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Cite as: [2017] EWHC 1198 (Comm)

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Neutral Citation Number: [2017] EWHC 1198 (Comm)
Claim No CL 2016 000524

IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT

Claim No CL 2016 000524
Royal Courts of Justice
Strand, London, WC2A 2LL
23rd May 2017

B e f o r e :

Sir Jeremy Cooke
Sitting as a Judge of the High Court

____________________

(1) AHMED ADEL ABDALLAH AHMED
(2) CBSC EVENTS & EXHIBITION AND CONFERENCE ORGANIZERS (formerly known as CLASSIC BUSINESSMEN SERVICE CENTRE) Claimants
and
SHEIKH HAMAD ISA ALI KHALIFA Defendant

____________________

Stephen Nathan QC and Duncan Macpherson (instructed by) Zaiwalla & Co) for the Claimants
Andrew Lenon QC (instructed by Simmons Gleek) for the Defendant

Hearing dates: 16th and 17th May 2017

____________________

HTML VERSION OF JUDGMENT APPROVED
____________________

Crown Copyright ©

    Sir Jeremy Cooke:

    Introduction

  1. This is an application to stay the proceedings on the ground of forum non conveniens on the basis that the courts of Bahrain would be a distinctly more appropriate venue for the trial of the claim than the courts of England. It is said by the Defendant that the dispute has no substantial connection with England and that a stay here and the pursuit of the claim in Bahrain would best serve the ends of justice. The Claimants say that there is sufficient connection with this country, that Bahrain is not a clearly more appropriate forum, applying the criteria set out in the authorities and that there is a risk that justice will not be done in Bahrain because of the identity of the Defendant and the perceived risk of injustice from a lack of independence of the courts there.
  2. The Parties

  3. The First Claimant is an Egyptian national, who describes himself as an international businessman, who does business mostly in Dubai and London. He lives in a serviced apartment in Dubai, although the Particulars of Claim allege that he resides in both London and Dubai. A late revelation was given on the first day of the hearing that he had a flat in London, for which he signed a tenancy agreement in July 2016. He is also the holder of a Bahraini ID card and residence permit and is or was until recently the registered representative and director of the Second Claimant, a Dubai based company established by him, which "specialises in the provision of business related services and operates mostly as a provider of professional broking services to wealthy and/or notable individuals" and which had a representative office in Bahrain. That office in Bahrain appears to be a residential flat but is said to have closed last month, though its registration was renewed in April 2016. The First Claimant has, since the events in issue, created two companies which operate in London, including one with the same or a similar name to his company in Bahrain. He had refused to disclose his passport which would have revealed the time he spends in the UK, until, on the first afternoon of the trial, he had a change of heart. It then emerged that since February 2016 he had paid 29 trips to London. He had made 15 trips to Bahrain in the same period, some in connection with the closure of the office there. It now appears that he has a greater connection with this country than emerged from his evidence filed in opposition to the Defendant's application, albeit that this connection appears to postdate the events in question and may not be unconnected with seeking to show a link with this country for the purposes of this application. Until the new revelations I was unpersuaded that he had any substantial connection with this country, whereas he plainly had a real connection with Bahrain at the time of the events in question, which he sought to downplay. He has deposed in a witness statement that his company in Dubai never carried out any business transactions in Bahrain, that it had no trading licence and that it acted only in a marketing capacity for the Dubai entity.
  4. The Defendant, who disclosed his passport, is a Bahraini national, domiciled and resident in Bahrain, who, on the evidence before the court, spends approximately 2-3 months of the year in this country, staying in London hotels. For a period of about 4 years, however, he received treatment in a rehabilitation clinic here between 2004 and 2008. His family have owned property here for many years and, until March 2016, he owned a flat in London which he rarely used, since he preferred hotels and the service provided there. He sold the flat because he had no future use for it. The Defendant is a member of the Bahraini Royal family. His grandfather was one of four brothers to the then King of Bahrain who died in 1961 and whose grandson is the current King. The Defendant is therefore a distant cousin of the current King. His father had, prior to his death in 2015, and his uncle still has extensive political connections in Bahrain.
  5. Both the Claimant and Defendant speak both Arabic and English, though it is said that, for the purposes of giving evidence in this country, the Defendant would prefer to have an interpreter.
  6. The Principles set out in the Authorities

  7. The applicable principles when a stay is sought on the ground of forum non conveniens were not seriously in issue, save for one point, namely the nature of what had to be shown to the English Court to persuade it that justice might not be done in the foreign rival jurisdiction. The seminal authority is still Spiliada Maritime Corp v Cansulex Ltd [1987] AC 460.
  8. 5.1 As the Defendant was served on 7 October 2016 in a taxi outside a London hotel, within the jurisdiction, on one of his visits here, and service was therefore as of right, the burden is on him to establish that Bahrain is clearly the more appropriate forum for the trial of the action and the determination of the dispute, the nature of which appears hereafter.

    5.2 If the court is satisfied by the Defendant that there is another available forum which is clearly a more appropriate forum for the trial of the action, the burden shifts to the Claimant to show that there are special circumstances by reason of which justice requires that the trial should nevertheless take place in England.

    5.3 If the court concludes that there is some other available forum which prima facie is clearly more appropriate,it will ordinarily grant a stay unless there are circumstances by reason of which justice requires that a stay should not be granted, taking into account all the circumstances of the case and the ends of justice.

    5.4 In considering which forum of those put forward is the most appropriate forum, the court will consider the extent of the connecting factors of the dispute with the rival jurisdictions, by reference to the identity of the parties, to their locations, and to the whereabouts of documents and witnesses, taking into account the nature of the dispute and the issues which will arise and where they will be most suitably tried in the interests of both parties and the ends of justice. The court should look for the forum with which the dispute has the most real and substantial connection, including factors affecting convenience or expense, such as availability of witnesses, and other factors which include the law governing the transaction.

    5.5 In making its decision, it is not normally appropriate for the court to compare the quality of justice obtainable in a foreign forum by reference to the different procedures which operate there. The procedures which are adopted in civil law jurisdictions are necessarily different from those which are utilised in common law jurisdictions, but this is not a basis, per se, for concluding that a case is better heard under one system rather than the other.

  9. The question arose as to the test to be applied by the court in determining whether there was a real risk that the Claimant might not get a fair trial in Bahrain by reason of the fact that the Defendant is a member of the Royal family. The Defendant's case was that, if any criticism was to be made as to ineffectiveness, let alone partiality, of the judiciary of a foreign state, it had to be supported by much more than the mere generalised assertion and subjective fear of an individual party that justice would not be done there. Properly attested examples of injustice should be given which can then form a suitable evidential foundation for any such conclusion.
  10. The Defendant submitted that comity required the court to be extremely cautious before deciding that there was a risk that justice would not be done in a foreign country by the foreign court, and that is why cogent evidence was required to show it, relying on dicta in Altimo Holdings v Kyrgyz Mobil Tel Ltd (PC) [ 2012] 1 WLR 1804, to that effect. It was said that it was not therefore surprising that it was exceptional for an English court to decline to stay proceedings on the basis of a risk that a claimant will not receive a fair trial in a foreign jurisdiction, an example of which is Deripaska v Cherney [2009] EWCA 849 where Mr Justice Christopher Clarke (as he then was) said at paragraph 31:
  11. "I am persuaded that the risks inherent in a trial in Russia (assassination, arrest on trumped up charges and lack of a fair trial) are sufficient to make England the forum in which the case can most suitably be tried in the interests of both parties and the ends of justice and, accordingly, the proper place for the determination of this claim."

  12. The question which had to be addressed by cogent evidence was the risk that justice would not be done in the foreign jurisdiction. Although a party did not have to establish on the balance of probabilities that the risk would necessarily eventuate, it had to be shown that there was a real risk that justice would not be obtained in the foreign court by reason of incompetence or lack of independence or corruption.
  13. The Claimants by their Counsel, Mr Stephen Nathan QC submitted that a perception of a risk of partiality was enough. If an objective observer would conclude that, because of the lack of security of tenure of judges in Bahrain who were dependent on the Executive (meaning the King) for continuing engagement, a judge might consciously or sub-consciously allow his judgment to be clouded by what could be seen as favourable to the Rule or his interests, that was enough. The Defendant accepted that such a perception on the part of an objective observer might well amount to the same thing as a real risk, but the question was whether the perception was objective and justified.
  14. The Nature of the Dispute

  15. The Claimants seek payment of a sum of US$42.5 million (less expenses of performance) which is allegedly owed pursuant to an oral agreement made between December 2015 and January 2016. The Claimant's case is that, in the course of two face to face discussions in Bahrain and subsequent telephone conversations with the First Claimant, concluding with a telephone conversation on 7 January 2016 when the Defendant was in London, the Second Claimant was appointed by the Defendant as his exclusive agent to arrange for him to meet with various Bollywood film stars, for 15-25 minutes for the sum of $1.5m per meeting, with a bonus of $500,000 for every third meeting. It is alleged that the Defendant gave the First Claimant, acting on behalf of the Second Claimant, a list of 26 film stars he would like to meet. On 7 January, the Defendant summarised the terms which he proposed and the offer was accepted. It is thus said that the agreement was concluded in London.
  16. After 5 meetings with 4 film stars arranged by the Claimants, which took place in Mumbai and Dubai, and payment of some $3.0m-$3.4m, it is alleged that the Defendant breached the agreement by refusing to pay the sums agreed for the meetings arranged, found excuses not to meet with two further stars when arrangements had been made, found another person to introduce him to thirteen Bollywood film stars including in London and did not go through with the exclusive arrangement with the Second Claimant, thus depriving it of the money it would have made in arranging meetings with the other twenty-two stars on the list. There is a further claim that the Defendant orally agreed to pay for the Second Claimant to be sponsor of a film festival in Dubai and that he failed to pay the agreed price of US$500,000.
  17. The Defendant's case is that he agreed that the First Claimant should arrange a meeting or meetings between him and Bollywood stars but that there was no agreement as to the fees payable. In December 2015 he met the First Claimant at the Defendant's home in Bahrain, following an introduction effected by his uncle, Sheikh Abdulrahman Bin Mubarak, who also lives in Bahrain, but has connections with this country. Sheikh Abdulrahman was aware of the Defendant's keen interest in Bollywood cinema. The First Claimant had told Sheikh Abdulrahman that he had contacts with Bollywood stars and so discussions took place regarding the possibility of the First Claimant introducing the Defendant to some of them, and in particular one star called Shahrukh Khan. The discussions were conducted in Arabic. No list of stars was produced and none has been exhibited in the proceedings.
  18. Further discussions took place by telephone in late December 2015 or early January 2016 when the Defendant was visiting London. It is not clear where the Claimant was at the time of these conversations (except that he was not in England). The content of these discussions is disputed. The Defendant says that, although it was understood that the First Claimant would be remunerated for his services, there was no agreement on any specific sums and no agreement on exclusivity and the First Claimant declined to disclose how much it cost him to arrange the meetings.
  19. Following the discussions, formal instruments were entered into by the Defendant in Bahrain at the First Claimant's request notarised by a Notary Public in Bahrain. These instruments in Arabic and English are quoted and relied on in the Particulars of Claim. They were intended to give the First Claimant credibility in approaching Film Stars or their agents. The instruments authorised the First Claimant to represent the Defendant in arranging and negotiating meetings with Bollywood stars. A meeting with Shahrukh Khan was arranged and four other meetings with three other stars between January 16 and March 2016 in India and Dubai for which the First Claimant was paid (according to the Defendant) in excess of $3.4m. No invoices were ever issued by the Claimants nor any record of expenditure produced. No further sum is said to be payable and the Defendant says that he did not agree to pay for any further meetings nor agree in March 2016 to pay anything in respect of the Dubai film festival, as alleged by the Claimants. By April 2016 as the First Claimant was making demands for very large sums of money and seeking to arrange further meetings, which the Defendant did not want, he terminated the authority he had given to the First Claimant to seek to arrange any more meetings, as he was entitled to do. On 24 April 2016 further instruments were issued before the Notary Public in Bahrain cancelling the First Claimant's authority to represent the Defendant.
  20. The Connecting Factors

  21. Apart from service of proceedings in this jurisdiction and the telephone conversations which the Defendant had with the Claimant whilst in the country, this dispute centres on the middle-east and India. Both the First Claimant and the Defendant now come to this country with some frequency and it is their evidence which is plainly critical in determining what arrangements were made between the parties in December 2015-April 2016. They could both equally give evidence in Bahrain, subject to the First Claimant's expressed fears of intimidation.
  22. The oral contract or contracts alleged represent the key area of dispute and these turn on what was said by the First Claimant and the Defendant. The Defendant in his first witness statement said that all the conversations were in Arabic, which was not contradicted in any of the evidence of the Claimants, but in a footnote in, in the Particulars of Claim, with a statement of truth, the Claimants say the conversations were in a mixture of Arabic and English. This difference may be significant for two reasons:
  23. 16.1 First, when the issue will turn on the words used by the parties, it is obviously better for a judge who understands the language used to hear the evidence of what was said. Translation of those words would be necessary in one way or another for a judge who was not well versed in the language in question, whether or not the evidence to him was given in his language through interpreters or by the protagonists who gave evidence in the judge's tongue of what they had, in whole or in part, said in a different language. The Court at this stage can take no view on the dispute as to what language or languages were used, save to note that the Claimants' case has been carefully framed in the Particulars of Claim to emphasise connections to England and the exaggeration in other respect of that connection and the downplaying of any connection to Bahrain gives me no confidence in the reliability of their evidence on these points.

    16.2 Secondly, in an area where nuances may well matter, when determining the tenor and meaning of the words used and the objective intentions of the parties, the Court in Bahrain will be more familiar with the culture of the protagonists discussing the arrangements in question, even if there is no actual recollection of the words used, the modes of expression or which language was used to say what.

  24. The other potentially relevant witnesses are Sheikh Abdulrahman Bin Mubarak and members of the parties' respective entourages: Mr Saffy who is the Defendant's personal secretary, Mr Al Quasim, his banker, Mr Dallal who is the First Claimant's personal assistant and an Indian businessman called Mr Bansal who was involved in the logistics of arranging meetings with stars in India, as well as, more remotely the possibility of evidence from the agents of the Bollywood stars and the stars themselves in relation to the quantum claimed, since, under the contract alleged, it fell to the Claimants to pay the stars for their time and trouble. None of these persons are ordinarily resident in the UK, although there appears to be little inconvenience in either the First Claimant or the Defendant attending a trial here. The witnesses the Defendant might call are like him, domiciled and resident in Bahrain but pay visits to London: those whom the Claimants might call are resident in Dubai but would come to England, save for Mr Bansal and any agents/stars who would presumably come from India. It would make little difference to most of these witnesses whether they had to travel to London or elsewhere in the middle east. They are all native Arab speakers, other than Mr Bansal, the Indian agent and the film stars whose evidence is only likely to go to the quantum of the claim and the amounts paid and to be paid for the meetings. Hindi would presumably be Mr Bansal's first language so that translation might well be needed whether the trial was in England or Bahrain.
  25. The only documentary records relating to the arrangement which have been produced by the parties are the notarial instruments which were made in Bahrain where the Defendant lives. No issue in truth arises as to their contents or interpretation although their significance in the context of an alleged exclusive and irrevocable agreement in relation to 26 stars is obviously critical. There is unlikely to be much other documentary evidence save for evidence of payments and arrangements made by the Claimants with the stars and their agents. The other relevant documents are not said to be in the jurisdiction. Such as they are, they will be found in Bahrain, Dubai or India, but documents can be readily transported or transmitted internationally.
  26. Whether or not the contract was in truth concluded in England by the instantaneous acceptance of an offer made by the Defendant on the telephone in England, it is rightly not suggested, by reference to English conflict of law principles, that the governing law is English law. Under Article 4 of the Rome Regulation, the law governing a contract for the provision of services is to be the law of the country where the service provider has his habitual place of residence. The habitual residence of the Second Claimant, for whom the First Claimant acted as agent, on the Claimants' primary case, is Dubai, although there was, until recently a representative office in Bahrain. The First Claimant's habitual residence is also Dubai. Although an argument could be made, given the Bahraini instruments for a connection with Bahrain, and, given the existence of the Bahrain office, for characteristic performance to be centred on Bahrain, the test is that of habitual residence. An English court would therefore have to hear evidence of the law of Dubai, if there were relevant principles of it which affected the dispute as to the terms of the arrangement, its exclusivity, its fixed and irrevocable nature and the remuneration agreed.
  27. The parties adduced evidence of the law of Bahrain. That adduced by the Claimants came from an individual with no experience of the law of Bahrain. Whilst he had expertise in Arabic law, he lacked credibility in any number of respects, because he referred inaccurately to the terms of some of the Articles of Bahrain laws, and did not refer to some of those Articles which were directly relevant to the issues he addressed. By contrast, Mr Zu'bi, whose report was endorsed by another Bahraini lawyer, had years of experience of practice in Bahrain and wrote with authority on the matters he addressed by reference to relevant Articles of the law which bore out what he said. He was scathing about the ability and qualification of the Claimant's expert to give evidence of the law of Bahrain and examination of their evidence, by reference to their exhibits fully supported his assessment. Whilst, of course, the evidence took the form of reports only, and neither lawyer was subjected to cross examination, wherever there was any conflict I found that Mr Zu'bi's report was supported by the materials he produced and I could not accept the contrary views put forward by the Claimant's expert.
  28. If the matter were to be heard in Bahrain, Mr Zu'bi said that the conflicts of laws principles applied there would not result in English law being the governing law, because the parties had not chosen it. Law No. 6 of 2015 sets out the principles of conflicts of law to which the Bahrain Court would have regard. If the Court determines, in accordance with Article 3 that the contract is governed by foreign law, it will apply such principles as are established by the parties (Article 6 (c)). Article 4 provides that the parties are free to choose the applicable law, which they have not done here.
  29. Under Law No.6:
  30. 22.1 Article 17 provides that the governing law of a contract is to be the law of the state in which the common domicile of the parties is located or, in the situation where there are different domiciles the law of the state in which the contract has been concluded, unless it is agreed or clear from the circumstances that another law is to be applied.

    22.2 It is, in my judgment, unreal to assume that the provisions of English law relating to offer and acceptance by instantaneous communications apply in Bahrain, with the result that the contract, as alleged, would be seen by the Bahrain Courts to have been concluded in England, but there was no evidence of Bahrain law on the point and the Court was directed to the fiction that, in the absence of such evidence, it is to be assumed that the provisions of the law of Bahrain are the same as English law. That, on the basis of the alleged contract, as carefully framed in the Particulars of Claim would result in the application of English law. If the assumption is not made, then the alleged contract may have been concluded in either England or the country from which the First Claimant called the Defendant, which did not appear from the evidence.

    22.3 Article 21 provides that the law applying to commercial agency contracts, commission agency and commercial representation shall be the law of the domicile of the agent, unless it is agreed or clear from the circumstance that another law is to be applied. There was no evidence as to the applicability of the latter to the facts here. But if it did apply then the relevant country is Dubai, since that is where the First Claimant is undoubtedly domiciled. It is also where the Second Claimant is domiciled, since the Bahraini office was only a representative office of the Dubai incorporated company, which did no business in Bahrain, the status of which, therefore, fell to be determined by reference to the law of Dubai under Article 12.

    22.4 The conclusions that the Bahrain Court might reach as to governing law would appear to be that the contract for services, of agency or representation is that of either England, Dubai or India, where the acts done in alleged performance took place. If Bahraini law fell to be applied, it would be better decided in Bahrain, without the need for expert evidence on Bahraini law, but that seems a remote possibility, and a Bahrain court would need evidence of foreign law, as would the English Court.

  31. In reality, however, the issue of governing law cannot be seen as of major importance because, whichever system of law applies, the issue are essentially issues of fact and there has been no suggestion that the decision as to the law governing the contract would make any difference to the result.
  32. Mr Stephen Nathan QC, representing the Claimants, relied on a series of deficiencies in the procedures of the Courts of Bahrain, matters which he prayed in aid of his submissions that England was the more appropriate forum. These were distinct from his submissions as to the risk of injustice in Bahrain which were essentially framed by reference to the risk of these Claimants being denied a fair trial in Bahrain by reason of the connection of the Defendant to the Royal family and the lack of security of tenure of Judges there who were reliant on the Executive for reappointment and could not therefore objectively be seen as independent, with consequent effect on the perception of their impartiality. Mr Andrew Lenon QC, for the Defendant, dealt with the points as part of his argument that the Claimant would receive a fair trial in Bahrain, but is it of no consequence that one party chose to characterise the alleged deficiencies under one limb of argument whilst the other party argued the points under another: all the more so, because I have concluded that there is nothing in the points raised, which I therefore deal with summarily.
  33. The Alleged Deficiencies in Bahraini Procedure

  34. The five alleged deficiencies all involve a comparison with another system of justice, which is not open to the court in the light of dicta in The Abidin Daver (HL) [1984] AC 398 at 410G and The Spiliada at pp. 482-3 and the earlier authorities to which reference was there made, save in the context of a risk of injustice. The five areas in question here were as follows: delay; no mandatory disclosure, no scope for proper cross-examination, the risk of "the decisive oath" and the absence of a regime for sufficient recovery of costs.
  35. As to delay, the complaint was made in the report adduced by the Claimants that a case might take over a year to reach a conclusion, because of the inquisitorial nature of the proceedings and the series of exchanges of submissions and counter-submissions which represented the normal course of proceedings. No suggestion was made that this might lead to injustice and a delay of that order could not be seen as likely to do so. An example was relied on by the Claimants where a case took four years to reach a conclusion, although the reasons for that were not apparent from the report. Whilst this Court seeks to bring cases to trial as soon as possible and it is the readiness of the parties as much as the availability of the court which is determinative in this respect, there is invariably time taken up to the first Case Management Conference in serving statements of case which, more often than not in cases involving foreign parties, (in anything other than a straightforward case or one where urgency is paramount and an order for an expedited trial is made) will not take place until at least three months from service of the Claim Form. A period of nine months from that point would again not be unusual before trial and often more, depending on the availability of the parties and their lawyers. Eighteen months or more from start to finish would not be seen as out of the way. Not only is this comparison of procedure inadmissible but it leads nowhere.
  36. The disclosure regime in Bahrain differs from that which operates in England, but is not dissimilar to that which operates in many civil law countries and in arbitration. There can be no serious suggestion of any risk to the administration of justice here, quite apart from the fact that there are unlikely to be documents which are genuinely material to the central issues in dispute. Even if there were a material difference, it could have no serious impact on the progress of the case or the result. The expert consulted by the Claimants stated that the principle of "discovery" is unknown in the Bahraini legal system and that parties only produce to the court the documents and evidence which advance their case, without any obligation to produce documents which undermine it and advance that of the opposing party. As Mr Zu'bi pointed out however, Articles 140-145 of the Civil Procedure Code provide a regime for requesting the production of documents by the other party and for the Court to order such production. It is not necessary to recite the terms of the Articles save to point out that Article 140 makes specific reference to the production, on request, of documents which are documents which benefit both parties or establish their mutual rights and obligations and that Article 141 requires the request to set out (inter alia) a description of the documents in question, the content of the documents in as much detail as possible and the grounds on which it is said the documents should be produced. Once again, not only is the comparison made invidious and impermissible but it is of no substance in any event. The disclosure regime may be different but there is nothing unusual about it nor can it be said to lead to any injustice in the present case.
  37. Contrary to the assertion of the expert consulted by the Claimants, there is no prohibition of inhibition on the ability of a party to adduce oral evidence or to cross-examine the key witnesses of the other party. That expert stated that "in civil matters there are normally no oral witness hearings and there is no provision for cross-examination. Cross-examination does not take place". This is a distortion of the true position which is set out in Article 58 of the Civil and Commercial Procedure Law which expressly provides for the examination in chief, the cross-examination and the re-examination of witnesses and for the court to ask questions also, whilst controlling the conduct of the proceedings. Mr Zu'bi' s evidence was that oral witness hearings were often held when the Court or either of the parties wished to submit evidence through witnesses or wished a matter to be clarified (presumably from a witness statement). The reliance of the Claimants on the decision of Burton J in Al Jaber v Sheikh Walid Bin Ibrahim [2016] EWHC 1989 (Comm) is therefore misplaced, even if there are rare cases where the English Court would take it upon itself to consider the foreign procedure as a deficient way of discerning the truth, which must be a rare case indeed. There is no material difference here between the procedures open to the parties in either jurisdiction.
  38. The ability to invite a party to swear a "decisive oath" is a feature unknown to the English Courts but it is plain from the terms of the Law of Evidence in Civil and Commercial Matters (as amended), which was exhibited to Mr Zu'bi's report, that the consequences are not as portrayed by the expert consulted by the Claimants who said that "the Defendant can simply take the conclusive/decisive oath and that would end the claim in his favour". As appears from the evidence before the Court, the procedure in fact involves the invitation by one party to the other to take an oath in relation to a particular fact that the inviting party wishes to establish and which is known personally to the other party. The terms of the admission sought have to be carefully defined and the Court supervises its form and does not allow the oath to be administered if it considers it unjust to do so, or considers that the procedure is being used oppressively. Thus the Defendant could only take the "decisive oath" if invited by the Claimants to do so, a tactic which no doubt would only be employed where the Claimants were confident of the result, since they would be bound by the answer.
  39. Under Article 114 each party can invite the other party to take the decisive oath but the court can refuse to allow it. The other party can reciprocate and once the invitee has agreed to take the oath, the invitation cannot be withdrawn. In translation there appears the following wording which limits the application of the oath but not in a manner of which I can make sense: "However no reply shall be admitted if the oath concerns an occurrence involving the two litigants but shall only be with the exclusive involvement of the person to whom it is tendered". Whether this applies to the reciprocal invitation or the original invitation is unclear but as it is all subject to the control of the court, this may not be of significance. The effect of giving such an oath is spelt out in Articles 124 and 125, as preventing the presentation of other evidence with regard to the fact admitted on oath and the grant of a favourable judgment on the issue and the loss on that point if there is a refusal to take the oath. As explained by Mr Zu'bi, there is a difference between the Decisive Oath and the Supplementary Oath which is ordered by the Court but in either event, the effect is not do deprive either party of the benefits or rights under Court Procedures to prove or defend its case.
  40. Whilst this is, to English eyes, an unusual procedure, it is plain that it cannot be used arbitrarily by the Defendant to achieve a result in his favour as the Claimants suggest. The Claimants' expert either does not understand the process or has deliberately misrepresented its effect, as even a superficial look at the provisions shows. Again there is nothing in the point raised which gives weight to any allegation of a risk of injustice or allows for a comparison to be made with a notice to admit facts in this jurisdiction.
  41. As to costs, there was agreement between the experts that a successful party in Bahrain would normally be awarded costs but that such costs would not fully compensate a party for what it had expended. That, of course, is the normal position in this country, although the differential between what is spent and recoverable in Bahrain is apparently greater. In the US and many other jurisdictions, costs are not usually recoverable at all and that is not something which weighs in the scales where the sums involved are large, as here.
  42. None of these five factors in themselves, whether individually or taken together assist the Claimants in their submissions on forum conveniens and the appropriate jurisdiction for the case to be tried in the interests of the parties and the ends of justice, whether seen in the context of the first limb of the argument about general suitability or in the context of the second limb as to the risk of injustice in the Courts in Bahrain.
  43. Counsel for the Defendant, Mr Andrew Lenon QC, submitted that the appropriate venue for trying a dispute about agency arrangements agreed orally in Arabic by two individuals based in Bahrain, negotiated at meetings in Bahrain, evidenced by instruments issued in Bahrain and governed by Bahrain law, with witnesses living in Bahrain, and which had nothing to do with England or English law, is clearly Bahrain, not England. That submission, however does not represent the case put by the Claimants, which cannot be dismissed as fanciful, nor the overall position when regard is had to the interests of both of the parties and the ends of justice. This is a case where the connections both to England and Bahrain are limited and, because service was effected as of right, within this jurisdiction, the onus is on the Defendant to show that Bahrain is clearly and distinctly the more appropriate forum. That, in my judgment, he cannot do. Whilst the Claimants exaggerate the connections with England and have apparently taken steps since the events in question to increase connections here and reduce them in Bahrain, whilst downplaying the connections with that jurisdiction in the shape of the Defendant's domicile and the location of the initial conversations which formed part of the alleged contract, none of the factors which connect the case to Bahrain make it clearly the more appropriate forum. In these circumstances, the proceedings ought to be permitted to continue here, without a stay in favour of proceedings to be pursued in the Courts of Bahrain.
  44. The Risk of Injustice in Bahrain

  45. In the light of my decision on the first limb, it is not necessary for me to consider this aspect but I do so, having come to the conclusion that the Claimants cannot show that there is a real risk of injustice because the Defendant is a member of the Royal Family and the judiciary does not have security of tenure in the same way as English judges do.
  46. In the Abidin Daver (ibid) at pp. 410-411, Lord Diplock stated:
  47. "The possibility cannot be excluded that there are still some countries in whose courts there is a risk that justice will not be obtained by a foreign litigant in particular kinds of suit whether for ideological or political reasons, or because of the inexperience or inefficiency of the judiciary or excessive delay in the conduct of the business of the courts, or the unavailability of appropriate remedies. But where there is already a lis alibi pendens in a foreign jurisdiction which constitutes a natural and appropriate forum for the resolution of the dispute, a plaintiff in an English action, if he wishes to resist a stay upon the ground that even-handed justice may not be done to him in that particular foreign jurisdiction, must assert this candidly and support his allegations with positive and cogent evidence".

    Although there is no lis alibi pendens here, the principle holds good for a forum non conveniens case.

  48. In Al-Koronky v Time Life Entertainment Group Limited [2006] EWCA Civ 1123, at paragraph 43 of the judgement of the Court of Appeal. Sedley LJ said that "if any allegation as to ineffectiveness, let alone partiality, is to be made against the judiciary of a foreign state, it must be supported by much more than the mere generalised assertion of an unidentified lawyer with knowledge of the foreign law. Properly attested examples should be given which can then form a suitable evidential foundation for any such conclusion, before any answer can be expected from a claimant."
  49. The Privy Council, in Altimo Holdings v Kyrgyz Mobil Tel Ltd (PC) [2012] 1 WLR 1804 per Lord Collins, at page 1828 and paragraphs 94-97, stated that "the relevant question to which the cogent evidence will go is to the risk that justice will not be done in the foreign jurisdiction, and that it is not necessary to establish, on the balance of probabilities, that the risk will eventuate" citing two previous decisions of the Court of Appeal for that proposition.
  50. "The better view is that, depending on the circumstances as a whole, the burden can be satisfied by showing that there is a real risk that justice will not be obtained in the foreign court by reason of incompetence or lack of independence or corruption. Of course if it can be shown that justice will not be obtained, that will weigh more heavily in the exercise of the discretion in the light of all other circumstances ... Comity requires that the court be extremely cautious before deciding that there is a risk that justice will not be done in the foreign country by the foreign court, and that is why cogent evidence is required. But contrary to the appellants' submission, even in what they describe as endemic corruption cases (i.e. where the court system itself is criticised) there is no principle that the court may not rule."
  51. The authors of Dicey & Morris at paragraph 12-040 state that:
  52. "since 2009 claimants have been more successful in resisting stays of proceedings, or even obtaining permission to serve out, on the basis that, as the foreign court cannot be trusted to do justice, the case should be allowed to proceed in England. Of course where the civil administration has utterly broken down, a stay in favour of the courts of that place cannot be granted. The same principle will surely apply whether state is fully functioning but in so depraved a fashion that the very idea that there might be a fair trial there is an absurdity. But in less extreme cases, where the claimant is able to persuade the court that there is a risk that the foreign court will single out the claimant or his claim for flagrantly unjust treatment, or that the foreign court is generally and seriously unreliable, it now appears that the court will not generally order a stay of proceedings. The evidence required to support this contention need not be particular to the claimant or his individual claim (though it may be more specific if it is) but maybe based on more general evidence of judicial failure or misconduct in relation to claims of the type advanced by the claimant."

    Reference has already been made to Deripaska v Cherney in this context.

  53. The expert consulted by the Claimants had studied Iraqi and Islamic law, practiced law in the UAE as in-house counsel for a major UAE state entity until 1980 and had appeared before the UAE courts. He had no first-hand experience of the courts in Bahrain. He made reference to the Bahrain constitution of 2002 which was amended in 2012 which contained provisions regarding the independence of the judiciary but asserted that the practice was very different from what was written. He said that judges were appointed and removed from office by Royal decree and that, unlike the United Kingdom, which is a constitutional monarchy, in Bahrain the King exercised executive powers and played a very active role in politics and running the affairs of the Kingdom. He gave his opinion that "the absence of effective security of tenure for judges casts doubt over the real and effective independence of the judiciary. Judges will be prone to favour a party to the proceedings before them should he be a member of the Al Khalifa clan."
  54. In support of that contention he referred to a TV broadcast that he had viewed as well as two examples which were reported in the Bahraini media. In the first example it was reported that the King had invited eight Sheikhs to take the oath of allegiance before him before appointing them as judges of the Sharia courts. He referred to the King relieving judges of their posts. Sheik Jalal Al Sharqi, a Shari'a judge, is reported to have said that he had been relieved of his post and was waiting to be given other work without losing his benefits. The Claimants' expert said that it was not taking the oath that was at issue but the show of authority that the King drove home. "Relieving judges of their post without process or reason is the other side of stressing the executive authority over the judiciary." The expert went on to say that there was a second example which emerged from newspaper reports when the King ordered sweeping changes to the judiciary, appointing, promoting and demoting or relieving from office some 136 judges and prosecutors. Those affected included judges of all levels, from the Court of Cassation downwards. Many of the appointees sent letters of gratitude to the King for his trust in appointing them.
  55. In his witness statement, he said that Bahrain has some 170 senior judges, most of whom are Bahraini nationals whilst some came from other Arab countries. Bahrainis were appointed by the Prime Minister in the case of junior judges, whilst more senior judges were appointed by the King himself. Non-Bahrainis were appointed pursuant to contract for a limited period of time. Recently some of them had been for the first time promoted to a higher level. He opined: "In my opinion, this raises a legitimate concern that those judges may be inclined, whether consciously or subconsciously, to try to win the favour of the King in order to secure their continuance in office or promotion."
  56. Mr Zu'bi was dismissive of these allegations. He referred to the constitution in more detail and in particular to Article 18, which is headed "Human dignity, Equality". This provides that "people are equal in human dignity, and citizens are equal before the law in public rights and duties. There shall be no discrimination among them on the basis of sex, origin, language, religion or creed." Article 31 provided for the rule of law, Article 32 for the separation of powers and Article 33 set out the position of the King, including his duties to safeguard the supremacy of the constitution and law and to care for the rights and freedoms of individuals and organisations. At subparagraph (h) it is provided that he should "chair the Higher Judicial Council" and "appoint judges by Royal Orders, as proposed by the Higher Judicial Council." This body, according to Article 105, is established by law to supervise the smooth running of work in the courts and their surrounding organs. The powers of the Council are prescribed by law. By Decree Law No 26 of 2013, the King delegated to the President of the Court of Cassation the function of chairing the meetings and deliberations of the Council, as its president. The Council has an independent annual budget which is prepared by the President of the Court of Cassation who discusses it with the Minister of Finance. Regulations governing the salaries, allowances and privileges of judges are issued by Royal order pursuant to recommendations made by the Council, independently of the financial and administrative rules of the civil service.
  57. Under Decree Law No 42 of 2002, promulgating the law of the Higher Judicial Council (as amended), Article 34 provides that "judges are not subject to dismissal except in accordance with the procedures provided in the law". Their term of office is not to terminate except for one of the following reasons: Death; resignation; the lapse of the appointed term of judges under contract or under secondment (any termination of the contract or secondment prior to the expiry of the period can only take place by resolution of the Higher Judicial Council): attainment of the age of retirement: medical incapacity: dismissal pursuant to a disciplinary judgement in accordance with the procedures provided by this law: assignment to another position with consent.
  58. Mr Zu'bi's evidence was that the provisions of the constitution were observed in practice, that they were clear and respected at all times. He noted that no evidence had been produced by the expert engaged by the Claimants to the contrary. In practice judges were appointed by Royal decree at the recommendation of the Council and were disciplined by the latter pursuant to article 1 of Law No 35 of 2010. A full-time secretary general had been appointed to the Council, who had been entrusted with management of its affairs under the direction of the president and board of directors of it. There was no basis for the suggestion that judges would be prone to favour a party to the proceedings before them should he be a member of the Al Khalifa clan. Mr Zu'bi himself had conducted many cases for and against members of the King's family and gave three examples of decisions/judgements against such members. He said it was clear that the judiciary in Bahrain was independent, of a high standing and had the full protection of Article 104 of the constitution which provided both that "the honour of the judiciary, and the probity and impartiality of judges is the basis of government and the guarantee of rights and freedoms" and that "no authority shall prevail over the judgement of a judge, and under no circumstances may the course of justice be interfered with. The law guarantees the independence of the judiciary and the law shall lay down the guarantees for judges and the provisions pertaining to them." He said that lawyers practising in Bahrain and ordinary Bahrainis would confirm that members of the bar and the people have full confidence in and respect for the judiciary, referring to major investment cases between foreign international banks and other parties in the courts and in the Bahrain Chamber for Dispute Resolution, without any complaint or criticism.
  59. As pointed out by Mr Zu'bi, the ceremonial function of oath taking of Judges in front of the King, says nothing about potential interference by the executive in the functions of the judiciary. The reference by the Claimant's expert to one judge of the Shari'a Court being relieved of his judicial duties for reappointment elsewhere in the government was to a matter handled by the Higher Judicial Council and did not involve any interference by the King. That had taken place in 2004. (The Shari'a courts are, in any event, separate from the civil law courts where any dispute of the kind which arises in these proceedings would take place.) The notion that a judge had been relieved of his post without process or reason and that this had been done by executive authority was therefore without foundation. The other example given by the expert engaged by the Claimants was in fact a major reorganisation of the judicial body, following careful consideration and recommendation by the Higher Judicial Council. This was a major reform of the organisation and was once again not an illustration of executive interference by the King.
  60. So far as concerns the question of security of tenure, Mr Zu'bi said that the non-Bahraini judges were selected from among senior experienced judges of standing and reputation from at least four Arab countries, namely Jordan, Egypt, Sudan and Tunisia. Some of those had served for over 40 years as judges and had rendered great service to the judiciary of Bahrain in training and teaching younger generations of judges and advocates. Some had been granted Bahrain citizenship in order to give them more stability and permanency but, regardless, there was no reason at all for any concern that those judges might be inclined, whether consciously or subconsciously to try to win the favour of the King or any of the officials. He said that the records of the court spoke for themselves in relation to the integrity and self-respect of judges sitting in small and major cases and irrespective of whether litigants were Bahrainis or non-Bahrainis. All judges had to go through a process of qualification at the Judges Institute and the records of the Bahrain courts were full of references to cases and arbitration procedures to which the Royal Court, the Prime Minister, ministers and other officials had been, or are currently parties, either as defendants or plaintiffs in cases which were, and continue to be, handled in a proper and professional manner as all parties are treated as equal under the law. He stated that there is no evidence of any bias on the part of the Bahrain courts on account of any of the parties being members of the Royal family or being a non-Bahraini national.
  61. The Claimants relied upon published reports of human rights organisations relating to the operation of the "National Safety Court" under martial law provisions relating to political opponents of the King. Concerns have been expressed as to the way in which those involved in an "uprising" against the King have been dealt with without due process. Valid criticisms appear to have been made but none has any bearing on the operation of the civil and commercial court system. Moreover a National Organisation of Human Rights was established by Law No 26 of 2014 as modified in 2016. The organisation was set up by law as a legal body completely independent financially and administratively to undertake its objectives in supporting developing and safeguarding human rights, promoting consciousness thereof and securing compliance with them.
  62. Whilst Bahrain's constitution is comparatively recent, and it is developing as a democracy, there is no sufficient basis for the Court to find that there is a real risk that the claimants would not receive a fair trial in Bahrain because of the identity of the defendant as a member of the Royal family and any lack of security of tenure on the part of all the judges. If matters are looked at in the round, there is not the slightest evidence of any partiality or bias on the part of judges in the civil and commercial courts. No cogent evidence has been adduced and no attested examples have been provided of any case where a judge could be said to have been influenced, consciously or subconsciously, by the fact that a claimant was a foreigner and the Defendant a member of the Royal family.
  63. In these circumstances, I do not find that there is any real risk of injustice, were I to take the view that the courts of Bahrain represent clearly the most appropriate forum for the determination of the dispute in the interest of both the parties and the ends of justice. As I have concluded that the Defendant has failed to establish that proposition, the point does not arise.
  64. Threats, Intimidation and Harassment

  65. Apart from this general evidence as to the legal system in Bahrain, the First Claimant gave evidence of alleged threats and harassment which he said or inferred had come from the Defendant or his entourage, in particular Mr Saffy. This was denied by both the Defendant and Mr Saffy. The administrative difficulties encountered by the First Claimant, to which reference is made in relation to fees owed in relation to the Bahrain office closure, appears far-fetched as an allegation of harassment by the Defendant or those who take his part. It was accepted that I could reach no conclusions on the allegations of intimidation but I was invited to take into account the genuine fear of the First Claimant should he be driven to resort to the Bahraini courts for redress. It appears to me that any propensity to intimidate is unlikely to be affected by the venue of the litigation and the nature of the alleged threats was directed at pursuit of the claim generally. Whilst the perception would be that the First Claimant would be more at risk when pursuing proceedings in Bahrain, on entry there, courts are capable of dealing with those who intimidate by means of committal for contempt of court. In the absence of cogent evidence that the Bahraini courts could not deal with matters of this kind, I would not have found that the existence of these alleged threats would constitute a basis for not staying the English proceedings, had I found that Bahrain was otherwise the most appropriate forum.
  66. Conclusion

  67. For the above reasons, the Defendant's application must fail and the action must be allowed to continue in this jurisdiction. It appears to me that, absent any special considerations of which I am unaware, costs must follow the event. It may be that the parties can agree the appropriate order. It will also be necessary for directions to be given, but these too may be capable of agreement.
  68. It is my intention to hand down this judgement on Tuesday of next week and if the parties can agree the consequential orders which follow from this judgement and submit a draft for my approval, so much the better. If not I will make any necessary rulings on that occasion.


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URL: http://www.bailii.org/ew/cases/EWHC/Comm/2017/1198.html