The judgment of Andrew Lenon QC in  Kings Security Systems Ltd v King & Anor [2021] EWHC 325 (Ch) contains a detailed consideration of the tort of “bringing proceedings for an improper purpose”. This tort (may well) still exist, however it has only succeeded in two cases, the most recent being in 1868. (One feature of this case is that the claimant had incurred costs of £2.5 million and recovered damages of £45,666.47 (it being argued that it was the defendant’s own actions that led to the action becoming much more complex and costly).


The claimant company brought proceedings against the defendant, a former director of the company alleging breach of duty in the way that the company had funded a use of a Range Rover. That action was successful.  The defendant, however, counterclaimed on the grounds that the claimant had committed the tort of bringing an action for an improper purpose – that being (in essence) to pressurise him into selling his minority shareholding in the company.


“whilst there is no doubt that costs spent by KSSL on these proceedings, which I understand are in the region of £2.5 million plus VAT, are grossly disproportionate to the relatively small amount at stake, this does not support the contention that the proceedings were brought for the purpose of obtaining the King Family Shares”.



  1. Apart from a claim for payment of £70,000 pursuant to the Settlement Agreement, which cannot succeed given my decision as to the rescission of the Settlement Agreement, Mr King is counterclaiming damages on the basis that KSSL has committed the tort of abuse of process, as recognised in Grainger v Hill (1838) 4 Bing N.C. 212, by commencing and pursuing these proceedings for collateral and improper purposes. 
  1. These purposes are alleged to be:
(1)             to enable its ultimate controlling parent company, Primekings, to obtain the shares in KSGL held by Mr King and the family trust, together with the B shares held by Mr King’s parents  at a gross and/or very substantial undervalue, by using these proceeding to place stress, distraction, financial and emotional pressure on Mr King whilst simultaneously pursuing charging orders and subsequently Part 8 Proceedings  against him, his parents, and the trust for the sale of the King Family Shares; and/or
(2)             to inflict serious and gratuitous damage to Mr King’s reputation, with the intention of thereby preventing him from obtaining any other employment commensurate with his experience and/or competing in future with KSSL’s business, by using these proceedings to provide a platform for the purpose of publicising the allegations against Mr King herein as widely as possible.
  1. Mr King’s pleaded claim is that he has incurred the costs and expenses of defending the claim and damage to his reputation. There is also a claim for aggravated and exemplary damages.
KSSL’s response to the Counterclaim
  1. KSSL’s case in response to the Counterclaim is, in summary, as follows.
(1)         It is questionable whether the Grainger v Hill tort still exists as it has not been successfully invoked since the Judicature Acts. The case should now be seen as an instance of malicious prosecution, in which the pursuit of an unjustifiable collateral objective was evidence of malice, rather than as a separate tort.
(2)         In any event, KSSL did not commence or pursue these proceedings for collateral and/or improper purposes. The decision by KSSL to initiate and pursue these proceedings was taken by KSSL’s non-executive directors with the full knowledge of the executive directors in the best interests of KSSL for the proper purposes of seeking compensation from both defendants for the losses suffered by KSSL, vindicating KSSL’s rights, protecting KSSL’s reputation and showing that KSSL would not tolerate behaviour of the kind perpetrated by the defendants.
(3)         Mr King has not pleaded or proved any recoverable loss.
  1. The issues on the Counterclaim are accordingly:
(1)         Is the Grainger v Hill tort of abuse of process still recognised in English law and, if so, what are the elements of the tort?
(2)         Does the evidence establish that KSSL committed the tort?
(3)         Has Mr King pleaded or proved any recoverable loss?
Issue (1): Is the Grainger v Hill tort still part of English law?
  1. The facts of Grainger v Hill, in which the tort of abuse of process was first recognised, were, in summary, that the claimant had mortgaged his vessel to the defendant with the mortgage debt payable after a year. In the meantime, the claimant was to retain the register of the vessel in order to pursue his voyages. Before the date for repayment of the debt, the defendants, who were concerned about the sufficiency of their security, decided to get hold of the ship’s register and for this purpose brought assumpsit proceedings against the claimant, threatening him with arrest unless he could provide bail or the ship’s register. The claimant gave up the register and repaid the loan. He subsequently sued for the loss caused by his inability to carry on business because of the defendants’ conduct. The defendants applied to non-suit the abuse of process claim on the ground, amongst others, that it had not been established that the original proceedings had been determined against them.
  1. The Court of Exchequer Chamber dismissed the non-suit on the grounds that it was immaterial whether the defendant’s proceedings had been determined and whether or not it was founded on reasonable and probable cause. Proof that the defendant’s proceedings had been found to be without reasonable or proper cause would be essential elements for an action for malicious arrest or malicious prosecution but the claim in this action was for abusing the process of the law. The abuse consisted of applying the process of law for the ulterior purpose of obtaining by duress the ship’s register, to which the defendants had no claim and which was not within the scope of the court’s process. 
  1. A similar conclusion was reached in Gilding v Eyre (1861) 10 CBNS 592, although Grainger v Hill was not mentioned. The defendant brought proceedings in order to extort money which he knew had already been largely paid by the claimant under an earlier judgment. The Court of Common Pleas rejected the defendant’s contention that the abuse of process claim was not sustainable because the original proceedings had not terminated in the claimant’s favour.
  1. Goldsmith v Sperrings Ltd [1977] 1 WLR 478 is the first of a series of cases in the modern era in which the Grainger v Hill tort has been considered. Sir James Goldsmith brought proceedings against wholesale and retail distributors of the magazine, alleging libel. The distributors applied to strike out the proceedings as an abuse of process on the ground that the claimant’s purpose in pursuing the action was not to protect his reputation but to destroy the magazine by cutting off its retail outlets. The application failed. The majority of the Court of Appeal (Scarman LJ and Bridge LJ) were not satisfied on the facts that the claimant’s purpose was other than to vindicate his reputation.
  1. Lord Denning MR held as follows (page 489C):
“In a civilised society, legal process is the machinery for keeping and doing justice. It can be used properly or it can be abused. It is used properly when it is invoked for the vindication of men’s rights or the enforcement of just claims. It is abused when it is diverted from its true course so as to serve extortion or oppression: or to exert pressure so as to achieve an improper end. When it is so abused, it is a tort, a wrong known to the law. The judges can and will intervene to stop it. They will stay the legal process, if they can, before any harm is done. If they cannot stop it in time, and harm is done, they will give damages against the wrongdoer.”
  1. Bridge LJ held as follows in relation to the concept of “collateral advantage” in the context of the tort of abuse of process (503F):
“In my judgment, one can certainly go so far as to say that when a litigant sues to redress a grievance no object which he may seek to obtain can be condemned as a collateral advantage if it is reasonably related to the provision of some form of redress for that grievance. On the other hand, if it can be shown that a litigant is pursuing an ulterior purpose unrelated to the subject matter of the litigation and that, but for his ulterior purpose, he would not have commenced proceedings at all, that is an abuse of process. These two cases are plain; but there is, I think, a difficult area in between. What if a litigant with a genuine cause of action, which he would wish to pursue in any event, can be shown also to have an ulterior purpose in view as a desired by product of the litigation? Can he on that ground be debarred from proceeding? I very much doubt it. But on the view I take of the facts in this case the question does not arise and it is neither necessary nor desirable to try to lay down a precise criterion in the abstract.”
  1. In Digital Equipment Corporation and another v Darkcrest Ltd [1984]1 Ch 512 Falconer J dismissed an appeal against the striking out of paragraphs in a Counterclaim which alleged that the proceedings, in which an Anton Piller order had been obtained on misleading evidence, were an abuse of process Falconer J questioned whether the Grainger v Hill tort had “passed into desuetude and disappeared” but held that, even assuming such a cause of action existed, the present claim was distinguishable on the facts as no question arose of the claimant seeking to abuse the process of the court for the purpose of obtaining property to which it had no right or any other improper purpose.
  1. In Broxton v McClelland and another [1995] EMLR 485 Drake J had struck out a libel claim as an abuse of process on the basis that the claimant’s objective was to secure the defendant’s financial ruin. The Court of Appeal allowed the appeal against the strike out. Simon Brown LJ (with whom Nourse LJ and Waite LJ agreed) held as follows:
“Rather than cite at length from these authorities, I propose instead to set out what I believe to be the central principles emerging from them:
1)               Motive and intention as such are irrelevant (save only where “malice” is a relevant plea): the fact that a party who asserts a legal right is activated by feelings of personal animosity, vindictiveness or general antagonism towards his opponent is nothing to the point. As was said by Glass JA in Champtaloup -v- Thomas 1976 2 NSWLR 264,271 (see Rajski -v- Baynton 1990 22 NSWLR at p 134):
 “To impose the further requirement that the donee [of a legal right] must be actuated by a legitimate purpose, thus forcing a judicial trek through the quagmire of mixed motives would be, in my opinion, a dangerous and needless innovation.”
2)               Accordingly the institution of proceedings with an ulterior motive is not of itself enough to constitute an abuse: an action is only that if the Court’s processes are being misused to achieve something not properly available to the Plaintiff in the course of properly conducted proceedings. The cases appear to suggest two distinct categories of such misuse of process:
  1. i)the achievement of a collateral advantage beyond the proper scope of the action – a classic instance was Grainger -v- Hill where the proceedings of which complaint was made had been designed quite improperly to secure for the claimants a ship’s register to which they had no legitimate claim whatever. The difficulty in deciding where precisely falls the boundary of such impermissible collateral advantage is addressed in Bridge LJ’s judgment in Goldsmith -v- Sperrings Limited [1977] 2 ALL ER 566,[1977] 1 WLR 478 at page 503 D/H of the latter report
  1. ii)the conduct of the proceedings themselves not so as to vindicate a right but rather in a manner designed to cause the Defendant problems of expense, harassment, commercial prejudice or the like beyond those ordinarily encountered in the course of properly conducted litigation.
3)               only in the most clear and obvious case will it be appropriate upon preliminary application to strike out proceedings as an abuse of process so as to prevent a Plaintiff from bringing an apparently proper cause of action to trial. In my judgment even if one were here to impute to the Plaintiff the motivation of her maintainer, this would not be so clear and obvious a case as to justify striking it out at this stage.”
  1. In Speed Seal Ltd v Paddington [1985] 1 W.L.R. 1327, the Court held that a counterclaim in which the defendant alleged that proceedings for breach of confidence had been brought for the purpose of damaging the defendant’s busines provided an arguable case of abuse of process for which permission to amend should be granted.
  1. In Land Securities plc and others v Fladgate Fielder [2010] Ch 467 the Court of  Appeal dismissed a strike out of a claim which asserted that the defendants’ dominant purpose in bringing judicial review proceedings in connection with the grant of planning permission to the claimant had been to put pressure on the claimant to assist in the relocation of their business.  Etherton LJ, with whom Moore-Bick LJ and Mummery LJ agreed, carried out a comprehensive review of the authorities, noting that Grainger v Hill itself and Gilding v Eyre were the only two recorded cases in which a claim of this nature had succeeded, both cases involving compulsion by arrest and imprisonment to achieve a collateral advantage. Etherton LJ concluded that there was no basis for extending the tort to judicial review or to a claim for pure economic loss beyond the heads of damage that must exist for the tort of malicious prosecution, that is to say, injury to the person, the costs of defending maliciously brought proceedings and damage to reputation.
“73.   … What, in my judgment, emerges clearly from the authorities is that the tort is not committed by a person who institutes proceedings with a genuine interest in, and an intention to secure, their successful outcome, even if the claimant’s motives are mixed and they hope that they may also achieve an objective not itself within the scope of the proceedings.”
  1. Moore-Bick LJ observed that, although rarely applied, the principle in Grainger v Hill has never been seriously doubted but that the tort of abuse of process now has a much reduced role following the abolition of arrest in support of civil proceedings and the introduction of a power to award costs when it is in the interests of justice to do so. Mummery LJ was hesitant about placing too much reliance on Grainger v Hill, without doubting the correctness of the decision on its facts, as a good guide to the shape of a tort for abuse of process by an application for judicial review.
  1. In JSC BTA Bank v Ablyazov and others (No 6) [2011] 1 WLR 2996 the defendants applied to stay the proceedings on the basis that they were being pursued by the bank for a collateral purpose, namely to damage the defendant’s reputation, diminish his wealth and assist his elimination as a political opponent of the president of Kazakhstan.  Teare J addressed the issue of whether a claimant who has two purposes for commencing proceedings, one legitimate and the other illegitimate, commits abuse of process by commencing the proceedings.  In Metall und Rohstoff AG v Donaldson Lufkin & Jenrette Inc [1990] 1 QB 391, 469 it had been suggested that if the predominant purpose was illegitimate the proceedings would be an abuse whereas in Goldsmith v Sperrings Ltd Bridge LJ had indicated that they would not be. Teare J preferred the approach of Bridge LJ: if one of two purposes is legitimate, the claimant should in principle be entitled to proceed with his claim, so avoiding the need to embark upon the difficult exercise of establishing which of two purposes is the claimant’s predominant one. Teare J therefore concluded on the facts that, even though it was arguable that the President of Kazakhstan had caused the directors of the claimant bank to bring the proceedings predominantly for the collateral purpose alleged by the defendants, the application for a stay could not succeed because the bank had a legitimate reason for bringing the proceedings, namely to recover the assets which it alleged the defendant had misappropriated.
  1. In Crawford Adjusters (Cayman) Ltd v Sagicor General Insurance (Cayman) Ltd [2013] UKPC 17 the defendant insurers had brought proceedings in fraud with the predominant intention of destroying the claimant professionally. The Privy Council agreed with the first instance judge that, since it was not alleged that the defendants intended to achieve his destruction other than through the initiation and successful prosecution of the action, the action had not been brought for a purpose other than that for which it was intended.
  1. Lord Wilson held as follows:
“63.  What is an improper purpose? A helpful metaphor suggested by Isaacs J in the High Court of Australia in Varawa v Howard Smith Co Ltd (1911) 13 CLR 35, 91, is that of a stalking-horse:
If the proceedings are merely a stalking-horse to coerce the defendant in some way entirely outside the ambit of the legal claim on which the court is asked to adjudicate they are regarded as an abuse of process for this purpose . . .”
The metaphor aids resolution of the conundrum raised by the example of a claimant who intends that the result of the action will be the economic downfall of the defendant who may be a business rival or just an enemy. If the claimant’s intention is that the result of victory in the action will be the defendant’s downfall, then his purpose is not improper: for it is nothing other than to achieve victory in the action, with all such consequences as may flow from it. If, on the other hand, his intention is to secure the defendant’s downfall or some other disadvantage to the defendant or advantage to himself by use of the proceedings otherwise than for the purpose for which they are designed, then his purpose is improper.”
  1. On the question of whether a subsidiary legitimate purpose negatived abuse even if the predominant purpose was illegitimate, Lord Wilson disagreed with Teare J on the ground that his conclusion failed to allow for the ease with which a claimant with a predominantly improper purpose can point to a legitimate purpose, however slight (para 65).
  1. Lord Wilson’s conclusion was as follows:
“79.  Sagicor did not commit the tort of abuse of process. Henderson J found that the predominant factor which led Sagicor to allege fraud and conspiracy against Mr Paterson had been Mr Delessio’s obsessive determination to destroy him professionally. But he did not proceed to find that Mr Delessio intended to achieve Mr Paterson’s professional destruction other than through the initiation and successful prosecution of the action. One can only speculate why, in that he was aware that Mr Purbrick’s reports were not a proper basis for the allegations, Mr Delessio anticipated that the action would succeed. But Mr Jacob failed in his attempt to persuade the Court of Appeal that the judge should have found that Mr Delessio, and thus Sagicor, had no intention of bringing the action to trial. In the absence of a finding of that character Mr Delessio’s purpose cannot be regarded as outside the scope of the action.” 226. In Willers v Joyce [2018] AC 779, the claimant brought proceedings seeking damages for malicious prosecution following the discontinuance of earlier proceedings brought by the defendant against the claimant for fraud. The judgments of the Supreme Court are mainly concerned with the scope of the tort of malicious prosecution, which it was held, extended to civil proceedings, but they also include observations on the Grainger v Hill tort. Lord Toulson (delivering the majority judgment) queried whether the tort existed as a separate cause of action at all (albeit without finally deciding the point):
“25.   Grainger v Hill has been treated as creating a separate tort from malicious prosecution, but it has been difficult to pin down the precise limits of an improper purpose as contrasted with the absence of reasonable and probable cause within the meaning of the tort of malicious prosecution. This is not entirely surprising because in Grainger v Hill itself there plainly was no reasonable or probable cause to issue the assumpsit proceedings, since the debt was not due to be paid for another ten months as the lenders well knew. It might be better to see it for what it really was, an instance of malicious prosecution, in which the pursuit of an unjustifiable collateral objective was evidence of malice, rather than as a separate tort. … It is unnecessary to express a firm view on this point, but Grainger v Hill does at any rate illustrate the willingness of the court to grant a remedy, in what it regarded as novel circumstances, where the plaintiff had suffered provable loss as a result of civil proceedings brought against him maliciously and without any proper justification.”
  1. Since Willers v Joyce, the continued existence of the tort of abuse of process (as distinct from that of malicious prosecution of civil proceedings) has been recognised by Nugee J in Holyoake v Candy [2017] EWHC 3397, para 413.
  1. The following propositions can be extracted from these authorities.
(1)         The tort is recognised as part of English law although a claim based on the tort has only succeeded in two reported cases: Grainger v Hill in 1838 and Gilding v Eyre in 1868. In a number of recent cases, its usefulness has been doubted in view of the Court’s powers to control abuse of process and the overlap of the tort with the tort of malicious prosecution but they do not firmly decide that the tort no longer exists.
(2)         The tort of abuse of process is committed when legal proceedings are brought for an ulterior purpose which is not within the proper scope of the legal process, e.g. for the purpose of extorting the defendant’s property.
(3)         The tort can be committed irrespective of whether the legal proceedings in question were determined in the defendant’s favour.
(4)         The bringing of legal proceedings for the purpose of achieving the natural consequences of the litigation, such as a defendant’s financial ruin, is not an improper purpose.
(5)         Motive and intention, e.g. the personal antagonism of a claimant towards a
defendant, are in themselves irrelevant.
  1. There are conflicting authorities on the question of whether the tort can be committed where the claimant has mixed purposes. It was submitted on behalf of Mr King that I should follow the approach of the Privy Council in Crawford v Sagicor and hold that the tort is committed if the predominant purpose is improper rather than the contrary approach of Teare J according to which a proper purpose negatives an improper one. Given my findings on the facts, both approaches lead to the same result and it is not necessary for me to choose between them.
Issue (2): Does the evidence establish that the proceedings were brought for an improper purpose?
  1. KSSL does not suggest that the purposes of the proceedings alleged by Mr King (namely the enabling of a purchase by Primekings at an undervalue of the King family shares and/or the causing of gratuitous damage to Mr King by permanently damaging his reputation and employment prospects) are other than improper purposes. The issue to be determined is therefore whether the evidence establishes that the proceedings were either or both of these purposes.
Matters relied on by Mr King in support of the first alleged purpose
  1. Mr King relied on the following allegations in support of his case that the purpose of KSSL in issuing this claim was to pressurise the King family into giving up their shares at an undervalue:
(1)         Primekings always intended to obtain the King Family Shares, as was made clear by the terms of the settlement offer made on 13 June 2017 (paragraph 119 above) and board minutes on 27 March 2018 which record Mr Zeidler as reporting on the Part 8 proceedings and noting that
It is expected that PKH will hold 100% of the shares by the end of April. Once resolved it would be possible to restructure the capital base of the company for an extra capital injection, the Cougar & Securenett proposition all become possible. Presently PKH are being asked to take 100% of risk for 60% of the business.”   
(2)         Since the consistent goal was to get the shares, it is a reasonable inference that this was the specific goal of those controlling KSSL when sanctioning the spending of money on preparing and issuing a claim on 15 August 2017. The only possible upside in that regard was the obtaining of the King Family Shares. Mr King was known to be ‘cash’ impecunious at the time. KSSL knew that there was an offer of cash available from TCH at the date of issue in excess of the realistic value of the claim. Mr Pownall had also pointed out that KSSL could
“self-help” by deducting money from the £70,000 payable pursuant to the Settlement Agreement. All these options were turned down.
(3)         The sum now being sought was admitted by Mr Zeidler to be comparative ‘chicken feed’ to KSSL and was much less than KSSL’s irrecoverable costs from very early in the case.
(4)         KSSL has employed numerous pressure tactics including internal investigation aimed at finding dirt on Mr King, immediately following an assurance on 17 May: “we’ll find something”  threats to Mr Pownall, defaulting on the Settlement Agreement, sending an 8 page letter of claim, obtaining a charging orders over the shares and then seeking to obtain them at an undervalue in the Part 8 proceedings, exerting costs pressure, most obviously with a statement in KSSL’s accounts that the costs were £1,227,000 up to 30 July 2019 and then with an attempt to raise the budget at the PTR by £630,000.
(5)         The lack of notice of these proceedings given to Mr King, someone the directors were in regular contact with at the time, was only consistent with an intended ‘shock’ effect, which would only be desirable in case issued to create pressure.
(6)         Mr Stiefel’s phrase ‘reap the whirlwind’ (paragraph 132 above) is not a phrase that would be used to describe proper process; it would be used by someone to describe something anticipated to be improper and oppressive.
(7)         The proper purpose of the proceedings contended for by KSSL (namely the objective of establishing the truth) is not borne out by the conduct of KSSL in relation to these proceedings. Mr Zeidler described the fact that Mr King had obtained funding enabling him to be properly represented was the ‘most unfortunate’ aspect to how the claim developed. Witness statements have been drafted by KSSL’s legal team without regard for the truth, witnesses have been pressurised into not giving evidence in support of Mr King or to give false evidence. The truth could have been best established by talking to Mr King, but KSSL did not want the truth. Mr Zeidler on 1 November 2018 told Mr Volpe that: “Our preferred outcome of the search is to show that AK did receive the forwarded e-mails”.
(8)           There is a considerable body of circumstantial evidence KSSL is willing to misuse Court proceedings as a tool to achieve its commercial goals. These include:
(a)         Trying to dissuade VSG from hiring Mr King (a commercial decision) KSSL by threatening legal process to achieve entirely collateral commercial objectives;
(b)         During the trial KSSL’s counsel asking Mr King if he wished to ‘change’ the evidence he gave to Marcus Smith J which can only have been to gain a collateral advantage for use in other proceedings;
(c)         Claiming privilege in respect of the TCH offer in an attempt to ensure that the Court did not know about it;
(d)         Intimating to Master Cousins that he might be reported to the Judicial Conduct Investigation Office if he did not issue his judgment;
(e)         Writing to AIG, who were funding Mr King’s legal costs, warning them that they might be held liable for the costs of the proceedings with the aim of making AIG believe that it was not in its commercial interests to continue to fund the Defence of Mr King;
(f)          Through Counsel, pressurising witnesses into changing their answers, for example Mr King being repeatedly asked ‘yes or no’ if he had influence, and Mr Pownall being asked six times whether there could be other reasons why KSSL did not accept the TCH offer;
(g)         Through Counsel, intervening to stop particularly damaging answers emerging, in particular during the cross-examination of Mr Pownall.
  1. In my judgment these allegations fall far short of establishing that these proceedings have been brought for the purpose of enabling Primekings, through pressure on Mr King, to obtain the King Family Shares at an undervalue. This is for the following reasons.
  1. First, the fact that in 2017 Primekings and its representatives were interested in acquiring the King Family Shares does not support the inference that the purpose of these proceedings was to enable that objective to be achieved, still less to be achieved by obtaining the shares at an undervalue. Following the collapse of the Misrepresentation Proceedings, Primekings and its representatives had the benefit of a costs order in their favour in the sum of £1.7 million with detailed assessment to follow, which they were entitled to enforce. They quite understandably proposed to satisfy that liability by obtaining a transfer of the Kings’ only substantial asset apart from their homes, namely the King Family Shares. Having sought unsuccessfully to reach a settlement agreement on terms that the shares were transferred, they obtained a final charging order over the King Family Shares on 3 August 2017. By the time these proceedings were started on 15 August 2017, they were therefore in a position to bring Part 8 proceedings to obtain an order for sale of the shares. The current proceedings were not needed in order to enable Primekings to obtain the King Family Shares and did not further that objective in any way.
  1. Second, whilst there is no doubt that costs spent by KSSL on these proceedings, which I understand are in the region of £2.5 million plus VAT, are grossly disproportionate to the relatively small amount at stake, this does not support the contention that the proceedings were brought for the purpose of obtaining the King Family Shares.  The evidence of KSSL’s witnesses, which I accept, was that when the claim was launched it was anticipated that the claim would be relatively straightforward and swift to resolve. Once the costs had increased substantially, KSSL was not prepared to discontinue and expose itself to an adverse costs order. The costs of proceedings have been significantly increased by Mr King’s counterclaim. The willingness of KSSL to spend such large sums on the proceedings and the failure to accept TCH’s offer of compensation indicates that these proceedings were not brought for the predominant purpose of obtaining compensation but not that they were brought for the improper purposes alleged by Mr King.
  1. Third, the criticisms made of KSSL’s conduct of these proceedings do not provide any real support for Mr King’s case that KSSL’s predominant purpose in bringing the proceedings was the improper one alleged. 
  1. As already noted, I accept Mr King’s contention that KSSL ought to have sent a pre-action protocol letter. There was no good explanation for its failure to do so.  I do not, however, believe that KSSL was thereby attempting to put additional pressure on Mr King. I accept that a pre-action protocol letter was not sent for the reasons put forward by Mr Zeidler (paragraph 134 above).
  1. KSSL accepts that it should not have resisted disclosure of the Master Lease document after it was requested, without the need for Mr King to make a specific application for disclosure. There has been no satisfactory explanation for its delay in providing disclosure. That said, I consider that Mr King overstates the importance of the Master Agreement. The Master Agreement does not provide powerful support for Mr King’s case that he had a personal lease. It is not in the form of a personal lease. It sets out terms between TCH and a commercial leaser of multiple vehicles and does not mention the Range Rover or the hire charges. The document is consistent with an intention to conceal the true arrangements with sham paperwork. The fact that the document was eventually disclosed is at odds with the suggestion that KSSL was intent on concealing it and misleading the court.
  1. The letter to AIG threatening a third-party costs order, though misguided, was not improper. I do not accept that KSSL’s intention was to frighten AIG into stopping funding Mr King’s defence rather than to indicate that KSSL would seek to hold AIG responsible for its costs.
  1. The letter to the Court seeking an assurance as to when Deputy Master Cousins’ judgment would be ready, with a threat to report to the Judicial Conduct Investigation Office, was also inappropriate but it was not, in my view, improper and it does not support the inference which Mr King seeks to draw as to the purpose of the proceedings.
  1. The assertion that KSSL’s witness evidence was deliberately drafted in order to mislead the court is a serious allegation for which there is, in my judgment, no valid foundation. Mr Newman’s closing submissions refer to various discrepancies between the witness statements and the oral evidence. Such discrepancies are commonplace and come nowhere close to showing an intention to deceive on the part of the witnesses or KSSL’s solicitors.  Similarly, the assertion that witnesses had been pressured not to give evidence or to give false evidence was unsubstantiated. There was no basis for the serious assertion that Mr Pownall had been “put under pressure to give false evidence” other than the fact that his evidence was critical of Mr King whereas, as a colleague, he had been supportive. Mr Evans denied Mr King’s claim that he had been asked to lie by KSSL’s solicitors.  The criticisms of the way in which cross-examination had been conducted by Mr Downes were similarly unfounded.
Second alleged purpose: to damage Mr King’s reputation 
  1. Mr King relies on the following allegations in support of his case that the predominant purpose of KSSL in issuing this claim was to ruin his reputation and employment prospects:
(1)         KSSL intended that Mr King would not be in a position to defend the claim (it is common ground he was known to be impecunious) and intended to use a bribery declaration obtained by default to ruin Mr King’s ability to work in the market.
(2)         Even if he did not ‘fold’ immediately, third parties could be told ‘honestly’ about the claim, in the knowledge that such third parties would assume that such a serious claim (seeking a declaration that a bribe had been taken) would only have been brought in a responsible fashion following the most anxious of scrutiny of the evidence (something that, according to Mr King, KSSL knew had not happened).
(3)         The intention to damage his ability to work is clear from a number of pieces of evidence, including:
(a)  communications with VSG, a potential employer in relation to which Mr Zeidler noting that “the Bribery charge would colour their perception if it was considered serious”:
(b)  Board minutes on 27 February 2018 recording Mr Stiefel as stating (with reference to the industry body Association of Security Consultants (“ASC”)  – “a reference should be given with it being honest and alerting those receiving it of the litigation.” 
(c)  a letter to Mr King from KSSL’s solicitors dated 8 March 2018 threatening to injunct Mr King for breaching the restrictive covenants in the Shareholder and Subscription Agreement entered into with Primekings and KSGL dated 20 December 2013.
  1. Again, these allegations fall far short of establishing that these proceedings were brought for the purpose of ruining Mr King’s employment prospects.
  1. It is clear that KSSL intended to hold Mr King to the restrictive covenants in his Shareholder and Subscription Agreement as it was entitled to do. It does not follow that the purpose of these proceedings was to interfere with his employment prospects.
  1. If KSSL’s predominant purpose in bringing these proceedings had been to ruin Mr King’s reputation and employment prospects, I would have expected it to seek to generate media interest in the proceedings. It is not suggested that it has done so. In fact, it appears to have gone out of its way not to publicise the proceedings in order not to damage its own reputation. According to a board minute dated 30 November 2018, it was agreed that, should anyone ask about the claim, they should be referred to Mr Zeidler and any comments kept neutral and minimal. It is Mr King who has sought to generate media interest in the proceedings. In December 2019 he contacted a documentary maker at ITV to make a programme about the dispute with KSSL who attended one of the hearings and is, according to Mr King, now waiting to see how the proceedings end.
  1. There is no evidence that KSSL used the legal proceedings to interfere with Mr King’s employment prospects with VSG. The note of the meeting between Mr Zeidler and VSG shows that he drew VSG’s attention to Mr King’s restrictive covenants.
  1. I do not consider that the board’s decision to give him an “honest” reference alerting ASC to the litigation remotely supports the inference that the proceedings were brought in bad faith knowing that there was no valid claim against him in order to ruin him.  The letter from KSSL’s Solicitors sought quite legitimately to hold Mr King to his restrictive covenants.
  1. Mr King’s case as to the supposedly improper purposes imputed to KSSL in bringing these proceedings is further undermined by the open offer to settle the proceedings contained in letters dated 9 June and 23 June 2020 from KSSL’s solicitors. The offer was along the same lines as the offer made to and accepted by Mr Evans, namely a payment in respect of KSSL’s damages claim, a contribution to KSSL’s costs and an open acceptance, with hindsight if necessary, that the transaction should have been the subject of disclosure/board approval i.e. not involving Mr King in having to acknowledge any conscious impropriety. This offer was not accepted by Mr King. In the absence of a settlement, the proceedings have been brought to a conclusion, which in itself counts heavily against a finding of an abuse as observed by Lord Wilson in Crawford v Sagicor (paragraph 220 above)
KSSL’s actual purposes 
  1. KSSL contends that its actual purposes in bringing these proceedings were to obtain compensation, to vindicate KSSL’s rights as against Mr King and Mr Evans and to protect KSSL’s reputation in the security industry by publicly demonstrating that KSSL would not tolerate conduct of the kind perpetrated by them.
  1. I accept that those purposes played some part in KSSL’s decision to bring the proceedings although, as noted above, it must have been obvious to KSSL from early on that the irrecoverable costs of the litigation would dwarf any compensation it was awarded and that if recovery of compensation was KSSL’s main objective, it would have accepted the compensation offered by TCH and discontinued the proceedings.
  1. It is clear to me that, aside from these purposes, the anger felt by Mr Stiefel and Mr Fisher towards Mr King, as a result of what they considered to be the unfounded allegations made against them in the Misrepresentation Proceedings, compounded by anger at what they considered to be his dishonesty and failure to accept responsibility for his actions, must have influenced KSSL’s decision to bring these proceedings and also had an effect on the combative, sometimes over-combative, manner in which the proceedings have been conducted. As the authorities cited above make clear, however, motive and personal antagonism are in themselves irrelevant to the question whether proceedings have been brought for an improper purpose. 
Issue (3): Has Mr King proved any recoverable losses?
  1. Given my conclusion that Mr King has failed to establish that these proceedings were brought for an improper purpose, issues of recoverable losses fall away. Had it been necessary to determine those issues, I would have given directions for a separate assessment of damages as Mr King’s damages claim has not yet been particularised in detail and the damages claim has not been the subject of disclosure.
  1. Mr King is liable to pay KSSL the sum of £45,666.47. Mr King’s counterclaim is dismissed.