<center><span class="news-text_italic-underline">Date: 22 May 2024</span></center>
Summary
The judge correctly found the former banker guilty of serious and deliberate breaches of disclosure obligations under a freezing injunction, resulting in his 12-month prison sentence for contempt. While the decision to impose immediate imprisonment was not erroneous, the court exercised mercy by suspending the sentence, giving the contemnor a final opportunity to comply with his disclosure duties, despite being unrepresented.
Abstract
A former banker (“<span class="news-text_medium">T</span>”) appealed against his imprisonment for failing to comply with the disclosure obligations under a freezing injunction. The case arose from proceedings initiated by the respondent (“<span class="news-text_medium">N</span>”), who claimed that T had wrongfully misdirected her assets to entities in which he had an interest. N obtained a freezing order with a proprietary injunction and related disclosure requirements. T admitted to not fully complying with the order but argued that his non-compliance was unintentional, citing his ADHD and claiming a lack of understanding of the order. Despite these claims, the judge found T guilty of deliberate breaches and sentenced him to 12 months in custody.
Held
Appeal allowed in part.
- <span class="news-text_medium">Was the trial unfair?</span> T argued that his ADHD impacted his understanding of the order and fairness of the trial. However, the judge had ensured an intermediary was available to assist and no issues were raised during the trial. The court found that it was legitimate to assess T's capacity based on the available evidence, concluding that the trial process was fair.
- <span class="news-text_medium">Was a breach of the order enough to constitute contempt?</span> T argued that breach alone should not equate to contempt, especially in the case of unintentional omissions. However, the judge found that the breaches were deliberate and T had made no efforts to comply with the order, justifying contempt.
- <span class="news-text_medium">Were the breaches deliberate?</span> The judge clarified that T’s non-compliance was not due to a lack of ability to comply, but rather due to his deliberate failure to do so, thus justifying the finding of contempt.
- <span class="news-text_medium">T’s liability as a company director.</span> T was also a director of several companies involved in the application. The court reaffirmed that a director is personally responsible for ensuring compliance with court orders, even if the breach is by the company. The principle that directors can be held liable for company breaches was upheld.
- <span class="news-text_medium">Adjournment of sanctions hearing.</span> T argued that the sanctions hearing should have been delayed until the underlying case was resolved. The judge found that delaying sanctions would deny N the benefit of the disclosure obligations, particularly given T’s continued non-compliance. Thus, the judge proceeded with the sanctions hearing.
- <span class="news-text_medium">Was the judge wrong to impose the sanction?</span> While the sentence was appropriate, the court decided to suspend it on the grounds of mercy rather than justice. T had already been in custody for approximately three weeks and was unrepresented, which posed challenges for his defense. The suspension gave him one last opportunity to fulfill his disclosure obligations. If T failed to comply within three months, the sentence could be activated.
