Invest Bank P.S.C. v Ahmad Mohammad El-Husseini

Hearing dates: 16 and 17 May 2024

APPROVED JUDGMENT

A. INTRODUCTION AND BACKGROUND

The parties appear before the Court upon the hearing of the two day Pre Trial Review of the claims in this action (recently extended at my instigation and direction from one day), in advance of a 4 week trial due to commence on 1 July 2024, with the skeleton argument for trial of the Claimant Invest Bank P.S.C. (the “Bank”) being due on 26 June 2024 (i.e. just over 5 weeks away). By such time all matters must be pleaded out, all issues crystallised, any and all further disclosure given and any and all further factual and expert evidence must have been served, and all in good time before that so as to facilitate the preparation of the respective skeletons and to enable proper and fair preparation for the trial itself (preparation which will inevitably be both extensive and onerous). The parties state they are trial ready subject only to a number of matters arising on the PTR, and that should be capable of resolution at the PTR, none of which would give rise to difficulties in relation to the trial still less put in jeopardy the viability of the trial or its current duration.

However, there is a very recent substantive (and substantial) application on the part of the Bank to Re-Re-Re-Re-Re-Amend its Particulars of Claim, which must inevitably be determined at the start of the PTR and before the remainder of the PTR can take place, and which has major potential implications in relation to preparation for trial and whether (if the amendments are allowed in whole or in part) the trial could go ahead, namely the Bank's application dated 25 April 2024 to serve Re-Re-Re-Re-Re-Amended Particulars of Claim with consequential directions sought for responsive amended Defences (and Reply) (the “Amendment Application”) (the Bank also accepting, in its evidence, that further witness evidence will also be likely).

In relation to the Amendment Application:

(1) The Amendment Application is supported by the Eighteenth Witness Statement of Trevor Mascarenhas of PCB Byrne LLP also dated 25 April 2024 (“Mascarenhas 18”).

(2) In circumstances in which the Bank achieved an expedited listing of the Amendment Application upon the PTR (without which, realistically, the Amendment Application would never even have got on before trial based on an appropriate one day estimate), the Amendment Application is opposed (on behalf of the Second Defendant, Mohammed Ahmad El-Husseiny (“Mo”) and the Sixth Defendant Joan Eva Henry (“Joan”)) by the Sixth Witness Statement of Juliet Schalker of Debenhams Ottaway LLP (“Schalker 6”) dated 9 May 2024 (served within short order and on the basis of a truncated timescale for responsive evidence on what is a heavy application). Schalker 6 is accompanied by an Annex 1 which is a table setting out dates (by reference to documents) by which it is said the Bank could have pleaded the proposed amendments (setting out dates, before 5 July 2021 and/or September 2021 and/or October 2021 and/or January, February or March 2022 and/or October 2023 and/or (in one instance) January 2024 (the “Schalker Table”). Mo and Joan have also served a preliminary letter report on UAE and Lebanese law from Professor Hadi Slim dated 8 May 2024 (the “Hadi Report”) and on which they seek to rely on the Amendment Application.

(3) The Bank replied to Schalker 6 in the Nineteenth Witness Statement of Trevor Mascarenhas dated 13 May 2024 (“Mascarenhas 19”), i.e. on the same day as the Bank's Skeleton Argument for the PTR, and the day before the Skeleton Argument on behalf of D2 and D6 (which I will refer to, for ease of reference, as the “Defendants' Skeleton Argument”), D2 and D6 leading the opposition to the majority of the proposed amendments. Mascarenhas 19 is accompanied by an Annex 1 thereto which is a table of documents upon which the Bank relies to advance its proposed amended case (the “Mascarenhas Table”). On the morning of the hearing yesterday, the Bank (without leave) provided a yet further statement from Mr Mascarenhas (“Mascarenhas 20”) responding to two points set out in the Defendants' Skeleton Argument (addressing the timing of the making of the Amendment Application and correcting what had been said about Sheikh Tahnoon).

(4) The Seventh Defendant, Virtue Trustees (Switzerland) A.G. (“Virtue”) through its solicitors Edwin Coe LLP, have corresponded with PCB Byrne (on behalf of the Bank) in relation to the Amendment Application. Virtue has also served a Skeleton Argument (the “Virtue Skeleton Argument”). Virtue complained about aspects of the proposed amendments (in particular as to their particularity), leading to further proposed amendments. By the time of the hearing the amendments so far as they related to Virtue were largely agreed between Virtue and the Bank and it was agreed that remaining matters could be addressed later in the PTR following this Judgment.

The First Defendant, Ahmad Mohammed El-Husseini (“Ahmad”), is not represented at the hearing and did not appear. The Third Defendant Alexander Ahmad El-Husseiny (“Alex”), the Fourth Defendant Ziad Ahmad El-Husseiny (“Ziad”) and the Fifth Defendant Ramzy Ahmad El-Husseiny (“Ramzy”) are not represented at the hearing, but they have all been present (Ramzy in Court, Alex and Ziad by video link) and I heard from each of them briefly on the Amendment Application. They each confirmed that they adopted the submissions of D2/D6 so far as they also relate to their position.

The draft Re-Re-Re-Re-Amended Particulars of Claim involve in the region of 143 amendments that D2 and D6 say are substantive. They have consented to (or are neutral as to) 66 of them (whilst identifying that even these will cause additional work, including pleading back to, very shortly before trial).

That leaves 77 amendments (which for ease of reference and definition hereafter I will refer to as the “Proposed Amendments”) which are objected to on behalf of D2 and D6 (and other Defendants) for a variety of reasons, the overarching reason being that they say that the trial date would be lost if permission were to be granted (in the context of the need for response pleas, disclosure, further factual evidence and expert evidence and the impact on fair trial preparation). The Proposed Amendments include what was contended by D2 and D6 to be a new allegation of dishonesty, a new allegation of bad faith, a new claim for $15 million against Joan (not previously pleaded and said to be barred by limitation) and a new factual basis for the Bank's existing claims under section 423 of the Insolvency Act 1986 (“Section 423”) which, if permitted, D2 and D6 say would require a further disclosure exercise, further witness evidence, and expert evidence of UAE and Lebanese law. It is submitted that the Proposed Amendments are variously either “very late” or on any view “late”, most are time barred by section 35 of the Limitation Act 1980, others are embarrassing (in the technical sense) and others are said to have no real prospect of success.

In addition to the points made in correspondence and in the Defendants' Skeleton Argument such stance is also supported by the evidence of Ms Schalker, a solicitor of the Senior Courts and partner in Debenham Ottaway LLP, who states (amongst other matters) in Schalker 6 as follows:

“6. Mascarenhas 18 attempts to portray the amendments as a limited particularisation of the Bank's claim ahead of trial. In reality, the Bank's numerous proposed amendments are an attempt substantially to recast its case at the eleventh hour. They include new allegations of dishonesty against Joan, a new claim against her for up to $15 million (which is in any event time-barred) and a new claim against both Joan and Mo that is also time-barred.

7. As I explain below, the amendments, if permitted, will require further investigation, further expert evidence, further factual evidence and further disclosure. This will inevitably result in the adjournment of the trial because that work cannot be done in the time that remains before trial; and the current 4-week listing is in any event inadequate to accommodate these further issues.

…

41. Joan and Mo will invite the Court to dismiss the amendment application. As explained above, I do not, with respect, consider that a fair trial with the current trial date is possible if the amendments are permitted.”

In contrast, and in addition to the views expressed by Mr Mascarenhas (a solicitor of the Senior Courts and partner in PCB Byrne) in Mascarenhas 18, 19 and 20, the stance of the Bank is set out in the Bank's Skeleton Argument where it is stated, amongst other matters:

“3. The Bank is a stranger to all [the] asset transfer transactions of D1. Its claims are necessarily inferential in nature. Its task has been to piece together what has happened from public records, disclosure and the explanations given by various Ds across their statements of case, interlocutory evidence and trial evidence in...