Mehta v Islamic Investment Company of the Gulf Ltd
| Jurisdiction | England & Wales |
| Judge | Lord Justice Aikens,Lord Justice Rimer,Lord Justice Toulson,Lord Justice Mummery,Sir Scott Baker |
| Judgment Date | 14 April 2010 |
| Neutral Citation | [2010] EWCA Civ 709,[2009] EWCA Civ 483 |
| Court | Court of Appeal (Civil Division) |
| Date | 14 April 2010 |
| Docket Number | Case No: A3/2009/2309,Case No: A3/2008/1936 |
[2009] EWCA Civ 483
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
COMMERCIAL COURT
(MR JUSTICE DAVID STEEL)
Royal Courts of Justice
Strand, London, WC2A 2LL
Lord Justice Rimer and
Lord Justice Aikens
Case No: A3/2008/1936
A3/2009/0612
Mr J Hines (instructed by Messrs Byrne) appeared on behalf of the Applicant.
Mr A Trace QC and Mr A Ayres (instructed by Messrs Norton Rose) appeared on behalf of the Respondent.
There are two matters before the court. The first is an application for permission to appeal a judgment given by David Steel J on 19 March 2009. That application before the judge was the seventh application of Mr Rajesh Kishor Mehta for the return of his passport. That had been taken from him by reason of an order of the judge in September 2008.
The background to the case and the order of the judge originally was all set out in a judgment which I gave in an application to this court for permission to appeal other orders of the judge some time ago and I will not repeat them now. The present application arises from David Steel J's order on 19 March where he refused that seventh application for the return of Mr Mehta's passport. He did so on the basis that there were no significant changes of circumstance that had occurred; that Mr Mehta was a flight risk and that he had failed to comply with any of the orders and conditions that had been made by the court in relation to previous orders. Therefore as a matter of discretion he refused to grant that application.
Mr Hines, who has appeared for Mr Mehta today, has submitted that the judge was plainly wrong in the way he exercised his discretion. He submitted that there were changes in circumstance. The particular change in circumstance he emphasised is that now Mr Mehta has come to the end of the time given to him by the Indian criminal courts whereby he was permitted to stay out of that jurisdiction, and unless he returns to India, there is a grave danger that he will be the subject of extradition proceedings by the Indian authorities. An application had been made to the Indian courts by Mr Mehta between the hearing before David Steel J on 12 March 2009 and that on 19 March 2009 for permission to extend time. That was refused by the Indian courts.
Mr Hines also submitted that Mr Mehta is not a flight risk in the way characterised by the judge, and submitted that there were good reasons why Mr Mehta did not comply with various court orders. We have listened carefully to those submissions. We think there is nothing in them. We think that the judge was correct to exercise his discretion in the way that he did and that it cannot be said to be either plainly wrong or that he took into account matters he should not have done or that he failed to take into account matters that he should have done. Therefore that application is refused.
The second application concerns the conditions that we attached to the permission to appeal that was granted (subject to conditions) by this court at the hearing on 20 February 2009. There were three conditions that we attached. The first was that Mr Mehta had to provide security for costs in the appeal in the sum of £80,000. That the second was that he had to pay all outstanding orders for costs against him, in the sum of approximately £204,000. The third was that all the money, the subject of a judgment as long ago as 2002 for $10,000,000-odd, should also be paid into court. All those conditions had to be fulfilled within 28 days of the hearing on 20 February 2009.
None of those conditions have in fact been fulfilled at all. Mr Hines now applies for those conditions to be varied so that, even after the period of time that has elapsed, there may be a period of 28 days during which the applicant, Mr Mehta, can explore means by which those sums can be paid into court. There is no statement that they will be paid into court by that time. It is said that there are only assets within India, which are subject to freezing orders, that can provide those sums. We are not prepared to make that variation in the terms that have been suggested by Mr Hines. We have some sympathy with the fact that $10,000,000 is a large sum to provide in short order, although at the time we made the order on 20 February 2009 there was no evidence before the court as to any difficulties that Mr Mehta might have in complying with the court order.
Having seen the information that we now have, it is my view and that of my Lord, as I understand it, that there should still be very strict time limits as to the conditions. Therefore I propose, and I understand my Lord to agree with this, that there should be a variation of the conditions upon the following terms, namely that, as a condition of having permission to appeal, Mr Mehta must, first, pay the security for costs sum of £80,000 by 4pm on Wednesday 8 April. Secondly, he must pay into court the outstanding costs sums, which are in fact £204,517.48, by 4pm on Tuesday 21 April. I should emphasise that strict compliance with those conditions are necessary pre-conditions for any appeal going ahead. In other words, if either the one or the other is not complied with, the appeal will stand dismissed. The third condition is that the $10,000,000 will be paid into court by 4 pm on 28 April. That third condition has with this proviso that, provided that the other conditions have been fulfilled, then, if the $10,000,000 is not going to paid in by 28 April at 4pm, there must be, before that time has expired, an application to the court to extend that time. Such application must be on notice to the claimants in this case. If there is such an application, then it must be upon the basis that it would be heard by this court no later than the week starting 11 May 2009.
On that basis and to that extent only the application to vary the conditions is granted.
I agree.
Order: Application granted in part
[2010] EWCA Civ 709
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM COMMERCIAL COURT
(Mr Justice David Steel)
Before: Lord Justice Mummery
Lord Justice Toulson
and
Sir Scott Baker
Case No: A3/2009/2309
Mr James Lewis QC and Mr James Hines (instructed by Byrne and Partners) appeared on behalf of the Appellant.
Mr Anthony Trace QC and Mr Andrew Ayres (instructed by Messrs Norton Rose LLP) appeared on behalf of the Respondent.
Lord Justice Toulson:
Mr Rajesh Mehta appeals against a finding of contempt made against him by David Steel J in a reserved judgment given on 1 October 2009 and a committal order made on the same day for nine months' imprisonment, suspended if he complied with other terms of the order within six weeks, pursuant to CPR 71.
The matter has a long history, set out in the judgment. What follows is a reduced summary, although it is still necessary to set out quite a lengthy chronology in the light of the arguments which have been advanced.
The proceedings arise from a finance agreement made between the claimants, an Islamic Investment Company, and the first defendants, who were diamond traders, in January 2000. The appellant guaranteed the obligations of the first defendants and both the financing and the guarantee agreement were subject to English law and English jurisdiction. An event of default having occurred, the claimants issued proceedings in 2001 against the first defendants and the appellant. In October 2001 the claimants obtained a worldwide freezing order against the appellant for over $10 million and an order that the appellant provide disclosure of his assets.
On 13 February 2002 Tomlinson J ordered that summary judgment be entered for the claimants against the first defendants and the appellant for a sum of just over $10 million. The amount now stands with interest at over $14 million. None of it has been paid. The history over the last eight years has been of the claimant's unsuccessful attempts to obtain payment. The appellant has never had difficulty in being represented by distinguished solicitors and counsel. The material parts of the history are chronicled in the judgment under appeal. Having summarised and having set out the history, the judge said at [51]:
“It is common ground that RM has the resources to meet the judgment debt. But in my judgment this history demonstrates that a determination on the part of RM to devote his time and money to avoid payment and to obstruct the enforcement process. The impression is fortified by the content of the oral examination as so far completed. I regret to say that my reaction is few witnesses have instilled still less confidence in their testimony whether from the perspective or reliability or completeness. Throughout he was evasive and unconvincing. Save where unchallenged, I would be hesitant to accept any of his evidence absent corroborative material.”
The oral examination to which the judge referred had taken place before him on 24 April, 27 April, 22 July and 23 July 2009. His examination was as a judgment debtor, pursuant to the provisions of CPR 71. The committal application was heard by the judge on 23 July immediately after the conclusion of...
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