Church Commissioners for England v Hamidi and others and four similar claims

Claim Numbers: 1CL10419; 1CL10421; 2CL10390; 2CL103912; CL10392 IN THE CENTRAL LONDON COUNTY COURT CHANCERY LIST HIS HONOUR JUDGE GERALD Sitting on 15th to 18th and 25th January 2013 and 1st February 2013 Judgment formally handed down on 4th February 2013 Claim Number: 1CL10419 (formerly 0CL03202) B E T W E E N :- CHURCH COMMISSIONERS FOR ENGLAND Claimants -and- ABOO REYHAN HAMIDI MICHELLE JOURNO M BASSFORD MICHA NAWAL ABOU HAMDAN Defendants (Philip Rainey QC and James Fieldsend instructed by Charles Russell for the Claimants) (Defendants not appearing or represented) Claim Number: 1CL10421 (formerly 1CL01505) B E T W E E N :- CHURCH COMMISSIONERS FOR ENGLAND Claimants -and- MICHA REMINGTON COMMERCIAL LIMITED PHAROAH INVESTMENT LIMITED GEORGE FERREIRA IMAN EL RAYES NAWAL ABOU HAMDAN MORESURE LIMITED GUILDING FIELDS LIMITED TAYEB AL RIHANY SAMIR ANDRAWES Defendants (Philip Rainey QC and James Fieldsend instructed by Charles Russell for the Claimants) (First to Ninth Defendants not appearing or represented) (Adam Chambers instructed by Myers Fletcher Gordon for the Tenth Defendant) Claim Number: 2CL10390 B E T W E E N :- CHURCH COMMISSIONERS FOR ENGLAND Claimants -and- MORESURE LIMITED Defendant (Philip Rainey QC and James Fieldsend instructed by Charles Russell for the Claimants) (Defendant not appearing or represented) Claim Number: 2CL10391 B E T W E E N :- CHURCH COMMISSIONERS FOR ENGLAND Claimants -and- GUILDING FIELDS LIMITED MS JUSTINA GRIGAITE Defendants (Philip Rainey QC and James Fieldsend instructed by Charles Russell for the Claimants) (First Defendant not appearing or represented) (Adam Chambers instructed by Myers Fletcher Gordon for the Second Defendant) Claim Number: 2CL10392 B E T W E E N :- CHURCH COMMISSIONERS FOR ENGLAND Claimants -and- GUILDING FIELDS LIMITED SAMIR ANDRAWES Defendants (Philip Rainey QC and James Fieldsend instructed by Charles Russell for the Claimants) (First Defendant not appearing or represented) (Adam Chambers instructed by Myers Fletcher Gordon for the Second Defendant) JUDGMENT HIS HONOUR JUDGE GERALD:- Introduction Alleyn Court is situate at 123 to 127 Sussex Gardens, Paddington, London (th August 1955 the Claimants granted a ninety-nine year lease of what was then a development site ( The Headlease was assigned by Matoldge Limited (th September 2005 who on 30th November 2005 granted a legal charge to Finance and Credit Corporation Limited (was also granted an irrevocable power of attorney as is customary. On 6th June 2007, the charge was assigned to Michath November 2007 and the whole block on or shortly after 6th February 2008. As such was, for the purpose of observing the covenants in the Headlease, the successor in title to Mr Hamidi and Ms Journo: section 79 of the Law of Property Act 1925. The legal title however remained vested in Mr Hamidi and Ms Juorno at the time of the breaches complained of, and until May 2011, so making them necessary parties for the claim under section 168 of the Commonhold and Leasehold Reform Act 2002 as amended as ( For brevity, I will refer to Remington Commercial Limited as yeb Al Rihany as Samir Andrawes as the Landlord and Tenant Act 1987 as Leasehold Reform Urban Housing and Development Act 1993 as amended as The allegation central to all five claims before me is that the defendants (orchestrated by Mr Hamdan) conspired by unlawful means to deprive the Claimants of their freehold by falsely claiming to have sufficient qualifying tenancies (fourteen) to pass the statutory threshold of not less than one-half of the total number of flats (twelve) required to serve a notice to collectively enfranchise or acquire the freehold under section 13 of the 1993 Act. In parentheses I note here (for a reason which will become apparent) that the same threshold is required to mount a claim for a Right to Manage (Chapter 1 of Part 2 of the 2002 Act. This, it is alleged, was sought to be achieved in three ways. First, by claiming that four of the fourteen tenancies (flats 24, 26, 27 and 28) were sub-leases had been granted unlawfully by Mr Hamdan who had unlawfully sub-divided and converted the basement into four residential units. Secondly, by disguising the fact that nine or so of the fourteen tenancies (including the four new ones) were owned by Mr Hamdan by registering seven of them in the names of his nominees (including the corporate defendants, or fathereby disqualifying them from being all are disqualified from being a ). Thirdly, to disguise the scheme and make it difficult to unravel, causing various sub-leases to be The first claim (1CL10419) was issued on 17th January 2011 seeking inter alia a declaration under section 168 of the 2002 Act that Mr Hamdan had acted in breach of covenant by granting sub-leases for and physically sub-dividing the basement into five new units or flats, a necessary precursor to forfeiture proceedings. Four months later, on 18th May 2011, Mr Hamdan assigned the Headlease to his sister Nawal for a stated consideration of th February 2009, nor his trustee in bankruptcy Mr Bassford nor Ms Juorno have played any part in this claim. The second claim (1CL10421) was issued on 19th May 2011 seeking inter alia a declaration that the first nine defendants did not have a right to collectively enfranchise and an injunction preventing them from exercising rights of collective enfranchisement. Mr Andrawes was joined as tenth defendant on the second day of the trial, 16th January 2013, when it emerged that flat 24 had been assigned to him the previous week by Mr Al Rihany for a stated consideration of 124,000. This claim was prompted by receipt of an initial notice dated 12th November 2010 served under section 13 of the 1993 Act by the first nine defendants who appointed Mr Al Rihany as nominee purchaser (th March 2011 issued claim 1CL10420 (formerly 1CL00492) seeking a declaration that those same nine defendants were Al Rihany Claim The Al Rihany Claim was disposed of by order made on 25th May 2012 following Mr Al Rihanyth May 2012 that his Notice was formally invalid on its face: he was ordered to pay costs. That left open the substantive questions of whether there were various of the fourteen allegedly qualifying tenants were disqualified by being in fact owned by Mr Hamdan albeit via fa Those allegations were repeated in the second claim, as well as the allegation that the defendants had all been part of the conspiracy to unlawfully deprive the Claimants of their freehold. The original nine defendants (and Mr Andrawes) denied that any were Mr Hamdan The third, fourth and fifth claims, issued on 22nd August 2012 against Moresure (2CL10390) and Guilding Fields (2CL10391 and 2CL10392), were prompted by receipt of three separate initial notices each dated 15th June 2012 served under section 42 of the 1993 Act seeking new long leases in respect of flats 26, 27 and 28. The Claimants allege that these are formally and substantively invalid and that the flats had been created as part of the conspiracy to deprive the Claimants of their freehold. Within a month, neither defendant having filed a defence, flats 27 and 28 were transferred to Ms Grigate (flat 27) and Mr Andrawes (flat 28) (both having purchased them at auction on 12th September 2011) who were then added as defendants to the respective claims by order dated 20th October 2012. Errors, omissions and misunderstandings A draft of this judgment was provided to trial Counsel who were given an opportunity to consider and make submissions as to whether it contained any errors or misunderstandings in relation to the evidence (as distinct from findings) or submissions or whether there were any material points consideration of which had been omitted. Apart from some typing and minor factual errors none were suggested. Developments shortly before trial 20th December 2012 – CMC On 20th December 2012 all five claims were listed for a one day pre-trial review largely to accommodate two applications dated 30th October 2012, one made by Mr Hamdan for relief from having been debarred from defending the first and second claims on 7th September 2012 and the other by Ms Hamdan to amend her Defence (and Mr Hamdan and another application by Ms Hamdan dated 7th December 2012 to vacate the ten day trial due to start on 14th January 2013. The only parties represented were the Claimants, Mr Hamdan and his sister (both represented by Stan Gallagher of counsel) and Ms Grigaite and Mr Andrawes. All three applications were withdrawn on 17th December 2012 with indemnity costs orders being agreed. Ms Hamdan submitted to an order to file witness statements to prove the authenticity of various documents listed in the Claimantsth November 2012 Notice to Prove by no later than 4pm on 4th January 2013. Having failed to do so, she was ordered on 9th January 2013 to comply or (in effect) admit that those documents were not genuine by 4pm on 10th January 2013 failing which her defence to the first and second claims would be struck out and she would be debarred from defending the claims: she failed to comply with that order. 9th January 2013 Meanwhile, by application notice dated 9th January 2013 but issued on 10th January 2013 and supported by a witness statement from Ms Hamdan (the first one from her, so far as I am aware), she applied for the trial to be vacated because she had changed solicitors (having, it emerged, dis-instructed her solicitors Howard Kennedy on 2nd January 2013) and because she was in the process of remedying the breaches complained of which th January 2013 when she was ordered to attend the trial. She did not attend trial, nor did or has she applied for relief from sanctions imposed by the 9th January 2013 order. 14th January 2013 On 8th January 2013, the day before his sisteran Interim Order (claim number 46-I0-2012) imposing a moratorium on continuing with the claims against him had been made on 14th December 2012 based on a proposal made on 12th December 2012 and extended on 21st December 2012. Extraordinarily, neither the Claimants nor the court were notified of any of this at the 20th December 2012 CMC or otherwise by Mr Hamdan On 14th January 2013 the Claimants applied for an order under section 252(2) IA 1986 which I made. I was referred to Hall v van der Heiden [2010] EWHC 537 (TCC); [2010] BPIR 585 and also Clarke v Coutts & Co [2002] EWCA Civ 943; [2002] BPIR 916 (power to grant retrospective permission). The reasons for my granting the order were as flows. First, a failure to do so would have put in jeopardy the 20th December 2012 order which Mr Hamdan, then represented by solicitors and counsel who both knew about the Interim Order, had acceded to following withdrawal of his application on 17th December 2012 and agreement to pay costs. Secondly, it was a naked attempt to avoid trial, plainly being co-ordinated with his sister, where the evidence against both is overwhelming and where his sister had already made clear that the breaches were to be remedied and both of whom along with all other original defendants (that is, all but Ms Grigaite and Mr Andrawes) had been debarred from defending for disobeying numerous court orders and in which Mr Hamdan (and his sister) sought to rely upon fabricated documents one of which bore a false Central London County Court stamp. Thirdly, having voluntarily debarred himself from proceedings by withdrawal of his application, there was no reason why the trial should not continue. It is also right to note that, as the Claimants submitted, some aspects of the IVA proposal seem somewhat surprising and improbable. Its centre piece is an unconditional gift of th September 2011 to buy flat 26 from Moresure. This is not the only well known name which appears in this case. For example, there is Mr Hamdan, although keeping in email contact with the court (see below), has not applied to vary that order. On 24th January 2013 he instructed Olephants solicitors and Mr Warents of counsel who appeared on Friday 25th January 2013 with instructions limited to seeking variations to interim freezing injunctions which I had granted at trial-end (18th January 2013) pending handing down of judgment having first made various orders including ones for costs (see further below). Position at commencement of trial Having made the section 252 order and Mr Andrawes having been joined to the second claim on 16th January 2013, the position (and taking into account admissions made by Ms Grigaite and Mr Andrawes counsel Mr Chambers) was as follows: Mr Hamdan remained debarred from defending the first and second claims having withdrawn his 30th October 2012 application for relief from the debarring order made on 7th September 2012 for failing to disclose certain documents (a declaration in general terms for breach of unspecified covenants in the first action also being made on 7th September) Ms Hamdan remained debarred from defending the first and second claims having failed to apply for relief following her failure to comply with the debarring order made on 9th January 2013 Mr Andrawes maintained his defence to the second claim albeit that at trial he accepted that Mr Al Rihany was not a All other defendants remained debarred from defending the second claim having failed to apply for relief from the debarring order made on 25th May 2012 which followed their failure to give standard disclosure with copy documents in accordance with an unless order made on 11th January 2012 The corporate defendants (Remington, Pharoah, Moresure and Guilding Fields) were declared to be th May 2012 in the second claim, no such order being made in the third, fourth and fifth claims The third, fourth and fifth claims were to proceed as in accordance with orders made on 7th September 2012 and 3rd October 2012 but Mr Andrawes and Ms Grigaite both accepted at trial that Moresure and Guilding Fields were not For completeness, I record that Mr Chambers conceded the section 42 notices in relation to flats 27 and 28 were invalid because they had not been properly signed by Guilding Fields, there being only one unwitnessed signature contrary to what was required by section 99(5)(a) of the 1993 Act and section 44 of the 2006 Act (see Hilmi v 20 Pembridge Villas Limited [2010] 1 WLR 2750). Further, it was conceded, they had in any event lapsed because there benefit had not been assigned with the relevant sub-lease as required by section 43(1) of the 1993 Act. The same arguments, I hold, apply to Moresure Issues for determination There remained three (overlapping) issues for determination: Have there been breaches of covenant (there being no explicit admissions from Ms Hamdan or her brother; both being debarred from defending, and legal title to the Headlease having been vested in Mr Hamidi and Ms Juorno at the date of the breaches relied upon)? Were flats 24, 26, 27 and 28 as at 15th June 2012 (the original defendants not being bound by their successorsthat all were debarred from defending)? Was there a conspiracy and if so who did it involve (the above issues being central to this)? Trial in absence It was in those circumstances that I decided to exercise my discretion under CPR 39.3 to allow the trial to continue in the absence of those parties not represented and absent. Not only have they all had ample opportunity to attend, but there has been a wholesale disregard of court rules and orders, many of which were made in the absence of the defendants who simply did not attend the hearings. This has resulted in a huge amount of court time being used and set aside to deal with the numerous applications which have been made, the most recent example being the wasted one day of court time set aside for the PTR principally to deal with the Hamdans It is difficult to resist the conclusion that the applications for relief from sanctions and to amend Ms Hamdan The time had come when the claims needed to be resolved at trial. That the Hamdans had elected not to attend was a decision they knowingly made. That in reality there is no defence to the first, third, fourth and fifth claims is demonstrated not just by the failure of the original defendants to engage in the court process but also by the one line statement contained in the one and only witness statement from Ms Hamdan to vacate the trial because the breaches were being remedied. And there is now no defence to the conspiracy allegation before the court, save in respect of Mr Andrawes and Ms Grigaite. Developments during trial Although neither Mr Hamdan nor his representatives attended trial, it is right to record that on 16th (at 14.15hrs) 17th and again on 21st (at 07.21hrs) January 2013 he sent emails to my clerk which the Claimants objected to on the grounds that they contained privileged communications. Those emails have not been read by me or by court staff. I do not know what they contain, but merely note that Mr Hamdan It also emerged at trial that in the week or so before works had been commenced purportedly to remedy the breaches. These continued during the trial, with additional witness statements being filed by the Claimants to up-date the court. Although not clear, it appears that flats 26 and 28 have been at least partially restored to their former garage condition and perhaps that remedial works have been or are being carried out to the remainder of the basement. I will refer further to this below. I should say here that what I must Evidential position Documents Despite the voluminous documentation before the court, key documents such as those relating to the relationship between the original defendants, payment of purchase monies, proof as to authenticity of certain documents, works that were undertaken in the basement, resolutions said to have been taken by the corporate defendants (for example when buying or selling the flats) are not before the court because those defendants have failed to comply with disclosure orders. Appropriate adverse inferences are permissible: see J v J [1995] P 215 at 227. Oral evidence The twenty Claimant witnesses who all attended and gave evidence under oath are listed in the annexure to this judgment where I also define how I will refer to them. Their evidence is supported by voluminous photographic evidence proving the state of the basement and overall premises at key dates. In the absence of any material challenge to any aspect of their evidence by Mr Chambers, I accept their evidence in its entirety supported as it is by the photographic evidence and other documents. Ms Grigate and Mrr Andrawes attended to give evidence and were cross-examined. As will become apparent and for the reasons below stated, I did not find either to be impressive, credible or reliable witnesses. With regard to the Hamdans, only two witness statements had been filed. One from Mr Hamdan, the other from Hicham El Jamal (. Ms Hamdan was to rely upon her brother, appropriate adverse inferences may be made: see Re Coroin Limited [2012] EWHC 2343 at paras 258 to 262 and Wisniewski v Central Manchester HA [1998] PIQR 324 at 337 to 340. Headlease The main covenants upon which the Claimants rely are contained in paragraph 14 of the Second Schedule to the Headlease which by clause 2 the lessees had covenanted to observe. It is a very long paragraph which, for convenience, I have broken up and set out the material parts and, for brevity, will refer to as keep and use the said demised premises as one Block of high class self-contained furnished flatlets and one self-contained flat only such Block comprising eighteen furnished one-roomed flatlets and one furnished two-roomed flatlet and one unfurnished flat and either lock-up garages with each such flatlet and the flat keep and use that part of the Basement of the demised premises which is planned for the purpose if and so far as is legally authorised for the lodging of one housekeeper or caretaker only employed by the Lessee in or about the said Block and such housekeeper and will keep and use the remainder of the said basement for storage or boxrooms boiler house and lift motor room in connection with the use and occupation of the said flatlets and for no other purpose and will keep and use the said garages as not more than eight lock-up garages for housing therein of motor cars further sub-divide the demised premises nor shall the said garages be used for purposes of habitation cause any nuisance damage annoyance or inconvenience to the others and occupiers of adjoining and neighbouring property Paragraph 15 of the Second Schedule is also lengthy, the material part being that:- r disturbance to the Commissioners or any of their Lessees or tenants or the owners or occupiers of any property in the neighbourhood Paragraph 16 of the First Schedule is shorter, the material part being that:- Although paragraph 14 envisaged 18 flats with a housekeeperth July 1958 certificate (pursuant to the usual building covenants contained in the First Schedule) that Alleyn Court had been built in accordance with the provisions of the Headlease which, necessarily, would include the 17th January 1957 planning permission which is consistent with Alleyn Court as-built. The caretaker was, it seems, housed in ground floor flat 2 until it was sold on long lease. The effect of this is twofold. First, that part of paragraph 14(b) referring to a housekeeper or caretakeror planning permission to use any part of the basement for either purpose. Secondly, paragraph 14 prohibits any residential user of any nature whatsoever in the basement. It is of course immaterial to the operation of paragraph 14 that a different number of garages were in fact built. There has been no subsequent grant of planning permission or landlord Facts The position in 2005 According to Mr Bennett who owned several flats within Alleyn Court and had spoken with Mr Hamidi and also Mr Hamdan, Mr Hamidi had purchased Alleyn Court with the intention of merging it with the adjoining ABC Hotel which he also had a long lease of and converting them into serviced apartments. One of his partners, or business associates, was Mr Hamdan, which might explain why he procured assignment the of Finco charge. Whilst Mr Bennett At the time of the 2005 assignment to Mr Hamidi, the basement comprised two rear double garages and three rooms. The double garages each had two single led down from the ground floor hall opening directly into the basement hall located between the two double garages. A small toilet was in the corner of the basement hall which also housed the electrical fuse boxes serving the rest of the block. A door opened from the hall into a large room at the front of the building which had a door opening into a smaller room also at the front both of which had windows looking into the usual light well which had small storage rooms or vaults under the roadway. There was a small door in the large room opening into the light well where there was a fire escape ladder leading up to street level. There was no internal access to the double garages from the basement hall. That was Mr Bennett The position in 2006 and 2007 Mr Bennett next visited the basement sometime in mid-2006. He was aware that earlier that year a conditional planning permission had been granted to convert the three rooms into a one bedroom flat. He described what he saw, which he sketched onto a plan produced as exhibit marked A (It was nothing like what planning permission had been granted for. A door had been installed at the bottom of the stairs which opened into the basement hall. The wall between the hall and large front room had been demolished to form what Mr Bennett described as an open plan office area with storage and small kitchen units with an old-style shower stall in the hall. The small room continuing to be used for general storage. There was no sign of a bed or sleeping accommodation or the basement otherwise being used as a flat. That is consistent with other basement inspections conducted in 2006 and February 2007 referred to by the ClaimantsMr Baynes of Cluttons and Mr Marsh, paralegal of solicitors RadcliffeLeBrasseurs (Radcliffes Attempts to collectively enfranchise in 2006 and 2007 Meanwhile, Mr Hamdan had been acquiring ownership or control of flats within Alleyn Court in order to enable a section 13 notice to be served, which was done by Pharoah serving a section 13 notice on 19th December 2006 at which time (so far as I can tell from the evidence before me) Mr Hamdan owned or controlled ten flats. Ms Chambers, the lessee of flat 19, who had previously refused to sell her flat to Mr Hamdan, was invited to join in but did not. The Claimants challenged Pharoah on various grounds, including that the th March 2007, conceding that the notice was invalid. Although the reason for invalidity is not stated, as a matter of fact Mr Hamdan was then the registered owner of three flats (1, 9 and 14) and so disqualified from supporting a section 13 notice. For brevity, I will refer to the flats owned or controlled by Mr Hamdan as Notwithstanding the invalidity of the Pharoah section 13 notice, Mr Hamdan used it to deny the validity of leases granted pursuant to section 42 notices (which cannot be proceeded with whilst collective enfranchisement is in progress) served by the owners of flats 7, 10, 15 and 22. This resulted in litigation which ultimately resulted in an order for summary judgment against Mr Hamdan who was ordered to pay costs. I will refer to this later as it also relates to Ms Grigaite. Mr Hamdan, however, remained keen to acquire the freehold and serve a new section 13 notice. Pausing here, by conceding formal (as distinct from substantive) invalidity Mr Hamdan preserved the right to serve a new section 13 notice at any time. Had the notice been formally valid but withdrawn all tenants would have been prohibited from serving a new notice for twelve months. It was in that context that, on 18th April 2007, he wrote to Mr Bennett seeking his support. Although not then pursued, in early 2007 registered ownership of the Hamdan flats was re-organised, and new ones acquired, to ensure compliance with section 5(5). Specifically:- Mr Hamdan acquired flat 12 on 13th March 2007 but had it registered in Mr Ferreirahe (Mr Hamdan) was already the registered owner of flats 1, 9 and 14. He transferred flat 14 to his sister Mrs El Rayes on 24th May 2007 to reduce his registered ownership to two flats (1 and 9). Pharoah acquired flat 23 in January 2007 but transferred it to Remington on 23rd March 2007 because it (Pharoah) was already the registered owner of flats 6 and acquired flat 21 on 23rd February 2007 making it the registered owner of two flats (6 and 21). Mr Marsh (Radcliffes) said that in May 2008 Mr Hamidi told him that Mr Ferreira did not exist. Although hearsay, that evidence was unchallenged. That flat 12 was held beneficially by Mr Hamdan is supported by a declaration of trust purportedly made by Mr Ferreira (date indecipherable) who also appointed Mr Hamdan his attorney. A copy of an expired passport has been disclosed by Mr Hamdan, but he has failed to produce the original. Notice was given requiring proof of authenticity of that document at trial, on 1st February 2012 which has not been done. Whether or not Mr Ferraira exists, I find that he was Mr Hamdan. Mr Hamidi and Mr Hamdan fall out What is clear is that by late 2006 Mr Hamdan and Mr Hamidi had fallen out. Both were accusing the other of using various parts of the building for prostitution. Mr Hamidi was claiming that Mr Hamdan had attempted to buy the freehold behind his back and wanted the Claimants to oppose the Pharoah section 13 notice. Indeed, on 18th December 2006, the day before Pharoah Whatever the position between them, Mr Hamdan gained the upper hand by taking an assignment of the Finco charge on 6th June 2007, demanding repayment under it an then initially appointing a LPA receiver of the Headlease but then obtaining an order for possession of the basement in November 2007 and then the whole building in February 2008. It was not until late July 2008 that Mr Hamdan told the Claimants (Mr Baynes) that he had taken possession of Alleyn Court, shortly after he had evicted Mr Hamidi (4th June 2008). 2008 basement inspection On 12th May 2008 there was an inspection of the basement carried out by Mr McKeown of the Claimants and Mr Baynes (Cluttons) and Mr Marsh (Radclirres). It was Mr Baynese basement rooms looked like an office: he did not recall it looking like a flat. Mr Marshto him like it had been converted into a self-contained flat and if it was being used for living all that needed to be done was for furniture to be removed. I find that at this point in time the basement had not been converted into a self-contained flat. The context of that inspection was the continuing allegations and counter-allegations between Mr Hamidi and Mr Hamdan, the suggestion that the basement might be being used as a flat and also Mr Hamidist May 2008, anxious to avoid any possibility of waiver of breach, the Claimants stopped accepting rent due under the Headlease. And it was on 4th June 2008 or thereabouts that Mr Hamdan evicted Mr Hamidi, it therefore following that at that point in time the basement had not been converted into a flat. 31st July 2009 basement inspection On 31st July 2009 Mr Heffron inspected the basement and produced a report which was served on Mr Hamdan as mortgagee in possession. In evidence before me, he produced some photographs which he had taken at the time, and were produced as exhibit B. He described what he saw which he sketched on a plan, produced as exhibit C ( The context of that inspection was renewed concern that the basement had been converted into a flat, and various allegations from other tenants that it was being used for prostitution. One of Mr Hamdaned in his Defences, is that Mr Hamidi had converted the basement into a flat before he took possession as mortgagee. I find this to be untrue: the basement was converted by Mr Hamdan sometime before the July 2009 inspection and after Mr Hamidi had been evicted in June 2008. The Claimantso such findings. December 2009 – the RTM claim By December 2009, a Right to Manage company had been formed by the twelve long-leaseholders not associated with Mr Hamdan who for brevity I shall refer to as . Their solicitor was Mr Fleming of William Heath solicitors. Mr Hamdan then owned or controlled ten flats (1, 6, 9, 12, 14, 16, 17, 18, 21 and 23). They issued RTM notices on 9th and 15th December 2009 and applied to the Leasehold Valuation Tribunal (motivated by Mr Hamdanproperly manage the building (th April 2010 and continuing on 7th and 11th June 2010 but was dismissed on essentially technical grounds by decision dated 19th August 2010 which was unsuccessfully appealed to the Upper Tribunal. Whatever the substantive merits of the RTM claim, it was defeated on technical grounds. November 2009 obstruction of access to basement fuse box A particular example of mis-management is provided by Mr Driver, the new owner of flat 10. He suffered a power cut on 13th November 2009 requiring immediate access by the utility company to the communal fuse box in the basement only to find it locked (it was then being used as a flat). Instead of being allowed immediate access, he was subjected by Mr Hamdan to a torrent of abuse, accusations and demands for payment for access which ultimately involved Mr Driver engaging solicitors and involving the Claimants, Westminster City Council (and two police officers before the utility company was allowed access and power was restored on 26th November 2009. In his witness statement Mr Hamdan does not deny the breach but dismisses it all with a metaphorical Meanwhile – grant of sub-leases Whilst denying Mr Driver access to the basement fuse box and whilst the non-Hamdan tenants were busy issuing RTM claims, Mr Hamdan was apparently granting leases of five different areas of the basement. Units 24, 27 and 28 were respectively granted to Remington by sub-leases dated 6th, 26th and 12th November 2009 for stated premiums of th November and 2nd December 2009 for stated premiums of th March 2010; the Remington ones on 15th April 2010. All five basement sub-leases were in common form and granted for a term of just less than 45 years from 1st November 2009. All contained the usual forfeiture provisions and tenant Thus, Remington and Mrs El Rayes had ostensibly paid a total of in both leases. They could not be used as a single private residence without breaching covenants in both leases. The covenants within the sub-leases themselves were mutually stultifying. By taking the grants, the sub-lessees had put themselves into a double bind, and had purchased something which could not lawfully be created or used. The payments are referred to as having been th September 2012 witness statement made during the course of these claims where he admitted that no money had actually changed hands but that the consideration was some sort of cancellation of debts owed by Mr Hamdan to Remington in respect of flat 1 which he had previously owned personally. Either way, there has been no disclosure of any evidence to establish that any money changed hands. March 2010 In March 2010 a cupboard bearing the outward appearance of a flat was erected by Mr Hamdan in the ground floor hall as demised flat 27 (but does not) and houses its hot water cylinder (which it does). 26th April 2010 LVT hearing At the 26th April 2010 hearing of the RTM claim before the LVT Mr Hamdan produced copies of sub-leases of flats 24, 27 and 28 to Mr Fleming who had previously discovered about the grant of sub-leases of flats 25 and 26 from his own searches of the Land Registry because the non-Hamdan tenants were intending to serve a section 13 notice so he needed to ascertain who had long-leases. 21st May 2010 transfers (registered on 1st June 2010) The new sub-leases left Remington with four flats (23, 24, 27 and 28) and Mrs El Rayes with three (14, 25 and 26), which would disqualify all seven from being st May 2010: Remington transferred flats 27 and 28 to Guilding Fields ostensibly for Mrs El Rayes transferred flats 25 and 26 to Moresure ostensibly for first noted on the register on 11th December 2012, Ms Hamdan declared that she held flat 16, which she had owned since 20th October 2006, on trust for her sister Mrs El Rayes. Thus, Remington and Mrs El Rayes had ostensibly received a total of th September 2010, Remington sold flat 24 to Mr Al Rihany who ostensibly paid (thereby leaving Remington with two flats and removing it from the disqualification provisions of section 5(5) of the 1993 Act). There is no evidence of any money changing hands. 7th June 2010 LVT hearing At the 7th June 2010 hearing of the RTM claim before the LVT Mr Hamdan by his counsel Stan Gallagher, having been shown photographs of the basement, conceded that the basement had not been sub-divided and converted into four or five separate flats so could not be held by th June 2010 referring to a letter also dated 4th June 2010 notifying the Claimants, apparently for the second time, of the grant of the sub-leases, which will feature further below. 2nd July 2010 On 2nd July 2010, the non-Hamdan tenants served a section 13 notice on the Claimants who were obliged to inform Mr Hamdan as mortgagee in possession of the Headlease (th August 2010 was to direct the Claimants to challenge the formal validity of that notice which they duly did on 31st August 2010. Had he successfully challenged its substantive invalidity, causing the non-Hamdan tenants to withdraw it, he would have been prevented from serving a section 13 notice for twelve months. 29th July to October/November 2010 On 29th July 2010 Ms Chambers saw that chipboard hoardings had been gone up around the basement as a pre-cursor to their sub-division to five units and conversion to four flats (24, 26, 27 and 28) by end-October 2010, the fifth flat 25 being completed in November 2011. On 4th October 2010 the site was inspected by various building control and planning officers from WCC as well as Mr Lilley, chartered surveyor employed by Knight Frank the Claimantsth October 2010 with the structural engineer Mr Lane, Ms Dalal from Charles Russell in the presence of Mr Hamdan and his solicitor Mr da Costa. When he got back to the office, Mr Lilley produced a sketch plan of what he had seen ( WCC issued an enforcement notice for breach of Building Regulations on 2nd November 2010 which caused Mr Hamdan to appoint his own structural engineer or surveyor who ultimately rectified all complaints ensuring that the works were building regulation-compliant. There is no dispute as to the nature and extent of the conversion works, which I summarise principally by reference to the WCC plan which is sketched on to the plan used for the planning application back in 2005. Rear double garage east was sub-divided into two. The smaller part was ultimately used, in November 2011, to create flat 25, apparently intended to be used for a caretaker. The larger part was used to create a studio flat with about one-third of the basement hall being annexed to form a new kitchen and a toilet/shower room where the original toilet was. French doors were substituted for the rear garage doors in November 2010 (flat 26) and in November 2011 (flat 25). Rear double garage west was converted into a large studio flat with new kitchen and toilet/shower room to create flat 27. The two garage doors were substituted by French windows with a small dwarf wall built about a metre away to provide a little outside area. Flat 27 The small front room to the west was converted into a small studio flat with toilet/shower room to form flat 28. The large front room was converted into a one-bedroom flat which annexed a small part of the hall for the kitchen to form flat 24 but also ceded part to form a re-configured hall. Six of the seven windows opening into the light well were enlarged and new windows installed. The remains of the original hall was merged with part of the large front room to create a hall to serve all of the basement flats except flat 25 which was to be independently accessed from the rear but continued to house the communal fuse boxes. A new cupboard was created in the part of the hall which had formerly been part of the front room. A new door was installed at the top of the stairs at ground floor level demarked by numbers 24, 26, 27 and 28. In effect, a new suite of flats was created in the basement with their own separate door, flat 25 to be independently accessed from the rear yard. New numbers were added to the entryphone by the front door. The fire escape in the light well was relocated. All of this involved making openings to floor slabs, internal and external walls and alterations to ground and floor levels to allow for ventilation, plumbing, drainage and the usual services and facilities to be expected of self-contained flats or studios. Confusingly, the footprint of these new flats did not match what had been demised. Comparing as built flats shown on the WCC plan with the as demised units shown on the sub-lease plans, the position is as follows: Demised unit 24 comprised the whole of the two front rooms and most of the whole of the original hall except for about two-thirds of the kitchen and toilet/shower room which as-built was ceded to flat 26 rather than being confined to the as-built part of the front room and small area of the original hall. Demised unit 25 comprised approximately one-half of rear garage east Demised unit 26 comprised the other half of rear garage east but none of the hall, so that flat 26 Demised unit 27 comprised approximately one-half of rear garage west and also the equivalent size of the rear yard marked as a parking space rather than the whole of that garage and a small part of the rear yard up to the dwarf wall as-built. Demised unit 27 did not include the ground floor cupboard housing its hot water cylinder. Demised unit 28 comprised the other half of rear garage west and also the equivalent size of the rear yard marked as a parking space rather than the as-built original small front room. Who did the work? From the evidence before me, it is plain that it was Mr Hamdan who arranged for the works to be carried out. In his witness statements, he says that in order to receive the best possible terms on grant of the sub-leases he agreed he would help the sub-lessees convert them and acted as unpaid consultant (no such written contract has been produced). He says that Remington and Mrs El Rayes employed Mr Jamal to do the work in April and May 2010, which is what Mr El Jamal says in his witness statement. This is bogus because (a) the works were not started until after 29th July 2010 (b) at which time the basement flats were no longer owned by the original sub-lessees Remington or Mrs El Rayes but by the assignees Moresure and Guilding Fields. I find that Mr El Jamal was employed by Mr Hamdan to carry out the building works for him. Despite being ordered to do so, there is no disclosure relating to the building works. Appended to this judgment are two Appendices summarising their false statements, which should be treated as being part of and read into this judgment. Back to the RTM claim and subsequently Meanwhile, as I have said, the non-Hamdan tenants had lost the RTM claim on essentially technical grounds (19th August 2010). On 1st October 2010 their solicitor Mr Fleming visited the basement and discovered that it had been sub-divided and converted into four flats. All of this resulted in a somewhat triumphalist email from Mr Hamdan to the Claimantsth October 2010 in which he observed that What Mr Hamdan was saying was that by reason of the four new flats having been physically created he was now in control and could defeat any renewed RTM claim but also any new section 13 notice once their 2nd July 2010 section 13 notice had been dismissed and then serve his own. Just over three weeks later, on 27th October 2010, the non-Hamdan tenants conceded that their 2nd July 2010 section 13 notice was formally invalid. Within a very short order, Mr Hamdan served a new section 13 notice dated 12th November 2010 (the Al Rihany Notice) upon which now takes centre stage. At that time, Mr Hamdan owned or controlled only ten of the flats (1, 6, 9, 12, 14, 16, 17, 18, 21 and 23). He therefore relied upon the four new basement flats (24, 26, 27 and 28) to produce a total of 14 out of 27 flats. By then they had been registered in a confection of different corporate and individual names, none being registered with more than two participating flats. (I infer flat 25 was not completed so as to ensure that he had a majority as opposed to simply one-half of qualifying tenancies.) It was in those circumstances that the first claim was issued on 17th January 2011 which was met by the Al-Rihany Claim on 11th March 2011 to which the Claimants responded by issuing the second claim on 19th May 2011. Use of basement since October 2010 At varying times, the basement flats have been occupied for residential purposes, along with flat 25 after its conversion the following year. 18th May 2011 On 18th May 2011, Mr Hamdan assigned the Headlease to his sister Nawal for a stated consideration of , she then being the registered owner of flats 16 and 18. She apparently borrowed the purchase monies from Achieving Perfection Limited ( Nine months later she proposed a price of th October 2012, she charged it to APL to secure its loan. 12th September 2011 auction of flats 24, 27 and 28 On 12th September 2011 flats 26, 27 and 28 were auctioned by Bernard Marcus. The successful bidders were John F Kennedy (Mr Andrawes (flat 28) and Ms Grigaite (flat 27) albeit that she only completed on flat 27. It is thought that this is the same JFK referred to in Mr Hamdan October to December 2011 Shortly after flat 25 was completed in October or November 2011, new garage blocks were built in the rear yard. One was built on part of as demised units 25 and 27. Another was built on the footprint of as demised unit 28 and just behind the dwarf wall. Some of these works were carried out on Christmas Eve and Boxing Day and was so loud that Ms Chambers phoned WCC to complain. 15th June 2012 section 42 notices Notwithstanding that the first and second claims were on foot and that on 25th May 2012 the court had declared that Moresure and Guilding Fields were fath June 2010 he (I infer) caused section 42 notices to be served in respect of those three flats which resulted in issuance of the third, fourth and fifth claims on 22nd August 2012. Unlike with collective enfranchisement, there is no bar on multiple ownership of flats to the exercise of individual rights of enfranchisement. Planning and building regulation enforcement Mr Lashkariani (WCC 10th January 2013 Ms Chambers, Mr McKeown and Mr Dharmesena gave evidence and produced photographs which showed that from 10th January 2013 onwards demolition works were carried out to the basement by Mr Hamdan It appears that by the end of the trial at least one of the unlawful rear garages, the rear dwarf wall and some of the new concrete floor levels had been demolished and removed and some if not all of the rear flats had been th January 2013 application to vacate. It was accepted by Mr Andrawes and Ms Grigaite, albeit that she said that Mr El Jamal was contracted by her directly and it was a coincidence that he was doing other works of demolition at the same time. I will revert to this later. I say The Hamdans Although debarred from defending and neither in fact attended to give evidence, it is right to record the position taken by the Hamdans. The substance of their pleaded Defences was that sometime before June 2008 Mr Hamidi had converted the basement into a flat which had been sub-divided and converted into two flats (24 and 28) in November 2009 and the garages converted into two flats (26 and 27) in July 2010 which breaches had been waived because the Claimants had been served with notice of grant of the related sub-leases shortly after grant which the Claimants had not objected to until October 2010 during which time Mr Hamdan had expended large sums in converting the basement into four flats in reliance on (in effect) the Claimants Those pleaded Defences are lengthy, not especially easy to follow and short on particulars. Even if taken at face value, they are demonstrably wrong. First, the basement was converted into a flat by Mr Hamdan sometime between June 2008 and July 2009, not by Mr Hamidi. Secondly, the basement flat had not been converted into two flats in November 2009 as Mr Hamdan was forced to admit on 7th June 2010: it is not clear how the same counsel, Stan Gallagher, could have pleaded the contrary some nine months later in Mr Hamdanth June 2010, some five or six months after their apparent grant: see below. Further detail was provided in Mr Hamdanth September 2012 witness statement and also his 29th October 2012 witness statement in support of his sistersaid that on 6th August 2009 he had written to Mr Baynes telling him of his plans to convert the basement within fourteen days unless the Claimantsto grant long leases of them. He said he had sent copies of the new sub-leases on 10th December 2009 together with the usual registration fee. Not having received any response, he said that he went ahead and converted the basement into four self-contained flats in April and May 2010 as planned. This was confirmed by witness statement from the builder Mr El-Jamal. On 4th June 2010, not having received any acknowledgement, he said he wrote again enclosing a copy of his 10th December 2009 letter. The first objection he received was Radcliffeletter of 10th June 2010 (not October 2012 as he had previously said) by which time, in effect, it was too late as he had spent money and converted the flats, thereby estopping the Claimants from objecting. This was not true. No conversion works were carried out to the basement until after 29th July 2010 Mr Hamdan had admitted on 7th June 2010 before the LVT that the basement had not then been converted. The (highly significant) 6th August 2009 letter was not pleaded in the Defences. It is a fabrication: it refers to the claim number of the first claim (0CL03202, later renumbered 1CL10419) which had not then been issued (date of issuance: 17th January 2011). Mr Baynes It is a most serious fabrication because it is addressed to the court manager of the Central London County Court at a time when he would have no interest in it (because the claim had not been issued) and which has apparently applied not one but two official 7th August 2009 date stamps upon it. I infer from what Mr Hamdan says in his witness statements, and find, that he has somehow transposed the date stamp from documents generated in other litigation he was involved in at Central London County Court. The 6th August 2009 letter with its court stamps on it was plainly calculated to deceive the Claimant and the court into believing that it was a genuine letter and provide evidence to re-calibrate the date when building works and so on were done and fabricate the basis of a waiver or an estoppel. Within two months of making its first appearance in his 28th September 2012 witness statement and the Claimants serving notice requiring proof of authenticity (30th November 2012), Mr Hamdan (and his sister) had on 17th December 2012 withdrawn all reliance upon the 6th August 2009 letter as well as the 10th December 2009 one. The 4th June 2010 letter, enclosing a copy of the 10th December 2009 letter, is the same date as the witness statement Mr Hamdan made in the RTM claim in which he claimed to have sent copies of the sub-leases to the Claimants, being three days before the 7th June 2010 LVT hearing. As Mr Fleming explains in his witness statement and is evident from the related correspondence, it is plain that that letter, and that witness statement, was prompted by disclosure of Mr Flemingh the Claimants who, by their solicitors, had in May 2010 confirmed that they had not received notification of any new sub-lease grants from Mr Hamdan. I accept the Claimants0th December 2009 letter. The date of the 10th December 2009 letter is of significance. It is just before the 15th December 2009 RTM notice upon which the RTM claim was initially based. One of the arguments in the RTM claim was that it was invalid because the notices had not been served on flats 24 to 28 inclusive. As far as I can tell on the evidence before me, this allegation was only raised after the LVTth March 2010 directions had been issued. It was therefore necessary to obtain evidence that the sub-leases had been granted and existed at the time of that notice, which is why the 10th December 2010 was selected. Tied in with that date are (unsigned) notices confirming notification to the Claimants of those sub-leases filed at HM Land Registry. Whilst the allegation was withdrawn in respect of units 26 to 28 it was maintained in respect of flat 24 on the footing that the 15th (or the 9th) December 2009 notices should have been served on Mr Hamidi and Ms Juorno because they were the th November 2009 sub-lease of unit 24 had not been perfected so that Remington was not the qualifying tenant, alternatively Mr Hamdan should have been served by reason of being mortgagee in possession of that flat. The LVT accepted that Mr Hamidi and Ms Juorno were the The conclusion I draw here is that the sub-lease of flat 24 was held back from the 21st May 2010 assignment of the other basement flats in order to ensure that the defence to the RTM claim, that the RTM notice should have been served on the new basement flat called flat 24, could be maintained. Once the RTM claim was disposed of (29th August 2010) it was th September 2010). The fact that the sub-lease of flat 24 was not crucial to that claim is immaterial, as is the fact that as demised unit 24 was in fact not the whole of the pre-existing new basement flat (see below). Some specific findings of fact Drawings those strands together, Mr Hamdan had all along intended to acquire the freehold. He was galvanised into action, or his hand was forced, by the non-Hamdan tenants. In order to acquire that which he could not lawfully acquire he devised his plan to create sufficient flats to enable service of a section 13 notice and also defeat any renewed RTM claim I find that the 10th December 2009 letter (and the notices of like date) was (and were) not created until shortly before the 4th June 2010 letter, most probably sometime after the 3rd March 2010 LVT directions. The sub-leases were not in fact granted until shortly before their registration in March and April 2010. They were back dated to November and 2nd December 2009 and stated to have started on 1st November 2009 in order to prove that they were on foot before issuance of the RTM claim in 9th or 15th December 2009. Mr Hamdan used them to mislead the LVT. But that was overtaken by his concession on 7th June 2010 that the units had not been converted so that none constituted Having disclosed the sub-leases in the RTM claim on 26th April 2010, Mr Hamdan was forced to disclose them to the Claimants which he did for the first time on 4th June 2010. He knew their grant was in breach of Headlease covenant to keep the basement as garages and storage. They were created in reaction to and in order to defeat the RTM claim and lay the ground for himself serving a section 13 notice, Mr Hamdan then believing that the mere grant of the sub-leases would suffice to establish the requisite number flats and so outnumber the non-Hamdan tenants. He did not then realise the flats needed to be in physical existence to qualify. Having conceded on 7th June 2010 that the flats were not Mr Hamdan realised, no doubt advised by counsel, that he needed to get the basement converted in order to defeat any new RTM claim and also any section 13 notice which by then he must have realised the non-Hamdan tenants were limbering up to serve and in any event this was required to enable him to serve a new section 13 notice to acquire the freehold. The ante was upped when the non-Hamdan tenants did serve their 2nd July 2010 section 13 notice. Contractors were engaged to convert the basement, ready to defeat any new RTM or collective enfranchisement claim by the non-Hamdan tenants, and ready to pounce by serving his own section 13 notice once the RTM claim and non-Hamdan tenants section 13 notice had been defeated (19th August and 27th October 2010 respectively). Contractors started on site on 29th July and completed the conversion of four flats by end October 2010 since when some or all have been occupied. He knew this was in breach of the Headlease user covenants and the various covenants against sub-division, alteration and so on. The purpose of the 6th August 2009 letter when read with the 10th December 2009 was to recalibrate what had happened so that he could claim waiver or estoppel thereby legitimising his scheme. At the same time, behind the scenes, Mr Hamdan was ensuring that not more than two flats were registered in the names of one of his nominees vide the 21st May 2010 transfers already referred to. At the time of making them, and indeed right back to the time of the Ferreira and other transfers made at that time, Mr Hamdan knew that this was critical to avoid disqualification by section 5(5). I infer that the new sub-leases were granted to Remington and Mrs El Rayes (thereby disqualifying them) either because he was caught on the hop or because there is some other reason which is not immediately apparent. Either way, the problem was resolved by the 21st May 2010 transfers. Roof To avoid complicating things further, I have not referred in detail to the sub-leases of roof spaces designated flats 29 and 30 which Mr Hamdan granted sister Nawal on 29th November 2009 and 10th December 2009 (the same day as the fabricated 10th December 2009 letter) for th March 2010 and they were referred to in his 4th June 2010 witness statement and letter and were then transferred to a nominee company on 21st May 2010 for and registered on 1st June 2010, the same date as the transfers of the basement flats, which are then transferred to Mr Andrawes on 12th September 2012. This was all part of his attempt to create more and mislead the LVT, and I make the same findings in relation to them as above, namely, that they were not in fact created until sometime after 3rd March 2010 and no notices had been served on the Claimants on 10th December 2009.I will touch on them again later. Some more general findings of fact Those specific findings are directly relevant to the matters in issue. They should be considered in the overall context of the other undisputed evidence relating to the conduct of the Hamdans as successive head-lessees of Alleyn Court. The overarching evidence of Mr Bennett, Ms Chambers and Mr Driver (the only non-Hamdan tenants giving evidence before me) is that since the Hamdans Mr Hamdan and sister Nawal have allowed the common parts of the block to fall into a state which vide Mr Driver having no electricity for over a week in November 2009, rubbish being piled up outside Janet Griffiths When outbid by Mr Cramer at auction of flat 17 by the mortgagee in possession, four days later Mr Hamdan caused its front door to be smashed down and then bricked up. This terrified other tenants, who feared leaving their own flats in case the same thing happened to them. Mr Hamdan subsequently acquired flat 17 himself by purporting as mortgagee in possession to forfeit the existing lease. He used it as one of the th July 2010: see below. In August 2012 Nawal, on behalf of her brother, tried to persuade Ms Chambers to joint in the purchase of the freehold in return for being released from the adverse costs order of in excess of th October 2011 by one In early December 2012, shortly after her witness statement had been served on the Hamdans, Ms Chambers arrived home to find a new metal grille door had been installed which, if locked, prevented access to her. She had intimidating confrontations with Mr Keen about getting a key which Mr Hamdan was well aware of. As far back as 2006, Ms Chambers had refused to participate in Mr Hamdan(Pharoah) section 13 notice or sell him her flat. However, Mr Bennett was prepared to sell three of the flats in which he had in interest in to Mr Hamdan and even agreed the prices only for it to fizzle out. Thus, Mr Hamdan could have acquired an additional three flats lawfully had he so wished or, perhaps, he insufficient funds. Mr Hamdan acting in excess of powers as mortgagee in possession A mortgagee may only exercise his powers for proper purposes, namely protecting or realising his security (the Headlease) to repay the secured debt and not for some collateral advantage or gain or purpose. Mr Hamdan knew that that was the purpose because he says so in his 28th September 2012 witness statement. In my judgment, it is clear from the foregoing that the sole purpose of granting the sub-leases was to enable him in his personal capacity qua qualifying tenant of flat 9 (and 17) to acquire the freehold and gain control of Alleyn Court. Had it been to realise the security to repay secured debts, money would have changed hands and been applied to those debts. Furthermore, the block would have been properly maintained, not allowed to fall into such a poor state to cause the RTM claim to be issued, and Mr Hamdan would not have jeopardise the very security upon which he relied by rendering it liable to forfeiture by the most flagrant and cavalier breaches of covenant let alone laid it (and himself) open to planning (and building regulation) enforcement proceedings. The Claimants did not press their pleaded claim for a declaration that the sub-leases were invalid and should be set aside for having been made in breach of covenant. They did press their claim that they should not be treated as binding upon the Claimants for the purpose of satisfying the statutory criteria. In my judgment, especially when taken into the factors below, they should be so disregarded. It is also doubtful whether the assignment to Ms Hamdan was in proper exercise of his powers given its timing and evidence of apparent gross undervalue (if it in fact had any or any substantial value). However, it has not been necessary to make any findings in that regard save to observe that it is part of the overall shuffling around of registered titles to meet the exigencies of the time. Issue one: have there been breaches of covenant? Creation of the basement flats Creating the new flats was in breach of covenant because such involved sub-subdivision of the basement into five flats which themselves were further sub-divided to create bathrooms or toilet/shower-rooms (paragraph 14) and the covenant against making alterations to the internal and external plan and architectural appearance (paragraph 16) as was substitution of the garage doors with French windows, building the ground floor hall cupboard to house flat 27 The caretakergranting the sub-leases and then creating and then using the basement as flats was in breach of the covenant to keep and use the basement Enlarging the front basement windows, creating openings between the garages and the basement hall and in the external and internal walls and floor slabs to allow ventilation and conduits for electrical and sanitary services and facilities and moving the front fire escape around were all in breach of the covenant against making alterations (paragraph 16). Obstruction of access to the communal fuse box in the basement hall The obstruction of the owner of flat 10 from accessing the communal fuse box in the basement in November 2009 was in breach of covenant not to cause nuisance or annoyance to other occupiers of Alleyn Court (paragraph 15). Section 168 of the 2002 Act In those circumstances, I therefore find and declare that there have been breaches of covenant contained in the Headlease pursuant to and for the purposes of section 168(2) of the 2002 Act perpetrated by Mr Hamdan. The specific breaches detailed in the Schedule to the final order made on 25th January 2013 should be treated as read into this judgment. I also find and declare that the defences to the first claim are totally without merit. Post-issuance breaches Completion of the conversion of rear garage east to form flat 25 and construction of the new garages in the rear yard were also in plain breach of covenant, as is demonstrated by the fact of the apparent reconversion of flat 25 to a garage and demolition of the new garages blocks during January 2013. Although not pleaded or relied upon by the Claimants (no doubt to avoid the risks of waiver), I mention those matters for the sake of completion as all are clear on the evidence and some are referred to by the Hamdans. Issue two: were flats 24, 26, 27 and 28 held by th November 2010 or 15th June 2012? Law The collective right to enfranchise or acquire the freehold can only be exercised by at least one-half of By section 5(1), a person is a A and Findings There was no th November 2010) or the section 42 notices (15th June 2012). Whilst those three flats (as built) were plainly self-contained flats, there was no long lease of any of them in their as built form. Whilst the sub-leases all exceed 21 years, none of the as demised units encompassed the whole of the as built flat envelope thereby preventing each from being constructed or adapted for use as a dwelling irrespective of their lawfulness. Specifically: Demised unit 26 bears little relationship to as built flat 26: the demise did not include that part of the basement hall annexed to accommodate the kitchen and toilet/shower room without which it could not sensibly be said to have been a long lease of a separate dwelling; Demised unit 27 bears no relationship to as built flat 27: the demise did not have a wall separating it from unit 28 (being the other half of rear garage west) or include the bathroom or much of the kitchen area situated within as demised unit 28 so could not sensibly be said to have been a long lease of a separate dwelling (not forgetting the fact that its hot water cylinder in the ground floor cupboard was excluded from the demise without which the demise had no hot water); and Demised unit 28 not only bears no relationship at all to as built flat 28 (being the front small room (as built), not half of rear garage west (as demised)) but as demised had no wall separating it from demised unit 27 (the other half of rear garage west) and did not include most of the kitchen area situated within demised unit 27 so could not sensibly be said to have been a long lease of a separate dwelling. Put shortly, whilst on 12th November 2010 and also 15th June 2012 as built flats 26, 27 and 28 were undoubtedly each a Howard de Walden v Aggio [2009] 1 AC 39), it must include a flat. There could have been no claim for rectification or argument that the sub-leases should be treated as excluding or including (as appropriate) the were advanced in the Hamdansefences or by Mr Chambers. In reality, the sub-leases of 26, 27 and 28 were no more than of garages in which bits and pieces of the usual accoutrements of a Findings With regard to as demised unit 24, the position is slightly different. At the time of grant it did not comprise what could sensibly be called a flat because the as demised unit excluded the toilet/shower room and most of the kitchen comprised within the basement flat as converted sometime before July 2009. By 12th November 2010 it comprised two self contained flats (as built flats 24 and 28) and the reconfigured basement hall. As Aggio (supra) makes clear, it is immaterial whether the demise includes more than one flat or additional areas. In this respect, I accept the submission of Mr Chambers that flat 24 was a th November 2010, subject to what next follows. For completeness, this does not create two Findings Where a mere carapace is created to conceal unlawful conduct and intent and designed to vest in the wrongdoer rights he did not previously have and was not previously entitled to it in my judgment cannot be said that the tenancies fall within the provisions of any part of the 1993 Act. Put starkly, can the rights granted by the 1993 Act be exercised and maintained by those who have unlawfully created and then acquired the sub-leases and flats? Was it the intent of Parliament that the statutory rights could be used to convert the unlawful into the lawful thereby denuding the landlord of his freehold by the wrongdoer and the true majority qualifying tenants of their rights to acquire the freehold? Was it intended that a tenant could convert his unlawful tenancy into a new long lease by statute? The simple answer is, in my judgment, per se unlawful, and physical sub-division to create the flats was doubly unlawful.) Whilst not expressed, it would be an odd result for Parliament to have intended by dint of statute to legitimise the illegitimate, to vest valuable rights in those who did not have them but for their breach, and to divest those who did have them. Otherwise, persons of ill intent could sub-divide and grant new leases at will thereby gaining something not previously entitled to. In my judgment, this construction is consistent with the general observations of the Court of Appeal in Cadogan v McGirk [1996] 4 All ER 643 on the interpretation of the 1993 Act: That is not to say that there is an absolute prohibition on unlawful long leases or physical alterations to create flats. The unlawful may be rendered lawful by waiver, estoppel and such like in which case a essentially factual questions are: is there such that a landlord acting reasonably could properly have objected to it had his consent been sought. This is not inconsistent with the moratorium on forfeiture proceedings in relation to individual enfranchisement imposed by paragraph 6 of Schedule 12 to the 1993 Act (no forfeiture without leave of court after service of section 42 notice). That provides an alternative route for the landlord to challenge an unlawful tenancy or flat, and is more directed at preventing forfeiture battles over breaches unrelated to the per se lawfulness of the tenancy or flat. A large part of Mr Rainey Similar arguments were advanced in respect of the breaches of planning legislation and building regulations. Specifically, that whilst each of the flats were undoubtedly Cadogan v McGirk [1996] 4 All ER 643 at 649b-c) focus on the physical configuration of the flat itself in answering that question, they do not suggest that the legal context of the construction or adaptation of the flat must be ignored. If that were so, Parliament would by the 1993 Act have undermined the integrity of the planning regime. In short, where a flat has been (in this case deliberately) built in breach of planning control and never will get planning permission, can it properly be said to satisfy the section 101(1) definition? In my judgment, the answer is That is not to say that planning permission must have been granted at the time of service of the notice. A similar enquiry to that posited above will ensue. Is there a substantial breach of planning control? Is there deemed consent by four years As with any development, there will always be minor transgressions, and whether they are of sufficient substance to prevent the flat coming with the 1993 Act definition will be a question of fact and degree. The Claimants did not rely upon the breaches of building regulations because ex post facto they have been rectified. They did rely upon the absence of planning permission which has not been remedied. In my judgment, the absence of planning permission prevents any of the basement flats constituting If I am wrong about those conclusions, in my judgment the maxim that a person may not benefit from his own wrong, and cannot take the benefit of statutory rights if he has to prove or rely upon his own unlawful acts, applies. I here refer to the principles as enunciated by Lord Mance JSC at paragraphs 45 to 58 of Welwyn Hatfield BC v Secretary of State [2011] 2 AC 304. His Lordship said: Applying that principle to the facts of that case, his Lordship went on: Applying either of those reasons the sub-lease of unit 24, the unlawful sub-division and creation of two new flats within the demise of (part only of) the basement flat can not convert what did not qualify as as demised unit 24) into one which did (as built flat 24 or 28) because such had been created unlawfully or because such would require Mr Hamdan to prove and take advantage of his own wrong in order to exercise statutory rights. It therefore follows that he (or his apparent successor Mr Andrawes) could not and may not participate in service of a section 13 notice or serve a section 42 notice. Mr Chambers conceded that his clients Issue three: conspiracy Law The ingredients of a conspiracy to injure by unlawful means are set out in Kuwait Oil Tanker Co v Al Bader [2002] 1 All ER (Comm) 271 at paragraph 108 thus: There are therefore four ingredients of the conspiracy alleged by the Claimants, as was stated by Morgan J in paragraph 2 of Annex 1 to Digicel St Lucia v Cable & Wireless [2010] EWHC 774 (Ch): Paragraphs 72 to 85 of the Annexure were also cited, and should be read into this judgment. Original defendants It is perfectly permissible, and an every day occurrence and how the 1993 Act works, for a qualifying tenant wishing to acquire the freehold by exercising the statutory right of enfranchisement to assemble a group of like minded folk (existing or prospective qualifying tenants) to achieve that end. It is equally permissible for ownership to be assembled so as to ensure non-contravention of section 5(5): rights of collective enfranchisement may be exercised by trustees vide section 93A acting in accordance with the trust powers. What in my judgment is not permissible, and is unlawful, is for a qualifying tenant to manufacture, or fabricate, compliance with statutory criteria by unlawfully creating so-called long leases of so-called flats in breach of covenant as well as, in this case, in breach of planning control so as to satisfy the statutory criteria when in fact they are not (and cannot be) satisfied and registering them in mere nominees. There is the added ingredient of Mr Hamdan acting in excess of his powers as mortgagee in possession. Without the unlawful sub-leases and flats the Claimants could not It follows from the findings of fact I have already made that Mr Hamdan intended to injure the Claimants by acquiring the freehold when he knew he was not entitled to. In order to do so, he granted the sub-leases and then physically sub-divided and converted the basement into flats and in so doing acted in excess of his powers as mortgagee in possession and in breach of covenant and also planning (and building) control. He plainly knew he was acting in breach of covenant and also of planning (and building) control and, I have no doubt, well-understood that what he was doing was an improper exercise of his powers as mortgagee because it was for personal gain not in proper realisation or protection of the Headlease (which he was in fact jeopardising). To circumvent section 5(5), he caused some of the flats to be registered in fa Remington, Pharoah, Moresure and Guilding Fields were all key players, and have been declared to be mere faFirst, to Even without that declaration, it in my judgment is quite clear from the evidence which has been adduced that all four corporate defendants were indeed the mere fa Remington (Belize-incorporated) and Pharoah (Seychelles-incorporate) both have bearer shares. Remington Guilding Fields and Moresure are both UK registered companies whose shares are still (surprisingly) held by the same formation agents Alexander & Co Limited (now dormant) but one of whose directors is the builder Mr El Jamal (Guilding Fields) and the other Whilst that information does not necessarily indicate that they are mere fa In my judgment there is strong evidence that Mrs El Rayes and Ms Hamdan agreed with and fully participated in their brother First, the grant of the sub-leases was utterly un-commercial, it being in my judgment inherently improbable and unlikele that two supposedly separate entities (Remington and Mrs El Rayes) would independently pay, or agree to pay, a total of for open basement spaces whose leases contained mutually stultifying provisions preventing any lawful user or sub-division. That they had to be executed in a hurry and back-dated leads to the inferences that Mrs El Rayes (and Remington) understood why: control and therefore the freehold might be lost to the non-Hamdan tenants. Secondly, the assignment of the four basement sub-leases on 21st May 2010 was equally un-commercial as the original grants, it again in my judgment being equally improbable and unlikely that two supposedly independent vendors would sell on the same date to two supposedly independent purchasers (Moresure and Guilding Fields) who would ostensibly pay a total of four open basement spaces (flats 25, 26, 27 and 28) which could not lawfully be used and which had been Thirdly, at the same time, Ms Hamdan was granted two leases of roof space flats 29 and 30 which she transferred on 21st May 2010. I do not dwell on their lawfulness. Their significance for these purposes is that they tie Ms Hamdan into her brother That the first assignments happened so quickly and in lock-step and at a critical juncture of the RTM claim (between the first two hearing dates) also leads to the inference that the sisters both knew perfectly well what was going on (as did the companies). I should add here that it is quite possible that the 21st May 2010 transfers were also back-dated: one would have expected Mr Hamdan to refer to them in his 4th June 2010 witness statement in the RTM claim and in his letter of that date to the Claimants but he does not. Fourthly, had Moresure and Guilding Fields been truly independent one would have expected them to at least check that the basement flats as built equated to the as demised footprint. There is also no documentary evidence of what was paid, for what, by whom or where the money came from. So confused had Mr Hamdan got that he and Mr El Jamal both say that it was Remington and Mrs El Rayes who contracted Mr El Jamal do to the works at a time when they were no longer the registered proprietors. As I have already held, it was Mr Hamdan who engaged Mr El Jamal. This is a point which runs through all of the subsequent assignments. It is a basic pre-requisite of an arms-length sale at value that the demise is compared with what is actually being sold and that there is planning permission. There is no evidence of any assignee (apart from Ms Grigaite but even there to a very limited extent) being remotely concerned about any of these problems which, after all, are so fundamental as to cause Ms Hamdan to apply for the trial to be vacated because the flats are being re-converted back to their former use thereby destroying their Fifthly, that the assignment of flat 24 by Remington to Mr Al Rihany on 13th September 2010 ostensibly for is inherently improbable and unlikely. First, it and the Headlease were liable to forfeiture so only represented a I see no reason to suppose that Mr Al Rihany did not know that he was not a qualifying tenant, and indeed he ultimately accepted that the tenants for whom he was acting had no authority to serve the section 13 notice they did serve. It strikes me that that concession (20th May 2012) was propitious, coming as it did just five days before the 25th May 2012 hearings at which all corporate defendants were declared to be faformal invalidity of the Al Rihany Notice cannot have been lost on Mr Al Rihany: by so doing it preserved their ability to serve a new section 13 notice without having to wait a year, and there is evidence (Ms Chambers) that attempts were made during 2012 to garner support for a new section 13 notice which, presumably, would have been used to supersede the 12th November 2010 one. Sixthly, the third lock-step event was the 12th September 2011 public auction at which flats 26 (Moresure) and 27 and 28 (Guilding Fields) were auctioned to people connected to the Hamdans. It is inherently improbable that this would occur without connection between the participants. In short: brother grants six sub-leases of flats which do not physically exist to his two sisters (and a nominee company) who then assign them to his nominee companies which then assign them (apart from flat 26) to Seventhly, there is no evidence of Ms Hamdan complaining about the slum-state of and other carryings on in Alleyn Court or that she acted any differently from her brother once the Headlease had been assigned to her, again noting that she remained the registered owner of flats 16 and 18 whose capital and rental value, if acting reasonably and properly and if they truly belonged to her, she would have wanted to protect. It in my judgment is right to infer that Ms Hamdan was well aware of and supported the plan to drive non-Hamdan tenants out of the block, forcing a sale at a low price. Finally, I find it odd that the only witness statement from Ms Hamdan is that made on 9th January 2013 seeking to vacate trial. I find it even odder that she left it to her brother to apply for permission to amend her Defence to the first claim and to provide the only substantive witness statement upon which she intended, had she continued with the action, to rely upon. I infer two things from this. First, that she knew that the 6th August and 10th December 2009 were fabrications but she was not prepared to put herself on the line. Secondly, she was nonetheless content to participate in an attempt to mislead and deceive the Claimants and the court, which is consistent with my findings that she was fully aware of and shared her brother Furthermore, the only time she does go into print (9th January 2013) in quite literally a one line statement she virtually admits all breaches of covenant. Yet she (and her brother) have for over a year consistently denied any breach and sought to rely upon a totally without merit Defence and then amend to rely upon fabricated documents. That to my mind is not an act of an honest person. Neither is it the act of someone who had no prior knowledge about what was going on and why. And given just how enmeshed she (and her sister Iman) are in all of the transactions it would in my judgment be quite impossible to reach an alternative conclusion. With regard to Mr Ferreira, assuming he exists, he has been very much a bit player, making his first entranced back in 2007. However, assuming he exists, given the timing and circumstances of the acquisition of flat 12, the fact that he plainly knew Mr Andrawes back in August 2007, the fact that he apparently joined in the Al Rihany Notice and that no explanation for his involvement has been put forward, it in my judgment is right to infer and find that he too was part of the conspiracy orchestrated by Mr Hamdan or at the very least was willing for his name to be used to add a veneer of independence. All original defendants adopted a common defence to the second claim. None have sought to put or set out an independent position. None have given evidence. All have breached orders to disclose material which would have shed light on the true relationship between the parties. In my judgment, it is right, and fair in the facts and circumstances already set out, to infer that none have any answer to the evidence adduced by the Claimants and the findings and inferences I have made. Ms Grigaite and Mr Andrawes Introduction. Although joined as a defendant to the second claim, there is no separately pleaded claim against Mr Andrawes in respect of flat 24, it being asserted that he bought as Mr Hamdan The essence of the fourth and fifth claims against Ms Grigaite and Mr Andrawes is the same: at the time of their purchase at public auction on 12th September 2011 they each knew that their respective flats 27 and 28 had been created unlawfully and by bidding at auction and taking the assignment have acted in furtherance and part of the conspiracy. They deny any conspiracy, saying that they bought it at auction. In this aspect of the case, Ms Grigaite or Mr Andrawes can only be liable if there was a conspiracy between the other defendants. They both accept that they purchased with the intention of taking the benefit of the section 42 notice already served. Mr Chambers did not seek to suggest that the Claimants had not made out their case for conspiracy against the original defendants. He accepted that the central question is the nature and extent of his clients knowledge of what had gone on before and what if anything they intended by bidding at auction. Whilst their positions must be considered separately, the starting point is to consider the public auction held on 12th September 2011. Naturally, one might think, sale at public auction would firewall any allegation of complicity between vendor and purchaser. Not so here I find. In my judgment, it is inherently improbable that: three flats in the same block then owned by two different entities (Mr Al Rihany (24), Moresure (26) and Guilding Fields (27 and 28) would come up for public auction at the same time that the successful bidders would all be people who in one way or another were associated with or known to or had been involved in one way or another with Mr Hamdan and/or his sister and/or Alleyn Court any one unconnected with Mr Hamdan and without some sort of arrangement with him would purchase the flats given the nature and extent of the breaches of covenant and enforcement notices for breach of planning control then extant which if successful would cause not only the premium to be lost but would attract financial liability in having to restore and make good breaches, let alone pay any one unconnected with Mr Hamdan would buy where the as demised unit was quite different from the as built flats What was Ms Grigaite She also has an arrangement with Mr Hamdan whereby she will take short leases of repossessioned flats which are in a bad state, do them up and let them out. She knows there is a risk of forfeiture. If that happens, then her arrangement with Mr Hamdan is that he will repay the premium of She accepted that she knew Ms Hamdan and APL had loaned her th October 2012, APL took a charge over the Headlease. The timing is obviously somewhat unfortunate given the stage which these claims had then reached. Her explanation was that she did not know about it, and in any event it was part of the original arrangement that if not repaid within six months Ms Hamdan would grant a charge over the Headlease. She was just asked to do so six months late. It is difficult to resist the conclusion that APL is being used to set up a transfer of the Headlease to protect it from creditors and also frustrate the Claimants With regard to the auction itself, Ms Grigaite dismissed as a coincidence that the successful bidders were all known to Mr Hamdan in one way or another. She had no real explanation for why she had not completed the acquisition of flat 24. She said that she knew flat 27 was at risk because of forfeiture, but that if there was a problem she felt she would be able to just change it back to a garage and pay a fee for relief from forfeiture. At first blush, this aspect of her evidence seemed quite credible. However, on proper consideration it was not. First, she accepted that she knew the as built flat she was buying. Yet she was only buying half of it. She seemed genuinely surprised: I accept that she was, but in my view she had not previously bothered to pay attention to it because although she most probably bought it on her own account she was not fussed because she was doing Mr Hamdan Another aspect of her evidence which was most unsatisfactory was her denial that she had spoken with Mr Hamdan or at any rate the agent direct when that is precisely what the relevant emails said. And the final major aspect of her evidence which was incredible concerned the buildings works being carried out to the basement works whilst the trial progressed. These all seem to being carried out by the same person. She could not initially recall the name. She said it was her builder from Brighton. Then after a long pause and checking her mobile phone address book, established that it was Mr El Jamal Ms Grigaite struck me as an intelligent lady who knew far more than she was letting on, and knew the Hamdans far better than she was prepared to admit. In conclusion, I find that when bidding at auction and completing the purchase Ms Grigaite knew that it was subject to forfeiture and enforcement proceedings. She intended to obtain the long lease and, it seems to me (I infer) was expecting to benefit from collective enfranchisement. She knew the sub-lease and flat had been granted and created in breach of covenant as one of the necessary building blocks to acquire the freehold. In purchasing, she was essentially doing Mr Hamdan What was Mr Andrawesimpressive witness. His witness statement was very short. He was a man of very limited means, being an editor of Al Hayat, a Middle Eastern newspaper. He had no explanation for where he got the purchase monies. He had no credible explanation for why he completed against the firm advice of his solicitors not to complete because he was buying a forfeitable sub-lease subject to enforcement proceedings, apart from saying that he was prepared to take the risk apart from losing the deposit (itself wrong). He had no sensible explanation for why or how the completion came to be so delayed (eight months later in June 2012) without some sort of connection with Mr Hamdan/the vendor. He said he needed time to raise the purchase monies so was prepared to pay an extra His only explanation for how he came to witness Mr Ferreirath August 2010 is that he just happened to bump into him whilst visiting the outside basement vaults with a friend but walking around the inside basement hall area and was asked to witness the document which, he said, was not an uncommon experience for him. His only explanation for Mr Hamdanth November 2011, three days before the auction, was that the email address was wrong Out of the blue on the second day of the trial it emerged that he had the previous week (or perhaps a few days previously) acquired flat 24 for In my judgment, Mr Andrawes did not come to tell the court the truth. Much of his evidence was incoherent. The rest of it made no sense. I find that he bought the sub-leases to flats 24 and 28 as nominee for Mr Hamdan and holds them on trust for him, likewise the nine vaults referred to. It is his function to hold those assets to frustrate enforcement by the Claimants and keep them free from creditors. In purchasing them, he knew that the sub-lease and flats had been unlawfully granted and created and most probably that the footprints did not match but simply did not care because (a) he was doing Mr Hamdan I also find that Mr Andrawes was aware of the fact that these flats had been unlawfully created so as to enable Mr Hamdan to exercise rights of enfranchisement. That is clear in respect of the section 42 notices because he admits intending to acquire its benefit. It is less clear in respect of collective enfranchisement, but on a balance of probabilities I infer from his connection with Hamdan associates, which goes back at least to August 2010, and his knowledge of Alleyn Court and the basement lay out that he was aware one way or another that the activities were directed at wrongfully obtaining the freehold from the Claimants. That in my judgment is sufficient for the Claimants to succeed against him in respect of the conspiracy element of the fifth claim. As a post script, I add that, again equally out of the blue, at the final hearing on 1st February 2013 it emerged from a letter from the Hamdansth September 2012. Orders th and 25th January 2013 It was in those circumstances that Ms Grigaite and Mr Andrews consented to final declarations in the fourth and fifth claim regarding the status of the sub-leases and flats and to a related injunction, with mirror declarations and orders being made in the third claim (reasons to be given later) with appropriate costs orders. I also made a final declaration of breach in the first claim with appropriate costs order leaving (due to the lateness of the hour) to specify the breaches which I did by order on 25th January 2013, with appropriate costs orders with reasons to be given later. Interim injunction th and 25th January 2013 To maintain the status quo until handing down of judgment, I acceded to the Claimants Due to the lateness of the hour, and it flowing naturally from the adduced evidence, full reasons were not given. However, the following were the principal factors causing me to order the interim injunction. First, the evidence adduced at trial established that Mr Hamdan (and the other original defendants) was (and were) prepared and able to (i) create assets (the sub-leases) directed at wrongfully appropriating the Claimants Secondly, Mr Hamdan fabricated documents, endorsing one with Central London County Court stamp, and evidence to mislead the Claimants and the court. The other original defendants, specifically Ms Hamdan, were content to use or at any rate try to use that evidence. There appeared to be no limit to which he/they would not go to achieve his/their ends. Thirdly, Mr Hamdan (and the others) repeatedly and flagrantly breached court orders, particularly important disclosure orders directed at revealing the real relationship between the original defendants, whether monies had changed hand and the source of various funds. Fourthly, Mr Hamdan and Ms Hamdan were adept at seeking to manipulate the court process in an attempt to avoid judgment, all the while racking up the other partiesvide they both made lat applications which were then withdrawn shortly before the final CMC; Mr Hamdan secured a Interim Order in his proposed IVA on 12th December 2012 without telling the court on 20th December 2012; having withdrawn her application to vacate trial before Christmas, she made the same application after Christmas. Fifthly, Mr Hamdan appeared to be in the process of re-arranging ownership of his assets to defeat creditors vide, for example, his IVA proposal (fact and content) to be viewed in tandem with the January 2013 sale (by Mr Al Rihany) of flat 24 to Mr Andrawes. There was in my judgment a real risk that the original defendants would dissipate assets so as to defeat the Claimantsth January 2013 when I expected to give judgment. In the event, that was adjourned to 1st February 2013 and the interim injunctions renewed until then. Mr Warrents appeared on 25th January 2013 with instructions limited to the interim injunction. Hearing st February 2013 At final hearing day was 1st February 2013 when final orders were made as well as interim charging orders and that granting of injunctions to prevent dissipation. Mr Levy QC and Mr Warrents appeared on behalf of the corporate defendants and Mr Hamdan and Ms Hamdan with instructions limited to the injunctions. APPENDIX ONE SCHEDULE OF FALSE STATEMENTS 4th June 2010 witness statement (in CI/LON/00BK/0201/004) On 4th June 2010 Mr Hamdan signed a witness statement by which he verified the contents as being true. Mr Hamdan made the following statements without an honest belief in their truth: That he had granted sub-leases of basement flats 24, 25, 26, 27, 28, 29 and 30 Alleyn Court were granted on 6th November 2009, 19th November 2009, 2nd December 2009, 26th November 2009, 10th November 2009, 29th November 2009 and 10th December 2009. This was false because they were not granted until sometime after 3rd March 2010. That he had sent a letter dated 10th December 2009 to Cluttons enclosing notification of those sub-leases and enclosing a cheque for th June 2010 when he purported to send a copy that letter to the Claimants 28th September 2012 witness statement On 28th September 2012 Mr Hamdan signed a witness statement by which he verified the contents as being true. Mr Hamdan made the following statements without an honest belief in their truth: That Mr Hamidi had converted the basement into a self-contained flat from which he was evicted in June 2008 when Mr Hamdan took possession as mortgagee in possession. This was false because it was Mr Hamdan who converted the basement into a self contained flat sometime between June 2008 and July 2009. That he had sent a letter dated 6th August 2009 to Mr Baynes which he had filed at Central London County Court who dated stamped it 7th August 2009 and copied to the Claimants and the Court Manager of Central London County Court. This was false because the letter had been fabricated sometime after issuance of these claims. The court stamps were fabricated. That sub-leases of basement flats 24, 25, 26, 27 and 28 Alleyn Court were granted on 6th November 2009, 19th November 2009, 2nd December 2009, 26th November 2009 and 10th November 2009. This was false because they were not granted until sometime after 3rd March 2010. That he had sent a letter dated 10th December 2009 to Cluttons enclosing notification of those sub-leases and enclosing a cheque for th June 2010 when he purported to send a copy that letter to the Claimants That works to complete the four basement flats 24, 26, 27 and 28 were completed in May 2010. This was false because the work did not start until 29th July 2010. That the works to the basement were carried out by contractor Hicham el Jamal employed by Remington Commercial Limited and Mrs Iman el-Rayes. This was false because it was Mr Hamdan who carried out the works and employed the contractor. 29th October 2012 witness statement On 29th October 2012 Mr Hamdan signed a witness statement by which he verified the contents as being true. Mr Hamdan made the following statements without an honest belief in their truth: That Mr Hamidi had converted the basement into a self-contained flat from which he was evicted in June 2008 when Mr Hamdan took possession as mortgagee in possession. This was false because it was Mr Hamdan who converted the basement into a self contained flat sometime between June 2008 and July 2009. That he had sent a letter dated 6th August 2009 to Mr Baynes which he had filed at Central London County Court who dated stamped it 7th August 2009 and copied to the Claimants and the Court Manager of Central London County Court. This was false because the letter had been fabricated sometime after the issuance of these claims. The court stamps were fabricated. That sub-leases of basement flats 24, 25, 26, 27 and 28 Alleyn Court were granted on 6th November 2009, 19th November 2009, 2nd December 2009, 26th November 2009 and 10th November 2009. This was false because they were not granted until sometime after 3rd March 2010. That he had sent a letter dated 10th December 2009 to Cluttons enclosing notification of those sub-leases and enclosing a cheque for th June 2010 when he purported to send a copy that letter to the Claimants That works to complete the four basement flats 24, 26, 27 and 28 were completed in April and May 2010. This was false because the work did not start until 29th July 2010. That the works to the basement were carried out by the sub-lessees. This was false because it was Mr Hamdan who carried out the works and employed the contractor. APPENDIX TWO El JAMAL SCHEDULE OF FALSE STATEMENTS On 22nd September 2012 Mr Hicham El Jamal signed a witness statement by which he verified the contents as being true. Mr El Jamal made the following statements without an honest belief in their truth: That he converted the basement at Alleyn Court into four flats in April and May 2010 and that he was on site every day. This was false because the work did not start until 29th July 2010. That he was employed by Remington Commercial Limited and Mrs Iman el-Rayes. This was false because he was employed by Mr Micha ANNEXURE Owners of other flats within Alleyn Court and their solicitor 1 Mr Bennett Mark Edward Hurley Bennett, flat 5, indirectly interested in flats 2, 4 and 11 2 Ms Chambers Anne Chambers, flat 19, solicitor and partner at Parfitt Cresswell 3 Mr Driver Robert Leonard Driver, flat 10 Non-Hamdan tenants 4 Mr Fleming David Michael Fleming, partner in William Heath & Co Claimants 5 Mr McKeown Mark Edward McKeown, residential property manager 6 Ms Whyte Laura Jennifer Orrill Whyte, residential assistant manager Claimants 7 Mr Baynes Nicholas Patrick Baynes, Cluttons LLP 8 Mr Heffron Martin Charles Earnshaw Heffron, chartered surveyor, Cluttons LLP 9 Mr Dharmasena Jeremy Rohan Dharmasena, chartered surveyor, Knight Frank LLP 10 Mr Lane Simon Lane, structural engineer, Taylor Whalley and Spyra 11 Mr Lilley Benjamin Scott Lilley, chartered surveyor, Knight Frank Claimants 12 Mr Highmore Robert Peter Highmore, partner Charles Russell LLP 13 Ms McGoldrick Jessica Jane McGoldrick , solicitor Charles Russell LLP 14 Mr Shapiro Paul Richard Howat Shapiro, solicitor, Charles Russell LLP 15 Ms Dalal Ruby Dalal, associate, Charles Russell LLP 16 Mr Marsh Andrew William Marsh, solicitor, RadcliffesLeBrasseur 17 Ms Usher Alison Ruth Usher, RadcliffesLeBrasseur 18 Mr McBurney Martin McBurney, paralegal, RadcliffesKeBrasseur Westminster City Council 19 Mr Lashkariani Hassan Lashkariani, Senior Building Control Officer 20 Mr Sone Martin Daniel Sone, Planning Enforcement officer