Stuart
Hornett

Stuart has appeared in numerous reported and significant cases in the commercial chancery field and has advised and acted on substantial company, banking insolvency and shareholder disputes. He is currently acting in a long running partnership/company claim with international aspects; acting for bank in complex s.944 claim; advising in a number of large claims against banks and administrators concerning collapsed property developments and acting for the ex-Chairman of BHS in connection with the Arcadia takeover and liquidator claims. Stuart recently acted for a group of investments funds in a large claim concerning mismanagement, breaches of fiduciary duty and constructive trusts and has appeared in a number of international arbitrations concerning recovery of loans to Russian based clients.

Notable cases include:

Singh v Jhutti [2021] EWHC 2272 (Ch) Leading Tom Frazer (Selborne Chambers) in a 3 week Ch D trial, Stuart successfully defended a claim concerning the ownership of a multi-million pound portfolio of c.30 properties. The case involved allegations of fraud and forgery; enforcement of contracts of sale; interplay between constructive trusts and s.1 of the 1989 Act; specific performance and laches.

Al-Najjar v Majeed and others [2022] EWHC 363 (CH); [2022] EWHC 686 (Ch) Stuart is currently acting for claimants in a £5m+ partnership dispute relating to property developments in London and Slough, including breach of trust and fraud claims. Having obtained a striking out and debarring order in January 2022 before Leech J. [2022] EWHC 363 (CH), judgment was obtained at trial [2022] EWHC 686 (Ch). The proceedings are now concerned with recovery and enforcement, including freezing injunctions against non-party “Chabra” respondents, including offshore entities.

BHS Group (in liquidation) v Smith and others (ChD) Stuart (leading Daniel Webb of Selborne Chambers) is currently acting for the ex-Chairman of BHS Group defending claims exceeding £150m brought by the liquidators against a number of former directors. The claims are for misfeasance and breaches of directors’ duties in relation to high value property related transactions and a wrongful trading claim under IA s.214 involving multiple allegations of trading whilst insolvent, pension and VAT issues. The matter is listed for a 6 week trial in October 2023.

Badyal v Badyal Stuart originally acted in a 3-week Chancery trial [2018] EWHC 68 (Ch) for the successful Second Defendant in resisting a petition under s.994 CA 2006 and establishing that many UK and Indian companies and assets worth many £10ms were partnership property or held on trust. The case involved serious allegations and counter-allegations of fraud, breaches of directors’ duty and setting up competing businesses, all of which Stuart succeeded on at trial and on which he recovered indemnity costs. The case has led to numerus heavy applications, including injunctions and share transfers orders in the face of a competing Indian injunction [2019] EWHC 467 (Ch); debarring orders [2019] EWHC 2679; relief from sanctions and applications for pre-dissolution distributions [2019] EWHC 3423 (Ch)

Re Brickvest Limited  [2019] EWHC 2662 (Ch) [2019] EWHC 3084 (Ch). In this on-going matter, Stuart is acting for a German bank on various disputes arising out of its investment in start-up technology company and its subsequent administration, including a complex s.994 petition and various injunctions obtained to restrain the directors from issuing shares and loan notes and to correct misleading filed accounts.

Re Paramount Powers [2019] EWCA Civ 1644; 2020 B.C.C. 152. Stuart successfully resisted an appeal against the refusal by the trial judge to make a just and equitable winding up order under s.122(1)(g) IA 1986. The case involved a detailed analysis of the authorities concerning the analogy with partnership concepts, clean hands and winding up being a last resort.

Ford v Bennett  [2019] EWCA Civ 1604; [2020} Costs L.R. 1472. Stuart acted for the Appellant on this appeal from complicated costs order made by the Judge in the Bennett trial (below), the key issue being whether indemnity costs should have been awarded and the extent to which the Additional Parties and Defendant joined in common cause. The Court of Appeal remarked on the “decent and attractive case” made by Stuart.

Re: Chudnosky (2019). This was a a complex multijurisdictional $80m breach of trust/fraud claim in the BVI in which Stuart acted with Romie Tager QC. It concerned various fraud and breach of trust claims and a novel application for a double derivative claim in the BVI.

Bennett v Bennett & Otrs [2018] EWHC 1931 (Ch) Stuart acting for the Additional Parties in a 12 day trial before George Bompas QC (ChD) about the ownership of a football club worth c.£10m. The issues were whether there was an oral agreement about ownership; whether there was a partnership or constructive trust; the extent of and reasons for the clients’ contributions to the club and laches/delay.

Hameed v Packe [2018] EWHC 3061 (Ch) This was a 5 day trial of a partnership dispute concerning the dissolution of 2 partnerships relating to properties  and property development; whether properties belonged to the partnership; when the partnerships were dissolved and on what basis. The taking of the accounts and further issues for trial are proceeding before the Master.

Arbitration S v A  (2018) This was a 2 day ICC arbitration in Paris concerning liability and quantum ($2m+) for alleged breach of contract for the supply of oil pipeline machinery. I acted for the Saudi supplier, the Chinese claimant was represented by a Beijing law firm. The case was conducted in English but was particularly challenging because the law of the forum was French and the law of the contract was Chinese.

Carrasco v Johnson [2018] EWCA Civ 87. Stuart acted for the Appellant in this important Court of Appeal decision on the proper approach to awarding statutory interest to individuals. This was the first occasion that the Court of Appeal reviewed and approved the leading first instance authorities on the issue, Challinor v Juliet Beliis & Co [2013] EWHC 620(Ch) and Reinhard v Ondra LLP [2015] EWHC 2943 (Ch) and the approach taken of broadly “categorising” claimants into those who would have borrowed and those who would have left the money on deposit. The case emphasis the restitutio principle for awarding interest and the limits to the factual enquiry which the first instance court should undertake when determining the appropriate rate.

Havering Radio Cars v Phillips [2017] EWHC 614 (QB).   – Barker Gillette – Stuart recently acted at trial for the successful claimants in a claim for breach of fiduciary duty and contract, securing a multi-million pound award of damages and declaratory relief. The case has been the subject of various articles looking at the limits of the Pallant v Morgan trust.

Mellor v Partridge – Instructed by CMS Cameron McKenna, Stuart acted for David Mellor in £4m fraud claim arising out of the misselling antiques. The case involved complex issues of accounting, causation and loss

National Westminster Bank Plc v Alfano [2012] EWHC 1020; [2013] EWCA 1703. Stuart acted for the successful bank at first instance and in the Court of Appeal in a case concerning the enforceability of personal guarantees. The case raised legal points on the conditionality, dating and delivery of deeds.

Levin v Tannenbaum (2013) Stuart acted for the claimant in a £45m claim under a series of guarantees which are said to be forgeries. The claim raises issues of estoppel, holding out, agency and limitation and was the subject of two recent judgments of Nugee J. on 18 November 2013 (LTL 19/11/2013 ref AC9401436) on the Defendant’s unsuccessful strike out/summary judgment application.

JSC BTA Bank v Solodchencko & Ors (2011/2012) Stuart was instructed on behalf of Eastbridge Capital in one of the cases making up the largest commercial fraud proceedings in the Commercial Court and Chancery Division and featured as a “Top 20 case of 2011” in The Lawyer (see http://www.thelawyer.com/top-20-cases-of-2011/1006498.article). The case concerned allegations of fraud against former directors of BTA JSC Bank of Kazakhstan worth in excess of $1.5bn. Stuart appeared on freezing, search order and other applications in the Chancery Division and Commercial Court.

Kearns Brothers Ltd v Hova Developments Ltd [2012] EWHC 2968 (Ch) Stuart represented the successful Claimant in a claim under a Pallant v Morgan constructive trust in a joint venture for the development of land. The case clarifies points of law on what type of interest in land the claimant needs in order to satisfy the Banner v Luff test.

Centrehigh Ltd v Karen Amend & Ors [2013] EWHC 1448 (Ch). Acted for applicant in a long running and complex third party costs application under s.51 SCA.

Innovatis Investment Fund Limited v Ejder Group Limited (Ch) [2010] EWHC 1851
Acted with Romie Tager Q.C in obtaining judgment at trial for over US$4m under a disputed securities repurchase agreement agreement concerning a Lehman Bros Medium Term Basket Note with a face value of US$7m. The case also engaged issues of an agent’s liability under a contract in the context securities trading.

In Re 4Ing v Harper and Others (Ch) [2010] BCC 746; [2010] Bus LR D58. Acted for the relatives and connected companies of a principal defendant in an £8m fraud case and the Claimant’s application for relief under section 423 of the Insolvency Act 1986 in relation to real property and other assets in the UK and Guernsey.

Re Cotswold Company Ltd (Ch) [2009] BCC 812; [2009] 2 BCLC 371; [2009] L&TR 22 Acted for landlord in successfully challenging the decision of a supervisor of a CVA in a claim for future rents and liabilities under a commercial lease. The case concerned the effect of a subsequent deed of surrender on a claim which had already been compromised by the CVA and whether the terms of the surrender were sufficient to reserve the claim for future rents.

Mitchell & Hobbs (UK) Ltd v Mill [1996] 2 BCLC 102. 
Validity of legal proceedings authorised by company; power of director to direct legal proceedings on behalf of company.

Stuart has also appeared in a number of important cases concerning practice and procedure including the leading Court of Appeal cases of Audergon v La Baguette [2002] EWCA Civ 10; [2002] C.P.Rep 27 on review or rehearing on appeal; Goode v Martin [2002] 1 W.L.R. 1828; [2002] 1 All ER 620 concerning amendments outside the limitation period and Art6 HRA and the recent decision of Morgan J. in Centrehigh v Karen Amen & Ors [2013] EWHC 625 (Ch) concerning cross examination and summary procedure in third party costs applications.

Stuart has acted in a number of significant commercial landlord and tenant cases. He has advised pension funds and a major supermarket on property matters and a London local authority on matters arising out of Crossrail.

Stuart acts and advises in many professional liability and negligence claims, particularly in commercial and property related matters, including TCC and arbitration claims. He recently appeared for the successful defendant in a large fire claim concerning indemnity issues (UMA v GM welding below). Stuart is currently acting on a £10m solicitor’s negligence action concerning the securitization of a large property transaction and a valuer’s negligence claim worth £15m on behalf of the Administrators of an Icelandic Bank.

Notable cases include:

United Marine Aggregates Ltd v GM Welding & Engineering Ltd (CA) [2013] EWCA Civ 516 on appeal from Edwards-Stuart J [2012] EWHC 779 (TCC). Stuart successfully defended a negligence and liability claim arising out of a fire at an aggregate processing plant involving complicated questions of fact and causation, as well as the proper construction of insurance warranties. The decision was upheld on appeal.

Cairns v Christie & Co. (2009) Acted for a successful Claimant in a rare recorded decision in which a party has recovered damages in negligence against an independent expert appointed jointly by the parties to carry out a valuation, in this instance, the valuation of freehold licensed premises pursuant to an option in a lease.

Vision Golf Ltd v Weightmans (a firm) (Ch) [2005] 1675 EWHC
[2006] P&CR DG13. Acted for successful claimant in a case concerning solicitor’s failure to apply promptly for relief from forfeiture by peaceable re-entry; whether breach caused any loss; whether an application for relief made after 6 months by a second firm of solicitors under the equitable jurisdiction would have succeeded; whether parallel lease also forfeited and whether it was lost as a result of the solicitor’s negligence.

Triodos Bank NV v Dobbs & Ors v Grant Thornton (Ch) [2004] EWHC 845 Successfully defended administrators against a negligence action involving allegations of disposing of UK property and US shares at an undervalue. Subsequently acted on action under undertaking in damages in [2005] EWHC 108 which involved issue of mitigation and share purchases.

Stuart’s property practice encompasses a wide area of real property issues, including mortgages (he is a contributing editor of Cousins, the Law of Mortgage), land registration, options, overage clauses and valuation issues. He has acted in a number of boundary disputes involving residential and commercial property and in cases concerning freehold restrictive covenants. Stuart has recently advised a London University in relation to the removal of a registration as an Asset of Community Value under the Localism Act and has acted for a number of Midlands Universities on option and development issues. Stuart regularly acts for developers and is completely familiar with development agreements and all their complexities, in particular reasonable and best endeavours obligations.  

Notable cases include:

Singh v Jhutti [2021] EWHC 2272 (Ch) Leading Tom Frazer (Selborne Chambers) in a 3 week Ch D trial, Stuart successfully defended a claim concerning the ownership of a multi-million pound portfolio of c.30 properties. The case involved allegations of fraud and forgery; enforcement of contracts of sale; interplay between constructive trusts and s.1 of the 1989 Act; specific performance and laches.

Biggs v Countryside Developments (2016) Ch Div. Represented the claimant landowners in a highly complex claim against developers in relation to a reasonable endeavours clause in the context of a Planning / s.106 Agreement for a £100m + residential development (settled)

Paddington Basin Developments Ltd v West End Quay Estate Management (Ch) [2010] EWHC [2010] 1 W.L.R. 2735; [2010] L&TR 26 [2010] 2 EGLR 35 , Stuart represented some 460 residential underlessees in the Paddington Basic Development an important action to determine whether an Estate Management Deed was Qualifying Long Term Agreement under the Landlord and Tenant Act 1985 and therefore subject to the statutory consultation provisions. In one of the very few High Court cases ever to consider the relevant statutory provisions, the Court held that the Deed was a Qualifying Agreement. The case is notable for its discussion of the policy behind the statute and an analysis of types of agreement that will and will not fall within the definition of Qualifying Long Term Agreement.

Hildron Finance v Sunley Holdings (Ch) [2010] EWHC 1681 [2010] 3 EGLR 1 Featured case with commentary in Vol. 1040 Estates Gazette 9/10/10. Acted for successful defendant at first instance and respondent on appeal in defending a claim under an overage agreement and the frustrating effects of the Leasehold Reform Act 1993 (applying the long line of authorities from Baily v De Crespigny).

Lyndendown Ltd v Vitamol Ltd CA [2007] EWCA Civ 826; [2007] 3 E.G.L.R. 11; [2007] 47 E.G. 170; [2007] 29 E.G. 142 (C.S.); [2007] 29 EG 142 Stuart acted for the successful defendant / subsidiary of a plc at first instance and in the Court of Appeal in a claim for damages for disrepair at the end of the term on the basis that because there was a 1954 Act protected sub-tenant holding over, damage to reversion was nil or nominal (applying Family Management v Gray). The existence of a side letter containing various assurances and an indemnity from the tenant’s parent company did not alter the position.

Northbrook v Abbey Estates Limited (CA) (2009) 
Acted for successful claimant seeking the return of a deposit for property purchased at auction on the basis of misrepresentation; implied covenants to title and vacant possession. Lloyd L.J. ruled that the common auction conditions did not exclude liability for positive misrepresentations.

Bruntwood v British Telecom (Ch) (2008) Acted for British Telecom in week long trial defending a multi-million pound terminal dilapidations action. The case engaged difficult issues of supersession in the context of section 18 of the Landlord and Tenant Act.

Stuart regularly advises and acts in probate, wills and trust matters. He is currently acting in a family dispute concerning a multimillion property portfolio involving disputed wills and trust claims; a claim under the Inheritance (Provision for Family and Dependents) Act 1975 with a related claim for rectification of a life insurance trust deed and a claim for possession and sale of a large residential property in a family dispute where capacity is in issue.

Stuart recently appeared in the High Court and Court of Appeal in Josife v Summertrot Holdings [2014] BPIR 1250, a case concerning capacity in the context of the grant of a guarantee; and in M v M (Fam D.) a claim for an injunction and specific performance to enforce a family settlement.

Stuart is ranked as a leading junior in all aspects of his practice:

• Leading Junior in Commercial Litigation, Legal 500 (2010 – current)
• Leading Junior Chancery Commercial, Chambers & Partners (2010- current)
• Leading Junior in Property Litigation, Legal 500 (2005 – current)
• Leading Junior in Real Estate Litigation, Chambers & Partners (2006 – current)