Halpern v Halpern (No 1)
| Jurisdiction | England & Wales |
| Judge | MR JUSTICE CHRISTOPHER CLARKE |
| Judgment Date | 24 March 2006 |
| Neutral Citation | [2006] EWHC 603 (Comm) |
| Docket Number | Case No: 2005 FOLIO 370 |
| Court | Queen's Bench Division (Commercial Court) |
| Date | 24 March 2006 |
[2006] EWHC 603 (Comm)
IN THE HIGH COURT OF JUSTICE
COMMERCIAL COURT
QUEEN'S BENCH DIVISION
Mr Justice Christopher Clarke
Case No: 2005 FOLIO 370
David Berkley QC (instructed by Simon Bergin) for the Defendants
Romie Tager QC & Juliette Levy (instructed by Shammah Nicholls) for the Claimants
Hearing date: 27 th January 2006
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.
Rabbi Joseph Halpern ("Joseph" 1) died on 2 nd July 1999. He and his family were and are devout Orthodox Jews. Joseph was married to Frieda Halpern ("Frieda"). They had five sons –David, Mordechai, Jacob, Aron, and Israel – and one daughter – Esther. The family home was in Manchester where David, Mordechai and Jacob still live. The Halperns are prominent members of the Manchester Jewish community. By wills dated 6 th February 1989 Joseph and Frieda appointed David, Mordechai and Jacob ("the three brothers") as their executors and left to them their entire estate on trust for sale, the net proceeds to belong to them in equal shares. On 26 th June 1998 Joseph caused to be executed a Jewish will, written in Hebrew. This document, as is customary, was not signed by Joseph but is the record made by two witnesses on Joseph's instructions. It provided for (i) a legacy of £500 to be divided equally among his five sons, in fulfilment of the inheritance prescribed by the Torah; (ii) bequests of books and religious articles; and (iii) a bequest of his house to Frieda. The remainder of his possessions he left in accordance with a "reckoning" signed by him of 30 th November 1992 and the remainder after that was to be divided into 8 parts. Part was for Frieda, Parts 2, 3, 4 and 5 were for the three brothers and Esther. Parts 6 and 7 were to be held by his executors "as True Owner" for the benefit of Aron and Israel, but with £ 1,000 going to each of the two as a gift. Part 8 was to be given for charitable or benevolent purposes as selected by his executors. He appointed the three brothers as his executors and exempted them from the Shavuah– i.e. the requirement to swear an oath. The will provided that the executors should have the right to change the division (apart from the distribution of the £ 500).
The will contained a provision known as a S htar Chatzi Zochor, by which Joseph admitted that he owed Esther the sum of £ 10,000,000 payable one hour before his death on the condition that:
"..if my sons will want to give her a share, and allow the executors to fulfil all that has been explained above about the whole estate, even of those things the acquisition of which will not have been completely valid according to the laws of the Holy Torah, then they are exempt from repaying her the above sum."
The Torah provides that a daughter may not inherit unless there are no sons 2. An admission of a debt in excess of the value of the estate to be forgiven if the bequest to the daughter is honoured is, however, a means, long recognised as valid by Orthodox Jews, of ensuring that a daughter inherits notwithstanding the Torah.
The wills of 1989 have, I was told, been proved and the three brothers have administered the estate. The evidence does not reveal what was the value of the estate, although Esther's witness statement states that the value of Joseph's estate was well below the £ 10,000,000 owed to her from her father's estate.
Israel has six sons, one of whom is Samuel, who lives in Israel. As is perhaps apparent from the Jewish will Joseph and Israel were estranged. Israel left home aged 15 and the relationship between Joseph and Israel, and his wife and some of his children, worsened.
Frieda died on 6 th August 2000. She had also made a Jewish will, a copy of which is not in evidence, which contained a similar admission of liability to Esther of £10,000,000 to be foregone if her will was honoured.
Thereafter a dispute arose about the inheritance between Israel and the three brothers. Samuel, who is a Rabbinical scholar, represented Israel in this dispute. Israel and Samuel are now the claimants and the three brothers, together with Aron and Esther are the defendants. Aron and Esther have not been served.
It was incumbent on the Halperns, as Orthodox Jews, to seek to resolve the dispute in accordance with Jewish law and custom. The three brothers wished the matter to be resolved by the Manchester Beth Din or some other recognised Beth Din. The claimants wanted a specialist Beth Din. In the event it was agreed that the dispute should be decided by an ad hoc Beth Din, known as a Zavloh or Borrerus. Mordechai says that he and his brothers received a threat of a Ksav Sirruv, a form of sanction to which I refer hereafter, if they did not agree to the Zavloh.
Each side nominated a Rabbi. The three brothers nominated Rabbi Lichenstein. Israel and Samuel nominated Rabbi Marmarosh. The two Rabbis nominated Rabbi Schmerler. These three acted as Dayanim i.e. judges (hereafter "the dayanim"). The arbitration began in Zurich on 9 th January 2002. Israel and Samuel and the three brothers executed two documents, one produced by Rabbi Lichenstein and one by Rabbi Marmarosh. The one produced by Rabbi Lichenstein is described as a "Deed of Submission and Arbitration" and is between Israel and Samuel and the three brothers, all of whom have signed it. It is headed "In the matter of the Arbitration Act 1996" and "In the matter of an arbitration between" the claimants and the three brothers. It provides:
"WHEREAS a dispute or difference has arisen and still exists between the above parties and they have failed to come to terms:
AND WHEREAS it is the desire of the parties to refer such dispute or difference by way of Din Torah to the arbitration and final decision of the Beth Din of the above Zabla:
NOW THEREFORE the parties agree as follows:-
The parties hereby agree to refer to the arbitration and final decision of the Beth Din of the above Zabla, all disputes and differences between them, and all claims which either party alleges that he has against the other party, for determination by way of Din Torah according to the rules of procedure customarily employed in arbitrations before the Beth Din, and according to principles of halachah and/or general principles of equity customarily employed in arbitrations before the Beth Din.
The parties hereby agree each on their part to accept and perform the Award of the said Beth Din touching all disputes, differences and claims between the parties, which Award shall be final and binding, and to pay such costs as the Beth Din may determine within the period specified in the Award.
The parties hereby agree that should either party, after the preliminary hearing has been heard inter partes, subsequently fail without good cause to attend any subsequent hearing, the Beth Din may proceed to determine the matter ex parte."
The document produced by Rabbi Marmarosh was a Deed of Arbitration (known as a Shtar Birurim) also described as being between Israel and Samuel, on the one hand, and the three brothers on the other. It was signed by the claimants and the three brothers. It provided:
"There are between us disputes in the matter of the inheritance of our father Rabbi Josef Halpern of blessed memory
AND we have accepted upon ourselves the following chosen Rabbis to judge between us on all these claims
Rabbi Moishe Chaim Schmerler: Zurich
Rabbi Yisroel Marmorish: Bnei Brak
Rabbi Yisroel Yakov Lichtenstein: London
In the event that one of the Dayanim shall leave/depart or not be able to judge for whatever reason [at the time fixed by the remaining judges] – then the two remaining judges shall choose the third judge.
AND we commit and bind ourselves and all our belongings to fulfil all that they will decide whether as law as compromise or mistakenly and we have no right to dispute the decision neither in Jewish Law nor in secular law.
All this has been done in our goodwill and with a Kinyan Gomur Agav Sudor and not as an Asmachtoh nor is this a specimen document in the best possible and effective manner whether in accordance with Jewish Law or in accordance with the law of the kingdom
AND as proof we have come to sign on the 25 th of Teves 5762 here in Zurich all duly executed."
On the first day of the hearing Samuel invited the tribunal to exercise a discretionary power under Jewish law to seek an oath from the three brothers in relation to their claim that assets transferred to them during Joseph's life were gifts, as opposed to transfers made as part of a tax avoidance scheme; and as to the nature, location and value of assets of Joseph and his wife. If the dayanim had agreed, the three brothers would have been required to depose by way of an oath known as Chiyuv Shavuah as to the truth of their evidence. The swearing of such an oath is a matter of considerable religious significance. Mordechai's evidence is that an observant Jew would not be prepared to swear such an oath, even if what he was deposing to was true. The requirement to swear such an oath could not have been imposed by Rabbi Schmerler alone. The dayanim never ruled on Samuel's request.
The Zavloh sat for four sittings of one or two days each between January and July 2002 as follows:
9 th/10 th January Zurich
27 th January Manchester (Rabbi Schmerler did not attend)
6 th / 7 th March Zurich
1 st/2 nd July Zurich
By a letter to the three brothers of 2 nd September 2002 Esther wrote...
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