1) Albert John Martin Abela and Others (Respondents/Claimants) v Ahmad Baadarani
| Jurisdiction | England & Wales |
| Judge | Lord Justice Longmore |
| Judgment Date | 15 December 2011 |
| Neutral Citation | [2011] EWCA Civ 1571 |
| Docket Number | Case No: A3/2011/0380 |
| Court | Court of Appeal (Civil Division) |
| Date | 15 December 2011 |
[2011] EWCA Civ 1571
The Right Honourable Lady Justice Arden
The Right Honourable Lord Justice Longmore
and
The Right Honourable Lord Justice Mcfarlane
Case No: A3/2011/0380
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGHT COURT OF JUSTICE
CHANCERY DIVISION
SIR EDWARD EVANS LOMBE (Sitting as a High Court Judge)
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr Paul Greatorex (instructed by M & S Solicitors Ltd) for the Appellant
Mr Clive Freedman QC & Mr Tim Penny (instructed by PCB Litigation LLP) for the Respondents
Hearing dates: 8th & 9th November 2011
Mr Abela and his companies ("the claimants") wish to sue Mr Ahmad Baadarani and a Cypriot company called Cicines Ltd ("the defendants") for fraudulent misrepresentation and conspiracy in relation to a contract whereby the claimants agreed to buy shares owned by the defendants in an Italian company called Gama SpA. The contract to buy the shares was dated 26th March 2002, was governed by English law and contained a non-exclusive jurisdiction agreement for the English courts. The claimants allege that the defendants knew at the time of the sale that the shares were worthless but concealed from them that important fact and fraudulently stated that the opposite was true. The first defendant Mr Baadarani, denies that he had any such knowledge or made any fraudulent statements about the value of their shares. He says further that, since proceedings were only instituted in England on 30th April 2009, the proceedings are time-barred, to which the claimants respond by saying that they did not know of the fraud until they received reports from a firm of forensic accountants called Kroll in May and June 2003. The claimants then started both criminal and civil proceedings in a rolled-up form of litigation in Lebanon where Mr Baadarani is resident but those proceedings are nowhere near any fruition. On 14th September 2009, Morgan J granted the claimants permission to serve the English claim form and associated documentation on Mr Baadarani in Lebanon, extended time for service of the claim form until 31st December 2009 and gave permission to serve the relevant documents untranslated on Mr Baadarani at an address in Beirut, on the claimants' undertaking to take no further steps in the Lebanese civil proceedings. Mr Baadarani has now applied to set aside both the permission to serve him and the service of the proceedings purportedly made pursuant to that order or a later order of Lewison J. The second defendant has been served and has made no attempt to set aside that service. The action against that defendant is therefore properly constituted in England.
Mr Baadarani has argued that there is no real issue between himself and the claimants which it is reasonable for the court to try pursuant to CPR 6.37(2) and that the English court should not be satisfied that England is the proper place in which to bring the claim pursuant to CPR 6.37(3). The grounds on which it is said that there was no real issue between the parties were (a) that the matter in dispute had been resolved in litigation between the claimants on the one hand and their former solicitors Hammonds and a Mr Haan on the other hand which had been settled in 2009 and (b) that the proceedings were time-barred. Sir Edward Evans-Lombe dismissed those contentions saying that what he called "the Haan action" had not been intended to settle or resolve issues between the claimants and the defendants and that it was, at any rate, arguable that the claimants had not discovered the fraud or concealment of the defendants (if they existed) until after 30th April 2003. Mr Baadarani applied for permission to appeal these two decisions but his application was adjourned to the full court by Arden LJ when she gave leave on the more substantial aspects of the case. I would for my part refuse Mr Baadarani's application, now that we have had heard the oral argument, on these two matters.
The reason given by Mr Baadarani for saying that England was not the proper place to bring the claim was that proceedings already existed in Lebanon and should continue there. The judge decided that England was the proper place for the proceedings broadly because the parties had agreed to the jurisdiction of the English courts, the Cypriot company claimant was not a party to the Lebanese proceedings and the claimants had in any event undertaken to take no further steps in the Lebanese civil proceedings. Arden LJ has given Mr Baadarani permission to appeal this part of the judge's decision.
The judge further decided that service of the English proceedings on Mr Baadarani's Lebanese lawyer Mr Azoury on 22nd October 2009 was to be treated as good service, because he (the judge) could and should retrospectively validate the alternative service which had then taken place; he did not, therefore, need to decide whether orders of Sales J and Lewison J extending time for service to 30th April 2010 and 30th June 2010 respectively and a further order of the latter judge giving permission for service by alternative means on Mr Baadarani's English and Lebanese solicitors should be set aside. But he expressed the view that there was ample material justifying the order of those learned judges and that there was no justification for interfering with them. Arden LJ has granted permission to Mr Baadarani to challenge the judge's decision that service on Mr Azoury was to be treated as good service of the proceedings on 22nd October 2009. If that challenge succeeds, the claimants will then seek to rely on the orders of Sales J and Lewison J.
England – the proper place
The onus of showing that England is the proper place for the proceedings is on the claimants but if a judge is satisfied that England is indeed the proper place, it is for the appellant to show why he was wrong. The reasons given by the judge as set out in para 3 above are compelling reasons; if the parties to an agreement have agreed that the English court is to have jurisdiction, England will be the proper place for the proceedings unless there is some extremely strong argument to the contrary. In theory, the fact that proceedings have already been started elsewhere might constitute such an argument but the claimants' undertaking has removed that argument quite apart from the facts (1) that the third claimant is the purchaser of the majority of the shares and is not even a party to the Lebanese proceedings and (2) that the proceedings against the second defendant will be proceeding in England in any event.
The only serious arguments advanced by Mr Greatorex for Mr Baadarani against the judge's decision in this respect were (1) that Mr Abela was the effective claimant, had decided in October 2003 to institute proceedings in Lebanon and should not, nearly 6 years later, be allowed to change tack and start proceedings here and (2) that the undertaking not to continue the civil proceedings was inadequate for the protection of the defendants because they still remained at foot and nothing had changed since the claimants had given their undertaking to Morgan J.
As to the first argument, if a claimant has 6 years (or whatever other appropriate period) to begin proceedings, and the parties have agreed that any proceedings may take place in England, that agreement should be upheld even if the claimant has been somewhat dilatory provided that the defendant can be protected from being doubly vexed by additional proceedings elsewhere which Morgan J's order achieved.
The second argument is equally without foundation. The undertaking relates to civil proceedings since it would be inappropriate for the English court to require the criminal aspect of any proceedings to be stayed. Mr Baadarani has never suggested an alternative form of undertaking despite the judge's offer (para 54) to reconsider the terms of the undertaking if Mr Baadarani was dissatisfied with it. He is, therefore, adequately protected and should not be allowed to extricate himself from his agreement as to the venue of the action.
I would therefore dismiss the first ground of appeal and turn to the second ground.
Service of the Claim Form
The claimants have three submissions as to the correct service of the claim form within the Rules any one of which, if it is upheld, will be sufficient to constitute good service. These are:-
1) service on 22nd October 2009 on Mr Baadarani's Lebanese lawyer Mr Azoury who had a power of attorney enabling him to receive legal documents; although this form of service was not authorised by the original order of Morgan J, it was open to the judge to validate that service retrospectively because it had been service in accordance with the local law of Lebanon;
2) service pursuant to the order for alternative service made by Lewison J on 14th April 2010 on Mr Baadarani's Lebanese solicitor Mr Azoury;
3) service pursuant to the same order of Lewison J on Mr Baadarani's English solicitors.
In order to understand these contentions it is necessary to set out the facts in some detail.
The Facts
The history of the matter begins with the issue of the claim form on 30th April 2009. The validity of that claim form would expire after six months on 29th October 2009. Since the agreement in respect of which the claimants have brought their proceedings was made in 26th March 2002 and the latest date on which the claimants say that they became aware of the...
To continue reading
Request your trial
-
Cruz City 1 Mauritius Holdings v Unitech Ltd and Others
...issue of proceedings… 16 These observations were accepted and applied by the Court of Appeal in the later case of Abela v Baardarani [2011] EWCA Civ 1571. 17 In neither Cecil v Bayat nor Abela was there any reference to the invariable practice in the Commercial Court in relation to arbitrat......
-
YA II PN Ltd v Frontera Resources Corporation
...at an address different from that specified in the order. It is apparent from the judgment of Longmore LJ in the Court of Appeal [2011] EWCA Civ 1571, paragraph 10(1), that it was accepted by the claimant that service on the lawyer was not authorised by the order granting permission to ser......
-
1) Albert John Martin Abela and Others (Respondents/Claimants) v Ahmad Baadarani
...44 Before Lord Neuberger, President Lord Clarke Lord Sumption Lord Reed Lord Carnwath THE SUPREME COURT Trinity Term On appeal from: [2011] EWCA Civ 1571 Appellant Clive Freedman Tim Penny (Instructed by PCB Litigation LLP) Respondent Andrew Onslow QC Paul Greatorex Instructed by M&S Solic......
-
Bitumex (HK) Company Ltd v IRPC Public Company Ltd
...of service under the law of the country …”—see Amalgamated Metal v Baron [2010] EWHC 3207 (Comm) at [37]-[40], Abela v Baadarani [2011] EWCA Civ 1571 at [22]. So far as an application for substituted service is concerned, Mr Hatt for the Defendant says that the same considerations apply: ......
-
CURING NON-COMPLIANCE WITH FOREIGN LAWS IN THE CONTEXT OF SERVICE OUT OF JURISDICTION
...Bank of Sudan[2006] EWHC 1767 (Comm) at [30]. 91[2011] EWHC 116. 92Abela v Baadarani[2011] EWHC 116 at [65]. 93Abela v Baadarani[2011] EWCA Civ 1571 at [20], [23] and [29]. 94Abela v Baadarani[2013] UKSC 44 at [24]. 95Abela v Baadarani[2011] EWCA Civ 1571 at [22]. 96 [2013] UKSC 44. 97 Abel......