Save for an admitted breach, a committal application in long-running litigation has failed (Tonstate Group Limited and others v Edward Wojakovski)

14 Dec 2023

Dispute Resolution analysis: A committal application based on five allegations has succeeded in respect of only one, an allegation that had previously been admitted by the alleged contemnor. The matter now proceeds to a sanction hearing, albeit the severity of such sanction is likely to be substantially lessened by the failure of the application on the bulk of the allegations.

Tonstate Group Limited and others v Wojakovski [2023] EWHC 3119 (Ch)

What are the practical implications of this case?

This is an interesting case in relation to the difficulties faced by parties alleging contempt in the context of freezing injunctions, proprietary injunctions and orders for the disclosure of assets. It emphasises the importance of precision in such an application as regards the scope of the relevant orders in force against the alleged contemnor and the allegations that those orders have been breached. In circumstances in which one allegation has been admitted and the party is already prima facie guilty of contempt, there may be a temptation to assume that the contempt is widespread and to add in various additional allegations. Such a course of action may risk focusing with insufficient precision on the terms of the relevant orders and the extent to which the actions complained of breach those orders. As came to light in this case, merely being named as a beneficiary in a will does not mean that the person has a testamentary right to assets. Similarly, where a payment is made a short time prior to the relevant date for declaring assets, those funds will generally cease to be an asset of the party. This may remove any obligation to account for those funds in a statement of assets. It is important, finally, to distinguish actions which do not accord with the interests or expectations of a party who has obtained freezing and proprietary injunctions from contempt. The latter necessarily requires evidence that the alleged contemnor’s actions have actually breached the terms of the relevant orders.

What was the background?

The Claimant in this action alleges that the Defendant (“Mr Wojakovski”) is guilty of multiple and serious contempts of court by failing to comply with four court orders and knowingly making false statements in a witness statement and an affidavit and has brought a contempt application seeking the committal of Mr Wojakovski to prison. The application was originally to be heard on 20 July 2023. However, this hearing had to be adjourned when leading counsel for Mr Wojakovski informed the Court that she and junior counsel were obliged to withdraw from acting for him, albeit for reasons which could not be disclosed. The first allegation was that, in breach of a proprietary injunction granted on 16 January 2020, Mr Wojakovski extracted sums out of a bank account and spent it. The second allegation was that Mr Wojakovski had failed to give proper disclosure of his assets as had been ordered under that same order, specifically assets arising out of his late mother’s will. The third allegation was that he had failed to declare his interest in a sum of £50,000 deposited with a company, Intelligent Legal Solutions Limited. The fourth allegation was subdivided in the judgment. The first part to this allegation was that in breach of a freezing order, Mr Wojakovski had made payments to Raydens and Keidan Harrison from the £50,000 deposited with Intelligent Legal Solutions Limited. The second part to the allegation was that he had made knowingly false statements in witness statements about the source of the funds paid to Raydens and Keidan Harrison. The fifth allegation was that in breach of an order requiring Mr Wojakovski to explain the source of the funds paid to Raydens and Keidan Harrison he failed to disclose a bank statement which was in his possession and would have revealed the intermediate payment to Intelligent Legal Solutions Limited.

What did the court decide?

The first allegation was admitted by Mr Wojakovski and was held by the Court to constitute contempt. However, the Court concluded that none of the remaining allegations were proven to the requisite standard. In relation to the will, at the relevant date there was no evidence that Mr Wojakovski had actually inherited anything. He did not deny the existence of the will. He had simply set out his position that his entitlement was only discretionary. The Court did not find that this constituted a breach. The will did not itself reveal either a right or a sufficiently certain expectation of inheriting any particular asset. In any event, the will was governed by Israeli law and no expert evidence had been adduced in relation to the proper interpretation of the will in accordance with Israeli law. As regards the sum of £50,000, at the relevant date, the obligation on Mr Wojakovski had parted with the sum which was by then in the account of Intelligent Legal Solutions Limited. When he was under an obligation to disclose his assets, this sum was no longer an asset of his. Mr Wojakovski’s failure to declare that payment as an asset was not, therefore, a breach. It follows that the sum was not caught by the terms of the freezing order and, accordingly, no objection can be made to the use by these funds for Mr Wojakovski’s legal representation under the terms of the freezing order. It follows further that the statements in Mr Wojakovksi’s evidence about which the Claimants’ application was premised were not false. As a result of the findings made in relation to the £50,000 payment in other allegations, the bank statement with which the fifth allegation was concerned did not fall to be disclosed.

Case details

  • Court: Business and Property Courts of England and Wales, Business List
  • Judges: Mr Justice Edwin Johnson
  • Date of judgment: 5 December 2023

Article by Phillip Patterson – first published by LexisNexis


Phillip Patterson

Call: 2008


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