Saul Lemer instructed by Quinn Emanuel, acted for the Second Defendant – John Deuss – in successfully defeating a claim brought by the liquidators of Transworld Payment Solutions against him and the Bank (TWPS) following a significant trial heard by Leech J between March-May this year.
Mr Deuss, the owner of a Curacao bank, First Curacao International Bank (FCIB), was accused of dishonestly seeking to procure the business of traders engaged in MTIC fraud practised on HMRC and dishonestly causing a UK based marketing entity (Transworld) to assist in procuring that business. The Claimants sought over £280m from Mr Deuss. Leech J dismissed these allegations entirely.
The Judge made a number of important findings in his 430-page judgment:
- He rejected the core allegation of dishonesty against Mr Deuss.
- He found that the Claimants had failed to make out their case on large parts of the quantum claimed. He was critical of the failure to call expert evidence to explain and justify the quantum.
- He rejected the Claimants’ case that the Liquidators’ decision not to take a limitation defence in respect of claims against Transworld’s estate meant that Mr Deuss was not able to rely on limitations and held that large parts of the claim were time-barred, rejecting the Claimants’ reliance on section 32 of the Limitation Act. He held that a reasonably diligent liquidator would, by 2007, have had sufficient information to plead a fraud claim against the Defendants.
- He also held that the General Rolling Stock principle (that a limitation period ceases to run against a company in liquidation) has no application to companies in a foreign insolvency process. He also rejected the Claimants’ argument that provisions of the Limitation Act could be disapplied by virtue of the principle of modified universalism.
- He held that the Claimants had failed to make out their case that Mr Deuss was a de facto or shadow director of TWPS. The allegation that Mr Deuss was a shadow director was not properly pleaded and the allegation that he was a de facto director was not supported by the evidence.
- He held that the claims would, in any event, have been barred by the Curacao law principle of forfeiture of rights. He held that, given settlement agreements entered into in Curacao and the negotiations around them, the Claimants were acting in a manner which could not be reconciled according to standards of reasonableness and fairness in bringing the claims.