Global Torch Ltd and Others v Apex Global Management
| Jurisdiction | England & Wales |
| Judge | Mr Justice Morgan |
| Judgment Date | 13 February 2013 |
| Neutral Citation | [2013] EWHC 223 (Ch) |
| Docket Number | No. 10609/2011 |
| Court | Chancery Division |
| Date | 13 February 2013 |
[2013] EWHC 223 (Ch)
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
COMPANIES COURT
Royal Courts of Justice
Rolls Building,
London, EC4A 1NL
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
COMPANIES COURT
Mr Justice Morgan
Mr Justice Morgan
No. 10609/2011
No. 10850/2011
IN THE MATTER OF FI CALL LIMITED
AND IN THE MATTER OF THE COMPANIES ACT 2006
AND IN THE MATTER OF THE INSOLVENCY ACT 1986
IN THE MATTER OF FI CALL LIMITED
AND IN THE MATTER OF THE COMPANIES ACT 2006
Mr Mark Warby QC (instructed by Clifford Chance LLP for the Applicants
Mr Timothy Otty QC, Ms Neill and Ms Zaffuto (instructed by Clifford Chance LLP) for Prince Abdulaziz and Prince Mishal
Mr Christopher Harrison and Mr Alexander Cook (instructed by Clifford Chance LLP) for Mr Abu-Ayshih
Mr Robert Howe QC, Mr Daniel Lightman, Ms Shaheed FatimaandMr Paul Adams (instructed by Howard Kennedy) for Apex Global Management Ltd and Mr Almhairat
Mr Guy Vassall-Adams (instructed by In-house Lawyers) for Guardian News and Media Ltd and The Financial Times Ltd
Hearing dates: 19 th, 20 th and 21 st December 2012
Approved Judgment
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
Introduction
This judgment concerns certain applications which have been made in two unfair prejudice petitions in the Companies Court. I will describe the applications in more detail in due course but, in brief summary, the purpose of the applications is to obtain orders from the court which will result in certain disputed allegations of fact, which are made in the two petitions, being dealt with by the court sitting in private and, furthermore, orders that non-parties to the petitions, and in particular representatives of the media, may not obtain a copy of court documents in this case.
Background matters
Fi Call Ltd ("the Company") was incorporated on 23 rd October 2009 under the Companies Act 2006 ("the 2006 Act"), as a private company limited by shares. The principal shareholders in the Company at the time of its incorporation, and since, have been Global Torch Ltd ("Global Torch") and Apex Global Management Ltd ("Apex"). Global Torch was incorporated in the British Virgin Islands. Apex was incorporated in the Seychelles and is wholly owned by a Jordanian businessman, Mr Almhairat, who at all material times has also been a director of the Company. At all material times, the other de jure director of the Company has been Mr Abu-Ayshih.
On 2 nd December 2011, Global Torch presented a petition to the Companies Court in relation to the Company, pursuant to section 994 of the 2006 Act. The Respondents to the petition were Apex, Mr Almhairat and the Company. Apex and Mr Almhairat will be referred to as "the Apex parties". It is Global Torch's case that the affairs of the Company were being conducted in a manner that was unfairly prejudicial to the interests of Global Torch. The principal relief sought was an order that Global Torch's shares be bought by the Apex parties, or one of them. Further and in the alternative, Global Torch sought an order winding up the Company on the just and equitable ground. In very brief summary, Global Torch alleged that Mr Almhairat in particular had misappropriated funds from the Company, had misconducted the Company's business in various ways, had failed to keep proper books and records, had failed to supply books and records to Global Torch and had blocked the holding of board meetings to discuss and to try to resolve matters. In particular, Global Torch pleaded that the relationship between it and Apex had been destroyed by the conduct of the Apex parties. It was pleaded that the destruction of the relationship had been exacerbated by false allegations of criminal conduct which the Apex parties had made about Global Torch and its shareholders; the allegations were said to be that Global Torch and its shareholders had used the Company for criminal purposes. It was also said that the Apex parties had threatened to publish these allegations to third parties.
Global Torch was given permission to serve the petition on the Apex parties out of the jurisdiction. The Apex parties have been duly served and do not dispute jurisdiction.
On 12 th December 2011, that is 10 days after presentation of the Global Torch petition, Apex presented its own petition in relation to the Company, pursuant to section 994 of the 2006 Act. The Respondents to the Apex petition were the Company, Global Torch, HRH Prince Abdulaziz bin Mishal bin Abdulaziz Al Saud ("Prince Abdulaziz"), Mr Abu-Ayshih and HRH Prince Mishal bin Abdulaziz Al Saud ("Prince Mishal"). Global Torch, Prince Abdulaziz, Prince Mishal and Mr Abu-Ayshih will be referred to as "the Applicants". Prince Abdulaziz is a director of and a shareholder in Global Torch. The Apex parties say that Global Torch is a corporate vehicle of Prince Abdulaziz. Prince Abdulaziz has also acted as Chairman of the Board of the Company notwithstanding that he is not a de jure director of the Company. The Apex parties say that Prince Abdulaziz has acted as a de facto and/or shadow director of the Company. Mr Abu-Ayshih is a private adviser to Prince Abdulaziz and is a director of and a shareholder in Global Torch, and a de jure director of the Company. Prince Mishal is the father of Prince Abdulaziz and the Apex parties make a number of allegations as to his involvement in matters said to be relevant to the Apex petition. The principal relief sought by the Apex petition is an order that one or more of the Applicants purchase Apex's shares in the Company.
In its petition, Apex alleges that the Applicants have caused the affairs of the Company to be conducted in a way which is unfairly prejudicial to the interests of Apex. It is said that Apex has lost trust and confidence in the willingness of the Applicants to manage the Company in a fair and proper manner. The pleaded allegations against the Applicants are:
(1) Prince Abdulaziz acted irregularly in relation to the Company in that, although he has never been a director of the Company, he has acted as a de facto or a shadow director of the Company and has purported to act as a de jure director of the Company and has purported to be Chairman of the Company;
(2) Prince Abdulaziz and Mr Abu-Ayshih have been guilty of wrongdoing in relation to a transaction described as "the Beirut transaction";
(3) Prince Abdulaziz and Mr Abu-Ayshih have been guilty of wrongdoing in relation to a transaction described as "the Nairobi transaction";
(4) Prince Abdulaziz and Prince Mishal made various statements to Mr Almhairat which are highly relevant to Apex's case that the affairs of the Company have been conducted in a manner unfairly prejudicial to Apex;
(5) In February and March 2010 there were four share sale agreements arranged by Prince Abdulaziz and/or Mr Abu-Ayshih; these agreements resulted in some Apex shares in the Company being sold in circumstances where Apex did not receive any of the proceeds of sale, which were instead taken by Prince Abdulaziz or the Company;
(6) In April 2011, following a sale by Apex of some of its shares, Prince Abdulaziz and Mr Abu-Ayshih demanded that Mr Almhairat pay to them a substantial part of the proceeds of that sale; Mr Almhairat did not comply with this demand following which Prince Abdulaziz and Mr Abu-Ayshih have been hostile to him in a number of ways including Prince Abdulaziz making a complaint about Mr Almhairat to the Saudi Arabian authorities leading to the issue of an arrest warrant against Mr Almhairat and the involvement of Interpol in Saudi Arabia and Jordan. This share sale transaction is the subject of the rival allegation made in the Global Torch petition that the Apex parties have misappropriated funds, namely, the part of the proceeds of sale demanded by Prince Abdulaziz and Mr Abu-Ayshih but not paid to them by Mr Almhairat.
When referring to the allegations in sub-paragraphs (2), (3) and (4) of paragraph 6 above, I have deliberately referred to matters in a very succinct and unrevealing way. That is because it is the Applicants' case that these three allegations should not be given a public airing and the applications which they bring are designed to prevent that happening. If I decide that these three allegations are not to be given a public airing, it would plainly be wrong for me in this judgment, which I intend to be available to the public, to refer to these allegations. Furthermore, even if I decide that these three allegations may be considered at court hearings heard in public, there may be an appeal to the Court of Appeal against my decision and I ought not to refer to the three allegations in more detail in this judgment, pending any such appeal. I will however set out these three allegations (and indeed two further allegations to which I will later refer) in a confidential schedule. At the end of this judgment, I will describe what use may be made of that confidential schedule, and in what circumstances.
Apex was given permission, ex parte, to serve its petition on the Applicants out of the jurisdiction and they have been duly served. Global Torch does not dispute jurisdiction in relation to the Apex petition. Prince Abdulaziz and Prince Mishal have applied for an order that the court had no jurisdiction against either of them on the grounds that each of them had state,...
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