The Public Institution for Social Security v Muna Al-Rajaan Al-Wazzan (in her capacity as representative of the estate of Mr Fahad Maziad Rajaan Al-Rajaan (Deceased)) and Others

Hearing date: 16 May 2025

Judgment on Amendment and Cross Examination Issues

A: PIFSS v Manamendment

Background

The Claimant, PIFSS, seeks to make amendments to its claim based on Article 102 (2) of the Swiss Penal Code. The claim under Article 102 (2) was first made some time ago, in an early version of PIFSS' Re-Amended Particulars of Claim (or “RAPOC”). It led to a Request for Further Information (“RFI”) served in May 2021, and a response providing Further Information (“FI”) in June 2021. The version of the RAPOC which contains PIFSS' currently pleaded claim, for which permission to amend was given early in the trial which commenced in March 2025, is known as the 7RAPOC: the number 7 representing the number of re-amendments. PIFSS' latest amendments are contained in the draft 8RAPOC, and they incorporate proposed amendments to the FI served in June 2021.

The 15 ^th – 19 ^th Defendants, against whom the application to amend is made, are various companies in the group of companies referred to (for simplicity in the present trial) as “Man”. PIFSS' principal case against Man is that it was knowingly involved in a corrupt scheme whereby secret commissions were paid to the then Director General of PIFSS, Mr Al-Rajaan. The payment of these commissions involved the payment by Man of monies to an intermediary, Mr Mohammad El Ghazzi (the 21 ^st Defendant). Substantial sums were then passed by Mr El Ghazzi to Mr Al-Rajaan. There is a major issue in these proceedings as to whether any relevant individual at Man knew that sums of money were finding their way to Mr Al-Rajaan.

PIFSS' case based on Article 102 (2) is by no means the central argument which PIFSS advances in order to establish liability on the part of Man. Its relevance, as Mr Leslie explained when he opened this aspect of the case, is that it is a route to defeat Man's reliance on a limitation defence said to be available under Swiss law. There is a substantial dispute as to whether Swiss law applies to the claims against the various Man companies. PIFSS' primary case is that Kuwaiti law is the governing law.

Article 102 (2) is in a criminal statute. However, PIFSS contends that an infringement of this Article can give rise to civil liability, although there are substantial issues between the Swiss law experts as to whether that is correct. Those issues do not arise on the present application.

The case on Article 102 was originally advanced in an unparticularised form. It alleged that “those Defendants that are corporate entities will incur criminal liability under Article 102 (2) SPC [Swiss Penal Code] for bribery of a foreign public official … or for money laundering … if the relevant offence was committed in that entity irrespective of the criminal liability of any individual agent or employee, provided that the entity failed to take all reasonable organisational measures that were required to prevent such an offence…”

This led Man to request further information from PIFSS. The relevant question that was asked was as follows:

“Please identify the reasonable organisational measures each Man entity is said to have failed to take so as to prevent the offence of bribery from being committed.”

The answer in the FI originally provided by PIFSS was as follows:

“Pending disclosure, PIFSS's case is that in view of (i) the matters set out at paragraph 157 of the Re-Amended Consolidated Particulars of Claim, which at their lowest evidenced an obvious risk that bribery was taking place, (ii) the strictness of the measures that it would be reasonable to take to prevent bribery of a foreign public official and (iii) the Man Defendants' failure in correspondence at any time to assert that they took such measures, it is to be inferred that such measures were not taken or were not adequate. In Switzerland such measures include:

a. Establishing a code of conduct to be adhered to at all levels of management.

b. Ensuring that such code of conduct includes definitions of corruption with examples and an explanation of how to proceed in clear cases.

c. Rules regarding the recruitment of agents and intermediaries.

d. A point of contact for whistleblowers.

e. Internal monitoring, investigative and sanctioning bodies.

f. Positive incentives, based on labour law to comply with the rules.

g. Continuous evaluation and amendment of the compliance program in line with changing risks and new laws”.

Following disclosure, on 10 May 2024, PIFSS amended the FI so as to delete the words “Pending disclosure”. Mr Smouha KC on behalf of Man makes the fair point that this meant that PIFSS was not advancing a case which was wider than that set out above.

In addition to this RFI concerning bribery, a similar request was made in respect of PIFSS' case advanced under Article 102 (2) in relation to money laundering. This elicited a similar response, although the list following “In Switzerland such measures include” was somewhat different:

“a. Rules for identifying customers including beneficial owners.

b. Increased diligence in unusual circumstances.

c. Notification of suspicions to MROS.

d. Record keeping.

e. Establishing a compliance function.”

PIFSS' written and oral opening of its case at trial included, at least as Man perceived it, a significant widening of its bribery case under Article 102 (2). The parties corresponded on this topic, and in due course this led to a proposed amendment to PIFSS' case as set out in the RFI (to which reference was made in the main body of 8RAPOC). The proposed amendments included the deletion of the Article 102 (2) money laundering case, because (as Mr Leslie explained in his oral submissions on the amendment application) the heart of the Article 102 (2) argument was always about bribery. The payment of bribes was the relevant money-laundering risk, and it was clearer to present the Article 102 case through the sole lens of bribery. Significantly, for present purposes, PIFSS sought to expand the bribery case set out in the RFI by adding the following:

“4A. The inadequacy of such measures is demonstrated in particular by the following:

a. Prior to 1 July 2011, such notices as the Man Defendants had in place did not require that intermediaries be assessed for bribery risks or that due diligence be performed on the basis of such risks.

b. Until the review carried out in the context of the Bribery Act, the Man Defendants:

a. did not (i) identify Mr El Ghazzi as posing bribery risks, or (ii) perform due diligence on him that reflected those risks;

b. allowed Mr El Ghazzi to be accorded special treatment contrary to the normal treatment of intermediaries, despite evidence of potential corruption: paragraphs 157.l.a, 157.l.h and 157.m POC are repeated (the evidence of potential corruption existing for the reasons set out in paragraph 157 POC).

c. The report on Mr El Ghazzi produced ahead of the senior management meeting on 17 July 2012 (the circumstances of which are set out paragraphs 146A-147V POC) was inadequate for the reasons pleaded at paragraph 147N POC.”

Mr Burrell's witness statement

PIFSS' application to amend its RFI (and thereby the RAPOC) in this respect is opposed by Man. The reasons for its opposition were set out in the 7th witness statement of Mr Peter James Burrell, the partner at Willkie Farr & Gallagher (UK) LLP responsible for the conduct of the case. Paragraph 24 of the witness statement summarises the reasons for Man's opposition. Mr Burrell says that the amendments raise issues which would require: (i) additional disclosure; (ii) factual evidence of witnesses who are not giving evidence and who are no longer in the employment of Man in relation to matters going back nearly 25 years; (iii) factual evidence of witnesses who are giving evidence but on discrete new issues which they have not been asked to address in their statements, nor have they had the opportunity to consider documents relating to the period of the focus of the allegations; and/or (iv) expert evidence (including foreign law evidence) in an area of expertise that is not covered by existing experts and on issues on which PIFSS has never sought permission.

Subsequent paragraphs of his witness statement expand upon these various points, and these were relied upon and developed by Mr Smouha in his written and oral submissions. Amongst the matters covered in Mr Burrell's witness statement were the following.

Man's factual and expert evidence was prepared on the basis of PIFSS' pleaded case at the time the evidence was produced. That case was understood to be narrow in scope, focusing on an alleged need to have certain codes of conduct and policies in place. Man took the view that this could properly be responded to through disclosure and its factual...