Christopher Morris and Others v Banque Arabe Et Internationale D'investissement Sa
| Jurisdiction | England & Wales |
| Judge | MR. JUSTICE NEUBERGER |
| Judgment Date | 06 December 1999 |
| Judgment citation (vLex) | [1999] EWHC J1206-16 |
| Court | Queen's Bench Division (Administrative Court) |
| Docket Number | Case No. 007614 of 1990 |
| Date | 06 December 1999 |
[1999] EWHC J1206-16
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
COMPANIES COURT
Royal Courts of Justice,
Mr. Justice Neuberger
Case No. 007614 of 1990
MR. RICHARD ADKINS Q.C. and MS. ROXANNE ISMAIL (instructed by Messrs. Travers Smith Braithwaite) appeared on behalf of the Applicants
MR. RICHARD SHELDON Q.C. and DR. FIDELIS ODITAH (instructed by Messrs. Lovell, White Durrant) appeared on behalf of he Respondent.
As approved by the Judge)
Introduction
The claimants (the Liquidators) are the liquidators of BCCI S.A. and BCCI Overseas. They began these proceedings against the defendant, Banque Arab et Internationale d'Investissement S.A. (BAII), a French company, on 2nd July 1997.
The proceedings are brought under section 213 of the Insolvency Act 1986, and are based on the liquidators' contention that BAII knowingly participated in two illegal acquisitions of American banks in 1982 and 1985 by BCCI, and knowingly participated and assisted in BCCI's fraudulent overstatement of assets and earnings in the years 1985 to 1989.
Directions were given on 27th November 1997. They included an order that discovery was to be given 56 days after Points of Reply had been served and inspection of documents was to take place 28 days thereafter.
Points of Claim were served on 28th November 1997. On 12th February 1998, BAII's former solicitors wrote to the liquidators' solicitors. They referred to the fact that they had written a week before the directions were made, contending that BAII would be unable to disclose documents if, by doing so, it would be in breach of French law. BAII's former solicitors went on to say: "We have come to the conclusion that it would assist not only our client's defence of the claim but also the action generally if we were to obtain a release in respect of those documents either from the French authorities or the third parties to whom my clients might owe a duty of confidentiality. Without the documentation, it is unlikely to be possible for our client adequately to defend the claim. Our client would be forced to submit a purely technical defence which will not take this matter much further. In addition, if our client can obtain a release of relevant documents, it will enable our client to give adequate discovery rather than be prevented from allowing your clients access to relevant information." BAII's former solicitors also asked for an extension of time generally for the service of Points of Defence.
After further correspondence, the liquidators' former solicitors replied refuting that the contention of French law posed any problems for BAII in giving discovery and inspection and refusing to agree an extension of time. The court, however, granted an extension of time to BAII, and Points of Defence were served on its behalf on 7th June 1998.
Much of the Points of Defence consisted of non-admissions. In their enclosing letter, BAII's then solicitors wrote in these terms: "As you are aware, BAII as a French bank, is subject to French legislation, commonly known as the Blocking Statute, and to banking confidentiality provisions. Breach of either the Blocking Statute or the confidentiality provisions may expose officers of BAII to criminal penalties. We consider it will assist you in your consideration of the Points of Defence if we draw to your attention the effect that the existence of such prohibitions has had upon the use of non-admission in the pleading … On a number of occasions which, for obvious reasons, we cannot specifically identify, an allegation made in the Points of Claim has been not admitted in the point of defence since, to admit or deny the same would constitute a breach of the Blocking Statute or the banking confidentiality laws." Meanwhile, on 24th August 1998, BAII's then solicitors wrote referring to the Hague Convention and another bilateral convention between Britain and France in 1922, asking whether the liquidators intended to pursue either route as a way of obtaining documents. On 26th August 1998, the liquidators' solicitors replied stating that the Hague Convention did not apply.
Points of Reply were served on 7th October 1998 and on 3rd December, BAII (who had changed to their current solicitors) applied for a variation of the order of 27th November 1997 so as to avoid having to give inspection of certain documents.
On 7th December 1998, the liquidators applied to strike out the Points of Defence in so far as they consisted of allegedly unjustified non-admissions.
Each party has filed evidence. On 9th February 1999, BAII's solicitor exhibited an inventory of relevant documents which had been produced by BAII, and said this in the accompanying affidavit: "I am informed that some of the Documents listed in the inventory are subject to confidentiality obligations of third party under banking law. BAII is taking steps to obtain waivers of the confidentiality obligations from the persons to whom the obligations are owed." BAII's solicitor went on to say: "I am also informed that BAII will assist in the making of and comply with any orders which may be made by the relevant French judicial authority pursuant to letters of request under the Hague Convention." On 29th October 1999, pursuant to an agreement made between the parties, BAII and the liquidators exchanged lists of documents.
The Issue The issue now before me is whether the provisions of the Civil Procedure Rules (the CPR) which provide for a litigant to permit inspection of documents of which he has given disclosure by list, permit the litigant to avoid giving such inspection in circumstances where he would be acting in contravention of legislation of another country in which he carries on business, is domiciled and resident, and where the Documents are situated, and the impact on that issue of the other country being a signatory to the Hague Convention.
It is clear from the Points of Defence, as explained by the accompanying letter from BAII's solicitors and from the inventory and list of documents provided by BAII on 9th February and 29th October 1999, that BAII is claiming immunity from having to give inspection of a large number of documents, apparently some Documents (the Documents).
The basis upon which BAII is seeking to avoid giving inspection is no longer based on banking confidentiality. That ground was abandoned only two or three weeks before the hearing. The basis upon which inspection is sought to be avoided is pursuant to a French statutory provision known as Article 1 bis of the Act of 26th July 1968 (the "Blocking Statute").
The Relevant Rules and Statutes I turn to the basic provisions. Disclosure and inspection are dealt with under the CPR in part 31.
Rule 31.10 provides as follows: "31.10 —(1) The procedure for standard disclosure is as follows.
"(2) Each party must make, and serve on every other party, a list of documents in the relevant practice form ….
"(4) The list must indicate — "(a) those documents in respect of which the party claims a right or duty to withhold inspection; …." The Documents to be disclosed on standard disclosure are set out in rule 31.6. So far as relevant, that provides as follows: "31.6 Standard disclosure requires a party to disclose only — "(a) the documents on which he relies; and "(b) the documents which — "(i) adversely affect his own case; "(ii) adversely affect another party's case; or "(iii) support another party's case ….".
The right of inspection of a disclosed document is dealt with under rule 31.3: "31.3 —(1) A party to whom a document has been disclosed has a right to inspect that document except where —"(a) the document is no longer in the control of the party who disclosed it; "(b) the party disclosing the document has a right or a duty to withhold inspection of it; ….
"(2) where a party considers that it would be disproportionate to the issues in the case to permit inspection of documents within a category or class of document disclosed under rule 31.6(b) — "(a) he is not required to permit inspection of documents within that category or class; but "(b) he must state in his disclosure statement that inspection of those documents will not be permitted on the grounds that to do so would be disproportionate." Rule 31.19 deals with a claim to withhold disclosure or inspection of a document: "31.19 —(1) A person may apply, without notice, for an order permitting him to withhold disclosure of a document on the ground that disclosure would damage the public interest ….
"(3) A person who wishes to claim that he has a right or a duty to withhold inspection of a document, or part of a document must state in writing — "(a) that he has such a right or duty; and "(b) the grounds on which he claims that right or duty.
"(4) The statement referred to in paragraph (3) must be made — "(a) in the list in which the document is disclosed; or "(b) if there is no list, to the person wishing to inspect the document.
"(5) A party may apply to the court to decide whether a claim made under paragraph (3) should be upheld.
"(6) For the purpose of deciding an application under paragraph (1) (application to withhold disclosure) or paragraph (3) (claim to withhold inspection) the court may — "(a) require the person seeking to withhold disclosure or inspection of a document to produce that document to the court; and "(b) invite any person, whether or not a party, to make representations." Of course, the approach of the court to the interpretation...
To continue reading
Request your trial