UK: When Will New Proceedings To Set Aside A Judgment For Fraud Be An Abuse Of Process?

In the latest Court of Appeal hearing as part of a long-running property development dispute, Gowling WLG succeeded for its client Gracefield Developments Limited in the Court of Appeal. In doing so the Court clarified the threshold a party must meet to avoid new proceedings concerning the same matter being an abuse of process.

The background

In 1999, Mrs Takhar became the owner of a number of properties in Coventry following her separation from her husband. The properties were subject to rates arrears and many were dilapidated. Mrs Takhar transferred the properties to a newly incorporated company, Gracefield Developments Limited, to facilitate their development. That transfer was, Gracefield said, pursuant to a profit sharing agreement reached in November 2005 and documented in 2006.

The 2008 claim

The parties subsequently fell into dispute about how the properties were to be treated and, in 2008, Mrs Takhar brought proceedings against Gracefield. She said that the parties had agreed the properties were to be renovated and then let. Gracefield's case was that the properties were to be redeveloped and then sold, with any profits to be split equally between Mrs Takhar and Gracefield.

At trial, the judge preferred Gracefield's account of what had been agreed, as supported by a scanned copy of a written joint venture agreement (the JV agreement) which bore Mrs Takhar's signature. Mrs Takhar contended that she had not signed the JV agreement and had not been aware of it until the dispute arose. But the judge found that the JV agreement reflected the oral agreement the parties had reached previously for the redevelopment and sale of the properties, and therefore dismissed Mrs Takhar's claim.

The 2013 claim

In 2013, Mrs Takhar issued a new claim. She provided evidence from a handwriting expert which she said proved that she had never signed the JV agreement, but that a copy of her signature had instead been transposed onto it from another document. She sought to have the judgment in the 2008 claim set aside on the basis that it had been obtained by fraud.

Gracefield said that the 2013 claim was an abuse of process and should be struck out, as:

  • The documents on which the handwriting expert had given his view and which formed the basis of the 2013 claim had been available to Mrs Takhar since at least 12 months before the trial of the 2008 claim;
  • Mrs Takhar had sought to adduce the evidence of a handwriting expert in the 2008 claim, but permission had been refused; and
  • The evidence that Mrs Takhar had signed the JV agreement was not determinative of the 2008 claim in any event.

In the High Court, Newey J determined - as a preliminary issue - the question whether the 2013 claim was an abuse of process. He concluded that Mrs Takhar had a real prospect of satisfying the court that judgment in the 2008 claim had been obtained by fraud. The 2013 claim was not therefore an abuse of process, and he ordered for it to proceed to trial.

Gracefield appealed this refusal to strike out the 2013 claim.

Court of Appeal

It was common ground between the parties that the relevant test for setting aside a judgment for fraud was summarised in Royal Bank of Scotland plc v Highland Financial Partners LP [2013] EWCA Civ 328, namely that:

  • There must have been conscious and deliberate dishonesty in evidence given to or a matter concealed from the court, which is relevant to the judgment;
  • The evidence or concealment must be material - the fresh evidence would have entirely changed the way the first court approached and came to its decision; and
  • The materiality of the new evidence is to be assessed in context of the evidence given at the original trial, not on basis of a retrial.

Newey J had concluded that Mrs Takhar had prospects of satisfying these requirements and so had ordered that the claim should proceed.

However, Gracefield argued that Newey J had erred in limiting himself to that question. It submitted that, in order to adduce new evidence of alleged fraud (and avoid a finding of abuse of process), Mrs Takhar also had to satisfy the test in Ladd v Marshall [1954] WLR 1489, i.e. by demonstrating to the court's satisfaction that the new evidence she relied on in the 2013 claim:

  • could not have been obtained with reasonable diligence before the trial of the 2008 claim;
  • would be likely to have an important (but not necessarily decisive) influence on the result of the case;
  • must be apparently credible (but not incontrovertible).

Mrs Takhar contended that no such 'reasonable diligence' requirement applied where the new evidence indicated that there had been a fraud, and that she should not be precluded from having an judgment allegedly obtained by fraud set aside simply because she had been at worst negligent in failing to bring that evidence to court in the 2008 claim.

Delivering the leading judgment, Lord Justice Patten started with a review of early authorities on the distinct but overlapping principles of abuse of process and res judicata. He pointed to the rule in Henderson v Henderson that litigants must bring forward their whole case; they cannot (except under special circumstances) re-open the subject of litigation later only because they have, "from negligence, inadvertence or even accident, omitted part of their case". He went on to say that Virgin Atlantic Airways Ltd v Premium Aircraft Interiors UK Ltd [2013] UKSC 46 (a case in which Gowling WLG predecessor firm Wragge & Co LLP represented the successful party) made clear that rule is also the background to and part of the rules governing the doctrine of res judicata (i.e. a matter which has already been adjudicated by a competent authority and cannot be re-litigated).

In a unanimous decision, the court held that it did not matter whether a claim was defended on the basis of abuse of process or res judicata - in either case the same policy considerations were engaged. While a party may seek to set aside a judgment which is alleged to have been obtained by fraud (and that operates as an exception to the rule in Henderson v Henderson), that exception is subject to the additional requirement that evidence of the alleged fraud must not have been available to the party seeking to rely on it at the earlier trial.

The court therefore remitted the case to Newey J to determine whether Mrs Takhar has also satisfied the reasonable diligence condition, i.e. whether evidence of the alleged fraud could and should have been deployed at the trial of the 2008 claim so as to render the 2013 claim an abuse.

What does this show?

The case illustrates the court taking a balancing approach between two important policy considerations. On the one hand, there is a public interest in unravelling fraud, and so setting aside a judgment if it can be demonstrated it was obtained fraudulently. On the other though, there is a competing interest in the finality of litigation, and in preventing litigants from seeking to re-litigate the same subject matter by bringing new claims based on facts which were available to them at the time of the earlier trial.

In this case, the Court of Appeal firmly favoured finality of litigation over fraud unravelling everything, especially where the evidence of the fraud was available at the time of the original trial.

Points to remember

  • Litigants should investigate claims fully at the outset and ensure that they bring all claims which can be properly evidenced.
  • Claims brought at a later date, which could have been evidenced in earlier proceedings, are liable to be struck out as an abuse of process or res judicata.

For a contrasting case where later discovery of fraud allowed a party to unravel a settlement agreement, see our article "Suspicion of fraud does not prevent unravelling a settlement".

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Events from this Firm
21 Sep 2017, Seminar, London, UK

Has Cloud replaced traditional outsourcing models? We will compare cloud to outsourcing, consider whether they have effectively become the same thing for many solutions and assess some of the advantages and disadvantages of each model.

3 Oct 2017, Seminar, London, UK

Join us over breakfast for our third retail-focused seminar.

17 Oct 2017, Workshop, Birmingham, UK

This practical workshop will take in-house counsel through the life of a brand, providing guidance on issues which regularly arise.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.