LONDON - Friday, 22. November 2024 AETOSWire
Sharjah-based Invest Bank UAE filed over 100 applications and subpoenas
across nine jurisdictions in pursuit of its claims against members of
the El Husseiny family.
All the Bank’s remaining claims have now been dismissed by the English High Court.
The full judgment on the case is available here.
(BUSINESS
WIRE) -- In a decisive ruling, the High Court of England and Wales (the
“High Court”) has unequivocally found in favour of and dismissed all
claims against the El Husseiny family (the “Family”) and Virtue Trustees
(Kendris) their institutional Swiss wealth adviser, bringing an end to a
protracted legal battle in the UK initiated by the Sharjah
Government-owned Invest Bank (the “Bank”), with the backing of
litigation funder Burford Capital.
The litigation, spanning four
years and nine jurisdictions, arose from allegations that Lebanese
businessman Ahmad El Husseini acted as a guarantor for credit facilities
granted to two UAE companies: Commodore Contracting Company and Al
Tadamun Glass and Aluminium Company in 2015 and 2016, respectively.
Ahmad always maintained that these guarantees were never given and that
the documents which claim to evidence the guarantees are forgeries. A
default judgment was subsequently entered against Ahmad in England.
The
Bank later initiated a claim against Ahmad and his family (the
“Defendants”) pursuant to s. 423 of the Insolvency Act 1986 to reverse
various transfers of assets from Ahmad or companies owned by him to his
family members or their companies, in what the Bank described as a
"worldwide asset dissipation scheme to defeat his creditors." This
allegation was first advanced by the Bank at an ex parte hearing in July
2021, of which the Defendants were unaware and at which they were
unrepresented. It was subsequently contested by the Defendants, who
maintained that the alleged asset transfers either occurred for
legitimate reasons such as tax planning (to mitigate the impact of a
publicised change to the UK inheritance tax regime which came into force
on 4 April 2017), or in some cases did not take place at all.
The
High Court's ruling confirms the family’s long-held position that these
allegations were entirely unfounded, vindicating them after years of
determined litigation by the Bank and its legal team.
At
paragraph 483 of a 120-page judgment handed down today, High Court Judge
The Honourable Mr Justice Calver stated “I find that the Bank has
failed to prove any of its claims against the Defendants and its claims
are accordingly dismissed against each of them.”
“We are grateful
for the High Court’s decision today, which has ruled unequivocally in
our favour,” the El Husseiny family stated. “Invest Bank has pursued its
claim against our family for four years relentlessly and across
multiple jurisdictions. We have always maintained that this claim was
totally unfounded and today our position has finally been vindicated.
"While
today’s ruling brings a sense of comfort, this prolonged and intense
litigation has inflicted significant financial, reputational, and
emotional damage on us as a family. Through no wrongdoing on our part,
we have been forced to defend these meritless claims both in the UK and
abroad, spending vast sums of money as the Bank sought to change their
case at least eight times, pursuing one angle and then another in their
claim against our family.”
The cost of the sprawling
multi-jurisdictional litigation has vastly exceeded the alleged £19
million debt. Since the litigation began, the Bank filed over 100
applications and subpoenas across nine jurisdictions, seeking to
financially cripple the family and force a settlement.
Additionally,
subpoenas were unlawfully obtained in New York, South Dakota and
California in an attempt to gain financial records, Gmail and WhatsApp
information, and private investigators were hired to dig into the lives
of the defendants, their partners, and even their young children. The El
Husseiny family successfully challenged the Bank’s subpoenas, with a US
judge ruling against Invest Bank and their partners that they formed
the “vanguard of an illegal worldwide fishing expedition.”
In
another example of the Bank’s aggressive pursuit of the claim, in June
2023, the Bank sought an order preventing Joan (Ahmad’s former wife, an
elderly Scottish lady) from using her own funds for living and legal
expenses without their consent or court approval. The application was
dismissed with costs paid to Joan; and The Honourable Mrs Justice Dias
observed that the order sought by the Bank would be “wholly
inappropriate”, that the Court had no jurisdiction to grant it and that
“it could not conceivably be right, even in principle, to make such an
order.”
At the same time, Ahmad’s global assets remained frozen
due to the Bank issuing similar proceedings in Canada, leaving him
unable to pay his UK legal team and forcing him to withdraw from the UK
proceedings. Despite multiple written requests via the Bank’s lawyers
seeking permission to sell a property to cover his legal fees, no
resolution was provided which culminated in the ailing Ahmad being
unable to continue in the UK proceedings and resulted in a default
judgement against him. In this case, the Bank successfully crippled
Ahmad’s finances and ability to continue in the proceedings.
Despite
the Bank amending its legal claims at least seven times in the UK
proceedings and attempting to adjourn the trial 4 weeks before it
started, the court ultimately found no merit in its allegations.
The
El Husseiny family concluded, “This has been an ordeal for our family
and, while we are all happy that today it is over, we feel strongly that
it should never been allowed in the first place. This case serves as a
troubling example of how our justice system can be exploited to bring
speculative claims with little regard for the individuals involved. The
UK taxpayer-funded courts should not serve as a playground for
litigation of this nature.
“Today’s ruling is not only a personal
victory for our family but also a powerful reminder that justice can
prevail, albeit at significant personal and financial cost. We are
currently considering all available options for costs and compensation
in light of the significant damage we have endured.”
The second and sixth defendants were represented by Debenhams Ottaway.
Notes to Editors
Background on the case:
Invest Bank, a public shareholding company established in the United
Arab Emirates, asserts that it has judgment debts against Ahmad
El-Husseini from proceedings brought in Abu Dhabi. Ahmad was never
served in those proceedings. Although the Bank had his full contact
information and address, he was served using false contact information.
The claims in those proceedings were brought on the basis of personal
guarantees allegedly given by Ahmad in connection with two credit
facilities. The judgment debts are said to amount to c.AED 96 million
(c.£19 million).
The Bank alleged that, before those
judgments were obtained, Ahmad El-Husseini transferred, or caused his
companies to transfer, a number of valuable assets, in the form of
shares, real estate and monies, to his family members and/or companies
said to be under their control and/or a trust of which they were
beneficiaries, to put them beyond the reach of his creditors.
The Bank therefore sought declarations that Ahmad El-Husseini holds the
beneficial interest in the property assets, and relief under s.423 of
the Insolvency Act 1986 as regards all of the assets.
This
allegation was contested by the Family, which stated that the alleged
asset transfers either did not take place at all or that they occurred
for legitimate reasons such as tax planning (for example, it is said, to
mitigate the impact of a publicised change to the UK inheritance tax
regime which came into force on 4 April 2017).
In todays
judgement para [483], High Court Judge Mr Justice Calver stated “I find
that the Bank has failed to prove any of its claims against the
Defendants and its claims are accordingly dismissed against each of
them.”
Sheikh Tahnoon bin Saeed bin Shakboot Al-Nahyan
(“Sheikh Tahnoon”), a former business partner of Ahmad, seized control
of the UAE companies from Ahmad while he was in a sale process for
Commodore, the main company, while Invest Bank subsequently pursued a
default judgment against him for the purported unpaid debt.
Invest Bank did not seek to reclaim the alleged debt from the Commodore
or Tadamun liquidations in the UAE, instead pursued Ahmad, his extended
family and Kendris in nine jurisdictions at disproportionately vast cost
compared to simply applying to the UAE liquidation (which Invest Bank
finally did, during the UK trial itself, 5 years later).
Please note that the Sheikh Tahnoon bin Saeed bin Shakboot Al-Nahyan
(“Sheikh Tahnoon”) that we refer to, should not be confused with Sheikh
Tahnoon bin Zayed Al Nahyan.
View source version on businesswire.com: https://www.businesswire.com/news/home/20241121662133/en/
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Contacts
Kit Dunford
FTI Consulting
+44 (0)7717 417 038
Kit.dunford@fticonsulting.com
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