“… a foreign judgment in personam given by the court of a foreign country with jurisdiction to give that judgment in accordance with the principles set out in Rules 47 and 48, and which is not impeachable under any of Rules 52 to 55, may be enforced by a claim or counterclaim for the amount due under it if the judgment is (a) for a debt, or definite sum of money (not being a sum payable in respect of taxes or other charges of a like nature or in respect of a fine or other penalty); and (b) final and conclusive, but not otherwise.” but not otherwise.”
“A foreign judgment may be impeached if the proceedings in which the judgment was obtained were opposed to natural justice.”
“Since the ultimate question is whether there has been proof of substantial injustice caused by the proceedings, it would, in our opinion, be unrealistic in fact and incorrect in principle to ignore entirely the possibility of the correction of error within the procedure of a foreign court which itself provides fair procedural rules and a fair opportunity for remedy. The court must, in our judgment, have regard to the availability of a remedy in deciding whether in the circumstances of any particular case substantial injustice has been proved. However, the relevance of the existence of the remedy and the weight to be attached to it must depend upon factors which include the nature of the procedural defect itself, the point in the proceedings at which it occurred and the knowledge and means of knowledge of the defendants of the defect and the reasonableness in the circumstances of requiring or expecting that they made use of the remedy in all the particular circumstances.”
“The only issue relied upon by the Defendants is the reliance placed by the Dubai Courts on the two expert reports dated18 September 2016 (the ‘First Report’) and20 November 2016 (the ‘Second Report’) which each referred to the superseded Law No. 8 of 1974 when they should have be[en] prepared in accordance with the Law No. 7 of 2012.”
“Whereas the Court decides to delegate an Expert in the Lawsuit pursuant to Article No. (69) of the Evidence Law. … The Court ruled, before adjudicating on the subject matter, to delegate the competent banking expert, who has the next turn on the roster and whose mission is to review the file of the Lawsuit and the documents submitted therein and what may be provided by the litigants of non-denied assets or non-denied photocopies of contracts, correspondence or any other documents as well as regular paper, electronic commercial records, books (in accordance with Article No. (5) of 2006 regarding transactions and E-commerce) paper and electronic correspondence, all within the limits of the Defendant’s accounts with the Plaintiff Bank, subject matter of the Lawsuit, provided that they are executed in Arabic or provided with a certified translation to indicate whether there is a banking relationship between the parties to the Lawsuit or not, and in the first case, it shall indicate the following: - The nature of that relationship and its date and evidence. - The type, date, amount, guarantee, applicant, its capacity, beneficiary and method of benefit of the facilities granted from the Plaintiff Bank to the Defendant. - Interest calculated by the Plaintiff Bank on these facilities and their evidence. - Indicating on whether the Defendant used those facilities, subject matter of the Lawsuit, or not, and the total amounts owed and the accrued interest on them, whether the Defendant paid such amounts or part of them or not. In the first case, indicating the total amount paid by the Defendant or obtained by the bank from the guarantees provided by the Defendant and indicating the total entitlements owed by the defendant added to the contractual interests. The same to whether or not the specified interest on the part of the plaintiff was included in the agreement to obtain such facilities. Indicating whether the interest specified by the plaintiff was included in the agreement to obtain such facilities or not, and indicating on whether the subject matter of Lawsuit amounts is in compliance with the facts of the Lawsuit. Indicating whether the current account in which these facilities were deposited and whether they were deposited in one current account or not. In the first case, the indicating of the total entitlements owed by the Defendant, if any, until the date of closing that account, which the cut-off date for the last transaction is made by the Defendant with the Plaintiff bank in any of those facilities. Provided that the compound contractual interests in all those facilities up to that date are calculated in his account added the delayed interest after closing the account until the date of the dispute’s register on 19.10.2015 furthermore interest shall be calculated at 9% annually, and in the event that each facility is included in separate current accounts, these accounts shall be determined and the account closure rule applied to each account separately in accordance with the previous rules, as well as achieving the Cross Plaintiff’s defense. In general, the account shall be settled between the two parties in order to reach the extent of the eligibility of the Plaintiff bank in its requests and the fulfilment of the requests and defense of the parties to the litigation. It authorized the Expert, in order to perform his task entrusted thereto, to move to any destination it deem to move to, including the state Plaintiff’s headquarters, to review the documents it deems useful in performing the task, and to hear the statements of the litigants and their witnesses without an oath. … and the expert shall taken into account the procedures and deadlines prescribed in the Article No. 81 of the Evidence Law in addition to indicate how to perform this, the parties shall deliver the Expert what they have of exhibits in the hearing of the first meeting and the expert shall fill its report at the specified hearing.”
“Second: Procedures taken by the Expert to Perform the Task and Prepare the Report. Within the limits of the task assigned to us by the honorable Court and in implementation for the provisions of Law No. (8) of 1974 Regulating The Experts before the Courts, Law of Evidence in Civil and Commercial Transactions promulgated by Law No. (10) of 1992 AD, the professional norms and practices, we took the following procedures.”
“4. To return the case to the same expert again in light of the objections raised in the papers, especially, the lack of investigation of the defence of the Counter Defendant or to delegate another expert to perform the same missions.”
“Whereas, it is held that the Trial Court has the power to understand and comprehend the facts of the lawsuit, assess the evidence and exhibits submitted to it, and reason the facts of the lawsuit insofar as its decision is based on plausible grounds [Contestation No. 398 of 2011, hearing dated 3.10.12]. Whereas, based on the foregoing judicial and legal precedents, the facts of the Case – as adequately deduced by the Court based on the entire papers of the Case and exhibits, including the original and supplementary reports of the deputized expert – are represented in that the Claimant Bank granted the Second Respondent Company, at the letter’s request, various banking facilities which included overdraft, trust receipts, and documentary credits, and that the Second Respondent Company continued to pay the outstanding dues to Claimant Bank up to 28.09.2014 (account closure date), on which date the activity of the Respondent Company’s current accounts ceased after the latter became indebted in favor of the Claimant Bank at the time with the amount of AED 142,303,347.42 (UAE Dirhams One Hundred Forty Two Million Three Hundred Three Thousand, Three Hundred Forty Seven and Forty Two Fils). … Whereas, in view of the foregoing, it is established that each of the Third to Fifth Respondents had submitted a continuing personal written guarantee to guarantee the indebtedness payable by the Second Respondent Company in exchange for using the banking facilities in favor of Claimant Bank on 08.12.2010, noting that the said obligation was renewed by them upon re-signing the banking facilities letter dated 14.04.2013; hence, it is admissible for the Claimant Bank to request the Third, Fourth and Fifth Respondents to jointly pay with the Second Respondent Company the amount specified in the operative part of the judgment. Accordingly, the Court impliedly rejects all the substantive pleas previously addressed by it.”
“… did not investigate where and to whom such amounts and banking facilities were issued … did not review the accounts of System Dubai, the account holder, and the projects for which the banking facilities were signed, whether they were letters of guarantee or personal guarantees, and it did not review as well the accounts of System Abu Dhabi … [and] … did not comply with the principles of the accounting profession and did not review or examine at the accounts of System Dubai or System Abu Dhabi and did not examine to whom such facilities were issued and for which projects, knowing that the Director of System Dubai is the Second Appellee and the same Director of System Abu Dhabi.”
“Whereas, regarding the Appellant’s request to deputize a tripartite expertise committee from the Ruler’s Court to perform the assignment set forth in the Explanatory Memorandum and to look into the Appellant’s claims and objections, it is held that the Trial Court has full powers to understand and comprehend the facts of the lawsuit, assess the evidence and exhibits submitted to it, weigh between them and adopt whatever it is satisfied with and disregard otherwise, and has absolute power to assess the activities of the expertise as an element of evidence, and adopt whatever matters it is satisfied with on the basis of the veracity of the grounds upon which they are based in conformity with the facts established in the lawsuit, insofar as its judgment is based on plausible grounds, substantiated by the papers, and reasoned, without being bound thereafter by individually addressing each and every objection raised by the litigant against the expert’s report, since the Court’s adoption of the reasoned report signifies that the Court did not find in the litigants’ pleading anything that would impair the veracity of the conclusion reached in the report and that such pleading is not worthy of addressing beyond what is contained in the report, with the Court’s right to disregard the request of appointing a tripartite expertise committee (Contestation No. 284/2011 Civil – Hearing dated 09.05.2012). Whereas, the Court has found the Case papers and exhibits, including the expert’s reports, sufficient to establish its conviction, and that the expert has discharged of his assignment in a manner that has satisfied the purpose of his appointment within the scope of his assignment indicated in the interlocutory judgment, noting that specific matters which the Appellant requested to be investigated are not related to the subject matter of the Case, namely how the amounts and banking facilities were used, whether there was fraud committed by the Company’s managers and whether the managers’ personal accounts were illegally accessed etc., and other request which are not the subject matter of the Case relating to the banking facilities acquired by the Company and guaranteed by the Appellant.”
“1. The Applicant challenges the challenged judgment for its error in applying the law and its interpretation, which invalidates its conclusion. 2. Deficiency in presentation and examination in its grounds which led to another deficiently in reasoning and flaws in inference. 3. The failure to respond to the pleas submitted by the Applicant contained in the papers of the challenged judgment and the appealed judgment with justifiable reasons sufficient to dismiss them and dismiss their significance, which led to a prejudice to the right of defense.”
“The Claimant argued that the said judgment relied on the report produced by the deputized expert, to the effect that the Respondent Company received miscellaneous banking facilities from the Fourth Respondent Bank, whereupon the Respondent Company became indebted in favor of the Respondent Bank with the adjudged amount, and that the Claimant and Second and Third Respondents guaranteed the First Respondent by way of a continuing personal guarantee with the Fourth Respondent Bank against the use of the said facilities. … The Claimant also invoked inveracity of the expert’s conclusion in the report and that the Fourth Respondent Bank allowed that the credit facilities granted to the Company be used in favor of another company, namely System Construct Abu Dhabi, which is not a party to the Agreement and is not guaranteed by the Claimant. … The Claimant argued that the Bank contravened the conditions of disbursement and the decision of the execution judge by liquidating the letters of guarantee. Therefore, the Claimant requested to appoint a banking expert or a tripartite expertise committee to consider his pleading and to determine entitlement of the Respondent Bank to grant and renew the banking facilities for the benefit of the First Respondent Company in respect of other projects relating to another company, namely (System Construct L.L.C. Abu Dhabi). The Claimant added that the Challenged Judgment declined his substantial pleas and his request to deputize an expert or a tripartite expertise committee on the grounds that the papers of the Case and the report produced by the expert are adequate for the Court to hand down a judgment on the substance of the Case, which renders the judgment defective and necessitates that it be vacated. … The Trial Court has the power to understand and comprehend the facts of the lawsuit, assess the evidence submitted to it, and adopt whatever it is satisfied with and disregard otherwise, and has the power to construe contracts, agreements, and all exhibits in such a manner as it deems best satisfies the intent of the contracting parties, designate the guaranteed debt, and deduce the guarantor’s approval to the continuation of the guarantee. Moreover, the Trial Court has the right to assess the activities of the expert and to adopt his conclusion insofar as it is satisfied with the veracity of his research and considers that the expert has investigated all the points of the dispute in the action. Thereafter, the Trial Court is not bound by individually addressing the exhibits submitted by the litigants or discussing every illegal argument raised or addressing their different arguments and claims and individually replying thereto, insofar as the fact it is satisfied with and evidenced impliedly refutes such arguments and claims. … Whereas the First Instance judgment, upheld by the Challenged Judgment in this respect, compelled the Claimant and the First, Second and Third Respondents to jointly pay to the Fourth Respondent Bank the adjudged amount and the interest based on the grounds mentioned in its recitals to the following effect: … It is evident from the original and supplementary reports produced by the expert, with which the Court is satisfied due to being based on plausible grounds substantiated by the papers, that the facilities, subject matter of the Case, were granted to the First Respondent Company ‘System Construct L.L.C.’, which benefited from the bank guarantees by entering into tenders and having contracting projects awarded thereto; … Hence, the Fourth Respondent Bank has the right to claim the amount paid with regard to the aforesaid letters of guarantee from the value of guarantees and documentary credits, totalling AED 149,132,233.92. On conducting a simple calculation, the Court finds that the amount payable to the Bank on the account closure date, namely 28.09.2014, is as follows: … Whereas, the conclusion reached by the Challenged Judgment, whereby it is established that the Claimant guaranteed the First Respondent and that the Claimant is compelled to jointly repay with the First Respondent the outstanding indebtedness, is valid and plausible; hence, the contention raised against the Challenged Judgment in this respect is unfounded. Whereas, based on the foregoing, the Contestation is bound to be dismissed.”
“In practice, it may happen sometimes that a court appointed expert may exceed the mandate and make certain legal determinations. However, this will not of itself invalidate the Court’s judgment unless the Court relies upon such legal determinations made by the expert without independently satisfying itself that the facts and evidence support the expert’s findings by giving appropriate weight to the evidence submitted by the parties and applying the appropriate legal principles to the issues at hand.”
“The first law regulating experts before the Courts was Federal Law No. 8 of 1974 (‘Law of 1974’) that regulated the procedure for their appointment by the Court, their fees, the manner in which experts are to carry out their assignment (such as meeting the parties, preparing minutes of meetings geld with the parties, preparing the final report, etc.), cross examination of experts by the Court, the Court’s power to adopt or disregard the findings of experts, the creation of a register for experts held by the UAE Ministry of Justice, the criteria to be met for registration of experts, the disciplinary measures that may be taken against experts, etc.”
“Article 4 – Expert commitments The expert shall commit to the following: 1 – Federal Law no. 8 of 2012 on the regulation of expertise before the judicial authorities. 2 – Federal Law no. 10 of 1992 on the evidence in civil and commercial transactions and its amendments. 3 – Cabinet Decision no. 6 of 2014 on the regulation of Federal Law no. 7 of 2012 on the regulation of expertise before the judicial authorities. Article 5 – Main professional values Experts shall commit to the following professional values while performing their job and duties: 1 – Honesty, trust and impartiality. 2 – Integrity and transparency. 3 – Respect of others’ rights. 4 – Cooperation with experts and teamwork in relation to the tripartite committees’ matters. 5 – Commitment to job performance and completion on the set dates. 6 – The expert shall keep a true copy of the original of the reports they elaborate until a final judgment is rendered in the case. 7 – The expert shall preserve the confidentiality of the information that comes to their knowledge during or due to their performance of the tasks entrusted thereto. 8 – The expert shall commit to submitting the expertise reports on the set date to the competent court. Article 6 – Code of professional conduct 1 – To commit to receiving the mission they are entrusted with from the competent court and appear before it on the set dates. 2 – To accomplish the mission entrusted thereto in person and within the scope of this mission. 3 - To perform their duties while adopting the highest standards of quality and competence. 4 – To observe the principles, ethics and practices of the profession. 5 – To exercise due diligence in improving their knowledge, developing their professional skills through education and participation in scientific and training sessions. 6 – To inform the department within one month of any amendment to or change of their address or licensing data.”
“Q. You accept, I think, that the 2012 law has expanded on the duties and requirements imposed upon experts, yes? A. No. It doesn’t expand on the duty, it is rather regulating their work in terms of the regulation for registration was a requirement, it is more detail, but there is no major change in the law about the duties of experts and the old law and the new law are the same. … Q. Yes. The code of conduct was a feature than only came about after the 2012 law, correct? A. Yes, if you want to say codified code of conduct, but always there is a code of conduct, the major principle, duties of the expert contained in the old law and the new law and the conduct maybe just improve – it is nothing new. Q. Is this a fair way of putting it, Mr Al Aidarous: after 2012 the provisions became more detailed as to what was expected of experts? Yes? A. No. No. No. It was simply it is more regulation side, because don’t forget the old law 1974, the country used this law for almost 40 years, it is a natural things, the system will be improved, there is more regulation providing for how to register the expert, about the measures of discipline measure, but it doesn’t change the basic duties of the expert in the old law and the new law are the same.”
“Q. It is correct, isn’t it, that the basic duties an expert owes to the court were the same under the 1974 and 2012 laws? A. 2012 is more advanced and more details. This is what I can say. Q. Yes, more detail – A. - in general Q. - but the basic principles were the same? A. No, there is some principle it is there, but it is more with detail, more with, you know, it is a big difference from 1974 up to the year of 2012, if I am not mistaken, okay? So that is that that big difference. Of course, the new law will be more modern, more details, and that is what I can say about it.”
“Q. … What article 11 does is it sets out, if you like, a code, what is expected of an expert in terms of standards of conduct, yes? A. Yes. Q. Do you see that? My question to you is very simple. This is the first time in the law of 2012 that those standards were expressly put, were expressly written down. Do you agree with that? A. Yes, yes. If you said expressly, yes, agreed, but those duties exist all the time.”
“Mr Lewis: … And your Lordship said to my learned friend, you said there is no requirement to actually refer to a specific law in the report. The Judge: I don’t know, I hadn’t been shown one. Mr Lewis: I have looked through the legislation that we have post 2012 and I accept that there is no such obligation.”
“The Judge: Just so that I am clear, you say it is a serious defect whether or not, as a matter of fact, the expert acted in a way which was consistent with the new law? Mr Lewis: Yes – well, we simply don’t know. The Judge: I think, as I understand your proposition, you are saying that regardless of whether the expert in fact acted in accordance with the new law, the fact that he referred to the old law in his report is itself a serious defect? Mr Lewis: We say that, yes, my Lord. Yes.”
“Dear honourable Experts, Peace be upon you. At first, we would like to extend you our best regards, wishing you continuous success and we would like to inform you that the Judicial Authorities stated the following: - Some Experts’ reports still include the phrase: (This report was prepared in accordance with Federal Law No. (8) of 1974 Regulating Expert Profession) and since Law No. 8 of 1974 was repealed by the issuance of Law No. 7 of 2012, any report that includes this phrase shall be considered null and void. - It was noted that some of the initial reports that are sent to the parties for comment are not signed by the delegated expert, which violates the Evidence Law and its amendments, and therefore please adhere to the correct law. Yours Sincerely, Expert/M.S. Aisha Suleiman Al Ali Director of Technical Experts and Translators Affairs Department.”
“A. … This is a regulatory body of experts and they receive a complaint from the courts that is a separate stating that there are some experts who are still referring to the old law. I think the expert, the Ministry of Justice, the regulatory body, they try to notify to the expert, please abide by the new law, don’t refer to the old law. What the statement is said by the ministry, if you refer to the old law, maybe this is the intention it was it might be or it will be nullified by the court, but the Ministry of Justice have no powers to nullify any expert report. The expert report will be nullified by the court. Q. What you have then is a direction from the Ministry of Justice to the courts as to how they should treat experts’ reports which refer to the 1974 law, isn’t that correct? A. No. This is addressed to the expert, notifying them, ‘Please be careful, use the new law to make a reference’, it is not addressed to the court, it is not the duty of the Ministry of Justice to say to the court what is annulled and the experts is null and void or not, this is the court, this is a court judiciary decision to be made by the court itself. … A. … This is basically a direction to the expert to the intention was to tell them you might be nullified by the court, it is not for the Ministry of Justice to nullify the expert report in the first place.”
“Q. … Suppose, prior to this circular being issued, a judgment relies upon a report referring to the 1974 law, once the time for appealing has passed, such that the judgment is final and binding this law doesn’t retrospectively invalidate the judgment – sorry, this circular does not retrospectively invalidate the judgment? A. The circular is nothing to do to only invalidate. The law by itself is by operation of the law it is invalidated, because the decision based on the expert which is null and void. That is exactly what it – the grounds of that judgment was based on the expert, so if the ground is not there, then it should be like this. Now the way how they can approach the court and how they can do it, that is not part of my legal expert to be very frank, to talk about it. Q. Can we just unpack that? I think your point there was that the 2012 law means that a report that refers to the 1974 law is invalid and that is simply a consequence of the 2012 law. Is that what you are saying? A. Again. Q. Is your evidence that the effect of the 2012 law is that an expert report produced after the 2012 law came into force [that] refers to the 1974 law, it is invalid by virtue of the 2012 law? A. Yes, because that is which is the circular is confirming.”
“Thirdly, where the procedural defect is apparent to the defendant he should use the local remedy of appeal before resorting to the contention in this country that the assessment of his liability was not in accordance with the principles of substantial justice.”
“39. … On the basis of the evidence before us it appears to me that, contrary to the statement of Mr Myers in the later affidavit, it was the duty of the judge to leave the assessment of the damages for the decision of the jury in light of the wide variation in the expert evidence before them. The judge did not do so, with the result that, arguably, the assessment of damages required by the order did not take place. 40. So the question arises whether Mr Leaver should have pursued any remedy in Texas by way of appeal in respect of the failure to observe the requirements of the 1994 order. The judge considered that he should. She said: It is sufficiently obvious, therefore, that if that was a breach of procedure, it was a matter that could be pursued in an appeal in Texas. The procedures that were provided in Texas were in themselves reasonable and the fact that a bond may or may not have been required in order for the defendant to pursue an appeal from a default judgment in Texas does not so far offend the concept of natural justice as to provide any basis for a challenge to the Texas judgement as regards the amount of the actual award of damages. I do not find therefore but any breach of procedure, even assuming there were one, or the availability of means to redress it, had gone so far as to offend the English concept of proper justice and proper procedure. This case is therefore well on the inside of the line as drawn in the Adams v. Cape Industries case as to whether the court will enforce a judgement. Therefore I reject that as a matter supposedly giving rise to a reasonable defence such that leave to defend ought to be given on that score. 41. On the basis of the evidence before us, I would answer the question in the negative. The evidence of Mr Myers was to the effect that the quantum of liability had been assessed by the jury in the normal way. I share the judge’s astonishment at Mr Myers’ evidence as to the course the proceedings took. The true position did not come to light until September 1998. By that time Mr Leaver’s appeal in Texas had long since been dismissed for failure to provide security for costs. I am by no means satisfied that he could at that late stage had re-opened the appeal on the new ground he might then have realised was available.”
“… a transfer at less than full value by an insolvent person is presumptively made for a prohibit[ed] purpose.”
“… a man must be presumed to intend the natural consequences of his own act.”
“The statute of 13 Eliz. C. 5, is not only directed against transfers of property as are made with the express intention of defrauding creditors; but, as has been justly remarked, it extends as well to such as virtually and indirectly operate the same mischief, by abusing their confidence, misleading their judgment, or secretly undermining their interests. To obviate this, it has gradually grown into a practice to regard certain acts or circumstances as indicative of a so-called fraudulent intention in the construction of the Statute, although, perhaps, there was in fact, no actual fraud or moral turpitude. It is difficult, in many cases of this sort, to separate the ingredients which belong to positive and intentional fraud from those of a mere constructive nature, which the law thus pronounces fraudulent upon principles of public policy. To draw any definite invariable line of distinction between moral and technical fraud, on the one hand, or between actual and constructive on the other, would be next to impossible and could rarely serve any useful purpose. But there are certain circumstances, the presence of which has been taken as conclusive evidence of fraud, and as invariably avoiding the conveyance. The ordinary form of this constructive fraud under 13 Eliz. C. 5, is a voluntary conveyance made by a man deeply indebted, which accordingly is void, under the Statute, as against the grantor’s creditors.”
“Save as provided in this section, every conveyance of property, made whether before or after the commencement of this Act, with intent to defraud creditors, shall be voidable, at the instances of any person thereby prejudiced.”
“There is no doubt that the Statute of Elizabeth was available after a man’s death to his creditors to recover from a volunteer property of whatever kind … It was not necessary to prove a fraudulent intent. The mere fact of insolvency was enough: see Lord Hatherley’s judgment in Freeman v Pope. … In my judgment, all this continues to be good law under section 172 of the Law of Property Act”; ii) Lloyds Bank Ltd v Marcan[1973] 1 WLR 339 at 344H (Sir John Pennycuick V.C.): “The word “intent” denotes a state of mind. A man’s intention is a question of fact. Actual intent may unquestionably be proved by direct evidence or may be inferred from surrounding circumstances. Intent may also be imputed on the basis that a man must be presumed to intend the natural consequences of his own act: see the judgment of Lord Hatherley LC and Giffard LJ in Freeman v Pope (1870) 5 Ch. App. 538. I would mention that today this imputation might well be considered applicable where there has been a valuable consideration short of full consideration. I do not, however, propose to pursue that point for this reason. In the present case there is evidence of actual intention. That, of course, is by no means always so in cases under this section. Where there is evidence of actual intention, in the nature of things there is very little room for imputing intention. I do not, therefore, propose to pursue the difficult questions which arise as to the circumstances in which intention may be imputed. See also, dismissing an appeal in the same case, reported at[1973] 1 WLR 1387 , the judgment of Cairns LJ at 1392D-E: “Other cases make it clear that if the conveyance is voluntary it is easier to infer a dishonest intention than when it is made for consideration or even that no dishonest intention need then be established: see Freeman v Pope (1870) 5 Ch. App. 538, Ideal Bedding Co. Ltd v Holland[1907] 2 Ch. 157 , In re Eichholz, decd.[1959] 1 Ch. 708 .”
“The section does not render a transaction voidable unless there is an intent to defraud creditors. Unfortunately, it is not entirely clear what is the meaning of ‘to defraud’ in this context; though it seems that, in practice, the requisite inference of fraud will be drawn whenever the necessary consequences of the transaction is to defeat, hinder, delay or defraud the creditors or to put assets belonging to the debtor beyond their reach. Where the requisite intention is proved, or inferred, any person prejudiced may have the transaction set aside, whether or not there was any intention of defrauding that person.”
“… the necessary intent is an intent on the part of the debtor to defeat, hinder, delay or defraud creditors, or to put assets belonging to the debtor beyond their reach, and that such intent may be inferred whenever this is the natural and probable consequence of the debtor’s actions, in light of the financial circumstances of the debtor at the time, as known, or taken to have been known, to him.”
“For the purposes of this appeal, though without deciding the point, I am content to assume in favour of the plaintiffs that the relevant purpose which has to be established in the application of s. 423 is substantial purpose, rather than the stricter test of dominant purpose. In the present case it is not open to the plaintiffs to argue that the very fact that the transfer was made for no consideration by itself establishes the requisite purpose of defrauding creditors. The requirements for the operation of the section imposed by s. 423(3) are additional to those imposed by s. 423(1) so that the actual purpose of the transferor has to be investigated. The test is not a solely objective one. … No doubt the result of the transfer was to put assets beyond the reach of the plaintiffs and otherwise to prejudice their interests, but in applying the section, result cannot be equated with purpose; and as yet, in my judgment, no prima facie case showing the relevant purpose has been established.”
“Once one accepts that there is a strong prima facie case that the bank’s security has been transferred to members of the family at a time when action by the creditor was clearly anticipated by the debtor and that these transfers were at an undervalue and that what remains in the hands of the debtor barely if at all covers the debt, there is in my judgment a strong prima facie case that the purpose of the transactions was to prejudice the interests of the creditor.”
“14. The principle that creditors should be protected from the consequences of transactions which are designed to prejudice their interests has long been embedded in English law. Section 423 of the 1986 Act is derived from a Statute of Elizabeth (13 Eliz 1, c 5) which provided that all dispositions of property made with the intention of delaying, hindering or defrauding creditors should be void against creditors. This did not extend to any estate or interest created bona fide and for good consideration in favour of any person not having at the time notice of such fraud. It has even been said that the Statute of Elizabeth was merely declaratory of the common law. It was replaced bysection 172 of the Law of Property Act 1925 , which in turn was replaced by section 423 and following. 15. There is considerable case law on the predecessors of section 423. Lord Mansfield CJ held that the Statute of Elizabeth (13 Eliz 1, c 5) should be liberally interpreted: Cadogan v Kennett (1776) 2 Cowp 434. Intent to defraud could be inferred from the making of a conveyance that would leave creditors unpaid: Freeman v Pope (1870) LR 5 Ch App 538. As Lord Hatherley LC so pithily put it in that case, at p 540, ‘persons must be just before they are generous”. … 17. Section 423 does not impose a sanction on a debtor whose actions prejudice his creditors unless the debtor’s purpose satisfies section 423(3). None the less, as I see it, section 423 has to be seen in the context of a debtor’s responsibilities to his creditors generally. It actualises those responsibilities in particular circumstances. Any argument that section 423 does not involve a breach of duty has therefore a somewhat counter-intuitive ring to it. Section 423 can be contrasted with for example section 238 of the 1986 Act which invalidates transactions at any undervalue within a given period of the insolvency. The object of this sanction is at least in part to enlarge the pool of assets available for creditors generally.”
“This is essentially a question of fact. The purpose of a person in entering into a transaction is a matter of the subjective intention of that person: what did he aim to achieve? Section 423(3) does not require the specified purpose to be the sole or dominant purpose. It is sufficient if it ‘can properly be described as a purpose and not merely as a consequence, rather than something which was indeed positively intended’: Inland Revenue Commissioners v Hashmi[2002] EWCA Civ 981 ; [2002] B.C.C. 943 at [23] per Arden LJ.”
“In around 2010, in view of his advancing years and also financial disputes which had arisen between him and his siblings, [Mr Almakhawi Sr] formed an intention to transfer assets to his children as an ‘inheritance’ while he was still alive. His wish was to minimise the risk of disputes between them after his death and to avoid the complications of a Sharia-compliant (post-mortem) inheritance. After the death of his brother Mohamed Almakhawi in November 2014, which precipitated a bitter inheritance dispute which continues to this day, that intention on the part of [Mr Almakhawi] developed into a plan. In pursuance of that plan, and for the purposes described above in this paragraph, he first transferred to his children properties in Dubai (see paragraph 24 below) and then his flat in London, 193 Warren House, which he wished to gift to his son, [Mr Almakhawi Jr]. In respect of 193 Warren House, [Mr Almakhawi Sr] had the additional motivation that [Mr Almakhawi Jr] had paid substantial amounts of money to or on behalf of his father over the preceding few years.”
“As is typical in such cases, his daughter is far better able to recount and describe these symptoms because the nature of the condition adversely affects the sufferer’s insight, making it difficult for the patient to remember and describe their symptoms in any detail or in any logical or chronological order.”
“[Mr Almakhawi Sr] appears to be suffering from the following conditions and symptoms, which are likely to have been largely caused, and/or exacerbated by, the prolonged high stress and distress from many years of protracted intense legal action and court appearances: 1. Major Depressive Disorder 2. Anxiety Disorder 3. Panic Attacks / Panic Disorder 4. Insomnia and sleep deprivation 5. Chronic Confusional State.”
“[Mr Almakhawi Sr] is currently fit to appear in Court but I qualify this statement as follows: I respectfully advise the Court(s) that all the above mental health conditions and symptoms suffered by [Mr Almakhawi Sr], will be significantly exacerbated by the very high stress of court appearances and persistent detailed questioning. As a result of the aforementioned mental health conditions and stressful Court appearances and questioning, [Mr Almakhawi Sr] will inevitably exhibit: significantly impaired recall; difficulty and delays in comprehending and responding to questions; confusion, vagueness, inaccuracies, factual errors and inconsistencies in answers; great difficulty organising his thoughts and answers; severe difficulty with organising and recounting answers in terms of chronology, dates, names of persons, lawyers and firms; confusion, uncertainty, hesitation, vagueness, factual errors, chronological errors and inconsistencies in answers to questions, particularly regarding which person, lawyer or legal firm made which particular comments or statements, whether written or verbal.”
“… led to a bitter inheritance dispute between my siblings, which still remains unresolved to date.”
“Court of Personal Status hereby certifies that the file of the inheritance, belonging to the above-mentioned deceased/Muhammad Al-Makhawy Al -Swaidy, has been registered dated 24-08-2015 AD. His inheritance was limited to his two brothers/Rashid and Salim and to his Turkish sister. The legal division was determined by five shares, each brother is entitled to two (2) shares, while the sister is entitled to one (1) share. So far, the distribution of the inheritance elements and the proportion of each heir have not been finalized. The property located in Umm Al Quwain has been transferred in the name of the heirs. In addition, the inventory has been transferred to the heir/Rashid Abdulazeez Al-Makhawy, deducting from his proportion in an amount of (AED 19453645).”
“In view of the problems that happened in the estate of my brother Mohamed Al-Makhawi, which you are aware thereof, in your capacity as the lawyers who defend me in the estate mentioned above, I decided to transfer all my property, inside and outside, in the name of my children avoiding any disputes that may arise in the future among them, noting that you have all papers and documents related to my property. I trust that you will complete such actions and you have the right to duly enlist any of the bodies and persons that have competence and experience.”
“We, Dar Al Adalah, received on29/12/2015 ”
“This PDF document was not included in the Defendants’ original batch of Extended Disclosure. It was provided late on20 December 2022 . The First Defendant appears to make reference to this document in his witness statement for trial stating (at paragraph 39) that he has ‘a letter formally instructing DAA to start transferring my assets as a part of succession planning in 2015 and I will provide a copy of this letter as soon as I am able’. DWF asked to inspect the original letter which SCW said was being held with the Defendants’ lawyers in Dubai. However, upon visiting their offices, DWF were informed that the Defendants’ lawyers are only holding a copy of this document and not the original.”
“Met client who recently credited$21m from HSBC Jersey trustees. Courtesy meeting as was outside DIFC. Client indicated that he is a very conservative investor and is not comfortable with fluctuations of the market. Client indicated that he will invest$5m and see what performance will be and might invest further going forward. Agreed that we would provide an investment proposal to Mohamed Hadi, his PAO in DIFC which will be discussed in compliance with DFSA rules and potentially invested accordingly. Client is shortly travelling to London and Germany where he has homes (extended invitation to Luxembourg). Discuss with David and prepare proposal for M Hadi to present to client.”
“The meeting was being held as [redacted] and wished to set up the same for the money that had been distributed to him from this Trust. RAM is a very private person and does not like others to be aware of his affairs. Most of his assets are held in cash and he wants to protect this for his family whilst ensuring that Sharia applies in terms of distribution. [Redacted] went through the MENA Deed Questionnaire and explained to him a Trust, the parties to a Trust, the pros and cons and provided live examples. RAM made it clear he wanted his Trust to reflect that of [redacted] with his children as beneficiaries. Following his death the Trust Fund is to be distributed. [Redacted] confirmed that this could be arranged. RAM expressed the importance to having the documents be ready for him to execute for him to execute before Eid and a meeting for19 June 2017 was agreed.”
“A. There is no relation between the judgment and when I instruct my bank. … Q. You had$21 million in a bank account in Luxembourg which you knew your creditors would be able to attach, to execute against, if they found out about it. That is why you settled the Jersey trust, to protect that money for your family, to put it beyond the reach of creditors. That is true, is it not? A. Okay, so the bank suggests – this is not true, because the bank comes to me with the idea of investments and I let them get on with it. The court – the judgment against me was unjust and in reference to several experts.”
“My reasons for settling the Trust include: • to benefit the beneficiaries and provide for their education advancement, maintenance and support; • a desire to avoid the delay, and hardship which can be brought about by lengthy probate procedures; • succession planning; and • to protect the assets in the Trust as much of possible from disruptive events such as the bankruptcy of a beneficiary.”
“RAAM then made reference to his UK Premiere account explaining that he had received a letter from them requesting additional due diligence. RAAM provided CB with a copy of this letter and she confirmed that she would deal with this matter. CB asked what currency the funds in this account were held in. RAAM informed CB that the monies were held in sterling. CB suggested that RAAM consider converting this to USD as IHT would be payable if held in GBP on RAAM’s passing. RAAM confirmed that he would do this and also informed MH that he wanted an account open with Premiere in the UK for his son in respect of the UK property to be gifted to his children (see below). RAAM then made reference to two properties that he owns. One in the UK located at 193 Warren House, 185 Beckford Close, W14 8TR, which he purchased in 2008/2009 for circa GBP1.6m. The second in New York in the US which was purchased two years ago for circa USD1.65m. RAAM wants to understand what he needs to do for succession planning in respect of these properties. CB recommended that RAAM first obtain a valuation for the property in the UK (he wants to gift this property to his three children who are all resident in the UAE) and obtain tax advice for the property in the US (which he is considering gifting to his daughter). RAAM requested that CB arrange this on his behalf.”
“Q. You didn’t tell HSBC about it, did you? A. So why would I – every time there is a problem I have to run to HSBC and inform them. Q. You were going to HSBC saying you were going to gift a property to your children and you didn’t tell them about the judgment against you, did you? That is the question. A. What has the bank got to do with the judgment – that is a bank, why …”
“Kindly note that I have a UAE resident client who has a property in London which is debt free. Our client wishes to gift the property to his son and as such a valuation has been carried out, which confirms that on5 April 2015 the property value was GBP1,750,000 and today the value is GBP1,595,000 meaning that it has declined. On this basis, I understand that no CGT is payable on the gift from father to son and all that is required is for a TR1 form to be completed and filed with Land Registry. I would be grateful if you could let me know if this is the case (or if I am missing anything) and also if you would be able to assist us in arranging the gift for which we would require an indication of your costs.”
“SCOPE OF OUR WORK The scope of our work will comprise transferring the ownership of your UK property to your son, including: 1. Preparing the deed of gift to transfer the property; 2. Carrying out the property transfer work; 3. Dealing with a licence to assign and any other landlord’s requirements in respect of the transfer; and 4. Filing the non-resident capital gains tax return in respect of the transfer of ownership.”
“The transfer is not for money or anything that has a monetary value.”
“(B) The Donor has transferred the leasehold property known as 192 Warren House Beckford Close Warwick Road London W14 8TR and registered at the land registry with title number BGL42461 (the Property) to the Donee with full title guarantee. (C) The Donor wishes to confirm that the Property has been irrevocably gifted to the Donee. (D) The Donee wishes to accept the gift of the Property.”
“1. The Donor hereby confirms that beneficial title to the Property has been irrevocably transferred from the Donor to the Donee by way of gift and legal ownership of the Property has transferred so that the Property is now under the Donee’s control. 2. The Donee hereby acknowledges and accepts the gift of the Property and confirms receipt thereof.”
“The property was not sold rather transferred between family members. The payment arrangements/direct debit will be remaining as they were an no apportionment or refunds will be necessary.”
“Q. Okay, what I am going to suggest to you is this. You transferred this property to your son to protect it from your creditors for the benefit of your family. A. No, this is not true. Q. There are two possibilities: either your son was holding it for you – which is consistent with the fact that you continued to meet the outgoings – or it was an out-and-out gift to protect it from your creditors. A. Okay, so I did not lose all the cases. To answer your question, it is not true in terms of the gift and the transfer. Some of these cases were lost because of Dar-Al-Adalah, and by that I mean the ex solicitors, who did not submit the paperwork on time and did not attend court, and I was outside – I was out of the country at the time.”
“A. As I told you, I keep repeating nearly 20 times this, for now my job was to write the cheque whenever my father asks for money. I would give him the cheque. Q. Is that because what is mine is his, if I can put it that way, and what his is mine? A. Exactly. Q. Sort of family honour. A. Exactly. Q. If you have the money so you are morally obliged to hand it to your father and if it were the other way round he would give you the money. A. Exactly.”
“A. So would you like me to say no to my children? My son deals with shares and, you know, sometimes there are large amounts involved, and I do ask him occasionally, what is this amount for and this? But on the whole this is my family and when they want money, they get it.”
“My son asked me for it and I gave it to him.”
“A. I don’t do this business. I never do deposits. … A. And I am free to do whatever I want with my money. Maybe for you it makes sense to make a deposit, for me it doesn’t.”
“Q. What I am going to suggest to you is this. These monies were transferred into an account not used previously for any other purpose. That is correct, isn’t it? A. It has not been used, no. Q. They were not mixed with any other monies. A. Okay, because that is the only money in the UK. Q. And that is because the basis of these transfers was either that you would hold the cash for your father or because it was made to shield the asset from your father’s creditors and you wanted an account that was not traceable back to you, because there were – A. Well, it is traceable, it is not – it is traceable, you are saying we are trying to transfer to an account which cannot be traced. It is traced. Q. What I am suggesting to you is the reason you wanted an account which had not been used before was so that somebody in Dubai who started looking into where your money had gone wouldn’t be able to see that account on any document in Dubai? A. That is not correct. That is not correct. He wanted to pay me back the loan that I have given him. Q. Then why did you specially open an account to receive the monies? A. Because I do not have any relation with any British bank. How was he going to give me the money? Q. He could just organise a funds transfer to you anywhere. He could just tell his bank to make a transfer. A. Well, we decided and discussed to have the money in the UK. Q. Are you seriously suggesting that you don’t know that you can tell your bank to make an international funds transfer? A. I did not need the money in the Emirates. I do not need it. I want this money in the UK. I don’t want to put all my eggs in one basket. Q. But your father had a sterling account. He could have transferred it into dirhams or dollars or euros or any other currency anywhere, but what you did was open an account specially and move the money into that account. A. Because we – I wanted the money to be in the UK. Q. I am suggesting to you that you wanted it in the UK in an account which had no previous dealings in respect of it – A. That is not correct. Q. - so that somebody – A. Because I did not need the money to use it, okay, and I wanted to diversify, that is why I wanted to open a bank – open an account in the UK, which I had never invested in before and I have never had a relation in the UK with a bank. I dealt with different banks around the world, but I have never dealt with the UK.”