Marketmaker Technology (Beijing) Co Ltd & Ors v CMC Group Plc & Ors [2009] EWHC 1445 (QB)

[2009] EWHC 1445 (QB)Case No HQ04X01875
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Venue Royal Courts of Justice, Strand, London, WC2A 2LLDate 24/06/2009
Before
MR. JUSTICE TEARE
Between
MARKETMAKER TECHNOLOGY (BEIJING) CO LIMITED (now Forex Asia (Beijing) Management Ltd and formerly Xi Yin Online (Beijing) Technology Ltd)ClaimantsOBAIR GROUP INTERNATIONAL CORPORATIONClaimantFOREX TECHNOLOGY CORPORATIONClaimantNASER TAHERClaimantCMC GROUP PLCDefendantsCMC ASIA PACIFIC PTY LTDDefendantPETER CRUDDASDefendant
Anthony de Garr Robinson QC and Laurence Emmett (instructed by CMS Cameron McKenna LLP) for First and Third DefendantsRichard Lissack QC and Richard Wormald (instructed by Radcliffes Le Brasseur) for Fourth ClaimantHearing Hearing dates: 9 and 10 June 2009
JudgmentMr. Justice Teare:
[1]This is the Court’s judgment on an application by the First and Third Defendants (“the applicants”) to commit the Fourth Claimant, Mr. Naser Taher, for contempt. The application was issued on 21 August 2007. There have been three attempts to hear it, on 11 October 2007, 18 March 2008 and on 11 June 2008. In the event the hearing commenced on 31 July 2008 with Mr. Taher giving evidence by video link from Beijing but that hearing had to be adjourned for the making of final submissions. They were finally heard in June 2009.[2]The alleged contempt is a failure to discharge an undertaking given to the court on 29 March 2007 to disclose documents relating to his means. That undertaking was given in the course of attempts by the applicants to enforce substantial costs orders which had been made against Mr. Taher in October 2004.[3]I gave a judgment on 12 June 2008 in which I decided various interlocutory issues and adjourned the hearing of the committal application for the third time, [2008] EWHC 1556 (QB). At paragraphs 3-23 I recounted the history of this matter. I do not propose to repeat that history in this judgment but it is to be regarded as having been incorporated into this judgment by reference.[4]However, it is necessary to recount very shortly what has happened since June 2008. I gave permission for Mr. Taher to give evidence by video link at the hearing of the application. On 16 July the applicants complained that Mr. Taher had failed to arrange a video link. On 18 July I ordered that the hearing of the contempt application should take place no later than 31 July. On 28 July Mr. Taher’s solicitors said that video conferencing facilities were not available on 29 or 31 July but the applicant’s solicitors said they were. Also on 28 July Lady Justice Hallett dismissed Mr. Taher’s application for permission to appeal from my judgment of 12 June. On 31 July there was a fourth attempt to hear the contempt application. Mr. Taher was cross-examined by video link from Beijing but there was insufficient time to hear submissions and I therefore ordered the applicants and Mr. Taher to produce written submissions by 15 September and 3 October respectively. The applicants produced their submissions on 15 September. Mr. Taher did not produce written submissions on 3 October.[5]On 27 and 29 October I was informed by counsel for Mr. Taher that a substantial further affidavit with several hundred pages of exhibits was to be expected. On 30 October the applicants’ solicitor wrote to me expressing his clients’ dismay at the suggestion of new evidence and said that the introduction of any new evidence would be opposed. On 11 November I informed the parties that no application to introduce new evidence had been made and invited the applicants to seek a date for the hearing of submissions. On 13 November the applicants’ solicitor informed me that a decision as to the future conduct of the contempt application could not be made until late November or early December.[6]On 1 December Mr. Taher produced his Fifth Affidavit. It ran to 228 pages and was accompanied by 11 files containing 2,825 pages of exhibits. On 11 December Mr. Taher issued an application for an order striking out the committal application or, in the alternative, for disclosure and other matters. On 18 December I ordered Mr. Taher by 7 January 2009 to identify the further evidence in his Fifth Affidavit which was relevant to the committal application, to identify any documents in the exhibits which were documents which he had been ordered to disclose and to provide a skeleton argument in support of his applications and in response to the applicants’ closing submissions.[7]On 6 January 2009 Mr. Taher swore his Sixth Affidavit. It ran to 165 pages. He also provided affidavits from two other persons. On 20 January counsel on his behalf provided written submissions. They were amended on 2 February 2009. On 25 February the adjourned committal hearing was fixed for 21 and 22 April 2009. On 11 March Mr. Taher’s counsel informed the applicants’ counsel that there were certain preliminary issues to be dealt with and that he was not available on 21 and 22 April. I indicated that I was not minded to vacate the hearing fixed for 21 and 22 April but on 18 March, after hearing submissions made by counsel for Mr. Taher, in particular that the Defendant could not afford to instruct alternative counsel, I agreed to vacate the hearing fixed for 21 and 22 April. The hearing was refixed for 9 and 10 June. At that hearing Mr Taher was represented by leading and junior counsel.[8]It is to be observed from the history of this matter as set out in my previous judgment and in this judgment that Mr. Taher’s response to the contempt application brought against him has been characterised by a tendency to produce voluminous documentary material before a hearing is about to take place. Thus on 10 October 2007 he produced evidence and documents which caused the hearing before King J. the next day to be adjourned. On 18 March 2008 he produced a substantial quantity of evidence by e-mail some 15 minutes before the hearing before Swift J. was about to start. That caused that hearing to be adjourned. The next hearing was fixed before me on 11 June 2008 and was adjourned, though not because of the late production of evidence. Instead, Mr. Taher applied to have service of the contempt application set aside. I rejected that application. He also sought permission to give evidence at the hearing of the committal application by video link from Beijing. I granted that application but it followed that the June 11 hearing had to be adjourned to set up the video link. Although Mr. Taher did not arrange a video link and said, through his solicitors, that video conferencing was not available on 31 July, it was available and Mr. Taher gave evidence by video link on 31 July. In December 2008, when all that remained of the committal application was to hear final submissions, he produced a massive affidavit accompanied by 11 volumes of exhibits. Another large affidavit followed in January 2009. These latter affidavits were described by both counsel at the hearing in June 2009 as impenetrable. However, that may perhaps be an overstatement because counsel did make a few references to their contents. Nevertheless, vast tracts of those affidavits were not helpful although other parts did seek to respond to the allegations against Mr. Taher. Whatever may have been his motivation for conducting his defence in the way he has, the foreseeable effect of his conduct has been to delay the hearing of the contempt application brought against him.

The applicants’ submissions

[9]Counsel on behalf of the applicants illustrated, by reference to a tabulated document, what had been disclosed and when by Mr. Taher in relation to each of the 17 categories of documents which he had specifically undertaken to disclose. That document enabled the court to see what had not been disclosed at the date of the application notice, 21 August 2007, by reference to what had been disclosed later. Counsel then identified what still remained to be disclosed pursuant to Mr. Taher’s undertaking, taking into account the contents of Mr. Taher’s latest affidavits. Thus counsel submitted that Mr. Taher had been in breach of his undertaking at the date of the application notice and remained in breach, though the extent of his breach had been reduced as and when documents had been produced between 21 August 2007 and January 2009. For the purposes of the hearing counsel concentrated on categories 1-4 (bank accounts and credit card accounts), 8-9 (accounts, financial statements and bank accounts of companies with which Mr. Taher is or has been associated) and 11-13 (land in Jordan owned by Mr. Taher or his late father). This approach made the hearing manageable. Apart from one reference counsel did not invite me to take into account the evidence given by Mr. Taher on 31 July 2008. Indeed, the scope of counsel’s submissions was limited by comparison with the wider scope of the written submissions served on 15 September 2008.

Mr. Taher’s submissions

[10]The submissions made by counsel for Mr. Taher were also limited by comparison with the wider scope of the written submissions served on 20 January 2009. Counsel for Mr. Taher made some general but important observations on the court’s power to commit, stressing in particular that the criminal standard of proof applied. Counsel’s written submissions (those prepared specifically for this hearing) identified the subjects in respect of which Mr. Taher had disclosed documents and evidence (his earnings, his relationship with Forex Asia International Corporation (FXA, the holding company of the businesses with which Mr. Taher has been concerned) and accounts and documents from FXA and the First Claimant) and identified those documents and evidence. However, it is to be observed that the bulk of such material was provided after the date of the application notice, 21 August 2007. Thus those submissions did not grapple with the alleged contempt as at 21 August 2007, but instead established that since that date Mr. Taher has disclosed much of the documentation he had undertaken to dislcose by 20 June 2007 (pursuant to an order of Master Yoxhall dated 30 May 2007 which incorporated Mr. Taher’s undertaking given on 29 March 2007). Counsel made few submissions as to the detail of what the applicants said remained to be disclosed pursuant to Mr. Taher’s undertaking and did not refer me to any parts of his evidence given on 31 July 2008. However, counsel made submissions as to the construction of Mr. Taher’s undertaking to the court given on 29 March 2007 and as to need for the allegations of breach of the undertaking to be proved as at the date of the application notice, 21 August 2007. These latter points enabled him to submit that certain of the alleged breaches of the undertaking were not breaches or, if they were, they were not breaches as at the date of the application notice and so were not open to the applicants. Counsel also submitted that it did not follow that a breach of the undertaking was a contempt of court. Before dealing with each category of complaint I should first deal with some of the general observations made by counsel.[11]It was submitted that the power to commit for contempt is most often reserved for breaches of prohibitory injunctive relief. By contrast it was observed that in the present case it was sought to be used for breaches of an undertaking to disclose certain documents. Whether or not the power to commit is most often used in the context of breaches of prohibitory injunctions the use of the power in the case of this undertaking to disclose certain documents can hardly be the subject of complaint. That is because the undertaking was given by Mr. Taher in order to have an order for his committal for contempt set aside. Moreover, CPR Part 71.1 and 71.8 specifically envisage contempt applications in respect of a failure to produce documents by persons attending court to be examined as to means.[12]It was also stressed that the charge or allegation of contempt must be particularised so that the alleged contemnor knows the case against him. In AG for Tuvalu v Philatelic Distribution [1990] 1 WLR 926 at pp.934-935 Woolf LJ said:
“…….an alleged contemnor should be told, with sufficient particularity to enable him to defend himself, what exactly he is said to have done or omitted to do which constitutes contempt of court. The cases make clear that compliance with this rule will be strictly insisted upon since the liberty of the subject is at stake, but they also show the nature or background of the case is important.”
[13]In the present case the application notice dated 21 August 2007 was a generalised complaint that Mr. Taher had failed to comply with his undertaking by 20 June 2007 (which was the relevant date pursuant to the order which incorporated his undertaking). However, the generalised nature of that allegation cannot be the subject of complaint because as at 21 August 2007 Mr. Taher had not produced any documents pursuant to his undertaking. Thereafter, as a result of Mr. Taher’s late disclosure of certain documents more detailed allegations as to what remained to be disclosed under the specific categories of documents identified in the undertaking were made either in correspondence or in counsel’s skeleton arguments. Mr. Taher responded to these more detailed allegations in his affidavits. Counsel for the applicants then identified in his opening submissions before me what remained to be disclosed. Whilst I had a sense of unease during counsel’s opening submissions that Mr. Taher’s counsel was hearing for the first time what remained to be disclosed I was, however, ultimately satisfied that that sense of unease was not justified. Mr. Taher knew what was said against him at all stages of this application (see in particular the comprehensive written submissions prepared by the applicants’ junior counsel dated 9 June 2008, 15 September 2008 and 5 February 2009) and there was no unfairness to him at the hearing. Counsel for the applicants might simply have made submissions as to what had not been disclosed as at 21 August and left it to counsel for Mr. Taher to indicate, by way of mitigation, what had been disclosed after 21 August. Thereafter, it would have been permissible for counsel for the applicants to identify by way of reply what still remained to be disclosed. Thus what might fairly have been said by way of reply was said by way of opening.[14]It was common ground that proof of a breach of the undertaking did not equate to a contempt. For a contempt to be established it has to be shown that the conduct which breached the undertaking was intentional or deliberate and that the alleged contemnor had knowledge of the facts which made his conduct a breach. It is unnecessary to establish that the alleged contemnor appreciated that his conduct was a breach of the undertaking. The law on this point was summarised by Warrington J in Stancomb v Trowbridge Urban District Council [1910] 2 Ch. 190 at p.194:
“In my judgment, if a person or a corporation is restrained by injunction from doing a particular act, that person or corporation commits a breach of the injunction, and is liable for process for contempt, if he or it in fact does the act, and it is no answer to say that the act was not contumacious in the sense that, in doing it, there was no direct intention to disobey the order.”
[15]The written submissions of counsel for Mr. Taher referred me to Arlidge, Eady and Smith on Contempt (3rd.ed., 2005) para.2-81 where it is stated that the requirement that the contemnor’s conduct be intentional or deliberate means that it should not be accidental. There is also there to be found an observation by Eveleigh LJ in Z Ltd. v A-Z and AA-LL [1982] QB 558 at p.580:
“In the great majority of cases the fact that a person does an act which is contrary to the injunction after having notice of its terms will almost inevitably mean that he is knowingly acting contrary to those terms…..”
[16]In the present case there can be no doubt that Mr. Taher knew of his own undertaking and its terms.[17]Counsel for Mr. Taher invited the court to consider whether Mr. Taher did not honestly believe that he had complied with the undertaking. However, that is not in my judgment a necessary inquiry when deciding whether Mr. Taher has acted in contempt of court and I did not understand counsel to suggest that it was.[18]Counsel for Mr. Taher submitted that no order or undertaking will be enforced by committal unless its terms are clear, certain and unambiguous. This principle is reflected in Jobserve v Skillsite [2004] EWHC 661 (Ch) in which Lewison J. held, at paragraphs 12-14, that whilst the general principles of contractual construction applied to the construction of undertakings any ambiguity should be resolved in favour of the person giving the undertaking.

Bank accounts and credit cards (categories 1-4)

[19]In relation to category 1, “up to date statements in respect of bank account 0534 no.2 at the Oriental Plaza branch of the Industrial and Commercial Bank of China”, Mr. Taher had produced no statements pursuant to his undertaking dated 29 March 2007 by the time of the application notice dated 21 August 2007. Thus it is clear that he was in breach of his undertaking as at 21 August 2007. However, in October 2007 (just before the first hearing of the committal application before King J.) he produced bank statements for an account no. 4404 with a branch code 0534 for the period June - September 2007. At the end of 2008 and at the beginning of 2009 (that is, after his evidence by video link in July 2008 and when all that remained was final submissions) he produced further statements for the periods May 2005 - 2006, January - December 2007, and January - December 2008. Counsel for the applicants accepted that when this bank account had first been identified a mistake may have been made by Mr. Taher in saying that 0534 was its number rather than its sort code. However, counsel submitted that Mr. Taher remained in breach of the undertaking because he had not provided statements for this account for the period January – June 2009. This submission raised for decision the scope of the undertaking and to what extent if at all the applicants could rely on events after the date of the application notice.[20]The relevant part of the undertaking which was given on 29 March 2007 is as follows:
“to consent to an order requiring him …………within 21 days (1) to disclose all documents in his control which relate to his means of paying the amounts due under the Costs Orders, including but not limited to those documents listed in the Schedule attached hereto; and (2) insofar as any documents listed in the Schedule are not in his control, to swear an affidavit explaining why such documents are not in his control and what has become of them.”
[21]Counsel for Mr. Taher submitted in writing that Mr. Taher’s duty pursuant to the undertaking was to disclose all documents in his control at the time of disclosure which related to his means “as at 29 March 2007” of paying the amounts due under the costs orders.[22]In my judgment of 12 June 2008 I had to consider the question whether the undertaking required Mr. Taher to disclose documents relevant to his means which were in his control at the time when he gave disclosure or only those which were in his control at the date of the undertaking, 29 March 2007. For the reasons given in paragraphs 38-40 of my earlier judgment I held that the undertaking required him to disclose those documents within his control at the time of disclosure so that there was, until Mr. Taher complied with his undertaking, a continuing obligation to disclose relevant documents within his control. When I decided that question in June 2008 it did not appear that there was any further question of construction to be resolved such as has now been raised. It is to be observed that in October 2007 Mr. Taher had disclosed bank statements for the period from June - September 2007 and counsel then appearing for Mr. Taher did not take the point that Mr. Taher’s obligation extended only to documents relating to his means “as at 29 March 2007”.[23]In my judgment the point now taken, that the undertaking relates to Mr. Taher’s means as at 29 March 2007, is not the meaning which the undertaking would convey to a reasonable person having all the background knowledge which would reasonably have been available to Mr. Taher when he gave the undertaking, for these reasons: i) The relevant background knowledge is that the undertaking was to provide documents as to means so that Mr. Taher could be effectively cross-examined as to his means to pay the costs orders made against him. Indeed, the undertaking obliged Mr. Taher to attend an examination and to provide information “about his means and any other information needed to enforce all costs orders against him”. ii) Having regard to that background a reasonable person would expect that the documents to be disclosed would relate to his means at the time when he gives disclosure pursuant to the undertaking. That is because Mr. Taher’s ability to pay the costs orders will be determined by his present means and not by his historic means. iii) The words “as at 29 March 2007” are not to be found in the undertaking and would therefore have to be added to the undertaking. There is no reason to do so.[24]I am mindful of the principle established in Jobserve v Skillsite [2004] EWHC 661 (Ch) to which I have referred. However, in order for an undertaking to be ambiguous there must be, at the least, an alternative interpretation which is an available meaning of the words to be found in the undertaking. I do not consider that the words used in the undertaking are fairly capable of meaning that only documents relating to Mr. Taher’s means as at the date of the undertaking need be disclosed. The undertaking is not ambiguous and so there is no scope for resolving any ambiguity in favour of Mr. Taher.[25]Counsel for Mr. Taher further submitted that the only permissible complaints which the applicants can make on this contempt application are circumscribed by the application notice dated 21 August 2007, that is, that only conduct that was a breach of the undertaking as at 21 August 2007 can be relied upon. If there was conduct after that date that amounted to a further breach a further application notice was required.[26]In principle this submission is correct. However, care is needed in its application. It is necessary to examine the nature of the breach which has been alleged and proved as at the date of application notice.[27]Mr. Taher was obliged by his undertaking to disclose “all documents in his control which relate to his means of paying the amounts due under the Costs Orders, including but not limited to those documents listed in the Schedule attached hereto.” So long as that obligation remains unsatisfied the obligation continues. That is what I held to have been the meaning of the undertaking in June 2008. Such meaning is consistent with the purpose of the undertaking which was to provide material with which to examine Mr. Taher as to his means. Such means must be current rather than historic (though there would or might be some inevitable delay between compliance with the undertaking and the oral examination). It follows that so long as his obligation pursuant to the undertaking is not discharged he must continue to disclose documents relevant to his means and in particular those in the schedule.[28]With regard to the bank account at the ICBC Mr. Taher was, as at 21 August 2007, in breach of his undertaking to provide “up to date statements” of that account. That was a breach of a continuing obligation which would only end when Mr. Taher had complied with the whole of his undertaking to the court. Thus, as at 21 August 2007 he ought to have disclosed up to date statements for the account not only up to 20 June 2007 but up to 21 August 2007. Similarly, so long as Mr. Taher remains in breach of his undertaking (which he does in relation to category 11, for the reasons expressed later in this judgment), he remains obliged to produce “up to date statements in respect of his bank account”. It is now June 2009. He has not disclosed the statements for the period January - June 2009.[29]Counsel for Mr. Taher submits that as at August 2007, the date of the application notice, he was obviously not in breach of an obligation to disclose the statements for the period January - June 2009. However, the obligation of which he was in breach on 21 August 2007 was a continuing obligation to disclose up to date statements of his bank accounts. So long as he remains in breach of other aspects of the undertaking he remains under an obligation to disclose up to date statements of the account. That is the very breach which existed on 21 August 2007. It is a continuing breach. The failure to disclose up to date statements for the period January to June 2009 is not a further breach. I therefore reject the submission that the applicants are unable to rely upon the failure to disclose the statements from January 2009.[30]In order to find a person in contempt it is necessary to establish to the criminal standard of proof that the conduct which breached the undertaking was intentional or deliberate and was carried out with knowledge of all the facts which made it a breach of the undertaking. It is not necessary to establish that the contemnor appreciated that those facts amounted to a contempt.[31]Mr. Taher gave an undertaking to the court in order to have a committal order made against him set aside. He must have appreciated the importance of complying with that undertaking. Yet he did not comply with it by the date of the application notice on 21 August 2007. It is an inevitable inference that his failure to disclose bank statements by that date (conduct which amounted to a breach of the continuing obligation to disclose up to date statements) was intentional or deliberate. Since he was aware of the undertaking and its terms (because he gave it) he was aware of the facts that made his conduct a breach. His breach was therefore a contempt of court.[32]He took steps to remedy his breach in October 2007 and at the end of 2008/beginning of 2009. However, he remained under a continuing obligation to disclose up to date statements (from January 2009) because he had not complied with the whole of his undertaking (with regard to category 11, see later in this judgment). It is possible that between January and June 2009 Mr. Taher did not appreciate that he remained in breach but that does not prevent him from continuing to be in contempt. However, the possibility that he may not have appreciated that he remained in breach (or contempt) coupled with the fact that Mr. Taher did, at the end of 2008/beginning of 2009, provide statements of his bank account bringing his account up to date as at December 2008 are matters to be kept well in mind when considering what penalty is appropriate for his contempt.[33]If my analysis with regard to the failure to disclose up to date statements of account for the period January to June 2009 being part of the continuing breach established as at 21 August 2007 is not correct Mr. Taher’s position is little different in substance. He was in contempt as at 21 August 2007. He has since disclosed statements of account up to December 2008 which mitigates his contempt but he remains obliged pursuant to this undertaking to disclose the up to date statements of account from January to June 2009.[34]With regard to category 2, “up to date statements in respect of bank account no.955 8880 20000111 5921 held with the East Changan Street branch of the International and Commercial Bank of China”, Mr. Taher had, before the undertaking was given in March 2007, disclosed statements of the account in question from July 2005 until 29 June 2006. However, no further statements have been disclosed in respect of this account. In his Sixth Affidavit dated 6 January 2009 he stated that this account was closed. However, the last account disclosed did not show a zero closing balance. He purported to exhibit bank statements relating to that closure. However, those documents relate to a different account (said to be no. 955 8880 20000353 8799) which appears to have been closed on 10 August 2006. Thus there is no documentary evidence that account no. 5921 was closed on 29 June 2006. Rather, Mr. Taher has produced evidence that he had another account with ICBC of which no statements have been produced. Since account no. 8799 was closed in August 2006 it would have no relevance to his means in March 2007 when he gave his undertaking or thereafter and is not specifically mentioned in category 2. So I am not concerned with his failure in March 2007 or thereafter to disclose the statements of account no. 8799 up to its closure in August 2006. However, the position as to account no. 5921 remains in doubt and that account is the account specifically mentioned in category 2. Mr. Taher says it was closed but has produced no evidence of that. So either it was closed or it remains in existence. Either way Mr. Taher is in breach of his undertaking. Either he has failed to disclose the closing statement or it remains in existence and he has failed to disclose the statements after June 2006 to date.[35]Counsel for Mr. Taher responded with an unexpected oral submission that the applicants were mistaken in suggesting that account no. 5921 was a bank account. It was unexpected because his written submissions, at paragraph 37.1, referred to it as an account with the ICBC. In his oral submissions he said that numbers beginning with 955 were credit card accounts and that accounts beginning with 02 were bank accounts. He did not rely upon a statement to that effect from Mr. Taher but made reference to several documents, in particular those relating to the closure of account no. 955….8799. He said that those documents referred to that number as a card number and that the bank account operated in connection with that card was no. 02….7748. Properly understood it was that bank account (no. 02…7748) which had been closed on 10 August 2006. He also referred to a statement of Jing Lu, a cashier at Forex Asia Financial Management Beijing Limited, who listed several accounts of that company which began with the number 02.[36]In reply counsel for the applicants observed that this was not something which Mr. Taher had ever said in his several affidavits. On the contrary his former solicitors had described account no. 955…5921 as a bank statement in July 2006. Moreover, Mr. Taher himself in his Fifth Affidavit sworn on 27 November 2008 confirmed (at paragraph 517.1) that account no. 955…5921 was his personal bank account which had been closed in 2006 and submitted that the applicants had the burden of producing evidence that that account had continued after 2006. In his Sixth Affidavit sworn on 6 January 2009 he referred to “ICBC Account No. 955….5921 Bank Statement”.[37]I conclude that the submission made by Mr. Taher’s counsel is contrary to Mr. Taher’s own evidence. Counsel did not attempt to explain the discrepancy between his submission and Mr. Taher’s evidence. Mr. Taher has said consistently from July 2006 (through his former solicitors) to January 2009 that account no. 955….5921 was a bank account. In the circumstances I do not regard the submission made by counsel as one which I can accept.[38]I therefore conclude that Mr. Taher has either failed to disclose the closing statement of that account or it remains in existence and he has failed to disclose the statements after June 2006 to date. That is a breach of the undertaking and I further conclude (for the reasons I have already given in relation to category 1) that the failure is a contempt of court.[39]Category 3 concerns “up to date statements in respect of any other bank account” held by Mr. Taher alone or jointly. The schedule identifies five such accounts, an ICBC Club Card, a Citic account no. 0311, and three accounts nos. 2527, 3867 and 8799. No statement had been produced for any of these accounts at the time of the application notice in August 2007.[40]In October 2007 Mr. Taher produced payment vouchers evidencing payments into the Club Card account from July 2006 to October 2007. However, no statements have been disclosed. The witness statement of Jing Liu seeks to deal with this matter. His position as a cashier is “quite junior”. He states that he issued the vouchers and that they relate to Mr. Taher’s salary. He states that in 2006 when Mr. Taher had a personal bank account with ICBC he had a debit card described as “Elite Club Card”. Jing Liu paid the salary into the personal bank account and marked the vouchers with the words Elite Club Card. He did not know that the account had been closed in July 2006 and so continued to mark the vouchers Elite Club Card not knowing that the payments were paid in cash after July 2006. The applicants are obviously sceptical as to the truth of this explanation. However, Jing Liu has not been cross-examined. I am unable to say that I am sure that his account is untrue. I cannot therefore find a breach or a contempt with regard to the Club Card account.[41]So far as Citic account no. 0311 is concerned no statements were disclosed as at the date of the application notice. At the end of 2008/beginning 2009 statements for October and December 2008 were disclosed. The applicants say that Mr. Taher remains in breach because the undertaking has not yet been wholly discharged and so he remains under a continuing obligation to disclose the statements for January to June 2009. The response of Mr. Taher’s counsel is that this account was only opened in October 2008. The account therefore did not exist as at the date of the application notice, August 2007, and so the complaint is not open to the applicants.[42]I do not understand it to be challenged that this account was opened in October 2008. The question therefore is whether it follows that no complaint can be made of the failure to disclose the statements for January to June 2009 pursuant to the application notice issued in August 2007. As will be apparent from this judgment Mr. Taher has not yet wholly complied with his undertaking (in relation to category 11). For the reasons expressed in my previous judgment the undertaking is a continuing obligation. Consistently with that ruling Mr. Taher has disclosed the statements for October and December 2008. However, I do not consider that the application notice dated August 2007 is apt to include a failure to disclose documents relating to an asset which did not exist in August 2007 and only came into existence over 12 months later. Whilst it can fairly and reasonably be said that as at August 2007 Mr. Taher was in breach of his continuing obligation to disclose up to date statements of his bank account with ICBC (category 1) and that that is the very obligation of which he remains in breach, I consider that it cannot be fairly and reasonably said as at August 2007 that Mr. Taher was in breach of an obligation, continuing or otherwise, to disclose up to date statements of a bank account that did not exist at that time. That breach was a further breach to that which existed as at the date of the application notice. I therefore do not consider that I can properly hold Mr. Taher in contempt, under the umbrella of the application notice dated 21 August 2007, in respect of his failure to disclose the statements for the period January to June 2009 in respect of this account. That would require a further application notice.[43]With regard to the two accounts nos. 2527 and 3867 no statements were disclosed as at the date of the application notice. At the end of 2008/beginning of 2009 Mr. Taher disclosed statements relating to various periods from 2003 to 2005 in respect of no. 2527 and relating to August 2003 in respect of no. 3867. No up to date statements have been disclosed. Counsel for Mr. Taher submitted that the reason for that is that the accounts have been closed. I asked counsel to identify the evidence supporting that submission. I was told that it was to be found in the references listed in the applicants’ tabulated document relating to accounts nos. 2527 and 3867. However, counsel did not take me to those references and my own reading of those references when preparing this judgment did not reveal evidence of closure. I was not referred to any statement by Mr. Taher relating to these bank accounts in his very long affidavits. Nevertheless I looked at pp.20-23 of Mr. Taher’s Sixth Affidavit which deals with category 3. I could not find a reference to these bank accounts there but the suggestion that the accounts have long been closed is at least consistent with what he there says as to category 3. In the result I am not satisfied so as to be sure that these accounts were not closed some time before March 2007, the date of the undertaking.[44]As to account no. 8799 it is accepted that there is evidence that this was closed on 10 August 2006.[45]For these reasons I do not find that there was a breach or a contempt with regard to account nos. 2527, 3867 or 8799.[46]Counsel for the applicants submitted that there was a further bank account held by Mr. Taher with the Bank of China. Mr. Taher has himself admitted that he has such an account in his affidavit dated 18 March 2008 at paragraph 19.5. It appears to be numbered 2982 because that number is to be found on slips evidencing payments in to that account in December 2007. However, no statements in relation to that account have been disclosed.[47]Counsel for Mr. Taher submits that there is no evidence that that account existed in August 2007 when the application notice was issued. I was not referred to any such evidence and accordingly, as with account 0311, I do not consider that I can properly hold Mr. Taher in contempt in respect of his failure to disclose statements in respect of this account. That would require either convincing evidence that this account existed in 2007 or a further application notice.[48]Category 4 is the last category of personal bank accounts; “up to date statements in respect of the credit card account no. 0563 held with Shen Zhen Development Bank”. Prior to the undertaking in 2007 Mr. Taher had disclosed statements from March 2005 until June 2006. As at the date of the application notice no further statements had been provided. There was therefore a breach with regard to this account. But in October 2007 statements for the period from April to September 2007 were disclosed and in April 2008 statements up to March 2008 were disclosed. No statements since March 2008 have been disclosed.[49]The response of Mr. Taher’s counsel was that this complaint was precluded by reason of the date of the application notice. However, there is evidence that this account existed in 2007 as at the date of the undertaking. Accordingly, for the reasons explained earlier in this judgment, that is not an effective response to a finding of breach or of contempt. Accounts, financial statements and bank accounts of companies with which Mr. Taher is or has been associated (categories 8-9)[50]In respect of category 8 the point which is pursued on this application is that the accounts of Marketmaker Technology (Beijing) Co. Ltd. (also known as Forex Asia Financial Management (Beijing) Ltd.) have been disclosed for 2004, 2005 and 2006 but not for 2007 or 2008. There is evidence that the accounts are produced in the first quarter following the year in question. Thus the accounts for 2007 and 2008 ought to be available.[51]The only answer suggested to this complaint is that it cannot be made pursuant to the application notice dated August 2007. However, the company in question existed in 2007. The accounts of the company are relevant to Mr. Taher’s means (and even if they were not they are nevertheless expressly mentioned in the schedule) and so must be disclosed. As at the date of the application notice Mr. Taher had failed to disclose the accounts for 2006. They were dated 8 March 2007 and so ought to have been disclosed pursuant to the undertaking. They were disclosed in October 2007. As the undertaking has not wholly been discharged (see category 11) the obligation to disclose documents relevant to Mr. Taher’s means continues and so his undertaking extends to the accounts for 2007 and 2008.[52]I have held that the application notice was issued in respect of a breach of a continuing obligation and that, in respect of bank accounts existing as at the date of the application notice, the notice enabled the applicants to seek orders in respect of Mr. Taher’s continuing breach to disclose up to date bank statements so long as the undertaking remained undischarged. However, I have also held that the application notice did not enable the applicants to seek orders in respect of a failure to disclose documents relating to an asset not in existence at the date of the application notice. The question arises as to the side of the line on which the company’s statements for 2007 and 2008 fall.[53]I consider that it can fairly and reasonably be said that as at August 2007 Mr. Taher was in breach of his continuing obligation to disclose “the latest accounts and financial statements” of Marketmaker and that that is the very obligation of which he remains in breach. I therefore reject counsel’s submission on this point. I find that Mr. Taher is in breach of the undertaking with reference to the 2007 and 2008 accounts and that such breach is a contempt.[54]Item 9.1 relates to bank account statements of Marketmaker Technology (Beijing) Co. Ltd.. None had been produced as at the date of the application notice. There was therefore a breach. In October 2007 accounts for the period June to September 2007 were disclosed and at the end of 2008/beginning of 2009 additional statements were disclosed up to December 2007 for account no. 0380 and up to December 2008 for account no. 0965. It was therefore said that there was a breach of the continuing undertaking in that the statements for January 2008 until June 2009 had not been produced for account no. 0380 and the statements for January to June 2009 had not been disclosed for account no. 0965. For the reasons I have given in relation to other bank accounts I agree with this submission. I also consider that such conduct was a contempt of court and that orders can be sought in relation to this breach by reference to the 2007 application notice for the reasons I have given earlier.[55]Item 9.8 relates to bank account statements of Forex Asia International Corporation (“FXA”). This is the holding company of the various businesses with which Mr. Taher is associated and is registered in the British Virgin Islands. Although the applicants might have expected that documents in this category would be helpful in identifying assets or income of Mr. Taher, no documents in this category have been disclosed. In November 2005, after Master Tennant had made an order in July 2005 that Mr. Taher attend an oral examination as to his assets, Mr. Taher’s shares in FXA were transferred to his mother. He then became entitled to 40% of the profits of FXA. In July 2008, shortly before he gave evidence by video link in relation to the contempt application, he appears to have given up his right to 40% of the profits of FXA and to have resigned as a director. Since he is no longer a director of FXA the documents of FXA are said no longer to be within his possession or control.[56]In essence the applicants’ case is that when the undertaking was given in March 2007 the documents were within his control, in the sense that he physically held them, as managing director and remained so until his resignation as director in July 2008 when he handed them over to his successor. That was said to be a clear breach of Mr. Taher’s undertaking.[57]Mr. Taher’s evidence is that on resignation he handed over the documents of FXA to his successor. At paragraph 489.12 of his Fifth Affidavit he himself stated that he “handed over” the documents to the new director. Those documents specifically included bank statements as is clearly stated in a schedule of documents “handed over to the new director” exhibited to an affidavit from the successor director, Mr. Jarrar. Thus there is clear evidence that Mr. Taher had documents within category 9.7 in his custody which he did not disclose to the applicants but gave to the new director.[58]Counsel for Mr. Taher, in his written submissions, invited me to consider the court’s reasoning in Mubarak v Mubarak [2003] 2 FLR 553 “that a director could not be taken to have had possession of company documents even if he had an enforceable right to them”. This written submission was not developed in oral sumissions.[59]In Mubarak v Mubarak the court was concerned with the question whether the expression “in the possession of” in RSC Ord.48 extended to documents not physically held by the judgment debtor but to sight of which he has a clear and enforceable right; see p.561 E. Hughes J. held that the expression did so extend; see p.562 B-F. However, he held that the judgment debtor in that case did not have such a right; see p.563C-G. In reaching these decisions Hughes J. noted that in B v B [1978] 3 WLR 624 “custody” in RSC Ord 24 had been held “to refer to documents which are in the physical holding of a party but not in his personal capacity, rather qua company director/agent or similarly”; see p. 561 F. He also noted that the actual decision in that case was that the party, though obliged to disclose the documents, will not be ordered to produce them for inspection; see p.562 G. I am not sure that the latter comment accurately describes the actual decision in B v B. However, it is clear from the judgment of Dunn J. in that case that whilst a party must disclose all documents in his possession, custody or power the court has a discretion whether to order inspection; see [1978] Fam.181 at pp.186 D – 187 F.[60]In the present case Mr. Taher undertook:
“(1) to disclose all documents in his control which relate to his means of paying the amounts due under the Costs Orders, including but not limited to those documents listed in the Schedule attached hereto; and (2) insofar as any documents listed in the Schedule are not in his control, to swear an affidavit explaining why such documents are not in his control and what has become of them.”
[61]The undertaking is to disclose documents “in his control”. No reason was suggested to me as to why “control” should not be understood in the sense referred to in Mubarak v Mubarak and B v B. It is arguable that it may have a wider meaning (to include possession or power cf CPR 31.8(2)) but I consider that it should at least extend to documents physically held by Mr. Taher. The evidence adduced by Mr. Taher establishes that bank statements of FXA were physically held by him until he handed them over to his successor director. I therefore find that there was a breach of the undertaking which persisted until July 2008 when Mr. Taher appears to have put it out of his power to disclose the documents.[62]It was not argued that the obligation to “disclose” contained in the undertaking meant disclose in the strict sense and did not extend to producing for inspection. Having regard to the context of the undertaking it is plain that the obligation to disclose in the undertaking extends to production of the documents.[63]Counsel said that Mr. Taher had a belief that these documents were commercially sensitive and therefore confidential. That may be so but that is not a good reason for not disclosing (or producing) them. Counsel also said that these documents did not relate to his means. However, documents which related to the income or assets of a company to whose profits Mr. Taher was entitled to 40% plainly relate to his means.[64]I therefore find that Mr. Taher was in breach of his undertaking until July 2008. There can be no doubt that his failure to disclose the bank accounts of FXA was intentional and deliberate. He then appears to have put it out of his power to disclose the documents within that category but that cannot excuse the prior breach and contempt.

Land in Jordan (categories 11 and 12)

[65]In his oral evidence on 31 July 2008 Mr. Taher accepted that he owned land in Qasr Al Halabat (category 11). No document relating to this land was produced as at the date of the application notice. That was a breach of the undertaking and a contempt. At the end of 2008/beginning of 2009 there was disclosed the title to the land in Arabic. A letter from Mr. Taher’s Jordanian lawyer stated that the land is a “large plot” of land. He said that there were 13 judgments and charges against Mr. Taher “and in turn the said plot” including charges by the Jordanian Tax Ministry, Petra Bank, the Customs Ministry and others. It is an inevitable inference from the lawyer’s letter (not speculation as suggested by counsel for Mr. Taher) that there must exist further documents concerning this land, its value and the extent to which it is encumbered. All such documents relate to Mr. Taher’s means. The breach is therefore continuing and it follows that the undertaking remains undischarged with regard to Mr. Taher’s land in Jordan.[66]Category 12 relates to any other land in which Mr. Taher has an interest. In his examination by video link he said that there are “numerous other lands” in Jordan which were owned by his father who died, according to Mr. Taher in his video link testimony, “in August 2007”, but according to his Jordanian lawyer “in September 2007”. Mr. Taher said that he was now entitled to his father’s land although the letter from his Jordanian lawyer said that it may be 2 years before he “comes into his inheritance”. No documents have been disclosed relating to this inheritance. Such documents plainly relate to his means. It was submitted in writing on his behalf that he was not obliged to disclose a potential interest (or, as I note that it was described in the written submissions served on 20 January 2009, “a mere contingency interest”) and reliance was placed on R v Barnet Magistrate’s Court ex p. Cantor [1999] 1 WLR 334. The submission was not, however, developed orally and I do not regard that case as bearing upon the question whether Mr. Taher’s inheritance relates to his means within the meaning of the undertaking given in this matter. As a matter of construction it does. His inheritance is not properly described as a mere contingency interest.[67]It might be said (though it was not in fact said) that as at the date of the undertaking the asset did not exist because his father died after the undertaking was given. However, the undertaking extends to his means when he gives disclosure. The undertaking has not yet been discharged in relation to documents relating to Mr. Taher’s own land in Jordan. The undertaking therefore extends to his inherited interest in the land formerly owned by his father.[68]Mr. Taher said in evidence that the land (“a tomato factory”) was worth £7m-£10m. It is not clear whether that referred to the land in his own name or that which he has inherited. But to whichever it refers the land is significant with regard to Mr. Taher’s means to pay the costs orders which have been made against him.[69]I was initially unsure that Mr. Taher’s father had died as at the date of the application notice, 21 August 2007. Mr. Taher’s Jordanian lawyer says that he died in September 2007. But Mr. Taher expressly approved, in his affidavit dated 10 October 2007, the contents of the affidavit of the same date sworn by Mr. Hardacre, his former solicitor, who said that Mr. Taher’s father died on 4 August 2007. That evidence was given two months after his father’s death and is likely to be true. As at 21 August 2007 Mr. Taher may therefore have been in technical breach of his undertaking but in view of the proximity of his father’s death to the date of the application notice I cannot be sure that such conduct was intentional or deliberate and so do not find him to have been in contempt as at the date of the application notice with regard to his inheritance. However, since then he has disclosed no documents regarding his inheritance in clear breach of his undertaking.

Conclusion

[70]As at the date of the application notice Mr. Taher was in breach of his undertaking in respect of documents relating to his land in Jordan (category 11), bank statements of FXA (category 9.8), bank statements of Marketmaker Technology (Beijing) Co. Ltd. (category 9.1), the latest accounts of Marketmaker Technology (Beijing) Co. Ltd. (category 8.1) and up to date statements of personal bank accounts (categories 1,2 and 4). Those breaches were a contempt of court.[71]Notwithstanding subsequent disclosure he remains in breach of his undertaking in respect of documents relating to his land in Jordan (category 11), bank statements of FXA (category 9.8), the most recent bank statements of Marketmaker Technology (Beijing) Co. Ltd. (category 9.1), the latest accounts of Marketmaker Technology (Beijing) Co. Ltd. (category 8.1) and up to date statements of personal bank accounts (categories 1,2 and 4).[72]In addition he has, since the date of the application notice, breached his undertaking with regard to his inheritance from his father (category 12), Citic account no. 0311 (category 3) and the Bank of China account (category 3). However, because these further breaches post-dated the application notice I cannot make a finding of contempt in respect of these further breaches.[73]I shall listen to any submissions which counsel for Mr. Taher wishes to make as to the appropriate penalty for Mr. Taher’s contempt.

Cited in 18 later judgments

and 9 more of the most senior