Commercial Bank of Dubai PSC v Abdalla Juma Majid Al Sari

Hearing date: 23 May 2024

Approved Judgment

This judgment was handed down remotely at 10.30am on Wednesday 12 June 2024 by circulation to the parties or their representatives by e-mail and by release to the National Archives.

This is an appeal by Abdalla Juma Majid Al Sari and his son, Majid Abdalla Juma Al Sari, against the order of Mr Justice Butcher committing each of them to prison for 24 months for contempt of court. The appellants were referred to at the hearing as ‘Abdalla’ and ‘Majid’ respectively and I shall adopt the same course. The contempts which the judge found to be proved against them consisted of multiple failures to comply with the disclosure requirements of a worldwide freezing order granted by Mrs Justice Cockerill on 18 ^th February 2022 and continued by Mr Justice Calver on 11 ^th March 2022.

The appellants challenge both the findings of contempt and the sentence imposed on them. However, the principal submission made on their behalf is that they were not validly served with notice of the hearing on 4 ^th October 2023 at which they were found to be in contempt. They did not attend, and were unrepresented at, that hearing, although they did have notice of the later hearing on 20 ^th November 2023 at which the sentence of imprisonment was imposed and were represented at that hearing by counsel.

Background

In 2012 the first respondent, the Commercial Bank of Dubai (‘the Bank’), commenced proceedings in Sharjah to recover substantial debts from the first to fifth defendants. Those proceedings resulted in a judgment for the equivalent of about £87 million issued by the Sharjah Federal Court of First Instance in March 2016. Attempts to challenge this judgment on appeal finally ended on 26 ^th April 2021 with a ruling by the Sharjah Federal Court of Appeal finding (among other things) that a letter purportedly signed by Majid was a fabrication.

As a result of enforcement proceedings in the BVI, in April 2021 the Bank took control of the shares in the second to fourth respondents (‘the BVI companies’), special-purpose vehicles formerly controlled by Majid and his brother, the third defendant (‘Mohamed’). The BVI companies owned properties in London said to be worth about £9 million at that time, including a luxury apartment known as ‘the Bridge Apartment’. The Bank caused the BVI companies to bring proceedings to obtain possession of the Bridge Apartment, which was only finally obtained in September 2023.

The worldwide freezing orders

On 18 ^th February 2022 the Bank and the BVI companies (together ‘the claimants’) issued proceedings here to enforce the Sharjah judgment and to claim damages against the defendants. They applied for and obtained a worldwide freezing order against each of the defendants, including the appellants. The order was continued at the return date on 11 ^th March 2022. The orders required the appellants, in summary:

(1) to disclose all of their assets worldwide with a value exceeding £50,000, together with all bank accounts and companies over which they had control, whether directly or indirectly, within 24 hours;

(2) to disclose the location of all ‘Asset Documents’ (defined to mean documents evidencing the existence or balance of bank accounts and assets exceeding £50,000 in value) within 48 hours;

(3) to disclose any disposals of assets to related parties or disposals made at an undervalue between 1 ^st October 2015 and 18 ^th February 2022 within five working days;

(4) to identify any third parties holding Asset Documents, also within five working days;

(5) to deliver up any Asset Documents in their custody or possession within seven working days;

(6) to serve a confirmatory affidavit, including details of any asset subject to an attachment or similar order in the United Arab Emirates, also within seven working days; and

(7) to give written instructions to third parties holding Asset Documents to deliver them up, and to deliver up copies of those instructions, within five days of the continuation order.

At the same time as making the without notice freezing order, Mrs Justice Cockerill made an order (‘the First Service Order’) for alternative service of ‘the claim form, particulars of claim, all orders of today's date and all other documents in these proceedings’. Service on Abdalla was permitted by post to his address at PO Box 6600, Sharjah, UAE. Service on Majid was permitted by post to his address at PP No: A-0088444 Shj Villa 719-721-723, Sharjah, UAE and by email to majid@faloil.co.ae. In addition the claimants were required to notify the appellants of the proceedings by delivering the claim form, particulars of claim, all orders made on 18 ^th February 2022, their skeleton argument and all other documents in the hearing bundle for the without notice application to two firms of lawyers in Dubai and Sharjah which had acted for the appellants.

The claimants served the freezing order by the alternative means specified in the First Service Order on 23 ^rd February 2022, but the appellants and other defendants sought to evade service. The appellants or persons acting on their behalf sought to do this by hanging up telephones, refusing deliveries, refusing to authorise ‘read receipts’ to emails, and denying that they worked for Al Sari companies. A representative of the claimants' solicitors spoke to Abdalla on the telephone, but he said that he did not want to hear what she would say, asked her to speak to his legal representative, and declined to say who that representative was. More seriously, a junior member of the claimants' solicitors who had delivered documents to the law firm in Dubai was threatened in Whatsapp and voice messages: the threat was to call the police with an allegation that the files left contained drugs.

Neither the appellants nor the other defendants made any effort to comply with the disclosure obligations in the freezing order. At the return date hearing on 11 ^th March 2022, when the appellants were represented by leading counsel instructed by Charles Russell Speechlys LLP (‘CRS’), Mr Justice Calver observed that they had ‘taken steps to avoid being served with these proceedings’, had ‘simply ignored’ their disclosure obligations, and had offered ‘no apology and no suggestion that they are going to comply’. He described an affidavit by Majid (‘Majid 1’) as ‘entirely inadequate’.

On 11 ^th March 2022 Mr Justice Calver made a further order (‘the Second Service Order’), without notice to the defendants, expanding the provision for alternative service made by Mrs Justice Cockerill. His order provided, among other things:

‘Pursuant to CPR 6.15(2), the steps taken by the Claimants to notify the Defendants of the Service Documents are deemed to be good service. The Claimants have permission to serve all further documents in these proceedings by any or all of the following alternative means, in addition to or alternatively to those set out in paragraph 3 of the Service Order (as amended):

…

2.2 the First Defendant: by sending the documents and/or a link to them by WhatsApp and/or text message to [a telephone number ending '4488] …’

Accordingly the effect of the Service Orders was that the claimants had permission to serve ‘all further documents in these proceedings’ on Abdalla by WhatsApp and/or text message to the '4488 number and on Majid by sending them to the majid@faloil.co.ae email address.

On 14 ^th April 2022 CRS indicated that they were instructed that their clients wished to comply with their asset disclosure obligations and proposed to do so by 28 ^th April. Instead of doing so, however, they made an application to the court in Sharjah seeking to prevent the freezing order from being enforced against them. That application was dismissed.

Eventually, on 13 ^th May 2022 the appellants filed a second affidavit by Majid (‘Majid 2’) in purported compliance with their asset disclosure obligations. In reality, however, the affidavit consisted more of explanations why they could not or would not comply: that they had no interest in various companies apart from being appointed as their manager; that their assets in the UAE were subject to attachment orders which rendered them valueless; and that they could be exposed to penalties in the UAE for disclosing information confidential to the companies which they managed. Apart from this, they neither provided any disclosure nor gave any explanation for failing to do so.

The contempt application

On 12 ^th May 2022 the claimants issued an application to commit the defendants, including the appellants, for contempt of court. The application...