Various Airfinance Leasing Companies (listed at Schedule A to the Claim Form) (2) ALIF Segregated Portfolio Company (for and on behalf of itself and each of ALIF Segregated Portfolio Company 2, ALIF Segregated Portfolio Company 4 and ALIF Segregated Portfolio Company 5) v Saudi Arabian Airlines Corporation
| Jurisdiction | England & Wales |
| Judge | Peter MacDonald Eggers |
| Judgment Date | 01 November 2021 |
| Neutral Citation | [2021] EWHC 2904 (Comm) |
| Court | Queen's Bench Division (Commercial Court) |
| Docket Number | Case No: CL-2020-000561 |
and
[2021] EWHC 2904 (Comm)
Peter MacDonald Eggers QC
(sitting as a Deputy Judge of the High Court)
Case No: CL-2020-000561
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT
Royal Courts of Justice
Strand, London, WC2A 2LL
Tom Sprange QC and Kabir Bhalla (of King & Spalding International LLP) for the Claimants and Third Party
Giles Robertson (instructed by Norton Rose Fulbright LLP) for the Defendant
Hearing dates: 07 October 2021
Approved Judgment
I direct that no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
Peter MacDonald Eggers QC SITTING AS A DEPUTY JUDGE OF THE HIGH COURT
Peter MacDonald Eggers QC:
Introduction
The Claimants and the Third Party (“the IAFC Parties”) apply for an order for disclosure by the Defendant (“Saudia”) in an action concerning a dispute relating to Lease Agreements over 50 Airbus aircraft. Originally, the leases were between the Third Party as Lessor and Saudia as Lessee. The First Claimants are the current Lessors of the aircraft (to whom the leases were novated by the Third Party) and the Second Claimants are suing in their representative capacity as the parent portfolio company of the Lessors.
The parties' dispute centres around the escalation factors which influence the Basic Rent payable under the Lease Agreements. This dispute translates into a difference between the parties whereby the IAFC Parties allege that Saudia has underpaid some US$38.7 million and Saudia alleges that it has overpaid some US$21.9 million under the Lease Agreements.
The dispute between the parties extends to questions of interpretation of the Lease Agreements and estoppels allegedly based on statements or assumptions which were communicated between the parties.
The IAFC Parties seek disclosure by Saudia in respect of the data held on personal devices, in particular mobile telephones, owned or used by:
(1) Mr Saleh Al Jasser who is now the non-executive Chairman of Saudia's board of directors and had been Director General of Saudia when the Lease Agreements were concluded. Since October 2019, Mr Al Jasser has been and is currently the Transport Minister of the Kingdom of Saudi Arabia.
(2) Mr Abdulrahmen Altayeb who had been Vice President of Fleet Management and Engineering of Saudia from 2014 to 2017 and Vice President of Corporate Communications from 2017 to 2018. It is said that Mr Altayeb was a senior aide to Mr Al Jasser when Mr Al Jasser was Director General.
The IAFC Parties maintain that Mr Al Jasser and Mr Altayeb were critical figures in the negotiation, execution and performance of the Lease Agreements. Indeed, Mr Al Jasser signed all fifty Lease Agreements, as well fifty Novation Deeds, fifty Lease Supplements, fifty Acknowledgements of Assignment of Sub-Lease, and the Side Letter and Memorandum of Understanding dated 8th August 2016, all on behalf of Saudia. Saudia's Disclosure Review Document identifies Mr Al Jasser and Mr Altayeb as custodians in respect of various documents and identify mobile telephones as data sources.
I understand that, according to the fifth witness statement dated 20th August 2021 (at para. 18–22) and the sixth witness statement dated 8th September 2021 (at para. 6–7) made by Mr Robin Springthorpe (of Norton Rose Fulbright LLP, Saudia's solicitors), Mr Al Jasser has a work mobile telephone and a personal mobile telephone. The personal mobile telephone is not generally used for work purposes, although it might be used for work purposes exceptionally. Mr Al Jasser does not believe that the personal mobile telephone contains any relevant material which should be disclosed.
Mr Al Jasser's work mobile telephone which he used when he was Director General of Saudia was owned by Mr Al Jasser but paid for by Saudia. Since October 2019, when Mr Al Jasser became Minister of Transport in the Kingdom of Saudia Arabia, Mr Al Jasser's retained ownership of his mobile telephone (and kept the same telephone number), but the Ministry took over responsibility for paying for the mobile telephone. Every time Mr Al Jasser receives a new mobile telephone by way of upgrade, he deleted the data in the handset to be replaced, transferred the data to his new handset, and provided the old handset to a member of his family.
It is understood that Saudia accepts that Mr Al Jasser's work mobile telephone (which I shall continue to refer simply as Mr Al Jasser's mobile telephone) may contain material relevant to Issues for Disclosure 1, 3, 7, 10 and 11 set out in the Disclosure Review Document. For the purposes of this application, I need not explain what those Issues entail. It is understood that Mr Al Jasser's mobile telephone may include relevant email exchanges (which should also be found on Saudia's email server) and in addition instant messaging communications (such as those used in WhatsApp).
According to para. 25 of Mr Springthorpe's fifth witness statement, Mr Altayeb — who is no longer employed by Saudia — used his mobile telephone (which I understand belongs to Mr Altayeb) to access his email account to conduct business in relation to Saudia's dealings with the IAFC Parties, including the matters in issue in this case, and that therefore all relevant material on his mobile telephone of which he is custodian should be found on Saudia's email servers.
During the oral argument in respect of the IAFC Parties' application for disclosure, the focus was on the data held in Mr Al Jasser's mobile telephone, rather than the mobile telephone of Mr Altayeb. That said, I understand that the IAFC Parties maintained their application in respect of Mr Altayeb's mobile telephone.
The central issue upon this application is whether the Court should grant an order for disclosure against Saudia in respect of the data held on Mr Al Jasser's and Mr Altayeb's mobile telephones and in this respect whether such data are within the control of Saudia.
The application notice issued by the IAFC Parties was for an order to vary the Extended Disclosure already ordered by the Court requiring Saudia to disclose documents relating to the Issues for Disclosure held on the personal devices of Mr Al Jasser and Mr Altayeb. Immediately prior to the hearing on 7th October 2021, the IAFC Parties had formulated their application for alternative orders, namely that (a) an order that Saudia use “best endeavours” to secure the production of the documents held on the mobile telephones by Mr Al Jasser and Mr Altayeb, and to file witness evidence explaining what steps have been taken in this respect, and/or (b) an order that Mr Al Jasser or Mr Altayeb produce their devices to independent IT consultants to be searched for documents.
Therefore, during the hearing on 7th October 2021, the IAFC Parties had essentially restricted their application for an order that Saudia request, or use best endeavours to request, Mr Al Jasser and Mr Altayeb to produce the documents or data held on their mobile telephones, which might well include providing their mobile telephones for review by a nominated IT consultant. I shall refer to this as a “best endeavours” order.
In considering this application, I will address the following issues:
(1) Are the documents held on the mobile telephones within the control of Saudia?
(2) If the documents held on the mobile telephones are not within the control of Saudia, does the Court have the jurisdiction to make a “best endeavours” order?
(3) Should the Court make an order for disclosure or a “best endeavours” order?
Are the documents held on the mobile telephones within the control of Saudia?
CPR rule 31.8 provides that “A party's duty to disclose documents is limited to documents which are or have been in his control”. The rule then proceeds to identify when a party to an action has or has had a document in its control, namely when (a) the document is or was in the physical possession of the party, (b) when the party has or has had a right to possession of the document, and (c) when the party has or has had a right to inspect or take copies of the document. However, these three instances of control are not the only circumstances in which such control may be found to exist ( North Shore Ventures Ltd v Anstead Holdings Inc [2012] EWCA Civ 11, para. 40).
As Mr Tom Sprange QC on behalf of the IAFC Parties pointed out, the same definition is reproduced in paragraph 1.1 of Appendix 1 to CPR Practice Direction 51U (the Disclosure Pilot for the Business and Property Courts).
Para. 1.9 of CPR Practice Direction 51U provides that CPR Part 31 (with certain specified exceptions), and therefore CPR rule 31.8, does not apply to proceedings within the Disclosure Pilot.
However, as Andrew Baker, J observed in Pipia v BGEO Group Ltd [2020] EWHC 402 (Comm); [2020] 1 WLR 2582, at para. 12–13, the term “ control” is barely used in CPR Practice Direction 51U, but it is used (a) to define the meaning of Known Adverse Documents (para. 2.8), (b) to define the documents which a party and a party's legal...
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