Al-Khyami v El-Muderris [2018] EWHC 24 (QB)

[2018] EWHC 24 (QB)Case No HQ16X00866
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Venue Royal Courts of Justice, Strand, London, WC2A 2LLDate 19/01/2018
Before
MASTER DAVISON
Between
AMRE AL-KHYAMIClaimantHAYDAR EL-MUDERRISDefendant
Mr William McCormick QC (instructed by Carter-Ruck) for ClaimantMr Fraser Campbell (instructed by Mishcon de Reya) for DefendantHearing Hearing dates: 11th to 14th December 2017
Judgment ApprovedMaster Davison :Introduction
[1]This is a claim for damages for the conversion of 11 items of luxury goods: 3 Audemars Piguet watches, 5 Rolex watches, 2 Cartier bangles and a Cartier necklace. Together these items are said to have a retail value of some £668,500. The defendant is said to have taken the items from the safe of a garage business in George Street, Mayfair. This was the business owned and run by a Mr Ziad Showai, to whom the claimant had entrusted the items. The taking of the items by the defendant is said to have taken place at some time in December 2013 or early 2014. The defendant is alleged to have gone on to sell or deal with at least five of the items.[2]The case was introduced by Mr William McCormick QC for the claimant as “an old-fashioned swearing contest” and the description is not inappropriate because the outcome does to a significant extent depend on whether I accept the account of the claimant or that of the defendant. However, those accounts were both incomplete and (as I find) unreliable. A key witness, Mr Showai, was simply absent. Much has remained shrouded in mystery. In these circumstances, I have tried to adopt the approach commended by the Court of Appeal in Commissioner of Customs & Excise v A [2002] EWCA Civ 1039, paragraphs 82 - 84. I have tried to give reasoned decisions on those issues of fact which are central; but not to deal with every peripheral issue the resolution of which does not affect the outcome of the claim. It is not my function to try to unravel and explain the complex dealings between all the protagonists involved. My function, put shortly, is to decide whether the claimant has proved his claim.[3]I find that he has not. The account of the claimant[4]The claimant, also known as Omar Khyami, is a businessman. Until July 2012, he was in a relationship with Tamara Ecclestone – one of the daughters of Bernie Ecclestone of Formula 1 racing fame, and an extremely wealthy woman. During the relationship she regularly bought the claimant expensive gifts, including (on the claimant’s initial account) all the items claimed in these proceedings. These are:(1) Audemars Piguet Las Vegas Edition watch: £80,000(2) Audemars Piguet Rose Gold Offshore watch: £42,000(3) Audemars Piguet Offshore Tourbillon Chronograph watch: £240,000(4) Rolex White Gold GMT2 watch with diamonds: £86,000(5) Rolex Yellow Gold GMT2 with diamonds: £76,000(6) Rolex Gold Daytona watch: £28,000(7) Rolex Chocolate Daytona: £26,000(8) Rolex GMT II steel and gold bracelet: £8,500(9) Cartier White Gold diamond Love Bangle: £37,000(10) Cartier Yellow Gold diamond Love Bangle: £28,000(11) Cartier Necklace with Heart-Shaped diamond: £17,000[5]In April 2012, the claimant took delivery of a Lamborghini Aventador motor car which Ms Ecclestone had bought from Elite Performance Cars Ltd (“Elite”) of George St in Mayfair. This was the garage business of Mr Ziad Showai, referred to above. Mr Showai was a friend and business associate of the claimant. When the relationship with Ms Ecclestone ended, there was a dispute about the ownership of the car and Ms Ecclestone brought a claim against the claimant and against Elite and another party in respect of this. (The claim as against Mr Khyami was settled. But as against the other defendants it proceeded to a trial before Dingemans J, which took place in November 2013; see Ecclestone v Khyami [2014] EWHC 29 (QB)).[6]The claimant’s account is that when the High Court case arose, he “felt he ought to ensure that the items were stored securely”. The place that he chose for the custody of the items was the safe located at the garage premises of Elite. Mr Showai “was happy for me to store the items in his safe”. At some time in the summer of 2013 “I placed all the items (save items 5 and 6) in the safe”. Items 5 and 6 were already there, having been placed there with one other watch as security for a loan of £250,000 in the claimant’s favour from Elite. Additionally, the claimant says he placed a Yellow Gold Chain with Pendant (“the tiger necklace”) and Theo Fennel Key Necklace (“the key necklace”) into the safe. These two items had also, on the claimant’s account, been gifts from Ms Ecclestone.[7]The claimant said that the debt to Elite was cleared in early November 2013 so that from that point onwards he had clear and unencumbered title to all the items in the safe, including items 5 and 6.[8]In February 2014 the claimant asked Mr Showai for his items to be returned to him. He was told that the contents of the safe had been “relocated” during a refurbishment of the showroom in December 2013 but that they were in a safe place with a third party. It was not until March 2014 that Mr Showai told him that the third party was the defendant, Mr El-Muderris. Mr El-Muderris was known to the claimant as an “investor” in the garage business and someone who, in that capacity, had access to the safe.[9]At this point Mr Showai also disclosed to the claimant that he was in dispute with the defendant over a loan that he / Elite had taken from the defendant. The amount in dispute was the interest on the loan, which was claimed at £280,000.[10]The claimant says he then received a phone call from the defendant, who arranged a meeting at a mobile telephone shop he owned on the Edgware Road, “Digital House”. At this meeting he told the claimant that he and Mr Showai had fallen out; that he had four of the watches in his possession, these being items 1, 3, 4 & 5; and that, as to the others, “Mr Showai had probably pawned them”. He asked the claimant to pay him his £280,000.[11]The claimant reported back to Mr Showai, including a report of the allegation that he had pawned the other items – something Mr Showai vehemently denied and took the claimant to his pawnbroker to confirm. The next day, the claimant received a further call from the defendant and a second meeting at Digital House was in due course arranged. There were WhatsApp exchanges between them referring to the meeting, which took place on 27 March 2014. At this meeting, rather than speaking, the defendant is alleged to have written on a piece of paper the descriptions of four watches and a figure - £285,000.[12]Faced with what he regarded as an attempt to extort money from him, the claimant played along with the defendant by telling him that he would have the money by the end of the month. There was a third meeting on 17 April 2014 at Digital House at which the defendant gave him instructions for the transfer of the money and told him that the watches were being held at a jewellery shop in Knightsbridge.[13]On 29 April 2014 the defendant rang the claimant to ask if they were “all set” and a fourth meeting was arranged for the next day at Digital House. Prior to this meeting, the claimant reported the matter to the police at Charing Cross Police Station. The meeting went ahead. The claimant said he would pay £14,000 the next day. The defendant told him in a WhatsApp message to pay it to Hassan Kassab of H & Y Jewellery of Beauchamp Place in Knightsbridge. The claimant went there the next day (1 May 2014) only to be told by Mr Kassab that he did not have the watches.[14]The “dialogue” between the claimant and the defendant then broke down.[15]On 24 May 2014, the claimant was telephoned by a friend, a Mr Simon Lee, with the information that he (Mr Lee) had been called by the defendant or by “Husain” – a business associate of the defendant – who had offered two of the Rolex watches, items 4 & 5, for sale. He forwarded to the claimant two photographs posted (probably as part of the defendant’s user profile) on WhatsApp showing the defendant’s hand displaying these watches. The claimant took screenshots of these images.[16]Then, in June 2014, the claimant learned that the defendant had given the tiger necklace and the key necklace to Tamara Ecclestone. These items had been in the safe and the claimant inferred that they too had been taken by the defendant. He alleges that the defendant’s motive in giving them to Ms Ecclestone was “to make trouble for me” – something in which he succeeded because she told the police that they had been stolen from her. This led to criminal charges against him, albeit that those charges were eventually dropped and he and Ms Ecclestone were able to agree a settlement of that and other disputes between them. Because of that settlement, these items have been omitted from the claim and have come to be referred to as “the excluded items”.[17]A formal letter demanding the return of the items was sent by Carter-Ruck acting for the claimant on 31 July 2015. Although the claimant had no direct evidence that the defendant had taken items 6 – 11, the claim in respect of those items was said to rest on the inference that if items 1 – 5 and the excluded items had been taken then it was likely that the other items had been taken at the same time. These proceedings were commenced on 9 March 2016. The account of the defendant[18]The account of the defendant is shorter and simpler.[19]The defendant is a businessman whose interests include lending money and buying and selling watches. He is a collector of Audemars Piguet watches. He says that he acquired items 1 and 3 in August 2012 from Mr Hassan Kassab, a jeweller, to whom the watches had been sold or pawned (the precise details of the transaction did not concern him) by the claimant a month earlier. He paid £85,000 for them, which he could prove by reference to bank transfers. The third Audemars Piguet watch (item 2) he had never had – though he knew that the claimant and/or Mr Showai were trying to sell it and he was at one point interested in buying it. He did have conversations, meetings and WhatsApp exchanges with the claimant about items 1 and 3 in or around March and April 2014. But this was because the claimant was trying to re-acquire the watches – for which he offered £170,000. But he never came up with the funds and so the defendant sold one watch to a third party and gifted the other. He was able to produce a cheque for £50,000 in his favour dated 27 May 2014 which was part payment for the watch he sold.[20]This part of the defendant’s account relied upon the hearsay evidence of Mr Kassab. The claimant obtained an order under CPR r 33.4 and served a witness summons on Mr Kassab requiring him to attend for cross-examination. He attended, gave evidence and produced a document which were very much in line with the account of the defendant. The defendant also called Mr Mohammed Ridha, a former employee of Elite. Mr Ridha corroborated the defendant’s account of a sale by the claimant of the Audemars Piguet watches to Mr Kassab. (Mr Ridha gave important evidence about other matters too. That evidence is referred to below.)[21]As to items 4 & 5 (the Rolexes) the extent of his dealings with these was to post a picture of each one as his profile picture on WhatsApp in order to accommodate a request from Mr Showai (in whose possession they then were) who wanted to offer them around to find out what they were worth. The defendant had hundreds of WhatsApp contacts and this was simply a way of generating sales interest in the watches. He personally – as opposed to Mr Showai – was not selling them. He was helping Mr Showai to sell them.[22]As to the “excluded items”, he had bought these from the claimant for £15,000 cash in August 2013. He had in fact been away on holiday in Turkey at the time and the purchase had been concluded by his friend and associate Mr Bashar Al-Safee. Several months later he received a call from Ms Ecclestone’s PA to the effect that these items had been stolen from her. He also got a call from Bernie Ecclestone and subsequently Notting Hill Police. He then returned the items to Ms Ecclestone, for which both she and her father thanked him.[23]The defendant maintained he had never had any other items. He put the claimant to proof of his ownership / right to possession of all of them.[24]He denied having access to the safe, which was, in any event, covered by CCTV. He said, with some emphasis, that as a man of good character it was absurd to suggest that he would steal items from a safe. He would never have risked his family, his business and his reputation in that way. Discussion[25]When the case came before me on 10 November 2017 in the context of an application by the defendant for specific disclosure, I noted that the core issues for trial were these: i). The claimant’s ownership or right to possession of the claimed items. ii). Whether all or some of them were placed in the safe by the claimant and if so why and on what terms. iii). Whether any of the claimed items (and the excluded items) were taken unlawfully by the defendant. This involved consideration of his explanations for his admitted possession of items 1 and 3 (the Audemars Piguet watches), his admitted handling of items 4 & 5 (the Rolex watches he was photographed wearing) and his admitted possession of the excluded items.[26]It’s convenient to deal with the specifics of issue (iii) first. That issue sub-divides into an examination of the transactions in respect of the Audemars Piguet watches, the Rolex watches and the excluded items. Everything else falls into place behind my findings on these transactions. But before coming to these transactions I will make some observations about the credibility of the claimant and the defendant. The credibility of the claimant and the defendant[27]Each side attacked the other’s credibility and neither emerged well. I found the claimant to be a very unsatisfactory witness. Mr Campbell for the defendant submitted that he was about as unreliable as a witness ever could be and it was some measure of the sheer abundance of the material that he had to deploy that he was able to develop a six-fold classification of Mr Khyami’s failings in this regard. I will not recite all the failings. Suffice it to say that time and again in cross-examination it was demonstrated that he had been careless of the truth or downright misleading. I will come to various examples in the context of the particular transactions under scrutiny. I will mention only one example at this point because the claimant’s explanation of his inaccuracy on this occasion gave an insight into his mindset. In May 2014, the claimant reported the Audemars Piguet watches as stolen to Audemars Piguet in Paris. (The manufacturers of high-end watches maintain their own registers of stolen goods.) Audemars Piguet eventually came to instruct a Mr Simon Airey of DLA Piper solicitors. This was in the context of an email from the defendant who had told Audemars Piguet that the claimant had at one stage pawned the watches. The claimant wrote Mr Airey an email on 14 January 2015. The email stated that these were “not watches you take to a pawn shop”. They were too valuable for that. He stated that he could “confirm that they were not in any pawn shop”. But this was incorrect. He had himself pawned two of these watches in 2013, redeeming them on 13 and 29 May of that year. A small matter. But the explanation was revealing. The claimant said that this had simply been the “easiest thing to say”. The fact that the watches had been pawned “made no difference”. “I was just putting it in a simplified way to someone who had no idea of what’s going on.”[28]The claimant offered an explanation along similar lines for other lapses. What it came to was that as long the general thrust of what he was saying was correct and as long as right was on his side, the strict accuracy of the truth did not matter.[29]The claimant also displayed a regrettable tendency to blame inaccuracies on others and to improvise or embroider rather than to acknowledge fault and withdraw or modify his position.[30]The conclusion that I reached was that I could place little or no reliance on what he told me. Where his evidence was in conflict with documents or with the evidence of Mr Kassab and Mr Ridha, I preferred the latter. Further, where there was a simpler and more generally plausible explanation for a matter placed in issue by the claimant’s evidence, it was the simpler explanation I preferred.[31]The defendant was not much better. He lied about the circumstances in which he came to acquire the excluded items. And the purpose of the lie was to make trouble for Mr Showai, and the claimant. He too lied (or was at the least misleading) in his communications with Audemars Piguet. He was taciturn and economical with the truth of how he came to be pictured wearing items 4 & 5. In the context of his own claim against Mr Showai in May 2014 (which concerned a loan) he uttered threats towards Mr Showai and Mr Showai’s family in extremely intemperate language.[32]He was not quite so unsatisfactory a witness as the claimant. He was prepared to admit and acknowledge instances where he had lied and do so without blaming others and without improvisation or embroidery. Whereas with the claimant I concluded that I could place no real reliance on his evidence, with the defendant I concluded that he was, by the time of the trial anyway, for the most part trying to give accurate evidence. But I do not think that he told me the whole truth.[33]I have not, of course, decided this case solely on the basis of the credibility of the claimant and the defendant. That is only one part of the picture. In relation to the disputed incidents or transactions I have tried to consider systematically:(a) the admitted or undisputed facts relevant to the incident or transaction;(b) any objective evidence bearing on it;(c) if available, the evidence of independent witnesses; and(d) all the surrounding circumstances, including the general probability or plausibility of their respective accounts, and whether they have been consistently maintained.[34]With that introduction, I turn to the issues as they are set out in paragraph 25 above, (though, as already mentioned, I intend to examine the specifics of issue (iii) first). (a) How did the defendant come to acquire the Audemars Piguet watches, items 1 & 3?[35]The short answer to this question is that the defendant acquired them from Mr Kassab, who had acquired them from the claimant.[36]Mr Kassab was an independent witness who attended court for cross-examination under a witness summons. He knew and had had dealings with Ziad Showai and the defendant over the years. He knew the claimant slightly. But he was not associated with either side. He struck me as an honest witness who was doing his best to give me an accurate account of what had occurred. That account was very much in line with the defendant’s evidence and very much at variance with the claimant’s. For that reason, and given that there was no room for him to have been merely mistaken about the transactions he described, Mr McCormick QC was constrained to challenge his honesty. But he had no reason to lie. He had nothing to gain by doing so. Further, his account was supported by bank transfers, the records of which were obviously authentic. I accept his evidence.[37]Mr Kassab told me that he had been contacted in June 2012 by Ziad Showai (the “dealmaker”) with a request for funds. He and the claimant “needed money” and the proposal was that they would deposit items 1 and 3 – two of the Audemars Piguet watches belonging to the claimant – in return for £85,000 to be repaid within 45 days. If the money was not repaid Mr Kassab would be entitled to keep the watches. They gave him item number 3, the Tourbillon, first. This took place at Elite’s garage premises in George Street. Later, the claimant on his own delivered item number 1, the Las Vegas. This took place in St John’s Wood, near to where Mr Kassab lived. On this occasion, the claimant also offered to sell a bangle, which the claimant told Mr Kassab he had paid £30,000 for. Mr Kassab kept the bangle with the watches – though ultimately he was not interested in acquiring it.[38]If Mr Kassab ever had a record of the transaction, it was no longer available. But he was able to produce his Emirates NBD bank statement for the relevant period. This showed that he had paid £31,500 to Elite in three tranches on 26 and 27 June 2012; (there was a £15,000 maximum on internet transfers). On the same statement, he had annotated that he had paid £25,000 to “Halifax Omar Account” by way of transfer to his Halifax account and a further £25,500 in cash to Omar. The total was £82,000. (In evidence, Mr Kassab said that he thought that this total was wrong and that he had in fact paid £28,500 in cash to the claimant, not £25,500.)[39]Mr Kassab’s account of the transaction was supported by a matching entry in the claimant’s bank statements, which he disclosed in response to the order for specific disclosure which I made on 3 November 2017. These showed a deposit of £25,000 on 27 July 2012 which he has confirmed was received from Mr Kassab. It was also supported by WhatsApp exchanges between them in which the sum of £25,000 was mentioned and Mr Kassab asked the claimant to bring “the box”. (Mr Kassab laid some emphasis on the importance of having a watch’s box and papers, which greatly affected the item’s saleability.)[40]The 45 days were due to expire on a date in August 2012. Before that date arrived, Mr Kassab attended a meeting at Elite’s premises. There were three other people present: Ziad Showai, the claimant and Mr El Muderris. Mr Kassab was paid his £85,000 by Mr El Muderris and he then handed over the watches to him. “I understood that he was giving that to me on behalf of Mr Showai and Mr Al Khyami.” This transaction was supported by Swift transfers dated 16 and 23 August 2012 in the sums of £70,000 and £15,000. Late in the day, the defendant came up with fuller versions of the transfers which specifically refer to “Audemars Piguet”. (His solicitor’s explanation for the late disclosure was not well-phrased. However, the documents were obviously genuine and I was prepared to admit them into evidence.)[41]The claimant explained the £25,000 he had received from Mr Kassab as a payment for an entirely different item – a bespoke Hermes handbag which, after he had split up with Ms Ecclestone, he no longer had a use for. It came in a big orange box and this was the box referred to in the WhatsApp messages. The claimant had made no mention of any such transaction until he had been compelled by order to produce his bank statements. Given the central role of Mr Kassab in these proceedings, that, if it was true, was a very surprising omission. When this alternative account of the £25,000 was put to Mr Kassab, he rejected it out of hand. “I never had a deal for a bag. I don’t pay £25,000 for a bag.” There is no independent support for it; it does not explain the other transfers of money by and to Mr Kassab; I have concluded that it is pure invention on the part of the claimant.[42]My acceptance of the evidence of Mr Kassab and Mr Ridha and my rejection of the claimant’s evidence of an entirely different transaction concerning a handbag is enough to dispose of this aspect of the claim. The defendant did not take these watches from Elite’s safe at George St or retain them for himself having offered to look after the contents of the safe whilst the garage was being refurbished. He acquired them lawfully. I am not sure that he gave me the whole story of the transaction or of the discussions with the claimant in March and April 2014. What was described to me had more the characteristics of the novation of an informal pawning agreement than a sale. If the claimant had concluded an outright sale of the watches to the defendant in August 2012 for £85,000 it is somewhat surprising that he would be offering double that amount 18 months later to buy them back. But this is immaterial. For present purposes, what matters is that, whatever the precise character of the transactions in relation to items 1 and 3, the defendant did not convert these items. (b) How did the defendant come to be displaying photographs of items 4 and 5 (Rolexes) on his wrist at some date prior to 24 May 2014?[43]It was an unfortunate aspect of the defendant’s evidence that it was not until he came into the witness box that he gave a full explanation. At paragraph 41 of his witness statement dated 11 August 2017 he had said that he did not “know anything about any of the Rolex watches”. The remainder of the paragraph consisted of prevarication. But in a summary of a police interview on 7 January 2016, he is recorded as having said the following:
“He says these watches have nothing to do with anybody, and these watches they were sold by Ziad Showai. He admits that he did handle them and yes he did take photos of them and send them on. He never denied that it’s his hand or not my hand, but all this doesn’t mean he stole those watches.”
[44]In evidence, he explained that he, or possibly a friend, had taken the pictures and that they had been posted as his WhatsApp profile picture. He had done that at the request of Ziad Showai who was offering them around and wanted to know what they were worth. (He had done that for Mr Showai before. “These watches come in all the time in Mr Showai’s showroom from Mr Khyami and from other people. Mr Showai said ‘can you see what it’s worth?’. I take a photo and post as profile picture or I send and ask how much it’s worth.”) He was not sure of the date or the place. It might have been at Mr Showai’s house. He had in excess of 700 persons in his WhatsApp group so that this was a good tool to test the market. He explained his reticence to come forward with this explanation as due to his desire to find out precisely how and from whom the claimant had acquired the photos (which is a poor excuse).[45]The defendant’s case on items 4 and 5 rests on the proposition that in taking the photographs he was acting for Ziad Showai, who was the seller of these watches. For the reasons that follow and notwithstanding the defendant’s prevarications and his tardy explanation of the photographs, this is plausible. The descriptions of claimed items 4, 5 & 6 match the descriptions of three watches recorded - in a document dated 22 October 2012 and headed “Receipt of Goods” - as pawned by the claimant to Mr Showai as security for the £250,000 loan that the claimant had taken from him / Elite. The relevant part of the document states as follows:
“This is to confirm that we have today received the following: Rolex GMT White Gold Diamonds - £87,000 Rolex GMT Yellow Gold Diamonds - £79,000 Rolex Daytona Rose Gold - £24,000 Cash received on Account - £10,000 Total - £200,000 You agree to use the above as security towards the Loan Agreement No. 0603125501 which currently remains unpaid.”
Rolex GMT White Gold Diamonds - £87,000 Rolex GMT Yellow Gold Diamonds - £79,000 Rolex Daytona Rose Gold - £24,000 Cash received on Account - £10,000

Total - £200,000

[46]The claimant said that in November 2013 he had settled the debt by giving Mr Showai, amongst other things, two watches. In a letter dated 17 June 2016 from Day Sparkes solicitors (who were acting for the claimant in the context of the dispute over the Lamborghini) it was said that the two watches were “two of the watches given as security for the loan valued at around £150,000”. By inference, these must have been the two Rolex GMTs (on the face of it, items 4 and 5) because the Daytona was much less valuable. If that is the case, then from November 2013 these watches were no longer the claimant’s and Mr Showai was at liberty to sell them – as the defendant alleged he did indeed do.[47]The claimant’s evidence on this aspect of the case was characteristically tortuous and hard to follow. I will set out its various components, at each stage explaining why I think the explanation unlikely.[48]He said that the Rolex GMT White Gold Diamonds (on the face of it, item 4) was in fact a Rolex GMT ii diamond bezel and strap. He blamed the misdescription on Ms Paula Mensikova, who was the secretary at Elite and who he said had drafted the agreement. A correct description of the goods was important and it is unlikely that a secretary would have drafted the agreement other than at the explicit instruction or dictation of the claimant and Mr Showai. So this would not explain the error. Further, the claimant signed the agreement.[49]The claimant said in his witness statement that this watch (item 4) was in pawn with Sutton & Robertsons in October 2012 and therefore cannot then have been pledged to Mr Showai. But the records from them only showed that it was redeemed from pawn on 29 May 2013. The records did not show when it was put into pawn and, in oral evidence, the claimant accepted that he was unable to say. It is perfectly possible that it was placed with Mr Showai as security in October 2012, later taken out and pawned with Sutton & Robertsons, then redeemed from pawn and placed back into security with Mr Showai. It was pointed out to the claimant in cross-examination that that was what apparently happened with item 5. This item (which the claimant had appeared to accept was placed with Mr Showai in October 2012) was pawned on 23 March 2013 and redeemed from pawn on 13 May 2013. At this point in cross-examination (and again, characteristically,) the claimant modified his evidence about item 5. He said that item 5 had in fact been swopped out of security for an Audemars Piguet serial number 003. He had not mentioned this in his witness statement, even though he had said that it was this watch (the Audemars Piguet) which was one of the two surrendered in repayment of the loan. This part of the claimant’s evidence had very much the character of improvisation. Given that the original pledge of the watches was recorded in writing in the Receipt of Goods agreement, it seems unlikely that a swop of this kind would not also have been recorded in writing in some way. Finally, it seems unlikely that this Audemars Piguet watch could or would have been swopped for item 5 so as to allow item 5 to be put into pawn when the Audemars Piguet was itself in pawn with Sutton & Robertsons for a period the start of which is unknown but which ended on 29 May 2013 (two weeks after item 5 was redeemed).[50]I prefer the much simpler explanation which the Receipt of Goods agreement and the letter from Day Sparkes on their face suggest. It is likely and I find that items 4 and 5 were placed with Mr Showai in October 2012 as security, taken out for a short period between March and May 2013 when they were placed into pawn with Sutton and Robertsons, redeemed, placed back with Mr Showai and then surrendered to him in part payment of the loan which the claimant owed.[51]On the balance of probabilities, the defendant’s explanation for his possession of items 4 and 5 is true. In any event (and to repeat his statement to the police) two photographs of him wearing them does not prove that he stole them.[52]There is one other small aspect of this part of the dispute which I should mention. Part of the claimant’s case on the Rolex watches, (which include items 4 and 5), was that when he reported the watches stolen to Rolex, a person he knew or believed to be the defendant had contacted Rolex to try to have them removed from the stolen list. This was relied on as an indication that the defendant had the watches and intended to sell them. The allegation was squarely made in the letter before claim dated 31 July 2015. The only email from Rolex touching on this, which was dated 7 May 2014, stated unequivocally that the person who had contacted Rolex was not Haydar El Muderris. The claimant had no basis for the allegation. (c) How did the defendant come to acquire the excluded items (the tiger necklace and the key necklace)?[53]The following matters are common ground. Tamara Ecclestone, supported by the evidence of two members of her staff, alleged that the tiger necklace and the key necklace had been stolen by the claimant. There was a police investigation and the claimant was formally charged with theft. The charges were eventually dropped. In the meantime, the defendant, who had acquired these items, had returned them to Ms Ecclestone. The claimant subsequently came to an agreement with Tamara and Bernie Ecclestone regarding these items. The agreement, which was verbal, is not in evidence. But the claimant no longer makes a claim against the defendant in respect of them.[54]Thus, the relevance of the excluded items is exclusively evidential. The defendant put the claimant’s title to them in issue. But this does not matter. What matters is whether, irrespective of who it was who owned them, the defendant acquired them unlawfully by simply taking them for himself. If he did do this, then it is the claimant’s case that it is likely he took the other items too. The defendant’s case is that he did not take them; he bought them (via Mr Al-Safee) from the claimant himself for £15,000 in August 2013.[55]At the trial, a good deal of attention was given to the statements made by all parties in the police investigation into the alleged theft. The claimant attacked the defendant’s account to the police because it was materially different to the account he gave in his witness statement and in evidence. Rather than a remote purchase from Turkey via Mr Al-Safee, the defendant had said that he had bought the items in person in the showroom of Elite in George Street; that it was Mr Showai who made the sale; and that of the £15,000 paid, only £10,000 was given to the claimant, who, though present, had remained on the fringes of the transaction. When pressed about these differences in cross-examination, the defendant became upset and agitated. He accepted that he had not been truthful. He said that at this time (the police statement was made in June 2014) he was “at war” with Mr Showai, that Mr Showai and the claimant were in it together, that he had been threatened, that he felt that the police were in league with the claimant’s lawyers, that he had “lost faith in the system” and that he wanted to get Mr Showai arrested.[56]The defendant attacked the claimant’s account to the police chiefly because of inconsistencies in the timings. The defendant also pointed out that Mr Showai’s account to the police made no mention of him (the defendant) removing the items from the safe.[57]Unlike the transactions in respect of the Audemars Piguet and the Rolex watches, there is no independent evidence. It is just the accounts of the claimant and the defendant, both of them unsatisfactory witnesses. What can, however, be stated with certainty is that there is no first-hand evidence of a taking by the defendant and, if attention is confined to the statement Mr Showai made to the police, no second-hand evidence either. The defendant, albeit with considerable divergences on the detail, has always maintained that he bought the items for £15,000 from the claimant. Such a transaction is plausible because the claimant had broken up with Ms Ecclestone and, at this time, was in financial need. On the claimant’s own evidence and on the evidence of Mr Kassab, he had sold or offered for sale other items acquired during his relationship with Ms Ecclestone. The defendant’s actions in returning these items to Ms Ecclestone seem to have been honourable (though I do not discount the value to the defendant of maintaining or fostering good relations with her and her father). For these reasons, and for the more general reasons developed below, the defendant’s account is, on the balance of probabilities, likely to be correct.[58]With that analysis of the case in relation to items 1, 3, 4 and 5 and the excluded items, I revert to the List of Issues. Issue (i) - The claimant’s ownership or right to possession of the claimed items[59]I will not dwell on this issue. The Particulars of Claim recited that the claimed items were all gifts from Ms Ecclestone. In fact, the claimant’s case was that items 6 and 8 had been purchased by him before the relationship commenced and item 11 was a gift that he had intended for Ms Ecclestone but had yet to give to her before they broke up. Nothing turns on any of this, (except that these were examples of the claimant’s tendency towards casual inaccuracies). Subject to the finding I have made in paragraph 50 above about items 4 and 5, I have no reason to doubt the claimant’s case that he owned or had the right to possession of all the claimed items. Issue (ii) - Whether all or some of them were placed in the safe by the claimant and if so why and on what terms[60]There is no real reason to doubt the claimant’s case that the items were placed in the safe. But I reject entirely his stated basis for doing so, which is, I have concluded, fabrication on his part. He said that he placed them there for safekeeping. But they were safely housed at the property belonging to his parents and, if more security were needed, a bank or a deposit box would have been the obvious choice. It is plain to me, and I find, that the items were placed in Elite’s safe as collateral for the loan which the claimant had taken from Elite / Mr Showai in February 2012. Part of the collateral for that loan was the Lamborghini that Ms Ecclestone had gifted to the claimant. But in April 2013, Ms Ecclestone obtained an injunction preventing dealings with the car and in those proceedings she asserted that the claimant only had the use of the car as long as the relationship continued; the car had remained her property. At that point, a very valuable part of the collateral for the loan became doubtful and the 11 claimed items (some of which were already deposited with Mr Showai) were obvious candidates to restore the status quo. At one point in his cross-examination, the claimant admitted as much – but then retracted the admission saying that Mr Campbell had confused him (though the question was not confusing).[61]The significance of this (other than as a credibility issue) is that a lender can acquire powers to deal with items placed with him as collateral. Further, (and particularly in the case of an unscrupulous lender), those powers can be exceeded. Issue (iii) - Whether any of the claimed items (and the excluded items) were taken unlawfully by the defendant[62]The claimant’s case on items 6 – 11 depends on an inference to be drawn from his case on items 1 – 5 and the excluded items. I have resolved his case on these items against him, so no inference is to be drawn. However, the overall resolution of the case requires several more observations and findings.[63]The first group of observations concerns Mr Showai. Despite his crucial relevance to the claim against the defendant, he was not called to give evidence. (Given the incidence of the burden of proof, it was wholly unrealistic to expect the defendant to call him for cross-examination pursuant to CPR r 33.4.) Only Mr Showai could have given first-hand evidence of a taking by the defendant. Without him, there was no proper evidence of that at all. The defendant denied that he had access to the safe, that he had removed items from the safe and that he had offered to take custody of the contents of the safe when the garage was refurbished. There was no first-hand evidence to rebut these denials, which were supported by Mr Ridha,(see further below). I have no solid basis to reject what the defendant was saying.[64]To be placed alongside the absence of Mr Showai was the fact that he was described by the claimant as dishonest, untrustworthy and capable of fraud. Indeed, the claimant had himself brought an action against Mr Showai in which he alleged fraudulent behaviour, including tricking another person, Ms Mensikova, to draw up false documentation. Dingemans J, in the case brought by Ms Ecclestone, made a finding that Mr Showai had conspired with a court bailiff to obtain possession of the Lamborghini by using paperwork from another case. I have heard no evidence from Mr Showai, although I was told by Mr Ridha that he was in the court building on the second day of the trial. It is not for me to make findings as to his honesty. But it is ambitious, to say the least, for the claimant to invite me to make inferences which rest substantially on the evidence of someone whom he has described in such pejorative terms.[65]The second group of observations and findings concerns Mr Ridha. Mr Ridha was a former employee (and latterly a director) of Elite. He was at the business premises of Elite every day and he knew Mr Showai and the claimant, whom he very often saw there, well. It is important to note that he had no quarrel with the claimant and that he had, indeed, helped the claimant, firstly to recover his Lamborghini (if it was his) and secondly to recover a watch of the claimant’s which Mr Showai had pawned. The watch was an Audemars Piguet Royal Oak Offshore 18ct RoseGold, (in all probability item number 2). It was pawned on 28 May 2015. Mr Ridha was the person named on the agreement at Mr Showai’s request. The amount obtained was £8,000 which was handed over to Mr Showai. Several months later, Mr Ridha informed the claimant of what had happened in order to give him the opportunity to redeem it. “Mr Showai had many watches he never owned. I thought it was Mr Khyami’s watch.” He was doing the claimant a favour. The watch was redeemed on about 3 August 2015.[66]This evidence was controversial for the obvious reason that if the watch was item number 2 and was being pawned in 2015, then the defendant could not have stolen it in 2013 or 2014 and this was further evidence in the defendant’s favour. Mr Ridha was heavily cross-examined about the details. These included a change in or departure from his written witness statement, which had said that the claimant himself had pawned the watch rather than it being Mr Showai who did so, and a discrepancy between the weight recorded in 2015 and in 2013 (when a watch acknowledged by the claimant to be item 2 was pawned). The 20g discrepancy in weight was said to demonstrate that they were not the same watch. The change in evidence was likely to be attributable to the fact that when the witness statement was drafted, the defendant was acting in person. Non-lawyers are apt to make such mistakes, (though lawyers are themselves by no means immune). The clarification offered by Mr Ridha was spontaneous and artless and I had no doubt that he was telling me the truth. As to the discrepancy in weight, that was small and might have been attributable to a number of things. I had little hesitation in concluding that the watch was indeed item number 2.[67]Mr Ridha also gave credible evidence that Mr Showai had possession of item number 6 in mid 2014, because at his request Mr Ridha had dropped this watch off at the home of a Ms Meliha Masta.[68]But this was not the most important part of Mr Ridha’s evidence. The most important part of his evidence was that in early 2014 he was present at a meeting between the claimant and Mr Showai at which they decided to cook up an allegation that the defendant had stolen the watches from the safe and make a false report to that effect to the police. This was convenient to both of them in that the claimant would recover money which Mr Showai was in no position to pay him and Mr Showai would “get rid of” the defendant, to whom he also owed money.[69]That there was an agreement to this effect finds some support in a curious document signed by the claimant and Mr Showai on 7 May 2014, headed “Agreement No. 070514”. (The date of the agreement is 2 days before the defendant obtained a freezing injunction against Elite and Mr Showai in action number HQ14X01846.) This agreement listed 14 items which had been “kept for safety with Elite”. Leaving aside minor discrepancies in wording, it appears that the 11 claimed items were included in the list along with the excluded items and one other watch. The material part of the agreement stated:
“It is agreed that Elite Performance Cars will be liable to pay an agreed market price for the above goods, should the goods become unrecoverable from Mr Hayder El-Muderris.”
[70]On the face of it, and in ordinary language, the agreement was saying “see if you can get satisfaction against Mr El-Muderris and if you can’t Elite will square things up with you”. That is consistent with the verbal agreement described by Mr Ridha.[71]That there was such an agreement also finds some support in the claimant’s otherwise baffling refusal to countenance the possibility that Mr Showai was responsible for the disappearance of his goods. In simple and courteous language, Mr Campbell put this obvious point to the claimant many times. But the claimant would not accept it, insisting that the taker must have been the defendant.[72]I came to the conclusion that Mr Ridha’s evidence on this matter (as with his evidence generally) was truthful. He told me that he had come to court in the face of threats against him by the claimant and by a person whom he could not name but who he thought had been acting on the instructions of the claimant. He had reported these matters to the police, who ultimately took no action. The claimant denied all and any such threats. I have already said that where the claimant’s evidence was in conflict with Mr Ridha’s, I preferred Mr Ridha’s. Beyond saying that, I do not think it would be appropriate to make findings about witness intimidation in circumstances where the police have decided to take no action and where the matter before me is the trial of the action and not proceedings for contempt. What matters for present purposes is that Mr Ridha’s fear of the claimant and of Mr Showai were readily apparent and genuine, yet he had still come to court. That, combined with the fact that he had no reason to lie or to take sides, led me to place confidence in his evidence. I think it is likely that the conversation between the claimant and Mr Showai which he described took place. Conclusion[73]For these reasons, the claim fails and is dismissed. Damages[74]In case the claim should go further, I will add a short note concerning the damages. Had I found in the claimant’s favour his remedy would have been the market value of the goods at the date of conversion. This is the subject of an expert report from Professor Peter Taylor dated 5 October 2017. With 30 years experience of valuing jewellery, Professor Taylor was well-placed to offer an opinion and his report was not challenged. The open market value at the relevant date was £210,000.[75]Special circumstances are required to depart from that basic rule and there are no such circumstances here. In particular, there is no evidence that the claimant has the intention to go into the market and purchase replacements at current values.[76]Damages for loss of use are only available if an award is made at current values, rather than the values at the date of conversion. Here, there would be an additional reason to deny damages for loss of use, which is that the items were treated by the claimant as financial assets. On the evidence I have heard, he actually wore them very rarely.[77]Had the claimant’s case been made out, then he would have demonstrated treatment at the hands of the defendant that was high-handed and oppressive. I would therefore have also awarded him aggravated damages, which I would have assessed in the sum of £21,000.