Lish v The Northern Block Limited - Typeface Copyright and Royalty Dispute Appeal

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2. Mariya Vasilyevna Lish v The Northern Block Limited & Anor

Mariya Vasilyevna Lish v The Northern Block Limited & Anor

[2026] EWCA Civ 497

Mariya Vasilyevna Lish v The Northern Block Limited & Anor

[2026] EWCA Civ 497

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Lord Justice Arnold:

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Introduction

1. This is an appeal by the Claimant (“Mrs Lish”) against an order made by David Stone sitting as a Deputy High Court Judge on 22 August 2025, in so far as it struck out two claims advanced by Mrs Lish as an abuse of the process of the court, for the reasons given by the judge in his judgment of the same date [2025] EWHC 2172 (Ch).

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Factual and procedural background

1. Mrs Lish is a designer of typefaces. She worked with the First Defendant (“TNB”) between 2012 and 2022 designing (or assisting others to design) typefaces. TNB is a type foundry. Part of TNB’s business during that period involved licensing third parties to use the typefaces designed by Mrs Lish (or with whose design she was involved). The Second Defendant (“Mr Hill”) is a director, and the owner, of TNB.

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1. There is a dispute as to whether Mrs Lish was employed by TNB, but it is common ground that, at least in part, Mrs Lish’s engagement by TNB was based on a “Distribution Agreement”, also described as a “License”, dated 20 September 2012 (“the 2012 Agreement”). In the 2012 Agreement Mrs Lish was described as “the Licensor”, and she granted TNB a licence to sub-license “Typefaces” supplied by her. “Typefaces” were defined to mean “all finished typefaces that the Licensor sends to [TNB] with intent to license”. After four years, the agreement could be terminated on 90 days’ written notice.

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1. Among other things, the 2012 Agreement provided that:

i) “Typefaces must be complete and work on all major applications …”.

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ii) “[TNB] will pay the Licensor 60% of sales received by [TNB]’s E-commerce Web and from other unnamed methods of licensing in [TNB]’s distribution network. Payment will be made 30 days following the end of each of [TNB]’s financial quarters and will be calculated on the number of recorded sales.”

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1. It is also common ground that the arrangement was informally varied in about March 2015 (“the 2015 Variation”), but there is disagreement as to the terms of the 2015 Variation. Mrs Lish says that the change was that, rather than receiving the 60% royalty payment quarterly as provided for by the 2012 Agreement, she would be paid a fixed amount each month calculated on past performance plus any further amount due to make up her entitlement to the 60% figure at the year end. The Defendants say that the 2015 Variation involved Mrs Lish foregoing the 60% royalty payments in exchange for an increased salary with a small bonus payment each year.

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1. Both sides rely on two emails sent by Mr Hill. The first is an email to TNB’s accountants dated 5 March 2015 in which he said:

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“[Mrs Lish] has agreed to be paid an annual salary of £27,000.

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If the royalties exceed the £27,000 then she’ll receive them as a bonus at the year’s end.”

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1. The second is an email to TNB’s bookkeeper dated 15 April 2015 in which Mr Hill said:

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“This year after careful discussion [Mrs Lish] has decided to accept a standard monthly salary based on the average sales of the previous two years. I would like her royalties to be reported quarterly as usual and then put into a template that totals up the four quarters. If the annual total is more than her annual salary, then she will be paid out the difference as a bonus at the year end (September 30th).”

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1. It is common ground that Mrs Lish did thereafter receive a small additional payment at the end of each year, which was a rounded figure.

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1. On 17 May 2022 Mrs Lish gave notice terminating the 2012 Agreement with effect from 20 September 2022.

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1. After termination TNB continued to exploit typefaces designed by Mrs Lish, leading to complaints from Mrs Lish. TNB said that Mrs Lish had been an employee of TNB, and therefore it owned the copyrights in the typefaces she had designed in the course of her employment. Mrs Lish said that she had not been an employee, but that, even if she had been, the effect of the 2012 Agreement was that she owned the copyrights in the typefaces she had designed, and therefore TNB was infringing her copyrights.

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1. On 8 July 2022 the Defendants’ then solicitors wrote to Mrs Lish, saying among other things:

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“The [2012 Agreement] ceased to have effect on 1 December 2015, when our client stopped paying your royalty and after which [it] significantly increased your salary. You have been working under this employment arrangement and have accepted the increased salary ever since.”

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1. Mrs Lish’s solicitors replied on 15 July 2022, saying among other things:

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“The only variation [to the 2012 Agreement] concerned our client being paid a flat yearly royalty rate, which coincidentally seems to have been a significant underpayment that has substantially benefited your client to our client’s detriment.”

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1. Mrs Lish’s solicitors wrote again on 29 July 2022, saying:

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“On the basis that you have confirmed your client’s intention to infringe our client’s intellectual property, our client intends to issue proceedings against your client for infringement of those rights and to recover monies owing to it from your client. This is on the basis that your client has not properly accounted to our client for 60% of sales received from exploitation of the fonts. All of our client’s rights are expressly reserved.”

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1. Mrs Lish has given evidence in a witness statement that:

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“Once the dispute with [TNB] began, I did wonder whether they might not have paid me the right amount, but no more than that.”

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1. On 1 November 2022 Mrs Lish commenced a claim against TNB and Mr Hill in the County Court at Newcastle-upon-Tyne (claim number J80NE032, “the Newcastle Claim”) seeking: (i) a declaration that she was the owner of the copyrights in various typefaces; (ii) injunctions to restrain further infringement of her copyrights; (iii) financial remedies for past acts of infringement; and (iv) an account of sums received by TNB after termination of the 2012 Agreement from sub-licences entered into before termination.

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1. The claims pleaded in Mrs Lish’s Particulars of Claim in the Newcastle Claim were primarily claims for infringement of copyright. Mr Hill was alleged to be a joint tortfeasor with TNB in respect of those claims. The only contractual claim was the claim to an account in respect of ongoing sub-licences entered into by TNB prior to termination of the 2012 Agreement. There was no claim that Mrs Lish had not received all the 60% royalty payments due to her prior to termination of the 2012 Agreement.

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1. On 2 December 2022 the Defendants filed their Defence to the Newcastle Claim. Paragraphs 14-16 of the Defence set out verbatim Mr Hill’s emails dated 5 March 2015 and 16 April 2015 (paragraphs 6 and 7 above), and averred they were “a true and contemporaneous record of” the agreement between Mrs Lish and TNB in March 2015. Paragraph 17 averred that, in accordance with that agreement, TNB had paid Mrs Lish “the new salary” and Mrs Lish had accepted “the enhanced salary”. Mrs Lish’s evidence is that she took this to mean that she “had been paid all the royalties due” to her.

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1. On 4 May 2023 Mrs Lish served a draft Amended Particulars of Claim making various minor amendments to her claims in the Newcastle Claim.

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1. On 5 May 2023 Mrs Lish made an offer under CPR Part 36 to settle the Newcastle Claim (“the Part 36 Offer”). So far as material, this stated:

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“Our client has confidence in her claim, as we have stated throughout. The only benefit realistically to our client in settlement now is to avoid the further costs of progressing to trial, a level of which will always be irrecoverable even when our client wins her case as expected. Further, our client simply wishes to move forward and progress with her own business rather than continue protracted litigation with your clients, as we have said previously. Therefore, we are instructed at this stage to make the following offer on Part 36 terms …

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• Your clients will confirm and acknowledge our client’s ownership of the IP in the relevant typefaces, as particularised in our clients draft amended Particulars of Claim served on 04 May 2023 ….

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• Any relevant sub-licences your clients claim they are still contractually obliged to maintain under the 2012 signed agreement will be disclosed in full to our client. Your clients will pay our client 60% of the licence fee for that licence for the remainder of its term from the date of acceptance of this offer. Any licence that continues on a rolling basis unless terminated will be terminated by your clients at the earliest time that such licence permits.

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• Your clients will cease offering and will not in future offer or purport to grant or renew any licence to use the typefaces or any infringing typefaces.

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• Your clients will pay our client’s costs on Part 36 terms.

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… This offer is generous to your clients as it effectively allows them to retain the revenues they have made from their infringements up to the date of acceptance.

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This offer is intended to be a Claimant’s Part 36 offer in respect of the entirety of our client’s issued claim no. J80NE032, as well as any perceived, but as yet completely unparticularised counterclaim your clients may purport to have….

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If you consider this offer to be defective in any way or non-compliant with CPR Part 36 please inform us by return.”

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1. On 12 May 2023 the Defendants served a draft Amended Defence and Counterclaim containing very substantial proposed amendments. One of the proposed amendments was to aver in new paragraph 18C(c) that “[TNB] ceased paying any royalties associated with the 60% Payment to [Mrs Lish] after December 2015”. Mrs Lish’s evidence is that “until the proposed Amended Defence and Counterclaim was served … on 12 May 2023, I was not aware that I had not been paid the royalties I was owed by [TNB]”, and that “[w]hen that proposed amended pleading was served I realised that [it] was not the case [that I had been paid all the royalties due to me]”. The sums in question have been referred to in these proceedings as “the unpaid royalties”.

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1. On 23 May 2023 Mrs Lish’s solicitors wrote to the Defendants’ solicitors, saying among other things:

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“… we note from your clients proposed amended pleading that there is a clear indication that your corporate client has not paid our client the full extent of the royalties due to her under the distribution agreement, this being 60% of sums received for her works. Please therefore provide a full statement of sums received in respect of the relevant fonts for the full life of the contract by return.”

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1. On 7 June 2023 Mrs Lish’s solicitors repeated this request and threatened to apply for disclosure.

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1. On 7 June 2023 the Defendants’ solicitors replied, saying:

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“There is no allegation in the draft Amended Particulars of Claim that any payment is due to your client relating to the period between September 2012 and 20 September 2022. Therefore no issue arises between the parties in relation to this. …

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If you believe we are wrong, please write again directing us to the relevant paragraph of the Amended Particulars of Claim and providing some sort of reasoned justification for your demands …”

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1. On Friday 9 June 2023 Mrs Lish’s solicitors replied, saying:

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“The request arises specifically from that set out in your clients’ Amended Defence and Counterclaim. These pleadings are not yet accepted into the proceedings, so the current Amended Particulars of Claim would not deal with them but it is apparent from that document there has been an underpayment. This is therefore a live issue, your clients have made it a live issue and we have made a proportionate and reasonable request on behalf of our client to see the relevant accounts and details of sales of the fonts in question. The fact this issue is currently not in the Amended Particulars of Claim is not a legally good reason to attempt to deny this request. …

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If your clients continue to unreasonably refuse to provide the information requested the obvious inference from this will be that there has been an underpayment and the same will be pleaded.”

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1. It is common ground that the statement that “the same will be pleaded” was intended and understood to mean that Mrs Lish would apply to amend (or re-amend) her Particulars of Claim.

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1. On Tuesday 13 June 2023 the Defendants accepted the Part 36 Offer, thus settling the Newcastle Claim. By virtue of the terms of settlement, Mrs Lish subsequently received some information from the Defendants about the sums generated by the typefaces she claims to have designed prior to the termination of the 2012 Agreement. Her current estimate is that she is owed some £300,000 in unpaid royalties, whereas the Defendants say that the amount in issue is no more than £50,000 at most.

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1. On 22 March 2024 Mrs Lish commenced the present claim. In this claim Mrs Lish advances three claims: (i) a claim for unpaid royalties under the 2012 Agreement (“the Unpaid Royalties Claim”); (ii) a claim for infringement of copyright in eight designs of typefaces that were not in issue in the Newcastle Claim (“the Infringements Claim”); and (iii) a claim that the Defendants have failed properly to comply with the settlement agreement (“the Neusa Next Claim”). Mr Hill has again been joined as a Defendant on the basis that he is alleged to be a joint tortfeasor in respect of the Infringements Claim, and also because he was a party to the settlement agreement.

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1. On 30 April 2024 the Defendants applied to strike out the Unpaid Royalties Claim and the Infringements Claim as an abuse of process pursuant to CPR rule 3.4(2)(b) on the grounds that (i) the Unpaid Royalties Claim had been compromised by the settlement agreement and/or (ii) both claims could and should have been raised in the Newcastle Claim. The Defendants also applied for summary judgment dismissing the Neusa Next Claim.

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1. Regrettably, the application was not heard for over a year. In his judgment the judge acceded to the application to strike out the Unpaid Royalties Claim and the Infringements Claim as an abuse of process, although he rejected the argument that the Unpaid Royalties Claim had been compromised by the settlement agreement. He dismissed the summary judgment application. Mrs Lish now appeals against the striking out of the Unpaid Royalties Claim and the Infringements Claim with permission granted by myself. There is no cross-appeal by the Defendants in respect of the Neusa Next Claim.

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Henderson v Henderson abuse of process

1. Abuse of process can take many forms. The form invoked by the Defendants in this case is the one that has been developed from the seed planted by Wigram V-C in Henderson v Henderson (1843) Hare 100. There was little dispute between the parties either before the judge or this Court as to the applicable principles. The principles were recently comprehensively reviewed and summarised by Coulson LJ, with the agreement of Stuart-Smith LJ and myself, in MW High Tech Projects UK Ltd v Outotec (USA) Inc [2024] EWCA Civ 844, [2024] 4 WLR 85 at [31]-[53]. For the purposes of the present appeal, it is sufficient to note the following points.

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1. The leading authority is the decision of the House of Lords in Johnson v Gore Wood & Co [2000] UKHL 65, [2002] 2 AC 1, and in particular the much-cited passage in the speech of Lord Bingham of Cornhill at 31, in which he said:

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“The bringing of a claim or the raising of a defence in later proceedings may, without more, amount to abuse if the court is satisfied (the onus being on the party alleging abuse) that the claim or defence should have been raised in the earlier proceedings if it was to be raised at all. … there will rarely be a finding of abuse unless the later proceeding involves what the court regards as unjust harassment of a party. It is, however, wrong to hold that because a matter could have been raised in earlier proceedings it should have been, so as to render the raising of it in later proceedings necessarily abusive. That is to adopt too dogmatic an approach to what should in my opinion be a broad, merits-based judgment which takes account of the public and private interests involved and also takes account of all the facts of the case, focusing attention on the crucial question whether, in all the circumstances, a party is misusing or abusing the process of the court by seeking to raise before it the issue which could have been raised before.”

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1. The principles articulated in Johnson were summarised by Clarke LJ, with whom Scott Baker LJ agreed, in Dexter v Vlieland-Boddy [2003] EWCA Civ 14 at [49]:

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“i) Where A has brought an action against B, a later action against B or C may be struck out where the second action is an abuse of process.

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ii) A later action against B is much more likely to be held to be an abuse of process than a later action against C.

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iii) The burden of establishing abuse of process is on B or C as the case may be.

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iv) It is wrong to hold that because a matter could have been raised in earlier proceedings it should have been, so as to render the raising of it in later proceedings necessarily abusive.

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v) The question in every case is whether, applying a broad merits based approach, A’s conduct is in all the circumstances an abuse of process.

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vi) The court will rarely find that the later action is an abuse of process unless the later action involves unjust harassment or oppression of B or C.”

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1. This summary was approved by Thomas LJ, with whom Wall and Longmore LJJ agreed, in Aldi Stores Ltd v WDP Group plc [2007] 1 WLR 1260, [2008] 1 WLR 748 at [6].

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1. As Nugee LJ pointed out, with the agreement of Stuart-Smith LJ, in Orji v Nagra [2023] EWCA Civ 1289 at [84]:

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“… what all the cases have in common is that the second claim is an attempt to reopen something that has already been decided. That is where the abuse lies. That does not mean there must have been a trial of the first claim. The principle is capable of applying if the previous proceedings have been settled by agreement. A settlement by the parties is just as much a final resolution of a claim as a judgment by a court, and it can be just as abusive to seek to circumvent it by putting forward a second claim. …”

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1. In Stuart v Goldberg Linde [2008] EWCA Civ 2, [2008] 1 WLR 823 Lloyd LJ, with whom Sedley LJ agreed, said at [59]:

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“ Failure to use reasonable diligence. As for the relevance of a claimant’s failure to use what the court might consider to be reasonable diligence in finding out facts relevant to whether he has a possible claim, it may be that this could possibly be relevant to the enquiry described by Lord Bingham, depending on the circumstances. On the other hand, it does not seem to me that there can be a general principle that a potential claimant is under a duty to exercise reasonable diligence, not yet having brought proceedings asserting a particular claim, to find out the facts relevant to whether he has or may have such a claim. Moreover, I do not see how it can be relevant at all that the claimant may have failed to use due diligence in attending to his own interests at the time of the transaction or the events giving rise to the claims asserted. Unless, on the merits, that is a complete and inevitable defence to the claim, it seems to me to be entirely irrelevant to the enquiry which is necessary under Johnson v Gore Wood... Nothing in Wigram V-C’s observations in Henderson v Henderson … supports that. … If relevant at all, an enquiry as to any suggested lack of diligence on the part of the claimant would have to involve considering the circumstances of the particular claimant, including what knowledge he did have of the facts at any relevant stage, in order to decide whether he knew enough to put him on enquiry so as to try to find out more. In this context, as generally, it is also relevant that the onus is always on the defendant to show that the claimant’s conduct is an abuse of process.”

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The test on appeal

1. As Thomas LJ said in Aldi v WPP at [16]:

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“… there can … only be one correct answer to whether there is or is not an abuse of process. Nonetheless an appellate court will be reluctant to interfere with the decision of the judge in the judgment he reaches on abuse of process by the balance of the factors … it will generally only interfere where the judge has taken into account immaterial factors, omitted to take account of material factors, erred in principle or come to a conclusion that was impermissible or not open to him.”

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1. In Stuart v Goldberg Linde this statement was cited with approval by Sir Anthony Clarke MR at [81], subject only to the qualification that the appellate court should also interfere if the judge was plainly wrong. Sedley LJ agreed at [76].

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The judge’s reasoning

1. So far as the Unpaid Royalties Claim is concerned, the judge accepted Mrs Lish’s contention that this had not been pleaded in the Newcastle Claim and therefore had not been compromised by the settlement agreement (judgment at [76]-[78]). There is no challenge by the Defendants to that conclusion.

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1. The judge said that he did not need to reach a concluded view on whether Mrs Lish ought to have known the Defendants’ position on unpaid royalties based on the pre-action correspondence or the early pleadings in the Newcastle Action for the following reasons:

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“79. … It seems to me unlikely on the face of it that Mrs Lish would not have noticed that her payments, for a period of 7 years, were in rounded numbers. Further, having been caused to wonder in July 2022 whether she was being underpaid (as she admitted) an amount I am now told could be as high as £300,000, I am not convinced that an objective person in Mrs Lish’s position would not have taken further steps to ascertain the true position, particularly as she later commenced the Newcastle Claim against [TNB]. … The Defendants’ counsel urged on me that, having been caused to wonder, Mrs Lish ought to have taken further steps to find out the position of any underpayment. There is force in that submission ….

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1. It does seem to me that it is likely that Mrs Lish was on notice from as early as 2022 that, since 2015, she had not been paid the 60% royalties under the 2012 Agreement. The Defendants' counsel describes as ‘entirely fanciful’ Mrs Lish's position that she was first on notice of the alleged underpayment when she received the draft Amended Defence and Counterclaim. That may put matters too highly, but it does seem to me that all the dots were there, and a reasonable person in Mrs Lish's position would have taken steps to join them.”

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1. The judge said that this did not matter, however, because:

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“81. …. Mrs Lish accepts that she had sufficient information to bring the Unpaid Royalties Claim having received and reviewed the draft Amended Defence and Counterclaim. ... There was a month between service of the proposed Amended Defence and Counterclaim and acceptance of the Part 36 Offer. At the hearing, I asked Mrs Lish’s counsel if it would have been open to her once she had received the proposed Amended Defence and Counterclaim to withdraw the Part 36 Offer, to provide her with sufficient time to regroup, and, if appropriate, replead the Newcastle Claim: he accepted that Mrs Lish could have taken those steps. Alternatively, she ought to have been clear to the Defendants that the Unpaid Royalties Claim was not included in the Part 36 Offer, that is, that she no longer wished to settle the whole dispute to ‘move forward and progress with her own business’. In my judgment, it was not open to Mrs Lish on the basis of Dexter to allow the Newcastle Claim to settle, and then commence further proceedings against the same parties in relation to the same arrangement and the same facts. To do so places the Defendants in a very difficult position. In compromising the Newcastle Claim, the Defendants made certain admissions as to copyright ownership that ran contrary to their pleaded case that Mrs Lish was an employee: they might not have done so had they known they were facing a further claim for unpaid royalties. It is not an answer, as Mrs Lish’s counsel submitted, that the Defendants were facing the Unpaid Royalties Claim as a fresh claim when Mrs Lish was entitled to amend the Newcastle Claim to include it – the Defendants are, in effect, now facing this claim with one hand tied behind their backs given the admissions made to settle the Newcastle Claim. That underlines the abusive nature of this claim. I also do not accept Mrs Lish’s counsel’s submission that the Defendants are not vexed twice because this claim ‘depends on different issues that were not in dispute, or were not central to’ the Newcastle Claim. I disagree – the meaning of the 2012 Agreement and any variation to it were central to the issues in the Newcastle Claim, and, as counsel for the Defendants pointed out, the Unpaid Royalties Claim involves the same parties, the same subject matter, the same agreement, the same issues and the same remedies.

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1. Lord Bingham emphasised in Aldi [sic – this should presumably be a reference to Johnson ] the need for finality in litigation. I am also mindful of the need for efficient use of court resources and the needs of other users. A multiplicity of actions is not in the interests of court users generally (because it occupies additional court days that could be used by other litigants) and, in this case, is certainly not in the interests of the Defendants, who have given detailed evidence of the negative impact on them of these proceedings. In my judgment, the Defendants have established that the Unpaid Royalties Claim is unjustly harassing and oppressive. The Unpaid Royalties Claim is abusive, and should be struck out.”

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1. As for the Infringements Claim, the judge held as follows:

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“84. Mrs Lish accepts that the Infringements Claim was not included in the Newcastle Claim but could have been. She says that, at the time, she took the pragmatic decision not to include these additional typefaces because:

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[(i)-(iii) the additional typefaces were for various reasons of limited commercial significance]

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iv) Her pragmatic decision was based on her understanding that she had been properly paid royalties for these typefaces, such that when she discovered that she had not, the basis for her pragmatic decision fell away, and it was not appropriate to claim in respect of those typefaces as well.

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1. I have found above that it would be an abuse of the court’s process to allow Mrs Lish to continue with a claim for unpaid royalties in relation to typefaces which were pleaded in the Newcastle Claim. Typefaces which Mrs Lish knew she could have included in those proceedings, but decided not to (pragmatically or otherwise) can be in no better position. The Infringements Claim should therefore also be struck out.”

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Grounds of appeal

1. Mrs Lish appeals on four grounds. Ground 1 is that, in his reasoning at [81]-[82], the judge made four errors in his analysis with respect to the Unpaid Royalties Claim. Ground 2 is that the judge made five findings at [79]-[80] which were not properly open to him. Ground 3 is that the judge was wrong to find that the Unpaid Royalties Claim was abusive. Ground 4 is that the judge was wrong to find that the Infringements Claim was abusive.

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Respondents’ notice

1. The Defendants contend by way of a respondents’ notice that the judge’s decision in relation to the Unpaid Royalties Claim should, if necessary, be upheld for the reasons he gave at [79]-[80] in the alternative to the reasons he gave at [81]-[82].

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Analysis: the Unpaid Royalties Claim

1. So far as the Unpaid Royalties Claim is concerned, the key ground of appeal is ground 1. Mrs Lish contends that the judge made four distinct errors in his analysis. I find it convenient to consider these in a slightly different order to the order in which they were pleaded and argued.

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1. Ground 1(b) is that the judge was wrong to hold that the Unpaid Royalties Claim “involves … the same issues and the same remedies” as the Newcastle Claim. I agree with this. Upon analysis, neither the issues nor the remedies are the same.

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1. As explained above, the Newcastle Claim was primarily a claim for copyright infringement. The principal issues between the parties concerned Mrs Lish’s claim to ownership of the relevant copyrights: was she an employee of TNB, and if so did the 2012 Agreement have the effect that she nevertheless owned the copyrights? The remedies claimed were the normal remedies for copyright infringement: an injunction to restrain further infringements and either an inquiry as damages or an account of profits in respect of infringing acts after termination of the 2012 Agreement. The only contractual claim was in respect of post-termination revenues received by TNB from pre-termination sub-licences. As the Defendants’ solicitors correctly pointed out in their letter dated 7 June 2023 (paragraph 23 above), there was no claim for unpaid royalties prior to termination of the 2012 Agreement.

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1. By contrast, the Unpaid Royalties Claim is a purely contractual claim for unpaid royalties prior to termination of the 2012 Agreement. This is a different cause of action in respect of a different time period to the causes of action asserted in the Newcastle Claim. The principal issues are purely contractual ones: did Mrs Lish supply finished Typefaces within the meaning of the 2012 Agreement, what was agreed between Mrs Lish and TNB in March 2015 and did TNB pay Mrs Lish all the sums due to her under the 2012 Agreement as varied by the 2015 Variation? The remedy claimed is an account of the unpaid royalties, which is a different remedy to any remedy claimed in the Newcastle Claim.

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1. It is precisely for these reasons that the judge was correct to hold that the Unpaid Royalties Claim had not been compromised by the settlement agreement.

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1. Counsel for the Defendants, who argued the Defendants’ case with tenacity tempered by realism, accepted that the issues and remedies were not identical, but submitted that they were similar and that this was sufficient. I do not accept this submission. The judge did not say that the issues and remedies were similar, he said that they were the same. When considering whether a second claim is an abuse of process, this difference is significant. Furthermore, I do not agree that the issues and remedies are even similar. In my view they are entirely distinct, although arising out of much of the same factual background.

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1. Ground 1(a) is that the judge was wrong to hold that the Defendants’ acceptance, as part of the settlement agreement, that Mrs Lish owned the copyrights in the typefaces in issue in the Newcastle Claim was an admission which they might have not made had they known that they were facing a claim for unpaid royalties and which adversely affected their ability to defend the Unpaid Royalties Claim. As the judge graphically put it, the Defendants were “facing this claim with one hand tied behind their backs”. Again, I agree that the judge was in error.

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1. First, the Defendants did know that Mrs Lish was claiming unpaid royalties by virtue of her solicitors’ letters dated 23 May, 7 June and 9 June 2023 (paragraphs 21, 22 and 24 above). Secondly, the Defendants made no admission of any of the facts relied upon by Mrs Lish when they accepted the Part 36 Offer, they merely agreed to acknowledge her ownership of the copyrights asserted in the Newcastle Claim. Thirdly, as I have explained, ownership of those copyrights is simply irrelevant to the Unpaid Royalties Claim, which is a purely contractual claim based on the 2012 Agreement and the 2015 Variation.

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1. Counsel for the Defendants submitted that, even if the Defendants were not prejudiced in their defence of the Unpaid Royalties Claim, their ability to negotiate a settlement of that claim had been prejudiced because they had given up one of their negotiating cards when they accepted the Part 36 Offer. Again, this was not the judge’s reasoning. Furthermore, I do not see how the Defendants can have been materially prejudiced in this respect given the absence of any connection between the issues as to ownership of copyright and the issues raised by the Unpaid Royalties Claim.

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1. Ground 1(d) is that the judge was wrong to place reliance on the fact that Mrs Lish could have withdrawn the Part 36 Offer “to provide her with sufficient time to regroup and, if appropriate, replead the Newcastle Claim”. Again, I agree with this. As Lord Bingham emphasised in Johnson, it is not sufficient that the new claim could have been brought before: there is only an abuse if it should have been. I see no reason why Mrs Lish should have withdrawn the Part 36 Offer and amended her Particulars of Claim to introduce the Unpaid Royalties Claim. As the judge correctly held, the Part 36 Offer was an offer to settle the claims pleaded in the Newcastle Claim. It was not an offer to settle a claim which the Defendants’ solicitors correctly pointed out had not been pleaded in the draft Amended Particulars of Claim served before the Part 36 Offer and which subsequently arose out of the draft Amended Defence and Counterclaim. Mrs Lish’s willingness to settle her pleaded claims in the Newcastle Claim on the terms set out in the Part 36 Offer was unaffected by that subsequent development.

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1. Ground 1(c) is that the judge was wrong to hold, in the alternative, that Mrs Lish “ought to have been clear to the Defendants that the Unpaid Royalties Claim was not included in the Part 36 Offer”. Again, I agree with this. The Defendants must have appreciated that it was not included. As I have already noted, the Part 36 Offer was only an offer to settle the claims pleaded by Mrs Lish in the Newcastle Claim. The Unpaid Royalties Claim only arose after the making of the Part 36 Offer as a result of the service of the draft Amended Defence and Counterclaim. Furthermore, as I have again already noted, the Defendants’ solicitors themselves correctly pointed out that it was not a pleaded claim. If the Defendants wanted the Part 36 Offer to include the Unpaid Royalties Claim, the onus lay upon them to raise the matter before accepting it. They did not do so. Thus they accepted Mrs Lish’s Part 36 Offer to settle the claims she had pleaded in the Newcastle Claim knowing that Mrs Lish had recently asserted an additional, as yet unpleaded, claim.

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1. For the reasons given above, I conclude that the judge’s reasoning at [81]-[82] is vitiated by material errors of analysis.

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1. Ground 2 and the Respondents’ notice are two sides of the same coin. The Defendants rely upon the judge’s findings at [79]-[80] as providing an alternative ground for his decision that the Unpaid Royalties Claim was an abuse of process. Mrs Lish contends by ground 2 that five findings were not properly open to the judge. She also contends in answer to the Respondents’ notice that those findings do not in any event justify the conclusion that the Unpaid Royalties Claim is an abuse of process.

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1. The first finding challenged by Mrs Lish is that it was “unlikely … that Mrs Lish would not have noticed that her payments, for a period of seven years, were in rounded numbers”. There is no dispute that Mrs Lish knew that the sums she received were in rounded numbers. The issue is as to the significance of this fact. The judge treated it as something that should have put her on enquiry as to whether she was being underpaid. Mrs Lish argues that this does not follow, for two reasons. First, the Defendants admitted in paragraph 11(b) of their Defence in the Newcastle Claim that TNB had always rounded up the sums it paid her. Secondly, there is in any event no reason why mere rounding should have alerted Mrs Lish to underpayment of her royalties. Counsel for the Defendant had no convincing answer to these arguments, and I accept them.

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1. Secondly, Mrs Lish complains that the judge’s statement that she “ha[d] been caused to wonder whether she was being underpaid (as she admitted) an amount which I am now told could be as high as £300,000” suggests that Mrs Lish should have suspected that she was being very substantially underpaid. As Mrs Lish points out, however, her current estimate is based on information that she received from the Defendants after the settlement of the Newcastle Claim. There is no basis for suggesting that she had any reason to suspect an underpayment of that size in July 2022. Counsel for the Defendants submitted that the judge cannot have meant to imply that Mrs Lish knew the size of the Unpaid Royalties Claim in July 2022, but it is difficult to avoid the impression that the judge was influenced by hindsight knowledge that was not available to Mrs Lish until after the acceptance of the Part 36 Offer.

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1. Thirdly, Mrs Lish submits that the judge’s statements that “I am not convinced that an objective person in Mrs Lish’s position would not have taken further steps to ascertain the true position” and that there was force in the submission that “Mrs Lish ought to have taken further steps to find out the position” amount to a finding that she failed to take further steps to ascertain the true position which was not open to the judge, because in fact she did take further steps to ascertain the true position, but was stone-walled by the Defendants. As soon as the Defendants served the Amended Defence and Counterclaim, Mrs Lish’s solicitors sent their letters dated 23 May and 7 June 2023 requesting further information (paragraphs 21 and 22 above). The Defendants’ response was to refuse to supply the information on the ground that the Unpaid Royalties Claim was not pleaded (paragraph 23 above). Counsel for the Defendants had no real answer to this submission and I accept it.

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1. Fourthly, Mrs Lish contends that the judge’s finding that it was “likely that Mrs Lish was on notice from as early as 2022 that, since 2015, she had not been paid” the 60% royalty was not properly open to him because it is contrary to her evidence that she did not believe that she had been underpaid until receipt of the draft Amended Defence and Counterclaim, evidence which has not been tested in cross-examination.

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1. As counsel for the Defendants submitted, the judge’s finding was an objective one, not a finding about Mrs Lish’s subjective state of mind. Even so, the question remains whether the finding was properly open to the judge on the evidence.

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1. Counsel for the Defendants relied upon the letters dated 8, 15 and 29 July 2022 as supporting this finding (paragraphs 11-13 above), but the judge did not base his finding upon the terms of those letters, but upon the payments in rounded numbers, Mrs Lish’s admission that she had been caused to wonder about underpayment and her failure to take further steps to ascertain the position. For these reasons given in paragraphs 57-59 above, those matters do not justify the conclusion that Mrs Lish had been put on notice that she had not been paid the 60% royalties she was due.

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1. Furthermore, even if the question is an objective one, it is necessary to take into account Mrs Lish’s evidence that she did not believe that she had been underpaid until receipt of the draft Amended Defence and Counterclaim. The judge rightly did not hold that this evidence was incredible. Although the letters dated 8, 15 and 29 July 2022 can be interpreted as supporting the Defendants’ position, they are not unambiguous when regard is had to the contractual claim that Mrs Lish subsequently advanced in the Newcastle Claim. Furthermore, Mrs Lish’s evidence as to her state of mind receives some support from the original Defence, and in particular the Defendants’ averment that TNB had paid Mrs Lish in accordance with the agreement evidenced by Mr Hill’s emails dated 5 March and 15 April 2015 (paragraphs 6 and 7 above). It is also supported by her reaction to the service of the draft Amended Defence and Counterclaim: she instantly raised what became the Unpaid Royalties Claim in correspondence.

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1. Finally, Mrs Lish contends that, for the reasons canvassed above, it was not properly open to the judge to find that “all the dots were there, and a reasonable person in Mrs Lish’s position would have taken steps to join them”. I agree with this. I would add that the judge seems to have regarded the enquiry as restricted to the period down to the issue of the claim form and service of the Particulars of Claim in the Newcastle Claim, but there is no basis for limiting it in that way. Since the Defendants’ argument that the Unpaid Royalties Claim is an abuse of process is founded upon the settlement agreement, it is necessary to take into account both parties’ conduct and state of knowledge down to the date of acceptance of the Part 36 Offer.

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1. It follows that, if the Unpaid Royalties Claim is not an abuse of process for the reasons given by the judge at [81]-[82], the judge’s conclusion cannot be supported by his findings at [79]-[80] because those findings were not properly open to him.

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1. Ground 3 is that the judge was wrong to conclude that the Unpaid Royalties Claim is an abuse of process. In oral argument counsel for Mrs Lish’s primary submission under this head was that, if this Court concluded that the judge’s assessment at [81]-[82] was vitiated by one or more of the errors relied upon in ground 1, this Court should make its own assessment and should conclude that the Unpaid Royalties Claim is not an abuse of process. Since I have concluded that the judge’s assessment at [81]-[82] was vitiated by a number of errors, it is necessary to re-consider the issue.

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1. In my judgment the Unpaid Royalties Claim is not an abuse of process. It was not a pleaded claim in the Newcastle Claim. It is a distinct claim involving different issues and different remedies. The Defendants settled the Newcastle Claim knowing that Mrs Lish had recently asserted this claim and that it was not pleaded in the Newcastle Claim. Thus Mrs Lish’s pursuit of the Unpaid Royalties Claim does not undermine the finality of the settlement agreement. Nor do the Defendants’ private interests require protection from the Unpaid Royalties Claim. There is nothing which amounts to unjust harassment or oppression of the Defendants in Mrs Lish pursuing this claim. On the contrary, striking it out would prevent Mrs Lish from pursuing a claim which has neither been adjudicated nor settled, and which is not suggested not to have a real prospect of success. That would be a denial of justice.

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Analysis: the Infringements Claim

1. Turning to the Infringements Claim, ground 4 is that the judge was also wrong to conclude that this is an abuse of process. Mrs Lish points out that the judge held that this claim “can be in no better position” than the Unpaid Royalties Claim. She argues that, if the judge reached the wrong conclusion in relation to the Unpaid Royalties Claim, then that undermines his conclusion in relation to the Infringements Claim.

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1. I do not accept this argument. While I have concluded that the judge’s assessment of the Unpaid Royalties Claim was vitiated by errors of analysis, his reasoning does apply to the Infringements Claim. The Infringements Claim involves the same issues and the same remedies as the copyright claims pleaded in the Newcastle Claim. Mrs Lish admits that she was aware of the additional claims prior to the settlement of the Newcastle Claim, but decided not to include them for what she says were pragmatic reasons. She did not alert the Defendants to the additional claims prior to settlement of the Newcastle Claim. When the Defendants agreed to accept the Part 36 Offer they had no reason to suppose that they were not settling all of Mrs Lish’s copyright claims and every reason to think that they were doing so. If Mrs Lish wished to preserve additional claims for copyright infringement which she had not yet raised, the onus lay on her to make that clear to the Defendants, but she did not. By acknowledging her ownership of copyright in the pleaded typefaces, the Defendants are handicapped in defending her claim to copyright in the additional typefaces at least to the extent that they have given up one of their negotiating cards. If Mrs Lish wished to pursue these additional claims, she should have raised them before settling the Newcastle Claim. Raising and pursuing them for the first time after settlement of the Newcastle Claim undermines the finality of the settlement agreement and amounts to unjust harassment of the Defendants.

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1. Accordingly, in my judgment, the judge was right to conclude that the Infringements Claim is an abuse of process.

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Conclusion

1. I would allow the appeal in relation to the Unpaid Royalties Claim, but dismiss it in relation to the Infringements Claim.

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Lord Justice Coulson:

1. I agree.

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Lord Justice Moylan:

1. I also agree.

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End of document

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