High Court strikes out £40 million fraud claim against RSM administrators

The High Court has struck out a more than £40 million fraud claim brought by the former owner of Killean Estates Limited against RSM and three former administrators, finding that the claim was incoherent, abusive, procedurally defective and totally without merit.

Master Kaye, sitting as a deputy High Court judge, dismissed Anthony Gladwin’s claim against RSM and former joint administrators Paul Dounis, Gareth Harris and Steven Ross, and imposed a three-year extended civil restraint order preventing him from issuing further claims or applications concerning the same subject matter without permission from a High Court judge.

Killean Estates was incorporated in Scotland in 2015 to acquire, develop and operate the Killean Estate. Gladwin was the company’s sole director and shareholder. The estate included Killean House, 24 self-catering holiday cottages, two farms, a shop and a hotel. Gladwin and his family lived at Killean House until they were evicted in 2023.

The company acquired the estate in 2016 with financing from Lendy Ltd and later Saving Stream Holding Limited (SSSHL). The original borrowing was about £4.6 million gross and was later increased. The loan agreements contained default interest provisions. After the company failed to repay by the relevant repayment dates, Lendy and SSSHL issued a formal demand on 29 June 2018 for immediate repayment of the loans and interest, stating that the loans were in default.

Dounis and Ross, then partners at RSM, were appointed joint administrators by SSSHL on 17 July 2018. Ross was later replaced by Harris in 2020. During the administration, the company’s heritable property was sold for £4.39 million. By that point, the secured debt owed to Lendy and SSSHL had grown to £8.772 million. The secured creditors received net proceeds of £3.176 million, leaving about £5.5 million outstanding, in addition to unsecured creditor claims of about £1.3 million.

Gladwin alleged that the loans and administrators’ appointment were invalid, that the estate sales were void or fraudulent, and that the administration and dissolution of the company formed part of a wider conspiracy involving RSM, Lendy, SSSHL, the administrators and the eventual purchaser of parts of the estate. He sought to unwind the administration and property transfers, restore the company, and recover damages and compensation exceeding £40 million.

This 2025 claim was not Gladwin’s first attempt to advance these complaints. He had issued a similar claim in Scotland in 2023 and then a claim in England later that year. ICC Judge Barber struck out the 2023 English claim and identified fundamental defects, including that RSM was not a proper defendant, that Gladwin had not obtained permission to sue the discharged administrators, and that the pleaded claims were unsupported. The new claim repeated substantially the same allegations, with added references to the Fraud Act 2006.

The Court held that reliance on the Fraud Act did not assist Gladwin. The Fraud Act creates criminal offences and does not provide a standalone civil cause of action. A claimant alleging civil fraud must identify a recognised cause of action, plead the necessary elements and provide full particulars of the primary facts relied on. Gladwin did not do so. The Court found that his pleading consisted largely of speculation, supposition, misunderstanding and unsupported assertions, not facts capable of supporting a civil fraud claim.

Master Kaye also held that there was no legal basis for any claim against RSM. RSM had never been the administrator of the company, Lendy or SSSHL; the officeholders were individual insolvency practitioners. Gladwin’s change in language from alleging that the administrators acted under RSM’s “control” to alleging that they acted under its “banner” did not create a juridical nexus between RSM and the claim. That defect alone justified striking out the claim against RSM as totally without merit.

The claim against the former administrators was also defective because Gladwin had not obtained permission under paragraph 75(6) of Schedule B1 to the Insolvency Act 1986 to bring proceedings against discharged administrators. The Court found that any permission application would have failed because Gladwin had not identified a reasonably meritorious claim or any benefit to the insolvent estate. The secured creditor shortfall exceeded £5 million and unsecured claims were about £1.38 million, leaving no realistic prospect of a return to Gladwin as shareholder.

The judgment also rejected Gladwin’s attempt to challenge the administrators’ appointment by reference to alleged defects in the loan and security documents. The Court noted that any dispute about the loans or the floating charge would have been a matter between the company and Lendy or SSSHL, governed by Scots law, and should have been raised at the time. Gladwin had received Scottish legal advice in 2023 that undermined, rather than supported, his position on the alleged effect of an earlier security discharge.

The Court found that the administration itself had been extended by four Scottish High Court orders between 2019 and 2022. Gladwin alleged, without evidence, that the first extension order was forged and that documents had been backdated. Master Kaye described those allegations as extremely serious and unsupported by even “a shred of evidence.

Gladwin also alleged that the estate had been sold at an undervalue, relying on an asserted 2018 valuation of £8.5 million. The Court found that the administrators had obtained professional valuation and marketing advice, that initial marketing by Bidwells was followed by marketing by Strutt & Parker, and that Gladwin’s continued refusal to provide vacant possession affected the value and sale process. The balance of the estate was eventually sold to Ernest Cox Limited for £3.35 million in December 2021, while Gladwin and his family remained in possession.

The Court held that the 2025 claim was an abuse of process. It was, in substance, a second or third attempt to advance the same allegations that had already been raised in Scotland and in the 2023 English proceedings. It also amounted to a collateral attack on ICC Judge Barber’s earlier judgment and Henderson v Henderson abuse, since any matters not already raised could and should have been raised in the earlier proceedings.

The claim was also struck out for procedural non-compliance. The Court identified multiple defects, including failure to provide a compliant address for service, defective service, failure to obtain permission to sue the administrators, failure to plead a coherent claim, failure to comply with pleading requirements for fraud, and failure to pay the adverse costs order made in the 2023 claim. Taken together, those defects reinforced the conclusion that the claim should be struck out under CPR 3.4(2)(a), (b) and (c).

Master Kaye certified the claim as totally without merit and granted an extended civil restraint order for the maximum period of three years. The Court found that Gladwin had persistently issued unmeritorious claims and applications across jurisdictions, had made serious unsupported allegations of fraud and forged court documents, and remained highly likely to issue further claims or applications if not restrained.

Read the decision here.

Professionals involved:

• Rory Brown KC of South Square (instructed by RSM and Taylor Wessing) for RSM, Paul Dounis, Gareth Harris and Steven Ross