This judgment was handed down by the Judge remotely by circulation to the parties' representatives by email and release to The National Archives. The date and time for hand-down is deemed to be 14:00 on Tuesday 15th July 2025.
Mr Justice Calver :
INTRODUCTION
- Since November 2012, the First Claimant (the "Bank") has been pursuing proceedings to recover debts owed to it by the First, Second and Third Defendants ("the Al Sari Defendants"). In particular, it has been a judgment creditor of the Al Sari Defendants (and the Fourth and Fifth Defendants ("FAL" and "IGPL" respectively), being companies under their control) since March 2016 pursuant to the "Sharjah Judgment", in a sum exceeding £80 million. The Bank has enforced its judgment debt against the shares in the Second, Third and Fourth Claimants ("the BVI Companies"), being companies formerly owned by the Second and Third Defendants ("the Al Sari Brothers"). The BVI Companies own certain properties in London, including in particular the Al Sari family's London residence ("the Bridge Properties"). However, the Bank has been unable to realise any value from those properties by reason of a dishonest scheme, described in this judgment, to preserve the Bridge Properties (or their proceeds) for the benefit of the Al Sari family, in particular by two means:
(1) a sham "Tenancy Agreement" (with Addendum), which purported to grant a perpetual tenancy at an undervalue to the Sixth Defendant ("IGPL GT"), being an Al Sari company, as well as to certain Al Sari children; and
(2) the bringing into existence of the sham "Globe Documents", which purport to impose a debt of around £115 million on the BVI Companies in favour of the Seventh Defendant ("Globe").
- The purpose of the sham Tenancy Agreement was to allow the Al Sari family to remain in possession of the Bridge Properties. The Globe Documents were created in order to allow Globe to effect the return of the Bridge Properties (or their proceeds) from the BVI Companies to the ultimate benefit of the Al Sari family.
- From 17 April 2019, Globe pursued a claim in Sharjah, UAE against the BVI Companies based on the sham Globe Documents ("the Sharjah Globe Proceedings"). The Sharjah Court initially dismissed Globe's claim, holding that the Globe Documents were "fabricated". However, Globe succeeded on appeal (being "the First Globe Appeal Judgment") and the BVI Companies were ordered to pay Globe, pursuant to the terms of the sham Globe Documents, the sum of AED 582,652,815 together with interest at 5% from 17 April 2019. Subsequent appeals (including by way of Petitions for Reconsideration) by the BVI Companies and the Bank to the Sharjah Court of Appeal and the Federal Supreme Court were dismissed by those courts ("the Globe Appeal Judgments").
- This trial concerns the Claimants' claim for declaratory and injunctive relief in respect of the Globe Documents and First Globe Appeal Judgment (as described in paragraph 116 below). The Claimants invite the Court to make findings in three categories.
- First, that the Globe Documents were and are (i) shams, (ii) made without the BVI Companies' authority and (iii) void and of no effect. The Claimants also invite the Court to find that they were (iv) backdated and (v) created for the purpose of harming the Claimants. As will be seen, the Claimants established each of these matters at trial.
- Second, that the First Globe Appeal Judgment was obtained by fraud and should not be recognised or enforced at common law. The fraud on the Sharjah Court comprised the knowingly false assertions by Globe that the Globe Documents were genuine and valid documents entered into on the dates they bear, which record true and valid agreements between the parties to them. The Claimants also established this at trial.
- Third, that the Globe Appeal Judgments do not preclude the Bank or the BVI Companies from advancing that case in fraud ("the preclusion issue"). I find that they do not.
- As to the preclusion issue, the Claimants' case which I consider to be well founded (as discussed below) is in particular that: (i) the Second/Third Globe Appeal Judgments were not the product of a second, separate set of proceedings so as to engage the rule in House of Spring Gardens v Waite (No 2) [1991] 1 QB 241; (ii) the petitions under Article 169 of the UAE Civil Procedure Code were concerned with a far narrower inquiry than the Abouloff fraud issue before this Court; (iii) the BVI Companies were not parties to the Third Globe Appeal Judgment in any case, and are not bound by it whether as privies or otherwise; (iv) there is no concept of a Henderson v Henderson or Hunter abuse under UAE law, but neither would apply in any case; (v) the House of Spring Gardens principle is not engaged at all against the Bank, because it was not a party (or privy) to the First Globe Appeal Judgment (and accordingly its position is of no relevance to the declaratory relief sought by the Claimants).
PARTIES
- The First Claimant is the Commercial Bank of Dubai PSC, incorporated under the laws of the UAE, registered at Al Ittihad Street, PO Box 2668, Dubai. The Second to Fourth Claimants are Hortin Holdings Limited ("Hortin"), Westdene Investment Limited ("Westdene"), and Lodge Hill Limited ("Lodge Hill") (together, the BVI Companies). As mentioned, the BVI Companies were formerly ultimately beneficially owned by the Second and Third Defendants and are now owned by the Fifth Claimant, VS 1897 (Cayman) Limited ("VS 1897") which is a corporate nominee incorporated in the Cayman Islands and ultimately owned by the Bank.
- The First to Third Defendants are all members of the Al Sari family, Mr. Abdalla Juma Majid Al Sari ("Abdalla Al Sari"), Mr. Majid Abdalla Juma Al Sari ("Majid Al Sari"), and Mr. Mohamed Abdalla Juma Al Sari ("Mohamed Al Sari"). The Al Sari Defendants are Emirati nationals and the ultimate beneficial owners of an international group of companies with business interests in various industries including oil, investments, real estate development, manufacturing, retail, insurance and hospitality (the "Al Sari Group").
- By two orders of Henshaw J dated 20 May 2022 default judgment was entered on all claims in this action against Mohamed Al Sari, who has not participated in these proceedings at all.
- The Fourth Defendant, FAL, is a company incorporated in the UAE and was previously a large oil trading company in the Gulf. Abdalla Al Sari is its manager, and its shares are equally owned by IGPL Investments LLC (the shareholders of which are Majid Al Sari and IGPL) and Al Soor Investments LLC ("Al Soor"). The listed manager of Al Soor is Mohamed Al Sari and its shareholders are Abdalla Al Sari and Sari Investments LLC.
- IGPL is a company incorporated in the UAE. IGPL's manager is Abdalla Al Sari and his daughters are shareholders alongside the Al Sari Brothers.
- By order of Butcher J dated 10 May 2023, the Claimants entered summary judgment against Abdalla Al Sari, Majid Al Sari, FAL and IGPL on the Bank's claim to enforce the Sharjah Judgment. They were ordered to pay to it the sum of UAE 382,842,285.79 plus the sum of UAE 9,297.33 per day from 28 April 2023 to the date of payment on a joint and several basis.
- The Sixth Defendant, IGPL GT, is a company incorporated in UAE. Its manager is Abdalla Al Sari and his daughters are shareholders alongside Discovery Investment Group LLC ("Discovery"). Discovery is a company managed by Majid Al Sari and the children of Majid Al Sari are shareholders. At the relevant time, each of Majid Al Sari's children were minors.
- The Seventh Defendant is Globe which is a company incorporated in the Jebel Ali Free Zone Dubai, UAE.
- The Eighth Defendant is MENA Investment Holdings Limited ("MENA"), a company incorporated in the BVI. MENA is the sole shareholder of Globe and the parent company of both Globe and the Ninth Defendant, MAS Capital Holdings Limited ("MAS").
- MAS is a company incorporated in the Jebel Ali Free Zone Dubai, UAE. I shall refer to Globe, MENA and MAS in this judgment as "the Globe Defendants".
- The Tenth Defendant is Mr. Hamad Saif Hamad Abdalla Almheiri ("Mr. Almheiri"). He is the second cousin of Abdalla Al Sari, a director of the Globe Defendants, and a shareholder in MENA. His name appears as a signatory on the Globe Documents, the significance of which is explained below. Mr. Almheiri claims to be the controlling mind of MENA, which filed a defence to this claim together with Globe and MAS. Mr. Almheiri is recorded as having held various managerial positions within companies related to the Al Sari Defendants as I describe further below.
PROCEEDING IN THE ABSENCE OF THE DEFENDANTS?
- These proceedings have been ongoing since 2022. The Defendants' engagement with them has been sporadic (and in Mohamed Al Sari's case, non-existent) and they each chose not to attend this trial. I had accordingly first to decide whether to proceed with this trial in their absence. I decided that I should.
- As I have said, Mohamed Al Sari has never engaged with the proceedings. On 20 November 2023 he was committed to prison for 21 months by Butcher J for contempt of court (in his absence), as a result of his failure to comply with an asset disclosure order pursuant to a Worldwide Freezing Order made against him by Cockerill J on 18 February 2022 (as varied and continued by Calver J on 11 March 2022).
- The other two Al Sari Defendants, FAL, IGPL and IGPL GT ceased to be legally represented in these proceedings in February 2023 and they have had only limited engagement with them since that date. They did not attend the hearings where findings of contempt were made against the First to Sixth Defendants by Butcher J on 4 October 2023 and when Abdalla Al Sari and Majid Al Sari were each committed to prison for their contempt for 24 months by Butcher J on 20 November 2023.
- The limited engagement of Abdalla Al Sari and Majid Al Sari is as follows:
(1) Abdalla Al Sari and Majid Al Sari (instructing Janes Solicitors) applied to set aside the Contempt Order under CPR 39.3, on the basis that they were unaware of the hearing. Mr Justice Butcher dismissed that application, being in "no doubt that [Majid Al Sari's affidavit to that effect] contains deliberate falsehoods, seeks to give a wholly misleading impression", and there was no good reason for their failure to appear. Their appeal was dismissed, the Court of Appeal upholding the finding that they were aware of the hearing.
(2) Abdalla Al Sari re-engaged briefly (instructing Acuity Law) for the sole purpose of agreeing a document inspection protocol for documents found at the Bridge Properties in September and October 2023. Acuity Law was not instructed in respect of any other aspect of the case.
- The Globe Defendants filed a defence on 8 March 2024. At a pre-trial review MENA (the parent company of Globe and MAS) was ordered to give disclosure by 18 April 2025. It did not comply with that order and has not re-engaged with these proceedings subsequently.
- Globe, MAS, and Mr. Almheiri were represented at a hearing before this court in November 2024 after which the court indicated that there would be a hearing on 14 January 2025 where the form of a worldwide freezing order against Mr. Almheiri would be settled. However, the solicitors who represented Mr. Almheiri at the November 2024 hearing applied to come off the record on 3 January 2025. Mr. Almheiri did not participate in the 14 January 2025 hearing and did not give any asset disclosure. He has taken no steps to comply with his asset disclosure obligations, and the Claimants have issued a committal application for his contempt in respect of the worldwide freezing order. He has also failed to give disclosure in these proceedings.
- The Globe Defendants' supposed reasons for lack of engagement and non-attendance at trial were set out in a letter sent to the Claimants on 1 May 2025 by newly appointed lawyers in Dubai, OBH Lawyers ("OBH"). They objected to the English Court's jurisdiction and to service, and stated that Mr. Almheiri had filed a criminal complaint in the UAE "in relation to the substance of the ongoing UK proceedings". They also stated that "no action will be taken that may give rise to a potential criminal liability as an accessory to what may prima facie be considered as a UAE Criminal Offence". The Claimants responded the next day explaining that Mr. Almheiri's objections and criminal complaint were unfounded, and seeking confirmation as to whether the Seventh to Tenth Defendants would be attending the trial. The Claimants did not receive any response to that email.
- The Defendants were fully aware of the date and location of this trial and were served with all of the relevant documentary material. There have been six service orders made since the start of these proceedings which gave permission for the Defendants to be served by various alternative methods including by courier, iMessage, text message or WhatsApp, and email. The Defendants were each provided with access to the trial bundle and all written arguments of the Claimants.
- Pursuant to CPR 39.3, the court has a discretion to proceed with a trial in the absence of a party. When determining whether to do so, "[It] is of course of the first importance that a party is afforded a fair opportunity to present its case to the judge. It is also, however, of great importance that judges, as a matter of case management, act robustly to bring cases to a conclusion…": Williams v Hinton [2012] CP Rep 3 (CA), Gross LJ at [40].
- Dexia S.A. v Regione Emilia Romagna [2024] EWHC 3236 (Comm) provides guidance as to the exercise of the court's discretion in such a case. In that case, the defendants acknowledged the claim and indicated an intention to defend it at trial but subsequently decided not to participate at trial. The claimant made the electronic trial bundle available to the defendants. The court stated at [20]:
"The right to be present at trial and to be legally represented can be waived by a defendant. One circumstance in which this right may be wholly waived is if, "knowing, or having the means of knowledge as to, when and where his trial is to take place, he deliberately and voluntarily absents himself and/or withdraws instructions from those representing him" (R v Jones quoted in Caranzaro at [3])".
- Further, in Sloutsker v Romanova [2015] EMLR 27 at [25] it was stated:
"Where a litigant fails to appear without giving a reason it is necessary to consider first whether they have had proper notice of the hearing date and the matters, including the evidence, to be considered at the hearing. If satisfied that such notice has been given, the court must examine the available evidence as to the reasons why the litigant has not appeared, to see if this provides a ground for adjourning the hearing".
- In the present case, all of the relevant evidence, orders and notice of the trial date have been served on each of the Defendants by the permitted alternative means, and were received by them, as set out in detail in the 22nd witness statement of Mr. Sion Richards dated 3 May 2025 (as updated in his 23rd witness statement dated 6 May 2025). Indeed, Globe, MAS and Mr. Almheiri were aware of the Claimants' proposal to use the trial window for the claims in this trial, which proposal was made while they were still legally represented. Mr. Almheiri (who claims to control the Seventh to Ninth Defendants) is clearly aware of the trial, and in light of OBH's emails has clearly taken a deliberate decision not to attend the trial.
- In short, I am satisfied that each of the Defendants is aware of the trial and has access to all the relevant trial evidence and documents, but has chosen voluntarily to disengage from the proceedings. They have accordingly waived their right to attend the trial. There is no reason not to proceed in their absence.
- Moreover, in the light of the Defendants' non-attendance, I granted the Claimants permission to dispense with oral evidence at trial and instead to prove their case on the basis of their pleadings, written witness statements, expert reports and the disclosed documents pursuant to CPR 32.2(2)(b) and 32.5(1)(b), in accordance with the guidance in Lighting and Lamps UK Ltd v Clarke [2016] EWCA Civ 5 at [41]-[42]. That guidance was followed by Foxton J in Lakatamia Shipping v Tseng [2023] EWHC 3023 (Comm) at [11]-[12] when he stated as follows:
"As a matter of principle, the court is perfectly entitled to dispense with the calling of oral evidence under CPR Parts 32.2(2)(b) and 32.5(1)(b) where witness statements have been served. The court does not have to follow a pointless procedure in an undefended claim. If it were otherwise, undefended cases up and down the country would be delayed and subjected to inappropriate scrutiny when there was no defence raised and no substantive argument about the claimants' entitlement.
In this case the claimants had to prove their case. They did so by presenting both their statement of case verified by a statement of truth, and also their witness statements. There was no need for the judge to require the witnesses to be called."
- I have also applied the approach summarised in Nitron Group BV v Barington Alliance LLP [2020] EWHC 1244 (Comm) at [13], followed recently in AMNS Middle East v LIQS Pte Ltd [2025] EWHC 150 (Comm) at [36]:
"… if the Defendants choose not to participate in the trial, the Court is not in a position to conduct a cross-examination of the witnesses by reference to the contemporaneous documents, and its ability to test the evidence is heavily constrained. Unless the witness statement is internally inconsistent or manifestly incredible on its face, the Court can only consider whether the evidence adduced is sufficient to make out the claimant's case, on the basis of that evidence and the inferences which can properly be drawn from it."
- So far as the factual evidence is concerned, at the pre-trial review the Court directed that unless Globe or MAS attended the trial and called Mr. Almheiri to give evidence, Mr. Almheiri's trial witness statement would not be admitted into evidence at trial. Accordingly, I did not admit it into evidence.
- As for expert evidence of UAE law, on 28 February 2024 permission was granted to the parties by Dias J to rely on expert evidence of UAE law relevant to the House of Spring Gardens/preclusion issue. The Defendants have elected not to serve any such expert evidence, so the only evidence of UAE law before the Court is that of Mr Ramadan, the Claimants' expert. I bear in mind that the court should be reluctant to reject uncontested expert evidence unless it is "obviously false, obscure, extravagant … or patently absurd, or if he has never applied his mind to the real point of law, or if the matters stated by [the expert] did not support his conclusion according to any stated or implied process of reasoning; or if the relevant foreign court would not employ the reasoning of the expert even if it agreed with the conclusion … [or] if it is inconsistent with the text or the English translation [of a foreign statute] and not justified by reference to any special rule of construction of the foreign law": R v Lama [2017] QB 1171 (CA) at [106]-[107].
- In fact, I found Mr. Ramadan's evidence to be clear, balanced and persuasive, and I accept it.
- Dias J also granted permission to rely on expert evidence of "Emirati business culture, including the existence and nature of name lending and practice of Emirati businessmen being appointed to the boards of other Emirati businesses." Globe and MAS served an expert report by Mohammed Al Dahbashi on 13 December 2024 before they disengaged with the proceedings. Mr. Al Dahbashi's expertise in this area is, however, questionable as I explain below. In contrast, the Claimants served in response a persuasive expert report dated 24 January 2025 from Mr. Binherz, a UAE lawyer who has 33 years' experience in the banking sector. In so far as there was a difference of opinion between Mr. Al Dahbashi and Mr. Binherz on any issue of substance, I preferred the evidence of Mr. Binherz.
- Mr. Al Dahbashi indicated on 30 January 2025 that he had been without instructions since his report was served. There has therefore been no experts' meeting or joint memorandum. Mr. Al Dahbashi did not attend trial to give evidence. However, the report of an expert served with permission remains part of the evidence in the case, albeit the weight attributed to it is naturally affected by the fact that the expert is not available for cross-examination: Leeson v McPherson [2024] 4 WLR 41 at [14]-[16], [20] and [27]. The Claimants accordingly addressed Mr. Al Dahbashi's expert report insofar as it was necessary for them to do so in submissions at trial.
- Finally on this topic, the Claimants' counsel, Andrew Trotter and Madelaine Clifford, readily accepted that because the Defendants did not attend trial, the Claimants had an obligation of fair presentation. That obligation is "less extensive than the duty of full and frank disclosure on a without notice application", but involves drawing to the attention of the court "points, factual or legal, that might be to the benefit of [the defendant]": CMOC Sales & Marketing Ltd v Persons Unknown [2018] EWHC 2230 (Comm) at [14]. Accordingly, where the Defendants have filed a defence, it is appropriate for the Claimants to address relevant points which are raised within it.
- I consider that Mr. Trotter and Ms. Clifford complied fully with this obligation. Indeed, they were scrupulous throughout the trial in drawing the court's attention to any point which might be made in favour of the Defendants and their trial presentation was thorough, fair and extremely impressive, and the court is grateful to them both.
FINDINGS OF FACT
- The factual background to this claim ranges over proceedings in Sharjah and the DIFC in the UAE, the BVI, and England. I summarise my findings of fact next.
The Sharjah Proceedings
- Between 2002 and 2010, the Bank extended credit to FAL with the Al Sari Defendants and IGPL acting as guarantors. FAL got into financial difficulties such that in 2013 it was reported by Reuters that FAL owed a consortium of lenders around $900 million and that the net worth of FAL had fallen from $3 billion to just over $300 million by that date.
- On 18 November 2012, the Bank obtained a precautionary attachment against various assets of FAL, IGPL and the Al Sari Defendants in the UAE.
- Having secured the assets, on 25 November 2012 the Bank commenced proceedings against FAL, IGPL and the Al Sari Defendants in Sharjah for AED 472,676,345 owed pursuant to the various facilities and personal guarantees granted to them ("the Sharjah Proceedings").
- On 17 November 2014, the English Court granted a freezing order pursuant to s. 25 of the Civil Jurisdiction and Judgments Act 1982 in support of the Sharjah Proceedings against the Al Sari Defendants and the BVI Companies in respect of assets in England and Wales up to AED 430,000,000 ("the s.25 Freezing Order").
- On 18 November 2014, a freezing order mirroring the s.25 Freezing Order was granted in the BVI ("the BVI Freezing Order") which also restrained the BVI Companies from dealing with or diminishing the value of the Bridge Properties.
- As a result of the freezing orders, the Al Sari Defendants became aware that both the Bridge Properties and the BVI Companies were the target of enforcement action by the Bank and that any dealing in these properties risked being a breach of the s.25 Freezing Order or the BVI Freezing Order.
- On 29 March 2016, the Sharjah Court of First Instance entered judgment for the Bank against the Al Sari Defendants, FAL and IGPL (the "Sharjah Defendants") in the amount of AED 433,831,166.81[1] plus interest of 1% on that amount from 4 December 2012 (the "Sharjah Judgment"). On 27 February 2017, the Sharjah Defendants' appeal was dismissed by the Sharjah Federal Court of Appeal.
- Thereafter, the Al Sari Defendants consistently resisted the Bank's attempts to enforce the Sharjah Judgment.
- On 29 June 2017, the Bank commenced proceedings in the BVI against the Al Sari Defendants in order to enforce the Sharjah Judgment. The Al Sari Defendants then began to take steps to delay enforcement against the BVI Companies, in order to protect the Bridge Properties.
- The BVI Court granted permission to serve Majid and Mohamed Al Sari out of the jurisdiction. Mohamed Al Sari was, at that time, in Sharjah's Central Prison and the Bank endeavoured to effect personal service upon him but he refused to receive the documents. The Bank attempted to serve Majid Al Sari on several occasions. On the first occasion his secretary refused to accept receipt of the documents. On a second occasion, the Bank attempted to serve him at his office at Horizon Energy LLC in Sharjah but he again refused to accept service.
- Neither Majid nor Mohamed Al Sari defended the BVI proceedings and summary judgment was entered against them. The judgment was served on them, and on 13 September 2018 the Bank obtained a provisional charging order over, and an order for the sale of, the shares in the BVI Companies, which it served on Majid and Mohamed Al Sari on 26 September 2018.
- At that stage, Majid Al Sari sought to set aside the summary judgment with a spurious argument that he had not been properly served, and that the Bank had breached an undertaking in the s.25 Freezing Order. On 25 October 2018, that application was refused by Justice Adderley on the basis that it was unsupported by evidence and indeed "contrary to the order on its face." It is clear that Majid Al Sari was very keen to seek to hold on to the valuable Bridge Properties, come what may.
- On 19 February 2019, despite Majid Al Sari's attempts to resist it, the BVI Court granted a final charging order and order for sale ("the Final Charging Order"). A Receiver was appointed to the BVI Companies for the shares to be sold and their proceeds applied toward the Judgment Debt.
- The Al Sari Defendants' keenness to avoid the Bridge Properties being the subject of enforcement action is also illustrated by the fact that, after the Final Charging Order was made, Abdalla Al Sari visited the Bank and met its Chairman in or around March 2019. At this meeting Abdalla Al Sari "begged the bank not to enforce on the Bridge Properties" and "threatened that he would not let the Bank get its hands on the Bridge Properties easily": Tayeb w/s 1 [11].
- Further delay was occasioned by the fact that on 2 April 2019, Majid Al Sari sought to appeal the Final Charging Order on jurisdictional grounds and sought a stay of it pending the determination of his appeal. On 13 May 2019, the application for a stay was refused. Despite Majid Al Sari confirming on 27 June 2019 that he was maintaining his appeal and would be filing his submissions, in fact no appeal bundle or skeleton was ever filed by him: Richards w/s 1 [75]. Dr. Tayeb states in paragraph [9] of his first witness statement that although this appeal was accordingly ultimately dismissed by the Court, "it meant that the Receiver could not press ahead with the sale of the shares in the BVI Companies until 2021".
The Globe Documents
- The Sharjah Proceedings and the Bank's associated attempts to enforce the Sharjah Judgment provide the reason for the fraudulent scheme which was developed thereafter by the Defendants. The first element of the fraudulent scheme consisted of the creation and backdating of the Globe Documents, being three agreements recording a series of transactions said to have resulted in the BVI Companies being indebted to Globe in the amount of AED 582,652,815 (plus interest)[2]. All of the Globe Documents were signed by Abdalla Al Sari for the BVI Companies; and the Globe Defendants plead that Majid Al Sari and Mr. Almheiri negotiated them.
- It is significant that the existence of the Globe Documents only emerged for the first time when Globe brought a debt claim against the BVI Companies in Sharjah on 17 April 2019, despite two of the documents supposedly being dated in 2014. The Claimants' case was that the Globe Documents are false, backdated and/or sham documents; alternatively, that even if genuine they were created in order to harm the Bank and the BVI Companies.
- The Globe Documents consist of the following:
60.1. A Memorandum of Understanding dated 13 April 2014 between the Al Sari Brothers, Globe, MAS and the BVI Companies ("Globe MOU"). Clause 2 of this document purports to record an agreement that MAS would repay debts owed by the Al Sari Brothers to various banks in the amount of AED 651 million[3]. By clause 3, the Al Sari Brothers purportedly agreed to repay to MAS a discounted sum of AED 550 million[4]. By clause 7, the Al Sari Brothers' repayment obligation would purportedly be transferred to the BVI Companies; and then by clause 8, MAS would purportedly assign its right to be repaid to Globe. Finally, clause 9 then purportedly operated to release the Al Sari Brothers from liability to MAS. Thus, the BVI Companies would end up with a repayment obligation (for AED 550m) to Globe and the Al Sari Brothers would escape liability altogether for their debts (of AED 651m) to the banks.
60.2. A loan agreement dated 14 April 2014 ("the Globe Loan Agreement") by which the BVI Companies purported to declare their alleged debt to Globe of AED 550m with interest of 1% payable between April 2015 and September 2018. It is important to appreciate that the only assets of the BVI Companies at this time were the Bridge Properties which had a value of around £9 million. Therefore, the effect of the Loan Agreement would inevitably be to render the BVI Companies entirely insolvent.
60.3. A settlement agreement dated 1 November 2018 between Globe and the BVI Companies ("Globe Settlement Agreement") pursuant to which, having purportedly defaulted under the Globe Loan Agreement, the BVI Companies purportedly agreed to pay Globe AED 582,652,815 in ten quarterly instalments between January 2019 to April 2021 (an increase of c. 1.4%).
- I have no hesitation in concluding that the Globe Documents are not genuine. They are highly uncommercial transactions solely for the benefit of the Al Sari Brothers. No explanation for the highly uncommercial features of these documents has been given by the Globe Defendants or Mr. Almheiri. Indeed, if they were genuine, the BVI Companies would have been rendered worthless and it would have made no sense, in those circumstances, for Majid Al Sari and Abdalla Al Sari to have been desperate to ensure (as can be seen to have been the case) that the Bank did not enforce its judgment against the shares in the BVI Companies.
- The obviously uncommercial features of the Globe Documents, in summary, are as follows.
- First, the machinery essentially operates to absolve the Al Sari Brothers personally of their debts and set up a repayment plan which would substantially underpay the lender. There is no plausible explanation as to why MAS, a supposedly arm's length third party, would assume and pay off AED 651 million worth of the Al Sari Brothers' debt (and that is so even if, as the Globe Defendants plead, it "ended up paying just AED 152,905,879 out of pocket to lenders in respect of the loans"). The explanation given by the MOU itself (and given in the Globe Defendants' Amended Defence) is that "[MAS] has cash liquidity sufficient to pay the debts … and it also has technical ability to negotiate with the banks." But that is contradicted by the evidence of Mr. Almheiri himself. He states that MAS is a modest operation without major assets or physical offices. Moreover, Mr. Almheiri also states that "[I]n no cases did I negotiate directly with the banks". Indeed MAS' Memorandum of Association (paragraph 4.2(c)) prohibited it from engaging in banking business. This explanation is wholly unconvincing.
- Second, there was no legitimate reason for MAS or Globe to agree to be repaid such large sums (550m or 582m AED[5]) by the BVI Companies rather than the Al Sari Brothers in accordance with the Globe MOU. It made no commercial sense at all: MAS had no major assets and the BVI Companies' only assets were the Bridge Properties, worth only about £9 million.[6]
- Third, the Globe MOU states that "in view of social considerations appreciated by the other parties to this agreement, [the Al Sari Brothers did] not wish to appear as a debtor" to Globe or MAS. In his affidavit sworn in support of a freezing injunction against the BVI Companies in the DIFC Court on 12 June 2023, Mr. Almheiri states at [84.8]: "the social considerations referred to is just the cultural mentality of a business man not wanting to be associated with his failed business. This would look badly on the families of the individuals involved and its very normal in our culture to distance ourselves from anything purportedly negative". However, in paragraph 12.1.1 of the Globe Defendants' Further Information served on 31 January 2024, they state that "a desire on the part of the Al Sari Brothers to conceal their connection to Globe or MAS would not amount to a social consideration." The Defendants have been unable to articulate the nature of these alleged social considerations and I find that they are a spurious excuse designed to conceal the true reason, which is to saddle the BVI Companies with debt.
- Fourth, in an attempt to get around the uncommerciality of these transactions, Globe relies upon an assertion that the BVI Companies were owed unspecified and unquantified debts by third parties. In particular, Globe says Majid Al Sari told Mr. Almheiri "in general terms" that the BVI Companies were owed such debts but without offering any further explanation. However, there is no evidence before the court to support this assertion and I reject it.
- Fifth, the Globe Documents are also highly uncommercial because Globe did no due diligence as to the asset position of the BVI Companies and took no security from them. Globe's excuse for this is to rely upon "a concept known as name lending".[7] Globe maintains that this allowed it to trust the "family name of the Al Saris" as security for the transaction. This is highly implausible. The existence of any such practice of "name lending" could not sensibly justify Globe accepting repayment from the Al Sari Brothers' offshore vehicles, given that the very transaction under the Globe MOU was premised on the Al Sari Brothers being unable to repay their creditors the sum of c. £121m. Moreover, if Mr. Almheiri was, as is alleged in the Globe Defendants' Amended Defence, only involved in arms-length, commercial business dealings with the Al Sari Defendants, there could be no rational basis for his taking such a significant commercial risk.
- The Globe Defendants adduced expert evidence from Mr. Al Dahbashi to the effect that it would have been common in 2012-2014 to rely on the name and business reputation of transaction counterparts. However, he was unavailable for cross-examination and his evidence is purely anecdotal. It is not supported by any illustrations of this supposed practice or legal authority. The Claimants relied upon the expert report of Mr. Binherz. He explains (at [4.1]-[4.3]) that "name lending" was a practice involving lending against personal guarantees (rather than reputations). It involved some basic level of asset verification but was considered to be a flawed practice even at the time, and largely fell away after the financial crisis in 2008 (and accordingly long before the supposed execution of the Globe MOU in 2014). As a result he considers that the Globe MOU "defies both banking and lending norms, and rational commercial behaviour at the relevant time." I agree and I accept Mr. Binherz's evidence.
- I would add that it is not clear on what basis Mr. Al Dahbashi is said to be an expert at all in Emirati business practices. His CV lists his business experience as being an "active investor" in the food and beverage industry, but sources (including his own LinkedIn page) highlight only one modestly sized restaurant with which he has a business involvement. It is also of concern that Mr. Al Dahbashi currently runs a firm based in Dubai called Al Dahbashi Gray, alongside a former English solicitor, Mr. Gray, who was struck off by the SRA in 2021 for deliberately misleading a court and taking steps to conceal his dishonesty.
- Mr. Binherz, in contrast, has an impressive CV and has considerable experience in the banking industry in the UAE.
- Sixth, there was in any case no legitimate reason to transfer the right to repayment from MAS to Globe, in circumstances where Globe has no bank account of its own and would use MAS's bank account to receive funds when needed; no consideration was given by Globe for the transaction; and both companies are owned by MENA. The true purpose was, I find, to conceal MAS's involvement in the transaction as a whole. I agree with Mr. Trotter that the explanations given by the Globe Defendants and Mr. Almheiri make no sense at all.[8] It is also notable that the Globe Loan Agreement makes no provision for what is to happen if MAS only repays part of the debts.
- Seventh, the Defendants have also sought to rely on alleged "Globe Performance Documents" as purportedly evidencing the contemporaneous performance of the transaction recorded in the Globe Documents. In fact, and perhaps unsurprisingly, they only serve to show that the transaction under the Globe MOU and the Globe Loan Agreement did not take place. The very premise for the Globe MOU was that MAS would repay the Al Saris Brothers' debts, and in return the Al Sari Brothers would repay (or ultimately cause the BVI Companies to repay) Globe. However, Mr. Trotter established at trial, as summarised in section 4 of his Closing Note, that the Globe Performance Documents demonstrate that MAS did not repay any of the underlying debts, and most of the underlying debts said to have been owed to various banks by the Al Sari Brothers were not in fact owed by them: see for example the series of debts totalling c.AED 350 million, owed under 2007 and 2008 syndicated facility agreements.
- Eighth, before the DIFC Court, Mr. Almheiri gave an entirely different explanation for the transaction in his third affidavit dated 12 June 2023 at [70]. He said that MAS intended to acquire the underlying debts and later "attempt to sell [them] at a higher price". But that is inconsistent with the Globe MOU and with the explanation which has been given in these proceedings that the debts were repaid. It is, as Mr. Trotter points out, also unsupported by any evidence of such attempted resales, and commercially illogical, since there is no reason to think that MAS would be in a better position than the banks to sell the distressed debts.
- Ninth and last, as with the Tenancy Agreement, Abdalla Al Sari did not have authority to enter into the Globe Documents on behalf of the BVI Companies. He was not a director or shareholder of the BVI Companies[9]. I find that Globe, and in particular the Al Sari Defendants and Mr. Almheiri, must have known this fact. No party has ever alleged that Abdalla Al Sari was authorised by the BVI Companies' directors to sign the Globe MOU, nor that the BVI Companies' corporate directors were even aware of the Globe Documents. The Globe Defendants have sought in the past to rely upon a Power of Attorney supposedly given by the Al Sari Brothers to Abdalla Al Sari, but since they did not have any authority themselves, they cannot bestow it upon him. Nor does the fact that they are beneficial owners of the BVI Companies advance their argument. As the DIFC Court stated in the Second DIFC Tenancy Proceedings, "To say that [Abdalla Al Sari] signed on behalf of Mohammed and Majid in their capacity as beneficial shareholders does not work, because signing is not something for them in general meetings of the [BVI Companies]". It follows that while Abdalla Al Sari signed the Globe Documents on behalf of the BVI Companies, he had no authority to do so. The BVI Companies therefore never entered into the Globe Documents, and they did not create any binding debt.
- In all the circumstances, I find as a fact that the Globe Documents are not genuine; they were created after the date which they purport to bear and were backdated. They are shams, that is, these documents were executed intending to give third parties and the court "the appearance of creating between the parties legal rights and obligations different from the actual legal rights and obligations (if any) which the parties intend to create": Snook v London & West Riding Investments Ltd [1967] 2 QB 786 at 802 per Diplock LJ.
- Finally, this conclusion is further supported by the fact that the Al Sari Defendants did not disclose the Globe Documents in November/December 2014 in their asset disclosure pursuant to the s.25 Freezing Order and the BVI Freezing Order granted in November 2014 by Leggatt J (England) and Bannister J (BVI) respectively.
The Sham Tenancy Agreement
- As described above, from 2017 onwards the Al Sari Defendants took numerous steps to delay or prevent the Bank from enforcing the Sharjah Judgment against the BVI Companies. They sought to evade service, belatedly applied to set aside summary judgment; resisted the granting of the Final Charging Order; sought to stay the Final Charging Order appointing the Receiver based on want of jurisdiction and then again on the basis of what they said was fresh evidence which was later found to be "corrupt"; and pursued an appeal for which they ultimately failed to file any skeleton argument.
- Once these attempts to derail the Bank's enforcement efforts were exhausted, and following the appointment of the Receiver in February 2019, the Al Sari Defendants' next tactic was to deploy false and backdated tenancy agreements concerning the Bridge Properties.
- The Tenancy Agreement dated 16 January 2013 and its "Addendum" dated 4 March 2013 purport to grant a perpetual tenancy of the Bridge Properties to several Al Sari children and IGPL GT (which before the DIFC Court of Appeal in March 2022 described itself as a "proxy" for the Al Sari family)[10]. Abdalla Al Sari (as with the Globe Documents) signed the Tenancy Agreement on behalf of all parties, and Mr. Almheiri held an office at IGPL GT at the time when the document was created. This was, I find, a further step in the Defendants' coordinated effort to keep control of the Bridge Properties for the benefit of the Al Sari family.
- The Tenancy Agreement emerged for the first time on 27 June 2019 (shortly after the sham Globe Documents were produced in April 2019) in a letter to the Receiver from Majid Al Sari. It records the landlords of the Bridge Properties as the BVI Companies, but it is signed by Abdalla Al Sari rather than by any corporate directors of the BVI Companies. Once again, Abdalla Al Sari had no authority to create, enter into, or sign any such document on behalf of the BVI Companies. No explanation has been forthcoming as to why he is the signatory rather than a corporate director of the BVI Companies. The Tenancy Agreement (with its Addendum) purports to grant a perpetual tenancy to IGPL GT and several Al Sari family members, all of which were children aged between 3 and 8 years of age at the relevant time.
- The Tenancy Agreement has been considered by an English court on a previous occasion and found not to be genuine. Thus, in a judgment given by HH Judge Johns KC in possession proceedings brought in the Central London County Court on 28 April 2023, the Judge found, in relation to the Tenancy Agreement: "it can already be seen on the evidence that the written agreement [the Tenancy Agreement], central to the arrangement alleged, is a fabrication".
- Like the Globe Documents, I find as a fact that the Tenancy Agreement and Addendum are sham documents, being backdated, fabricated documents:
82.1. There is no documentary record (other than the document itself) of the Tenancy Agreement existing/coming into existence prior to 2019, despite it being dated 16 January 2013 (with the Addendum dated 4 March 2013).
82.2. Most tellingly, the postcode is backdated. The postcode of the Bridge Properties, which appears in the Tenancy Agreement dated 16 January 2013, is SW11 8NP. However, this postcode was not ascribed to the Bridge Properties until 2016, as evidenced by a letter from Royal Mail dated 10 November 2016, which fortunately was retained by a resident property management company, Bridge RTM Company. An email communication from Royal Mail sent to occupiers was shared with Dr. Tayeb on 26 March 2022 which officially confirmed that the "SW11 8NP postcode was not created or assigned to these properties until 10th November 2016. Had the agreement been executed in 2013 as claimed, whoever drafted it could not have known of the planned ... change ...".
82.3. The individual tenants (B-H) under the Tenancy Agreement were all minor children at the material time, being between 3-8 years old. The Bridge Properties comprise both commercial and residential units owned by the BVI Companies. There is obviously no reason why minor children would lease commercial premises. Nor is there any legitimate reason for the Tenancy Agreement to be for a perpetually renewable term to infant children, or for them to have a right to assign it as they see fit. Nor is there any legitimate reason why the tenants should be able to set off all income and expenses in relation to the properties against future rent (see clauses 1-4).
82.4. Moreover, the Tenancy Agreement purports to let the commercial units, despite the fact that they had already been let to third parties. In the Tenancy Agreement, the leasehold of the commercial suites is owned by Westdene Investment Limited. However, from 26 May 2006 onwards, it is apparent from an Underlease that at least one of the commercial suites (Suite 3) was leased to HCA International Limited (HCA), a healthcare provider. That lease was for a term of 10 years, and in 2016 HCA took an underlease of another of the commercial suites (Suite 2) for a further 10 years which had previously been let to Horizon Energy Group (UK) Limited.
82.5. According to clause 5 of the Tenancy Agreement, the rent due for the Bridge Properties is £850,000 for the first full 15-year term. This is a substantial undervalue. That is clear from the fact that the rent paid by HCA when taking the 10 year underlease on 12 October 2016 of suites 2 and 3 was £190,000 per annum (after the first year). Moreover, in 2019 the Bridge Properties were valued by Lambert Smith Hampton at £5 million, such that the market value of the rent would have been well in excess of £4,722 per month.
82.6. No rent was in fact ever paid to the BVI Companies. IGPL GT alleged that two payments made around January 2013 which total £850,000 represented the payment of rent. However, the first payment was made in 2012 to Mohamed Al Sari, not being a BVI corporate director, and the second came from Hortin in January 2013 but was returned in full less than two weeks after payment. Neither of these payments were made to the BVI Companies. The payments also do not align with IGPL GT's claim (in proceedings brought by them in the DIFC for specific performance of the Tenancy Agreement) that the payments were made to discharge loans taken out by the BVI Companies from Coutts Bank in January 2013: the documentary evidence shows that those loans were only discharged six months later in June 2013.
82.7. The Tenancy Agreement records at clause 9 that the BVI Companies were responsible for registering the agreement with the local authorities. There is no record of the Tenancy Agreement ever having been so registered, and the first time there is a reference to it is in June 2019. The BVI Companies knew nothing of it until then; the Al Sari Defendants' property manager, Mr. Colquhoun-Denvers, had never seen it and was not aware of it; there is no record of it in the BVI Companies' documentary records handed to the Receiver; and the Al Sari Defendants made no mention of it in their evidence in response to the freezing orders granted against them in 2014.
- In the circumstances, I have no doubt, and I find as a fact that the Tenancy Agreement is fabricated; it is a sham document. It was backdated, being created in a further attempt to preserve the Bridge Properties for the benefit of the Al Sari Defendants and family.
- The reason, no doubt, that these documents required to be backdated prior to November 2014 was because it was in November 2014 that (i) Leggatt J granted the s.25 Freezing Order against the BVI Companies (and the Al Sari Defendants) and (ii) Bannister J granted equivalent relief against the BVI Companies in the BVI. Any dealings in the Bridge Properties prior to these dates would fall foul of the court orders.
- In the same way, the Globe Documents were created around the time of the appointment of the Receiver in February 2019[11], with the Globe MOU and the Globe Loan Agreement being backdated so as to give the impression that they were created before the Bank began taking enforcement steps in November 2014. The similarities are striking. There was no record of any of these two sets of documents (i.e. the Tenancy Agreement and Addendum on the one hand, and the Globe Documents on the other) prior to 2019; they were not witnessed or notarised; and the Defendants conveniently (for them) state that any individuals who would be expected to have had knowledge of these documents had left the relevant company and were unavailable. That means:
(i) as regards the Tenancy Agreement, Mr. Abdul Kareem and Dr. Osama Nashef, who are said to have left the company in 2018-19 and 2014-15 respectively; and
(ii) as regards the Globe Documents, in particular Mr. Eldose Mathai, a contractor for MAS (who was the only person who did anything on its behalf) and who held a position at FAL, and Mr. Rashid Saif, Globe's lawyer.
- It was also open, of course, to any of the Al Sari Defendants to give disclosure of relevant documents or serve a witness statement attesting to the genuineness of these documents. Their silence is deafening.
The Al Sari Defendants were in control of Globe, MAS and IGPL GT; Mr. Almheiri was a front for them
- I find as a fact that the Al Sari Brothers owned and controlled Globe and MAS at all material times, including, in particular, at the time when the Globe Documents were fabricated. I also find as a fact that Mr. Almheiri is merely a front for them. The transaction to which the Globe Documents give effect benefits only the Al Sari Brothers whose debts were paid off by a third party, and it only makes sense if MAS, said to have paid out very substantial sums of money which it will never recover, was a vehicle of the Al Sari Brothers[12]. The backdated Globe Documents were a scheme to ring-fence the assets of the BVI Companies. Unless the Al Sari Brothers were in control of Globe, this would be a wholly uncommercial transaction.
- In fact, Globe has admitted that it was owned by the Al Sari Brothers. In (i) its Appellant's Memorandum of 3 August 2020 and (ii) its Appellant's Memorandum of 18 August 2020 and its submission on appeal in the First Globe Appeal (discussed below) it states respectively:
"Muhammad Abdullah al-Sari and Mr. Majid Abdulla al-Sari (third party in the memorandum of understanding) own multiple companies including the Appellant [Globe], the Second Party in the MOU and other companies"; and
We would like to draw the kind attention of the court that Mr. Mohammed Abdulla Juma Al Saro and Mr. Majid Abdulla Al Sari (third party in the memorandum of understanding) own multiple companies including the Appellant, the Second Party in the MOU and other companies."
- Globe's lawyers have suggested that this was a mistake. I reject that suggestion: the statements are repeated, clear and unequivocal.
- It has never been contested that IGPL GT is controlled by the Al Sari Defendants. IGPL GT was at one point represented by CRS, together with Abdalla and Majid Al Sari in these proceedings. Mr. Almheiri was the General Manager of IGPL GT between 2016-2018 according to company documents. The Globe Defendants have not denied that he continued so to act in 2022 and the documents also show that he continued to act as its "representative" between 2017-2022. I reject the suggestion that he ceased to act on behalf of IGPL GT in 2017 and I find as a fact that he remained its manager during the DIFC Tenancy Proceedings and the Sharjah Tenancy Proceedings, referred to below.
- The closeness between Mr. Almheiri, the Al Sari Defendants and their companies is illustrated by the fact that in June 2013, when an enquiry was made by Mr. Colquhoun-Denvers as to the private home address for Mr. Almheiri, he was told that it is Villa No. 7, Street No. 9, Al Layyah, PO Box 3755, Sharjah UAE. That is the very same PO Box address used by Majid Al Sari, Mohamed Al Sari, IGPL and IGPL GT. Moreover, MAS and Globe have UK email addresses even though Mr. Almheiri, who claims to be the individual behind them, has no connection with England at all.
- I reject Globe's attempts to explain away the close connections between it and the Al Sari Brothers / Mr. Almheiri and the suggestion that Mr. Almheiri and the Al Sari Defendants are all independent businessmen in their own right. Both Globe and Mr. Almheiri have failed to give disclosure to support this assertion, despite being ordered to do so.
Adverse inferences: lack of witness evidence and disclosure
- The Court may draw adverse inferences where a party declines to call any evidence at trial without proper explanation, in relation to matters within his knowledge and about which he could be expected to give evidence. Similarly, an inference can be drawn where a party declines to call a particular witness who could be expected to give relevant evidence, without proper explanation.[13]
- Whether to draw adverse inferences in a particular case is to be assessed as a matter of common sense rather than by reference to strict legal rules.[14] The appropriate inference is that the evidence would not have assisted the party's case.[15] Its effect is that "a prima facie case may become a strong or even an overwhelming case",[16] or to "strengthen the evidence adduced by the party seeking the inference or weaken the evidence adduced by the party resisting it".[17]
- The Court may similarly draw adverse inferences where a party fails to give disclosure of particular documents.[18] Further, where the Court finds that a litigant has destroyed or suppressed relevant documents, the strongest possible presumption arises that the documents would have told against the destroyer, and the court should refuse to give the destroyer the benefit of any doubt or draw any inference in its favour.[19] The same applies where there is a "deliberate void" of evidence.[20]
- Abdalla Al Sari signed the Globe Documents, and Majid Al Sari and Mr. Almheiri are alleged to have negotiated them.[21] Abdalla Al Sari similarly signed the Tenancy Agreement on behalf of all parties. Each of these individuals could obviously have given highly material evidence about the circumstances of the creation of these documents and, if they were genuine, have sought to explain that that was so. However, they have not done so. Globe and MAS indicated they would call Majid Al Sari in their Case Management Information Sheet, but did not serve any statement from him, without any explanation. Mr. Almheiri served an inadequate witness statement, but then disengaged with the proceedings and did not give evidence at trial. The Claimants invite me to infer that that is because he knows his evidence is false and would not be believed. I agree that that is the appropriate inference to draw.
- Furthermore, the Al Sari Defendants and IGPL GT have failed to give any disclosure in these proceedings. The disclosure given by Globe and MAS is plainly inadequate. In particular, no documents have been disclosed by the Defendants themselves, or by them from any third party, which concern the coming into existence of the Globe Documents or the Tenancy Agreement (with Addendum) so as to verify them. In correspondence, Globe and MAS asserted that much of the relevant email correspondence is "likely to have been automatically deleted" but at no stage did it explain how this 'automatic' deletion is supposed to have occurred, its extent or the steps taken (if any) to recover the correspondence. Moreover, they stated that relevant emails would have been captured in hard copy by a "uniformly followed" policy of printing and storing correspondence in hard copy. However, it later transpired that the hard copy documents were only stored up to the beginning of 2017 and far from the process being "uniformly followed", "[n]ot every email was printed, and some print outs were destroyed" (see Mr. Almheiri's second witness statement at [47]).
- The Globe Defendants also stated that Mr. Almheiri had lost all data from his old laptops, which he had either thrown or given away. Mr. Almheiri also excluded his personal mobile phone and laptop from Globe and MAS's disclosure, despite his own evidence before the DIFC Court that he communicated with Majid Al Sari by phone, and Globe and MAS's confirmation in their DRD that he used his laptop for "all work relating to the D7 and D9". He then failed to give disclosure himself, in breach of paragraph 2 of the order of Foxton J of 4 April 2025. Accordingly, other than emails from four MAS accounts (some of which have been lost or destroyed), there are no disclosed electronic documents at all.
- In these circumstances, I draw the inference (particularly in the light of all of the other features of the evidence in this case discussed above) that the Globe Documents and the Tenancy Agreement were backdated, are shams, and were fabricated with the knowledge of the Defendants, in particular the Al Sari Defendants and Mr. Almheiri. I accept the Claimants' submission that the Globe Documents were created by them with the intention of giving the false impression of obligations owed by the BVI Companies to Globe, when in fact no such obligations were actually assumed. I find that Mr. Almheiri signed the Globe Documents at the direction of the Al Sari Defendants who were the true directing mind and will of Globe in relation to the Globe Documents.[22]
- As I have explained, the creation and use of the Globe Documents and the Tenancy Agreement follow a similar pattern; each set of fabricated documents were deployed as a mechanism to the same end by the Al Sari Defendants: namely to seek to frustrate the Bank's enforcement efforts and to preserve the Bridge Properties for the Al Sari Defendants. I infer that all traces of how these documents came to be fabricated have either been destroyed or at any rate deliberately remain undisclosed by the Defendants.
- There are many other unsatisfactory features concerning the void in the Defendants' disclosure and their obstructive approach to these proceedings to which the Claimants advert in paragraphs 93-110 of their skeleton argument for trial. Whilst I consider each of those points to be well founded, in view of the foregoing findings, I do not consider it is necessary to itemise them all in this judgment.
ILLEGITIMATE USE MADE OF THE FABRICATED DOCUMENTS BY THE DEFENDANTS IN LEGAL PROCEEDINGS
- Having fabricated the Globe Documents and the Tenancy Agreement, various proceedings then took place in which the Defendants sought to rely upon them in their attempts to preserve the Bridge Properties for the Al Sari Defendants.
The Globe Proceedings
- On 17 April 2019 (being two weeks after Majid Al Sari's appeal against the Final Charging Order), Globe commenced the Sharjah Globe Proceedings, seeking to give legal effect to the Globe Documents. However, despite his appointment two months earlier, Globe did not serve the Receiver. I find that that this was so because the Al Sari Defendants knew that the Globe Documents were fabricated and they did not want the Receiver to scrutinise them. Instead, the Receiver and the Bank later discovered that Mr. Ali Al Aidarous, the long-standing lawyer of the Al Sari Defendants and their corporate vehicles (who also acted for IGPL in DIFC proceedings in July 2018), was on the record for the BVI Companies[23]. This is notwithstanding that the Receiver held the relevant authority to instruct legal representatives to act for the BVI Companies under the terms of the Final Charging Order, and had replaced the directors of the BVI Companies.
- The BVI Companies' registered address was in the BVI but they were, no doubt deliberately, served by Globe at Horizon Energy LLC's address. Horizon Energy LLC is a company owned and managed by the Al Sari Defendants (including through Sari Investments LLC).
- On 5 May 2019, Mr. Al Aidarous sought to progress the Sharjah Globe Proceedings with an unusual degree of expedition. He submitted a 2-page memorandum putting Globe to proof two weeks after the claim was issued, and both parties requested that the case be "scheduled for ruling" on 20 May 2019, no doubt because the Al Sari Defendants (or their front) were acting for both sides. This dishonest attempt to obtain a quick ruling in Globe's favour on the basis of the fabricated Globe Documents was only prevented by the Court's own intervention: it identified that there was nothing to confirm the legitimacy of Mr. Al Aidarous' authority, and required him to produce a power of attorney.
- Mr. Al Aidarous then claimed to be instructed in the Sharjah Globe Proceedings under a power of attorney dated 22 January 2015 and executed by a former director of the BVI Companies, Mr. Papp, appointed while the BVI Companies remained under the Al Sari Brothers' control. However, Mr. Papp had resigned on 14 December 2016, being two years earlier. The Receiver had replaced the directors in any event. This led, in or around July or August 2019, to the Receiver becoming aware of and intervening in the proceedings. The Receiver appointed a new lawyer and filed a proper defence.
The Tenancy Proceedings
- On 20 June 2019, the Receiver's solicitors wrote to Majid Al Sari advising him that the Bridge Properties would be sold. Just seven days later, on 27 June 2019, Majid Al Sari's solicitors responded with instructions to "draw your client's attention" to the Tenancy Agreement, revealing its supposed existence for the first time. On 11 July 2019, IGPL GT wrote to the Receiver asserting its purported rights under the Tenancy Agreement.
- On 28 July 2019, IGPL GT commenced proceedings against the Receiver in the DIFC in reliance on the Tenancy Agreement, seeking to "declare and affirm" it (the "First DIFC Tenancy Proceedings"). However, once again the proceedings were not served on the Receiver. IGPL GT sought to explain that it was made without notice to the Receiver "in ultimate consideration of the overriding objective" in light of the alleged complexity and/or delay involved in effecting service in the BVI. That is a hopeless excuse. I find that the real reason was that, as with the Globe Documents, the Al Sari Defendants were seeking to obtain a favourable judgment without alerting the Receiver; in particular without allowing the Receiver to raise question marks over the genuineness of the Tenancy Agreement.
- On 26 November 2019, the Receiver notified IGPL GT that he intended to sell the Bridge Properties within two months. By a letter of response dated 2 January 2020, IGPL GT's solicitors notified the Receiver of the First DIFC Tenancy Proceedings but even then did not enclose a copy of the claim. The Receiver's lawyer confirmed that he was instructed to accept service, but this never occurred. Finally, and only after the DIFC Court questioned why IGPL GT had brought the claim without notice, the claim was withdrawn or dismissed.
- I find that this was another dishonest attempt by the Al Sari Defendants to use a fabricated document, without notice to the Receiver, in their attempt to retain the Bridge Properties.
The Sharjah Globe Judgment
- In the Sharjah Globe Proceedings, experts appointed by the Sharjah Court of First Instance met on 30 January 2020. Globe provided them with the Globe Performance Documents supposedly as evidence that the Globe Documents were genuine. The opinion of the experts was that these documents were irrelevant to the Globe Proceedings and ultimately "the above-mentioned documents submitted by the Plaintiff are fabricated". This opinion was accepted by the Court of First Instance, which dismissed Globe's claim on 17 March 2020 ("the Sharjah Globe Judgment"). On 13 April 2020, Globe appealed against this decision to the Sharjah Federal Appeal Court (see paragraph 116 below).
- In the meantime, no doubt as a result of the expert finding of fabrication, on 9 February 2020, Abdalla and Majid Al Sari revived the earlier Sharjah Proceedings (referred to in paragraph 45 above) by filing a petition for review of the Sharjah Federal Appeal Court's decision, handed down some 3 years earlier, based on allegedly new evidence (as well as later seeking a stay in the BVI on 11 November 2020), stating that they had "discovered the existence of a new exhibit [a letter] that the ... Bank failed to submit to the court during the consideration of the case, which would change the court's opinion". This petition was dismissed by the appeal court as "groundless" on 26 April 2021, and it stated that the letter produced by Majid Al Sari was "apparently corrupt and cannot be used as evidence". In any event it had "no legal effect".
- On 10 July 2020, the Receiver sold the freehold in the Bridge Properties to a third party and notice to quit was served on IGPL GT and the Al Sari children, but they refused to quit.
- On 11 November 2020, Majid Al Sari made an application to amend his April 2019 appeal to the Final Charging Order based on the February 2020 Petition, and sought a further stay of the Final Charging Order. Both were refused by the BVI Court of Appeal on 15 December 2020.
The DIFC Injunction and the First Globe Appeal Judgment
- On 26 January 2021, IGPL GT made a without notice application to the DIFC Court for an injunction restraining dealings in the Bridge Properties ("the Second DIFC Tenancy Proceedings"). The injunction was granted on 31 January 2021 and it prevented the BVI Companies from selling or otherwise disposing of the Bridge Properties ("the DIFC Injunction").
- On 30 March 2021, the BVI Companies applied to the DIFC Court for summary judgment on the Tenancy Agreement on the basis that it was a sham and created without the authority of the BVI Companies. It was shortly after this, on 6 April 2021, that the First Globe Appeal Judgment was handed down in which the Sharjah Federal Appeal Court found that the BVI Companies were indeed indebted to Globe (it not having been argued in those proceedings that the Globe Documents were backdated shams – see further below).
- The BVI Companies (as parties) and the Bank (as a non-party) petitioned the Sharjah Court of Appeal for reconsideration of the First Globe Appeal Judgment on 21 July 2021.
- Meanwhile, on 14 April 2021, IGPL GT issued a further claim against the Bank and the BVI Companies in Sharjah by which they sought to establish that the Tenancy Agreement was valid (the "Sharjah Tenancy Proceedings"). This action was dismissed on 15 June 2021 on the basis of lack of jurisdiction as, despite IGPL GTs insistence that the Tenancy Agreement was concluded and damage was sustained in Sharjah, the Tenancy Agreement contained a DIFC exclusive jurisdiction clause.
- On 22 August 2021, Justice Giles, a judge of the DIFC Court, gave summary judgment in favour of the BVI Companies on the basis that Abdalla Al Sari was not authorised by the BVI Companies to sign the Tenancy Agreement; but he considered that whether the Tenancy Agreement was a sham was not something that could be determined summarily. An appeal was dismissed in March 2022 and IGPL GT's DIFC Injunction was discharged.
The Second Globe Appeal Judgment and the Federal Supreme Court Judgment
- On 5 October 2021, the Sharjah Federal Court of Appeal dismissed the petition of the BVI Companies and the Bank for reconsideration of the First Globe Appeal Judgment ("the Second Globe Appeal Judgment").
- On 8 November 2021, the BVI Companies and the Bank appealed against the Second Globe Appeal Judgment to the Federal Supreme Court. The appeal of the BVI Companies was dismissed by the Court on procedural grounds on 28 December 2021, whereas the petition of the Bank was remitted in part (under Article 169(6)) of the UAE Civil Procedure Law) ("the Third Globe Appeal"). Further, on 30 March 2022 the Sharjah Federal Court of Appeal held that the Bank's petition was in fact inadmissible and dismissed it ("the Third Globe Appeal Judgment")[24].
Possession proceedings
- After the discharge of IGPL GT's DIFC Injunction, the BVI Companies issued possession proceedings in England on 5 April 2022 as a result of the Al Sari Defendants' staff occupying the Bridge Properties ("the Possession Proceedings"). IGPL GT applied to join the Possession Proceedings on 1 June 2022 on the basis of its interest in the sham Tenancy Agreement, and the joinder application was granted at a hearing in December 2022. By the time of the joinder application hearing, the postcode discrepancy of the Bridge Properties had been discovered, and the Judge hearing the joinder application, HHJ Gerald, considered that "the only answer can be that the document is a sham" and he fixed the trial of the possession hearing for 15 May 2023.
- At this point, around February 2023, the Al Sari Defendants entirely disengaged from the Possession Proceedings and these proceedings. Despite having taken no steps to enforce the First Globe Appeal Judgment for two years, Globe suddenly commenced enforcement action by seeking a worldwide freezing order against the Bank and BVI Companies from the DIFC Court on 11 April 2023 on the basis that the Bank was seeking to sell the relevant asset. I find that this was undoubtedly because the Defendants knew that the court would shortly find the Tenancy Agreement to be a sham.
- This is precisely what then occurred: on 28 April 2023, judgment in the Possession Proceedings was given and a possession order made in favour of the BVI Companies on the basis that the Tenancy Agreement was a backdated fabrication in the light of the postcode discrepancy (the "Possession Order").
- Despite this fact, a without notice freezing order was obtained from the DIFC Court (Justice Michael Black) by Globe on 3 May 2023 ("the DIFC WFO"). On the back of the DIFC WFO, in May 2023 the Al Sari Defendants' housekeeper, Mr. Gebremedhin, represented by Charles Russell Speechlys LLP solicitors ("CRS")[25], inexcusably refused to hand over possession of the Bridge Properties on the spurious basis that to do so might lead to him being in breach of the DIFC WFO. Indeed, even after the DIFC WFO was discharged on 19 June 2023, Mr. Gebremedhin refused to vacate and applied, with the surprising assistance of Stepien Lake LLP solicitors, for an urgent injunction to stay the Possession Order. This was an obviously hopeless application which Mr. Gebremedhin should never have been supported to make and it was dismissed and certified as being totally without merit by Ritchie J on 4 September 2023. Possession of the Bridge Properties was finally taken by the Bank on 6 September 2023.
- Aside from continually advancing spurious legal arguments, between June and October 2022, Globe, at the suit, I have no doubt, of the Al Sari Defendants, had also pursued a vindictive course of conduct against Dr. Tayeb, the Head of the Bank's legal department and formerly a director of the BVI Companies. On four separate occasions Globe applied to the Sharjah Court on spurious grounds (that he might seek to dissipate the assets of the BVI Companies) for an arrest warrant against Dr. Tayeb. This vexatious behaviour culminated in Dr. Tayeb being subject to an interim travel ban and consequently being stranded at an airport when trying to go on holiday with his family. Dr. Tayeb ceased to be a director of the BVI Companies in July 2022 but notwithstanding that, Globe has continued to harass him with other vindictive applications to the Sharjah Court, rather than pursuing proceedings to enforce the First Globe Appeal Judgment in England or the BVI.
- Last, on 26 May 2023, Globe commenced enforcement proceedings in the BVI and at the same time contested the jurisdiction of the English courts. In November 2023, in the BVI proceedings, Globe sought a freezing order against the BVI Companies, with such application being resolved on undertakings which were given by the Claimants pending the determination of the current proceedings.
THE GLOBE APPEAL JUDGMENTS
- In this section of the judgment, I intend to summarise in more detail how the Globe Appeal Judgments came to be handed down and precisely what they decided, in order to determine (i) whether the First Globe Appeal Judgment was obtained by fraud and (ii) if it was, whether the BVI Companies and the Bank are precluded from alleging fraud by reason of the bringing of the Second and Third Globe Appeal proceedings. The proceedings developed as follows[26].
- From 17 April 2019, Globe pursued the Sharjah Globe Proceedings against the BVI Companies based on the Globe Documents in Sharjah. The Court dismissed the claim on 17 March 2020.
The First Globe Appeal Judgment was obtained by fraud
- Globe appealed against that dismissal of its claim. On Globe's appeal, the BVI Companies' position was that the Globe Documents were "invalid" because they were "not signed by the person authorized to sign on behalf of [them]". They argued that: (i) Abdalla Al Sari was not authorized to enter into transactions for the BVI Companies; (ii) the Globe Settlement Agreement (1 November 2018) came after the provisional charging order in the BVI Proceedings (13 September 2018); and (iii) in any event, the Globe Documents were a fabrication.
- It is important to understand that the BVI Companies' submissions did not allege that the Globe Documents had been backdated as they had not yet received the email communication from Royal Mail, which Dr Tayeb received on 26 March 2022 confirming this fact in relation to the Tenancy Agreement (referred to above).
- The Sharjah Federal Court of Appeal appointed a new panel of experts. They were assigned to "determin[e] the contractual relationship between [Globe] and [the BVI Companies]", the consideration received by the BVI Companies, the capacity of the individuals who signed the Globe Documents, and when the debt fell due. The experts were not, however, asked to consider, and did not consider, any argument that the Globe Documents were backdated; rather, they took the date of the documents on their face. Unsurprisingly therefore, the experts found that the Globe Documents created a valid debt.
- The First Globe Appeal Judgment was then handed down in favour of Globe: the court held that the BVI Companies were indebted to Globe.
- I find that the First Globe Appeal Judgment was obtained by fraud by reason of the fact that Globe's case which it dishonestly presented to the court was that the Globe Documents were authentic, binding agreements, rendering the BVI Companies indebted to Globe and that Abdalla Al Sari had authority to sign the Globe Documents on behalf of the BVI Companies. None of that was true, as Globe knew through the Al Sari Defendants and Mr. Almheiri. The Globe Documents were inauthentic, backdated and signed without authority by Abdalla Al Sari in an attempt to prevent the Bank from enforcing its judgment against the Bridge Properties.
Law: foreign judgment obtained by fraud
- A foreign judgment obtained by the fraud of a party to the suit in the foreign court cannot afterwards be enforced by that party in an action brought in an English court, even though the question whether the fraud had been perpetrated was investigated in the foreign court, and it was there decided that the fraud had not been committed: Abouloff v Oppenheimer (1882) 10 QBD 295. The same test applies whether the court is concerned with recognition or enforcement of a foreign judgment. It is necessary to show conscious and deliberate dishonesty (in the same way that that is required when seeking to impeach an English judgment): Midtown Acquisitions v Essar [2017] 1 WLR 3083 at [56]-[65] per Teare J.
- Moreover the fraud must be "operative" in the sense that "without such fraud having been practised the order would not have been made, or there is a real possibility that it would not have been made": Gelley v Shephard [2013] EWCA Civ 1172 at [48]-[50]. In the present case, these false statements were operative on the court which gave the First Globe Appeal Judgment as without them there was at least a real possibility that judgment would not have been given in Globe's favour. Indeed, in view of the Sharjah Globe Judgment, without the reliance upon the sham Globe Documents, I consider that it is very likely that the First Globe Appeal Judgment would not have been made in Globe's favour.
The Petitions for Reconsideration: the preclusion issue
- The BVI Companies (as parties) and the Bank (as a non-party) petitioned the Sharjah Court of Appeal for reconsideration of the First Globe Appeal Judgment under Article 169 of the (former) Civil Procedure Law ("the CPL"). The issue accordingly arises as to whether the Claimants are precluded from contending that the First Globe Appeal Judgment was procured by fraud, by reason of the first and second petitions for review made in Sharjah by the BVI Companies and the Bank, which petitions were rejected in the Second and Third Globe Appeal Judgments respectively. Having advanced a case of preclusion on a summary basis and failed, Globe has failed to adduce any expert evidence of UAE law in relation to it for trial (unlike the Claimants, who rely upon the expert report of Mr. Ramadan).
- The preclusion issue requires a consideration of House of Spring Gardens Ltd v Waite (No 2) [1991] 1 QB 241, in which it was held that where a party has itself litigated before a foreign court its claim that a foreign judgment was obtained by fraud, it may be precluded by a second foreign judgment in which that claim is rejected from raising the same fraud defence again in a further set of proceedings.
- In House of Spring Gardens, the Claimant brought an action in the Republic of Ireland against certain defendants alleging breach of confidence ("the first action"). Costello J found in favour of the Claimant in the first action ("the Costello judgment"). Subsequently, the defendants commenced fresh proceedings in Ireland to set aside the Costello judgment for fraud (based upon allegedly fresh evidence). Egan J rejected the suggestion that the Costello judgment had been obtained by fraud and he dismissed the first action. Thereafter the Claimant brought an action in England seeking to enforce the Costello judgment, and the defendants claimed once again, by way of defence, that the judgment had been obtained by fraud (based upon the same fresh evidence). The defendants sought to rely upon Abouloff for the proposition that the foreign judgment (the Costello judgment) could be impeached for fraud even though no newly discovered fraud was relied upon and the fraud might have been, and was, relied upon in the foreign proceedings.
- In the English Court of Appeal, Stuart-Smith J considered that the scope of Abouloff should not be extended further and that case was clearly distinguishable. He stated at [251] that:
"In none of these cases [i.e. Abouloff] was the question whether the judgment sued upon here was obtained by fraud, litigated in a separate and second action in the foreign jurisdiction. Unless Egan J.'s decision is itself impeached for fraud, it is conclusive of the matter thereby adjudicated upon, namely, whether Costello J.'s judgment was obtained by fraud."
- The principle contained in the House of Spring Gardens is a species of estoppel or abuse of process. It will operate where the fraud defence raised in the English proceedings was necessarily determined by the second foreign proceedings.
- Since it is an exception to the Abouloff rule, it will operate only where the fraud has already been raised and adjudicated upon "in a separate and second action",[27] or "in new proceedings after a final and enforceable judgment has been entered in earlier foreign proceedings".[28] That is the natural corollary of the fact that "[a] foreign order which is liable to be abrogated or varied by the court which pronounced it is not a final judgment" so as to give rise to an issue estoppel.
- In House of Spring Gardens, Stuart-Smith LJ added at [254]-[255]:
"The judge did not find it necessary to deal with the question of abuse of process. In my opinion the same result can equally well be reached by this route, which is untrammelled by the technicalities of estoppel… Hunter v Chief Constable of the West Midlands Police [1982] AC 529, 536 was a case where the court would not permit a collateral attack on the decision of a court of competent jurisdiction. The principle has recently been applied in this court to analogous cases, where issues of fact have been litigated exhaustively in sample cases; it is an abuse of process for a litigant, who was not one of the sample cases, to re-litigate all the issues of fact on the same or substantially the same evidence: see Ashmore v. British Coal Corporation [1990] 2 Q.B. 338.
The question is whether it would be in the interests of justice and public policy to allow the issue of fraud to be litigated again in this court, it having been tried and determined by Egan J. in Ireland. In my judgment it would not; indeed, I think it would be a travesty of justice. Not only would the plaintiffs be required to re-litigate matters which have twice been extensively investigated and decided in their favour in the natural forum, but it would run the risk of inconsistent verdicts being reached, not only as between the English and Irish courts, but as between the defendants themselves."
- As will become apparent when the facts of the Second and Third Globe Appeal judgments are considered, the House of Spring Gardens principle has no application to the present case and the Claimants are not precluded by reason of that principle from alleging in these proceedings that the First Globe Appeal Judgment was obtained by fraud in respect of the Globe Documents, nor is it an abuse of process for them to do so. Before considering these issues, it is necessary first to consider the precise nature of the two petitions for reconsideration filed in Sharjah by the BVI Companies and the Bank as a matter of UAE law.
- Article 169(1) CPL provides as follows:
"The litigants may file motions for reconsideration in respect of the final judgments and rulings rendered in the following instances:
1. If the adverse party has committed an act of fraud which affected the underlying judgment or ruling;
2. If the judgment or ruling has been based on documents which, after the same is rendered, are acknowledged or turned out to be forged, or based on a witness testimony, which, after the judgment or ruling is rendering, turned out to be a perjury;
3. If, after the judgment or ruling is rendered, the moving party obtains instrumental documents which have been withheld by the adverse party;
4. If the judgment or ruling awards legal remedy not claimed by the litigants or in excess of their claims;
5. If the operative part of the judgment or ruling is self-contradictory;
6. By a party who considers that the judgment or ruling rendered on the legal proceeding is adversely affecting its interests where such a party has neither intervened in, nor been impleaded into, the underlying legal proceeding, provided that such a party proves the fraud, collusion or gross negligence of the representative acting on his behalf; or
7. If the judgment or ruling is rendered against a natural or legal person who has not been duly represented in the legal proceeding."
- Mr. Ramadan gave expert evidence on behalf of the Claimants as to the nature and effect of the relevant provisions of the CPL and I accept his evidence which I consider to be balanced and persuasive. My analysis below draws upon his expert report and the cases cited by him.
- Article 169(1) permits review of a judgment where the opposing party (in this case, Globe) commits a fraud affecting the judgment. However, only a party to the claim may petition under that provision (in this case, the BVI Companies)[29], and crucially, the fraud must be one that was not discoverable until after the proceedings concluded.[30] That is consistent with the Globe's own pleaded position,[31] as well as the position Globe took repeatedly in the Sharjah Globe Proceedings.
- There are many decisions of the UAE courts which confirm this point. By way of illustration only in the Federal Supreme Court Case 8/2004, the court concluded as follows:
"In order for fraud to render admissible a petition for reconsideration as provided for in article 169(1) of the Code of Civil Procedure, three requirements must be met: ?rst, it must have been committed by the Respondent or his representative; second, the fraud must have impacted the Court's decision such that it would have reached a di?erent conclusion in the absence of the fraud; third, the fraud must have been hidden from the Petitioner until the judgment was issued. In alleging the fraud, it is not permissible to rely on facts previously presented and discussed before the Court. It is clear from an examination of the records of the appealed judgment that, as the case was being heard on the merits, the First Petitioner submitted a brief to the Court in which he showed that most of the seven companies have not held valid licenses for more than 20 years, are controlled by the First Respondent, and were merged into his companies. This means that the alleged fraud was not hidden from the Petitioner …" (emphasis added)
And in the Dubai Court of Cassation Case 123/2011:
"In order for fraud to render admissible a petition for reconsideration, it must be an act of deception in violation of proper morals that undermines the work of the court. It is established that the fraud must have been discovered after the issuance of the judgment and must have been established before the submission of the petition for reconsideration." (emphasis added)
- Article 169(6) on the other hand provides as follows:
"The litigants may file motions for reconsideration in respect of the final judgments and rulings rendered in the following instances: …
6. By a party who considers that the judgment or ruling rendered on the legal proceeding is adversely affecting its interests where such a party has neither intervened in, nor been impleaded into, the underlying legal proceeding, provided that such a party proves the fraud, collusion or gross negligence of the representative acting on his behalf."
- This article accordingly permits a petition by a non-party (i.e. the Bank) on the basis of the "fraud, collusion or gross negligence of the representative acting on his [here, the Bank's] behalf", that is acting on his behalf in the proceedings.[32] In this context:
150.1. A 'representative' does not require a strict relationship of agency; it is the person 'representing' the interests of the non-party in the proceedings.[33] In this case that was the Receiver (through whom the BVI Companies acted), representing the Bank's interest in resisting the alleged debt under the Globe Documents.[34]
150.2. The 'fraud, collusion or gross negligence' of the 'representative' must concern conduct in the proceedings. The rationale of Article 169(6) is to protect a non-party against unfairness it may suffer in the proceedings to which it is not joined.
- Again, there are many decisions of the UAE courts which confirm this point. By way of illustration only, in the Federal Supreme Court case 125/19, the court stated as follows:
"The implication of this provision is that the petition for reconsideration constitutes an exceptional remedy against final judgments in the specific cases exhaustively enumerated in said Article, including where a judgment is binding upon a party who was not personally present in the proceedings—whether as an original party, intervenor, or third-party joined—but was deemed legally represented therein by the adjudicated party, and provided that the fraud, collusion, or gross negligence of such representative is proven. It also includes the case where a party was not properly represented in the case."
- By Article 171, the BVI Companies' and the Bank's Petition for Reconsideration had to be made to the same court; it might then even be heard by the same judges. Article 171 CPL states:
"1. The petition shall be prosecuted to the court which issued the decision with a brief deposited in the court case management office according to the usual procedures of the action prosecution.
2. The brief should include the manifest of the sentence in which the petition was submitted, its date and the petition reasons or it shall be void.
3. The court to examine the petition may be consisted of the same judges who have issued the decision."
- It follows that I accept Mr. Trotter's submission that the petition procedure under Article 169 does not constitute a "second and separate action" (of the type envisaged in House of Spring Gardens) which determined whether the First Globe Appeal Judgment was obtained by fraud. Rather, it amounts to a procedural mechanism for the same court to reconsider its judgment, which is fundamentally different to a fresh action before a new court to set aside a judgment for fraud and to vindicate a substantive right. A judgment which is re-opened by the same tribunal upon petition is not final and enforceable and the petition procedure cannot be regarded as a second and separate action.
- As I have said, the first petition for reconsideration of the First Globe Appeal Judgment was brought by the BVI Companies and the Bank purportedly under Article 169 CPL. However, in considering the first petition for reconsideration, the Sharjah court giving the Second Globe Appeal Judgment found that the BVI Companies' petition was "inadmissible". The reason for that finding was that the criteria set out in article 169(1) and (6) were not satisfied[35]. Article 169(1) only applied if the fraud was "not apparent to the opponent throughout the duration of hearing the case" (i.e. it was only subsequently discovered). That was not so here.
- The Sharjah Court giving the Second Globe Appeal Judgment also dismissed the Bank's petition, as a non-party, under Article 169(6), noting that "[the Bank] did not prove that item (6) of Article 169 which permits it to file the appeal, is applicable to this case". That is because there was no fraud, collusion or gross negligence of the Bank's representative in the conduct of the proceedings. Accordingly, the Sharjah Court ruled that the petition "may not be filed".
- In short, the Second Globe Appeal Judgment was concerned with a narrower enquiry than whether Globe's claim was fraudulent, being based upon sham documents. Rather, it was concerned with whether there was an undiscovered fraud post-dating the First Globe Appeal Judgment (there was not) and whether there was fraud, collusion or gross negligence by the non-party's representative in the conduct of the proceedings (there was not).
- In short, I accept Mr. Ramadan's conclusion that "the Court of Appeal did not decide anything other than that the First Globe Appeal Judgment was not amenable to review by the Bank or the BVI Companies pursuant to Articles 169(1) and (6)."
- Since the Second Appeal Judgment was not a second decision as to whether the First Globe Appeal Judgment was procured by fraud, it also follows that first petition for reconsideration cannot be an abuse of process in the Henderson v Henderson or the Hunter sense, and nor can there be any issue estoppel. In Henderson v Henderson (1843) 3 Hare 100, Wigram V-C stated in a celebrated passage of his judgment at 115 as follows:
"… where a given matter becomes the subject of litigation in, and of adjudication by, a court of competent jurisdiction, the court requires the parties to that litigation to bring forward their whole case, and will not (except under special circumstances) permit the same parties to open the same subject of litigation in respect of matter which might have been brought forward as part of the subject in contest, but which was not brought forward, only because they have, from negligence, inadvertence, or even accident, omitted part of their case. The plea of res judicata applies, except in special cases, not only to points on which the court was actually required by the parties to form an opinion and pronounce a judgment, but to every point which properly belonged to the subject of litigation, and which the parties, exercising reasonable diligence, might have brought forward at the time."
- There can be no issue estoppel and it cannot be abusive to argue now matters which the BVI Companies and (even less) the Bank could not have argued, and did not argue, before the Sharjah Court which gave the Second Globe Appeal Judgment (because they were limited to the much narrower Article 169(1) and (6) arguments). They cannot be shut out from arguing matters which were not even decided, and nor would that be so as a matter of UAE law: see Ramadan Report at [162].
- Appeal to the Federal Supreme Court: Both the Bank and the BVI Companies appealed to the Federal Supreme Court. On 28 December 2021, the Federal Supreme Court dismissed the BVI Companies' appeal on account of a defect in the power of attorney submitted on their behalf. That brought the BVI Companies' petition, based upon Article 169(1), to a conclusion.
- However, the Supreme Court held that the Sharjah Court which gave the Second Globe Appeal Judgment had failed properly to consider a particular argument advanced by the Bank, namely that the BVI Companies had failed to disclose that they had been sold to the Bank, and failed to join the Bank. It held that: "… those companies were sold to … [the Bank], in enforcement of such judgements. The defense of the [BVI] companies did [not] refer to this, nor included [i.e. "joined"] in the case for which a judgement was requested, by way of fraud and collusion, to cause harm to him". The Second Globe Appeal Judgment had "ruled the inadmissibility of the petitioner's petition … without any decision thereon…, which renders the judgment insufficient". Accordingly, it remitted solely that argument on the Bank's petition for consideration to the "Third Globe Appeal Court".
- In its Third Globe Appeal Judgment, the Third Globe Appeal Court found the Bank's petition to be inadmissible on a very narrow question. The issue of fraud was not in issue in the Third Globe Appeal Judgment as the court was only considering the disclosure and joinder issues (referred to in the previous paragraph) remitted to the court under Article 169(6). Indeed, that was Globe's own position.[36] There can be no preclusion in these proceedings as a result.
- The BVI Companies applied to intervene in the Bank's petition, but their application was refused[37] and so for this reason as well, this is not a case like House of Spring Gardens where a party could have joined the second set of proceedings but chose not to do so. Nor is it abusive (in the Hunter sense) for the BVI Companies now to seek to raise the fraud issue which they could not have raised in the Third Globe Appeal Court (as they could not in the Second Globe Appeal proceedings) and which they were not even permitted to join.
- Nor can any issue estoppel arise in these circumstances. The BVI Companies are accordingly not bound by the Third Globe Appeal Judgment. No estoppel arises against a non-party as a matter of UAE law and, as Mr. Trotter rightly submitted, the Third Globe Appeal Judgment cannot have a greater preclusive effect in England than it would have in the UAE. I would add that, as Mr. Trotter rightly submitted, as a matter of English law, the BVI Companies are not privies of the Bank merely by reason of the Bank's indirect shareholding in them.
- Finally, in the course of the Bank's remitted petition, certain documents were filed on behalf of the BVI Companies even though they were no longer parties to the proceedings, and arguments were advanced regarding the underlying fraud pursuant to Article 169(1). It is for that reason that the Third Globe Appeal Judgment adverts in passing to these points. However, as Mr. Ramadan makes clear in his report and I accept, these points were no longer in issue and it was not open to the BVI Companies to raise them.[38] Accordingly the Claimants are right to submit that these fraud arguments plainly cannot be regarded as "necessarily determined" by that judgment in order to found any estoppel. They were not.
- Accordingly I accept Mr Ramadan's evidence that "[The] Third Globe Appeal Judgment was strictly limited to the Court finding that the First Globe Appeal Judgment was not amenable to review by the Bank under Article 169(6) of the CPL only. The Third Globe Appeal Court had no authority to test any fraud under Article 169(1)."
- It follows that, focussing on the Bank's position, the House of Spring Gardens principle is not engaged at all against the Bank, because it was not party (or privy) to the First Globe Appeal Judgment (and accordingly its position is of no relevance to the declaratory relief sought by the Claimants). It is not bound by the Second Globe Appeal Judgment because it successfully appealed against it. The first judgment against the Bank is the Third Globe Appeal Judgment and it is not precluded by that as it was only entitled to petition upon the narrow grounds of Article 169(6), which are much narrower than the issue before this court[39]. In any event, the Third Globe Appeal Judgment is the first judgment against the Bank and so were it necessary the Bank could impugn that judgment for fraud under the Abouloff rule (not having commenced any second action so as to trigger the House of Spring Gardens principle).
- So far as the BVI Companies' position is concerned, the House of Spring Gardens principle is not engaged against them: the Second Globe Appeal Judgment was not given in a second and separate action; it was concerned with the much narrower Article 169(1) issue; and they were not parties to the Third Globe Appeal Judgment.
- In the circumstances, the Bank and the BVI Companies are not precluded from alleging and proving that the First Globe Appeal Judgment was obtained by fraud.
- In the light of my findings, I do not consider that it is necessary to go on to consider the Claimants' further arguments that (i) if the Second/Third Globe Appeal Judgments really did resolve the fraud which the Claimants now allege, they did so without any judicial determination of the facts and in a manner contrary to English conceptions of substantial justice; and (ii) in any event, there are special circumstances, given developments since those judgments, which mean it is not abusive to (re)litigate the issue of whether the First Globe Appeal Judgment was obtained by fraud.
K. Relief
- The principles governing the court's jurisdiction to grant declarations were summarised by Aikens LJ in Rolls-Royce PLC v Unite the Union [2010] 1 WLR 318 (CA) at §120 as follows:
"(1) the power of the court to grant declaratory relief is discretionary.
(2) There must, in general, be a real and present dispute between the parties before the court as to the existence or extent of a legal right between them. However, the claimant does not need to have a present cause of action against the defendant.
(3) Each party must, in general, be affected by the court's determination of the issues concerning the legal right in question.
(4) The fact that the claimant is not a party to the relevant contract in respect of which a declaration is sought is not fatal to an application for a declaration, provided that it is directly affected by the issue.
(5) The court will be prepared to give declaratory relief in respect of a "friendly action" or where there is an "academic question" if all parties so wish, even on "private law" issues. This may particularly be so if it is a "test case", or it may affect a significant number of other cases, and it is in the public interest to decide the issue concerned.
(6) However, the court must be satisfied that all sides of the argument will be fully and properly put. It must therefore ensure that all those affected are either before it or will have their arguments put before the court.
(7) In all cases, assuming that the other tests are satisfied, the court must ask: is this the most effective way of resolving the issues raised. In answering that question it must consider the other options of resolving this issue."
- In the present case, there is a real and present dispute between the parties as to enforceability of the First Globe Appeal Judgment. The affected parties are joined to the litigation and have had the opportunity to put their arguments. Each party will be affected by the court's determination of the issues concerning the enforceability of the First Globe Appeal Judgment.
- I am fully satisfied that all sides of the argument have been fully and properly put, and in so far as the Defendants have any arguable defences to the claim, the Claimants have very fairly put them before the court. I consider the relief which is sought to be the most effective way of resolving the issues raised.
- In all the circumstances, I find that the Claimants are entitled to the declarations which they seek that (i) the First Globe Appeal Judgment was obtained by fraud; and (ii) the Tenancy Agreement, Addendum and Globe Documents are shams, were made without authority and are void and of no effect. Both sets of documents were backdated and created for the purpose of harming the Claimants.
- The Claimants also seek an injunction to restrain Globe from taking any step (including in the BVI Globe proceedings) to enforce the First Globe Appeal Judgment[40].
- The Court has a broad discretion to grant injunctions under section 37 of the Senior Courts Act 1981. The Claimants here ask the Court to grant an anti-enforcement injunction generally rather than one which is confined to these proceedings.
- In Ellerman Lines Ltd v Read [1928] 2 KB 144 at 152-153 per Scrutton LJ, the learned judge stated as follows:
"The English Courts have therefore clearly jurisdiction to restrain a person who is subject to the English jurisdiction from taking Proceedings in a foreign Court in breach of contract and in fraud. But Mr. Wilfrid Lewis took the point that while an injunction can be granted to restrain the institution or continuation of proceedings in a foreign Court there is no power, after the foreign Court has given judgment, to grant an injunction restraining the person who has obtained it from reaping its fruits. If there is no authority for this it is time that we made one, for I cannot conceive that if an English Court finds a British subject taking proceedings in breach of his contract in a foreign Court, supporting those proceedings, and obtaining a judgment, by fraudulent lies, it is powerless to interfere to restrain him from seeking to enforce that judgment. I am quite clear that such an injunction can be and in this case ought to be granted..."
- Atkin LJ agreed saying, at p 155:
"The principle on which an English court acts in granting injunctions is not that it seeks to assume jurisdiction over the foreign court, or that it arrogates to itself some superiority which entitles it to dictate to the foreign court, or that it seeks to criticize the foreign court or its procedure; the English court has regard to the personal attitude of the person who has obtained the foreign judgment. If the English court finds that a person subject to its jurisdiction has committed a breach of covenant, or has acted in breach of some fiduciary duty or has in any way violated the principles of equity and conscience, and that it would be inequitable on his part to seek to enforce a judgment obtained in breach of such obligations, it will restrain him, not by issuing an edict to the foreign court, but by saying that he is in conscience bound not to enforce that judgment."
- Eve J also agreed saying, at p 158:
"The foreign proceedings here were instituted and prosecuted in clear breach of the contract, and the judgment was ultimately obtained by a deliberate and flagrant misrepresentation. The appellants in those circumstances are entitled to all protection which this court can extend to them."
- Whilst it has been said that this power will only be exercised in exceptional cases: Masri v Consolidated Constructors [2009] QB 503 at [94] per Lawrence Collins LJ (as he then was), citing Ellerman, in Bank St Petersburg v Arkhangelsky [2014] 1 WLR 4360 at [36]-[38] Longmore LJ discussed Ellerman and concluded as follows:
"36. Mr Marshall emphasised the exceptional nature of an anti-enforcement injunction as opposed to an anti-suit injunction. He said that the only example in the decided cases was the much stronger case of Ellerman Lines Ltd v Read …
37. The principle so laid down [in Ellerman] was restated in Masri v Consolidated Constructors International (UK) Ltd … para 94, per Lawrence Collins LJ albeit in the context of enjoining Yemeni proceedings inconsistent with an English judgment in proceedings in which the defendant had submitted to the jurisdiction.
38 Mr Marshall was correct to say that Ellerman Lines Ltd v Read [1928] 2 KB 144 was a stronger case but only to the extent there that the English trial had already taken place so that there was a finding that the Turkish judgment had been procured by fraud. Here the trial has not yet taken place and the allegations of fraud are only allegations. But an interim injunction had been granted in Ellerman's case to protect the position pending trial: see pp 146—147. So here it seems to me that an injunction against continuing existing enforcement proceedings or initiating new enforcement proceedings should be granted."
- In the present case I have found that the foreign judgment (the First Globe Appeal Judgment) was obtained by the fraud of the Defendants. The Court has power to prevent a person subject to its jurisdiction from taking action on such a judgment and I am fully satisfied in this case that I should do so in the exercise of my discretion.
- The parties had proceeded on the basis that these proceedings will determine the issue in the BVI; Globe's application for a freezing order has been adjourned against undertakings given by the BVI Companies, pending determination of these proceedings[41]. However, Globe has now disengaged from these proceedings and the Claimants are understandably concerned, in view of the Defendants' conduct - which includes obtaining unjustified arrest warrants in Sharjah; a worldwide freezing order in the DIFC; an attempted enforcement claim in January 2025 for AED 582m in Dubai which the Dubai Court of First Instance held it had no jurisdiction to hear; and very recently further proceedings in Sharjah - that such an injunction against Globe, operating in personam, is necessary to prevent it from continually seeking to perpetuate its fraud. I consider that such an injunction is undoubtedly necessary and that granting it will in fact further the principle of comity, by ensuring that another foreign court is not misled by these Defendants, rather than infringing it.
- In all the circumstances I grant the relief sought by the Claimants. I invite the Claimants' counsel to put before the court a draft order for its consideration in light of the terms of this Judgment.
