Dear
Colleagues,
Apologies
for posting this to both the RDG and ODG at once, but I think that the case
below will be of interest of members to both.
Treacy
J has today given judgment in AT & Ors v Dulghieru & Anor [2009]
EWHC 225 (QB) (19 February 2009) http://www.bailii.org/ew/cases/EWHC/QB/2009/225.html,
a case where the claimants alleged an unlawful conspiracy to traffic them into
the UK from Moldova and to enslave them sexually. The defendants had been
convicted of offences arising out of the horrific facts. They claimed damages
for pain, suffering and loss of amenity in respect of post traumatic stress
disorder, coerced sexual activity and false imprisonment. They also claimed
special damages but these were not substantiated and so not awarded. There was
also an award of aggravated damages, as the judge considered “that the Defendants' conduct was so appalling, so malevolent, and
so utterly contemptuous of the Claimant's rights as to amount to exceptional
conduct warranting an award of aggravated damages. Moreover I consider that the
injury to the individual Claimants' feelings of human pride and dignity, taken
together with the humiliation, distress, degradation and insult inflicted upon
them by the Defendants' actions is such that they would not be adequately
compensated for these injuries to their feelings if the award were restricted
to that which I have already awarded by way of general damages.”
Of
especial interest, aside from the fact of bringing of a tort claim for unlawful
conspiracy in this context, is the judge’s award of exemplary damages. The
judge regards such damages in this case as being “primarily one of
preventing unjust enrichment”, although it is not clear whether it is
used in this case in a technical or loose sense, given the process of
assessment of the eventual sum. The relevant paragraphs are [67]-[76]:
Exemplary
Damages
- The pre-conditions for such an award are
to be found in Rookes v Barnard [1964] AC 1129. At pages
1226-7 Lord Devlin sets out his second category in relation to which such
damages may be awarded, namely in circumstances where a Defendant with a
cynical disregard for a Claimant's rights, has calculated that money to be
made out of his wrongdoing will probably exceed the damages at risk.
- I must bear in mind, as Lord Devlin did
at page 1230 of Rookes v Barnard, that where the tortious
activity is also criminal, it is undesirable that an aggrieved party
should be given an option to inflict for his own benefit punishment by a
method which denies to the offender the protection of criminal law.
However, the criminal proceedings in this country did not result in any
order of compensation to these Claimants. Moreover, the Defendants'
exposure under this head can be appropriately limited by bearing in mind
the rationale for the second category of exemplary damages as identified
by Sedley LJ at paragraph 26 of Borders (UK) Limited and Others v
Commissioner of Police of the Metropolis [2005] EWCA Civ 197. The rationale
behind the second category is not the punishment of the Defendant, but the
prevention of his unjust enrichment.
- I accept the submission that where the
word "calculated" was used by Lord Devlin, this was not intended
to require some precise mathematical process or detailed reasoning. What
is necessary is that the Defendants deliberately acted in a way regardless
of the Claimants' rights, with a view to making profit for themselves in
circumstances which were likely to produce profits for them beyond
anything that could subsequently be recovered from them by way of any
legal process. The evidence here convinces me that these Defendants acted
in such a way. Their activities, along with their associates, were carried
out in such a way as to generate huge benefits for themselves, as
exemplified by confiscation orders made in the criminal proceedings,
totalling approximately £786,000.00.
- The victims of their conduct (and it is
plain that there was a significant number of other young women in a
similar plight) were told that they had to work off so called debts of
£20,000.00 as the price of their being brought to this country. They were
quoted rents for the accommodation in which they were being kept against
their will of £300.00 a day, and they were required to indulge in
commercial sexual encounters with large numbers of men per day, entirely
without regard for their wishes, comfort or physical wellbeing. I am sure
that these Claimants had no idea of the level of monies being generated
for the benefit of these Defendants and their associates. I am satisfied
that the Defendants felt confident that by reason of their use of coercion
and threats, that they would never face any financial reckoning at the
hands of these Claimants.
- Since the rationale behind an award of
exemplary damages is primarily one of preventing unjust enrichment, I need
to consider whether the making of the confiscation orders in the criminal
proceedings would in any way preclude an award of exemplary damages. For
the reasons analysed in the Borders (UK) case, I do not
think it would. Moreover, as already observed, the outcome of the criminal
trial resulted in no compensatory award to these Claimants. In addition,
although very large confiscation orders were made in the result, the First
Defendant was found to have nothing to pay in terms of realisable assets,
and the Second Defendant was ordered to pay £4,000.00 only as representing
her realisable assets.
- The profits made by these Defendants at
the expense of these Claimants far exceed those sums. In those
circumstances I am confident that the Defendants will not be mulcted in
the same sum twice. As to the level of quantum, there are no strict rules
for the assessment of an award. I have considered Lord Woolf's
observations in Thompson, at page 157c where he envisages a
bracket of between £5,000.00 and £50,000.00, the latter representing an
absolute maximum in cases involving assault, false imprisonment and
malicious prosecution by the police. I remind myself of the judgment of
Lord Devlin in Rookes v Barnard, at page 1228, where he
stated that in a case where exemplary damages are appropriate, a jury
should be directed that if, but only if, the sum which they have in mind
to award as compensation is inadequate to punish the Defendant for his
outrageous conduct, then it can award some larger sum.
- I do not consider that the sums so far
awarded to the Claimants suffice to show these Defendants that their
misdeeds do not pay, nor do they mark the court's disapproval of their
outrageous conduct.
- I note the evidence which demonstrates
to me that these young women had to charge up to £50.00 for a fifteen
minute sexual encounter. I note the estimates of individuals that they
were generating between £500.00 and £1,000.00 per day by their activities,
dependent on which brothel they were taken to. These daily figures
represent amounts generated per individual. None of them saw any of the
money they had generated. I use these figures, together with the other evidence
about a daily rental of £300.00 and the bond of £20,000.00 per victim, in
order to assist me in gaining a feel for an appropriate level of exemplary
damages.
- Having regard to Riches v News
Group Newspapers Limited [1986] QB 256, I consider that the correct
approach is to fix an overall sum and then divide it equally between the
Claimants. I think it is appropriate to do that in this case since they
have all been subjected to the same type of unconscionable behaviour by
these Defendants. They have not invited me to differentiate between them.
Looking at the matter overall, and taking account of the compensatory
awards, by way of basic damages and aggravated damages, I conclude that a
further sum of £60,000.00 should be awarded by way of exemplary damages.
That sum will be divided equally between the four complainants so that the
figure of £15,000.00 is to be added to each of the sums awarded to them by
way of basic and aggravated compensatory damages.
- It follows that the total amount awarded
to these Claimants against these Defendants, who are liable jointly and
severally are, in the case of AT £175,000.00, NT £162,000.00, in the case
of ML £132,000.00 and in the case of AK £142,000.00.
Best
wishes,
James
--
James
Lee
Lecturer
Director
of the LLB Programme
Birmingham
Law School
University
of Birmingham
Edgbaston
Birmingham
B15 2TT, United Kingdom
Tel: +44 (0)121
414 3629
E-mail: j.s.f.lee@bham.ac.uk