Travelers Insurance Company Ltd & Anor v Advani [2012] EWHC 623 (QB)

Case No HQ10X03676[2012] EWHC 623 (QB)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Venue Royal Courts of Justice, Strand, London, WC2A 2LLDate 16 March 2012
Before
SIR RAYMOND JACKSitting as a Judge of the High Court
Between
TRAVELERS INSURANCE COMPANY LIMITEDClaimantsDENTON WILDE SAPTEClaimantGAURI ADVANIDefendant
Justin Fenwick QC and Clare Dixon (instructed by Messrs Clyde & Co) for ClaimantsMichael Collard (instructed by Messrs Akal Solicitors) for DefendantHearing Hearing dates: 28, 29 February; 1, 2, 5, 6 March 2012
JudgmentSir Raymond Jack :Introduction
[1]Between 1995 and 2007 the defendant, Gauri Advani, was employed by the second claimant, Denton Wilde Sapte, the London firm of solicitors. The first claimant, Travelers Insurance Company Limited, was the insurer of the firm and its employees. In 2008 an action was commenced by two individuals, Mr Romy Nayyar and Mr Paramjit Singh Kang, and their companies against Denton Wilde Sapte, ‘DWS’, and Ms Advani. It was alleged by those claimants that DWS and Ms Advani were liable to reimburse them for sums totalling £383,259 which they had paid for the benefit of Mr Ashok Yadav with the intention of obtaining from Air India a general sales agency, a GSA, for the United Kingdom and Ireland. They did not get the agency and the money was lost. Their primary case was that Ms Advani had acted for them in the transaction and had been negligent, and that DWS were vicariously liable. Following a trial over 8 days Hamblen J delivered judgment on 16 December 2009. He held that the claim failed because the money was intended as a bribe to obtain the agency and so was irrecoverable: ex turpi causa non oritur actio. He held that, contrary to her case, Ms Advani had been considerably involved in the dealings with Mr Yadav, a former Tourism minister for the Indian state of Utter Pradesh, who had held out that the payments would secure the agency. He held that she had acted in the transaction as a deal broker and that in doing so she was acting outside her employment. He held that she had owed the claimants a duty of skill and care in relation to the advice and assistance she had given, which she had broken. Ms Advani had not given evidence during the trial nor called other evidence.[2]On 16 February 2010 the GSA claimants, as the claimants in this first action have been called, obtained leave to appeal from Leveson LJ against the findings of illegality and as to whether Ms Advani had acted outside the scope of her employment. Ms Advani sought permission to call further evidence. The further evidence was to explain how she had chosen not to give evidence before Hamblen J in reliance on the allegedly negligent advice of those then acting for her. Her object was to obtain a fresh trial and to overturn the finding as to her involvement in the events leading to the monies being paid by Mr Nayyar and Mr Kang. Her application was heard by Pill LJ on 27 May 2010. It was refused on the ground that it was her considered decision on advice not to give evidence: there was ‘no justification for permitting evidence of her dealings with her legal advisers to be given with the view of obtaining a fresh trial of the issues between her and the claimants.’ The GSA claimants were later required to give security for costs. Either because of that, or for other reasons, their appeal did not proceed.[3]The present action was commenced on 22 September 2010. Travelers claim £501,398 as the amount paid to fund Ms Advani’s defence of the GSA action. She had been separately represented in the GSA action and had had leading and junior counsel. It is alleged by Travelers that under the terms of the insurance policy it is entitled to recover the sums it has paid. Travelers allege that in her involvement with Mr Nayyar, Mr Kang and Mr Yadav she acted dishonestly and outside the course of her employment by DWS, and that if the court finds either or both allegations to be made out, then Travelers is entitled under the terms of the policy to be reimbursed. DWS claim £87,075. That is the amount of the firm’s costs which have not been recovered from the GSA claimants. This is sought as damages for breach of her duty to her employers in conducting herself as DWS assert that she did in connection with the GSA transaction.[4]Ms Advani’s primary defence to both claims is that she did not act as Hamblen J found that she did. She asserts her involvement was limited to putting the GSA claimants in touch with Mr Yadav and much later to trying to assist the GSA claimants to recover from Mr Yadav the monies they had paid. She denies that she was dishonest or acted outside the course of her employment. She asserts that she did not give evidence before Hamblen J because of the wrong and negligent advice of solicitors and counsel then representing her. She submits that in any event Travelers are not entitled under the terms of the policy to reimbursement. It was accepted by Ms Advani in evidence and by Mr Michael Collard’s submissions on her behalf that if she acted as it is alleged by the claimants that she acted and as Hamblen J found that she had acted, then she had acted dishonestly and outside the course of her employment. It is also accepted that, if she had so acted, she was in breach of her duty to her employers, DWS.[5]Ms Advani is qualified as a solicitor both in England and in India. She was employed by DWS not so much for her legal abilities and to do legal work but to use her connections in India to market the firm. She did do some legal work which was charged for on the usual time basis, but most of her work was not charged to any client. In addition to her salary she received a commission on the charges made for work which she brought into the firm. Until her divorce in February 2002 Ms Advani was the daughter-in-law of the then Home Minister of India, Mr Lal Krishna Advani.

The facts found by Hamblen J

[6]The facts found by Hamblen J can be summarised as follows: i) The first GSA claimant, Mr Nayyar, ran a travel business which was used by DWS, and was used by Ms Advani to arrange her flights to India and elsewhere. ii) In the summer of 2002 Ms Advani informed Mr Nayyar that there was an opportunity to acquire the general sales agency for Air India for the United Kingdom and Ireland through the person of Mr Ashok Yadav, who had at one time been the Tourism Minister for the state of Utta Pradesh. There was a meeting, probably in early July 2002 at the Marriott Hotel in Grosvenor Square. Ms Advani told Mr Nayyar that the initial term of the agreement would be four and a half years, there would be a cost, which would include legal fees. Following the meeting Mr Nayyar said he needed more information. iii) A second meeting took place at the Marriott later that month. Ms Advani said that a deposit in the rupee equivalent of £400,000 would be required, and the total cost would be £2.4 million, including legal fees of £250,000. Ms Advani said Mr Nayyar should consider involving another party in order to raise the money: it was a once-in-a-lifetime opportunity. iv) In late July there was a third meeting at the Marriott. v) In early August Mr Nayyar interested the second GSA claimant, Mr Kang, in the idea but did not tell him that the airline was Air India. vi) Mr Kang in his turn interested Mr Sen Kandiah, and this led to a memorandum of understanding being entered into by the three men, dated 15 September 2002. vii) Mr Nayyar met Ms Advani on two further occasions in August and he asked why his company had been chosen. Ms Advani said it was because Air India wanted a fresh face. Ms Advani also said she could negotiate the price down to £2 million. The need for a deposit of £400,000 remained. There was a deadline, which was approaching. She was talking to others. viii) Ms Advani had meanwhile also approached Mr Raj Kumar through a business colleague of Mr Kumar, Mr Anwar Saleem. They met with Ms Advani at the Waldorf Hotel in the Aldwych in that August. Ms Advani said that through her contacts in India she could offer an Air India GSA at a cost of £1.7 million. There would be an upfront fee of 10 to 20% to be paid in India. Ms Advani gave Mr Kumar Mr Yadav’s contact details and said he should go to India to meet him, taking the equivalent of £340,000. Mr Kumar and Mr Saleem went to India on 5 September. They met Mr Yadav. Mr Kumar said he was prepared to pay the money into an escrow account pending the appointment. Mr Yadav said that was not acceptable. Mr Kumar decided not to proceed. He informed Ms Advani what had happened. ix) On 9 September Ms Advani faxed to Mr Nayyar a letter which she had drafted for Mr Nayyar to send to the Indian Ministry of Aviation asking to be considered for the agency. She sent a further paragraph on 12 September. She said it had to be back-dated to 8 August. Mr Nayyar signed the letter. x) On 12 September there was a meeting between Ms Advani, Mr Nayyar and Mr Kang in London at the Hilton Metropole Hotel. Ms Advani told them that if the appointment letter was not issued within 72 hours of the deposit being paid, it would be returned. They expressed concern, and she said that as a UK lawyer she was their guarantee. She said her contact in India was Mr Yadav. She said he was a former minister and a close acquaintance of the aviation minister. She called Mr Yadav on her mobile and Mr Nayyar spoke to him. They then said that they wanted to go ahead. She said they would need to fly out to meet Mr Yadav. xi) Ms Advani was already flying to India on 13 September and they followed two days later. xii) On 16 September Mr Nayyar and Mr Kang met Ms Advani at her room at the Oberoi Hotel in New Delhi. They then went to meet Mr Yadav at his residence. Mr Yadav and Ms Advani said that if the letter of appointment was not issued within 3 days of the payment of the £400,000 deposit, the deposit would be refunded. The balance of £1.6 million was to be paid in two instalments within two months of the letter. xiii) On 20 September Ms Advani asked Mr Nayyar how they planned to pay the deposit and whether they had any funds for a gesture of good faith. Mr Nayyar said the maximum he could get from a bank was 900,000 rupees or £13,000. She said that this would do as a start. An assistant of Mr Yadav collected them from their hotel and went to the bank with them. No receipt was asked for or given. They returned to England on 26 September. Ms Advani had returned on 23 September. xiv) On their return Ms Advani chased them for the balance of the deposit. She said all checking and vetting had been completed and they could be awarded the agency. She gave them the bank account details of a British Virgin Islands company, Avacorp, in Hong Kong, to which the money was to be paid. £100,000 was paid on 26 September, and £270,259 on 2 October. Ms Advani supplied them with a sample Air India GSA, and asked them to make any changes they liked. xv) Mr Nayyar and Mr Kang returned to India on 6 October, and met Mr Yadav at his home on 7 October. He showed them a letter of appointment, but did not let them have it. He said it had to go through official channels first. xvi) No letter followed. Ms Advani said that there was a 45 day cooling-off period and all was well. They went to India again at the end of November, but without success. xvii) In January 2003 Mr Nayyar and Mr Kang decided to ask Ms Advani to get the monies back. She reassured them. She gave them a list of documents which were required, such as sales projections. They went about collecting the documentation and arranging for the requisite bank guarantee. On 20 March they went to India and met with Ms Advani and gave her the documentation. She advised them to stay in India until the appointment was made public. They waited for three weeks in vain. xviii) They had decided they wanted nothing more to do with the transaction, and made their displeasure known to Ms Advani. She sent communications to Mr Yadav designed to get the money back. They were dated 29 May, 11 June and 24 June. The last stated in block capitals: ‘Please return the money back Ashok Yadav and next time fool someone else – we will not leave you in peace till we have the money back.’ xix) Mr Nayyar and Mr Kang sought legal advice. On 14 May 2003 Seymours wrote a letter before action to DWS. This resulted in an internal enquiry by DWS.

The evidential position in the present trial

[7]It was not submitted by Mr Justin Fenwick Q.C. on behalf of the claimants that Ms Advani should not be permitted to give evidence with the aim of showing that she had not acted dishonestly, particularly as she had not given evidence in the first trial. He submitted that I should give weight to the findings of Hamblen J and to the evidence which he heard in so far as he accepted it. It had been asserted in paragraph 3(d) of the claimants’ reply to defence that for Ms Advani to run a case which was inconsistent with the findings of Hamblen J would be an attempt to re-litigate decided issues and a collateral attack on a decision by which she was bound, and so an abuse of the court’s process. That was precisely what she aimed to do by giving evidence as to her involvement with Mr Nayyar, Mr Kang and Mr Yadav, and Mr Fenwick was accepting that she should be permitted to do that. He accepted that if I was unpersuaded that she had been involved as the claimants asserted, then I should acquit her of dishonesty. So it did not seem to me that this was a case where the claimants could in the circumstances seek to rely on either res judicata by way of issue estoppel or otherwise, or on an allegation of abuse of process. In the course of his closing submissions I think that Mr Fenwick accepted that. Mr Nayyar and Mr Kang did not give evidence in the present action. In paragraph 25 of the particulars of claim the claimants had stated that, among other matters, they relied on the documents adduced at the first trial and on the evidence adduced at the first trial, but in relation to the witnesses called by the GSA claimants only so far as it was accepted by the judge. Mr Fenwick submitted that the witness statements of Mr Nayyar, Mr Kang and Mr Kumar, a witness called by the GSA claimants, were hearsay evidence which was admissible in this action. He submitted that as they had been cross-examined on and in so far as they had been accepted by Hamblen J, I should give them due weight. That seems to me to be an appropriate approach in the unusual circumstances of this trial. I should add that in his closing submissions Mr Collard accepted that I could have regard to the findings of Hamblen J and that I could look to see what the witnesses had said in the first action. So in the end there may not be any very substantial difference between the parties here.[8]I asked Mr Collard as to two specific matters. The first was whether it was accepted on behalf of Ms Advani that the GSA claimants had paid the sums for the benefit of Mr Yadav or his associates, which Hamblen J had found they had so paid. The second was whether Ms Advani accepted that Mr Nayyar and Mr Kang had gone to India and met with Mr Yadav on the occasions which Hamblen J found that they had. On Ms Advani’s instructions he answered ‘no’ to each. As to the visits, it is shown by their passports that they went to India when Hamblen J found that they did. I am satisfied that this was for the purpose of seeing Mr Yadav. No other reason was suggested before Hamblen J or before me. In the case of Mr Kumar a witness called by Ms Advani, Mr Anwar Saleem, had accompanied him to see Mr Yadav. As to the money, the sum said to have been collected on behalf of Mr Yadav in cash on 20 September 2002 was withdrawn from Mr Kang’s account on that day, the entry reading ‘cash withdrawal for local expenditure’. The documentary evidence also showed that the payments to Avacorp were made soon after Mr Nayyar and Mr Kang returned from India on 26 September. The only alternative scenario is that Mr Nayyar and Mr Kang used these monies for some other purpose and later invented the story that they had been paid as they said in evidence so that they could claim against DWS and Ms Advani. That is not credible.[9]I heard no evidence which showed whether in fact Air India was looking for a general sales agent for the United Kingdom in 2002. That is relevant to a wider picture but not to the issues I have to decide concerning Ms Advani.[10]In considering whether the allegations against Ms Advani are made out, I must keep in mind their seriousness. The standard of proof remains the civil standard of the balance of probability but cogent evidence is required to overcome the unlikelihood that any one, in particular a solicitor, would act in the manner alleged: per Lord Nicholls in Re H (minors) [1996] AC 563 at 586. I should also have in mind that I have not heard the evidence of the GSA claimants and their witnesses. I should have in mind that Hamblen J did not accept all their evidence and held that two of their supporting witnesses had not been present when they said that they had.

Was Ms Advani involved in attempted bribery?

[11]I do not have to decide whether Ms Advani did exactly what Hamblen J held that she did. It is enough if I am satisfied that she knew that the money in question was going to be paid, and was paid, as a bribe and was involved in the discussions which led to the payment. I am fully satisfied of that. I am satisfied that her role was to be the means of communication between Mr Yadav and the GSA claimants, and to arrange for the bribe to be paid. There is cogent evidence as to her involvement among the documents relating to 2002 and 2003. She was not honest with Mr Rosenheim of DWS when he was trying to establish the facts in 2004. It also became apparent to me during her cross-examination that she was telling many lies. A witness may lie in an attempt to improve what is at its heart an honest case, and I have had that in mind. But here her dishonesty in the witness box was only explicable on the basis that she was hoping to hide her involvement, namely that, using the phrase of Hamblen J, she was the deal broker.[12]I will begin by looking at what Ms Advani said about her involvement with Mr Yadav. She had first met him in 1994 with her husband’s parents. In February 2002 she had an invitation from him to tea at his residence. She had shortly before made a statement to the Liberhan Commission, which had attracted attention. The visit lasted half an hour. They discussed the Commission and her statement to it. In March 2002 she received a package out of the blue concerning a claim by Mr Yadav for personal injuries against Bell Helicopters. She arranged a conference call between herself, Mr Yadav and Mr D K Singh. Mr Singh was a solicitor who then shared a room with Ms Advani at DWS. She involved Mr Singh as the potential fee earner if DWS got the work. On 4 March she sent Mr Yadav a letter giving some preliminary advice as to his claim. She said that it was drafted by Mr D K Singh. She said that she had a large number of subsequent conversations with Mr Yadav, perhaps 30 or 40, in the hope of getting the job for DWS. I find that this was an exaggeration intended to account for the calls she had made to Mr Yadav, most of which were in fact related to the GSA. She said that during the telephone call about the Bell Helicopters claim Mr Yadav asked her if she had any travel agent contacts in England. He said he knew the Indian civil aviation minister, Mr Shahnawaz Hussain, and was in a position to assist an English travel agent who wished to obtain a general sales agency for Air India in the United Kingdom. She did not know what a GSA was. She did not want to ask and look foolish. It was left that she would see if she had any contacts who were interested. Mr D K Singh said it could be a good fee-earning opportunity. He did not otherwise tell her anything about a GSA : they had no discussion about what a GSA consisted of. At no time did she learn any more about the ‘GSA opportunity’. Mr Nayyar was known to her because he had a travel agency which arranged her flights. She told him of the opportunity and gave him Mr Yadav’s telephone numbers and his address. Her numerous subsequent telephone calls to Mr Yadav and Mr Nayyar came about simply because Mr Nayyar would telephone her to ask for her help in contacting Mr Yadav. She never discussed with Mr Nayyar what was happening. She never discussed with Mr Yadav what was happening. It was Mr Nayyar’s case that Ms Advani did not identify Mr Yadav to him until a meeting on 2 September 2002. That was accepted by Hamblen J.[13]The telephone records are not complete. What is available shows 439 calls and texts to or from Mr Yadav between July 2002 and June 2003. It shows 392 to or from Mr Nayyar. Some of the numbers in the records are incomplete and so cannot be identified with absolute certainty. But the strong probability is that they have been identified correctly. A number of calls were very short. Ms Advani said in respect of the calls to Mr Yadav that she would first have to speak to an aide, which would prolong the call. It is difficult to see, on her case, what Ms Advani could do by telephoning Mr Yadav which Mr Nayyar could not. The timing of some of the calls fits with crucial events. In my view the telephone evidence is a very strong pointer that she was involved as the go-between between Mr Nayyar and Mr Yadav.[14]On 23 August 2002 Mr Yadav sent to Ms Advani by email two agency agreements for India, one between Finland Airlines and an Indian company, and one between Kazakhstan Airlines and an Indian company. She said that they arrived out of the blue: she did nothing with them - she did not understand sales agreements. She said that she gave them to Mr Nayyar in 2003 when she was writing letters to help him. The agreements must be referable to the proposed GSA. The obvious purpose was to arm Ms Advani with the sort of agreement that it was being said might be entered into. It does not appear from Mr Nayyar’s witness statement that they were given to him at this time: his case, accepted by Hamblen J, was that he was given a copy of an Air India GSA by Ms Advani following their return from India on 26 September 2002. The telephone records show that Ms Advani made 8 calls to Mr Yadav on 22 and 23 August. One was for 6 minutes, one for 2 minutes and one for 3½ minutes.[15]On 28 August 2002 Mr Yadav emailed to Ms Advani a letter referring to a conference call between a representative of the National Bankcard Corporation of Chicago, Mr Shahnawaz Hussain and Mr Yadav, and a forthcoming seminar which they were invited to attend. Ms Advani acknowledged its receipt. `Her explanation was that she thought Mr Yadav wanted to show her that he had been invited to a seminar. The true purpose must have been to arm her with material showing Mr Yadav’s closeness to the minister. That is confirmed by her email to Mr Yadav of 4 June 2003, which I will come to in due course.[16]On 6 September 2002 Ms Advani drafted a letter to be written by Mr Nayyar to the Commercial Director, Ministry of Civil Aviation, New Delhi – which, as she pointed out was a somewhat inadequate address - though it might have been sufficient. On 12 September she drafted a further paragraph. The letter was back-dated to 8 August. It asked for Mr Nayyar’s company to be considered for the GSA. It was Mr Nayyar’s case that Ms Advani had required it so it could be given to Mr Yadav (then still unidentified). He said that it was back-dated because Ms Advani had told him that there was a dead-line which had to be met. Ms Advani had no explanation for the back-dating save that it was a mistake . She said everything in the letter came either from Mr Nayyar’s company’s website or from him. The letter was typed up and signed by Mr Nayyar as drafted. It was drafted shortly before Mr Nayyar and Mr Kang went to India and met Mr Yadav and paid him 900,000 rupees in cash to be followed by the payments to Avacorp. The back-dating of the letter is consistent with an intention to create a sense of urgency.[17]I come next to the letters which Ms Advani wrote to Mr Yadav in 2003. She said that until then she had not been told by Mr Nayyar or Mr Kang anything of what had occurred between them and Mr Yadav.[18]The first is an email dated 19 May 2003. She said:
“It has been sometime that I have spoken to you on the phone or indeed your mobile, …, which has been switched off for over two weeks now. I have left several messages at your residence which either have not reached you or indeed you have sadly not answered. This is indeed violative of all ethics of good business norms. May I please kindly request that you call me ASAP so that you and I may talk and I may know more what the Real Position is. It is very difficult to go on making excuses on your behalf any more. The party now want to contact the representatives of the Non Resident Indian Community on their behalf.”
Ms Advani’s case was that at this point she did not know that money had been paid, but only that there were problems with Mr Yadav: Mr Nayyar and Mr Kang did not know if they were going get the agency: would she write to Mr Yadav? It is highly unlikely that, assuming she did not know already, she would not have been told about the money. For the money was the problem. Quite apart from that this is not the letter of a solicitor who has just been informed that an introduction made by her has resulted in discussions which have petered out. I refer also to the reference at the start to speaking on the telephone and to the reference to excuses.[19]On 29 May she sent a longer letter by fax. She stated first that ‘the party’ thereby terminated all arrangements regarding ‘the present matter’. She said Mr Yadav had informed her of his close friendship with the minister and that he had his complete backing, and that the minister had given him the mandate for the GSA for Air India for England. She wrote:
“To this end you requested and accepted on behalf of [the minister] a payment of RS Three Crore’s (as first instalment) which were paid by the party to you immediately, all together and in One Lump Sum into your Bank Account details of which are with us. Unfortunately the party concerned have waited in vain … . It was unanimously considered that your attitude was amateurish, unprofessional … . In the early days you called the party and myself several times a day – then once in ten days – but of late you stopped and moreover ceased all communication and even refused to answer any calls. I have left innumerable messages …. .”
She asked that the money should be repaid immediately.[20]On 4 June Ms Advani sent a short email saying that ‘the party’ wanted to make a complaint to the Non-Resident Indian Community in London and to the Central Vigilance Commission in the Home Ministry in New Delhi. She said that Mr Yadav could not say he was not representing the minister because in August 2002 he had passed her the letter I have referred to above, which was emailed to her on 28 August 2002. She said that it was in everybody’s interest that Mr Yadav responded.[21]On 5 June Ms Advani sent Mr Yadav an email saying that ‘the party’ was thinking of giving the story to the press and his credibility would be damaged for ever.[22]On 17 June Ms Advani sent Mr Yadav by fax a letter headed Misrepresentation and Fraud. She referred to an assurance to herself and the party that he had the minister’s complete backing, and that he had given Mr Yadav the mandate for the selection of the GSA: to that end he had requested and received the three crores. She referred again to the numerous telephone calls to the party and to herself in the early days and their cessation. She said: “It goes without saying that the delay, laxity and non-performance from your side has caused us severe loss of precious time …. . This is a clear matter of Fraud, Cheating and Embezzlement on your part.” [Her underlining] She then asked for immediate repayment. The letter ended by saying that otherwise the Central Vigilance Committee would be informed. The letter makes no complaint that a bribe has been paid and accepted. It complains that it has been received without the agency being delivered. It is not the letter that would have been written if Ms Advani had learnt in that May what had followed from her introduction of Mr Nayyar to Mr Yadav.[23]On 19 June Ms Advani sent to her twin sister, Dr Gopa Sabharwal, a draft of a letter to the minister. The draft began by referring to her conversation with the minister and expressed the hope that copies of earlier communications concerning Mr Yadav had reached him. It suggested that the minister should get Mr Yadav to return the money to avoid the damage that the dishonesty and sleaze could do to the government. Dr Sabharwal replied that it was a good letter and that she hoped the minister would react ‘quick and fast’. Ms Advani replied ‘Thank you Sis. If he has brains he should act.’ It is unclear whether the letter was in fact sent.[24]Finally, on 24 June 2003 Ms Advani sent the email which I quoted in my summary of the judgment of Hamblen J. It was in enlarged block capitals and underlined:
“Please return the money back Ashok Yadav and next time fool someone else – we will not leave you in peace till we have the money back.”
[25]The effect of this correspondence is to show that Ms Advani had been involved in the dealings with Mr Yadav. It is inconsistent with her only having learnt in May that her introduction had led to the payment of money intended as a bribe.[26]I will take next the evidence as to three important meetings.[27]The first was found by Hamblen J to have been held late on 12 September 2002 at the Hilton Metropole in London and to have been attended by Mr Nayyar, Mr Kang and Ms Advani. Hamblen J found that at this meeting Ms Advani had said that as a UK lawyer she was their guarantee for the return of the deposit if the GSA was not forthcoming. Ms Advani’s case was and is that there was no such meeting. Hamblen J recorded that the meeting was strongly challenged by her counsel in cross-examination, and he referred to the various points which were made. He rejected the evidence of Mr Bopari, a friend of Mr Kang, who said that he had driven Mr Kang to the meeting. He referred to the likelihood of such a meeting taking place before Mr Kang committed himself to going to India and making any payment. Mr Kang had not previously met Ms Advani.[28]Ms Advani’s case was that on that evening she had a business meeting with Mr Arun Shori, which led to them having dinner together. That ended at about 11.30 and he then saw her back to her flat in Belsize Park by taxi before returning to his own flat in Westminster. Mr Shori and Ms Advani had a professional relationship in 2002. They began a personal relationship in 2004. Mr Nayyar and Mr Kang said that their meeting began at almost midnight because of Ms Advani’s busy work schedule. Mr Kang put in evidence a credit card payment for refreshments at the hotel on 13 September, which fits with the meeting continuing after midnight. If Mr Nayyar and Mr Kang invented this meeting it is odd that they should choose such an unlikely hour. The telephone evidence fits. There were 15 calls between Ms Advani and Mr Nayyar on 11 September, many of them of substantial length. There was one brief call to Mr Yadav. On 12 September there were 27 calls between Ms Advani and Mr Nayyar. There were calls at 21.05, 21.22, 23.05, 23.13 and 23.19 when they ceased. Ms Advani made 5 calls to Mr Yadav between midnight and 1.51 on 13 September. They were brief, but the significance is that she was calling him at that time. India was then 4 ½ hours ahead. She made brief calls to Mr Yadav’s number at 13.56, 13.59, 15.21 and 15.48 the next afternoon followed by one of 4 ½ minutes at 16.13. There were 12 calls between Ms Advani and Mr Nayyar between 13.56 and 22.59 including calls of 35 ½ minutes, nearly 17 minutes and over 6 minutes. I am satisfied that the meeting took place and I have no reason not to accept the important elements of the account given by Mr Nayyar and Mr Kang. I do not accept that Mr Shori saw Ms Advani back to Belsize Pak before returning to his flat. This meeting and the calls following it laid the ground for Mr Nayyar and Mr Kang to go to India on 15 September.[29]It was the case of Mr Nayyar and Mr Kang that they met Ms Advani in her room at the Oberoi Hotel in New Delhi on 16 September 2002 and then went with her by car to Mr Yadav’s home. Ms Advani said that she had no such meetings.[30]Hamblen J accepted that meetings took place as alleged by Mr Nayyar and Mr Kang. He rejected the evidence of their supporting witness, Mr Tanzy Nayyar, who said he had driven them to the Oberoi and seen them go off to see Mr Yadav. So that was the second time that the judge found that Mr Nayyar and Mr Kang had attempted to gild the lily.[31]When DWS received the GSA claimants’ letter before action their partner, Mr John Rosenheim, sought to investigate with Ms Advani what had happened. He did so by email. Ms Advani had left England on 13 September 2002 arriving in Delhi on Saturday 14 September. She was due to fly back on 17 September, but her stay was extended by reason of the severity of the pre-existing illness of her father and his being admitted in to hospital to intensive care on 22 September. She left on 23 September. This is a visit which she would certainly have remembered in May 2004. On 27 May 2004 she told Mr Rosenheim that the only visit she had made to India in 2002 was for her divorce that February. On 16 July she said that she was in India in September 2002 on a strictly private visit following her divorce, and that when real clients required her to travel to India she always insisted on a letter of request from them. On 20 July at 9.42 she received by email from the Oberoi a copy of her bill from the Oberoi. The bill showed calls to Mr Yadav on 16, 17, 18 and 20 September 2002, the calls being spread over two pages. At 13.00 on that day she emailed to Mr Rosenheim that her visit to Delhi had been caused by the sudden deterioration in her father’s health, who was admitted to intensive care during her stay and was there when she left. At 14.47 she said that she had been going through her files and had found a fax dated 9 September 2002 from the Hinduja Group company, Ashok Leyland, requesting her presence for legal discussions in the week commencing 16 September. It appears that she had obtained a copy of the letter by email from India at about 13.34 British summer time. At 19.12 she said that she had called the Oberoi where she was staying and found that her room number was 528 and not 638 as alleged by Mr Nayyar and Mr Kang. On 21 July at 18.05 she said that she had no meetings with Mr Nayyar and Mr Kang as alleged by them and had simply given Mr Nayyar Mr Yadav’s telephone number. I note that the number she quoted was different to that on the Oberoi bill. On 23 July she gave permission for all her communications to be examined. On 19 August Mr Rosenheim asked her to confirm that while she was in India in September 2002 she had had no contact with Mr Yadav, Mr Nayyar or Mr Kang, and asked for a copy of the Oberoi bill. On 23 August she replied that she had had no contact with Mr Yadav ‘regarding this matter’, nor with Mr Nayyar or Mr Kang save that she might have communicated with Mr Nayyar as her travel agent. She said that as she had stated she had spoken to the Oberoi and would arrange for something to be sent in writing. On 6 September Mr Rosenheim asked if she had been in touch with Mr Yadav at all during her visit. She replied the same day that she had not. Meanwhile she had arranged for her sister to fax her on 23 August a copy of the first page of the Oberoi bill with all the items charged deleted. This was provided by her to Mr Rosenheim. It was her case that the bill had been redacted by the Oberoi without any request. This history is only consistent with a desire by Ms Advani to conceal what had actually happened on her September visit.[32]The telephone records show that Ms Advani made 7 short calls to Mr Yadav on 14 September, 2 on 15 September, 3 on 16 September – one of over 2 minutes, one on 17 September for over 6 minutes and 6 calls on 18 September. Over the same period there were 13 calls between her and Mr Nayyar. In her evidence to me she said that although she spoke to Mr Nayyar because he was having trouble contacting Mr Yadav she did not know that like her he was in India. In her witness statement of 19 June 2009 she had said that she knew he was there.[33]Ms Advani’s case is that she spent the time when she was alleged to have been with Mr Nayyar and Mr Kang visiting her parents. She said that she could identify the day, Monday 16 September, because it was the day after her nephew’s birthday and because she had missed so many birthdays it was important for her to see him. Why she could not have seen him on his birthday, the Sunday, was unclear. Both she and her sister Dr Sabharwal gave detailed evidence as to what had occurred and there was supporting evidence in the statements of two further witnesses from India who did not attend the trial. I am satisfied that this evidence was false. I refer to Ms Advani’s attempts at concealment from Mr Rosenheim, which I have set out. I refer to the telephone evidence. This included calls when she was said to be sitting at table having a family dinner. It is improbable that Ms Advani and her witnesses could remember that evening in the detail with which they purported to remember it after 6 years. With regard to Dr Sabharwal it is significant that she purported to remember Ms Advani’s personal security officer, a matter I will come to. She was also involved in the obtaining of the redacted bill from the Oberoi. She was involved in the correspondence in 2003, as I have related. The evidence of Mr Nayyar and Mr Kang was tested before Hamblen J and was accepted. I too should accept it.[34]A matter which was emphasised by Ms Advani before me was that she had at all times until 2006 been accompanied when she was in India by a personal security officer provided by the Indian Government. She said that whenever she arrived in India a security officer would be waiting for her at the airport. She said she never gave advance warning of her arrival and never said how long she would be staying. She did not know how it was arranged. Yet the officers were always there. That is not credible. She said that she often had the same guards called Juginder and Ashok. She provided a document which she said established the truth of what she was saying. It seems to be a letter issued in 2002 concerning security for an event or period in that year. It has been heavily redacted, and the redactions seem to be more those which might be made to conceal the ambit of the letter rather than those which might be made for security reasons. She and Dr Sabharwal said that they had not referred to this evidence previously because their lawyers, in particular Ms Plumb of Kennedys, had told them that they could not include anything in their witness statements which was not supported by a document. That is plainly nonsense and both their witness statements of course contain such material, for example as to what happened on 16 September 2002. There is one reference to the topic in the attendance notes disclosed for the purpose of Ms Advani’s application to the Court of Appeal. On 15 September 2009 Ms Advani had a 6 hour meeting with Ms Plumb and a trainee. In connection with the statement of Tanzy Nayyar she said that during 2001 – 2002 she had a bodyguard supplied by the Home Office, and that this body guard was a government employee and a spy sent on behalf of her father-in-law during her divorce. Ms Plumb asked if it would be possible to find out who the guard was on that day. Ms Advani said that Ms Plumb would need to contact the Indian Home Office, but would not get anywhere. There the matter appears to have rested. It was not raised in Ms Advani’s application to the Court of Appeal, nor in her first witness statement in this action. One may ask how it helps her case. It is highly unlikely that even if the relevant officer could be identified he could have given useful evidence in 2009. It was said that there would not have been room in the car if he had accompanied them to Mr Yadav. That, it seems to me, depends on the size of the car. I do not think that the evidence assists Ms Advani’s case but rather the contrary. I should say that I do accept that at some point Ms Advani was provided with protection, but it was not in the circumstances she relies on here. There was a newspaper article apparently dated 11 November 2005, which mentions her as a person to whom security had been provided.[35]The third matter by way of meeting which I should refer to relates to March 2003. It was relied on in Mr Collard’s closing submissions. Between 19 and 27 March 2003 Ms Advani was staying at the Taj Mahal Hotel, New Delhi. It was the case of Mr Nayyar and Mr Kang that they had come out to India and at her suggestion moved from the Hyatt Regency to the Taj. Mr Kang exhibited his bill from the Taj Mahal. Ms Advani denied the two were there. In her first witness statement in this action she produced an email from the Taj Mahal Hotel dated 7 July 2011 saying that Mr Kang’s bill was not genuine, and that there was no record of the two men having stayed at the hotel. This evidence was not challenged on behalf of the claimants, probably on the basis that their evidence they had adduced was sufficient for them to succeed in showing Ms Advani’s earlier involvement. I make no findings about this matter. I have of course quickly compared the photocopy bills of Ms Advani and Mr Kang, and I saw no difference in the format. Mr Kang also produced his credit card slip showing payment to the Taj Mahal Hotel on 28 March 2003.[36]The last matter I must deal with in connection with Ms Advani’s involvement with Mr Yadav is the evidence of Mr Raj Kumar. Mr Kumar gave evidence to Hamblen J for the claimants. His story was that he had met Ms Advani in the company of a mutual acquaintance, Mr Anwer Saleem, and she had told him about the GSA opportunity. After a number of meetings with Ms Advani in which he was told an advance payment of approximately £340,000 was needed, he went to India with Mr Saleem, but not Ms Advani, and they went to see Mr Yadav. Mr Yadav asked him where the money was. He said he had it but it was at his farmhouse. Mr Yadav said a guard could accompany him to collect it. Mr Kumar said that would not be necessary because he could pay the money into an escrow account. Mr Yadav would not accept that. In due course Mr Kumar concluded the meeting. He did not think that the refusal of an escrow account was normal and he decided not to proceed with the transaction. Mr Kumar’s evidence was accepted by Hamblen J. He did not give evidence before me. The evidence before me of Ms Advani and Mr Saleem was that she had only one meeting with Mr Kumar. Mr Saleem said that at no time was there ever any requirement of a payment to Mr Yadav. He said that it was understood that in due course Mr Yadav would get something for the use of his influence, but it was not discussed. He said that at the meeting in New Delhi with Mr Yadav Mr Kumar had wanted Mr Yadav to provide an appointment with the minister, which Mr Yadav in effect refused to do. They concluded that Mr Yadav could not deliver, and so took the matter no further. Despite the work that had been done on the project in England including the inclusion of a further investor they took the matter no further. No enquiries were made about the GSA at Air India or the Ministry of Civil Aviation. I found Mr Saleem’s account of the meeting with Mr Yadav unconvincing. The events concerning Mr Kumar are not central to the matters I have to decide, but I do find here further evidence of Ms Advani’s involvement in the procuring by Mr Yadav of a bribe in connection with the GSA.[37]It may be asked why Ms Advani was involving herself with Mr Yadav. This was not a matter which was investigated before me. Hamblen J found that the total cost of getting the GSA including the deposit of £400,000 was to be £2 million. That was to include £250,000 for legal fees. In paragraph 154 of his judgment Hamblen J held that the £250,000 was effectively to be Ms Advani’s commission for broking the deal.[38]Ms Advani blames those acting for her in the first trial for the fact she did not give evidence. In a long email on 21 November 2009 Ms Plumb set out that it was at the end of the day Ms Advani’s decision whether to give evidence. She referred to the concern of Ms Advani’s advisers that if she went into the witness box there was a real risk that her evidence would not be accepted and it would be found she played a larger role than she admitted, and she would be found dishonest. That was sound advice.

Travelers’ claim under the policy

[39]On 12 January 2005 Barlow Lyde & Gilbert wrote a letter to Ms Advani reserving Travelers’ and DWS’s rights in connection with the allegations made against her.[40]Clause1.4.1 of the policy provides an indemnity against defence costs against claims covered by the policy. Clause1.4.2 states; 1.4.2 The Insurer will indemnify each Insured against Defence Costs as and when they are incurred, including Defence Costs incurred on behalf of an Insured who is alleged to have committed or condoned a dishonest or fraudulent act or omission giving rise to a claim provided that the insurer is not liable for Defence Costs incurred by or on behalf of that Insured after the earlier of—(a) that Insured admitting to the Insurer the commissioning of dishonest or fraudulent act or omission; or(b) a court or other judicial body finding that Insured was in fact guilty of such dishonest or fraudulent act or omission. Clause 6.9 provides: 6.9 Fraud or dishonesty Insurers are not liable to indemnify any insured to the extent that any civil liability or related Defence Costs (other than as provided in clause 1.4.2) arise from dishonesty or a fraudulent act or omission committed or condoned by that Insured, except that— (a) this contract nonetheless covers each other Insured; and (b) no such dishonesty, act or omission will be imputed to a body corporate unless it was committed or condoned by all the directors of that body corporate. Clause 7.10 provides: 7.10 Reimbursement of moneys paid pending dispute resolution Each Insured will reimburse the Insurer following resolution of any coverage dispute for any amount paid by the Insurer on that Insured’s behalf which, on the basis of the resolution of the dispute, the Insurer is not ultimately liable to pay. Clause 8.5 defines ‘Defence Costs’. It is unnecessary to set it out.[41]Travelers claim under clause 7.10. They say that if I find that Ms Advani acted in a way which was dishonest or which was not within the firm’s practice, then there has been the resolution of a coverage dispute in its favour and Ms Advani is obliged to repay the costs which Travelers paid on her behalf pursuant to its obligation under clause 1.4.2. It is agreed between the parties that if she involved herself in the negotiations between Mr Yadav and Mr Nayyar and Mr Kang in the manner alleged by Travelers in the knowledge that a bribe was to be paid she was both dishonest and acting outside the course of her employment, that is, outside the firm’s practice.[42]On behalf of Ms Advani Mr Collard accepted in his closing submissions that if a coverage dispute had been resolved then clause 7(10) gave a right of reimbursement. He also accepted that Travelers could have sought a declaration from the court as to Ms Advani’s dishonesty and on the basis of that could have gone on to claim reimbursement in the same action. But, he submitted, Travelers could not proceed as it has.[43]On 29 January 2010 Barlow Lyde & Gilbert acting for Travelers wrote to Withers LLP, who were then acting for Ms Advani’s, saying that Ms Advani had been found to be dishonest by Hamblen J and requiring that she repay the costs paid on her behalf. By letter of 12 February Withers replied that Hamblen J had not found Ms Advani to have been dishonest. I comment that he did not describe her conduct as dishonest but what he found her conduct to have been was plainly dishonest, as is now accepted. But in any event the coverage dispute was defined in the pleadings in this action and I have resolved it in favour of Travelers. It follows that they are without more entitled to the indemnity which they seek. The figure is agreed at £501,398.71.

The claim of DWS

[44]It is admitted that it was a term of Ms Advani’s contract of employment that she should act honestly. No argument was run that if her dishonesty fell outside the course of her employment, it would not be a breach. Nor could such a submission succeed here. For the obligation must clearly extend to conduct closely related to the firm in the way it did here. As a result of Ms Advani’s dishonesty DWS were drawn into the action brought by the GSA claimants, as was wholly foreseeable. The claim succeeds. The agreed figure is £87,075.29.