Plantation Holdings (FZ) LLC v Dubai Islamic Bank PJSC [2013] EWCA Civ 1229

Case No A3/2013/2690[2013] EWCA Civ 1229
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN’S BENCH DIVISION COMMERCIAL COURT
Mr Justice Flaux
2010 Folio 1157; 2013 Folio 1058
Venue Royal Courts of Justice, Strand, London, WC2A 2LLDate Tuesday 15 th October 2013
Before
LORD JUSTICE MOORE-BICKLADY JUSTICE GLOSTERLORD JUSTICE RYDER
Between
PLANTATION HOLDINGS (FZ) LLCAppellant / ClaimantDUBAI ISLAMIC BANK PJSCDefendants / RespondentsDUBAI ISLAMIC BANK PJSCClaimants(1) PSI ENERGY HOLDING COMPANY BSCDefendants(2) RYAN CORNELIUSDefendant(3) CHARLES RIDLEYDefendant(4) EREN NILDefendant(5) CCH EUROPE GMBHDefendant
(Transcript of the Handed Down Judgment ofWordWave International LimitedA Merrill Communications Company165 Fleet Street, London EC4A 2DYTel No: 020 7404 1400, Fax No: 020 7831 8838Official Shorthand Writers to the Court)
Stuart Cakebread and Juliette Levy (instructed by Miramar Legal) for AppellantRobert Anderson QC and William Edwards (instructed by Hogan Lovells International LLP) for Respondent
Judgment

Introduction

[1]This is the judgment of the court. It sets out the reasons why, on Friday, 27 September 2013, we gave the appellant, Plantation Holdings (FZ) LLC ("Plantation"), the claimant in action 2013 Folio 1058 ("the second action"), permission to appeal against an order of Flaux J dated 13 September 2013, but dismissed Plantation's appeal.[2]By his order, Flaux J dismissed Plantation's application by notice dated 7 August 2013 for: i) an order under CPR, rule 6.15(1) permitting it to serve its claim form in the second action on the defendant, Dubai Islamic Bank PJSC ("the Bank") by an alternative method, on the Bank's solicitors, Hogan Lovells International LLP ("Lovells"), in London; and ii) an order under CPR rule 3.1(2)(g) and (h) directing that Plantation's claim in the second action be either tried, or consolidated, with the Bank’s existing action 2010 Folio 1157 ("the first action") against five defendants (not including Plantation) ("the Defendants"), the trial of which is due to start on 7 October 2013, and is listed for 12 days, i.e. three Commercial Court weeks) .[3]Although Plantation's notice of application was only issued in the second action, Flaux J’s order was made in both the first and the second actions. Paragraph 1 of Flaux J's order dismissed what was referred to as "the application for Joinder" and directed that, in the event that Plantation were to issue an application for permission to serve the claim form in the second action on the Bank out of the jurisdiction under CPR rule 6.36, such application should be reserved to Flaux J.[4]By notice of appeal dated 17 September 2013 Plantation appealed against: i) what it described as Flaux J's refusal of its application "for consolidation/hearing together/joinder of" the first action with the second action; and ii) Flaux J's refusal to order alternative service of the claim form in the first action on the Bank in London.[5]Plantation's Grounds of Appeal, served on the same date, additionally claimed that:
“4. [Flaux J] also wrongly refused to give a direction that any findings in [the first action] should not bind [Plantation] in [the second action], and in so doing failed to have any or any proper regard for the fact that [Plantation's] right under Article 6 to a fair trial was compromised. 5. The judge also wrongly decided that: a. [Plantation] required permission to serve out of the jurisdiction on [the Bank] when it in fact sought alternative service within the jurisdiction.”
[6]Because of the urgency of this matter, given the fact that the trial of the first action is due to start on 7 October 2013, with a time estimate of three weeks, we effectively heard the appeal itself on the application for permission. For that reason we gave permission to appeal. In ordinary circumstances, it is unlikely that we should have done so.[7]Mr Stuart Cakebread and Miss Juliette Levy appeared on behalf of Plantation; Mr Robert Anderson QC and Mr William Edwards appeared on behalf of the Bank. Mr Anderson made it clear, as he had done below, that:(a) the Bank's solicitors and counsel are instructed to appear only in the first action, in which the Bank is claimant, and not in the second action, in which the Bank is defendant, and which has not yet been served on the Bank; and(b) that nothing said or done at the hearing amounted to a submission to the jurisdiction by the Bank in the second action.[8]Mr Max Mallin, counsel representing the first and second defendants in the first action, appeared at the start of the hearing to inform the court of the following matters: i) that the first and second defendants maintained their position of opposing Plantation’s application and were content to adopt the position taken on the appeal by the Bank; and ii) that there had been a delay on the part of the first and second defendants in complying with an order of Popplewell J dated 26 July 2013 for service of expert reports by 6 September 2013, but, as was agreed with the Bank’s legal representatives, the consequences of that delay would not lead to any adjournment of the start of the trial of the first action. In those circumstances, the court released Mr Mallin from any further attendance at the hearing.

Background to the two actions

[9]The Bank is a public joint stock bank incorporated in and under the laws of the Emirate of Dubai ("Dubai") and is 30% state-owned.[10]Plantation is also incorporated in and under the laws of Dubai. It was incorporated to carry through a project, known as the Plantation development, which was to build on land in Dubai a world-class polo and equestrian centre, adjacent to a very substantial luxury villa development. Plantation was assigned a lease of the land by its sole beneficial owner and manager, a Mr Arthur Fitzwilliam ("Mr Fitzwilliam"), who in turn had acquired a lease from the freehold owners ("the Plantation lease").[11]In the first action the Bank makes various claims against the Defendants (only three of which are actively defending the proceedings). They are the following: i) The first defendant is PSI Energy and Holding Co BSC (“PSI”). It is alleged to be a company owned (indirectly) and controlled by the second defendant, Mr Ryan Cornelius (“Mr Cornelius”). It is defending the Bank’s claim, as is Mr Cornelius, through the same solicitors and counsel. ii) The second defendant is Mr Cornelius. He is currently in prison in Dubai, having been convicted of offences of fraud relating to the Bank’s claims in the first action. iii) The third defendant is Charles Ridley (“Mr Ridley”). He is also currently in prison in Dubai in relation to similar offences. He is also defending the first action, with the assistance of a former solicitor, Mr David Mills. iv) The fourth defendant is Eren Nil (“Mr Nil”). Mr Nil is not actively contesting the proceedings. v) The fifth defendant is CCH (Europe) GmbH ("CCH Europe"). It has played no part in the proceedings, and judgment in default has been entered against it. It was a subsidiary of an English company, CCH International plc (“CCH International”).[12]In the period 2002-2007, the Bank entered into agreements, described as agency agreements, with CCH Europe and CCH International. Under those agreements, the CCH companies were to enter into trade finance agreements with third parties as the Bank’s agent. Over that period, the CCH companies presented documents to the Bank ostensibly showing genuine trade finance agreements, and the Bank advanced approximately US $500 million to the CCH companies. Those funds, or so the Bank thought, were being applied for the purposes of legitimate trade financing.[13]In fact, only about US$150 million was applied to genuine trade finance business, and the rest was, or so the Bank alleges, diverted into Mr Cornelius’s companies. By mid-2007, the amount outstanding (other than in respect of genuine trade finance) was about US$330 million. In circumstances that are not relevant to the present application, the fraud (“the receivables fraud”) came to light. A compromise was agreed, and an agreement called the Restructuring Agreement ("the RSA”) was entered into in August 2007. The agreement is governed by English law (save in so far as inconsistent with the principles of Shari’a law) and is subject to an exclusive English jurisdiction clause.[14]Under the terms of the RSA, CCH Europe agreed to repay about US $501 million in accordance with a repayment schedule. Messrs Cornelius, Ridley and Nil guaranteed this repayment obligation, as well as agreeing to disclose their assets and provide security over, and transfer to, the Bank all proceeds derived from the advances. Mr Cornelius and Mr Ridley were business associates of Mr Fitzwilliam in relation to the Plantation development. It appears that Mr Cornelius may have used proceeds of the receivables fraud to invest in Plantation, albeit that Plantation's case is that the fact that the investment derived from the proceeds of fraud was unknown to Mr Fitzwilliam.[15]Plantation also provided security for the obligations owed to the Bank by the Defendants under the RSA. This included a guarantee by Plantation, which in turn was secured by an agreement called a Conditional Assignment of Lease ("the Conditional Assignment”) in relation to the Plantation lease. Plantation and the head lessor consented to the Conditional Assignment. The Conditional Assignment, unlike the RSA, was subject to Dubai law and jurisdiction. In return, the Bank agreed to waive and compromise any and all claims it had against the Defendants.[16]In 2007, CCH Europe repaid around US $10 million and another party to the RSA repaid a further US $50 million. No other payments were made.[17]In May 2008 Mr Cornelius and Mr Ridley were arrested by the Dubai authorities in connection with the receivables fraud. Shortly thereafter, on 6 June 2008, Mr Fitzwilliam was also arrested by the Dubai authorities in connection with the frauds and imprisoned.[18]In 2008 the Bank took the view that breaches of the RSA had occurred, and served various notices under it. In particular, the Bank served notices on Mr Ridley dated 4 June 2008 and on Plantation dated 9 June 2008. The breach allegedly related to the non-payment by Plantation to the Bank of proceeds from the sales of Plantation villa plots, which, according to Plantation, amounted to some US $4 million. Under clauses 18.1(d) and 18.4 of the RSA, if a breach occurred, and remained unremedied after 15 business days, the Bank would then be entitled to demand immediate repayment of the full sum owing under the RSA. That period would have expired on 6 July 2008.[19]On 9 July 2008, Mr Ridley and Mr Cornelius (despite the fact that they were in prison in Dubai) issued a claim in the Commercial Court seeking a declaration that there was no breach of the terms of the RSA entitling the Bank to declare an event of default and an injunction to restrain the Bank from taking any enforcement steps. Simon J had originally granted that injunction on an interim basis on 6 July 2008, but it was discharged by Tomlinson J on the return date, 14 July 2008, on the ground that, on the evidence then before the court, there was no serious issue to be tried on the question as to whether a breach had occurred.[20]Notwithstanding his incarceration, Mr Fitzwilliam and Plantation were aware of the proceedings, and instructed solicitors, Dentons Wilde Sapte. Quite what instructions were given to those solicitors is unclear, but Tomlinson J’s judgment (at [3]) records this as having been the position:
“I have this morning received certain submissions from Mr Pope on the instructions of Messrs Denton Wilde Sapte who anticipate that, in due course, they may be instructed by Mr Fitzwilliam and Plantation, a company and an individual who appear to have an interest in this matter, but Denton Wilde Sapte are at the moment without instructions.”
[21]Following the alleged unremedied event of default notified on 9 June 2008, the Bank claimed to be entitled to enforce its security rights over Plantation. It did so on 20 July 2008, shortly after the judgment of Tomlinson J, by perfecting the Conditional Assignment and taking control of the Plantation lease. On 20 July 2008 Bank informed Plantation that it had executed the Conditional Assignment and so was now the owner of the Plantation lease. Apparently the Bank took physical possession of the Plantation development in or about November 2008.[22]On 30 July 2008, Dentons Wilde Sapte ("Dentons"), solicitors acting on behalf of Plantation and Mr Fitzwilliam, wrote a five page letter to the Bank's solicitors in Dubai asserting inter alia that the notice of breach dated 9 June 2008 served by Clifford Chance on behalf of the Bank was defective, on the grounds that there had been no breach of the relevant clauses, and/or alternatively that the Bank had acquiesced in such breaches, and that, accordingly, there had been no event of default and the Bank was not entitled to enforce its security over the Plantation lease. The letter claimed that the Bank had unlawfully purported to enforce its security over the Plantation lease and that Plantation and Mr Fitzwilliam would hold the Bank accountable for any losses that either of them suffered as a result of the Bank's wrongful actions, in particular, but not limited to, losses suffered as a result of forced disposal of the lease.[23]Mr Fitzwilliam has asserted in his second witness statement served in connection with the present application that what was done by Dentons was without his or Plantation’s instructions. However, as Mr Anderson submitted, the relevant point for present purposes is that, since mid-2008, Plantation and Mr Fitzwilliam have challenged the basis upon which the Bank purported to enforce its security against the Plantation lease and have been fully aware of the possibility of taking proceedings before the English courts.[24]Thereafter, none of Mr Ridley, Mr Cornelius, or Plantation took any steps to continue or start proceedings against the Bank in this jurisdiction under the RSA.[25]In 2009 the Bank commenced certain proceedings against a number of defendants in Bahrain in connection with the same subject matter as the first action. Mr Fitzwilliam and Plantation were not named by the Bank as defendants to its claim. While still in prison, Mr Fitzwilliam decided to bring proceedings against the Bank in Bahrain, in relation to the Bank's purported enforcement of its security against the Plantation lease, which he started on 23 February 2010. He structured his claims as a counterclaim against the Bank's action and sought to join the Bank's Bahrain proceedings against the other defendants.[26]On 6 October 2010 the Bank itself issued the claim form in the first action against the Defendants (although not including Plantation as a defendant). Its claim is brought both to enforce its contractual rights under the RSA and also in respect of the underlying receivables fraud as a primary claim against PSI, and as an alternative claim in fraud against the other Defendants in the event that they succeed in certain defences advanced by them in relation to the RSA.[27]In April 2011 Mr Fitzwilliam was released from prison in Dubai, having been acquitted - for the second time - by the Dubai criminal court. In 2011, the Bank applied for summary judgment in the first action against the Defendants. Mr Fitzwilliam (notwithstanding that neither he nor Plantation was a party to the first action), at the request of Mr Ridley, made a lengthy witness statement dated 31 July 2011 in opposition to the Bank’s application for summary judgment. Before this Court Mr Cakebread asserted that much which was stated in that witness statement did not accurately reflect Mr Fitzwilliam's actual evidence. The relevant point about this statement for present purposes is, again, that in the summer of 2011 Mr Fitzwilliam, and therefore Plantation, were clearly aware of the existence of the first action and the defences being raised by the Defendants in those proceedings.[28]The application for summary judgment was heard by Hamblen J; see [2011] EWHC 2718 (Comm.). He concluded that, on the evidence before him, the Defendants had defences with a realistic prospect of success, such that the matter should proceed to trial.[29]In early 2012, Mr Fitzwilliam apparently instructed English solicitors, Rubric Lois King, to write to Lovells, the Bank's solicitors in the first action, in connection with the RSA. The letter stated that Mr Fitzwilliam was "reviewing his position as to the various actions he may take in the near future". However no proceedings were issued in England by either Plantation or Mr Fitzwilliam against the Bank at that stage.[30]The Bank’s claim in the first action was originally due to be tried in November 2012, but was adjourned and, as has already been said, is due to start with a 12 day (three week) listing on 7 October 2013.[31]On 19 July 2013, Miramar Legal, Plantation's solicitors, wrote a letter to Lovells summarising a proposed claim by Plantation against the Bank and enclosing draft particulars of claim. These, in brief summary, alleged: i) that the Bank had no entitlement to enforce the security against the Plantation Lease; there been no breach of the RSA by Plantation, or, if there had been any breach, it had been acquiesced in by the Bank; alternatively, as a matter of construction of the RSA, such breach could not have constituted a relevant event of default; accordingly, the Bank had committed a repudiatory breach of the RSA in seizing the Plantation development, when it was not entitled to do so; ii) that, in any event, even if it was entitled to enforce its security, the Bank was in repudiatory breach of the RSA, because it wrongly instigated Mr Fitzwilliam's arrest in Dubai so that it could exercise its security rights and obtain possession of the Plantation development without interference; this wrongly prevented Plantationfrom performing its obligation as guarantor to remedy any breach within the time permitted; and iii) that, under Dubai/U.A.E law the Conditional Assignment did not constitute a valid form of security and consequently, even if all of Plantation's contentions were incorrect,the Bank still had had no entitlement to take possession of the Plantation development.[32]In its letter Miramar Legal sought Lovells' consent on behalf of the Bank to Plantation being joined as a party to the first action under CPR rules 19.2 and 19.4 (2), alternatively to consolidation of the first action with the second action under CPR rule 3.1 (2) (g), alternatively to the trial of both actions at the same time. Perhaps not surprisingly, Lovells responded by letter dated 24 July 2013 rejecting this suggestion, pointing out that Plantation had "inexplicably waited to advance its claim until approximately 2 months before the trial of the [first action was] due to commence." Lovells pointed out that the joinder of Plantation's claim would result in the trial date of the first action being lost and the trial being postponed. Lovells also referred to the fact that Mr Fitzwilliam and Plantation had actively participated in various connected proceedings worldwide and that there had been nothing to prevent Plantation's proposed English claim from being put forward at an earlier stage.[33]Subsequently, by letters dated 30 July and 6 August 2013, Lovells confirmed that it had no instructions on behalf of the Bank to accept service of proceedings in the second action. Plantation issued its claim form, marked "not for service out of the jurisdiction", in the second action on 5 August 2013. As at the date of the hearing before us, Plantation had taken no steps to apply for permission to serve the claim form out of the jurisdiction.

The hearing before Flaux J

[34]As already stated, Plantation issued its application notice on 7 August 2013. The first limb of the application, namely the application for an order for alternative service of the proceedings in the second action on Lovells in London, was heard by Andrew Smith J on 19 August 2013. He adjourned that application and directed that it, together with the application for joinder, should be heard on notice to the Bank.[35]When the matter came before Flaux J, the evidence was to the effect that the parties to the first action had worked extremely hard to ensure that the trial date fixed for the first action of 7 October 2013 could be adhered to; that disclosure had been completed, and factual evidence had been exchanged; and that, although various matters remained to be dealt with between the parties, including expert evidence in respect of Shari'a and UAE Law, they were confident that, although the timing in the run-up to trial would be tight, they would be ready for the first day of the trial, which would start on the fixed date. As I have already said, we were informed by Mr Mallin and Mr Anderson that there had been some slippage in certain aspects of the expert evidence, and that, although this would not lead to any adjournment of the trial, it might necessitate a further two-day hearing in November. The Bank' s evidence also demonstrated that the 12 day timetable would be extremely pressed to accommodate the evidence of fact from up to 12 witnesses and 3 to 4 experts due to be called in the first action, although the schedule was considered to be achievable if the parties were disciplined in their timekeeping. However, the evidence clearly demonstrated that the trial timetable could not accommodate any further parties, witnesses, experts, or issues.[36]On the evidence before him, Flaux J concluded that: i) Since Mr Fitzwilliam had known about the availability of a claim against the Bank since July 2008, there was no reason why he could not have started proceedings against the Bank in this jurisdiction, shortly after his release from prison in April 2011, if not earlier. ii) The fact that Mr Fitzwilliam had been ill, was no reason, in the circumstances, why he could not have instituted proceedings much sooner; his ill health had not precluded him from engaging in other commercial and leisure activities, including litigation, since his release. iii) The fact that Mr Fitzwilliam had wanted to obtain some form of third-party funding for the second action was no excuse for the delay in instituting them; Mr Fitzwilliam was an extremely wealthy man and there had been no bar to him instituting proceedings against the Bank earlier, funded by his own resources. iv) Before any issue of alternative service arose, Plantation had to obtain permission to serve the proceedings in the second action out of the jurisdiction under CPR Parts 6.36; no application had been made for the grant of such permission; only once Plantation had demonstrated that it satisfied the requirements for service out of the jurisdiction, would it be appropriate for the Court to consider whether it was appropriate to make an order under CPR Part 6.15 for alternative service. v) Whilst, as Mr Anderson accepted, an application for hearing the two actions concurrently (which Flaux J referred to as "joinder"), if made much earlier, might have succeeded, subject to the court being satisfied that it had jurisdiction over the relevant claims in the second action, given that the first action was now due for trial in three weeks time, it was simply not appropriate that the parties to the first action should have their attention diverted, by having to deal with the second action in any respect. They were clearly a number of steps that would have to be taken in the second action if it were to be "joined" with the first. vi) The position taken by Mr Cakebread (namely that Plantation, the Bank and the Defendants could be ready for trial of both actions by 7 October) was wholly unrealistic. The reality was that on any view the "joinder" of the second action would add at least a week and possibly two weeks to the length of trial. That would have the inevitable effect that the trial of the first action, due to start on 7 October, would have to be adjourned. vii) Plantation and Mr Fitzwilliam were very much the authors of their own misfortune because they had come to the court so late in the day. The balance was therefore clearly in favour of maintaining the trial date in relation to the first action, and is ensuring that the parties to that trial were not disrupted either in the timing of the trial, its preparation or any other aspect of the case.[37]At paragraph 16 he concluded by saying:
“16. What happens at the end of trial in the light of the findings that I make is another matter entirely and without in any sense pre-judging what might or might not happen in relation to case management in Mr Fitzwilliam’s action at the end of the main trial, it does seem to me there are a number of possible case management orders the court might make to ensure, for example, that there was not duplication of evidence or that the same issue was not litigated twice. For the present, it seems to me that any prejudice that Mr Fitzwilliam and Plantation may suffer by not being joined to this action is obviated by the possible orders that the court might make in due course at the end of the main action and when judgment in that main action is delivered.”

The parties' submissions before this court

[38]In summary, Mr Cakebread submitted as follows: i) Plantation's overriding concern was to have a fair trial of its claim for up to US $2 billion against the Bank in relation to the allegedly wrongful seizure of the Plantation development. ii) There was a considerable overlap between the issues in the two actions; one of the principal issues would be the events relating to, and consequences of, Mr Fitzwilliam's arrest; another was the effect of the seizure of the Plantation lease, in respect of which the Defendants in the first action were claiming that such seizure had extinguished their own debt to the Bank, which was adverse to the interests of Plantation; another was the meaning and effect of the RSA and possibly also the Conditional Assignment. iii) As a result of Flaux J's decision, and his refusal to make the orders sought by Plantation, one of two highly unsatisfactory consequences would follow. Thus: a) either Plantation would be boundde facto or de jure by the court's findings in the first action, in relation to which it would be unable to influence, by representation or participation, the outcome and findings in breach of its Convention rights under Article 6; that was potentially extremely prejudicial as the Defendants would seek to rely upon Mr Fitzwilliam's 2011 statement to further their own claim in the first action that they are entitled to benefit from the seizure of the Plantation lease,which was in direct conflict withPlantation'sown case that the security and/or the seizure was unlawful and invalid; b) alternatively, neitherthe Bank nor Plantation would be bound by the findings in the first action, resulting in potentially the judge in the trial of the second action reaching a different set of factual or legal findings, which might be at direct variance to those in the first action; that was contrary to the overriding objective and the steer given in section 49 (2) of the Senior Courts Act 1981 that the court: “… subject to the provisions of this or any other Act, shall so exercise its jurisdiction in every cause or matter before it so as to secure that, as far as possible, all matters in dispute between the parties are completely and finally determined and all multiplicity of legal proceedings with respect to any of those matters is avoided.” iv) By refusing to make a direction that any findings in the first action should not blind Plantation in the second action, the judge wrongly compromised Plantation's Article 6 rights to a fair trial. Moreover, the indication at paragraph 16 of his judgment that the judge would make case management directions at the end of the trial of the first action, "to ensure, for example, that there was not duplication of evidence or that the same issue was not litigated twice" clearly demonstrated that Plantation would indeed be prejudiced by its inability to participate in the trial of the first action. v) The judge made the fundamental error of attributing too much importance to the interests of the Bank and the Defendants in maintaining the trial date, and too little to the interest of Plantation in having the second action tried at the same time as the first action. Whilst Mr Cakebread accepted that the judge was reasonably entitled to come to the conclusion that, if there were joinder, there would need to be an adjournment of the trial date (because the estimate of 12 days would be exceeded, and the Bank would need time to prepare for the second action, which might have the consequence of the trial going off for nine months to a year), nonetheless the judge was wrong to attach so much weight to the preservation of the trial date of the first action. That was particularly so in circumstances where the Defendants had not suggested that they would be prejudiced in any way by the adjournment.[39]Rightly, Mr Cakebread did not pursue the argument contained in Plantation's grounds of appeal that there was no need for permission to serve out of the jurisdiction to be given, prior to the consideration of an order for alternative service. He rightly accepted that, in a case where leave to serve a claim form out of the jurisdiction is required, that requirement cannot be circumvented simply by an order for alternative service under CPR Part 6.15. That rule is not a freestanding foundation for jurisdiction.[40]In summary, Mr Anderson, on behalf of the Bank, submitted as follows: i) Plantation’s appeal was from a case management decision made by a specialist judge who properly directed himself, made no mistake of principle, and did not exceed the “generous ambit within which reasonable disagreement is possible”, and so permission to appeal should not be granted; see per Asquith LJ in Bellenden v Satterthwaite [1948] 1 All ER 343, at 345; per Simon Brown LJ in Loutchansky v Times Newspapers Ltd [2001] EWCA Civ 92, at [9]; per Chadwick LJ in Royal & Sun Alliance Insurance v T&N Limited [2002] EWCA Civ 1964, at [38]. ii) Plantation's submission that joinder was somehow the default position, was misconceived. Section 49 of the Senior Courts Act 1981 had no application to questions of the sort now before the Court. iii) Plantation's application and skeleton argument failed to appreciate the difference between a series of CPR provisions: a) CPR, rule 19.2 deals with substitution and joinder of parties. Joinder was of no relevance to the present application because Plantation had not applied to be joined as an additional party to the Bank’s action. Instead, Plantation had issued its action, which it seeks to have tried, or consolidated, with the Bank’s action. b) CPR, rule 3.1(2)(g) and (h) (the latter being the true basis of Plantation’s application) deal with consolidation and trial together of actions. Plantation’s application is properly to be regarded as one for trial together of the first and second action, not consolidation, because the Bank is claimant in one action and defendant in the other.. c) However, rule 3.1(2) does not require the Court to order consolidation or trial together, it merely permits it to do so. The question whether it should do so (or not) is a discretionary one. It is a paradigm example of case management. iv) Whilst there was a significant overlap between the issues arising in the first action and those arising in the second action, there were significant points of difference. Moreover, additional issues were raised by Plantation in the second action, which were not issues that arose in the first action. In order for the Bank to address these issues, a considerable amount of further work would need to be done before the Bank could plead its defence. This included the obtaining of further evidence, not only from factual witnesses but also from experts on foreign law. v) The judge was clearly right to give considerable weight to the fact that, if an order were made for the hearing of the trials of the first and second actions to take place together, such order would necessarily result in an adjournment of the October 2013 trial date. That was a highly material consideration given the failure of Plantation to apply until the very eve of trial, in circumstances when (as the Judge found) it could have applied at any point over the past three years. vi) The argument that Plantation's right to a fair trial would be infringed if the two actions are not heard together was simply wrong. Plantation’s action will be tried in due course in the usual way. As Plantation itself contends, the result of the Bank’s action will not give rise to any estoppel against Plantation. It will remain entirely free to litigate its own claim as it wishes. Further, any prejudice to Plantation flowed entirely from its own dilatoriness. The Bank had never suggested that res judicata or an issue estoppel would arise as a result of findings of fact made in the first action. vii) The complaint that the judge failed to direct that Plantation would not be bound by the decision in the Bank’s action was also misconceived. There was no application by Plantation before Flaux J for such an order and Plantation had identified no jurisdictional foundation for such a direction. The court very rarely makes interim declarations and it was impossible to see how such a direction could be made: the rules of law about issue estoppel, etc. could not be disapplied in advance by interlocutory order. viii) The application for alternative service was dependent upon Plantation succeeding in its application for an order that the second action should be heard at the same time as the first action in October 2013. Plantation required permission to serve out of the jurisdiction and the rationale for an order for alternative service disappeared once the court had refused to make any such order for trial of both actions together. ix) The fact that the judge's order will result in separate trials was irrelevant. The alternative was yet further delay to the Bank’s action (the trial of which has already been adjourned once). The Judge’s balancing of those two considerations could not sensibly be faulted. x) Accordingly, permission to appeal should be refused, or, if granted, the appeal should be dismissed.

Discussion and determination

[41]Although we granted permission to appeal, we had no hesitation in dismissing the appeal. Our reasons are as follows.[42]As Chadwick LJ observed in Royal & Sun Alliance Insurance v T&N Limited [2002] EWCA Civ 1964, at [38]. “…this Court should not interfere with case management decisions made by a judge who has applied the correct principles, and who has taken into account the matters which should be taken into account and left out of account matters which are irrelevant, unless satisfied that the decision is so plainly wrong that it must be regarded as outside the generous ambit of the discretion entrusted to the judge.”[43]That is particularly so in relation to a decision made, very close to the trial date of an action, by a specialist judge, in a specialist field, as Simon Brown LJ observed in Loutchansky v Times Newspapers Ltd [2001] EWCA Civ 92, at [9]. Whilst Flaux J was not making any directions of a specialist nature, but merely refusing to order that the two actions should be heard together, he necessarily, as a judge of the Commercial Court, had a keen appreciation of the impact of any adjournment on the parties to the first action, and the likely delay involved, if the trial of the first action had to be postponed not only until the second action was ready for trial, but also until a suitable four or five-week slot could be found for a combined trial of both actions.[44]We turn to examine the arguments put forward by Mr Cakebread in order to see whether he has satisfied any of the criteria which might persuade us to interfere with the order made by Flaux J.[45]First, in our view, there can be no grounds for objection to the judge's refusal to join Plantation or consolidate the two actions. There was no application by Plantation to be joined to the first action as an additional defendant, or as a party to the counterclaim, pursuant to CPR rule 19.2. Nor was consolidation of the two actions appropriate, because the Bank is claimant in the first action and defendant in the second action.[46]Second, as the judge accepted, if Plantation's application had been made very much earlier, there might well have been strong grounds for the trial of Plantation's action being heard at the same time as the trial of the first action. However, given the lateness of the application, there can, in our judgment, be no criticism of Flaux J’s decision not to disrupt the trial date of the first action in October 2013, and not to postpone it for nine months or a year, so as to allow the two actions to be heard together at some future date in 2014.[47]It was clear that, if the two actions were to be tried together, that could not happen in October 2013. Additional issues arose in the second action which did not arise in the first action, and in relation to which the Bank would need to have time in which to make further investigations and obtain further disclosure and evidence; those additional issues included the alleged invalidity of the Conditional Assignment as a matter of Dubai law, the valuation of the Plantation development, and Plantation's claim for loss of profits. Irrespective of whether Plantation (as it claimed) was ready to participate in a trial of both actions in October 2013, it was clear that the Bank could not be ready for trial of the second action by then, even assuming in Plantation’s favour that it would expeditiously obtain orders for leave to serve the second action on the Bank out of the jurisdiction and for alternative service within the jurisdiction.[48]Moreover, since a trial of the second action together with the first action would necessarily lengthen the trial period from three weeks, to four or five weeks, the likelihood was that a combined trial of both actions, if the case was re-fixed, could not take place until the 2014 Michaelmas term. As Mr Cakebread accepted in oral argument, he could not criticise the judge's conclusion that, if the first action and the second action were to be tried together, there would necessarily have to be an adjournment of the October 2013 trial date for some nine months to a year.[49]The judge was clearly entitled, in the exercise of his discretion, to afford considerable weight to the interests of the Bank and of the Defendants in having the trial date of the first action maintained. That was particularly so in circumstances where, as the judge found, the evidence showed that Plantation had had every opportunity to bring proceedings against the Bank, or to apply to join the first action, at least from the date of Mr Fitzwilliam's release from prison in April 2011, if not before. The Bank had a clear interest in the timely recovery of the substantial sums which it claimed that the Defendants were liable to pay or repay and to have its action, started in 2010, tried at the first possible date, particularly in circumstances where the first trial date in 2012 had been adjourned. Clearly any delay might prejudice the Bank in the execution of any judgment which it ultimately obtained. Whilst it appeared from correspondence that the Third Defendant might have been content for the trial of the first action to be adjourned, as we have already mentioned, the position of the First and Second Defendants was the same as the Bank, and they were concerned to have the October 2013 trial date maintained. Indeed we were told in argument by Mr Cakebread, that there was some suggestion that the Second and Third Defendants might have their prison sentences reduced or increased depending on whether their claims in the first action (namely that their liabilities had been discharged by the Bank's execution of its security over the Plantation lease and the seizure of the Plantation development) were successful. Moreover, given the imminence of the trial date of the first action, there would inevitably have been a considerable wastage of preparation time, costs and effort, if the trial date had been adjourned. There was thus every reason for the judge to give considerable weight to the interests of the Bank and the Defendants, as parties to the first action, in having the trial date maintained.[50]Third, in circumstances where Plantation had delayed for so long in issuing its proceedings in the second action, and in making its application for the trials to be heard together, the judge, in our view, cannot be criticised for attaching little or less weight to the desire of Plantation and Mr Fitzwilliam to have both actions heard together. There was simply no foundation for Mr Cakebread's argument that as a result of the judge's order, and his "refusal" to make an interim declaration to the effect that any findings in the first action should not bind Plantation in the second action, Plantation could not have, or was at risk of not having, a fair trial of its claim for up to US $2 billion against the Bank in relation to the allegedly wrongful seizure of the Plantation development. In our judgment, that submission was entirely misconceived.[51]Contrary to Mr Cakebread's submission, if Plantation was not a party to the trial of the first action, or not participating in it in relation to the determination of any issues, it is difficult, if not impossible, to see how Plantation "would be boundde facto or de jure by the court's findings in the first action, in relation to which Plantation would be unable to influence, by representation or participation, the outcome and findings in breach of its Convention rights under Article 6..." As Mr Anderson informed us, there was no suggestion on the part of the Bank that Plantation was in some way "privy" to the interests of the other Defendants in the first action, so as to be bound by the judgment in that action, and no case was put forward by Mr Cakebread as authority to support his proposition that the doctrines of res judicata or issue estoppel would somehow bring about that result. Accordingly we reject the argument that the judge's order gave rise to any breach of Plantation's Convention rights under Article 6.[52]We also found it difficult to see what additional prejudice of any real substance would be caused to Plantation as a result of separate trials. It would be a matter for Mr Fitzwilliam to decide whether he chose to appear as a witness in the first action; if he chose to do so, he could no doubt explain the circumstances in which his 2011 statement was given and the respects in which, if any, the contents of that statement were not correct. Whilst, if he did not appear as a witness, it might be that the Defendants would seek to rely upon Mr Fitzwilliam's 2011 statement to further their own claim that the seizure of the Plantation lease discharged all their liabilities to the Bank (which was in direct conflict withPlantation'sown case that the security and/or the seizure was unlawful and invalid), even if the judge accepted the Defendants' claim, that finding would not bind Plantation, as a finding in rem, or have any effect on its assertion that the security and the seizure were unlawful and invalid. Indeed, in neither eventuality, would Plantation be bound by the result of the judge's conclusion in the first action, in circumstances where it did not participate in the trial. The fact that, if Mr Fitzwilliam chose to appear as a witness at the trial of the first action, the judge might make certain findings in relation to his evidence, would merely have the effect that, in the later trial, the Bank and Plantation would have the forensic advantage, or disadvantage, as the case might be, of the evidence which Mr Fitzwilliam had given in the earlier trial; neither, however, would be bound by what had actually been said and the judge in the second trial would be entirely free to come to different conclusions of fact and law on the basis of the evidence presented to him.[53]Of course, the fact that there will be separate trials of the first and second actions does give rise to the possibility that the judge in the trial of the second action might reach a different set of factual or legal findings, which might be at direct variance to those in the first action. That, for obvious reasons, is to a certain extent unsatisfactory, not least because it involves duplication of judicial and court resources; but that consequence is the inevitable result of Plantation's delay in bringing its own application until so shortly before the trial date of the first action. But nether the overriding objective, nor section 49 (2) of the Senior Courts Act 1981, in the circumstances provided any reason to prevent Flaux J from attaching more importance to the interests of the Bank and the Defendants in maintaining the trial date, than to the interest of Plantation in having the second action tried at the same time as the first action.[54]The high watermark of Mr Cakebread's submissions in this context appeared to be based on the comments made by

the judge at paragraph 16 of his judgment that:

“without in any sense pre-judging what might or might not happen in relation to case management in Mr Fitzwilliam’s action at the end of the main trial, it does seem to me there are a number of possible case management orders the court might make to ensure, for example, that there was not duplication of evidence or that the same issue was not litigated twice.”
Mr Cakebread also relied on certain comments made by the judge during the course of argument (for example at pages 18 to 23 and 47 to 49 of the transcript of the hearing) to the effect that the judge would reserve the second trial to himself and that:
"the last thing this court is going to countenance is that there is then a retrial in relation to the same facts on the issues which had been decided. In other words, Mr Fitzwilliam would not be giving evidence twice on that hypothesis….. your [i.e. Plantation's] case can come in for a case management conference at the same time as I deliver judgment [in the first action] and then I can give directions as to what issues remain to be determined that haven't already been determined."
[55]However, these statements have to be viewed against the background that:(a) there was, in fact, no application by Plantation before Flaux J for any interim declaration that no findings made in the first action would amount to res judicata or issue estoppel for the purposes of the second action;(b) it would have been wholly inappropriate, in the circumstances, for any such interim declarations to have been made; and(c) in the event, the judge made no case management orders either reserving the trial of the second action to himself, or, to use the judge's words, "to ensure, for example, that there was not duplication of evidence or that the same issue was not litigated twice". Whether, in the light of Flaux J’s findings in the first action, and the issues which arise for determination in the second action, it will be appropriate for Flaux J to reserve the trial of the second action to himself, is a matter which cannot be predicted at this stage. It might, for example, be inappropriate for Flaux J to be the trial judge of the second action, in circumstances where Plantation or the Bank is urging the trial judge in the second action to arrive at different conclusions of fact or law from those reached by Flaux J in the first action. Likewise, whether the court has the power to give, or it is appropriate for it to give, case management directions in relation to the determination of the issues in the second action, of the type envisaged by Flaux J at paragraph 16 of his judgment, is an issue that only arises as and when any such case management directions are actually made at the conclusion of the first action. But these are all matters for a later date.[56]For these reasons, none of the arguments put forward by Mr Cakebread provided any basis for this court to conclude that Flaux J applied the wrong principles, took into account matters which should not have been taken into account, or left out of account any matters which were relevant. Nor did any of Mr Cakebread's arguments persuade us that Flaux J’s decision was wrong, let alone plainly wrong. On the contrary, the judge’s decision was clearly right.[57]So far as the appeal against the refusal to order alternative service was concerned, Mr Cakebread accepted that Plantation would have to apply for permission to serve the claim form in the first action out of the jurisdiction in the normal way, and, ancillary to that application, make its application for an order for alternative service.

Disposition

[58]Accordingly, for the above reasons, we dismissed Plantation's appeal.

Cited in 4 later judgments