e-mails were put to Mr Dhillon in cross-examination, but he declined to answer any questions on them in reliance on the privilege against self-incrimination, so I do not have any explanation from him. They are as follows:
(1) The earliest is dated 30 January 2008. Mr Clark sent an e-mail to Mr Dhillon, the subject being “Aged Debts listings”, which attached a listing of aged debts. He said:

“Attached amended listing to be sent to Andrew. I obviously won’t be sending Andrew the earlier sheets which are based upon the actual figures.

Note that the amended figures are slightly below those sent to him on 25/1, which would be reasonable given the receipts this week. I have mainly amended the agency balances in the 60 and 90 day periods and kept the 120 day relatively low.”

The natural inferences from this e-mail are that “Andrew” was a reference to Mr Seavers (Mr Dhillon accepted in another context that a reference in an e-mail to “Andrew” was to Mr Seavers, and there is no evidence of any other plausible contender); that Mr Clark was proposing to send him a list of aged debts which were different from the actual aged debts and which he had deliberately falsified to show what he wanted to show; and that Mr Clark knew that this was something that he could freely disclose to Mr Dhillon, and which had either been done at his request, or at least would meet with his approval.
(2) On 20 October 2011 Mr Clark sent an e-mail to Mr Dhillon, the subject being “Cashflow”. He attached two versions of the anticipated cashflow for each week from the current week (ended 21 October 2011) to the week ended 30 December 2011, one marked “Actual” and the other marked “Andrew”. The latter has different figures from the former for cash inflow each week, and for some other figures (for creditors and taxation/VAT/PAYE), the net effect being to change the amount of weekly overdraft requirements. The natural inference is that Mr Clark, to Mr Dhillon’s knowledge, was proposing to send to Mr Seavers figures for anticipated cashflow that were different from the actual anticipated cashflow.
(3) On 3 August 2012 Mr Clark sent Mr Dhillon an e-mail whose subject was “Andrew figures June”. This e-mail attached spreadsheets, and Mr Clark said:

“I will talk through on Monday morning but in essence I have done the same as last month ie reduced Turnover for CR, Li, P and put costs across the board in Tax and Capex.”

Mr Dhillon replied:

“Laurence create me spread sheet with actuals and Andrew don’t send until I approve.”

The natural inferences are that Mr Clark had falsified the figures that he was going to send to Mr Seavers; that he expected to explain quite what he had done to Mr Dhillon; that Mr Dhillon understood that the figures to be sent to Mr Seavers were not the actual figures; and that Mr Dhillon wished to approve the false figures before they were sent to Mr Seavers.
(4) On 6 August 2012 Mr Clark sent Mr Dhillon an e-mail with the subject “Weekly Cashflow update”. He said:

“Updated Income as attached – Original figures reduced by 20%”

Mr Dhillon replied:

“It can’t go up this much we will have to be careful”

It appears from this that Mr Clark had amended the income shown in the weekly cashflow figures. By itself this could have an entirely innocent explanation, as the cashflow figures were no doubt anticipated future cashflow and there are legitimate reasons why a business might revise its forecasts. But the natural inference from Mr Dhillon’s response is that he thought the amended figures unrealistic, and that they might cause Mr Seavers to become suspicious and uncover the fact that the figures were not genuine.
(5) On 9 August 2012 Mr Clark sent Mr Dhillon an e-mail with the subject “Cashflow 9-8-12”. He said:

“I attach Cashflow up to end of August which I think is fairly realistic… This version is for your info and I will amend it for the bank’s version…

Although I have separated out the Capital/Building costs these only amount to £74k and I assume that you will want to inflate this figure for the bank’s version.”

The natural inferences are that Mr Clark was intending to produce a cashflow for Mr Seavers which differed from his genuine estimate of cashflow; that he expected Mr Dhillon to wish him to do this; and in particular that the Bank’s version of the cashflow would contain inflated figures for capital expenditure.
  1. These e-mails speak for themselves. I am entirely satisfied on the basis of them that Mr Clark was routinely and repeatedly producing deliberately false figures to Mr Seavers; that Mr Dhillon was fully aware of this; that at the very least he was content to allow Mr Clark to do this; and that at any rate in some cases (and I suspect in many more than can be clearly shown) he was actively involved in approving or directing the false figures to be used.
  2. There is other evidence which all points in the same direction; in particular I was taken to evidence which on its face appears to show that the statutory accounts of the companies, which were signed off by Mr Dhillon, were routinely and grossly falsified so as, among other things, to give the appearance, contrary to the facts, that the companies had complied with the financial covenants contained in the Bank’s facilities. It is not necessary to go into the detail. I am satisfied on the basis of the evidence I have already set out, and the other evidence before me, that Mr Dhillon has lied again and again and indeed is a man who regards truth as a merely optional extra when doing business. I see no reason to think that he has any more regard for it when giving evidence, and there was nothing in his performance in the witness box which persuaded me otherwise. As already said, I have concluded that I cannot place any weight on his evidence at all.”