Liability of trustee after assignment

Hunt v Harb and Anor [2011] EWCA Civ 1239, 27 October 2011

The first defendant claimed to have married HRH the late the King of Saudi Arabia in secret in 1968. In May 2003, several years after they had separated, her solicitors sent a draft statement to the King, setting out the basis of a claim which she was bringing against him under s27 of the Matrimonial Causes Act 1973. She claimed to have subsequently met the King’s son, the second defendant (the Prince), and to have withdrawn the claim pursuant to an agreement with which the Prince did not in the event comply. In April 2008, the first defendant became bankrupt on her own petition. Upon her bankruptcy, the claim vested in her trustee in bankruptcy (the claimant). The six-year limitation period for bringing a claim against the Prince would have expired in June 2009. In that month, the claimant issued the claim against the Prince (the claim), which was served on him outside the jurisdiction. The claimant was unable to obtain after-the-event (ATE) insurance and was unable to find third party funding. Consequently, he discontinued the claim. The first defendant applied successfully to set aside the notice of discontinuance, joining the claimant and the Prince. Directions were given ordering that the proceedings relating to the claim should be adjourned for a reasonable period while the claimant invited offers for the claim, but that if no such offers were received then he could serve a fresh notice of discontinuance. The order allowed for the claimant to reject any offer on terms that all or any part of the net proceeds of a successful claim would be paid to him or applied for the benefit of the creditors on the grounds that the purchaser would, in pursuing the claim after sale, be acting as the mere nominee or delegate of the claimant who would accordingly continue to be at risk of liability for costs. The first defendant appealed against that part of the order.