Public Institution for Social Security v Al Wazzan and Others

JurisdictionEngland & Wales
JudgeMr Justice Henshaw
Judgment Date05 May 2023
Neutral Citation[2023] EWHC 1065 (Comm)
Docket NumberCase No: CL-2019-000118
CourtKing's Bench Division (Commercial Court)
Between:
The Public Institution for Social Security
Claimant
and
(1) Fahad Maziad Rajaan Al Rajaan
(1) Muna Al-Rajaan Al Wazzan (in her capacity as representative of the estate of Mr Fahad Maziad Rajaan Al Rajaan (deceased))
(2) Muna Mohammed Abdulaziz Al Wazzan
(3) Banque Pictet & CIE SA
(4) Philippe Bertherat
(5) Kamran Amouzegar
(6) Phoenix International Consultants Sarl
(7) Antoine Nasrallah
(8) Pictet & CIE (Europe) SA
(9) Pictet Bank and Trust Limited
(10) Bank Pictet & CIE (Asia) Limited
(11) Mirabaud & CIE SA
(12) Pierre Mirabaud
(13) Thierry Fauchier-Magnan
(14) Luc Argand
(15) Man Group Limited (formerly Man Group Plc)
(16) Man Strategic Holdings Limited
(17) Man Investments Limited
(18) Man Investments AG
(19) Man Investments Middle East Limited
(20) Antoine Massad
(21) Moham mead El Ghazzi
(22) Union Bancaire Privée, UBP SA
(23) UBP Asset Management (Bermuda) Limited
(24) Anne Rotman De Picciotto
(25) Daniel De Picciotto
(26) Francesco Mombelli
(27) ICS Investment Consulting Services SA
(28) Sintesi Limited
(29) Methis Management Limited
(30) EFG Bank AG
(31) Gilles Guerin
(32) The Estate of Edgar De Picciotto
(33) Guy De Picciotto
(34) Marc De Picciotto
(35) Daniele De Picciotto
(36) VP Bank AG
(37) VP Bank (Schweiz) AG
(38) Renato Ghittini
(39) Ely Michel Ruimy
(40) Aerium Finance Limited
(41) The Pensée Foundation
Defendants

[2023] EWHC 1065 (Comm)

Before:

THE HONOURABLE Mr Justice Henshaw

Case No: CL-2019-000118

IN THE HIGH COURT OF JUSTICE

BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES

KING'S BENCH DIVISION

COMMERCIAL COURT

Royal Courts of Justice

Rolls Building, Fetter Lane,

London, EC4A 1NL

Stuart Ritchie KC and Christopher Burdin (instructed by Stewarts Law LLP) for the Claimant

Tom Weisselberg KC and Kendrah Potts (instructed by Greenberg Traurig LLP) for the First Defendant

Tim Akkouh KC (instructed by PCB Byrne LLP) for the Second Defendant

The Third to Forty-First Defendants did not appear and were not represented

Hearing dates: 20 and 21 March 2023

Draft judgment circulated to the parties: 21 April 2023

Approved Judgment

This judgment was handed down remotely at 10.30am on 05 May 2023 by circulation to the parties or their representatives by e-mail and by release to the National Archives.

Mr Justice Henshaw

(A) INTRODUCTION

3

(B) FACTUAL BACKGROUND

5

(C) LOCATION OF AND CONTROL OVER THE DOCUMENTS

12

(D) THE ENGLISH LEGAL POSITION

14

(E) SWISS LAW

17

(1) Introduction

17

(2) SCPC Articles 69, 73 and 101–108 (pre-trial proceedings and access to file)

18

(3) SCC Article 271 (official foreign activities on Swiss territory)

27

(a) Effect of Article 271

27

(b) Compulsion

31

(c) Documents relating to third parties

41

(d) Impact of MLA requests

43

(e) Territorial extent of Article 271

44

(f) Conclusions

46

(4) SCC Article 273 (trade secrets)

46

(5) SCC Articles 292 and 293 (publication of official files declared secret)

48

(6) Other confidentiality/secrecy provisions

49

(7) The applicants' legal advisers

50

(F) RISK OF PROSECUTION OR OTHER PREJUDICE

51

(G) COMITY EXERCISE OF DISCRETION

53

(H) CONCLUSION

55

(A) INTRODUCTION

1

The Claimant (“ PIFSS”) is a public institution authorised by law to operate the State of Kuwait's social security system and pension scheme. Its primary role is to provide Kuwaiti nationals with insurance for retirement, disability, sickness and death.

2

In these proceedings, PIFSS brings claims for sums totalling in the region of US$874 million, arising from the alleged corruption between 1994 and 2014 of its former Director General, the late Mr Fahad Maziad Rajaan Al Rajaan. That sum is said to represent the known total of unlawful corrupt payments received by Mr Al Rajaan and his associates. The payments are alleged to have been received in violation of Mr Al Rajaan's fiduciary duties to PIFSS (as its most senior officer) and of Kuwaiti public property and anti-bribery laws. PIFSS has identified nine alleged corrupt schemes to date, pursuant to which it says the payments were made and concealed by different groups of defendants.

3

Mr Al Rajaan died on 6 September 2022. By orders made on 26 March 2023 his widow, Muna Al-Rajaan Al Wazzan, who is also the Second Defendant, was appointed administrator ad litem to represent Mr Al Rajaan's estate in respect of these proceedings, and administrator ad colligenda bona to represent his English estate for the purpose of collecting, getting in and receiving that estate, and doing such acts as are or may be necessary for its preservation; and was authorised inter alia to take and do all acts necessary to comply with her disclosure obligations.

4

Ms Al Wazzan is also sued in her own right. PIFSS in its Re-Re-Re-Amended Particulars of Claim summarises the case against her thus:

“PIFSS' primary case is that in relation to all of the Schemes above, Ms. Al Wazzan was used by Mr. Al Rajaan as his nominee, in setting up companies and bank accounts in her name through and/or in to which Secret Commissions were paid. It claims that the acts and omissions carried out by him in her name are acts for which he is liable. She is joined to these proceedings to ensure that PIFSS' obtains effective remedies, including under Article 22 of the Kuwait Public Property Law.”

5

PIFSS alleges that the other defendants, who are mainly financial institution defendants, individual partners or representatives of those institutions and a number of other financial intermediaries and associated corporate vehicles, acted in concert in various combinations to make corrupt payments to Mr Al Rajaan and to assist him to conceal and dispose of such payments.

6

This judgment deals with an application dated 12 January 2023 issued by the First and Second Defendants to resist disclosure and inspection (on grounds other than legal professional privilege) of any documents to which the estate and/or Mr Al Rajaan has or had access which are held by any Swiss-based entity or individual or which are located in (or originating from and obtained under compulsion in) Switzerland. The application thereby aims to restrict the disclosure that would otherwise have to be made pursuant to the Order of Jacobs J made at the first CMC in this case on 9 June 2022. There are two main categories of affected documents:

i) a large file of documents held by the Swiss Federal Prosecutor's Office arising from its investigations of Mr Al Rajaan and Ms Al Wazzan since 2012 (“ the SFPO file”), and

ii) other documents held by Swiss-based entities or individuals, or located in Switzerland, or originating from and obtained under compulsion in Switzerland. These are said to include documents held by a number of third parties, and also documents located at Mr Al Rajaan's/his estate's Swiss properties and/or held by Mr Al Rajaan/the estate and/or otherwise originating in Switzerland.

7

The application is supported by two witness statements from Annabel Thomas of the First Defendant's solicitors dated 12 January 2023 and 6 March 2023; and two reports on Swiss law from Professor Marcel Niggli dated 11 January 2023 and 6 March 2023. PIFSS also relies on a witness statement from its solicitor Martin Walsh dated 27 February 2023; and a report on Swiss law from Professor Mark Pieth dated 22 February 2023. Both of the experts are experienced Swiss lawyers. Professor Niggli has been a professor of criminal law since 1995, and since 2003 has been the principal editor of the most comprehensive commentaries on Swiss criminal law and procedure. Professor Pieth has been a professor of criminal law and criminology since 1993, has worked in private practice, held a senior role for four years in the Swiss Federal Office of Justice, and has co-edited one of the main commentaries on Swiss criminal law. I have considered all these materials very carefully. I also heard argument from counsel over one and a half days, and am very grateful to them for their very cogent and helpful submissions.

8

In summary, the First and Second Defendants (“ the applicants”) resist disclosure and inspection on the basis that: (i) an order for disclosure of the SFPO file or the other documents referred to in § 6(ii) above would expose them and their legal representatives to a real risk of prosecution and sanction under Swiss law; (ii) the Swiss courts have repeatedly refused to remove certain restrictions which apply to PIFSS's access to the SFPO file and, as a matter of comity, the English courts should not undermine the Swiss courts or the mutual legal assistance (“ MLA”) process to which I refer below; (iii) PIFSS will in any event be entitled to obtain copies of documents (and has already received some documents) from the SFPO file if and when documents are remitted by Switzerland to Kuwait pursuant to MLA requests made by the State of Kuwait for the purpose of its own criminal proceedings against the applicants; and (iv) PIFSS could lawfully obtain documents through letters of request pursuant to the Hague Convention on the Taking of Evidence Abroad in Civil or Commercial Matters (“ the Hague Convention”). In consequence, it is said, this court should not exercise its discretion to order disclosure as such an order is not reasonable, proportionate, fair or just and would therefore be contrary to the overriding objective and CPR PD 57AD §§ 2.4 and 6.4.

9

PIFSS's position, in brief outline, is that the evidence does not establish that the disclosure would involve any breach of Swiss law, still less any real risk of prosecution or other relevant prejudice; that the documents are essential for the proper conduct of the present case; that the Hague Convention route would (as has been observed in previous cases) be a slow and unsatisfactory alternative to disclosure; and that, overall, the balance comes down...

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