Zoya Ltd v Sheikh Nasir Ahmed (t/a Property Mart)
| Jurisdiction | England & Wales |
| Judge | Mr. William Trower |
| Judgment Date | 28 July 2016 |
| Neutral Citation | [2016] EWHC 1981 (Ch) |
| Docket Number | Claim No HC-2014-001703 |
| Court | Chancery Division |
| Date | 28 July 2016 |
[2016] EWHC 1981 (Ch)
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
Royal Court of Justice
Strand, London, WC2A 2LL
Mr. William Trower QC
(sitting as a Deputy Judge of the High Court)
Claim No HC-2014-001703
Mr Michael Biggs (instructed by Alpha Rocks Solicitors) for the Claimant
Mr Daniel Burton (instructed by Penningtons Manches LLP) for the Defendant
Hearing date: 27 April 2016 Written closing submissions: 9 May 2016
JUDGMENT APPROVED
Introduction
In this action the Claimant, Zoya Limited ("Zoya") seeks an account of what is due from the Defendant, Sheikh Nasir Ahmed ("Mr Ahmed"), in respect of rents collected by him on a number of properties at 157 and 159–161 Earlham Grove, Forest Gate, London E7 9AP ("the Properties") between March 2010 and the date of issue of these proceedings on 16 September 2014. Zoya also seeks payment of the amounts found to be due on the taking of such account.
Zoya was incorporated on 1 July 1982 under the provisions of the Liberian Business Corporation Act. It is the registered owner of the freehold interest in the Properties. Mr Ahmed carries on business as an estate and lettings agent, trading as Property Mart.
The proceedings were issue by Alpha Rocks Solicitors on the instructions of Prince John Adewale Haastrup ("John Haastrup") who has described himself in witness statements variously as the President of Zoya, the sole director of Zoya and the sole shareholder of Zoya. His status as such has been put in issue by Mr Ahmed, who has sought to put Zoya to strict proof of the validity of John Haastrup's purported appointment as its sole director and his authority to act or bring proceedings on its behalf.
John Haastrup claims to be the son and eldest child of the late Dr Captain Israel Ademola Haastrup ("Captain Haastrup"), an eminent Nigerian merchant navy officer and businessman who died in 2012, and whom John Haastrup has described as the founder of Zoya. There is evidence that the question of John Haastrup's paternity is in issue in other proceedings, although I understand that this evidence is itself disputed by John Haastrup.
It is common ground that for a period of time Captain Haastrup was married to Gloria Ngozi Haastrup ("Gloria Llaastrup"), who was not John Haastrup's mother. The question of whether, and if so when, she was divorced from Captain Haastrup is also contentious as between members of the Haastrup family, as is the question of whether or not she and Captain Haastrup were reconciled at some stage prior to his death. Disputes between John Haastrup and Gloria Haastrup in relation to Captain Haastrup's estate are at the root of the issues that have arisen in these proceedings.
On 10 August 2015, Master Matthews made an order that "the issues of whether John Adewale Haastrup is legally entitled to the shares in the Claimant and whether he has validly been appointed, as director of the Claimant be tried as preliminary issues". The only case, which Zoya advances, is that John Haastrup has been the sole shareholder and director of Zoya since the transfer to him of the subscriber shares shortly after incorporation in 1982. This judgment is concerned with the trial of those issues.
There is no documentary evidence dating from the period prior to Captain Haastrup's death, which indicates that John Haastrup had anything to do with Zoya. All of the documentary evidence demonstrates that, prior to his death, the only member of the Haastrup family who acted as an officer of, or with the authority of, Zoya was Captain Haastrup. John Haastrup says that the reason for this is that such documentation as existed disappeared from 157 Earlham Grove when Gloria Haastrup forcibly took over the premises after Captain Haastrup had started divorce proceedings against her in 2007, an issue to which I will return later in this judgment.
Although Zoya's only case was that John Haastrup became its sole shareholder and director shortly after incorporation, the complete absence of any contemporaneous documentation in support of that case means that it is important to have regard to what occurred thereafter. In particular it is necessary to look at the relationship between Mr Ahmed and Captain Haastrup, the circumstances in which John Haastrup met Mr Ahmed after Captain Haastrup's death and the nature of the various assertions that John Haastrup has made as to his interest (and the interest of Zoya) in the Properties.
The Witnesses
The parties adduced expert evidence from Liberian lawyers. The order giving them permission to do so provided for the evidence to be "in the field of Liberian law relating to Liberian Nonresident Domestic Corporations to address issues relating to the preliminary issues". Reports were submitted on behalf of Zoya from Counsellor Frank Musah Dean and on behalf of Mr Ahmed from Dr Laurence Konmla Bropleh.
Although there were a number of respects in which each report lacked precision and focus, neither party contended that the other's expert lacked the necessary expertise. Mr Biggs, who appeared for Zoya, did however submit that Counsellor Dean was better qualified than Dr Bropleh because his firm appeared on the British Embassy's list of Liberian lawyers. Neither expert was cross-examined at trial, but they did submit a short joint statement describing the issues on which they were in agreement.
Each of the experts adopted a rather different approach to the issues on which their evidence was sought, and this divergence was one of the reasons why it was of limited value. However, there were two areas on which it enabled me to reach some conclusions. The first related to the nature of certain presumptions under Liberian law and the second related to the question of how it is that Liberian law identifies the shareholders and director of a Liberian company, including in particular such registration requirements as exist. There is also one aspect of Counsellor Dean's evidence, which is, strictly speaking, evidence of fact not expert opinion, but which is material to the issues I have to decide.
The only witnesses who gave oral evidence at the trial were two witnesses of fact, John Haastrup and Mr Ahmed. Evidence was also adduced in the form of a witness statement from Gloria Haastrup. She was not called to give oral evidence, but her statement wasadmitted pursuant to a hearsay notice, time for the service of which was extended at the beginning of the trial. In assessing the weight and value of her evidence I have taken into account the fact that it was not tested by cross-examination and Mr Burton, who appeared for Mr Ahmed, accepted that for this reason it was of limited value.
Mr Ahmed accepted in cross-examination that Gloria Haastrup was paying for him to defend this litigation, and had supplied him with documentation, which was inconsistent with Zoya's case that John Haastrup was its sole director and shareholder. This formed the basis for a submission that Mr Ahmed was being unduly partial to Gloria Haastrup in his evidence. I do not consider that this was the case. The principal relevance of what he had to say was that he never met John Haastrup before Captain Haastrup's death and that his only dealings in relation to the Properties were with Captain Haastrup and Gloria Haastrup. This was not seriously challenged by Zoya. I am satisfied that Mr Ahmed did his best to assist the court with his understanding of the relationship between Zoya and members of the Haastrup family.
I found John Haastrup to be a much less satisfactory witness. There was more than one occasion on which he sought to embellish his evidence with a description of events that was not foreshadowed in any way in his witness statement. When this occurred the explanations, which he gave for his earlier failure to be full in his evidence lacked credibility. There were also numerous occasions on which, despite Mr Burton's efforts, his evidence simply did not address the questions he was asked and on which I was left with the impression that he was not doing his best to assist the court.
I was also left with the impression that he was giving his evidence with a barely concealed sense of outrage that Mr Ahmed, whom he regarded as an outsider, had the temerity to challenge his control of Zoya and his entitlement to litigate in its name. As will appear, in the absence of some form of corroboration, I have not been able to accept the accuracy of much of his evidence.
The Relationship between Zoya and Mr Ahmed
Mr Ahmed was first engaged by Captain Haastrup in 1996 to administer and collect rent in respect of the Properties, at which stage he identified that the Properties were registered in the name of Zoya. The Land Registry entries showed that registration had occurred either in May 1983 (in the case of 159 and 161 Earlham Grove) or January 1993 (in the case of 157 Earlham Grove). At the time of Mr Ahmed's engagement, he says that Captain Haastrup informed him that he was the sole director of Zoya and that he owned 100% of its shares.
Mr Ahmed and Captain Haastrup then entered into a management agreement dated 30 August 1996 ("the 1996 Agreement"), under which Mr Ahmed acted as managing agent for the Properties. The parties to the 1996 Agreement were Mr Ahmed and Captain Haastrup. Shortly thereafter, in December 1996, Captain Haastrup executed a power ofattorney in favour of Mr Ahmed for the purpose of granting assured shorthold tenancies in respect of the Properties and swearing affidavits and proofs of debt. For a period of almost 14 years thereafter (until June 2010), Mr Ahmed acted under the terms of the 1996 Agreement, and, amongst other things, paid the rental monies into an account in the name of Zoya.
The fact that the 1996...
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