Qatar Investment and Projects Development Holding Company v Phoenix Ancient Art S.A.
| Jurisdiction | England & Wales |
| Judge | Mr Justice Butcher |
| Judgment Date | 04 June 2024 |
| Neutral Citation | [2024] EWHC 1331 (KB) |
| Court | King's Bench Division |
| Docket Number | Case No: KB-2023-003712 & QB-2020-003721 |
THE HON Mr Justice Butcher
Case No: KB-2023-003712 & QB-2020-003721
IN THE HIGH COURT OF JUSTICE
KING'S BENCH DIVISION
Royal Courts of Justice
Strand, London, WC2A 2LL
Laurence Emmett KC (instructed by Pinsent Masons LLP) for the Claimants
Gilead Cooper KC and Francesca Mitchell (instructed by Herrington Carmichael LLP) for the First to Third Defendants
Hearing dates: 15–16 May 2024
This judgment was handed down by the Judge remotely by circulation to the parties' representatives by email and release to The National Archives. The date and time for hand-down is deemed to be 10:00 on Tuesday 4 TH June 2024.
There are three applications before the Court, in two actions which are, subject to the outcome of one of the present applications, to be managed and tried together, namely QB-2020-003721 (‘the Nike Action’), and KB-2023-003712 (‘the New Action’).
These proceedings relate to what are, or purportedly are, ancient artefacts purchased by the First and / or Second Claimants from the First Defendant some ten years ago.
The First Claimant (‘QIPCO’) is a company incorporated under the laws of Qatar. The Second Claimant (‘Sheikh Hamad’) is QIPCO's Chief Executive Officer. The First Defendant (‘Phoenix’) is a company incorporated under the laws of Switzerland which trades as a dealer in art and antiquities. The Second Defendant (‘Ali Aboutaam’) was at all material times the owner of Phoenix with authority from Phoenix in relation to all material matters. The Third Defendant (‘Hicham Aboutaam’) is Ali Aboutaam's brother, and also involved in dealing in art and antiquities. The Fourth Defendant (‘Mr Ansermet’) has not yet been served with the proceedings. He did not appear and was not represented at the hearing. When I refer below to ‘the Defendants’ without specifying otherwise, I mean the First to Third Defendants.
The applications which have been argued and which are to be decided are as follows:
(1) An application by the Defendants to strike out or for summary judgment in the New Action;
(2) An application by the Claimants to restrain proceedings recently brought in the US District Court for the Southern District of New York by Phoenix and a company called Petrarch LLC d/b/a Electrum (‘Electrum’), against QIPCO, Simon Jones Superfreight Ltd (‘Simon Jones Superfreight’), and Phoenix Freight Inc. d/b/a Door to Door Fine Art Services, under Civil Docket No. 24-CV-1699 (‘the New York Proceedings’).
(3) An application by the Defendants for relief from sanctions in the Nike Action.
I will consider those applications in turn, and in the order I have set them out. Before doing so, it is necessary to refer to the, now somewhat involved, procedural history.
Background
The Claimants (or one of them, it being for present purposes immaterial which) bought a chalcedony statuette of a Nike-Victory (‘the Nike’) from Phoenix by a Sale and Purchase Agreement dated 13 May 2013 (‘the Nike SPA’) for US$ 2.2 million. It was purchased on the basis that it dated to 400–500 CE. The Claimants bought from Phoenix a marble head of Alexander the Great as Herakles (‘the Alexander’ or ‘the head’) by a Sale and Purchase Agreement dated 24 January 2014, (‘the Alexander SPA’) for a price of US$ 3 million. It was purchased on the basis that it dated to around the third to first centuries BCE. The Claimants bought from Phoenix a phalera with an imperial eagle made of chalcedony (‘the Phalera’) by a Sale and Purchase Agreement dated 6 June 2014 (‘the Phalera SPA’), for a price of US$ 262,705. It was purchased on the basis that it dated to the first century CE.
On 22 January 2020 the Claimants issued a claim form in QB-2020-000726 (‘the First Alexander Action’), in which Phoenix was named as the only Defendant. In the summary of the claim, it was stated that the Alexander was ‘inauthentic and/or a forgery’. In paragraph 3, it was said that: ‘The claim is for breach of contract and/to enforce and/or claim under the terms of the agreement and/or misrepresentation and/or fraudulent misrepresentation and/or fraud and/or deceit and/or negligence and/or under s. 2(1) and/or 2(2) of the Misrepresentation Act 1967 and/or restitution and/or unjust enrichment and/or mistake and/or money had and received and/or total failure of consideration.’ Before the claim form was served, on 7 May 2020, the words ‘and/or fraudulent misrepresentation and/or fraud and/or deceit’, and all the words after ‘1967’ were deleted. On 26 June 2020, the Claimants issued an application for an extension of time in which to serve the claim form; and on 20 July 2020 Master Gidden made an order ex parte granting an extension of time. That order was then perfected on 22 July 2020. The order extended time by 4 months, to 22 November 2020.
Particulars of Claim in the First Alexander Action were finalised and dated 4 August 2020. They pleaded that the Alexander was inauthentic, and had been ‘manufactured in recent times’. Particulars of this were given. In addition, the Particulars of Claim pleaded what was set out in Schedule 1 to the Alexander SPA as being the provenance of the Alexander, and averred that it was represented that the Alexander had that provenance. At paragraph 19(4) it was pleaded that it was proper to infer that ‘… as the Work is a forgery, the Contractual Provenance is false and inaccurate’, and that ‘… Phoenix did not take sufficient steps to establish … that all relevant export and import laws, licences and regulations pertaining to the Work were complied with …’. At paragraph 21 it was pleaded that representations made by Phoenix, including as to the accuracy of the Contractual Provenance, were made negligently. And at paragraphs 24 and 25 there was pleaded a claim for damages including on the basis of negligence and under s. 2 Misrepresentation Act 1967.
On 8 September 2020, the claim form in the First Alexander Action, together with the Particulars of Claim, were served on Phoenix in Switzerland. Phoenix applied to set aside the order granting the extension of time, and on 19 February 2021 Master Gidden set aside his order extending the time for service; and the action was struck out. The Claimants appealed against that decision, but on 25 August 2021 William Davis J dismissed the appeal. There was a further appeal to the Court of Appeal, which was likewise dismissed, on 30 March 2022: [2022] EWCA Civ 422. In the judgment of Whipple LJ, she said, amongst other things:
‘[3] The six year limitation period for the Claimants to bring a claim against the Defendant for return of the purchase price and damages for associated losses expired on 24 January 2020. Just before expiry, on 22 January 2020, the Claimants issued a claim form. Pursuant to CPR 7.5, the Claimants had four months to serve the claim form within the jurisdiction and six months to serve out of the jurisdiction; if the latter course was taken, the period for service, unless extended, expired on 22 July 2020.
…
[5] On or about 23 June 2020, just before issuing the first application and as a result of enquiries set in train on 16 June 2020, Pinsent Masons had found out that the Foreign Process Section of the High Court (“the FPS”) was closed due to the pandemic. The FPS is the body responsible for serving proceedings outside the jurisdiction. As matters stood at the time of the two applications for an extension, the FPS was closed, it was unknown when it would reopen, there was a large backlog of cases awaiting service outside the jurisdiction, and the FPS was advising litigants who wanted to serve outside the jurisdiction to seek extensions of time for service.
[6] It subsequently emerged that the FPS had been suspended since 16 April 2020. The FPS remained closed, in fact, until 28 July 2020.
[7] The Claimants submitted their application for service out of the jurisdiction to the FPS on 11 August 2020 (although they suggest that the package of documents was ready by 29 June 2020 – nothing turns on the gap between those two dates). The FPS served the Defendant in Switzerland on 8 September 2020, 28 days later and around 7 weeks after the end of the six months permitted for service out of the jurisdiction absent an extension.
…
[9] The Claimants' case in this Court is based on the effects of the pandemic. It is said that the Master (and the Judge) should have made some or greater allowance for the disruption caused by the pandemic. They point in particular to the closure of the FPS from 16 April to 28 June 2020, but also to the general upheaval experienced by businesses at this time, as the pandemic first struck. They argue that the Master should have refused the application to set aside, alternatively the Judge should have upheld the appeal against the Master.
…
[34] The Master found that the FPS's closure was not a reason for the Claimants' application for an extension, because the Claimants required the extension of time for other reasons, unconnected with that closure. The Master held that the reason or reasons for the Claimants' not having served the claim form in time (and thus seeking an extension of time) was the Claimants' failure to grasp the nettle and get on with preparing for service earlier than they in fact did; he noted that they did not even know the FPS was closed until late June 2020, by which time they were already up against the deadline for service of the claim form and already in need of an extension.
[35] Those are the facts as found. It is difficult to see how the Claimants can get around them.
[36] But in any event, I believe there is a fundamental flaw in the Claimants' argument. The Claimants say that the Court should have...
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