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The High Court (Mr. Justice Jay) has made an order that a defendant be committed to prison for 18 months for contempt of court, finding him responsible for multiple breaches of a freezing order and a search order. Companies in the Hewlett Packard Group (“HP”) obtained the freezing and search orders in December 2015. The orders were made in aid of their fraud claim against Peter Sage, an entrepreneur and motivational speaker (as well as against a co-defendant). The claim was for damages of approximately US$17.5 million.

HP contended that, in breach of the freezing order, Mr. Sage had dissipated aggregate sums of £50,000 and US$75,000 from a bank account and a PayPal account on the day that the orders were served. HP also claimed that, in breach of the search order, Mr. Sage had failed to deliver up an engagement ring on the premises, valued at £55,000. In addition, HP contended that he had committed various other contempts, including failing to disclose bank accounts and email addresses and changing the password to a Dropbox account.

Mr Sage contended inter alia that (i) he gave no instructions to transfer money from the PayPal account or the bank account; (ii) the money paid out belonged not to him, but to Sage International FZE (a company that ran his motivational seminars); (iii) he did not control the company and his fiancée was actually its beneficial owner; (iv) the money was, in any event, paid out in satisfaction of its legitimate debts in the ordinary course of business; and (v) the engagement ring was not on the premises during the search, but rather had previously been pledged to an associate as security for a £7,000 debt. 

Following a three-day hearing in January 2017, Mr. Justice Jay rejected each account. The Judge held inter alia that Sage International FZE was Mr. Sage’s alter ego; that the ring was on the premises and his fiancée had hidden it during the morning of the search; that he had got a message out to his de facto step-mother to make the payments on the day of the search; and that he, his fiancée and his de facto step-mother gave false evidence. Mr. Sage was held to be in deliberate, extensive and flagrant breach of the orders and to have shown no remorse or contrition. Mr. Sage was committed to prison for 18 months.

Anthony Peto QC and Robert Weekes acted for the applicants, HP.

The full judgment can be read here.

Note:  On 14th July 2017 on appeal, the Court of Appeal affirmed the findings of contempt, except that the Court allowed the appeal in relation to one contempt, namely the alleged hiding off the engagement ring.  The Court accordingly reduced the sentence to one of 12 months’ imprisonment.  A copy of that judgment can be read here.

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