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You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Commercial Bank of Dubai PSC & Ors v Al Sari & Ors [2024] EWCA Civ 643 (12 June 2024) URL: https://www.bailii.org/ew/cases/EWCA/Civ/2024/643.html Cite as: [2024] EWCA Civ 643 |
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ON APPEAL FROM THE HIGH COURT OF JUSTICE
BUSINESS & PROPERTY COURTS OF ENGLAND & WALES
KING'S BENCH DIVISION
COMMERCIAL COURT
Mr Justice Butcher
Strand, London, WC2A 2LL |
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B e f o r e :
LORD JUSTICE MALES
and
LADY JUSTICE ELISABETH LAING
____________________
(1) COMMERCIAL BANK OF DUBAI PSC (2) HORTIN HOLDINGS LIMITED (3) WESTDENE INVESTMENT LIMITED (4) LODGE HILL LIMITED (5) VS 1897 (CAYMAN) LIMITED |
Respondents/Claimants |
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- and - |
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(1) ABDALLA JUMA MAJID AL SARI (2) MAJID ABDALLA JUMA AL SARI (3) MOHAMED ABDALLA JUMA AL SARI (4) FAL OIL CO LLC (5) INVESTMENT GROUP PRIVATE LIMITED (6) IGPL GENERAL TRADING LLC (7) GLOBE INVESTMENT HOLDINGS LIMITED (8) MENA INVESTMENT HOLDINGS LIMITED (9) MAS CAPITAL HOLDINGS LIMITED (10) HAMAD SAIF HAMAD ABDALLA ALMHEIRI |
Appellants/Defendants |
____________________
James Leonard KC and Charlotte Elves (instructed by Janes Solicitors) for the Second Appellant
Anthony Peto KC and Andrew Trotter (instructed by Jones Day) for the Respondents
The Third to Tenth Defendants did not take part in the appeal and were not represented
Hearing date: 23 May 2024
____________________
Crown Copyright ©
LORD JUSTICE MALES:
Background
The worldwide freezing orders
(1) to disclose all of their assets worldwide with a value exceeding £50,000, together with all bank accounts and companies over which they had control, whether directly or indirectly, within 24 hours;
(2) to disclose the location of all 'Asset Documents' (defined to mean documents evidencing the existence or balance of bank accounts and assets exceeding £50,000 in value) within 48 hours;
(3) to disclose any disposals of assets to related parties or disposals made at an undervalue between 1st October 2015 and 18th February 2022 within five working days;
(4) to identify any third parties holding Asset Documents, also within five working days;
(5) to deliver up any Asset Documents in their custody or possession within seven working days;
(6) to serve a confirmatory affidavit, including details of any asset subject to an attachment or similar order in the United Arab Emirates, also within seven working days; and
(7) to give written instructions to third parties holding Asset Documents to deliver them up, and to deliver up copies of those instructions, within five days of the continuation order.
'Pursuant to CPR 6.15(2), the steps taken by the Claimants to notify the Defendants of the Service Documents are deemed to be good service. The Claimants have permission to serve all further documents in these proceedings by any or all of the following alternative means, in addition to or alternatively to those set out in paragraph 3 of the Service Order (as amended): …
2.2 the First Defendant: by sending the documents and/or a link to them by WhatsApp and/or text message to [a telephone number ending '4488] …'
The contempt application
The liability hearing
'(i) Whether the respondents have been served with the relevant documents, including notice of this hearing;
(ii) Whether the respondents have had sufficient notice to enable them to prepare for the hearing;
(iii) Whether any reason has been advanced for their non-appearance;
(iv) Whether by reference to the nature and circumstances of the respondents' behaviour, they have waived their right to be present; [i.e. is it reasonable to conclude that the respondents knew of or were indifferent to the consequences of the case proceeding in their absence?]
(v) Whether an adjournment would be likely to secure the attendance of the respondent or facilitate their representation;
(vi) The extent of the disadvantage to the respondents in not being able to present their account of events;
(vii) Whether undue prejudice would be caused to the applicant by any delay;
(viii) Whether undue prejudice would be caused to the forensic process if the application was to proceed in the absence of the respondents;
(ix) The terms of the 'overriding objective' [including the obligation on the court to deal with the case justly, including doing so expeditiously and fairly and taking any step or making any order for the purposes of furthering the overriding objective].'
'38. I find, therefore, that there was non-compliance in the respects which I have identified, and I further find that the First to Sixth Defendants are in contempt, by reason of that non-compliance, in the following respects: first, there was contemptuous non-compliance in a timely fashion with the order for asset disclosure. The CRS Defendants were obliged to give asset disclosure but failed to do so by the return date or for up to 12 weeks after their obligations fell due to be performed. Calver J said, in paragraph 15 of his judgment of 11 March 2022 ([2022] EWHC 705 (Comm)) that this was a "serious contempt". I agree. I am sure that the delay was deliberate in order in part to search for a way of avoiding disclosing the relevant assets. That is a conclusion which I reach in light of what has transpired regarding the Sharjah WFO proceedings, the inadequacy of the Defendants' excuses for the delay, the weakness of the arguments for the limits of disclosure ultimately produced in Majid 2, and the propensity of the First to Sixth Defendants to disobey court orders shown by the history of non-compliance in these proceedings.
39. I am also sure that there was contempt in the failure by the First and Second Defendants to disclose assets exceeding £50,000 and their bank accounts. I am sure of this for the reasons set out in Mr Richards' fourth affidavit. In particular I am sure that there was a failure by Abdalla Al Sari to disclose his direct shareholding in Sari Investments LLC. There was a failure by Majid Al Sari to disclose his direct shareholding in IGPL Investments LLC and IGPL. There was a failure by Abdalla and Majid Al Sari to disclose assets or bank accounts of the Al Sari property companies which they managed and which, it is to be inferred for the reasons given in Mr Richards' fourth affidavit, they had power to deal with as their own. In particular they failed to disclose the funds or bank accounts of IGPL GT used to pay CRS' fees, and a yacht owned through IGPL GT. Abdalla Al Sari failed to disclose any assets or bank accounts whether in the UAE or elsewhere; he gave an express refusal to disclose assets in the UAE. I find it highly unlikely that he owns no assets and has no bank accounts. Majid Al Sari refused to disclose any assets in the UAE. He accepts part ownership of the Al Sari home compound. He did not say that there were no such assets, and FAL, IGPL, and IGPL GT, who were also respondents to the worldwide freezing order in their own right, have refused to disclose any assets at all. In those respects I regard there as having clearly been a contemptuous non-compliance with the orders in question.
40. Thirdly, there was a failure to disclose disposals to related parties or at an undervalue. Majid 2 did not purport to make any disclosures of related party or undervalue disposals, as required by paragraph 10(1)(d) of the worldwide freezing order. When the Claimants sought clarification of that, CRS said, by letter of 2 August 2022, that there were no such disposals by Abdalla or Majid Al Sari, considering the terms of paragraph 10(1)(d) of the worldwide freezing order, and, as regards the Fourth to Sixth Defendants, none that they were permitted to disclose. However, as regards the First and Second Defendants, that has not been confirmed on affidavit as it should have been. As regards the Fourth to Sixth Defendants, that letter appears to show that there have been such disposals but they refused to disclose them.
41. Fourthly, in relation to asset documents, under the worldwide freezing order the Defendants were required to give details of where asset documents were located, and the third parties holding such asset documents, as well as to deliver up any asset documents. These obligations were simply ignored. Majid 2 does not purport to comply with these obligations.
42. Therefore, in that respect, as well as the others, I am sure that the First to Sixth Defendants are in contumelious default of the orders of the court.'
Majid 3
'If the First and Second Defendants wish to rely on the assertion that they were unaware of the hearing on 4 October 2023, they shall file and serve any affidavit evidence to that effect on which they seek to rely by no later than 4 p.m. on 10 November 2023, including any statement they wish to make (a) that they were unaware of the 4 October 2023 hearing prior to that date; and (b) as to the time at which and the manner in which they became aware that hearing had occurred.'
'8. I apologise to the Court (on behalf of myself and my father) for a lack of engagement in these contempt proceedings so far. The truth is, the last contact I had with the solicitors acting for me in the underlying proceedings was in December 2022. From that point onwards, I have been completely in the dark about what has been happening.
9. I now understand my previous solicitors, Charles Russell Speechly (CRS), came off the Court record in February 2023. As I said above, as far as I can remember my last contact with them came two months previously, on 15 December 2022. At that stage, whilst I was aware that Contempt proceeding had been intimated, I was unaware that Contempt Proceedings had been issued against my father and me.
10. Since then, neither my father nor I have been aware of any developments in these proceedings. I did not see, nor was I aware of, any correspondence, Court Orders, Applications, or hearings. This includes, for example, the hearing to deal with my application challenging the Court's jurisdiction, which I now understand was dealt with in a hearing by Mr Justice Bright on 13 and 14 June 2023, with a Judgment on 14 July 2023. Had I known that the hearing was taking place, I would have wish to have attended/arranged for representation, as I had understood we had a good case concerning a jurisdictional challenge.
11. It is against that background that I was most surprised to receive notification on or around 10th October, after documents were delivered to my house by courier, that on 4 October 2023, the Court held my father and me in Contempt of Court, when we received no notification that the hearing would take place. Had I been aware of that hearing, I would have ensured that I obtained legal representation so that my position could be protected.
12. Upon becoming aware of the findings against us, my father and I took urgent steps to instruct English solicitors and counsel, which led to Janes Solicitors and Sean Yates attending the hearing on 27 October 2023.
13. Again, I want to reiterate that had I known about this earlier, I would have instructed solicitors earlier. I understand that Contempt Proceedings are serious, and although we do not live in the UK, my and my father's liberty is at stake. Given that I wish to continue doing business in the UK and would want to travel to the UK for that purpose, it would always have been in my interests to defend myself in these proceedings to avoid any warrant of committal being issued against me.'
The sentence hearing
'20. Thus, as I have already set out, Majid 3 contains the statement that, as at 15 December 2022, while he was aware that Contempt Proceedings had been intimated he was unaware that Contempt Proceedings had been issued against him and his father.
21. That, in my judgment, is patently untrue. The contempt application had been issued on 12 May 2022, the day before Majid 2 was served. It was while CRS were representing the First and Second Defendants; indeed, CRS continued on the record for them for more than 8 months thereafter. CRS's correspondence with the Claimants' representatives indicates quite clearly, and unsurprisingly, that CRS had sought instructions in relation to various matters, and must have made their clients aware of the contempt application, the need to file evidence in response to it and the fees which would be charged in respect of their work on the application. The details are set out in paragraph 10 of Mr Richards's Thirteenth Witness Statement. Equally, the evidence referred to in paragraph 11 of that Witness Statement itself indicates that CRS had brought the contempt application to the attention of their clients.
22. Majid 3 also says that, since 15 December 2022 he had been 'completely in the dark about what has been happening' in these proceedings. This is based on the supposed fact that 'the last contact' he had with CRS was in December 2022; and that he 'now understands' that they came off the record in February 2023; but that he was aware of no developments since December, including the hearing of the Defendants' own jurisdiction challenge which was heard by Mr Justice Bright in June 2023.
23. In my view it is inconceivable that CRS did not communicate with the First and Second Defendants in the period between 15 December 2022 and when they came off the record. When they came off the record, as material available to the Claimants demonstrates, this was on the basis of various breaches of the terms of CRS's engagement by the Al Saris, including non-payment of CRS's fees.
24. I have no doubt at all that, during that period, CRS will have communicated with their clients by means which they had reason to believe would be effective in bringing matters to the clients' attention. If, which I think is unlikely, the First and Second Defendants were unaware of what was being communicated, it must have been because they were taking good care not to see what was in front of them.
25. The statement in Majid 3 that 'the last contact I had with [CRS]' was on 15 December 2022 is thus, I am sure, very misleading. It may be that 15 December 2022 was the last time that he contacted CRS. As I have said, I am sure that it will not have been the last time that they contacted him. As to his statement that he was thereafter completely in the dark, I am sure that if he was, which I very much doubt, it was self-imposed darkness.'
'26. The same applies in relation to the period after CRS came off the record. Numerous communications were sent by Jones Day to an email address which had been ordered as effective alternative service. There was no indication that emails to that address were not received. There was a series of notifications produced by Jones Day's server stating that delivery to the recipients or groups was complete. There were no 'unable to send' or other bounce back messages in respect of that email address. Furthermore, Majid 3 does not say that the emails were not received at that address; nor does it say that that the address was inoperative. Indeed, it is very thin on detail generally.'
Submissions on appeal
'79. Contempts of court have traditionally been classified as being either criminal or civil. Proceedings for civil contempt are sometimes described as "quasi-criminal" because of the penal consequences that can attend the breach of an order (or undertaking to the court). They are criminal proceedings for the purpose of Article 6 of the European Convention on Human Rights ("Article 6"). The charges raised have to be clear; the criminal standard of proof applies; and the respondent has a right to silence. There must be a high standard of procedural fairness.'
Was service of the Listing Order valid?
'(1) Unless the court directs otherwise in accordance with Part 6 and except as provided in paragraph (2), a contempt application and evidence in support must be served on the defendant personally.
(2) Where a legal representative for the defendant is on the record in the proceedings in which, or in connection with which, and alleged contempt is committed—
(a) the contempt application and evidence in support may be served on the representative for the defendant unless the representative objects in writing within seven days of receipt of the application and evidence in support;
(b) if the representative does not object in writing, they must at once provide to the defendant a copy of the contempt application and the evidence supporting it and take all reasonable steps to ensure the defendant understands them;
(c) if the representative objects in writing, the issue of service shall be referred to a judge of the court dealing with the contact application; and the judge shall consider written representations from the parties and determine the issue on the papers, without (unless the judge directs otherwise) an oral hearing.'
'I can for my part well understand that Goulding J … came to the conclusion that there was a strong probability … that Mr Keane in fact knew perfectly well that the hearing was to be on 1 February. But what is said by Mr Munby is that, however that may be, where a hearing is adjourned to a date to be notified, the new date must be notified to the alleged contemnor by personal service. It is quite different if the court adjourned to a date of which the defendant is told in court.
I think that is right, because the reasons for requiring personal service of the notice of motion in the first place apply equally to an adjourned hearing if it is not merely a continuation of the hearing, but consists either of a revival of the notice of motion, as was the case in Aldous v Whetton (unreported), 29 November, 1978; Court of Appeal (Civil Division) Transcript No. 78 of 1978 or, as here, an adjournment to a date to be fixed.'
' … committal for contempt of court is an extreme remedy and, whatever the relationship between the solicitors may be and whatever knowledge in fact the person to be proceeded against for contempt of court has, none the less the committal proceedings will be bad unless the rules are strictly complied with. The reason for this of course is that committal proceedings are not like civil actions for breach of contract: they concern the liberty of the subject.'
Should the appellants be allowed to take the point?
'95. The court has a general discretion as to whether to allow new points of law to be taken on appeal, the ultimate test being whether it is in the interests of justice, applying the principles identified in the cases cited above. That will depend upon an analysis of all the relevant factors, which include the nature of the proceedings which have taken place in the lower court, the nature of the new point, and any prejudice that would be caused to the opposing party if the new point is allowed to be taken, especially where it would have required additional evidence.'
'37. The third reason [for not producing documents given in Majid 2] was, as I have said, a reference to UAE confidentiality rules. The legal opinion relied on asserted that Abdalla and Majid Al Sari could be exposed to penalties under the UAE Penal Code, or consequent civil liability, for disclosing information confidential to the companies of which they were the managers. However, in the first place, I am not satisfied that, even if that were the case, it would be a justification for non-compliance with the disclosure orders in the worldwide freezing order, and the continuation order. If well-founded at all, it would have been a basis to have sought a variation or amendment to the worldwide freezing order or continuation order. Secondly, there is good reason to believe that it is a wrong view of the law, because disclosure is not prohibited under the relevant UAE provision if it is permitted by law, and that, in the view of Mr Al Zarouni, the expert whose report has been exhibited by the Bank, would include the orders of a foreign court. Thirdly, even if the legal opinion were correct, the risk of prosecution of Abdalla or Majid Al Sari would appear to rest on the fanciful suggestion that the Al Sari companies under their control would refuse to authorise the disclosure, which is particularly unrealistic in circumstances where three of the companies are themselves the subject of the worldwide freezing order and required to give disclosure.'
'48. The second [argument] related to the supposed lack of independence of Mr Al Zarouni. The complaint is that Mr Al Zarouni lacked independence because he had previously been instructed on various other matters by the Al Saris. In my judgment the complaint goes nowhere. My decision of 4 October 2023 did not depend on findings as to UAE law. The primary basis of my finding in para. 37 was that, even if there were an argument that Abdalla and Majid Al Sari could have been exposed to penalties under the UAE Penal Code, that would not have been a justification for non-compliance, as opposed to seeking some variation or amendment of the order. I also found that there was no real risk of prosecution even if there were some possible penalty under UAE law.'
Other matters
Sentence
Conclusion
LADY JUSTICE ELISABETH LAING:
LADY JUSTICE NICOLA DAVIES: