The Libyan Investment Authority v Société Générale S.A. & Ors [2017] EWHC 2631 (Comm)

Case No CL-2014-000144[2017] EWHC 2631 (Comm)
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
QUEEN'S BENCH DIVISION
COMMERCIAL COURT
Venue Royal Courts of Justice, Rolls Building, 7 Rolls Buildings, Fetter lane, London EC4A 1NLDate 25/10/2017
Before
MR. JUSTICE TEARE
Between
THE LIBYAN INVESTMENT AUTHORITYClaimant(1) SOCIÉTÉ GÉNÉRALE S.A.Defendants(2) SGA SOCIÉTÉ GÉNÉRALE ACCEPTANCE N.V.Defendant(3) SG OPTION EUROPE S.A.Defendant(4) CODEIS SECURITIES S.A.Defendant(5) WALID MOHAMED ALI AL-GIAHMIDefendant(6) LEINADA INCDefendantPERSON BDefendant
Roger Masefield QC and Edward Cumming (instructed by Enyo Law LLP) for ClaimantAdrian Beltrami QC and Sandy Phipps (instructed by Herbert Smith Freehills LLP) for Defendants 1-4Neil Kitchener QC and Tom Richards (instructed by Mishcon de Reya LLP) for Defendant 5Andrew Hunter QC and Andrew Scott (instructed by William Grace (a trading name of MBC Law Limited)) for Person BHearing Hearing date: 20 October 2017
JudgmentMr. Justice Teare :
[1]In May 2017 very substantial and complex proceedings by the LIA against Société Générale were settled. The proceedings concerned trades between Société Générale and the LIA which the LIA sought to have set aside on the grounds that they had been procured by fraud, bribery and corruption. In settling the claim Société Générale paid US$1 billion to the LIA and issued a public apology to the LIA. The claims against Mr. Giahmi and Person B in the same proceedings were discontinued on terms that Société Générale pay their costs.[2]The LIA has now turned its attention to five sets of transactions (“the Questionable Trades”) with other financial institutions, namely, Bear Sterns (now JP Morgan), Dresdner Bank (now Commerzbank), Credit Suisse and BNP Paribas. The LIA claims that it has reason to believe that Mr. Giahmi may have acted with regard to those transactions in the same way in which he was alleged to have acted with regard to the Société Générale transactions. The LIA wishes to review the documents provided to it by the defendants to the Société Générale action for the purpose of investigating whether to seek to use any such documents for separate proceedings which it may wish to pursue against some or all of the financial institutions associated with the Questionable Trades. It needs the court’s permission to do so because the collateral use prohibition which applies to such documents would prohibit such a review; see Tchenguiz v Grant Thornton [2017] 1 WLR 2809 per Knowles J. at paragraph 29.[3]Société Générale has consented to this review application. Mr. Giahmi and Person B have opposed the review application.[4]Mr. Kitchener, on behalf of Mr. Giahmi, has submitted that the Receiver, who makes the review application on behalf of the LIA, has no power to make it, that only the Libyan State Litigation Department has power to make the application, that the court has no jurisdiction to grant it and that to grant the relief sought would contravene article 8 of the ECHR. If he fails on those submissions then he says that the court ought not, in the exercise of its discretion, grant the relief sought. Mr. Hunter, on behalf of Person B says that there is no reason to connect him with the Questionable Trades and so the application should be refused with regard to his documents.

The Receiver’s powers

[5]After the proceedings against Société Générale had been commenced a dispute arose between different persons claiming to control and represent the LIA. In consequence this court (Flaux J.) made a Receivership Order in July 2015 which enabled the Receiver and Manager to prosecute the LIA’s claim on its behalf. By a subsequent order in September 2017 this court (Flaux LJ, as he had become) made a further Receivership Order which enabled the Receiver and Manager to act on behalf of the LIA with regard to the Questionable Trades. The question which has arisen is whether the Receiver has power to make the present application pursuant to the July 2015 order. It is not suggested that he has power to make it pursuant to the September 2017 order.[6]Paragraph 10 of the July 2015 order provided as follows: “Subject to the other provisions in this Order, the Receiver and Manager shall have the following powers, all to be exercisable at his sole discretion: …………. (b) the power to exercise and enforce all and any rights and powers of the LIA in the name of the LIA with regard to the Property…………. ……….. (l) the power to do all things incidental to the exercise of the said powers; ……….[7]The Property is defined as “the SG Choses in Action” which are themselves defined as “LIA’s choses in action against Société Générale and others that are sought to be enforced by LIA in the SG Action”. The SG action had already been commenced at the time the Receivership Order was made.[8]Thus the question of construction which must be determined is whether the right or power to make this review application is a right or power of the LIA “with regard to” the LIA’s choses in action in the action against Société Générale, Mr. Giahmi and Person B.[9]As with all questions of construction the court must ascertain the meaning which the phrase would reasonably be understood to bear having regard to its context and background.[10]Mr. Masefield, on behalf of the LIA, submitted that the right to seek permission to be released from the collateral use prohibition falls within paragraph 10(b). It is a power which arises in the action against Société Générale; it is a right to apply for an order disapplying the collateral use prohibition which applies to documents disclosed in that action. Alternatively, he submits that the right is a power incidental to the exercise of the Receiver’s powers pursuant to paragraph 10(l).[11]Mr. Kitchener submitted that the right to seek permission to be released from the collateral use prohibition falls within neither paragraph 10(b) nor paragraph 10(l). The proposed use is otherwise than for the purposes of the choses in action in the action against Société Générale.[12]I accept that the right which the Receiver seeks to exercise is a right which arises in the action against Société Générale, for the collateral use prohibition has arisen in that action. I also accept that the proposed use to be made of the documents is not for the purpose of advancing the choses of action in the action against Société Générale but for the purpose of establishing whether the LIA may wish to use any of the documents in separate proceedings against other financial institutions regarding the Questionable Trades. The question, however, is whether the right which the Receiver seeks to exercise is “with regard to the Property”, that is, with regard to LIA’s choses in the action against Société Générale.[13]A usual meaning of the phrase “with regard to” is “in connection with” or “in respect of”. The application to be released from the collateral use restriction can be said to be in connection with or in respect of the choses of action of the LIA in the action against Société Générale because the right to make the application arises in that action.[14]However, the context of the phrase is a Receivership Order which empowers the Receiver to exercise the rights of the LIA to prosecute and enforce the LIA’s claims in the action against Société Générale, an action which had been commenced when the Receivership Order was made. The purpose of the Receiver in making the application in question is not to prosecute and enforce those claims but to investigate whether it may wish to use documents disclosed in that action in claims against other financial institutions. In that context I do not consider that the mere fact that the application is connected with the choses in action against Société Générale (because the application is made in the action against Société Générale) is a sufficient connection. In my judgment the present application is not “with regard to the Property” because it is not directed to prosecuting and enforcing the claims in the action against Société Générale. I do not consider that the phrase “with regard to the Property” in the context of the Receivership Order is reasonably to be understood as encompassing an application the aim of which is to assess whether the Receiver may wish to use documents in support of claims against other financial institutions.[15]That leaves paragraph 10(l) which confers upon the Receiver the power to do all things “incidental to the exercise of the said powers”. The Receiver has exercised the power granted to him by paragraph 10(b) to prosecute and enforce the claims of the LIA against Société Générale. In the course of doing so the Receiver has rendered the LIA and himself subject to the collateral use prohibition. An application to be released from that prohibition can therefore be said to be “incidental” to the exercise of the power which the Receiver has exercised. Where the purpose of such an application is to assist in the enforcement of the LIA’s claims against Société Générale it would undoubtedly fall within paragraph 10(l). The question is whether the application falls within paragraph 10(l) where the purpose of the application is not to assist in the enforcement of such claims but to decide whether the LIA wishes to use documents in support of claims against other financial institutions. I do not consider that it is. The aim and object of the Receivership Order was to enable the Receiver to prosecute and enforce the claims of the LIA in the action against Société Générale, which action had already been commenced when the Receivership Order was made. I do not consider that paragraph 10(l) can reasonably be understood to encompass applications which have a different aim and object, namely, ascertaining whether there are documents which the LIA wishes to use in claims against other financial institutions.[16]For this reason I must dismiss the application.[17]In those circumstances I shall deal with the other jurisdictional challenges as shortly as I can.

The “State Litigation Department” point

[18]Mr. Kitchener submitted that under Libyan law the LIA has no capacity to bring legal proceedings. The exclusive power to conduct legal proceedings in Libya or abroad is vested in the State Litigation Department (“the SLD”). This submission is based upon two provisions of Libyan law which are set out in the witness statement of Mr. Giahmi at paragraphs 54 and 56.[19]Law no.87 of 1971 provides as follows (in translation):
“The State Litigation Department shall represent the State and public corporations and Mu’assasat in relation to the lawsuits filed by or against them before the courts of different types and degrees and before other authorities given legal jurisdiction under the law and in other judicial proceedings. The State Litigation Department may represent companies or establishments whose capital or the majority thereof is owned to the State, as well as other bodies managed by the State in relation to the lawsuits filed by or against them under a decree by the Minister of Justice subject to the approval of the company, establishment or the concerned body. The Head of the State Litigation Department may entrust the legal advisors of the public corporations or Mu’assasat or companies or establishments stated in the above paragraph to handle all or part of the lawsuits filed by or against such bodies or to carry out any of the proceedings pertaining thereto.”
[20]Resolution 226 of 2006 provides as follows (in translation):
“Subject to the competences entrusted with the State Litigation Department, the State Litigation Department shall solely represent the State and its Jehat in the lawsuits filed by or against them before the foreign courts of all types and degrees as well as in arbitration and other foreign disputes.”
[21]Mr. Masefield submitted that these provisions of Libyan law are concerned with the question of representation, not capacity. They provide that the LIA must be represented in legal proceedings by the SLD. The question of representation is a matter for the lex fori and in this jurisdiction the court has authorised the Receiver to conduct proceedings on behalf of the LIA.[22]It is clear that the two provisions of Libyan law upon which reliance is placed are concerned with representation. Both use the word “represent”. Neither mentions the capacity of state bodies to make claims. They both assume that the state body has such capacity and deal with the question who may represent the state body in court.[23]This court has considered the question of representation of the LIA in these proceedings and has decided that the Receiver shall manage “the Property” (the choses in action in the action against Société Générale) “in the name of the LIA”; see clause 1 of the Receivership Order. Thus in this court the Receiver is entitled to represent the LIA. I am bound to give effect to that Order.[24]Mr. Kitchener submitted that the Receivership Order does not vest the LIA with powers that it does not have, that the Receivership Order does not operate in rem, that the Receivership Order cannot deprive the SLD of its exclusive right to conduct litigation on behalf of the LIA and that if it does the SLD should have been made a party to the receivership proceedings and Mr. Giahmi should have the opportunity to apply to have it varied. However, in circumstances where the provisions of Libyan law upon which reliance is placed do not purport to deal with the capacity of the LIA to make a claim and where the question of representation in this court must be a matter for this court I am not persuaded that there is substance in these objections.[25]I therefore do not consider that there is any merit in this point.

Subject matter jurisdiction

[26]Mr. Kitchener submitted that the relief sought is outside the subject matter jurisdiction of the court because the court cannot require a foreigner to produce documents in the jurisdiction concerning business transacted outside the jurisdiction; see Mackinnon v Donaldson Lufkin & Jenrette Securities [1896] Ch 482 per Hoffman J. This submission is misconceived because the order sought does not require Mr. Giahmi to do anything.

Article 8 of the ECHR

[27]Article 8 provides a right to privacy. Orders for disclosure involve a serious invasion of privacy. Mr. Kitchener submitted that the order sought in the present case would involve a serious invasion of Mr Giahmi’s privacy.[28]Mr. Masefield made clear that the persons who would conduct the review of the documents disclosed in the action would be those who had already had access to them, namely, the Receiver and his employees and the legal teams previously engaged. The results of the review, in the form of a note from the legal team recommending whether or not a further application for permission to use disclosed documents in support of a new claim should be made, would be presented to the three individuals who claim to be chairman of the LIA (defined as “the Parties” in the Receivership Order). They have had access to Mr. Giahmi’s documents on the terms set out in Schedule 4 to the Receivership Order. These matters are not set out in the draft order but could be set out if required.[29]In those circumstances I am not persuaded that there would be any invasion of Mr. Giahmi’s privacy beyond that which has already (and properly) taken place. Thus Article 8 would not prevent the order being made.

Discretion

[30]Since I have held that the application must be dismissed because the Receiver has no power to make it I need not consider the question whether, if the Receiver had power to make the application, the application should be granted. But in case I am wrong on the question of the Receiver’s powers I shall consider the question of discretion.[31]It has been established that a party to civil litigation may be released from the prohibition on collateral use where there are special circumstances which justify such release and no injustice would be caused to the other party; see Crest Homes v Marks [1987] AC 829 at 860. Typically, there will be special circumstances where there are conflicting public interests, for example, on the one hand the public interest in enforcing the collateral use restriction in order to encourage the disclosure of material documents in civil or criminal litigation and on the other hand the public interest in facilitating the investigation or prosecution of criminal offences. In the absence of injustice the latter public interest will usually take precedence over the former and constitute special circumstances; see Marlwood v Kozeny [2005] 1 WLR 104 at paragraphs 42, 46, 50 and 52. The particular circumstances of the case must be examined carefully; see Tchenguiz v Director of the SFO [2014] EWCA Civ 1409 at paragraph 66 (iii).[32]In the present case Mr. Masefield submitted that there is a compelling public interest in investigating the potential fraud, bribery and corruption which may have been involved in the Questionable Trades. That public interest outweighs the public interest in encouraging disclosure of material documents in civil or criminal litigation by the enforcement of the collateral use restriction. In his oral submissions Mr. Kitchener submitted that that public interest could not avail the LIA in the present case because the LIA is a private body and not a public body charged with the investigation and prosecution of the criminal offence of fraud.[33]I agree that the LIA is not a public body charged with the investigation and prosecution of fraud, bribery and corruption. However, there is a strong public interest in facilitating the just resolution of civil litigation; see Tchenguiz v Director of the SFO [2014] EWCA Civ 1409 at paragraph 66 (iii). Mr. Masefield drew attention to this public interest in his written submissions. An example of a party being permitted to rely upon documents disclosed in a previous action to support the private rights of the party in subsequent civil litigation is SmithKline Beecham v Generics [2003] EWCA Civ 1109. Mr. Kitchener drew attention to that case in his written submissions. In the present case the LIA wishes to review the documents disclosed in the action against Société Générale for the purpose of investigating whether it may wish to seek to use any of those documents for separate proceedings which it may wish to pursue regarding the Questionable Trades. Any such proceedings, said Mr. Masefield, would be likely to involve a claim to set aside the Questionable Trades on the grounds that they had been procured by fraud, bribery and corruption. I accept that in principle that there is a public interest in facilitating the just resolution of the anticipated claims against other financial institutions. Whether that amounts to “special circumstances” must depend upon a careful examination of all the circumstances of the present case. I do not consider that the LIA can rely upon the proposition established in Marlwood v Kozeny that in the absence of injustice the public interest in the investigation and prosecution of fraud as a criminal offence will usually take precedence over the public interest in enforcing the collateral use restriction because the LIA is not a public body charged with the investigation and prosecution of fraud as a criminal offence.[34]Mr. Kitchener drew attention to several factors which he said were good reasons for not granting the relief sought. I shall try to deal with them all.[35]First, he said that the LIA is unable to show a prima facie case of fraud, bribery and corruption. It merely wished to conduct a roving investigation. That is not the role of the LIA; it is the role of the prosecution authorities. This point overlaps with the point with which I have just dealt. The added ingredient is the complaint that the LIA has not shown a prima facie case of fraud. I agree that it has not. What it has done, to the extent permissible without breaching the collateral use restriction, is to set out its reasons for thinking that Mr. Giahmi was involved in the Questionable Trades; see the statement of Mr. Allen, the solicitor acting for the LIA at paragraphs 42-52. If Mr Giahmi was so involved then it is said that he may have acted in the same way as he was alleged to have acted with regard to the Société Générale transactions; see paragraph 41 of Mr. Allen’s statement. I agree that the existence of a prima facie case would strengthen the LIA’s case for the review permission which it seeks. But given the prima facie case against Mr. Giahmi with regard to the Société Générale transactions (which Mr. Kitchener did not challenge) and the reasons for thinking that Mr. Giahmi was involved in the Questionable Trades I consider that the absence of a prima facie case at this stage is not a sufficient reason for denying the LIA the relief it seeks on the present application. It is however a relevant factor to be borne in mind when considering the exercise of the court’s discretion.[36]Second, Mr. Kitchener relied on the fact that the LIA had voluntarily decided to discontinue its action against Mr. Giahmi with regard to the Société Générale transactions. Mr. Giahmi stated in his witness statement served in response to this application that the discontinuance was a disappointment to him because he expected to have a public judgment vindicating his actions. He has further said that the LIA intended all along to use the disclosed documents for further investigations against him and that if he had known that he would have required an undertaking from the LIA not to do so as a condition of discontinuance. He regards the LIA’s wish to use the documents to search for some new claim against him as outrageous. In those circumstances Mr. Kitchener submitted that “there is no justice in a claimant who has walked away and denied a defendant the opportunity of vindication at trial being permitted to come back and have a second run at his documents.”[37]The suggestion made by Mr. Giahmi that the LIA intended all along to make this application but failed to disclose that intention when it discontinued its action against Mr. Giahmi is based upon the failure by the LIA’s solicitor to deny that suggestion “directly” when it was put to them in correspondence. But Enyo said “we do not accept the conclusions you seek to draw in your letter”. That appears to me to be a denial of the suggestion. Mr. Masefield confirmed the denial in the hearing. He said there was no “nefarious holding back of a further purpose”. There is therefore no evidence in support of the serious allegation made against the LIA.[38]I accept that the present application was probably not expected by Mr. Giahmi. I have considered whether the present application is unfair, or, as Mr. Giahmi puts it, “outrageous”. The application is one which the LIA is entitled to make because there was no settlement between the LIA and Mr. Giahmi of all claims which the LIA may have against him. In those circumstances I am unable to regard the application as unfair, even though it may have been unexpected. For the same reason I am unable to accept Mr. Kitchener’s submission that “there is no justice in a claimant who has walked away and denied a defendant the opportunity of vindication at trial being permitted to come back and have a second run at his documents.” The suggested “second run” is not with regard to the Société Générale transactions but with regard to other transactions.[39]Third, Mr. Kitchener relied upon the Confidentiality Club. That provided for the destruction of the disclosed documents when the action came to an end but when the action came to an end in May 2017 the LIA sought permission to retain the documents for legal and regulatory reasons. Those reasons included the section 2 notice by the SFO. As I have said there is no evidence that the LIA intended all along to make the current application. Nevertheless Mr. Kitchener submitted that the current application is an abuse of process because the LIA seeks to broaden the derogation from the destruction provision which it obtained when the action came to an end. It is unjust to permit the LIA to change its position.[40]It is true that but for the SFO notice the documents may have been destroyed and the present application could not have been made. But that notice was served and in those circumstances the documents had to be preserved. The LIA has not “changed its position”. The documents still have to be preserved because of the SFO notice. What has happened is that in circumstances where, for good reason, the documents are still in existence, the LIA has made the present application. I do not accept that the application is an abuse of process.[41]Fourth, Mr. Kitchener submitted that granting the application may cause serious and irremediable harm to Mr. Giahmi. This submission was based upon the premise that the order sought would allow an “unrestricted” set of people to review the documents including Mr. Breish and Mr. Baruni who are said to be dangerous men with links to Islamist terrorist militia. These points are developed by Mr. Giahmi in his witness statement between paragraphs 39 and 49. However, as I have already noted, it is not the intention to allow an unrestricted set of people to have access to the documents. The limits on those who will conduct the review as explained by Mr. Masefield can be incorporated into the order. The proposed reviewers, essentially the lawyers, have already had access to the documents as have Mr. Breish and Mr. Baruni, though subject to the restrictions set out in Schedule 4 to the Receivership Order. It is proposed that they will simply receive a note containing the lawyers’ recommendation as to whether or not a further application be made to deploy documents in support of further claims. In these circumstances I do not consider that granting the review application may cause serious and irremediable harm. Furthermore, the documents which may give rise to a risk to life or limb are protected by the Confidentiality Club which remains in place.[42]Fifth, Mr. Kitchener says that the LIA will not confirm that it has not already breached the collateral use prohibition. What happened was that Mr. Giahmi’s solicitor stated in correspondence that it was apparent that the LIA had had regard to the documents and asked for an account of the use that had been made of the documents. The LIA’s solicitor replied that the information requested was privileged. I do not consider that this amounts to evidence that documents have been used in breach of the collateral use prohibition. Further, to the extent that regard has been had to the documents in order to make this application that would not be a breach of the prohibition; see Tchenguiz v Grant Thornton [2017] 1 WLR 2809 at paragraph 31 per Knowles J.[43]Sixth, Mr. Kitchener said that there is no evidence of a potentially viable claim against any other financial institution. There is no evidence that the transactions have caused loss and in one case no evidence that the transaction even took place. He appears to be right about these two specific points but it is unlikely that the LIA would incur the considerable costs of investigating the Questionable Trades if they had not caused loss. Even so this is not a case where the LIA has established a prima facie claim against any other financial institution. The position is that the LIA wishes to investigate whether to use any of the disclosed documents for separate proceedings “which it may wish to bring” in relation to the Questionable Trades. There may or may not be further proceedings. In those circumstances the public interest in facilitating the just resolution of civil litigation is not as strong as it would be where there was a prima facie claim which had already been issued. Thus the absence of an actual claim against other financial institutions is a matter to be borne in mind.[44]Mr. Kitchener also suggested that there was no evidence that the Questionable Trades were governed by English law and that the claims might be time barred. But Mr. Masefield referred to evidence that they were governed by English law and with regard to the question of time bar he pointed out that much will depend upon an analysis as to when the LIA could with reasonable diligence have known of the claim.[45]Seventh, Mr. Kitchener said that there is no evidence that the relief sought is necessary. That is true in the sense that there is no evidence that it is necessary for the documents to be reviewed in order to establish a prima facie case. However, since there is a strong public interest in facilitating the just resolution of civil litigation it is sufficient that the review may identify documents which will assist the LIA in proving its case, if and when it brings such a case.[46]Eighth, Mr. Kitchener said that the relief sought is disproportionate in that it is unfocused and extremely wide without any limitation as to the documents which are to be reviewed. I agree that the scope of review is very wide. But Mr. Giahmi is not being asked to do anything. The review is the burden of the LIA’s lawyers. It may be that some documents (such as expert reports on Libyan law, the security situation in Libya and French law) will contain nothing of relevance. But if so the review of such documents will take little time and cannot cause Mr. Giahmi any harm or prejudice. Further, there are a great many documents and I suspect that the LIA’s lawyers could not reliably identify a more focused list of documents to be reviewed without conducting a review of the documents.[47]Ninth, Mr. Kitchener said that the LIA would have no power to obtain an order for pre-action (CPR 31.16) or third party disclosure (CPR 31.17) against Mr. Giahmi being a person outside the jurisdiction. Mr. Masefield did not challenge that submission but said the analogy was not apt. The documents are not being sought from Mr. Giahmi. The LIA already has the documents. However, there is authority for the proposition that the availability of relief under CPR 31.17 is a material factor; see SmithKline Beecham v Generics [2003] EWCA Civ 1109 at paragraph 37. I must therefore bear in mind the unavailability of such relief.[48]Mr. Hunter, on behalf of Person B, also objected to the order sought by the LIA. In essence he submitted that there had never been any suggestion that Person B had any wider role than he or she was alleged to have had with regard to the Société Générale transactions. He said that if there had been any such suggestion it would have been pleaded and it had not been mentioned in the Further Information to which he referred in his oral submissions. In response Mr. Masefield said that Person B did have a wider role with regard to LIA personnel and that that was apparent from the confidential material which could not be set out in the Further Information to which Mr. Hunter referred. He said that there was extensive evidence provided by Person B which was relevant in that regard and would be relevant to the Questionable Trades.[49]Having considered the various matters to which Mr. Kitchener and Mr. Hunter referred me I return to address the question whether there are special circumstances which justify permitting the LIA to review the disclosed documents and whether the making of such an order would cause injustice to Mr. Giahmi or Person B.[50]Permission to review is sought in order to investigate whether there are documents which the LIA may wish to use in support of proceedings regarding the Questionable Trades which the LIA may wish to pursue. That purpose engages the recognised strong public interest in facilitating the just resolution of civil litigation. In principle that is capable of amounting to a special circumstance which makes it appropriate not to enforce the collateral use prohibition with regard to the proposed review. However, in this case it is necessary to bear in mind that the LIA has not shown a potentially viable claim against any other financial institution or a prima facie claim in fraud, bribery and corruption against Mr. Giahmi and Person B with regard to the Questionable Trades. There is as yet no civil litigation with another financial institution. To that extent the case for the order sought is weakened. Nevertheless, there was a prima facie case of fraud, bribery and corruption in the Société Générale case which resulted in Société Générale settling the case for US$1billion and issuing a public apology. Further, there are grounds for connecting Mr. Giahmi with the Questionable Trades and (in the confidential material) for suggesting that Person B’s role was not limited to the Société Générale transactions. These matters may or may not be sufficient if and when the LIA decides to make a claim against another financial institution with regard to the Questionable Trades and seeks permission to deploy documents in such a claim. But the present application is merely to review the documents in circumstances where there is reason to believe that there may be civil litigation with one or more financial institutions. In my judgment the required special circumstances have been shown, notwithstanding the fact there is as yet no civil litigation with any other financial institution. Further, in circumstances where the review is to be conducted by those who have already had access to the documents there is no reason to consider that such a review will or may cause harm to Mr. Giahmi or Person B. The review may lead to further proceedings against Mr. Giahmi and Person B alleging fraud, bribery and corruption but I do not consider that that is prejudice of which justifiable complaint can be made.[51]It is true that the documents could not be sought from Mr. Giahmi pursuant to an application under CPR 31.16 or 17 because he is outside the jurisdiction. But in circumstances where the documents are already in the LIA’s possession and the application is simply to review them I do not consider that the non-availability of applications under CPR 31.16 and 17 requires the review application to be denied if there are otherwise good reasons for making the order sought.[52]It follows that, had I determined that the Receiver had power to make this application, I would have granted it.

Conclusion

[53]The application cannot be granted because the Receiver currently lacks the power to make the application. When providing the draft judgment to the parties it was my intention to dismiss the application. However, the parties’ skeleton arguments provided after receipt of the draft judgment reveal that there is a dispute as to whether the application should be dismissed or adjourned to permit what the Claimant has described as a lacuna in the Receivership Order to be cured. I must therefore hear argument on that issue.

Cited in 3 later judgments