On 31 July 2026, in Xenfin v GFG [2026] EWHC 2158 (Ch), the Chancery Division dismissed an application by the First Defendant, GFG, to strike out the Claimant’s claim and/or for reverse summary judgment. Mr Justice Michael Green also granted the Claimant permission to amend its pleadings. The claim will now proceed to a 16-day trial listed for March 2027.
The Claimant is a Guernsey company in liquidation. It brings claims against its directors and investment manager arising from loans of approximately £13 million made in connection with the Dolphin Group, which subsequently collapsed. In January 2025, the Claimant successfully resisted jurisdiction challenges brought by the Defendants: Xenfin v GFG [2025] EWHC 172 (Ch).
GFG’s strike-out application was advanced on three broad grounds.
First, GFG contended that the Claimant had failed adequately to plead the alleged investment management agreement between the parties and that the claim had no real prospect of success. Michael Green J rejected both arguments. The Court held that the Claimant had adequately pleaded its case that GFG had been appointed as its investment manager under an unwritten agreement. It would be “completely disproportionate” to strike out the claim, particularly where GFG had defended it on the merits for more than two years without seeking further particulars.
The Court also refused reverse summary judgment, holding that the Claimant’s case had a real prospect of success. The contemporaneous documents were capable of supporting the existence of an investment management agreement between the Claimant and GFG, and disclosure and witness evidence could reasonably be expected to shed further light on the parties’ arrangements.
Second, GFG argued, relying on Nomura International Plc v Granada Group Ltd [2007] EWHC 642 (Comm), that the proceedings had been issued before the Claimant was in a position properly to formulate its claim and were therefore an abuse of process. The Judge rejected that argument, describing as “outlandish” the suggestion that a properly formulated claim which should proceed to trial should nevertheless be struck out because of what the Claimant did or did not know when proceedings were issued. The Court also regarded GFG’s delay in raising the alleged abuse, having defended the proceedings on their merits, as significant.
Third, GFG argued that the proceedings were an abuse because the Claimant’s liquidator had previously also acted as liquidator of GFG. The Court rejected that ground, holding that it “gets nowhere near establishing an abuse of process”. Any issues resulting from the liquidator’s historic position could be addressed through the disclosure process; striking out the claim on that basis would be “frankly, absurd”.
The Court also allowed the Claimant’s amendment application. It held that the proposed amendment did not introduce a new cause of action, but advanced an alternative case as to the terms of the same alleged unwritten investment management agreement. The issue will be determined at trial following disclosure and witness evidence.
Alexander Brown KC appeared for the Claimant, instructed by Stewarts Law LLP.