The court overturned an order compelling Stevens to pay the liquidators of Hotel Portfolio II £160 million — a sum equal to Ruhan's profits plus interest. It ruled that the company could not, by law, claim both compensation and the profits made by illegal means.

"Standing back from the detail, there was a single and uninterrupted course of conduct which, taken as a whole, caused Hotel Portfolio II no loss," Justice Guy Newey said. "That being so, it strikes me as just that Mr. Stevens' liability should be limited to his personal profit. It appears to me that, for the reasons I have given, Hotel Portfolio II is not entitled to compensation of any kind."

The High Court ordered Stevens in 2022 to pay approximately £160 million for assisting Ruhan in arranging the sale of the properties without disclosing that the former director had a stake in the buyer. The order included around £100 million in compensation and £60 million in interest. 

Ruhan was ordered to pay the same amount, not as compensation but as an account of the profit he made selling the hotels to his own company, Cambulo-Comércio Internacional e Serviços Sociedade Unipessoal Madeira Lda. 

The hotels in West London are the Kensington Park, the Kensington Palace and the Lancaster Gate. They had once been owned by Gerald Smith, who was convicted in 2006 of stealing £34 million from an information technology company he once ran, according to court records.

The scheme did not cause the Hotel Portfolio II any loss, according to the judgment. But the law states that Ruhan, as a director who owed a fiduciary duty to the company, owed his profits to the company for the breach, it added.

Hotel Portfolio II liquidators filed their claims in 2018. The company went into creditors' voluntary liquidation in 2008.

Justice Newey said that, while the company was owed Ruhan's profits, it could not also claim compensation from Stevens, overturning the High Court order as a result.

"Hotel Portfolio II has not established any liability to pay equitable compensation as against Mr. Stevens," Justice Newey said.

The decision comes after the Court of Appeal refused in May to make the challenge by Stevens conditional on him paying £2.2 million toward Hotel Portfolio II's legal costs. 

Stevens told Law360 that he was "extremely pleased" with the judgment. 

"I pay tribute to my extremely talented barrister team led by Tony de Garr Robinson KC and ably supported by Sebastian Kokelaar and Stephen Ryan," he said.

Lawyers for Hotel Portfolio II did not immediately respond to a request for comment.

Stevens is represented by Anthony de Garr Robinson KC of One Essex Court and Sebastian Kokelaar and Stephen Ryan of Three Stone, instructed by Richard Slade and Co. Ltd.

The Hotel Portfolio II and its liquidators are represented by James Pickering KC and Samuel Hodge of Enterprise Chambers, instructed by Spring Law Ltd.

The case is Hotel Portfolio II UK Ltd. (in liquidation) and another v. Andrew Joseph Ruhan and another, case number CA-2022-001487, in the Court of Appeal of England and Wales.

Additional reporting by Sophia Dourou and Silvia Martelli. Editing by Joe Millis.

Update: This story has been updated with a comment from Anthony Stevens.