PI Brief Update

Dishonesty or litigation 'wishful thinking' - Anisa Kassamali, Temple Garden Chambers

30/07/23. Judges are often asked to consider the honesty of a witness when giving evidence. Mr Justice Richards considered the question in the context of an action by a corporate investment fund in Old Park Capital Maestro Fund Ltd v Old Park Capital Ltd & Ors [2023] EWHC 1886 (Ch).

Background

A corporate investment fund (the “Fund”) brought proceedings against three defendants: (i) the investment manager of the Fund (“Old Park Capital); (ii) the Chief Operating Officer of Old Park Capital (“HVK”); and (iii) a director of the Fund (“BP”). This update considers Mr Justice Richards’ discussion of HVK’s evidence.

Decision

Mr Justice Richards held that various of HVK’s assertions in his witness statement were not true. However, he still concluded that this was a case of ‘litigation wishful thinking’ rather than dishonesty. He relevantly observed:

“11. During HVK’s cross-examination, it became clear that various assertions in his witness statement were not true. The Fund helpful set these matters out in a Table of Admissions…I will not deal with each instance alleged. The headline point is that HVK was wrong to deny, in his witness statement, the existence of an arrangement or understanding, made prior to the launch of the Fund, for the Fund to invest in [commercial paper]. He was also wrong to deny his knowledge of that arrangement or understanding, made prior to contemporaneous emails put to him in cross-examination. The Fund has invited me to conclude that HVK was an untruthful and unreliable witness. I have considered the matter carefully but, having regard to the totality of his evidence, I will not make that finding.

12. It was clearly not to HVK’s credit that he made untrue statements in his witness statement. Moreover, he did initially defend those statements in cross-examination. However, once he was shown emails that showed the inaccuracy of his witness statement, he accepted the inaccuracies. That necessarily meant that there was some inconsistency in his evidence, but I consider that the Fund overstates matters which it says that most of the nine indicators of unsatisfactory witness evidence that Lewison J identified in Painter v Hutchinson [2007] EWHC 758 (Ch) were present. HVK has given full disclosure of a large number of documents. While his answers to some questions in cross-examination were long, I did not consider him to be evasive or argumentative. When his answers were long, that was often because of the difficulty that he had in being invited to draw conclusions from a small cross-section of the emails that he had received t the time. If anything, he was on occasions too ready to accept propositions that were put to him.

13. Ultimately, I have concluded that the untrue statements in HVK’s witness statement were a result of what Mann J described as ‘litigation wishful thinking’ in Tamlura NV v CMS Cameron McKenna [2009] EWHC 538 (Ch)…Some allowance is appropriate for the sheer quantity of emails that HVK received. Nearly 400,000 documents were extracted from HVK’s data sources, reduced to 20,000 for the purposes of disclosure. The pre-existing arrangement for the Fund to invest in [commercial paper] featured in just a few of the emails that HVK received. He could well have overlooked those emails, or their significance, when preparing his witness statement.”

The scope of the case, particularly the extent of the disclosure, was relevant to Mr Justice Richards’ decision. Nonetheless, practitioners should take note that there is some a middle ground between ‘honest’ and ‘dishonest’ witnesses.

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