Sunil Gupta, Sunil Gupta M.D. LLC LLC d/b/a Retina Speciality Institute (a Delaware limited liability company) v Olgun Halil-Shah, Lex Foundation Limited, Nurel Halil-Shah & 3 Ors

	No Substantial Judicial Treatment

Court
Chancery Division
 
Judgment Date
28 January 2022
 
No. BL-2021-000873
High Court of Justice Business and Property Courts of England and Wales Business List (ChD)
[2022] EWHC 318 (CH), 2022 WL 00301857
Before: Mr Justice Michael Green
Friday, 28 January 2022
Representation
 	Mr M. Glover (instructed by Portner Law Ltd ) appeared on behalf of the Claimants.
 	Mr P. Lowenstein QC and Mr P. Jones appeared on behalf of the Second and Third Defendants.
Judgment
Mr Justice Michael Green:
 
1.  By their application notice dated 24 November 2021, the claimants applied for unless orders against the first to third defendants in respect of various alleges breaches of disclosure orders made ancillary to freezing orders. There have been a large number of orders made in these proceedings and the claimants have taken the decision to take this to the next stage of seeking unless orders against the defendants rather than, say, alleging breach and pursuing committal proceedings. They are in fact pursuing committal proceedings against the first defendant but that application is not yet listed to be heard.
 
2.  I am concerned today with only the second and third defendants. The third defendant is the wife of the first defendant. A series of unless orders are sought by the claimants against the second and third defendants with the dramatic sanction of their respective defences being struck out if there is continued non-compliance.
 
3.  Mr Mark Glover appears for the claimants and Mr Paul Lowenstein QC and Mr Philip Jones appear for the second and third defendants. This hearing was listed pursuant to the direction of HHJ Claire Jackson on 25 November 2021.
 
4.  It was only earlier this week, late on Monday, and only seen I think by the claimants on Tuesday morning, that the third defendant served a witness statement on her and the second defendant’s behalf, resisting the application. Mr Lowenstein has sought to explain why it was served so late. He said that there was a confusion amongst the lawyers on his side over what this hearing was about, and it was only last Friday that they realised that it concerned the claimants’ application for unless orders. On any view there was very belated compliance with some of the orders that have been made, but Mr Lowenstein said that the defendants have now effectively provided all the information and disclosure that they have, or that the claimants have obtained all such information through other means, such that it would be inappropriate, indeed disproportionate and unjustified, to make such a draconian unless order against them now.
 
5.  Mr Glover says that unless orders, even after the late disclosure in the third defendant’s witness statement, is entirely appropriate in a case where the defendants have shown severe disregard for the orders of this court and where what they are saying cannot be believed. Mr Glover has amended the draft order that he is asking me to make from that which was submitted with the application notice and the evidence in support. It seems to me that the amendments that he has made to that draft order are quite material and I will have to consider whether it is appropriate to make those further orders that were not included in the original application.
 
6.  The underlying claim is that the first claimant, an American eye surgeon, and his company, the second claimant, say they were defrauded by the first and second defendants who persuaded them to transfer some US$14 million to them in order purportedly to be invested into a scheme that would yield returns of 100 per cent per month over ten months. Needless to say, after the money was transferred to accounts in the first defendant’s name on 30 November 2020 and 2 December 2020, there have been none of the promised monthly returns paid to the claimants; nor has the $14 million been returned to the claimants.
 
7.  Understandably very concerned about what had happened to their money, the claimants applied to Snowden J, as he then was, on 27 May 2021 for freezing and proprietary relief and that was granted (” Snowden order “). At that stage, the claim and injunction were only against the first and second defendants. The usual ancillary disclosure orders were also made. It was later discovered that, four days after that order, on 1 June 2021, the first defendant had actually transferred $9.9 million to his wife, the third defendant. Following discovery of that, a freezing injunction was made against the third defendant by ICC Judge Jones, sitting as a High Court judge on 5 August 2021. That has been called “ the first Jones order “. That too had the usual disclosure orders ancillary to the freezing and proprietary relief that it granted.
 
8.  Prior to then, the claimants had actually made a committal application against the first defendant for breaches of the Snowden order. As I said above, that has still to be listed. The claimants also made various Bankers Trust applications to third party banks for disclosure of bank statements and orders have been obtained against, inter alia , Lloyds, HSBC and Citibank. Those reveal that monies have been paid to the first and third defendant’s children. The claimants say that this was paid out of their funds. The children have been joined to the proceedings as the fourth to sixth defendants and the claimants have pleaded the same causes of action against them.
 
9.  An injunction was sought against the fourth to sixth defendants and this was granted, again by ICC Judge Jones, on 20 August 2021, and that has been termed “ the second Jones order “. In that order, additional disclosure obligations were made against the defendants in respect of a payment out of the third defendant’s account in the sums of £2.04 million and £30,000. The transfer of £2.04 million was made to a bank account in the first defendant’s name in Northern Cyprus. The second Jones order required disclosure in relation to those sums and for the £2.04 million to be paid into court, or whatever was left of it.
 
10.  The matter then came before Bacon J on 8 September 2021 when, by consent, she made an order requiring the second and third defendants to disclose correspondence between themselves and with the other defendants. They were also ordered to disclose financial statements, something which they did not do until some belated disclosure earlier this week in the third defendant’s witness statement.
 
11.  The defendants issued discharge applications. Mr Glover says that those were intended to and did effectively derail the process of seeking compliance with the orders of the court. Those discharge applications were eventually withdrawn in late November, just before the hearing before HHJ Jackson, and they were dismissed.
 
12.  Before turning to the particular issues, it is as well to keep in mind both the purpose of ancillary disclosure orders and unless orders. The purpose of ancillary disclosure is to enable a claimant to police the freezing and proprietary injunction. It is not to get advance disclosure in the proceedings. The courts are very willing to assist in the tracing of assets, particularly in a case like this where there are serious allegations of fraud and there is evidence that the defendants have not been complying with court orders and not been forthcoming about what they have done with the claimants’ money. But the line has to be drawn somewhere and there has to be a sense of proportion. Mr Glover also said, and I accept, that a purpose of ancillary disclosure orders can be to identify assets against which the claimants can eventually enforce a judgment.
 
13.  One has to, as I have said, keep a sense of proportion. If information has been obtained from another source, what is the point of ordering the defendants to find those documents, and in particular, under the threat of an unless order? Similarly, if information has been provided, albeit late, which the defendants say is everything that they have got but the claimants do not believe them, is it appropriate to make an unless order where the same response will presumably be provided and then there will be an argument as to whether there was compliance or not, with the sanction of the defence being struck out? Surely, if they do not believe the defendants, they should either ask to cross-examine them or should pursue committal proceedings. I question whether an unless order is the correct response to the disclosure that has been made.
 
14.  Mr Lowenstein referred to Marcan Shipping (London) Ltd v Kefalas & Anor [2007] 3 AE 365 , and also to the well-known case of Denton v TH White Limited [2014] EWCA Civ 906 for the proposition that unless orders are a powerful weapon of the court and should only be deployed if the consequences can be justified. They must be truly necessary in order to allow litigation to proceed efficiently and at proportionate cost. I do question whether this was the appropriate route to go down in the circumstances pertaining.
 
15.  I think there is a more fundamental objection too. In Marcan , the Raja v Van Hoogstraten [2004] EWCA Civ 968 case was referred to. There, in amongst all the orders that were made, was an unless order for compliance with the ancillary disclosure order. I detect that the Court of Appeal thought it inappropriate to make such an order in relation to ancillary disclosure which was not concerned with the actual defence of the proceedings. In my experience, this is very unusual and the norm would be that if there is unhappiness with the compliance, to pursue committal or cross-examination. An unless order should only be resorted to, with the dramatic sanction proposed, if the court has no other option and it would otherwise interfere with a fair trial and the proper administration of justice.
 
16.  Mr Glover referred in his reply to some authorities in which he said that it was commonplace for unless orders to be made in these circumstances. I am not aware of those authorities, and it seems to me and the experience that I have had is that it is an unusual step to take. I do not think we are in that territory here. The claimants certainly do not trust anything that the defendants say, perhaps with good cause, but is the unless order route really the way to go?
 
17.  Turning to the actual application, it was a little difficult to follow in the skeleton arguments but it does appear to me that there are effectively six separate issues, alleged breaches of earlier orders, in respect of which unless orders are sought.
 	(1)  First of all in relation to the second defendant, the company, there are aspects to do with the Snowden order;
 	(2)  Secondly, in relation to the second defendant, there are aspects to do with the Bacon order; and
 	(3)  then there are four matters concerning the third defendant, that is in relation to the first Jones order, the second Jones order, another matter under the second Jones order, being the fee sum of £30,000, and, finally, the Bacon J order. 
 
18.  Turning to the first matter, that is the second defendant in relation to the Snowden order, Snowden J ordered the first and second defendant to provide certain information, as is usual, in relation to the freezing order. Paragraph 9(1) of the Snowden order says as follows:
”Unless para.9(3) applies, the respondent must by 4 p.m. on 31 May 2021 and to the best of his ability inform the applicant’s solicitors of:
 
(i)  details of the bank accounts in which the funds are now and/or where the funds or part of them have been transferred to, and from since 30 November 2020, giving the value, location and details of all such holdings and/or transfers with documents in support;
 
(ii)  details of all assets supplied in part or in whole of the fund giving the value, location and details of all such holdings with documents in support;
 
(iii)  the details of all debts paid off in part or in whole of the fund, giving the value and details of all such debts and documents in support; and
 
(iv)  the details of all entities to whom part or the whole of the fund has been transferred, giving the value, location and details of all such holdings with documents in support.”

19.  So that is dealing with what has happened to the claimants’ money and tracing it. Paragraph 9(2) is in relation to the respondent’s own assets, so in relation to the second defendant, its assets, and it says:
”Unless para.9(3) applies, the respondent must by 4.00 p.m. on 2 June 2021, to the best of his ability, inform the applicant’s solicitors of:
 
(i)  all his assets worldwide exceeding £10,000 in value whether in his own name or not and whether solely or jointly owned, giving the value, location and details of all such assets.”
 
There does not appear to be a (ii) but that is the end of sub-para.(2) and para.9(3) is the usual privilege against self-incrimination.
 
20.  Mr Lowenstein informed me that basically the first defendant, on behalf of himself and on behalf of the second defendant, was effectively relying on the privilege against self-incrimination and has therefore not provided the information in response to that order. That is why, I assume, the committal proceedings have been commenced. Clearly, the information in there can only sensibly come from the first defendant, and that is, as I say, why the claimants are pursuing the first defendant for contempt. The claimants already have statements now for the second defendant’s only bank account. The only purpose of making an unless order against the second defendant is, it seems to me, to get its defence struck out.
 
21.  Similarly, in respect of the second defendant’s own assets, the third defendant has belatedly stated that it, the second defendant, has no assets apart from its potential claim against Citibank for US$10 billion. Mr Glover says that in filing the third witness statement, the third defendant has effectively taken on the responsibility of responding to the orders on behalf of the second defendant, as she is a director of it. She and the fifth defendant, as I understand it, are directors of the second defendant, together with the first defendant, and what is said is that they should effectively compel the first defendant, as the director of the second defendant, to provide all the necessary information. I have just been corrected. The fifth defendant is not now a director of the second defendant, and I assume the only two existing directors are the first and third defendants. What this order seeks is that the third defendant compel her husband to provide the necessary information with which to answer these questions or orders as fully as the claimants would like.
 
22.  I understand that the claimants feel that they have yet to receive any proper details as to what has happened to their $14 million, and Mr Glover explained to me some of their concerns as to where their money has ended up. I understand their desire to drill down on the information that they have and to seek to find out what the defendants’ case is on that, but it does seem to me to be somewhat contrived and unrealistic where the first defendant is being pursued for contempt and that the argument is that the third defendant should now force him to comply with the orders on pain of having their defences struck out. I do not see that that is a proper use of the unless order jurisdiction. In so far as they do not like the answers that have been provided by the third defendant on the second defendant’s behalf, they have, it seems to me, other remedies.
 
23.  The next part of the application in relation to the second defendant concerns the Bacon order and that was made, as I have said, on 8 September 2021 by consent, and that is significant, that the defendants were agreeing to the terms of this order. Paragraph 7 of the Bacon order provides as follows:
”The defendants shall by 4 p.m. on 22 September 2021 disclose to the claimants any and all statements which show a receipt of £500 or more for any bank or financial institution, whether located in this jurisdiction or not, with whom they have or had a financial product for the period 27 November 2020 to date, unless such statements have been previously disclosed to the claimants. For the avoidance of doubt, the defendant is to be regarded as having a financial product if a third party holds or controls the product in accordance with their direct or indirect instructions.”

24.  Paragraph 8 is as follows:
”The defendants shall by 4 p.m. on 22 September 2021 provide to their legal representative all correspondence with one another for the whole period 10 November 2020 to date on compliance. The defendants’ legal representatives shall, by 4 p.m. on 6 October 2021 give disclosure by copies of that correspondence, which may be redacted to remove text of a purely personal nature (e.g. in relation to health matters) that does not fall within CPR 31.6 . For the avoidance of doubt, correspondence is to include but is not limited to emails and text messages in their native format.”

25.  In the witness statement in support of this application, the maker of that witness statement does not refer to the second defendant as being in breach of these orders. That is presumably because of a recognition that the second defendant can only act through human agency, namely its directors, the first and the third defendants. It cannot act independently of them. It is a bit of a nonsense, it seems to me, to require the second defendant separately to comply with these personal orders to disclose communications. In so far as there was correspondence including the second defendant, then it will have been disclosed by the other defendants, and the fourth to sixth defendants, even though included within the Bacon order, are not being pursued in relation to this. They have disclosed all of the correspondence that they say exists between the defendants and none, as I understand it, includes any correspondence separately with the second defendant, the company.
 
26.  The claimants are asking for evidence, it seems to me, as to the efforts that have been made to comply with that order, in terms of what searches were made and what steps were taken to ensure that there was proper compliance, but I question whether that is appropriate in relation to ancillary orders in a freezing order. That was not what the order provided for. The order provided for disclosure of correspondence and the answer has been received that there was in fact no correspondence involving the second defendant.
 
27.  As to the financial statements, Mr Glover says that there is evidence that shows that the second defendant likely had other bank accounts. There has been no confirmation he says from the third defendant that the second defendant does not have any other bank accounts, including outside of the jurisdiction, and there are some references in some of the documents that he showed me that might suggest that the second defendant did indeed have other bank accounts. But the simple fact of the matter is that the claimants already have the statements from the one account of the second defendant that the third defendant says exists, and the order only requires statements to be provided, not any other information.
 
28.  Mr Glover also sought to amend the draft order by including within the order the following words, after requiring the second defendant to comply with paras.7 and 8 of the Bacon order:
”(Including but not limited to the provision of information concerning financial products held by a third party and the disclosure of emails in native format).”

29.  That it seems to me is going far too far. The emails have, as I understand it, been disclosed in native format, but going back to the order of Bacon J, she only required, and the defendants only consented to provide, statements of bank accounts in the name of the particular defendant or held on its behalf. The order did not require disclosure of any other information or confirmations in that respect, it only required statements, and in my view it is inappropriate to broaden the order under the aegis of this unless order application. It is not necessary, and indeed I consider there is no basis, to make an unless order in this respect, and so I reject the application in relation to the second defendant.
 
30.  Turning to the third defendant, the first order is in relation to the first and second Jones orders. In para.9(2) of the first Jones order, this is as against the third defendant, it says as follows:
”Unless para.9(3) applies, the respondent must by 4 p.m. on 12 August 2021 and to the best of her ability inform the applicant’s solicitors in writing, which may be by electronic means but must include a statement of truth signed by the respondent, whatever format is used, of:
 
(i)  all her assets worldwide exceeding £10,000 in value, whether in her own name or not, and whether solely or jointly owned, giving the value, location and details of all such assets.”

31.  So that is the order, a straightforward disclosure order ancillary to a freezing order. She has now done that in her third witness statement. She has belatedly disclosed the existence of one further bank account that the claimant did not know about, and also about her interest in land in Northern Cyprus. In fact, I understand she had previously disclosed that she had an interest in the land in Northern Cyprus in her earlier witness statement but her third witness statement identified it somewhat more narrowly by reference, as I understand it, to the village in Northern Cyprus where it is. But still the actual address was not given.
 
32.  The claimants seem not to like the answer that has been given. Mr Glover says that the real problem, as it has emerged, with the third witness statement of the third defendant, is that it was obviously done in a bit of a rush, and Mr Lowenstein has accepted that they were not anticipating this being the hearing that it now is and that required the third witness statement to be prepared in a hurry. Mr Glover says that that is reflected by its terms which show that it has not been considered carefully enough and that there are holes in it and basically that they should do a better job. In relation to this particular point, the third defendant has given details of the land in Northern Cyprus. She did not give the exact address and that seems to me all that Mr Glover was actually asking for. However there is no evidence that once her interest in the land in Northern Cyprus was disclosed last year, that any further details were asked for by the Claimants, and it seems to me it would be wholly disproportionate to convert that order into an unless order on the back of the failure to disclose the exact address of that land.
 
33.  Sticking with the first Jones order, there is no application in relation to the first part of para.9, which concerns the tracing of what happened to the $9.9 million that was transferred into the third defendant’s account. That is not pursued on this occasion but it has, in a sense, been overtaken by the second Jones order, which deals with a part of that sum, namely the £2.04 million that was transferred by the third defendant into an account of the first defendant in Cyprus. The second Jones order provided in para.2 for the sum of £2.04 million, or any part of it which remains, to be paid into court. That has not happened but even though that provision was included within the original application notice and an unless order to that effect sought, that has not been pursued by Mr Glover before me today. Indeed, it would be wholly inappropriate given that the money has left the third defendant’s possession and control by going to the first defendant, to make an unless order against her when she does not have the money within her control.
 
34.  What is sought is an unless order in relation to para.4, and that, as I said, concerns the £2.04 million. Paragraph 4 says:
”Unless para.4(3) below applies and subject to para.7 below, the first defendant and the third defendant must by 4 p.m. on Friday, 27 August 2021, in so far as they have such knowledge and to the best of their ability, inform the applicant’s solicitors in writing, which may be by electronic means but must include a statement of truth signed by the maker, whatever format is used, of:
 
(1)  information concerning the £2.04 million…”
 
Sub-paragraph (i) says:
”The details of the bank account in which the £2.04 million or any part is now and/or where the £2.04 million or any part of it has been transferred to and from since 22 July 2021, giving the value, location and details of all such holdings and/or transfers with documents in support, including but not limited to bank statements, for the period 28 November 2021 to date of provision.”
The remaining parts of that seek details of any assets acquired using the £2.04 million, any debts discharged in relation to it, and the details of any persons to whom that sum has been transferred.
 
35.  Sub-paragraph (2) concerns the third party who had provided what is called the fee sum, which is a sum of £30,000, that was provided by a Mr Mehmetcik on 10 August 2021, in order to pay for the defendants’ legal fees, and further information was sought in relation to that sum of money, and that information was:
 
”(i)  the particulars of the third party’s [that is Mr Mehmetcik] relationship with the defendants or any one of them and the reason why the third party is funding or providing the funds of the litigation; and
 
(ii)  the source of the fee sum [that is where the money has come from].”

36.  So dealing first with the £2.04 million, this was transferred, as is well known, on 22 July to the first defendant’s account in Cyprus. As to what was done with the £2.04 million, the first defendant said it was used for security protection and also the third defendant said that and said that last year in her second witness statement. The claimants seem to be saying that this must be rubbish, or in other words that it cannot be true that that sort of figure was spent on security. What they say is that the third defendant must at least know who was providing the security to them that they have had to spend so much money on. Who has been guarding her house? Who has been protecting her on her way to work? The claimants say that the third defendant should provide those details in order to comply with the second Jones order.
 
37.  I agree that it is odd that if so much money has been spent, over £2 million, that some more details in relation to that security cannot be provided, but it is necessary, it seems to me, to look at the terms of the order. The order required disclosure as to what had happened to the £2.04 million. The third defendant has said she does not know what has become of the £2.04 million, save that it was spent on security. Like the house in Cyprus, if all that the claimants are really after is the name of the security firm, why have they not asked for that specific information? They have known for a long time that that is what the defendants have been saying the money was spent on. They do not like the answer, they do not think it is right, but they could have asked for further details in relation to that, and it seems to me that, again, it is not appropriate for this to be the subject of an unless order with a threat of having their defences struck out as a result of not being able to provide that relatively simple information.
 
38.  In relation to the fee sum, the sum of £30,000, as I said, Mr Mehmetcik has been identified as the provider of those funds from quite an early stage. The defendants say that they do not know the source of his funds, and there may be an issue as to what actually “the source of the fee sum” in the second Jones order actually means. Do the defendants have to identify from where the third party obtained the funds provided to them? Or do they have to explain what steps have been taken by them to try to comply with the order? I understand what the claimants are trying to do. They are trying to test whether it can really be the case that Mr Mehmetcik was providing his own funds for the purposes of funding their defence of this litigation, or whether it was actually the case that the claimants’ funds have been recycled and have been paid to Mr Mehmetcik and then he has used those funds in order to fund their litigation. That is what is behind the application in this respect. That is what the claimants suspect, but is it appropriate that the third defendant should be obliged to go behind who she says is a good friend of theirs, to dig around and provide information about his provision of the funding?
 
39.  Indeed, the application in this respect has been considerably broadened out by reference to Mr Glover’s skeleton argument and to the new amended draft order. What he now seeks is not only that there should be an unless order in relation to the information about the source of the £30,000, but that if there has been non-compliance with that unless order, not only would the defence be struck out but also it appears that he wants there to be an order that Mr Mehmetcik should not be entitled to provide any further funds for the purpose of the defendants having funds to defend this claim. That seems to me to be an extraordinary extension to the order that they seek and if that was really something that they wish to pursue, it ought to have been the subject of a proper application notice and evidence in support.
 
40.  Mr Glover says that the need for this order has only arisen because of the late service of the third defendant’s witness statement this week, and that that witness statement’s failure to provide any useful information as to the source of the fee sum, but I do not think that that is a good enough reason for so broadening out what they seek, and indeed I do not think it is appropriate to make the unless order in any event.
 
41.  They also, on the back of this, seek to add a new form of order by varying the original Snowden order that required any third party providing funding to the defendants to give a written notice confirming that such funding does not originate in the claimants’ funds. That order was originally made, or adjusted, by Trower J on 14 June 2021 and he included in addition to the requirement to serve a notice confirming to the third parties’ knowledge and belief that the funds do not derive from the claimants’ funds, also a protection for the defendants’ solicitors, under (c) at para.3, that:
”Under this order, upon receipt of a notice, solicitors and counsel are under no obligation to enquire into whether sums transferred for the purposes of securing or paying legal fees or disbursements incurred in these proceedings may have come from assets derived from the transfers of $10 million and $4 million referred to in the definition of the fund in this order.”

42.  So that was a protection to the defendants’ solicitors, and I was concerned when I first saw that that it was sought to be got around by the proposed amendment to the order. However, Mr Glover says that no, that protection for the defendants’ solicitors will remain, but what he does seek is that there should be an addition to the requirement of confirming that the funds are not from the defendants’ funds, and the third party should provide, together with the notice:
”…sufficient financial information to the respondents’ solicitors to demonstrate that the provenance of funds is not any part of the fund or the first, second or third defendants’ assets.”

43.  It does seem to me that that is broadening extraordinarily the original scheme. It will require third parties to provide actual evidence of the source of their funds and if that sort of order is truly being applied for, then it needs to be applied for on proper notice and with proper evidence in support. I would not be prepared to amend the original order in those terms, effectively on the hoof, when there is no significant evidence that suggests that this is required or that this is an appropriate thing to do. Therefore I will not be making the unless order in relation to the fee sum, nor will I be varying the order to that effect.
 
44.  Turning finally to the Bacon order in relation to the third defendant, this concerns, as for the second defendant, the requirement to provide financial statements in relation to any bank or financial institution where the third defendant had a financial product, and also the correspondence. It seems to me that the bank statements have now been disclosed, albeit from other sources, but that that is all that needs to be provided and it would be inappropriate, the claimants having got those documents, including the one bank statement from the Barclays account that was not previously disclosed unfortunately, but they now have that information and it will be disproportionate to make any further order in that respect.
 
45.  The one area, however, where I think that the claimants do have a point is in relation to the correspondence. As I said above in relation to the second defendant, the fourth to sixth defendants, the third defendant’s children, have disclosed substantial communications within the family, and the third defendant now says that is basically all there is and she also said that she did not communicate electronically with her husband and so there is not any further communications within the family that have not been disclosed. However, the third defendant voluntarily signed up to the Bacon order that required disclosure of this material, and even though it does seem to me to perhaps cross the line into advance disclosure in the proceedings, it was done by way of a consent order, and the third defendant has not actually provided anything herself, and she certainly has not provided any communications between herself and her husband, nor has she described any process whereby she responded to this order by searching for those documents.
 
46.  I should say that Mr Glover showed me some examples in the disclosure from the fourth to sixth defendants that there was some communication, so it seemed, by email at least, between the first and the third defendants. It could just be that they happened to be copied into that correspondence and there is no other correspondence separately just between the two of them, but given the process has not been described, it seems to me that, albeit that I do not think an unless order is appropriate because the sanction is disproportionate, I am prepared to consider making a further order for compliance with the Bacon order, para.8, in the form of a disclosure affidavit that complies with Part 31, to cover the searches that have been made for such correspondence and whether that yields any such correspondence, so that the process that has been adopted by the third defendant in this respect can be made clear to the claimants.
 
47.  That is the only order that I am prepared to make on this application, and I hope that a suitable form of words can be agreed that will take account of what I have said.
 
LATER
 
48.  I am in the rather bizarre position of having the claimants asking for their costs of the application and the defendants also asking for their costs of the application. It seems to me that the defendants have been almost completely successful in their opposition to the application that has been made. The application was made last November for unless orders and I have expressed in my judgment some doubt as to whether that was the appropriate course to have been taken. Having said that, it has produced an affidavit or a witness statement, belatedly served on Tuesday morning of this week, and that, I suppose, could be seen as a modicum of success. They have got the third defendant to state in a witness statement and to finally provide some sort of response to the orders that were made some time ago. There is no doubt that there has been a substantial delay in providing the information that she was ordered to provide, or that both defendants were ordered to provide, many months ago.
 
49.  The witness statement had to be served. Mr Glover says that in fact it was served so late that the costs had already been incurred for this hearing, and it was only on the basis of that witness statement essentially that I found largely in the defendants’ favour and refused to make the unless orders. I am not sure that that is a particularly convincing argument, particularly as the effect of the third witness statement on the claimants was for them to double down on their determination to proceed with their application, and indeed they broadened it out, as explained in my judgment.
 
50.  The third witness statement had to be served in order for the defendants to succeed. It was very late. It is possible, it seems to me, that the claimants could have decided in the light of that not to proceed with this application but they decided to go ahead and they largely lost it. I think in the circumstances of this being an application that has basically succeeded because of the late service of a witness statement, that neither side could be said to be successful, or certainly not wholly successful, in relation to the overall conduct of the application, and the fairest order in the circumstances is that neither side should have their costs and that there should be no order for costs.

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