Durnont Enterprises v Fazita Investment Limited & Ors

Neutral Citation Number: [2026] EWHC 1224 (Ch) Case No: CR-2022-001347 IN THE HIGH COURT OF JUSTICE BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES INSOLVENCY AND COMPANIES LIST (ChD) DERIVATIVE CLAIM IN THE MATTER OF POLISH REAL ESTATE INVESTMENT LIMITED Royal Courts of Justice, Rolls Building Fetter Lane, London, EC4A 1NL Date: 18 May 2026 Before: Mr Justice Rajah – – – – – – – – – – – – – – – – – – – – – Between: Durnont Enterprises Claimant – and – (1) Fazita Investment Limited and others (2) Władysław Jaroszewicz (3) Michael Carl Jaroszewicz (4) M-Jwk-Management Spółka Z Ograniczona Odpowiedzialnościa (Formerly M-Jwk-Management Spółka Z Ograniczona Odpowiedzialnościa Sp.J And M-Jwk Sp. Z. O.O. Ska) (5) Anna Bandurska (6) Jan Czeremcha (7) Maciej De Makay 8) Bnp Paribas Bank Polska S.A. (Formerly Bgz Bnp Paribas S.A., Formerly Raiffeisen Bank Polska S.A.) (9) Polish Real Estate Investment Limited Defendants – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – Andrew Dinsmore, James Lamming and Mr Riches (instructed by Cooke Young & Keidan) for the Claimant Emilie Gonin (instructed by Gardner Leader) for the First Defendant George McPherson and Eric Shi (instructed by PCB Byrne) for the Second and Third Defendants James Purchas and Harry Samuels (instructed by Gresham Legal) for the Fourth and Fifth Defendants Hearing dates: 18th May 2026 – – – – – – – – – – – – – – – – – – – – – APPROVED JUDGMENT Monday, 18 May 2026 MR JUSTICE RAJAH

1. The claimant, (“Durnont” or “C”), has brought proceedings on its own behalf and by way of derivative action on behalf of the ninth defendant (“PREI”). Durnont was given permission to bring these proceedings on behalf of PREI and to serve them out of the jurisdiction by an order Tom Smith KC, sitting as a Deputy High Court Judge, on 8 June 2023.

2. The proceedings allege that the first to fifth defendants have conspired to fraudulently misappropriate PREI's interest in a Polish fund invested in Polish real estate. The first to fifth defendants issued a number of applications to strike out or have reverse summary judgment in respect of the claim to challenge jurisdiction and to set aside the grant of permission to bring a derivative claim.

3. On 25 February of 2026 I handed down a judgment on those applications and dismissed them all. This is the consequentials hearing.

4. The parties have agreed some matters. So it is agreed (i) that the defendants are in principle liable for the claimant's costs in defending the challenges (ii) that detailed assessment is required to assess those costs (iii) that the defendants are liable to make an interim payment to the claimant (iv) that the second and third defendants are to pay the claimant £30,000 in settlement of its costs liability following the second and third defendants' application for relief from sanctions (v) that £150,000 of the circa £1.78 million in security for the defendants' costs of the challenges which were paid into court by the claimant is to be released forthwith.

5. The key issues for me at this hearing are, therefore: (i) whether there is to be permission to appeal (ii) whether the detailed assessor is to assess costs on an indemnity or standard basis (iii) the level of interim payment and its payment terms, including whether liability is to be joint and several, and whether there should be a stay pending appeal (iv) whether there is to be a release pending appeal of the balance of the roughly £1.6 million by way of security for costs which are sitting in court.

6. I am going to refuse permission to appeal but I will set out brief reasons at the end. It is clear that the application for permission to appeal will be renewed to the Court of Appeal and it is possible that it might be granted there. The possibility of a successful appeal is relevant to the decisions which I must make, but does not turn on whether I grant permission. Joint and several liability

7. I am going to deal now with the question of joint and several liability. The defendants accept that they must pay the claimant's costs of the jurisdiction challenge, but have sought an apportionment of costs between them and on the basis that are only severally liable for their apportioned share.

8. In this case, the defendants, although separately represented in three sets comprising D1, as one set, D2 and 3 as another and D4 and D5 as the third set, have adopted a united front and have a common interest in disputing the court's jurisdiction.

9. As explained in the judgment, D1 is owned by a trust set up by D2 for the benefit of himself and his family, which includes D3. D4 is beneficially owned by D2 and/or D3 and is ultimately controlled by another vehicle, JWK, which is also majority owned by them. D5 is the sole director of JWK and the pleaded case is that D2 and D3are able to control the D1, D4 and D5 and that they are all parties to a fraudulent scheme.

10. In the jurisdiction applications, although they have divided the points taken between them, they each had an interest in the success of each of the applications made by the other sets of defendants succeeding and they each adopted the submissions of the other party or the other defendants.

11. The claimant has prepared three detailed schedules which were sent to the defendants on 11 May. The defendants say that they have not had much time to consider those schedules, although I observe they have very fully resourced legal teams, comprising three firms of solicitors and five counsel. They have made a number of points which suggest that the schedules are prepared in a way which may exaggerate the points being made by the claimant. I take those points into account, but I do consider the schedules to be useful illustrations of some points.

12. I have also received a Note from D4 and D5 on the number of factual witness statements, which is also helpful..

13. If one takes the claimant's third schedule it shows 81 instances where the evidence of one set of defendants has cross referred to and adopted the evidence of another set of defendants. Whether it is 81 instances or some smaller number, it is still an illustration of the commonality of interest between the defendants on the issues and their united approach in the conduct of this litigation.

14. Where several parties combine to advance the same unsuccessful case, the usual rule is that they are jointly and severally liable for the costs payable to the successful party: see Ontulmus v Collett [2014] EWHC 4117 (QB) at paragraph

64.

15. Although each of the defendants advanced their jurisdiction challenge on slightly different grounds, there was considerable overlap between them; for example on article 415, full and frank disclosure and forum. To the extent that different points were taken, for example by D1 in relation to the SSA, they were, in reality, an apportionment of points to be taken between the defendants. They had a common cause; and, as I have observed, each was interested in the success of every other defendant's application, adopted their submissions and supported them. I consider that, in substance, this is one unsuccessful challenge to jurisdiction.

16. I was referred to a case summary of an unreported decision of Newey J in GHLM Trading Limited v Maroo on 27 February 2012. The case summary says that the judge in that case awarded costs against three defendants on a joint and several basis because “…they had interests which were intimately related and on which they made common cause” and “, they could not sensibly be differentiated as their approach had been to act together and indivisibly”. My reading of that case summary, which is merely a case summary, is that it is not setting out a test for the circumstances in which it is appropriate to order defendants to pay costs on a joint and several basis, but I am also satisfied that in this case the defendants' interests were interrelated, they have made common cause; and they were acting together. Indemnity or standard costs

17. There was little disagreement between the parties as to the principles to be applied by the court in making a choice as to the basis of assessment. The relevant principles were summarised by Mrs Justice Gloster (as she then was) in Euroption Strategic Fund v Skandinaviska Enskilda Banken AB [2012] EWHC 749 (Comm) at paragraphs 8 to

15.

18. In even greater summary, the relevant provisions of the CPR are contained in rules 44.3, 44.4 and 44.5. There are two differences between the two bases of assessment. The first difference is that on the standard basis the burden of proof is on the receiving party to establish that that party's costs were reasonably incurred and reasonable in amount; on the indemnity basis the burden of proof is on the paying party. The second difference is that on the standard basis, only costs which are proportionate are recoverable; that limitation is not there when costs are assessed on the indemnity basis.

19. The standard basis is the normal basis of assessment. There needs to be something to take the case “outside the norm” to justify indemnity costs. Dishonesty or moral blame are not necessary. Unreasonableness in the conduct of proceedings may suffice. However, “unreasonable” in this context means unreasonable to a high degree and not just conduct which is wrong or misguided. Whether conduct has been unreasonable to a high degree depends on the facts of the particular case.

20. In this case, the defendants have approached this case by taking every point which can be taken , causing enormous costs to be incurred (I refer to this “everything but the kitchen sink” approach as “the kitchen sink” approach). They have lost on every point in the hearing.

21. Mr Dinsmore for C submits, and I accept, that it is the defendants who are responsible for the fact that there are 13 to 19 witness statements of fact (depending on whether one includes corrective statements) in this case. I have looked at those witness statements over the weekend and I have had the benefit of the note from Mr Purchas and Mr Samuels for D4/5. While there is a measure of scene setting, and a measure of rejection of the assertion of fraud, which is appropriate, they are in fact very extensive, very detailed and they follow the take every point approach which the defendants have adopted.

22. That is contrary to the guidance in Okpabi that the defendants should not challenge the facts which are stated in the particulars of claim or indeed in the factual witness statements which are relied on by the claimant in support of the application for service out of the jurisdiction or, in this case, for second stage approval of the derivative claim.

23. They have, in fact, filed factual evidence challenging many aspects of the factual evidence leading to a cycle of responsive and reply evidence. In the end, the hearing proceeded on the basis that the facts stated in the particulars of claim were true, and no reference or almost no reference was made to any of the factual statements which had been filed.

24. The claimant's first schedule is a table of the 44 key points raised by the defendants' evidence. Mr Purchas says that the schedule splits points unfairly to exaggerate the number of issues raised by the defendants. That may be so, but I consider that it also evidences the kitchen sink approach being taken by the defendants, which has greatly increased costs. Many of those points were quietly dropped before or during the hearing. For example, a point was taken that D2 had not been formally appointed by D, pursued in D1’s skeleton argument, but dropped during the course of the hearing: see paragraph 8 of the judgment. Another point on D4/5’s intention to mount a standalone challenge to the second stage permission to bring a derivative claim was dropped during the course of submissions, although junior counsel, Mr Samuels, had been prepared to argue it at the hearing. This narrowing of the issues is to be encouraged and I do not criticise that. However, the need to drop those points is a further illustration of the defendants having taken every point and run with them until a very late stage.

25. That approach is also reflected in the approach taken to full and frank disclosure. The authorities are clear. Such points are to be taken with a degree of restraint and a sense of proportion and limited to clear cut points which are obviously important: see Mex Group Worldwide Limited v Ford [2025] 1 WLR 975 at paragraphs 112 and 127 to

128.

26. The Claimant’s second schedule shows that in their evidence the defendants between them alleged some 44 breaches of the duty to make full and frank disclosure. By the time of the hearing the defendants between them alleged about ten breaches which I dealt with at paragraphs 116 to

128. But for two of the alleged breaches, none were clear cut and none were important. I concluded at paragraph 128 that most of the allegations were not breaches of the duty of full and frank disclosure at all or they were trivial. The only clear cut and important points related to Mr Moskwa's evidence; and if the defendants had heeded the Court of Appeal in Mex Group only those two points would have been raised.

27. In my judgment, the kitchen sink approach taken by the defendants is unreasonable conduct to a high degree and is “out of the norm”. All of the defendants have adopted the approach. I have therefore decided to award the claimant its costs on the indemnity basis. Reduction for failure to make full and frank disclosure

28. In the judgment at paragraphs 117, 118 and 128 I explain that there was a failure by the claimant to make full and frank disclosure that the expert evidence of Mr Moskwa was not independent. I did not, however, set aside the order for service out of the jurisdiction or stage 2 permission to bring a derivative claim because of that failure.

29. Where there has been a breach of the duty, the court takes a penal approach, and intentionally so, by way of deterrent, to ensure that applicants, in future, abide by their duties. I agree with Mr Purchas, speaking on behalf of all of the defendants, that there should be a penal element to the order I make to reflect the claimant's failure to make full and frank disclosure in relation to Mr Moskwa.

30. This was a serious breach of the duty to make full and frank disclosure.

31. I have had a helpful note over the weekend from Mr McPherson and Mr Shi for D2 and D3, which outlines the chronology relating to Mr Moskwa's evidence. The chronology is such that although, in circumstances which have not been fully explained, Mr Moskwa signed the independent expert's declarations when he ought to have known that he could not properly do so, that is something that was admitted, not immediately, but relatively quickly, after it was pointed out to the claimant's solicitors. Mr Alun Jones prepared a witness statement apologising for the failure and stating that it was an inadvertent failure and that there was no malicious intent. It would not ordinarily be sufficient to provide such an apology without a full explanation of the error. There being no suggestion by the Defendants that the failure might have been deliberate or malicious, I assume that the failure was the result of inexcusable and grossly negligent conduct which only just falls short of deliberate and malicious breach of the duty to make full and frank disclosure.

32. The early admission of the breach, and the apology (even if missing the full explanation which should have accompanied it), is something which ought to be taken into account when considering what the nature of the penal element should be. The court should discourage and deter parties from failing to make full and frank disclosure. At the same time, the court should encourage those who have failed to make full and frank disclosure to accept that they have not done so and to make that clear at the earliest stage.

33. The defendants say that I should apply a discount of 25% to the costs that they have to pay as an appropriate penalty to the claimant. I do not think that is the right approach. I do not see why, in this case, the defendants should get the benefit of the penal element which the court is imposing on the claimant, particularly in circumstances where their conduct merits an indemnity costs order.

34. I propose to deal with this by ordering that the order made by Deputy Judge Tom Smith KC is varied or adjusted so that the claimants are disallowed 33% of the costs which would otherwise be costs “in the case”. On the figures given to me by Mr Dinsmore today, the total costs of the applications before the Deputy Judge amount to some £750,000. 33% will therefore mean that C is debarred from recovering some £250,000 of costs it has incurred; and that seems to me to be an appropriate penalty. Interim payment

35. CPR rule 44.2( 8) provides that where the court orders a party to pay costs, subject to a detailed assessment, it will order that party to pay a reasonable sum on account of costs unless there is good reason not to do so.

36. A reasonable sum is an estimate of the likely level of recovery, subject to an appropriate margin to allow for error in the estimation, rather than an irreducible minimum; Excalibur Ventures LLC v Texas Keystone [2015] EWHC 566 (Comm) at paragraphs 22 to 24 per Christopher Clarke LJ. It was said in Excalibur Ventures that it is appropriate to take a figure which is not too much below the estimate, for example 5%.

37. When indemnity costs are ordered and there is no approved cost budget it is not unusual to see a payment on account in the range of 60 to 75%. The claimant's costs of the jurisdiction challenge are said to be just under £2.457 million. This figure does not include various aspects of costs which will be dealt with separately.

38. This is a very high figure but the claimant says that (a) its costs have been increased by the kitchen sink approach taken by the defendants, and (b) the defendants together sought security for their costs on the basis that their combined costs of the jurisdiction challenge were estimated to be £2.747 million. Until this morning, the defendants had declined to state what fees they had actually incurred so that it could be used as a comparator. Mr Purchas today, in his brief reply submissions, started to give me some figures. Mr Dinsmore objected on the basis that the claimants have been asking for this information for some time, it has been deliberately withheld to date, and he is not now in a position to consider it or make submissions on it. That is a fair objection to me trying now to take into account what the defendants say are the actual costs incurred as some sort of comparator and I do not do so. Having said that, the figures which were being mentioned by Mr Purchas were not a long way away from the sums which the claimants say they have incurred.

39. Mr Purchas says substantial deductions are likely to be made on a detailed assessment even on an indemnity basis. A number of points are made about aspects of the bill, which bill is in very summary form, for example as to guideline rates and costs which have already been the subject of the order, but these would only reduce the bill by about £100,000 or £150,000.

40. Mr Purchas points out there are some £900,000 for counsel's fees, including £654,000 for the five day hearing before me. He points to his fees and that of his junior by way of comparison at £173,000, but, of course, the defendants split the arguments between three sets of defendants, whereas the claimants had to deal with them all; so it is not surprising that the claimant's counsels’ fees are higher than any particular one of the three sets of defendants. Whether they should be quite as high as they are is another matter.

41. I do not feel that I am very well placed to make an accurate estimate of the likely level of recovery. I will do the best I can, but the costs judge should not place weight on this assessment as to the amount that should be awarded after assessment. I will make an interim payment of 65% of £2.467 million, which, rounded up or down, will be the sum of £1.6 million. Stay of interim payment

42. Mr Purchas, on behalf of the defendants as a whole, says that there should be a stay of any interim payment of costs pending appeal. Each of the defendants has applied for such a stay. CPR 52.16 makes clear that an appeal shall not operate as a stay of any order of the lower court. The court has a power to order otherwise. That power is exercised if the court is satisfied that there is a risk of injustice to the proposed appellant in not granting a stay which outweighs the risk of injustice to the proposed respondent from the grant of a stay. It is for the proposed appellant to put forward reliable evidence to show that there is some serious injustice to that proposed appellant if the stay is not granted.

43. In this case, what is relied on is the fact that the claimant is impecunious – it is balance sheet insolvent. Its conduct of this litigation has been funded by shareholder loans. No comfort or security is offered on the part of the claimant that the funds paid to the claimant will not be used to discharge those loans or that such funds will be repaid if an appeal is successful and the order for interim payment of costs is set aside.

44. Mr Dinsmore referred me to Sir Lindsay Parkinson v Triplan [1973] QB 609 (CA) and to a passage which refers to the considerations which a court may take into account when considering whether to order security for costs against an impecunious company. One of those factors is whether the company is impecunious because of the alleged conduct of the defendants. In this case, Mr Dinsmore says that the claimant is impecunious because of the alleged fraud committed by the defendants. But what was said by Lord Denning MR in Sir Lindsay Parkinson v Triplan was said in the context of whether a discretion should be exercised to order an impecunious claimant to pay money into court as security for costs as a condition of being allowed to pursue its claim. Here the question is whether it provides a reason why money should be paid to the impecunious company which might not be repaid if it turns out it is not entitled to that money. If the claimant would struggle without that money, it might be a relevant consideration that the company is impecunious because of the alleged actions of the defendants but there is no evidence of that. Importantly, it is not submitted by the claimant that a stay will stifle its defence of these proceedings or an appeal. Mr Dinsmore says that it is unfair that the claimant having injected, he says, some £4.21 million, both in respect of the costs which it has incurred and security for the defendants' costs, should have to find yet more money to continue to deal with the appeal without receiving any funds, but that is not the same as saying that it cannot do it.

45. It seems to me that, in principle, the balance of justice is to hold the ring until at least the determination of the application for permission to appeal. Whatever happens thereafter, if permission is granted, can be resolved by the Court of Appeal.

46. The claimant says that there is an irreducible core of costs of some 80% of its costs which will never have to be repaid. I have some sympathy for Mr Dinsmore's submission that if the defendants had been successful before me that I might have not allowed them to recover their costs in full because of the manner in which these proceedings had been conducted. But Mr Dinsmore's submission goes one step further and says that he would actually have obtained an order for some 80% of his costs against the successful defendants. Whether that is right I am not sure.

47. The problem which I have with Mr Dinsmore's submission is that I am being asked to make a series of hypothetical assumptions . I would have to assume that permission to appeal is granted on grounds of appeal which would have the effect that some part of service or service on one or more parties is set aside. I would have to assume that that appeal was successful; and then I would have to hypothesise as to what the Court of Appeal would then do in respect of costs and the costs orders which had been made. It seems to me that that is impossible for me to do at this stage. It might be easier for the Court of Appeal to do if it decides to grant permission on certain grounds of appeal when the matter is before it; but that simply means that an application of this kind can be re-run before the Court of Appeal.

48. So I will stay the order for the interim payment of costs pending an application for permission to appeal to the Court of Appeal. However, I do not see why those costs should not be paid into court in the interim. I am told that the defendants can and will pay that sum. I will make an order for the interim payment to be stayed pending an application for permission to appeal to the Court of Appeal on condition that it is paid into court. Release of security for costs

49. The claimant says that a substantial amount of the monies which it has paid into court for security for costs should be released. The amount which remains in court at the moment, and is not already the subject of an agreement between the parties for release, is some £1.6 million.

50. Mr Dinsmore says there are material changes of circumstances since it was agreed that security for costs would be provided. At that stage, it was not clear how many points which the defendants were relying upon would be dropped; and that there would ultimately be very limited challenge to the factual assertion in the pleadings. The scope of the jurisdiction challenge had narrowed by the time it was heard.

51. Tthe position now is also very different from the time when security for costs were agreed. Now the claimant has the benefit of a judgment. It has been successful and the prospects of the defendants overturning the order for costs and getting an order for costs in their favour requires them to overcome a number of hurdles, such as obtaining permission to appeal on a ground which matters, being successful in that appeal and then also overturning the order for costs which has been made. The odds, at this stage, are now stacked against the defendants and that seems to me to be a relevant consideration.

52. There is another difference, between this and the order for interim payment of costs on account. Mr Dinsmore said it is less messy and that was an accurate, if colloquial, description. If an order is made for an interim payment then, were the costs order to be set aside in the event of a successful appeal, that money would have to be repaid. Whereas if I order the release of security for costs then that simply means that the defendants, who are now in a very different position, will just have less security for costs, whatever happens on the appeal.

53. I am going to order the release of the security for costs but stay that order as to 50% until the determination of an application for permission to appeal. Costs of the security for costs application

54. The security for costs I have just referred to were the subject of applications by the defendants which came before ICC Judge Barber on 10 April 2025 when she made an order for the payment into court by way of security for costs. The costs of the applications were adjourned to be dealt with at a further hearing, and were subsequently directed by Deputy ICC Judge Frith to be determined at this hearing.

55. The defendants say that costs should follow the event and the claimant should pay their costs. The combined defendants' costs are some £300,000 and Mr Purchas says there should either be summary assessment or detailed assessment and a payment on account. He submits that the claimant's approach to the applications was obstructive, tactical and, insofar as it came to actually making an effective proposal, unsatisfactory.

56. The claimants say they have some £206,000 of costs and that those costs should be in the jurisdiction challenge; in other words, as the claimant has won the jurisdiction challenge, the claimant should have its costs of the defendants' application for security for costs.

57. It is right to say that the amounts of costs which have been incurred in relation to a dispute which did not last very long in the scale of things and is subject to some limited issues as to quantum and form of security for costs are extremely high.

58. I have been taken through the chronology by both sides in relation to the applications for security for costs. A request was made for security for costs in July 2024 by D2 and D3 and the principle that the claimant should provide security for costs was accepted by the claimant on 6 September 2024. .

59. There was then some discussion about amounts, which did not go anywhere. There was clearly a considerable difference between the position of the parties, with the defendants saying they were estimating their costs to be £870,000 while the claimants offered £195000. The first defendant accepted in principle a figure which was put forward by the claimant, but that did not go anywhere; and, in the meantime, increased cost estimates were advanced by the defendants.

60. In the end, an application was issued by D2 and D3 on 21 January 2025 and followed by the other defendants. Their estimates were provided during the course of January and February. Eventually agreement was reached with the claimant in March as to the amount which would be paid – £1.75 million.

61. That was, in the claimant's mind, tied to an offer that that sum would be provided by way of a guarantee, but the terms of that guarantee were not agreed. There were discussions in correspondence in relation to what bank should provide that guarantee and what its terms should be; but by the time of the hearing on 10 April no draft of the guarantee had even been provided by the claimant to the defendants to consider. At that hearing ICC Judge Barber simply ordered that the money be paid into court.

62. Against that background, the defendants say they had to issue the application; there had to be a hearing; they won; they should have their costs; and that, because of the obstructive approach which they say the claimants took, they say they should have their costs on an indemnity basis.

63. The claimant says it accepted in principle that it should provide security for costs in September 2024, thereby narrowing dramatically the issues between the parties; that desultory negotiations came to nothing when the figure in play was £870,000. Full figures were not provided until 17 February 2025 and it agreed the full amount in March. It says the hearing simply had to happen because there was not time for details like the guarantee to be finalised and the parties simply ran out of time by the time that agreement as to quantum had been reached.

64. In my judgment, the avoidance of the costs of the application or the hearing were matters which were within the claimant's control, either in squeezing the figures out of the defendants, agreeing to pay it, actually paying it into court or providing some alternative mechanism, such as an acceptable guarantee, and providing the necessary documentation in draft for the defendants to consider. The bottom line is that it did not do those things. The defendants had to issue an application. There had to be a hearing because the claimant did not make an acceptable offer to compromise it, which included how the security was to be provided. So I will make an order for the claimant to pay the defendants' costs of the security for costs application, to be assessed on the standard basis.

65. As for the base of assessment, this is not conduct which, in my judgment, is out of the norm, and it smacks of difficulties arising out of the complexity of the dispute between the parties. These are costs which will be assessed on the standard basis. I will make an order for a payment on account of 40%. It will be 40% because I do think that the costs of £300,000 for a limited application for security for costs where the principle that security for costs will be provided has been accepted are extremely high. Applications for permission to appeal

66. The judgment was handed down on 25 February 2026 and the time for appealing was extended until an order made either by agreement or at this consequentials hearing. Each of the defendants indicated an intention to appeal at the end of April of 2026 and grounds of appeal were circulated shortly before this hearing, on 15 and 18 May.

67. There are a number of general observations to be made about these grounds of appeal.

68. The kitchen sink approach of the defendants to this jurisdiction challenge, which has resulted in costs being ordered against them on the indemnity will, it seems, be continued in the Court of Appeal. There are about 30 grounds of appeal divided between the defendants with some overlap.

69. In the main, they challenge the conclusion that the claimant has an arguable claim but there is no killer blow. They are in substance a challenge to (a) evaluative decisions based on assumed facts, and (b) an exercise of judicial discretion, such as whether to grasp the nettle at this early stage of proceedings on a question of construction.

70. The approach of an appellate court to an evaluative decision is well settled: see Prescott v Potamianos ( also known as Re Sprintroom) [2019] EWCA Civ 931, where the Court of Appeal said, after reviewing the authorities: "So, on a challenge to an evaluative decision of a first instance judge, the appeal court does not carry out a balancing task afresh but must ask whether the decision of the judge was wrong by reason of some identifiable flaw in the judge's treatment of the question to be decided, 'such as a gap in logic, a lack of consistency, or a failure to take account of some material factor, which undermines the cogency of the conclusion'."

71. An analogous approach is taken to an exercise of discretion.

72. Several grounds relate to arguments raised below which were not expressly dealt with in the judgment and I am now asked for a supplemental judgment purportedly in line with the guidance in English v Emery Reimbold and Re S (Children) [2007] EWCA Civ

694. That guidance is that counsel should raise “on the spot” an omission by the judge to deal with a point if it is intended to use that omission as a ground of appeal.

73. Although now stated to have critical importance, having asked Mr Purchas, Mr Samuels and Ms Gonin, it seems that the thought that the alleged omissions should be dealt with in the judgment did not occur to the five counsel and three firms of solicitors when judgment was handed down in draft or, it seems, in the ensuing months before draft grounds of appeal were prepared. The point of asking the judge “on the spot” to deal with omissions is that matters are fresh in the judge's mind; and it is very unsatisfactory to raise alleged omissions months after judgment has been handed down.

74. I am not going to provide a supplemental judgment. These were makeweight points in line with the defendants' kitchen sink approach, none of which moved the dial and did not merit inclusion in the judgment.

75. Turning then to the grounds of appeal. D1’s grounds of appeals

76. Grounds 1 to 8 all relate to the decision in paragraph 98 to 111 not to strike out or grant summary judgment against the claimant because the claimant had an arguable claim that the first defendant had breached the terms of the SSA. Grounds 1 to 8 appear to simply re-run the arguments put to me by D1 and which did not persuade me then and do not persuade me now.

77. On ground 1 the contention that the judge did not conduct an analysis of the SSA is clearly not correct. I think the point sought to be made is that the judgment does not show D1’s analysis of the SSA, but that is not the same thing. There was no error of law.

78. The contention in ground 1 that the strike out/summary judgment should be determined entirely on the pleaded case without reference to the factual matrix which might emerge at trial is unarguable. In any event, the factual matrix of a long-standing joint venture relationship based on trust was sufficiently pleaded at paragraphs 15 to 17 of the amended particulars of claim.

79. I note that ground 3 reads words into the judgment which are not there.

80. Grounds 1 to 4 on their own are not sufficient for overturning the decision unless ground 5 and ground 7 succeed.

81. Ground 5 suggests that strike out/summary judgment should be granted on a pleading point even though claimant's case at the hearing was quite clear. It is also unarguable.

82. Grounds 6 and 8 do not arise unless one of grounds 1 to 4 and ground 5 succeed.

83. Ground 7 is remarkable, D1 having not applied to strike out the Article 415 claim on this ground or at all: see the judgment at paragraph

74.

84. Grounds 9 and 10 relate to full and frank disclosure, which I decided was not a breach of the duty or was trivial. There is no real prospect of an appellate court interfering with that evaluative decision and exercise of discretion.

85. Ground

11. These are makeweight arguments which do not move the dial and did not merit inclusion in the judgment: see the judgment at paragraph

110. D2/3 Grounds of Appeal

86. D2/3 advance eight grounds of appeal.

87. Grounds 3 to 8 overlap with D4/5's grounds of appeal and I will not consider them separately.

88. Grounds 1 to 2 are premised on a contention that whether there was a serious issue to be tried justifying service out of the jurisdiction should be determined by a strict construction of the pleadings frozen in time at the time of the hearing including whether pleaded contentions were sufficiently particularised in the pleadings and disregarding the possible provision of further information by amendment or pursuant to Part 18 in future and disregarding the factual evidence which was currently available or might in future be available.

89. This was a point raised by Mr Hayman for D2/3 at the end of the defendants' combined submissions at the hearing in November, contradicting Mr Purchas' prior acceptance for D4/5 that this was not the law. I dealt with this contention at paragraphs 40 to 42 of the judgment. No attempt is made by D2/3 in the skeleton argument put before me today to challenge the analysis of the law in those paragraphs. D2/3's position is not the law and it seems to me to be unarguable.

90. Two authorities were cited to me at this hearing in support of D2/3's position. The first was Okpabi which does not support the contention that a judge in a jurisdiction challenge must decide whether there is a serious issue to be tried from the four corners of a pleading before him or her. That case says that the defendants should not seek to challenge pleadings and witness statements filed by the claimant at the jurisdiction stage and that a proportionate approach is to focus on the pleading. The second authority which was relied on was Magomedov, where Mr Justice Bright made clear to the parties in that case, where there had been repeated attempts to repair the pleading, that his approach would be to consider only the case set out in the re-amended pleading. That was well within the judge's case management powers, but it is not authority for the proposition that all jurisdiction challenges must now be determined from the four corners of the pleading in the form in which it is at the time of the jurisdiction challenge.

91. I would add that it would be a regressive step back into the pre-CPR world if Mr Justice Bright's comments were to result in the judge in future jurisdiction challenges being subjected, as I have been, to the forensic picking apart of a pleading in the search for a technical flaw or a failure to plead some particular fact or assertion, although known. D4/5 Grounds of appeal

92. Grounds 1.1 and ground 1.2 must both succeed, one or the other is not sufficient to change the outcome of the hearing. Ground 1.1 might be an arguable ground of appeal, but ground 1.2 is not. Firstly, the pleading point is a bad one for the reasons I have already given. Secondly, the classification of the point being made in paragraph 86 as an argument that the subrogation to the debt was invalid is wrong and misunderstands paragraph

86. It is clear that the claimant's expert evidence says that whether or not there was a valid subrogation to the bank's debt under Polish law, there is a remedy under article 415 in respect of the loss caused by that if it formed part of a fraudulent scheme.

93. Ground 1.3 and ground 1.4 are simply re-arguing points run below and are a challenge to an evaluative decision without identifying a flaw in the approach.

94. Ground 2 might be an arguable ground of appeal, but Mr Purchas accepts that it will not alter the outcome unless he succeeds on one of grounds 1.1 to 1.4.

95. Ground 3 is simply re-arguing points run below and is a challenge to an evaluative decision and the exercise of discretion without identifying a flaw in the approach.

96. Ground 3.4 is a supposedly crucial omission from the judgment which was not identified by D4/5 until preparation of the grounds of appeal. It merited one sentence at the end of a paragraph in D4/5’s original skeleton argument. It did not add any value to D4/D5's submissions and it did not merit separate treatment in the judgment. The key point for the Deputy Judge was that the failure to file a defence was said to have been procured by fraudulent misrepresentation. What the defence would have said was not to the point. Whether what has subsequently been discovered amounts to fresh evidence going in the same direction as the matters which the claimant knew at the time of default judgment is a matter for trial.

97. Ground 3.5 requires particular mention. In my judgment I said at paragraph 117 that Mr Moskwa's evidence was honest, impartial and accurate and reiterated this, or parts of this, at paragraph

128. I was not making a finding that I accepted Mr Moskwa's evidence in preference to the defendants' expert evidence. I made clear at the hearing, and in the judgment, that I was not making findings on the expert evidence at this nascent stage of the proceedings. What I meant was that the fact that Mr Moskwa was Durnont's Polish lawyer and not independent had not had a bearing on his legal analysis and conclusions, which were subsequently reiterated and agreed by the independent expert instructed by the claimant.

98. With that clarification, Mr Samuels accepted there was nothing left in ground 3.5. I observe, again, that if the defendants genuinely thought that I had made a finding which would bind them at trial that would have caused serious concern. I would have expected them to have clarified it immediately when the draft judgment was circulated or at some point in the months since judgment was handed down.

99. Ground 4 does not arise unless D1 is successful or D4/5’s ground 1 is successful.

100. For those very brief reasons, I will refuse permission to appeal on any of the grounds which have been advanced by the three defendants, but, of course, they may renew their application for permission to appeal to the Court of Appeal. ______________