The Jamaican Redevelopment Foundation was the assignee of loans made to Mr Winston Finzi personally and to companies that he controlled and for which he had given personal guarantees. These became the subject matter of various sets of proceedings that resulted in judgments against Mr Finzi and others but ultimately also in a settlement agreement of 28 August 2012 intended to bring the litigation to an end.
Notwithstanding the settlement, Mr Finzi later instigated proceedings with a view to reversing the earlier judgments and settlement on the basis that they had all been obtained by fraud. The first instance judge in Jamaica granted the defendants summary judgment, dismissing Mr Finzi’s claim as an abuse of process; the Court of Appeal refused permission to appeal from that decision. Mr Finzi was, however, granted leave to appeal to the Privy Council against the order refusing him permission to appeal to the Court of Appeal.
Mr Finzi contended before the Privy Council that the courts below had erred in finding that failure on his part to exercise reasonable diligence in uncovering and alleging the fraud now relied on rendered his claim an abuse of process. He argued that the decision of the United Kingdom Supreme Court in Takhar v Gracefield Developments Ltd, handed down after the Court of Appeal had heard his application for permission to appeal, showed that there was no such requirement at common law. Mr Finzi’s appeal also raised the question whether his claim was based on fresh evidence and what constituted “fresh” evidence for the purpose of a claim to set aside a judgment or settlement for fraud.
In Finzi v Jamaican Redevelopment Foundation Inc & Ors [2023] UKPC 29 the Board dismissed Mr Finzi’s appeal. In doing so Lord Leggatt remarked on the risks attendant on a party being vexed by allegations of fraud in a way that amounted to wasteful and duplicative litigation so that the courts needed to be astute to prevent a party from putting its case one way only to come up with another way after losing, thus giving rise to the same process a second time. The same consideration, he said, “applies with equal, if not greater force, in the familiar situation where a party who has entered into a compromise agreement afterwards regrets having done so and attempts to re-open the litigation.”
Declining to follow the approach of the Court of Appeal in Park v CNH Industrial Capital Europe Ltd (where too much weight had been given to obiter remarks of Lord Sumption in Takhar v Gracefield Developments Ltd), the Board held that, where a party wished to rely on new evidence,
“[T]he burden is on the claimant to establish (1) that the evidence is new in the sense that it has been obtained since the judgment or settlement, or (2) if the evidence is not new in this sense, any matters relied on to explain why the evidence was not deployed in the original action. Furthermore, where the evidence is not shown to be new in this sense, the claim is likely to be regarded as abusive unless the claimant is able to show a good reason which prevented or significantly impeded the use of the evidence in the original action.
In some cases it may also be relevant to take account of the apparent strength of the case of fraud. As on other interim applications, the court will naturally be concerned to avoid a detailed examination of the merits of the claim. Holding a mini-trial is not an efficient use of resources. But if the pleaded case of fraud is on its face conspicuously strong or conspicuously weak (even if not so weak that it cannot be said that the claim has no real prospect of success), this potentially affects the justice or otherwise of allowing the new claim to proceed to trial.”
In deciding that Mr Finzi had not satisfied that burden, the Board had regard to the following matters:
Lord Leggatt concluded with this warning:
“There are sayings, mentioned in Takhar, that fraud ‘is a thing apart’ and that fraud ‘unravels all’. But allegations of fraud are not to be regarded as some kind of open sesame which have only to be uttered to enable a party to engage in a new round of litigation of disputes that have been compromised or decided. In this case it is clear that, well before he entered into what was meant to be a final settlement of all outstanding claims, Mr Finzi had all the material on which he now relies to allege fraud, and that he had ample opportunity to deploy it in the earlier proceedings if he had thought fit to do so. He has offered no explanation of any merit for the fact that he did not. The Board is satisfied that the judge made no relevant error of law and that in the circumstances there is no real prospect of disturbing the judge’s assessment that this action is an abuse of process.”