Eckman -v- Sidem

On 4 th November, 2009, the Court allowed the plaintiff's appeal and reversed the decision of the Master taken on 2 nd June, 2009, by which he struck out the plaintiff's claim on the basis of a failure to issue a summons pursuant to Royal Court Rule 6/26 and on the ground that there had been inordinate and inexcusable delay in the prosecution of the action. We now give our reasons.

In or around 1992 the plaintiff entered into a contract with two companies, Sidem International Limited (the first defendant in these proceedings - "Sidem") and Saco Defence Limited ("Saco"). Sidem and Saco (as to 80%) were owned ultimately by Michault Family Trusts of which Pinnacle Trustees Limited ("Pinnacle") in Jersey was the trustee. Pinnacle administered those companies.

Sidem and Saco were involved in the business of the acquisition and sale of armaments. The second defendant, Patrick Michault, has been described by the plaintiff as the shadow director of Sidem. Iain Alexander Grant Moodie ("Mr Moodie") was the managing director of Pinnacle at the material time and has deposed that it was through these companies that the second defendant managed and controlled his and his family's interests in the acquisition and selling of armaments (paragraph 10 of his affidavit of 15 th October, 2009).

The second defendant denies that he was Sidem's shadow director but Miss Robinson accepted during the hearing that he had, through the Michault Family Trusts, an ultimate beneficial interest in Sidem.

On 10 th May, 1999, the plaintiff commenced proceedings against Sidem and Saco for breach of contract ("the first action"). The plaintiff obtained judgment in the Royal Court in relation to the first action on 17 th October, 2001. However, that judgment was appealed by Sidem and Saco, which appeal was dismissed on 18 th July, 2002.