Mohammmed Idris Jabir v H.a. Jordan & Company Ltd
| Jurisdiction | England & Wales |
| Judge | Harris |
| Judgment Date | 13 December 2010 |
| Neutral Citation | [2010] EWHC 3465 (QB) |
| Date | 13 December 2010 |
| Court | Queen's Bench Division |
| Docket Number | No. HQ09X03499 |
[2010] EWHC 3465 (QB)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Royal Courts of Justice
HIS HONOUR JUDGE Charles Harris QC
(Sitting as a Judge of the High Court)
No. HQ09X03499
Mr. T. Marland (instructed by Waltons & Morse LLP) appeared on behalf of the Claimant.
Miss A. Day (instructed by Reynolds Porter Chamberlain LLP) appeared on behalf of the Defendant.
(As approved by the Judge)
This case concerns the value of a fine pearl which in September of 2008 the claimant, Mr. Jabir, entrusted to the defendants in order to have it set into a ring. Unhappily, it was lost. There is no question of dishonesty on the part of any of the defendants' staff. Liability has been admitted but the parties are in dispute as to the value of the pearl.
The background facts are as follows. In May 2008 the claimant, a 60-year-old international dealer in exceptional quality pearls, who comes originally from Madras but now lives in New York and Kuala Lumpur, was offered a pearl by a Mr. Ruff, an elderly Swiss dealer, with whom he traded for many years, and who has been a long-term business associate of his family. Mr. Jabir went to Zurich to see it. The pearl was just over 13 carats and a slightly flattened button shape of an unusual colour and quality. Mr. Jabir thought it an ideal size for a ring and was attracted to its rare colour and freedom from flaws. He believed it to be a salt water pearl. After negotiations, Mr. Ruff agreed to sell the pearl to him for $500,000, and this agreement between the parties was subject to Mr. Jabir submitting it for certification. The claimant asked Mr. Ruff to deliver the diamond to him in Amsterdam, which was done by courier, without prior payment, and he took it to London where it was satisfactory certified by the Gem Testing Laboratory of Great Britain. Mr. Ruff invoiced him for $500,000 in June and that invoice is not in dispute.
Mr. Jabir in turn contacted Mr. Sathak, a Dubai dealer known to him, and the two agreed to meet. Mr. Sathak flew to London from The Gulf. Mr. Sathak is a leading dealer based in Dubai. After a good deal of negotiation, which Mr. Jabir opened by seeking $800,000 and Mr. Sathak by offering about half that, Mr. Sathak agreed to buy it for $650,000.
Mr. Jabir told Mr. Sathak that he would have the peal mounted as a ring. This involved drilling it and the manufacture of a setting. This work he took to the defendant company, which was a business specialising in the design, manufacture, repair and restoration of jewellery for the trade. It dealt with dealers, not private individuals. It was a concern whose services the claimant had previously used. Mr. Denyer, who describes himself, no doubt accurately, as a “master craftsman”, is its managing director, and he was Mr. Jabir's point of contact. A Mr. Fowler was employed as a jewel setter. The concern is owned by S.J. Phillips Ltd., who are well known Bond Street jewellers and pearl dealers.
It was agreed that an Edwardian style platinum mount with rose diamonds would be made for a cost of something over £3,000. The pearl was given into the possession of the defendants on the 3 rd September 2008, with some other items, and a handwritten receipt was provided which stated, “Intense orangey-pink peal 13.10”. Mr. Denyer explained, “We never note or agree any values … Our only concern is that they do not exceed our insurance cover, which is £500,000” (at that time worth nearly $1 million). There is a dispute about whether the price or value had been mentioned when the pearl was handed over. Jordans were told that it was required for delivery by the 2 nd October.
On the 24 th September 2008 Mr. Denyer told Mr. Maricar, a London gem dealer and associate of the claimant, that it would be ready the next day, and on the 25 th Mr. Denyer saw the pearl and the mount that Mr. Fowler had spent 18 hours making to receive it. However, on the following day the pearl could not be found. Initially both the claimant and the defendants thought it would turn up, but it did not. The police were informed on the 3 rd October and on the 7 th October a “approbation notice” was taken by Mr. Maricar to the defendants and signed by a Mrs. Fisher. It contained a list of items and prices, attributing to the pearl a price of $500,000 which Mrs. Fisher, perhaps surprisingly as she was inter alia a bookkeeper, says that she never read.
The pearl has never come to light. Mr. Jabir was thus unable to fulfil his agreement to sell to Mr. Sathak, and he seeks £650,000 from the defendants for conversion breaching its duty as a bailee pursuant to the Torts (Interference with Goods) Act 1977. The case could also be put in simple negligence or in breach of contract.
The defendants' factual case is that they were never told before the loss and did not know what the claimant had paid for the pearl (which is in dispute) and that they did not know of the sale to Mr. Sathak, which is not. It was not admitted that the claimant bought from Mr. Ruff for $500,000, but not disputed that Mr. Ruff's invoice was genuine, or indeed that there was an agreement to sell for $650,000. The defendants' case went a little further in that it was in fact being contended, though with little zest, that the claimant and Mr. Sathak were not telling the truth to the court. However, there was no desire to allege fraud, which was not pleaded nor directly asserted. Indeed, a direct contention of dishonesty was only put in a formal and undeveloped way at the end of cross-examination, and leave was sought, and was not opposed, late in the trial to serve an amended defence.
In cross-examination of Mr. Jabir it was suggested that there was a suspicious paucity of paperwork disclosed in connection with both agreements for sale. It is certainly true that the claimant did not discover any of his business records (in some ill-defined way connected with a business run by his wife) and there were no Customs or VAT documents such as might perhaps have been expected to come into existence during the pearl's passage from Zurich to London. Various other points were made, in particular that it was not clear from the documents precisely how contra arrangements worked. It was Mr. Jabir's case that the settlement with Mr. Ruff was by a contra arrangement.
However, as I have said, the invoice from Ruff was not disputed as genuine, and I have seen and heard Mr. Jabir who is, and was accepted as being, a long-established and highly experienced pearl dealer, one of only 15 or so people who exist in the world who trade at the highest levels in this commodity. He is internationally recognised as one of the leading experts in pearls and he has traded many important pearls, including some of historical significance and value. He explained to me, entirely credibly, that his was a business in which privacy and discretion, not to say secrecy, were of great importance, and that deals were commonly done face-to-face with other dealers and sealed with a handshake, often without documentation. The ultimate customers of dealers like himself are people of great wealth who will be anxious to preserve their anonymity. He also explained how it was quite possible in practice to pass between countries in the EU carrying a pearl or pearls without any Customs declaration or other formality. I found him a convincing witness. Furthermore, he was well known to the defendants' independent expert, Mr. Peter Truman, a fourth generation London pearl and gemstone dealer, who also travels internationally though not to The Gulf. Mr. Truman described himself as “almost as expert” as Mr. Jabir, whom he regarded as a “very careful buyer”, “astute”, and a man who knew “how to haggle”. He did not hint, let alone suggest, that Mr. Jabir was a man of questionable reputation, but Mr. Truman did find it hard to believe that $500,000 had been paid.
Considering the evidence as a whole, not all of which I have rehearsed, it seems clear that pearls of the highest quality are dealt with by a very small number of astute and experienced men, most of whom will be known to each other and who will have traded or whose families will have traded with each other over many years. They rely upon their considerable personal skill and judgment and they negotiate and deal with each other face-to-face in the light of their hands on evaluation of the goods in question. As used once to be the case in the City of London, they reach agreement with each other by word of mouth and a handshake. Trust in each other is utterly essential, and I think it unlikely that a man would survive, let alone thrive, in this field if he did not justly have the confidence of those he deals with.
Mr. Jabir is clearly a very successful practitioner in his field and I do not accept the defendants' implicit contention that what he was doing here was in effect to conspire with Mr. Sathak, and indeed Mr. Ruff, to assert to the defendants and then pretend to the court that he had a pearl which he had bought for $500,000 and agreed to sell for $650,000 when he had not. Nor do I find that Mr. Sathak, who came to England from Dubai to give evidence, attended court to lie. He gave the court the names of a number of the families whom he buys for and deals with. He said he expected to be able to sell on the pearl for a profit of “a little over 20 per cent.”, which would indicate a price of about $780,000. He was going to sell, he said, to a “royal family in The Gulf”. It was suggested to him that he was being “paid to give evidence”. In the event, I am satisfied that Mr. Jabir only, and not...
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