Case No: A3/2014/0700

Neutral Citation Number: [2014] EWCA Civ 1511

IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
MRS JUSTICE ROSE
HC13F00948
Royal Courts of Justice
Strand, London, WC2A 2LL
Date: 25/11/2014
Before :
LORD JUSTICE JACKSON
LORD JUSTICE LEWISON
and
LORD JUSTICE TREACY
--------------------Between :
(1) INPLAYER LIMITED (FORMERLY INVIDEOUS
LIMITED)
(2) INVIDEOUS DOOEL-SKOPJE
(3) PIERRE ANDURAND
- and JACK THOROGOOD

Claimants/
Respondents

Defendant/
Appellant

----------------------------------------Mr Julian Milford (instructed by Lewis Silkin) for the Respondents

Mr Adam Tear (instructed by Duncan Lewis) for the Appellant
Hearing date: 21st October 2014
---------------------

Judgment

Lord Justice Jackson:

1.

This judgment is in six parts:

Part 1. Introduction

Paragraphs 1 to 7

Part 2. The facts

Paragraphs 8 to 16

Part 3. The present proceedings

Paragraphs 17 to 31

Part 4. The appeal to the Court of Appeal

Paragraphs 32 to 51

Part 5. The appellants skeleton argument

Paragraphs 52 to 57

Part 6. Executive summary

Paragraphs 58 to 62
Part 1. Introduction

2.

This is an appeal against a decision that the first defendant in a chancery action is
guilty of two contempts of court by reason of untruthful statements in his affidavit.
The main issue is whether the judges findings of contempt can stand despite a
number of procedural irregularities which are now admitted.

3.

The claimants in the action and the respondents to this appeal are (1) Invideous Ltd
(Invideous), (2) Invideous Dooel-Skopje (IDS) and (3) Pierre Andurand (Mr
Andurand). Invideous Ltd changed its name to Inplayer Ltd on 2 nd October 2014. I
shall continue to refer to that company by its original name.

4.

The defendants in the action are (1) Jack Thorogood (Mr Thorogood), (2) NOVP
Dooel-Skopje (NDS), (3) Igor Micov (Mr Micov), (4) NOVP Ltd (NOVP) and
(5) NOVP LLC (NL). Mr Thorogood is the only defendant alleged to have been in
contempt. He alone is appellant in this court.

5.

Other companies who will feature in the narrative are Dolphin Television Ltd
(Dolphin) and Technicolor Media Services Limited (Technicolor).

6.

I shall refer to the European Convention on Human Rights as ECHR. The ECHR
article 6 provides:
Right to a fair trial
1. In the determination of his civil rights and obligations or of
any criminal charge against him, everyone is entitled to a fair

and public hearing within a reasonable time by an independent

and impartial tribunal established by law.

3. Everyone charged with a criminal offence has the following

minimum rights:
(a) to be informed promptly, in a language which he
understands and in detail, of the nature and cause of the
accusation against him;
(b) to have adequate time and facilities for the preparation
of his defence;
(c) to defend himself in person or through legal assistance
of his own choosing or, if he has not sufficient means to
pay for legal assistance, to be given it free when the
interests of justice so require;
7.

After these introductory remarks I must now turn to the facts.

Part 2. The facts

8.

Invideous Ltd (Invideous) was incorporated on 1st July 2010. The business of
Invideous was concerned with monetising video content on the internet. The nature
of that business is more fully described in paragraphs 8 to 12 of the judgment below,
but the details are not relevant to the present appeal.

9.

Invideous had a wholly owned subsidiary company, Invideous Dooel-Skopje (IDS),

which was incorporated in Macedonia. IDS employed the technical people who
designed and developed the products which Invideous marketed in the UK. Mr Igor
Micov was the manager of IDS in Macedonia.

10.

There were four principal shareholders of Invideous namely Mr Jack Thorogood, Mr

David Goffin, Mr John Doyle and Mr Michael Wells. Mr Thorogood, Mr Goffin and
Mr Wells were directors of the company.

11.

Mr Thorogood was the active director of Invideous, who worked full time for the
company and oversaw its operations. The other directors and shareholders provided
financial backing through the medium of a company which they controlled called
Dolphin Television Ltd (Dolphin). Between July 2010 and June 2011 Dolphin
made interest free loans totalling 467,000 to Invideous.

12.

In June 2011 a potential investor, Pierre Andurand, came onto the scene. Nicolas
Granatino, an associate of Mr Andurand, approached Mr Thorogood. He said that Mr
Andurand was willing to invest 900,000 in the business. A period of discussion and
negotiations then followed.

13.

On 22nd November 2011 Mr Thorogood entered into a written service agreement with
Invideous, setting out his obligations as director. Mr Thorogood was also appointed
manager of IDS. In December 2011 Mr Andurand invested the promised 900,000 in

Invideous. On 8th December 2011 Mr Doyle, Mr Goffin, Mr Wells, Mr Andurand, Mr

Thorogood and Invideous entered into a shareholders agreement. Under that
agreement Mr Goffin and Mr Andurand each held 30% of the shares of Invideous. Mr
Thorogood held 11.65 %.
14.

During 2012, unknown to the other directors and shareholders, Mr Thorogood and Mr
Micov set up another business operating in the same field as Invideous. Mr
Thorogood established three companies to run the new business. They were NOVP
Ltd (NOVP), a UK company, NOVP Dooel-Skopje (NDS), a company
incorporated in Macedonia, and NOVP LLC (NL), a company incorporated in
Delaware, USA. Mr Micov became the manager of NDS. I shall refer to the new
business operation which Mr Thorogood and Mr Micov set up as the NOVP
business.

15.

In February 2003 there was a falling out between Mr Thorogood and his colleagues in
Invideous. On 25th February 2013 Mr Thorogood resigned as a director of Invideous.
On 28th February 2013 he resigned as director of IDS.

16.

At about the same time the other directors of Invideous discovered about the NOVP
business which Mr Thorogood had been operating since 2012. They took the view
that this was a serious breach of his duties as director and under the shareholders
agreement. Accordingly they commenced the present proceedings.
Part 3. The present proceedings

17.

On 1st March 2013 Invideous, IDS and Mr Andurand made a without notice
application for an injunction. The matter came before Mr Justice Mitting, who
granted an interim injunction restraining Mr Thorogood from competing with the
claimants and requiring him to deliver up all material belonging to the claimants.

18.

On 8th March 2013 the claimants issued a claim form in the Chancery Division of the
High Court, naming Mr Thorogood as first defendant, NDS as second defendant and
Mr Micov as third defendant. Shortly afterwards they joined NOVP as the fourth
defendant and NL as fifth defendant.

19.

The return date for the interim injunction was 8th March 2013. There seems to have
been a short delay. The next hearing took place on 11th March. On that occasion the
court made an order by consent continuing the injunction until trial or further order.
This order plays a crucial role in the present appeal. I shall refer to it as the consent
order. Paragraph 8 of the consent order provided:
The First Defendant do within 7 (seven) days of the date of
this order provide and swear an Affidavit detailing each and
every breach by him of the Shareholders Agreement,
including:
a. Details of discussions or correspondence (in any form) that
the First Defendant (or anyone acting on his instructions or on
his behalf) has had with each employee of the First and/or
Second Claimants in the preceding 6 months in connection
either with the termination of their employment with the First

and/or Second Claimants or any offer of employment with the

Second Defendant;
b. Details of any discussions or correspondence (in any form)
that the First Defendant (or anyone acting on his instructions or
on his behalf) has had with any client or partner of the First
and/or Second Claimants in connection either with the
termination of the provision of services to that client or partner
by the First and/or Second Claimants, or in connection with the
transfer (or possible transfer) of that client or partners business
to the Second Defendant or any other business (including, for
the avoidance of doubt, any attempt by the First Defendant (or
anyone acting on his instructions or on his behalf) to solicit or
entice the client or partner to do business with someone other
than the First and/or Second Claimants (whether that attempt
was successful or not).

20.

On 15th March 2013 Mr Thorogood filed an affidavit, as required by paragraph 8 of

the consent order. In paragraph 10 he stated:
NOVP did not begin trading until November 2012. Until very
recently, it has had only one client, and that client is not a client
of IL or ID (nor has it ever had any connection with IL or ID).
It is common ground that the client to whom Mr Thorogood was referring in that
paragraph was Technicolor.

21.

In paragraph 14 of his affidavit Mr Thorogood stated that he had terminated the

employment of numerous employees of IDS in or around February 2013. He gave the
names of those employees and summarised the conversations which he had had with
each person.

22.

On 28th March 2013 Mr Justice Sales made an order reformulating the existing
injunction, so as to clarify what Mr Thorogood was prohibited from doing. Paragraph
15 of Mr Justice Sales order stated that a business would be in competition with
Invideous if it involved:
The provision to clients of online video platforms and/or
online video platform services, including, in the context of
provision of such platforms, and/or services, online pay-perview, online advertising software, monetization solutions,
online storage, transcoding, embeddable players, bandwidth,
custom app creation, 3rd party OVP integrations, API or multichannel publishing.

23.

The claimants took the view that Mr Thorogood was not complying with any of the
orders made by the court. Accordingly on 24 th April 2013 they applied to commit him
to prison for contempt of court.

24.

The contempt application came on for hearing before Mr Justice Vos on 13 th June
2013. There was insufficient time to deal with the matter on that occasion. Mr
Justice Vos ordered that the committal application be adjourned to be heard at the
same time as the trial of the action.

25.

On 15th July 2013 the claimants amended their application to commit. They asserted
that Mr Thorogood had committed two separate contempts, namely carrying on a
competing business and failing to take reasonable steps to ensure that the other
defendants complied with the courts orders.

26.

Both the hearing of the committal application and the trial of the action commenced
before Mrs Justice Rose (the judge) on 6th September 2013. The claimants were
represented by counsel. Mr Thorogood appeared in person. The other defendants did
not appear and were not represented. The trial lasted for nine days. Mr Granatino, Mr
Goffin and an expert witness, Mr Jezequel, gave evidence for the claimants. Mr
Thorogood gave evidence in his own defence.

27.

The judge handed down her reserved judgment on 11th October 2013. In relation to
the substantive issues tried, she held that Mr Thorogood was in breach of his
contractual and fiduciary duties in the following respects:

28.

i)

setting up and working for NDS;

ii)

pursuing a prospective deal with Technicolor on behalf of NDS rather than

Invideous;

iii)

pursuing business opportunities with a company known as Nexeven on behalf

of NDS, rather than Invideous;

iv)

dismissing or arranging the dismissal of employees of IDS in October 2012, so

that they could be re-employed by NDS.

In relation to the committal application, the judge rejected all the allegations of
contempt which had been advanced by the claimants in their application. Instead of
dismissing the contempt application the judge went on to consider two further
instances of contempt, which she found proved. These were:
i)

paragraph 10 of Mr Thorogoods affidavit sworn on 15 th March 2013 was

untruthful and a deliberate act of disobedience to the consent order.

ii)

paragraph 14 of Mr Thorogoods affidavit sworn on 15 th March 2013 was

deliberately untrue and misleading. It omitted the names of ten members of
staff whom Mr Micov had dismissed from the employment of IDS and reemployed on behalf of NDS during October and December 2012. Mr Micov
had done this on the instructions of Mr Thorogood. Mr Thorogood was
thereby in breach of the consent order.

29.

On 28th November 2013 the judge granted retrospective permission for the claimants
to re-amend their committal application so as to include the contempts which she had
found proved. Mr Thorogood then prepared a witness statement for the sentencing
hearing.

30.

On 18th February 2014 the judge heard submissions in relation to sentence. She then
delivered a further judgment in which she sentenced Mr Thorogood to 42 days
imprisonment for the first contempt and 28 days imprisonment for the second
contempt. She directed that the prison sentences should run concurrently. Very
wisely the judge granted bail pending appeal.

31.

Mr Thorogood is aggrieved by the two findings of contempt. Accordingly he has

appealed to the Court of Appeal.
Part 4. The appeal to the Court of Appeal

32.

By a notice of appeal dated 3rd March 2014, Mr Thorogood appealed to the Court of
Appeal against the committal order. He asserted that the judges decisions were
demonstrably wrong and that there were serious procedural mistakes and other
irregularities in the proceedings.

33.

Shortly after commencing his appeal Mr Thorogood obtained legal aid. Accordingly
both sides have been represented in the Court of Appeal.

34.

It is not easy to isolate the real issues in this appeal from the lengthy and noncompliant skeleton argument prepared by Mr Adam Tear, who represents Mr
Thorogood. At the start of the appeal therefore the court in discussion with Mr Tear
identified his four essential complaints. They are:

35.

i)

The allegations of contempt were not formulated or notified to Mr Thorogood

until after the hearing at which the judge found these instances of contempt to
be proved.

ii)

Because the trial and the committal hearing took place at the same time Mr
Thorogood was effectively compelled to give evidence.

iii)

Mr Thorogood was unrepresented, because no-one told him of the availability

of legal aid in contempt proceedings.

iv)

The claimants did not obtain permission to make a committal application in

accordance with CPR rules 81.12 and 81.14.

I shall refer to these four complaints as grounds (i), (ii), (iii) and (iv).

Ground (i)
36.

Mr Julian Milford for the claimants (who did not appear below) concedes that there
has been a breach of article 6.3 (a) of the ECHR. Mr Thorogood was not told of the
allegations against him until after being found guilty.

37.

Mr Milford was right to make that concession. I would add that it is also a principle
of common law which predates the Human Rights Act 1998 that every accused person
is entitled to be informed of the charges which he faces.

38.

Mr Milford submits that despite the procedural irregularity the judges decision
should stand. The case against Mr Thorogood on both contempts was very strong.
Furthermore he had and took the opportunity to put forward his substantive defence in
respect of paragraphs 10 and 14 of his affidavit during the sentencing hearing.

39.

I am afraid this will not do. A judge hearing a committal application should confine
himself or herself to the contempts which are alleged in the application notice. If the
judge considers that other alleged contempts require consideration, the correct course
is to invite amendment of the application notice and then provide any necessary
adjournment so that the respondent can prepare to deal with those new matters. I
therefore uphold the first ground of appeal.

Ground (ii)
40.

A person accused of contempt, like the defendant in a criminal trial, has the right to
remain silent: see Comet Products UK Ltd v Hawkex Plastics Ltd [1971] 2 QB 67. It
is the duty of the court to ensure that the accused person is made aware of that right
and also of the risk that adverse inferences may be drawn from his silence.

41.

If the committal application is heard at the same time as other issues about which the
alleged contemnor needs to give evidence, he is placed in the position where he is
effectively deprived of the right of silence. That is a serious procedural error: see
Hammerton v Hammerton [2007] EWCA Civ 248. This is precisely what happened in
the present case. Furthermore no-one told Mr Thorogood that an alleged contemnor
has the right not to give evidence.

42.

If the contempt application had been the subject of a separate hearing and Mr
Thorogood had been informed of his right not to give evidence, he might have
exercised that right. He could then have dealt with the contempt allegations by way
of submissions. In that regard it should be noted that the judge based her two findings
of contempt upon answers which Mr Thorogood had given under skilful crossexamination.

43.

Mr Milford points out that Mr Thorogood was reminded of his right not to incriminate
himself. That is true, but it is not sufficient. Mr Thorogood should have been told
that he was not obliged to give evidence. Furthermore the litigation should not have
been managed in a way that forced Mr Thorogood into the witness box.

44.

Mr Milford submits that even if there had been a separate hearing of the contempt
application, the result would have been the same. If Mr Thorogood gave evidence, he
would have been caught out in cross-examination. If he had declined to give
evidence, the court would have drawn adverse inferences.

45.

What Mr Milford says may well be true. Indeed, as things have turned out, Mr
Thorogood may be a very lucky man. Nevertheless there can be no question of
upholding findings of contempt against a person who has been deprived of valuable
safeguards in the circumstances of this case.

46.

I therefore uphold the second ground of appeal.

Ground (iii)
47.

A committal application has the character of criminal proceedings. The alleged

contemnor is therefore entitled to legal aid, so that he can be properly represented: see
Kings Lynn v West Norfolk Council v Bunning (Legal Aid Agency, interested party)
[2013] EWHC 3390 (QB); [2014] 2 All ER 1095.

48.

Unfortunately no-one told Mr Thorogood of his right to legal aid during the first
instance proceedings. Mr Thorogood subsequently learnt of his entitlement, with the
result that he now has legal aid and is represented in this court.

49.

Mr Milford accepts that the hearing below proceeded without anyone telling Mr
Thorogood of his right to legal aid in relation to the contempt application. Mr Milford
also accepts that Mr Thorogood should have been told of his entitlement and then
given an opportunity to instruct lawyers of his choice. Therefore there has been a
breach of common law principles of fairness and ECHR article 6.3 (c).

50.

I therefore uphold the third ground of appeal.

51.

In the result the judges findings of contempt cannot stand. It is not necessary to deal
with the fourth ground of appeal, on which we have not heard full argument.
Part 5. The appellants skeleton argument

52.

I have protested previously about the poor quality and excessive length of some
skeleton arguments in this court. On occasion the Court of Appeal has deprived
successful parties of the costs of preparing their skeletons. So far, unfortunately, this
message has failed to reach the profession. Mild rebukes to counsel and gentle
comments in judgments have no effect whatsoever. Therefore, with regret, I must
speak more bluntly.

53.

The rules governing skeleton arguments for the Court of Appeal are contained in
paragraph 5 of Practice Direction 52A and paragraph 31 of Practice Direction 52C.
(Paragraph 32 deals with supplementary skeleton arguments.) These rules do not
exist for the benefit of judges or lawyers. They exist for the benefit of litigants,
namely (a) to ensure that their contentions are presented most effectively to the court
and (b) to enable the court to deal with its caseload expeditiously, bearing in mind that
there is always a queue of appellants and respondents waiting for their matters to be
heard.

54.

In essence an appellants skeleton should provide a concise, user friendly introduction

for the benefit of the three judges who will probably have had no previous
involvement in the case. The skeleton should then set out the points to be argued
clearly and concisely, with cross-references to relevant documents and authorities, in
the manner prescribed by Practice Direction 52A paragraph 5. The skeleton should
not normally exceed 25 pages. Usually it will be much shorter. In a straightforward
case like this the skeleton argument would, or at least should, be much less than 25
pages.

55.

As anyone who has drafted skeleton arguments knows, the task is not rocket science.
It just requires a few minutes clear thought and planning before you start. A good
skeleton argument (of which we receive many) is a real help to judges when they are
pre-reading the (usually voluminous) bundles. A bad skeleton argument simply adds
to the paper jungle through which judges must hack their way in an effort to identify
the issues and the competing arguments. A good skeleton argument is a real aid to the
court during and after the hearing. A bad skeleton argument may be so unhelpful that
the court simply proceeds on the basis of the grounds of appeal and whatever counsel
says on the day.

56.

The appellants skeleton argument in this case does not comply with the rules. It is 35
pages of rambling prolixity through which the reader must struggle to track down the
relevant facts, issues and arguments.

57.

Although the successful appellant in this case is entitled to his costs, he will not
recover the costs of the skeleton argument against the respondents to the appeal.
Part 6. Executive summary

58.

The claimants applied to commit Mr Thorogood, the first defendant, to prison for
contempt of court. The contempt application was heard at the same time as the trial of
the action. Mr Thorogood was unrepresented at the hearing.

59.

The judge rejected the allegations of contempt which the claimants advanced, but
found two other contempts proved. She sentenced Mr Thorogood to a total of six
weeks imprisonment, stayed pending appeal.

60.

In my view the judges decision cannot stand for three reasons:

i)

Mr Thorogood was not informed at any time before judgment of the two
alleged contempts which the judge found proved.

ii)

Mr Thorogood was not informed of his right not to give evidence. Being
unrepresented he would not know of that right. The litigation was so managed
that Mr Thorogood had no choice but to give evidence.

iii)

Mr Thorogood was not informed of his entitlement to legal aid. As a result he

was unrepresented when facing the equivalent of a criminal charge.

61.

The appellants skeleton argument does not comply with the rules. Therefore the
appellant will not recover the costs of his skeleton argument against the respondents.

62.

If my Lords agree, this appeal will be allowed and the findings of contempt will be
quashed.

Lord Justice Lewison:

63.

I agree and I specifically endorse paragraphs [52] to [57] of Jackson LJs judgment.

Lord Justice Treacy:

64.

I agree with both judgments.