In 2016, Mr Andrew Jonathan Milne, described in court papers as “an experienced practising solicitor in the City of London”, took out a series of crowd funded loans facilitated by the peer-to-peer lender Open Access Finance Ltd trading as Unbolted.
Behind these loans were 612 ‘unique lenders’ within which at least 604 were ordinary members of the public. The remaining eight are corporate lenders in so far as the entities who provided the money are understood to be limited companies.
All 612 are currently represented by a single person in litigation brought about by Mr Milne who sought to convince the High Court earlier today that the eight corporate lenders should be separated out and joined as distinct defendants.
Ultimately Mr Milne is seeking to argue that each of the eight corporate lenders “was acting in the course of a business” when they advanced sums using the Unbolted platform.
If this proposed claim could be successfully made out, Mr Milne intends to plead that these now-reclassified ‘commercial lenders’ would by virtue of their commercial status breach certain provisions within the Consumer Credit Act and the Financial Services and Markets Act.
This breach, it was expected to be argued, could “pollute” all 612 Loan Agreements rendering them unenforceable.
Quite a significant claim with potentially huge ramifications across the entire P2P industry.
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Reporting by Daniel Cloake.
The High Court considered this argument in a so-called ‘preliminary issues’ hearing in March 2021. The court ultimately refused to even consider the question. See: “Unbolted: Court refuses to take “treacherous shortcut” across minefield without a map“
The purpose of the hearing today was succinctly summed up by barrister Iain MacDonald, acting for Unbolted and the representative lender: “Should these 8 [proposed] defendants be joined to the claim.“
Mr Milne, appearing remotely as a litigant in person, explained that the threshold by which an entity becomes a commercial lender was so low it was possible to reach “without realising it“, he added “there’s no flashing light bulb which goes off.“
Mr Milne told the court that “people who [invest] tend to be enthusiasts. It’s reasonable to consider that the people who ended up on Unbolted would have tried other platforms first.” This assertion was used to postulate a scenario where amounts invested in his loans on the Unbolted platform had been consistently invested across the entire Unbolted loan book and subsequently across other other platforms. The investing activities of these eight corporate lenders could “run into millions of pounds“.
This was directly contradicted by written submissions made by Professor Anthony Cleare, a director of one of the eight companies who had invested in the Milne loans using the platform. The figures provided by Prof Cleare, on behalf of the company, revealed that the total amount earned from its peer-to-peer activities was only 0.26% of its income over the relevant period of the disputed loans.
Professor Cleare made reference to “the very small sums involved” in his oral submissions to the court in which he asked that the concept of proportionality was taken into account. He also said that “the interest of the corporate lenders are aligned with those of the [individual] lenders” and as a result there was no need to join them as separate defendants to the claim.
Mr MacDonald told the court that the application should be dismissed as it “hasn’t been made out, and is premature at best”. The court was asked to “have a mind in the way proceedings have been conducted to date” with Mr MacDonald referring to a letter sent by Mr Milne in October 2018. A senior procedural judge had previously commented on this letter in the following terms:
It is a letter which has caused me very real concern. The letter is expressed in terms which are both aggressive and hectoring. The approach in the letter clearly suggests that Mr Milne’s objective is to create as much difficulty as possible for the defendant, with a view to destroying it. He says so in terms. Furthermore, he gives clear notice it is his wish that criminal proceedings are brought against the directors and officers of the defendant. In addition, if that were not enough, he raises the spectre of individual lenders being the subject of proceedings which might lead to their bankruptcy.
Mr Milne rejected Mr MacDonalds assertion that his “objective [was] to make these proceedings as complex and as expensive as possible” stating that he had always acted “in good faith“.
In handing down judgment, and outright rejecting Mr Milne’s application, Deputy Master John Linwood explained that the question of whether any of the corporate lenders were acting in a commercial capacity could only be determined at trial.
The judge considered there was “no divergence between the position of the eight and the position of the remainder of the 604” and so “the interests of the current defendants are all aligned“. This meant they would all continue to be represented by the same legal team.
Deputy Master Linwood added that “it does not seem to me to be desirable to add these parties [as separate defendants] as they are already before the court” and that he had to “bear in mind…the need to deal with this litigation justly and at proportionate cost”.
Mr Milne in seeking “disclosure of documents and witness statement evidence far in advance” took matters outside “the ordinary course of litigation and there is no good reason for it“. The court used the words “substantial” and “onerous” to describe the requests of information.
At the end of the lengthy judgment, delivered at astonishing speed, DM Linwood concluded “for all those reasons I dismiss the application.“
After a brief argument on who should pay the legal costs of todays hearing the court found that Unbolted and the representative lender were “entitled” to them as the successful party.
Exactly how much Mr Milne will be required to pay will be determined by the court after receiving written submissions in due course.
The court set out a timetable for exchange of documents and ordered that a Case Management hearing, with a time estimate of 3 hours, should be held on the first available date after April 1st 2023. The claim will have celebrated its forth birthday just a few weeks prior.
Case History
5th March 2019
Claim Form Issued and an Injunction preventing sale of the underlying pledged goods at auction Granted
8th March 2019
Mr Justice Nugee discharged the interim injunction by consent
10th April 2019
The Claimant issued an application for specific disclosure (seeking the details of all lenders), relief from sanctions (for non-compliance with the Consumer Credit Act), and an extension of time for service of his Particulars of Claim to 14 days after the provision of lenders’ details.
22nd May 2019
A hearing before Deputy Master Arkush at which the Claimant’s disclosure application was adjourned, and he was ordered to file and serve draft Particulars of Claim by 2 July 2019 “setting out with appropriate particularity his claims against: a. The Defendant; and b. The lenders on whose behalf the Defendant acts as agent, to include all causes of action on which the Claimant relies”.
10th September 2019
The Claimant’s disclosure application came back before the Court. Chief Master Marsh declined to order disclosure of all lenders’ details, and gave permission for Open Access to act as the representative of all the lenders with whom the Claimant had entered into contracts through the Platform. The Court’s judgment on that occasion is reported online. The Court further ordered that the Claimant was to file and serve an Amended Claim Form by 27 September 2019.
27th September 2019
The Claimant filed his Amended Claim Form to name Open Access as the Second Defendant in a representative capacity.
12th March 2020
There was an appeal against the September 2019 order, which came before Mr Justice Fancourt on 12 March 2020. The judgment on that occasion is reported online. The appeal was allowed to the extent that Mr Marek Szymanski was substituted as the representative for the group of lenders, in place of Open Access, and the details of corporate lenders were to be provided to Mr Milne.
24th March 2020
The matter came before Deputy Master Nurse for a Cost and Case Management Conference. The order on that occasion provided for the adjournment of the CCMC to 3 September 2020. It is clear that this adjournment was to provide the Claimant with an opportunity to advance prospective applications to add further parties (i.e., the corporate entities), and to make consequential amendments to his pleaded case.
21st May 2020
The Claimant applied to join eight (corporate) defendants, and for permission to amend the Claim Form and the Particulars of Claim.
7th July 2020
The First Defendant applied for the determination of a preliminary issue. The time estimate provided on the Application Notice was 3 hours.
4th December 2020
The Court ordered by consent and without a hearing that a CCMC listed to be heard on 7 December 2020 was vacated, and that the Claimant’s application dated 10 April 2019 was adjourned generally
31st March 2021
A 1-day hearing was heard remotely before DM Glover seeking to resolve a preliminary issue.
20th January 2022
The Judgment of DM Glover is handed down by the court. Court refuses to consider preliminary issue.
28th November 2022
Application hearing
Deputy Master Linwood
10:30am
Remote via MS Teams
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
BUSINESS LIST (ChD)
Case No: FS-2019-000004
(1) ANDREW JONATHAN MILNE
-v-
(1) OPEN ACCESS FINANCE LIMITED
(2) MR MAREK SZYMANSKI as representative of those lenders who lent to the Claimant under the loans listed in Annex A to the Particulars of Claim
Mouse in the Court 
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