Wilmington Trust SP Services (Dublin) Ltd & Ors v State Aviation Company Ltd & Anor

1. THE DEPUTY JUDGE: On Monday 15 December I heard four applications in this matter. Due to the time taken for submissions, there was insufficient time to give judgment. The time estimate of one day, which was meant to include half a day for pre-reading and time for judgment, was inadequate. I am therefore delivering this judgment on Friday, 19 December.

2. The four applications which fall to be determined are, firstly, the application of the second defendant (“ PEY ”) for an extension of time for disclosure, dated 13 June 2025; secondly, the Claimants’ application, dated 1 July 2025, (a) to strike out what are said to be non-consequential amendments to PEY’s purported amended defence on the basis they have been made without permission, required the withdrawal of admissions and have no realistic prospect of success, and (b) for an unless order in relation to the first defendant, (“ State Aviation ”) (who has ceased all communications and appears no longer to be playing any part in these proceedings) in respect of its continuing failure to give disclosure; thirdly, PEY’s application, dated 17 July 2025, for permission to allow the non-consequential amendments in the amended defence and for permission to withdraw admissions if required (this is essentially responsive to the Claimants’ application to strike out the alleged non-consequential amendments and therefore covers the same ground); fourthly, the Claimants’ application for an unless order against PEY, dated 2 December 2025, in respect of its unreasonable refusal to give disclosure and the risk the proceedings are derailed further.

3. The first of these four applications was for an extension until 22 August 2025. That date has passed and no disclosure has been provided by PEY. That essentially has been overtaken by the subsequent applications, which I will focus on first. I note this case is listed for a five-day trial starting on 14 July 2026.

4. The last of the four applications, namely the application for an unless order against PEY, is not pursued by the Claimants given the recent instruction by PEY of new solicitors, Mishcon de Reya, and the confirmation on behalf of PEY that they can meet the proposed new deadline for disclosure on 31 January 2026. Additionally, on 12 December the Claimants issued a further application, namely for alternative service of documents on State Aviation. They have asked me to address this on paper.

5. It is agreed that the issues for determination by me are as follows: firstly, whether PEY is permitted to advance its new defence. That turns on (a) the correct interpretation of the order of HHJ Pelling KC made on 8 April 2025 (“ the April Order ”), (b) whether admissions have been made and if so, whether permission should be given to withdraw those admissions, and (c) whether the amendments have any realistic prospects of success. The outcome of these issues will have a knock-on effect on disclosure. Secondly, whether the court should make an unless order in relation to disclosure. The court is invited to make an unless order against State Aviation so their respective defences should be struck out if they fail to give disclosure by 31 January 2026. In the course of oral submissions, the Claimants confirmed that given the proceedings will continue against PEY and therefore the case will have to be proved against State Aviation before PEY could be liable, the proportionate sanction which should be imposed under any unless order is to debar State Aviation from defending as opposed to striking out its defence. Thirdly, I am going to have to deal with directions to trial, but given the times in the directions order have long since passed, it will be necessary for a new timetable to be set out.

6. As to the first of these issues, Mr Langley on behalf of the Claimants says this breaks down into five points: (1) is permission needed for the amendments in PEY’s amended defence, or has it already been given under the April Order? (2) have admissions been made in the original defence?

7. (3) if so, is permission required to withdraw the admissions? (4) if so, should permission be given? (5) should permission be refused on the grounds that the objected-to parts of the amended defence have no realistic prospects for success?

8. I turn to the factual background. The claim is a relatively straightforward claim for sums due under a helicopter lease agreement entered into between the first Claimant and State Aviation, performance of which was guaranteed by PEY. There is a case memorandum prepared before the amendment to the claim to add the second and third Claimants, which I shall revert to shortly. The dispute is summarised in the following terms. The first Claimant was until June 2024 the legal owner of one Leonardo AW119KX helicopter. The helicopter is held on trust for the beneficial owner, Thora Ireland Leasing II Limited. The first defendant, State Aviation, is a Tanzanian company, which provides helicopter services in mainland Tanzania and Zanzibar. The second defendant, PEY, is a private investment company incorporated under the laws of Singapore. The first Claimant, as lessor, leased the helicopter to State Aviation as lessee pursuant to a helicopter operating lease agreement dated 21 September 2023. State Aviation’s obligations under the lease agreement were guaranteed by PEY under a deed of guarantee and indemnity dated 31 October 2023 between PEY and the first Claimant. The express terms of the lease agreement provided for the payment of deposits defined as US$92,000 and rent monthly in advance defined as US$46,000 per month.

9. On 10 November PEY as guarantor made a deposit payment of US$46,000. No other payments have been made. On 29 January 2024 the first Claimant issued a notice of event of default to the defendant in respect of what the first Claimant claims to be outstanding sums due under the lease agreement. Having received no payment, the first Claimant terminated the lease agreement on 1 February 2024, and by this claim, the first Claimant claims the outstanding sums in debt and damages for the losses suffered by reason of the termination of the lease agreement. The Defendants deny liability on the basis of an alleged oral variation of the lease agreement; alternatively, by way of alleged estoppel. In particular, they allege that the parties agreed a “rent holiday” during a telephone conversation on or about 9 November 2023 under which future payments due to the first Claimant under the lease agreement would be suspended until certain trigger conditions were met. The Defendants contend the relevant trigger conditions were not met and therefore they did not have any obligations to pay the deposit or rent under the lease agreement. The first Claimant denies the lease agreement was varied as alleged and, further, denies it would otherwise be estopped from claiming the sums payable under the lease agreement. According to the only substantive defence originally put forward by the Defendants, who were at that stage jointly represented by the same solicitors and counsel, was based on an allegation that the first Claimant and State Aviation had agreed this rent holiday, such that no sums would be due under the lease. PEY did not advance any separate defence as guarantor. Its defence was simply that it was not liable if State Aviation was not liable. It is submitted by the Claimants that PEY admitted that it guaranteed State Aviation’s obligations without any qualification.

10. In addition to the case memorandum, the parties agreed a list of common ground and issues. This is stated, as is normal, to be without prejudice to the parties’ pleaded cases. This is not generally understood to mean that the list of common ground and issues is something which is contrary to the parties’ pleaded cases, merely that it is a short form which will not encapsulate every point taken in the parties’ pleaded position. In the list of common ground at paragraph 14, it is expressly set out as common ground that “PEY’s liability under the guarantee is co-extensive with that of State Aviation. Accordingly, if State Aviation is liable to the Claimant, PEY is also liable to the Claimant to the same extent”.

11. The procedural history up to 31 January is set out in the case memorandum. The key dates are as follows. On 23 April 2024 the claim form was issued. On 26 April 2024 it was served. On 17 June 2024 Particulars of Claim were filed and served. On 5 August 2024, following extensions which had been agreed, the Defendants filed and served their Defence. On 18 July Foxton J indicated the court was minded to transfer the claim to the London Circuit Commercial Court, and that has subsequently happened. On 23 August 2024 the Claimant filed and served its reply, and on 31 January 2025 there was a case management conference. It is to be noted the Defence as served in August 2024 was endorsed with a statement of truth signed by Mr Moshe Schlisser on behalf of PEY.

12. In advance of the hearing on 31 January 2025, the Claimant had indicated it wished to amend its case as to the loss suffered. Mr Sean O’Sullivan KC, sitting as a deputy High Court judge, gave the following agreed directions, which are the most relevant ones to the issues before me: (1) The parties shall comply with the Practice Direction 57 AD. (2) The disclosure review document was approved in the form annexed to the order and extended disclosure was ordered. (3) The list of issues for disclosure and models of extended disclosure could be revised and/or supplemented by agreement. (4) By 4.00 pm on 30 May 2025 each party shall exchange by way of service (i) a disclosure certificate substantially in the form set out in appendix 4 to PD 57AD and (ii) an extended disclosure list of documents upon which it relies. (6) signed statements of witnesses and facts and hearsay notices when required shall be exchanged not later than 4.00 pm on 19 of September 2025. Under the heading “Particularisation: the Claimants’ case on loss”, it was provided at paragraph (9) that by 4.00 pm on 14 March 2025 the Claimants shall serve on the defendants any proposed amendments and/or further particularisations of claim for loss, which will be subject to CPR 17.1(2). The defendants shall confirm whether or not they consent to the proposed amendments and/or further particularisation of the Claimants’ claim for loss by no later than 28 March 2025. (10) Following service of proposed amendments and/or further particularisation of its claim for loss by the Claimants pursuant to paragraph (9) above, either party shall have liberty to apply for permission to rely on expert evidence on matters of loss and quantum. Paragraph (13) set down the trial and then paragraph (20) the costs management order in this case and approved the parties’ costs budgets as agreed by the parties.

13. Pursuant to that order, the Claimants served a proposed amended claim form and amended Particulars of Claim in which it joined the second Claimant and third Claimant, as they were said to be the ones who had suffered the loss and the loss was more fully quantified. No significant amendments were made to the liability parts of the statement of case, as opposed to the quantum aspects.

14. The Defendants did not object to the amendments, although because two parties had been added as Claimants, the court’s permission was also needed. This culminated in the April Order. This is not on its face expressed to be a consent order, but I am told the parties had agreed its terms. The order was made by HHJ Pelling KC. It recites that upon reading the amended Claim Form and the amended Particulars of Claim, and upon the second and third Claimants having consented in writing to being added to the proceedings, it was ordered firstly that they be added as the second and third Claimants, and in paragraph (3), permission is given to serve the amended Particulars of Claim and amended claim form upon the defendants. It then provided “(4) The defendants shall have 14 days from service of amended Particulars of Claim in which to file and serve an amended defence. (5) The Claimant shall be responsible for the costs of and arising from the amendments to the claim form and the Particulars of Claim”. This wording does not expressly say that the amended defence was to be limited to amendments consequential on the amendments to the Particulars of Claim.

15. Collyer Bristow came on the record for PEY on 22 April 2025. This was apparently as a result of some conflict between State Aviation and PEY, although no details have been provided of what the conflict was. There followed three orders extending the deadline for the amended defence, each using the same form of wording. Reed Smith, who had been the solicitors for State Aviation, were permitted to come off the record by order of HHJ Pelling KC on 23 May 2025. No other solicitors have come on the record, nor has State Aviation taken any further steps in this litigation since that time. HHJ Pelling KC made provision for service of that order on State Aviation. State Aviation has not provided an address for service, as it is required to under the CPR, on it ceasing to have representation. There has been no order made yet for alternative service on State Aviation in favour of the Claimants, and as I have said, a separate application was issued shortly before the hearing before me.

16. On 31 May 2025 PEY served its amended Defence, to which I shall return. This was endorsed with a statement of truth signed by Mr Schlisser. On 4 June 2025 HHJ Pelling KC extended time for disclosure until 13 June 2025. No disclosure has yet been given by either party, a matter I will return to later. On 7 November 2025 Collyer Bristow applied to come off the record for PEY, which order was granted on 17 November 2025. In the middle of last week, i.e. 10 December 2025, PEY instructed Mishcon de Reya on its behalf. They had reinstructed Mr Friedman of counsel, who settled the amended defence. He filed a skeleton on Friday and appeared before me on Monday. Interpretation of the April Order

17. This is not a consent order as such, although the terms had been agreed between the parties. As is set out in paragraph 40.1.2 of the White Book, the construction of court orders is a single, coherent process. When construing orders, the court should not consider whether or not the order should have been granted, nor should it consider on what terms it should have been granted. The sole issue for the court is what the order means. Words should be given their ordinary meaning, which should then be considered in context. The relevant principles were summarised by Chief Master Marsh (as he then was) in Coward v Phaestos Ltd & Ors [2021] EWHC 9 (Ch) at paragraph [51]. Having referred to a number of decisions, he said: “These decisions establish that: (1) The exercise of construction is to establish what the judge would objectively be understood to have meant by the words used in the order. (2) The general approach to the construction of written instruments or documents is to be applied, with the necessary changes, acknowledging that construing the meaning of an order is distinctly different from constructing a contract or a statute. (3) Snowden J framed the test in Brennan v Prior at [21] as being: ‘The question is what a reasonable person having all the background knowledge, which would have been available at the time to the maker of the document would have understood [the judge] to be using the language in the document to mean …’. (4) He went at [22] to set out the test to be found in the judgment of Lord Neuberger in Arnold v Britton at [15]. [2015] 2 WLR 1593 (5) The subjective intentions of the parties are not admissible and strictly the subjective intention of the judge is not admissible unless it is sought to amend the order under the slip rule.”

18. The exercise of construction, therefore, is to establish what the judge would objectively be understood to have meant by the words used in the order. The process is similar to the well-established principles of contractual construction but not identical.

19. The most important part of the background in my judgment was that this was an application to amend by the Claimants which would necessitate consequential amendments to the Defence. Courts do not usually make orders granting blanket permission to amend. That is not to say they cannot, but I did not have any case drawn to my attention where that has actually been done. The courts will grant permission to amend either in a form which has been agreed by the parties or in a form which the court rules on if the parties cannot agree. For the court to grant an application to amend, it has to be satisfied with the merits of the claim sought to be introduced by the proposed amendment, as helpfully set out by the Court of Appeal in Kawaskai Kisen Kaisha Ltd v James Kemball Limited [2021] EWCA Civ 33 at paragraphs 16 to 18 under the heading “The merits test”, where it was said: “16. It was common ground that on an application to serve a claim on a defendant out of the jurisdiction, a Claimant needs to establish a serious issue to be tried, which means a case which has a real as opposed to fanciful prospect of success, the same test as applies to applications for summary judgment: Altimo Holdings and Investment Ltd v Kyrgyz Mobil Tel Ltd [2102] 1 WLR 1804 per Lord Collins JSC.

17. The Court will apply the same test when considering an application to amend a statement of case, and will also refuse permission to amend to raise a case which does not have a real prospect of success.

18. In both these contexts: (1) It is not enough that the claim is merely arguable; it must carry some degree of conviction: ED & F Man Liquid Products Ltd v Patel at paragraph 8; [2003] EWCA Civ 472 Global Asset Capital Inc. v Aabar Block SARL at paragraph 27(1). [2017] 4 WLR 164 (2) The pleading must be coherent and properly particularised: Elite Property Holdings Ltd v Barclays Bank Plc at paragraph 42. [2019] EWCA Civ 204 (3) The pleading must be supported by evidence which establishes a factual basis which meets the merits test; it is not sufficient simply to plead allegations which if true would establish a claim; there must be evidential material which establishes a sufficiently arguable case that the allegations are correct: Elite Property at paragraph 41.”

20. Without seeing the proposed amendment, the court could not be satisfied on the merits of an amendment.

21. On behalf of PEY, Mr Friedman submitted that the April Order should be construed as granting blanket permission. He says that had the parties intended the permission be limited to making consequential amendments, it would have been spelled out in the agreed form of order. I reject those submissions. In my judgment, what HHJ Pelling KC would objectively be understood to have meant by the words used in the order was that permission was granted to the Defendants to make amendments which were consequential on the amendments made by the Claimants, not that the Defendants had permission to make any amendments that they might choose, which on PEY’s submissions might include withdrawal of admissions made. That would have been a very unusual order for the judge to have made. In addition to permission as to the making of consequential amendments being the usual order when an amendment is made, the form of costs order, whereby the Claimants were to be responsible for the costs of and arising from the amendments to the Claim Form and Particulars of Claim, is the usual order where permission to make consequential amendments is granted.

22. The initial position of Collyer Bristow on behalf of PEY following the making of the order was that they were entitled to make consequential amendments but if they wanted to include non-consequential amendments, they would need the agreement of the Claimants and in default would need permission of the court. The Claimants agreed with this. While this is conduct which post-dates the making of the order and therefore is not in itself capable of assisting the interpretation of the order, it confirms in my judgment that the objective understanding of the order was that the permission granted was limited to consequential amendments. It was only later there was a change of position by Collyer Bristow to say it was a blanket permission to amend.

23. Mr Friedman next submitted that even if the April Order is limited to consequential amendments, as the second and third Claimants were new parties, no Defence had been pleaded by the Defendants in respect of their claims, such that the permission for consequential amendments necessarily included permission to plead any defence that the Defendants might want to run in respect of the claims by the second and third Claimants. Such a Defence would, he submitted, be consequential on the addition of the second and third Claimants.

24. In my judgment in this case that is not correct. If that was the effect of the April Order, the Defendants would be able to run completely inconsistent defences as regard different Claimants whose claims as to liability were identical. The judge cannot have contemplated that. The proper interpretation of the April Order did not extend that far; rather, it was limited to the amendments as to quantum, which was the reason for the amendments adding the second and third Claimants.

25. Accordingly, in my judgment, PEY did not have permission to make any amendments which went beyond amendments which were consequential to the amendments to the quantum claim of the Claimants. Insofar as the amendments went beyond that, permission of the court was needed and has not yet been given. Withdrawal of Admissions

26. The first question is whether an admission has been made which the party who made it is seeking to withdraw. I refer to what Popplewell J (as he then was) stated in Bayerische Landesbank v Constantin Medien AG [2017] EWHC 131 (Comm) at paragraphs 22 – 23: “22. When considering withdrawal of a plea, different considerations arise depending on whether what is to be withdrawn is an admission or an averment. In relation to an averment which a party wishes to pursue, the party is concerned not merely with whether the averment is true, but also whether and how it can be proved. On the other hand, in relation to an admission in response to an averment by the opposite party, what the party is concerned with is simply whether what is alleged against it is true. No question arises of it being able to prove or disprove the allegation evidentially, distinct from the question as to whether the allegation is or is not true.

23. It seems to me, therefore, that the first and important question in this case is to identify what aspects of proposed amendments are properly characterised as withdrawals of admissions and what aspects are merely withdrawals of averments.”

27. I was referred by Mr Langley to Sabbagh v Khoury [2019] EWHC 3004 (Comm) at paragraph [48], a decision of HHJ Judge Pelling KC, and to Ahmad v Ouajjiou [2023] EWHC 266 (Comm) , a decision of Jacobs J, and in particular to paragraphs [108] to [111]. These are illustrative of what might or might not amount to admission on the facts of a particular case, but do not in my judgment lay down any binding principles.

28. It is common ground between the parties that if an admission had been made, the court would consider the factors in CPR 14.5 in deciding whether to give permission to withdraw the admission. CPR 14.5 provides: “In deciding whether to give permission for an admission to be withdrawn, the court shall consider all the circumstances of the case, including— (a) the grounds for seeking to withdraw the admission; (b) whether there is new evidence that was not available when the admission was made; I the conduct of the parties; (d) any prejudice to any person if the admission is withdrawn or not permitted to be withdrawn; I what stage the proceedings have reached; in particular, whether a date or period has been fixed for the trial; (f) the prospects of success of the claim or of the part of it to which the admission relates; and (g) the interests of the administration of justice.”

29. The various factors are to be considered as a whole, and there is no rigid hierarchy; see the Bayerische case at paragraphs [52] to [54], quoting in particular from the judgment of Ward LJ in Woodland (by her litigation friend) v Stopford [2011] EWCA Civ 226 at paragraph [26]. In the Bayerische case at paragraph [55], Popplewell J said: “The extent and nature of the explanation which a party is willing to give for the change of position may be constrained by questions of legal professional privilege. As is well known, a party is not bound to waive privilege, and no adverse inferences are to be drawn merely from the fact that the party insists on maintaining privilege, which is a legal entitlement. Nevertheless, the court has to decide an application under Rule 14.5 on the evidence which is before the court. If the evidence which the party seeking to withdraw an admission chooses to put forward in support of that application involves an explanation which is inadequate or unsatisfactory or in some way deficient, then that is a factor which the court will take into account as one of the considerations when dealing with a factor which is enumerated under sub-paragraph (a) of Rule 14.5.”

30. I was taken by Mr Langley to Clarkson v Future Resources FZE & Ors [2022] EWCA Civ 230 at paragraphs [35] to [36], and then again at [45] to [49]. Mr Langley laid particular emphasis on what was said at paragraph [45], where Simler LJ (as she then was) said: “… it is fundamental to an application of this kind that the judge is given a full and frank explanation of how things have gone wrong, and the basis on which the admission is to be withdrawn. This should include how the admission came to be made in the first place and the grounds upon which the applicant seeks to withdraw the admission, including whether or not new evidence has come to light which was not available at the time of the admission.”

31. She went on at paragraphs [47] to [49] to say: “47. The signing of a statement of truth is no empty formality. Its importance is emphasised by the potential liability for contempt of court if signed without an honest belief in its truth. At interlocutory stages a statement of case, verified by a statement of truth, is itself evidence of the truth of the facts alleged in it: CPR Part 36 (2) (a). It therefore carries considerable weight. Conversely, the letter [in that case] carried no such weight. Furthermore, the fact that none of the affected MC defendants responded promptly (or at all) to the Asertis application for summary judgment on the admissions they had made, was never explained. If an error was made, it is inconceivable that this application did not alert the MC defendants to it. They had months to file witness evidence (verified by a signed statement of truth) but failed to do so.

48. Finally, there was nothing to explain the grounds upon which the withdrawal of the admissions was sought; the MC defendants (including Mr Boswell and Mr Unsworth) had admitted receiving the relevant funds, and they did not apply for permission to withdraw those admissions. Having admitted receipt of those funds, there was no explanation why they were not liable to repay them. The judge would have been entitled to understand the positive case being advanced by the MC defendants, who had admitted liability for almost £1m; but no explanation was ever provided.

49. For all these reasons, I have no doubt that the judge was correct to reject this application for the reasons he gave, and I would therefore dismiss this ground of appeal.”

32. Mr Friedman did not take issue with Mr Langley’s submissions as to the applicable law, but referred me to the decision of Fancourt J in a patents case, Anan Kasei Co Ltd & Anor v Neo Chemicals & Oxides Ltd [2020] FSR 8 , and in particular to paragraphs [49] to [54] and [60] to [66]. In that case, the defendant, Neo, sought to withdraw admissions that had been made. It accepted that it was at fault for having proceeded with a case involving significant admissions when it wished to pursue a different case, and for not having sought to formally regularise the position for four and a half years. That was not a case of new evidence having come to light that justified a different defence, or the Claimant being in any way responsible for the course taken by Neo. There was no evidence on behalf of Neo that explained why the admissions were made in the terms they were, at what stage Neo decided it wished to run a case that was inconsistent with the admissions or why the matter was not addressed before it was. The evidence on behalf of Neo simply accepted that the course taken by Neo was “unsatisfactory” and the fault was Neo’s.

33. Notwithstanding those matters, Fancourt J, having come to the conclusion there was a strongly arguable case that Neo’s admissions were wrongly made in law and in the absence of evidence from the Claimant that it had suffered distinct prejudice as a result of relying on the admissions, said he was persuaded by a fine margin that the administration of justice should lead him to the conclusion that he should allow the admissions to be withdrawn on terms as to costs. In paragraph [63] he said that he considered it “material that the admissions encompass important points of general law and not merely facts within the knowledge of Neo on which Neo previously formed a considered opinion but now wishes to change its mind”.

34. Mr Friedman relies on this to show that even if there was no explanation as to how things have gone wrong and a basis on which the admission is to be withdrawn, which Simler LJ subsequently described as fundamental in the Clarkson case, the court could still permit an admission to be withdrawn.

35. In my judgment it must be correct, given there is no rigid hierarchy among the circumstances that have to be considered or any threshold condition, that it is open to the court to allow withdrawal of an admission where there is no explanation given as to how things have gone wrong. However, given the fundamental relationship of such an explanation to an application to withdraw an admission, such a case will be an exceptional one. Was there an admission in this case?

36. Mr Friedman on behalf of PEY says there was no relevant admission. Mr Langley says it is plain that there was. For the reasons set out below, I have no hesitation in finding that there has been a relevant admission. That admission was that if State Aviation is liable, PEY is liable to the same extent.

37. Paragraph 4 of the Particulars of Claim pleads the lease agreement between the Claimants and State Aviation. In Paragraph 5 of the Particulars of Claim, it was pleaded and remains pleaded in the amended Particulars of Claim that “State Aviation’s obligations under the lease agreement were guaranteed by PEY under a deed of guarantee and indemnity dated 31 October 2023 between PEY and the first Claimant. The guarantee is governed by English law”. Having set out the liability of State Aviation under the lease agreement, the Particulars of Claim pleads at paragraph 33: “Further or alternatively, 33.1 PEY is liable as primary obligor in respect of the sums claimed above under clause 2.3 of the guarantee; and/or 33.2 PEY is required to indemnify the Claimant in respect of the sums claimed above under clause 2.4 of the guarantee.”

38. This is, in my judgment, a clear allegation that PEY guaranteed all of State Aviation’s obligations under the lease agreement.

39. In the original defence, paragraph 5 stated “paragraph 5 [of the Particulars of Claim] is admitted” without any qualification at all. At paragraph 33 it was pleaded, “As to paragraph 33 [of the Particulars of Claim], PEY’s liability under the guarantee is co-extensive with that of State Aviation”.

40. The only defence as to liability being run by State Aviation was that Mr Christopher ultimately on behalf of the Claimant and Mr Abdullah of State Aviation had agreed there would be a rent holiday under which payments under the lease agreement would be suspended until certain trigger conditions had been met. Those trigger conditions, it is pleaded, had not been met by the time the Claimant presented an invoice for payment, the non-payment of which therefore did not amount to a breach of the lease agreement. Accordingly, there had been no event of default which entitled the Claimant to terminate the lease agreement and bring the lease agreement to an end. That is the matter which will have to be determined at trial.

41. In these circumstances, in my judgment, PEY was admitting the guarantee and that it was liable if and only if State Aviation was liable, the extent of PEY’s liability being the same as that of State Aviation. Paragraph 33 of the Defence was not an averment, properly so called, but was an admission as to the extent of the liability of PEY. This is confirmed in the list of common ground at paragraph 14, where it is said, “PEY’s liability under the guarantee is co-extensive with that of State Aviation. Accordingly, if State Aviation is liable to the Claimant, PEY is also liable to the Claimant to the same extent”. Is permission required to withdraw the admission?

42. Mr Friedman says that even if this is an admission, it is not a relevant one as it is limited to liability under the guarantee. He submits the case that PEY now seeks to run does not cut across that admission, and therefore PEY does not need permission to withdraw the admission.

43. The new case is set out at paragraph 5 of the amended defence, where it now says, “Paragraph 5 is admitted save that the parties to the guarantee agreed that the guarantee would extend only (and be enforceable by the first Claimant only) in circumstances where State Aviation was unable to pay as a direct result of foreign exchange (forex) restrictions, but not otherwise”. It then gave specifics in eight sub-paragraphs over two pages: “(1) State Aviation and Thora Capital entered into a Helicopter Lease Proposal on 14 April 2023, which envisaged that State Aviation would enter into a lease arrangement for the Helicopter. (2) At the material times, Tanzania was facing significant foreign exchange constraints due to a shortage of USD in Tanzania, and there were currency controls in place that made it difficult for local companies to obtain and remit USD to foreign entities (the “Forex Issue”). Mr Amour Abdallah of State Aviation explained the Forex Issue to Mr Russell Christopher of Thora Capital (which acted as agent on behalf of the First Claimant and had authority to bind the First Claimant to agreements) in a WhatsApp message dated 4 May 2023. Mr Abdallah indicated that State Aviation “should be able to manage”. (3) However, it became apparent that the Forex Issue might in fact make it problematic for State Aviation to make payments. In mid-July 2023, Mr Christopher and Mr Moshe Schlisser of PEY discussed possible methods of resolving the Forex Issue. PEY was involved in those discussions because (through a subsidiary) it is a licensed foreign exchange dealer in Tanzania and also because it had previously facilitated cross-border payments for State Aviation on a smaller scale. PEY is incorporated and based in Singapore and did not face equivalent difficulties in making payments in USD. PEY also operated at the material times other businesses in Tanzania and was able to use Tanzanian shillings (“TZS”), and so it was prepared to provide USD on behalf of State Aviation in return for the receipt of TZS from State Aviation at a favourable margin. Mr Christopher proposed that PEY agree to step in and make payments on behalf of State Aviation to the extent (only) that the Forex Issue prevented State Aviation from making those payments. (4) While PEY and State Aviation did subsequently come under (partially) common ownership, at the time of the discussions, PEY had no ownership interest in State Aviation. As such, PEY was willing to provide only limited assistance in relation to the facilitation of payments by State Aviation in return for the (limited) benefit of receiving TZS at a favourable margin. PEY’s obligation was solely to deal with the Forex Issue, on the basis that it would make payment in USD and then would be reimbursed by State Aviation. The risks for PEY therefore would be extremely low and its obligations were restricted. (5) In a further telephone discussion on or around 17 October 2023 between Mr Christopher and Mr Schlisser, a short period of time prior to the Guarantee being executed, it was discussed and agreed that PEY would provide the limited function of making payments in USD in the event that the Forex Issue meant that USD were not available to State Aviation. Mr Christopher stated that Thora Capital’s standard form guarantee should be used “for internal purposes”, because having a guarantee on file would help satisfy Thora Capital’s internal credit and investment committees, given the known difficulties in doing business in Tanzania. However, Mr Christopher stated, and he and Mr Schlisser agreed, that the Claimants would not invoke the Guarantee except in the event that (and only to the extent that) State Aviation was unable to make payments due to the Forex Issue. Mr Christopher’s proposal was agreed by Mr Schlisser on behalf of PEY on the same call. (6) By virtue of the foregoing, the Claimants and PEY entered into a collateral contract (the “Collateral Contract”) to the effect that the Claimants could and would enforce the Guarantee against PEY only if, and only to the extent, that State Aviation was unable to make payments because of the Forex Issue, but not otherwise. (7) Further or alternatively, the Claimants are estopped by representation from relying on the full terms of the Guarantee. Mr Christopher on behalf of the First Claimant represented by words and/or conduct that PEY would not enforce the Guarantee save to the extent that State Aviation was unable to make payments because of the Forex Issue. That representation was intended to induce PEY to sign the Guarantee. PEY signed the Guarantee in reliance on that representation. PEY would suffer detriment if the First Claimant is not held to its representation, in that its potential liability under the Guarantee would be significantly higher than the liability it agreed to bear. Further or alternatively, an estoppel by convention arises on the basis that the parties’ understanding, manifested between them, was to the same effect (and PEY relied on that representation to its detriment for the same reasons) (together, the “Estoppel”). (8) Further or alternatively, as a result of the statements pleaded above, Mr Christopher on behalf of the First Claimant represented to PEY that its present intention at the time of signing the Guarantee was that it would not enforce the Guarantee save to the extent necessary to deal with the Forex Issue (and not otherwise) (the “Representation”). That Representation was false: it is to be inferred from the Claimants’ conduct in seeking now to rely on the Guarantee as against PEY that the First Claimant intended to rely on the Guarantee in the manner it now has (that is, to seek to recover all payments allegedly owing by State Aviation under the Lease Agreement from PEY regardless of whether non-payment was caused by the Forex Issue). Mr Christopher made the Representation carelessly, without believing or having reasonable grounds for believing it was true. The Representation was intended to be relied on, and was relied on by PEY. It therefore induced PEY to enter into the Guarantee (the “Misrepresentation”).”

44. They add an allegation of a collateral contract and estoppel and a misrepresentation. On its face, it appears to be a withdrawal of an admission by way of a very substantial qualification of the admission of paragraph 5 of the Particulars of Claim. But that is not the only amendment. There are also substantial amendments at paragraph 19.4, 19.5 and 20.5 where it is pleaded that: “(4) It is in any event denied that PEY was in breach of the Guarantee. The alleged breaches by State Aviation were not the result of the forex issue, and accordingly the Claimants are prevented from enforcing the guarantee against PEY by reason of misrepresentation, the collateral contract and/or the estoppel. 19.4.1 Specifically by virtue of the misrepresentation, PEY is entitled to rescind, and hereby rescinds the guarantee, such that it is not obliged to make payments under it. Further or alternatively, it has a corresponding claim in damages at common law and/or pursuant to section 2(1) of the Misrepresentation Act 1967 , which it sets off against, and which extinguishes, any sum found owing; further or alternatively 19.4.2 , in claiming any such sums, the Claimants are in breach of the Collateral Contract, such that they cannot claim for any such sums, further or alternatively, PEY has a corresponding claim in damages equal to those sums, which it is entitled to set off against, and which extinguishes any sums found to be owing, further or alternatively 19.4.3 the Claimants are estopped from claiming any such sums from PEY. 19.5 In any event, PEY was not under an obligation to ensure that State Aviation could comply with ‘all payment obligations’ under the lease. In fact, it was only obliged to make payments in the event that State Aviation was unable to make them due to the forex issue. […] 20.5 Regardless, PEY was only obliged to make payments pursuant to the guarantee in the event that State Aviation was unable to make them due to the forex issue. Paragraph 19 above is repeated mutatis mutandis.”

45. There are also amendments to paragraph 33, which now reads: “As to paragraph 33, PEY’s liability under the guarantee (were it is to apply), is co-extensive with that of State Aviation, the matters referred to in response to paragraph 31 apply equally. In any event, the guarantee has been rescinded, further or alternatively, PEY has no liability to any claim under the guarantee other than in relation to the forex issue, and paragraph 19 above is repeated mutatis mutandis.”

46. Mr Friedman’s submission is that PEY is continuing to admit co-extensive liability under the guarantee but now seeks to set up the claims of collateral contract, estoppel and misrepresentation, each of which has the effect, so it is pleaded, of preventing the Claimants from recovering from PEY as there has not been non-payment by State Aviation by reason of the forex issue. Each of those lines of defence, with the exception of the claim that the guarantee has been rescinded due to misrepresentation, can only work, so he submits, on the basis of the existence of the guarantee and liability under it but which the Claimants cannot recover for.

47. In my judgment, the argument that this is not a withdrawal of admission is devoid of merit. It is plain, in my judgment, that PEY had admitted that if State Aviation was liable, then PEY was liable for the same sums. By now saying that PEY’s liability only arose in the event of non-payment by State Aviation because of a forex issue, PEY is saying the opposite of what they had previously admitted and saying that if State Aviation is liable, PEY is nonetheless not liable. That is inconsistent with the original defence and in my judgment amounts to a clear withdrawal of an admission by PEY. It follows that if PEY are to be permitted to run this defence, they require the permission of the court to withdraw the admission. Should permission be given to withdraw the admission?

48. It is necessary to consider the factors in CPR 14.5. As to subparagraph (a), namely the grounds for seeking to withdraw the admission, this is a case where I have not been given a full and frank explanation of how things have gone wrong and the basis on which the admission is to be withdrawn, including how the admission came to be made in the first place and the grounds upon which the applicant seeks to withdraw the admission, including whether or not new evidence has come to light which was not available at the time of the admission.

49. The only evidence adduced in support of the application to withdraw the admission for which application was made, if contrary to PEY’s primary case the court determined, as I have, that PEY does not have permission to rely on the amended defence under the April Order, was the witness statement of Nicola Leach of Collyer Bristow dated 17 July 2025. At paragraph 55, addressing CPR 14.5(a), Ms Leach said: “The grounds for seeking to withdraw the admission are that without the amendments, PEY’s pleaded case does not reflect what was agreed between PEY and the first Claimant at the time of agreeing the guarantee. PEY is now individually represented, having identified a conflict of interest between PEY and State Aviation. PEY has considered its position on its own account with the benefit of new solicitors and counsel. Privilege in respect of any discussions is not waived, and the amended Defence represents its case as to its liability to the Claimants.”

50. This does not, in my judgment, begin to be the sort of explanation that the court is entitled to expect. As set out above, a party is not obliged to waive privilege, and no adverse inference can be drawn from PEY having not done so, but I can only determine this on the evidence before me.

51. On Friday 12 December 2025, i.e. the working day prior to the hearing, PEY served a witness statement from Mr Moshe Schlisser, who is the person who claims to have had the discussions with Mr Christopher about the forex issues and reached the agreement limiting the recoverability under the guarantee. The witness statement was said to be made in support of PEY and “to give an overview of the reasons for the timing of the second defendant’s provision of disclosure”. It is noticeable that Mr Schlisser does not go into any detail in this witness statement about the oral conversations it is alleged in the amended Defence that he had with Mr Christopher. What he does say in paragraphs 5 to 7 is: “5. At the outset of this dispute, the first Defendant and PEY were jointly represented by Reed Smith LLP. For the reason set out at paragraph 4 above, PEY was heavily reliant on the advice of LLP [the reason in paragraph 4 was his being unfamiliar by being an Israeli citizen living in Tel Aviv and having no familiarity with the court process in England and Wales].

6. In April 2025 a potential conflict of interest between the first Defendant and PEY was identified, as a result of which Reed Smith ceased to represent PEY.

7. Shortly thereafter and on 22 April 2025, PEY instructed Collyer Bristow LLP. Again, for the reason set out at paragraph 4 above, PEY was heavily reliant on the advice of Collyer Bristow LLP. This was the first time that PEY obtained advice by and for itself rather than jointly with State Aviation. It was as a result of certain advice from Collyer Bristow LLP, privilege is not waived, that I first came to appreciate the oral conversations I had had with Mr Christopher of the Claimants gave PEY a further defence as a matter of law. As I explained above, I am not experienced in or knowledgeable of English law.”

52. This is very carefully worded. He does not say he only remembered the alleged conversation with Mr Christopher shortly before the amended Defence was settled. He does not say whether he did or did not raise this alleged conversation with Reed Smith when they were the solicitors acting for PEY as well as State Aviation. While he is not obliged to do so as, strictly speaking, discussions between him and Reed Smith would be a matter subject to privilege, given that he has raised the alleged conversation with Collyer Bristow and counsel such that they were pleaded, there is no logical basis for him not to have told the court whether or not he raised this with Reed Smith. While Mr Friedman sought to defend this on the basis that the witness statement was serving a different purpose, that is not in my judgment an adequate or understandable reason for the lack of the explanation the court expects and is entitled to receive.

53. As to CPR 14.5(b), it is common ground that there is no new evidence that was not available when the admission was made.

54. As to CPR 14.5I, namely the conduct of the parties, there can be no criticism of the Claimants’ conduct in this regard. Mr Friedman sought to suggest that because the Defendants have been cooperative in respect of the amendments sought to be made by the Claimants, the Claimants should be criticised in some manner for not being cooperative in the same way. There is nothing in this. The Claimants are fully entitled to say they were not prepared to agree to the withdrawal of admission and a complete change of case.

55. I accept Mr Langley’s submission that the relevant conduct is that of PEY. They are entirely to blame for the making of an admission which they now say they should not have made. They have not accepted they needed permission to withdraw the admission, but rather sought to rely on an incorrect interpretation of the April Order which they have persisted with at all times. Their application for permission to withdraw was only made in response to the Claimants’ application for a declaration that they are not entitled to rely on the non-consequential parts of the amended Defence.

56. As to factor (d), prejudice to either party, this is connected to the strength or otherwise of the case which PEY now wishes to run. If it is a very strong case, depriving PEY of the opportunity of running it will cause PEY prejudice. If it is not a strong case, there is less prejudice to PEY. I will address this in due course. As to the position of the Claimants, it is right to note they have not pointed to any particular prejudice that they have suffered as a result of reliance on an admission, for example that they have adopted a course they would not have adopted had they not known of the admission.

57. As to factor I, the parties are agreed that if the admission were to be withdrawn, it would not affect the trial date or the trial length, that is to say, the trial date is not put at risk, and the issues raised by the new case withdrawing the admission could be accommodated within the time set aside for the trial.

58. Factor (f) refers to the prospects of success of the claim or the part of it to which the admission elates. It does not refer to the prospects of success of the defence in the event of the admission being withdrawn, but that appears to have been how the factor has been treated.

59. Factor (g) refers to the interests of the administration of justice. Mr Friedman equates this with the overriding objective, but given that the overriding objective is always a matter to be taken into account in any procedural decision, it would seem unnecessary for it to be repeated in different wording in this Rule. On the facts of this case, this factor does not in my judgment add much.

60. Before determining therefore whether permission to withdraw the admission should be granted, it is necessary in order to reach conclusions on factors (d), (f) and (g) to consider the prospects of success of the proposed amendment. This is intrinsically linked with the question of whether permission should be refused on the grounds that the objected-to parts of the amended defence have no realistic prospects of success. However, even if I were to conclude the objected-to parts do have realistic prospects of success, it would not necessarily follow that permission to withdraw the admissions would be granted. If that were the case, the other factors listed in CPR 14.5 would be irrelevant. All the court would be concerned with would be whether there were realistic prospects of success, and the reasons for the making of the admission which is sought to be withdrawn and the other factors would be irrelevant. Should permission be refused on the grounds that the objected-to parts of the amended Defence have no realistic prospects of success?

61. I return to what both counsel submitted was a very important factor here, namely whether the defence now sought to be run has reasonable prospects of success. The withdrawal of the admission is not limited just to the withdrawal of admission, but includes the advancing of a new case by way of amendment. If that amendment does not satisfy the merits test for an amendment, then it would not be proper to allow the amendment and therefore to allow the withdrawal of the admission.

62. As I have already identified, the merits test is that set out in Kawasaki case at paragraphs [16[ to [18]. This is not identical to the summary judgment test, and the amendment must not be merely arguable, it must carry some degree of conviction. It must be coherent and be properly particularised. It must be supported by evidence which establishes a factual basis which meets the merits test. It is not sufficient simply to plead allegations which, if true, would establish a claim. There must be evidential material which establishes a sufficiently arguable case that the allegations are correct.

63. Like an application for summary judgment, the court is not to involve itself in a mini trial, but that does not mean the court must take at face value without analysis everything that the party says in statements before the court. In some cases, it may be clear that there is no real substance in the factual assertions made, particularly if contradicted by contemporaneous documents; see ED&F Man Liquid Products Ltd v Patel [2003] EWCA Civ 472 at [10]. The court has to evaluate the evidence in order to determine if there is a real prospect of success.

64. Mr Langley took me to two earlier decisions, that of David Foxton, QC (as he then was) sitting as a deputy High Court judge in Astilleros Canarios SA v 3264741 Nova Scotia Limited [2017] EWHC 2194 (Comm) and of Briggs J (as he then was) in Carey Group Plc v AIB Group (UK) Plc [2011] EWHC 594 (Ch) , where the judges respectively granted summary judgment and refused an application for permission to amend on the grounds that the new defence was highly improbable or inherently implausible. Mr Langley sought to draw comparisons between those cases and this one. Each of those cases was a short judgment on the facts of the respective case. Neither sought to lay down any principles, but rather each was an application of principles. While illustrative of the approach taken on applications for summary judgment and permission to amend, in my judgment, and without intending any disrespect or in any way disagreeing with the outcomes in those cases, they do no more than that. I have to consider whether the new defence which is sought to be run is one with realistic prospects of success.

65. Mr Friedman submits the new defence has real prospects of success and it would be wrong to deny PEY for running this defence at trial. The new defence of paragraph 5 sets out the forex issue, says there was a discussion between Mr Schlisser and Mr Christopher about this in mid-July 2023, sets out PEY’s position as someone which could in effect run the equivalent of a foreign exchange bureau and then asserts an oral agreement reached on 17 October 2023 between Mr Schlisser and Mr Christopher. That oral agreement was: “… that PEY would provide the limited function of making payment in US dollars in the event that the forex issue meant that US dollars were not available to State Aviation. Mr Christopher stated that the standard form of guarantee should be used for internal purposes, because having a guarantee on file will help satisfy Thora Capital’s internal credit and investment committees, given the known difficulties of doing business in Tanzania. However, Mr Christopher stated, and he and Mr Schlisser agreed, that the Claimants would not invoke the guarantee except in the event that, and only to the extent that, State Aviation was unable to make payments due to the forex issue. Mr Christopher’s proposal was agreed by Mr Schlisser on behalf of PEY on the same call.”

66. While Mr Schlisser does not address this at all in his witness statement on 12 December 2025, he did verify the amended Defence of the statement of truth, and a pleading endorsed with a statement of truth is a statement of fact for the purposes of an interim hearing.

67. Mr Friedman says that Mr Schlisser’s assertion of an oral agreement is supported by WhatsApp messages between firstly Mr Christopher and Mr Abdullah in May 2023 and secondly Mr Christopher and Mr Schlisser in July and October 2023. He says that this makes commercial sense given what is stated to have been PEY’s position in paragraph 7(4) of the amended defence. He took me to the WhatsApp messages. The exchange between Mr Abdullah and Mr Christopher relied on is one from 4 May 2023 in the following terms: “4 May 2023 at 20.08.45 Mr Abdullah : Hi Russ. Sorry, I’ve just seen this text now. We initiated it yesterday but it is going to take a few days. There is a big and frustrating challenge in our country currently to buy United States dollars, and they have put at an individual limit of $5,000 per day. I will send you the docs we use at the bank to request for a transfer for your records. RUSSELL: Okay, thanks. That must be annoying for you. AMOOR [MR ABDULLAH]: Yeah, very annoying. RUSSELL: Is all your revenue in local currency? How do you propose to pay dollar rent on a monthly basis? AMOOR: Like 30 per cent is usually in US dollars, but this situation has never happened before for the past five years. So far, we have decided to prioritise usage of TZS [Tanzanian shillings] only for our usual OpEx. With proper currency exchange planning, we should be able to manage a BSC. It is only 150K monthly sets within the limit. RUSSELL: Okay, sounds good. Thanks.”

68. While that reference references potential issues with forex, it does not mention any other party guaranteeing payment or acting as a foreign exchange bureau. As to the exchange between Mr Christopher and Mr Schlisser, I was taken to the one on 15 July, which reads as follows: “ Mr Schlisser : Hey Russell, happy Saturday. The currency shortage is still there. However, we put together a comprehensive solution to that, which will be rolled out shortly. RUSSELL: Thanks, Moshe. Please provide details of solution.”

69. Then on 17 July: “ Mr Schlisser : Good morning. Let me know when you’re up and I will walk you through it. RUSSELL: I am free now.”

70. And then there is reference to a missed voice call. If there was a call at this time, it would appear not to have been by WhatsApp as there is only this one reference to a missed call.

71. I was then taken to a further exchange on 17 October 2023: “RUSSELL: Hi Moshe, are you available to talk? MR SCHLISSER: Can I call in 30 minutes? RUSSELL: Yep.”

72. There is no reference to a WhatsApp call. So if there was a call, it must have taken place by other means. The WhatsApp messages of 17 October do not mention forex, and there is nothing in the WhatsApp messages after 17 October referring to the agreement said to have been made on 17 October, in particular in the period January to March 2024, which is the period during which demands were being made for payment.

73. Mr Friedman further submitted the Mr Schlisser’s account has never been challenged by Mr Christopher. He submitted that what had happened was a clever attempt to avoid putting pen to paper to actually respond to this. He said that this could only have been done deliberately, that that was a fair inference to be drawn, supported by the fact the Claimants had not served an amended Reply when they should have done. He criticised the evidence of Mr Fox of Clyde & Co for the Claimants, saying he did not say that Mr Christopher had told them that this agreement was disputed, because if Mr Christopher had said this to Mr Fox, Mr Fox would have had to say so and to have identified Mr Christopher as to having done so. He said this lack of dispute distinguished it from the Astilleros decision.

74. As to the board minute of PEY recording the resolution that it was in the interests of PEY to enter into the guarantee and undertake the obligations under the same and the approval of the form and contents of the guarantee, which makes no mention of the agreement said to have been reached with Mr Christopher, Mr Friedman said that this was “papering” for the benefit of the Claimants and their ability to satisfy their credit committee. He says that is therefore not inconsistent with the new defence.

75. He took me to the judgment of Gloster J (as she then was) on the summary judgment application in Dallah Al Baraka Investment Company v Metal Distributors (UK) Limited [2004] EWHC 2008 (Comm) at paragraph [12] for the proposition that: “There is indeed a principle of law which established that courts are, in some circumstances, prepared to treat a statement intended to have contractual effect as a separate contract or warranty collateral to the main transaction and moreover prepared to do so even in circumstances where the alleged collateral agreement is wholly inconsistent with the expressed terms of the agreement.” Although he did not refer to the final phrase that “there needs to be clear evidence to support such a defence”. In that case, Gloster J went on a paragraph [21] to say the defence of a collateral contract did not bear scrutiny, it being wholly inconsistent with the contemporaneous documents and payments which had been made.

76. Mr Langley submits there is no realistic prospect of the new defence succeeding. In answer to the point that Mr Christopher does not dispute the agreement that is said to have been reached on 17 October 2023, he took me to the letter of 11 June 2025 from Clyde & Co to Collyer Bristow, which was the immediate response to service of the amended defence. At paragraph 4 of that letter Clyde & Co wrote: “Further proposed amendments are hopeless, and you have not supplied any evidence corroborating their factual premise. We have seen a copy of the board resolution of PEY, which makes no reference to the forex issue. The factual premise of the proposed amendments is entirely inconsistent with the basis on which the board of PEY approved and executed the guarantee, i.e. on the basis of PEY’s obligations as set out in the written document. We are instructed that Mr Christopher did not make any of the representations alleged. Indeed, it would be contrary to any business common sense for him to have done so.”

77. It is clear, in my judgment, beyond doubt that Mr Christopher had told Clyde & Co that what Mr Schlisser said was not true. The letter was expressly referred to and exhibited to Mr Fox’s witness statement of 1 July 2025 in support of the application to strike out the amended Defence, in which at paragraphs 33(a) and 33(b) he set out why the new defence had no realistic prospects of success. The suggestion in those circumstances Clyde & Co had in their evidence engaged in “a clever attempt to avoid putting pen to paper to actually respond to this” is wholly unsupportable.

78. Mr Langley also relied on the sequence of events in terms of the documents that were executed. The lease agreement was entered into on 21 September 2023. It expressly referred to PEY as a guarantor and as being part of the lessee group. The guarantee was one of the documents defined as a transaction document. It was a condition precedent that there should be a legal opinion from a reputable law firm confirming the authorisation of the guarantee by the guarantor. Mr Langley referred me to other terms of the lease agreement which treated the lessee and guarantor in the same way as regards provision of financial information and events of default. Against the background of this, it was, he submitted, inherently improbable the Claimants would give up their rights, which required the entry into the guarantee of all obligations of State Aviation in a telephone call four weeks later. He points to clause 2.2 of the guarantee, which was an express agreement to treat the entry into the guarantee as satisfaction of the relevant lease agreement condition precedent.

79. Mr Langley further relies on the board minutes of PEY authorising the execution of the guarantee, which made no mention of and is inconsistent with any oral agreement having been reached limiting liability simply to non-payment as a result of the forex issues. That board minute had been referred to in the Clyde & Co letter of 11 June 2025 and was exhibited to Mr Fox’s third witness statement dated 5 August 2025, which was more than four months before Collyer Bristow came off the record. Despite this and notwithstanding that Mr Schlisser put in a witness statement last Friday, there has been no attempt made by Mr Schlisser or anyone else at or on behalf of PEY to address in evidence how it was the board of PEY came to approve entry into a guarantee which was fundamentally at odds with the agreement Mr Schlisser claims to have reached with Mr Christopher.

80. The suggestion made by Mr Friedman that this was entered into in order to help satisfy Thora Capital’s internal credit and investment committees, given the known difficulties in doing business in Tanzania, as pleaded, where it was agreed that it would not be called upon save in respect of the forex issue, is in my judgment an allegation that Mr Christopher was deceiving the credit committee. But Mr Friedman has expressly disavowed any assertion of dishonesty, so this was not a point which he could properly run, Mr Langley submitted.

81. Mr Langley also submits that not a single document has been produced by PEY to support this agreement. They gave no initial disclosure with the amended Defence, stating there was none to be given. It is therefore not PEY’s case that there is any document which supports their position. PEY have not disclosed or pointed to any document between themselves and the Claimant nor any document between themselves and State Aviation which shows the arrangements between them let alone any agreement with State Aviation that they would only guarantee in the event of non-payment for forex reasons.

82. Strikingly, there was no mention of the alleged oral agreement at any time between the first demands for payment in early 2024 and the service of the amended Defence in May 2025. Mr Langley makes the point that this is what he described as a businessman’s issue. It is exactly the sort of thing that one would expect a businessman to raise as soon as a demand for payment was made, regardless of whether it actually gave rise to a defence as a matter of law. There is nothing from PEY in response to the demands for payment saying, we are not liable because the reason that State Aviation has not paid is not because of a forex issue, and as you will remember, you agreed that it was only if that was the reason for non-payment that we would be liable to pay you.

83. In my judgment, the submissions of Mr Langley are to be preferred. It is, in my judgment, inherently improbable that such an oral agreement was reached in circumstances where: (1) there was no mention of this at all until 30 May 2025 when the amended Defence was served, and I agree with Mr Langley this is absolutely a businessman’s point, so that whether or not it amounted to a defence in law is one which, if genuine, would have been expected to have been raised immediately at the outset, even before legal advice had been taken; (2) there is not a single document, recording or evidencing the agreement, whether passing between the Claimants and PEY or even between PEY and State Aviation; (3) the contemporaneous documents, including the guarantee itself and the board resolution, are wholly inconsistent with the alleged oral agreement; and (4) it amounts to an assertion that Mr Christopher, who does deny the agreement, contrary to Mr Friedman’s submission, was lying to his credit committee as to having a guarantee that could be called upon. Whatever PEY’s commercial reasons were for entering into the guarantee, it cannot be said that they could only have been on the basis that PEY were acting as a foreign exchange bureau and nothing more.

84. In my judgment, it follows that the new defence does not meet the merits test for an amendment to be made. It does not stand up to scrutiny and does not have realistic prospects of success. I therefore decline to grant permission to amend in the respects objected to by the Claimants.

85. Feeding this back into the application for permission to withdraw the admission, it follows that application must fail. Factors (d), (f) and (g) all come down in favour of the Claimants in addition to my conclusion on factors (a), (b) and (c).

86. If I were wrong on the merits of the new defence so that it could be said to get over the merits test, it would only have done so by a very small margin. In those circumstances, which are very different to those pertaining in the Anan Kasei case, I would still have refused permission to withdraw the admissions. Unlike that case, this is not one which involves important points of general law. To the contrary, it involves merely facts which must have been within the knowledge of PEY. In the absence of there being any proper explanation of how the admission came to be made, it has to be inferred these are facts on which PEY must previously have formed a considered opinion but now wishes to change its mind. The order for alternative service against State Aviation.

87. Mr Fox has provided a fifth witness statement dated 12 December in support of the application for alternative service. Since Reed Smith came off the record for State Aviation in May 2025, State Aviation has taken no steps in the litigation. It has not provided an address for service within the jurisdiction, and it has not complied with its obligations to serve an amended Defence or as to disclosure. Clyde & Co have been attempting to correspond with State Aviation via the contractually appointed agent for service of process under the lease agreement and via the email address [email protected] , which is the address for notices upon State Aviation specified in the lease agreement. Each application, along with supporting documents, has been sent via these means. There have been no delivery failure notifications in respect of the email address.

88. Further, in June 2025 an attempt was made to deliver the 11 June 2025 letter at the address listed on State Aviation’s website in Tanzania. The process server who attended was told that State Aviation had relocated to Julius Nyerere International Airport Terminal 1. The offices there were closed, and despite making several subsequent attempts, the process server was unable to locate any of the premises. The contact details of Mr Issa Kondecha were obtained and Mr Kondecha advised the team were working from home. After consulting with his superior, Mr Kondecha reported he had been instructed not to accept service of the letter.

89. I have been supplied the report from Charles Kajala-Sengo, a process server in Tanzania, setting out his attempts to serve the documents for the latest application. On 11 November 2025 he had attended the office at the international airport to find it had been demolished and a new structure was under construction. On 12 December 2025 he attended on the location of the current registered address for State Aviation in Dar es Salam, which turned out to be a residential house occupied by an Indian businessman. Nobody in the neighbourhood was aware of the existence of State Aviation. Mr Sengo then detailed further unsuccessful attempts to locate them.

90. In those circumstances, I am satisfied it is appropriate to make an order for service of documents both retrospectively and prospectively as sought. There is no indication that documents served in this manner, in particular via the email address, have not come and will not continue to come to the attention of the appropriate person at State Aviation. Unless order against State Aviation

91. Mr Langley has referred to what Moore-Bick LJ said in the decision in Marcan Shipping (London) Ltd v Kefalas [2007] EWCA Civ 463 at paragraph [36] and to what Lord Neuberger said at paragraph [23] in HRH Prince Abdulaziz Bin Mishal Bin Abdulaziz v Apex Global Management Ltd [2014] UKSC 64 .

92. I accept that State Aviation has deliberately and persistently failed to engage in these proceedings. In light of the fact that the trial of this matter is due to commence in mid-July, it is necessary they should do so. The Claimants are seeking an unless order requiring them to comply with their disclosure obligations by a certain date, in default of which their defence shall be struck out.

93. Given the proposed date for disclosure to be given by PEY is 31 January 2026, that date shall also be the one by which State Aviation must supply their disclosure. The sanction for non-compliance will be they will be debarred from defending the claim. As I mentioned towards the beginning of this judgment, the claim against State Aviation will have to be proved, given the liability of PEY depends on the liability of State Aviation. If the defence of State Aviation were to be struck out, judgment could be entered by the Claimants. However, it is conceivable the Claimants will not make out the case against PEY because of the rent holiday. In such circumstances, it would be wrong in my judgment to have what would amount to inconsistent judgments against State Aviation and PEY. I understand the Claimants are content with this form of order. Epiq Europe Ltd hereby certify that the above is an accurate and complete record of the proceedings or part thereof. Lower Ground, 46 Chancery Lane, London WC2A 1JE Email: [email protected] This transcript has been approved by the Judge