Decision

Decision on Hermitage Capital Partners PLC

Published 6 July 2021

Decision under the Companies Act 2006

In the matter of application No. 3311

By Hermitage Capital Management Limited

For a change of company name of registration No. 12634656

Decision on Costs

Background

1. This is a decision on costs against which there is, under section 74 of the Companies Act 2006 (“the Act”), no right of appeal. As a consequence, I have, where I consider it appropriate, reproduced below verbatim certain parts of the pleadings and submissions filed.

2. Company 12634656 (“the primary respondent”) was incorporated on 30 May 2020 with the name Hermitage Capital Partners PLC. On 23 October 2020, Hermitage Capital Management Limited (“the applicant”), made an application to this Tribunal under section 69 of the Companies Act 2006 (“the Act”) for a change of name of this company.

3. In its application, the applicant states that it has goodwill/reputation in the names “Hermitage”, “Hermitage Capital Management”, “Hermitage Capital” and “Hermitage Fund” and that this goodwill/reputation is in relation to:

“Finance, in particular the field of investments and asset management, specifically the operation and management of hedge funds.”

4. The applicant asks the Tribunal to order the primary respondent to change its name to:

“one that is not the same as, or confusingly similar to [the names shown above] and not to now, or in the future, cause or permit any steps to be taken calculated to result in another company being registered with a name similar [to those shown above].”

5. Having indicated that on 2 September 2020, it warned the company that if it did not change its name it would start legal proceedings against it, the applicant further states:

We would stress that we have made a number of efforts to contact the respondent. Correspondence has been sent to the respondent’s registered address via recorded delivery and normal post, as well as by email. We have received no response.

6. A copy of this application was sent to the primary respondent’s registered office i.e. 6 Hardy Passage, London, N22 5NZ (“Hardy Passage”) on 23 November 2020, in accordance with rule 3(2) of the Company Names Adjudicator Rules 2008 and a period expiring on 23 December 2020 was allowed for a defence to be filed. The copy of the application was sent by the Royal Mail’s “Signed For” service and also by standard mail. On the same date, the Tribunal wrote to William Joseph Lyster and John Michael Lyster to inform them that the applicant had requested that they be joined to the proceedings.

7. As the Tribunal received no comments or objections, in an official letter dated 9 March 2021, both were joined to the proceedings as co-respondents and made jointly and severally liable with the primary respondent for costs. On the same date, the parties were advised that as no defence had been received to the application, the adjudicator may treat the application as not being opposed and may make an order under section 73(1) of the Act. The parties were granted a period of 14 days to request a hearing in relation to these matters.

8. On 15 March 2021, the Tribunal received an email from “Jody Lyster”. It transpired that this is a reference to Mr William Joseph Lyster. The email explained that having spoken to various Tribunal Casework Examiners (“CWE”) on 12 and 15 March 2021:

I am contacting you to confirm I have received your letter dated 9th March 2021…

I am happy to change the name of said entity. This is a very disturbing letter to receive in the midst of this pandemic when we have more pressing financial concerns. I feel this strong arm tactic and general intimidatory approach is both unjust and completely unwarranted.

Sequence of events and notifications

I have been informed…that a warning letter dated the 2nd Sep 2020 from [the applicant] was directed to the company. Secondly, a letter was sent [by the Tribunal] dated the 23rd November 2020. I was not aware of either of the above…I will liaise with Co house and delete the name “HERMITAGE” from the company name. Please confirm this is agreeable and the matter will then be closed. Proposed new name: “London City Capital Partners PLC.”

WJ Lyster
6 Hardy Passage
Wood Green
London
N22 5NZ.

9. In an email dated 24 March 2021, Mr Jody Lyster advised the Tribunal that the company’s name had been changed to London City Capital Partners Plc with effect from 21 March 2021. I note that that email contains a reference to: “Hermitage Property Group, 150 Warwick Road, Kensington, London, W14 8PS.” On 1 April 2021, the Tribunal received a further email from Jody Lyster, the operative part of which reads:

I also wish to reaffirm my statements below that I had not received communications notifying me of an issue. I am incensed that I may now be subject to costs regarding a company that I formally incorporated with Co House on the 20th May 2020. I sincerely hope this will be the end of the matter…

10. In an official letter dated 19 May 2021, the Tribunal wrote to the parties. It stated:

The name of company no 12634656 has changed to one that does not appear to be an offending name, namely: London City Capital Partners PLC.

The case has been reviewed by the Adjudicator and it is his preliminary view that £800.00 is to be awarded to the applicant, given that notice was given to the primary respondent prior to action at the tribunal and that it appears that the primary respondent’s failure to respond was because it didn’t call for the official letters of 23 November 2020. I enclose copies of the returned letters of 23 November 2020 marked as ‘not called for’ by the Royal Mail for your attention.

11. Attached to that official letter were copies of the official letters of 23 November 2020 sent to the primary respondent and co-respondents by “Signed For” post, all of which were returned to the Tribunal on 21 December 2020. These letters were accompanied by photocopies of the front of the envelopes upon which there appeared a Royal Mail sticker (hand dated “16/12”) which indicates that the letters were “Not called for”.

12. The parties were allowed 14 days to challenge that preliminary view by filing a Form CNA4 (and fee) to request a hearing and, on 24 May 2021, the primary respondent requested a hearing. I note that Form contains a reference to Hardy Passage. In an email accompanying the Form CNA4, Mr Jody Lyster stated:

I restate my position…I had not received the letters of the 23rd November 2020. I also reaffirm the second point in line with Gov guidelines and COVID precautions during the pandemic I would not have been in a position to circulate freely through the community and “call in on the Royal Mail”. Finally, 2020 was a very tough year and as set out below on becoming aware of the matter I liaised with your office and resolved the matter without delay.

Representation at the hearing

13. A hearing to consider the matter took place before me, by telephone, on 15 June 2021. At the hearing, the primary respondent was represented by Mr Jody Lyster and the applicant by Ms Becky Knott of Barker Brettell (“BB”), the applicant’s professional representatives in these proceedings. As required, Ms Knott filed a skeleton argument in advance of the hearing, which, at the hearing, Mr Lyster confirmed he had received.

Hearing discussion

14. As both parties were present at the hearing and as the applicant provided a skeleton argument in advance of the hearing, it is not necessary for me to record the competing submissions here in great detail. At the hearing, Mr Lyster felt very strongly that because the primary respondent took immediate steps to change the company name as soon as it became aware that an application to the Tribunal had been filed (i.e. when it received the official letter of 9 March 2021), that ought to be the end of the matter.

15. At the hearing, I asked Mr Lyster if he could explain why the applicant’s pre-action letters of 2 September 2020 and the official letters of 23 November 2020 were returned to those who sent them marked “Not at address” and “Not called for” respectively. In this regard, he explained that the primary respondent’s and co-respondent’s registered addresses at Companies House i.e. Hardy Passage, is a service address.

16. At the hearing, Mr Lyster specifically confirmed that Hardy Passage did not provide a mail scanning/forwarding service. He went on to explain that he was out of the country from late November 2020 to January 2021 and added that given the advice provided by the relevant authorities to those in London during the various stages of the covid lockdowns, to use the words contained in his email of 24 May 2021, he would not have been in a position to “circulate freely through the community”. He did, however, fairly accept that when lockdown restrictions permitted, mail sent to Hardy Passage was obtained by the primary respondent.

17. Although Ms Knott’s submissions were much the same as those contained in her skeleton argument, in response to a comment from Mr Lyster at the hearing, she explained that having failed to locate an email address for the primary respondent at the time the pre-action letters were sent, the applicant also sent an email to an alternative address it felt was related to the primary respondent i.e.

info@hermitagerealestate.co.uk.

18. Further investigations including on LinkedIn (which was specifically mentioned by Mr Lyster at the hearing) were, she explained, inconclusive, although this may, she speculated, be because searches were conducted for Mr Lyster’s full name as opposed to the name he appears to go by and which is used in his email address i.e. jody@hermitagepropertygroup.com.

Decision

19. Section 74 of the Act reads:

Appeal from adjudicator’s decision

(1) An appeal lies to the court from any decision of a company names adjudicator to uphold or dismiss an application under section 69.

(2) Notice of appeal against a decision upholding an application must be given before the date specified in the adjudicator’s order by which the respondent company’s name is to be changed.

(3) If notice of appeal is given against a decision upholding an application, the effect of the adjudicator’s order is suspended.

(4) If on appeal the court-

(a) affirms the decision of the adjudicator to uphold the application, or

(b) reverses the decision of the adjudicator to dismiss the application,

the court may (as the case may require) specify the date by which the adjudicator’s order is to be complied with, remit the matter to the adjudicator or make any order or determination that the adjudicator might have made.

(5) If the court determines a new name for the company it must give notice of the determination-

(a) to the parties to the appeal, and

(b) to the registrar.”

20. Rule 11 of the Company Names Adjudicator Rules 2008 (“the rules”) states:

The adjudicator may, at any stage in any proceedings before him under the Act, award to any party by order such costs (in Scotland, expenses) as he considers reasonable, and direct how and by what parties they are to be paid.

21. The relevant parts of the Tribunal’s Practice Direction read as follows:

“9. Voluntary change of name

9.1 New name does not appear to adjudicator to be an offending name

9.2 Name changed after CNA1 served

9.2.1 The adjudicator will be minded to decide that the application is without object and the application will be closed.

9.2.2 If any of the parties object to the closing of the proceedings the adjudicator will consider the merits of the objection(s) and decide on the course of action to be followed.

9.2.3 If the company has voluntarily changed its name after the application has been filed and it had notice that an application would be made, an award of costs could still be made against the newly named company as it remains the same legal entity as the originally named company. Any award of costs would be dependent upon the applicant seeking an award of costs and satisfying the tribunal that the respondent had received sufficient notice that the application would be made (see 10.4). Requests for costs in such cases will be considered on the facts of the individual case.”

And:

“10. Costs

10.1 Scale of costs

10.1.1 Under rule 11, the adjudicator may award costs (in Scotland, expenses) to any party in the proceedings. The adjudicator will not normally award the actual costs incurred but will follow a scale of costs. The scale of costs will give an indication to the parties at the outset as to what they are likely to have to pay if they lose.”

For those with legal representation the scale of costs will be as follows:

Procedure Costs

Preparing a statement and considering the other side’s statement. From £300 to £500 depending on the nature of the statements.

Preparing evidence and considering and commenting on the other side’s evidence. From £500, if the evidence is light, to £2,500 if the evidence is substantial. The award can go above this range in cases involving an exceptional amount of relevant evidence but may be cut down if the successful party had filed a significant amount of unnecessary evidence.

Preparing for and attending a hearing. Up to £1,500 per day of hearing, capped at £3,000 for the full hearing unless one side has behaved unreasonably. From £100 to £500 for preparation of submissions, depending on their substance, if there is no hearing. Expenses.

(a) Official fees arising from the action that have been paid by the successful party (other than fees for extensions of time.)

(b) The reasonable travel and accommodation expenses for any witnesses of the successful party required to attend a hearing for cross examination.

Those without representation will normally receive 50% of the above but will receive the full expenses.”

Chronology of events

22. For the sake of convenience, this appears to be as follows:

30 May 2020 – the primary respondent is incorporated as Hermitage Capital Partners PLC;

2 September 2020 – the applicant writes to the primary respondent by recorded delivery, ordinary post and email allowing until 30 September 2020 for a response;

18 September 2020 – BB are notified that the applicant’s letters sent to the primary respondent are returned annotated “Not at address”. No “bounce-back” was received from the email address used;

23 October 2020 - application filed with the Tribunal;

23 November 2020 - the Tribunal serves the application upon the primary respondent and co-respondents at Hardy Passage;

21 December 2020 - the official letters sent by “Signed For” post to the primary and co-respondents are returned to the Tribunal by the Royal Mail marked “not called for”;

23 December 2020 - deadline to file a defence and comment on the joining issue;

9 March 2021 - the Tribunal notes the application has not been defended, joins the named individuals as co-respondents and allows until 23 March 2021 for a hearing to be requested;

15 March 2021 - email from Jody Lyster indicating that the applicant’s letter of 2 September 2020 was not received nor were any of the copies of the official letters of 23 November 2020 which were sent by both “Signed For” and ordinary post; 21 March 2021 - the primary respondent’s company’s name is changed to London City Capital Partners PLC;

19 May 2021 - preliminary view issued by the Tribunal indicating that the new name is non-offending and that an order of costs to the applicant in the amount of £800 is appropriate. A period expiring on 2 June 2021 is allowed for a hearing to be requested.

24 May 2021 – the primary respondent requests a hearing to challenge the preliminary view on costs.

23. In its skeleton argument, the applicant states:

“16. As a matter of course, the Applicant’s representatives would always try to engage in pre-action correspondence before filing an action as serious as a Company Name Complaint with the Tribunal. This case is no exception and the Applicant made every effort to contact the Respondent before filing the application.

17. The Applicant’s application could have been avoided had the Respondent engaged with the pre-action correspondence from the Applicant and changed its name at an earlier date. The Applicant gave the Respondent sufficient notice that the application would be made (over six weeks) and confirmed in box 6 of Form CNA1 that it contacted the company prior to making the application.

18. Consequently, it would be inequitable for the Applicant to be forced to bear the full costs of making its application. In the circumstances, the application to the Tribunal was both reasonable and proportionate and, as a result, the Applicant is entitled to a contribution towards the costs it incurred in making its application. This is on all fours with Case O-156-14, Blue Sky Law Limited vs Blue Sky Legal Services Limited.

19. To conclude, the Applicant asks that the Tribunal’s preliminary view of 19th May 2021 be upheld and that the award of costs of £800 be made in favour of it…”

Considerations

24. I fully accept Mr Lyster’s submissions to the effect that the covid pandemic has had a significant impact in this country including, from time to time, on the freedom of movement. However, it is equally clear to me in my role both as a Company Names Adjudicator and a member of the general public, that since the start of the pandemic in March 2020, many businesses, large and small and the public at large have found ways to adapt to these unusual circumstances.

25. Although the applicant has not provided copies of its pre-action letter of 2 September 2020 or evidence of the response it states it received in reply, I see absolutely no reason to doubt such a letter was sent or that it received the reply it said it did. Consequently, when one reviews the chronology mentioned above, it is clear that on 2 September 2020, the applicant wrote to the primary respondent (by both recorded delivery and ordinary post) to the address held for it on the Companies House database (i.e. Hardy Passage), allowing it until 30 September 2020 to change its name. It also wrote to what it considered to be a related email address. On 18 September 2020, the applicant’s representative states that it was notified that these letters were returned marked “Not at address”. The Tribunal’s letters sent by “Signed For” post were also returned, although this time they were marked “Not called for”. That suggests that insofar as the latter is concerned, the Royal Mail attempted to deliver the letters to the primary respondent’s registered address, but as it appears no one was available to sign for them, it is likely, given the Royal Mail’s usual practice, that a card was left indicating they may be collected. There is, however, nothing to suggest that the letters sent by ordinary post (which did not require a signature) were not successfully delivered.

26. As the primary respondent’s registered address has not changed since its incorporation in May 2020, exactly why the applicant’s letters of 2 September 2020 were returned to it marked “Not at address” is unknown. Any speculation on my part in this regard would be fruitless. Regardless, in my view, the applicant took all reasonable steps to make the primary respondent aware of its concerns and in so doing allowed it a reasonable amount of time to consider the matter and, if it considered it appropriate, to change its name. In addition, following the expiry of the period allowed by the applicant for the primary respondent to take action (i.e. 30 September 2020), the applicant did not make an application to this Tribunal until 23 October 2020.

27. While I understand Mr Lyster’s submission to the effect that the primary respondent’s registered address did not provide any type of mail forwarding service, when one elects to use an address over which, it appears, the primary respondent had no control, one has to take responsibility for any failures resulting from that decision. Had the primary respondent chosen a registered address over which it had control, it is likely that the applicant’s pre-action letters would have been received and acted upon in a timely manner by the primary respondent and the matter would not have come before the Tribunal. However, that is not the case. Given Mr Lyster’s submissions at the hearing on the effect of the pandemic and the severe restrictions it placed on the freedom of movement in London, it appears that even if the applicant’s pre-action letters has been safely delivered to the registered address, as no alternative arrangements had been put in place by the primary respondent to ensure that it received such mail, it appears unlikely that the primary respondent would have become aware of the letters in any case.

28. In reaching a conclusion, I remind myself that the primary respondent took action to change its name to a non-offending name as soon as it became aware that an application had been filed. However, the applicant warned the primary respondent of its concerns prior to the filing of the application and allowed it an opportunity to take action. Having had those letters returned marked “Not at address”, there is nothing to suggest that reissuing the letters on the same basis would have resulted in a different outcome. What is absolutely clear is that the primary respondent’s failure to receive those letters was not a fault of the applicant. Having failed to react to those letters, the filing of the application was entirely reasonable and proportionate.

29. While I also note that the primary respondent failed to respond to the Tribunal’s letters of 23 November 2020, as I mentioned above, in my view, that is because of a failure on its part to put systems in place to ensure that it received mail in a timely manner. However, even if the official letters had been received by the primary respondent and the name changed in the period allowed for the primary respondent to file a defence, given the factual matrix described, the fact remains that having failed to respond to the applicant’s pre-action letter of 2 September 2020, in order for the applicant to have the name changed, an application to this Tribunal would still have been required.

Outcome

30. Weighing up all of the above factors, I have concluded that the primary respondent’s failure to receive and act upon the applicant’s pre-action letters and those of the Tribunal are entirely of its own making. In those circumstances, I am satisfied that the applicant’s decision to make an application to the Tribunal was reasonable and proportionate and that the preliminary view expressed in the official letter of 19 May 2021 to award the applicant £800 as a contribution towards the costs it incurred in preparing and filing the application was appropriate. For the avoidance of doubt, at the hearing Ms Knott made no request for an award of costs in relation to the hearing itself.

31. I therefore order London City Capital Partners PLC (being the same legal entity as Hermitage Capital Partners PLC), William Joseph Lyster and John Michael Lyster being jointly and severally liable, to pay to Hermitage Capital Management Limited costs on the following basis:

Preparing a statement: £400
Costs (official fee): £400

Total: £800

32. As indicated above, there is no right of appeal against this decision.

Dated this 28 June 2021

Christopher Bowen
Company Names Adjudicator