Richard Sandor Frischmann v Vaxeal Holdings SA & Ors

JUDGE PAUL MATTHEWS:

1. This is my judgment on an application made by the third defendant originally by an undated application notice which was sent to the court on 6 March 2026 and subsequently by a formal application notice in Form N244, issued on 10 March 2026. In each case the application was for an order varying the order of Richards J dated 9 January 2025 which had required the surrender of the third defendant’s passport to the claimant’s solicitors, and the variation was to allow it to be released temporarily to him so that he could travel to Spain.

2. On 12 March 2026 this matter came before Fancourt J who ordered that it be heard urgently at an application by order with a time estimate of half a day. The application is supported now by three witness statements, one dated 5 March, the second dated 9 March, and the third dated 17 March 2026 (yesterday) -- each made by the third defendant, and, in the second and third cases, each with one exhibit. The application is opposed by the second witness statement of Mr Jan Mogewa who is the claimant’s solicitor, dated 16 March 2026, with one exhibit.

3. The application was made in the context of a claim which was begun by claim form and issued on 17 March 2021 against three defendants. The claimant subsequently issued an application by notice dated 1 June 2022 for summary judgment in this claim. On 3 November 2023 Master McQuail made an order granting summary judgment against the second and third defendants. In the case of the second defendant this was for £1.095 million together with £1.077 million interest. In relation to the third defendant, it was in the sum of £185,628, together with interest at 12 per cent per annum. I note in passing that it appears that the third defendant is the sole director of the second defendant.

4. Subsequently, on 12 January 2024, Master McQuail made an order repeating the terms of the summary judgment, but also dismissing the application to vary the order and refusing permission to appeal. She also ordered that the second and third defendant should pay the costs of the claimant to the claimant and, in particular, should pay £105,000 on account of those costs. I mention in passing that none of these sums has so far been paid. The second and third defendants had been represented by solicitors. On 18 January 2024 Master Clark made an order that those solicitors had ceased to represent them.

5. On 25 April 2024 Deputy Master Dovar made an order requiring the second and third defendants to disclose their assets, and in particular ordered the cross-examination of the third defendant on his assets. A hearing for the cross-examination of the third defendant was fixed for 23 July 2024. On that day, however, Master McQuail made a further order, certifying the third defendant’s failure to attend at and submit to the cross-examination or to give disclosure as to assets. She ordered the matter to be referred to a High Court judge.

6. On 17 October 2024 (but I think the order was amended under the slip rule a few days later) Adam Johnson J made an order committing the third defendant to prison for contempt of court, suspended so long as the third defendant attended before the Master on the further listed examination. This was listed for 10 December 2024. However, the third defendant again did not attend, and on that day Master McQuail certified that the third defendant had failed to comply with the suspended committal order.

7. In consequence of that, Adam Johnson J signed a warrant of committal on 13 December 2024, committing the third defendant to prison for 28 days. He was in fact arrested at London Gatwick Airport on 31 December 2024 pursuant to the warrant, and committed to Lewes Prison. Because he had to serve only half the sentence, he was released on 13 January 2025.

8. In the meantime, however, on 9 January 2025 Richards J, on the claimant’s application but without notice to the defendants, made a worldwide freezing order against the third defendant. In addition to that, an order was made prohibiting the third defendant from leaving England and Wales and requiring him to deliver up all his passports and travel documents. The court also made a ports alert order. The order was served that same day on the third defendant in Lewes Prison.

9. The return day was 23 January 2025. However, on 22 January 2025 Richard Smith J vacated the hearing for the following day and adjourned the return date on the injunction to 30 January 2025. In the meantime on 29 January 2025 the third defendant petitioned for his own bankruptcy. This followed the service on him of a statutory demand on behalf of the claimant. On 30 January 2025 Trower J made an order continuing the worldwide freezing order and the prohibition on leaving England and Wales, including an “all-ports” warning, and also made an order for the disclosure of the third defendant’s assets.

10. On 10 February 2025 the third defendant was adjudicated bankrupt on his own petition. On 14 March 2025 the claimant applied for an order annulling the bankruptcy. After a number of adjournments, this has yet to be heard. It has now been listed for hearing on 1 June 2026. On 2 April 2025 Trower J continued the order for an “all-ports” warning for a further 12 weeks. On 10 February 2026 the third defendant was automatically discharged from his bankruptcy. That was following the expiry of the statutory period of one year.

11. In summary, therefore, the cross-examination and disclosure order was made on 25 April 2024, following the summary judgment given in November 2023 against the second and third defendants. The third defendant did not attend the hearing listed for cross-examination. Consequently, as I have already said, the court made the order of 9 January 2025 for a worldwide freezing order and a passport order. Even after all this time, the third defendant still has not complied with the disclosure order, and the hearing for the cross-examination still has not been relisted.

12. On 5 March 2026 the third defendant emailed the claimant’s solicitors requesting the release of his passport, in order to visit and look after his former wife now living in Spain, on the basis that she was seriously ill following pneumonia. He did not say so in that email, but in fact it now appears that the pneumonia concerned had happened a year before. On 6 March 2026, without waiting for any response, he sent an application notice, not in Form N244, and a witness statement, not in the CPR form required, to the court seeking such an order. As it happens, on the same day the claimant wrote back to the third defendant seeking further information and documentation about his request and in particular details of the travel arrangements, the funding for the travel arrangements and for his living in Spain in the meantime. But the third defendant did not reply.

13. On 10 March 2026 the third defendant filed a fresh application notice in form N244, supported by a new witness statement dated 9 March 2026. That witness statement supplied some limited information about the third defendant’s discharge from bankruptcy on 10 February 2026. It also said that their daughter Robyn, who lives in Barcelona with her partner, had been informed by the doctors that her mother had stomach cancer which might have spread elsewhere. The statement also attached as an exhibit a very short certificate in Spanish, according to which it was certified that the third defendant’s former wife had been admitted to a hospital in Marbella on 7 March 2026 and that she was still there at the date of the certificate, 9 March 2026. However, no other documentary information was given as to the former wife’s medical condition, her prognosis, her particular needs or anything else. Of course, it was limited in time to 9 March 2026. I should also add that the translation into English of the certificate of the Spanish hospital is inaccurate, in the sense that some significant parts of the information contained in the English translation are not contained in the Spanish original. This is not made clear in the translation.

14. Also on 10 March 2026 the third defendant emailed the claimant’s solicitors for copies of the orders of 25 April 2024 and 30 January 2025. The same day the claimant’ solicitors responded, referring to the outstanding matters which had still not been addressed by the third defendant. The following day the claimant’s solicitors wrote again to the third defendant, requesting a response to those outstanding issues and confirming that, according to the solicitors’ own information, no application notice had been issued by the third defendant or listed by the court. The third defendant replied the same day, but only to the claimant’s letter of the day before.

15. On 12 March 2026 the third defendant sent an email to the claimant attaching a skeleton argument and insisting that the matter would be heard before the court that day. In fact, when the matter came before the Applications Court on that day, Fancourt J instead ordered that the application should come on urgently, as an application by order, in the following week, and that is the listing before me now.

16. At the outset of the hearing this morning I was presented, on behalf of the third defendant, for the first time with a file containing a new (and detailed) skeleton argument, various authorities, the third witness statement made yesterday, and its exhibit. I adjourned for an hour to read them. The new evidence includes a hospital report dated 17 March in Spanish but with an English translation apparently produced by AI. It lists what it calls “diagnoses” although to me (as a former coroner), with the exception of the second, they seemed more like symptoms, which might be interpreted to produce a diagnosis. They were: right pleural effusion; progressive breast cancer (but this has been a known condition for some years back); anaemia, elevated inflammatory markers; mild hyponatremia; paroxysmal atrial flutter. It also mentions waiting for pathology of a skin lesion to be reported. There is no mention, let alone diagnosis, of stomach cancer, or indeed any new cancer. Nor is there any suggestion that Mrs Samuelson is in the terminal phase of her life.

17. I turn therefore to consider briefly the relevant law. A so-called passport order can be made under section 37(1) of the Senior Courts Act 1981 : see Sir Nicholas Patten in Lakatamia Shipping Co Ltd & Ors v Su & Ors [2021] EWCA Civ 1187 , [3]. However, there is a need to demonstrate a real risk on the evidence before the court that the defendant -- and this is put two ways -- either will leave the jurisdiction and not return (Floyd LJ in JSC Mezhdunarodny Promyshlenniy Bank v Pugachev [2015] EWCA Civ 1108 [45]) or (from Bean LJ in the same case at [68]) will leave this country in order to frustrate the court’s processes.

18. If a passport order is granted, it should be granted for the minimum time necessary to achieve its purpose (see Lakatamia [4] and [6]), but it is not a proper purpose of a passport order to put pressure on the defendant to pay a judgment debt (see Lakatamia [5] and Umbrella Care Ltd (In Liquidation) v Raja [2024] EWHC 197 Ch [28]). These cases also establish that the defendant can apply for a variation of the order but must first establish hardship, and the court will conduct a review of the proportionality of the order.

19. Of course, a direction whether to continue or to discharge a passport order is an exercise of judicial discretion, taking account of all the circumstances (see Lakatamia [42]) but mere delay caused by the defendant refusing to comply with orders under process which the passport order is designed to facilitate is not a good reason to discharge a passport order. On the contrary, doing so would enable a contemnor to benefit from his own misconduct (see Lakatamia [41]).

20. Therefore, so long as there is a significant purpose to be served in the insolvency process which will be materially prejudiced by, in that case, Mr Raja fleeing the jurisdiction, there are grounds for keeping him here ( Umbrella Care v Raja , [36]). It is trite law that an injunction cannot re-write the law of insolvency or indeed improve a creditor’s position in an insolvency: see Iraqi Ministry of Defence v Arcepey Shipping Co SA (The Angel Bell) [1981] QB 65 , at 71-72 per Robert Goff J (as he then was). The discharge of a debtor from bankruptcy releases the debtor from provable debts. But creditors of provable debts remain creditors able to prove in the bankruptcy. The passport order does not alter the claimant’s position in the bankruptcy.

21. The third defendant also referred to the decision of Richard Salter QC, sitting as a deputy judge, in Eco Quest Plc v GFI Consultants Ltd [2014] EWHC 4329 (QB) , where he said: “83. However, despite my initial misgivings, Mr Prentis has been able to persuade me that the position is more nuanced than the general principles that I have mentioned might on their face suggest. I accept Mr Prentis’s submission that the Court’s jurisdiction to grant an injunction whenever it appears ‘to be just and convenient to do so’ is unfettered: and that, while it will usually be appropriate to discharge a freezing injunction on the making of an administration, winding up or bankruptcy order, so that the defendant’s assets can be applied in accordance with the statutory scheme, there may be some circumstances in which that is not the ‘just and convenient’ course. “84. Having considered the authorities cited in Gee, Commercial Injunctions at [paragraph] 3.007, I am satisfied that the true position as stated there is that a freezing injunction: ‘... can ... be maintained in force, even after a winding up order or a bankruptcy order has been made, provided that its purpose is to preserve the assets held by, or for, the defendant, for the creditors as a whole...” That is all I want to say about the law at this stage.

22. A question then arises as to the precise scope of the third defendant’s application today. The application notice itself refers only to an application for an order varying the passport order of 9 January 2025. However, the third defendant’s skeleton argument prepared originally for the hearing on 12 March 2026, which of course did not take place, also referred to an application to stay both the passport order and the worldwide freezing order of 30 June 2025. That application was said to be made under CPR 3.1 and/or the Insolvency Act 1986 , section 265 , on the basis that the third defendant was now a discharged bankrupt. This is enlarged upon in the third defendant’s more detailed skeleton today, though Mr Tannock for the third defendant was at pains to say that he accepted that the application before me today was simply for the variation. But he wanted me to take into account points which were made in the skeleton argument as part of the overall circumstances.

23. The evidence filed in this matter does not cover the wider issues which might be raised by other applications, and of course in fairness the claimant is entitled to consider its position and file evidence in relation to any such other matters. In my judgment, it is not in the interests of justice for me to go any further or wider today. At any time, the third defendant is able to issue an application notice with evidence in support for an order staying or setting aside the earlier orders. I am proceeding, therefore, on the basis that what is listed before me is simply the application by the third defendant seeking a variation of the passport order.

24. Turning then to the matters before me, I note first of all that the third defendant is still subject to the disclosure orders contained in the order of Trower J of 30 January 2025 which have still not yet been complied with. Once these orders have been complied with, the claimant will be able to list the cross-examination hearing. That will of course be for the third time, as the third defendant did not attend on the first two occasions. I bear in mind that a Part 71 cross-examination is not enforcement proceedings: see, for example, Punjab National Bank v Nanda [2023] EWHC 3201 Ch .

25. In my judgment, the passport order can still be employed, and still has material purposes to perform, that is to say preventing the third defendant from leaving the jurisdiction before the disclosure orders and the cross-examination order have been complied with. The fact that the cross-examination order dates from as long ago as 25 April 2024 is not a good reason to discharge it now with its purposes still unfulfilled. On that, see, for example, Rajah J in Umbrella Care .

26. It is also necessary to bear in mind the jurisdictional mobility of the third defendant. He is undoubtedly connected to several jurisdictions. His ex-wife and one of his daughters live in Spain. He is the director of Gibraltar companies. In the past he has given his own residential addresses as both in Switzerland and in Ireland. More recently he has given several residential addresses for himself in England, including Chislehurst, Weybridge, and now Deptford in London. I bear in mind also that he is a sophisticated user of offshore trusts and companies. He has so far refused to give information or answer questions about his assets. In my judgment, there must be a real risk that he will flee the jurisdiction in order not to have to do so.

27. The third defendant asserts at paragraph 19 of his first witness statement, made on 5 March 2026, that he has “complied with the court’s orders”. This is patently untrue. He may have complied with some or parts of some of the orders of the court, but he has certainly not complied with all of them. Moreover, such non-compliance has led to committal proceedings, and indeed on one occasion a prison sentence. He still has not complied with the disclosure orders which will lead to the cross-examination hearing, for the purposes of which the passport order was made. He has given inconsistent evidence in these proceedings, for example as to where he lives (and does not live) at any particular time. It is clear that he has lied when it suited him. In these circumstances, I cannot trust the third defendant to obey any court orders. His undertakings to the court will carry no weight. The only thing that keeps him in this jurisdiction is the passport order.

28. The third defendant’s request for the return of his passport is said to be based on his need for it in relation to the medical emergency of his former wife, Mrs Samuelson. But he and Mrs Samuelson separated as long ago as 2001 and have since been divorced. Moreover, the third defendant accepts that he still owes her £1 million and interest under the divorce agreement. He is her debtor. It is difficult to see why Mrs Samuelson’s condition should be of such concern to the third defendant. There is certainly nothing from Mrs Samuelson to say that she requires her former husband’s attendance (or even knows of this application). Even if Mrs Samuelson’s condition were of such concern to the third defendant, until today the third defendant had put no evidence whatever before the court of Mrs Samuelson’s current medical condition or of her prognosis, except his own layman’s assertion. He has not even referred to the sources of any assertions that he made as to her condition. The only objective evidence before the court until today was that of the very brief certification of her admission to hospital. Even now, all that the court has is a report giving details of symptoms, but no diagnosis of any new diseases.

29. I am in no doubt that Mrs Samuelson is ill and that indeed the hospital is the best place for her, but that is as far as it goes. Nor is there any convincing evidence as to why the presence of Mr Samuelson alone is needed, given that Mrs Samuelson is now in hospital where she is being looked after and their daughter Robyn is with her -- and Robyn also has a partner. Moreover, Mr and Mrs Samuelson have at least one other child, Lucy, of whom nothing is said at all. There is no explanation why she could not go to Spain to assist her own sister and her own mother. The only evidence in effect before the court of any need for the third defendant to attend Mrs Samuelson in Spain has been the bare assertion of the third defendant alone.

30. The third defendant says that Robyn, the elder daughter, is suffering from bipolar disorder and cannot work or drive. But there is nothing from Robyn herself to say that she cannot cope (or even that she knows of this application). Last Easter Mrs Samuelson was hospitalised for four weeks. Robyn coped. It appears that the third defendant prepared a similar application to the present for a variation last year, but did not in fact use it. I accept, of course, that circumstances may change, but the evidence to persuade me of such a change from Robyn, Lucy and Mrs Samuelson is entirely lacking. There is no evidence that Mrs Samuelson is part of the third defendant’s family life. There is no evidence of recent contact, of any recent visits or any financial support by the third defendant of his former wife. There is certainly in my judgment nothing sufficient to engage Article 8 of the European Convention on Human Rights, the right to respect for family life. Even if Article 8 had been engaged, in my judgment the case would have been covered by Article 8(2) in that the order made here would be a proportionate one in accordance with the law for the protection of the rights of others.

31. In my judgment, looking at the matter overall, I consider that there is a real and significant risk that if the third defendant has his passport he will leave the jurisdiction and not return, despite any undertaking to the contrary. Secondly, in my judgment, no sufficient evidence has been placed before the court of any pressing need for the third defendant to have his passport. He has not established any sufficient hardship to outweigh the need to hold the ring until the disclosure orders and the cross-examination orders have been complied with.

32. Moreover, I remind myself that, all the way through this case, the third defendant has been in a position to avoid all of these problems, simply by complying with the orders of the court, and ultimately attending for cross-examination. This could have been done years ago. He has chosen not to do so. If that causes him any inconvenience now, then he has only himself to blame. The application is dismissed. LATER Judgment on Costs

33. Ms Powers asks for costs in principle. I am not yet dealing with detail. Mr Tannock, on behalf of the third defendant, says that the order for costs if made should be one which is in the annulment application, ie linked to and within that annulment application, conditional effectively on the success of the claimant’s application. I do not agree with that. It is a self-standing piece of litigation. There is no necessary linkage and therefore it is not costs in the annulment; it is costs in any event.

34. In relation to the basis upon which the costs are sought, Ms Powers has asked that the costs be assessed on the indemnity basis because this application has been conducted in a way which is outside the norm. I agree with her. To serve the bulk of the evidence, the only evidence that made any kind of impact, right at the last moment, so that in fact I did not see it until it was handed to me in court this morning, is completely out of the norm, and entirely justifies an award of costs on the indemnity basis. LATER

35. I think this is an unusually heavy piece of litigation which required a great deal of effort and skill to be done very quickly and I think I should allow the hourly rate of £550. Whether I do so by calling this very heavy litigation or whether I do it by saying there is a good reason to depart from the rate, I think is neither here nor there. I will allow those hourly rates. Since Mr Tannock does not want to challenge anything else, and I have cast my eye over it and I can see no good reason for interfering with what is sought here, I shall assess summarily the costs at the figure in the statement -- that is a total of £21,317.50. Digital Transcription by Marten Walsh Cherer Ltd 2 nd Floor, Quality House, 6-9 Quality Court, Chancery Lane, London WC2A 1HP Telephone No: 020 7067 2900 DX: 410 LDE Email: [email protected] Web: www.martenwalshcherer.com