CANDEY court of appeal win against KPMG
London litigation boutique CANDEY secured a third substantial victory against liquidators at KPMG in a Court of Appeal judgment handed down on 16 October 2018 [Crumpler & Bower v CANDEY [2018] EWCA Civ 2256].
CANDEY acted for Peak Hotels and Resorts Limited (Peak) in complex litigation in London, the BVI, New York and Hong Kong in respect of the $368 million shareholder dispute over the ownership of Aman Hotels, the uber luxury hotel group favoured by billionaires (a case described as “a takeover battle the likes of which the luxury hotel-industry has never seen” and as featured in The Lawyer ‘Top 20 Cases of 2015’). The London litigation alone involved 8 High Court Judges. As Peak’s cash began to run out CANDEY agreed to cease charging hourly rates and instead agreed a fixed fee of £3.8 million to help Peak finance the litigation to the end of the proceedings. 8 weeks before trial, Peak entered liquidation. The liquidators instructed CANDEY to continue to represent them, but only 3 weeks later sacked them, minutes after having secured a substantial multi-million dollar settlement.
CANDEY had by this time incurred £1.2 million of notional hourly rates but was able to claim as a secured creditor for the full amount of the fixed fee. The liquidators challenged the security which comprised chiefly of monies paid into Court. The liquidators argued that where monies had been paid into Court, by way of security for costs and fortification of a cross undertaking in damages, the paying party loses all right in the monies. CANDEY disagreed. They contended that the paying party retains an interest in the monies, a right to demand its return on success, and that right was capable of being charged.
In June 2017 His Honour Judge Davis-White QC found in favour of CANDEY holding that it had a floating charge over the $12 million in funds paid into court and a further $1.5 million recovered from Standard Chartered Bank [Crumpler & Bower v CANDEY [2017] EWHC 1511 (Ch) www.bailii.org/ew/cases/EWHC/Ch/2017/1511.html]. At a further hearing in November 2017 His Honour Judge Raeside QC valued CANDEY’s services at the contractual price of £3.8 million plus interest.
KPMG appealed against both decisions. The appeal against the decision of HHJ Davis-White QC was today unanimously rejected by the Court of Appeal. Sir Colin Rimer, who delivered the judgment, said:
“In my judgment, the current of .. authority flows firmly in favour of CANDEY and against the liquidators: namely that the payer of money into court by way of providing security…retains its property in the money… subject to the security interest…I would also regard such current as flowing in the correct direction”.
[2018] EWCA 2256 (Civ).
