Best and Another v Ghose and Others

• Jurisdiction: Ireland
• Judge: Ms. Justice Pilkington
• Judgment Date: 13 March 2024
• Neutral Citation: [2024] IECA 58
• Court: Court of Appeal (Ireland)
• Docket Number: Court of Appeal Record No. 2022/226

Between/

Margaret Best and Carmel Best (As Joint Committee of the Person and The Estate of Kenneth Best, A Ward)

Plaintiffs/Respondents

and

Pramit Ghose, Niall Joseph Tinney, Patrick Thomas Finnegan, Peter Alphonsus Costigan, Patrick Dempsey, Raymond Deasy, Tadhg Francis Gunnell, Angus McDonnell, David Harlowe, Martin Harte, Aidan Sheerin, Arthur Quinlan, John Martin Maguire, Anne Barrett, Legacy Investment Holdings Limited, Together Formerly Trading as Bloxham Stockbrokers Partnership, Bloxham Stockbrokers Partnership (In Liquidation) and Northern Trust (Ireland) Limited

Defendants

and

Pramit Ghose

First Defendant/Appellant

[2024] IECA 58

Whelan J.

Haughton J.

Pilkington J.

Court of Appeal Record No. 2022/226

High Court Record No. 2016/2326S

THE COURT OF APPEAL

CIVIL

Unapproved

No Redactions Needed

JUDGMENT of Ms. Justice Pilkington delivered on the 13th day of March 2024

Introduction

1 . This is an appeal by Mr Ghose (“Mr Ghose” or “the appellant”) in respect of a portion of a costs judgment (styled a Costs Ruling) of Baker J. delivered on 5 August 2022 (‘the costs ruling’) 1 and its Order of the same date (perfected 9 August 2022).

2 . The costs ruling arises on foot of two previous judgments; the first on 27 June 2018 2 (‘the 2018 principal judgment’), with its Order dated 16 October 2018 and a supplemental judgment, delivered on 9 June 2020 3 (‘the 2020 judgment’).

3 . The fact that this is an appeal against a portion of a costs ruling belies the complexities that arise and the issues that underlie its adjudication.

Background

4 . Mr Best was made a ward of court by Order of the President of the High Court on 14 June 1993, following proceedings instituted on his behalf against the manufacturer of a vaccine he had received as a baby, and a significant sum was paid into court in settlement of these proceedings (‘the Fund’). His mother and subsequently his sister were appointed his committee on 14 June 1993 and 9 December 2005 respectively. I will refer to the respondents collectively as ‘the Committee’ or ‘the respondents’.

5 . In or around July 2002 the Fund was transferred to Bank of Ireland Security Services and its assets were managed by Bloxham Stockbrokers Partnership (‘Bloxham’). The transfer was authorised by the President of the High Court on 25 July 2001. The 2018 principal judgment records (at para. 33) that Bloxham managed the Fund until May 2012, when it was directed to cease trading by the Central Bank. Bloxham was subsequently wound up by order of the High Court 4, and Mr Wallace appointed its liquidator. Thereafter the Bloxham accounts were moved to J&E Davy Stockbrokers (‘Davys’).

6 . This litigation commenced by way of a summary summons issued on 1 December 2016. 5 The matter then came before Baker J. on foot of a Notice of Motion issued on 1 March 2017 in which the relevant relief sought 6 was:

“(a) an order that the first to tenth and twelfth to sixteenth defendants account to the plaintiffs for their dealing with the Fund and provide the plaintiffs with all supporting documentation for the account.”

7 . The consideration of this issue forms the basis of the 2018 principal judgment. Without anticipating matters yet to be discussed, it is common case that the core of this appeal begins after delivery of the 2018 principal judgment. Its primary focus relates to the Court's award of costs in respect of litigation that took place after its delivery, which comprise six hearings (‘directions hearings’), which took place on 25 July 2018, 16 October 2018, 13 December 2018, 7 February 2019, 4 April 2019 and 10 May 2019 7. These in turn culminated in the 2020 judgment.

8 . Whilst the costs ruling itself deals with the costs of all the proceedings within this application, it is that specific clause which deals with the costs to be awarded after the delivery of the 2018 judgment and up to the delivery of the 2020 judgment that is at issue in this appeal.

9 . It therefore follows that this is not an appeal in respect of the 2018 principal judgment, the various directions hearings or the 2020 judgment, but an analysis of them is necessary so as to properly understand the costs ruling. In short it is necessary, in order to understand the costs ruling, to consider the judgments and applications that underpin it.

The 2018 Principal Judgment

10 . The 2018 principal judgment sets out the background to the litigation. As set out above, this judgment solely considers the single relief sought by the Committee, being an order for the taking of an account in respect of the Fund.

11 . The judgment records that, in respect of this application;

• (a) Mrs Best swore a grounding and supplemental affidavit, an affidavit in support of her application was sworn by David Croft, a financial expert retained by the Committee.

• (b) Mr Ghose, the first named defendant swore two affidavits and he was cross examined 8.

• (c) In respect of the remaining defendants, Baker J. confirmed that the first to fourteenth formed the Bloxham Stockbrokers Partnership and the judgment further records at para. 11 that affidavits were sworn on behalf of the third, eight, ninth, tenth, twelfth, thirteenth and fourteenth defendants.

• (d) Paras. 6 and 7 record that no orders were sought against the eleventh named defendant, Aidan Sheridan, or against the seventeenth and final defendant, Northern Trust (Ireland) Ltd.

12 . Because the Committee sought the taking of an account as an actionable right in itself as opposed to an ancillary relief to a substantive action, the Court held that the plaintiffs must initially establish such an entitlement (para. 39).

13 . Based upon a comprehensive analysis of the relevant case law and on the facts of this case, Baker J, found such an entitlement arose where the defendant owes a fiduciary relationship to the plaintiffs and is obliged to account by virtue of that relationship 9

14 . In considering the nature of the fiduciary relationship between Bloxham and the Committee 10, the court concluded at para. 69:

“I am of the view that Bloxham undertook the management of the Fund in circumstances which imported a duty to act with loyalty, and whilst Bloxham was entitled to be paid commission and other management charges on the agreed basis, it could not act in its own commercial interests. The management contract contained sufficient elements of a fiduciary nature to import a duty to account.”

15 . After considering an argument by counsel for Mr Ghose as to whether the fact of managing an account gives rise to a fiduciary relationship between the manager 11 of the Fund and the beneficiary, Baker J. stated at para. 74:

“It seems to me, therefore, not to be necessary to determine whether Bloxham is to be described as a fiduciary in the absolute sense or whether, for the purposes of the present application, the arrangement entered into with Bloxham imported an obligation of confidence and trust importing in turn an obligation to explain or account the exercise of the discretionary power. I am satisfied on the evidence that Bloxham did have an obligation to explain and account for the exercise of its discretionary investment and management powers, and that the contractual relationship does import a sufficient degree of confidence or trust to constitute the management obligation as being fiduciary in nature.”

16 . Baker J. confirmed at para. 80 “the obligation on Bloxham derives from the nature of the contract by which Bloxham was engaged to administer the fund with the interests of Mr. Best in mind”.

17 . Following her conclusion that Bloxham “are obliged to give an account of the dealings with the capital and income of the Fund, and that the details would, if necessary, be supported by relevant documentation and be sufficiently intelligible and clear to provide an explanation as to the movement on the account” (para. 96), the Court went on to consider the nature of the accounting information which had already been furnished.

18 . It was apparent to the Court that the Registrar of the Wards of Court office and possibly the Accountant of the Courts of Justice held additional documentation which the Court directed should now be furnished to the Committee. At para. 30 of her judgment Baker J. noted Mr Ghose's oral evidence that reports “may have been sent” to the Office of the Wards of Court but he did not know if they were sent on a regular or consistent manner. The Committee contended that no such reports were received. Mr Ghose also gave evidence that he did not know what happened to the Bloxham computerised data after its liquidation. It transpired that the liquidator Mr Wallace held 504 boxes of documentation from Bloxham.

19 . At para. 128 the court held:

“ I consider in summary that the following is the position:

• (a) there exists an obligation on the defendants, subject only to what I say below regarding the role to be played by some of the defendants, to furnish a full record of transactions in the form of an account or narrative;

• (b) the documents available at the hearing of the application before me are prima facie not complete;

• (c) the plaintiffs, with their advisors, are to be permitted to inspect the 504 boxes of documents held by Mr. Wallace;

• (d) the President of the High Court is to be asked for further directions regarding the documents held by the Registry of the Office of the Wards of Court and/or the Accountant of the Courts of Justice or other relevant office;

• (e) Mr. Croft 12 is to further analyse and inspect the documents now available and can then offer further assistance with regard to the adequacy of the records for his purpose.”

20 . Baker J. then considered whether the liquidator had a duty to account. She was satisfied, in essence, that he did not and at para. 116 states that there is “ no basis on which I can import any obligation on Mr....