R v Aaron Leonard Goodman
| Jurisdiction | England & Wales |
| Judge | MR JUSTICE JACK,Mr Justice Jack |
| Judgment Date | 08 April 2008 |
| Neutral Citation | [2006] EWHC 2264 (QB),[2007] EWHC 2427 (QB),[2008] EWHC 617 (QB) |
| Court | Queen's Bench Division |
| Docket Number | Case No: HQ06X02205 AND HQ06X02477,Case No HQ06X02205 |
| Date | 08 April 2008 |
[2006] EWHC 2264 (QB)
IN THE HIGH COURT OF JUSTICE
QUEENS BENCH DIVISION
St Dunstans
Carey Street
London
Mr Justice Ramsay
Case No HQ06X02205
MR C GRAHAM QC and MR M COOK appeared on behalf of the Claimant
MR S BROWNE-WILKINSON and MISS HOLTHAN appeared on behalf of the defendants
I have before me applications by the defendants to discharge a search and seizure order and a freezing order made in two actions in which the claimant seeks interim relief in support of proceedings commenced in Mauritius. Those orders are, first, a Search and Seizure Order against the first and fifth defendants granted by Dobbs J on 27th July 2006, as subsequently amended by Swift J on 7th and 8th August 2006, by Mr Langstaff J on 18th August 2006; and secondly, a worldwide freezing injunction against the defendants granted by Mr Langstaff J on 14th August 2006.
The background to these orders is that proceedings have been commenced in Mauritius by the claimant, Mrs Al-Rawas, who is the wife of Mr Al-Shanfari. Mr Al-Shanfari was at one time a business associate of the second defendant, Sheikh Khalifa, who was formerly the Emir of Qatar, and of the third defendant, Dr Al-Kawari, Sheikh Khalifa's personal adviser. Mr Al-Shanfari, Sheikh Khalifa and Dr Al-Kawari were shareholders in the first defendant, Pegasus Energy Limited (who I will refer to as 'PEL'), a company incorporated in Mauritius operating principally in Southern Africa as a fuel trading and distribution company, in particular in relation to supplying large mines and other businesses in Southern Africa.
One such mine, in the Democratic Republic of the Congo, belonged to another company, Oryx Natural Resources (who I will refer to as 'ONR').
Until March 2003 Mr Al-Shanfari was a director of, and held, a one-third shareholding in PEL. Sheikh Khalifa and Dr Al-Kawari also held one-third shareholdings, and Dr Al-Kawari was a director of PEL together with other persons.
Mr Al-Shanfari resigned his directorship of PEL in March 2003, and subsequently transferred his shareholding to his wife, the claimant.
In February 2005, there was a further issue of shares in PEL, which had the effect of diluting the claimant's shareholding from 33 and a third per cent to less than 0.1 per cent. It is the circumstances which led to that further share issue, and the dilution of the claimant's shareholding, that lie at the centre of the proceedings.
In summary, the position was this: (i) loans were made to PEL by Sheikh Khalifa and associated companies; (ii) those loans were re-called; (iii) PEL sought additional equity in the form of a share issue to replace those sums; (iv) PEL offered the additional shares to its three shareholders, Sheikh Khalifa, Dr Al-Kawari and the claimant; (v) Sheikh Khalifa and Dr Al-Kawari took up the share offer, the claimant did not, and the claimant's shares were then purchased by Sheikh Khalifa; (vi) the shareholding of Sheikh Khalifa, Dr Al-Kawari and the claimant changed from 33 and a third per cent each to a shareholding of 49,996 for Sheikh Khalifa, 25,000 for Dr Al-Kawari and 34 shares for the claimant; (vii) the claimant contends that the circumstances of the share offer give rise to causes of action against the company and the directors.
These events took place in February 2005 and subsequently, on 18th July 2006, the claimant commenced two sets of proceedings in Mauritius, one in the Bankruptcy Division and one in the General Civil Division. Both actions are against PEL, Dr Al-Kawari and six other defendants who were directors of PEL. Sheikh Khalifa is also a party to one of the proceedings —the civil proceedings.
Those proceedings in the Bankruptcy Division alleged various breaches of contract and Mauritius company law regarding the share allotment. Those in the General Division alleged that the share allotment constituted a tort of fraud or negligence and/or various other causes of action.
In the civil claim, damages of US$50 million are sought, and in the Bankruptcy Division, various declarations are sought as to the one-third shareholding.
On 20th July 2006 the claimant made two ex parte applications in Mauritius. The first was an ex parte application made through a praecipe, which is 2590/06, for certain Search and Seizure Orders, and an order to allow accountants at Grant Thornton to carry out a valuation of PEL to assess its value in order that PEL is not devalued in subsequent months.
The second one was an ex parte application made through a further praecipe, which is 2591/06, for Search and Seizure Orders against all the defendants in Mauritius in relation offices in Mauritius, London and South Africa.
On 25th July 2006 the Mauritius Court disposed of these applications by two orders. In respect of the first application, the court declined to grant the relief on an ex parte basis as sought by the claimant. Instead, the court ordered that the application be dealt with on an inter partes basis with notice to the respondents. In respect of the second application, the court limited the ex parte's search order it granted against PEL to its offices in Mauritius, and declined to grant the ex parte search orders against PEL in relation to other offices in London and South Africa. Rather, it listed both the applications come back before it on an inter partes basis, initially, today.
The evidence relied on in the Mauritius Court included two affidavits from Mr Al-Shanfari, his first affidavit in the Search and Seizure Application, and his first affidavit in support of the petition. Those affidavits contain the following statements: first of all, at paragraphs 12-14 of his first affidavit in the Search and Seizure Application, he said this:
"In addition, is also my belief that the share issue which occurred in February 2005 was part of a fraudulent scheme devised and/or negligently participated in by the respondents with the primary purpose of diluting my wife's shareholding in Respondent No 1. I refer in particular to the following features of the share issue which are set out in full in TAS1-P.
"(a) I am not aware of any commercial reason as to why the loans would have been required."
He continued at paragraph 13:
"The lack of information available to support the existence of the loans is I believe suspicious and given Respondent No 1's failure to furnish by wife with any particulars to support these matters, she requires the injunction in the terms sought to address these questions."
Paragraph 14:
"In addition to the above, I also refer to the Respondent's unwillingness to provide my wife with any documentation which would independently verify the existence of the loans in question, and if the loans were indeed advanced, that they were made for a general commercial purpose on commercial terms."
At paragraph 53 of his first affidavit in support of the petition, he said:
"My wife and I had serious misgivings as to whether the loans had ever been made, and if not whether they were simply a scam to make my wife's shareholding in the Respondent No 1 negligible. If the loans were in fact made (which I seriously doubt) we wonder whether they were made at arm's length, what was the purpose of the loans and whether they were made purely for the purpose of creating the debt which would 'require' the share issue."
At paragraph 72 of the first affidavit in support of the petition, he said this:
"This matter arises from what I consider to be a deliberate scam and bogus set of transactions on the part of the Respondents (albeit I believe that at the behest of Dr Al-Kawari, Respondent No 2) to make my wife's shareholding in the company essentially valueless. I cannot, at this stage, say with certainty that the initial loans themselves were bogus (although I strongly suspect that they were), but I am certain that the repayment of the loans via the share issue and share allocation was in fact a scam."
On 27th July 2006 the claimant applied to Dobbs J and was granted a Search and Seizure Order in relation to the premises in London. That order was made in pursuant to Section 25 of the Civil Jurisdiction and Judgments Act 1982 in support of the Mauritius proceedings.
In making that order the claimant relied, as would be expected, in the affidavit of Mr Hassan Khan, the claimant's solicitor, on Mr Shanfari's two affidavits in the Mauritius proceedings to which I have referred. In particular at paragraph 22, he relied on the affidavit in the Search and Seizure Application to establish the necessary extremely strong prima facie case, and, at paragraph 27, to establish the necessary clear evidence that the defendants have in their possession incriminating documents and a real risk of destruction of those documents.
In particular, he said at paragraph 27:
"I would respectfully suggest that individuals who engage in conduct such as:
"(a) deliberately setting up loans/loan documentation designed to create a series of debts (or the appearance thereof) owed by the company to a shareholder (Sheikh Khalifa) and...
To continue reading
Request your trial
-
Sagicor Ins v Crawford
...v. Ansett Transp. Indus. (Operations) Pty. Ltd.UNK(1981), 146 CLR 249; [1981] HCA 75, applied. (2) Al-Rawas v. Pegasus Energy Ltd., [2009] 1 All E.R. 346; [2008] EWHC 617 (QB), applied. (3) BHP Billiton Petroleum Ltd. v. Dalmine SpA, [2003] EWCA Civ 170, dicta of Rix, L.J. considered. (4) B......
-
Bank ST Petersburg and Another (Applicants/Claimants) v Vitaly Arkhangelsky and Another (Respondents/Defendants)
...is likely to be very conservative in its assessment (in the case on which the Defendants relied, Al-Rawas v Pegasus Energy Limited [2008] EWHC 617 (QB) the award was £10,000). The reluctance of the Court to make any award in respect of purely reputational consequences is illustrated by the ......
-
Amey LG Ltd v Cumbria County Council
...Cockburn v Edwards (1881) 18 Ch D 449 , Aerospace Publishing v Thames Water Utilities [2007] EWCA Civ 3, and Al-Rawas v Pegasus Energy [2008] EWHC 617 (QB)and concluded that such fees and expenses were not recoverable as damages. 18. In Cockburn v Edwards , Brett LJ stated, at page 462, "[T......
-
Borealis AB v Geogas Trading SA
...for the claimant in an amount at least equal to the costs of employing them during that time.” See too, Al Rawas v Pegasus Energy [2008] EWHC 617 (QB); [2009] 1 All ER 346, esp. at [22] – [23]; and 4 Eng Ltd v Harper [2008] EWHC 915 (Ch); [2009] Ch 91, esp. at [40]. 148 Insofar as Geogas ......