Miranda Investments Ltd & Ors v Dodi & Ors [2025] EWHC 3070 (Ch)

Mr Andrew Barns-Graham of Counsel¸(instructed by Brooke Law Group), for the 2nd and 4th Defendants.

Representation

• In this matter, the Claimant is represented by Mr Kamar Uddin of Counsel. The 1^st and 3^rd Defendants were represented by Mr David Mayall of Counsel. The 2^nd and 4^th Defendants were represented by Mr Andrew Barns-Graham of Counsel.

The Application

• The application before me is dated 21^st February 2025. It is brought by all four Defendants against the Claimant and it seeks:

“An Order requesting that the Claimants’ Statement of Case be struck out in its entirety pursuant to CPR 3.4 (2). Alternatively, that part of the Particulars of Claim be struck out pursuant to CPR 3.4 (2). Further and/or in the further alternative that the Court grant summary judgement against the Claimants on the entirety of their claim pursuant to CPR 24.2 (a). Further and/or in the further alternative that the Court grant summary judgement against the Claimants on part of the Particulars of Claim pursuant to CPR 24.2 (a).”

The legal tests

• The requirements for striking out are set out in CPR 3.4(2), and the parties did not elucidate its terms significantly. The test for Summary Judgement is familiar to the Court. The Defendants Counsel’s joint Skeleton argument helpfully set out passages from the judgment of Lewison J (as he then was) in easyair Ltd v Opal Telecom Ltd [2009] EWHC 339 (Ch) at [15] and a further paragraph from On the Beach Ltd v Ryannair [2023] EWHC 2694 (Comm). Mr Uddin relied on similar authorities.

The Scheme

• This application arises in the context of claim arising out of a scheme to purchase and develop a property known as 36C Harrington gardens, which I shall call, the “Property”. The scheme was to purchase a long lease of the Property, redevelop it and sell it at a significant profit. The purchase and development were to be carried out using a single purpose vehicle company called 36C Harrington gardens Ltd, which I shall refer to as, “the Company”. Sadly, in the event, the scheme was not a success. The Company first went into administration and then went into voluntary liquidation. I was told that the Company’s creditors were given a dividend of 30p in the pound and there is no prosect of any return to shareholders.

The Parties

• The Claimants are persons who invested in the Company by means of crowdfunding. The 1st and 2nd Defendants are the individuals behind the scheme. The 3^rd and 4th Defendants are the 1^st and 2^nd Defendants’ respective companies.

Background

• On 16^th December 2016, a long lease of the Property was acquired by the Third Defendant, (“ORD”) for £2,050,000. ORD was a company, of which the First Defendant was a Director and he owned its entire share capital. It is common ground that the long lease was held by ORD on bare trust for the Company. After the purchase of the long lease, there also had to be a purchase of an extension to the lease and a long lease of a balcony. When the property was sold, the proceeds of sale were paid to the Company’s mortgagees, with the balance paid to the Company.

• When the Claimants became involved, they were provided with a brochure which was referred to as the “Investment Prospectus”. This was updated with a second Investment Prospectus. Each Investment Prospectus, (“IP”), was a brochure giving details of the scheme. It included a worked example of the possible return on investment and attractive pictures of the proposed development and layout plans.

• The core contractual document for the scheme was in the form of a Deed dated 10^th February 2017. It was made between the Company and the 3^rd and 4^th Defendants. At the hearing, it was referred to as the “Shareholders’ Agreement”. I shall refer to it as the “SA”. The SA contained provisions about the implementation of the scheme by the parties. The way in which the Claimants joined the scheme was curious. They were each invited to, and did, sign a Deed of Adherence, (“the DA”). The DA was set out as Schedule 6 to the SA. Under clause 1.1 of the SA, (the clause which set out the words defined in the SA), the Claimants, by signing the DA, were brought within the definition of “Parties” and were stated to become bound by the SA.

• The Claimants became shareholders in the Company. They acquired shares, at £500 a share, up to the value of their respective contributions.

• The Fourth Schedule to the SA was headed “Capital Investment in the Company”. Under this, there was sub-heading “Initial Contributions” and then a list, as follows:-

“The Investors: £732,000

ORD: £1,000,000

RTR: £1,000,000

Total: £2,732,000

• The “Investors” were those who invested in the scheme by crowdfunding. Of that total, the Claimants contributed some £411,000. “ORD” is the 3^rd Defendant and “RTR” is the 4^th Defendant.

Continue reading this Judgment here.