Candy Ventures v Aaqua: Part 20 claim struck out after wholesale failure to comply with court orders

The Commercial Court has struck out a damages claim brought by the insolvent technology start-up Aaqua BV and its assignee, FL Hoes Ventures BV, after finding that both parties had committed sustained and serious breaches of court orders. The judgement of Mr Justice Butcher, handed down on 27 April 2026, is a significant reminder of the court's willingness to exercise its strike-out jurisdiction under CPR 3.4(2)(c) even where no "unless" order has been breached, provided the procedural failures are sufficiently grave.

The Part 20 claim arose from worldwide freezing orders (WFOs) granted by Butcher J in July 2022 on the ex parte application of Candy Ventures SARL (CVS). It was subsequently accepted that those WFOs had been wrongly granted, CVS having materially misrepresented its ability to satisfy the cross-undertaking in damages. The WFOs were discharged in August 2022, and an inquiry as to damages was ordered the following month. The Part 20 claimants alleged that the WFOs had caused a diminution in the value of Aaqua.

The underlying fraud claim — in which CVS alleged it had been induced to invest by false representations made by Aaqua's founder and CEO, Robert Bonnier, about prospective investment from Apple and LVMH — was tried by Bright J in October 2025. Bright J found comprehensively in CVS's favour, awarding damages of £4.6 million and indemnity costs, and making findings that Aaqua had been effectively financed by the sale of Audioboom shares, that its app lacked functionality, and that it had no realistic means of attracting investment other than by misrepresentation.

Long before the fraud trial, the Part 20 claimants had encountered serious difficulties. A tranche of 23,000 undisclosed documents came to light on the eve of the PTR in July 2025. HHJ Pelling KC's subsequent Debarring Order of 1 October 2025 vacated the Part 20 trial and imposed two conditions — payment of agreed costs thrown away and disclosure of the outstanding documents by 7 January 2026 — failing which the claim would be automatically stayed and the Part 20 defendants would have liberty to apply to strike it out.

Neither condition was met. The agreed costs sum of £334,180.26 was not paid by the 17 December 2025 deadline and remained outstanding at the hearing. The disclosure exercise was not completed by January 2026 or at any time before the application was heard in April 2026. The purported explanation — lack of funds — was found to carry little weight. Aaqua's trustee in bankruptcy had assigned the claim to FL Hoes Ventures BV in July 2025, at which point it must have been apparent that funding would be required. No steps were taken to seek litigation funding until February 2026, and even then only a letter from a strategic adviser indicating a "reasonable expectation" that a funder might "engage and potentially offer terms" was produced.

Applying the Denton three-stage framework, Butcher J found the breaches to be of the utmost seriousness. The reasons offered — impecuniosity — were not good reasons, consistent with the Court of Appeal's guidance in R (Hysaj) v SSHD and with ICC Judge Burton's observation in Fletcher and Macpherson v Razeem that impecuniosity alone does not excuse failure to comply with adverse costs orders. All the circumstances, including the prejudice to the Part 20 defendants in bearing unrecouped costs and the indefinite uncertainty hanging over them, weighed in favour of strike-out.

Butcher J declined to grant summary judgement on the merits, finding that questions around issue estoppel — specifically whether Bright J's findings were "necessary ingredients" of the fraud cause of action or merely "subsidiary or collateral" findings — were sufficiently arguable to resist disposal on that basis. The competing expert evidence on valuation methodology presented a further obstacle.

The claim was nonetheless struck out in its entirety on procedural grounds.